[Federal Register Volume 72, Number 188 (Friday, September 28, 2007)]
[Rules and Regulations]
[Pages 55085-55089]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-18732]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-1545-CN]

42 CFR Part 409

RIN 0938-AM46


Medicare Program; Prospective Payment System and Consolidated 
Billing for Skilled Nursing Facilities; Corrections

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

ACTION: Final rule; correction notice.

-----------------------------------------------------------------------

SUMMARY: This document corrects technical errors that appeared in the 
August 3, 2007 Federal Register, entitled ``Medicare Program; 
Prospective Payment System and Consolidated Billing for Skilled Nursing 
Facilities for FY 2008; Final Rule.''

DATES: Effective Date: This correction is effective October 1, 2007.

FOR FURTHER INFORMATION CONTACT: Bill Ullman, (410) 786-5667.

SUPPLEMENTARY INFORMATION:

I. Background

    FR Doc. 07-3784 of August 3, 2007 (72 FR 43412) contained technical 
errors that this notice serves to identify and correct. The first 
involves the construction of the 2004 skilled nursing facility (SNF) 
market basket update. In the SNF prospective payment system (PPS) 
proposed rule for fiscal year (FY) 2008 (72 FR 25552, May 4, 2007), we 
proposed to discontinue the previous, 1997-based market basket's use of 
the Producer Price Index (PPI) for Industrial Chemicals, in favor of 
using a blended PPI composed of the PPIs for soap and other detergent 
manufacturing (North American Industrial Classification System (NAICS) 
325611), polish and other sanitation good manufacturing (NAICS 325612), 
and all other miscellaneous chemical product and preparation 
manufacturing (NAICS 325998) in the 2004-based market basket, which we 
believed would better reflect SNF purchasing patterns. In the FY 2008 
SNF PPS final rule, we finalized this proposal ``* * * to revise the 
market basket to reflect more appropriate, industry-specific price 
proxies (such as the blended compensation and chemical price proxies)'' 
(72 FR 43426, 43436).
    However, in performing the actual calculations in the final rule, 
we inadvertently proxied the chemicals cost weight by the PPI for 
Industrial Chemicals rather than by the appropriate blended chemical 
price proxy. We note that this error did not affect the final market 
basket update factor of 3.3 percent, but did affect the labor-related 
share. The corrected labor-related share is 70.249, which is slightly 
higher than the 70.152 figure published in the FY 2008 SNF PPS final 
rule. Accordingly, in this notice, we are republishing corrected 
versions of Tables 6, 7, 10, 13, and 14 (as well as revising the 
corresponding portions of the final rule's preamble text) in order to 
reflect the final, corrected labor-related share.
    In addition, we have determined that in the process of developing 
the most recent hospital wage index, two inpatient hospital providers 
with wage data that belonged in the Hartford-West Hartford-East 
Hartford, CT core-based statistical area (CBSA) were inadvertently 
included in rural Connecticut instead. Accordingly, in Table 8, we are 
revising the wage index value for CBSA Code 25540 (Hartford-West 
Hartford-East Hartford, CT) from 1.0937 to the corrected value of 
1.0930. Similarly, in Table 9, we are revising the wage index value for 
CBSA Code 7 (rural Connecticut) from 1.1283 to the corrected value of 
1.1711. As we are revising only a single entry in each of these two 
tables, we are not republishing Tables 8 and 9 in their entirety in 
this notice; however, we note that the corrected versions of both 
tables are available online on the SNF PPS Web site, at http://www.cms.hhs.gov/SNFPPS/04_WageIndex.asp. Moreover, we note that the 
corrected version of Table 14 that we are republishing in this notice 
also reflects these corrected values. We are also correcting a 
typographical error in the final rule's version of that table, which 
had inadvertently displayed the wage data update for rural New England 
incorrectly as a negative value.

II. Correction of Errors

    In FR Doc. 07-3784 (72 FR 43412), make the following corrections:
    1. On page 43421, Table 6 is corrected to read as follows:

[[Page 55086]]



                            Table 6.--RUG-53
 [Case-Mix Adjusted Federal Rates for Urban SNFs by Labor and Non-Labor
                               Component.]
------------------------------------------------------------------------
                                                   Labor      Non-labor
         RUG-III category           Total rate    portion      portion
------------------------------------------------------------------------
RUX..............................       601.90       422.83       179.07
RUL..............................       528.59       371.33       157.26
RVX..............................       456.34       320.57       135.77
RVL..............................       425.55       298.94       126.61
RHX..............................       386.84       271.75       115.09
RHL..............................       379.51       266.60       112.91
RMX..............................       442.85       311.10       131.75
RML..............................       406.19       285.34       120.85
RLX..............................       314.39       220.86        93.53
RUC..............................       510.99       358.97       152.02
RUB..............................       468.47       329.10       139.37
RUA..............................       446.48       313.65       132.83
RVC..............................       410.89       288.65       122.24
RVB..............................       390.37       274.23       116.14
RVA..............................       350.78       246.42       104.36
RHC..............................       357.52       251.15       106.37
RHB..............................       341.39       239.82       101.57
RHA..............................       316.46       222.31        94.15
RMC..............................       328.48       230.75        97.73
RMB..............................       319.69       224.58        95.11
RMA..............................       312.35       219.42        92.93
RLB..............................       289.47       203.35        86.12
RLA..............................       246.95       173.48        73.47
SE3..............................       362.08       254.36       107.72
SE2..............................       307.83       216.25        91.58
SE1..............................       274.11       192.56        81.55
SSC..............................       269.71       189.47        80.24
SSB..............................       255.05       179.17        75.88
SSA..............................       250.65       176.08        74.57
CC2..............................       268.25       188.44        79.81
CC1..............................       244.79       171.96        72.83
CB2..............................       233.06       163.72        69.34
CB1..............................       222.79       156.51        66.28
CA2..............................       221.33       155.48        65.85
CA1..............................       206.67       145.18        61.49
IB2..............................       197.87       139.00        58.87
IB1..............................       194.94       136.94        58.00
IA2..............................       178.81       125.61        53.20
IA1..............................       171.48       120.46        51.02
BB2..............................       196.40       137.97        58.43
BB1..............................       190.54       133.85        56.69
BA2..............................       177.34       124.58        52.76
BA1..............................       165.61       116.34        49.27
PE2..............................       214.00       150.33        63.67
PE1..............................       209.60       147.24        62.36
PD2..............................       203.73       143.12        60.61
PD1..............................       200.80       141.06        59.74
PC2..............................       193.47       135.91        57.56
PC1..............................       190.54       133.85        56.69
PB2..............................       170.01       119.43        50.58
PB1..............................       168.54       118.40        50.14
PA2..............................       167.08       117.37        49.71
PA1..............................       162.68       114.28        48.40
------------------------------------------------------------------------

    2. On page 43422, Table 7 is corrected to read as follows:

                            Table 7.--RUG-53
 [Case-Mix Adjusted Federal Rates for Rural SNFs by Labor and Non-Labor
                               Component.]
------------------------------------------------------------------------
                                                   Labor      Non-labor
         RUG-III category           Total rate    portion      portion
------------------------------------------------------------------------
RUX..............................       628.90       441.80       187.10
RUL..............................       558.86       392.59       166.27
RVX..............................       471.49       331.22       140.27
RVL..............................       442.08       310.56       131.52

[[Page 55087]]

 
RHX..............................       394.83       277.36       117.47
RHL..............................       387.83       272.45       115.38
RMX..............................       444.62       312.34       132.28
RML..............................       409.60       287.74       121.86
RLX..............................       314.47       220.91        93.56
RUC..............................       542.05       380.78       161.27
RUB..............................       501.43       352.25       149.18
RUA..............................       480.42       337.49       142.93
RVC..............................       428.07       300.71       127.36
RVB..............................       408.46       286.94       121.52
RVA..............................       370.64       260.37       110.27
RHC..............................       366.82       257.69       109.13
RHB..............................       351.41       246.86       104.55
RHA..............................       327.60       230.14        97.46
RMC..............................       335.36       235.59        99.77
RMB..............................       326.96       229.69        97.27
RMA..............................       319.95       224.76        95.19
RLB..............................       290.66       204.19        86.47
RLA..............................       250.04       175.65        74.39
SE3..............................       352.30       247.49       104.81
SE2..............................       300.47       211.08        89.39
SE1..............................       268.25       188.44        79.81
SSC..............................       264.05       185.49        78.56
SSB..............................       250.04       175.65        74.39
SSA..............................       245.84       172.70        73.14
CC2..............................       262.65       184.51        78.14
CC1..............................       240.23       168.76        71.47
CB2..............................       229.03       160.89        68.14
CB1..............................       219.22       154.00        65.22
CA2..............................       217.82       153.02        64.80
CA1..............................       203.81       143.17        60.64
IB2..............................       195.41       137.27        58.14
IB1..............................       192.61       135.31        57.30
IA2..............................       177.20       124.48        52.72
IA1..............................       170.19       119.56        50.63
BB2..............................       194.01       136.29        57.72
BB1..............................       188.41       132.36        56.05
BA2..............................       175.80       123.50        52.30
BA1..............................       164.59       115.62        48.97
PE2..............................       210.82       148.10        62.72
PE1..............................       206.62       145.15        61.47
PD2..............................       201.01       141.21        59.80
PD1..............................       198.21       139.24        58.97
PC2..............................       191.21       134.32        56.89
PC1..............................       188.41       132.36        56.05
PB2..............................       168.79       118.57        50.22
PB1..............................       167.39       117.59        49.80
PA2..............................       165.99       116.61        49.38
PA1..............................       161.79       113.66        48.13
------------------------------------------------------------------------

    3. On page 43424, third column, first full paragraph, line 7, the 
figure ``$29,758'' is corrected to read ``$29,755''.
    4. On page 43424, Table 10 is corrected to read as follows:

                                                                    Table 10.--RUG-53
                                      [SNF XYZ: Located in Cedar Rapids, IA (Urban CBSA 16300) Wage Index: 0.8852]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Percent      Medicare
                    RUG group                        Labor      Wage index   Adj. labor   Non-labor    Adj. rate       adj.         days       Payment
--------------------------------------------------------------------------------------------------------------------------------------------------------
RVX.............................................      $320.57       0.8852      $283.77      $135.77      $419.54      $419.54           14    $5,874.00
RLX.............................................       220.86       0.8852       195.51        93.53       289.04       289.04           30     8,671.00
RHA.............................................       222.31       0.8852       196.79        94.15       290.94       290.94           16     4,655.00
CC2.............................................       188.44       0.8852       166.81        79.81       246.62      *562.29           10     5,623.00
IA2.............................................       125.61       0.8852       111.19        53.20       164.39       164.39           30     4,932.00
                                                 -------------------------------------------------------------------------------------------------------

[[Page 55088]]

 
    Total.......................................  ...........  ...........  ...........  ...........  ...........  ...........          100   29,755.00
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Reflects a 128 percent adjustment from section 511 of the MMA.

    5. On page 43430, Table 13 is corrected to read as follows:

    Table 13.--Labor-related Relative Importance, FY 2007 and FY 2008
------------------------------------------------------------------------
                                             Relative        Relative
                                            importance,     importance,
                                          labor-related,  labor-related,
                                          FY 2007 (1997-  FY 2008 (2004-
                                           based index)    based index)
                                           06:2 forecast   07:2 forecast
------------------------------------------------------------------------
Wages and salaries......................          54.231          51.218
Employee benefits.......................          11.903          11.72
Nonmedical professional fees............           2.721           1.333
Labor-intensive services................           4.035           3.456
Capital-related (.391)..................           2.949           2.522
                                         -------------------------------
    Total...............................          75.839          70.249
------------------------------------------------------------------------

    6. On page 43434, third column, final paragraph, line 19, the 
figure ``9.6 percent'' is corrected to read ``9.5 percent''.
    7. On page 43435, Table 14 is corrected to read as follows:

                             Table 14.--Projected Impact to the SNF PPS for FY 2008
----------------------------------------------------------------------------------------------------------------
                                                                                                   Total FY 2008
                                                                     Number of      Update wage       change
                                                                    facilities    data (percent)     (percent)
----------------------------------------------------------------------------------------------------------------
Total...........................................................          15,325             0.0             3.3
Urban...........................................................          10,476           -.0.2             3.1
Rural...........................................................           4,849             1.0             4.3
Hospital based urban............................................           1,450             0.0             3.3
Freestanding urban..............................................           9,026            -0.2             3.1
Hospital based rural............................................           1,130             1.2             4.5
Freestanding rural..............................................           3,719             1.0             4.3
Urban by region:
    New England.................................................             865            -0.3             3.0
    Middle Atlantic.............................................           1,482            -0.9             2.4
    South Atlantic..............................................           1,735             0.0             3.3
    East North Central..........................................           2,004            -0.2             3.1
    East South Central..........................................             524             0.0             3.3
    West North Central..........................................             823             0.4             3.7
    West South Central..........................................           1,146             0.2             3.5
    Mountain....................................................             470             0.1             3.4
    Pacific.....................................................           1,419            -0.2             3.1
    Outlying\1\.................................................               8             6.0             9.5
Rural by region:
    New England.................................................             130             0.5             3.8
    Middle Atlantic.............................................             260             1.5             4.8
    South Atlantic..............................................             608             0.9             4.2
    East North Central..........................................             927             0.9             4.2
    East South Central..........................................             556             1.1             4.4
    West North Central..........................................           1,134             0.9             4.2
    West South Central..........................................             818             1.3             4.6
    Mountain....................................................             262             1.3             4.6
    Pacific.....................................................             152             1.3             4.6
    Outlying\1\.................................................               2            -3.2             0.0
Ownership:
    Government..................................................             675             0.1             3.4
    Proprietary.................................................          11,178             0.0             3.3

[[Page 55089]]

 
    Voluntary...................................................           3,472            -0.1             3.2
----------------------------------------------------------------------------------------------------------------
\1\ The Outlying region includes the following, noncontiguous jurisdictions referenced as States in Sec.  Sec.
  1861(x) and 210(h) of the Social Security Act: Puerto Rico, the Virgin Islands, American Samoa, and Guam.

    8. On page 43436, third column, lines 4-5, the figure ``9.6 
percent'' is corrected to read ``9.5 percent''.
    9. On page 43446, the entry of ``1.0937'' that is displayed in 
Table 8 as the wage index value for CBSA Code 25540 (Hartford-West 
Hartford-East Hartford, CT) is corrected to read ``1.0930''.
    10. On page 43462, the entry of ``1.1283'' that is displayed in 
Table 9 as the wage index value for CBSA Code 7 (rural Connecticut) is 
corrected to read ``1.1711''.

III. 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 take effect 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 a notice and comment process is 
impracticable, unnecessary or contrary to the public interest, and 
incorporates a statement of the finding and the reasons therefore in 
the notice.
    We find for good cause that it is unnecessary to undertake notice 
and comment rulemaking because this notice merely provides technical 
corrections to the regulations. We are not making substantive changes 
to our payment methodologies or policies, but rather, are simply 
implementing correctly the payment methodologies and policies that we 
previously proposed, received comment on, and subsequently finalized. 
The public has already had the opportunity to comment on these payment 
methodologies and policies, and this correction notice is intended 
solely to ensure that the FY 2008 SNF PPS final rule accurately 
reflects them. Therefore, we believe that undertaking further notice 
and comment procedures to incorporate these corrections into the update 
notice is unnecessary and contrary to the public interest.
    Further, we believe a delayed effective date is unnecessary because 
this correction notice merely corrects inadvertent technical errors. 
The changes noted above do not make any substantive changes to the SNF 
PPS payment methodologies or policies. Moreover, we regard imposing a 
delay in the effective date as being contrary to the public interest. 
We believe that it is in the public interest for providers to receive 
appropriate SNF PPS payments in as timely a manner as possible and to 
ensure that the FY 2008 SNF PPS final rule accurately reflects our 
payment methodologies, payment rates, and policies. Therefore, we find 
good cause to waive notice and comment procedures, as well as the 30-
day delay in effective date.

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

    Dated: September 17, 2007.
Ann C. Agnew,
Executive Secretary to the Department.
[FR Doc. E7-18732 Filed 9-27-07; 8:45 am]
BILLING CODE 4120-01-P