New Mexico Administrative Code
Title 8 - SOCIAL SERVICES
Chapter 311 - HOSPITAL SERVICES
Part 3 - METHODS AND STANDARDS FOR ESTABLISHING PAYMENT - INPATIENT HOSPITAL SERVICES
Section 8.311.3.12 - PROSPECTIVE PAYMENT METHODOLOGY FOR HOSPITALS
Universal Citation: 8 NM Admin Code 8.311.3.12
Current through Register Vol. 35, No. 18, September 24, 2024
Payment for all covered inpatient services rendered to eligible recipients admitted to acute care hospitals (other than those identified in Subsections C through D of 8.311.3.10 NMAC) on or after October 1, 1989 shall be made based on a prospective payment approach which compensates hospitals an amount per discharge for discharges classified according to the diagnosis related group (DRG) methodology. The prospective rates for each hospital's MAD discharges will be determined by the department in the manner described in the following subsections.
A. Services included in or excluded from the prospective payment rate:
(1)
Prospective payment rates shall constitute payment in full for each MAD
discharge. Hospitals may not separately bill the eligible recipient or the MAD
program for medical services rendered during an inpatient stay, except as
described below. Hospitals may submit a claim for payment only upon the final
discharge of an eligible recipient or upon completion of the transfer of the
eligible recipient to another acute care hospital.
(2) The prospective payment rate shall
include all services provided to hospital inpatients. These services shall
include all items and non-physician services furnished directly or indirectly
to hospital inpatients, such as:
(a)
laboratory services;
(b) pacemakers
and other prosthetic devices, including lenses and artificial limbs, knees and
hips;
(c) radiology services,
including computed tomography (CT) or magnetic resonance imaging (MRI) scans
furnished to an eligible recipient by a physician's office, other hospital or
radiology clinic;
(d)
transportation (including transportation by ambulance) to and from another
hospital or freestanding facility to receive specialized diagnostic or
therapeutic services.
(3) Services which may be billed separately
include:
(a) ambulance service when the
eligible recipient is transferred from one hospital to another and is admitted
as an inpatient to the second hospital;
(b) physician services furnished to an
individual eligible recipient.
B. Computation of DRG relative weights:
(1) Relative weights used for
determining rates for cases paid by DRG under the state plan shall be derived,
to the greatest extent possible, from New Mexico MAD hospital claim data. All
such claims are included in the relative weight computation, except as
described below.
(2) Hospital claim
data for discharges occurring from January 1, 1985 through approximately the
end of calendar year 1988 are included in the computation and prepared as
follows:
(a) claims are edited to merge
interim bills from the same discharge;
(b) all MAD inpatient discharges will be
classified using the DRG methodology, a patient classification system that
reflects clinically cohesive groupings of inpatient cases which consume similar
amounts of hospital resources; claims are assigned to appropriate DRGs using
DRG grouper software;
(c) claims
included in the computation of DRG relative weights were restricted to those
claims for cases to be included in the proposed PPS; claims for services
provided in PPS-exempt hospitals or units (or for services otherwise exempt
from the PPS) were not used to compute DRG relative weights.
(3) Charges for varying years are
adjusted to represent a common year through application of inflation indices as
described in Paragraph (8) of Subsection C of
8.311.3.12
NMAC.
(4) Initial relative weights
are computed by calculation of the average MAD charge for each DRG category
divided by the average charge for all DRGs.
(5) Where the New Mexico MAD-specific claims
and charge data are insufficient to establish a stable relative weight, a
relative weight is imported from other sources such as the CHAMPUS or medicare
prospective payment systems. Weights obtained from external sources are
normalized so that the overall case mix is 1.0.
(6) The relative weights computed as
described above shall remain in effect until the next year. At that time, the
relative weights will be recalculated using the DRG grouper version similar to
the one in use by medicare.
C. Computation of hospital prospective payment rates:
(1)
Rebasing of
rates: Beginning October 1, 1997, the department discontinued the
rebasing of rates every three years. Hospital rates in effect October 1, 1996
were updated by the most current market basket index (MBI) as determined by the
centers for medicare and medicaid services (CMS) for rates effective October 1,
1997 and succeeding years. Thereafter, pursuant to budget availability and at
the department's discretion, the application of the MBI inflation factor will
be reviewed based upon economic conditions and trends. A notice will be sent
annually, informing the provider if an MBI increase or a percentage up to the
MBI is planned for the year. Comments will be accepted by the department prior
to making a final decision.
(2)
Base year discharge and cost data:
(a) The state's fiscal agent will provide the
department with MAD discharges for the provider's last fiscal year which falls
in the calendar year prior to year one.
(b) The state's audit agent will provide MAD
costs incurred, reported, audited, or desk audited for the same
period.
(c) To calculate the total
reimbursable inpatient operating costs from the cost and discharge data
described above, the department will:
(i)
exclude estimated outlier discharges and costs as described in Paragraph (4) of
Subsection C of
8.311.3.12
NMAC;
(ii) exclude pass-through
costs, as identified in the TEFRA provisions and further defined in Paragraph
(3) of Subsection C of
8.311.3.12
NMAC below.
(3)
Definition of excludable costs per
discharge; reduction of excludable capital costs:
(a) The approach used by the department to
define excludable costs parallels medicare's approach. Excludable costs are
defined according to the PPS or TEFRA methodology and include such costs as
those associated with capital, organacquisition, and certified nurse
anesthetists.
(b) The pass-through
capital costs identified using TEFRA provisions will be reduced in a manner
similar to that employed by the medicare PPS. For example, excludable capital
costs for fiscal year 1989 will be reduced by fifteen percent as required by
Section 4006 of the Omnibus Budget Reconciliation Act of 1987. However, any
such reduction to pass-through capital costs will only apply to those costs
incurred after October 1, 1989.
(4)
Outlier adjustment factors:
Hospital-specific outlier adjustment factors will be used to deduct outlier
costs and cases from the total MAD inpatient operating costs and cases used in
rate setting. These factors will be determined by using actual claim and cost
data for outlier cases for the base year period. Only claims for cases to be
paid by DRG will be included in the analysis used to determine this estimate.
The definition of an outlier case can be found in Paragraph (1) of Subsection F
of
8.311.3.12
NMAC.
(5)
Calculation of base
year operating cost per discharge: The total reimbursable inpatient
operating cost (excluding pass-through costs and estimated outlier costs) is
divided by the hospital's number of non-outlier MAD discharges to produce the
base year operating cost per discharge. The base rate methodology is described
below:
BYOR = OC/D
BYOR = base year operating cost per discharge
OC = total Title XIX inpatient operating cost for the base year, less excludable costs and estimated outlier costs
D = MAD discharges for the hospital's base year as provided by the department's fiscal agent, less estimated outlier cases
(6)
Possible use of interim base year
operating cost per discharge rate:
(a)
If the fiscal agent and audit agent have not provided the department with a
hospital's base year discharges and costs as of June 1 prior to year one, the
department will develop an interim operating cost per discharge base rate. This
rate will be developed according to the normal base rate methodology, but using
costs and discharges for the fiscal year prior to the base year.
(b) When an interim rate is developed, the
operating costs per discharge are first multiplied by an inflation index (as
described in Paragraph (8) of Subsection C of
8.311.3.12
NMAC) to bring the costs to the midpoint of the base year. When the provider's
actual base year costs and discharges become available, the department will
calculate a final base year operating cost per discharge using the normal base
rate methodology. The rate that is computed from the final base year operating
costs per discharge will apply to all discharges in year one, retroactive to
the effective date of the interim rate.
(7)
Prohibition against substitution or
rearrangement of base year cost reports:
(a) A hospital's base year cost reports
cannot be substituted or rearranged once the department has determined that the
actual cost submission is suitable. A submission shall be deemed suitable 180
calendar days from the date of the notice of proposed rate (NPR) issued by the
state's intermediary in the absence of an appeal by the hospital to the
intermediary and the state.
(b) In
the event of such an appeal, the state must make a written determination on the
merits of the appeal within 180 calendar days of receipt, although the state
may make a determination to extend such period to a specified date as
necessary. Once such an appeal has been determined, the resulting base cost
will be effective retroactively to year one and will not be changed until
subsequent rebasing of all hospitals has been completed.
(8)
Application of inflation
factors:
(a) The inflation factors used
to update operating costs per discharge will be identical to those established
by congress and adopted for use by CMS to update medicare inpatient prospective
payment rates. The medicare prospective payment update factor (MPPUF) is
determined by CMS, usually on an annual basis, and may differ depending upon
the hospital type (urban, large urban, or rural) as defined by CMS.
(b) Each hospital's base year operating cost
per discharge will be indexed up to the common point of December 31 falling
prior to year one, using the applicable medicare prospective payment update
factors (MPPUF) for that hospital for that period. That is, the inflation
factors used will be identical to those established by congress and adopted for
use by CMS to update medicare inpatient prospective payment rates, including
any established differential for urban and rural hospitals. Then this value
will be indexed using the applicable MPPUF corresponding to the period
beginning October 1 (prior to year one) and ending with the midpoint of
operating year one. For years two and three, the inflation factors will be the
applicable MPPUF as specified by CMS.
(c) For the period October 9, 1991, through
September 30, 1992, an exception to (a) and (b) above was made. The inflation
factor used to update rates for that period is half percent for urban hospitals
and one and a half percent for rural hospitals.
(9)
Case-mix adjustments for base year
operating cost per discharge rate:
(a)
The department will adjust the operating cost per discharge rate to account for
case-mix changes, based on the classification of inpatient hospital discharges
according to the DRG methodology established and used by the medicare
program.
(b) For each DRG, the
department determines a relative value (the DRG relative weight) which reflects
the charges for hospital resources used for the DRG relative to the average
charges of all hospital cases. The department's methodology for computing DRG
relative weights was discussed earlier in Subsection B of
8.311.3.12
NMAC. Case-mix adjustments will be computed using the methodology described
below.
(c)
Case-mix
computation: Each base year, a hospital's case-mix index will be
computed by the department and its fiscal agent as follows:
(i) all MAD discharges are assigned to
appropriate DRGs;
(ii) the case-mix
index is computed for each hospital by summing the products of the case
frequency and its DRG weight and dividing this sum by the total number of title
XIX cases at the hospital.
(d) The case-mix adjustment is applied to the
base year operating cost per discharge as described in Subparagraph (e) of
Paragraph (10) of Subsection C of
8.311.3.12
NMAC below.
(10)
Limitations on operating cost prospective per discharge rates:
(a) Limitations on operating cost prospective
base rates will be imposed using a peer group methodology. Effective October 1,
1989, hospitals will be placed in one of six possible peer groups (teaching,
referral, regional, low-volume regional, community and low-volume community)
based on the following criteria: bed size, case-mix, services available,
population served, location, trauma designation, teaching status, and
low-volume (i.e. less than 150 MAD discharges per year.)
(b) At the time of the next rebasing year
following October 1, 1989, the criteria regarding low-volume utilization was
dropped along with the low-volume peer groups, thus leaving four possible peer
groups for assignment (teaching, referral, regional and community).
(c) The department will determine the peer
group assignment of each hospital, and appeal of such assignment will be
allowed only as described in Paragraph (1) of Subsection D of
8.311.3.12
NMAC.
(d) A ceiling on allowable
operating costs will be set at one hundred ten percent of the median of costs
for all hospitals in the peer group, after application of each hospital's case
mix and indexing of the cost from the hospital's fiscal year end to a common
point of December 31. These adjustments are made to equalize the status of each
hospital for ceiling establishment purposes. The median shall be the midpoint
of rates (or the average of the rates of the two hospitals closest to the
midpoint).
(e) The case-mix
equalization for each hospital in a peer group will be calculated as follows:
PGR = BYOR/CMI
PGR = hospital rate equalized for peer group comparison
BYOR = base year operating cost per discharge
CMI = case-mix index in the base year
(f) The allowable operating cost per
discharge rate (hospital-specific rate) will be the lower of:
(i) the ceiling for the hospital's peer
group; or
(ii) the hospital rate
resulting from the computation found in Subparagraph (e) of Paragraph (10) of
Subsection C of
8.311.3.12
NMAC above.
(11)
Computation of prospective
operating cost per discharge rate: The following formulas are used to
determine the prospective operating cost per discharge rate for years one, two
and three:
Year one
PDO1 = HSR x (1 + MPPUF)
PDO1 = per discharge operating cost rate for year one
HSR = the hospital-specific rate, which is the lower of the peer group ceiling or the hospital's rate, equalized for peer group comparison
MPPUF = the applicable medicare prospective payment update factor as described in Paragraph (8) of Subsection C of 8.311.3.12 NMAC
Year two PDO2 = PDO1 x (1 + MPPUF)
PDO2 = per discharge operating cost rate for year two
PDO1 = per discharge operating cost rate for year one
MPPUF = the applicable medicare prospective payment update factor as described in Paragraph (8) of Subsection C of 8.311.3.12 NMAC
Year three PDO3 = PDO2 x (1 + MPPUF)
PDO3 = per discharge operating cost rate for year three
PDO2 = per discharge operating cost rate for year two
MPPUF = the applicable medicare prospective payment update factor as described in Paragraph (8) of Subsection C of 8.311.3.12 NMAC.
(12)
Computation
of excludable cost per discharge rate: Total MAD excludable cost, as
identified in TEFRA, with excludable capital costs reduced as indicated in
Paragraph (3) of Subsection C of
8.311.3.12
NMAC, will be paid in the following manner:
(a) An excludable cost per discharge rate is
computed using the following methodology:
ER = ECP/DCY
ER = excludable cost per discharge rate
ECP = excludable costs on the hospital's most recently settled cost report prior to the rate year, as determined by the audit agent.
DCY = MAD discharges for the calendar year prior to the rate year, as determined by the department's fiscal agent.
(b) The retrospective settlement will be
determined based on a percentage of the actual allowable amount of MAD
excludable costs incurred by a hospital during the hospital's fiscal year as
determined by the department.
(13)
Computation of prospective per
discharge rate: The excludable cost per discharge, as described in
Paragraph (12) of Subsection C of
8.311.3.12
NMAC above, will be added to the appropriate operating per discharge rates to
determine the prospective rates.
(14)
Effective dates of prospective
rates: Rates were implemented October 1, 1989 and continue to be
effective as of October 1 of each year for each hospital.
(15)
Effect on prospective payment
rates of a change of hospital ownership: When a hospital is sold or
leased, no change is made to the hospital's per discharge rate as a result of
the sale or lease transaction.
(16)
Rate setting for border-area hospitals: Border-area hospitals will
be reimbursed at median rate (including excludable cost pass-throughs) for the
regional peer group.
D. Changes to prospective rates:
(1)
Appeals: Hospitals may appeal for a change in the operating
component of the prospective payment rate, including a change in peer group
assignment, as applicable. For an appeal to be considered, the hospital must
demonstrate in the appeal that:
(a) the
following five requirements are satisfied:
(i)
the hospital inpatient service mix for MAD admissions has changed due to a
major change in scope of facilities and services provided by the
hospital;
(ii) the change in scope
of facilities and services has satisfied all regulatory and statutory
requirements which may be applicable, such as facility licensure and
certification requirements and any other facility or services requirements
which might apply;
(iii) the
expanded services were a) not available to eligible recipients in the area; or
b) are now provided to eligible recipients by the hospital at a lower
reimbursement rate than would be obtained in other hospitals providing the
service;
(iv) the magnitude of the
proposed (as appealed) prospective per discharge rate for the subsequent year
will exceed one hundred five percent of the rate that would have otherwise been
paid to the hospital;
(v) in
addition to requirements Items (i) through (iv) above, appeals for rate
adjustment will not be considered if cost changes are due to changes in
hospital occupancy rate, collective bargaining actions, changes in hospital
ownership or affiliation, or changes in levels of rates of increases of
incurred cost items which were included in the base rate;
(b) the appeal must provide a specific
recommendation(s) regarding the magnitude of alterations in the appellant's
prospective rate per discharge and peer group reassignment, as applicable; in
making its decision on any appeal, the department shall be limited to the
following options:
(i) reject the appeal on
the basis of a failure of the appellant to demonstrate necessary conditions and
documentation for an appeal as specified in Subparagraph (a) of Paragraph (1)
of Subsection D of
8.311.3.12
NMAC above; or
(ii) accept all of
the specific recommendations, as stated in the appeal, in their entirety;
or
(iii) adopt modified versions of
the recommendations as stated in the appeal; or
(iv) reject all of the recommendations in the
appeal;
(c) hospitals
are limited to one appeal per year, which must be filed in writing with the MAD
director by a duly authorized officer of the hospital no later than July 1 of
each year; within 15 calendar days of the filing date, the department shall
offer the appellant the opportunity for hearing of the appeal; if such a
hearing is requested, it shall occur within 30 calendar days of the filing
date; the department shall notify the appellant of the decision of the appeal
in writing no later than September 15 of the year in which the appeal is
filed.
E. Retroactive settlement:
(1)
Retroactive settlement may occur in those cases in which no audited cost
reports were available at the time of rate setting and an interim rate was
used. Retroactive settlement will only occur in those cases where adjustments
to interim rates are required. For year one, the department's audit agent will
determine the difference between payments to the hospital under the interim
operating cost per discharge rate and what these payments would have been under
the final rate. The audit agent will report the amount of overpayment or
underpayment for each facility within 90 calendar days of the effective date of
the final rate. Retroactive settlements will be based on actual claims paid
while the interim rate was in effect.
(2)
Underpayments: In the event
that the interim rate for year one is less than the final rate, the department
will include the amount of underpayment in a subsequent payment to the facility
within 30 calendar days of notification of underpayment.
(3)
Overpayments: In the event
that the interim rate exceeds the final rate, the following procedure will be
implemented: the facility will have 30 calendar days from the date of
notification of overpayment to submit the amount owed to the department in
full. If the amount is not submitted on a timely basis, the department will
begin withholding from future payments until the overpayment is satisfied in
full.
(4) Retroactive settlements
for excludable costs will be handled in the same manner as described
above.
F. Special prospective payment provisions:
(1)
Outlier cases:
(a) For other than
the state teaching hospital, outlier cases are defined as those cases with
medically necessary services exceeding $100,000 in billed charges, or those
with medically necessary lengths of stay of 75 calendar days or more, when such
services are provided to eligible children up to age six in disproportionate
share hospitals, and to eligible infants under age one in all hospitals. For
the state teaching hospital only, the outlier provisions are applied without
regard to age of the recipient in cases with medically necessary services
exceeding $125,000 in billed charges or those medically necessary lengths of
stay of 75 calendar days or more. All cases will be removed from the DRG
payment system and paid at an amount equal to eighty-five percent of the
hospital's standardized cost. Standardized costs are determined by multiplying
the hospital's allowable billed charges by the hospital's cost-to-charge ratio
as calculated from the hospital's most recent cost report.
(b) Utilization review will be performed on
all outlier cases to determine the medical necessity of services rendered.
Should this review determine non-medical necessity for all or part of the
services, these services will be deducted from the billed amount prior to
payment.
(2)
Payment for transfer cases:
(a)
All cases transferred from one acute care hospital to another will be monitored
under a utilization review policy to ensure that the department does not pay
for inappropriate transfers.
(b)
The following methodology will be used to reimburse the transferring and
discharging hospitals for appropriate transfers if both hospitals and any
hospital units involved are included in the PPS.
(i) A hospital inpatient shall be considered
"transferred" when an eligible recipient has been moved from one DRG acute
inpatient facility to another DRG acute inpatient facility. Movement of an
eligible recipient from one unit to another unit within the same hospital shall
not constitute a transfer, unless the eligible recipient is being moved to a
PPS exempt unit within the hospital.
(ii) The transferring hospital will be paid
the lesser of standardized costs or the appropriate DRG payment amount. Should
the stay in the transferring hospital qualify for an outlier payment, then the
case will be paid as an outlier as described in Subsection F of
8.311.3.12
NMAC. Standardized costs are determined by multiplying the hospital's allowable
billed charges by the hospital's cost-to-charge ratio.
(iii) The receiving hospital which ultimately
discharges the eligible recipient will receive the full DRG payment amount, or,
if applicable, any outlier payments associated with the case. All other
hospitals which admitted and subsequently transferred the eligible recipient to
another acute care hospital during a single spell of illness shall be
considered transferring hospitals.
(c) If the transferring or discharge hospital
or unit is exempt from the PPS, that hospital or unit will be reimbursed
according to the method of payment applicable to the particular facility or
unit.
(3)
Payment
for readmissions:
(a) Readmissions that
occur within 24 hours of the previous discharge of an eligible recipient with
the same or related diagnosis related group (DRG) will be considered part of
the prior admission and not paid separately when the admissions are to the same
hospital. When the second admission is to a different hospital, the claims may
be reviewed to determine if the initial claim should be considered as a
transfer.
(b) Readmissions
occurring within 15 calendar days of prior acute care admission for a related
condition may be reviewed to determine medical necessity and appropriateness of
care. If it is determined that either or both admissions were unnecessary or
inappropriate, payment for either or both admissions may be denied. Such review
may be focused to exempt certain cases at the sole discretion of the
department.
(4)
Payment for inappropriate brief admissions: Hospital stays of up
to two calendar days in length may be reviewed for medical necessity and
appropriateness of care. (Discharges involving eligible recipient healthy
mothers and healthy newborns are excluded from this review provision.) If it is
determined that the inpatient stay was unnecessary or inappropriate, the
prospective payment for the inpatient discharge will be denied. If the
inpatient claim is denied, the hospital is permitted to resubmit an outpatient
claim for the services rendered. Such review may be further focused to exempt
certain cases at the sole discretion of the department.
(5)
Payment for non-medically warranted
days:
(a) Reimbursement for eligible
recipients admitted to a hospital receiving services at an inappropriate level
of care will be made at rates reflecting the level of care actually received.
The number of days covered by the MAD program is determined based only upon
medical necessity for an acute level of hospital care.
(b) When it is determined that an eligible
recipient no longer requires acute-level care but does require a lower level of
institutional care, and when placement in such care cannot be located, a DRG
hospital will be reimbursed for "awaiting placement" days. Reimbursement will
be made at the weighted average rate paid by the department in the preceding
calendar year for the level of care needed. There is no limit on the number of
covered "awaiting placement" days as long as those days are medically
necessary. However, the hospital is encouraged to make every effort to secure
appropriate placement for the eligible recipient as soon as possible. During
"awaiting placement" days, no ancillary services will be paid, but medically
necessary physician visits will be reimbursed.
(6)
Indirect medical education (IME)
adjustment: To help cover the cost of residency programs, each acute
care hospital that qualifies as a teaching hospital will receive an IME payment
adjustment, which covers the increased operating or patient care costs that are
associated with approved intern and resident programs. The IME payment
adjustment is subject to available state and federal funding, as determined by
the department and shall not exceed any amounts specified in the
medicaid state plan.
(a) In
order to qualify as a teaching hospital and be deemed eligible for an IME
adjustment, the hospital must:
(i) be licensed
by the state of New Mexico; and
(ii) be reimbursed on a DRG basis under the
plan; and
(iii) have 125 or more
full-time equivalent (FTE) residents enrolled in approved teaching programs or
operate a nationally-accredited primary care residency program.
(b) Determination of a hospital's
eligibility for an IME adjustment will be done annually by the department, as
of the first day of the provider's fiscal year. If a hospital meets the
qualification for an IME adjustment after the start of its fiscal year, it will
be deemed eligible for the IME adjustment beginning on the first day of the
quarter after the date the qualification were met. A determination that a
hospital qualifies as a teaching hospital for IME payments is not to be
construed as the state teaching hospital with regard to DRG outlier payments or
for GME payments.
(c) The IME
payment will be calculated separately for regular medicaid and group VIII (the
other adult group who are newly eligible for medicaid under the affordable care
act).
(d) The IME payment amount by
population group is determined by multiplying DRG operating payments for each
group, which are DRG payments and outlier payments, by the IME adjustment
factor computed by the following formula:
1. 89*((1+R).405-1)
where R equals the number of approved full-time equivalent (FTE) residents divided by the number of available beds (excluding nursery and neonatal bassinets). FTE residents are counted in accordance with 42 CFR 412.105(f), except that the limits on the total number of FTE residents in 42 CFR 412.10(f)(1)(iv) shall not apply, and at no time shall exceed 450 FTE residents. For purposes of this paragraph, DRG operating payments include the estimated average per discharge amount that would otherwise have been paid for MAD managed care enrollees if those persons had not been enrolled in managed care.
(e) Quarterly IME
payments will be made to qualifying hospitals at the end of each quarter. Prior
to the end of each quarter, the provider will submit to the department's audit
agent the information necessary to make the calculation, i.e. number of beds,
number of estimated residents for the quarter, and the MAD DRG amount. After
review and adjustment, if necessary, the audit agent will notify the department
of the amount due to/from the provider for the application quarter. Final
settlement of the IME adjustment amount will be made through the cost report;
that is, the number of beds, residents, and DRG amounts used in the quarterly
calculation will be adjusted to the actual numbers shown on the provider's cost
report for those quarters.
(7)
Payment for direct graduate medical
education (GME): For services provided on or after July 1, 1998, payment
to hospitals for GME expense is made on a prospective basis as described in
this section. Payments will be made quarterly to qualifying hospitals, at a
rate determined by the number of resident full-time-equivalents (FTEs) in the
various categories defined below, who worked at the hospital during the
preceding year, and subject to an upper limit on total payments. The GME
payment is subject to available state and federal funding, as determined by the
department, and shall not exceed any amounts specified in the medicaid
state plan.
(a) To be counted for MAD
reimbursement, a resident must be participating in an approved medical
residency program, as defined by medicare in 42 CFR 413.75. With regard to
categorizing residents, as described in Subparagraph (b) of Paragraph (9)
below, the manner of counting and weighting resident FTEs will be the same as
is used by medicare in 42 CFR 413.79 except that the number of FTE residents
shall not be subject to the FTE resident cap described in 42 CFR 413.79(b)(2).
Resident FTEs whose costs will be reimbursed by the department as a medical
expense to a federally qualified health center are not eligible for
reimbursement under this section. To qualify for MAD GME payments, a hospital
must be licensed by the state of New Mexico, be currently enrolled as a MAD
provider, and must have achieved a MAD inpatient utilization rate of five
percent or greater during its most recently concluded hospital fiscal year. For
the purposes of this section, the MAD inpatient utilization rate will be
calculated as the ratio of New Mexico MAD eligible days, including inpatient
days paid under MAD managed care arrangements, to total inpatient hospital
days.
(b) Approved resident FTEs
are categorized as follows for MAD GME payment:
(i)
Primary care/obstetrics
resident: Primary care is defined per 42 CFR 413.75(b).
(ii)
Rural health resident: A
resident is defined as participating in a designated rural health residency
program. Residents enrolled in a designated rural health residency program will
be counted as a rural health resident FTE for the entire duration of their
residency, including those portions of their residency which may be served in a
non-rural hospital or clinic. Should any resident meet the criteria for both
rural health and primary care in this section, this resident will be counted as
a rural health resident.
(iii)
Other approved resident: Any resident not meeting the criteria in
Items (i) or (ii), above.
(c)
MAD GME payment amount per resident
FTE:
(i) The annual MAD payment amount
per resident FTE with state fiscal year 2017 is as follows:
Primary care/obstetrics resident: $41,000
Rural health resident: $52,000
Other resident: $50,000
(ii) The per resident amounts specified in
Item (i) of Subparagraph (c) of Paragraph (9) of Subsection F of
8.311.3.11
NMAC will be inflated for state fiscal years beginning on or after July 1, 2017
using the annual inflation update factor described in Item (ii) of Subparagraph
(d) of Paragraph (7) of Subsection F of
8.311.3.11
NMAC.
(d)
Annual
inflation update factor:
(i) Effective
for state fiscal years 2000 and beyond, the department has updated the per
resident GME amounts and the upper limit on GME payments for inflation, using
the market basket forecast published in the CMS Dallas regional medical
services letter issued for the quarter ending in March 1999 to determine the
GME rates for state fiscal year 2000 (July 1, 1999 - June 30, 2000).
(ii) The department will use the market
basket forecast shown for PPS hospitals that is applicable to the period during
which the rates will be in effect. MAD will determine the percentage of funds
available for GME payments to eligible hospitals.
(e)
Annual upper limits on GME
payments:
(i) Total annual MAD GME
payments will be limited to $18,500,000 for state fiscal year 2017. This amount
will be updated for inflation, beginning with state fiscal year 2018, in
accordance with Subparagraph (d) of Paragraph (7) of Subsection F of
8.311.3.11
NMAC.
(ii) Total annual GME
payments for residents in Category B.3, "Other," will be limited to the
following percentages of the $18,500,000 total annual limit (as updated for
inflation in accordance with Subparagraph (d) of Paragraph (7) of Subsection F
of
8.311.3.11
NMAC):
state fiscal year1999 58.3
percent state fiscal year 2000 56.8
percent state fiscal year 2001 53.3
percent state fiscal year 2002 50.7
percent state fiscal year 2003 48.0
percent state fiscal year 2004 45.5
percent state fiscal year 2005 43.0
percent state fiscal year 2006 40.4
percent state fiscal year 2017 and thereafter no limit
(f)
Allocation Methodology: The result of the GME payment calculation
will be allocated between regular medicaid and group VIII (the other adult
group who are newly eligible for medicaid under the affordable care act) based
on the medicaid enrollment ratio from the most recent available
quarter.
(g)
Reporting and
payment schedule:
(i) Hospitals will
count the number of residents working according to the specification in this
part during each fiscal year (July 1 through June 30) and will report this
information to the department by December 31. Counts will represent the
weighted average number of residents who worked in the hospitals during the
specified 12-month period. Hospitals may also add to this count any FTEs
associated with newly approved residency programs that will be implemented on
or before the start of the prospective GME payment year, to the extent that
these FTEs are not already reflected in the weighted average counts of the
preceding year. To illustrate, resident FTE amounts would be counted from
07/01/96 - 06/30/97 for the payment year 07/01/98 - 06/30/99. The department
may require hospitals to provide documentation necessary to support the summary
counts provided.
(ii) The
department will establish the amount payable to each hospital for the
prospective payment period that will begin each July 1. Should total payments
as initially calculated exceed either of the limitations in Subsection D of
8.311.3.11
NMAC, the amount payable to each will be proportionately reduced.
(iii) The annual amount payable to each
hospital is divided into four equal payments. These payments will be made by
the department on or about the start of each prospective payment
quarter.
(iv) Should a facility not
report timely with the accurate resident information as required in Item (i) of
Subparagraph (f) of Paragraph (7) of Subsection F of
8.311.3.11
NMAC above, it will still be entitled to receive payment for any quarter yet
remaining in the prospective payment year, after acceptable information has
been submitted. However, payments to untimely reporting facilities will be
limited to the amount of funds that remain available under the upper limits
described in Subsection D of
8.311.3.11
NMAC, after prospective payment amounts to timely filing facilities have been
established.
Disclaimer: These regulations may not be the most recent version. New Mexico may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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