Nebraska Administrative Code
Topic - HEALTH AND HUMAN SERVICES SYSTEM
Title 471 - NEBRASKA MEDICAL ASSISTANCE PROGRAM SERVICES
Chapter 46 - RATES FOR HOSPITAL SERVICES
Section 471-46-003 - PAYMENT FOR PEER GROUPS 1, 2, AND 3 METRO ACUTE, OTHER URBAN ACUTE, AND RURAL ACUTE

003.01(A) CALCULATION OF THE APR-DIAGNOSIS RELATED GROUP WEIGHTS. For dates of service on or after July 1, 2014, the Department will use the All-Patient Refined Diagnosis Related Groups classifications. The National Weights published by 3M will be applied to the all patient refined-diagnosis related groups. The National Weights are calculated using the nationwide inpatient sample released by the healthcare cost and utilization project. The Department will annually update the all patient refined-diagnosis related group grouper and national relative weights with the most current available version.

003.01(B) CALCULATION OF NEBRASKA PEER GROUP BASE PAYMENT AMOUNTS. Peer group base payment amounts are used to calculate payments for discharges with a diagnosis related group. Peer group base payment amounts effective July 1, 2016, are calculated for peer group 1, 2 and 3 hospitals based on the peer group base payment amounts effective during state fiscal year 2011, adjusted for budget neutrality, calculated as follows: peer group 1 base payment amounts, excluding children's hospitals: multiply the state fiscal year 2011 peer group 1 base payment amount of $4, 397.00 by the diagnosis related group budget neutrality factor. Children's hospital peer group 1 base payment amounts: multiply the state fiscal year 2011 children's hospital peer group 1 base payment amount of $5, 278.00 by the diagnosis related group budget neutrality factor. Peer group 2 base payment amounts: multiply the state fiscal year 2011 peer group 2 base payment amount of $4, 270.00 by the diagnosis related group budget neutrality factor. Peer group 3 base payment amounts: multiply the state fiscal year 2011 peer group 3 base payment amount of $4, 044.00 by the diagnosis related group budget neutrality factor. State fiscal year 2007 Nebraska peer group base payment amounts are described in this chapter. Peer group base payment amounts excluding the 0.5% increase for the rate period beginning October 1, 2009 and ending June 30, 2010, will be increased by.5% for the rate period beginning July 1, 2010. The peer group base payment amount is subject to annual adjustment as specified by the Department.

003.02(A) HOSPITAL SPECIFIC MEDICARE OUTLIER CCRS. The Department will extract from the Center for Medicaid and Medicaid Services Prospective Payment System Inpatient Pricer Program the hospital-specific Medicare operating and capital outlier cost-to-charge ratios effective October 1 of the year preceding the start of the Nebraska rate year.

003.02(B) OUTLIER CCRS UPDATES. On July 1 of each year, the Department will update the outlier costs based on the Medicare outlier cost-to-charge ratios effective October 1 of the previous year.

003.03(A) CALCULATION OF DIRECT MEDICAL EDUCATION COST PAYMENTS. Direct Medical Education payments effective October 1, 2009 are based on Nebraska hospital-specific direct medical education payment rates effective during state fiscal year 2007 with the following adjustments: Estimate state fiscal year 2007 direct medical education payments for in-state teaching hospitals by applying state fiscal year 2007 direct medical education payment rates to state fiscal year 2007 Nebraska Medicaid inpatient fee-for-service paid claims data. Include all patient refined-diagnosis related group discharges except psychiatric, rehabilitation and Medicaid Capitated Plans discharges. Divide the estimated state fiscal year 2007 direct medical education payments for each hospital by each hospital's number of intern and resident full time equivalents effective in the Medicare system on October 1, 2006. Multiply the state fiscal year 2007 direct medical education payment per intern and resident full time equivalent by each hospital's number of intern and resident full time equivalents effective in the Medicare inpatient system on October 1, 2008. Divide the direct medical education payments adjusted for full time equivalents effective October 1, 2008 by each hospital's number of state fiscal year 2007 claims. Multiply the direct medical education payment rates by the stable diagnosis related group budget neutrality factor. On July 1st of each year, the Department will update direct medical education payment rates by replacing each hospital's intern and resident full time equivalents effective in the Medicare inpatient system on October 1, 2008, as described in step 3 of this subsection, with each hospital's intern and resident full time equivalents effective in the Medicare inpatient system on October 1 of the previous year. The direct medical education payment amount will be increased by 0.5% effective October 1, 2009 through June 30, 2010. This rate increase will not be carried forward in subsequent years. The direct medical education payment amount, excluding the 0.5% increase effective October 1, 2009 through June 30, 2009, will be increased by.5% for the rate period beginning July 1, 2010. The direct medical education payment amount is subject to annual adjustment as specified by the Department.

003.03(B) CALCULATION OF INDIRECT MEDICAL EDUCATION COST PAYMENTS. Hospitals qualify for indirect medical education payments when they receive a direct medical education payment from Medicaid, and qualify for indirect medical education payments from Medicare. Recognition of indirect medical education costs incurred by hospitals are an add-on calculated by multiplying an indirect medial education factor by the operating cost payment amount. The indirect medical education factor is the Medicare inpatient prospective payment system operating indirect medial education factor effective October 1 of the year preceding the beginning of the Nebraska rate year. The operating indirect medical education factor shall be determined using data extracted from the Center for Medicare and Medicaid Services Prospective Payment System Inpatient Pricer Program using the following formula: Number of interns and residents divided by available beds; plus 1; to the power of 0.405; minus 1; multiplied by 1.35.

003.03(C) CALCULATION OF MANAGED CARE ORGANIZATION MEDICAL EDUCATION PAYMENTS. Medicaid will calculate annual MCO Direct Medical Education payments and managed care organization indirect medical education payments for services provided by Medicaid capitated plans from discharge data provided by the managed care organization. Managed care organization direct medical education payments will be equal to the number of managed care organization discharges times the fee-for service direct medical education payment per discharge in effect for the rate year July 1 through June 30. Managed care organization indirect medical education payments will be equal to the number of managed care organization discharges times the managed care organization indirect medical education payment per discharge. The indirect medical education payment per discharge is calculated as follows. Subtotal each teaching hospital's fee-for-service inpatient acute indirect medical education prior year payments. Subtotal each teaching hospital's fee-for-service inpatient covered prior state fiscal year charges. Divide each teaching hospital's indirect medical education payments, by covered prior state fiscal year charges. Multiply this ratio times the covered charges in managed care organization paid claims in the base year. Divide this amount by the number of managed care organization paid claims in the base year.

003.03(D) CALCULATION OF CAPITAL-RELATED COST PAYMENT. Capital-related cost payments for the building and fixtures portion of capital-related costs are paid on a per discharge basis. Per discharge amounts are calculated by multiplying the capital per diem cost by the statewide average length-of-stay for the diagnosis related group. Capital-related payment per diem amounts effective July 1, 2009 are calculated for Peer Group 1, 2 and 3 hospitals based on the capital-related payment per diem amounts effective during state fiscal year 2007, adjusted for budget neutrality, as follows: Peer Group 1 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 1 Capital-related payment per diem amount of $ 36.00 by the Stable diagnosis related group budget neutrality factor. Peer Group 2 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 2 Capital-related payment per diem amount of $ 31.00 by the stable diagnosis related group budget neutrality factor. Peer Group 3 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 3 Capital-related payment per diem amount of $ 18.00 by the Stable diagnosis related group budget neutrality factor. Capital Related Per Diem Amounts are subject to annual adjustments as specified by the Department.

003.03(E) TRANSPLANT DIAGNOSIS RELATED GROUP PAYMENTS. Transplant discharges, identified as discharges that are classified to a transplant diagnosis related group, are paid a transplant diagnosis related group cost-to-charge ratio payment and, if applicable, a direct medical education payment. Transplant diagnosis related group discharges do not receive separate cost outlier payments, independent medical examination cost payments or capital-related cost payments.

003.03(F) BUDGET NEUTRALITY FACTORS. Peer Group Base Payment Amounts, are multiplied by budget neutrality factors, determined as follows:

003.03(G) FACILITY SPECIFIC UPPER PAYMENT LIMIT. Facilities in Peer Groups 1, 2, and 3 are subject to an upper payment limit for all cost reporting periods ending after January 1, 2001. For each cost reporting period, Medicaid payment for inpatient hospital services shall not exceed 110% of Medicaid cost. Medicaid cost shall be the calculated sum of Medicaid allowable inpatient routine and ancillary service costs. Medicaid routine service costs are calculated by allocating total hospital routine service costs for each applicable routine service cost center Medicaid inpatient ancillary service costs are calculated by multiplying an overall ancillary cost-to-charge ratio times the applicable Medicaid program inpatient ancillary charges. The overall ancillary cost-to-charge ratio is calculated by dividing the sum of the costs of all ancillary and outpatient service cost centers by the sum of the charges for all ancillary and outpatient service cost centers. Payments shall include all operating cost payments, capital related cost payments, direct medical education cost payments, indirect medical education cost payments, cost outlier payments, and all payments received from other sources for hospital care provided to Medicaid eligible patients. Payment under Medicaid shall constitute reimbursements under this subsection for days of service that occurred during the cost reporting period.

003.03(H) TRANSFERS. When a patient is transferred to or from another hospital, the Department shall make a transfer payment to the transferring hospital if the initial admission is determined to be medically necessary. For hospital inpatient services reimbursed on a prospective discharge basis, the transfer payment is calculated based on the average daily rate of the transferring hospital's payment for each day the patient remains in that hospital, up to 100 % of the full diagnosis related group payment. The average daily rate is calculated as the full diagnosis related group payment, which is the sum of the operating cost payment amount, capital-related cost payment, and if applicable, direct medical education cost payment, divided by the statewide average length-of-stay for the related diagnosis related group. For hospitals receiving a transferred patient, payment is the full diagnosis related group payment and, if applicable, cost outlier payment.

003.03(I) INPATIENT ADMISSION AFTER OUTPATIENT SERVICES. A patient may be admitted to the hospital as an inpatient after receiving hospital outpatient services. When a patient is admitted as an inpatient within three calendar days of the day that the hospital outpatient services were provided, all hospital outpatient services related to the principal diagnosis are considered inpatient services for billing and payment purposes. The day of the admission as an inpatient is the first day of the inpatient hospitalization.

003.03(J) READMISSIONS. Medicaid adopts Medicare peer review organization regulations to control increased admissions or reduced services. All Medicaid patients readmitted as an inpatient within 31 days will be reviewed by the Department or its designee. Payment may be denied if either admissions or discharges are performed without medical justification as determined medical review.

003.03(K) INTERIM PAYMENT FOR LONG-STAY PATIENTS. Medicaid's payment for hospital inpatient services is made upon the patient's discharge from the hospital. Occasionally, a patient may have an extremely long stay, in which partial reimbursement to the hospital may be necessary. A hospital may request an interim payment if the patient has been hospitalized 60 days and is expected to remain hospitalized an additional 60 days. To request an interim payment, the hospital shall send a completed Form HCFA-1450, UB-92, for the hospital days for which the interim payment is being requested with an attestation by the attending physician that the patient has been hospitalized a minimum of 60 days and is expected to remain hospitalized a minimum of an additional 60 days. The hospital shall send the request for interim payment to the Department of Health and Human Services Finance and Support. The hospital will be notified in writing if the request for interim payment is denied.

003.03(L) PAYMENT FOR NON-PHYSICIAN ANESTHETIST FEES. Hospitals which meet the Medicare exception for payment of certified registered nurse anesthetist fees as a pass-through by Medicare will be paid for certified registered nurse anesthetist fees in addition to their prospective per discharge payment. The additional payment will equal 85% of the hospital's costs for certified registered nurse anesthetist services. Costs will be calculated using the hospital's specific anesthesia cost-to-charge ratio. Certified registered nurse anesthetist fees must be billed using revenue code 964 - Professional Fees Anesthetist on the HCFA-1450, UB-92, claim form.