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Medicare Program; Hospice Wage Index for Fiscal Year 2006

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


Final rule.


This final rule sets forth the hospice wage index for fiscal year 2006 and identifies the revised labor market and metropolitan core based statistical areas. In addition, this final rule responds to public comments and implements provisions of sections 408 and 946 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.


These regulations are effective on October 1, 2005.

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Terri Deutsch, (410) 786-9462.

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I. Background

A. General

1. Hospice Care

Hospice care is an approach to treatment that recognizes that the impending death of an individual warrants a change in the focus from curative care to palliative care for relief of pain and for symptom management. The goal of hospice care is to help terminally ill individuals continue life with minimal disruption to normal activities while remaining primarily in the home environment. A hospice uses an interdisciplinary approach to deliver medical, social, psychological, emotional, and spiritual services through use of a broad spectrum of professional and other caregivers, with the goal of making the individual as physically and emotionally comfortable as possible. Counseling services and inpatient respite services are available to the family of the hospice patient. Hospice programs consider both the patient and the family as a unit of care.

Section 1861(dd) of the Social Security Act (the Act) provides for coverage of hospice care for terminally ill Medicare beneficiaries who elect to receive care from a participating hospice. Section 1814(i) of the Act provides payment for Medicare participating hospices.

2. Medicare Payment for Hospice Care

Our regulations at 42 CFR part 418 establish eligibility requirements, payment standards and procedures, define covered services, and delineate the conditions a hospice must meet to be approved for participation in the Medicare program. Part 418 subpart G provides for payment in one of four prospectively-determined rate categories (routine home care, continuous home care, inpatient respite care, and general inpatient care) to hospices based on each day a qualified Medicare beneficiary is under a hospice election.

B. Hospice Wage Index

The hospice wage index is used to adjust payment rates for hospice agencies under the Medicare program to reflect local differences in area wage levels. The original hospice wage index was based on the 1981 Bureau of Labor Statistics hospital data and had not been updated since 1983. In 1994, because of disparity in wages from one geographical location to another, a committee was formulated to negotiate a wage index methodology that could be accepted by the industry and the government. This committee, functioning under a process established by the Negotiated Rulemaking Act of 1990, was comprised of national hospice associations; rural, urban, large, and small hospices; multisite hospices; consumer groups; and a government representative. On April 13, 1995, the Hospice Wage Index Negotiated Rulemaking Committee signed an agreement for the methodology to be used for updating the hospice wage index.

In the August 8, 1997 Federal Register (62 FR 42860), we published a final rule implementing a new methodology for calculating the hospice wage index based on the recommendations of the negotiated rulemaking committee. The committee statement was included in the appendix of that final rule (62 FR 42883).

The annual update to the hospice wage index is published in the Federal Register and is based on the most current available hospital wage data, as well as any changes by the Office of Management and Budget (OMB) to the definitions of Metropolitan Statistical Areas (MSAs). Raw wage index values (inpatient hospital pre-floor and pre-reclassified wage index values) as described in the August 8, 1997 hospice wage index final rule are subject to either a budget neutrality adjustment or application of the wage index floor. Raw wage index values of 0.8 or greater are adjusted by the budget neutrality adjustment factor. Budget neutrality means that, in a given year, estimated aggregate payments for Medicare hospice services using the updated wage index values will equal estimated payments that would have been made for these services if the 1983 wage index values had remained in effect. To achieve this budget neutrality, the raw wage index is multiplied by a budget neutrality adjustment factor. The budget neutrality adjustment factor is calculated by comparing what we would have paid using current rates and the 1983 wage index to what would be paid using current rates and new wage index. The budget neutrality adjustment factor is computed and applied annually. For the FY 2006 hospice wage index, the FY 2005 hospice payment rate was used in the budget neutrality adjustment factor calculation.

Raw wage index values below 0.8 are adjusted by the greater of: (1) The hospice budget neutrality adjustment factor; or (2) the hospice wage index floor (a 15 percent increase) subject to a maximum wage index value of 0.8. For example, County A has a prefloor, pre-reclassified hospital wage index (raw wage index value) of 0.4000. We would perform the following calculations using the budget neutrality factor and the hospice wage index floor to determine County A's hospice wage index: (Raw wage index value below 0.8 × budget neutrality adjustment factor) = 0.4000 (1.060988) = 0.4244 (Raw wage index value below 0.8 × hospice wage index floor) = 0.400 (1.15) = 0.4600. Based on these calculations, County A's hospice wage index would be 0.4600.

C. Hospice Provisions of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003

On December 8, 2003, the Congress enacted the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 (Pub. L. 108-173). This legislation provided for the following provisions affecting hospice services:

  • Section 408, Recognition of Attending Nurse Practitioners as Attending Physicians to Serve Hospice Patients.
  • Section 512, Coverage of Hospice Consultation Services.
  • Section 946, Authorizing Use of Arrangements to Provide Core Hospice Services in Certain Circumstances.

Section 408 of the MMA amended sections 1861(dd)(3)(B) and 1814(a)(7) of the Act to add nurse practitioners (NPs) to the definition of an attending physician for beneficiaries who have elected the hospice benefit. In other words, if a beneficiary's primary care provider before the determination of the Start Printed Page 45131terminal illness and election of the hospice benefit is an NP, the NP can remain as the attending physician, if the beneficiary chooses, after a hospice election. If the beneficiary does not have an attending physician or NP at the time of the terminal diagnosis, the beneficiary may choose to designate either a physician or an NP as his or her attending physician when electing the hospice benefit. Section 408 of the MMA was implemented through an administrative issuance (Change Request (CR) 3226, Transmittals 22 and 304, September 24, 2004).

Section 512 of the MMA provides for a one-time evaluation and consultation to Medicare beneficiaries who have been determined to have a 6-month prognosis if the disease runs its normal course, and who require the expertise of the medical director or physician employed by a hospice in order to be able to make end-of-life decisions. This provision was implemented in the CY 2005 Physician Fee Schedule final rule published in the November 15, 2004 Federal Register (69 FR 66335) and is incorporated in our regulations at § 418.205 and § 418.304(d).

Section 946(a) of the MMA allows a hospice program “in extraordinary, exigent, or other non-routine circumstances, such as unanticipated period of high patient loads, staffing shortages due to illness or other events, or temporary travel of a patient outside a hospice program's service area, * * * “ to enter into arrangements with another hospice program to provide services to beneficiaries. Section 946(b) of the MMA provides that “in the case of hospice care provided by a hospice program under arrangement under section 1861(dd)(5)(D) made by another hospice program, the hospice program that made the arrangements shall bill and be paid for the hospice care.” In section II.B.2 of this proposed rule, we discuss our proposal to revise the regulations to implement payment for hospice services made under arrangements. We have addressed implementation of section 946(a) of the MMA in the proposed rule entitled “Medicare and Medicaid Programs; Hospice Conditions of Participation” published in the May 27, 2005 Federal Register (70 FR 30840).

II. Provisions of the Proposed Regulations and Analysis of and Responses to Public Comments

In the April 29, 2005 Federal Register (70 FR 22394), we published a proposed rule that set forth the proposed FY 2006 hospice wage index, including changes to the Medicare hospice wage index proposed as a result of OMB revised definitions of geographical statistical areas, and proposed implementation of several provisions of the MMA. In this section of the final rule, we will discuss these proposals, the public comments received, and our responses. We note receipt of approximately 80 timely items of correspondence that raised 8 issues.

A. Changes to the Hospice Wage Index for FY 2006

1. Revised OMB Definition for Geographical Statistical Areas

As required by § 418.306(c), each hospice's labor market is established using the most current hospital wage data available, including any changes to the MSA definitions issued by OMB. In the September 4, 1996 hospice wage index proposed rule (61 FR 46579), we explained that the MSA definitions were issued by OMB on December 28, 1992, based on the 1990 census, and updated by OMB based on the decennial census. In accordance with our regulations, any changes to the MSA definitions would be announced in the Federal Register.

In the August 27, 2004 Federal Register (69 FR 52710), we published a notice with respect to the hospice wage index for FY 2005. In that notice, we noted that on June 6, 2003, OMB issued OMB Bulletin No. 03-04 announcing revised definitions for MSAs, new definitions for Micropolitan Statistical Areas and Combined Statistical Areas, and guidance on using the statistical definitions. (A copy of the Bulletin may be obtained at the following Internet address:​omb/​bulletins/​b03-04.html.) In addition, we noted that we would not address the new OMB definitions because the wage data used to calculate the FY 2005 hospice wage index (FY 2004 hospital wage data) did not reflect revisions based on the new definitions. We indicated that the new OMB definitions would be addressed in the FY 2006 wage index update.

a. Background

In general, under the 1990-based definitions used for the hospital wage index, we define an urban area as a Metropolitan Statistical Area (MSA) or New England County Metropolitan Area (NECMA). A rural area is defined as any area outside of the urban area. Any area not included in an MSA is considered to be nonurban and receives the statewide rural rate.

In accordance with our regulations for hospice payment, we base the hospice wage index on the most current hospital wage data available. Similar to the hospital wage index, we use the MSAs to define labor market areas. Section 1814(i)(2)(D) of the Act requires Medicare to pay for hospice services based on the geographic location where the service is furnished. The wage index value used is based upon the location of the beneficiary's home for routine home care and continuous home care and the location of the hospice agency for general inpatient and respite care.

In the April 29, 2005 proposed rule, we addressed the new OMB definitions and their application to the hospice wage index. Since our regulations require the use of the acute care hospital inpatient prospective payment system (IPPS) wage data as the basis for determining the hospice wage index, we provided a summary of the revised geographical statistical areas adopted in the FY 2005 IPPS final rule. (For a more detailed discussion of the changes in the hospital wage index based on the new OMB definitions see the FY 2005 IPPS proposed and final rules published May 18, 2004 (69 FR 28196) and August 11, 2004 (69 FR 48916).)

b. Current Labor Market Areas Based on MSAs Used in the FY 2004 Hospital Wage Index

In the FY 2005 IPPS final rule, we described the hospital wage index methodology in place before adoption of the new OMB definitions (CBSAs). We stated that, “the [hospital] wage index is calculated and assigned to hospitals on the basis of the labor market area in which the hospital is located.” In addition, the IPPS final rule (69 FR 49026) provided the following as the current (before FY 2005) definition of the hospital labor markets:

* * * areas based on the definitions of Metropolitan Statistical Areas (MSAs), Primary MSAs (PMSAs), and New England County Metropolitan Areas (NECMAs) issued by OMB. OMB also designates Consolidated MSAs (CMSAs). * * * For purposes of the hospital wage index, we use the PMSAs rather than CMSAs because they allow a more precise breakdown of labor costs. If a metropolitan area is not designated as part of a PMSA, we use the applicable MSA.

These different designations use counties as the building blocks upon which they are based. Therefore, hospitals are assigned to either an MSA, PMSA, or NECMA based on whether the county in which the hospital is located is part of that area. For purposes of the IPPS wage index, we combine all of the counties in a State outside a designated MSA, PMSA, or NECMA together to calculate a statewide rural wage index.

c. Core-Based Statistical Areas

In the December 27, 2000 Federal Register (65 FR 82228 through 82238), OMB announced its new standards and in that notice, OMB defined a Core-Start Printed Page 45132Based Statistical Area (CBSA), beginning in 2003, as “a geographic entity associated with at least one core of 10,000 or more population, plus adjacent territory that has a high degree of social and economic integration with the core as measured by commuting ties.” The standards designate and define two categories of CBSAs: MSAs and Micropolitan Statistical Areas (65 FR 82235).

According to OMB, MSAs are based on urbanized areas of 50,000 or more population, and Micropolitan Statistical Areas (referred to in further discussion as Micropolitan Areas) are based on urban clusters of at least 10,000 population but less than 50,000 population. Counties that do not fall within CBSA (either MSA or Micropolitan Areas) are deemed “Outside CBSAs.” In the past, OMB defined MSAs around areas with a minimum core population of 50,000, and smaller areas were “Outside MSAs.”

In its June 6, 2003 bulletin, OMB announced the new CBSAs, comprised of MSAs and the new Micropolitan Areas based on Census 2000 data. The new CBSA designations recognize 49 new (urban) MSAs and 565 new Micropolitan Areas, and revised the composition of many of the existing (urban) MSAs. There are 1,090 counties in MSAs under these new CBSA designations compared with 848 counties in the previous MSAs. Of these 1,090 counties, 737 are in the same MSA as they were before the changes, 65 are in different MSAs, and 288 were not previously designated to any MSA. There are 674 counties in Micropolitan Areas. Of these, 41 were previously in an MSA, while 633 were not previously designated to an MSA.

d. Revised Labor Market Areas

As discussed in the FY 2005 IPPS final rule (69 FR 49027), alternatives to the use of MSAs for the purpose of establishing labor market areas for the Medicare hospital wage index were examined. In the May 27, 1994, IPPS proposed rule (59 FR 27724), the latest research concerning possible future refinements to the labor market areas was presented. In the June 2, 1995 IPPS proposed rule (60 FR 29219), it was noted that the public comments on the May 27, 1994 proposals reflected no consensus on the choice for new labor market areas. Many hospitals expressed dissatisfaction with all of the potential alternatives to the OMB-based labor market areas. In addition, consulted associations did not suggest ideas or alternatives for future research. Consequently, MSAs have continued to be used to define labor market areas for purposes of the wage index by many Medicare payment systems.

(1) New England County Metropolitan Areas

NECMAs are currently used in the hospice wage index to define labor markets areas in New England, “* * * because these are county-based designations rather than the 1990 MSA definitions for New England which used minor civil divisions such as cities and towns” (69 FR 28250). Under the CBSA definition, “OMB has defined the MSAs and Micropolitan Areas in New England on the basis of counties. OMB also established New England City and Town Areas, which are similar to the previous New England MSAs” (69 FR 28250). Therefore, to maintain consistency in the definition of labor market areas between New England and the rest of the country, IPPS decided to use the New England MSAs under the new CBSA definition.

(2) Metropolitan Divisions

Under OMB's new CBSA designations, a Metropolitan Division is a county or group of counties within a CBSA that contains a core population of at least 2.5 million, representing an employment center, plus adjacent counties associated with the main county or counties through commuting lines. For the IPPS wage indices before FY 2005, where the PMSAs were used, rather than CMSAs, to define labor market areas for the FY 2005 hospital wage index, we adopted metropolitan divisions rather than CBSAs as the building blocks for labor market areas. As with PMSAs, where they exist, these Metropolitan Divisions “* * * comprise a smaller geographic area with potentially varying labor costs due to different local economies.” (69 FR 28250)

(3) Micropolitan Areas

The FY 2005 IPPS final rule noted the following regarding the use of Micropolitan Areas to define labor markets (69 FR 49029):

One of the major issues with respect to the new definitions is whether to use Micropolitan Areas to define labor market areas for the purpose of the IPPS wage index. * * *

Because we currently use MSAs to define urban labor market areas and we group all the hospitals in counties within each State that are not assigned to an MSA together into a statewide rural labor market area, we have used the terms “urban” and “rural” wage indexes in the past for ease of reference. However, the introduction of Micropolitan Areas complicates this terminology because these areas include so many hospitals that are currently included in the statewide rural labor market areas * * * We use the term “rural” hospitals to describe hospitals in counties that are not assigned to either an MSA or a Micropolitan Area * * * hospitals in Micropolitan Areas are included in the statewide rural labor market areas.

2. Annual Update to the Hospice Wage Index

a. Background

Section 418.306(c) of the regulations requires that we issue annually in the Federal Register, hospice wage index based on our most current available hospital wage data, including any changes to the definitions of MSAs.

Section 4441(a) of the Balanced Budget Act of 1997 (BBA) amended section 1814(i)(1)(C)(ii) of the Act to establish updates to hospice rates for FYs 1998 through 2002. Hospice rates were to be updated by a factor equal to the hospital market basket index, minus 1 percentage point. However, neither the BBA nor subsequent legislation specified the hospital market basket adjustment to be used to compute payment for FY 2006. Therefore, payment rates for FY 2006 will be updated according to section 1814(i)(1)(C)(ii)(VII) of the Act, which specifies that the update to the payment rates after FY 2002 will be the hospital market basket percentage increase for the fiscal year. This rate update will be implemented via administrative issuance to provide adequate time to implement system change requirements and is not part of this final rule.

We note that we did not propose any modifications to the hospice wage index methodology as described in the 1997 final rule. In accordance with the our regulations and the agreement signed with other members of the Hospice Wage Index Negotiated Rulemaking Committee, we will continue to use the most current hospital data available to adjust for area wage differences. As noted above, payment rates for each of the four levels of care (routine home care, continuous home care, respite care, and general inpatient care) are adjusted annually based upon the hospital market basket for that year and are promulgated administratively to allow for sufficient time for system changes and provider notification.

The payment rates are divided into the labor and nonlabor portions. The appropriate wage index value is applied to the labor portion of the hospice rate based on the geographic area in which the beneficiary resides when receiving routine home care or continuous home care. The appropriate wage index value is applied to the labor portion of the hospice rate based on the geographic Start Printed Page 45133area of the hospice agency for beneficiaries receiving general inpatient or respite level of care.

We use the previous fiscal year's hospital wage index data to calculate the hospice wage index values. For FY 2006 proposed and final hospice wage index, we used the FY 2005 hospital pre-floor and pre-reclassified hospital wage data. This means that the hospital wage data used for the hospice wage index is not adjusted to take into account any geographic reclassification of hospitals including those in accordance with section 1886(d)(8)(B) or 1886(d)(10) of the Act. We also do not take into account reclassifications in accordance with section 508 of the MMA or the out-migration adjustment for hospitals (section 505 of the MMA). All hospice wage index values for FY 2006 are adjusted by either the FY 2006 budget neutrality adjustment factor or the wage index floor adjustment. This means, that for wage index values 0.8 or greater, the value is multiplied by the budget neutrality adjustment factor. For wage index values that are below 0.8, either the budget neutrality adjustment factor or the wage index floor, not to exceed 0.8, is applied. In other words, the floor adjustment is the greater of the raw wage index value multiplied by the proposed budget neutrality adjustment factor or the raw wage index value for that area is multiplied by 15 percent subject to a maximum value of 0.8. Budget neutrality means that, in a given year, estimated aggregate payments for Medicare hospice services using the updated wage index will equal estimated payments that would have been made for the same services if the wage index adopted for hospices in 1983 had remained in effect. For a detailed discussion of the methodology used to compute the hospice wage index see the September 4, 1996 proposed rule (61 FR 46579) and the August 8, 1997 final rule (62 FR 42860).

Comment: We received a number of comments that the methodology used to compute the wage index values were not valid. One commenter indicated that the FY 2006 wage index values were computed only on the basis of CBSA data. Several commenters noted that the hospice methodology did not provide for fluctuations in wage index values. One commenter stated, “* * * the regulatory intent of the movement to more ‘refined’ geographic areas under CBSA was to produce a more local wage index so as to reduce reliance on [hospital] geographic reclassification as a means of redressing inappropriate payment levels.” Another commenter stated if wage index changes “were the result of an unbiased methodology * * * aggregate impacts should even out * * *” The commenter also asserts that hospital cost report changes, “as well as methodology nuances in the hospital wage index methodology, mask the true changes in wages * * *”

Response: As stated previously, the CBSA designations define the geographic locations from which the hospital wage data are used to compute the hospice wage index. As discussed in previous hospice proposed and final rules and wage index notices, the hospice wage values are developed in accordance with § 418.306(c) of the regulations. A negotiated rulemaking process was used to update the hospice wage index in response to the recognition that the then existing wage index was not satisfactory. Industry and consumer representatives were willing to work towards developing a consensus, based on the mutual recognition that there were opportunities for compromising among various interests, and, the concomitant recognition that the acceptability of the resulting wage index would be enhanced by information-sharing in the context of negotiation. A hospice negotiated rulemaking committee comprised of representatives of national hospice associations; rural, urban, large, and small hospices; multisite hospices; consumer groups; and government agents was established. The committee reached consensus on a hospice wage index that resulted in the methodology in our regulations. A proposed rule was published in the Federal Register on September 4, 1996 with the final rule published in the Federal Register on August 8, 1997. The committee decisions are as follows:

  • The annual wage index would be based on the most currently available data used to construct a wage index for hospitals under the prospective payment system, before adjustments are made to geographic reclassification of hospitals in accordance with sections 1886(d)(8)(B) and (d)(10) of the Act.
  • Each hospice labor market area would be established by the MSA definitions issued by and periodically updated by the OMB. Any changes to the MSA definitions would be effective annually.
  • Each year in updating the wage index, aggregate Medicare payments to hospices would remain the same, using the revised wage index as if the 1983 wage index had not been updated. This means that although payments to hospices may change each year, overall Medicare payments to hospices would not be affected by updating the wage index.
  • To ensure budget neutrality, an adjustment would be made to the payments that would otherwise be made to individual hospices. The amount of the budget neutrality adjustment would be determined by computing the amount of hospice payments that would have resulted from the hospice payment methodology using the 1983 hospice wage index. Then computing the expenditures using the updated hospital wage index data. To ensure that overall Medicare payments to hospices would not be affected by updating the wage index, a budget neutrality adjustment factor is calculated each year.
  • A wage index floor would be developed in order to maintain viability of the hospice programs in rural and other locations with low hospital wage index values. For areas below 0.8 either the budget neutrality adjustment factor or the floor (15 percent) not to exceed 0.8 would be used.

As discussed in the April 29, 2005 proposed rule, we did not propose to change the methodology used in computing the hospice wage index and that any changes to the methodology would be addressed in future rulemaking.

We also believe that we are consistent in complying with regulations and the recommendations of the negotiated rulemaking committee in our calculations. This includes utilizing the OMB changes, which reflect geographic variations. In addition, the hospice wage index methodology provides mechanisms to augment the hospital wage index data. The budget neutrality adjustment factor accounts for a more than 6 percent increase above the hospital wage index for values greater than or equal to 0.8. Values below 0.8 are increased by the hospice wage index floor.

We are unable to address the comments on the calculation of the hospital wage index. However, we can address these comments as they pertain to the hospice wage index. We do agree with commenters that in adopting the 2000-based CBSA designations, some hospices will now be assigned to a different geographic area than under the old 1990-based designations. Such reassignment could result in a hospice receiving a wage index value lower than what it would have received had the 1990-based designations remained in effect for the foreseeable future. This might be the case, for example, if a high wage hospital has been redesignated from a certain hospice's labor market area to another neighboring labor market area, thus depriving its previous labor market area of the wages associated with such a high-wage hospital. We believe Start Printed Page 45134that such changes, because they result from the most recent census data, are proper. These changes merely reflect how the boundaries of various labor market areas should be drawn in order to reflect the most recent population and commuting data obtained from the 2000 census. Indeed, just as the boundaries of the OMB labor market areas may change every 10 years to reflect the most recent population data, the wages paid by hospitals located in specific labor market areas also will likely vary on a year-to-year basis. This type of fluctuation is wholly appropriate because it reflects the regional economic environment of a specific labor market area and reflects our intent in instituting wage indexing

b. Implementation of the Revised Labor Market Designations

For the hospice payment system, § 418.306(c) requires that the hospice wage index be “based on the most current available CMS hospital wage index, including any changes to the definitions of Metropolitan Statistical Areas.” We continue to believe MSAs are a reasonable and appropriate proxy for developing geographic areas for purposes of adjusting for wage differences in hospice. We also note that MSAs are used to define labor market areas for purposes of the wage index for many of the other Medicare payment systems (for example, long-term care hospital (LTCH) PPS, inpatient rehabilitation facility (IRF) PPS, home health agency (HHA) PPS, skilled nursing facility (SNF) PPS, outpatient (OPPS) and inpatient psychiatric facility (IPF) PPS).

First, historically, Medicare prospective payment systems have used metropolitan area (MA) definitions developed by OMB. For example, in adopting the MSA designation for the IPPS area labor adjustment, the Secretary stated:

[i]n administering a national payment system, we must have a national classification system built on clear, objective standards. Otherwise the program becomes increasingly difficult to administer because the distinction between rural and urban hospitals is blurred. We believe that the MSA system is the only one that currently meets the requirements for use as a classification system in a national payment program. The MSA classification system is a statistical standard developed for use by Federal agencies in the production, analysis, and publication of data on metropolitan areas. The standards have been developed with the aim of producing definitions that will be consistent as possible for all MSAs nationwide (49 FR 27426).

In addition, in numerous instances, the Congress has recognized that the areas developed by OMB may be used for differentiating among geographic areas for Medicare payment purposes. For example, in the IPPS statutory section, section 1886(d)(2)(D) of the Act, the Congress defines an “urban area” as “an area within a Metropolitan Statistical Area (as defined by the Office of Management and Budget) or within such similar area as the Secretary has recognized.” Similarly, in the sections of the statute governing the guidelines to be used by the Medicare Geographic Classification Review Board for purposes of reclassification, sections 1886(d)(10)(A) and (D)(i)(II) of the Act, the Congress directed the Secretary to create guidelines for “determining whether the county in which the hospital is located should be treated as being part of a particular [MSA].” Thus, the Congress has accepted and ratified the use of MSAs as an inherently rational manner of dividing up labor-market areas for purposes of Medicare payments.

The process used by OMB to develop the MSAs creates geographic areas that are based upon characteristics we believe also generally reflect the characteristics of unified labor market areas. For example, the CBSAs reflect a core population plus an adjacent territory that reflects a high degree of social and economic integration. This integration is measured by commuting ties, thus demonstrating that these areas may draw workers from the same general areas. OMB reviews its MA definitions preceding each decennial census to reflect recent population changes, and the CBSAs are based on the Census 2000 data. Finally, in the context of the inpatient prospective payment system, we have reviewed alternative methods for determining geographic areas for purposes of the wage index, and in each case, have determined to remain with the OMB designations rather than replace these designations with alternatives.

As stated previously, § 418.306(c) requires the hospice wage index to reflect changes to the definitions of MSA. Therefore, we proposed adopting the revised labor market area designations based on OMB's CBSA designations. For the FY 2006 hospice wage index proposed rule, we proposed to adopt the CBSA designations as finalized in the FY 2005 IPPS final rule (69 FR 49032). We believe that OMB's CBSA designations, based on Census 2000 data, reflect the most recent available geographic classifications (MA definitions). As noted, we did not propose to change the methodology used in computing the wage index, and that any changes to the methodology would be addressed in future rulemaking.

As discussed in the FY 2005 IPPS final rule (69 FR 49032), when the IPPS adopted the revised labor market areas based on OMB's new CBSA designations on October 1, 2004, IPPS established a transition to the new designations to mitigate the resulting adverse impact on certain hospitals. Section 1814(i)(1)(A) of the Act requires hospice payment to be based on “costs which are reasonable and related to the cost of providing hospice care or which are based on such other tests of reasonableness the Secretary may prescribe in regulations * * *” Our regulations at § 418.306(c) require us to issue annually in the Federal Register “a hospice wage index based on the most current available CMS hospital data wage data, including any changes to the definitions of Metropolitan Statistical Areas.” In the proposed rule we stated that it appeared that this language would not seem to permit us to establish a transition to the new CBSA designations. Unlike IPPS and other payment systems where each entity uses a single MSA (CBSA), hospice agencies may use various wage indices to compute their payments, based upon the location of the beneficiary for routine and continuous home care or the MSA (CBSA) for the location of the agency for respite and general inpatient care. The methodology for applying the budget neutrality adjustment factor to the hospital wage data results in over a 6.0 percent increase from the wage data. The application of the hospice floor (a 15.0 percent maximum) to wage index values below 0.8 is used to leverage areas where there are significantly low wage index values. Moreover, we did not believe that in the aggregate, hospice agencies would be impacted negatively by the new CBSA designations. The existing methodology of computing the hospice wage index, the annual calculation of the hospice payment rates based upon the market basket index, and the variability of CBSAs that may be attributed to different hospice agencies we believed would be are sufficient to mitigate adverse effects on individual hospice agencies. We acknowledged that some CBSAs will experience decrease payments based upon the new definitions. However, there are those that are positively affected. For example, many counties that have been included in the rural definitions under the MSA designations are now designated as urban areas under the CBSA based on labor market areas, and will generally receive an increase in Start Printed Page 45135their wage index. We also indicated that if adjustments were to be made to CBSAs because of negative impact, adjustments would also need to be made to CBSAs that are positively impacted. Variability and changes in wage indices both positively and negatively have occurred under the MSA designations and occur as a result of geographic differences. As a result, we proposed adopting the CBSA definitions and resulting wage indices without transitions. However, we received numerous public comments in disagreement and found them persuasive enough to undertake further analysis which is described in this regulation.

In adopting the CBSA designations, we identified rural labor market areas where there were no rural hospitals and thus no FY 2005 hospital wage index data on which to base the calculation of the FY 2006 hospice wage index. Since there was no reasonable proxy for more recent rural hospital data within Massachusetts, we proposed to use the pre-floor, pre-reclassified hospital wage index data for FY 2005 and apply the FY 2006 proposed budget neutrality factor. If in the future there are rural areas without hospital wage index data from which a hospice wage index can be derived, we also proposed to use a comparable methodology to derive a wage index. Similarly, if we encounter an urban labor market without an urban hospital from which a hospital wage index can be derived, we proposed to use all of the urban areas within the State as a reasonable proxy for computing a hospice wage index. In these circumstances we would calculate the urban wage index value for areas without urban hospital data as the average wage index for all urban areas within the State. We are not able to apply a similar averaging in rural areas, because there would be no rural hospital wage data available for averaging on a statewide basis.

We note that in the proposed rule, a wage index value of 0.8 had been incorrectly placed in the tables representing the CBSA wage index value for Puerto Rico. In computing the CBSA wage index value for this final rule we identified that there were no IPPS hospitals and thus no hospital wage index data on which to base calculations of the FY 2006 hospice wage index for rural Puerto Rico. As noted above, in the discussion of a comparable situation in Massachusetts, we applied the same methodology of using the FY 2005 pre-floor, pre-reclassified hospital wage index data to derive a FY 2006 wage index for rural Puerto Rico under the CBSA designations.

Comment: One commenter noted that a more reasonable proxy for determining the wage index for rural areas where there are no hospitals is to use data submitted by critical access hospitals.

Response: As discussed in the proposed rule as well as above, since there is no reasonable proxy for more recent rural data within Massachusetts and Puerto Rico, we used the FY 2005 pre-floor, pre-reclassified hospital wage index data to derive a wage index. Since the hospital wage data used in the FY 2006 hospice wage index represents the most recent data available, we believe that this is the most appropriate proxy to use. We intend to use a comparable methodology for hospice wage index updates if there are no hospital data to derive a wage index in subsequent years. Similarly, if there are urban areas without hospital wage index data, we believe that it is reasonable to use an average of all of the urban areas within the State as a reasonable proxy.

Since critical access hospitals (CAHs) are not part of the IPPS, there is no wage data from the CAHs reflected in the pre-floor, pre-reclassified hospital wage data used to calculate the hospice wage index. As a result, we believe that our proposed methodology can be used as a reasonable proxy for areas that have no hospital wage data to calculate the area's wage index.

Comment: We received a number of comments indicating that the adoption of the CBSA designations would negatively impact hospice agencies due to wage indices being lower than those received in FY 2005. While specific counties, States, areas and hospice providers were cited by the commenters, we are summarizing the comments without addressing the specific areas. Commenters cited the movement from MSAs to CBSAs as resulting in a decrease in wage index values. One commenter stated that over 80 percent of all counties would experience a wage index decrease due to the new CBSA designations. These commenters were concerned about the impact of these decreases on access to hospice care. Several commenters suggested that CMS should ensure that any decreases in wage index values should not exceed 2 to 5 percent annually. Two commenters disagreed with our statement that in the aggregate, hospice agencies would not be negatively impacted. Several commenters also expressed concerns with significant swings in the wage index values that are often hard to predict. Some commenters asserted that more patients would be hospitalized due to the decrease in wage index values.

Response: We appreciate the detailed concerns sent by commenters regarding the impact of implementing the CBSA designations on their geographic locations or their hospice agency. While these comments only addressed the negative impact on commenters' geographic areas or hospices, we note that there are a number of geographic locations and hospice providers that will be positively impacted upon implementation of the CBSA designations.

As noted above, the hospice wage index is computed annually based on the most recent hospital wage data. For the FY 2006 hospice wage index, we use the FY 2005 hospital wage data. We also indicated above that a budget neutrality adjustment factor is computed annually. Either the budget neutrality adjustment factor or the wage index floor is applied to the hospital wage data. This results in an adjustment of 6 to 15 percent above the hospital wage data. We acknowledge that the FY 2006 budget neutrality adjustment factor computed for this final rule is lower than that computed for the proposed rule. We attribute this to the use of FY 2004 claims processed through March 2005 for computations used in this final rule, in contrast with FY 2003 claims processed through June 2004 for computations used in the April 29 proposed rule. However, the variability of the budget neutrality adjustment factor in previous years is unrelated to the adoption of the CBSA designations. We provide the following chart to demonstrate this phenomenon.

FY regulatory documentTotal expenditureBudget neutrality adjustment factor—MSABudget neutrality adjustment factor—CBSA
2006 Final Rule$7,079,595,0001.0603391.060988
2006 Proposed Rule6,086,726,0051.0644351.063479
2005 Notice5,873,005,0001.065819N/A
2004 Notice3,775,993,0001.061238N/A
Start Printed Page 45136
2003 Notice3,684,027,0001.063422N/A

We recognize that there are areas which will experience a decrease in their wage index, but there are also areas which will experience an increase. However, as noted by one commenter, variability in wage index values occurs each year and has been noted in the hospice wage index notices issued annually. While the hospice payment rates are increased each year based upon the hospital market basket, the wage index values are adjusted based upon the hospital wage data, which may increase or decrease. We do not believe that under a prospective payment system, wage index values can be assured to increase on an annual basis.

We disagree that the annual fluctuations are not predictable. Since the hospice wage index utilizes the previous year's hospital wage index data, it is possible for hospice agencies to review the hospital wage index values approximately 1 year before the hospice implements the values. We appreciate the comments stating that additional time was required for hospice providers to make changes as a result of the new designations. However, the adoption of the new CBSA designations has been a possibility for over 3 years. In the 1997 hospice wage index final rule, we indicated that any changes made by the OMB to the MSA designations would be used in calculating the hospice wage index. The OMB released its new designations on June 6, 2003. The FY 2005 hospice wage index notice indicated that we would be addressing the CBSA designations in FY 2006. We believe that this sequence of events provided ample time for hospices to become aware of the impending changes. While some commenters believed changes to the wage index values would result in a risk to access to hospice care, we were not provided with any empirical data to support their assumption as to whether the reduction was due to the CBSA designations or due to past with decreases. We believe that access may in fact improve with the increase in wage index values that some areas will experience as a result of the CBSA designations.

We received no suggestions on how the change impacts on access and on the financial stability of hospice providers could or should be measured. We believe that while in theory this type of measurement seems plausible, in reality it would be difficult to do a provider level analysis when the site of service is variable and often changes. As noted in the April 29, 2005 proposed rule, we did not propose to change the methodology used in computing the wage index, and that any changes to the methodology would be addressed in future rulemaking.

We reiterate that, in the aggregate, hospice agencies would not be negatively impacted. As discussed above, this final rule only reflects the impact of the wage index values on individual hospices, and does not reflect total payments for FY 2006. This means that any payment projections in this final rule reflect only the change in the wage index and does not reflect any changes that incorporate the FY 2006 payment rates. We also discussed that the FY 2006 payment rates would actually increase as a result of the market basket increase and that the increased payment rates would be promulgated through administrative issuance. We believe that this payment increase, which is not subject to the budget neutrality requirement, will offset, in the aggregate, any decreases that may occur as a result of the adoption of the CBSA designations.

Comment: We received comments arguing that the implementation of the CBSA designations would result in an overall reduction in reimbursement. Many commenters stated that due to hospice providers facing higher operating costs, CMS should change the rates. Others commented that CMS should ensure that rates do not decrease from one year to the next.

Response: While there are counties that will experience a decrease in their wage index, overall reimbursement will also reflect the payment increase based upon the full market basket. The FY 2006 payment rates will be promulgated through administrative issuance.

Section 1814(i)(1)(C)(ii)(VII) of the Act stipulates that the payment rates are to be increased annually by the market basket percentage increase. Since the annual payment rate increase is promulgated through administrative issuance, hospice providers can generally anticipate that their payment rates will be increased. It is only the wage component of the FY 2006 payment rates that are subject to the wage indices in this final rule.

Comment: We received many comments requesting that hospices assume the wage index value of an adjacent county with a higher wage index. One commenter indicated that wage area adjustments should accurately reflect wage level differences among areas throughout the nation. The same commenter stated that wage areas “must recognize the realities of labor markets” and that area borders “are somewhat arbitrary.”

Response: While specific counties were addressed in the comments, we have summarized the content without addressing specific counties and requests. On June 6, 2003 the OMB published the new MSA designations (A copy of the Bulleting may be obtained at the following internet address:​omb/​bulletins/​b03-04.html.). We noted in the August 27, 2004 Federal Register (69 FR 52710), that we would be addressing the CBSA designations in the FY 2006 wage index update. In that rule we also indicated that OMB had issued the new designations. In the FY 2005 proposed rule we indicated that the MSA designations as well as the CBSA designations are determined by OMB. The OMB reviews its MA definitions preceding each decennial census to reflect recent population changes. We also indicated in the proposed rule, that we believed that OMB's CBSA designations reflect the most recent available geographic classifications and were a reasonable and appropriate way to define geographic areas for purposes of wage index values. Consequently, we do not believe that the commenter is correct in the assertion that area borders are arbitrary, since the OMB has defined those borders for the CBSA based on specifically defined criteria, as they did for the MSAs.

While the new designations do negatively impact some hospice providers, there are other hospice providers who will be positively impacted. Wage index values may fluctuate from year to year based on the hospital wage data. Claims used may also fluctuate based upon volume and distribution of the payments across providers. As a result, wage index values can increase or decrease from year to year, regardless if the CBSA designations are adopted.

As indicated in the discussions above, geographic differences are reflected in the wage index values. Wage index values are adjusted nationally to all Start Printed Page 45137MSA values by applying a budget neutrality adjustment factor, which for FY 2006 is 1.060988, based on CBSA designation, for those hospices with a wage index value greater than or equal to 0.8 and either the budget neutrality adjustment factor or the hospice floor of up to 15 percent for hospices with a wage index value of less than 0.8.

Comment: We received many comments that recommend various revisions to the proposed labor market definition. Many of these focused on specific situations, particularly in those areas in which large MSAs were divided into smaller MSAs under the new definition. Some commenters suggested that counties should be reclassified as area hospitals have been. Others suggested that counties maintain their current MSA designation. Some commenters suggested that counties receive wage index values comparable to an adjacent CBSA with a higher wage index value. Some of the commenters suggested that an appeal mechanism be initiated to allow hospices to appeal their classifications. Several commenters suggested that a rural floor be adopted for areas with low wage index values that are lower than values applied to hospitals in rural areas. Several argued that the Secretary has broad latitude to address wage index inequities.

Response: While specific counties were cited in the comments, we are responding in general and are not addressing specific counties. As noted above, sections 1886(d)(10) and 1886(d)(8)(B) of the Act provide for a process by which hospitals may request to be reclassified into another geographic area. The statute does not include hospices. Our view is that we have no authority to move hospice providers from one CBSA to another CBSA designation or to allow hospice agencies to select the CBSA designation based upon which designation represents the majority of their patients. We believe that this request would require a statutory amendment. Our view is that while we do not have the authority to reclassify hospice providers into different geographic areas, the statute does provide the Secretary with broad authority to establish a payment methodology for hospice and as stated above, the negotiated rulemaking committee recommended the use of the OMB labor market areas for purposes of the wage index. We continue, for reasons discussed above, to believe those definitions to be appropriate.

As noted above hospitals are the only entities that have statutory authority to request a geographic reclassification. Providing a mechanism of appeal without the authority to reclassify a hospice provider would not accord any resolution. We believe that a change in the statute would be required in order to implement an appeal process.

Comment: One commenter indicated “Because reimbursement is calculated according to the residence of the patient, a hospice may redirect its marketing efforts to patients living in a county with a more favorable wage index * * *”

Response: While the commenter indicated that this “ * * * lack of parity in wage index in contiguous areas could create better access for some * * * and more limited access for others,” this exemplifies the difficulty in determining a wage index that would satisfy all hospice providers. Furthermore, establishing a national wage index, as suggested by one commenter, would not reflect the unique economic environment of various geographic areas. As noted, we did not propose to change the methodology used in computing the wage index, and that any changes to the methodology would be addressed in future rulemaking.

Comment: We received many comments requesting that the adoption of the CBSA designations should be phased in for those areas that will experience a decrease in their wage index. One commenter suggested a 1-year transition period. Several commenters suggested a 3-year transition period. Other commenters suggested a transition for an unspecified period of time. One commenter suggested that the same hold-harmless methodology employed by the IPPS in FY 2005 be employed for the FY 2006 hospice wage index. A few commenters indicated that CMS is incorrect in their interpretation of the regulatory language in § 418.306(c).

In addition to the transitioning timeframes for implementing the adoption of the CBSA designations, some commenters offered suggestions for blending rates. One commenter recommended that the CBSA wage index values be implemented if greater than the MSA values. Another commenter recommended that 50 percent of the CBSA value and 50 percent of the MSA value be blended for 1 year. A commenter recommended that 50 percent of the FY 2005 MSA and 50 percent of the FY 2006 CBSA value be blended and phased-in over a 2 to 3 year period. Another commenter suggested that a hospice with more than a 2 percent decrease in the wage index be provided with a 2 to 3 year transition of a blended rate while another commenter suggested that the threshold be 1 percent. Several commenters recommended other blended percentages of MSA and CBSA values while others recommended varying blends with the MSA wage index portion greater than the CBSA value.

Response: We have been persuaded by some of the commenters that argue § 418.306(c) has been incorrectly interpreted. A transition period had been employed for the initial implementation of the methodology developed by the negotiated rulemaking committee. The regulatory language that addressed the adoption of any changes to the MSA definitions by the OMB did not include that a transition period was or was not to be employed when MSA definitions changed. This language was proposed and remained unchanged in the August 8, 1997 final rule. As indicated in the FY 2006 proposed rule, we were not proposing to change the methodology for calculating the hospice wage index overall and would address any changes in the methodology in future rulemaking. Since we did not propose changing the methodology, we are not amending the regulatory language in § 418.306(c).

However, we received a number of comments concerning the proposed implementation of the CBSA designations and the belief that its implementation would negatively impact hospice providers. We considered these comments in detail and conducted additional analysis regarding the impact of implementing the CBSA designations.

To determine the effect of adopting the CBSA designations on providers, we analyzed providers based on their current MSA designation to determine the impact on adopting the CBSA designations. We determined that most providers will experience less than a 5.0 percent change in their wage index values under the CBSA designations. One hundred thirty hospices, representing 5.0 percent of the 2,583 hospice providers will experience a decrease of 5.0 percent or greater when adopting the CBSA designations. Seventy-three of the 969 rural hospices and 57 of the 1,614 urban hospices will experience a decrease of 5.0 percent or more as a result of the migration from MSA to CBSA.

Likewise 97 hospice providers representing 3.8 percent of the 2,583 hospices will experience an increase of 5.0 percent or more when we adopt the CBSA designations. Seventy-four of the 969 rural hospice providers and 23 of the 1,614 urban hospice providers will experience an increase of 5.0 percent or greater. Start Printed Page 45138

As shown below, the majority of providers will experience an increase or decrease ranging from 0 to 1.0 percent. Of the 2,583 hospice providers (of which 1,614 were designated urban and 969 as rural under the MSA designations), 998 of the urban providers and 310 of the rural providers will experience an increase of approximately 1.0 percent under the CBSA designations. A decrease of approximately 1.0 percent will be experienced by 294 rural providers and 275 of the urban providers.

The increase and decrease in the wage index appears to be primarily attributed to the change from urban to rural designations under the CBSAs. In other words, providers that were designated as urban under the MSA designations, who are now classified as rural under the CBSA designations, generally will experience a decrease in their wage index. Providers designated as rural under the MSA designations, that are classified as urban under the CBSA designations generally will experience an increase in their wage index. A rural hospice may experience a decrease in its wage index if a high-wage hospital in its rural area is redesignated as urban under the CBSA designation. Since the high-wage hospital would no longer be in the same area as the rural hospice, the hospital's wage data would not be used in calculating the rural rate.

Next, the State county codes were analyzed to determine if the observations by provider were consistent to the findings by geographic area. Our findings were similar to that discussed above. Of the 3,273 counties, 287 (8.8 percent) are anticipated to experience a 5.0 percent or greater decrease. Of the 3,273 counties, 222 rural counties (6.8 percent) and 65 urban counties (2.0 percent) are anticipated to experience a 5.0 percent or greater decrease in their wage index. Of the 3,273 counties, 252 counties (7.7 percent) are anticipated to experience a 5.0 percent or greater increase in their wage index. Of these 252 counties, 229 rural counties (7.0 percent) and 23 urban counties (0.7 percent) are anticipated to experience an increase in their wage index.

As a result of numerous public comments and based on our subsequent analysis, we evaluated different options which could mitigate the effects of OMB's new designation system while remaining budget neutral to the 1983 wage index methodology and to what we would pay had we fully implemented the CBSA designations. We determined that a blended wage index comprised of 50 percent of the wage index that counties would have received had the MSA designations remained in effect and 50 percent of the wage index that counties will receive under the CBSA designations was the most equitable option. This blending would take place after the budget neutrality adjustment factor was applied to the MSA and the CBSA wage index. As the MSA and the CBSA wage index values used budget neutrality adjustment factors (1.060339 and 1.060988, respectively), the computed wage index for all areas contains a unique budget neutrality adjustment.

The charts below describe the difference by hospice providers and by counties based upon full implementation of the wage index under the CBSA designations (Before Adjustment) and upon implementation of the blended wage (After Adjustment). The blended wage index centers most providers and counties within the range of less than 5.0 percent increase or decrease in their wage index. We believe that this will mitigate any wide fluctuations in wage index values. We are implementing this blended wage index as a one-time only transition for FY 2006. We will be using the CBSA designations in future rulemaking in accordance with § 418.306(c) and the methodology established by the negotiated rulemaking committee. Any changes in the methodology for calculating the hospice wage index values will be discussed in future rulemaking.

This computation for only FY 2006 allows us to be budget neutral to 1983 as well as to what would have occurred had this computation not been done. We believe that this is in compliance with our regulations at § 418.306(c), since we have computed a wage index using the latest MSA designations and we are not proposing a longer term transition in adopting the CBSA designations. Subsequent wage index computations for FY 2007 and after will be computed solely on the CBSA designations. Any departure from this methodology will be discussed in future rulemaking.

Before adjustmentAfter adjustment
Decrease ≥0% and <1%569294275721339382
Decrease ≥1% and <5%2679916821612690
Decrease ≥5% and <10%101722924123
Decrease ≥10% and <20%24123505
Decrease ≥20%505000
No change2014620146
Increase ≥0% and <1%130831099814173841033
Increase ≥1% and <5%192105871307159
Increase ≥5% and <10%47407402614
Increase ≥10% and <20%402614972
Increase ≥20%1082110
Decrease ≥0% and <1%729593136922742180
Decrease ≥1% and <5%3662759142434777
Decrease ≥5% and <10%2512213032131
Decrease ≥10% and <20%32131404
Decrease ≥20%404000
No change3932739327
Increase ≥0% and <1%13908525381511947564
Increase ≥1% and <5%2101624819116031
Start Printed Page 45139
Increase ≥5% and <10%102939101929
Increase ≥10% and <20%10192945405
Increase ≥20%49445440

In the proposed rule (70 FR 22398), we had indicated that the implementation of the CBSA designations would not be transitioned because, among other things, any upward adjustments made to hospices because of negative impact of the CBSA implementation would need to be offset by compensating downward adjustments to hospices that were positively impacted. We stated in the proposed rule that we were not proposing to change the methodology for computing the hospice wage index, which was determined through negotiated rulemaking, and that any changes in the methodology would be discussed in future rule making. While some commenters stated that the methodology included in the regulation could be interpreted to provide for some transition to the new CBSAs, no commenters suggested that the mechanism for assuring budget neutrality be changed. It is this budget neutrality adjustment that provides for a 6.0 percent increase in the wage index.

We believe that providing a blended wage index for hospices will somewhat mitigate the deleterious effects on those hospices most negatively impacted by the new labor market area definitions, while complying with the budget neutrality methodology authorized by our regulations. Therefore, we believe it is reasonable to provide for a 1-year blended rate. Admittedly, in this transition year, some hospices will not receive the full wage index increase they would otherwise receive. We believe that by maintaining budget neutrality to what we would pay without this adjustment, as well as to what we would have paid had the 1983 wage index been used, we are in compliance with the methodology specified in the August 1997 final rule.

We acknowledge that several other provider-types affected by OMB's change have been held harmless during the transition because those payment systems (for example, IPPS) require budget neutrality in overall payments and incorporate payment rates into budget neutrality calculations. As discussed above, the hospice payment rates for FY 2006 are not included in this regulation and are promulgated through administrative issuance. As a result, the payment rates will reflect the full market basket and are not adjusted in conjunction with wage indexing.

Although, in the hospital wage index, the 1-year transition included a hold-harmless provision for those hospitals positively impacted by the new CBSAs, the budget neutrality rules of the IPPS differ from those used in the hospice wage index. In the hospital wage index, we were able to offset the hold-harmless provision through adjustments to the budget neutrality multiplier, thus ensuring payments did not exceed what would have been made had no transition been implemented. In contrast, hospice payment methodology would not permit this type of offset, thus requiring higher expenditures to implement a hold-harmless provision as part of a transition. Therefore, as stated in the proposed rule, any blended rate for hospices that are negatively affected would be offset with a blended rate for those positively affected. Otherwise, we would not be able to implement a blend, without increasing expenditures beyond what we believe is reasonable.

3. Labeling Error in the Hospice Wage Index

As noted in the proposed rule, we had discovered an error in the labeling of the wage index tables that we have been publishing in the annual hospice wage index update. That labeling error is the listing of Stanly County, North Carolina as one of the areas under MSA 1520 when, in fact, we consider Stanly County, NC to be a rural area in North Carolina. Stanly County wage data have always been correctly treated as rural in the actual creation of the hospice wage index values, and it has only been the listing of Stanly County under MSA 1520 that was in error. Consequently, we have corrected our labeling error from past notices for the hospice and have removed Stanly County from the list of areas that fall under the MSA 1520 wage index. This is strictly a ministerial correction that does not affect the actual computation of the wage index values. Hospice providers in and beneficiaries who reside in Stanly County and receive routine home and continuous home care in Stanly County will continue to fall under, and use, the wage index for rural North Carolina.

B. Proposed Changes To Implement Hospice-Related Provisions of the MMA

In section I.C. of this final rule, we noted that section 408 of the MMA was effective upon enactment and initially implemented through administrative issuances. We proposed to incorporate these provisions into regulation.

1. Coverage of Nurse Practitioner as Attending Physician in Hospice (Section 408 of the MMA)

Section 408 of the MMA amended sections 1861(dd)(3)(B) and 1814(a)(7) of the Act to add nurse practitioners (NPs) to the definition of an attending physician, for beneficiaries who have elected the hospice benefit. In other words, if a beneficiary's primary care provider is an NP, before the determination of the terminal illness and election of the hospice benefit, the NP can remain as the attending physician, if chosen by the beneficiary. If the beneficiary does not have an attending physician or NP, the beneficiary must be provided with an option of either a physician or an NP (if available and if allowed by State law) to serve as the attending physician. An NP is defined as a registered nurse who performs such services as he or she is legally authorized to perform (in the State in which the services are performed) in accordance with State law (or State regulatory mechanism provided by State law) and who meets the training, education, and experience requirements as the Secretary may prescribe.

As discussed in Change Request 3226 (Transmittals 22 and 304, September 24, 2004), beginning December 8, 2003, Medicare pays for medically reasonable and necessary services provided by NPs to Medicare beneficiaries who have elected the hospice benefit and who have selected a nurse practitioner as their attending physician. Nurse practitioners are paid 85 percent of the fee schedule amount for their services as attending physicians. Services for the terminal and related conditions provided by an NP— Start Printed Page 45140

  • Serving as the attending physician that are medical in nature must be reasonable and necessary and must be services that, in the absence of an NP, would be performed by a physician; and
  • May not be separately billed if the—

++ Services would not be reasonable and necessary if provided by an attending physician;

++ NP is not the patient's attending physician; or

++ Services would be performed by a registered or licensed nurse in the absence of a physician or nurse practitioner.

Since NPs are not physicians, as defined in 1861(r)(1) of the Act, they may not act as medical directors or physicians of the hospice or certify the beneficiary's terminal illness and hospices may not contract for their attending physician services as described in 1861(dd)(2)(B)(i)(III) of the Act. All of these provisions apply to NPs without regard to whether they are hospice employees.

We proposed to revise § 418.3, 418.22(c)(1)(ii), and § 418.304 to implement the provisions of section 408 of the MMA.

We did not receive any comments regarding these proposals; and therefore are finalizing these regulatory provisions without change.

2. Payment for Authorizing Use of Arrangements To Provide Hospice Service Under Certain Circumstances (Section 946 of the MMA)

Section 946(a) of the MMA amended section 1861(dd)(5) of the Act by adding the following: “(D) In extraordinary, exigent, or other non-routine circumstances, such as unanticipated periods of high patient loads, staffing shortages due to illness or other events, or temporary travel of a patient outside a hospice program's service area, a hospice program may enter into arrangements with another hospice program for the provision by that other program of services described in paragraph (2)(A)(ii)(I).” Section 946(a) of the MMA is discussed in this proposed rule to assist the reader in understanding how hospices will be reimbursed for these types of arrangements. We will issue more specific regulations regarding section 946(a) of the MMA in future rulemaking.

Section 946(b) of the MMA amended section 1814(i) of the Act to add the following: “(5) In the case of hospice care provided by a hospice program under arrangements under section 1861(dd)(5)(D) made by another hospice program, the hospice program that made the arrangements shall bill and be paid for the hospice care.” This means that the hospice that establishes the contractual arrangement with the hospice that will be providing services to the beneficiary, continues to bill for and receive payment during the hospice election.

Section 4442 of the BBA amended section 1814(i)(2) of the Act, effective for services furnished on or after October 1, 1997, to require hospice agencies to submit claims for payment for hospice services furnished in an individual's home on the basis of the geographic location at which the service is furnished. Therefore, the methodology for applying the wage index to the labor portion of the payment rates remains the same. This means that the wage index for routine and continuous home care would reflect the place where the service is provided, which may be outside of the hospice program's service area during periods of temporary travel. We do not propose in this rule to define “temporary travel” since this would depend upon individual needs and abilities determined by the interdisciplinary group, the beneficiary, and his or her family. The wage index for general inpatient care would reflect the MSA for the hospice agency that retains management responsibility. Payment will continue to be made to the hospice agency for which the beneficiary has made the election. We proposed to revise § 418.302(d) to implement section 946 of the MMA.

We did not receive any comments regarding this proposal; and therefore are finalizing this regulatory provision without change.

III. Provisions of the Final Regulations

This final rule essentially incorporates the provisions of the proposed rule, in which we proposed the adoption of the new MSA (CBSA) designations. The few changes we made from the proposed rule are identified below.

We are also publishing in Table A and B in the addendum, the updated urban and rural wage index values for hospices utilizing CBSA designations.

A. Rural Puerto Rico Correction

We will apply the same methodology to rural Puerto Rico that was applied to rural Massachusetts. This means that we will use the FY 2005 pre-floor, pre-reclassified hospital wage index data under the MSA designations for the FY 2006 hospice wage index for rural Puerto Rico as well as for rural Massachusetts. The FY 2006 budget neutrality adjustment factor of 1.060988 will be applied.

B. FY 2006 Wage Index

The FY 2006 hospice wage index values have been computed utilizing the revised OMB geographic location definitions (CBSAs). The budget neutrality adjustment factor was computed utilizing data from the FY 2004 claims processed through March 2005. The FY 2006 budget neutrality adjustment factors of 1.060988 and 1.060339 were applied to CBSA and the MSA hospital wage data above 0.8, respectively. The FY 2006 budget neutrality adjustment factor or the hospice floor was applied to the hospital wage data below 0.8, not to exceed 0.8.

In addition, to mitigate the effects on providers that will experience a decrease in their hospice wage index as a result of adopting the CBSA designations, a blended wage index was computed for all counties comprised of 50 percent of the hospice wage index had the MSA designations continued to be used as well as 50 percent of the CBSA hospice wage index value. We note that the use of this blended wage index is applicable only for FY 2006 and will not apply in future years. Counties within CBSAs that have different wage index values as a result of the migration from specific MSAs to specific CBSAs will require the use of specific codes to process their claims. These counties are identified in Table C. Instructions will be provided under separate administrative issuance.

To ensure that hospice providers are able to identify their current wage index, table A will contain the CBSA code, CBSA county name, CBSA wage index, and current MSA designation.

We note that subsequent to the publication of the proposed rule, there were changes to OMB Bulletin No. 05-02 (November 2004), which changes the titles of certain CBSAs. These changes have been incorporated into Tables A and C. These changes are as follows:

  • New Principal Cities/Titles

—CBSA 36740. New Title: Orlando-Kissimmee, FL MSA

—CBSA 37620. New Title: Parkersburg-Marietta-Vienna, WV-OH MSA

  • Deleted Principal City

—CBSA 42060. New Title: Santa Barbara-Santa Maria, CA MSA

  • Title Changes Resulting From Changes In Order of Cities

—CBSA 13644. New Title: Bethesda-Gaithersburg-Frederick, MD Metropolitan Division

—CBSA 32580. New Title: McAllen-Edinburg-Mission, TX MSA

—CBSA 26420. New Title: Houston-Sugar Land-Baytown, TX MSA Start Printed Page 45141

—CBSA 35644. New Title: New York-White Plains-Wayne, NY-NJ Metropolitan Division

CBSA designations will be utilized in future hospice wage index regulations.

IV. Collection of Information Requirements

Section 418.22(c)(1) requires for the initial 90-day period, the hospice must obtain written certification statements (and oral certification statements if required under § 418.22(a)(3) from the individual's attending physician, if the individual has an attending physician, that meets the definition of physician specified in § 410.20 of this subchapter.

While this requirement is subject to the PRA it is currently approved by OMB under control number 0938-0302, “ICRs in Hospice Care Regulation and Supporting Regulations,” with a current expiration date of September 30, 2006.

V. Regulatory Impact Analysis

A. Overall Impact

We have examined the impacts of this final rule as required by Executive Order 12866 (September 1993, Regulatory Planning and Review), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the Act, the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132. We estimated the impact on hospices, as a result of the changes to the FY 2006 hospice wage index. As discussed previously, the methodology for computing the wage index was determined through a negotiated rulemaking committee and implemented in the August 8, 1997 final rule (62 FR 42860). This final rule updates the hospice wage index in accordance with our regulation and that methodology, incorporating the adoption of the CBSA designations used in the hospital wage index data.

  • Table I categorizes the impact on hospices by various geographic and provider characteristics.
  • Table A reflects the FY 2006 wage index values for urban areas under the CBSA designations.
  • Table B reflects the FY 2006 wage index values for rural areas under the CBSA designations.
  • Table C represents counties that require a special code to be used for processing claims. Wage index values for these counties are a blend of what they would have received had the MSA designations remained in effect and what they will receive under the CBSA designations.
  • Table D provides a crosswalk of counties by State. It contains the county, State, county code, CBSA code, and CBSA name.

In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside an MSA and has fewer than 100 beds. We have determined that this final rule would not have a significant impact on the operations of a substantial number of small rural hospitals.

Section 202 of the Unfunded Mandates Reform Act of 1995 also requires that agencies assess anticipated costs and benefits before issuing any rule that may result in expenditure in any 1 year by State, local, and tribal governments, in the aggregate, or by the private sector, of $110 million or more. This final rule is not anticipated to have an effect on State, local, or tribal governments or on the private sector of $110 million or more.

Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have reviewed this final rule under the threshold criteria of Executive Order 13132, Federalism, and have determined that it would not have an impact on the rights, roles, and responsibilities of State, local, or tribal governments.

In accordance with the provisions of Executive Order 12866, this regulation was reviewed by the Office of Management and Budget.

1. Hospice Size

As discussed in the proposed rule, the impact of hospice wage index changes have been analyzed according to type of hospice, geographic location, type of ownership, hospice base, and hospice size. Hospice size was determined by the number of routine home care days (RHC). Since routine home care days account for over 70 percent of the services provided by a hospice, we used RHC days as a proxy for the size of the hospice agency. As discussed in the proposed rule, in the past, we had designated the size by four categories: (1) 0 to 1,754 RHC days representing small agencies; (2) 1,754 to 4,373 RHC days or (3) 4,373 to 9,681 RHC days representing medium-sized agencies; and (4) 9,681 RHC days or more representing large agencies.

To determine the statistical distribution of RHC days, based upon the total number of hospice agencies and their respective RHC days using FY 2003 claims processed through March 2004, were used. In determining the statistical distribution, we deleted data for four hospice agencies with RHC days that greatly exceeded the total number of RHC days of other agencies. However, these data have been included in the impact analysis since we recognize that the skewness existed in the “large” agency size distribution using four size categories and does not change with the use of three size categories.

Since we received no comments, we will be using only three size designations to present the impact analyses. We believe that these three designations better describe the size of the hospice. The three categories are: Small agencies having 0 to 3,499 RHC days; medium agencies having 3,500 to 19,999 RHC days; and large agencies having 20,000 or more RHC days.

2. Impact on Hospices

Our discussions for this final rule focus on the impact of adopting the CBSA designations both before and after the transition adjustment. Table I indicates the impact of using the adoption of the CBSA designations as well as the impact of computing a hybrid (blended) hospice wage index value for all areas. As discussed above, we use the latest claims file available to us to develop the impact table when we issue the annual yearly wage index update. For the purposes of this final rule, we used the 2004 claims that were processed through March 2005 since this was the latest file available. For the proposed rule, we had used the 2003 claims that were processed through June 2004. Thus the impact on the geographic location, home care days, type of ownership, hospice base as well as projections or anticipated payments indicated in the proposed rule differ than the expenditures that we anticipate for FY 2006 in the final rule. We note that estimated payments for FY 2006 are determined by using the wage index for FY 2006 and payment rates for FY 2005. As noted in previous sections, payment rates for FY 2006 are promulgated through administrative issuance.

For the purposes of this final rule, we compared estimated payments using the FY 1983 hospice wage index to estimated payments using the FY 2006 wage index and determined the proposed hospice wage index to be budget neutral. Budget neutrality means that, in a given year, estimated aggregate Start Printed Page 45142payments for Medicare hospice services using the proposed FY 2006 wage index would equal estimated aggregate payments that would have been made for the same services if the 1983 wage index had remained in effect. Budget neutrality to 1983 does not imply that estimated payments would not increase since the budget neutrality applies only to the wage index portion and not the total payment rate, which accommodates inflation. We also determined that the blended wage index allows us to be budget neutral to 1983 as well as to what would have occurred had this blend not been done.

Executive Order 12866 (as amended by Executive Order 13258, which merely reassigns responsibility of duties) directs agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis (RIA) must be prepared for major rules with economically significant effects ($100 million or more in any 1 year). We have determined that this final rule is not economically significant rule under this Executive Order.

The RFA requires agencies to analyze options for regulatory relief of small businesses. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and government agencies. Most hospices and most other providers and suppliers are small entities, either by nonprofit status or by having revenues of $6 million to $29 million in any 1 year (for details, see the Small Business Administration's regulation at 65 FR 69432, that sets forth size standards for health care industries). For purposes of the RFA, most hospices are small entities. As indicated in Table I below, there are 2,583 hospices. Approximately 70 percent of Medicare certified hospices are identified as voluntary, government, or other agencies and, therefore, are considered small entities. Because the National Hospice and Palliative Care Organization estimates that approximately 79 percent of hospice patients are Medicare beneficiaries, we have not considered other sources of revenue in this analysis. Furthermore, the wage index methodology was previously determined by consensus, through a negotiated rulemaking committee that included representatives of national hospice associations; rural, urban, large, and small hospices; multisite hospices; and consumer groups. Based on all of the options considered, the committee agreed on the methodology described in the committee statement, and it was adopted into regulation in the August 8, 1997 final rule. In developing the process for updating the wage index in the 1997 final rule, we considered the impact of this methodology on small entities and attempted to mitigate any potential negative effects.

As stated previously, the following discussions are limited to demonstrating trends rather than projected dollars. We used the CBSA designations and wage indices as well as the data from FY 2004 claims processed through March 2005 in developing the impact analysis. As indicated above, the impact tables are intended to reflect the effects of the FY 2006 wage index under the CBSA designations. The wage index is the only variable that differs between the FY 2005 payments and the FY 2006 estimated payments. FY 2005 payment rates are used for both FY 2005 actual payments and the FY 2006 estimated payments. The FY 2006 payment rates will be adjusted to reflect the full FY 2006 hospital market basket, as required by section 1814(i)(1)(C)(ii)(VII) of the Act. As previously noted, we publish these rates through administrative issuances. As discussed earlier, hospice agencies may utilize various wage indices to compute their payments based on the geographic location of the beneficiary for routine and continuous home care or the CBSA for the location of the hospice agency for respite and general inpatient care. For this analysis, we use payments to the hospice in the aggregate based on the location of the hospice.

In this final rule our analysis demonstrates that the CBSA wage index before adjustment will decrease estimated payments for FY 2006 slightly by 0.3 percent. Estimated payments for rural hospices are anticipated to experience a 0.2 percent decrease while urban hospices are anticipated to experience a 0.4 percent decrease in estimated payments. Among urban hospices, we expect urban New England to experience the largest decrease of 1.5 percent and urban West South Central to experience the smallest decrease of 0.1 percent. Rural hospices are anticipated to experience either an increase or decrease in estimated payments. Rural Middle Atlantic will experience the largest decrease in estimated payments of 1.6 percent, while the Rural Mountain region will experience the smallest decrease in estimated payments of 0.1 percent. Rural Puerto Rico will experience the largest increase in estimated payments of 2.4 percent while Rural Pacific region will experience the smallest increase in estimated payments of 0.4 percent. Rural East North Central will experience no change in estimated payments.

As discussed previously, we have designated three hospice sizes based on the number of routine home care days. Under the Medicare hospice benefit, hospices can provide four different levels of care days. The majority of the days provided by a hospice are routine home care days. Therefore, the number of routine home care days can be used as a proxy for the size of the hospice, that is, the more days of care provided, the larger the hospice. Using routine home care days as a proxy for size, our analysis indicates that the impact of the wage index update based on the adoption of the CBSA designations (before application of the blend) on all hospice agencies by size is anticipated to decrease slightly for all with medium-sized hospices experiencing the smallest decrease of 0.1 percent and large hospices experiencing the largest decrease of 0.4 percent in anticipated payments.

By type of ownership, the impact on hospice agencies by adopting the CBSA designations (before application of the blend) ranges from the largest decrease of 0.5 percent which is anticipated for voluntary hospices. Government-owned hospices are anticipated to experience no change in estimated payments.

A 1.3 percent decrease is anticipated for skilled nursing facility-based hospices while home health agency-based and hospital-based hospices are expected to experience a 0.4 percent decrease in their estimated payments.

With the implementation of the blended wage index, the impact remains very similar. The impact on all hospices and on urban hospices remains at a 0.3 percent and a 0.4 percent decrease in anticipated payments, respectively. However, rural hospices will experience a 0.1 percent decrease in anticipated payments. Urban hospices will continue to experience a decrease in estimated payments. New England is expected to experience the largest decrease (1.1 percent) while urban West South Central remains unchanged. Rural hospices will continue to experience either an increase or decrease in estimated payments. Rural Middle Atlantic will continue to experience the largest decrease (1.3 percent) while South Atlantic and West North Central remain unchanged. Rural Puerto Rico will continue to experience the greatest increase (1.4 percent) in anticipated payments.

The impact on hospice size as well and on hospice base type remains Start Printed Page 45143unchanged from the nonadjusted impact analysis discussed above.

For type of ownership, voluntary hospices will continue to experience the largest decrease (0.4 percent) while Government-owned hospices will experience a 0.2 decrease in anticipated payments.

We note that there are no unknown facilities in the final rule while there were some in the proposed rule. We believe this can be attributed to a more complete data file that was used for the final rule.

As discussed above, the impact analysis considers anticipated payments only with respect to changes in the wage index values. Payment to hospice providers for FY 2006 is anticipated to increase as a result of the FY 2006 payment rates which will reflect the market basket increase. The FY 2006 payment rates will be promulgated through administrative issuance.

Since payment rates for FY 2006 will increase and since the payment impact on hospice agencies will slightly decrease with the adoption of the CBSA designations, there was no compelling reason to maintain the use of the MSA designations as opposed to the CBSA designations based upon overall hospice agency impact. As discussed, the blended wage index is budget neutral to what we would have paid had the 1983 wage index values remained in effect. In addition, this adjustment is budget neutral with respect to the amount that we anticipate we would pay if an adjustment were not made. For these reasons, as well as the fact that the overall impact on hospice agencies remains unchanged, we are including the adjustments in this final rule.

3. Anticipated Effects

We have compared estimated payments using the FY 1983 hospice wage index to estimated payments using the proposed FY 2006 wage index and determined the current hospice wage index to be budget neutral. This impact analysis compares hospice payments using the FY 2005 hospice wage index to the estimated payments using the proposed FY 2006 wage index. The data used in developing the quantitative analysis for this proposed rule were obtained from the National Claims History file of all FY 2004 claims processed through March 2005. We deleted bills from hospices that have since closed. We believe this file is adequate to demonstrate the impact of using the CBSA designations and to project the anticipated expenditures for FY 2006.

Table I demonstrates the results of our analysis. In column 1 we indicate the number of hospices included in our analysis. In column 2 of Table I, we indicate the number of routine home care days that were included in our analysis, although the analysis was performed on all types of hospice care. Column 3 estimates payments using the FY 2005 wage index. Column 4 estimates payments using CBSA designations and FY 2006 wage index values as well as FY 2005 payment rates. Column 5 compares columns 3 and 4, and shows the percent change in estimated hospice payments made based on the category of the hospice using the unadjusted wage index values. Columns 6 and 7 shows the percent change in estimated hospice payments made based on the category of the hospice using the adjusted wage index values.

Table I categorizes hospices by various geographic and provider characteristics. The first row displays the aggregate result of the impact for all Medicare-certified hospices. The second and third rows of the table categorize hospices according to their geographic location (urban and rural). Note that hospice listings are based on current MSA urban and rural designations. The analysis considers the impact of adopting the CBSA designations in relation to the current MSA designations. Our analysis indicated that there are 1,614 hospices located in urban areas and 969 hospices located in rural areas under current MSA designations. The next two groupings in the table indicate the number of hospices by census region, also broken down by urban and rural hospices. The sixth grouping shows the impact on hospices based on the size of the hospice's program. We determined that the majority of hospice payments are made at the routine home care rate. Therefore, we based the size of each individual hospice's program on the number of routine home care days provided in 2004. The next grouping shows the impact on hospices by type of ownership. The final grouping shows the impact on hospices defined by whether they are provider-based or freestanding.

Our analysis shows that most hospices are in urban areas and provide the vast majority of routine home care days. However, rural hospices are anticipated to experience a slight increase due to the implementation of the CBSA designations, while the urban hospices are anticipated to experience a slight decrease. Since the impact tables are intended to reflect the implementation of the CBSA designation and wage indices, the introduction of the wage indices is the only variable used in the computation. As noted above, the payment rates used reflect the FY2005 rates. The FY 2006 payment rates will be adjusted to reflect the full FY 2006 hospital market basket, as required by section 1814(i)(1)(C) (ii)(VII) of the Act. We publish these rates through administrative issuances.

Table I.—Impact of Hospice Wage Index CBSA Wage Index Values and Blended Adjustment

Number of hospicesNumber of routine home care days (in thousands)Payments using FY 2005 wage index (in thousands)Estimated payments using FY 2006 CBSA wage-index not adjusted (in thousands)Percent change in wage index (not adjusted)Estimated payments using FY 2006 CBSA wage index adjusted (in thousands)Percent change in wage index (adjusted)
By Geographic Location:
All Hospices2,58349,2297,079,5957,055,746−0.37,055,747−0.3
Urban Hospices1,61441,0096,099,6666,073,545−0.46,076,668−0.4
Rural Hospices9698,220979,929982,2010.2979,080−0.1
By Region—Urban:
New England961,298219,049215,693−1.5216,615−1.1
Middle Atlantic1854,123638,629634,691−0.6633,951−0.7
South Atlantic2188,7431,429,8161,425,021−0.31,425,473−0.3
East North Central2556,207910,287905,921−0.5906,835−0.4
Start Printed Page 45144
East South Central1223,065404,841403,001−0.5403,505−0.3
West North Central1192,713352,492351,959−0.2351,992−0.1
West South Central2685,822789,591788,709−0.1789,3940.0
Puerto Rico3050242,49342,158−0.842,333−0.4
By Region—Rural:
New England2823132,19731,859−1.131,853−1.1
Middle Atlantic3730437,13036,518−1.636,650−1.3
South Atlantic1431,616199,714200,7190.5199,8030.0
East North Central140946115,032115,0510.0114,757−0.2
East South Central1211,862210,166209,571−0.3209,035−0.5
West North Central185850106,374106,5110.1106,4200.0
West South Central1391,253136,659139,0191.7137,8460.9
Puerto Rico4846,4726,6262.46,5611.4
Routine Home Care Days:
0-3499 Days (Small)625990125,360125,082−0.2125,078−0.2
3500-19,999 Days (Medium)120911,8911,564,6111,563,054−0.11,562,131−0.2
20,000+ Days (Large)74936,3485,389,6245,367,611−0.45,368,539−0.4
Type of Ownership:
Hospice Base:
Skilled Nursing Facility1417829,12228,734−1.328,762−1.2
Note: For purposes of comparing the CBSA designations with the current MSA designations, hospice listings are based on the MSA designations.
 FY 2005 payment rates were used for estimated payments for FY 2006. FY 2006 payment rates will be adjusted to reflect the full hospital market basket and will be promulgated through administrative issuance.
 Columns 4 & 5 represent the CBSA estimated payments and percent change in wage index had the transition not been implemented. Columns 6 and 7 represent the blended estimated payments and percentage changes in wage index as a result of adopting the new OMB designations (CBSAs).
Start List of Subjects

List of Subjects for 42 CFR Part 418

  • Health facilities
  • Hospice care
  • Medicare
  • Reporting and recordkeeping requirements
End List of Subjects Start Amendment Part

For the reasons stated in the preamble of this final rule, the Centers for Medicare & Medicaid Services is amending 42 CFR part 418 as set forth below:

End Amendment Part Start Part


End Part Start Amendment Part

1. The authority citation for part 418 continues to read as follows:

End Amendment Part Start Authority

Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 1302 and 1395hh).

End Authority Start Amendment Part

2. Section 418.3 is amended by revising the definition of Attending physician to read as follows:

End Amendment Part
* * * * *

Attending physician means a—(1)(i) Doctor of medicine or osteopathy legally authorized to practice medicine and surgery by the State in which he or she performs that function or action; or

(ii) Nurse practitioner who meets the training, education, and experience requirements as the Secretary may prescribe; and

(2) Is identified by the individual, at the time he or she elects to receive hospice care, as having the most significant role in the determination and delivery of the individual's medical care.

* * * * *
Start Amendment Part

3. Section 418.22 is amended by—

End Amendment Part Start Amendment Part

A. Republishing the heading of paragraph (c) and paragraph (c)(1).

End Amendment Part Start Amendment Part

B. Revising paragraph (c)(1)(ii).

End Amendment Part

The republication and revisions read as follows:

Certification of terminal illness.
* * * * *

(c) Sources of certification. (1) For the initial 90-day period, the hospice must obtain written certification statements Start Printed Page 45145(and oral certification statements if required under paragraph (a)(3) of this section) from—

(i) * * *

(ii) The individual's attending physician, if the individual has an attending physician. The attending physician must meet the definition of physician specified in § 410.20 of this subchapter.

* * * * *
Start Amendment Part

4. Section 418.302 is amended by revising paragraph (d) to read as follows:

End Amendment Part
Payment procedures for hospice care.
* * * * *

(d)(1) The intermediary reimburses the hospice its appropriate payment amount for each day for which an eligible Medicare beneficiary is under the hospice's care.

(2) Effective December 8, 2003, if a hospice makes arrangements with another hospice to provide services under the circumstances specified in section 1861(dd)(5)(D) of the Act, the intermediary reimburses the hospice for which the beneficiary has made an election as described in paragraph (d)(1) of this section.

* * * * *
Start Amendment Part

5. Section 418.304 is amended by—

End Amendment Part Start Amendment Part

A. Revising the section heading.

End Amendment Part Start Amendment Part

B. Revising the introductory text of paragraph (a).

End Amendment Part Start Amendment Part

C. Adding a new paragraph (e).

End Amendment Part

The revisions and additions read as follows:

Payment for physician and nurse practitioner services.

(a) The following services performed by hospice physicians and nurse practitioners are included in the rates described in § 418.302:

* * * * *

(e)(1) Effective December 8, 2003, Medicare pays for attending physician services provided by nurse practitioners to Medicare beneficiaries who have elected the hospice benefit and who have selected a nurse practitioner as their attending physician. This applies to nurse practitioners without regard to whether they are hospice employees.

(2) Nurse practitioners may bill and receive payment for services only if the—

(i) Nurse practitioner is the beneficiary's attending physician as defined in § 418.3;

(ii) Services are medically reasonable and necessary;

(iii) Services are performed by a physician in the absence of the nurse practitioner; and

(iv) Services are not related to the certification of terminal illness specified in § 418.22.

(3) Payment for nurse practitioner services are made at 85 percent of the physician fee schedule amount.

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

Start Signature

Dated: July 19, 2005.

Mark B. McClellan,

Administrator, Centers for Medicare & Medicaid Services.

End Signature Start Signature
Approved: July 27, 2005.

Michael O. Leavitt,


End Signature Start Printed Page 45146

Addendum—Table A.—Hospice Wage Index for Urban Areas by CBSA

CBSA codeWage index 1Urban area (constituent counties or county equivalents) 2
10180Abilene, TX
0.8358Callahan, TX*
Jones, TX*
0.8411Taylor, TX*
10380Aguadilla-Isabela-San Sebastian, PR
0.4930Aguada, PR*
Aguadilla, PR*
Moca, PR*
0.4788Isabela, PR*
Lares, PR*
Rincon, PR*
San Sebastian, PR*
0.5203Anasco, PR*
104200.9604Akron, OH Portage, OH Summit, OH
10500Albany, GA
1.1949Dougherty, GA*
Lee, GA*
1.0349Baker, GA*
Terrell, GA*
Worth, GA*
105800.9132Albany-Schenectady-Troy, NY
Albany, NY
Rensselaer, NY
Saratoga, NY
Schenectady, NY
Schoharie, NY
10740Albuquerque, NM
1.1121Bernalillo, NM*
Sandoval, NM*
Valencia, NM*
1.0084Torrance, NM*
10780Alexandria, LA
0.8667Rapides, LA*
0.8335Grant, LA*
10900Allentown-Bethlehem-Easton, PA-NJ
1.0096Carbon, PA*
Lehigh, PA*
Northampton, PA*
1.1203Warren, NJ*
110200.8975Altoona, PA
Blair, PA
11100Amarillo, TX
0.9735Potter, TX*
Randall, TX*
0.9063Armstrong, TX*
Carson, TX*
111800.9562Ames, IA
Story, IA
11260Anchorage, AK
1.2873Anchorage, AK*
1.2623Matanuska-Susitna, AK*
113000.9945Anderson, IN
Madison, IN
113400.9583Anderson, SC
Anderson, SC
114601.1581Ann Arbor, MI
Washtenaw, MI
115000.8359Anniston-Oxford, AL
Calhoun, AL
115400.9676Appleton, WI
Calumet, WI
Outagamie, WI
11700Asheville, NC
0.9913Buncombe, NC*
Madison, NC*
0.9382Haywood, NC*
Henderson, NC*
12020Athens-Clarke County, GA
1.0821Clarke, GA*
Start Printed Page 45147
Madison, GA*
Oconee, GA*
0.9784Oglethorpe, GA*
12060Atlanta-Sandy Springs-Marietta, GA
1.0576Barrow, GA*
Bartow, GA*
Carroll, GA*
Cherokee, GA*
Cobb, GA*
Coweta, GA*
De Kalb, GA*
Douglas, GA*
Fayette, GA*
Forsyth, GA*
Fulton, GA*
Gwinnett, GA*
Henry, GA*
Newton, GA*
Paulding, GA*
Pickens, GA*
Rockdale, GA*
Spalding, GA*
Walton, GA*
0.9662Butts, GA*
Dawson, GA*
Haralson, GA*
Heard, GA*
Jasper, GA*
Lamar, GA*
Meriwether, GA*
Pike, GA*
121001.1581Atlantic City, NJ
Atlantic, NJ
122200.8713Auburn-Opelika, AL
Lee, AL
12260Augusta-Richmond County, GA-SC
0.9738Aiken, SC*
Columbia, GA*
Edgefield, SC*
McDuffie, GA*
Richmond, GA*
0.9228Burke, GA*
124201.0177Austin-Round Rock, TX
Bastrop, TX
Caldwell, TX
Hays, TX
Travis, TX
Williamson, TX
125401.0645Bakersfield, CA
Kern, CA
125801.0508Baltimore-Towson, MD
Anne Arundel, MD
Baltimore, MD
Baltimore City, MD
Carroll, MD
Harford, MD
Howard, MD
Queen Anne's, MD
126201.0559Bangor, ME
Penobscot, ME
127001.3083Barnstable Town, MA
Barnstable, MA
12940Baton Rouge, LA
0.8842Ascension, LA*
East Baton Rouge Parish, LA*
Livingston, LA*
West Baton Rouge Parish, LA*
0.8413East Feliciana, LA*
Iberville, LA*
Pointe Coupee, LA*
Start Printed Page 45148
St. Helena, LA*
West Feliciana, LA*
129801.0456Battle Creek, MI
Calhoun, MI
130201.0219Bay City, MI
Bay, MI
131400.9139Beaumont-Port Arthur, TX
Hardin, TX
Jefferson, TX
Orange, TX
133801.2348Bellingham, WA
Whatcom, WA
134601.0953Bend, OR
Deschutes, OR
136441.1629Bethesda-Gaithersburg-Frederick, MD
Frederick, MD
Montgomery, MD
13740Billings, MT
0.9367Carbon, MT*
0.9505Yellowstone, MT*
137800.8959Binghamton, NY
Broome, NY
Tioga, NY
13820Birmingham-Hoover, AL
0.9734Blount, AL*
Jefferson, AL*
Shelby, AL*
St. Clair, AL*
0.8907Bibb, AL*
Chilton, AL*
Walker, AL*
139000.8000Bismarck, ND
Burleigh, ND
Morton, ND
139800.8713Blacksburg-Christiansburg-Radford, VA
Giles, VA*
Montgomery, VA*
Pulaski, VA*
Radford City, VA*
14020Bloomington, IN
0.9187Greene, IN*
Owen, IN*
0.9108Monroe, IN*
140600.9664Bloomington-Normal, IL
McLean, IL
14260Boise City-Nampa, ID
0.9919Ada, ID*
Canyon, ID*
0.9640Boise, ID*
Gem, ID*
Owyhee, ID*
144841.2230Boston-Quincy, MA
Norfolk, MA
Plymouth, MA
Suffolk, MA
145001.0655Boulder, CO
Boulder, CO
145400.8477Bowling Green, KY
Edmonson, KY
Warren, KY
147401.1258Bremerton-Silverdale, WA
Kitsap, WA
148601.3306Bridgeport-Stamford-Norwalk, CT
Fairfield, CT
151801.0739Brownsville-Harlingen, TX
Cameron, TX
152601.0703Brunswick, GA
Brantley, GA
Glynn, GA
McIntosh, GA
153800.9906Buffalo-Niagara Falls, NY
Start Printed Page 45149
Erie, NY
Niagara, NY
155000.9694Burlington, NC
Alamance, NC
155400.9888Burlington-South Burlington, VT
Chittenden, VT
Franklin, VT
Grand Isle, VT
157641.1921Cambridge-Newton-Framingham, MA
Middlesex, MA
158041.1402Camden, NJ
Burlington, NJ
Camden, NJ
Gloucester, NJ
159400.9435Canton-Massillon, OH
Carroll, OH
Stark, OH
159800.9939Cape Coral-Fort Myers, FL
Lee, FL
161801.0704Carson City, NV
Carson City, NV
162200.9804Casper, WY
Natrona, WY
16300Cedar Rapids, IA
0.9519Linn, IA*
0.9294Benton, IA*
Jones, IA*
6580Champaign-Urbana, IL
1.0105Champaign, IL*
0.9476Ford, IL*
Piatt, IL*
16620Charleston, WV
0.9414Kanawha, WV*
Putnam, WV*
0.8994Boone, WV*
Clay, WV*
Lincoln, WV*
167000.9991Charleston-North Charleston, SC
Berkeley, SC
Charleston, SC
Dorchester, SC
16740Charlotte-Gastonia-Concord, NC-SC
1.0317Cabarrus, NC*
Gaston, NC*
Mecklenburg, NC*
Union, NC*
York, SC*
0.9675Anson, NC*
16820Charlottesville, VA
1.0918Albemarle, VA*
Charlottesville City, VA*
Fluvanna, VA*
Greene, VA*
0.9956Nelson, VA*
16860Chattanooga, TN-GA
0.9766Catoosa, GA*
Dade, GA*
Hamilton, TN*
Marion, TN*
Walker, GA*
0.9060Sequatchie, TN*
169400.9525Cheyenne, WY
Laramie, WY
169741.1518Chicago-Naperville-Joliet, IL
Cook, IL
De Kalb, IL
Du Page, IL
Grundy, IL
Kane, IL
Kendall, IL
McHenry, IL
Start Printed Page 45150
Will, IL
170201.1182Chico, CA
Butte, CA
17140Cincinnati-Middletown, OH-KY-IN
1.0135Boone, KY*
Brown, OH*
Campbell, KY*
Clermont, OH*
Dearborn, IN*
Gallatin, KY*
Grant, KY*
Hamilton, OH*
Kenton, KY*
Ohio, IN*
Pendleton, KY*
Warren, OH*
0.9680Franklin, IN*
0.9207Bracken, KY*
0.9855Butler, OH*
17300Clarksville, TN-KY
0.8509Christian, KY*
Montgomery, TN*
0.8431Stewart, TN*
0.8414Trigg, KY*
174200.8337Cleveland, TN
Bradley, TN
Polk, TN
174601.0223Cleveland-Elyria-Mentor, OH
Cuyahoga, OH
Geauga, OH
Lake, OH
Lorain, OH
Medina, OH
176600.9634Coeur d'Alene, ID
Kootenai, ID
17780College Station-Bryan, TX
0.9804Brazos, TX*
0.9097Burleson, TX*
Robertson, TX*
17820Colorado Springs, CO
1.0386El Paso, C*O
1.0161Teller, CO*
17860Columbia, MO
0.8905Boone, MO*
0.8605Howard, MO*
17900Columbia, SC
0.9993Lexington, SC*
Richland, SC*
0.9563Calhoun, SC*
Fairfield, SC*
Kershaw, SC*
Saluda, SC*
17980Columbus, GA-AL
0.9217Chattahoochee, GA*
Harris, GA*
Muscogee, GA*
Russell, AL
0.8982Marion, GA*
180200.9612Columbus, IN
Bartholomew, IN*
18140Columbus, OH
1.0336Delaware, OH*
Fairfield, OH*
Franklin, OH*
Licking, OH*
Madison, OH*
Pickaway, OH*
0.9809Morrow, OH*
Union, OH*
18580Corpus Christi, TX
0.9172Nueces, TX*
Start Printed Page 45151
San Patricio, TX*
0.8781Aransas, TX*
187001.1185Corvallis, OR
Benton, OR
190600.9187Cumberland, MD-WV
Allegany, MD
Mineral, WV
19124Dallas-Plano-Irving, TX
1.0675Collin, TX*
Dallas, TX*
Denton, TX*
Ellis, TX*
Hunt, TX*
Kaufman, TX*
Rockwall, TX*
0.9538Delta, TX*
191400.9443Dalton, GA
Murray, GA
Whitfield, GA
191800.8874Danville, IL
Vermilion, IL
192600.9167Danville, VA
Danville City, VA
Pittsylvania, VA
19340Davenport-Moline-Rock Island, IA-IL
0.9305Henry, IL*
0.9076Rock Island, IL*
Scott, IA*
Mercer, IL*
19380Dayton, OH
0.9829Greene, OH*
0.9579Miami, OH*
Montgomery, OH*
Preble, OH*
194600.9434Decatur, AL
Lawrence, AL
Morgan, AL
195000.8615Decatur, IL
Macon, IL
196600.9439Deltona-Daytona Beach-Ormond Beach, FL
Volusia, FL
19740Denver-Aurora, CO
1.1565Adams, CO*
Arapahoe, CO*
Broomfield, CO*
Denver, CO*
Douglas, CO*
Jefferson, CO*
1.0751Clear Creek, CO*
Elbert, CO*
Gilpin, CO*
Park, CO*
19780Des Moines, IA*
0.9828Dallas, IA*
Polk, IA*
Warren, IA*
0.9449Guthrie, IA*
lMadison, IA*
198041.0912Detroit-Livonia-Dearborn, MI
Wayne, MI
20020Dothan, AL
0.8049Geneva, AL*
Henry, AL*
0.8027Houston, AL*
201001.0421Dover, DE
Kent, DE
202200.9279Dubuque, IA
Dubuque, IA
20260Duluth, MN-WI
1.0976Douglas, WI*
St. Louis, MN*
Start Printed Page 45152
1.0437Carlton, MN*
20500Durham, NC
1.0936Chatham, NC*
Durham, NC*
Orange, NC*
1.0004Person, NC*
207400.9693Eau Claire, WI
Chippewa, WI
Eau Claire, WI
20764Edison, NJ
1.1930Middlesex, NJ*
Somerset, NJ*
1.1680Monmouth, NJ*
Ocean, NJ*
209401.0157El Centro, CA
Imperial, CA
210600.8765Elizabethtown, KY
Hardin, KY
Larue, KY
211400.9841Elkhart-Goshen, IN
Elkhart, IN
213000.8957Elmira, NY
Chemung, NY
213400.9738El Paso, TX
El Paso, TX
215000.9227Erie, PA
Erie, PA
216041.1642Essex County, MA
Essex, MA
216601.1604Eugene-Springfield, OR
Lane, OR
21780Evansville, IN-KY
0.9073Gibson, IN*
0.8892Henderson, KY*
Posey, IN*
Vanderburgh, IN*
Warrick, IN*
0.8600Webster, KY*
218201.2082Fairbanks, AK
Fairbanks North Star, AK
219400.5026Fajardo, PR
Ceiba, PR
Fajardo, PR
Luquillo, PR
220200.9667Fargo, ND-MN
Cass, ND
Clay, MN
221400.8792Farmington, NM
San Juan, NM
22180Fayetteville, NC
0.9931Cumberland, NC*
0.9473Hoke, NC*
22220Fayetteville-Springdale-Rogers, AR-MO
0.9160Benton, AR*
Washington, AR*
0.8665Madison, AR*
0.8732McDonald, MO*
223801.1348Flagstaff, AZ
Coconino, AZ
224201.1856Flint, MI
Genesee, MI
22500Florence, SC*
0.9267Darlington, SC*
0.9436Florence, SC
225200.8361Florence-Muscle Shoals, AL
Colbert, AL
Lauderdale, AL
225401.0286Fond Du Lac, WI
Fond Du Lac, WI
226601.0838Fort Collins-Loveland, CO
Larimer, CO
Start Printed Page 45153
227441.0782Ft Lauderdale-Pompano Beach-Deerfield Beach, FL
Broward, FL
22900Fort Smith, AR-OK
0.8796Crawford, AR*
Sebastian, AR*
Sequoyah, OK*
0.8478Franklin, AR*
0.8394Le Flore, OK*
230200.9319Fort Walton Beach-Crestview-Destin, FL
Okaloosa, FL
230601.0365Fort Wayne, IN
Allen, IN
Wells, IN
Whitley, IN
23104Fort Worth-Arlington, TX
1.0072Johnson, TX*
Parker, TX*
Tarrant, TX*
0.9218Wise, TX*
234201.1107Fresno, CA
Fresno, CA
234600.8537Gadsden, AL
Etowah, AL
23540Gainesville, FL
0.9642Alachua, FL
1.0033Gilchrist, FL
235800.9442Gainesville, GA
Hall, GA
23844Gary, IN
0.9892Lake, IN*
Porter, IN*
0.9570Jasper, IN*
Newton, IN*
240200.8981Glens Falls, NY
Warren, NY
Washington, NY
241400.9311Goldsboro, NC
Wayne, NC
242200.9642Grand Forks, ND-MN
Grand Forks, ND
Polk, MN
243001.0501Grand Junction, CO
Mesa, CO
24340Grand Rapids-Wyoming, MI
1.0044Kent, MI*
0.9631Barry, MI*
Ionia, MI*
Newaygo, MI*
245000.9344Great Falls, MT
Cascade, MT
245401.0017Greeley, CO
Weld, CO
24580Green Bay, WI
1.0170Brown, WI*
1.0123Kewaunee, WI*
Oconto, WI*
24660Greensboro-High Point, NC
0.9812Guilford, NC*
0.9382Randolph, NC*
Rockingham, NC*
24780Greenville, NC
0.9740Pitt, NC*
0.9378Greene, NC*
24860Greenville, SC
1.0054Greenville, SC*
Pickens, SC*
0.9651Laurens, SC*
250200.4630Guayama, PR
Arroyo, PR
Guayama, PR
Patillas, PR
Start Printed Page 45154
25060Gulfport-Biloxi, MS
0.9333Hancock, MS*
Harrison, MS*
0.8768Stone, MS*
25180Hagerstown-Martinsburg, MD-WV
1.0424Washington, MD*
0.9439Morgan, WV*
1.0970Berkeley, WV*
252601.0391Hanford-Corcoran, CA
Kings, CA
254200.9888Harrisburg-Carlisle, PA
Cumberland, PA
Dauphin, PA
Perry, PA
255000.9416Harrisonburg, VA
Harrisonburg City, VA
Rockingham, VA
255401.1725Hartford-West Hartford-East Hartford, CT
Hartford, CT
Litchfield, CT
Middlesex, CT
Tolland, CT
25620Hattiesburg, MS
0.8000Forrest, MS*
Lamar, MS*
0.8020Perry, MS*
258601.0078Hickory-Lenoir-Morganton, NC
Alexander, NC
Burke, NC
Caldwell, NC
Catawba, NC
259800.8465Hinesville-Fort Stewart, GA
Liberty, GA
Long, GA
261001.0027Holland-Grand Haven, MI
Ottawa, MI
261801.1681Honolulu, HI
Honolulu, HI
263000.8990Hot Springs, AR
Garland, AR
263800.8189Houma-Bayou Cane-Thibodaux, LA
Lafourche, LA
Terrebonne, LA
26420Houston-Sugar Land-Baytown, TX
1.0654Chambers, TX*
Fort Bend, TX*
Harris, TX*
Liberty, TX*
Montgomery, TX*
Waller, TX*
0.9484Austin, TX*
San Jacinto, TX*
0.9810Brazoria, TX*
1.0276Galveston, TX*
265801.0144Huntington-Ashland, WV-KY-OH
Boyd, KY
Cabell, WV
Greenup, KY
Lawrence, OH
Wayne, WV
266200.9388Huntsville, AL
Limestone, AL
Madison, AL
268200.9485Idaho Falls, ID
Bonneville, ID
Jefferson, ID
26900Indianapolis, IN
1.0687Boone, IN*
Hamilton, IN*
Hancock, IN*
Hendricks, IN*
Start Printed Page 45155
Johnson, IN*
Marion, IN*
Morgan, IN*
Shelby, IN*
0.9996Brown, IN*
Putnam, IN*
26980Iowa City, IA
1.0240Johnson, IA*
0.9654Washington, IA*
270600.9542Ithaca, NY
Tompkins, NY
271000.9701Jackson, MI
Jackson, MI
27140Jackson, MS
0.8855Hinds, MS*
Madison, MS*
Rankin, MS*
0.8419Copiah, MS*
Simpson, MS*
271800.9440Jackson, TN
Chester, TN
Madison, TN
27260Jacksonville, FL
1.0121Clay, FL*
Duval, FL*
Nassau, FL*
St. johns, FL*
0.9683Baker, FL*
273400.8911Jacksonville, NC
Onslow, NC
275001.0164Janesville, WI
Rock, WI
276200.8574Jefferson City, MO
Callaway, MO
Cole, MO
Moniteau, MO
Osage, MO
277400.8670Johnson City, TN
Carter, TN
Unicoi, TN
Washington, TN
277800.8676Johnstown, PA
Cambria, PA
27860Jonesboro, AR
0.8638Craighead, AR*
0.8404Poinsett, AR*
279000.9250Joplin, MO
Jasper, MO
Newton, MO
280201.1151Kalamazoo-Portage, MI
Kalamazoo, MI
Van Buren, MI
281001.1246Kankakee-Bradley, IL
Kankakee, IL
28140Kansas City, MO-KS
1.0219Cass, MO*
Clay, MO*
Clinton, MO*
Jackson, MO*
Johnson, KS*
Lafayette, MO*
Leavenworth, KS*
Miami, KS*
Platte, MO*
Ray, MO*
Wyandotte, KS*
0.9396Franklin, KS*
Linn, KS*
0.9259Bates, MO*
Caldwell, MO*
284201.1158Kennewick-Richland-Pasco, WA
Start Printed Page 45156
Benton, WA
Franklin, WA
28660Killeen-Temple-Fort Hood, TX
0.9803Bell, TX*
Coryell, TX*
0.9096Lampasas, TX*
287000.8720Kingsport-Bristol-Bristol, TN-VA
Bristol city, VA
Hawkins, TN
Scott, VA
Sullivan, TN
Washington, VA
287400.9229Kingston, NY
Ulster, NY
289400.9045Knoxville, TN
Anderson, TN
Blount, TN
Knox, TN
Loudon, TN
Union, TN
290200.9531Kokomo, IN
Howard, IN
Tipton, IN
291000.9853La Crosse, WI-MN
Houston, MN
La Crosse, WI
29140Lafayette, IN
0.9442Benton, IN*
Carroll, IN*
0.9617Tippecanoe, IN*
291800.8703Lafayette, LA
Lafayette, LA
St. Martin, LA
29340Lake Charles, LA
0.8436Calcasieu, LA*
0.8209Cameron, LA*
29404Lake County-Kenosha County, IL-WI
1.1239Lake, IL*
1.0667Kenosha, WI*
294600.9472Lakeland, FL
Polk, FL
295401.0483Lancaster, PA
Lancaster, PA
296201.0244Lansing-East Lansing, MI
Clinton, MI
Eaton, MI
Ingham, MI
297000.9278Laredo, TX
Webb, TX
297400.9317Las Cruces, NM
Dona Ana, NM
298201.1932Las Vegas-Paradise, NV
Clark, NV
299400.9168Lawrence, KS
Douglas, KS
300200.8710Lawton, OK
Comanche, OK
301400.9469Lebanon, PA
Lebanon, PA
30300Lewiston, ID-WA
0.9620Nez Perce, ID*
1.0281Asotin, WA*
303401.0142Lewiston-Auburn, ME
Androscoggin, ME
304600.9853Lexington-Fayette, KY
Bourbon, KY
Clark, KY
Fayette, KY
Jessamine, KY
Scott, KY
Woodford, KY
Start Printed Page 45157
306200.9858Lima, OH
Allen, OH
30700Lincoln, NE
1.0827Lancaster, NE*
1.0205Seward, NE*
30780Little Rock-North Little Rock, AR
0.9361Faulkner, AR*
Lonoke, AR*
Pulaski, AR*
Saline, AR*
0.8766Grant, AR*
Perry, AR*
30860Logan, UT-ID
0.9513Cache, UT*
0.9504Franklin, ID*
30980Longview, TX
0.9302Gregg, TX*
Upshur, TX*
0.8863Rusk, TX*
310201.0764Longview, WA
Cowlitz, WA
310841.2444Los Angeles-Long Beach-Santa Ana, CA
Los Angeles, CA
31140Louisville, KY-IN
0.9697Bullitt, KY*
Clark, IN*
Floyd, IN*
Harrison, IN*
Jefferson, KY*
Oldham, KY*
0.9471Washington, IN*
0.8998Henry, KY*
Meade, KY*
Nelson, KY*
Shelby, KY*
Spencer, KY*
Trimble, KY*
31180Lubbock, TX
0.9309Lubbock, TX*
0.8850Crosby, TX**
31340Lynchburg, VA
0.9564Amherst, VA*
Bedford, VA*
Bedford City, VA*
Campbell, VA*
Lynchburg City, VA*
0.9279Appomattox, VA*
31420Macon, GA
1.0333Bibb, GA*
Jones, GA*
Twiggs, GA*
0.9617Crawford, GA*
Monroe, GA*
314601.0038Madera, CA
Madera, CA
31540Madison, WI
1.0978Dane, WI*
1.0503Columbia, WI*
Iowa, WI*
317001.1631Manchester-Nashua, NH
Hillsborough, NH
Merrimack, NH
319000.9702Mansfield, OH
Richland, OH
324200.5326Mayaguez, PR
Hormigueros, PR
Mayaguez, PR
325800.9124McAllen-Edinburg-Mission, TX
Hidalgo, TX
327801.1173Medford, OR
Jackson, OR
Start Printed Page 45158
32820Memphis, TN-MS-AR
0.9785Crittenden, AR*
DeSoto, MS*
Fayette, TN*
Shelby, TN*
Tipton, TN*
0.8910Marshall, MS*
Tate, MS*
Tunica, MS*
329001.1217Merced, CA
Merced, CA
331241.0469Miami-Miami Beach-Kendall, FL
Miami-Dade, FL
331400.9582Michigan City-La Porte, IN
La Porte, IN
332601.0085Midland, TX
Midland, TX
333401.0687Milwaukee-Waukesha-West Allis, WI
Milwaukee, WI
Ozaukee, WI
Washington, WI
Waukesha, WI
334601.1737Minneapolis-St. Paul-Bloomington, MN-WI
Anoka, MN
Carver, MN
Chisago, MN
Dakota, MN
Hennepin, MN
Isanti, MN
Pierce, WI
Ramsey, MN
Scott, MN
Sherburne, MN
St. Croix, WI
Washington, MN
Wright, MN
335401.0201Missoula, MT
Missoula, MT
336600.8447Mobile, AL
Mobile, AL
337001.2692Modesto, CA
Stanislaus, CA
33740Monroe, LA
0.8388Ouachita, LA*
0.8192Union, LA*
337801.0465Monroe, MI
Monroe, MI
33860Montgomery, AL
0.8804Autauga, AL*
Elmore, AL*
Montgomery, AL*
0.8452Lowndes, AL*
340600.8917Morgantown, WV
Monongalia, WV
Preston, WV
341000.8308Morristown, TN
Grainger, TN
Hamblen, TN
Jefferson, TN
345801.0950Mount Vernon-Anacortes, WA
Skagit, WA
346200.9100Muncie, IN
Delaware, IN
347401.0214Muskegon-Norton Shores, MI
Muskegon, MI
348200.9569Myrtle Beach-Conway-North Myrtle Beach, SC
Horry, SC
349001.3814Napa, CA
Napa, CA
349401.1198Naples-Marco Island, FL
Collier, FL
Start Printed Page 45159
34980Nashville-Davidson-Murfreesboro, TN
1.0710Cheatham, TN*
Davidson, TN*
Dickson, TN*
Robertson, TN*
Rutherford, TN*
Sumner, TN*
Williamson, TN*
Wilson, TN*
0.9526Cannon, TN*
Hickman, TN*
Macon, TN*
Smith, TN*
Trousdale, TN*
350041.3690Nassau-Suffolk, NY
Nassau, NY
Suffolk, NY
35084Newark-Union, NJ-PA
1.2122Pike, PA
1.2363Essex, NJ
Morris, NJ
Sussex, NJ
Union, NJ
1.2223Hunterdon, NJ
353001.2760New Haven-Milford, CT
New Haven, CT
353800.9655New Orleans-Metairie-Kenner, LA
Jefferson, LA
Orleans, LA
Plaquemines, LA
St. Bernard, LA
St. Charles, LA
St. John Baptist, LA
St. Tammany, LA
35644New York-White Plains-Wayne, NY-NJ
1.4264Bronx, NY*
Kings, NY*
New York, NY*
Putnam, NY*
Queens, NY*
Richmond, NY*
Rockland, NY*
Westchester, NY*
1.3406Bergen, NJ*
Passaic, NJ*
1.2852Hudson, NJ*
356600.9384Niles-Benton Harbor, MI
Berrien, MI
359801.2299Norwich-New London, CT
New London, CT
360841.6143Oakland-Fremont-Hayward, CA
Alameda, CA
Contra Costa, CA
361000.9708Ocala, FL
Marion, FL
361401.1517Ocean City, NJ
Cape May, NJ
362201.0304Odessa, TX
Ector, TX
36260Ogden-Clearfield, UT
0.9919Davis, UT*
Weber, UT*
0.9577Morgan, UT*
36420Oklahoma City, OK
0.9518Canadian, OK*
Cleveland, OK*
Logan, OK*
McClain, OK*
Oklahoma, OK*
0.8765Grady, OK*
Lincoln, OK*
Start Printed Page 45160
365001.1674Olympia, WA
Thurston, WA
36540Omaha-Council Bluffs, NE-IA
1.0346Cass, NE*
Douglas, NE*
Pottawattamie, IA*
Sarpy, NE*
Washington, NE*
0.9707Harrison, IA*
Mills, IA*
0.9965Saunders, NE*
367401.0333Orlando-Kissimmee, FL
Lake, FL
Orange, FL
Osceola, FL
Seminole, FL
367800.9659Oshkosh-Neenah, WI
Winnebago, WI
36980Owensboro, KY
0.8946Daviess, KY*
0.8633Hancock, KY*
Mc Lean, KY*
371001.1779Oxnard-Thousand Oaks-Ventura, CA
Ventura, CA
373401.0217Palm Bay-Melbourne-Titusville, FL
Brevard, FL
374600.8617Panama City-Lynn Haven, FL
Bay, FL
37620Parkersburg-Marietta-Vienna, WV-OH
0.8682Pleasants, WV*
Wirt, WV*
0.8791Washington, OH*
Wood, WV*
37700Pascagoula, MS
0.8250George, MS*
0.8816Jackson, MS*
378600.8810Pensacola-Ferry Pass-Brent, FL
Escambia, FL
Santa Rosa, FL
37900Peoria, IL
0.9425Peoria, IL*
Tazewell, IL*
Woodford, IL*
0.9136Marshall, IL*
Stark, IL*
379641.1502Philadelphia, PA
Bucks, PA
Chester, PA
Delaware, PA
Montgomery, PA
Philadelphia, PA
380601.0588Phoenix-Mesa-Scottsdale, AZ
Maricopa, AZ
Pinal, AZ
38220Pine Bluff, AR
0.9199Jefferson, AR*
0.8685Cleveland, AR*
Lincoln, AR*
38300Pittsburgh, PA
0.9277Allegheny, PA*
Beaver, PA*
Butler, PA*
Fayette, PA*
Washington, PA*
Westmoreland, PA*
0.9060Armstrong, PA*
383401.1072Pittsfield, MA
Berkshire, MA
1.0183Pocatello, ID
0.9773Bannock, ID*
Power, ID*
Start Printed Page 45161
386600.5727Ponce, PR
Juana Diaz, PR
Ponce, PR
Villalba, PR
388601.0725Portland-South Portland-Biddeford, ME
Cumberland, ME
Sagadahoc, ME
York, ME
38900Portland-Vancouver-Beaverton, OR-WA
1.2095Clackamas, OR*
Clark, WA*
Columbia, OR*
Multnomah, OR*
Washington, OR*
Yamhill, OR*
1.1389Skamania, WA*
389401.0655Port St. Lucie-Fort Pierce, FL
Martin, FL
St. Lucie, FL
39100Poughkeepsie-Newburgh-Middletown, NY
1.2208Dutchess, NY*
1.1950Orange, NY*
391401.0093Prescott, AZ
Yavapai, AZ
39300Providence-New Bedford-Fall River, RI-MA
1.1783Bristol, MA*
1.1662Bristol, RI*
Kent, RI*
Newport, RI*
Providence, RI*
Washington, RI*
39340Provo-Orem, UT
1.0183Utah, UT*
0.9775Juab, UT*
393800.9283Pueblo, CO
Pueblo, CO
394601.0014Punta Gorda, FL
Charlotte, FL
395400.9594Racine, WI
Racine, WI
395801.0774Raleigh-Cary, NC
Franklin, NC
Johnston, NC
Wake, NC
39660Rapid City, SD
0.9453Pennington, SD*
0.9177Meade, SD*
397400.9774Reading, PA
Berks, PA
398201.2553Redding, CA
Shasta, CA
39900Reno-Sparks, NV
1.1090Washoe, NV*
1.0759Storey, NV*
40060Richmond, VA
0.9967Charles City, VA*
Chesterfield, VA*
Colonial Heights City, VA*
Dinwiddie, VA*
Goochland, VA*
Hanover, VA*
Henrico, VA*
Hopewell City, VA*
New Kent, VA*
Petersburg City, VA*
Powhatan, VA*
Prince George, VA*
Richmond City, VA*
0.9480Amelia, VA*
Caroline, VA*
Cumberland, VA*
Start Printed Page 45162
King and Queen, VA*
King William, VA*
Louisa, VA*
Sussex, VA*
401401.1635Riverside-San Bernardino-Ontario, CA
Riverside, CA
San Bernardino, CA
40220Roanoke, VA
0.8959Craig, VA*
Franklin, VA*
0.8932Botetourt, VA*
Roanoke, VA*
Roanoke City, VA*
Salem City, VA*
40340Rochester, MN
1.2202Olmsted, MN*
1.1054Dodge, MN*
Wabasha, MN*
403800.9799Rochester, NY
Livingston, NY
Monroe, NY
Ontario, NY
Orleans, NY
Wayne, NY
404201.0210Rockford, IL
Boone, IL
Winnebago, IL
404841.1408Rockingham County, NH
Rockingham, NH
Strafford, NH
405800.9544Rocky Mount, NC
Edgecombe, NC
Nash, NC
406600.9082Rome, GA
Floyd, GA
40900Sacramento-Arden-Arcade-Roseville, CA
1.2488El Dorado, CA*
Placer, CA*
Sacramento, CA*
1.1179Yolo, CA*
409801.0347Saginaw-Saginaw Township North, MI
Saginaw, MI
410601.0835St. Cloud, MN
Benton, MN
Stearns, MN
411000.9706St. George, UT
Washington, UT
41140St. Joseph, MO-KS
1.0620Andrew, MO*
Buchanan, MO*
0.9599Doniphan, KS*
0.9463De Kalb, MO*
41180St. Louis, MO-IL
0.9629Clinton, IL*
Franklin, MO*
Jefferson, MO*
Jersey, IL*
Lincoln, MO*
Madison, IL*
Monroe, IL*
St. Charles, MO*
St. Clair, IL*
St. Louis, MO*
St. Louis City, MO*
Warren, MO*
0.9236Bond, IL*
Calhoun, IL*
Macoupin, IL*
0.8965Crawford, MO*
Washington, MO*
414201.1196Salem, OR
Start Printed Page 45163
Marion, OR
Polk, OR
415001.4662Salinas, CA
Monterey, CA
415400.9706Salisbury, MD
Somerset, MD
Wicomico, MD
41620Salt Lake City, UT
1.0102Salt Lake, UT*
0.9760Summit, UT*
Tooele, UT*
41660San Angelo, TX
0.8526Irion, TX*
0.8662Tom Green, TX*
41700San Antonio, TX
0.9560Bexar, TX*
Comal, TX*
Guadalupe, TX*
Wilson, TX*
0.8970Atascosa, TX*
Bandera, TX*
Kendall, TX*
Medina, TX*
417401.1950San Diego-Carlsbad-San Marcos, CA
San Diego, CA
417800.9427Sandusky, OH
Erie, OH
418841.5604San Francisco-San Mateo-Redwood City, CA
Marin, CA
San Francisco, CA
San Mateo, CA
41900San German-Cabo Rojo, PR
0.5340Lajas, PR*
0.5755Cabo Rojo, PR*
Sabana Grande, PR*
San German, PR*
41940San Jose-Sunnyvale-Santa Clara, CA
1.5627Santa Clara, CA*
1.3269San Benito, CA*
41980San Juan-Caguas-Guaynabo, PR
0.5432Aguas Buenas, PR*
Barceloneta, PR*
Bayamon, PR*
Canovanas, PR*
Carolina, PR*
Catano, PR*
Comerio, PR*
Corozal, PR*
Dorado, PR*
Florida, PR*
Guaynabo, PR*
Humacao, PR*
Juncos, PR*
Las Piedras, PR*
Loiza, PR*
Maguabo, PR*
Manati, PR*
Morovis, PR*
Naranjito, PR*
Rio Grande, PR*
San Juan, PR*
Toa Alta, PR*
Toa Baja, PR*
Trujillo Alto, PR*
Vega Alta, PR*
Vega Baja, PR*
Yabucoa, PR*
0.4998Aibonito, PR*
Barranquitas, PR*
Ciales, PR*
Maunabo, PR*
Start Printed Page 45164
Orocovs, PR*
Quebradillas, PR*
0.4831Arecibo, PR*
Camuy, PR*
Hatillo, PR*
0.5006Caguas, PR*
Cayey, PR*
Cidra, PR*
Gurabo, PR*
San Lorenzo, PR*
420201.1792San Luis Obispo-Paso Robles, CA
San Luis Obispo, CA
420441.2315Santa Ana-Anaheim-Irvine, CA
Orange, CA
420601.1424Santa Barbara-Santa Maria, CA
Santa Barbara, CA
421001.5676Santa Cruz-Watsonville, CA
Santa Cruz, CA
421401.1402Santa Fe, NM
Santa Fe, NM
422201.3747Santa Rosa-Petaluma, CA
Sonoma, CA
422601.0213Sarasota-Bradenton-Venice, FL
Manatee, FL
Sarasota, FL
423401.0034Savannah, GA
Bryan, GA
Chatham, GA
Effingham, GA
425400.9050Scranton-Wilkes-Barre, PA
Lackawanna, PA
Luzerne, PA
Wyoming, PA
426441.2182Seattle-Bellevue-Everett, WA
King, WA
Snohomish, WA
431000.9491Sheboygan, WI
Sheboygan, WI
433001.0200Sherman-Denison, TX
Grayson, TX
43340Shreveport-Bossier City, LA
0.9675Bossier, LA*
Caddo, LA*
0.8844De Soto, LA*
43580Sioux City, IA-NE-SD
0.9602Dixon, NE*
0.9633Dakota, NE*
Woodbury, IA*
0.9261Union, SD*
43620Sioux Falls, SD
1.0014Lincoln, SD*
Minnehaha, SD*
0.9458McCook, SD*
Turner, SD*
43780South Bend-Mishawaka, IN-MI
1.0020St. Joseph, IN*
0.9645Cass, MI*
439001.0033Spartanburg, SC
Spartanburg, SC
440601.1307Spokane, WA
Spokane, WA
441000.9268Springfield, IL
Menard, IL
Sangamon, IL
44140Springfield, MA
1.0815Franklin, MA*
1.0792Hampden, MA*
Hampshire, MA*
44180Springfield, MO
0.9097Christian, MO*
Greene, MO*
Start Printed Page 45165
Webster, MO*
0.8690Dallas, MO*
Polk, MO*
442200.9535Springfield, OH
Clark, OH
443000.8974State College, PA
Centre, PA
447001.1205Stockton, CA
San Joaquin, CA
449400.9037Sumter, SC
Sumter, SC
450601.0003Syracuse, NY
Madison, NY
Onondaga, NY
Oswego, NY
451041.1750Tacoma, WA
Pierce, WA
45220Tallahassee, FL
0.9180Gadsden, FL*
Leon, FL*
0.9215Wakulla, FL*
Jefferson, FL*
453000.9571Tampa-St. Petersburg-Clearwater, FL
Hernando, FL
Hillsborough, FL
Pasco, FL
Pinellas, FL
45460Terre Haute, IN
0.9068Clay, IN*
Vermillion, IN*
Vigo, IN*
0.9150Sullivan, IN*
455000.8923Texarkana, TX-Texarkana, AR
Bowie, TX
Miller, AR
45780Toledo, OH
1.0102Fulton, OH*
Lucas, OH*
Wood, OH*
0.9696Ottawa, OH*
45820Topeka, KS
0.9444Shawnee, KS*
0.9011Jackson, KS*
Jefferson, KS*
Osage, KS*
Wabaunsee, KS*
459401.0899Trenton-Ewing, NJ
Mercer, NJ
460600.9467Tucson, AZ
Pima County, AZ
46140Tulsa, OK
0.9238Creek, OK*
Osage, OK*
Rogers, OK*
Tulsa, OK*
Wagoner, OK*
0.8610Okmulgee, OK*
Pawnee, OK*
46220Tuscaloosa, AL
0.8897Tuscaloosa, AL*
0.8471Greene, AL*
Hale, AL*
463401.0078Tyler, TX
Smith, TX
465400.8798Utica-Rome, NY
Herkimer, NY
Oneida, NY
466600.8797Valdosta, GA
Brooks, GA
Echols, GA
Lanier, GA
Start Printed Page 45166
Lowndes, GA
467001.4741Vallejo-Fairfield, CA
Solano, CA
469400.9651Vero Beach, FL
Indian River, FL
47020Victoria, TX
0.8983Victoria, TX*
0.8687Calhoun, TX*
Goliad, TX*
472201.1214Vineland-Millville-Bridgeton, NJ
Cumberland, NJ
47260Virginia Beach-Norfolk-Newport News, VA
0.9434Chesapeake City, VA*
Currituck, NC*
Gloucester, VA*
Hampton City, VA*
Isle of Wight, VA*
James City, VA*
Mathews, VA*
Newport News City, VA*
Norfolk City, VA*
Poquoson, VA*
Portsmouth City, VA*
Suffolk City, VA*
Virginia Beach City, VA*
Williamsburg City, VA*
York, VA*
0.9214Surry, VA*
473001.0580Visalia-Porterville, CA
Tulare, CA
473800.8640Waco, TX
McLennan, TX
475800.9591Warner Robins, GA
Houston, GA
47644Warren-Farmington-Hills-Troy, MI
1.0786Lapeer, MI*
Macomb, MI*
Oakland, MI*
St. Clair, MI*
1.1099Livingston, MI*
478941.1664Washington-Arlington-Alexandria, DC-VA-MD-WV
Alexandria City, VA
Arlington, VA
Calvert, MD
Charles, MD
Clarke, VA
Fairfax, VA
Fairfax City, VA
Falls Church City, VA
Fauquier, VA
Fredericksburg City, VA
Jefferson, WV
Loudoun, VA
Manassas City, VA
Manassas Park city, VA
Prince Georges, MD
Prince William, VA
Spotsylvania, VA
Stafford, VA
District of Columbia, DC
Warren, VA
47940Waterloo-Cedar Falls, IA
0.9157Black Hawk, IA
0.9113Bremer, IA
Grundy, IA
481401.0151Wausau, WI
Marathon, WI
482600.8782Weirton-Steubenville, WV-OH
Brooke, WV
Hancock, WV
Jefferson, OH
Start Printed Page 45167
483001.0341Wenatchee, WA
Chelan, WA
Douglas, WA
484241.0991West Palm Beach-Boca Raton-Boynton FL
Palm Beach, FL
485400.8000Wheeling, WV-OH
Belmont, OH
Marshall, WV
Ohio, WV
48620Wichita, KS
1.0046Butler, KS*
Harvey, KS*
Sedgwick, KS*
0.9304Sumner, KS*
48660Wichita Falls, TX
0.8871Archer, TX*
Wichita, TX*
0.8614Clay, TX*
487000.9000Williamsport, PA
Lycoming, PA
48864Wilmington, DE-MD-NJ
1.1757Cecil, MD
New Castle, DE
1.1600Salem, NJ
48900Wilmington, NC
0.9797Brunswick, NC*
New Hanover, NC*
0.9407Pender, NC*
49020Winchester, VA-WV
1.0063Frederick, VA*
Winchester City, VA*
0.9853Hampshire, WV*
491800.9924Winston-Salem, NC
Davie, NC
Forsyth, NC
Stokes, NC
Yadkin, NC
493401.1819Worcester, MA
Worcester, MA
494201.0948Yakima, WA
Yakima, WA
49500Yauco, PR
0.4911Guanica, PR*
0.5432Guayanilla, PR*
Penuelas, PR*
Yauco, PR*
496200.9705York-Hanover, PA
York, PA
49660Youngstown-Warren-Boardman, OH-PA
0.9946Mahoning, OH*
Trumbull, OH*
0.9078Mercer, PA*
497001.0992Yuba City, CA
Sutter, CA
Yuba, CA
497400.9409Yuma, AZ
Yuma, AZ
* Wage index values for these counties have a designated code to be used for claims processing purposes. These counties are referred to Table C of this regulation. To derive the blended wage index values, the budget neutrality adjustment factors of 1.060339 and 1.060988 have been applied to the MSA and the CBSA hospital wage data, respectively.
1 Wage index values are based on FY 2001 hospital cost report data before reclassification. This wage index is further adjusted. Wage index values greater than 0.8 are subject to a budget neutrality adjustment. Wage index values below 0.8 are adjusted to be the greater of a 15-percent increase, subject to a maximum wage index value of 0.8, or a budget neutrality adjustment calculated by multiplying the hospital wage index value for a given area by the budget neutrality factor. We have completed all of these adjustments and included them in the wage index values reflected in this table.
2 This column lists each CBSA area name and each county or county equivalent, in the CBSA area. Counties not listed in this Table are considered to be rural areas. Wage Index values for these areas are found in Table B.
Start Printed Page 45168

Table B.—Hospice Wage Index for Rural Areas

CBSA code No.Nonurban areaWage index 3
22Massachusetts 51.0832
30New Hampshire1.0543
31New Jersey 4
32New Mexico******
33New York******
34North Carolina******
35North Dakota0.8213
40Puerto Rico 50.4654
41Rhode Island 4
42South Carolina******
43South Dakota0.8905
48Virgin Islands0.8000
51West Virginia0.8458
* Denotes that there are different wage index values within the State. Specific codes to be used for processing claims and applicable wage index values can be found in Table C. Wage index values for these States are a blend of what they would have received had the MSA designations remained in effect and what they will receive under the CBSA designations. The budget neutrality adjustment factors of 1.060339 and 1.060988 have been applied to the MSA and the CBSA hospital wage data, respectively.
3 Wage index values are based on FY 2001 hospital cost report data before reclassification. This wage index is further adjusted. Wage index values greater than 0.8 are subject to a budget neutrality adjustment. Wage index values below 0.8 are adjusted to be the greater of a 15-percent increase, subject to a maximum wage index value of 0.8, or a budget neutrality adjustment calculated by multiplying the hospital wage index value for a given area by the budget neutrality factor. We have completed all of these adjustments and included them in the wage index values reflected in this table.
4 All counties within the State are classified as urban.
5 Based on CBSA designations Massachusetts and Puerto Rico have areas designated as rural. However, no IPPS hospitals are located in those rural area(s) for FY 2006. Because more recent data is not available for those areas, we are using the FY 2005 pre-floor, pre-reclassified hospital wage index value for rural Massachusetts and for rural Puerto Rico.

Table C.—Blended Hospice Wage Index Codes for Selected Areas

CBSA codeCBSA nameMSA codeState county codeCounty nameSpecial hospice wage index codeWage index
01Alabama0101240DE KALB500010.8096
Start Printed Page 45169
03Arizona0303110SANTA CRUZ500070.9586
10Florida1010130DE SOTO500160.9172
11Georgia1111070BEN HILL500200.8475
Start Printed Page 45170
11Georgia1111612JEFF DAVIS500200.8475
Start Printed Page 45171
14Illinois1414180DE WITT500310.8845
14Illinois1414510JO DAVIESS500310.8845
14Illinois1414580LA SALLE500310.8845
14Illinois1414630MC DONOUGH500310.8845
Start Printed Page 45172
15Indiana276015160DE KALB502250.9753
Start Printed Page 45173
18Kentucky1818720MC CRACKEN500540.8273
18Kentucky1818730MC CREARY500540.8273
Start Printed Page 45174
19Louisiana1919170EAST CARROLL500600.8000
19Louisiana1919260JEFFRSON DAVIS500600.8000
19Louisiana1919290LA SALLE500600.8000
19Louisiana1919400RED RIVER500600.8000
19Louisiana1919500ST. MARY500600.8000
19Louisiana1919610WEST CARROLL500600.8000
19Louisiana388019480ST. LANDRY502560.8297
19Louisiana556019460ST. JAMES502860.8826
23Michigan2323270GRAND TRAVERSE500670.9295
Start Printed Page 45175
23Michigan2323700PRESQUE ISLE500670.9295
23Michigan2323740ST. JOSEPH500670.9295
29Nevada2929160WHITE PINE500871.0136
32New Mexico3232010CATRON500890.9127
32New Mexico3232020CHAVES500890.9127
32New Mexico3232025CIBOLA500890.9127
32New Mexico3232030COLFAX500890.9127
32New Mexico3232040CURRY500890.9127
32New Mexico3232050DE BACA500890.9127
32New Mexico3232070EDDY500890.9127
32New Mexico3232080GRANT500890.9127
32New Mexico3232090GUADALUPE500890.9127
32New Mexico3232100HARDING500890.9127
32New Mexico3232110HIDALGO500890.9127
32New Mexico3232120LEA500890.9127
32New Mexico3232130LINCOLN500890.9127
32New Mexico3232140LUNA500890.9127
32New Mexico3232150MCKINLEY500890.9127
32New Mexico3232160MORA500890.9127
32New Mexico3232170OTERO500890.9127
32New Mexico3232180QUAY500890.9127
32New Mexico3232190RIO ARRIBA500890.9127
32New Mexico3232200ROOSEVELT500890.9127
32New Mexico3232230SAN MIGUEL500890.9127
32New Mexico3232250SIERRA500890.9127
32New Mexico3232260SOCORRO500890.9127
32New Mexico3232999STATEWIDE500890.9127
32New Mexico3232270TAOS500890.9127
32New Mexico3232290UNION500890.9127
Start Printed Page 45176
32New Mexico749032131LOS ALAMOS503251.0219
33New York3333010ALLEGANY500910.8779
33New York3333040CATTARAUGUS500910.8779
33New York3333080CHENANGO500910.8779
33New York3333090CLINTON500910.8779
33New York3333200COLUMBIA500910.8779
33New York3333210CORTLAND500910.8779
33New York3333220DELAWARE500910.8779
33New York3333260ESSEX500910.8779
33New York3333270FRANKLIN500910.8779
33New York3333280FULTON500910.8779
33New York3333300GREENE500910.8779
33New York3333310HAMILTON500910.8779
33New York3333330JEFFERSON500910.8779
33New York3333340LEWIS500910.8779
33New York3333570OTSEGO500910.8779
33New York3333670SCHUYLER500910.8779
33New York3333680SENECA500910.8779
33New York3333630ST. LAWRENCE500910.8779
33New York3333999STATEWIDE500910.8779
33New York3333690STEUBEN500910.8779
33New York3333710SULLIVAN500910.8779
33New York3333900WYOMING500910.8779
33New York3333910YATES500910.8779
33New York016033380MONTGOMERY501640.8868
33New York361033060CHAUTAUQUA502480.8348
33New York684033290GENESEE503130.9199
33New York816033050CAYUGA503360.9304
34North Carolina3434020ALLEGHANY500920.9049
34North Carolina3434040ASHE500920.9049
34North Carolina3434050AVERY500920.9049
34North Carolina3434060BEAUFORT500920.9049
34North Carolina3434070BERTIE500920.9049
34North Carolina3434080BLADEN500920.9049
34North Carolina3434140CAMDEN500920.9049
34North Carolina3434150CARTERET500920.9049
34North Carolina3434160CASWELL500920.9049
34North Carolina3434190CHEROKEE500920.9049
34North Carolina3434200CHOWAN500920.9049
34North Carolina3434210CLAY500920.9049
34North Carolina3434220CLEVELAND500920.9049
34North Carolina3434230COLUMBUS500920.9049
34North Carolina3434240CRAVEN500920.9049
34North Carolina3434270DARE500920.9049
34North Carolina3434300DUPLIN500920.9049
34North Carolina3434360GATES500920.9049
34North Carolina3434370GRAHAM500920.9049
34North Carolina3434380GRANVILLE500920.9049
34North Carolina3434410HALIFAX500920.9049
34North Carolina3434420HARNETT500920.9049
34North Carolina3434450HERTFORD500920.9049
34North Carolina3434470HYDE500920.9049
34North Carolina3434480IREDELL500920.9049
34North Carolina3434490JACKSON500920.9049
34North Carolina3434510JONES500920.9049
34North Carolina3434520LEE500920.9049
34North Carolina3434530LENOIR500920.9049
34North Carolina3434560MACON500920.9049
34North Carolina3434580MARTIN500920.9049
34North Carolina3434550MC DOWELL500920.9049
34North Carolina3434600MITCHELL500920.9049
34North Carolina3434610MONTGOMERY500920.9049
34North Carolina3434620MOORE500920.9049
34North Carolina3434650NORTHAMPTON500920.9049
34North Carolina3434680PAMLICO500920.9049
34North Carolina3434690PASQUOTANK500920.9049
34North Carolina3434710PERQUIMANS500920.9049
34North Carolina3434740POLK500920.9049
Start Printed Page 45177
34North Carolina3434760RICHMOND500920.9049
34North Carolina3434770ROBESON500920.9049
34North Carolina3434800RUTHERFORD500920.9049
34North Carolina3434810SAMPSON500920.9049
34North Carolina3434820SCOTLAND500920.9049
34North Carolina3434999STATEWIDE500920.9049
34North Carolina3434850SURRY500920.9049
34North Carolina3434860SWAIN500920.9049
34North Carolina3434870TRANSYLVANIA500920.9049
34North Carolina3434880TYRRELL500920.9049
34North Carolina3434900VANCE500920.9049
34North Carolina3434920WARREN500920.9049
34North Carolina3434930WASHINGTON500920.9049
34North Carolina3434940WATAUGA500920.9049
34North Carolina3434960WILKES500920.9049
34North Carolina3434970WILSON500920.9049
34North Carolina3434981YANCEY500920.9049
34North Carolina152034540LINCOLN501920.9691
34North Carolina152034790ROWAN501920.9691
34North Carolina3434830STANLY501920.9049
34North Carolina312034280DAVIDSON502340.9480
36Ohio3636820VAN WERT501000.9255
Start Printed Page 45178
37Oklahoma3737640ROGER MILLS501040.8077
Start Printed Page 45179
39Pennsylvania3939520MC KEAN501080.8834
42South Carolina4242000ABBEVILLE501140.9187
42South Carolina4242020ALLENDALE501140.9187
42South Carolina4242040BAMBERG501140.9187
42South Carolina4242050BARNWELL501140.9187
42South Carolina4242060BEAUFORT501140.9187
42South Carolina4242110CHESTER501140.9187
42South Carolina4242120CHESTERFIELD501140.9187
42South Carolina4242130CLARENDON501140.9187
42South Carolina4242140COLLETON501140.9187
42South Carolina4242160DILLON501140.9187
42South Carolina4242210GEORGETOWN501140.9187
42South Carolina4242230GREENWOOD501140.9187
42South Carolina4242240HAMPTON501140.9187
42South Carolina4242260JASPER501140.9187
42South Carolina4242280LANCASTER501140.9187
42South Carolina4242300LEE501140.9187
42South Carolina4242330MARION501140.9187
42South Carolina4242340MARLBORO501140.9187
42South Carolina4242320MCCORMICK501140.9187
42South Carolina4242350NEWBERRY501140.9187
42South Carolina4242360OCONEE501140.9187
42South Carolina4242370ORANGEBURG501140.9187
42South Carolina4242999STATEWIDE501140.9187
42South Carolina4242430UNION501140.9187
42South Carolina4242440WILLIAMSBURG501140.9187
42South Carolina316042100CHEROKEE502370.9590
Start Printed Page 45180
44Tennessee4444200DE KALB501210.8350
44Tennessee4444530MC MINN501210.8350
44Tennessee4444540MC NAIRY501210.8350
44Tennessee4444870VAN BUREN501210.8350
Start Printed Page 45181
45Texas4545420DE WITT501250.8420
45Texas4545392DEAF SMITH501250.8420
45Texas4545691JEFF DAVIS501250.8420
45Texas4545710JIM HOGG501250.8420
45Texas4545711JIM WELLS501250.8420
45Texas4545753LA SALLE501250.8420
Start Printed Page 45182
45Texas4545760LIVE OAK501250.8420
45Texas4545772MC CULLOCH501250.8420
45Texas4545781MC MULLEN501250.8420
45Texas4545841PALO PINTO501250.8420
45Texas4545874RED RIVER501250.8420
45Texas4545883SAN AUGUSTINE501250.8420
45Texas4545886SAN SABA501250.8420
Start Printed Page 45183
45Texas4545946VAL VERDE501250.8420
45Texas4545947VAN ZANDT501250.8420
46Utah4646010BOX ELDER501400.9084
46Utah4646180SAN JUAN501400.9084
49Virginia4949141BUENA VISTA CITY501450.8765
49Virginia4949211CLIFTON FORGE CITY501450.8765
49Virginia4949213COVINGTON CITY501450.8765
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49Virginia4949328FRANKLIN CITY501450.8765
49Virginia4949343GALAX CITY501450.8765
49Virginia4949522LEXINGTON CITY501450.8765
Start Printed Page 45184
49Virginia4949561MARTINSVILLE CITY501450.8765
49Virginia4949610NANSEMOND CITY501450.8765
49Virginia4949661NORTON CITY501450.8765
49Virginia4949730PRINCE EDWARD501450.8765
49Virginia4949867SOUTH BOSTON CITY501450.8765
49Virginia4949891STAUNTON CITY501450.8765
49Virginia4949951WAYNESBORO CITY501450.8765
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Start Printed Page 45185
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12940Baton Rouge, LA1919180EAST FELICIANA500620.8413
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16820Charlottesville, VA4949620NELSON501460.9956
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17780College Station-Bryan, TX4545878ROBERTSON501280.9097
17780College Station-Bryan, TX126045190BRAZOS501870.9804
Start Printed Page 45187
17820Colorado Springs, CO0606590TELLER500141.0161
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19740Denver-Aurora, CO0606090CLEAR CREEK500151.0751
19740Denver-Aurora, CO0606190ELBERT500151.0751
19740Denver-Aurora, CO0606230GILPIN500151.0751
19740Denver-Aurora, CO0606460PARK500151.0751
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19740Denver-Aurora, CO208006150DENVER502111.1565
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20500Durham, NC3434720PERSON500951.0004
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20500Durham, NC664034310DURHAM503071.0936
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20764Edison, NJ501531270MIDDLESEX502791.1930
Start Printed Page 45188
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21780Evansville, IN-KY1515250GIBSON500390.9073
21780Evansville, IN-KY1818989WEBSTER500570.8600
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21780Evansville, IN-KY244015640POSEY502190.8892
21780Evansville, IN-KY244015810VANDERBURGH502190.8892
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22180Fayetteville, NC3434460HOKE500960.9473
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24340Grand Rapids-Wyoming, MI2323610NEWAYGO500680.9631
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24660Greensboro-High Point, NC3434780ROCKINGHAM500970.9382
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25060Gulfport-Biloxi, MS2525650STONE500720.8768
25060Gulfport-Biloxi, MS092025220HANCOCK501800.9333
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25180Hagerstown-Martinsburg, MD-WV318021210WASHINGTON502391.0424
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25620Hattiesburg, MS328525170FORREST502410.8000
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26420Houston-Sugar Land-Baytown, TX4545070AUSTIN501320.9484
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26420Houston-Sugar Land-Baytown, TX114545180BRAZORIA501860.9810
26420Houston-Sugar Land-Baytown, TX292045550GALVESTON502291.0276
26420Houston-Sugar Land-Baytown, TX336045280CHAMBERS502421.0654
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Start Printed Page 45189
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26980Iowa City, IA1616910WASHINGTON500470.9654
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28660Killeen-Temple-Fort Hood, TX4545752LAMPASAS501330.9096
28660Killeen-Temple-Fort Hood, TX381045120BELL502540.9803
28660Killeen-Temple-Fort Hood, TX381045341CORYELL502540.9803
29140Lafayette, IN1515030BENTON500420.9442
29140Lafayette, IN1515070CARROLL500420.9442
29140Lafayette, IN392015780TIPPECANOE502580.9617
29340Lake Charles, LA1919110CAMERON500630.8209
29340Lake Charles, LA396019090CALCASIEU502590.8436
29404Lake County-Kenosha County, IL-WI160014570LAKE501961.1239
29404Lake County-Kenosha County, IL-WI380052290KENOSHA502531.0667
30300Lewiston, ID-WA1313340NEZ PERCE500280.9620
30300Lewiston, ID-WA5050010ASOTIN501531.0281
30700Lincoln, NE2828790SEWARD500841.0205
30700Lincoln, NE436028540LANCASTER502641.0827
30780Little Rock-North Little Rock, AR0404260GRANT500110.8766
30780Little Rock-North Little Rock, AR0404520PERRY500110.8766
30780Little Rock-North Little Rock, AR440004220FAULKNER502650.9361
30780Little Rock-North Little Rock, AR440004420LONOKE502650.9361
30780Little Rock-North Little Rock, AR440004590PULASKI502650.9361
30780Little Rock-North Little Rock, AR440004620SALINE502650.9361
30860Logan, UT-ID1313200FRANKLIN500290.9504
30860Logan, UT-ID4646020CA