TRICARE; Civilian Health and Medical Program of the Uniformed Services (CHAMPUS); Fiscal Year 2015 Diagnosis Related Group (DRG) Updates, 7844-7846 [2015-02898]
Download as PDF
<![CDATA[
7844
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
DEPARTMENT OF DEFENSE
Office of the Secretary
DoD Medicare-Eligible Retiree Health
Care Board of Actuaries; Notice of
Federal Advisory Committee Meeting
DoD.
Meeting notice.
AGENCY:
ACTION:
The Department of Defense is
publishing this notice to announce a
meeting of the DoD Medicare-Eligible
Retiree Health Care Board of Actuaries.
This meeting will be open to the public.
DATES: Friday, July 31, 2015, from 10:00
a.m. to 12:00 p.m.
ADDRESSES: 4800 Mark Center Drive,
Conference Room 18, Level B1,
Alexandria, VA 22350.
FOR FURTHER INFORMATION CONTACT:
Kathleen Ludwig at the Defense Human
Resource Activity, DoD Office of the
Actuary, 4800 Mark Center Drive, STE
05E22, Alexandria, VA 22350–7000.
Phone: 571–372–1993. Email:
Kathleen.A.Ludwig.civ@mail.mil.
SUPPLEMENTARY INFORMATION: This
meeting is being held under the
provisions of the Federal Advisory
Committee Act of 1972 (5 U.S.C.,
Appendix, as amended), the
Government in the Sunshine Act of
1976 (5 U.S.C. 552b, as amended), and
41 CFR 102–3.150.
Purpose of the Meeting: The purpose
of the meeting is to execute the
provisions of 10 U.S.C. chapter 56 (10
U.S.C. 1114 et seq). The Board shall
review DoD actuarial methods and
assumptions to be used in the valuation
of benefits under DoD retiree health care
programs for Medicare-eligible
beneficiaries.
Rmajette on DSK2VPTVN1PROD with NOTICES
SUMMARY:
Agenda
1. Meeting Objective
Approve actuarial assumptions and
methods needed for calculating:
i. FY 2017 per capita full-time and parttime normal cost amounts
ii. September 30, 2014, unfunded
liability (UFL)
iii. October 1, 2015, Treasury UFL
amortization and normal cost
payments
2. Trust Fund Update
3. Medicare-Eligible Retiree Health Care
Fund Update
4. September 30, 2013, Actuarial
Valuation Results
5. September 30, 2014, Actuarial
Valuation Proposals
6. Decisions
Actuarial assumptions and methods
needed for calculating:
a. FY 2017 per capita full-time and parttime normal cost amounts
VerDate Sep<11>2014
13:54 Feb 11, 2015
Jkt 235001
b. September 30, 2014, unfunded
liability (UFL)
c. October 1, 2015, Treasury UFL
amortization and normal cost
payments
Public’s Accessibility to the Meeting:
Pursuant to 5 U.S.C. 552b and 41 CFR
102–3.140 through 102–3.165 and the
availability of space, this meeting is
open to the public. Seating is on a first
come basis. The Mark Center is an
annex of the Pentagon. Those without a
valid DoD Common Access Card must
contact Kathleen Ludwig at 571–372–
1993 no later than June 30, 2015. Failure
to make the necessary arrangements will
result in building access being denied.
It is strongly recommended that
attendees plan to arrive at the Mark
Center at least 30 minutes prior to the
start of the meeting.
Pursuant to 41 CFR 102–3.105(j) and
102–3.140, and section 10(a)(3) of the
Federal Advisory Committee Act of
1972, the public or interested
organizations may submit written
comments to the Board about its
mission and topics pertaining to this
public meeting.
Committee’s Designated Federal
Officer or Point of Contact: Persons
desiring to attend the DoD MedicareEligible Retiree Health Care Board of
Actuaries meeting or make an oral
presentation or submit a written
statement for consideration at the
meeting, must notify Kathleen Ludwig
at (571) 372–1993, or
Kathleen.A.Ludwig.civ@mail.mil, by
June 30, 2015.
Dated: February 6, 2015.
Aaron Siegel,
Alternate OSD Federal Register Liaison
Officer, Department of Defense.
[FR Doc. 2015–02872 Filed 2–11–15; 8:45 am]
BILLING CODE 5001–06–P
DEPARTMENT OF DEFENSE
Office of the Secretary
TRICARE; Civilian Health and Medical
Program of the Uniformed Services
(CHAMPUS); Fiscal Year 2015
Diagnosis Related Group (DRG)
Updates
Office of the Secretary, DoD.
Notice of DRG revised rates.
AGENCY:
ACTION:
This notice describes the
changes made to the TRICARE DRGbased payment system in order to
conform to changes made to the
Medicare Prospective Payment System
(PPS). It also provides the updated fixed
loss cost outlier threshold, cost-to-
SUMMARY:
PO 00000
Frm 00018
Fmt 4703
Sfmt 4703
charge ratios, and the data necessary to
update the FY 2015 rates.
DATES: Effective Dates: The rates,
weights, and Medicare PPS changes
which affect the TRICARE DRG-based
payment system contained in this notice
are effective for discharges occurring on
or after October 1, 2014.
ADDRESSES: Defense Health Agency,
TRICARE, Medical Benefits and
Reimbursement Office, 16401 East
Centretech Parkway, Aurora, CO 80011–
9066.
FOR FURTHER INFORMATION CONTACT:
Amber L. Butterfield, Medical Benefits
and Reimbursement Office, TRICARE,
telephone (303) 676–3565.
Questions regarding payment of
specific claims under the TRICARE
DRG-based payment system should be
addressed to the appropriate contractor.
SUPPLEMENTARY INFORMATION: The final
rule published on September 1, 1987 (52
FR 32992) set forth the basic procedures
used under the CHAMPUS DRG-based
payment system. This was subsequently
amended by final rules published
August 31, 1988 (53 FR 33461); October
21, 1988 (53 FR 41331); December 16,
1988 (53 FR 50515); May 30, 1990 (55
FR 21863); October 22, 1990 (55 FR
42560); and September 10, 1998 (63 FR
48439).
An explicit tenet of these final rules,
and one based on the statute authorizing
the use of DRGs by TRICARE, is that the
TRICARE DRG-based payment system is
modeled on the Medicare PPS, and that,
whenever practicable, the TRICARE
system will follow the same rules that
apply to the Medicare PPS. The Centers
for Medicare and Medicaid Services
(CMS) publishes these changes annually
in the Federal Register and discusses in
detail the impact of the changes.
In addition, this notice updates the
rates and weights in accordance with
our previous final rules. The actual
changes we are making, along with a
description of their relationship to the
Medicare PPS, are detailed below.
I. Medicare PPS Changes Which Affect
the TRICARE DRG-Based Payment
System
Following is a discussion of the
changes CMS has made to the Medicare
PPS that affect the TRICARE DRG-based
payment system.
A. DRG Classifications
Under both the Medicare PPS and the
TRICARE DRG-based payment system,
cases are classified into the appropriate
DRG by a Grouper program. The
Grouper classifies each case into a DRG
on the basis of the diagnosis and
procedure codes and demographic
E:\FR\FM\12FEN1.SGM
12FEN1
Rmajette on DSK2VPTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
information (that is, sex, age, and
discharge status). The Grouper used for
the TRICARE DRG-based payment
system is the same as the current
Medicare Grouper with two
modifications. The TRICARE system has
replaced Medicare DRG 435 with two
age-based DRGs (900 and 901), and has
implemented thirty-four (34) neonatal
DRGs in place of Medicare DRGs 385
through 390. For admissions occurring
on or after October 1, 2001, DRG 435 has
been replaced by DRG 523. The
TRICARE system has replaced DRG 523
with the two age-based DRGs (900 and
901). For admissions occurring on or
after October 1, 1995, the CHAMPUS
Grouper hierarchy logic was changed so
the age split (age <29 days) and
assignments to Major Diagnostic
Category (MDC) 15 occur before
assignment of the pre-MDC DRGs. This
resulted in all neonate tracheostomies
and organ transplants to be grouped to
MDC 15 and not to DRGs 480–483 or
495. For admissions occurring on or
after October 1, 1998, the CHAMPUS
Grouper hierarchy logic was changed to
move DRG 103 to the pre-MDC DRGs
and to assign patients to pre-MDC DRGs
480, 103, and 495 before assignment to
MDC 15 DRGs and the neonatal DRGs.
For admissions occurring on or after
October 1, 2001, DRGs 512 and 513
were added to the pre-MDC DRGs,
between DRGs 480 and 103 in the
TRICARE Grouper hierarchy logic. For
admissions occurring on or after
October 1, 2004, DRG 483 was deleted
and replaced with DRGs 541 and 542,
splitting the assignment of cases on the
basis of the performance of a major
operating room procedure. The
description for DRG 480 was changed to
‘‘Liver Transplant and/or Intestinal
Transplant’’, and the description for
DRG 103 was changed to ‘‘Heart/Heart
Lung Transplant or Implant of Heart
Assist System’’. For FY 2007, CMS
implemented classification changes,
including surgical hierarchy changes.
The TRICARE Grouper incorporated all
changes made to the Medicare Grouper,
with the exception of the pre-surgical
hierarchy changes, which will remain
the same as FY 2006. For FY 2008,
Medicare implemented their MedicareSeverity DRG (MS–DRG) based payment
system. TRICARE, however, continued
with the Centers for Medicare and
Medicaid Services DRG-based (CMS–
DRG) payment system for FY 2008. For
FY 2009, the TRICARE/CHAMPUS
DRG-based payment system shall be
modeled on the MS–DRG system, with
the following modifications.
The MS–DRG system consolidated the
43 pediatric CMS DRGs that were
VerDate Sep<11>2014
13:54 Feb 11, 2015
Jkt 235001
7845
defined based on age less than or equal
to 17 into the most clinically similar
MS–DRGs. In their Inpatient Prospective
Payment System final rule for MS–
DRGs, Medicare stated for their
population these pediatric CMS DRGs
contained a very low volume of
Medicare patients. At the same time,
Medicare encouraged private insurers
and other non-Medicare payers to make
refinements to MS–DRGs to better suit
the needs of the patients they serve.
Consequently, TRICARE finds it
appropriate to retain the pediatric CMS–
DRGs for our population. TRICARE is
also retaining the TRICARE-specific
DRGs for neonates and substance use.
For FY09, TRICARE will use the MS–
DRG v26.0 pre-MDC hierarchy, with the
exception that MDC 15 is applied after
DRG 011–012 and before MDC 24.
For FY10, there are no additional or
deleted DRGs.
For FY 11, the added DRGs and
deleted DRGs are the same as those
included in CMS’ final rule published
on August 16, 2010 (75 FR 50041–
50677). That is, DRG 009 is deleted;
DRGs 014 and 015 are being added.
For FY 12, the added DRGs and
deleted DRGs are the same as those
included in CMS’ final rule published
on August 18, 2011 (76 FR 51476–
51846). That is, DRG 015 is deleted;
DRGs 016 and 017 are being added.
For FY 2013 there are no new,
revised, or deleted DRGs.
For FY 2014 there are no new,
revised, or deleted DRGs.
For FY 2015 the added, deleted and
revised DRGs are the same as those
included in the CMS’ final rule
published on August 22, 2014, (79 FR
49853–50536), with the exception of
endovascular cardiac valve replacement
for which CMS added DRGs 266/267.
The TRICARE Grouper already has
DRGs 266/267 assigned to a pediatric
procedure therefore TRICARE added
DRGs 317/318, respectively, for
endovascular cardiac valve replacement.
C. Revision of the Labor-Related Share
of the Wage Index
B. Wage Index and Medicare
Geographic Classification Review Board
Guidelines
F. National Operating Standard Cost as
a Share of Total Costs
TRICARE will continue to use the
same wage index amounts used for the
Medicare PPS. TRICARE will also
duplicate all changes with regard to the
wage index for specific hospitals that
are redesignated by the Medicare
Geographic Classification Review Board.
In addition, TRICARE will continue to
utilize the out commuting wage index
adjustment.
PO 00000
Frm 00019
Fmt 4703
Sfmt 4703
TRICARE is adopting CMS’
percentage of labor related share of the
standardized amount. For wage index
values greater than 1.0, the labor related
portion of the Adjusted Standardized
Amount (ASA) shall continue to equal
69.6 percent. For wage index values less
than or equal to 1.0 the labor related
portion of the ASA shall continue to
equal 62 percent.
D. Hospital Market Basket
TRICARE will update the adjusted
standardized amounts according to the
final updated hospital market basket
used for the Medicare PPS for all
hospitals subject to the TRICARE DRGbased payment system according to
CMS’ August 22, 2014, final rule. For
FY 2015, the market basket is 2.9
percent. Note: Medicare’s FY 2015
market basket index adjusts according to
hospitals’ compliance with quality data
and electronic health record meaningful
use submissions. These adjustments do
not apply to the TRICARE Program.
E. Outlier Payments
Since TRICARE does not include
capital payments in our DRG-based
payments (TRICARE reimburses
hospitals for their capital costs as
reported annually to the contractor on a
pass through basis), we will use the
fixed loss cost outlier threshold
calculated by CMS for paying cost
outliers in the absence of capital
prospective payments. For FY 2015, the
TRICARE fixed loss cost outlier
threshold is based on the sum of the
applicable DRG-based payment rate plus
any amounts payable for Indirect
Medical Education (IDME) plus a fixed
dollar amount. Thus, for FY 2015, in
order for a case to qualify for cost outlier
payments, the costs must exceed the
TRICARE DRG base payment rate (wage
adjusted) for the DRG plus the IDME
payment (if applicable) plus $22,705
(wage adjusted). The marginal cost
factor for cost outliers continues to be
80 percent.
The FY 2015 TRICARE National
Operating Standard Cost as a Share of
Total Costs (NOSCASTC) used in
calculating the cost outlier threshold is
0.922. TRICARE uses the same
methodology as CMS for calculating the
NOSCASTC; however, the variables are
different because TRICARE uses
national cost to charge ratios while CMS
uses hospital specific cost to charge
ratios.
E:\FR\FM\12FEN1.SGM
12FEN1
7846
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
G. Indirect Medical Education (IDME)
Adjustment
Passage of the Medical Modernization
Act of 2003 modified the formula
multipliers to be used in the calculation
of IDME adjustment factor. Since the
IDME formula used by TRICARE does
not include disproportionate share
hospitals (DSHs), the variables in the
formula are different than Medicare’s,
however; the percentage reductions that
will be applied to Medicare’s formula
will also be applied to the TRICARE
IDME formula. The multiplier for the
IDME adjustment factor for TRICARE for
FY 2015 is 1.02.
I. Pricing of Claims
The final rule published on May 21,
2014, (79 FR 29085–29088) set forth all
final claims with discharge dates of
October 1, 2014, or later and reimbursed
under the TRICARE DRG-Based
payment system, are to be priced using
the rules, weights and rates in effect on
as of the date of discharge. Prior to this,
all final claims were priced using the
rules, weights and rates in effective as
of the date of admission.
J. Updated Rates and Weights
Rmajette on DSK2VPTVN1PROD with NOTICES
BILLING CODE 5001–06–P
DEPARTMENT OF DEFENSE
Office of the Secretary
TRICARE, Formerly Known as the
Civilian Health and Medical Program of
the Uniformed Services (CHAMPUS);
Fiscal Year 2015 Mental Health Rate
Updates
Department of Defense.
Notice of updated mental health
rates for Fiscal Year 2015.
ACTION:
TRICARE uses a national Medicare
cost-to-charge ratio (CCR). For FY 2015,
the Medicare CCR used for the TRICARE
DRG-based payment system for acute
care hospitals and neonates will be
0.2726. This is based on a weighted
average of the hospital-specific
Medicare CCRs (weighted by the
number of Medicare discharges) after
excluding hospitals not subject to the
TRICARE DRG system (Sole Community
Hospitals, Indian Health Service
hospitals, and hospitals in Maryland).
The Medicare CCR is used to calculate
cost outlier payments, except for
children’s hospitals. The Medicare CCR
has been increased by a factor of 1.0065
to include an additional allowance for
bad debt. The 1.0065 factor reflects the
provisions of the Middle Class Tax
Relief and Job Creation Act of 2012. For
children’s hospital cost outliers, the
CCR used is 0.2939.
The updated rates and weights are
accessible through the Internet at
https://www.tricare.mil/drgrates. The
implementing regulations for the
TRICARE/CHAMPUS DRG-based
payment system are in 32 CFR part 199.
13:54 Feb 11, 2015
[FR Doc. 2015–02898 Filed 2–11–15; 8:45 am]
AGENCY:
H. Cost to Charge Ratio
VerDate Sep<11>2014
Dated: February 6, 2015.
Aaron Siegel,
Alternate OSD Federal Register Liaison
Officer, Department of Defense.
Jkt 235001
This notice provides the
updated regional per-diem rates for lowvolume mental health providers; the
update factor for hospital-specific perdiems; the updated cap per-diem for
high-volume providers; the beneficiary
per-diem cost-share amount for lowvolume providers; and the updated perdiem rates for both full-day and half-day
TRICARE Partial Hospitalization
Programs for Fiscal Year 2015.
DATES: Effective Date: The Fiscal Year
2015 rates contained in this notice are
effective for services on or after October
1, 2014.
ADDRESSES: Defense Health Agency
(DHA), Medical Benefits and
Reimbursement Branch, 16401 East
Centretech Parkway, Aurora, CO 80011–
9066.
FOR FURTHER INFORMATION CONTACT: Elan
Green, Medical Benefits and
Reimbursement Office, DHA, telephone
(303) 676–3907.
SUPPLEMENTARY INFORMATION: The final
rule published in the Federal Register
(FR) on September 6, 1988 (53 FR
34285) set forth reimbursement changes
that were effective for all inpatient
hospital admissions in psychiatric
hospitals and exempt psychiatric units
occurring on or after January 1, 1989.
The final rule published in the Federal
Register on July 1, 1993 (58 FR 35400)
set forth maximum per-diem rates for all
partial hospitalization admissions on or
after September 29, 1993. Included in
these final rules were provisions for
updating reimbursement rates for each
federal Fiscal Year. As stated in the final
rules, each per-diem shall be updated by
the Medicare update factor for hospitals
and units exempt from the Medicare
SUMMARY:
PO 00000
Frm 00020
Fmt 4703
Sfmt 4703
Prospective Payment System (i.e., this is
the same update factor used for the
inpatient prospective payment system).
For Fiscal Year 2015, the market basket
rate is 2.9 percent. This year, Medicare
applied two reductions to its market
basket amount: (1) A 0.5 percent
reduction for economy-wide
productivity required by section 3401(a)
of the Patient Protection and Affordable
Care Act (PPACA) which amended
section 1886(b)(3)(B) of the Social
Security Act, and (2) a 0.2 percent point
adjustment as required by section
1886(b)(3)(B)(xii) of the Act as added
and amended by sections 3401 and
10319(a) of the PPACA. These two
reductions do not apply to TRICARE.
Hospitals and units with hospitalspecific rates (hospitals and units with
high TRICARE volume) and regionalspecific rates for psychiatric hospitals
and units with low TRICARE volume
will have their TRICARE rates for Fiscal
Year 2015 updated by 2.9 percent.
Partial hospitalization rates for fullday programs also will be updated by
2.9 percent for Fiscal Year 2015. Partial
hospitalization rates for programs of less
than 6 hours (with a minimum of three
hours) will be paid a per diem rate of
75 percent of the rate for a full-day
program.
The cap amount for high-volume
hospitals and units also will be updated
by the 2.9 percent for Fiscal Year 2015.
The beneficiary cost share for lowvolume hospitals and units also will be
updated by the 2.9 percent for Fiscal
Year 2015.
Per 32 CFR 199.14, the same area
wage indexes used for the CHAMPUS
Diagnosis-Related Group (DRG)-based
payment system shall be applied to the
wage portion of the applicable regional
per-diem for each day of the admission.
The wage portion shall be the same as
that used for the CHAMPUS DRG-based
payment system. For wage index values
greater than 1.0, the wage portion of the
regional rate subject to the area wage
adjustment is 69.6 percent for Fiscal
Year 2015. For wage index values less
than or equal to 1.0, the wage portion
of the regional rate subject to the area
wage adjustment is 62.0 percent.
Additionally, 32 CFR 199.14 requires
that hospital specific and regional perdiems shall be updated by the Medicare
update factor for hospitals and units
exempt from the Medicare prospective
payment system.
The following reflect an update of 2.9
percent for Fiscal Year 2015.
E:\FR\FM\12FEN1.SGM
12FEN1
]]>Agencies
[Federal Register Volume 80, Number 29 (Thursday, February 12, 2015)]
[Notices]
[Pages 7844-7846]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-02898]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
Office of the Secretary
TRICARE; Civilian Health and Medical Program of the Uniformed
Services (CHAMPUS); Fiscal Year 2015 Diagnosis Related Group (DRG)
Updates
AGENCY: Office of the Secretary, DoD.
ACTION: Notice of DRG revised rates.
-----------------------------------------------------------------------
SUMMARY: This notice describes the changes made to the TRICARE DRG-
based payment system in order to conform to changes made to the
Medicare Prospective Payment System (PPS). It also provides the updated
fixed loss cost outlier threshold, cost-to-charge ratios, and the data
necessary to update the FY 2015 rates.
DATES: Effective Dates: The rates, weights, and Medicare PPS changes
which affect the TRICARE DRG-based payment system contained in this
notice are effective for discharges occurring on or after October 1,
2014.
ADDRESSES: Defense Health Agency, TRICARE, Medical Benefits and
Reimbursement Office, 16401 East Centretech Parkway, Aurora, CO 80011-
9066.
FOR FURTHER INFORMATION CONTACT: Amber L. Butterfield, Medical Benefits
and Reimbursement Office, TRICARE, telephone (303) 676-3565.
Questions regarding payment of specific claims under the TRICARE
DRG-based payment system should be addressed to the appropriate
contractor.
SUPPLEMENTARY INFORMATION: The final rule published on September 1,
1987 (52 FR 32992) set forth the basic procedures used under the
CHAMPUS DRG-based payment system. This was subsequently amended by
final rules published August 31, 1988 (53 FR 33461); October 21, 1988
(53 FR 41331); December 16, 1988 (53 FR 50515); May 30, 1990 (55 FR
21863); October 22, 1990 (55 FR 42560); and September 10, 1998 (63 FR
48439).
An explicit tenet of these final rules, and one based on the
statute authorizing the use of DRGs by TRICARE, is that the TRICARE
DRG-based payment system is modeled on the Medicare PPS, and that,
whenever practicable, the TRICARE system will follow the same rules
that apply to the Medicare PPS. The Centers for Medicare and Medicaid
Services (CMS) publishes these changes annually in the Federal Register
and discusses in detail the impact of the changes.
In addition, this notice updates the rates and weights in
accordance with our previous final rules. The actual changes we are
making, along with a description of their relationship to the Medicare
PPS, are detailed below.
I. Medicare PPS Changes Which Affect the TRICARE DRG-Based Payment
System
Following is a discussion of the changes CMS has made to the
Medicare PPS that affect the TRICARE DRG-based payment system.
A. DRG Classifications
Under both the Medicare PPS and the TRICARE DRG-based payment
system, cases are classified into the appropriate DRG by a Grouper
program. The Grouper classifies each case into a DRG on the basis of
the diagnosis and procedure codes and demographic
[[Page 7845]]
information (that is, sex, age, and discharge status). The Grouper used
for the TRICARE DRG-based payment system is the same as the current
Medicare Grouper with two modifications. The TRICARE system has
replaced Medicare DRG 435 with two age-based DRGs (900 and 901), and
has implemented thirty-four (34) neonatal DRGs in place of Medicare
DRGs 385 through 390. For admissions occurring on or after October 1,
2001, DRG 435 has been replaced by DRG 523. The TRICARE system has
replaced DRG 523 with the two age-based DRGs (900 and 901). For
admissions occurring on or after October 1, 1995, the CHAMPUS Grouper
hierarchy logic was changed so the age split (age <29 days) and
assignments to Major Diagnostic Category (MDC) 15 occur before
assignment of the pre-MDC DRGs. This resulted in all neonate
tracheostomies and organ transplants to be grouped to MDC 15 and not to
DRGs 480-483 or 495. For admissions occurring on or after October 1,
1998, the CHAMPUS Grouper hierarchy logic was changed to move DRG 103
to the pre-MDC DRGs and to assign patients to pre-MDC DRGs 480, 103,
and 495 before assignment to MDC 15 DRGs and the neonatal DRGs. For
admissions occurring on or after October 1, 2001, DRGs 512 and 513 were
added to the pre-MDC DRGs, between DRGs 480 and 103 in the TRICARE
Grouper hierarchy logic. For admissions occurring on or after October
1, 2004, DRG 483 was deleted and replaced with DRGs 541 and 542,
splitting the assignment of cases on the basis of the performance of a
major operating room procedure. The description for DRG 480 was changed
to ``Liver Transplant and/or Intestinal Transplant'', and the
description for DRG 103 was changed to ``Heart/Heart Lung Transplant or
Implant of Heart Assist System''. For FY 2007, CMS implemented
classification changes, including surgical hierarchy changes. The
TRICARE Grouper incorporated all changes made to the Medicare Grouper,
with the exception of the pre-surgical hierarchy changes, which will
remain the same as FY 2006. For FY 2008, Medicare implemented their
Medicare-Severity DRG (MS-DRG) based payment system. TRICARE, however,
continued with the Centers for Medicare and Medicaid Services DRG-based
(CMS-DRG) payment system for FY 2008. For FY 2009, the TRICARE/CHAMPUS
DRG-based payment system shall be modeled on the MS-DRG system, with
the following modifications.
The MS-DRG system consolidated the 43 pediatric CMS DRGs that were
defined based on age less than or equal to 17 into the most clinically
similar MS-DRGs. In their Inpatient Prospective Payment System final
rule for MS-DRGs, Medicare stated for their population these pediatric
CMS DRGs contained a very low volume of Medicare patients. At the same
time, Medicare encouraged private insurers and other non-Medicare
payers to make refinements to MS-DRGs to better suit the needs of the
patients they serve. Consequently, TRICARE finds it appropriate to
retain the pediatric CMS-DRGs for our population. TRICARE is also
retaining the TRICARE-specific DRGs for neonates and substance use.
For FY09, TRICARE will use the MS-DRG v26.0 pre-MDC hierarchy, with
the exception that MDC 15 is applied after DRG 011-012 and before MDC
24.
For FY10, there are no additional or deleted DRGs.
For FY 11, the added DRGs and deleted DRGs are the same as those
included in CMS' final rule published on August 16, 2010 (75 FR 50041-
50677). That is, DRG 009 is deleted; DRGs 014 and 015 are being added.
For FY 12, the added DRGs and deleted DRGs are the same as those
included in CMS' final rule published on August 18, 2011 (76 FR 51476-
51846). That is, DRG 015 is deleted; DRGs 016 and 017 are being added.
For FY 2013 there are no new, revised, or deleted DRGs.
For FY 2014 there are no new, revised, or deleted DRGs.
For FY 2015 the added, deleted and revised DRGs are the same as
those included in the CMS' final rule published on August 22, 2014, (79
FR 49853-50536), with the exception of endovascular cardiac valve
replacement for which CMS added DRGs 266/267. The TRICARE Grouper
already has DRGs 266/267 assigned to a pediatric procedure therefore
TRICARE added DRGs 317/318, respectively, for endovascular cardiac
valve replacement.
B. Wage Index and Medicare Geographic Classification Review Board
Guidelines
TRICARE will continue to use the same wage index amounts used for
the Medicare PPS. TRICARE will also duplicate all changes with regard
to the wage index for specific hospitals that are redesignated by the
Medicare Geographic Classification Review Board. In addition, TRICARE
will continue to utilize the out commuting wage index adjustment.
C. Revision of the Labor-Related Share of the Wage Index
TRICARE is adopting CMS' percentage of labor related share of the
standardized amount. For wage index values greater than 1.0, the labor
related portion of the Adjusted Standardized Amount (ASA) shall
continue to equal 69.6 percent. For wage index values less than or
equal to 1.0 the labor related portion of the ASA shall continue to
equal 62 percent.
D. Hospital Market Basket
TRICARE will update the adjusted standardized amounts according to
the final updated hospital market basket used for the Medicare PPS for
all hospitals subject to the TRICARE DRG-based payment system according
to CMS' August 22, 2014, final rule. For FY 2015, the market basket is
2.9 percent. Note: Medicare's FY 2015 market basket index adjusts
according to hospitals' compliance with quality data and electronic
health record meaningful use submissions. These adjustments do not
apply to the TRICARE Program.
E. Outlier Payments
Since TRICARE does not include capital payments in our DRG-based
payments (TRICARE reimburses hospitals for their capital costs as
reported annually to the contractor on a pass through basis), we will
use the fixed loss cost outlier threshold calculated by CMS for paying
cost outliers in the absence of capital prospective payments. For FY
2015, the TRICARE fixed loss cost outlier threshold is based on the sum
of the applicable DRG-based payment rate plus any amounts payable for
Indirect Medical Education (IDME) plus a fixed dollar amount. Thus, for
FY 2015, in order for a case to qualify for cost outlier payments, the
costs must exceed the TRICARE DRG base payment rate (wage adjusted) for
the DRG plus the IDME payment (if applicable) plus $22,705 (wage
adjusted). The marginal cost factor for cost outliers continues to be
80 percent.
F. National Operating Standard Cost as a Share of Total Costs
The FY 2015 TRICARE National Operating Standard Cost as a Share of
Total Costs (NOSCASTC) used in calculating the cost outlier threshold
is 0.922. TRICARE uses the same methodology as CMS for calculating the
NOSCASTC; however, the variables are different because TRICARE uses
national cost to charge ratios while CMS uses hospital specific cost to
charge ratios.
[[Page 7846]]
G. Indirect Medical Education (IDME) Adjustment
Passage of the Medical Modernization Act of 2003 modified the
formula multipliers to be used in the calculation of IDME adjustment
factor. Since the IDME formula used by TRICARE does not include
disproportionate share hospitals (DSHs), the variables in the formula
are different than Medicare's, however; the percentage reductions that
will be applied to Medicare's formula will also be applied to the
TRICARE IDME formula. The multiplier for the IDME adjustment factor for
TRICARE for FY 2015 is 1.02.
H. Cost to Charge Ratio
TRICARE uses a national Medicare cost-to-charge ratio (CCR). For FY
2015, the Medicare CCR used for the TRICARE DRG-based payment system
for acute care hospitals and neonates will be 0.2726. This is based on
a weighted average of the hospital-specific Medicare CCRs (weighted by
the number of Medicare discharges) after excluding hospitals not
subject to the TRICARE DRG system (Sole Community Hospitals, Indian
Health Service hospitals, and hospitals in Maryland). The Medicare CCR
is used to calculate cost outlier payments, except for children's
hospitals. The Medicare CCR has been increased by a factor of 1.0065 to
include an additional allowance for bad debt. The 1.0065 factor
reflects the provisions of the Middle Class Tax Relief and Job Creation
Act of 2012. For children's hospital cost outliers, the CCR used is
0.2939.
I. Pricing of Claims
The final rule published on May 21, 2014, (79 FR 29085-29088) set
forth all final claims with discharge dates of October 1, 2014, or
later and reimbursed under the TRICARE DRG-Based payment system, are to
be priced using the rules, weights and rates in effect on as of the
date of discharge. Prior to this, all final claims were priced using
the rules, weights and rates in effective as of the date of admission.
J. Updated Rates and Weights
The updated rates and weights are accessible through the Internet
at https://www.tricare.mil/drgrates. The implementing regulations for
the TRICARE/CHAMPUS DRG-based payment system are in 32 CFR part 199.
Dated: February 6, 2015.
Aaron Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2015-02898 Filed 2-11-15; 8:45 am]
BILLING CODE 5001-06-P
