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Notice

Medicare Program; Changes to the Hospital Inpatient Prospective Payment Systems and Fiscal Year 2007 Rates; Final Fiscal Year 2007 Wage Indices and Payment Rates After Application of Revised Occupational Mix Adjustment to the Wage Index; Corrections

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AGENCY:

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

ACTION:

Correction of notice.

SUMMARY:

This document corrects wage index and technical errors that appeared in the notice published in the Federal Register on October 11, 2006 entitled “Medicare Program; Hospital Inpatient Prospective Payment Systems and Fiscal Year 2007 Rates.

DATES:

Effective Date: Corrections listed in items 10 through 12 of section III. of this notice are effective as of October 1, 2006. The corrections to the wage index listed in items 2a, 3 through 8a, and 9a of section III. of this notice are effective as of November 3, 2006. The corrections to the wage index listed in items 1, 2b, 8b, and 9b of section III. of this notice are effective as of November 21, 2006.

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FOR FURTHER INFORMATION CONTACT:

Marc Hartstein, (410) 786-4548.

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SUPPLEMENTARY INFORMATION:

I. Background

In FR Doc. 06-8471 of October 11, 2006 (71 FR 59886), the notice entitled “Hospital Inpatient Prospective Payment Systems and Fiscal Year 2007 Rates: Final Fiscal Year 2007 Wage Indices and Payment Rates After Application of Revised Occupational Mix Adjustment to Wage Index” (hereinafter referred to as the “FY 2007 IPPS notice”), there were a number of technical errors that are identified and corrected in the Correction of Errors section (items 10 through 12 of section III. of this notice). These technical corrections are effective October 1, 2006.

In addition, in October 2006, we became aware of an error in the calculation of the FY 2007 wage index for a number of rural areas and several hospitals that are reclassified to those areas. The error also affected some hospitals in urban areas that are assigned the statewide rural wage index floor. Section 412.64(k)(1) of the regulations requires that wage index corrections made after October 1 are effective prospectively for the remainder of the fiscal year from the date the fiscal intermediaries are informed of the correction. We recalculated the wage indices for the affected hospitals, and on November 3, 2006, sent a Joint Signature Memorandum to the fiscal intermediaries informing them to pay hospitals using the corrected wage indices. Subsequent to the November 3, 2006 Joint Signature Memorandum, additional errors in the wage indices were brought to our attention and were corrected through a November 21, 2006 Joint Signature Memorandum. Therefore, the corrected FY 2007 wage indices are effective beginning November 3, 2006 or November 21, 2006. Accordingly, the wage index provisions of this correction notice are corrections to the tabulation of the rates paid to hospitals. We note that the Start Printed Page 570corrections to the impact analysis (item 1 of section III. of this notice) are effective as of November 3, 2006 since the additional corrections made based on the November 21, 2006 Joint Signature Memorandum had no significant effect on the impact analysis.

II. Summary of the Corrections to the FY 2007 IPPS Notice

We made corrections to wage index values and geographic adjustment factors (GAFs) that were published in Tables 2, 4A-1, 4A-2, 4B-1, 4B-2, 4C-1, and 4C-2. In addition, we are making technical corrections to— (1) the out-migration adjustments and qualifying counties that were published in Table 4J; and (2) the list of diagnosis-related groups (DRGs), relative weighting factors, and geometric and arithmetic mean length of stay (LOS) that were published in Table 5.

III. Correction of Errors

In FR Doc. 06-8471 of October 11, 2006 (71 FR 59886), make the following corrections:

1. On pages 59893 and 59894, in Table I.—Impact Analysis of Changes for FY 2007, the figures in the last column (All FY 2007 changes 8) are corrected to read as follows:

Impact Analysis of Final Changes for FY 2007 Operating Prospective Payment System

[Percent changes in payments per case]

All FY 2007 changes (4)
All Hospitals3.5
By Geographic Location:
Urban hospitals3.5
Large urban areas (populations over 1 million)3.5
Other urban areas (populations of 1 million or fewer)3.4
Rural hospitals4
Bed Size (Urban):
0-99 beds3.5
100-199 beds3.8
200-299 beds3.6
300-499 beds3.4
500 or more beds3.2
Bed Size (Rural):
0-49 beds4.7
50-99 beds4.9
100-149 beds3.7
150-199 beds3.3
200 or more beds3.0
Urban by Region:
New England3.9
Middle Atlantic3.9
South Atlantic3.2
East North Central3.4
East South Central2.7
West North Central2.8
West South Central3.4
Mountain3.7
Pacific3.7
Puerto Rico2.0
Rural by Region:
New England6.3
Middle Atlantic5.2
South Atlantic3.9
East North Central3.8
East South Central3.5
West North Central4.3
West South Central4.1
Mountain2.7
Pacific3.3
By Payment Classification:
Urban hospitals3.4
Large urban areas (populations over 1 million)3.5
Other urban areas (populations of 1 million or fewer)3.4
Rural areas4.0
Teaching Status:
Non-teaching3.8
Fewer than 100 Residents3.4
100 or more Residents3.2
Urban DSH:
Non-DSH3.6
100 or more beds3.4
Less than 100 beds3.6
Rural DSH:
SCH4.6
RRC3.5
Other Rural:
100 or more beds3.5
Less than 100 beds3.9
Urban teaching and DSH:
Both teaching and DSH3.3
Teaching and no DSH3.3
No teaching and DSH3.7
No teaching and no DSH3.6
Rural Hospital Types:
RRC3.5
SCH3.6
MDH9.0
SCH and RRC3.1
MDH and RRC14.1
Unknown
Type of Ownership:
Voluntary3.5
Proprietary3.5
Government3.4
Unknown7.6
Medicare Utilization as a Percent of Inpatient Days:
0-253.6
25-503.3
50-653.7
Over 653.8
Unknown4.4
Hospitals Reclassified by the Medicare Geographic Classification Review Board:
FY 2005 Reclassifications
Urban Hospitals Reclassified by the Medicare Geographic Classification Review Board: First Half FY 2007 Reclassifications3.7
Urban Nonreclassified, First Half FY 20073.4
All Urban Hospitals Reclassified Second Half FY 20073.5
Urban Nonreclassified Hospitals Second Half FY 20073.4
All Rural Hospitals Reclassified Second Half FY 20073.6
Rural Nonreclassified Hospitals Second Half FY 20074.5
All Section 401 Reclassified Hospitals5.4
Other Reclassified Hospitals (Section 1886(d)(8)(B))4.5
Section 508 Hospitals2
Specialty Hospitals
Cardiac Specialty Hospitals1.2

2. On pages 59903 through to 59968, in Table 2.—Hospital Case-Mix Indexes for Discharges Occurring in Federal Fiscal Year 2005; Hospital Wage Indexes for Federal Fiscal Year 2007; Hospital Average Hourly Wages for Federal Fiscal Years 2005 (2001 Wage Data), 2006 (2002 Wage Data), and 2007 (2003 Wage Data); Wage Indexes and 3-Year Average of Hospital Average Hourly Wages, for the listed providers, the wage indexes are corrected to read as follows:

a. Effective November 3, 2006

Provider No.FY 2007 wage index
0400390.8341
0400470.8431
0700021.2452
0700031.2461
0700041.2452
0700071.2452
0700081.2452
0700091.2452
0700111.2452
0700121.2452
0700151.2452
0700201.2525
0700211.2461
0700241.2452
0700251.2452
0700271.2452
0700291.2452
0700351.2452
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0700381.2452
1000250.8847
1000260.8847
1000270.8847
1000480.8847
1000540.8847
1000620.8907
1000810.8847
1000930.8847
1001020.8972
1001060.8847
1001080.8847
1001180.9245
1001220.8847
1001240.8847
1001340.8847
1001420.8847
1001560.8972
1001600.8847
1001750.9078
1002120.8907
1002230.8847
1002310.8847
1002420.8847
1002660.8847
1002900.9429
1002920.8847
2302541.0381
2302571.0381
2302641.0381
2302691.0381
2302771.0381
2600040.8341
2600060.8341
2600150.8345
2600220.8615
2600240.8341
2600470.8348
2600590.8341
2600610.8341
2600700.8341
2600740.8499
2600780.8341
2600800.8341
2600970.8766
2601130.8341
2601160.8341
2601190.8345
2601420.8341
2601470.8341
2601600.8341
2601630.8341
2601950.8341
2800610.9048
3400730.9828
3800021.0282
3800401.0152
3800521.0152
3800811.0152
3900441.1196
3900961.1196
4300940.9048
4700011.0770
4700051.0383
4700121.0383
4700241.0383
5000021.0390
5000071.0598
5000121.0390
5000191.0603
5000311.0390
5000331.0390
5000361.0390
5000371.0390
5000491.0390
5000531.0390
5000581.0390
5001481.0390
5300020.9128
5300060.9128
5300080.9128
5300090.9128
5300100.9128
5300110.9128
5300140.9128
5300170.9128
5300320.9128
5300080.9057
5300090.9057
5300100.9057
5300110.9057
5300140.9057
5300170.9057
5300320.9057

b. Effective November 21, 2006.

Provider No.FY 2007 wage index
2300131.0381
2300191.0381
2300291.0381
2300471.0381
2300711.0381
2301301.0381
2301511.0381
2301951.0381
2302041.0381
2302071.0381
2302231.0381
2302271.0381
2302541.0381
2302571.0381
2302641.0381
2302691.0381
2302771.0381
3900651.0977
3901381.0977
4900051.0977

3. On page 59968 in Table 2.—Hospital Case-Mix Indexes for Discharges Occurring in Federal Fiscal Year 2005; Hospital Wage Indexes for Federal Fiscal Year 2007; Hospital Average Hourly Wages for Federal Fiscal Years 2005 (2001 Wage Data), 2006 (2002 Wage Data), and 2007 (2003 Wage Data); Wage Indexes and 3-Year Average of Hospital Average Hourly Wages, the table is corrected by adding a note to the end of the table to read as follows:

Note:

Due to the expiration of section 508 of the MMA, the wage index values for some hospitals will change in the second half of the fiscal year. The wage index values in this table reflect an average of the first half of FY 2007 (October 1, 2006-March 31, 2007) and second half of FY 2007 (April 1-September 30, 2007).

4. On pages 59975 through to 59998, in Table 4A-1.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Urban Areas by CBSA, for the listed CBSAs, the wage indexes and GAFs are corrected to read as follows:

CBSA codeUrban area (constituent counties)Wage indexGAF
15540Burlington-South Burlington, VT Chittenden County, VT 2 Franklin County, VT Grand Isle County, VT1.03831.0261
23020Fort Walton Beach-Crestview-Destin, FL2 Okaloosa County, FL0.88470.9195
25540Hartford-West Hartford-East Hartford, CT 12 Hartford County, CT Litchfield County, CT Middlesex County, CT Tolland County, CT1.24521.1620
28420Kennewick-Richland-Pasco, WA2 Benton County, WA Franklin County, WA1.03901.0265
30300Lewiston, ID-WA (WA Hospitals) 2 Nez Perce County, ID Asotin County, WA1.03901.0265
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31020Longview, WA Cowlitz County, WA1.03901.0265
34580Mount Vernon-Anacortes, WA Skagit County, WA1.03901.0265
35300New Haven-Milford, CT 3 New Haven County, CT1.24521.1620
35980Norwich-New London, CT New London County, CT1.24521.1620
36100Ocala, FL2 Marion County, FL0.88470.9195
37460Panama City-Lynn Haven, FL Bay County, Fl0.88470.9195
37860Pensacola-Ferry Pass-Brent, FL Escambia County, FL Santa Rosa County, FL0.88470.9195
48300Wenatchee, WA Chelan County, WA Douglas County, WA1.03901.0265
49420Yakima, WA Yakima County, WA1.03901.0265
1 Large urban area.
2 Hospitals geographically located in the area are assigned the statewide rural wage index for FY 2007.
3 For this area, the wage index and GAF on this table are only effective from October 1, 2006 through March 31, 2007. See Table 4A-2 for the values that are effective from April 1 through September 30, 2007.

5. On page 59998, in Table 4A-2.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Certain Urban Areas by CBSA for the Period April 1 Through September 30, 2007, for the listed CBSAs, the wage indexes and GAFs are corrected to read as follows:

CBSA codeUrban area (constituent counties)Wage indexGAF
16940Cheyenne, WY0.90570.9344
35300New Haven-Milford, CT1.24521.1620

6. On pages 59998 and 59999, in Table 4B-1.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Rural Areas by CBSA—FY 2007, for the listed CBSAs, the wage indexes and GAFs are corrected to read as follows:

CBSA codeNonurban areaWage indexGAF
07Connecticut1.24521.1620
10Florida0.88470.9195
26Missouri0.83410.8832
38Oregon 21.01521.0104
47Vermont1.03831.0261
50Washington1.03901.0265

7. On page 59999, in Table 4B-2.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Certain Rural Areas by CBSA for the Period April 1 Through September 30, 2007, for the listed CBSA, the wage index and GAF is corrected to read as follows:

CBSA codeNonurban areaWage indexGAF
53Wyoming0.90570.9344

8. On pages 59999 through to 60003, in Table 4C-1.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Hospitals That Are Reclassified by CBSA, for the listed CBSAs, the wage indexes and GAFs are corrected to read as follows:

a. Effective November 3, 2006.

CBSA codeAreaWage indexGAF
23020Fort Walton Beach-Crestview-Destin, FL0.88470.9195
25540Hartford-West Hartford-East Hartford, CT (CT Hospitals)1.24521.1620
27860Jonesboro, AR (MO Hospitals)0.83450.8835
28420Kennewick-Richland-Pasco, WA1.03901.0265
38340Pittsfield, MA1.03831.0261
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07Connecticut1.24521.1620
10Florida (FL Hospitals)0.88470.9195
14Illinois (MO Hospitals)0.83410.8832
16Iowa0.86150.9029
26Missouri0.83410.8832
30New Hampshire1.07701.0521
38Oregon1.01521.0104
50Washington (WA Hospitals)1.03901.0265
53Wyoming0.90480.9338

b. Effective November 21, 2006.

CBSA codeAreaWage indexGAF
47894Washington-Arlington-Alexandria, DC-VA-MD-WV1.09771.0659

9. On page 60003, in Table 4C-2.—Wage Index and Capital Geographic Adjustment Factor (GAF) for Certain Hospitals That Are Reclassified by CBSA for the Period April 1 Through September 30, 2007*, CBSAs 35300 and 19804 are corrected and CBSA 47894 is added. The wage indexes and GAFs are corrected to read as follows:

a. Effective November 3, 2006.

CBSA codeAreaWage indexGAF
19804Detroit-Livonia-Dearborn, MI1.03811.0192
35300New Haven-Milford, CT1.24521.1620

b. Effective November 21, 2006.

CBSA codeAreaWage indexGAF
47894Washington-Arlington-Alexandria, DC-VA-MD-WV1.09771.0659

10. On pages 60004 through to 60012, in Table 4J.—Out-Migration Adjustment—FY 2007, provider number 010009 is corrected and provider number 010010 is added to read as follows:

a. Effective October 1, 2006.

Provider No.Reclassified between 10/1/06 and 3/31/07Reclassified between 4/1/07 and 9/30/07Out-migration adjustmentQualifying county name
010009**0.0092MORGAN.
010010**0.0259MARSHALL.

11. On pages 60013 through to 60025, in Table 5.—List of Diagnosis-Related Groups (DRGS), Relative Weighting Factors, and Geometric and Arithmetic Mean Length of Stay (LOS), DRGs 525, 544, and 572 are corrected to read as follows:

a. Effective October 1, 2006.

DRGFY 07 final rule post-acute care DRGFY 07 final rule special pay DRGMDCTypeDRG titleWeightsGeometric mean LOSArithmetic mean LOS
525NoNo05SURGOther Heart Assist System Implant2.22687.714.3
544YesYes08SURGMajor Joint Replacement or Reattachment of Lower Extremity1.98784.04.4
572YesNo06MEDMajor Gastrointestinal Disorders and Peritoneal Infections1.33785.67.1

12. On page 60025 in Table 5.—List of Diagnosis-Related Groups (DRGs), Relative Weighting Factors, and Geometric and Arithmetic Mean Length of Stay (LOS), the table is corrected by adding the following notes to the end of the table:

a. Effective October 1, 2006.

Note:

If there is an asterisk in the “Type” column this means that data is unavailable to calculate weights for these low volume DRGs. Therefore, last year's weights have been updated based on the percent change in Start Printed Page 574normalization factors between FY 2006 and FY 2007.

Note:

If there is no value or dashes (that is, “----”) in either the geometric mean LOS or the arithmetic mean LOS columns, the volume of cases is insufficient to determine a meaningful computation of these statistics.

IV. Discussion of Effective Date and Notice and Comment Rulemaking

We ordinarily publish a notice of proposed rulemaking in the Federal Register to provide a period for public comment before the provisions of a rule take effect in accordance with section 553(b) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). In addition, a final rule would ordinarily require a 30-day delay in effective date after the date of publication in the Federal Register. This correction of the rates published in the FY 2007 IPPS notice does not constitute a rule under the Administrative Procedure Act, because, in our FY 2007 IPPS final rule (71 FR 47870, August 18, 2006), we already published the methodologies and formulas we use for determining the wage index, geographic adjustment factors, and other rates. This notice does not change our methodology or formulas, but merely ensures that our rules are implemented correctly. As this notice is not a rule under the Administrative Procedure Act, no notice of proposed rulemaking or delay in effective date is necessary.

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

Dated: December 28, 2006.

Ashley Files Flory,

Deputy Executive Secretary to the Department.

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[FR Doc. 06-9976 Filed 12-29-06; 1:29 pm]

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