[Federal Register Volume 69, Number 250 (Thursday, December 30, 2004)]
[Rules and Regulations]
[Pages 78315-78335]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-28253]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 419

[CMS-1427-CN]
RIN 0938-AM75


Medicare Program; Changes to the Hospital Outpatient Prospective 
Payment System and Calendar Year 2005 Payment Rates; Wage Index Tables 
and Corrections

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Correction of final rule with comment period.

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SUMMARY: This document corrects technical errors that appear in the 
final rule with comment period published in the Federal Register on 
November 15, 2004 entitled ``Changes to the Hospital Outpatient 
Prospective Payment System and Calendar Year 2005 Payment Rates.'' In 
addition, it provides additional information about the calendar year 
2005 wage indices for this payment system that was not published in 
that final rule with comment period.

DATES: Effective Date: This document is effective on January 1, 2005.

FOR FURTHER INFORMATION CONTACT: Dana Burley, (410) 786-0378.

SUPPLEMENTARY INFORMATION: 

I. Background

A. Corrections

    In FR Doc. 04-24759 of November 15, 2004 (69 FR 65681), there were 
a few inadvertent technical and typographical errors that we are 
correcting and identifying in the ``Correction of Errors'' section 
below. The provisions in this correction are effective as if they had 
been included in the document published in the Federal Register on 
November 15, 2004, that is, as of January 1, 2005.

B. Wage Index

    Section 1833(t)(2)(D) of the Social Security Act (the Act) requires 
the Secretary to determine a wage adjustment factor to adjust, for 
geographic wage differences, the portion of the Hospital Outpatient 
Prospective Payment System (OPPS) payment rate and the copayment 
standardized amount attributable to labor and labor-related cost. This 
adjustment must be made in a budget neutral manner. As we have done in 
prior years, we adopted the Hospital Inpatient Prospective Payment 
System (IPPS) wage indices and applied them to Tax Equality and Fiscal 
Responsibility Act (TEFRA) hospitals that participate in the OPPS but 
not the IPPS.
    In determining the OPPS payment rate and the copayment standardized 
amount, we standardize 60 percent of estimated costs (the labor-related 
portion of costs) for geographic area wage variation using the IPPS 
wage indices that are calculated prior to adjustments for 
reclassification to remove the effects of differences in area wage 
levels.
    As published in the original OPPS April 7, 2000 final rule (65 FR 
18545), the OPPS has consistently adopted the final IPPS wage indices 
for adjusting the OPPS standard payment amounts for labor market 
differences. In accordance with section 1886(d)(3)(E) of the Act, the 
IPPS wage index is updated annually. In the August 16, 2004 OPPS 
proposed rule (69 FR 50541), we proposed to use the corrected proposed 
fiscal year (FY) 2005 hospital IPPS wage index for urban areas 
published in the Federal Register on June 25, 2004 (69 FR 35919) and 
the proposed FY 2005 hospital IPPS wage index for rural areas published 
in the Federal Register on May 18, 2004 (69 FR 28580) to determine the 
wage adjustments for the OPPS payment rates and the copayment 
standardized amount for calendar year (CY) 2005.
    On November 15, 2004, we published the final rule with comment 
period for the OPPS and CY 2005 payment rates (69 FR 65681). In that 
final rule (69 FR

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65842), we specified that, while we customarily publish the wage index 
tables in the final rule for the OPPS update, we were not including 
them as we were in the process of reviewing the wage indices for IPPS. 
We added that we would publish the finalized tables in a later Federal 
Register document.

II. Correction of Errors

    In FR Doc. 04-24759 (69 FR 65681) make the following corrections:
    1. On page 65697, line 38 of the center column, the code ``73428'' 
is corrected to read ``74328.''
    2. On page 65771, line 39 of the first column ``January 1, 2006'' 
is corrected to read, ``January 1, 2007.''
    3. On page 65778, Table 23 incorrectly lists C9218. Table 23 is 
corrected to exclude C9218.
    4. On page 65841, line 22 of the third column, the payment rate for 
APC 375 is incorrectly identified as ``$3,214.22.'' The payment rate is 
corrected to read ``$3,217.47.''
    5. On page 65848, line 13 of the center column, the coinsurance 
amount for the partial hospitalization APC is incorrectly identified as 
``$56.33.'' The coinsurance amount is corrected to read ``$56.27.''
    6. On page 65885, APC 9218 incorrectly notes status indicator 
``G.'' The status indicator for APC 9218 is corrected to read ``K.''
    7. On page 66104, C9218 incorrectly notes status indicator ``G.'' 
The status indicator for C9218 is corrected to read ``K.''

III. Wage Index Tables and Additional Information

    As stated above, we adopted the final IPPS wage indices for 
adjusting the OPPS standard payment amounts for labor market 
differences. Accordingly, the final wage index tables for the IPPS and 
OPPS are included in the IPPS correction notice (CMS-1428-F2) published 
elsewhere in this issue. The applicable wage index tables published in 
the IPPS correction notice that we will adopt for OPPS calculations are 
referenced in the following chart:
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    In addition, as also noted above, we adopted the IPPS wage indices 
and applied them to TEFRA hospitals that participate in the OPPS but 
not the IPPS. For CY 2005, we will also implement an adjustment to the 
wage index to reflect the ''out-migration'' of hospital employees who 
reside in one county but commute to work in a different county with a 
higher wage index, in accordance with section 505 of the Medicare 
Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. 
108-173 (August 11, 2004 IPPS final rule (69 FR 49061 through 49067), 
as revised and corrected on October 7, 2004 (69 FR 60242)). Hospitals 
paid under the IPPS located in the qualifying section 505 ``out-
migration'' counties received a wage index increase. We are applying 
the same criterion to TEFRA hospitals paid under the OPPS but not paid 
under the IPPS. Therefore, TEFRA hospitals located in qualifying 
section 505 counties will also receive increases to their wage indices 
under OPPS. In the OPPS proposed rule (69 FR 50916), those TEFRA 
hospitals were included in Addendum K. Accordingly, in this notice, we 
are providing the finalized Addendum K below. This addendum includes 
the wage index adjustment for commuting hospital employees (out-
migration) in qualifying counties under IPPS (Table 4J under IPPS) as 
well as information regarding TEFRA hospitals that are paid under the 
OPPS and that are located in qualifying section 505 counties and for 
which an adjustment will be made to their wage indices for CY 2005. 
Column 4 identifies the TEFRA hospitals by triple asterisks (* * *).

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IV. Waiver of Proposed Rulemaking and Delayed Effective Date

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register to provide a period for public comment before the 
provisions of a notice such as this are effective in accordance with 
section 553(b) of the Administrative Procedure Act (APA) (5 U.S.C. 
553(b)). We also ordinarily provide a 30-day delay in the effective 
date of the provisions of a notice in accordance with section 553(d) of 
the APA (5 U.S.C. 553(d)). However, we can waive both the notice-and-
comment procedure and the 30-day delay in effective date if the 
Secretary finds, for good cause, that it is impracticable, unnecessary, 
or contrary to the public interest, and incorporates a statement of the 
finding and the reasons in the notice.
    We find it unnecessary to undertake notice-and-comment rulemaking 
because this correction notice merely provides minor technical and 
typographical corrections and does not make any substantive changes to 
the regulations. In addition, while we are presenting information 
regarding the wage index tables, we are not changing our payment 
methodology. We are adopting the IPPS wage indices and applying the 
methodology that has already been subject to public comment and 
subsequently finalized. As we stated in the OPPS final rule, we are now 
presenting the information regarding the wage index tables that was not 
available when the final rule was published. Thus, because the 
corrections are technical and typographical in nature, and the public 
has already been given the opportunity to comment on our method for 
calculating the wage adjustment factor and was informed earlier that 
the finalized wage index tables would be provided in a subsequent 
Federal Register document, we believe additional comment would be 
unnecessary.
    Further, we believe a delayed effective date is unnecessary because 
this notice merely corrects inadvertent technical errors and provides 
the tables that display the wage index values applicable for the OPPS 
as explained in the OPPS final rule (69 FR 65842). There is no 
significant effect on the payment rates for any provider. Further, we 
believe imposing a 30-day delay in the effective date would be contrary 
to the public interest for outpatient providers. To the extent that any 
provider's rates are affected, we believe that it is imperative that 
appropriate wage index values are applied in as timely a manner as 
possible, and that any delay in applying the appropriate wage index 
values would be contrary to the public interest. Therefore, we find 
good cause to waive notice-and-comment procedures, as well as the 30-
day delay in effective date.

    Authority: Section 1833(t) of the Social Security Act (42 U.S.C. 
1395l(t)).

(Catalog of Federal Domestic Assistance Program No. 93.773 
Medicare--Hospital Insurance Program; and No. 93.774, Medicare--
Supplementary Medical Insurance Program)

    Dated: December 21, 2004.
Ann C. Agnew,
Executive Secretary to the Department.
[FR Doc. 04-28253 Filed 12-22-04; 1:00 pm]
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