[Federal Register Volume 62, Number 201 (Friday, October 17, 1997)]
[Notices]
[Pages 54131-54138]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-27629]


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OFFICE OF MANAGEMENT AND BUDGET


Cost of Hospital and Medical Care Treatment Furnished by the 
United States; Certain Rates Regarding Recovery From Tortiously Liable 
Third Persons

    By virtue of the authority vested in the President by section 2(a) 
of Pub. L. 87-693 (76 Stat. 593; 42 U.S.C. 2652), and delegated to the 
Director of the Office of Management and Budget by Executive Order No. 
11541 of July 1, 1970 (35 FR 10737), the three sets of rates outlined 
below are hereby established. These rates are for use in connection 
with the recovery, from tortiously liable third persons, of the cost of 
hospital and medical care and treatment furnished by the United States 
(Part 43, Chapter I, Title 28, Code of Federal Regulations) through 
three separate Federal agencies. The rates have been established in 
accordance with the requirements of OMB Circular A-25, requiring 
reimbursement of the full cost of all services provided. The rates are 
established as follows:

1. Department of Defense

    The Fiscal Year 1998 (FY98) Department of Defense (DoD) 
reimbursement rates for inpatient, outpatient, and other services are 
provided in accordance with Section 1095 of title 10, United States 
Code. Due to size, the sections containing the Drug Reimbursement Rates 
(Section III.D) and the rates for Ancillary Services Requested by 
Outside Providers (Section III.E) are not included in this package. The 
Office of the Assistant Secretary of Defense (Health Affairs) will 
provide these rates upon request. The medical and dental service rates 
in this package (including the rates for ancillary services, 
prescription drugs or other procedures requested by outside providers) 
are effective October 1, 1997.

2. Health and Human Services

    The sum of obligations for each cost center providing medical 
service is broken down into amounts attributable to inpatient care on 
the basis of the proportion of staff devoted to each cost center. Total 
inpatient costs and outpatient costs thus determined are

[[Page 54132]]

divided by the relevant workload statistic (inpatient day, outpatient 
visit) to produce the inpatient and outpatient rates. In calculation of 
the rates, the Department's unfunded retirement liability cost and 
capital and equipment depreciation cost were incorporated to conform to 
requirements set forth in OMB Circular A-25. In addition, each cost 
center's obligations include costs for certain other accounts, such as 
Medicare and Medicaid collections and Contract Health funds used to 
support direct program operation. Certain cost centers that primarily 
support workload outside of the directly operated hospitals or clinics 
(public health nursing, public health nutrition, health education) were 
excluded this year as not being a part of the traditional cost of 
hospital operations and not contributing directly to the inpatient and 
outpatient visit workload. Overall, these rates reflect a more accurate 
indication of the cost of care in HHS facilities.
    In addition, separate rates per inpatient day and outpatient visit 
were computed for Alaska and the rest of the United States. This gives 
proper weight to the higher cost of operating medical facilities in 
Alaska.

3. Department of Veterans Affairs

    Actual direct and indirect costs are compiled by type of care for 
the previous year, and facility overhead costs are added. Adjustments 
are made using the budgeted percentage changes for the current year and 
the budget year to compute the base rate for the budget year. The 
budget year base rate is then adjusted by estimated costs for 
depreciation of buildings and equipment, central office overhead, 
Government employee retirement benefits, and return on fixed assets 
(interest on capital for land, buildings, and equipment (net book 
value)), to compute the budget year tortiously liable reimbursement 
rates. Also shown for the tortiously liable inpatient per diem rates 
are breakdowns into three cost components: Physician; Ancillary; and 
Nursing, Room, and Board. As with the total per diem rates, these 
breakdowns are calculated from actual data by type of care.
    The interagency rates shown are to be used when VA medical care or 
service is furnished to a beneficiary of another Federal agency, and 
that care or service is not covered by an applicable local sharing 
agreement. Government employee retirement benefits and return on fixed 
assets are not included in the interagency rates, but in all other 
respects the interagency rates are the same as the tortiously liable 
rates.
    Inpatient charges will be at the per diem rates shown for the type 
of bed section or discrete treatment unit providing the care. 
Prescription Filled charge in lieu of the Outpatient Visit rate will be 
charged when the patient receives no service other than the Pharmacy 
outpatient service. This charge applies whether the patient receives 
the prescription in person or by mail.
    When medical care or service is obtained at the expense of the 
Department of Veterans Affairs from a non-VA source, the charge for 
such care or service will be the actual amount paid by the VA for that 
care or service.

1. Department of Defense

    For the Department of Defense, effective October 1, 1997 and 
thereafter:

Inpatient, Outpatient and Other Rates and Charges

I. Inpatient Rates 1 2

----------------------------------------------------------------------------------------------------------------
                                                                   International    Interagency                 
                                                                     Military        and other                  
                        Per inpatient day                           Education &   Federal agency   Other (Full/ 
                                                                     Training        sponsored     Third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
A. Burn Center..................................................       $2,618.00       $4,754.00       $5,079.00
B. Surgical Care Services (Cosmetic Surgery)....................          955.00        1,733.00         1852.00
C. All Other Inpatient Services (Based on Diagnosis Related                                                     
 Groups (DRG) \3\)                                                                                              
----------------------------------------------------------------------------------------------------------------

1. FY98 Direct Care Inpatient Reimbursement Rates

----------------------------------------------------------------------------------------------------------------
                                                                                       Other        (Full/Third 
                    Adjusted standard amount                           IMET         interagency       party)    
----------------------------------------------------------------------------------------------------------------
Large Urban.....................................................       $2,199.00       $4,131.00       $4,372.00
Other Urban/Rural...............................................        2,194.00        4,215.00        4,499.00
Overseas........................................................        2,450.00        5,614.00        5,960.00
----------------------------------------------------------------------------------------------------------------

2. Overview
    The FY98 inpatient rates are based on the cost per DRG, which is 
the inpatient full reimbursement rate per hospital discharge weighted 
to reflect the intensity of the principal diagnosis, secondary 
diagnoses, procedures, patient age, etc. involved. The average cost per 
Relative Weighted Product (RWP) for large urban, other urban/rural, and 
overseas facilities will be published annually as an inpatient adjusted 
standardized amount (ASA) (see paragraph I.C.1., above). The ASA will 
be applied to the RWP for each inpatient case, determined from the DRG 
weights, outlier thresholds, and payment rules published annually for 
hospital reimbursement rates under the Civilian Health and Medical 
Program of the Uniformed Services (CHAMPUS) pursuant to 32 CFR 
199.14(a)(1), including adjustments for length of stay (LOS) outliers. 
The published ASAs will be adjusted for area wage differences and 
indirect medical education (IME) for the discharging hospital. An 
example of how to apply DoD costs to a DRG standardized weight to 
arrive at DoD costs is contained in paragraph I.C.3., below.
3. Example of Adjusted Standardized Amounts for Inpatient Stays
    Figure 1 shows examples for a nonteaching hospital in a Large Urban 
Area.

[[Page 54133]]

    a. The cost to be recovered is DoD's cost for medical services 
provided in the nonteaching hospital located in a large urban area. 
Billings will be at the third party rate.
    b. DRG 020: Nervous System Infection Except Viral Meningitis. The 
RWP for an inlier case is the CHAMPUS weight of 2.9769. (DRG statistics 
shown are from FY 1996).
    c. The DoD adjusted standardized amount to be charged is $4,372 
(i.e., the third party rate as shown in the table).
    d. DoD cost to be recovered at a nonteaching hospital with area 
wage index of 1.0 is the RWP factor (2.9769) in 3.b., above, multiplied 
by the amount ($4,372) in 3.c., above.
    e. Cost to be recovered is $13,015.

                                     Figure 1.--Third Party Billing Examples                                    
----------------------------------------------------------------------------------------------------------------
                                                           Arithmetic     Geometric    Short stay     Long stay 
     DRG No.           DRG description       DRG weight     mean LOS      mean LOS      threshold     threshold 
----------------------------------------------------------------------------------------------------------------
020..............  Nervous System                2.9769          11.2           7.8             1            30 
                    Infection Except Viral                                                                      
                    Meningitis.                                                                                 
----------------------------------------------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                            Area wage        IME                                
             Hospital                     Location         rate index    adjustment     Group ASA    Applied ASA
----------------------------------------------------------------------------------------------------------------
Nonteaching Hospital..............  Large Urban.........          1.0           1.0     $4,372.00     $4,372.00 
----------------------------------------------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                                  Relative weighted product              TPC    
      Patient            Length of stay      Days above  -------------------------------------------------------
                                              threshold     Inlier *     Outlier **       Total      Amount *** 
----------------------------------------------------------------------------------------------------------------
#1.................  7 days...............            0        2.9769        0.0000        2.9769       $13,015 
#2.................  21 days..............            0        2.9769        0.0000        2.9769        13,015 
#3.................  35 days..............            5        2.9769        0.6297        3.6066       15,768  
----------------------------------------------------------------------------------------------------------------
*DRG Weight                                                                                                     
**Outlier calculation = 33 percent of per diem weight' number of outlier days = .33 (DRG Weight/Geometric Mean  
  LOS)' (Patient LOS--Long Stay Threshold)                                                                      
=.33 (2.9769/7.8) ' (35-30)                                                                                     
=.33 (.38165)' 5 (take out to five decimal places)                                                              
=.12594' 5 (take out to five decimal places)                                                                    
=.6297 (take out to four decimal places)                                                                        
*** Applied ASA' Total RWP                                                                                      

II. Outpatient Rates 1 2 Per Visit

----------------------------------------------------------------------------------------------------------------
                                                                   International    Interagency                 
                                                                     Military        and other                  
        MEPRS Code \4\                  Clinical service            Education &   Federal agency   Other  (Full/
                                                                     Training        sponsored     Third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
                                                 A. Medical Care                                                
----------------------------------------------------------------------------------------------------------------
BAA...........................  Internal Medicine...............         $105.00         $195.00         $208.00
BAB...........................  Allergy.........................           39.00           73.00           78.00
BAC...........................  Cardiology......................           81.00          150.00          160.00
BAE...........................  Diabetic........................           44.00           82.00           87.00
BAF...........................  Endocrinology (Metabolism)......           85.00          158.00          168.00
BAG...........................  Gastroenterology................          110.00          203.00          216.00
BAH...........................  Hematology......................          145.00          269.00          287.00
BAI...........................  Hypertension....................           81.00          149.00          159.00
BAJ...........................  Nephrology......................          171.00          317.00          338.00
BAK...........................  Neurology.......................          109.00          202.00          215.00
BAL...........................  Outpatient Nutrition............           34.00           63.00           67.00
BAM...........................  Oncology........................          114.00          211.00          225.00
BAN...........................  Pulmonary Disease...............          141.00          260.00          278.00
BAO...........................  Rheumatology....................           84.00          156.00          166.00
BAP...........................  Dermatology.....................           63.00          117.00          124.00
BAQ...........................  Infectious Disease..............          141.00          260.00          278.00
BAR...........................  Physical Medicine...............           78.00          145.00          155.00
BAS...........................  Radiation Therapy...............           72.00          132.00          141.00
BAZ...........................  Medical Care Not Elsewhere                 84.00          156.00          166.00
                                 Classified (NEC).                                                              
----------------------------------------------------------------------------------------------------------------
                                                B. Surgical Care                                                
----------------------------------------------------------------------------------------------------------------
BBA...........................  General Surgery.................          119.00          220.00          235.00
BBB...........................  Cardiovascular and Thoracic               110.00          203.00          216.00
                                 Surgery.                                                                       
BBC...........................  Neurosurgery....................          137.00          253.00          270.00
BBD...........................  Ophthalmology...................           84.00          155.00          166.00
BBE...........................  Organ Transplant................          191.00          353.00          376.00
BBF...........................  Otolaryngology..................           88.00          162.00          173.00
BBG...........................  Plastic Surgery.................          100.00          184.00          196.00
BBH...........................  Proctology......................           67.00          124.00          132.00

[[Page 54134]]

                                                                                                                
BBI...........................  Urology.........................          101.00          187.00          199.00
BBJ...........................  Pediatric Surgery...............           89.00          164.00          175.00
BBZ...........................  Surgical Care NEC...............           65.00          120.00          127.00
----------------------------------------------------------------------------------------------------------------
                                 C. Obstetrical and Gynecological (OB-GYN) Care                                 
----------------------------------------------------------------------------------------------------------------
BCA...........................  Family Planning.................           45.00           83.00           89.00
BCB...........................  Gynecology......................           74.00          136.00          146.00
BCC...........................  Obstetrics......................           68.00          126.00          135.00
BCZ...........................  OB-GYN Care NEC.................          112.00          207.00         221.00D
----------------------------------------------------------------------------------------------------------------
                                                D. Pediatric Care                                               
----------------------------------------------------------------------------------------------------------------
BDA...........................  Pediatric.......................           54.00          100.00          106.00
BDB...........................  Adolescent......................           55.00          101.00          108.00
BDC...........................  Well Baby.......................           36.00           66.00           70.00
BDZ...........................  Pediatric Care NEC..............           64.00          119.00          126.00
----------------------------------------------------------------------------------------------------------------
                                               E. Orthopaedic Care                                              
----------------------------------------------------------------------------------------------------------------
BEA...........................  Orthopaedic.....................           83.00          153.00          164.00
BEB...........................  Cast............................           45.00           82.00           88.00
BEC...........................  Hand Surgery....................           38.00           70.00           75.00
BEE...........................  Orthotic Laboratory.............           59.00          110.00          117.00
BEF...........................  Podiatry........................           49.00           91.00           97.00
BEZ...........................  Chiropractic....................           21.00           38.00           40.00
----------------------------------------------------------------------------------------------------------------
                                    F. Psychiatric and/or Mental Health Care                                    
----------------------------------------------------------------------------------------------------------------
BFA...........................  Psychiatry......................           97.00          179.00          191.00
BFB...........................  Psychology......................           71.00          132.00          141.00
BFC...........................  Child Guidance..................           59.00          109.00          117.00
BFD...........................  Mental Health...................           80.00          147.00          157.00
BFE...........................  Social Work.....................           80.00          149.00          159.00
BFF...........................  Substance Abuse.................           62.00          115.00          123.00
----------------------------------------------------------------------------------------------------------------
                                     G. Family Practice/Primary Medical Care                                    
----------------------------------------------------------------------------------------------------------------
BGA...........................  Family Practice.................           67.00          124.00          132.00
BHA...........................  Primary Care....................           64.00          118.00          126.00
BHB...........................  Medical Examination.............           59.00          109.00          117.00
BHC...........................  Optometry.......................           42.00           77.00           82.00
BHD...........................  Audiology.......................           30.00           55.00           58.00
BHE...........................  Speech Pathology................           81.00          149.00          159.00
BHF...........................  Community Health................           41.00           75.00           80.00
BHG...........................  Occupational Health.............           59.00          108.00          115.00
BHH...........................  TRICARE Outpatient..............           42.00           78.00           83.00
BHI...........................  Immediate Care..................           82.00          152.00          162.00
BHZ...........................  Primary Care NEC................           43.00           79.00           84.00
----------------------------------------------------------------------------------------------------------------
                                            H. Emergency Medical Care                                           
----------------------------------------------------------------------------------------------------------------
BIA...........................  Emergency Medical...............          107.00          198.00          211.00
----------------------------------------------------------------------------------------------------------------
                                             I. Flight Medical Care                                             
----------------------------------------------------------------------------------------------------------------
BJA...........................  Flight Medicine.................           85.00          157.00          167.00
----------------------------------------------------------------------------------------------------------------
                                            J. Underseas Medical Care                                           
----------------------------------------------------------------------------------------------------------------
BKA...........................  Underseas Medicine..............           32.00           58.00           62.00
----------------------------------------------------------------------------------------------------------------
                                           K. Rehabilitative Services                                           
----------------------------------------------------------------------------------------------------------------
BLA...........................  Physical Therapy................           29.00           54.00           57.00
BLB...........................  Occupational Therapy............           53.00           98.00          104.00
----------------------------------------------------------------------------------------------------------------


[[Page 54135]]

III. Other Rates and Charges \1\ \2\ Per Visit

----------------------------------------------------------------------------------------------------------------
                                                                   International    Interagency                 
                                                                     Military        and other                  
        MEPRS code \4\                  Clinical service            Education &   Federal agency   Other  (Full/
                                                                     Training        sponsored     Third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
FBI...........................  A. Immunization.................          $10.00          $19.00          $20.00
DGC...........................  B. Hyperbaric Chamber \5\.......          180.00          333.00          355.00
                                C. Ambulatory Procedure Visit             376.00          691.00          737.00
                                 (APV) \6\.                                                                     
                                D. Family Member Rate (formerly            10.20  ..............  ..............
                                 Military Dependents Rate).                                                     
----------------------------------------------------------------------------------------------------------------

E. Reimbursement Rates For Drugs Requested By Outside Providers \7\
    The FY98 drug reimbursement rates for drugs are for prescriptions 
requested by outside providers and obtained at a Military Treatment 
Facility. The rates are established based on the cost of the particular 
drugs provided. Final rule of 32 CFR part 220, estimated to be 
published October 1, 1997, will eliminate the high cost ancillary 
services' dollar threshold and the associated term ``high cost 
ancillary service.'' In anticipation of that change, the phrase ``high 
cost ancillary service'' has been replaced with the phrase ``ancillary 
services requested by an outside provider.'' The list of drug 
reimbursement rates is too large to include here. These rates are 
available on request from OASD (Health Affairs)--see Tab N for the 
point of contact.
F. Reimbursement Rates for Ancillary Services Requested By Outside 
Providers \8\
    Final rule of 32 CFR part 220, estimated to be published October 1, 
1997, will eliminate the high cost ancillary services' dollar threshold 
and the associated term ``high cost ancillary service.'' In 
anticipation of that change, the phrase ``high cost ancillary service'' 
has been replaced with the phrase ``ancillary services requested by an 
outside provider.'' The list of FY98 rates for ancillary services 
requested by outside providers and obtained at a Military Treatment 
Facility is too large to include here. These rates are available on 
request from OASD(Health Affairs)--see Tab N for the point of contact.
G. Elective Cosmetic Surgery Procedures and Rates

----------------------------------------------------------------------------------------------------------------
                                    International    Current Procedural                                         
   Cosmetic surgery procedure      Classification     Terminology (CPT)     FY98 charge \10\        Amount of   
                                  Diseases (ICD-9)           \9\                                      charge    
----------------------------------------------------------------------------------------------------------------
Mammaplasty....................  85.50, 85.32,       19325, 19324,       Inpatient Surgical      (a b c)        
                                  85.31.              19318.              Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Mastopexy......................  85.60.............  19316.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Facial Rhytidectomy............  86.82, 86.22......  15824.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Blepharoplasty.................  08.70, 08.44......  15820, 15821,       Inpatient Surgical      (a b c)        
                                                      15822, 15823.       Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Mentoplasty (Augmentation        76.68, 76.67......  21208, 21209......  Inpatient Surgical      (a b c)        
 Reduction).                                                              Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Abdominoplasty.................  86.83.............  15831.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Lipectomy suction per region     86.83.............  15876, 15877,       Inpatient Surgical      (a b c)        
 \11\.                                                15878, 15879.       Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Rhinoplasty....................  21.87, 21.86......  30400, 30410......  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Scar Revisions beyond CHAMPUS..  86.84.............  1578__............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Mandibular or Maxillary          76.41.............  21194.............  Inpatient Surgical      (a b c)        
 Repositioning.                                                           Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Minor Skin Lesions \12\........  86.30.............  1578__............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Dermabrasion...................  86.25.............  15780.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Hair Restoration...............  86.64.............  15775.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Removing Tattoos...............  86.25.............  15780.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Chemical Peel..................  86.24.............  15790.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Arm/Thigh Dermolipectomy.......  86.83.............  1583__............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
Brow Lift......................  86.3..............  15839.............  Inpatient Surgical      (a b c)        
                                                                          Care Per Diem or APV                  
                                                                          or applicable                         
                                                                          Outpatient Clinic                     
                                                                          Rate.                                 
----------------------------------------------------------------------------------------------------------------


[[Page 54136]]

H. Dental Rate \13\ Per Procedure

----------------------------------------------------------------------------------------------------------------
                                                                   International    Interagency                 
                                                                     military        and other                  
        MEPRS code \4\                  Clinical service           education and  federal agency   Other  (Full/
                                                                     training        sponsored     third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
                                oDental Services................          $35.00         $101.00         $106.00
                                ADA code and DoD established                                                    
                                 weight.                                                                        
----------------------------------------------------------------------------------------------------------------

I. Ambulance Rate \14\ Per Visit

----------------------------------------------------------------------------------------------------------------
                                                                   International  nteragency and                
                                                                     military      other federal                
        MEPRS code \4\                  Clinical service           education and      agency       Other  (Full/
                                                                     training        sponsored     Third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
FEA...........................  Ambulance.......................          $32.00          $60.00          $64.00
----------------------------------------------------------------------------------------------------------------

J. Laboratory and Radiology Services Requested by an Outside Provider 
\8\ Per Procedure

----------------------------------------------------------------------------------------------------------------
                                                                   International   nteragency &                 
                                                                     military      other federal                
        MEPRS code \4\                  Clinical service            education &       agency       Other (full/ 
                                                                     training        sponsored     third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
                                Laboratory procedures requested            $9.00          $13.00          $14.00
                                 by an outside provider CPT-4                                                   
                                 Weight Multiplier.                                                             
                                Radiology procedures requested             23.00           35.00           37.00
                                 by an outside provider CPT-4                                                   
                                 Weight Multiplier.                                                             
----------------------------------------------------------------------------------------------------------------

K. AirEvac Rate \15\ Per Visit

----------------------------------------------------------------------------------------------------------------
                                                                   International    Interagency                 
                                                                     military        and other                  
        MEPRS code \4\                  Clinical service           education and  federal agency   Other  (Full/
                                                                     training        sponsored     third party) 
                                                                      (IMET)         patients                   
----------------------------------------------------------------------------------------------------------------
                                AirEvac Services--Ambulatory....         $113.00         $209.00         $223.00
                                AirEvac Services--Litter........          323.00          598.00          638.00
----------------------------------------------------------------------------------------------------------------

Notes on Cosmetic Surgery Charges

    a Per diem charges for inpatient surgical care 
services are listed in section I.B. (See notes 9 through 11, below, 
for further details on reimbursable rates.)
    b Charges for ambulatory procedure visits (formerly 
same day surgery) are listed in section III.C. (See notes 9 through 
11, below, for further details on reimbursable rates.) The APV rate 
is used if the elective cosmetic surgery is performed in an 
ambulatory procedure unit (APU).
    c Charges for outpatient clinic visits are listed in 
section II.A-K. The outpatient clinic rate is not used for services 
provided in an APU. The APV rate should be used in these cases.

Notes on Reimbursable Rates

    1 Percentages can be applied when preparing bills for 
both inpatient and outpatient services. Pursuant to the provisions 
of 10 U.S.C. 1095, the inpatient Diagnosis Related Groups and 
inpatient per diem percentages are 96 percent hospital and 4 percent 
professional charges. The outpatient per visit percentages are 88 
percent outpatient services and 12 percent professional charges.
    2 DoD civilian employees located in overseas areas 
shall be rendered a bill when services are performed. Payment is due 
60 days from the date of the bill.
    3 The cost per DRG (Diagnosis Related Group) is based 
on the inpatient full reimbursement rate per hospital discharge, 
weighted to reflect the intensity of the principal and secondary 
diagnoses, surgical procedures, and patient demographics involved. 
The adjusted standardized amounts (ASA) per Relative Weighted 
Product (RWP) for use in the direct care system is comparable to 
procedures used by the Health Care Financing Administration (HCFA) 
and the Civilian Health and Medical Program for the Uniformed 
Services (CHAMPUS). These expenses include all direct care expenses 
associated with direct patient care. The average cost per RWP for 
large urban, other urban/rural, and overseas will be published 
annually as an adjusted standardized amount (ASA) and will include 
the cost of inpatient professional services. The DRG rates will 
apply to reimbursement from all sources, not just third party 
payers.
    4 The Medical Expense and Performance Reporting 
System (MEPRS) code is a three digit code which defines the summary 
account and the subaccount within a functional category in the DoD 
medical system. MEPRS codes are used to ensure that consistent 
expense and operating performance data is reported in the DoD 
military medical system. An example of the MEPRS hierarchical 
arrangement follows: Outpatient Care (Functional Category), B (MEPRS 
Code), Medical Care (Summary Account), BA (MEPRS Code), Internal 
Medicine (Subaccount), BAA (MEPRS Code).
    5 Hyperbaric services charges shall be based on hours 
of service in 15 minute increments. The rates listed in section 
III.B. are for 60 minutes or 1 hour of service. Providers shall 
calculate the charges based on the number of hours (and/or fractions 
of an hour) of service. Fractions of an hour shall be rounded to the 
next 15 minute increment (e.g., 31 minutes shall be charged as 45 
minutes).
    6 Ambulatory Procedure Visit (APV) is defined in DOD 
Instruction 6025.8, September 23, 1996, as immediate (day of 
procedure) pre-procedure and immediate post-procedure care requiring 
an unusual degree of intensity and provided in an ambulatory 
procedure

[[Page 54137]]

unit (APU). Care is required in the facility for less than 24 hours. 
This rate is also used for elective cosmetic surgery performed in an 
APU.
    7 Prescription services requested by outside 
providers (physicians, dentists, etc.) are relevant to the Third 
Party Collection Program. Third party payers (such as insurance 
companies) shall be billed for prescription services when 
beneficiaries who have medical insurance obtain medications from a 
Military Treatment Facility (MTF) that are prescribed by providers 
external to the MTF. Eligible beneficiaries (family members or 
retirees with medical insurance) are not personally liable for this 
cost and shall not be billed by the MTF. Medical Services Account 
(MSA) patients, who are not beneficiaries as defined in 10 U.S.C. 
1074 and 1076, are charged at the ``Other'' rate if they are seen by 
an outside provider and come to the MTF for prescription services. 
The standard cost of medications ordered by an outside provider 
includes the cost of the drugs plus a dispensing fee per 
prescription. The prescription cost is calculated by multiplying the 
number of units (tablets, capsules, etc.) by the unit cost and 
adding a $5.00 dispensing fee per prescription. Final rule of 32 CFR 
part 220, estimated to be published October 1, 1997, will eliminate 
the high cost ancillary services' dollar threshold (by changing it 
from $25 to $0) and the associated term ``high cost ancillary 
service.'' In anticipation of that change, the phrase ``high cost 
ancillary service'' has been replaced with the phrase ``ancillary 
services requested by an outside provider.'' The elimination of the 
threshold ipso facto eliminates the bundling of costs whereby a 
patient was billed if the total ancillary services costs in a day 
(defined as 0001 hours to 2400 hours) exceeded $25.00.
    8 Charges for ancillary services requested by an 
outside provider (physicians, dentists, etc.) are relevant to the 
Third Party Collection Program. Third party payers (such as 
insurance companies) shall be billed for ancillary services when 
beneficiaries who have medical insurance obtain services from the 
MTF that are prescribed by providers external to the MTF. Laboratory 
and Radiology procedure costs are calculated using the Physicians' 
Current Procedural Terminology (CPT)-4 Report weight multiplied by 
either the laboratory or radiology multiplier (section III.J). 
Eligible beneficiaries (family members or retirees with medical 
insurance) are not personally liable for this cost and shall not be 
billed by the MTF. MSA patients, who are not beneficiaries as 
defined by 10 U.S.C. 1074 and 1076, are charged at the ``Other'' 
rate if they are seen by an outside provider and come to the MTF for 
services. Final rule of 32 CFR Part 220, estimated to be published 
October 1, 1997, will eliminate the high cost ancillary services' 
dollar threshold (by changing it from $25 to $0) and the associated 
term ``high cost ancillary service.'' In anticipation of that 
change, the phrase ``high cost ancillary service'' has been replaced 
with the phrase ``ancillary services requested by an outside 
provider.'' The elimination of the threshold ipso facto eliminates 
the bundling of costs whereby a patient was billed if the total 
ancillary services costs in a day (defined as 0001 hours to 2400 
hours) exceeded $25.00.
    9 The attending physician is to complete the CPT-4 
code to indicate the appropriate procedure followed during cosmetic 
surgery. The appropriate rate will be applied depending on the 
treatment modality of the patient: Ambulatory procedure visit, 
outpatient clinic visit or inpatient surgical care services.
    10 Family members of active duty personnel, retirees 
and their family members, and survivors shall be charged elective 
cosmetic surgery rates. Elective cosmetic surgery procedure 
information is contained in Section III G. The patient shall be 
charged the rate as specified in the FY98 reimbursable rates for an 
episode of care. The charges for elective cosmetic surgery are at 
the full reimbursement rate (designated as the ``Other'' rate) for 
inpatient per diem surgical care services in section I.B., 
ambulatory procedure visits as contained in section III.C, or the 
appropriate outpatient clinic rate in section II A-K. The patient is 
responsible for the cost of the implant(s) and the prescribed 
cosmetic surgery rate. NOTE: The implants and procedures used for 
the augmentation mammaplasty are in compliance with Federal Drug 
Administration guidelines.
    11 Each regional lipectomy shall carry a separate 
charge. Regions include head and neck, abdomen, flanks, and hips.
    12 These procedures are inclusive in the minor skin 
lesions. However, CHAMPUS separates them as noted here. All charges 
shall be for the entire treatment, regardless of the number of 
visits required.
    13 Dental service rates are based on a dental rate 
multiplier times the American Dental Association (ADA) code and the 
DoD established weight for that code.
    14 Ambulance charges shall be based on hours of 
service in 15 minute increments. The rates listed in section III.I 
are for 60 minutes or 1 hour of service. Providers shall calculate 
the charges based on the number of hours (and/or fractions of an 
hour) that the ambulance is logged out on a patient run. Fractions 
of an hour shall be rounded to the next 15 minute increment (e.g., 
31 minutes shall be charged as 45 minutes).
    15 Air in-flight medical care reimbursement charges 
are determined by the status of the patient (ambulatory or litter) 
and are per patient. The charges are billed only by the Air Force 
Global Patient Movement Requirement Center (GFMRC).

2. Department of Health and Human Services

    For the Department of Health and Human Services, Indian Health 
Service, effective October 1, 1997 and thereafter:

                       Hospital Care Inpatient Day                      
                                                                        
General Medical Care...............  Alaska....................   $1,702
                                     Rest of the United States.    1,049
                                                                        
                      Outpatient Medical Treatment                      
                                                                        
Outpatient Visit...................  Alaska....................      340
                                     Rest of the United States.      209
                                                                        

3. Department of Veterans Affairs

    For the Department of Veterans Affairs, effective October 1, 1997 
and thereafter:

------------------------------------------------------------------------
                                            Tortiously      Interagency 
                                           liable rates        rates    
------------------------------------------------------------------------
                 Hospital Care, Rates Per Inpatient Day                 
------------------------------------------------------------------------
General Medicine:                                                       
    Total...............................           $1208           $1098
        Physician.......................             145  ..............
        Ancillary.......................             315  ..............
        Nursing, Room, and Board........             748  ..............
Neurology:                                                              
    Total...............................            1154            1042
        Physician.......................             169  ..............
        Ancillary.......................             305  ..............

[[Page 54138]]

                                                                        
        Nursing, Room, and Board........             680  ..............
Rehabilitation Medicine:                                                
  Total.................................             808             729
        Physician.......................              92  ..............
        Ancillary.......................             247  ..............
        Nursing, Room, and Board........             469  ..............
Blind Rehabilitation:                                                   
  Total.................................             957             873
        Physician.......................              77  ..............
        Ancillary.......................             475  ..............
        Nursing, Room, and Board........             405  ..............
Spinal Cord Injury:                                                     
  Total.................................             886             801
        Physician.......................             110  ..............
        Ancillary.......................             223  ..............
        Nursing, Room, and Board........             553  ..............
Surgery:                                                                
    Total...............................            2079            1904
        Physician.......................             229  ..............
        Ancillary.......................             631  ..............
        Nursing, Room, and Board........            1219  ..............
General Psychiatry:                                                     
    Total...............................             557             518
        Physician.......................              54  ..............
        Ancillary.......................              91  ..............
        Nursing, Room, and Board........             432  ..............
Substance Abuse (Alcohol and Drug                                       
 Treatment):                                                            
    Total...............................             333             300
        Physician.......................              32  ..............
        Ancillary.......................              77  ..............
        Nursing, Room, and Board........             224  ..............
Intermediate Medicine:                                                  
    Total...............................             396             356
        Physician.......................              19  ..............
        Ancillary.......................              58  ..............
        Nursing, Room, and Board........             319  ..............
------------------------------------------------------------------------
                     Nursing Home Care, Rates Per Day                   
------------------------------------------------------------------------
Nursing Home Care:                                                      
    Total...............................             299             270
        Physician.......................               9  ..............
        Ancillary.......................              40  ..............
        Nursing Room, and Board.........             250  ..............
------------------------------------------------------------------------
                 Outpatient Medical and Dental Treatment                
------------------------------------------------------------------------
Outpatient Visit:                                                       
    Total...............................             229             211
Emergency Dental........................             143             127
Outpatient Visit Prescription Filled....              25              25
------------------------------------------------------------------------

    For the period beginning October 1, 1997, the rates prescribed 
herein superseded those established by the Director of the Office of 
Management and Budget, October 31, 1996 (61 FR 56360).
Franklin D. Raines,
Director, Office of Management and Budget.
[FR Doc. 97-27629 Filed 10-16-97; 8:45 am]
BILLING CODE 3110-01-P