98-12207. Medicare Program; Changes to the Hospital Inpatient Prospective Payment Systems and Fiscal Year 1999 Rates  

  • [Federal Register Volume 63, Number 89 (Friday, May 8, 1998)]
    [Proposed Rules]
    [Pages 25576-25715]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 98-12207]
    
    
    
    [[Page 25575]]
    
    _______________________________________________________________________
    
    Part III
    
    
    
    
    
    Department of Health and Human Services
    
    
    
    
    
    _______________________________________________________________________
    
    
    
    Health Care Financing Administration
    
    
    
    _______________________________________________________________________
    
    
    
    42 CFR Parts 405, 412, and 413
    
    
    
    Medicare Program; Changes to the Hospital Inpatient Prospective Payment 
    Systems and Fiscal Year 1999 Rates; Proposed Rule
    
    Federal Register / Vol. 63, No. 89 / Friday, May 8, 1998 / Proposed 
    Rules
    
    [[Page 25576]]
    
    
    
    DEPARTMENT OF HEALTH AND HUMAN SERVICES
    
    Health Care Financing Administration
    
    42 CFR Parts 405, 412, and 413
    
    [HCFA-1003-P]
    RIN 0938-AI22
    
    
    Medicare Program; Changes to the Hospital Inpatient Prospective 
    Payment Systems and Fiscal Year 1999 Rates
    
    AGENCY: Health Care Financing Administration (HCFA), HHS.
    
    ACTION: Proposed rule.
    
    -----------------------------------------------------------------------
    
    SUMMARY: We are proposing to revise the Medicare hospital inpatient 
    prospective payment systems for operating costs and capital-related 
    costs to implement applicable statutory requirements, including section 
    4407 of the Balanced Budget Act of 1997, as well as changes arising 
    from our continuing experience with the systems. In addition, in the 
    addendum to this proposed rule, we are describing proposed changes in 
    the amounts and factors necessary to determine rates for Medicare 
    hospital inpatient services for operating costs and capital-related 
    costs. These changes would be applicable to discharges occurring on or 
    after October 1, 1998. We are also setting forth proposed rate-of-
    increase limits as well as proposing changes for hospitals and hospital 
    units excluded from the prospective payment systems.
    
    DATES: Comments will be considered if received at the appropriate 
    address, as provided below, no later than 5 p.m. on July 7, 1998.
    
    ADDRESSES: Mail written comments (an original and three copies) to the 
    following address: Health Care Financing Administration, Department of 
    Health and Human Services, Attention: HCFA-1003-P, P.O. Box 7517, 
    Baltimore, MD 21207-0517.
        If you prefer, you may deliver your written comments (an original 
    and three copies) to one of the following addresses:
    
    Room 309-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW, 
    ashington, DC 20201, or
    Room C5-09-26, Central Building, 7500 Security Boulevard, Baltimore, MD 
    21244-1850.
        Because of staffing and resource limitations, we cannot accept 
    comments by facsimile (FAX) transmission. In commenting, please refer 
    to file code HCFA-1003-P. Comments received timely will be available 
    for public inspection as they are received, generally beginning 
    approximately three weeks after publication of a document, in Room 309-
    G of the Department's offices at 200 Independence Avenue, SW, 
    Washington, DC, on Monday through Friday of each week from 8:30 a.m. to 
    5 p.m. (phone: (202) 690-7890).
        For comments that relate to information collection requirements, 
    mail a copy of comments to:
    
    Office of Information and Regulatory Affairs, Office of Management and 
    Budget, Room 10235, New Executive Office Building, Washington, DC 
    20503, Attn: Allison Herron Eydt, HCFA Desk Officer; and
    Office of Financial and Human Resources, Management Planning and 
    Analysis Staff, Room C2-26-17, 7500 Security Boulevard, Baltimore, MD 
    21244-1850.
    
        Copies: To order copies of the Federal Register containing this 
    document, send your request to: New Orders, Superintendent of 
    Documents, P.O. Box 371954, Pittsburgh, PA 15250-7954. Specify the date 
    of the issue requested and enclose a check or money order payable to 
    the Superintendent of Documents, or enclose your Visa or Master Card 
    number and expiration date. Credit card orders can also be placed by 
    calling the order desk at (202) 512-1800 or by faxing to (202) 512-
    2250. The cost for each copy is $8.00. As an alternative, you can view 
    and photocopy the Federal Register document at most libraries 
    designated as Federal Depository Libraries and at many other public and 
    academic libraries throughout the country that receive the Federal 
    Register.
        This Federal Register document is also available from the Federal 
    Register online database through GPO Access, a service of the U.S. 
    Government Printing Office. Free public access is available on a Wide 
    Area Information Server (WAIS) through the Internet and via 
    asynchronous dial-in. Internet users can access the database by using 
    the World Wide Web; the Superintendent of Documents home page address 
    is http://www.access.gpo.gov/su__docs/, by using local WAIS client 
    software, or by telnet to swais.access.gpo.gov, then login as guest (no 
    password required). Dial-in users should use communications software 
    and modem to call (202) 512-1661; type swais, then login as guest (no 
    password required).
    
    FOR FURTHER INFORMATION CONTACT:
    
    Nancy Edwards, (410) 786-4531, Operating Prospective Payment, DRG, and 
    Wage Index Issues.
    Tzvi Hefter, (410) 786-4487, Capital Prospective Payment, Excluded 
    Hospitals, and Graduate Medical Education Issues.
    
    SUPPLEMENTARY INFORMATION:
    
    I. Background
    
    A. Summary
    
        Sections 1886(d) and (g) of the Social Security Act (the Act), set 
    forth a system of payment for the operating costs of acute care 
    hospital inpatient stays under Medicare Part A (Hospital Insurance) 
    based on prospectively-set rates. Section 1886(g) of the Act requires 
    the Secretary to pay for the capital-related costs of hospital 
    inpatient stays under a prospective payment system. Under these 
    prospective payment systems, Medicare payment for hospital inpatient 
    operating and capital-related costs is made at predetermined, specific 
    rates for each hospital discharge. Discharges are classified according 
    to a list of diagnosis-related groups (DRGs).
        Certain specialty hospitals are excluded from the prospective 
    payment systems. Under section 1886(d)(1)(B) of the Act, the following 
    hospitals and units are excluded from PPS: psychiatric hospitals or 
    units, rehabilitation hospitals or units, children's hospitals, long 
    term care hospitals, and cancer hospitals. For these hospitals and 
    units, Medicare payment for operating costs is based on reasonable 
    costs subject to a hospital-specific annual limit.
        Under section 1886(a)(4) of the Act, costs incurred in connection 
    with approved graduate medical education (GME) programs are excluded 
    from the operating costs of inpatient hospital services. Hospitals with 
    approved GME programs are paid for the direct costs of GME in 
    accordance with section 1886(h) of the Act; the amount of payment for 
    direct GME costs for a cost reporting period is based on the number of 
    the hospital's residents in that period and the hospital's costs per 
    resident in a base year.
        The regulations governing the hospital inpatient prospective 
    payment system are located in 42 CFR Part 412. The regulations 
    governing excluded hospitals are located in both Parts 412 and 413, and 
    the graduate medical education regulations are found in Part 413.
        On August 29, 1997, we published a final rule with comment period 
    in the Federal Register (62 FR 45966) setting forth both statutorily 
    required changes and other changes to the Medicare hospital inpatient 
    prospective payment systems for both operating costs and capital-
    related costs, which were effective for discharges occurring on or 
    after October 1, 1997. This rule also
    
    [[Page 25577]]
    
    implemented changes addressing payments for excluded hospitals and 
    payments for graduate medical education costs. This final rule with 
    comment period followed a proposed rule published in the Federal 
    Register on June 2, 1997 (62 FR 29902) that set forth proposed updates 
    and changes.
    
    B. Major Contents of This Proposed Rule
    
        In this proposed rule, we are setting forth proposed changes to the 
    Medicare hospital inpatient prospective payment systems for both 
    operating costs and capital-related costs. This proposed rule would be 
    effective for discharges occurring on or after October 1, 1998. 
    Following is a summary of the major changes that we are proposing to 
    make:
    1. Changes to the DRG Classifications and Relative Weights
        As required by section 1886(d)(4)(C) of the Act, we must adjust the 
    DRG classifications and relative weights at least annually. Our 
    proposed changes for FY 1999 are set forth in section II. of this 
    preamble.
    2. Changes to the Hospital Wage Index
        In section III. of this preamble, we discuss proposed revisions to 
    the wage index and the annual update of the wage data. Specific issues 
    addressed in this section include the following:
         FY 1999 wage index update.
         Changes to the data categories included in the wage index.
         Revisions to the wage index based on hospital 
    redesignations.
    3. Other Decisions and Changes to the Prospective Payment System for 
    Inpatient Operating and Graduate Medical Education Costs
        In section IV. of this preamble, we discuss several provisions of 
    the regulations in 42 CFR parts 412 and 413 and set forth certain 
    proposed changes concerning the following:
         Definition of transfer cases.
         Rural referral centers.
         Disproportionate share adjustment.
         Bad debts.
         Direct graduate medical education programs.
    4. Changes to the Prospective Payment System for Capital-Related Costs
        In section V. of this preamble, we discuss several provisions of 
    the regulations in 42 CFR part 412 and set forth certain proposed 
    changes and clarifications concerning the following:
         Capital indirect medical education payments.
         Payments to new hospitals.
    5. Changes for Hospitals and Hospital Units Excluded from the 
    Prospective Payment Systems
        In section VI. of this preamble, we discuss the following criteria 
    governing excluded hospital issues:
         Hospital-within-a-hospital.
         Adjustments to the target amounts for FY 1999.
    6. Determining Prospective Payment Operating and Capital Rates and 
    Rate-of-Increase Limits
        In the addendum to this proposed rule, we set forth proposed 
    changes to the amounts and factors for determining the FY 1999 
    prospective payment rates for operating costs and capital-related 
    costs. We are also proposing update factors for determining the rate-
    of-increase limits for cost reporting periods beginning in FY 1999 for 
    hospitals and hospital units excluded from the prospective payment 
    system.
    7. Impact Analysis
        In Appendix A, we set forth an analysis of the impact that the 
    proposed changes described in this proposed rule would have on affected 
    entities.
    8. Capital Acquisition Model
        Appendix B contains the technical appendix on the proposed FY 1999 
    capital cost model.
    9. Report to Congress on the Update Factor for Prospective Payment 
    Hospitals and Hospitals Excluded from the Prospective Payment System
        Section 1886(e)(3)(B) of the Act requires that the Secretary report 
    to Congress on our initial estimate of a recommended update factor for 
    FY 1999 for both hospitals included in and hospitals excluded from the 
    prospective payment systems. This report is included as Appendix C to 
    this proposed rule.
    10. Proposed Recommendation of Update Factor for Hospital Inpatient 
    Operating Costs
        As required by sections 1886(e)(4) and (e)(5) of the Act, Appendix 
    D provides our recommendation of the appropriate percentage change for 
    FY 1999 for the following:
         Large urban area and other area average standardized 
    amounts (and hospital-specific rates applicable to sole community and 
    Medicare-dependent, small rural hospitals) for hospital inpatient 
    services paid for under the prospective payment system for operating 
    costs.
         Target rate-of-increase limits to the allowable operating 
    costs of hospital inpatient services furnished by hospitals and 
    hospital units excluded from the prospective payment system.
    11. Discussion of Medicare Payment Advisory Commission Recommendations
        The Balanced Budget Act of 1997 abolished the Prospective Payment 
    Assessment Commission (ProPAC) and created the Medicare Payment 
    Advisory Commission (MedPAC). Under section 1805(b) of the Act, MedPAC 
    is required to submit a report to Congress, not later than March 1 of 
    each year, that reviews and makes recommendations on Medicare payment 
    policies. The March 1, 1998 report made several recommendations 
    concerning hospital inpatient payment policies. We reviewed those 
    recommendations and this document sets forth our responses to those 
    recommendations.
        Although it has been our practice to include a reprint of ProPAC's 
    March 1 report as an appendix to the proposed rule, we are not 
    following that practice with MedPAC reports. For further information 
    relating specifically to that report or to obtain a copy of the report, 
    contact MedPAC at (202) 653-7220.
    
    II. Proposed Changes to DRG Classifications and Relative Weights
    
    A. Background
    
        Under the prospective payment system, we pay for inpatient hospital 
    services on the basis of a rate per discharge that varies by the DRG to 
    which a beneficiary's stay is assigned. The formula used to calculate 
    payment for a specific case takes an individual hospital's payment rate 
    per case and multiplies it by the weight of the DRG to which the case 
    is assigned. Each DRG weight represents the average resources required 
    to care for cases in that particular DRG relative to the average 
    resources used to treat cases in all DRGs.
        Congress recognized that it would be necessary to recalculate the 
    DRG relative weights periodically to account for changes in resource 
    consumption. Accordingly, section 1886(d)(4)(C) of the Act requires 
    that the Secretary adjust the DRG classifications and relative weights 
    annually. These adjustments are made to reflect changes in treatment 
    patterns, technology, and any other factors that may change the 
    relative use of hospital resources. The proposed changes to the DRG 
    classification system and the proposed recalibration of the DRG weights 
    for discharges occurring on or after October 1, 1998 are discussed 
    below.
    
    [[Page 25578]]
    
    B. DRG Reclassification
    
    1. General
        Cases are classified into DRGs for payment under the prospective 
    payment system based on the principal diagnosis, up to eight additional 
    diagnoses, and up to six procedures performed during the stay, as well 
    as age, sex, and discharge status of the patient. The diagnosis and 
    procedure information is reported by the hospital using codes from the 
    International Classification of Diseases, Ninth Revision, Clinical 
    Modification (ICD-9-CM). The Medicare fiscal intermediary enters the 
    information into its claims system and subjects it to a series of 
    automated screens called the Medicare Code Editor (MCE). These screens 
    are designed to identify cases that require further review before 
    classification into a DRG can be accomplished.
        After screening through the MCE and any further development of the 
    claims, cases are classified by the GROUPER software program into the 
    appropriate DRG. The GROUPER program was developed as a means of 
    classifying each case into a DRG on the basis of the diagnosis and 
    procedure codes and demographic information (that is, sex, age, and 
    discharge status). It is used both to classify past cases in order to 
    measure relative hospital resource consumption to establish the DRG 
    weights and to classify current cases for purposes of determining 
    payment. The records for all Medicare hospital inpatient discharges are 
    maintained in the Medicare Provider Analysis and Review (MedPAR) file. 
    The data in this file are used to evaluate possible DRG classification 
    changes and to recalibrate the DRG weights.
        Currently, cases are assigned to one of 496 DRGs in 25 major 
    diagnostic categories (MDCs). Most MDCs are based on a particular organ 
    system of the body (for example, MDC 6, Diseases and Disorders of the 
    Digestive System); however, some MDCs are not constructed on this basis 
    since they involve multiple organ systems (for example, MDC 22, Burns).
        In general, cases are assigned to an MDC based on the principal 
    diagnosis, before assignment to a DRG. However, there are five DRGs to 
    which cases are directly assigned on the basis of procedure codes. 
    These are the DRGs for liver, bone marrow, and lung transplant (DRGs 
    480, 481, and 495, respectively) and the two DRGs for tracheostomies 
    (DRGs 482 and 483). Cases are assigned to these DRGs before 
    classification to an MDC.
        Within most MDCs, cases are then divided into surgical DRGs (based 
    on a surgical hierarchy that orders individual procedures or groups of 
    procedures by resource intensity) and medical DRGs. Medical DRGs 
    generally are differentiated on the basis of diagnosis and age. Some 
    surgical and medical DRGs are further differentiated based on the 
    presence or absence of complications or comorbidities (hereafter CC).
        Generally, GROUPER does not consider other procedures; that is, 
    nonsurgical procedures or minor surgical procedures generally not 
    performed in an operating room are not listed as operating room (OR) 
    procedures in the GROUPER decision tables. However, there are a few 
    non-OR procedures that do affect DRG assignment for certain principal 
    diagnoses, such as extracorporeal shock wave lithotripsy for patients 
    with a principal diagnosis of urinary stones.
        The changes we are proposing to make to the DRG classification 
    system for FY 1999 and other decisions concerning DRGs are set forth 
    below. Unless otherwise noted, our DRG analysis is based on the full 
    (100 percent) FY 1997 MedPAR file based on bills received through 
    September 1997.
    2. MDC 5 (Diseases and Disorders of the Circulatory System)
        In the August 29, 1997 hospital inpatient final rule with comment 
    period (62 FR 45974), we noted that, because of the many recent changes 
    in heart surgery, we were considering conducting a comprehensive review 
    of the MDC 5 surgical DRGs. We have begun that review, and based upon 
    our analysis thus far, we believe it is appropriate to propose some DRG 
    changes immediately. These proposed changes are set forth below.
        a. Coronary Bypass. There are two DRGs that capture coronary bypass 
    procedures: DRG 106 (Coronary Bypass with Cardiac Catheterization) and 
    DRG 107 (Coronary Bypass without Cardiac Catheterization). The 
    procedures that allow a coronary bypass case to be assigned to DRG 106 
    include percutaneous valvuloplasty, percutaneous transluminal coronary 
    angioplasty (PTCA), cardiac catheterization, coronary angiography, and 
    arteriography.
        In analyzing the FY 1997 MedPAR file, we noted that, of cases 
    assigned to DRG 106, the average standardized charges for coronary 
    bypass cases with PTCA were significantly higher than those cases 
    without PTCA. There were approximately 4,400 cases in DRG 106 where 
    PTCA is performed as a secondary procedure. These cases have an average 
    standardized charge of approximately $69,000. The average charge of the 
    approximately 95,000 cases in DRG 106 without PTCA is approximately 
    $52,000.
        Based on this analysis, we are proposing to create a new DRG for 
    coronary bypass cases with PTCA. The cases currently in DRG 106 without 
    PTCA would be assigned to another DRG and the cases currently assigned 
    to DRG 107 would be unmodified. Because we would replace two DRGs with 
    three new DRGs, we would revise the DRG numbers and titles accordingly. 
    The new DRGs and their titles are set forth below:
    
    DRG 106  Coronary Bypass with PTCA
    DRG 107  Coronary Bypass with Cardiac Catheterization
    DRG 109  Coronary Bypass without Cardiac Catheterization
    
        We note that DRG 109 has been an empty DRG for the last several 
    years.
        b. Implantable Heart Assist System and Annuloplasty. In the August 
    29, 1997 final rule with comment period, we moved implant of an 
    implantable, pulsatile heart assist system (procedure code 37.66) from 
    DRGs 110 and 111 (Major Cardiovascular Procedures) 1 to DRG 
    108 (Other Cardiothoracic Procedures). Although this move improved 
    payment for these procedures, they were still much more expensive than 
    the other cases in DRG 108 ($96,000 for heart assist versus an average 
    of $54,000 for all other cases in the FY 1996 MedPAR file). We stated 
    that we would continue to review the MDC 5 surgical DRGs in an attempt 
    to find a DRG placement for these cases that would be more similar in 
    terms of resource use.
    ---------------------------------------------------------------------------
    
        \1\ A single title combined with two DRG numbers is used to 
    signify pairs. Generally, the first DRG is for cases with CC and the 
    second DRG is for cases without CC. If a third number is included, 
    it represents cases with patients who are age 0-17. Occasionally, a 
    pair of DRGs is split between age >17 and age 0-17.
    ---------------------------------------------------------------------------
    
        In reviewing the FY 1997 MedPAR file, we note that heart assist 
    system implant continues to be the most expensive procedure in DRG 108. 
    In fact, other than heart transplant, heart assist system implant is 
    the most expensive procedure in MDC 5. The average FY 1997 charge for 
    these cases, when assigned to DRG 108, is over $150,000 compared to 
    about $53,000 for all cases in DRG 108. Obviously, the charges for 
    heart assist implant are increasing at a much greater rate than the 
    average charges for DRG 108. In addition, the length of stay for cases 
    coded with 37.66 is approximately 32 days compared to about 11 days for 
    all other DRG 108 cases.
    
    [[Page 25579]]
    
        One possibility for improving payment for these cases is to move 
    them to DRGs 104 and 105 (Cardiac Valve Procedures). Those DRGs, which 
    split on the basis of the performance of cardiac catheterization, have 
    average charges of approximately $66,000 and $51,000, respectively. 
    While heart assist implant cases are still more expensive than the 
    average case in these DRGs, payment would be improved. Clinically, 
    placement of heart assist implant in DRGs 104 and 105 is not without 
    precedent. Effective with FY 1988, we placed implant of a total 
    automatic implantable cardioverter defibrillator (AICD) in these DRGs. 
    In addition, the vast majority of procedures assigned to DRG 108 
    involve surgically splitting open the sternum to perform the procedure. 
    However, implant of the heart assist device does not require this 
    approach.
        While reviewing the DRG 108 cases, we also noted that procedure 
    code 35.33 (annuloplasty) is assigned to this DRG. Annuloplasty is a 
    valve procedure and is clinically more similar to the cases assigned to 
    DRGs 104 and 105 than it is to the cases assigned to DRG 108. In 
    addition, the average standardized charge for annuloplasty cases 
    assigned to DRG 108 is about $67,000, well above the overall average 
    charge of approximately $53,000 for cases in DRG 108. Therefore, we are 
    proposing to move annuloplasty from DRG 108 to DRGs 104 and 105.
        In order to more accurately reflect the cases assigned to DRGs 104 
    and 105, we would retitle them as follows:
    
    DRG 104  Cardiac Valve and Other Major Cardiothoracic Procedures 
    with Cardiac Catheterization
    DRG 105  Cardiac Valve and Other Major Cardiothoracic Procedures 
    without Cardiac Catheterization.
    3. MDC 22 (Burns)
        Under the current DRG system, burn cases are assigned to one of six 
    DRGs in MDC 22 (Burns), which have not been revised since 1986. In our 
    FY 1998 hospital inpatient proposed rule (June 2, 1997; 62 FR 29912), 
    in response to inquiries we had received, we indicated that we would 
    conduct a comprehensive review of MDC 22 to determine whether changes 
    in these DRGs could more appropriately capture the variation in 
    resource use associated with different classes of burn patients. We 
    solicited public comments on this issue, particularly asking for 
    recommendations on ways to categorize related diagnosis and procedure 
    codes to produce DRG groupings that would be more homogeneous in terms 
    of resource use.
        Among the comments we received was a proposal (endorsed by the 
    American Burn Association (ABA)) for restructuring the DRGs based on 
    several statistical and clinical criteria, including age, severity of 
    the burn, and the presence of complications or comorbidities. Although 
    this proposal was structured for a patient population encompassing all 
    ages of patients, we believed that it showed great promise for Medicare 
    patients as well. During the last several months, we have worked 
    closely with representatives of the ABA and with the clinicians who 
    developed the proposal in order to refine it for Medicare purposes.
        Based on this work, we are proposing a new set of DRGs for burn 
    cases. Under this proposal, we would replace the six existing DRGs in 
    MDC 22 with eight new DRGs. For ease of reference and classification, 
    the current DRGs in MDC 22, DRGs 456 through 460 and 472, would no 
    longer be valid, and we would establish new DRGs 504 through 511 to 
    contain all cases that currently group to MDC 22. (The complete titles 
    of the new DRGs are set forth below.)
        In reviewing the Medicare burn cases, we found that the most 
    important distinguishing characteristic in terms of resource use was 
    the amount of body surface affected by the burn and how much of that 
    burn was a 3rd degree burn. The second most important factor was 
    whether or not the patient received a skin graft. Thus, a patient with 
    burns covering at least 20 percent of body area, with at least 10 
    percent of that a 3rd degree burn, consumed the most resources. 
    However, if a patient met these criteria and did not receive a skin 
    graft, then the case was much less expensive and the average length of 
    stay fell from over 30 days to 8 days. The first two proposed burn DRGs 
    would reflect these distinctions (DRGs 504 and 505).
        After classifying the most extensive burn cases, we found that the 
    patients with 3rd degree burns that did not meet the criteria to be 
    assigned to DRGs 504 and 505 were the most expensive of the remaining 
    cases (that is, those patients whose burns that did not meet the at 
    least 20 percent body area or at least 10 percent 3rd degree criteria). 
    These burns are referred to clinically as ``full-thickness burns.'' A 
    subset of these full-thickness burn cases, those with skin graft or an 
    inhalation injury, were much more expensive than the other cases. After 
    dividing these patients into two groups, with or without skin graft or 
    inhalation injury, we examined whether other factors had an influence 
    on resource use. We found that patients who had a CC (complication or 
    comorbidity) or a concomitant significant trauma consumed more 
    resources whether or not they had a skin graft or inhalation injury. 
    Thus, the next four DRGs were defined as full-thickness burns with skin 
    graft or inhalation injury with or without CC or significant trauma, or 
    full-thickness burns without skin graft or inhalation injury with or 
    without CC or significant trauma (DRGs 506 through 509).
        Finally, the last two proposed DRGs (510 and 511) are for cases 
    with nonextensive burns. These cases are also split on the basis of CCs 
    or concomitant significant trauma.
        Consistent with the recommendations of several commenters on last 
    year's proposed rule, the new burn DRGs would no longer include a 
    separate DRG for cases in which burn patients were transferred to 
    another acute care facility. Overall, we estimate that these proposed 
    changes would increase by more than 25 percent the amount of variation 
    in resource use explained by the DRGs in MDC 22. They would also 
    improve the clinical coherence of the cases within each DRG. Thus, we 
    believe that the proposed DRGs would provide for improved payment for 
    cases assigned to MDC 22.
        The specific diagnosis and procedure codes that would be included 
    in each of the eight DRGs and their titles are as follows:
    
    DRGs 504 and 505--Extensive 3rd Degree Burns with and without Skin 
    Graft
    
        DRGs 504 and 505 would include all cases with burns involving at 
    least 20 percent of body surface area combined with a 3rd degree burn 
    covering at least 10 percent of body surface area. Thus, these cases 
    would have diagnosis codes of 948.xx, with a fourth digit of 2 or 
    higher (indicating that burn extends over 20 percent or more of body 
    surface) and a fifth digit of 1 or higher (indicating a 3rd degree burn 
    extending over 10 percent or more of body surface). Cases with the 
    appropriate diagnosis codes would be classified into DRG 504 if one of 
    the following skin graft procedure codes is present:
    
    85.82  Split-thickness graft to breast
    85.83  Full-thickness graft to breast
    85.84  Pedicle graft to breast
    86.60  Free skin graft, NOS
    86.61  Full-thickness skin graft to hand
    86.62  Other skin graft to hand
    86.63  Full-thickness skin graft to other sites
    86.65  Heterograft to skin
    86.66  Homograft to skin
    86.67  Dermal regenerative graft (new code in FY 1999--see Table 6A 
    in section V. of the Addendum)
    86.69  Other skin graft to other sites
    86.70  Pedicle of flap graft, NOS
    
    [[Page 25580]]
    
    86.71  Cutting and preparation of pedicle grafts or flaps
    86.72  Advancement of pedicle graft
    86.73  Attachment of pedicle or flap graft to hand
    86.74  Attachment of pedicle or flap graft to other sites
    86.75  Revision of pedicle or flap graft
    86.93  Insertion of tissue expander
    
    DRGs 506 and 507--Full Thickness Burn with Skin Graft or Inhalation 
    Injury with or without CC or Significant Trauma
    
        These DRGs would include all other cases of 3rd degree burns that 
    also have either a skin graft or an inhalation injury. Thus, these 
    cases would have diagnosis codes of 941.xx through 946.xx, and 949.xx, 
    with a fourth digit of 3 or higher, as well as cases with codes of 
    948.xx that did not group into DRGs 504 or 505 (that is, 948.00, 
    948.01, and 948.1x through 948.9x with a fifth digit of 0). In 
    addition, cases classified into DRGs 506 and 507 must have either one 
    of the skin graft procedure codes listed above or one of the following 
    diagnosis codes for inhalation injuries:
    
    518.5  Pulmonary insufficiency following trauma and surgery
    518.81  Respiratory failure
    518.84  Acute and chronic respiratory failure (new code in FY 1999--
    see Table 6A in section V. of the Addendum)
    947.1 Burn of larynx, trachea, or lung
    987.9  Toxic effect of gas, fume, or vapor, NOS
    
        Cases that meet both of these coding criteria would be assigned to 
    DRG 506 if there is a diagnosis code indicating either a CC (based on 
    the standard DRG CC list) or concomitant significant trauma (based on 
    the significant trauma diagnosis codes, listed by body site, used for 
    classification in MDC 24).
    
    DRGs 508 and 509--Full Thickness Burn without Skin Graft or Inhalation 
    Injury with or without CC or Significant Trauma
    
        These DRGs would include all other cases of 3rd degree burns. Thus, 
    these DRGs would include all cases without a skin graft or inhalation 
    injury that have diagnosis codes of 941.xx through 946.xx, and 949.xx, 
    with a fourth digit of 3 or higher, as well as cases with codes of 
    948.xx that did not group into DRGs 504 or 505. DRG 508 would also 
    require a secondary diagnosis from the standard CC list or the trauma 
    list based on the significant trauma diagnosis codes, listed by body 
    site, used for classification in MDC 24.
    
    DRGs 510 and 511--Nonextensive Burns with and without CC or Significant 
    Trauma
    
        The remaining burn cases would be classified into one of these two 
    DRGs, depending on whether or not the claim included a diagnosis code 
    reflecting the presence of a CC or a significant trauma, as explained 
    above.
    4. Legionnaires' Disease
        Effective with discharges occurring on or after October 1, 1997, a 
    new diagnosis code was created for pneumonia due to Legionnaires' 
    disease (code 482.84). In the August 29, 1997 final rule with comment 
    period, we assigned this code to DRGs 79, 80, and 81 (Respiratory 
    Infections and Inflammations) (62 FR 46090). However, we did not 
    include this code as a human immunodeficiency virus (HIV) major related 
    condition in MDC 25 (HIV Infections). Because pneumonia due to 
    Legionnaires' disease is a serious respiratory condition that has a 
    deleterious effect on patients with HIV, we are proposing to assign 
    diagnosis code 482.84 to DRG 489 (HIV with Major Related Condition) as 
    a major related condition. In addition, we did not assign the code as a 
    major problem in DRGs 387 (Prematurity with Major Problems) and 389 
    (Full Term Neonate with Major Problems). These DRGs are assigned to MDC 
    15 (Newborns and Other Neonates with Conditions Originating in the 
    Perinatal Period). Again, as a part of this proposed rule, we would 
    assign diagnosis code 482.84 as a major problem in DRGs 387 and 389 
    because of its effect on resource use in treating newborns.
    5. Surgical Hierarchies
        Some inpatient stays entail multiple surgical procedures, each one 
    of which, occurring by itself, could result in assignment of the case 
    to a different DRG within the MDC to which the principal diagnosis is 
    assigned. It is, therefore, necessary to have a decision rule by which 
    these cases are assigned to a single DRG. The surgical hierarchy, an 
    ordering of surgical classes from most to least resource intensive, 
    performs that function. Its application ensures that cases involving 
    multiple surgical procedures are assigned to the DRG associated with 
    the most resource-intensive surgical class.
        Because the relative resource intensity of surgical classes can 
    shift as a function of DRG reclassification and recalibration, we 
    reviewed the surgical hierarchy of each MDC, as we have for previous 
    reclassifications, to determine if the ordering of classes coincided 
    with the intensity of resource utilization, as measured by the same 
    billing data used to compute the DRG relative weights.
        A surgical class can be composed of one or more DRGs. For example, 
    in MDC 5, the surgical class ``heart transplant'' consists of a single 
    DRG (DRG 103) and the class ``major cardiovascular procedures'' 
    consists of two DRGs (DRGs 110 and 111). Consequently, in many cases, 
    the surgical hierarchy has an impact on more than one DRG. The 
    methodology for determining the most resource-intensive surgical class 
    involves weighting each DRG for frequency to determine the average 
    resources for each surgical class. For example, assume surgical class A 
    includes DRGs 1 and 2 and surgical class B includes DRGs 3, 4, and 5. 
    Assume also that the average charge of DRG 1 is higher than that of DRG 
    3, but the average charges of DRGs 4 and 5 are higher than the average 
    charge of DRG 2. To determine whether surgical class A should be higher 
    or lower than surgical class B in the surgical hierarchy, we would 
    weight the average charge of each DRG by frequency (that is, by the 
    number of cases in the DRG) to determine average resource consumption 
    for the surgical class. The surgical classes would then be ordered from 
    the class with the highest average resource utilization to that with 
    the lowest, with the exception of ``other OR procedures'' as discussed 
    below.
        This methodology may occasionally result in a case involving 
    multiple procedures being assigned to the lower-weighted DRG (in the 
    highest, most resource-intensive surgical class) of the available 
    alternatives. However, given that the logic underlying the surgical 
    hierarchy provides that the GROUPER searches for the procedure in the 
    most resource-intensive surgical class this result is unavoidable.
        We note that, notwithstanding the foregoing discussion, there are a 
    few instances when a surgical class with a lower average relative 
    weight is ordered above a surgical class with a higher average relative 
    weight. For example, the ``other OR procedures'' surgical class is 
    uniformly ordered last in the surgical hierarchy of each MDC in which 
    it occurs, regardless of the fact that the relative weight for the DRG 
    or DRGs in that surgical class may be higher than that for other 
    surgical classes in the MDC. The ``other OR procedures'' class is a 
    group of procedures that are least likely to be related to the 
    diagnoses in the MDC but are occasionally performed on patients with 
    these diagnoses. Therefore, these procedures should only be considered 
    if
    
    [[Page 25581]]
    
    no other procedure more closely related to the diagnoses in the MDC has 
    been performed.
        A second example occurs when the difference between the average 
    weights for two surgical classes is very small. We have found that 
    small differences generally do not warrant reordering of the hierarchy 
    since, by virtue of the hierarchy change, the relative weights are 
    likely to shift such that the higher-ordered surgical class has a lower 
    average weight than the class ordered below it.
        Based on the preliminary recalibration of the DRGs, we are 
    proposing to modify the surgical hierarchy as set forth below. As we 
    stated in the September 1, 1989 final rule (54 FR 36457), we are unable 
    to test the effects of the proposed revisions to the surgical hierarchy 
    and to reflect these changes in the proposed relative weights due to 
    the unavailability of revised GROUPER software at the time this 
    proposed rule is prepared. Rather, we simulate most major 
    classification changes to approximate the placement of cases under the 
    proposed reclassification and then determine the average charge for 
    each DRG. These average charges then serve as our best estimate of 
    relative resource use for each surgical class. We test the proposed 
    surgical hierarchy changes after the revised GROUPER is received and 
    reflect the final changes in the DRG relative weights in the final 
    rule. Further, as discussed below in section II.C of this preamble, we 
    anticipate that the final recalibrated weights will be somewhat 
    different from those proposed, since they will be based on more 
    complete data. Consequently, further revision of the hierarchy, using 
    the above principles, may be necessary in the final rule.
        At this time, we would revise the surgical hierarchy for MDC 3 
    (Diseases and Disorders of the Ear, Nose, Mouth and Throat) as follows:
         We would reorder Sinus and Mastoid Procedures (DRGs 53-54) 
    above Myringotomy with Tube Insertion (DRGs 61-62).
         We would reorder Mouth Procedures (DRGs 168-169) above 
    Tonsil and Adenoid Procedure Except Tonsillectomy and/or Adeniodectomy 
    Only (DRGs 57-58).
    6. Refinement of Complications and Comorbidities List
        There is a standard list of diagnoses that are considered CCs. We 
    developed this list using physician panels to include those diagnoses 
    that, when present as a secondary condition, would be considered a 
    substantial complication or comorbidity. In previous years, we have 
    made changes to the standard list of CCs, either by adding new CCs or 
    deleting CCs already on the list. At this time, we do not propose to 
    delete any of the diagnosis codes on the CC list.
        In the September 1, 1987 final notice concerning changes to the DRG 
    classification system (52 FR 33143), we modified the GROUPER logic so 
    that certain diagnoses included on the standard list of CCs would not 
    be considered a valid CC in combination with a particular principal 
    diagnosis. Thus, we created the CC Exclusions List. We made these 
    changes to preclude coding of CCs for closely related conditions, to 
    preclude duplicative coding or inconsistent coding from being treated 
    as CCs, and to ensure that cases are appropriately classified between 
    the complicated and uncomplicated DRGs in a pair.
        In the May 19, 1987 proposed notice concerning changes to the DRG 
    classification system (52 FR 18877), we explained that the excluded 
    secondary diagnoses were established using the following five 
    principles:
         Chronic and acute manifestations of the same condition 
    should not be considered CCs for one another (as subsequently corrected 
    in the September 1, 1987 final notice (52 FR 33154)).
         Specific and nonspecific (that is, not otherwise specified 
    (NOS)) diagnosis codes for a condition should not be considered CCs for 
    one another.
         Conditions that may not co-exist, such as partial/total, 
    unilateral/bilateral, obstructed/unobstructed, and benign/malignant, 
    should not be considered CCs for one another.
         The same condition in anatomically proximal sites should 
    not be considered CCs for one another.
         Closely related conditions should not be considered CCs 
    for one another.
        The creation of the CC Exclusions List was a major project 
    involving hundreds of codes. The FY 1988 revisions were intended to be 
    only a first step toward refinement of the CC list in that the criteria 
    used for eliminating certain diagnoses from consideration as CCs were 
    intended to identify only the most obvious diagnoses that should not be 
    considered complications or comorbidities of another diagnosis. For 
    that reason, and in light of comments and questions on the CC list, we 
    have continued to review the remaining CCs to identify additional 
    exclusions and to remove diagnoses from the master list that have been 
    shown not to meet the definition of a CC. (See the September 30, 1988 
    final rule for the revision made for the discharges occurring in FY 
    1989 (53 FR 38485); the September 1, 1989 final rule for the FY 1990 
    revision (54 FR 36552); the September 4, 1990 final rule for the FY 
    1991 revision (55 FR 36126); the August 30, 1991 final rule for the FY 
    1992 revision (56 FR 43209); the September 1, 1992 final rule for the 
    FY 1993 revision (57 FR 39753); the September 1, 1993 final rule for 
    the FY 1994 revisions (58 FR 46278); the September 1, 1994 final rule 
    for the FY 1995 revisions (59 FR 45334); the September 1, 1995 final 
    rule for the FY 1996 revisions (60 FR 45782); the August 30, 1996 final 
    rule for the FY 1997 revisions (61 FR 46171); and the August 29, 1997 
    final rule for the FY 1998 revisions (62 FR 45966)).
        We are proposing a limited revision of the CC Exclusions List to 
    take into account the changes that will be made in the ICD-9-CM 
    diagnosis coding system effective October 1, 1998. (See section II.B.8, 
    below, for a discussion of ICD-9-CM changes.) These proposed changes 
    are being made in accordance with the principles established when we 
    created the CC Exclusions List in 1987.
        Tables 6F and 6G in section V. of the Addendum to this proposed 
    rule contain the proposed revisions to the CC Exclusions List that 
    would be effective for discharges occurring on or after October 1, 
    1998. Each table shows the principal diagnoses with proposed changes to 
    the excluded CCs. Each of these principal diagnoses is shown with an 
    asterisk and the additions or deletions to the CC Exclusions List are 
    provided in an indented column immediately following the affected 
    principal diagnosis.
        CCs that are added to the list are in Table 6F--Additions to the CC 
    Exclusions List. Beginning with discharges on or after October 1, 1998, 
    the indented diagnoses will not be recognized by the GROUPER as valid 
    CCs for the asterisked principal diagnosis.
        CCs that are deleted from the list are in Table 6G--Deletions from 
    the CC Exclusions List. Beginning with discharges on or after October 
    1, 1998 the indented diagnoses will be recognized by the GROUPER as 
    valid CCs for the asterisked principal diagnosis.
        Copies of the original CC Exclusions List applicable to FY 1988 can 
    be obtained from the National Technical Information Service (NTIS) of 
    the Department of Commerce. It is available in hard copy for $92.00 
    plus $6.00 shipping and handling and on microfiche for $20.50, plus 
    $4.00 for shipping and handling. A request for the FY 1988 CC 
    Exclusions List (which
    
    [[Page 25582]]
    
    should include the identification accession number (PB) 88-133970) 
    should be made to the following address: National Technical Information 
    Service; United States Department of Commerce; 5285 Port Royal Road; 
    Springfield, Virginia 22161; or by calling (703) 487-4650.
        Users should be aware of the fact that all revisions to the CC 
    Exclusions List (FYs 1989, 1990, 1991, 1992, 1993, 1994, 1995, 1996, 
    1997, and 1998) and those in Tables 6F and 6G of this document must be 
    incorporated into the list purchased from NTIS in order to obtain the 
    CC Exclusions List applicable for discharges occurring on or after 
    October 1, 1998.
        Alternatively, the complete documentation of the GROUPER logic, 
    including the current CC Exclusions List, is available from 3M/Health 
    Information Systems (HIS), which, under contract with HCFA, is 
    responsible for updating and maintaining the GROUPER program. The 
    current DRG Definitions Manual, Version 15.0, is available for $195.00, 
    which includes $15.00 for shipping and handling. Version 16.0 of this 
    manual, which will include the final FY 1999 DRG changes, will be 
    available in October 1998 for $225.00. These manuals may be obtained by 
    writing 3M/HIS at the following address: 100 Barnes Road; Wallingford, 
    Connecticut 06492; or by calling (203) 949-0303. Please specify the 
    revision or revisions requested.
    7. Review of Procedure Codes in DRGs 468, 476, and 477
        Each year, we review cases assigned to DRG 468 (Extensive OR 
    Procedure Unrelated to Principal Diagnosis), DRG 476 (Prostatic OR 
    Procedure Unrelated to Principal Diagnosis), and DRG 477 (Nonextensive 
    OR Procedure Unrelated to Principal Diagnosis) in order to determine 
    whether it would be appropriate to change the procedures assigned among 
    these DRGs.
        DRGs 468, 476, and 477 are reserved for those cases in which none 
    of the OR procedures performed is related to the principal diagnosis. 
    These DRGs are intended to capture atypical cases, that is, those cases 
    not occurring with sufficient frequency to represent a distinct, 
    recognizable clinical group. DRG 476 is assigned to those discharges in 
    which one or more of the following prostatic procedures are performed 
    and are unrelated to the principal diagnosis:
    
    60.0  Incision of prostate
    60.12  Open biopsy of prostate
    60.15  Biopsy of periprostatic tissue
    60.18  Other diagnostic procedures on prostate and periprostatic 
    tissue
    60.21  Transurethral prostatectomy
    60.29  Other transurethral prostatectomy
    60.61  Local excision of lesion of prostate
    60.69  Prostatectomy NEC
    60.81  Incision of periprostatic tissue
    60.82  Excision of periprostatic tissue
    60.93  Repair of prostate
    60.94  Control of (postoperative) hemorrhage of prostate
    60.95  Transurethral balloon dilation of the prostatic urethra
    60.99  Other operations on prostate
    
        All remaining OR procedures are assigned to DRGs 468 and 477, with 
    DRG 477 assigned to those discharges in which the only procedures 
    performed are nonextensive procedures that are unrelated to the 
    principal diagnosis. The original list of the ICD-9-CM procedure codes 
    for the procedures we consider nonextensive procedures, if performed 
    with an unrelated principal diagnosis, was published in Table 6C in 
    section IV. of the Addendum to the September 30, 1988 final rule (53 FR 
    38591). As part of the final rules published on September 4, 1990, 
    August 30, 1991, September 1, 1992, September 1, 1993, September 1, 
    1994, September 1, 1995, August 30, 1996, and August 29, 1997, we moved 
    several other procedures from DRG 468 to 477, as well as moving some 
    procedures from DRG 477 to 468. (See 55 FR 36135, 56 FR 43212, 57 FR 
    23625, 58 FR 46279, 59 FR 45336, 60 FR 45783, 61 FR 46173, and 62 FR 
    45981, respectively.)
        a. Adding Procedure Codes to MDCs. We annually conduct a review of 
    procedures producing DRG 468 or 477 assignments on the basis of volume 
    of cases in these DRGs with each procedure. Our medical consultants 
    then identify those procedures occurring in conjunction with certain 
    principal diagnoses with sufficient frequency to justify adding them to 
    one of the surgical DRGs for the MDC in which the diagnosis falls. 
    Based on this year's review, we did not identify any necessary changes; 
    therefore, we are not proposing to move any procedures from DRGs 468 
    and 477 to one of the surgical DRGs.
         b. Reassignment of Procedures Among DRGs 468, 476, and 477. We 
    also reviewed the list of procedures that produce assignments to DRGs 
    468, 476, and 477 to ascertain if any of those procedures should be 
    moved from one of these DRGs to another based on average charges and 
    length of stay. Generally, we move only those procedures for which we 
    have an adequate number of discharges to analyze the data. Based on our 
    review this year, we are not proposing to move any procedures from DRG 
    468 to DRGs 476 or 477, from DRG 476 to DRGs 468 or 477, or from DRG 
    477 to DRGS 468 or 476.
    8. Changes to the ICD-9-CM Coding System
        As discussed above in section II.B.1 of this preamble, the ICD-9-CM 
    is a coding system that is used for the reporting of diagnoses and 
    procedures performed on a patient. In September 1985, the ICD-9-CM 
    Coordination and Maintenance Committee was formed. This is a Federal 
    interdepartmental committee charged with the mission of maintaining and 
    updating the ICD-9-CM. That mission includes approving coding changes, 
    and developing errata, addenda, and other modifications to the ICD-9-CM 
    to reflect newly developed procedures and technologies and newly 
    identified diseases. The Committee is also responsible for promoting 
    the use of Federal and non-Federal educational programs and other 
    communication techniques with a view toward standardizing coding 
    applications and upgrading the quality of the classification system.
        The Committee is co-chaired by the National Center for Health 
    Statistics (NCHS) and HCFA. The NCHS has lead responsibility for the 
    ICD-9-CM diagnosis codes included in the Tabular List and Alphabetic 
    Index for Diseases while HCFA has lead responsibility for the ICD-9-CM 
    procedure codes included in the Tabular List and Alphabetic Index for 
    Procedures.
        The Committee encourages participation in the above process by 
    health-related organizations. In this regard, the Committee holds 
    public meetings for discussion of educational issues and proposed 
    coding changes. These meetings provide an opportunity for 
    representatives of recognized organizations in the coding fields, such 
    as the American Health Information Management Association (AHIMA) 
    (formerly American Medical Record Association (AMRA)), the American 
    Hospital Association (AHA), and various physician specialty groups as 
    well as physicians, medical record administrators, health information 
    management professionals, and other members of the public to contribute 
    ideas on coding matters. After considering the opinions expressed at 
    the public meetings and in writing, the Committee formulates 
    recommendations, which then must be approved by the agencies.
        The Committee presented proposals for coding changes at public 
    meetings held on June 5 and December 4 and 5, 1997, and finalized the 
    coding changes after consideration of comments received at the meetings 
    and in writing
    
    [[Page 25583]]
    
    within 30 days following the December 1997 meeting. The initial meeting 
    for consideration of coding issues for implementation in FY 2000 will 
    be held on June 4, 1998. Copies of the minutes of the 1997 meetings can 
    be obtained from the HCFA Home Page @ http://www.hcfa.gov/pubaffr.htm, 
    under the ``What's New'' listing. Paper copies of these minutes are no 
    longer available and the mailing list has been discontinued. We 
    encourage commenters to address suggestions on coding issues involving 
    diagnosis codes to: Donna Pickett, Co-Chairperson; ICD-9-CM 
    Coordination and Maintenance Committee; NCHS; Room 1100; 6525 Belcrest 
    Road; Hyattsville, Maryland 20782. Comments may be sent by E-mail to: 
    dfp4@cdc.gov.
        Questions and comments concerning the procedure codes should be 
    addressed to: Patricia E. Brooks, Co-Chairperson; ICD-9-CM Coordination 
    and Maintenance Committee; HCFA, Center for Health Plans and Providers, 
    Plan and Provider Purchasing Policy Group, Division of Acute Care; C5-
    06-27; 7500 Security Boulevard; Baltimore, Maryland 21244-1850. 
    Comments may be sent by E-mail to: pbrooks@hcfa.gov.
        The ICD-9-CM code changes that have been approved will become 
    effective October 1, 1998. The new ICD-9-CM codes are listed, along 
    with their proposed DRG classifications, in Tables 6A and 6B (New 
    Diagnosis Codes and New Procedure Codes, respectively) in section V. of 
    the Addendum to this proposed rule. As we stated above, the code 
    numbers and their titles were presented for public comment in the ICD-
    9-CM Coordination and Maintenance Committee meetings. Both oral and 
    written comments were considered before the codes were approved. 
    Therefore, we are soliciting comments only on the proposed DRG 
    classifications.
        Further, the Committee has approved the expansion of certain ICD-9-
    CM codes to require an additional digit for valid code assignment. 
    Diagnosis codes that have been replaced by expanded codes, other codes, 
    or have been deleted are in Table 6C (Invalid Diagnosis Codes). These 
    invalid diagnosis codes will not be recognized by the GROUPER beginning 
    with discharges occurring on or after October 1, 1998. The 
    corresponding new or expanded diagnosis codes are included in Table 6A. 
    Procedure codes that have been replaced by expanded codes, other codes, 
    or have been deleted are in Table 6D (Invalid Procedure Codes). 
    Revisions to diagnosis code titles are in Table 6E (Revised Diagnosis 
    Code Titles), which also include the proposed DRG assignments for these 
    revised codes. For FY 1999, there are no revisions to procedure code 
    titles.
    9. Other Issues--
        a. Palliative Care. Effective October 1, 1996 (FY 1997), we 
    introduced a diagnosis code to allow the identification of those cases 
    in which palliative care was delivered to a hospital inpatient. This 
    code, V66.7 (Encounter for palliative care), was unusual in that there 
    had been no previous code assignment that included the concept of 
    palliative care. Since this was a new concept, instructional materials 
    were developed and distributed by the AHA as well as specialty groups 
    on the use of this new code. With new codes, it sometimes takes several 
    years for physician documentation to improve and for coders to become 
    accustomed to looking for this type of information in order to assign a 
    code. There is an inclusion note listed under V66.7 which indicates 
    that this code should be used as a secondary diagnosis only; the 
    patient's medical problem would always be listed first. Currently, use 
    of diagnosis code V66.7 does not have an impact on DRG assignment. 
    Consistent with prior practice, we have waited until the FY 1997 data 
    became available for analysis before considering any possible 
    modifications to the DRGs.
        In analyzing the FY 1997 bills received through September 1997, we 
    found that 4,769 discharges included V66.7 as a secondary diagnosis. 
    These cases were widely distributed throughout 199 DRGs. The vast 
    majority of these DRGs included five or fewer discharges with use of 
    palliative care. Only 12 DRGs included more than 100 cases. These were 
    the following:
    
    
    ------------------------------------------------------------------------
                                                                  Number of 
                   DRG                           Title              cases   
    ------------------------------------------------------------------------
    10...............................  Nervous System Neoplasms          144
                                        with CC.                            
    14...............................  Specific Cerebrovascular          272
                                        Disorders Except TIA.               
    79...............................  Respiratory Infections            139
                                        and Inflammations Age               
                                        >17 with CC.                        
    82...............................  Respiratory Neoplasms...          526
    89...............................  Simple Pneumonia and              200
                                        Pleurisy Age >17 with               
                                        CC.                                 
    127..............................  Heart Failure and Shock.          184
    172..............................  Digestive Malignancy              226
                                        with CC.                            
    203..............................  Malignancy of                     285
                                        Hepatobiliary System or             
                                        Pancreas.                           
    239..............................  Pathological Fractures            218
                                        and Musculoskeletal and             
                                        Connective Tissue                   
                                        Malignancy.                         
    296..............................  Nutritional and                   173
                                        Miscellaneous Metabolic             
                                        Disorders Age >17 with              
                                        CC.                                 
    403..............................  Lymphoma and Non-Acute            178
                                        Leukemia with CC.                   
    416..............................  Septicemia Age >17......          147
    ------------------------------------------------------------------------
    
        Six of these DRGs are cancer-related; however, the other DRGs are 
    quite diverse. Upon further analysis, we found that, for the most part, 
    discharges with code V66.7 do not significantly differ in length of 
    stay from the discharges in the same DRG without code V66.7. Discharges 
    with code V66.7 are sometimes longer and sometimes shorter and the 
    comparative length of stay for a given DRG tends to vary by only one 
    day. In general, the average charges for a palliative care case 
    discharge with a secondary code of V66.7 were lower than the charges 
    for other discharges within the DRG. However, these differences were 
    relatively small and were well within the standard variation of charges 
    for cases in the DRG.
        One approach we could take to revise the DRGs would be to divide 
    those DRGs with a large number of cases coded with V66.7 into two 
    different DRGs, with and without palliative care. However, the 
    relatively small proportion of cases in each DRG argues against this 
    approach; no DRG has more than 1 percent of its cases coded with 
    palliative care and, in most cases, the percentage is well under 1 
    percent. An alternative approach would be to group all palliative care 
    cases, regardless of the underlying disease or condition, into one new 
    DRG. However, the charges of these cases are so varied that this is not 
    a logical choice. In addition, there is a lack of clinical coherence in 
    such an approach. The underlying diagnoses of
    
    [[Page 25584]]
    
    these cases range from respiratory conditions to heart failure to 
    septicemia. Because there are so few cases in the FY 1997 data and they 
    are so widely dispersed among different DRGs, we are not proposing a 
    DRG modification at this time. We will make a more detailed analysis of 
    these cases over the next year based on a more complete FY 1997 data 
    file as well as review of the FY 1998 cases that will be available 
    later this year. As time goes by, hospital coders and physicians should 
    become more aware of this code and we hope that more complete data will 
    assist our decision making process.
        b. PTCA. Effective with discharges occurring on or after October 1, 
    1997, we reassigned cases of PTCA with coronary artery stent implant 
    from DRG 112 to DRG 116. In the August 29, 1997 final rule with comment 
    period, we responded to several commenters who contended that PTCA 
    cases treated with platelet inhibitors were as resource intensive as 
    the PTCA with stent implant cases and that these cases should also be 
    moved to DRG 116. However, there is currently no code that describes 
    the infusion of platelet inhibitors. Therefore, we were unable to make 
    any changes in the DRGs for FY 1998.
        As set forth in Table 6B, New Procedure Codes in section V. of the 
    addendum to this proposed rule, a new procedure code for injection or 
    infusion of platelet inhibitors (code 99.20) will be effective with 
    discharges occurring on or after October 1, 1998. Our usual policy on 
    new codes is to assign them to the same DRG or DRGs as their 
    predecessor code. Because infusion of platelet inhibitors is currently 
    assigned to a non-OR procedure code, we followed our usual practice and 
    designated code 99.20 as a non-OR code that does not affect DRG 
    assignment.
        We will not have any data on this new code until we receive bills 
    for FY 1999. Thus, we would be unable to make any changes in DRG 
    assignment until FY 2001. We note, however, that the Conference Report 
    that accompanied the Balanced Budget Act of 1997 contained language 
    stating that ``* * * in order to ensure that Medicare beneficiaries 
    have access to innovative new drug therapies, the Conferees believe 
    that HCFA should consider, to the extent feasible, reliable, validated 
    data other than MedPAR data in annually recalibrating and reclassifying 
    the DRGs.'' (H.R. Rep. No. 105-217.734). At this time, we have received 
    no data that would allow us to make an appropriate modification of DRG 
    112 for PTCA cases with platelet infusion therapy. When we develop the 
    final rule, we will review and analyze any data we receive about the 
    use of platelet inhibitors for Medicare beneficiaries. If we believe 
    that the data are adequate to allow identification of the percentage of 
    cases in DRG 112 that receive this therapy and the charge and length of 
    stay data convince us that these cases should be moved, we will 
    consider such a move effective for discharges occurring on or after 
    October 1, 1998.
    
    C. Recalibration of DRG Weights
    
        We are proposing to use the same basic methodology for the FY 1999 
    recalibration as we did for FY 1998. (See the August 29, 1997 final 
    rule with comment (62 FR 45982).) That is, we would recalibrate the 
    weights based on charge data for Medicare discharges. However, we would 
    use the most current charge information available, the FY 1997 MedPAR 
    file, rather than the FY 1996 MedPAR file. The MedPAR file is based on 
    fully-coded diagnostic and surgical procedure data for all Medicare 
    inpatient hospital bills.
        The proposed recalibrated DRG relative weights are constructed from 
    FY 1997 MedPAR data, based on bills received by HCFA through December 
    1997, from all hospitals subject to the prospective payment system and 
    short-term acute care hospitals in waiver States. The FY 1997 MedPAR 
    file includes data for approximately 11.2 million Medicare discharges.
        The methodology used to calculate the proposed DRG relative weights 
    from the FY 1997 MedPAR file is as follows:
         To the extent possible, all the claims were regrouped 
    using the proposed DRG classification revisions discussed above in 
    section II.B of this preamble. As noted in section II.B.5, due to the 
    unavailability of revised GROUPER software, we simulate most major 
    classification changes to approximate the placement of cases under the 
    proposed reclassification. However, there are some changes that cannot 
    be modeled.
         Charges were standardized to remove the effects of 
    differences in area wage levels, indirect medical education costs, 
    disproportionate share payments, and, for hospitals in Alaska and 
    Hawaii, the applicable cost-of-living adjustment.
         The average standardized charge per DRG was calculated by 
    summing the standardized charges for all cases in the DRG and dividing 
    that amount by the number of cases classified in the DRG.
         We then eliminated statistical outliers, using the same 
    criteria as was used in computing the current weights. That is, all 
    cases that are outside of 3.0 standard deviations from the mean of the 
    log distribution of both the charges per case and the charges per day 
    for each DRG.
         The average charge for each DRG was then recomputed 
    (excluding the statistical outliers) and divided by the national 
    average standardized charge per case to determine the relative weight. 
    A transfer case is counted as a fraction of a case based on the ratio 
    of its length of stay to the geometric mean length of stay of the cases 
    assigned to the DRG. That is, a 5-day length of stay transfer case 
    assigned to a DRG with a geometric mean length of stay of 10 days is 
    counted as 0.5 of a total case.
         We established the relative weight for heart and heart-
    lung, liver, and lung transplants (DRGs 103, 480, and 495) in a manner 
    consistent with the methodology for all other DRGs except that the 
    transplant cases that were used to establish the weights were limited 
    to those Medicare-approved heart, heart-lung, liver, and lung 
    transplant centers that have cases in the FY 1995 MedPAR file. 
    (Medicare coverage for heart, heart-lung, liver, and lung transplants 
    is limited to those facilities that have received approval from HCFA as 
    transplant centers.)
         Acquisition costs for kidney, heart, heart-lung, liver, 
    and lung transplants continue to be paid on a reasonable cost basis. 
    Unlike other excluded costs, the acquisition costs are concentrated in 
    specific DRGs (DRG 302 (Kidney Transplant); DRG 103 (Heart Transplant 
    for heart and heart-lung transplants); DRG 480 (Liver Transplant); and 
    DRG 495 (Lung Transplant)). Because these costs are paid separately 
    from the prospective payment rate, it is necessary to make an 
    adjustment to prevent the relative weights for these DRGs from 
    including the effect of the acquisition costs. Therefore, we subtracted 
    the acquisition charges from the total charges on each transplant bill 
    that showed acquisition charges before computing the average charge for 
    the DRG and before eliminating statistical outliers.
        When we recalibrated the DRG weights for previous years, we set a 
    threshold of 10 cases as the minimum number of cases required to 
    compute a reasonable weight. We propose to use that same case threshold 
    in recalibrating the DRG weights for FY 1999. Using the FY 1997 MedPAR 
    data set, there are 38 DRGs that contain fewer than 10 cases. We 
    computed the weights for the 38 low-volume DRGs by adjusting the FY 
    1998 weights of these DRGs by the percentage change in the average 
    weight of the cases in the other DRGs.
        The weights developed according to the methodology described above, 
    using the proposed DRG classification
    
    [[Page 25585]]
    
    changes, result in an average case weight that is different from the 
    average case weight before recalibration. Therefore, the new weights 
    are normalized by an adjustment factor, so that the average case weight 
    after recalibration is equal to the average case weight before 
    recalibration. This adjustment is intended to ensure that recalibration 
    by itself neither increases nor decreases total payments under the 
    prospective payment system.
        Section 1886(d)(4)(C)(iii) of the Act requires that beginning with 
    FY 1991, reclassification and recalibration changes be made in a manner 
    that assures that the aggregate payments are neither greater than nor 
    less than the aggregate payments that would have been made without the 
    changes. Although normalization is intended to achieve this effect, 
    equating the average case weight after recalibration to the average 
    case weight before recalibration does not necessarily achieve budget 
    neutrality with respect to aggregate payments to hospitals because 
    payment to hospitals is affected by factors other than average case 
    weight. Therefore, as we have done in past years and as discussed in 
    section II.A.4.b of the Addendum to this proposed rule, we are 
    proposing to make a budget neutrality adjustment to assure that the 
    requirement of section 1886(d)(4)(C)(iii) of the Act is met.
    
    III. Proposed Changes to the Hospital Wage Index
    
    A. Background
    
        Section 1886(d)(3)(E) of the Act requires that, as part of the 
    methodology for determining prospective payments to hospitals, the 
    Secretary must adjust the standardized amounts ``for area differences 
    in hospital wage levels by a factor (established by the Secretary) 
    reflecting the relative hospital wage level in the geographic area of 
    the hospital compared to the national average hospital wage level.'' In 
    accordance with the broad discretion conferred under the Act, we 
    currently define hospital labor market areas based on the definitions 
    of Metropolitan Statistical Areas (MSAs), Primary MSAs (PMSAs), and New 
    England County Metropolitan Areas (NECMAs) issued by the Office of 
    Management and Budget (OMB). OMB also designates Consolidated MSAs 
    (CMSAs). A CMSA is a metropolitan area with a population of one million 
    or more, comprised of two or more PMSAs (identified by their separate 
    economic and social character). For purposes of the hospital wage 
    index, we use the PMSAs rather than CMSAs since 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. Rural areas 
    are areas outside a designated MSA, PMSA, or NECMA.
        We note that effective April 1, 1990, the term Metropolitan Area 
    (MA) replaced the term Metropolitan Statistical Area (MSA) (which had 
    been used since June 30, 1983) to describe the set of metropolitan 
    areas comprised of MSAs, PMSAs, and CMSAs. The terminology was changed 
    by OMB in the March 30, 1990 Federal Register to distinguish between 
    the individual metropolitan areas known as MSAs and the set of all 
    metropolitan areas (MSAs, PMSAs, and CMSAs) (55 FR 12154). For purposes 
    of the prospective payment system, we will continue to refer to these 
    areas as MSAs.
        Section 1886(d)(3)(E) of the Act also requires that the wage index 
    be updated annually beginning October 1, 1993. Furthermore, this 
    section provides that the Secretary base the update on a survey of 
    wages and wage-related costs of short-term, acute care hospitals. The 
    survey should measure, to the extent feasible, the earnings and paid 
    hours of employment by occupational category, and must exclude the 
    wages and wage-related costs incurred in furnishing skilled nursing 
    services. We also adjust the wage index, as discussed below in section 
    III.F, to take into account the geographic reclassification of 
    hospitals in accordance with sections 1886(d)(8)(B) and 1886(d)(10) of 
    the Act.
    
    B. FY 1999 Wage Index Update
    
        The proposed FY 1999 wage index in section V of the Addendum 
    (effective for hospital discharges occurring on or after October 1, 
    1998 and before October 1, 1999) is based on the data collected from 
    the Medicare cost reports submitted by hospitals for cost reporting 
    periods beginning in FY 1995 (the FY 1998 wage index was based on FY 
    1994 wage data). The proposed FY 1999 wage index includes the following 
    categories of data, which were also included in the FY 1998 wage index:
         Total salaries and hours from short-term, acute care 
    hospitals.
         Home office costs and hours.
         Direct patient care contract labor costs and hours.
        The proposed wage index also continues to exclude the direct 
    salaries and hours for nonhospital services such as skilled nursing 
    facility services, home health services, or other subprovider 
    components that are not subject to the prospective payment system. 
    Finally, as discussed in detail in the August 29, 1997 final rule with 
    comment period, we would calculate a separate Puerto Rico-specific wage 
    index and apply it to the Puerto Rico standardized amount. (See 62 FR 
    45984 and 46041) This wage index is based solely on Puerto Rico's data.
        For FY 1999 we are proposing to include two changes to the 
    categories: we will add contract labor costs and hours for top 
    management positions and replace the fringe benefit category with the 
    wage-related costs associated with hospital and home office salaries 
    category. These two changes reflect changes to the Medicare cost report 
    that were implemented in the FY 1995 hospital prospective payment 
    system September 1, 1994 final rule with comment period (59 FR 45355). 
    The changes were made to the cost report for cost reporting periods 
    beginning during FY 1995. Because we are using wage data from the FY 
    1995 cost report for the proposed FY 1999 wage index, these two changes 
    will be reflected in the wage index for the first time in FY 1999.
        As discussed in detail in the September 1, 1994 final rule with 
    comment period (59 FR 45355), we expanded the definition of contract 
    services reported on the Worksheet S-3 to include the labor-related 
    costs associated with contract personnel in a hospital's top four 
    management positions: Chief Executive Officer (CEO)/Hospital 
    Administrator, Chief Operating Officer (COO), Chief Financial Officer 
    (CFO), and Nursing Administrator. We also revised the cost report to 
    reflect a change in terminology from ``fringe benefits'' to ``wage-
    related costs,'' to promote the consistent reporting of these costs. 
    (See September 1, 1994 final rule with comment period 59 FR 45356-
    45359.) We made this change in terminology because we believe that it 
    will eliminate confusion regarding those wage-related costs that are 
    incorporated in the wage index versus the broader definition of fringe 
    benefits recognized under the Medicare cost reimbursement principles. 
    Wage-related costs, which include core and other wage-related costs, 
    are reported on the Form HCFA-339, the Provider Cost Report 
    Reimbursement Questionnaire.
        Finally, we have analyzed the wage data for the following costs, 
    which were separately reported for the first time on the FY 1995 cost 
    reports:
         Physician Part A costs.
         Resident and Certified Registered Nurse Anesthetist (CRNA) 
    Part A costs.
         Overhead cost and hours by cost center.
        Our analysis and proposals concerning these data are set forth 
    below in section III.C.
    
    [[Page 25586]]
    
    C. Proposals Concerning the FY 1999 Wage Index
    
    1. Physician Part A Costs.
        Currently, if a hospital directly employs a physician, the Part A 
    portion of the physician's salary and wage-related costs (that is, 
    administrative and teaching service) is included in the calculation of 
    the wage index. However, the costs for contract physician Part A 
    services are not included. Our policy has been that, to be included in 
    the wage index calculation, a contracted service must be related to 
    direct patient care, or, beginning with the FY 1999 wage index, top 
    level management (see discussion above). Because some States have laws 
    that prohibit hospitals from directly hiring physicians, the hospitals 
    in those States have claimed that they are disadvantaged by the wage 
    index's exclusion of contract physician Part A costs. We began 
    collecting separate wage data for both direct and contract physician 
    Part A services on the FY 1995 cost report in order to analyze this 
    issue. As we discussed in the September 1, 1994 final rule with comment 
    period (59 FR 45354), our original purpose in collecting these data was 
    to exclude all Part A physician costs from the wage index.
        When we made the change to the cost report, there were five States 
    in which hospitals were prohibited from directly employing physicians. 
    We understand that only two States currently maintain this prohibition: 
    Texas and California. Thus, the number of hospitals affected by our 
    current policy has decreased. Nevertheless, the fact that hospitals in 
    these two States are still prohibited from directly employing 
    physicians for Part A services and, therefore, must enter into 
    contractual agreements with physicians for these services, perpetuates 
    the perceived inequity.
        The main reasons we planned to exclude all Part A physician costs 
    rather than include the contract costs was our concern that it would be 
    difficult to accurately attribute the Part A costs and hours of these 
    contract physicians and including these costs could inappropriately 
    inflate the hospitals' average hourly wages. That is, we anticipated 
    that average costs for contract physicians would be significantly 
    higher than the costs for those physicians directly employed by the 
    hospital. However, our analysis of the data shows that the average 
    hourly wages for contract physician Part A costs are very similar to, 
    and, in fact slightly lower than, the costs for salaried Part A 
    physician services.
        Based on this result, we believe that continuing to include the 
    direct physician Part A costs and adding the costs for contract 
    physicians would be the better policy. Thus, we are proposing to 
    calculate the FY 1999 wage index including both direct and contract 
    physician Part A costs.
        Of the 5,115 hospitals included in the FY 1995 wage data file, 
    approximately 23 percent reported contract physician Part A costs. 
    Including these costs would raise the wage index values for one MSA (2 
    hospitals) by more than 5 percent and 5 MSAs (60 hospitals) by between 
    2 and 5 percent. One Statewide rural area (68 hospitals) would 
    experience a decrease between 2 and 5 percent. The wage index values 
    for the remaining 365 areas (5,055 hospitals) would be relatively 
    unaffected, experiencing changes of between -2 and 2 percent. We 
    understand that an unusually large number of hospitals have requested 
    changes to these wage data; therefore, there may be relatively 
    significant differences between the wage data file used to calculate 
    the proposed wage index and the final corrected wage data in the file 
    used to calculate the final wage index. Because of this, we will 
    reevaluate our decision based on that final wage data, which will be 
    submitted by April 6, 1998. If we find significant differences in the 
    contract labor costs, we may reconsider our proposal.
    2. Resident and CRNA Part A Costs
        The wage index presently includes salaries and wage-related costs 
    for residents in approved medical education programs and for CRNAs 
    employed by hospitals under the rural pass-through provision. However, 
    Medicare pays for these costs outside the prospective payment system. 
    Removing these costs from the wage index calculation would be 
    consistent with our general policy to exclude costs that are not paid 
    through the prospective payment system, but, because they were not 
    separately identifiable, we could not remove them.
        In the September 1, 1994 final rule with comment period (59 FR 
    45355), we stated that we would begin collecting the resident and CRNA 
    wage data separately and would evaluate the data before proposing a 
    change in computing the wage index. However, there were data reporting 
    problems associated with these costs on the FY 1995 cost report. The 
    original instructions for reporting resident costs on Line 6 of 
    Worksheet S-3, Part III, erroneously included teaching physician 
    salaries and other teaching program costs from Worksheet A of the cost 
    report. Although we issued revised instructions to correct this error, 
    we now understand these revisions may not have been uniformly 
    instituted. Another issue relating to residents' salaries stems from 
    apparent underreporting of these costs by hospitals and inconsistent 
    treatment of the associated wage-related costs.
        In addition, the original Worksheet S-3 and reporting instructions 
    did not provide for the separate reporting of CRNA wage-related costs. 
    Another issue with the FY 1995 wage data is the inclusion of contract 
    CRNA Part A costs in the contract labor costs reported on Worksheet S-
    3. We believe that much of the CRNA Part A costs are reported under 
    contract labor, rather than under salaried employee costs, due to the 
    heavy use of contract labor by rural hospitals. We do not believe that 
    it would be feasible at this time to try to remove these CRNA Part A 
    costs from the contract labor costs. We improved the reporting 
    instructions for CRNA costs on the FY 1996 cost report.
        Our analysis of the CRNA and resident wage data submitted on the FY 
    1995 cost report convinces us that these data are inaccurately and 
    incompletely reported by hospitals. For example, although there are 
    over 900 teaching hospitals receiving graduate medical education 
    payments, only about 800 hospitals reported resident cost data. Because 
    we do not want to make a relatively significant change in the wage 
    index data calculation without complete and accurate data upon which to 
    base our decision, we are proposing to delay any decision regarding 
    excluding resident and CRNA costs from the wage index until at least 
    next year. We will review the FY 1996 data when it becomes available 
    later this year and present our analysis and any proposals in next 
    year's proposed rule.
    3. Overhead Allocation
        Prior years' wage index calculations have excluded the direct wages 
    and hours associated with certain subprovider components that are 
    excluded from the prospective payment system; however, the overhead 
    costs associated with excluded components have not been removed. We 
    have previously attempted to remove the overhead costs associated with 
    these excluded areas of the hospital on two separate occasions. Based 
    on the quality of the data, as well as comments we received from the 
    public, these proposals were never implemented.
        In the September 1, 1995 final rule with comment period (60 FR 
    45797), we discussed the results of the second of these efforts. Our 
    analysis was prompted by several suggestions from hospital 
    representatives that the current methodology, which removes the higher
    
    [[Page 25587]]
    
    nursing costs in excluded areas from the hospital's direct salaries but 
    leaves in the lower general services salaries, negatively distorts 
    wages. However, the results of our analysis at that time dissuaded us 
    from proposing to exclude these areas' overhead costs because the data 
    were unreliable. We revised the FY 1995 cost report to allow for the 
    reporting of the overhead salaries and hours. We stated that we would 
    reexamine this issue when the FY 1995 cost report data became 
    available.
        To allocate overhead costs based on the data reported on Worksheet 
    S-3, we first determined the ratio of the hours reported directly to 
    excluded areas compared to the total hours. Total overhead hours and 
    salaries were then multiplied by this ratio to allocate the proportion 
    of overhead costs attributable to excluded areas. Next, the overhead 
    hours and salaries attributable to excluded areas were subtracted from 
    the hospital's total hours and salaries, and an average hourly wage 
    reflecting this overhead allocation was computed.
        Of the 5,115 hospitals in the FY 1995 wage data file, 3,661 
    reported overhead hours (hospitals were only required to separately 
    report overhead hours if their number of directly assigned excluded 
    hours exceeded 5 percent of their total hours). The overhead allocation 
    would result in an increase in the wage index value of more than 5 
    percent for only one MSA (2 hospitals). A total of 12 labor areas (5 
    Statewide rural (206 hospitals) and 7 MSAs (25 hospitals)) would 
    experience an increase of between 2 percent and 5 percent. Only one MSA 
    (29 hospitals) would experience a decline of between 2 and 5 percent. 
    The wage index value for the remaining 358 areas (4,921 hospitals) 
    would be affected by less than 2 percent.
        We are proposing to include this exclusion of overhead allocation 
    in the calculation of the FY 1999 wage index. Although the overall 
    impact on hospitals of this change is relatively small, we believe it 
    is an appropriate step toward improving the overall consistency of the 
    wage index. Additionally, we believe this change will significantly 
    increase the accuracy of the wage data for individual hospitals, 
    especially hospitals that have a relatively small portion of their 
    facility devoted to acute inpatient care.
    
    D. Verification of Wage Data From the Medicare Cost Report
    
        The data for the proposed FY 1999 wage index were obtained from 
    Worksheet S-3, Parts III and IV of the FY 1995 Medicare cost reports. 
    The data file used to construct the proposed wage index includes FY 
    1995 data submitted to the Health Care Provider Cost Report Information 
    System (HCRIS) as of early January 1998. As in past years, we performed 
    an intensive review of the wage data, mostly through the use of edits 
    designed to identify aberrant data.
        Of the 5,123 hospitals originally in the data file, 851 hospitals 
    had data elements that failed an edit. From mid-January to mid-February 
    1998, intermediaries contacted hospitals to revise or verify data 
    elements that resulted in the edit failures.
        As of February 17, 1998, 31 hospitals still had unresolved data 
    elements. These unresolved data elements are included in the 
    calculation of the proposed FY 1999 wage index pending their resolution 
    before calculation of the final FY 1999 wage index. We have instructed 
    the intermediaries to complete their verification of questionable data 
    elements and to transmit any changes to the wage data (through HCRIS) 
    no later than April 6, 1998. We expect that all unresolved data 
    elements will be resolved by that date. The revised data will be 
    reflected in the final rule.
        Also, as part of our editing process, we deleted data for eight 
    hospitals that failed edits. For two of these hospitals, we were unable 
    to obtain sufficient documentation to verify or revise the data because 
    the hospitals are no longer participating in the Medicare program or 
    are in bankruptcy status. The data from the remaining six participating 
    hospitals were removed because inclusion of their data would have 
    significantly distorted the wage index values. The data for these six 
    hospitals will be included in the final wage index if we receive 
    corrected data that passes our edits. As a result, the proposed FY 1999 
    wage index is calculated based on FY 1995 wage data for 5,115 
    hospitals.
    
    E. Computation of the Wage Index
    
        The method used to compute the proposed wage index is as follows:
        Step 1--As noted above, we are proposing to base the FY 1999 wage 
    index on wage data reported on the FY 1995 Medicare cost reports. We 
    gathered data from each of the non-Federal, short-term, acute care 
    hospitals for which data were reported on the Worksheet S-3, Parts III 
    and IV of the Medicare cost report for the hospital's cost reporting 
    period beginning on or after October 1, 1994 and before October 1, 
    1995. In addition, we included data from a few hospitals that had cost 
    reporting periods beginning in September 1994 and reported a cost 
    reporting period exceeding 52 weeks. These data were included because 
    no other data from these hospitals would be available for the cost 
    reporting period described above, and particular labor market areas 
    might be affected due to the omission of these hospitals. However, we 
    generally describe these wage data as FY 1995 data.
        Step 2--For each hospital, we subtracted the excluded salaries 
    (that is, direct salaries attributable to skilled nursing facility 
    services, home health services, and other subprovider components not 
    subject to the prospective payment system) from gross hospital salaries 
    to determine net hospital salaries. To determine total salaries plus 
    wage-related costs, we added the costs of contract labor for direct 
    patient care, certain top management, and physician Part A services; 
    hospital wage-related costs, and any home office salaries and wage-
    related costs reported by the hospital, to the net hospital salaries. 
    The actual calculation is the sum of lines 2, 4, 6, and 33 of Worksheet 
    S-3, Part III. This calculation differs from the one computed on line 
    32 of Worksheet S-3, Part III. Therefore, a hospital's average hourly 
    wage calculated under Step 2 will be different from the average hourly 
    wage shown on line 32, column 5.
        Step 3--For each hospital, we subtracted the reported excluded 
    hours from the gross hospital hours to determine net hospital hours. To 
    determine total hours, we increased the net hours by the addition of 
    home office hours and hours for contract labor attributable to direct 
    patient care, certain top management, and physician Part A salaries.
        Step 4--For each hospital reporting both total overhead salaries 
    and total overhead hours greater than zero, we then allocated overhead 
    costs. First, we determined the ratio of excluded area hours (Line 24 
    of Worksheet S-3, Part III) to revised total hours (Line 9 of Worksheet 
    S-3, Part III, adding back CRNA Part A, physician Part A, and resident 
    hours). Second, we computed the amounts of overhead salaries and hours 
    to be allocated to excluded areas by multiplying the above ratio by the 
    total overhead salaries and hours reported on Line 16 of Worksheet S-3, 
    Part IV. Finally, we subtracted the computed overhead salaries and 
    hours associated with excluded areas from the total salaries and hours 
    derived in Steps 2 and 3.
        Step 5--For each hospital, we adjusted the total salaries plus 
    wage-related costs to a common period to determine total adjusted 
    salaries plus wage-related costs. To make the wage inflation 
    adjustment, we estimated the percentage change in the employment
    
    [[Page 25588]]
    
    cost index (ECI) for compensation for each 30-day increment from 
    October 14, 1994 through April 15, 1996, for private industry hospital 
    workers from the Bureau of Labor Statistics Compensation and Working 
    Conditions. For previous wage indexes, we used the percentage change in 
    average hourly earnings for hospital industry workers to make the wage 
    inflation adjustment. For FY 1999 we are proposing to use the ECI for 
    compensation for private industry hospital workers because it reflects 
    the price increase associated with total compensation (salaries plus 
    fringes) rather than just the increase in salaries, which is what the 
    average hourly earnings category reflected. In addition, the ECI 
    includes managers as well as other hospital workers. We are also 
    proposing to change the methodology used to compute the monthly update 
    factors. This new methodology uses actual quarterly ECI data to 
    determine the monthly update factors. The methodology assures that the 
    update factors match the actual quarterly and annual percent changes. 
    The inflation factors used to inflate the hospital's data were based on 
    the midpoint of the cost reporting period as indicated below.
    
                        Midpoint of Cost Reporting Period                   
    ------------------------------------------------------------------------
                                                                  Adjustment
                         After                         Before       factor  
    ------------------------------------------------------------------------
    10/14/94......................................     11/15/94     1.032882
    11/14/94......................................     12/15/94     1.030771
    12/14/94......................................     01/15/95     1.028721
    01/14/95......................................     02/15/95     1.026731
    02/14/95......................................     03/15/95     1.024776
    03/14/95......................................     04/15/95     1.022827
    04/14/95......................................     05/15/95     1.020886
    05/14/95......................................     06/15/95     1.018901
    06/14/95......................................     07/15/95     1.016822
    07/14/95......................................     08/15/95     1.014649
    08/14/95......................................     09/15/95     1.012446
    09/14/95......................................     10/15/95     1.010279
    10/14/95......................................     11/15/95     1.008146
    11/14/95......................................     12/15/95     1.006047
    12/14/95......................................     01/15/96     1.003981
    01/14/96......................................     02/15/96     1.001950
    02/14/96......................................     03/15/96     1.000000
    03/14/96......................................     04/15/96     0.998181
    ------------------------------------------------------------------------
    
        For example, the midpoint of a cost reporting period beginning 
    January 1, 1995 and ending December 31, 1995 is June 30, 1995. An 
    inflation adjustment factor of 1.016822 would be applied to the wages 
    of a hospital with such a cost reporting period. In addition, for the 
    data for any cost reporting period that began in FY 1995 and covers a 
    period of less than 360 days or greater than 370 days, we annualized 
    the data to reflect a 1-year cost report. Annualization is accomplished 
    by dividing the data by the number of days in the cost report and then 
    multiplying the results by 365.
        Step 6--Each hospital was assigned to its appropriate urban or 
    rural labor market area prior to any reclassifications under sections 
    1886(d)(8)(B) or 1886(d)(10) of the Act. Within each urban or rural 
    labor market area, we added the total adjusted salaries plus wage-
    related costs obtained in Step 5 for all hospitals in that area to 
    determine the total adjusted salaries plus wage-related costs for the 
    labor market area.
        Step 7--We divided the total adjusted salaries plus wage-related 
    costs obtained in Step 6 by the sum of the total hours (from Step 4) 
    for all hospitals in each labor market area to determine an average 
    hourly wage for the area.
        Step 8--We added the total adjusted salaries plus wage-related 
    costs obtained in Step 5 for all hospitals in the Nation and then 
    divided the sum by the national sum of total hours from Step 4 to 
    arrive at a national average hourly wage. Using the data as described 
    above, the national average hourly wage is $20.6036.
        Step 9--For each urban or rural labor market area, we calculated 
    the hospital wage index value by dividing the area average hourly wage 
    obtained in Step 7 by the national average hourly wage computed in Step 
    8.
        Step 10--Following the process set forth above, we developed a 
    separate Puerto Rico-specific wage index for purposes of adjusting the 
    Puerto Rico standardized amounts. We added the total adjusted salaries 
    plus wage-related costs (as calculated in Step 5) for all hospitals in 
    Puerto Rico and divided the sum by the total hours for Puerto Rico (as 
    calculated in Step 4) to arrive at an overall average hourly wage of 
    $9.3339 for Puerto Rico. For each labor market area in Puerto Rico, we 
    calculated the hospital wage index value by dividing the area average 
    hourly wage (as calculated in Step 7) by the overall Puerto Rico 
    average hourly wage.
        Step 11--Section 4410 of Public Law 105-33 provides that, for 
    discharges on or after October 1, 1997, the area wage index applicable 
    to any hospital that is not located in a rural area may not be less 
    than the area wage index applicable to hospitals located in rural areas 
    in that State. Furthermore, this wage index floor is to be implemented 
    in such a manner as to assure that aggregate prospective payment system 
    payments are not greater or less than those which would have been made 
    in the year if this section did not apply. For FY 1999, this change 
    affects 229 hospitals in 34 MSAs. The MSAs affected by this provision 
    are identified in Table 4A by a footnote.
    
    F. Revisions to the Wage Index Based on Hospital Redesignation
    
        Under section 1886(d)(8)(B) of the Act, hospitals in certain rural 
    counties adjacent to one or more MSAs are considered to be located in 
    one of the adjacent MSAs if certain standards are met. Under section 
    1886(d)(10) of the Act, the Medicare Geographic Classification Review 
    Board (MGCRB) considers applications by hospitals for geographic 
    reclassification for purposes of payment under the prospective payment 
    system.
        The methodology for determining the wage index values for 
    redesignated hospitals is applied jointly to the hospitals located in 
    those rural counties that were deemed urban under section 1886(d)(8)(B) 
    of the Act and those hospitals that were reclassified as a result of 
    the MGCRB decisions under section 1886(d)(10) of the Act. Section 
    1886(d)(8)(C) of the Act provides that the application of the wage 
    index to redesignated hospitals is dependent on the hypothetical impact 
    that the wage data from these hospitals would have on the wage index 
    value for the area to which they have been redesignated. Therefore, as 
    provided in section 1886(d)(8)(C) of the Act, the wage index values 
    were determined by considering the following:
         If including the wage data for the redesignated hospitals 
    would reduce the wage index value for the area to which the hospitals 
    are redesignated by 1 percentage point or less, the area wage index 
    value determined exclusive of the wage data for the redesignated 
    hospitals applies to the redesignated hospitals.
         If including the wage data for the redesignated hospitals 
    reduces the wage index value for the area to which the hospitals are 
    redesignated by more than 1 percentage point, the hospitals that are 
    redesignated are subject to that combined wage index value.
         If including the wage data for the redesignated hospitals 
    increases the wage index value for the area to which the hospitals are 
    redesignated, both the area and the redesignated hospitals receive the 
    combined wage index value.
         The wage index value for a redesignated urban or rural 
    hospital cannot be reduced below the wage index value for the rural 
    areas of the State in which the hospital is located.
         Rural areas whose wage index values would be reduced by 
    excluding the wage data for hospitals that have been redesignated to 
    another area continue to have their wage index values calculated as if 
    no redesignation had occurred.
         Rural areas whose wage index values increase as a result 
    of excluding
    
    [[Page 25589]]
    
    the wage data for the hospitals that have been redesignated to another 
    area have their wage index values calculated exclusive of the wage data 
    of the redesignated hospitals.
         The wage index value for an urban area is calculated 
    exclusive of the wage data for hospitals that have been reclassified to 
    another area. However, geographic reclassification may not reduce the 
    wage index value for an urban area below the statewide rural wage index 
    value.
        We note that, except for those rural areas where redesignation 
    would reduce the rural wage index value, the wage index value for each 
    area is computed exclusive of the wage data for hospitals that have 
    been redesignated from the area for purposes of their wage index. As a 
    result, several urban areas listed in Table 4a have no hospitals 
    remaining in the area. This is because all the hospitals originally in 
    these urban areas have been reclassified to another area by the MGCRB. 
    These areas with no remaining hospitals receive the prereclassified 
    wage index value. The prereclassified wage index value will apply as 
    long as the area remains empty.
        The proposed revised wage index values for FY 1999 are shown in 
    Tables 4A, 4B, 4C, and 4F in the Addendum to this proposed rule. 
    Hospitals that are redesignated should use the wage index values shown 
    in Table 4C. Areas in Table 4C may have more than one wage index value 
    because the wage index value for a redesignated urban or rural hospital 
    cannot be reduced below the wage index value for the rural areas of the 
    State in which the hospital is located. When the wage index value of 
    the area to which a hospital is redesignated is lower than the wage 
    index value for the rural areas of the State in which the hospital is 
    located, the redesignated hospital receives the higher wage index 
    value, that is, the wage index value for the rural areas of the State 
    in which it is located, rather than the wage index value otherwise 
    applicable to the redesignated hospitals.
        Tables 4D and 4E list the average hourly wage for each labor market 
    area, prior to the redesignation of hospitals, based on the FY 1995 
    wage data. In addition, Table 3C in the Addendum to this proposed rule 
    includes the adjusted average hourly wage for each hospital based on 
    the FY 1995 data (as calculated from Steps 4 and 5, above). The MGCRB 
    will use the average hourly wage published in the final rule to 
    evaluate a hospital's application for reclassification, unless that 
    average hourly wage is later revised in accordance with the wage data 
    correction policy described in Sec. 412.63(w)(2). In such cases, the 
    MGCRB will use the most recent revised data used for purposes of the 
    hospital wage index. Hospitals that choose to apply before publication 
    of the final rule may use the proposed wage data in applying to the 
    MGCRB for wage index reclassifications that would be effective for FY 
    2000. We note that in adjudicating these wage index reclassification 
    requests during FY 1999, the MGCRB will use the average hourly wages 
    for each hospital and labor market area that are reflected in the final 
    FY 1999 wage index.
        At the time this proposed wage index was constructed, the MGCRB had 
    completed its review. The proposed FY 1999 wage index values 
    incorporate all 435 hospitals redesignated for purposes of the wage 
    index (hospitals redesignated under section 1886(d)(8)(B) or 
    1886(d)(10) of the Act) for FY 1999. The final number of 
    reclassifications may be different because some MGCRB decisions are 
    still under review by the Administrator and because some hospitals may 
    withdraw their requests for reclassification.
        Any changes to the wage index that result from withdrawals of 
    requests for reclassification, wage index corrections, appeals, and the 
    Administrator's review process will be incorporated into the wage index 
    values published in the final rule. The changes may affect not only the 
    wage index value for specific geographic areas, but also whether 
    redesignated hospitals receive the wage index value for the area to 
    which they are redesignated, or a wage index value that includes the 
    data for both the hospitals already in the area and the redesignated 
    hospitals. Further, the wage index value for the area from which the 
    hospitals are redesignated may be affected.
        Under Sec. 412.273, hospitals that have been reclassified by the 
    MGCRB are permitted to withdraw their applications within 45 days of 
    the publication of this Federal Register document. The request for 
    withdrawal of an application for reclassification that would be 
    effective in FY 1999 must be received by the MGCRB by June 22, 1998. A 
    hospital that requests to withdraw its application may not later 
    request that the MGCRB decision be reinstated.
    
    G. Requests for Wage Data Corrections
    
        As a part of the August 29, 1997 final rule with comment period, we 
    implemented a new timetable for requesting wage data corrections (62 FR 
    45990). In February 1998, we notified hospitals again of these changes 
    through a memorandum to the fiscal intermediaries. To allow hospitals 
    time to evaluate the wage data used to construct the proposed FY 1999 
    hospital wage index, we made available to the public a data file 
    containing the FY 1995 hospital wage data. In a memorandum dated 
    February 2, 1998, we instructed all Medicare intermediaries to inform 
    the prospective payment hospitals that they serve of the availability 
    of the wage data file and the process and timeframe for requesting 
    revisions. The wage data file was made available February 6, 1998, 
    through the Internet at HCFA's home page (http://www.hcfa.gov). The 
    intermediaries were also instructed to advise hospitals of the 
    alternative availability of these data through their representative 
    hospital organizations or directly from HCFA. Additional details on 
    ordering this data file are discussed in section IX.A of this preamble, 
    ``Requests for Data from the Public.''
        In addition, Table 3C in the Addendum to this proposed rule 
    contains each hospital's adjusted average hourly wage used to construct 
    the proposed wage index values. A hospital can verify its adjusted 
    average hourly wage, as calculated from Steps 4 and 5 of the 
    computation of the wage index (see section III.E of this preamble, 
    above) based on the wage data on the hospital's cost report (after 
    taking into account any adjustments made by the intermediary), by 
    dividing the adjusted average hourly wage in Table 3C by the applicable 
    wage adjustment factors as set forth above in Step 5 of the computation 
    of the wage index. As noted above, however, a hospital's average hourly 
    wages using this calculation will vary from the average hourly wages 
    shown on Line 32 of Worksheet S-3, Part III. An updated Table 3C (along 
    with applicable wage adjustment factors) will be included in the final 
    rule.
        We believe hospitals have had ample time to ensure the accuracy of 
    their FY 1995 wage data. Moreover, the ultimate responsibility for 
    accurately completing the cost report rests with the hospital, which 
    must attest to the accuracy of the data at the time the cost report is 
    filed. However, if after review of the wage data file released February 
    6, a hospital believed that its FY 1995 wage data were incorrectly 
    reported, the hospital was to submit corrections along with complete, 
    detailed supporting documentation to its intermediary by March 9, 1998. 
    To be reflected in the final wage index, any wage data corrections must 
    be reviewed and verified by the intermediary and transmitted to HCFA on 
    or before April 6, 1998. These deadlines are necessary
    
    [[Page 25590]]
    
    to allow sufficient time to review and process the data so that the 
    final wage index calculation can be completed for development of the 
    final prospective payment rates to be published by August 1, 1998. We 
    cannot guarantee that corrections transmitted to HCFA after April 6 
    will be reflected in the final wage index.
        After reviewing requested changes submitted by hospitals, 
    intermediaries transmitted any revised cost reports to HCRIS and 
    forwarded a copy of the revised Worksheet S-3, Parts III and IV to the 
    hospitals. If requested changes were not accepted, fiscal 
    intermediaries notified hospitals of the reasons why the changes were 
    not accepted. This procedure ensures that hospitals have every 
    opportunity to verify the data that will be used to construct their 
    wage index values. We believe that fiscal intermediaries are generally 
    in the best position to make evaluations regarding the appropriateness 
    of a particular cost and whether it should be included in the wage 
    index data. However, if a hospital disagrees with the intermediary's 
    resolution of a requested change, the hospital may contact HCFA in an 
    effort to resolve policy disputes. We note that the April 6 deadline 
    also applies to these requested changes. We will not consider factual 
    determinations at this time as these should have been resolved earlier 
    in the process.
        We have created the process described above to resolve all 
    substantive wage data correction disputes before we finalize the wage 
    data for the FY 1999 payment rates. Accordingly, hospitals that do not 
    meet the procedural deadlines set forth above will not be afforded a 
    later opportunity to submit wage corrections or to dispute the 
    intermediary's decision with respect to requested changes.
        We note that, beginning this year with the FY 1999 wage index, the 
    final wage index that is published August 1 will incorporate all 
    corrections, including those to correct data entry or tabulation errors 
    of the final wage data by the intermediary or HCFA. The final wage data 
    public use file will be released by May 7, 1998. Hospitals will have 
    until June 5, 1998, to submit requests to correct errors in the final 
    wage data due to data entry or tabulation errors by the intermediary or 
    HCFA. The correction requests that will be considered after the March 9 
    deadline will be limited to errors in the entry or tabulation of the 
    final wage data which the hospital could not have known about prior to 
    March 9, 1998.
        The final wage data file released in early May will contain the 
    wage data that will be used to construct the wage index values in the 
    final rule. As with the file made available in February, HCFA will make 
    the final wage data file released in May available to hospital 
    associations and the public (on the Internet). This file, however, is 
    being made available only for the limited purpose of identifying any 
    potential errors made by HCFA or the intermediary in the entry of the 
    final wage data that result from the correction process described above 
    (with the March 9 deadline), not for the initiation of new wage data 
    correction requests. Hospitals are encouraged to review their hospital 
    wage data promptly after the release of the final file.
        If, after reviewing the final file, a hospital believes that its 
    wage data are incorrect due to a fiscal intermediary or HCFA error in 
    the entry or tabulation of the final wage data, it should send a letter 
    to both its fiscal intermediary and HCFA. The letters should outline 
    why the hospital believes an error exists and provide all supporting 
    information, including dates. These requests must be received by HCFA 
    and the intermediaries no later than June 5, 1998. Requests mailed to 
    HCFA should be sent to: Health Care Financing Administration; Center 
    for Health Plans and Providers; Attention: Stephen Phillips, Technical 
    Advisor; Division of Acute Care; C5-06-27; 7500 Security Boulevard; 
    Baltimore, MD 21244-1850. Each request also must be sent to the 
    hospital's fiscal intermediary. The intermediary will review requests 
    upon receipt and contact HCFA immediately to discuss its findings.
        At this time, changes to the hospital wage data will be made only 
    in those very limited situations involving an error by the intermediary 
    or HCFA that the hospital could not have known about before its review 
    of the final wage data file. Specifically, neither the intermediary nor 
    HCFA will accept the following types of requests at this stage of the 
    process:
         Requests for wage data corrections that were submitted too 
    late to be included in the data transmitted to HCRIS on or before April 
    6, 1998.
         Requests for correction of errors that were not, but could 
    have been, identified during the hospital's review of the February 1998 
    wage data file.
         Requests to revisit factual determinations or policy 
    interpretations made by the intermediary or HCFA during the wage data 
    correction process.
        Verified corrections to the wage index received timely (that is, by 
    June 5, 1998) will be incorporated into the final wage index to be 
    published by August 1, 1998, and effective October 1, 1998.
        Again, we believe the wage data correction process described above 
    provides hospitals with sufficient opportunity to bring errors in their 
    wage data to the intermediary's attention. Moreover, because hospitals 
    will have access to the final wage data by early May, they will have 
    the opportunity to detect any data entry or tabulation errors made by 
    the intermediary or HCFA before the development and publication of the 
    FY 1999 wage index by August 1, 1998, and the implementation of the FY 
    1999 wage index on October 1, 1998. If hospitals avail themselves of 
    this opportunity, the wage index implemented on October 1 should be 
    free of such errors. Nevertheless, in the unlikely event that errors 
    should occur after that date, we retain the right to make midyear 
    changes to the wage index under very limited circumstances.
        Specifically, in accordance with Sec. 412.63(w)(2), we may make 
    midyear corrections to the wage index only in those limited 
    circumstances where a hospital can show: (1) That the intermediary or 
    HCFA made an error in tabulating its data; and (2) that the hospital 
    could not have known about the error, or did not have an opportunity to 
    correct the error, before the beginning of FY 1999 (that is, by the 
    June 5, 1998 deadline). As indicated earlier, since a hospital will 
    have the opportunity to verify its data, and the intermediary will 
    notify the hospital of any changes, we do not foresee any specific 
    circumstances under which midyear corrections would be made. However, 
    should a midyear correction be necessary, the wage index change for the 
    affected area will be effective prospectively from the date the 
    correction is made.
    
    IV.-V. Other Decisions and Changes to the Prospective Payment 
    System for Inpatient Operating Costs
    
    A. Definition of Transfers (Sec. 412.4)
    
        Pursuant to section 1886(d)(5)(I) of the Act, the prospective 
    payment system distinguishes between ``discharges,'' situations in 
    which a patient leaves an acute care (prospective payment) hospital 
    after receiving complete acute care treatment, and ``transfers,'' 
    situations in which the patient is transferred to another acute care 
    hospital for related care. If a full DRG payment were made to each 
    hospital involved in a transfer situation, irrespective of the length 
    of time the patient spent in the ``sending'' hospital prior to 
    transfer, a strong incentive to increase transfers would be created, 
    thereby unnecessarily endangering
    
    [[Page 25591]]
    
    patients' health. Therefore, our policy, which is set forth in the 
    regulations at Sec. 412.4, provides that, in a transfer situation, full 
    payment is made to the final discharging hospital and each transferring 
    hospital is paid a per diem rate for each day of the stay, not to 
    exceed the full DRG payment that would have been made if the patient 
    had been discharged without being transferred.
        Currently, the per diem rate paid to a transferring hospital is 
    determined by dividing the full DRG payment that would have been paid 
    in a nontransfer situation by the geometric mean length of stay for the 
    DRG into which the case falls. Hospitals receive twice the per diem for 
    the first day of the stay and the per diem for every following day up 
    to the full DRG amount. Transferring hospitals are also eligible for 
    outlier payments for cases that meet the cost outlier criteria 
    established for all other cases (nontransfer and transfer cases alike) 
    classified to the DRG. Two exceptions to the transfer payment policy 
    are transfer cases classified into DRG 385 (Neonates, Died or 
    Transferred to Another Acute Care Facility) and DRG 456 (Burns, 
    Transferred to Another Acute Care Facility), which receive the full DRG 
    payment instead of being paid on a per diem basis.
        Under section 1886(d)(5)(J) of the Act, which was added by section 
    4407 of the Balanced Budget Act of 1997, a ``qualified discharge'' from 
    one of 10 DRGs selected by the Secretary to a postacute care provider 
    will be treated as a transfer case beginning with discharges on or 
    after October 1, 1998. Section 1886(d)(5)(J)(iii) confers broad 
    authority on the Secretary to select 10 DRGs ``based upon a high volume 
    of discharges classified within such group and a disproportionate use 
    of'' certain post discharge services. Section 1886(d)(5)(J)(ii) defines 
    a ``qualified discharge'' as a discharge from a prospective payment 
    hospital of an individual whose hospital stay is classified in one of 
    the 10 selected DRGs if, upon such discharge, the individual--
         Is admitted to a hospital or hospital unit that is not a 
    prospective payment system hospital;
         Is admitted to a skilled nursing facility; or
         Is provided home health services by a home health agency 
    if the services relate to the condition or diagnosis for which the 
    individual received inpatient hospital services and if these services 
    are provided within an appropriate period as determined by the 
    Secretary.
        The Conference Agreement that accompanied the law noted that 
    ``(t)he Conferees are concerned that Medicare may in some cases be 
    overpaying hospitals for patients who are transferred to a post acute 
    care setting after a very short acute care hospital stay. The Conferees 
    believe that Medicare's payment system should continue to provide 
    hospitals with strong incentives to treat patients in the most 
    effective and efficient manner, while at the same time, adjust PPS 
    [prospective payment system] payments in a manner that accounts for 
    reduced hospital lengths of stay because of a discharge to another 
    setting.'' (H.R. Rep. No. 105-217, 740.) In its March 1, 1997 report, 
    ProPAC expressed similar concerns: ``* * * length of stay declines have 
    been greater in DRGs associated with substantial postacute care use, 
    suggesting a shift in care from hospital inpatient to postacute 
    settings'' (pp. 21-22).
        In fact, based on the latest available data, overall Medicare 
    hospital costs per case have decreased during FYs 1994 and 1995. This 
    unprecedented real decline in costs per case has led to historically 
    high Medicare operating margins (over 10 percent on average). Along 
    with these declining lengths of stay and costs per case, there has been 
    an increase in the utilization of postacute care. In 1990, the rate of 
    skilled nursing facility services per 1,000 Medicare enrollees was 19. 
    By 1995, it had grown to 33. Corresponding numbers for home health 
    agency services are 58 per 1,000 Medicare enrollees during 1990 and 93 
    per 1,000 enrollees during 1995. Although home health services are not 
    always directly related to a hospitalization episode, there does appear 
    to be a trend toward increased use of home health for the provision of 
    postacute care rehabilitation services. Previous analysis of the 
    percentage of hospital discharges that receive postacute home health 
    care showed a 10.3 percent increase in 1994 compared to 1992.
        Our proposals to implement section 1886(d)(5)(J) of the Act are set 
    forth below.
    1. Selection of 10 DRGs
        Section 1886(d)(5)(J)(iii)(I) of the Act provides that the 
    Secretary select 10 DRGs based on a high volume of discharges to 
    postacute care and a disproportionate use of postacute care services. 
    Therefore, in order to select the DRGs to be paid as transfers, we 
    first identified those DRGs with the highest percentage of postacute 
    care.
        We used the FY 1996 MedPAR file because the complete FY 1997 MedPAR 
    file was not available at the time we conducted our analysis. To 
    identify postacute care utilization, we merged hospital inpatient bill 
    files with postacute care bill files matching beneficiary 
    identification numbers and discharge and admission dates. We created 
    this file rather than depend on information concerning discharge 
    destination on the inpatient bill because we have found that the 
    discharge destination codes included on the hospital bills are often 
    inaccurate in identifying discharges to a facility other than another 
    prospective payment hospital.
        Section 1886(d)(5)(J)(ii)(III) of the Act requires the Secretary to 
    choose an appropriate window of days in which the home health services 
    start in order for the discharge to meet the definition of a transfer. 
    In order to include postdischarge home health utilization in our 
    analysis, we identified all hospital discharges for patients who 
    received any home health care within 7 days after the date of 
    discharge. (As described below in section IV.A.2., we ultimately 
    decided to propose 3 days as the window for home health services.)
        Starting with the DRG with the highest percentage of postacute care 
    discharges and continuing in descending order, we selected the first 20 
    DRGs that had a relatively large number of discharges to postacute care 
    (our lower limit was 14,000 cases). In order to select 10 DRGs from the 
    20 DRGs on our list, for each of the DRGs we considered the volume and 
    percent age of discharges to postacute care that occurred before the 
    mean length of stay and whether the discharges occurring early in the 
    stay were more likely to receive postacute care. The following table 
    lists the 10 DRGs we are proposing to include under our expanded 
    transfer definition, their percentage of postacute utilization compared 
    to total cases, and the total number of cases identified as going to 
    postacute care.
    
    [[Page 25592]]
    
    
    
    ------------------------------------------------------------------------
                                                     Percent of   Number of 
            DRG            Title and type of DRG     postacute    postacute 
                           (surgical or medical)    utilization     cases   
    ------------------------------------------------------------------------
    14.................  Specific Cerebrovascular          49.5      186,845
                          Disorders Except                                  
                          Transient Ischemic                                
                          Attack (Medical).                                 
    113................  Amputation for                    59.0       28,402
                          Circulatory System                                
                          Disorders Excluding                               
                          Upper Limb and Toe                                
                          (Surgical).                                       
    209................  Major Joint Limb                  71.9      257,875
                          Reattachment Procedures                           
                          of Lower Extremity                                
                          (Surgical).                                       
    210................  Hip and Femur Procedures          77.8      111,799
                          Except Major Joint Age                            
                          >17 With CC (Surgical).                           
    211................  Hip and Femur Procedures          74.2       19,548
                          Except Major Joint Age                            
                          >17 Without CC                                    
                          (Surgical).                                       
    236................  Fractures of Hip and              61.2       24,498
                          Pelvis (Medical).                                 
    263................  Skin Graft and/or                 49.4       14,499
                          Debridement for Skin                              
                          Ulcer or Cellulitis With                          
                          CC (Surgical).                                    
    264................  Skin Graft and/or                 39.3        1,328
                          Debridement for Skin                              
                          Ulcer or Cellulitis W/O                           
                          CC (Surgical).                                    
    429................  Organic Disturbances and          45.4       19,314
                          Mental Retardation                                
                          (Medical).                                        
    483................  Tracheostomy Except for           45.3       18,254
                          Face, Mouth and Neck                              
                          Diagnoses (Surgical).                             
    ------------------------------------------------------------------------
    
        We included DRG 263 on the list because of its ranking in the top 
    20 DRGs in terms of postacute utilization and volume of discharges to 
    postacute care. DRGs 263 and 264 are paired DRGS; that is, the only 
    difference in the cases assigned to DRG 263 as opposed to DRG 264 is 
    that the patient has a complicating or comorbid condition. If we 
    included only DRG 263 in the list, it would be possible for a transfer 
    case with a relatively short length of stay that should be assigned to 
    DRG 263 and receive a relatively small transfer payment to be assigned 
    instead to DRG 264, and receive the full DRG payment, simply by failing 
    to include the CC diagnosis code on the bill. Therefore, our choice was 
    to either delete DRG 263 from the list or add DRG 264. We decided to 
    include DRG 264 in the proposed list because DRG 263 fully meets all 
    the conditions for inclusion on the list of 10 DRGS.
    2. Postacute Care Settings
        Section 1886(d)(5)(J)(ii) of the Act requires the Secretary to 
    define and pay as transfers cases from one of 10 DRGs selected by the 
    Secretary if the individual is discharged to one of the following 
    settings:
         A hospital or hospital unit that is not a subsection 
    [1886](d) hospital, that is a hospital or unit excluded from the 
    inpatient prospective payment system.
         A skilled nursing facility that is, a facility that meets 
    the definition of a skilled nursing facility set forth at section 1819 
    of the Act.
         Home health services provided by a home health agency, if 
    the services are related to the condition or diagnosis for which the 
    individual received inpatient hospital services, and if the home health 
    services are provided within an appropriate period (as determined by 
    the Secretary).
        Section 1886(d)(1)(B) of the Act defines the hospitals and hospital 
    units that are excluded from the prospective payment system as the 
    following: psychiatric, rehabilitation, childrens', long-term care, and 
    cancer hospitals and psychiatric and rehabilitation distinct part units 
    of a hospital. Therefore, any discharge from a prospective payment 
    hospital from one of the 10 proposed DRGS that is admitted to one of 
    these types of facilities on the date of discharge from the acute 
    hospital, on or after October 1, 1998, would be considered a transfer 
    and paid accordingly under the prospective payment systems (operating 
    and capital) for inpatient hospital services.
        A discharge from a prospective payment hospital to a skilled 
    nursing facility would include cases discharged from one of the 10 DRGS 
    from an inpatient bed in the hospital to a bed in the same hospital 
    that has been designated for the provision of skilled nursing care (a 
    ``swing'' bed). The swing bed provision allows certain small rural 
    hospitals to furnish services in inpatient beds which, if furnished by 
    a skilled nursing facility, would constitute extended care services. In 
    addition, any patient who receives swing-bed services is deemed to have 
    received extended care services as if furnished by a skilled nursing 
    facility. Thus, if swing beds are not included in the transfer policy, 
    those hospitals with swing bed agreements could move patients assigned 
    to one of the 10 selected DRGs as if it were a discharge from an 
    inpatient bed to a swing bed and receive payment. We do not believe 
    that this would be a fair policy in that it would create a payment 
    advantage for swing bed hospitals. Therefore, we are providing in the 
    regulations that a discharge to a swing bed will be paid as a transfer 
    when the patient is classified to one of the 10 selected DRGs.
        Section 1886(d)(5)(J)(ii)(III) of the Act states that the discharge 
    of an individual who receives home health services upon discharge will 
    be treated as a transfer if ``such services are provided within an 
    appropriate period (as determined by the Secretary) * * *.'' As 
    discussed above in section IV.A.1, we began our analysis using 7 days 
    (one week) as the time period we would consider. We now believe that 3 
    days after the date of discharge is a more appropriate timeframe. Based 
    on our analysis of the FY 1996 bills, approximately 90 percent of 
    patients began receiving home health care within 3 days. We are 
    particularly interested in receiving comments on the appropriate period 
    of time in which home health services should begin in the context of 
    the transfer policy.
        With regard to an appropriate definition of ``home health services 
    * * * relate[d] to the condition or diagnosis for which the individual 
    received inpatient hospital services * * *'', we considered several 
    possible approaches. Under one approach we could compare the principal 
    diagnosis of the inpatient stay to the diagnosis code indicated on the 
    home health bill, similar to our policy on the 3-day payment window for 
    preadmission services. However, we believe that is far too restrictive 
    in terms of qualifying discharges for transfer payment. In addition, a 
    hospital will not know when it discharges a patient to home health what 
    diagnosis code the home health agency will put on the bill. Therefore, 
    the hospital would not be able to correctly code the inpatient bill as 
    a transfer or discharge.
        We also considered proposing that any home health care that begins 
    within the designated timeframe be included ``as related'' in our 
    definition. However, this definition might be too broad and the 
    hospital would not be able to predict which cases should be coded as 
    transfers because the hospital often may not know about home health 
    services that are provided upon discharge but were not ordered or 
    planned for as part of the hospital discharge plan.
        We are proposing that home health services would be considered 
    related to the hospital discharge if the patient is discharged from the 
    hospital with a written plan of care for the provision of home health 
    care services from a home health agency. In this way, the hospital 
    would be fully aware of the status of the patient when discharged and 
    could be held responsible for correctly coding the
    
    [[Page 25593]]
    
    discharge as a transfer on the inpatient bill. In general, this would 
    mean that the home health service would qualify as a Part A home health 
    benefit under section 1861(tt) of the Act as added by section 4611(b) 
    of the BBA.
        We note, however, that we plan to compare inpatient bills with home 
    health service bills for care provided within 3 days after discharge, 
    similar to our current claims edit for hospital to hospital transfers. 
    If we find that home health services were provided within the 
    postdischarge window, the hospital will be notified and the hospital 
    payment adjusted unless the hospital can submit documentation verifying 
    the discharge status of the patient. This will alert hospitals if there 
    are problems with their discharge/transfer billing and allow them to 
    adjust their discharge planning process and billing practices. If we 
    find a continued pattern of a hospital billing for cases from the 10 
    DRGs as discharges and our records indicate that the patients are 
    receiving postacute care services from an excluded hospital, a skilled 
    nursing facility, or within the 3-day home health service window, the 
    hospitals may be investigated for fraudulent or abusive billing 
    practices.
    3. Payment Methodology
        The statute does not dictate the payment methodology we must use 
    for these transfer cases. However, section 1886(d)(5)(J)(i) of the Act 
    provides that the payment amount for a case may not exceed the sum of 
    half the full DRG payment amount and half of the payment amount under 
    the current per diem payment methodology.
        Based on our analysis comparing the costs per case for the 
    transfers in the 10 DRGs with payments under our current transfer 
    payment methodology, we found that most of the 10 DRGs are 
    appropriately paid using our current methodology (that is, twice the 
    per diem for the first day and the per diem for each subsequent day). 
    In fact, this payment would, on average, slightly exceed costs. 
    However, this is not true of DRGs 209, 210, and 211. For those three 
    DRGs, a disproportionate percentage (about 50 percent) of the costs of 
    the case are incurred on the first day of the stay. Therefore, we are 
    proposing to pay DRGs 209, 210, and 211 based on 50 percent of the DRG 
    payment for the first day of the stay and 50 percent of the per diem 
    for the remaining days of the stay. The other seven DRGs would be paid 
    under the current transfer payment methodology.
        In Appendix E to this proposed rule, we have included tables that 
    illustrate, for 9 of the 10 DRGs, the number of total and postacute 
    discharges by length of stay, the geometric mean lengths of stay from 
    FY 1983 through FY 1997, and the estimated average costs and transfer 
    payments by length of stay. (The summary information for DRG 264 was 
    not available at the time of publication because it was not included in 
    the original data file of 20 DRGs used for our analysis.) For DRGs 209, 
    210, and 211, the payment line is determined on the basis of the 
    alternative payment formula described above.
        These tables demonstrate that a very large number of discharges 
    from these 10 DRGs receive postacute care. In addition, the length of 
    stay for these DRGs has decreased sharply over the last several years. 
    We believe that this proposed policy will both decrease the hospitals' 
    financial incentive to discharge patients very early in the stay, often 
    before the full course of acute care treatment has ended, as well as 
    pay the hospital at an appropriate level when it does move patients 
    into postacute care.
        We would revise Sec. 412.4 to reflect these proposed policies. In 
    addition, we would delete the reference in current Sec. 412.4(d)(2) to 
    DRG 456 (Burns, Transferred to Another Acute Care Facility) because we 
    are proposing to replace that DRG, as discussed in section II.B.3 of 
    this preamble. There would no longer be any burn DRG with a transfer 
    designation.
    
    B. Rural Referral Centers (Sec. 412.96)
    
        Under the authority of section 1886(d)(5)(C)(i) of the Act, 
    Sec. 412.96 sets forth the criteria a hospital must meet in order to 
    receive special treatment under the prospective payment system as a 
    rural referral center. For discharges occurring before October 1, 1994, 
    rural referral centers received the benefit of payment based on the 
    other urban rather than the rural standardized amount. As of that date, 
    the other urban and rural standardized amounts were the same. However, 
    rural referral centers continue to receive special treatment under both 
    the disproportionate share hospital payment adjustment and the criteria 
    for geographic reclassification.
        One of the criteria under which a rural hospital may qualify as a 
    rural referral center is to have 275 or more beds available for use. A 
    rural hospital that does not meet the bed size criterion can qualify as 
    a rural referral center if the hospital meets two mandatory criteria 
    (specifying a minimum case-mix index and a minimum number of 
    discharges) and at least one of the three optional criteria (relating 
    to specialty composition of medical staff, source of inpatients, or 
    volume of referrals). With respect to the two mandatory criteria, a 
    hospital may be classified as a rural referral center if its--
         Case-mix index is at least equal to the lower of the 
    median case-mix index for urban hospitals in its census region, 
    excluding hospitals with approved teaching programs, or the median 
    case-mix index for all urban hospitals nationally; and
         Number of discharges is at least 5,000 discharges per year 
    or, if fewer, the median number of discharges for urban hospitals in 
    the census region in which the hospital is located. (The number of 
    discharges criterion for an osteopathic hospital is at least 3,000 
    discharges per year.)
    1. Case-Mix Index
        Section 412.96(c)(1) provides that HCFA will establish updated 
    national and regional case-mix index values in each year's annual 
    notice of prospective payment rates for purposes of determining rural 
    referral center status. The methodology we use to determine the 
    proposed national and regional case-mix index values, is set forth in 
    regulations at Sec. 412.96(c)(1)(ii). The proposed national case-mix 
    index value includes all urban hospitals nationwide, and the proposed 
    regional values are the median values of urban hospitals within each 
    census region, excluding those with approved teaching programs (that 
    is, those hospitals receiving indirect medical education payments as 
    provided in Sec. 412.105).
        These values are based on discharges occurring during FY 1997 
    (October 1, 1996 through September 30, 1997) and include bills posted 
    to HCFA's records through December 1997. Therefore, in addition to 
    meeting other criteria, for hospitals with fewer than 275 beds, we are 
    proposing that to qualify for initial rural referral center status for 
    cost reporting periods beginning on or after October 1, 1998, a 
    hospital's case-mix index value for FY 1997 would have to be at least--
         1.3578; or
         Equal to the median case-mix index value for urban 
    hospitals (excluding hospitals with approved teaching programs as 
    identified in Sec. 412.105) calculated by HCFA for the census region in 
    which the hospital is located.
        The median case-mix values by region are set forth in the table 
    below:
    
    ------------------------------------------------------------------------
                                                                   Case-mix 
                               Region                                index  
                                                                     value  
    ------------------------------------------------------------------------
    1. New England (CT, ME, MA, NH, RI, VT).....................      1.2533
    2. Middle Atlantic (PA, NJ, NY).............................      1.2499
    3. South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV)......      1.3468
    
    [[Page 25594]]
    
                                                                            
    4. East North Central (IL, IN, MI, OH, WI)..................      1.2717
    5. East South Central (AL, KY, MS, TN)......................      1.2965
    6. West North Central (IA, KS, MN, MO, NE, ND, SD)..........      1.2264
    7. West South Central (AR, LA, OK, TX)......................      1.3351
    8. Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)................      1.3752
    9. Pacific (AK, CA, HI, OR, WA).............................      1.3405
    ------------------------------------------------------------------------
    
        The above numbers will be revised in the final rule to the extent 
    required to reflect the updated MedPAR file, which will contain data 
    from additional bills received for discharges through March 31, 1997.
        For the benefit of hospitals seeking to qualify as referral centers 
    or those wishing to know how their case-mix index value compares to the 
    criteria, we are publishing each hospital's FY 1997 case-mix index 
    value in Table 3C in section IV. of the Addendum to this proposed rule. 
    In keeping with our policy on discharges, these case-mix index values 
    are computed based on all Medicare patient discharges subject to DRG-
    based payment.
    2. Discharges
        Section 412.96(c)(2)(i) provides that HCFA will set forth the 
    national and regional numbers of discharges in each year's annual 
    notice of prospective payment rates for purposes of determining 
    referral center status. As specified in section 1886(d)(5)(C)(ii) of 
    the Act, the national standard is set at 5,000 discharges. However, we 
    are proposing to update the regional standards. The proposed regional 
    standards are based on discharges for urban hospitals' cost reporting 
    periods that began during FY 1996 (that is, October 1, 1995 through 
    September 30, 1996). That is the latest year for which we have complete 
    discharge data available.
        Therefore, in addition to meeting other criteria, we are proposing 
    that to qualify for initial rural referral center status for cost 
    reporting periods beginning on or after October 1, 1998, the number of 
    discharges a hospital must have for its cost reporting period that 
    began during FY 1997 would have to be at least--
         5,000; or
         Equal to the median number of discharges for urban 
    hospitals in the census region in which the hospital is located, as 
    indicated in the table below.
    
    ------------------------------------------------------------------------
                                                                   Number of
                               Region                             discharges
    ------------------------------------------------------------------------
    1. New England (CT, ME, MA, NH, RI, VT).....................        6658
    2. Middle Atlantic (PA, NJ, NY).............................        8477
    3. South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV)......        7505
    4. East North Central (IL, IN, MI, OH, WI)..................        7273
    5. East South Central (AL, KY, MS, TN)......................        6852
    6. West North Central (IA, KS, MN, MO, NE, ND, SD)..........        5346
    7. West South Central (AR, LA, OK, TX)......................        5179
    8. Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)................        7926
    9. Pacific (AK, CA, HI, OR, WA).............................        5945
    ------------------------------------------------------------------------
    
        We note that the number of discharges for hospitals in each census 
    region is greater than the national standard of 5,000 discharges. 
    Therefore, 5,000 discharges is the minimum criteria for all hospitals. 
    These numbers will be revised in the final rule based on the latest FY 
    1996 cost report data.
        We reiterate that, to qualify for rural referral center status for 
    cost reporting periods beginning on or after October 1, 1998, an 
    osteopathic hospital's number of discharges for its cost reporting 
    period that began during FY 1996 would have to be at least 3,000.
    
    C. Payments to Disproportionate Share Hospitals: Conforming Change 
    Regarding Interpretation of Medicaid Patient Days Included in 
    Disproportionate Patient Percentage (Sec. 412.106)
    
        Effective for discharges beginning on or after May 1, 1986, 
    hospitals that treat a disproportionately large number of low-income 
    patients receive additional payments through the disproportionate share 
    (DSH) adjustment. One means of determining a hospital's DSH payment 
    adjustment for a cost reporting period requires calculation of its 
    disproportionate patient percentage for the period. The 
    disproportionate patient percentage is the sum of a prescribed Medicare 
    fraction and a Medicaid fraction for the hospital's fiscal period. 
    Under clause (I) of section 1886(d)(5)(F)(vi) of the Act and 
    Sec. 412.106(b)(2), the Medicare fraction is determined by dividing the 
    number of the hospital's patient days for patients who were entitled 
    (for such days) to benefits under both Medicare Part A and Supplemental 
    Security Income (SSI) under Title XVI of the Act, by the total number 
    of the hospital's patient days for the patients who were entitled to 
    Medicare Part A. The Medicaid fraction is determined, in accordance 
    with clause (II) of section 1886(d)(5)(F)(vi) of the Act and 
    Sec. 412.106(b)(4), by dividing the number of the hospital's patient 
    days for patients who (for such days) were eligible for medical 
    assistance under a State Medicaid plan approved under Title XIX of the 
    Act but who were not entitled to Medicare Part A, by the total number 
    of the hospital's patient days for that period.
        Initially, HCFA calculated the Medicaid fraction by interpreting 
    section 1886(d)(5)(F)(vi)(II) of the Act to recognize as Medicaid 
    patient days only those days for which the hospital received Medicaid 
    payment for inpatient hospital services. See 51 FR 31454, 31460 (1986). 
    The agency's interpretation was declared invalid by four Federal 
    circuit courts of appeals. See Cabell Huntington Hosp., Inc. v. 
    Shalala, 101 F.3d 984, 990-91 (4th Cir. 1996) (following three other 
    circuits). These courts held that the statute requires, for purposes of 
    calculating the Medicaid fraction, inclusion of each patient day of 
    service for which a patient was eligible on that day for medical 
    assistance under an approved State Medicaid plan. Specifically, the 
    statute requires inclusion of each hospital patient day for a patient 
    eligible for Medicaid on such day, regardless of whether particular 
    items or services were covered or paid under the State Medicaid plan.
        On February 27, 1997, the HCFA Administrator issued HCFA Ruling 97-
    2, which acquiesced in the four adverse appellate court decisions. The 
    Ruling changed the agency's statutory construction to comport with 
    those decisions, in order to facilitate nationwide uniformity in the 
    calculation of the Medicaid fraction. Like the court decisions, the 
    Ruling provides that a hospital's Medicaid patient days include each 
    patient day of service for which a patient was eligible on such day for 
    medical assistance under an approved State Medicaid plan, regardless of 
    whether particular items or services were covered or paid under the 
    State plan. The Ruling also reflects the hospital's burden of 
    furnishing data adequate to prove each claimed Medicaid patient day, 
    and of verifying with the State that a patient was eligible for 
    Medicaid during each day of the inpatient hospital stay.
        The Ruling further provides that the agency's new interpretation is 
    effective February 27, 1997 for each cost reporting period that: (1) 
    Begins on or after that effective date; (2) was not settled, as of that 
    date, on the Medicaid patient days issue, by means of an applicable 
    notice of program reimbursement (NPR) (see Sec. 405.1803); or (3) was 
    settled through such an NPR
    
    [[Page 25595]]
    
    as of the Ruling's effective date and is the subject of a pending 
    administrative appeal or civil action that satisfies all applicable 
    jurisdictional requirements of the Medicare statute and regulations. 
    The Ruling also provides, however, that the change in statutory 
    interpretation effected by the Ruling is not a basis for reopening a 
    hospital cost reporting period (see Secs. 405.1885-405.1889) that was 
    finalized previously on the same matter at issue.
        We propose to revise Sec. 412.106(b)(4) in order to conform the 
    Medicare regulations to the new statutory construction issued in HCFA 
    Ruling 97-2. The revisions are necessary to ensure that the regulations 
    comport with the four appellate court decisions that declared invalid 
    the agency's prior interpretation and led to the issuance of the HCFA 
    Ruling. The proposed revisions will further facilitate nationwide 
    uniformity in the calculation of the Medicaid fraction.
        Since the proposed revisions are intended simply to conform the 
    regulations to HCFA Ruling 97-2 (and hence to the four adverse court 
    decisions), revised Sec. 412.106(b)(4) would reiterate the Ruling's 
    change of interpretation that the Medicaid fraction under section 
    1886(d)(5)(F)(vi)(II) of the Act includes each hospital patient day for 
    a patient eligible for Medicaid on such day, regardless of whether 
    particular items or services were covered or paid under the State 
    Medicaid Plan. Our proposed revisions to Sec. 412.106(b)(4), like the 
    Ruling, would continue to place on the hospital the burdens of 
    production, proof, and verification as to each claimed Medicaid patient 
    day.
        Under our proposal, revised Sec. 412.106(b)(4) would apply to cost 
    reporting periods beginning on or after October 1, 1998. HCFA Ruling 
    97-2, which includes the same provisions as proposed 
    Sec. 412.106(b)(4), would continue to apply to any cost reporting 
    period beginning before October 1, 1998 provided that, as of February 
    27, 1997, there is for such period: no submitted cost report; no cost 
    report settled on the Medicaid patient days issue through an applicable 
    NPR; or a cost report settled on that issue, which is also the subject 
    of a jurisdictionally proper administrative appeal or civil action on 
    the issue.
    
    D. Payment for Bad Debts (Sec. 413.80)
    
        Section 4451 of the Balanced Budget Act of 1997 reduces the payment 
    for enrollee bad debt for hospitals. Specifically, this provision 
    reduces the amount of bad debts otherwise treated as allowable costs, 
    attributable to the deductibles and coinsurance amounts under this 
    title, by 25 percent for cost reporting periods beginning during fiscal 
    year 1998, by 40 percent for cost reporting periods beginning during 
    fiscal year 1999, and by 45 percent for cost reporting periods 
    beginning during a subsequent fiscal year. This proposed rule would 
    conform the regulations to the statute.
        Section 4451 of the Balanced Budget Act of 1997 also provides that 
    in determining such reasonable costs for hospitals, any copayments 
    reduced under the election available for hospital outpatient services 
    under section 1833(t)(5)(B) of the Act will not be treated as a bad 
    debt. This provision will be implemented in the outpatient prospective 
    payment system regulation that implements section 4521, 4522, and 4523 
    of the Balanced Budget Act of 1997, to be published later this year.
    
    E. Payment for Direct Costs of Graduate Medical Education to Hospitals 
    and Nonhospital Providers (Secs. 405.2468, 413.85, and 413.86)
    
    1. Introduction
        Currently, under section 1886(h) of the Act, Medicare pays only 
    hospitals for the costs of graduate medical education (GME) training. 
    We do not pay nonhospital sites for the costs they incur in training 
    medical residents. There has been a general trend to shift patient care 
    from the inpatient setting to the less expensive nonhospital setting 
    where appropriate. Consistent with this trend in patient care, the BBA 
    allows for direct GME payment to qualified nonhospital providers to 
    encourage more training of future physicians in nonhospital settings.
        Under section 1886(k) of the Act, as added by section 4625 of the 
    BBA, the Secretary is now authorized, but not required, to pay 
    qualified nonhospital providers for the direct costs of GME training. 
    The Conference Report also notes that the Conferees believe paying 
    nonhospital providers for GME costs may help alleviate physician 
    shortages in underserved rural areas. We believe that providing 
    Medicare payment directly to nonhospital providers may facilitate more 
    training and better quality training in nonhospital sites.
    2. Statutory Background
        Section 1886(k) of the Act states: ``For cost reporting periods 
    beginning on or after October 1, 1997, the Secretary may establish 
    rules for payment to qualified nonhospital providers for their direct 
    costs of medical education, if those costs are incurred in the 
    operation of an approved medical residency training programs described 
    in subsection (h).'' The statute further provides that, to the extent 
    the Secretary exercises this broad discretionary authority, the rules 
    ``shall specify the amounts, form, and manner in which such payments 
    will be made and the portion of such payments that will be made from 
    each of the trust funds under this title.''
        a. Payments Only to ``Qualified Nonhospital Providers''. The 
    statute confers broad discretion on the Secretary regarding whether and 
    how to pay nonhospital providers for direct GME costs. However, the 
    statute does specify the entities whom the Secretary can pay--
    ``qualified nonhospital providers.'' Section 1886(k)(2) of the Act 
    defines ``qualified nonhospital providers'' to include: Federally 
    Qualified Health Centers (FQHCs), as defined in section 1861(aa)(4); 
    Rural Health Centers (RHCs), as defined in section 1861(aa)(2); 
    Medicare+Choice organizations; and such other providers (other than 
    hospitals) as the Secretary determines to be appropriate.
        b. Payments Only for the ``Direct Costs'' of Training. The statute 
    also specifies the costs the Secretary can pay for under section 
    1886(k) of the Act. Medicare pays hospitals for both the direct and 
    indirect costs of medical education under sections 1886(h) and 
    1886(d)(5)(B) of the Act respectively, but section 1886(k) of the Act 
    provides for payment to nonhospital providers only for the direct costs 
    of medical education.
        In addition, section 1886(k) of the Act provides for payment for 
    the direct costs of training medical residents only if those costs are 
    incurred in the operation of an ``approved medical residency training 
    program.'' Section 1886(h)(5)(A) of the Act defines an ``approved 
    medical residency training program'' as a ``residency or other 
    postgraduate medical training program participation in which may be 
    counted toward certification in a specialty or subspecialty and 
    includes formal postgraduate training programs in geriatric medicine 
    approved by the Secretary.'' Implementing regulations at Sec. 413.86(b) 
    state that an approved medical residency training program includes 
    allopathic and osteopathic training programs as well as training 
    programs for dentistry and podiatry. Therefore, the statute authorizes 
    Medicare payments to nonhospital providers only for the costs of 
    training medical residents, not for the costs of training other health 
    professionals.
        In addition to adding section 1886(k) of the Act, section 4625 of 
    the BBA amends section 1886(h)(3)(B) of the Act to prohibit double 
    payments for direct
    
    [[Page 25596]]
    
    GME to a hospital and a qualified nonhospital provider. This 
    prohibition on double payments requires that the Secretary reduce a 
    hospital's GME payments (the ``aggregate approved amount'' as defined 
    in section 1886(h)(3)(b) of the Act) to the extent we pay a nonhospital 
    provider for GME under section 1886(k) of the Act.
    3. Proposed Policies
        Pursuant to section 4625 of the BBA, we are proposing policies to 
    provide Medicare payment to nonhospital providers for the direct costs 
    of GME training, effective for portions of cost reporting periods 
    occurring on or after January 1, 1999. We believe that these payments 
    will serve the Congressional intent to encourage and support training 
    in nonhospital settings.
        a. Definition of ``Qualified Non-Hospital Providers''. Under our 
    proposed policy, Medicare would make GME payments to the following 
    ``qualified nonhospital providers''--FQHCs, RHCs, and Medicare+Choice 
    organizations. Under the authority of section 1886(k)(2)(D) of the Act, 
    the Secretary may expand the definition of a ``qualified nonhospital 
    provider'' to include such other providers (other than hospitals) as 
    the Secretary determines to be appropriate. Once we have gained 
    experience providing direct GME payments to FQHCs, RHCs, and 
    Medicare+Choice organizations, we may consider including other types of 
    nonhospital providers in the definition of a ``qualified nonhospital 
    provider.''
        Additionally, we propose that, under certain circumstances, a 
    hospital may continue to receive GME payments for residents who train 
    in the nonhospital setting. In those instances where a hospital is 
    eligible to continue receiving GME payments for residents who train in 
    the nonhospital setting, the nonhospital provider could receive payment 
    from the hospital for costs they incur in training medical residents. 
    Thus, our policy promotes the intent of section 4625 of the BBA to 
    provide financial support, either directly from Medicare or through the 
    hospital, to nonhospital providers for the direct costs of training 
    residents in the nonhospital site.
        b. Definition of ``Direct Costs'' of Medical Education for Non-
    Hospital Providers. Section 4625 of the BBA provides for payment to 
    nonhospital providers only for the direct costs of training residents. 
    Our proposed definition of ``direct costs'' for nonhospital providers 
    is comparable to the direct costs for hospitals under section 1886(h) 
    of the Act. Under our proposed policy, direct GME costs are those costs 
    that are incurred by the nonhospital site for the education activities 
    of the approved program and that are the proximate result of training 
    medical residents in the nonhospital site. Direct costs for nonhospital 
    providers would include:
         Residents' salaries and fringe benefits (including related 
    travel and lodging expenses where applicable);
         That portion of costs of the teaching physicians' salaries 
    and fringe benefits that are related to the time spent in teaching and 
    supervision of residents; and
         Other related GME overhead costs.
        Consistent with our policies on direct GME costs for hospitals, 
    direct GME costs for nonhospital providers would not include normal 
    operating costs or the marginal increase in costs that the nonhospital 
    site experiences as a result of having an approved medical residency 
    training program. For example, a decrease in productivity and increased 
    intensity in treatment patterns as the result of a training program do 
    not constitute ``direct costs'' of training residents in the 
    nonhospital setting; rather, these are the ``indirect costs'' of such 
    training.
        Also consistent with our policies for direct GME payments to 
    hospitals, we propose to pay qualified nonhospital providers only for 
    training that is related to the delivery of patient care services. 
    Sections 1886(h) (``Payments for Direct GME Costs'') and 1886(h)(4)(E) 
    of the Act (``Counting Time Spent in Outpatient Settings'') provide 
    support continuing our longstanding policy of paying only for training 
    that is associated with patient care services. In particular, section 
    1886(h)(4)(E) of the Act states:
    
        Such rules shall provide that only time spent in activities 
    relating to patient care shall be counted and that all the time so 
    spent by a resident under an approved medical residency training 
    program shall be counted towards the determination of full-time 
    equivalency, without regard to the setting in which the activities 
    are performed, if the hospital incurs all, or substantially all, of 
    the costs for the training program in that setting.
    
    In addition, section 1861(b) of the Act describes the types of patient 
    care services that are reimbursable. Specifically, section 1861(b)(6) 
    of the Act indicates that the training of interns or residents under an 
    approved teaching program are included as reimbursable patient care 
    costs.
        Moreover, direct GME costs for nonhospital providers, like direct 
    GME costs for hospitals, would include only that portion of costs of 
    the teaching physicians' salaries and fringe benefits associated with 
    time spent in teaching and supervising residents. Specifically, a 
    teaching physician's time spent on teaching of a general nature would 
    constitute a direct GME cost, while teaching of a patient-specific 
    nature would not constitute a direct cost. In addition, direct costs in 
    the nonhospital setting would include that portion of teaching 
    physicians' salaries and fringe benefits associated with time spent 
    developing resident schedules and evaluating or rating the residents. 
    Direct costs would also include a teaching physician's office costs 
    allocated to GME.
        By contrast, direct GME costs for nonhospital providers would not 
    include the following: A teaching physician's time spent in the care of 
    individual patients which results in billable services; teaching 
    physicians' activities that are related to the education of other 
    health professionals (i.e., classroom instruction in connection with 
    approved activities other than GME such as provider-operated nursing 
    programs); teaching physicians' time spent on administrative and 
    supervisory services to the provider that are unrelated to approved 
    educational activities (i.e. operating costs); and teaching physician 
    activities that involve nonallowable costs such as research and medical 
    school activities that are not related to patient care in the 
    nonhospital setting.
        GME overhead costs include only those costs that are allocable to 
    direct GME and that are not used in patient care. For example, a 
    portion of administrative and general costs could be appropriately 
    allocated to an RHC or FQHC's GME cost center. Similarly, a conference 
    room that is dedicated specifically for the training of residents could 
    be appropriately allocated to an RHC or FQHC's GME cost center. By 
    contrast, patient care rooms added to an RHC or an FQHC cannot be 
    appropriately allocated to an RHC or FQHC's GME cost center.
        One of the advantages of our proposed definition of ``direct 
    costs'' is that it is administratively feasible. Our definition of 
    ``direct costs'' for nonhospital providers is comparable to the direct 
    costs that are included in the per resident amount paid to hospitals 
    under section 1886(h) of the Act. At present, there is limited 
    information regarding the actual costs of training residents in 
    nonhospital sites. After we gain experience providing direct GME 
    payments to qualified nonhospital providers and have reviewed the GME 
    costs separately reported by these nonhospital providers, we may revise 
    the definition of ``direct costs.'' We are
    
    [[Page 25597]]
    
    soliciting comments on other elements that may constitute direct costs 
    of GME in the nonhospital site that can be identified, reported, and 
    verified as directly attributable to GME activities through the cost 
    reporting process. We are interested in comments on whether we should 
    include other costs in the definition of ``direct costs'' for 
    nonhospital providers and on the administrative feasibility of 
    identifying the GME portion of those costs.
        c. Determining Direct Costs. One of our major concerns in 
    developing policies for paying nonhospital providers for the direct 
    costs of GME is the administrative feasibility of determining the 
    amount of direct costs incurred by the nonhospital provider. It is our 
    understanding that, currently, hospitals and nonhospital sites often 
    share, to varying degrees, the costs of training residents in the 
    nonhospital site. Because of the difficulty in apportioning costs 
    between the hospital and the nonhospital for the training in the 
    nonhospital site, we believe that it is not administratively feasible 
    to pay both the hospital and the nonhospital site for the cost of 
    training in the nonhospital site. We have been unable to devise a 
    method for accurately apportioning costs between the two entities.
        Furthermore, the potential for both the hospital and the 
    nonhospital site to be paid for the same direct GME expenses poses a 
    significant problem for complying with section 1886(h)(3)(B) of the 
    Act, as amended by the BBA, which specifically prohibits double 
    payments. Under this provision, the Secretary shall reduce the 
    hospital's GME payment (the ``aggregate approved amount'') to the 
    extent we pay nonhospital providers for GME costs under section 1886(k) 
    of the Act. Consequently, our policy must ensure that Medicare does not 
    pay two entities for the same training time in the nonhospital site.
        Given that the hospital's per resident amount can include, but is 
    not necessarily based on the costs of training in the nonhospital site, 
    we were not able to devise an equitable way of reducing the hospital's 
    per resident payment to reflect payments made under section 1886(k) of 
    the Act. It would not be equitable to subtract the exact amount of 
    payment made to the qualified nonhospital provider from the hospital's 
    per resident payment because the payment made to the nonhospital site 
    is unrelated to the hospital's per resident amount. The hospital per 
    resident amount is based on specific GME costs incurred by the hospital 
    in the 1984 base year. Those costs included in the per resident amount 
    have no relevance to the costs incurred in the nonhospital setting 
    almost 15 years after the 1984 base year. We believe that the 
    residents' salaries, teaching physicians' salaries, and overhead costs 
    for the nonhospital setting will constitute a different proportion of 
    the total GME costs in the nonhospital setting as compared with the 
    hospital setting. Rather, it would be more equitable to determine the 
    proportion of costs incurred by each entity and reduce the hospital's 
    per resident payment by the proportion of GME costs incurred by the 
    nonhospital site; however, since specific components of the per 
    resident amount were not identified in the hospital's GME base year 
    (1984), we cannot accurately determine the appropriate amount to reduce 
    the current year hospital per resident payment amount. Moreover, to 
    reduce the hospital's GME payments based solely on the amount paid to 
    the nonhospital site could result in inequitable payments to the 
    hospital, which has ongoing costs even when the resident is training in 
    the nonhospital site. In fact, it could leave the hospital at risk of 
    receiving no payment for the GME costs it has incurred.
        In order to encourage training in nonhospital sites, it is 
    important to develop a policy that, while providing payment to 
    nonhospital providers, would also be equitable to hospitals. We believe 
    that paying only the nonhospital site for the training costs could 
    result in hospitals choosing not to rotate their residents to the 
    nonhospital site. We have been unable to devise an equitable and 
    accurate method for dividing up the GME payment for training in the 
    nonhospital site if neither the hospital, nor the nonhospital site 
    incurs ``all or substantially all'' of the costs. As such, we are 
    soliciting comment on possible methods for allocating the GME payments 
    for training in the nonhospital site where neither the hospital nor the 
    nonhospital provider is incurring ``all or substantially all'' of the 
    costs for the training program. We believe that the proposed policies 
    discussed below are equitable to both hospital and nonhospital 
    providers and will achieve Congress' objective of encouraging and 
    supporting training in the nonhospital setting.
        Given our concerns about administrative feasibility, the statutory 
    prohibition on double payments, and developing policies that are 
    equitable to hospitals as well as nonhospital providers, we believe the 
    only feasible way to pay for training in nonhospital settings is to pay 
    either the hospital or the nonhospital provider. Currently, hospitals 
    may receive payment for the time residents spend in the nonhospital 
    setting if the hospital incurs ``all or substantially all'' of the 
    training costs. We propose to adopt a similar policy for nonhospital 
    providers; that is, a qualified nonhospital provider may receive 
    payment for the direct costs of GME if the nonhospital provider incurs 
    ``all or substantially all'' of the training costs.
        d. Modifications of Policy To Pay Hospitals For GME. In the course 
    of developing our policies for nonhospital providers, we have reviewed 
    our method for paying hospitals for the costs of training residents in 
    the nonhospital site. Accordingly, as part of our policy to pay 
    nonhospital providers for the costs of training residents, we are 
    proposing necessary and appropriate modifications to our current policy 
    for paying hospitals for such nonhospital training. Specifically, as 
    part of our proposal to implement section 1886(k) of the Act, we 
    propose to modify the regulations at Sec. 413.86(f).
        Presently, under sections 1886(d)(5)(B)(iv) and 1886(h)(4)(E) of 
    the Act, if a hospital incurs ``all or substantially all'' of the costs 
    of training residents in the nonhospital site, then the hospital may 
    include the resident in its indirect medical education (IME) and direct 
    GME full-time equivalent count. Under Sec. 413.86(f)(1)(iii), currently 
    a hospital incurs ``all or substantially all'' of the costs of training 
    the resident in the nonhospital site if the hospital pays the 
    residents' salaries and fringe benefits. Based on our review of data in 
    Medicare cost reports on the Hospital Cost Reporting Information System 
    (HCRIS), we decided to reexamine the issue of what constitutes ``all or 
    substantially all'' of the costs of training the resident. In our 
    analysis, we determined that, on average, residents' salaries and 
    fringe benefits are less than half of the total amount of the direct 
    costs of a hospital's GME program. Therefore, we are proposing to 
    revise the standard for incurring ``all or substantially all'' of the 
    costs for the training program in the nonhospital setting.
        We propose to redefine ``all or substantially all'' of the costs 
    for the training program in the nonhospital setting to include at a 
    minimum:
         the portion of costs of the teaching physicians' salaries 
    and fringe benefits that are related to the time spent in teaching and 
    supervision of residents; and
         residents' salaries and fringe benefits (including travel 
    and lodging expenses where applicable).
        e. Payment Proposal. In light of the numerous considerations 
    discussed
    
    [[Page 25598]]
    
    above, we are proposing a system whereby we will pay either the 
    hospital or the nonhospital site for the cost of training in the 
    nonhospital site, depending on which entity incurs ``all or 
    substantially all'' of the costs of training in the nonhospital site. 
    An entity incurs ``all or substantially all'' of the costs for the 
    training program in the nonhospital setting if it pays for, at a 
    minimum: that portion of the costs of the teaching physicians' salaries 
    and fringe benefits that are related to the time spent in teaching and 
    supervision of residents; and residents' salaries and fringe benefits 
    (including travel and lodging expenses where applicable). Our proposal 
    accommodates three alternative payment scenarios that are discussed 
    below.
        i. Payment to FQHCs and RHCs. In the first payment scenario, if the 
    FQHC or RHC incurs ``all or substantially all'' of the costs for the 
    training program in the nonhospital setting, we are proposing to pay 
    the nonhospital site cost-based reimbursement for the direct costs of 
    training. By reporting these direct GME costs in a reimbursable cost 
    center on the cost report, an FQHC or RHC would be attesting that it is 
    incurring ``all or substantially all'' of the costs for the training 
    program in the nonhospital site. Conversely, where an FQHC or RHC is 
    not incurring ``all or substantially all'' of the costs of training 
    residents in the nonhospital site, the FQHC or RHC would report these 
    training costs in a nonreimbursable cost center on the cost report.
        As previously stated, we propose to define the direct costs of 
    training to include:
         Residents' salaries and fringe benefits (including related 
    travel and lodging expenses where applicable);
         That portion of the costs of teaching physicians' salaries 
    and fringe benefits that are related to the time spent in teaching and 
    supervision of residents; and
         Other related overhead costs that are allocated to GME.
        We are proposing that the FQHC's and RHC's allowable direct GME 
    costs be subject to reasonable cost principles in 42 CFR part 413 and 
    other relevant provisions referenced in part 413. As such we are 
    proposing to add language to Sec. 415.60 to make the reasonable cost 
    principles applicable to FQHC's and RHC's. In addition, the FQHC's and 
    RHC's direct GME costs would be subject to the Reasonable Compensation 
    Equivalency limits under Secs. 415.60 and 415.70. Accordingly, we are 
    proposing to add language to Sec. 415.70 to make the reasonable 
    compensation equivalency limits applicable to FQHC's and RHC's.
        Also, Medicare would pay only for Medicare's share of the direct 
    costs of training in the nonhospital site. We are proposing that the 
    FQHC's and RHC's Medicare share equal the nonhospital provider's ratio 
    of Medicare visits to total visits. Thus, the amount of Medicare 
    payment would equal the product of the clinic's Medicare allowed direct 
    GME costs and the clinic's ratio of Medicare visits to total visits.
        For FQHCs and RHCs that incur ``all or substantially all'' of the 
    costs for the training program in the nonhospital setting, the direct 
    GME costs are not subject to the existing per visit payment caps for 
    reimbursement under sections 505.1 and 505.2 of the Medicare Rural 
    Health Clinic and Federally Qualified Health Centers Manual. Moreover, 
    we believe participation in GME training should not affect any FQHCs or 
    RHCs ability to meet the productivity standards outlined in section 503 
    of the Medicare Rural Health Clinic and Federally Qualified Health 
    Centers Manual. Therefore, we are proposing that, where payment is 
    available under section 1886(k) of the Act for residents working in 
    either an FQHC or an RHC, the FQHCs and RHCs do not need to include 
    residents as health care staff in the calculation of productivity 
    standards under section 503 of the Manual.
        ii. Payment to Medicare+Choice organizations. In the second payment 
    scenario, if a Medicare+Choice organization incurs ``all or 
    substantially all'' of the costs for the training program in the 
    nonhospital setting, we propose making the direct GME payment to the 
    Medicare+Choice organization. The Medicare+Choice organization would be 
    eligible to receive cost-based reimbursement for the residents' 
    salaries and fringe benefits only for the time that the resident spends 
    in the nonhospital setting. In addition, we are proposing that the 
    Medicare+Choice organization's allowed costs include only that portion 
    of the teaching physician salaries and fringe benefits that is related 
    to training in the nonhospital setting.
        Unlike our proposed policy in paying FQHCs and RHCs for GME, at 
    this time we are not proposing to pay Medicare+Choice organizations for 
    the costs of overhead that are directly associated with a GME program. 
    We have no historical data on the GME costs of managed care 
    organizations and the extent to which these costs are incurred directly 
    or indirectly under contracts between the managed care organization and 
    physician groups or other providers engaged in ambulatory care. 
    Moreover, we have an established methodology for allocating and 
    reporting overhead costs for FQHCs and RHCs on Medicare cost reports 
    that does not currently exist for Medicare+Choice organizations. Since 
    Medicare+Choice organizations do not use the Medicare cost report, 
    there is currently no mechanism to review and audit these costs in the 
    managed care context. Because Medicare+Choice organizations are paid on 
    a capitated basis, we have no method for paying Medicare+Choice 
    organizations for variable costs such as GME overhead that require a 
    sophisticated cost allocation methodology. By contrast, it is currently 
    feasible to pay Medicare+Choice organizations for the costs of the 
    residents' salaries and teaching physicians' salaries because those 
    costs are more readily documented and auditable.
        However, we are open to suggestions about how we can create a 
    methodology for allocating and reporting overhead costs for 
    Medicare+Choice organizations. Any comments should include not only a 
    proposed methodology for paying Medicare+Choice organizations for GME 
    overhead costs, but also proposed mechanisms for the audit and review 
    of the costs of these organizations.
        Similar to our proposed policy for paying FQHCs and RHCs for direct 
    costs of GME, the Medicare+Choice organization's reimbursement for 
    residents' salaries and fringe benefits (including related travel and 
    lodging expenses where applicable) would be subject to the reasonable 
    cost principles in 42 CFR part 413 and any other relevant provisions 
    referenced in part 413. As such we are proposing to add language to 
    Sec. 415.60 to make the reasonable cost principles applicable to 
    Medicare+Choice organizations. In addition, the Medicare+Choice 
    organization's GME reimbursement would also be subject to the 
    Reasonable Compensation Equivalency limits under Secs. 415.60 and 
    415.70. Accordingly, we are proposing to add language to Sec. 415.70 to 
    make reasonable compensation equivalency limits applicable to 
    Medicare+Choice organizations. While we would pay the Medicare+Choice 
    organization for certain GME costs in nonhospital settings under this 
    proposal, the cost of residents' and teaching physicians' salaries and 
    fringe benefits in the hospital setting would be paid to the hospital, 
    not the Medicare+Choice organization.
        The Medicare+Choice organization would receive direct GME payment 
    only for the direct costs of training in the nonhospital site that are 
    associated with the delivery of patient care services. In
    
    [[Page 25599]]
    
    determining the amount of direct GME payments to Medicare+Choice 
    organizations, we must adjust for Medicare's share of those education 
    costs. Medicare's share would equal the ratio of the total number of 
    Medicare enrollees in the Medicare+Choice organization to total 
    enrollees in the Medicare+Choice organization.
        We are proposing that, in order to receive the direct GME payment, 
    the Medicare+Choice organization must produce a contractual agreement 
    between itself and the nonhospital providers. Medicare+Choice 
    organizations may contract with any nonhospital patient care site, 
    including freestanding clinics, nursing homes, and physicians' offices 
    in connection with approved programs. The contract between the 
    Medicare+Choice organization and the nonhospital site must indicate 
    that, for the time that residents spend in the nonhospital site, the 
    Medicare+Choice organization agrees to pay for the cost of residents' 
    salaries and fringe benefits. In addition, the contract must indicate 
    that the Medicare+Choice organization agrees to pay the portion of the 
    costs of teaching physicians' salaries and fringe benefits that is 
    related to the time spent in teaching and supervision of residents and 
    that is unrelated to the volume of services. The contract must 
    stipulate the portion of each teaching physician's time that will be 
    spent training residents in the nonhospital setting. Moreover, the 
    contract must indicate that the Medicare+Choice organization agrees to 
    identify an amount for the cost of the teaching physician's salary 
    based on the time that the resident spends in the nonhospital setting, 
    not based upon a capitated rate for the delivery of physician services.
        Under our proposed rule, we could pay a Medicare+Choice 
    organization for the direct costs of training medical residents in a 
    physician's office if such office had a contractual agreement with the 
    organization whereby the organization agrees to pay for ``all or 
    substantially all'' of the costs for the training program in the 
    nonhospital setting. However, an independent physician office would not 
    be eligible to receive payment directly from Medicare for the cost of 
    training residents because it would not be a ``qualified nonhospital 
    provider'' under our proposed policy. Similarly, if a hospital rotates 
    a resident through a physician's office, the hospital must pay for 
    ``all or substantially all'' of the costs of training the resident in 
    the physician's office in order to include that resident in its FTE 
    count for IME and direct GME purposes. (In this instance, the 
    hospital's responsibility in assuming ``all or substantially all'' of 
    the costs of training the resident in the nonhospital site would not be 
    based on section 4625 of BBA which permits payment to nonhospital 
    providers.) The hospital would have to assume ``all or substantially 
    all'' of the training costs for that nonhospital training time in order 
    to avail itself of the benefit of including the resident in the 
    hospital's FTE count for IME and direct GME purposes based on the 
    proposed modifications to Sec. 413.86.
        iii. Payment to Hospitals. In the third payment scenario, if the 
    hospital itself incurs ``all or substantially all'' of the costs for 
    the training program in the nonhospital setting, then the hospital may 
    include the residents' training time in the nonhospital setting in the 
    hospital's FTE counts for direct GME and for IME. In order to include 
    the residents' training in the nonhospital site, the hospital must 
    produce a contractual agreement between the hospital and the 
    nonhospital provider. Under Sec. 413.86(f)(1)(iii), hospitals may 
    contract with any nonhospital patient care provider such as 
    freestanding clinics, nursing homes, and physicians' offices in 
    connection with approved programs.
        Currently, a hospital must produce a written agreement between the 
    hospital and the nonhospital provider that states that the resident's 
    compensation for training time spent outside of the hospital setting is 
    to be paid by the hospital. Since this proposal changes the definition 
    of what constitutes ``all or substantially all'' of the costs of 
    training in the nonhospital site, hospitals must produce a written 
    agreement that demonstrates that they are assuming responsibility for 
    more of the costs of training in the nonhospital site than had 
    previously been required.
        In accordance with our proposed definition of what constitutes 
    ``all or substantially all'' of the costs of training while the 
    resident is in the nonhospital site, we are proposing that the contract 
    must indicate that the hospital is assuming financial responsibility 
    for, at a minimum, the cost of residents' salaries and fringe benefits 
    (including travel and lodging expenses where applicable) and the costs 
    for that portion of teaching physicians' salaries and fringe benefits 
    related to the time spent in teaching and supervision of residents.
        The contract must indicate that the hospital is assuming financial 
    responsibility for these costs directly or that the hospital agrees to 
    reimburse the nonhospital provider for such costs. The contract must 
    also contain an acknowledgment on the part of the nonhospital provider 
    that, since the residents' time is being counted by the hospital, the 
    nonhospital site cannot claim GME costs on their Medicare cost report. 
    The nonhospital provider must agree to report its direct GME costs as 
    well as any money received from the hospital for GME purposes in a 
    nonallowable cost center on its cost report. In addition, in order to 
    determine teaching physician compensation that may be allocated to 
    direct GME, the nonhospital provider must specify the portion of the 
    teaching physicians' time that will be spent training residents in the 
    nonhospital setting. Finally, any payment to the hospital for the 
    direct costs of GME training in the nonhospital setting will continue 
    to reflect Medicare's share, which equals the hospital's ratio of 
    Medicare inpatient days to total inpatient days.
        Hospitals that have residents who rotate to nonhospital sites are, 
    like all teaching hospitals, subject to an institutional cap on the 
    number of FTE residents that may be counted for both indirect and 
    direct GME under sections 1886(d)(5)(B)(v) and 1886(h)(6)(F) of the 
    Act. For hospitals that have residents who rotate to a nonhospital 
    site, those residents will be subject to the hospital's FTE caps.
        f. Trust Funds. Under section 1886(k)(1) of the Act, the rules 
    established by the Secretary for paying nonhospital providers for GME 
    must specify the portion of Medicare payments that will be made from 
    each of the Medicare trust funds. We propose that GME payments made 
    directly to an FQHC, RHC, or Medicare+Choice organization would be made 
    from the Federal Supplementary Medical Insurance Trust Fund.
        g. Conclusion. Under this proposed rule, clinics that are presently 
    ineligible to receive payments for direct GME may now receive such 
    payments. Moreover, this proposal provides Medicare+Choice 
    organizations the opportunity to receive direct GME payments for 
    training residents in the nonhospital setting. As Medicare+Choice 
    organizations, managed care entities will, for the first time, be 
    eligible to receive direct GME payments for training residents in 
    various types of nonhospital sites. This proposed rule would help 
    bridge the disparity between hospital and nonhospital providers in 
    obtaining payment for direct GME costs.
        We believe this proposed rule may encourage the development of new 
    programs in nonhospital settings. Similarly, it may also encourage 
    approved residency training programs to
    
    [[Page 25600]]
    
    rotate additional residents to nonhospital sites.
        In developing this proposed rule, we considered establishing a 
    fixed payment rate for the direct costs of training residents in the 
    nonhospital setting. We are not proposing a policy of a fixed payment 
    at this time because we presently have no reliable data on the direct 
    costs of training residents in nonhospital settings. Moreover, we are 
    concerned that a fixed payment for these costs may not be appropriate 
    if there is significant variation in cost among participating 
    nonhospital sites.
        Given these considerations, our policy to pay FQHCs, RHCs, and 
    Medicare+Choice organizations on a cost reimbursement basis may be 
    revised in the future. Once we have acquired data such that we can 
    estimate the direct costs of training residents in the nonhospital 
    site, we will revisit our payment methodology for paying FQHCs, RHCs, 
    and Medicare+Choice organizations for direct GME. We believe that 
    ultimately it might be appropriate to pay FQHCs, RHCs, and 
    Medicare+Choice organizations using a national average per resident 
    amount. This national per resident amount would be based on the 
    national average for the direct costs of training medical residents in 
    the nonhospital site. As such, we are interested in receiving comments 
    on a fixed payment methodology and on how to derive such a payment. 
    These comments should include empirical data on training costs in 
    nonhospital sites.
        The effective date of these provisions for FQHCs, RHCs, 
    Medicare+Choice organizations, and hospitals will be January 1, 1999. 
    In particular, the effective date for IME payments to hospitals under 
    this provision applies to discharges occurring on or after January 1, 
    1999. In addition, the effective date for direct medical education 
    payments to FQHCs, RHCs, Medicare+Choice organizations, and hospitals 
    applies to that portion of cost reporting periods occurring on or after 
    January 1, 1999.
    
    VI. Changes to the Prospective Payment System for Capital-Related 
    Costs
    
    A. Proposed Cap on the Capital Indirect Medical Education Adjustment 
    Ratio (Sec. 417.322)
    
        Under section 1886(g) of the Act, the Secretary has broad 
    discretion in implementing the capital prospective payment system. 
    Section 412.322 of the regulations specifies the formula for the 
    capital indirect medical education (IME) adjustment factor. The capital 
    IME adjustment is intended to pay the capital prospective payment 
    system share of the indirect costs of medical education to teaching 
    hospitals. The formula was adopted in the August 30, 1991 final rule 
    for the capital prospective payment system (56 FR 43380) and uses the 
    ratio of interns and residents to average daily census (defined as 
    total inpatient days divided by the number of days in the cost 
    reporting period). Section 1886(d)(5)(B) of the Act requires the use of 
    the ratio of residents-to-beds to calculate the IME adjustment for the 
    operating Prospective payment system. However, pursuant to our 
    authority under section 1886(g) of the Act, we adopted the resident to 
    average daily census ratio for the capital prospective payment system 
    because we believed it was a more appropriate method for measuring 
    teaching intensity and because we believed it was less subject to 
    manipulation.
        The IME adjustment factor increases by approximately 2.8 percentage 
    points for each .10 increase in the hospital's ratio of residents to 
    average daily census. The IME adjustment for inpatient capital-related 
    costs for hospitals paid under the prospective payment system takes the 
    form of e raised to the power (.2822  x  ratio of interns and residents 
    to average daily census)-1] where e is the natural antilogy of 1, based 
    on the total cost regression results. In order to determine the Federal 
    rate portion of the hospital's payment, the IME adjustment factor is 
    multiplied by the standard federal rate, the DRG weight, the geographic 
    adjustment factor, and any other relevant payment adjustments such as 
    the DSH adjustment or the large urban add-on. The formula is as 
    follows: (Standard Federal Rate)  x  (DRG weight)  x  (GAF)  x  (Large 
    Urban Add-on, if applicable)  x  (COLA adjustment for hospitals located 
    in Alaska and Hawaii)  x  (1 + Disproportionate Share Adjustment Factor 
    + IME Adjustment Factor, if applicable).
        It has come to our attention that because of the application of the 
    capital IME adjustment, one hospital would receive a capital IME 
    payment greater than its total hospital costs. We have also recently 
    learned that of the approximately 1,200 teaching hospitals in the 
    United States, based on December 1997 data, 8 hospitals have a resident 
    to average daily census ratio of more than 1.5. A resident to average 
    daily census ratio of 1.5 results in a capital IME adjustment factor of 
    .53, which increases the Federal rate portion of the hospital's capital 
    payment by 53 percent.
        To address this unintended effect of the capital IME methodology, 
    we are proposing to cap the capital IME ratio at 1.5. A ratio greater 
    than 1.5 means a hospital has, on average, considerably more residents 
    than inpatients. Capping the ratio at 1.5 would allow for one resident 
    per patient on the inpatient side plus some outpatient training, and 
    would keep capital IME payments more consistent with the costs 
    incurred. Because of the large number of unoccupied beds in most 
    hospitals, the operating IME ratio has only slightly exceeded 1.0 in 
    two cases. This change would ensure that the capital IME adjustment is 
    more in line with hospital costs.
    
    B. Payment Methodology for Mergers Involving New Hospitals 
    (Sec. 412.331)
    
        The August 30, 1991 final rule (56 FR 43418), which implemented the 
    capital prospective payment system, established special payment 
    provisions for new hospitals. Under Sec. 412.324(b), a new hospital is 
    paid 85 percent of its allowable Medicare capital-related costs through 
    its first cost reporting period ending at least 2 years after the 
    hospital accepts its first patient. The first cost reporting period 
    beginning at least 1 year after the hospital accepts its first patient 
    is the hospital's base year for purposes of determining its hospital-
    specific rate. Section 412.302(b) defines a new hospital's old capital 
    costs as allowable capital-related costs for land and depreciable 
    assets that were put in use for patient care on or before the last day 
    of the hospital's base year cost reporting period. Beginning with the 
    third year, the hospital is paid under the fully prospective or hold-
    harmless payment methodology, as appropriate. If the hospital is paid 
    under the hold-harmless payment methodology, the hospital's hold-
    harmless payments for its old capital costs can continue for up to 8 
    years.
        In the August 30, 1991 final rule, we defined a new hospital as one 
    that had operated (under previous or present ownership) for less than 2 
    years and did not have a 12-month cost reporting period that ended on 
    or before December 31, 1990. In the September 1, 1992 final rule (57 FR 
    39789), as a result of situations brought to our attention after 
    publication of the prospective payment system final rule, we clarified 
    the new hospital exemption under the capital prospective payment 
    system. We explained that the new hospital exemption would not apply to 
    a facility that opened as an acute care hospital if that hospital had 
    previously operated under current or prior ownership and had a historic 
    asset base. We also clarified that a hospital that replaced its entire 
    facility (with or without a change of ownership) would not qualify for 
    a
    
    [[Page 25601]]
    
    new hospital exemption and that a previously existing excluded hospital 
    (paid under section 1886(b) of the Act) that became an acute care 
    hospital (paid under section 1886(d)) of the Act would not qualify.
        We explained our belief that the reasonable cost payment protection 
    under the new hospital exemption should only be available to those 
    hospitals that had not received reasonable cost payments in the past 
    and needed special protection during their initial period of operation. 
    We also stated in the June 4, 1992 proposed rule (57 FR 23649) that we 
    were clarifying the new hospital exemption to ensure that hospitals 
    that had an existing asset base before December 31, 1990 were not 
    provided with an extended transition period and inappropriately higher 
    payments relative to other hospitals. We also explained our belief that 
    it was essential to maintain the integrity of the capital prospective 
    payment system by allowing only truly new providers of hospital care to 
    qualify for the new hospital exemption.
        Since publication of our last clarification of the payment rules 
    for new hospitals, questions have arisen regarding application of our 
    rules for payment of new hospitals in merger situations. Consistent 
    with our previously stated policy that only truly new hospitals without 
    an existing asset base should be eligible for the new hospital 
    exemption, we are further clarifying the new hospital payment 
    provisions.
        If during the period it is eligible for payment as a new hospital 
    (as defined at Sec. 412.300(b) and Sec. 412.328(b)), a new hospital 
    merges with one or more existing hospitals and the merger meets the 
    existing capital-related reasonable cost rules regarding the criteria 
    for recognizing a merger at Sec. 413.134 and the new hospital is the 
    surviving corporation (as defined in Sec. 413.134(l)(2)) we would treat 
    as old capital only those assets of the existing hospital that met the 
    definition of old capital (as defined in Sec. 412.302(b)) prior to the 
    merger, for purposes of determining payments after the merger.
        Any assets of the existing hospital that were considered new 
    capital prior to the merger will still be considered new capital after 
    the merger. The merger cannot be used to convert the existing 
    hospital's new capital into old capital. After the merger, the 
    discharges of each campus of the merged entity would maintain their 
    pre-merger payment methodology until the end of the 2 year period that 
    the ``new hospital'' campus was eligible for reasonable cost 
    reimbursement as defined at Sec. 412.324(b). At the end of this period, 
    the intermediary would devise a hospital specific rate for the ``new'' 
    campus of the merged hospital. Finally, the calculation methodology for 
    hospital mergers at new Sec. 412.331(a)(1) and (2) would be performed 
    and a combined hospital-specific rate would be determined and a payment 
    methodology selected for the merged hospital as a whole.
        The calculation at Sec. 412.331(a)(1) and (2) uses each hospital's 
    base year old capital costs. Any new capital of the previously existing 
    hospital would not be used in the determination. If the new merged 
    entity qualifies for the hold-harmless payment methodology, only the 
    capital which meets the definition of old capital at Sec. 412.302(b) 
    would be eligible for hold-harmless payments.
        We note that this proposed change is consistent with the principles 
    underlying existing Sec. 412.331(a)(3), which provides that in the case 
    of a merger only the existing capital-related costs related to the 
    assets of each merged or consolidated hospital as of December 31, 1990 
    are recognized as old capital costs during the transition period. If 
    the hospital is paid under the hold-harmless methodology after merger 
    or consolidation, only that original base year old capital is eligible 
    for hold-harmless payments.
    
        Example: Hospital A is a new hospital in its first 2 years of 
    operation and is being paid 85 percent of its allowable Medicare 
    inpatient hospital capital-related costs. Hospital A's base year for 
    establishing its hospital-specific rate will end September 30, 1998. 
    Hospital B is an existing hospital whose base year for capital 
    prospective payment system purposes was June 30, 1990. Hospital B is 
    a hold-harmless hospital paid 100 percent of the Federal rate. 
    Hospital A merged with Hospital B (in accordance with to 
    Sec. 413.134(l)) on March 1, 1998, and Hospital A is a new merged 
    entity, with two campuses: one which used to be the original 
    Hospital A--the ``new'' hospital, and one which used to be hospital 
    B--the ``existing'' hospital). The merged Hospital A retains the 
    corporate structure, provider number, and cost reporting period of 
    the original Hospital A, which is the surviving hospital. The merged 
    Hospital A's discharges will be paid under two different payment 
    methodologies until the ``new'' campus completes its base period 
    under the payment rules for new hospitals and a hospital-specific 
    rate and a payment methodology can be determined for the merged 
    Hospital A. Until that time, the discharges of the ``new'' hospital 
    campus (previously the original Hospital A) will be paid in 
    accordance with Sec. 412.324(b) as a new hospital. Any capital that 
    meets the definition of old capital acquired by the ``new'' campus 
    before the end of its base year will be accorded old capital status 
    in accordance with Sec. 412.302(b). The ``existing'' hospital campus 
    (previously hospital B) will continue to be paid on a hold-harmless 
    basis. Any capital acquired by the ``existing'' campus will be 
    accorded new capital status in accordance with section 2807.3A of 
    the Provider Reimbursement Manual (PRM). At the end of the ``new'' 
    campus' base year, a hospital-specific rate will be determined for 
    that campus. After a hospital specific rate is determined, the 
    calculation methodology for hospital mergers at Sec. 412.331(a)(1) 
    and (2) will be performed. As part of the calculation and before 
    combining the data, the base years of the two hospitals used to 
    establish the hospital-specific rate are brought to the same point 
    by discharge-weighting and updating. The calculation uses only the 
    old capital costs of each hospital in order to determine a combined 
    hospital-specific rate and payment methodology. After a payment 
    methodology determination is made, the two campuses will be paid 
    using the same payment methodology for all of their discharges.
    
    VII. Changes for Hospitals and Units Excluded From the Prospective 
    Payment System
    
    Limits on and Adjustments to the Target Amounts for Excluded Hospitals 
    and Units (Sec. 413.40(g))
    
    1. Updated Caps
        Section 1886(b)(3) of the Act as amended by section 4414 of the BBA 
    established caps on the target amounts for excluded hospitals and units 
    for cost reporting periods beginning on or after October 1, 1997, 
    through September 30, 2002. The caps on the target amounts apply to the 
    following three categories of excluded hospitals: psychiatric hospitals 
    and units, rehabilitation hospitals and units, and long-term care 
    hospitals.
        A discussion of how the caps on the target amounts were calculated 
    can be found in the August 29, 1997 final rule with comment period (62 
    FR 46018). For purposes of calculating the caps for cost reporting 
    periods beginning during FY 1999 through FY 2002, the statute requires 
    us to calculate the 75th percentile of the target amounts for each 
    class of hospital (psychiatric, rehabilitation, or long-term care) for 
    cost reporting periods ending during FY 1996. The resulting amounts are 
    updated by the market basket percentage to the applicable fiscal year.
        The projected market basket for excluded hospitals and units for FY 
    1999 is 2.5 percent. Accordingly, the caps on the target amount for FY 
    1999 as follows:
    
    (1) Psychiatric hospitals and units: $10,443
    (2) Rehabilitation hospitals and units: $18,938
    (3) Long-term care hospitals: $37,360
    
    [[Page 25602]]
    
    2. Classification of Hospitals and Units
        Since publication of the August 29, 1997 final rule with comment 
    period, some excluded facilities have suggested that if they are 
    currently excluded as one class of hospital or unit but also qualify 
    for exclusion as another class of hospital, they should be permitted to 
    choose which classification applies for purposes of applying the cap on 
    target amounts. For example, some hospitals that participate in 
    Medicare as psychiatric hospitals (defined under section 1861(f) of the 
    Act, and the special conditions of participation in 42 CFR part 482 
    subpart E) have noted that they have average lengths of stay greater 
    than 25 days. Those hospitals have asked to be ``reclassified'' as 
    long-term care hospitals and given the benefit of the higher cap on 
    target amounts applicable to that hospital class.
        We have considered these hospitals' suggestions, but we believe it 
    would not be appropriate to adopt them. Section 1886(b)(3)(H)(iv) of 
    Act makes it clear that each category of hospital and corresponding 
    units--psychiatric (section 1886(d)(1)(B)(I)), rehabilitation (section 
    1886(d)(1)(B)(ii)), and long-term care hospitals (section 
    1886(d)(1)(B)(iv)) is treated separately. We believe it is consistent 
    with effective implementation of this provision to prevent hospitals or 
    units that could potentially be assigned to more than one category of 
    excluded facility from choosing the category to which they wish to be 
    assigned. Even though some hospitals or units in one group might 
    potentially have been assigned to a different group, each group has its 
    own limit based on the target amounts for similarly classified 
    facilities. It would not be appropriate to apply a limit to a hospital 
    or unit based on the target amount derived from the cost experience of 
    differently classified hospitals and units.
        In addition, there are a number of hospitals that could potentially 
    move from the psychiatric hospital cap to the long-term care hospital 
    cap. This movement would have a significant impact on the 
    appropriateness of both caps. In the case of the psychiatric hospitals, 
    had those hospitals with the longest lengths of stay and therefore 
    higher per discharge target amount been excluded in the original 
    calculation of the caps, the cap for all remaining psychiatric 
    hospitals would invariably have been lower. Furthermore, had those 
    psychiatric hospitals been included in the calculation of the long-term 
    care hospital cap, that cap could also have been lower. To allow such a 
    significant change in the application of the caps is to raise a serious 
    question as to the appropriateness of the current caps for all 
    psychiatric and long-term care hospitals.
        Thus, to clarify the application of the caps, we propose to revise 
    Sec. 413.40(c)(4)(iii) to specify that, for purposes of that paragraph, 
    the classification of a hospital that was excluded from the prospective 
    payment system for its cost reporting period ending in FY 1996 will be 
    determined by its classification (that is, the basis on which it was 
    excluded) in FY 1996. If a hospital or unit was not excluded for a cost 
    reporting period ending in FY 1996 but could be excluded on more than 
    one basis (for example, as either a rehabilitation or long-term care 
    hospital) it will be assigned to the classification group with the 
    lowest limit.
    3. Exceptions
        The August 29, 1997 final rule with comment period (62 FR 46018) 
    specified that a hospital that has a target amount that is capped at 
    the 75th percentile would not be granted an adjustment payment to the 
    target amount (also referred to as an exception payment) as governed by 
    Sec. 413.40(g) based solely on a comparison of its costs or patient mix 
    in its base year to its costs or patient mix in the payment year. Since 
    the hospital's target amount would not be determined based on its own 
    experience in a base year, any comparison of costs or patient mix in 
    its base year to costs or patient mix in the payment year would be 
    irrelevant.
        We propose to clarify that, to the extent we grant an exception to 
    a hospital not affected by the cap, the amount of the exception would 
    be limited to the cap on the hospital's target amount. This policy is 
    consistent with the caps. By establishing caps on TEFRA target amounts, 
    Congress has limited payments to individual hospitals based on amounts 
    that reflect the cost experience of other hospitals. Therefore, in 
    determining the extent of any adjustment paid to a hospital as an 
    exception under our regulations at Sec. 413.40(g)(3), we believe it is 
    consistent with Congressional intent to limit the extent of the 
    adjustment to the hospital's cap on its target amount.
        We propose to revise Sec. 413.40(g)(1) to set forth the limitation 
    on the adjustment payments.
    
    VIII. MedPAC Recommendations
    
        We have reviewed the March 1998 report submitted by MedPAC to 
    Congress and have given its recommendations careful consideration in 
    conjunction with the proposals set forth in this document. 
    Recommendations concerning the update factors for inpatient operating 
    costs and for hospitals and hospital distinct-part units excluded from 
    the prospective payment system are discussed in Appendix D, to this 
    proposed rule. The remaining recommendations are discussed below.
    
    A. Disproportionate Share Hospitals (DSH)
    
        Recommendation: The Medicare Payment Advisory Commission (MedPAC) 
    made several recommendations concerning the Medicare disproportionate 
    share adjustment calculation. In general, the Commission's proposal 
    would base the amount of DSH payment each hospital receives on its 
    volume and mix of cases paid under the prospective payment system and 
    its share of low-income patients. The low-income share measure would 
    reflect the costs of care provided to low-income individuals (Medicare 
    patients eligible for Supplemental Security Income (SSI), Medicaid 
    patients, patients sponsored by local indigent care programs, and 
    patients receiving uncompensated care) as a proportion of total patient 
    care expenses. Both inpatient and outpatient costs were included in the 
    data used to calculate the low-income shares, although payment would be 
    made only on inpatient discharges.
        The same formula would be applied to all prospective payment 
    hospitals. Under the recommendation, there would be a threshold or 
    minimum low-income share, that must be reached for a hospital to 
    receive any Medicare disproportionate share adjustment. The payment the 
    hospital would receive is proportionate to the segment of its low-
    income share that lies above the threshold. MedPAC simulated the 
    potential effects of applying their approach on the distribution of 
    Medicare disproportionate share payments made in 1995. For purposes of 
    MedPAC's simulations, the threshold was set at a level that would limit 
    payments to about 40 percent of prospective payment hospitals--roughly 
    the same as under the current DSH adjustment. MedPAC stated that this 
    proportion could be adjusted, or the threshold could be set using a 
    different method, as deemed appropriate by policy makers. (For more 
    information see Volume 1, chapter 6, page 63 of the March 1998 report.)
        Response: Section 1886(d)(5)(F) of the Act, as amended by section 
    4403(b) of the BBA, requires us to prepare a report to Congress, due by 
    August 5, 1998, which will include our recommendations for an 
    appropriate
    
    [[Page 25603]]
    
    formula for determining DSH payments. We appreciate MedPAC's efforts to 
    assist HCFA in restructuring the Medicare disproportionate share 
    adjustment and we will further examine and consider their 
    recommendations as we develop our report to Congress.
    
    B. Potential Effects of Target Amount Caps
    
        Recommendation: The wage-related portion of the excluded hospital 
    target amount caps should be adjusted by the appropriate hospital wage 
    index to account for geographic differences in wages. (For more 
    information see Volume 1, chapter 7, page 71 of the March 1998 report.)
        Response: As MedPAC indicated in its recommendation, legislation 
    would be required to adjust the target amount caps in such a 
    substantial manner as to adjust for differences in area labor costs.
    
    IX. Other Required Information
    
    A. Requests for Data From the Public
    
        In order to respond promptly to public requests for data related to 
    the prospective payment system, we have set up a process under which 
    commenters can gain access to the raw data on an expedited basis. 
    Generally, the data are available in computer tape or cartridge format; 
    however, some files are available on diskette as well as on the 
    Internet at HTTP://WWW.HCFA.GOV/STATS/PUBFILES.HTML. Data files are 
    listed below with the cost of each. Anyone wishing to purchase data 
    tapes, cartridges, or diskettes should submit a written request along 
    with a company check or money order (payable to HCFA-PUF) to cover the 
    cost to the following address: Health Care Financing Administration, 
    Public Use Files, Accounting Division, P.O. Box 7520, Baltimore, 
    Maryland 21207-0520, (410) 786-3691. Files on the Internet may be 
    downloaded without charge.
    1. Expanded Modified MEDPAR-Hospital (National)
        The Medicare Provider Analysis and Review (MedPAR) file contains 
    records for 100 percent of Medicare beneficiaries using hospital 
    inpatient services in the United States. (The file is a Federal fiscal 
    year file, that is, discharges occurring October 1 through September 30 
    of the requested year.)
        The records are stripped of most data elements that will permit 
    identification of beneficiaries. The hospital is identified by the 6-
    position Medicare billing number. The file is available to persons 
    qualifying under the terms of the Notice of Proposed New Routine Uses 
    for an Existing System of Records published in the Federal Register on 
    December 24, 1984 (49 FR 49941), and amended by the July 2, 1985 notice 
    (50 FR 27361). The national file consists of approximately 11 million 
    records. Under the requirements of these notices, an agreement for use 
    of HCFA Beneficiary Encrypted Files must be signed by the purchaser 
    before release of these data. For all files requiring a signed 
    agreement, please write or call to obtain a blank agreement form before 
    placing an order. Two versions of this file are created each year. They 
    support the following:
         Notice of Proposed Rulemaking (NPRM) published in the 
    Federal Register, usually available by the end of May (April beginning 
    in 1998). This file is derived from the MedPAR file with a cutoff of 3 
    months after the end of the fiscal year (December file).
         Final Rule published in the Federal Register, usually 
    available by the first week of September (August beginning with the FY 
    1999 final rule). For final rules published before 1998, this file is 
    derived from the MedPAR file with a cutoff of 9 months after the end of 
    the fiscal year (June file). The FY 1997 MedPar file used for the FY 
    1999 final rule will have a cutoff of 6 months after the end of the 
    fiscal year (March file).
    
    Media: Tape/Cartridge
    File Cost: $3,415.00 per fiscal year
    Periods Available: FY 1988 through FY 1997
    2. Expanded Modified MedPAR-Hospital (State)
        The State MedPAR file contains records for 100 percent of Medicare 
    beneficiaries using hospital inpatient services in a particular State. 
    The records are stripped of most data elements that will permit 
    identification of beneficiaries. The hospital is identified by the 6-
    position Medicare billing number. The file is available to persons 
    qualifying under the terms of the Notice of Proposed New Routine Uses 
    for an Existing System of Records published in the December 24, 1984 
    Federal Register notice, and amended by the July 2, 1985 notice. This 
    file is a subset of the Expanded Modified MedPAR-Hospital (National) as 
    described above. Under the requirements of these notices, an agreement 
    for use of HCFA Beneficiary Encrypted Files must be signed by the 
    purchaser before release of these data. Two versions of this file are 
    created each year. They support the following:
         NPRM published in the Federal Register, usually available 
    by the end of May (April beginning in 1998). This file is derived from 
    the MedPAR file with a cutoff of 3 months after the end of the fiscal 
    year (December file).
         Final Rule published in the Federal Register, usually 
    available by the first week of September (August beginning with the FY 
    1999 final rule). For final rules published before 1998, this file is 
    derived from the MedPAR file with a cutoff of 9 months after the end of 
    the fiscal year (June file). The FY 1997 MedPar file used for the FY 
    1999 final rule will be cut off 6 months after the end of the fiscal 
    year (March file).
    
    Media: Tape/Cartridge
    File Cost: $1,050.00 per State per year
    Periods Available: FY 1988 through FY 1997
    3. HCFA Wage Data
        This file contains the hospital hours and salaries for 1995 used to 
    create the proposed FY 1999 prospective payment system wage index. The 
    file will be available by the beginning of February for the NPRM and 
    the beginning of May for the final rule.
    
    ------------------------------------------------------------------------
        Processing year           Wage data year          PPS fiscal year   
    ------------------------------------------------------------------------
    1998...................               1995                    1999      
    1997...................               1994                    1998      
    1996...................               1993                    1997      
    1995...................               1992                    1996      
    1994...................               1991                    1995      
    1993...................               1990                    1994      
    1992...................               1989                    1993      
    1991...................               1988                    1992      
    ------------------------------------------------------------------------
    
        These files support the following:
         NPRM published in the Federal Register, usually by the end 
    of April.
         Final Rule published in the Federal Register, usually by 
    the first week of August.
    
    Media: Diskette/Internet
    File Cost: $145.00 per year
    Periods Available: FY 1999 PPS Update
    4. HCFA Hospital Wages Indices (Formally: Urban and Rural Wage Index 
    Values Only)
        This file contains a history of all wage indices since October 1, 
    1983.
    
    Media: Diskette/Internet
    File Cost: $145.00 per year
    Periods Available: FY 1999 PPS Update
    5. PPS SSA/FIPS MSA State and County Crosswalk
        This file contains a crosswalk of State and county codes used by 
    the Social Security Administration (SSA) and the Federal Information 
    Processing Standards (FIPS), county name, and a historical list of 
    Metropolitan Statistical Area (MSA).
    
    Media: Diskette/Internet
    
    [[Page 25604]]
    
    File Cost: $145.00 per year
    Periods Available: FY 1999 PPS Update
    6. Reclassified Hospitals by Provider Only
        This file contains a list of hospitals that were reclassified for 
    the purpose of the proposed FY 1999 wage index. Two versions of these 
    files are created each year.
        They support the following:
         NPRM published in the Federal Register, usually by the end 
    of April.
         Final Rule published in the Federal Register, usually by 
    the first week of August.
    
    Media: Diskette/Internet
    File Cost: $145.00 per year
    Periods Available: FY 1999 PPS Update
    7. PPS-IV to PPS-XII Minimum Data Sets
        The Minimum Data Set contains cost, statistical, financial, and 
    other information from Medicare hospital cost reports. The data set 
    includes only the most current cost report (as submitted, final 
    settled, or reopened) submitted for a Medicare participating hospital 
    by the Medicare Fiscal Intermediary to HCFA. This data set is updated 
    at the end of each calendar quarter and is available on the last day of 
    the following month.
    
                              Media: Tape/Cartridge                         
    ------------------------------------------------------------------------
                                                      Periods               
                                                     beginning    and before
                                                    on or after             
    ------------------------------------------------------------------------
    PPS IV........................................     10/01/86     10/01/87
    PPS V.........................................     10/01/87     10/01/88
    PPS VI........................................     10/01/88     10/01/89
    PPS VII.......................................     10/01/89     10/01/90
    PPS VIII......................................     10/01/90     10/01/91
    PPS IX........................................     10/01/91     10/01/92
    PPS X.........................................     10/01/92     10/01/93
    PPS XI........................................     10/01/93     10/01/94
    PPS XII.......................................     10/01/94     10/01/95
    ------------------------------------------------------------------------
    
    (Note: The PPS XIII Minimum Data Set covering FY 1997 will not be 
    available until July 31, 1998.)
    
    File Cost: $715.00 per year
    8. PPS-IX to PPS-XII Capital Data Set
        The Capital Data Set contains selected data for capital-related 
    costs, interest expense and related information and complete balance 
    sheet data from the Medicare hospital cost report. The data set 
    includes only the most current cost report (as submitted, final settled 
    or reopened) submitted for a Medicare certified hospital by the 
    Medicare fiscal intermediary to HCFA. This data set is updated at the 
    end of each calendar quarter and is available on the last day of the 
    following month.
    
                              Media: Tape/Cartridge                         
    ------------------------------------------------------------------------
                                                      Periods               
                                                     beginning    and before
                                                    on or after             
    ------------------------------------------------------------------------
    PPS IX........................................     10/01/91     10/01/92
    PPS X.........................................     10/01/92     10/01/93
    PPS XI........................................     10/01/93     10/01/94
    PPS XII.......................................     10/01/94     10/01/95
    ------------------------------------------------------------------------
    
    (Note: The PPS XIII Capital Data Set covering FY 1997 will not be 
    available until July 31, 1998.)
    
    File Cost: $715.00 per year
    9. Provider-Specific File
        This file is a component of the PRICER program used in the fiscal 
    intermediary's system to compute DRG payments for individual bills. The 
    file contains records for all prospective payment system eligible 
    hospitals, including hospitals in waiver States, and data elements used 
    in the prospective payment system recalibration processes and related 
    activities. Beginning with December 1988, the individual records were 
    enlarged to include pass-through per diems and other elements.
    
    Media: Diskette/Internet
    File Cost: $265.00
    Periods Available: FY 1998 PPS Update
    10. HCFA Medicare Case-Mix Index File
        This file contains the Medicare case-mix index by provider number 
    as published in each year's update of the Medicare hospital inpatient 
    prospective payment system. The case-mix index is a measure of the 
    costliness of cases treated by a hospital relative to the cost of the 
    national average of all Medicare hospital cases, using DRG weights as a 
    measure of relative costliness of cases. Two versions of this file are 
    created each year. They support the following:
         NPRM published in the Federal Register, usually by the end 
    of May (April beginning in 1998).
         Final rule published in the Federal Register, usually by 
    the first week of September (August beginning in 1998).
    
    Media: Diskette/Internet
    Price: $145.00 per year
    Periods Available: FY 1985 through FY 1997 (Internet--FY 1997)
    11. DRG Relative Weights (Formerly Table 5 DRG)
        This file contains a listing of DRGs, DRG narrative description, 
    relative weights, and geometric and arithmetic mean lengths of stay as 
    published in the Federal Register. The hardcopy image has been copied 
    to diskette. There are two versions of this file as published in the 
    Federal Register:
        a. NPRM, usually published by the end of May (April beginning in 
    1998).
        b. Final rule, usually published by the first week of September 
    (August beginning in 1999).
    
    Media: Diskette/Internet
    File Cost: $145.00
    Periods Available: FY 1999 PPS Update
    12. PPS Payment Impact File
        This file contains data used to estimate payments under Medicare's 
    hospital inpatient prospective payment systems for operating and 
    capital-related costs. The data are taken from various sources, 
    including the Provider-Specific File, Minimum Data Sets, and prior 
    impact files. The data set is abstracted from an internal file used for 
    the impact analysis of the changes to the prospective payment systems 
    published in the Federal Register. This file is available for release 1 
    month after the proposed and final rules are published in the Federal 
    Register.
    
    Media: Diskette/Internet
    File Cost: $145.00
    Periods Available: FY 1999 PPS Update
    13. AOR/BOR Tables
        This file contains data used to develop the DRG relative weights. 
    It contains mean, maximum, minimum, standard deviation, and coefficient 
    of variation statistics by DRG for length of stay and standardized 
    charges. The BOR tables are ``Before Outliers Removed'' and the AOR is 
    ``After Outliers Removed.'' (Outliers refers to statistical outliers, 
    not payment outliers.) Two versions of this file are created each year. 
    They support the following:
         NPRM published in the Federal Register, usually by the end 
    of April.
         Final rule published in the Federal Register, usually by 
    the first week of August.
    
    Media: Diskette/Internet
    File Cost: $145.00
    Periods Available: FY 1999 PPS Update
    
        For further information concerning these data tapes, contact Mary 
    R. White at (410) 786-3691.
        Commenters interested in obtaining or discussing any other data 
    used in constructing this rule should contact Stephen Phillips at (410) 
    786-4548.
    
    B. Public Comments
    
        Because of the large number of items of correspondence we normally 
    receive on a proposed rule, we are not able to acknowledge or respond 
    to them individually. However, in preparing the final rule, we will 
    consider all comments concerning the provisions of this proposed rule 
    that we receive by the date and time specified in the Dates
    
    [[Page 25605]]
    
    section of this preamble and respond to those comments in the preamble 
    to that rule. We emphasize that, given the statutory requirement under 
    section 1886(e)(5) of the Act that our final rule for FY 1999 be 
    published by August 1, 1998, we will consider only those comments that 
    deal specifically with the matters discussed in this proposed rule.
    
    List of Subjects
    
    42 CFR Part 405
    
        Administrative practice and procedure, Health facilities, Health 
    professions, Kidney diseases, Medicare, Reporting and recordkeeping 
    requirements, Rural areas, X-rays.
    
    42 CFR Part 412
    
        Administrative practice and procedure, Health facilities, Medicare, 
    Puerto Rico, Reporting and recordkeeping requirements.
    
    42 CFR Part 413
    
        Health facilities, Kidney diseases, Medicare, Puerto Rico, 
    Reporting and recordkeeping requirements.
    
        42 CFR Chapter IV would be amended as set forth below:
        A. Part 405 is amended as follows:
    
    PART 405--FEDERAL HEALTH INSURANCE FOR THE AGED AND DISABLED
    
        1. The authority citation for part 405 is revised to read as 
    follows:
    
        Authority: Secs. 1102, 1861, 1862(a), 1871, 1874, 1881, and 
    1886(k) of the Social Security Act (42 U.S.C. 1302, 1395x, 1395y(a), 
    1395hh, 1395kk, 1395rr and 1395ww(k)), and sec. 353 of the Public 
    Health Service Act (42 U.S.C. 263a), unless otherwise noted.
    
    Subpart X--Rural Health Clinic and Federally Qualified Health 
    Center Services
    
    
    Sec. 405.2468  [Amended]
    
        2. In Sec. 405.2468, a new paragraph (f) is added to read as 
    follows:
    * * * * *
        (f) Graduate medical education. (1) Effective for that portion of 
    cost reporting periods occurring on or after January 1, 1999, if an RHC 
    or an FQHC incurs ``all or substantially all'' of the costs for the 
    training program in the nonhospital setting as defined in 
    Sec. 413.86(b) of this chapter, the RHC or FQHC may receive direct 
    graduate medical education payment for those residents.
        (2) Direct graduate medical education costs are not included as 
    allowable cost under Sec. 405.2466(b)(1)(i); and therefore, are not 
    subject to the limit on the all-inclusive rate for allowable costs.
        (3) Allowable graduate medical education costs must be reported on 
    the RHC's or the FQHC's cost report under a separate cost center.
        (4) Allowable direct graduate medical education costs under 
    paragraphs (f)(5) and (6)(i) of this section, are subject to reasonable 
    cost principles under part 413 and the reasonable compensation 
    equivalency limits in Secs. 415.60 and 415.70 of this chapter.
        (5) The allowable direct graduate medical education costs are those 
    costs incurred by the nonhospital site for the educational activities 
    associated with patient care services of an approved program, subject 
    to the redistribution and community support principles in 
    Sec. 413.85(c).
        (i) The following costs are included in allowable direct graduate 
    medical education costs to the extent that they are reasonable--
        (A) The costs of the residents' salaries and fringe benefits 
    (including travel and lodging expenses where applicable).
        (B) The portion of teaching physicians' salaries and fringe 
    benefits that are related to the time spent teaching and supervising 
    residents.
        (C) Facility overhead costs that are allocated to direct graduate 
    medical education.
        (ii) The following costs are not included as allowable graduate 
    medical education costs--
        (A) Costs associated with training, but not related to patient care 
    services.
        (B) Normal operating and capital-related costs.
        (C) The marginal increase in patient care costs that the RHC or 
    FQHC experiences as a result of having an approved program.
        (D) The costs associated with activities described in 
    Sec. 413.85(d) of this chapter.
        (6) Payment is equal to the product of--
        (i) The RHC's or the FQHC's allowable direct graduate medical 
    education costs; and
        (ii) Medicare's share of the direct graduate medical education 
    payment which is equal to the ratio of Medicare visits to the total 
    number of visits (as defined in Sec. 405.2463).
        (7) Direct graduate medical education payments to RHCs and FQHCs 
    made under this section are made from the Federal Supplementary Medical 
    Insurance Trust Fund.
    * * * * *
        B. Part 412 is amended as set forth below:
    
    PART 412--PROSPECTIVE PAYMENT SYSTEMS FOR INPATIENT HOSPITAL 
    SERVICES
    
        1. The authority citation for part 412 continues to read as 
    follows:
    
        Authority: Secs. 1102 and 1871 of the Social Security Act (42 
    U.S.C. 1302 and 1895hh).
    
    Subpart A--General Provisions
    
        2. Section 412.4 is revised to read as follows:
    
    
    Sec. 412.4  Discharges and transfers.
    
        (a) Discharges. Subject to the provisions of paragraphs (b) and (c) 
    of this section, a hospital inpatient is considered discharged from a 
    hospital paid under the prospective payment system when --
        (1) The patient is formally released from the hospital; or
        (2) The patient dies in the hospital.
        (b) Transfer--Basic rule. A discharge of a hospital inpatient is 
    considered to be a transfer for purposes of payment under this part if 
    the discharge is made under any of the following circumstances:
        (1) From a hospital to the care of another hospital that is--
        (i) Paid under the prospective payment system; or
        (ii) Excluded from being paid under the prospective payment system 
    because of participation in an approved Statewide cost control program 
    as described in subpart C of part 403 of this chapter.
        (2) From one inpatient area or unit of a hospital to another 
    inpatient area or unit of the hospital that is paid under the 
    prospective payment system.
        (c) Transfers--Special 10 DRG rule. For discharges occurring on or 
    after October 1, 1998, a discharge of a hospital inpatient is 
    considered to be a transfer for purposes of this part when the 
    patient's discharge is assigned, as described in Sec. 412.60(c), to one 
    of the qualifying diagnosis-related groups (DRGs) listed in paragraph 
    (d) of this section and the discharge is made under any of the 
    following circumstances--
        (1) To a hospital or distinct part hospital unit excluded from the 
    prospective payment system under subpart B of this part.
        (2) To a skilled nursing facility or to a swing bed in the hospital 
    that meets the provisions of Sec. 482.66 of this chapter.
        (3) To home under a written plan of care for the provision of home 
    health services from a home health agency and those services begin 
    within 3 days after the date of discharge.
    
    [[Page 25606]]
    
        (d) Qualifying DRGs. The qualifying DRGs for purposes of paragraph 
    (c) of this section are DRGs 14, 113, 209, 210, 211, 236, 263, 264, 
    429, and 483.
        (e) Payment for discharges. The hospital discharging an inpatient 
    (under paragraph (a) of this section) is paid in full, in accordance 
    with Sec. 412.2(b).
        (f) Payment for transfers--(1) General rule. Except as provided in 
    paragraph (f)(2) or (f)(3) of this section, a hospital that transfers 
    an inpatient under the circumstances described in paragraph (b) or (c) 
    of this section, is paid a graduated per diem rate for each day of the 
    patient's stay in that hospital, not to exceed the amount that would 
    have been paid under subparts D and M of this part if the patient had 
    been discharged to another setting. The per diem rate is determined by 
    dividing the appropriate prospective payment rates (as determined under 
    subparts D, and M of this part) by the geometric mean length of stay 
    for the specific which the case is assigned. Payment is graduated by 
    paying twice the per diem amount for the first day of the stay, and the 
    per diem amount for each subsequent day, up to the full DRG payment.
        (2) Special rule for DRGs 209, 210, and 211. A hospital that 
    transfers an inpatient under the circumstances described in paragraph 
    (c) of this section and the transfer is assigned to DRGs 209, 210 or 
    211 is paid as follows:
        (i) 50 percent of the appropriate prospective payment rate (as 
    determined under subparts D and M of this part) for the first day of 
    the stay; and
        (ii) 50 percent of the per diem amount as calculated under 
    paragraph (f)(1) of this section for the remaining days of the stay, up 
    to the full DRG payment.
        (3) Transfer assigned to DRG 385. If a transfer is classified into 
    DRG No. 385 (Neonates, died or transferred) the transferring hospital 
    is paid in accordance with Sec. 412.2(e).
        (4) Outliers. Effective with discharges occurring on or after 
    October 1, 1994, a transferring hospital may qualify for an additional 
    payment for extraordinarily high-cost cases that meet the criteria for 
    cost outliers as described in subpart F of this part.
    
    Subpart G--Special Treatment of Certain Facilities Under the 
    Prospective Payment System for Inpatient Operating Costs
    
        3. In Sec. 412.106, paragraph (b)(4) is revised to read as follows:
    
    
    Sec. 412.106  Special treatment: Hospitals that serve a 
    disproportionate share of low-income patients.
    
    * * * * *
        (b) * * *
        (4) Second computation. The fiscal intermediary determines, for the 
    same cost reporting period used for the first computation, the number 
    of the hospital's patient days of service for which patients were 
    eligible for Medicaid but not entitled to Medicare Part A, and divides 
    that number by the total number of patient days in the same period.
        (i) For purpose of paragraph (b)(4), a patient is deemed eligible 
    for Medicaid on a given day if the patient is eligible for medical 
    assistance under an approved State Medicaid plan on such day, 
    regardless of whether particular items or services were covered or paid 
    under the State plan.
        (ii) The hospital has the burden of furnishing data adequate to 
    prove eligibility for each Medicaid patient day claimed under this 
    paragraph, and of verifying with the State that a patient was eligible 
    for Medicaid during each claimed patient hospital day.
    * * * * *
    
    Subpart M--Prospective Payment System for inpatient Hospital 
    Capital Costs
    
        4. In Sec. 412.322, a new sentence is added at the end of paragraph 
    (a)(3) to read as follows:
    
    
    Sec. 412.322  Indirect medical education adjustment factor.
    
        (a) * * *
        (3) * * * This ratio cannot exceed 1.5.
    * * * * *
        5. In Sec. 412.331, paragraphs (a) and (b) are redesignated as 
    paragraphs (b) and (c) respectively, a new paragraph (a) is added, and 
    the first sentences of new paragraphs (b) introductory text and (b)(2) 
    are revised to read as follows:
    
    
    Sec. 412.331  Determining hospital-specific rates in cases of hospital 
    merger, consolidation, or dissolution.
    
        (a) New hospital merger or consolidation. If, after a new hospital 
    accepts its first patient but before the end of its base year, it 
    merges with one or more existing hospitals, and two or more separately 
    located hospital campuses are maintained, hospital specific rate and 
    payment determination for the merged entity are determined as follows--
        (1) The ``new'' campus continues to be paid based on reasonable 
    costs until the end of its base year. The existing campus remains on 
    its previous payment methodology until the end of the new campus' base 
    year. Effective with the first cost reporting period beginning after 
    the ``new'' campus, the intermediary determines a hospital-specific 
    rate applicable to the new campus, and then determines a revised 
    hospital-specific rate for the merged entity in accordance with 
    paragraph(a) of this section.
        (2) Payment determination. To determine the applicable payment 
    methodology under Sec. 412.336 and for payment purposes under 
    Sec. 412.340 or Sec. 412.344, the discharge-weighted hospital-specific 
    rate is compared to the Federal rate. The revised payment methodology 
    is effective on the first day of the cost reporting period beginning 
    after the end of the ``new'' campus'' base year.
        (b) Hospital merger or consolidation. If, after the base year, two 
    or more hospitals merge or consolidate into one hospital as provided 
    for under Sec. 413.134(k) of this chapter and are not subject to the 
    provisions of paragraph (a) of this section, the intermediary 
    determines a revised hospital-specific rate applicable to the combined 
    facility under Sec. 412.328, which is effective beginning with the date 
    of merger or consolidation. * * *
        (2) Payment determination. To determine the applicable payment 
    methodology under Sec. 412.336 and for payment purposes under 
    Sec. 412.340 or Sec. 412.344, the discharge-weighted hospital-specific 
    rate is compared to the Federal rate. * * *
    * * * * *
        C. Part 413 is amended as set forth below:
    
    PART 413--PRINCIPLES OF REASONABLE COST REIMBURSEMENT; PAYMENT FOR 
    END-STAGE RENAL DISEASE SERVICES; OPTIONAL PROSPECTIVELY DETERMINED 
    PAYMENT FOR SKILLED NURSING FACILITIES
    
        1. The authority citation for part 413 is revised to read as 
    follows:
    
        Authority: Secs. 1102, 1812(d), 1814(b), 1815, 1833(a), (I) and 
    (n), 1861(v), 1871, 1881, 1883, and 1866 of the Social Security Act 
    (42 U.S.C. 1302, 1395f(b), 1395g, 1395l, 1395l(a), (I) and (n), 
    1395x(v), 1395hh, 1395rr, 1395tt, and 1395ww).
    
    Subpart C--Limits on Cost Reimbursement
    
        2. In Sec. 413.40, paragraph (c)(4)(iv) is redesignated as 
    paragraph (v), a new paragraph (iv) is added, and paragraph (g)(1) is 
    revised to read as follows:
    
    
    Sec. 413.40  Ceiling on the rate of increase in hospital inpatient 
    costs.
    
    * * * * *
        (c) * * *
    
    [[Page 25607]]
    
        (4) * * *
        (iv) For purposes of the limits on target amounts established under 
    paragraph (c)(4)(iii) of this section, each hospital or unit that was 
    excluded from the prospective payment system for its cost reporting 
    period ending during FY 1996 will be classified in the same way (that 
    is, as a psychiatric hospital or unit, or a long-term care hospital) as 
    it was classified under subpart B of part 412 of this chapter for 
    purposes of exclusion from prospective payment systems for its cost 
    reporting period ending during FY 1996. If a hospital or unit was not 
    excluded from the prospective payment system for a cost reporting 
    period ending during FY 1996 but could qualify to be classified in more 
    than one way under the exclusion criteria in subpart B of part 412 of 
    this chapter, the hospital is assigned to the classification group that 
    has the lowest limit on its target amounts.
    * * * * *
        (g) Adjustments--(1) General rule. HCFA may adjust the amount of 
    the operating costs considered in establishing the rate-of-increase 
    ceiling for one or more cost reporting periods, including both periods 
    subject to the ceiling and the hospital's base period, under the 
    circumstances specified below. When an adjustment is requested by the 
    hospital, HCFA makes an adjustment only to the extent that the 
    hospital's operating costs are reasonable, attributable to the 
    circumstances specified separately identified by the hospital, and 
    verified by the intermediary. HCFA may grant an adjustment requested by 
    the hospital only if the hospital's operating costs exceed the rate-of-
    increase ceiling imposed under this section. In the case of a 
    psychiatric hospital or unit, rehabilitation hospital or unit, or long 
    term care hospital, the amount of payment made to a hospital after an 
    adjustment under paragraph (g)(3) of this section may not exceed the 
    75th percentile of the target amounts for hospitals of the same class 
    as described in Sec. 413.40(c)(4)(iii).
    
    Subpart F--Specific Categories of Costs
    
        3. In Sec. 413.80, paragraph (h) is redesignated as paragraph (i), 
    and a new paragraph (h) is added to read as follows:
    
    
    Sec. 413.80  Bad debts, charity, and courtesy allowances.
    
    * * * * *
        (h) Limitations on bad debts. In determining reasonable costs for 
    hospitals, the amount of bad debts otherwise treated as allowable costs 
    (as defined in paragraph (e) of this section) is reduced--
        (1) For cost reporting periods beginning during fiscal year 1998, 
    by 25 percent;
        (2) For cost reporting periods beginning during fiscal year 1999, 
    by 40 percent; and
        (3) For cost reporting periods beginning during a subsequent fiscal 
    year, by 45 percent.
    * * * * *
        4. In Sec. 413.85, a new paragraph (h) is added to read as follows:
    
    
    Sec. 413.85  Cost of educational activities.
    
    * * * * *
        (h) Medicare+Choice organizations. (1) Effective for that portion 
    of cost reporting periods occurring on or after January 1, 1999, 
    Medicare+Choice organizations may receive direct graduate medical 
    education payments for the time that residents spend in nonhospital 
    provider settings such as freestanding clinics, nursing homes, and 
    physicians' offices in connection with approved programs.
        (2) Medicare+Choice organizations may receive direct graduate 
    medical education payments if all of the following conditions are met--
        (i) The resident spends his or her time in patient care activities.
        (ii) The Medicare+Choice organization incurs ``all or substantially 
    all'' of the costs for the training program in the nonhospital setting 
    as defined in Sec. 413.86(b).
        (iii) There is a written agreement between the Medicare+Choice 
    organization and the nonhospital provider that contains--
        (A) A statement by the nonhospital provider that, all or 
    substantially all of the direct graduate medical education costs as 
    defined in paragraph (f)(1)(ii) of this section are being assumed by 
    the Medicare+Choice organization;
        (B) A statement that the nonhospital site agrees to offset the 
    revenue received from the Medicare+Choice organization.
        (C) A statement that the nonhospital site agrees to report its 
    direct graduate medical education costs in a nonreimbursable cost 
    center on its cost report; and
        (D) A statement indicating how much time the teaching physicians 
    will spend training residents in the nonhospital setting, subject to 
    the provisions of Secs. 415.60 and 415.70 of this chapter.
        (3) A Medicare+Choice organization's allowable direct graduate 
    medical education costs, subject to the redistribution and community 
    support principles in Sec. 413.85(c), consist of--
        (i) Residents' salaries and fringe benefits (including travel and 
    lodging where applicable); and
        (ii) The portion of teaching physicians' salaries and fringe 
    benefits that are related to the time spent in teaching and supervising 
    residents.
        (4) Allowable direct graduate medical education costs under 
    paragraph (h)(3) of this section are subject to the reasonable cost 
    principles of part 413 and the reasonable compensation equivalency 
    limits in Secs. 415.60 and 415.70 of this chapter.
        (5) The direct graduate medical education payment is equal to the 
    product of--
        (i) The Medicare+Choice organization's allowable direct graduate 
    medical education costs as defined in paragraph (h)(3) of this section; 
    and
        (ii) Medicare's share of the Medicare+Choice organization's direct 
    graduate medical education payment in the nonhospital site which is 
    equal to the ratio of the number of Medicare beneficiaries enrolled to 
    the total number of individuals enrolled in the Medicare+Choice 
    organization.
        (6) Direct graduate medical education payments made to 
    Medicare+Choice organizations under this section are made from the 
    Federal Supplementary Medical Insurance Trust Fund.
    * * * * *
        5. In Sec. 413.86, the introductory text of paragraph (b) is 
    republished, a new definition in alphabetical order is added to 
    paragraph (b), paragraphs (i) and (j) are redesignated as paragraphs 
    (j) and (k) respectively, paragraph (f)(2) is redesignated as new 
    paragraph (i), paragraphs (f)(2)(i) through (vii) are redesignated as 
    paragraphs (i)(1) through (7) respectively, the introductory text of 
    paragraph (f)(1) is redesignated as the introductory text of paragraph 
    (f), paragraphs (f)(1)(i) through (iii) are redesignated as paragraphs 
    (f)(1) through (3) respectively, paragraphs (f)(1)(iii)(A) and (B) are 
    redesignated as (f)(3)(i) and (ii) respectively, new paragraph (f)(2) 
    and the introductory text of new paragraph (f)(3) are revised, and a 
    new paragraph (f)(4) is added to read as follows:
    
    
    Sec. 413.86  Direct graduate medical education payments.
    
    * * * * *
        (b) Definitions. For purposes of this section, the following 
    definitions apply:
    * * * * *
        All or substantially all of the costs for the training program in 
    the nonhospital setting means the residents' salaries and fringe 
    benefits (including travel and lodging where applicable) and the
    
    [[Page 25608]]
    
    portion of the cost of teaching physicians' salaries and fringe 
    benefits.
    * * * * *
        (f) * * *
        (2) No individual may be counted as more than one FTE. If a 
    resident spends time in more than one hospital or, except as provided 
    in paragraphs (f)(3) and (4) of this section, in a nonprovider setting, 
    the resident counts as partial FTE based on the proportion of time 
    worked at the hospital to the total time worked. A part-time resident 
    counts as a partial FTE based on the proportion of allowable time 
    worked compared to the total time necessary to fill a full-time 
    internship or residency slot.
        (3) On or after July 1, 1987 and for the portion of the cost 
    reporting period ocurring before January 1, 1999, the time residents 
    spend in nonprovider settings such as freestanding clinics, nursing 
    homes, and physicians' offices in connection with approved programs is 
    not excluded in determining the number of FTE residents in the 
    calculation of a hospital's resident count if the following conditions 
    are met--
    * * * * *
        (4) On or after July 1, 1987 and for the portion cost reporting 
    period occurring on or after January 1, 1999, the time residents spend 
    in nonprovider settings such as freestanding clinics, nursing homes, 
    and physicians' offices in connection with approved programs is not 
    excluded in determining the number of FTE residents in the calculation 
    of a hospital's resident count if the following conditions are met--
        (i) The resident spends his or her time in patient care activities.
        (ii) The written agreement between the hospital and the nonhospital 
    provider must contain--
        (A) A statement by the nonhospital provider that, all or 
    substantially all of the direct graduate medical education costs as 
    defined in paragraph (b) of this section are being assumed by the 
    hospital;
        (B) A statement that the nonhospital site agrees to offset the 
    revenue received from the hospital;
        (C) A statement that the nonhospital site agrees to report its 
    direct graduate medical education costs on its cost report in a 
    graduate medical education cost center; and
        (D) A statement indicating how much time the teaching physicians 
    will spend training residents in the nonhospital setting, subject to 
    the provisions of Secs. 415.60 and 415.70 of this chapter.
    * * * * *
    (Catalog of Federal Domestic Assistance Program No. 93.773, 
    Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
    Supplementary Medical Insurance)
    
        Dated: April 28, 1998.
    Nancy-Ann Min DeParle,
    Administrator, Health Care Financing Administration.
    
        Dated: May 1, 1998.
    Donna E. Shalala,
    Secretary.
    
    [Editorial Note: The following addendum and appendixes will not 
    appear in the Code of Federal Regulations.]
    
    Addendum--Proposed Schedule of Standardized Amounts Effective With 
    Discharges Occurring On or After October 1, 1998 and Update Factors and 
    Rate-of-Increase Percentages Effective With Cost Reporting Periods 
    Beginning On or After October 1, 1998
    
    I. Summary and Background
    
        In this addendum, we are setting forth the proposed amounts and 
    factors for determining prospective payment rates for Medicare 
    inpatient operating costs and Medicare inpatient capital-related costs. 
    We are also setting forth proposed rate-of-increase percentages for 
    updating the target amounts for hospitals and hospital units excluded 
    from the prospective payment system.
        For discharges occurring on or after October 1, 1998, except for 
    sole community hospitals, Medicare-dependent, small rural hospitals, 
    and hospitals located in Puerto Rico, each hospital's payment per 
    discharge under the prospective payment system will be based on 100 
    percent of the Federal national rate.
        Sole community hospitals are paid based on whichever of the 
    following rates yield the greatest aggregate payment: The Federal 
    national rate, the updated hospital-specific rate based on FY 1982 cost 
    per discharge, or the updated hospital-specific rate based on FY 1987 
    cost per discharge. Medicare-dependent, small rural hospitals are paid 
    based on the Federal national rate or, if higher, the Federal national 
    rate plus 50 percent of the difference between the Federal national 
    rate and the updated hospital-specific rate based on FY 1982 or FY 1987 
    cost per discharge, whichever is higher. For hospitals in Puerto Rico, 
    the payment per discharge is based on the sum of 50 percent of a Puerto 
    Rico rate and 50 percent of a national rate.
        As discussed below in section II, we are proposing to make changes 
    in the determination of the prospective payment rates for Medicare 
    inpatient operating costs. The changes, to be applied prospectively, 
    would affect the calculation of the Federal rates. In section III of 
    this addendum, we discuss our proposed changes for determining the 
    prospective payment rates for Medicare inpatient capital-related costs. 
    Section IV of this addendum sets forth our proposed changes for 
    determining the rate-of-increase limits for hospitals excluded from the 
    prospective payment system. The tables to which we refer in the 
    preamble to the proposed rule are presented at the end of this addendum 
    in section V.
    
    II. Proposed Changes to Prospective Payment Rates for Inpatient 
    Operating Costs for FY 1999
    
        The basic methodology for determining prospective payment rates for 
    inpatient operating costs is set forth at Sec. 412.63 for hospitals 
    located outside of Puerto Rico. The basic methodology for determining 
    the prospective payment rates for inpatient operating costs for 
    hospitals located in Puerto Rico is set forth at Secs. 412.210 and 
    412.212. Below, we discuss the proposed factors used for determining 
    the prospective payment rates. The Federal and Puerto Rico rate 
    changes, once issued as final, would be effective with discharges 
    occurring on or after October 1, 1998. As required by section 
    1886(d)(4)(C) of the Act, we must also adjust the DRG classifications 
    and weighting factors for discharges in FY 1999.
        In summary, the proposed standardized amounts set forth in Tables 
    1A and 1C of section V of this addendum reflect--
         Updates of 0.7 percent for all areas (that is, the market 
    basket percentage increase of 2.6 percent minus 1.9 percentage points);
         An adjustment to ensure budget neutrality as provided for 
    in sections 1886(d)(4)(C)(iii) and (d)(3)(E) of the Act by applying new 
    budget neutrality adjustment factors to the large urban and other 
    standardized amounts;
         An adjustment to ensure budget neutrality as provided for 
    in section 1886(d)(8)(D) of the Act by removing the FY 1998 budget 
    neutrality factor and applying a revised factor;
         An adjustment to apply the revised outlier offset by 
    removing the FY 1998 outlier offsets and applying a new offset; and
         An adjustment in the Puerto Rico standardized amounts to 
    reflect the application of a Puerto Rico-specific wage index.
        The standardized amounts set forth in Tables 1E and 1F of section V 
    of this addendum, which apply to ``temporary relief'' hospitals (see 62 
    FR 46001 for a discussion of these hospitals), reflect updates of 1.0 
    percent for all areas but otherwise reflect the same adjustments
    
    [[Page 25609]]
    
    as the national standardized amounts. As described in Sec. 412.107, 
    these hospitals receive an update that is 0.3 percentage points more 
    than the update factor applicable to all other prospective payment 
    hospitals for FY 1999.
    
    A. Calculation of Adjusted Standardized Amounts
    
    1. Standardization of Base-Year Costs or Target Amounts
        Section 1886(d)(2)(A) of the Act required the establishment of 
    base-year cost data containing allowable operating costs per discharge 
    of inpatient hospital services for each hospital. The preamble to the 
    September 1, 1983 interim final rule (48 FR 39763) contains a detailed 
    explanation of how base-year cost data were established in the initial 
    development of standardized amounts for the prospective payment system 
    and how they are used in computing the Federal rates.
        Section 1886(d)(9)(B)(i) of the Act required that Medicare target 
    amounts be determined for each hospital located in Puerto Rico for its 
    cost reporting period beginning in FY 1987. The September 1, 1987 final 
    rule contains a detailed explanation of how the target amounts were 
    determined and how they are used in computing the Puerto Rico rates (52 
    FR 33043, 33066).
        The standardized amounts are based on per discharge averages of 
    adjusted hospital costs from a base period or, for Puerto Rico, 
    adjusted target amounts from a base period, updated and otherwise 
    adjusted in accordance with the provisions of section 1886(d) of the 
    Act. Sections 1886(d)(2)(B) and (C) of the Act required that the base-
    year per discharge costs be updated for FY 1984 and then standardized 
    in order to remove from the cost data the effects of certain sources of 
    variation in cost among hospitals. These include case mix, differences 
    in area wage levels, cost of living adjustments for Alaska and Hawaii, 
    indirect medical education costs, and payments to hospitals serving a 
    disproportionate share of low-income patients.
        Under sections 1886(d)(2)(H) and (d)(3)(E) of the Act, in making 
    payments under the prospective payment system, the Secretary estimates 
    from time to time the proportion of costs that are wages and wage-
    related costs. Since October 1, 1997, when the market basket was last 
    revised, we have considered 71.1 percent of costs to be labor-related 
    for purposes of the prospective payment system. We are revising the 
    Puerto Rico standardized amounts by the average labor share in Puerto 
    Rico of 71.3 percent. We are revising the discharge-weighted national 
    standardized amount for Puerto Rico to reflect the proportion of 
    discharges in large urban and other areas from the FY 1997 MedPAR file.
    2. Computing Large Urban and Other Area Averages
        Sections 1886(d) (2)(D) and (3) of the Act require the Secretary to 
    compute two average standardized amounts for discharges occurring in a 
    fiscal year: One for hospitals located in large urban areas and one for 
    hospitals located in other areas. In addition, under sections 
    1886(d)(9)(B)(iii) and (C)(i) of the Act, the average standardized 
    amount per discharge must be determined for hospitals located in urban 
    and other areas in Puerto Rico. Hospitals in Puerto Rico are paid a 
    blend of 50 percent of the applicable Puerto Rico standardized amount 
    and 50 percent of a national standardized payment amount.
        Section 1886(d)(2)(D) of the Act defines ``urban area'' as those 
    areas within a Metropolitan Statistical Area (MSA). A ``large urban 
    area'' is defined as an urban area with a population of more than 
    1,000,000. In addition, section 4009(i) of Public Law 100-203 provides 
    that a New England County Metropolitan Area (NECMA) with a population 
    of more than 970,000 is classified as a large urban area. As required 
    by section 1886(d)(2)(D) of the Act, population size is determined by 
    the Secretary based on the latest population data published by the 
    Bureau of the Census. Urban areas that do not meet the definition of a 
    ``large urban area'' are referred to as ``other urban areas.'' Areas 
    that are not included in MSAs are considered ``rural areas'' under 
    section 1886(d)(2)(D) of the Act. Payment for discharges from hospitals 
    located in large urban areas will be based on the large urban 
    standardized amount. Payment for discharges from hospitals located in 
    other urban and rural areas will be based on the other standardized 
    amount.
        Based on 1996 population estimates published by the Bureau of the 
    Census, 60 areas meet the criteria to be defined as large urban areas 
    for FY 1999. These areas are identified by a footnote in Table 4A.
    3. Updating the Average Standardized Amounts
        Under section 1886(d)(3)(A) of the Act, we update the area average 
    standardized amounts each year. In accordance with section 
    1886(d)(3)(A)(iv) of the Act, we are proposing to update the large 
    urban and the other areas average standardized amounts for FY 1999 
    using the applicable percentage increases specified in section 
    1886(b)(3)(B)(i) of the Act. Section 1886(b)(3)(B)(i)(XIV) of the Act 
    specifies that, for hospitals in all areas, the update factor for the 
    standardized amounts for FY 1999 is equal to the market basket 
    percentage increase minus 1.9 percentage points. The ``temporary 
    relief'' provision under section 4401 of Public Law 105-33 provides for 
    an update equal to the market basket percentage increase minus 1.6 
    percentage points for hospitals that are not Medicare-dependent, small 
    rural hospitals, that receive no IME or DSH payments, that are located 
    in a state in which aggregate Medicare operating payments for such 
    hospitals were less than their aggregate allowable Medicare operating 
    costs for their cost reporting periods beginning during FY 1995, and 
    whose Medicare operating payments are less than their allowable 
    Medicare operating costs for their cost reporting period beginning 
    during FY 1999.
        The percentage change in the market basket reflects the average 
    change in the price of goods and services purchased by hospitals to 
    furnish inpatient care. The most recent forecast of the proposed 
    hospital market basket increase for FY 1999 is 2.6 percent. Thus, for 
    FY 1999, the proposed update to the average standardized amounts equals 
    0.7 percent (1.0 percent for those hospitals qualifying under the 
    ``temporary relief'' provision of Public Law 105-33).
        As in the past, we are adjusting the FY 1998 standardized amounts 
    to remove the effects of the FY 1998 geographic reclassifications and 
    outlier payments before applying the FY 1999 updates. That is, we are 
    increasing the standardized amounts to restore the reductions that were 
    made for the effects of geographic reclassification and outliers. We 
    then apply the new offsets to the standardized amounts for outliers and 
    geographic reclassifications for FY 1999.
        Although the update factor for FY 1999 is set by law, we are 
    required by section 1886(e)(3) of the Act to report to Congress on our 
    initial recommendation of update factors for FY 1999 for both 
    prospective payment hospitals and hospitals excluded from the 
    prospective payment system. For general information purposes, we have 
    included the report to Congress as Appendix C to this proposed rule. 
    Our proposed recommendation on the update factors (which is required by 
    sections 1886(e)(4)(A) and (e)(5)(A) of the Act), as well as our 
    responses to MedPAC's recommendation concerning the update factor, are 
    set forth as Appendix D to this proposed rule.
    
    [[Page 25610]]
    
    4. Other Adjustments to the Average Standardized Amounts
        a. Recalibration of DRG Weights and Updated Wage Index--Budget 
    Neutrality Adjustment. Section 1886(d)(4)(C)(iii) of the Act specifies 
    that beginning in FY 1991, the annual DRG reclassification and 
    recalibration of the relative weights must be made in a manner that 
    ensures that aggregate payments to hospitals are not affected. As 
    discussed in section II of the preamble, we normalized the recalibrated 
    DRG weights by an adjustment factor, so that the average case weight 
    after recalibration is equal to the average case weight prior to 
    recalibration.
        Section 1886(d)(3)(E) of the Act specifies that the hospital wage 
    index must be updated on an annual basis beginning October 1, 1993. 
    This provision also requires that any updates or adjustments to the 
    wage index must be made in a manner that ensures that aggregate 
    payments to hospitals are not affected by the change in the wage index.
        To comply with the requirement of section 1886(d)(4)(C)(iii) of the 
    Act that DRG reclassification and recalibration of the relative weights 
    be budget neutral, and the requirement in section 1886(d)(3)(E) of the 
    Act that the updated wage index be budget neutral, we used historical 
    discharge data to simulate payments and compared aggregate payments 
    using the FY 1998 relative weights and wage index to aggregate payments 
    using the proposed FY 1999 relative weights and wage index. The same 
    methodology was used for the FY 1998 budget neutrality adjustment. (See 
    the discussion in the September 1, 1992 final rule (57 FR 39832).) 
    Based on this comparison, we computed a budget neutrality adjustment 
    factor equal to 0.999227. We adjust the Puerto Rico-specific 
    standardized amounts for the effect of DRG reclassification and 
    recalibration. We computed a budget neutrality adjustment factor for 
    Puerto Rico-specific standardized amounts equal to 0.998946. These 
    budget neutrality adjustment factors are applied to the standardized 
    amounts without removing the effects of the FY 1998 budget neutrality 
    adjustments. We do not remove the prior budget neutrality adjustment 
    because estimated aggregate payments after the changes in the DRG 
    relative weights and wage index should equal estimated aggregate 
    payments prior to the changes. If we removed the prior year adjustment, 
    we would not satisfy this condition.
        In addition, we are proposing to continue to apply the same FY 1999 
    adjustment factor to the hospital-specific rates that are effective for 
    cost reporting periods beginning on or after October 1, 1998, in order 
    to ensure that we meet the statutory requirement that aggregate 
    payments neither increase nor decrease as a result of the 
    implementation of the FY 1999 DRG weights and updated wage index. (See 
    the discussion in the September 4, 1990 final rule (55 FR 36073).)
        b. Reclassified Hospitals--Budget Neutrality Adjustment. Section 
    1886(d)(8)(B) of the Act provides that certain rural hospitals are 
    deemed urban effective with discharges occurring on or after October 1, 
    1988. In addition, section 1886(d)(10) of the Act provides for the 
    reclassification of hospitals based on determinations by the Medicare 
    Geographic Classification Review Board (MGCRB). Under section 
    1886(d)(10) of the Act, a hospital may be reclassified for purposes of 
    the standardized amount or the wage index, or both.
        Under section 1886(d)(8)(D) of the Act, the Secretary is required 
    to adjust the standardized amounts so as to ensure that total aggregate 
    payments under the prospective payment system after implementation of 
    the provisions of sections 1886(d)(8)(B) and (C) and 1886(d)(10) of the 
    Act are equal to the aggregate prospective payments that would have 
    been made absent these provisions. To calculate this budget neutrality 
    factor, we used historical discharge data to simulate payments, and 
    compared total prospective payments (including IME and DSH payments) 
    prior to any reclassifications to total prospective payments after 
    reclassifications. We are applying an adjustment factor of 0.994019 to 
    ensure that the effects of reclassification are budget neutral.
        The adjustment factor is applied to the standardized amounts after 
    removing the effects of the FY 1998 budget neutrality adjustment 
    factor. We note that the proposed FY 1999 adjustment reflects wage 
    index and standardized amount reclassifications approved by the MGCRB 
    or the Administrator as of February 27, 1998. The effects of any 
    additional reclassification changes resulting from appeals and reviews 
    of the MGCRB decisions for FY 1999 or from a hospital's request for the 
    withdrawal of a reclassification request will be reflected in the final 
    budget neutrality adjustment required under section 1886(d)(8)(D) of 
    the Act and published in the final rule for FY 1999.
        c. Outliers. Section 1886(d)(5)(A) of the Act provides for payments 
    in addition to the basic prospective payments for ``outlier'' cases, 
    cases involving extraordinarily high costs (cost outliers). Section 
    1886(d)(3)(B) of the Act requires the Secretary to adjust both the 
    large urban and other area national standardized amounts by the same 
    factor to account for the estimated proportion of total DRG payments 
    made to outlier cases. Similarly, section 1886(d)(9)(B)(iv) of the Act 
    requires the Secretary to adjust the large urban and other standardized 
    amounts applicable to hospitals in Puerto Rico to account for the 
    estimated proportion of total DRG payments made to outlier cases. 
    Furthermore, under section 1886(d)(5)(A)(iv) of the Act, outlier 
    payments for any year must be projected to be not less than 5 percent 
    nor more than 6 percent of total payments based on DRG prospective 
    payment rates.
        For FY 1998, the fixed loss cost outlier threshold is equal to the 
    prospective payment for the DRG plus $11,050 ($10,080 for hospitals 
    that have not yet entered the prospective payment system for capital-
    related costs). The marginal cost factor for cost outliers (the percent 
    of costs paid after costs for the case exceed the threshold) is 80 
    percent. We applied an outlier adjustment to the FY 1998 standardized 
    amounts of 0.948840 for the large urban and other areas rates and 
    0.9382 for the capital Federal rate.
        We are proposing a fixed loss cost outlier threshold in FY 1999 
    equal to the prospective payment rate for the DRG plus $11,350 ($10,355 
    for hospitals that have not yet entered the prospective payment system 
    for capital-related costs). In addition, we are proposing to maintain 
    the marginal cost factor for cost outliers at 80 percent.
        In accordance with section 1886(d)(5)(A)(iv) of the Act, we 
    calculated proposed outlier thresholds so that outlier payments are 
    projected to equal 5.1 percent of total payments based on DRG 
    prospective payment rates. In accordance with section 1886(d)(3)(E), we 
    reduced the proposed FY 1999 standardized amounts by the same 
    percentage to account for the projected proportion of payments paid to 
    outliers.
        As stated in the September 1, 1993 final rule (58 FR 46348), we 
    establish outlier thresholds that are applicable to both inpatient 
    operating costs and inpatient capital-related costs. When we modeled 
    the combined operating and capital outlier payments, we found that 
    using a common set of thresholds resulted in a higher percentage of 
    outlier payments for capital-related costs than for operating costs. We 
    project that the proposed thresholds for FY 1999 will result in outlier 
    payments equal to 5.1
    
    [[Page 25611]]
    
    percent of operating DRG payments and 6.2 percent of capital payments 
    based on the Federal rate.
        The proposed outlier adjustment factors applied to the standardized 
    amounts for FY 1999 are as follows:
    
    ------------------------------------------------------------------------
                                                 Operating                  
                                               standardized       Capital   
                                                  amounts      federal rate 
    ------------------------------------------------------------------------
    National................................        0.948819          0.9378
    Puerto Rico.............................        0.972962          0.9626
    ------------------------------------------------------------------------
    
        We apply the proposed outlier adjustment factors after removing the 
    effects of the FY 1998 outlier adjustment factors on the standardized 
    amounts.
        Table 8A in section V of this addendum contains the updated 
    Statewide average operating cost-to-charge ratios for urban hospitals 
    and for rural hospitals to be used in calculating cost outlier payments 
    for those hospitals for which the intermediary is unable to compute a 
    reasonable hospital-specific cost-to-charge ratio. These Statewide 
    average ratios would replace the ratios published in the August 29, 
    1997 final rule with comment period (62 FR 46113), effective October 1, 
    1998. Table 8B contains comparable Statewide average capital cost-to-
    charge ratios. These average ratios would be used to calculate cost 
    outlier payments for those hospitals for which the intermediary 
    computes operating cost-to-charge ratios lower than 0.217279 or greater 
    than 1.28985 and capital cost-to-charge ratios lower than 0.01281 or 
    greater than 0.18084. This range represents 3.0 standard deviations 
    (plus or minus) from the mean of the log distribution of cost-to-charge 
    ratios for all hospitals. We note that the cost-to-charge ratios in 
    Tables 8A and 8B would be used during FY 1999 when hospital-specific 
    cost-to-charge ratios based on the latest settled cost report are 
    either not available or outside the three standard deviations range.
        In the August 29, 1997 final rule with comment period (62 FR 
    46041), we stated that, based on available data, we estimated that 
    actual FY 1997 outlier payments would be approximately 4.8 percent of 
    actual total DRG payments. This was computed by simulating payments 
    using actual FY 1996 bill data available at the time. That is, the 
    estimate of actual outlier payments did not reflect actual FY 1997 
    bills but instead reflected the application of FY 1997 rates and 
    policies to available FY 1996 bills. Our current estimate, using 
    available FY 1997 bills, is that actual outlier payments for FY 1997 
    were approximately 5.5 percent of actual total DRG payments. We note 
    that the MedPAR file for FY 1997 discharges continues to be updated.
        We currently estimate that actual outlier payments for FY 1998 will 
    be approximately 5.4 percent of actual total DRG payments, slightly 
    higher than the 5.1 percent we projected in setting outlier policies 
    for FY 1998. This estimate is based on simulations using the December 
    1997 update of the provider-specific file and the December 1997 update 
    of the FY 1997 MedPAR file (discharge data for FY 1997 bills). We used 
    these data to calculate an estimate of the actual outlier percentage 
    for FY 1998 by applying FY 1998 rates and policies to available FY 1997 
    bills.
        In FY 1994, we began using a cost inflation factor rather than a 
    charge inflation factor to update billed charges for purposes of 
    estimating outlier payments. This refinement was made to improve our 
    estimation methodology. For FY 1998, we used a cost inflation factor of 
    minus 2.005 percent (a cost per case decrease of 2.005 percent). For FY 
    1999, based on more recent data, we are proposing a cost inflation 
    factor of minus 1.831 percent to set outlier thresholds. We will 
    reevaluate this factor when we develop the final rule for FY 1999. At 
    that time, more recent data should be available for analysis, 
    specifically, cost report data for cost reporting periods beginning in 
    FY 1997.
    5. FY 1999 Standardized Amounts
        The adjusted standardized amounts are divided into labor and 
    nonlabor portions. Table 1A (Table 1E for ``temporary relief'' 
    hospitals) contains the two national standardized amounts that we are 
    proposing to be applicable to all hospitals, except for hospitals in 
    Puerto Rico. Under section 1886(d)(9)(A)(ii) of the Act, the Federal 
    portion of the Puerto Rico payment rate is based on the discharge-
    weighted average of the national large urban standardized amount and 
    the national other standardized amount (as set forth in Table 1A and 
    1E). The labor and nonlabor portions of the national average 
    standardized amounts for Puerto Rico hospitals are set forth in Table 
    1C (Table 1F for ``temporary relief'' hospitals). These tables also 
    include the Puerto Rico standardized amounts.
    
    B. Adjustments for Area Wage Levels and Cost of Living
    
        Tables 1A, 1C, 1E and 1F, as set forth in this addendum, contain 
    the proposed labor-related and nonlabor-related shares that would be 
    used to calculate the prospective payment rates for hospitals located 
    in the 50 States, the District of Columbia, and Puerto Rico. This 
    section addresses two types of adjustments to the standardized amounts 
    that are made in determining the prospective payment rates as described 
    in this addendum.
    1. Adjustment for Area Wage Levels
        Sections 1886(d)(3)(E) and 1886(d)(9)(C)(iv) of the Act require 
    that an adjustment be made to the labor-related portion of the 
    prospective payment rates to account for area differences in hospital 
    wage levels. This adjustment is made by multiplying the labor-related 
    portion of the adjusted standardized amounts by the appropriate wage 
    index for the area in which the hospital is located. In section III of 
    the preamble, we discuss certain revisions we are making to the wage 
    index. The wage index is set forth in Tables 4A through 4F of this 
    addendum.
    2. Adjustment for Cost of Living in Alaska and Hawaii
        Section 1886(d)(5)(H) of the Act authorizes an adjustment to take 
    into account the unique circumstances of hospitals in Alaska and 
    Hawaii. Higher labor-related costs for these two States are taken into 
    account in the adjustment for area wages described above. For FY 1999, 
    we propose to adjust the payments for hospitals in Alaska and Hawaii by 
    multiplying the nonlabor portion of the standardized amounts by the 
    appropriate adjustment factor contained in the table below. If the 
    Office of Personnel Management releases revised cost-of-living 
    adjustment factors before July 1, 1998, we will publish them in the 
    final rule and use them in determining FY 1999 payments.
    
     Table of Cost-of-Living Adjustment Factors, Alaska and Hawaii Hospitals
    ------------------------------------------------------------------------
                                                                            
    ------------------------------------------------------------------------
    Alaska--All areas................................................  1.25 
    Hawaii:                                                                 
      County of Honolulu.............................................  1.225
      County of Hawaii...............................................  1.15 
      County of Kauai................................................  1.225
      County of Maui.................................................  1.225
      County of Kalawao..............................................  1.225
    ------------------------------------------------------------------------
    
        (The above factors are based on data obtained from the U.S. Office 
    of Personnel Management.)
    
    C. DRG Relative Weights
    
        As discussed in section II of the preamble, we have developed a 
    classification system for all hospital discharges, assigning them into 
    DRGs, and have developed relative weights for each DRG that reflect the 
    resource utilization of cases in each DRG relative
    
    [[Page 25612]]
    
    to Medicare cases in other DRGs. Table 5 of section V of this addendum 
    contains the relative weights that we propose to use for discharges 
    occurring in FY 1999. These factors have been recalibrated as explained 
    in section II of the preamble.
    
    D. Calculation of Prospective Payment Rates for FY 1999
    
        General Formula for Calculation of Prospective Payment Rates for FY 
    1999
        Prospective payment rate for all hospitals located outside of 
    Puerto Rico except sole community hospitals and Medicare-dependent, 
    small rural hospitals = Federal rate.
        Prospective payment rate for sole community hospitals = Whichever 
    of the following rates yields the greatest aggregate payment: 100 
    percent of the Federal rate, 100 percent of the updated FY 1982 
    hospital-specific rate, or 100 percent of the updated FY 1987 hospital-
    specific rate.
        Prospective payment rate for Medicare-dependent, small rural 
    hospitals = 100 percent of the Federal rate plus, if the greater of the 
    updated FY 1982 hospital-specific rate or the updated FY 1987 hospital-
    specific rate is higher than the Federal rate, 50 percent of the 
    difference between the applicable hospital-specific rate and the 
    Federal rate.
        Prospective payment rate for Puerto Rico = 50 percent of the Puerto 
    Rico rate + 50 percent of a discharge-weighted average of the national 
    large urban standardized amount and the national other standardized 
    amount.
    1. Federal Rate
        For discharges occurring on or after October 1, 1998 and before 
    October 1, 1999, except for sole community hospitals, Medicare-
    dependent, small rural hospitals, and hospitals in Puerto Rico, the 
    hospital's payment is based exclusively on the Federal national rate.
        The payment amount is determined as follows:
        Step 1--Select the appropriate national standardized amount 
    considering the type of hospital and designation of the hospital as 
    large urban or other (see Tables 1A or 1E, in section V of this 
    addendum).
        Step 2--Multiply the labor-related portion of the standardized 
    amount by the applicable wage index for the geographic area in which 
    the hospital is located (see Tables 4A, 4B, and 4C of section V of this 
    addendum).
        Step 3--For hospitals in Alaska and Hawaii, multiply the nonlabor-
    related portion of the standardized amount by the appropriate cost-of-
    living adjustment factor.
        Step 4--Add the amount from Step 2 and the nonlabor-related portion 
    of the standardized amount (adjusted if appropriate under Step 3).
        Step 5--Multiply the final amount from Step 4 by the relative 
    weight corresponding to the appropriate DRG (see Table 5 of section V 
    of this addendum).
    2. Hospital-Specific Rate (Applicable Only to Sole Community Hospitals 
    and Medicare-Dependent, Small Rural Hospitals)
        Sections 1886(d)(5)(D)(i) and (b)(3)(C) of the Act provide that 
    sole community hospitals are paid based on whichever of the following 
    rates yields the greatest aggregate payment: the Federal rate, the 
    updated hospital-specific rate based on FY 1982 cost per discharge, or 
    the updated hospital-specific rate based on FY 1987 cost per discharge.
        Sections 1886(d)(5)(G) and (b)(3)(D) of the Act provide that 
    Medicare-dependent, small rural hospitals are paid based on whichever 
    of the following rates yields the greatest aggregate payment: the 
    Federal rate or the Federal rate plus 50 percent of the difference 
    between the Federal rate and the greater of the updated hospital-
    specific rate based on FY 1982 and FY 1987 cost per discharge.
        Hospital-specific rates have been determined for each of these 
    hospitals based on both the FY 1982 cost per discharge and the FY 1987 
    cost per discharge. For a more detailed discussion of the calculation 
    of the FY 1982 hospital-specific rate and the FY 1987 hospital-specific 
    rate, we refer the reader to the September 1, 1983 interim final rule 
    (48 FR 39772); the April 20, 1990 final rule with comment (55 FR 
    15150); and the September 4, 1990 final rule (55 FR 35994).
        a. Updating the FY 1982 and FY 1987 Hospital-Specific Rates for FY 
    1999. We are proposing to increase the hospital-specific rates by 0.7 
    percent (the hospital market basket percentage increase of 2.6 percent 
    minus 1.9 percentage points) for sole community hospitals and Medicare-
    dependent, small rural hospitals located in all areas for FY 1999. 
    Section 1886(b)(3)(C)(iv) of the Act provides that the update factor 
    applicable to the hospital-specific rates for sole community hospitals 
    equals the update factor provided under section 1886(b)(3)(B)(iv) of 
    the Act, which, for FY 1999, is the market basket rate of increase 
    minus 1.9 percentage points. Section 1886(b)(3)(D) of the Act provides 
    that the update factor applicable to the hospital-specific rates for 
    Medicare-dependent, small rural hospitals equals the update factor 
    provided under section 1886(b)(3)(B)(iv) of the Act, which, for FY 
    1999, is the market basket rate of increase minus 1.9 percentage 
    points.
        b. Calculation of Hospital-Specific Rate. For sole community 
    hospitals and Medicare-dependent, small rural hospitals, the applicable 
    FY 1999 hospital-specific rate would be calculated by increasing the 
    hospital's hospital-specific rate for the preceding fiscal year by the 
    applicable update factor (0.7 percent), which is the same as the update 
    for all prospective payment hospitals except ``temporary relief'' 
    hospitals. In addition, the hospital-specific rate would be adjusted by 
    the budget neutrality adjustment factor (that is, 0.999227) as 
    discussed in section II.A.4.a of this Addendum. This resulting rate 
    would be used in determining under which rate a sole community hospital 
    or Medicare-dependent, small rural hospital is paid for its discharges 
    beginning on or after October 1, 1998, based on the formula set forth 
    above.
    3. General Formula for Calculation of Prospective Payment Rates for 
    Hospitals Located in Puerto Rico Beginning On or After October 1, 1998 
    and Before October 1, 1999.
        a. Puerto Rico Rate. The Puerto Rico prospective payment rate is 
    determined as follows:
        Step 1--Select the appropriate adjusted average standardized amount 
    considering the large urban or other designation of the hospital (see 
    Table 1C or 1F of section V of the addendum).
        Step 2--Multiply the labor-related portion of the standardized 
    amount by the appropriate Puerto Rico-specific wage index (see Table 4F 
    of section V of the addendum).
        Step 3--Add the amount from Step 2 and the nonlabor-related portion 
    of the standardized amount.
        Step 4--Multiply the result in Step 3 by 50 percent.
        Step 5--Multiply the amount from Step 4 by the appropriate DRG 
    relative weight (see Table 5 of section V of the addendum).
        b. National Rate. The national prospective payment rate is 
    determined as follows:
        Step 1--Multiply the labor-related portion of the national average 
    standardized amount (see Table 1C or 1F of section V of the addendum) 
    by the appropriate national wage index (see Tables 4A and 4B of section 
    V of the addendum).
        Step 2--Add the amount from Step 1 and the nonlabor-related portion 
    of the national average standardized amount.
    
    [[Page 25613]]
    
    Step 3--Multiply the result in Step 2 by 50 percent.
    
        Step 4--Multiply the amount from Step 3 by the appropriate DRG 
    relative weight (see Table 5 of section V of the addendum).
        The sum of the Puerto Rico rate and the national rate computed 
    above equals the prospective payment for a given discharge for a 
    hospital located in Puerto Rico.
    
    III. Proposed Changes to Payment Rates for Inpatient Capital-
    Related Costs for FY 1999
    
        The prospective payment system for hospital inpatient capital-
    related costs was implemented for cost reporting periods beginning on 
    or after October 1, 1991. Effective with that cost reporting period and 
    during a 10-year transition period extending through FY 2001, hospital 
    inpatient capital-related costs are paid on the basis of an increasing 
    proportion of the capital prospective payment system Federal rate and a 
    decreasing proportion of a hospital's historical costs for capital.
        The basic methodology for determining Federal capital prospective 
    rates is set forth at Secs. 412.308 through 412.352. Below we discuss 
    the factors that we used to determine the proposed Federal rate and the 
    hospital-specific rates for FY 1999. The rates will be effective for 
    discharges occurring on or after October 1, 1998.
        For FY 1992, we computed the standard Federal payment rate for 
    capital-related costs under the prospective payment system by updating 
    the FY 1989 Medicare inpatient capital cost per case by an actuarial 
    estimate of the increase in Medicare inpatient capital costs per case. 
    Each year after FY 1992 we update the standard Federal rate, as 
    provided in Sec. 412.308(c)(1), to account for capital input price 
    increases and other factors. Also, Sec. 412.308(c)(2) provides that the 
    Federal rate is adjusted annually by a factor equal to the estimated 
    proportion of outlier payments under the Federal rate to total capital 
    payments under the Federal rate. In addition, Sec. 412.308(c)(3) 
    requires that the Federal rate be reduced by an adjustment factor equal 
    to the estimated proportion of payments for exceptions under 
    Sec. 412.348. Furthermore, Sec. 412.308(c)(4)(ii) requires that the 
    Federal rate be adjusted so that the annual DRG reclassification and 
    the recalibration of DRG weights and changes in the geographic 
    adjustment factor are budget neutral. For FYs 1992 through 1995, 
    Sec. 412.352 required that the Federal rate also be adjusted by a 
    budget neutrality factor so that aggregate payments for inpatient 
    hospital capital costs were projected to equal 90 percent of the 
    payments that would have been made for capital-related costs on a 
    reasonable cost basis during the fiscal year. That provision expired in 
    FY 1996. Section 412.308(b)(2) describes the 7.4 percent reduction to 
    the rate which was made in FY 1994, and Sec. 412.308(b)(3) describes 
    the 0.28 percent reduction to the rate made in FY 1996 as a result of 
    the revised policy of paying for transfers. In the FY 1998 final rule 
    with comment period (62 FR 45966) we implemented section 4402 of the 
    BBA, which required that for discharges occurring on or after October 
    1, 1997, and before October 1, 2002, the unadjusted standard Federal 
    rate was reduced by 17.78 percent. A small part of that reduction will 
    be restored effective October 1, 2002.
        For each hospital, the hospital-specific rate was calculated by 
    dividing the hospital's Medicare inpatient capital-related costs for a 
    specified base year by its Medicare discharges (adjusted for 
    transfers), and dividing the result by the hospital's case mix index 
    (also adjusted for transfers). The resulting case-mix adjusted average 
    cost per discharge was then updated to FY 1992 based on the national 
    average increase in Medicare's inpatient capital cost per discharge and 
    adjusted by the exceptions payment adjustment factor and the budget 
    neutrality adjustment factor to yield the FY 1992 hospital-specific 
    rate. Since FY 1992, the hospital-specific rate has been updated 
    annually for inflation and for changes in the exceptions payment 
    adjustment factor. For FYs 1992 through 1995, the hospital-specific 
    rate was also adjusted by a budget neutrality adjustment factor. In the 
    FY 1998 final rule with comment period (62 FR 46012) we implemented 
    section 4402 of the BBA, which required that for discharges occurring 
    on or after October 1, 1997, and before October 1, 2002, the unadjusted 
    hospital-specific rate should be reduced by 17.78 percent. A small part 
    of that reduction will also be restored effective October 1, 2002.
        To determine the appropriate budget neutrality adjustment factor 
    and the exceptions payment adjustment factor, we developed a dynamic 
    model of Medicare inpatient capital-related costs, that is, a model 
    that projects changes in Medicare inpatient capital-related costs over 
    time. With the expiration of the budget neutrality provision, the model 
    is still used to estimate the exceptions payment adjustment and other 
    factors. The model and its application are described in greater detail 
    in Appendix B of this proposed rule.
        In accordance with section 1886(d)(9)(A) of the Act, under the 
    prospective payment system for inpatient operating costs, hospitals 
    located in Puerto Rico are paid for operating costs under a special 
    payment formula. Prior to FY 1998, hospitals in Puerto Rico were paid a 
    blended rate that consisted of 75 percent of the applicable 
    standardized amount specific to Puerto Rico hospitals and 25 percent of 
    the applicable national average standardized amount. However, effective 
    October 1, 1998, as a result of section 4406 of the BBA, operating 
    payments to hospitals in Puerto Rico are based on a blend of 50 percent 
    of the applicable standardized amount specific to Puerto Rico hospitals 
    and 50 percent of the applicable national average standardized amount. 
    In conjunction with this change to the operating blend percentage, 
    effective with discharges on or after October 1, 1997, we compute 
    capital payments to hospitals in Puerto Rico based on a blend of 50 
    percent of the Puerto Rico rate and 50 percent of the Federal rate. 
    Section 412.374 provides for the use of this blended payment system for 
    payments to Puerto Rico hospitals under the prospective payment system 
    for inpatient capital-related costs. Accordingly, for capital-related 
    costs we compute a separate payment rate specific to Puerto Rico 
    hospitals using the same methodology used to compute the national 
    Federal rate for capital.
    
    A. Determination of Federal Inpatient Capital-Related Prospective 
    Payment Rate Update
    
        For FY 1998, the Federal rate is $371.51. With the changes we are 
    proposing to the factors used to establish the Federal rate, the 
    proposed FY 1999 Federal rate is $377.25.
        In the discussion that follows, we explain the factors that were 
    used to determine the proposed FY 1999 Federal rate. In particular, we 
    explain why the proposed FY 1999 Federal rate has increased 1.55 
    percent compared to the FY 1998 Federal rate. Even though we estimate 
    that Medicare hospital inpatient discharges will decline by 
    approximately 2.25 between FY 1998 and FY 1999, we also estimate that 
    aggregate capital payments will increase by 2.60 percent during this 
    same period. This aggregate increase is primarily due to the change in 
    the federal rate blend percentage from 70 percent to 80 percent, the 
    1.55 percent increase in the rate, and a projected increase in case 
    mix.
        The major factor contributing to the increase in the proposed 
    capital Federal rate for FY 1999 relative to FY 1998 is
    
    [[Page 25614]]
    
    that the proposed FY 1999 exceptions reduction factor is 1.06 percent 
    higher than the factor for FY 1998. The exceptions reduction factor 
    equals 1 minus the projected percentage of exceptions payments. We 
    estimate that the projected percentage of exceptions payments for FY 
    1999 will be lower than the projected percentage for FY 1998; 
    accordingly, the proposed FY 1999 rate reflects less of a reduction to 
    account for exceptions than the FY 1998 rate.
        Total payments to hospitals under the prospective payment system 
    are relatively unaffected by changes in the capital prospective 
    payments. Since capital payments constitute about 10 percent of 
    hospital payments, a 1 percent change in the capital Federal rate 
    yields only about 0.1 percent change in actual payments to hospitals. 
    Aggregate payments under the capital prospective payment transition 
    system are estimated to increase in FY 1999 compared to FY 1998.
    1. Standard Federal Rate Update
        a. Description of the Update Framework. Under section 
    412.308(c)(1), the standard Federal rate is updated on the basis of an 
    analytical framework that takes into account changes in a capital input 
    price index and other factors. The update framework consists of a 
    capital input price index (CIPI) and several policy adjustment factors. 
    Specifically, we have adjusted the projected CIPI rate of increase as 
    appropriate each year for case-mix index related changes, for 
    intensity, and for errors in previous CIPI forecasts. The proposed 
    update factor for FY 1999 under that framework is 0.2 percent. This 
    proposal is based on a projected 0.8 percent increase in the CIPI, 
    policy adjustment factors of -0.2, and a forecast error correction of 
    -0.4 percent. We explain the basis for the FY 1999 CIPI projection in 
    section II.D of this addendum. Here we describe the policy adjustments.
        The case-mix index is the measure of the average DRG weight for 
    cases paid under the prospective payment system. Because the DRG weight 
    determines the prospective payment for each case, any percentage 
    increase in the case-mix index corresponds to an equal percentage 
    increase in hospital payments.
        The case-mix index can change for any of several reasons:
         The average resource use of Medicare patients changes 
    (``real'' case-mix change);
         Changes in hospital coding of patient records result in 
    higher weight DRG assignments (``coding effects''); and
         The annual DRG reclassification and recalibration changes 
    may not be budget neutral (``reclassification effect'').
        We define real case-mix change as actual changes in the mix (and 
    resource requirements) of Medicare patients as opposed to changes in 
    coding behavior that result in assignment of cases to higher-weighted 
    DRGs but do not reflect higher resource requirements. In the update 
    framework for the prospective payment system for operating costs, we 
    adjust the update upwards to allow for real case-mix change, but remove 
    the effects of coding changes on the case-mix index. We also remove the 
    effect on total payments of prior changes to the DRG classifications 
    and relative weights, in order to retain budget neutrality for all 
    case-mix index-related changes other than patient severity. (For 
    example, we adjusted for the effects of the FY 1992 DRG 
    reclassification and recalibration as part of our FY 1994 update 
    recommendation.) The operating adjustment consists of a reduction for 
    total observed case-mix change, an increase for the portion of case-mix 
    change that we determine is due to real case-mix change rather than 
    coding modifications, and an adjustment for the effect of prior DRG 
    reclassification and recalibration changes. We have adopted this case-
    mix index adjustment in the capital update framework as well.
        For FY 1999, we are projecting a 1.0 percent increase in the case-
    mix index. We estimate that real case-mix increase will equal 0.8 
    percent in FY 1999. Therefore, the proposed net adjustment for case-mix 
    change in FY 1999 is -0.2 percentage points.
        We estimate that DRG reclassification and recalibration result in a 
    0.0 percent change in the case mix when compared with the case-mix 
    index that would have resulted if we had not made the reclassification 
    and recalibration changes to the DRGs.
        The capital update framework contains an adjustment for forecast 
    error. The input price index forecast is based on historical trends and 
    relationships ascertainable at the time the update factor is 
    established for the upcoming year. In any given year there may be 
    unanticipated price fluctuations that may result in differences between 
    the actual increase in prices faced by hospitals and the forecast used 
    in calculating the update factors. In setting a prospective payment 
    rate under the proposed framework, we make an adjustment for forecast 
    error only if our estimate of the capital input price index rate of 
    increase for any year is off by 0.25 percentage points or more. There 
    is a 2-year lag between the forecast and the measurement of the 
    forecast error. Thus, for example, we would adjust for a forecast error 
    made in FY 1997 through an adjustment to the FY 1999 update. Because we 
    only introduced this analytical framework in FY 1996, FY 1998 was the 
    first year in which a forecast error adjustment could be required. We 
    estimate that the FY 1997 CIPI was 0.4 percentage points higher than 
    our current data show, which means that we estimate a forecast error of 
    -0.4 percentage points for FY 1997. Therefore we are making an -0.4 
    percent adjustment for forecast error in FY 1999.
        Under the capital prospective payment system framework, we also 
    make an adjustment for changes in intensity. We calculate this 
    adjustment using the same methodology and data as in the framework for 
    the operating prospective payment system. The intensity factor for the 
    operating update framework reflects how hospital services are utilized 
    to produce the final product, that is, the discharge. This component 
    accounts for changes in the use of quality-enhancing services, changes 
    in within-DRG severity, and expected modification of practice patterns 
    to remove cost-ineffective services.
        We calculate case-mix constant intensity as the change in total 
    charges per admission, adjusted for price level changes (the CPI 
    hospital component), and changes in real case mix. The use of total 
    charges in the calculation of the proposed intensity factor makes it a 
    total intensity factor, that is, charges for capital services are 
    already built into the calculation of the factor. We have, therefore, 
    incorporated the intensity adjustment from the operating update 
    framework into the capital update framework. Without reliable estimates 
    of the proportions of the overall annual intensity increases that are 
    due, respectively, to ineffective practice patterns and to the 
    combination of quality-enhancing new technologies and within-DRG 
    complexity, we assume, as in the revised operating update framework, 
    that one-half of the annual increase is due to each of these factors. 
    The capital update framework thus provides an add-on to the input price 
    index rate of increase of one-half of the estimated annual increase in 
    intensity to allow for within-DRG severity increases and the adoption 
    of quality-enhancing technology.
        For FY 1999, we have developed a Medicare-specific intensity 
    measure based on a 5-year average using FY 1993-1997 data. In 
    determining case-mix constant intensity, we found that observed case-
    mix increase was 0.9 percent in FY 1993, 0.8 percent in FY
    
    [[Page 25615]]
    
    1994, 1.7 percent in FY 1995, 1.6 percent in FY 1996, and 0.3 percent 
    in FY 1997. For FY 1995 and FY 1996, we estimate that real case-mix 
    increase was 1.0 to 1.4 percent each year. The estimate for those years 
    is supported by past studies of case-mix change by the RAND 
    Corporation. The most recent study was ``Has DRG Creep Crept Up? 
    Decomposing the Case Mix Index Change Between 1987 and 1988'' by G. M. 
    Carter, J. P. Newhouse, and D. A. Relles, R-4098-HCFA/ProPAC(1991). The 
    study suggested that real case-mix change was not dependent on total 
    change, but was usually a fairly steady 1.0 to 1.5 percent per year. We 
    use 1.4 percent as the upper bound because the RAND study did not take 
    into account that hospitals may have induced doctors to document 
    medical records more completely in order to improve payment. Following 
    that study, we consider up to 1.4 percent of observed case-mix change 
    as real for FY 1992 through FY 1997. Based on this analysis, we believe 
    that all of the observed case-mix increase for FY 1993, FY 1994 and FY 
    1997 is real.
        We calculate case-mix constant intensity as the change in total 
    charges per admission, adjusted for price level changes (the CPI 
    hospital component), and changes in real case-mix. Given estimates of 
    real case mix of 0.9 percent for FY 1993, 0.8 percent for FY 1994, 1.0 
    percent for FY 1995, and 1.0 percent for FY 1996, and 0.3 percent for 
    FY 1997, we estimate that case-mix constant intensity declined by an 
    average 1.5 percent during FYs 1993 through 1997, for a cumulative 
    decrease of 7.3 percent. If we assume that real case-mix increase was 
    0.9 percent for FY 1993, 0.8 percent for FY 1994, 1.4 percent for FY 
    1995, 1.4 percent for FY 1996 and 0.3 percent for FY 1997, we estimate 
    that case-mix constant intensity declined by an average 1.6 percent 
    during FYs 1993 through 1997, for a cumulative decrease of 7.7 percent. 
    Since we estimate that intensity has declined during that period, we 
    are recommending a 0.0 percent intensity adjustment for FY 1999.
        b. Comparison of HCFA and MedPAC Update Recommendations. MedPAC 
    recommends a 0.0 to 0.7 percent update to the standard Federal rate and 
    we are recommending a 0.2 percent update. There are some significant 
    differences between the HCFA and MedPAC update frameworks, which 
    account for the difference in the respective update recommendations. A 
    major difference is the input price index which each framework uses as 
    a beginning point to estimate the change in input prices since the 
    previous year. The HCFA capital input price index (the CIPI) includes 
    price measures for interest expense, which are an indicator of the 
    interest rates facing hospitals during their capital purchasing 
    decisions. The MedPAC capital market basket does not include interest 
    expense; instead the MedPAC update framework includes an adjustment 
    when necessary to account for the prolonged changes in interest rates. 
    HCFA's CIPI is vintage-weighted, meaning that it takes into account 
    price changes from past purchases of capital when determining the 
    current period update. MedPAC's capital market basket is not vintage-
    weighted, accounting only for the current year price changes. This 
    year, due to the difference between HCFA's and MedPAC's input price 
    index, the percentage change in HCFA's CIPI is 0.8 percent, and the 
    percentage change in MedPAC's market basket is 2.4 percent.
        MedPAC and HCFA also differ in the adjustments they make to their 
    price indices. (See Table 1 for a comparison of HCFA and MedPAC's 
    update recommendations.) MedPAC makes an adjustment for productivity, 
    while HCFA has not adopted an adjustment for capital productivity or 
    efficiency. MedPAC employs the same productivity adjustment in its 
    operating and capital framework. We have identified a total intensity 
    factor but have not identified an adequate total productivity measure. 
    The Commission also includes a product change adjustment to account for 
    changes in the service content of hospital stays, which adjusts the 
    base payment rates to eliminate overpayments in the future. MedPAC 
    recommends a -3.0 to a -1.0 adjustment for product change for FY 1999. 
    For FY 1999 MedPAC recommends a -0.7 to a -0.3 adjustment for 
    productivity. We recommend a 0.0 intensity adjustment.
        We recommend a -0.2 total case mix adjustment since we are 
    projecting a 1.0 percent increase in the case mix index and we estimate 
    that real case-mix increase will equal 0.8 percent in FY 1999. MedPAC 
    makes a two part adjustment for case mix changes, which takes into 
    account changes in case mix in the past year. They recommend a -0.2 to 
    -0.0 adjustment for coding change and an 0.0 to 0.2 adjustment for 
    within-DRG complexity change. We recommend a -0.4 adjustment for 
    forecast error correction, and MedPAC recommends a -0.4 adjustment for 
    forecast error correction.
        The net result of these adjustments is that MedPAC's capital update 
    framework suggests a -1.9 to 1.4 percent update. MedPAC has recommended 
    a 0.0 to 0.7 percent update to the rate for FY 1999. This range is 
    consistent with the PPS operating update recommended by the Commission. 
    We describe the basis for our proposed 0.2 percent total update in the 
    preceding section. HCFA and MedPAC's update recommendations are quite 
    close, with HCFA's recommendation within the range recommended by 
    MedPAC.
    
       Table 1.--HCFA's FY 1999 Update Factor and MedPAC's Recommendation   
    ------------------------------------------------------------------------
                                      HCFA's update     MedPAC's recommenda 
                                          factor                tion        
    ------------------------------------------------------------------------
    Capital Input Price Index.....                0.8  2.4                  
    Policy Adjustment Factors:                                              
        Productivity..............  .................  -0.7 to -0.3         
        Intensity.................                0.0  .....................
            Science and Technology  .................  0.0 to 0.5           
            Intensity.............  .................  (\1\)                
            Real within DRG Change  .................  (\2\)                
        Product Change............  .................  -3.0 to -1.0         
                                   -----------------------------------------
              Subtotal............                0.0  -3.7 to -0.8         
                                   =========================================
    Case-Mix Adjustment Factors:                                            
        Projected Case-Mix Change.               -1.0  .....................
        Real Across DRG Change....                0.8  .....................
    
    [[Page 25616]]
    
                                                                            
        Coding Change.............  .................  -0.2 to -0.0         
        Real within DRG Change....              (\3\)  0.0 to 0.2           
                                   -----------------------------------------
              Subtotal............               -0.2  -0.2 to 0.2          
                                   =========================================
    Effect of FY 1996                             0.0  .....................
     Reclassification and                                                   
     Recalibration.                                                         
    Forecast Error Correction.....               -0.4  -0.4                 
                                   -----------------------------------------
          Total Update............                0.2  -1.9 to 1.4          
    ------------------------------------------------------------------------
    \1\ Included in MedPAC's productivity measure.                          
    \2\ Included in MedPAC's case-mix adjustment.                           
    \3\ Included in HCFA's intensity factor.                                
    
    2. Outlier Payment Adjustment Factor
        Section 412.312(c) establishes a unified outlier methodology for 
    inpatient operating and inpatient capital-related costs. A single set 
    of thresholds is used to identify outlier cases for both inpatient 
    operating and inpatient capital-related payments. Outlier payments are 
    made only on the portion of the Federal rate that is used to calculate 
    the hospital's inpatient capital-related payments (for example, 80 
    percent for cost reporting periods beginning in FY 1999 for hospitals 
    paid under the fully prospective methodology). Section 412.308(c)(2) 
    provides that the standard Federal rate for inpatient capital-related 
    costs be reduced by an adjustment factor equal to the estimated 
    proportion of outlier payments under the Federal rate to total 
    inpatient capital-related payments under the Federal rate. The outlier 
    thresholds are set so that operating outlier payments are projected to 
    be 5.1 percent of total operating DRG payments. The inpatient capital-
    related outlier reduction factor reflects the inpatient capital-related 
    outlier payments that would be made if all hospitals were paid 100 
    percent of the Federal rate. For purposes of calculating the outlier 
    thresholds and the outlier reduction factor, we model payments as if 
    all hospitals were paid 100 percent of the Federal rate because, as 
    explained above, outlier payments are made only on the portion of the 
    Federal rate that is included in the hospital's inpatient capital-
    related payments.
        In the August 29, 1997 final rule with comment period, we estimated 
    that outlier payments for capital in FY 1998 would equal 6.18 percent 
    of inpatient capital-related payments based on the Federal rate. 
    Accordingly, we applied an outlier adjustment factor of 0.9382 to the 
    Federal rate. Based on the thresholds as set forth in section II.A.4.d 
    of this Addendum, we estimate that outlier payments for capital will 
    equal 6.22 percent of inpatient capital-related payments based on the 
    Federal rate in FY 1999. We are, therefore, proposing an outlier 
    adjustment factor of 0.9378 to the Federal rate. Thus, estimated 
    capital outlier payments for FY 1999 represent a higher percentage of 
    total capital standard payments than in FY 1998.
        The outlier reduction factors are not built permanently into the 
    rates; that is, they are not applied cumulatively in determining the 
    Federal rate. Therefore, the proposed net change in the outlier 
    adjustment to the Federal rate for FY 1999 is 0.9996 (0.9378/0.9382). 
    Thus, the outlier adjustment decreases the FY 1999 Federal rate by 0.04 
    percent (0.9996--1) compared with the FY 1998 outlier adjustment.
    3. Budget Neutrality Adjustment Factor for Changes in DRG 
    Classifications and Weights and the Geographic Adjustment Factor
        Section 412.308(c)(4)(ii) requires that the Federal rate be 
    adjusted so that aggregate payments for the fiscal year based on the 
    Federal rate after any changes resulting from the annual DRG 
    reclassification and recalibration and changes in the GAF are projected 
    to equal aggregate payments that would have been made on the basis of 
    the Federal rate without such changes. We use the actuarial model, 
    described in Appendix B of this proposed rule, to estimate the 
    aggregate payments that would have been made on the basis of the 
    Federal rate without changes in the DRG classifications and weights and 
    in the GAF. We also use the model to estimate aggregate payments that 
    would be made on the basis of the Federal rate as a result of those 
    changes. We then use these figures to compute the adjustment required 
    to maintain budget neutrality for changes in DRG weights and in the 
    GAF.
        For FY 1998, we calculated a GAF/DRG budget neutrality factor of 
    0.9989. For FY 1999, we are proposing a GAF/DRG budget neutrality 
    factor of 1.0032. The GAF/DRG budget neutrality factors are built 
    permanently into the rates; that is, they are applied cumulatively in 
    determining the Federal rate. This follows from the requirement that 
    estimated aggregate payments each year be no more than they would have 
    been in the absence of the annual DRG reclassification and 
    recalibration and changes in the GAF. The proposed incremental change 
    in the adjustment from FY 1998 to FY 1999 is 1.0032. The proposed 
    cumulative change in the rate due to this adjustment is 1.0034 (the 
    product of the incremental factors for FY 1993, FY 1994, FY 1995, FY 
    1996, FY 1997, FY 1998, and the proposed incremental factor for FY 
    1999: 0.9980  x  1.0053  x  0.9998  x  0.9994  x  0.9987  x  0.9989  x  
    1.0032 = 1.0034).
        This proposed factor accounts for DRG reclassifications and 
    recalibration and for changes in the GAF. It also incorporates the 
    effects on the GAF of FY 1999 geographic reclassification decisions 
    made by the MGCRB compared to FY 1998 decisions. However, it does not 
    account for changes in payments due to changes in the disproportionate 
    share and indirect medical education adjustment factors or in the large 
    urban add-on.
    4. Exceptions Payment Adjustment Factor
        Section 412.308(c)(3) requires that the standard Federal rate for 
    inpatient capital-related costs be reduced by an adjustment factor 
    equal to the estimated proportion of additional payments for exceptions 
    under Sec. 412.348 relative to total payments under the hospital-
    specific rate and Federal rate. We use the model originally developed 
    for determining the budget neutrality adjustment factor to determine 
    the
    
    [[Page 25617]]
    
    exceptions payment adjustment factor. We describe that model in 
    Appendix B to this proposed rule.
        For FY 1998, we estimated that exceptions payments would equal 3.41 
    percent of aggregate payments based on the Federal rate and the 
    hospital-specific rate. Therefore, we applied an exceptions reduction 
    factor of 0.9659 (1-0.0341) in determining the Federal rate. For this 
    proposed rule, we estimate that exceptions payments for FY 1999 will 
    equal 2.39 percent of aggregate payments based on the Federal rate and 
    the hospital-specific rate. Therefore, we are proposing an exceptions 
    payment reduction factor of 0.9761 to the Federal rate for FY 1999. The 
    proposed exceptions reduction factor for FY 1999 is 1.06 percent higher 
    than the factor for FY 1998.
        The exceptions reduction factors are not built permanently into the 
    rates; that is, the factors are not applied cumulatively in determining 
    the Federal rate. Therefore, the proposed net adjustment to the FY 1999 
    Federal rate is 0.9761/0.9659, or 1.0106.
    5. Standard Capital Federal Rate for FY 1999
        For FY 1998, the capital Federal rate was $371.51. With the changes 
    we are proposing to the factors used to establish the Federal rate, the 
    FY 1999 Federal rate would be $377.25. The proposed Federal rate for FY 
    1999 was calculated as follows:
         The proposed FY 1999 update factor is 1.0020, that is, the 
    proposed update is 0.20 percent.
         The proposed FY 1999 budget neutrality adjustment factor 
    that is applied to the standard Federal payment rate for changes in the 
    DRG relative weights and in the GAF is 1.0032.
         The proposed FY 1999 outlier adjustment factor is 0.9378.
         The proposed FY 1999 exceptions payments adjustment factor 
    is 0.9761.
        Since the Federal rate has already been adjusted for differences in 
    case mix, wages, cost of living, indirect medical education costs, and 
    payments to hospitals serving a disproportionate share of low-income 
    patients, we propose to make no additional adjustments in the standard 
    Federal rate for these factors other than the budget neutrality factor 
    for changes in the DRG relative weights and the GAF.
        We are providing a chart that shows how each of the factors and 
    adjustments for FY 1999 affected the computation of the proposed FY 
    1999 Federal rate in comparison to the FY 1998 Federal rate. The 
    proposed FY 1999 update factor has the effect of increasing the Federal 
    rate by 0.20 percent compared to the rate in FY 1998, while the 
    proposed geographic and DRG budget neutrality factor has the effect of 
    increasing the Federal rate by 0.32 percent. The proposed FY 1999 
    outlier adjustment factor has the effect of decreasing the Federal rate 
    by 0.04 percent compared to FY 1998. The proposed FY 1999 exceptions 
    reduction factor has the effect of increasing the Federal rate by 1.06 
    percent compared to the exceptions reduction for FY 1998. The combined 
    effect of all the proposed changes is to increase the proposed Federal 
    rate by 1.55 percent compared to the Federal rate for FY 1998.
    
              Comparison of Factors and Adjustments--FY 1998 Federal Rate and Proposed FY 1999 Federal Rate         
    ----------------------------------------------------------------------------------------------------------------
                                                                               Proposed FY                 Percent  
                                                                     FY 98          99         Change       change  
    ----------------------------------------------------------------------------------------------------------------
    Update factor\1\............................................       1.0090       1.0020       1.0020         0.20
    GAF/DRG Adjustment Factor\1\................................       0.9989       1.0032       1.0032         0.32
    Outlier Adjustment Factor\2\................................       0.9382       0.9378       0.9996        -0.04
    Exceptions Adjustment Factor\2\.............................       0.9659       0.9761       1.0106         1.06
    Federal Rate................................................      $371.51      $377.25       1.0155        1.55 
    ----------------------------------------------------------------------------------------------------------------
    \1\ The update factor and the GAF/DRG budget neutrality factors are built permanently into the rates. Thus, for 
      example, the incremental change from FY 1998 to FY 1999 resulting from the application of the 1.0032 GAF/DRG  
      budget neutrality factor for FY 1999 is 1.0032.                                                               
    \2\ The outlier reduction factor and the exceptions reduction factor are not built permanently into the rates;  
      that is, these factors are not applied cumulatively in determining the rates. Thus, for example, the net      
      change resulting from the application of the FY 1999 outlier reduction factor is 0.9378/0.9382, or 0.9996.    
    
    6. Special Rate for Puerto Rico Hospitals
        As explained at the beginning of this section, hospitals in Puerto 
    Rico are paid based on 50 percent of the Puerto Rico rate and 50 
    percent of the Federal rate. The Puerto Rico rate is derived from the 
    costs of Puerto Rico hospitals only, while the Federal rate is derived 
    from the costs of all acute care hospitals participating in the 
    prospective payment system (including Puerto Rico). To adjust 
    hospitals' capital payments for geographic variations in capital costs, 
    we apply a geographic adjustment factor (GAF) to both portions of the 
    blended rate. The GAF is calculated using the operating PPS wage index 
    and varies depending on the MSA or rural area in which the hospital is 
    located. We use the Puerto Rico wage index to determine the GAF for the 
    Puerto Rico part of the capital blended rate and the national wage 
    index to determine the GAF for the national part of the blended rate.
        Since we implemented a separate GAF for Puerto Rico, we also 
    propose to apply separate budget neutrality adjustments for the 
    national GAF and for the Puerto Rico GAF. We propose to apply the same 
    budget neutrality factor for DRG reclassifications and recalibration 
    nationally and for Puerto Rico. Separate adjustments were unnecessary 
    for FY 1998 since the Puerto Rico specific GAF was implemented that 
    year. The Puerto Rico GAF budget neutrality factor is 0.9989, while the 
    DRG adjustment is 1.0033, for a combined cumulative adjustment of 
    1.0022. (For a more detailed explanation of this proposed change see 
    Appendix B.)
        In computing the payment for a particular Puerto Rico hospital, the 
    Puerto Rico portion of the rate (50%) is multiplied by the Puerto Rico-
    specific GAF for the MSA in which the hospital is located, and the 
    national portion of the rate (50%) is multiplied by the national GAF 
    for the MSA in which the hospital is located (which is computed from 
    national data for all hospitals in the United States and Puerto Rico). 
    In FY 1998, we implemented a 17.78 percent reduction to the Puerto Rico 
    rate as a result of the BBA.
        For FY 1998, before application of the GAF, the special rate for 
    Puerto Rico hospitals was $177.57. With the changes we are proposing to 
    the factors used to determine the rate, the proposed FY 1999 special 
    rate for Puerto Rico is $180.73.
    
    B. Determination of Hospital-Specific Rate Update
    
        Section 412.328(e) of the regulations provides that the hospital-
    specific rate for FY 1999 be determined by adjusting
    
    [[Page 25618]]
    
    the FY 1998 hospital-specific rate by the following factors:
    1. Hospital-Specific Rate Update Factor
        The hospital-specific rate is updated in accordance with the update 
    factor for the standard Federal rate determined under 
    Sec. 412.308(c)(1). For FY 1999, we are proposing that the hospital-
    specific rate be updated by a factor of 1.0020.
    2. Exceptions Payment Adjustment Factor
        For FYs 1992 through FY 2001, the updated hospital-specific rate is 
    multiplied by an adjustment factor to account for estimated exceptions 
    payments for capital-related costs under Sec. 412.348, determined as a 
    proportion of the total amount of payments under the hospital-specific 
    rate and the Federal rate. For FY 1999, we estimate that exceptions 
    payments will be 2.39 percent of aggregate payments based on the 
    Federal rate and the hospital-specific rate. Therefore, we propose that 
    the updated hospital-specific rate be reduced by a factor of 0.9761. 
    The exceptions reduction factors are not built permanently into the 
    rates; that is, the factors are not applied cumulatively in determining 
    the hospital-specific rate. The proposed net adjustment to the FY 1999 
    hospital-specific rate is 0.9761/0.9659, or 1.0106.
    3. Net Change to Hospital-Specific Rate
        We are providing a chart to show the net change to the hospital-
    specific rate. The chart shows the factors for FY 1998 and FY 1999 and 
    the net adjustment for each factor. It also shows that the proposed 
    cumulative net adjustment from FY 1998 to FY 1999 is 1.0126, which 
    represents a proposed increase of 1.26 percent to the hospital-specific 
    rate. For each hospital, the proposed FY 1999 hospital-specific rate is 
    determined by multiplying the FY 1998 hospital-specific rate by the 
    cumulative net adjustment of 1.0126.
    
                           Proposed FY 1999 Update and Adjustments to Hospital-Specific Rates                       
    ----------------------------------------------------------------------------------------------------------------
                                                                               Proposed FY      Net        Percent  
                                                                     FY 98          99       Adjustment     Change  
    ----------------------------------------------------------------------------------------------------------------
    Update Factor...............................................       1.0090       1.0020       1.0020         0.20
    Exceptions Payment Adjustment Factor........................       0.9659       0.9761       1.0106         1.06
    Cumulative Adjustments......................................       0.9746       0.9869       1.0026        1.26 
    ----------------------------------------------------------------------------------------------------------------
    Note: The update factor for the hospital-specific rate is applied cumulatively in determining the rates. Thus,  
      the incremental increase in the update factor from FY 1998 to FY 1999 is 1.0020. In contrast, the exceptions  
      payment adjustment factor is not applied cumulatively. Thus, for example, the incremental increase in the     
      exceptions reduction factor from FY 1998 to FY 1999 is 0.9761/0.9659, or 1.0106.                              
    
    C. Calculation of Inpatient Capital-Related Prospective Payments for FY 
    1999
    
        During the capital prospective payment system transition period, a 
    hospital is paid for the inpatient capital-related costs under one of 
    two payment methodologies--the fully prospective payment methodology or 
    the hold-harmless methodology. The payment methodology applicable to a 
    particular hospital is determined when a hospital comes under the 
    prospective payment system for capital-related costs by comparing its 
    hospital-specific rate to the Federal rate applicable to the hospital's 
    first cost reporting period under the prospective payment system.
        The applicable Federal rate was determined by making adjustments as 
    follows:
         For outliers by dividing the standard Federal rate by the 
    outlier redution factor for that fiscal year; and,
         For the payment adjustment factors applicable to the 
    hospital (that is, the hospital's GAF, the disproportionate share 
    adjustment factor, and the indirect medical education adjustment 
    factor, when appropriate).
         If the hospital-specific rate is above the applicable 
    Federal rate, the hospital is paid under the hold-harmless methodology. 
    If the hospital-specific rate is below the applicable Federal rate, the 
    hospital is paid under the fully prospective methodology.
        For purposes of calculating payments for each discharge under both 
    the hold-harmless payment methodology and the fully prospective payment 
    methodology, the standard Federal rate is adjusted as follows:
        (Standard Federal Rate) x (DRG weight) x (GAF) x (Large Urban Add-
    on, if applicable) x (COLA adjustment for hospitals located in Alaska 
    and Hawaii) x (1 + Disproportionate Share Adjustment Factor + IME 
    Adjustment Factor, if applicable).
        The result is the adjusted Federal rate.
        Payments under the hold-harmless methodology are determined under 
    one of two formulas. A hold-harmless hospital is paid the higher of the 
    following:
         100 percent of the adjusted Federal rate for each 
    discharge; or
         An old capital payment equal to 85 percent (100 percent 
    for sole community hospitals) of the hospital's allowable Medicare 
    inpatient old capital costs per discharge for the cost reporting period 
    plus a new capital payment based on a percentage of the adjusted 
    Federal rate for each discharge. The percentage of the adjusted Federal 
    rate equals the ratio of the hospital's allowable Medicare new capital 
    costs to its total Medicare inpatient capital-related costs in the cost 
    reporting period.
        Once a hospital receives payment based on 100 percent of the 
    adjusted Federal rate in a cost reporting period beginning on or after 
    October 1, 1994 (or the first cost reporting period after obligated 
    capital that is recognized as old capital under Sec. 412.302(c) is put 
    in use for patient care, if later), the hospital continues to receive 
    capital prospective payment system payments on that basis for the 
    remainder of the transition period.
        Payment for each discharge under the fully prospective methodology 
    is the sum of the following:
         The hospital-specific rate multiplied by the DRG relative 
    weight for the discharge and by the applicable hospital-specific 
    transition blend percentage for the cost reporting period; and
         The adjusted Federal rate multiplied by the Federal 
    transition blend percentage.
         The blend percentages for cost reporting periods beginning 
    in FY 1999 are 80 percent of the adjusted Federal rate and 20 percent 
    of the hospital-specific rate.
        Hospitals may also receive outlier payments for those cases that 
    qualify under the thresholds established for each fiscal year. Section 
    412.312(c) provides for a single set of thresholds to identify outlier 
    cases for both inpatient operating and inpatient capital-related 
    payments. Outlier payments are made only on that portion of the Federal 
    rate that is used to calculate the hospital's inpatient capital-related 
    payments. For fully prospective hospitals, that portion is 80 percent 
    of the Federal rate for
    
    [[Page 25619]]
    
    discharges occurring in cost reporting periods beginning during FY 
    1999. Thus, a fully prospective hospital will receive 80 percent of the 
    capital-related outlier payment calculated for the case for discharges 
    occurring in cost reporting periods beginning in FY 1999. For hold-
    harmless hospitals paid 85 percent of their reasonable costs for old 
    inpatient capital, the portion of the Federal rate that is included in 
    the hospital's outlier payments is based on the hospital's ratio of 
    Medicare inpatient costs for new capital to total Medicare inpatient 
    capital costs. For hold-harmless hospitals that are paid 100 percent of 
    the Federal rate, 100 percent of the Federal rate is included in the 
    hospital's outlier payments.
        The proposed outlier thresholds for FY 1999 are in section II.A.4.c 
    of this Addendum. For FY 1999, a case qualifies as a cost outlier if 
    the cost for the case (after standardization for the indirect teaching 
    adjustment and disproportionate share adjustment) is greater than the 
    prospective payment rate for the DRG plus $11,350.
        During the capital prospective payment system transition period, a 
    hospital may also receive an additional payment under an exceptions 
    process if its total inpatient capital-related payments are less than a 
    minimum percentage of its allowable Medicare inpatient capital-related 
    costs. The minimum payment level is established by class of hospital 
    under Sec. 412.348. The proposed minimum payment levels for portions of 
    cost reporting periods occurring in FY 1999 are:
         Sole community hospitals (located in either an urban or 
    rural area), 90 percent;
         Urban hospitals with at least 100 beds and a 
    disproportionate share patient percentage of at least 20.2 percent ; 
    and
         Urban hospitals with at least 100 beds that qualify for 
    disproportionate share payments under Sec. 412.106(c)(2), 80 percent; 
    and
         All other hospitals, 70 percent.
        Under Sec. 412.348(d), the amount of the exceptions payment is 
    determined by comparing the cumulative payments made to the hospital 
    under the capital prospective payment system to the cumulative minimum 
    payment levels applicable to the hospital for each cost reporting 
    period subject to that system. Any amount by which the hospital's 
    cumulative payments exceed its cumulative minimum payment is deducted 
    from the additional payment that would otherwise be payable for a cost 
    reporting period.
        New hospitals are exempted from the capital prospective payment 
    system for their first 2 years of operation and are paid 85 percent of 
    their reasonable costs during that period. A new hospital's old capital 
    costs are its allowable costs for capital assets that were put in use 
    for patient care on or before the later of December 31, 1990 or the 
    last day of the hospital's base year cost reporting period, and are 
    subject to the rules pertaining to old capital and obligated capital as 
    of the applicable date. Effective with the third year of operation, we 
    will pay the hospital under either the fully prospective methodology, 
    using the appropriate transition blend in that Federal fiscal year, or 
    the hold-harmless methodology. If the hold-harmless methodology is 
    applicable, the hold-harmless payment for assets in use during the base 
    period would extend for 8 years, even if the hold-harmless payments 
    extend beyond the normal transition period.
    
    D. Capital Input Price Index
    
    1. Background
        Like the prospective payment hospital operating input price index, 
    the Capital Input Price Index (CIPI) is a fixed-weight price index that 
    measures the price changes associated with costs during a given year. 
    The CIPI differs from the operating input price index in one important 
    aspect--the CIPI reflects the vintage nature of capital, which is the 
    acquisition and use of capital over time. Capital expenses in any given 
    year are determined by the stock of capital in that year (that is, 
    capital that remains on hand from all current and prior capital 
    acquisitions). An index measuring capital price changes needs to 
    reflect this vintage nature of capital. Therefore, the CIPI was 
    developed to capture the vintage nature of capital by using a weighted-
    average of past capital purchase prices up to and including the current 
    year.
        Using Medicare cost reports, AHA data, and Securities Data 
    Corporation data, a vintage-weighted price index was developed to 
    measure price increases associated with capital expenses. We 
    periodically update the base year for the operating and capital input 
    prices to reflect the changing composition of inputs for operating and 
    capital expenses. Currently, the CIPI is based to FY 1992 and was last 
    rebased in 1997. The most recent explanation of the CIPI was discussed 
    in the final rule with comment period for FY 1998 published in the 
    August 29, 1997 Federal Register (62 FR 46050). The following Federal 
    Register documents also describe development and revisions of the 
    methodology involved with the construction of the CIPI: September 1, 
    1992 (57 FR 40016), May 26, 1993 (58 FR 30448), September 1, 1993 (58 
    FR 46490), May 27, 1994 (59 FR 27876), September 1, 1994 (59 FR 45517), 
    June 2, 1995 (60 FR 29229), and September 1, 1995 (60 FR 45815), May 
    31, 1996 (61 FR 27466), August 30, 1996 (61 FR 46196), and June 2, 1997 
    (62 FR 29953).
    2. Forecast of the CIPI for Federal Fiscal Year 1999
        DRI forecasts a 0.8 percent increase in the CIPI for FY 1999. This 
    is the outcome of a projected 2.0 percent increase in vintage-weighted 
    depreciation prices (building and fixed equipment, and movable 
    equipment) and a 2.6 percent increase in other capital expense prices 
    in FY 1999, partially offset by a 2.7 percent decline in vintage-
    weighted interest rates in FY 1999. The weighted average of these three 
    factors produces the 0.8 percent increase for the CIPI as a whole.
    
    IV. Proposed Changes to Payment Rates for Excluded Hospitals and 
    Hospital Units: Rate-of-Increase Percentages
    
    A. Rate-of-Increase Percentages for Excluded Hospitals and Hospital 
    Units
    
        The inpatient operating costs of hospitals and hospital units 
    excluded from the prospective payment system are subject to rate-of-
    increase limits established under the authority of section 1886(b) of 
    the Act, which is implemented in Sec. 413.40 of the regulations. Under 
    these limits, an annual target amount (expressed in terms of the 
    inpatient operating cost per discharge) is set for each hospital, based 
    on the hospital's own historical cost experience trended forward by the 
    applicable rate-of-increase percentages (update factors). In the case 
    of a psychiatric hospital or unit, rehabilitation hospital or unit, or 
    long-term care hospital, the target amount may not exceed the 75th 
    percentile of target amounts for hospitals and units in the same class 
    (psychiatric, rehabilitation, and long-term care). The target amount is 
    multiplied by the number of Medicare discharges in a hospital's cost 
    reporting period, yielding the ceiling on aggregate Medicare inpatient 
    operating costs for the cost reporting period.
        Each hospital's target amount is adjusted annually, at the 
    beginning of its cost reporting period, by an applicable update factor. 
    Section 1886(b)(3)(B) of the Act provides that for cost reporting 
    periods beginning on or after October 1, 1998 and before October 1, 
    1999, the update factor is the market basket less a percentage point 
    between 0 and 2.5 depending on the hospital's or
    
    [[Page 25620]]
    
    unit's costs in relation to the ceiling. For hospitals with costs 
    exceeding the ceiling by 10 percent or more, the update factor is the 
    market basket increase. For hospitals with costs exceeding the ceiling 
    by less than 10 percent, the update factor is the market basket minus 
    .25 percent for each percentage point by which costs are less than 10 
    percent over the ceiling. For hospitals with costs equal to or less 
    than the ceiling but greater than 66.7 percent of the ceiling, the 
    update factor is the greater of 0 percent or the market basket minus 
    2.5 percent. For hospitals with costs that do not exceed 66.7 percent 
    of the ceiling, the update factor is 0.
        The most recent forecast of the market basket increase for FY 1999 
    for hospitals and hospital units excluded from the prospective payment 
    system is 2.5 percent; therefore, the update to a hospital's target 
    amount for its cost reporting period beginning in FY 1999 would be 
    between 0 and 2.5 percent.
        In addition, section 1886(b)(3)(H) of the Act provides that for 
    cost reporting periods beginning on or after October 1, 1998 and before 
    October 1, 1999, the target amount for psychiatric hospitals and units, 
    rehabilitation hospitals and units, and long-term care hospitals will 
    be the lower of the hospital's specific target amount or the 75th 
    percentile target amount for hospitals in the same class. The FY 1998 
    75th percentile target amounts were $10,534 for psychiatric hospitals 
    and units, $19,104 for rehabilitation hospital and units, and $37,688 
    for long-term care hospitals. For 1999, these 75th percentile figures 
    must be updated by the market basket increase. Section 1886(b) of the 
    Act was revised to change the formulas for determining bonus and relief 
    payments for excluded hospitals and also establishes an additional 
    bonus payment for continuous improvement, for cost reporting periods on 
    or after October 1, 1997. Finally, a new statutory payment methodology 
    for new hospitals and units (psychiatric, rehabilitation, and long-term 
    care) was effective October 1, 1997 as governed by section 1886(b)(7) 
    of the Act.
    
    V. Tables
    
        This section contains the tables referred to throughout the 
    preamble to this proposed rule and in this Addendum. For purposes of 
    this proposed rule, and to avoid confusion, we have retained the 
    designations of Tables 1 through 5 that were first used in the 
    September 1, 1983 initial prospective payment final rule (48 FR 39844). 
    Tables 1A, 1C, 1D, 1E, 1F, 3C, 4A, 4B, 4C, 4D, 4E, 4F, 5, 6A, 6B, 6C, 
    6D, 6E, 6F, 6G, 7A, 7B, 8A, and 8B are presented below. The tables 
    presented below are as follows:
    
    Table 1A--National Adjusted Operating Standardized Amounts, Labor/
    Nonlabor
    Table 1C--Adjusted Operating Standardized Amounts for Puerto Rico, 
    Labor/Nonlabor
    Table 1D--Capital Standard Federal Payment Rate
    Table 1E--National Adjusted Operating Standardized Amounts for 
    ``Temporary Relief'' Hospitals, Labor/Nonlabor
    Table 1F--Adjusted Operating Standardized Amounts for ``Temporary 
    Relief'' Hospitals in Puerto Rico, Labor/Nonlabor
    Table 3C--Hospital Case Mix Indexes for Discharges Occurring in Federal 
    Fiscal Year 1997 and Hospital Average Hourly Wage for Federal Fiscal 
    Year 1999 Wage Index
    Table 4A--Wage Index and Capital Geographic Adjustment Factor (GAF) for 
    Urban Areas
    Table 4B--Wage Index and Capital Geographic Adjustment Factor (GAF) for 
    Rural Areas
    Table 4C--Wage Index and Capital Geographic Adjustment Factor (GAF) for 
    Hospitals That Are Reclassified
    Table 4D--Average Hourly Wage for Urban Areas
    Table 4E--Average Hourly Wage for Rural Areas
    Table 4F--Puerto Rico Wage Index and Capital Geographic Adjustment 
    Factor (GAF)
    Table 5--List of Diagnosis Related Groups (DRGs), Relative Weighting 
    Factors, Geometric Mean Length of Stay, and Arithmetic Mean Length of 
    Stay Points Used in the Prospective Payment System
    Table 6A--New Diagnosis Codes
    Table 6B--New Procedure Codes
    Table 6C--Invalid Diagnosis Codes
    Table 6D--Invalid Procedure Codes
    Table 6E--Revised Diagnosis Code Titles
    Table 6F--Additions to the CC Exclusions List
    Table 6G--Deletions to the CC Exclusions List
    Table 7A--Medicare Prospective Payment System Selected Percentile 
    Lengths of Stay FY 97 MEDPAR Update 12/97 GROUPER V15.0
    Table 7B--Medicare Prospective Payment System Selected Percentile 
    Lengths of Stay FY 97 MEDPAR Update 12/97 GROUPER V16.0
    Table 8A--Statewide Average Operating Cost-to-Charge Ratios for Urban 
    and Rural Hospitals (Case Weighted) March 1998
    Table 8B--Statewide Average Capital Cost-to-Charge Ratios (Case 
    Weighted) March 1998
    
                       Table 1A.--National Adjusted Operating Standardized Amounts, Labor/Nonlabor                  
    ----------------------------------------------------------------------------------------------------------------
                        Large urban areas                                           Other areas                     
    ----------------------------------------------------------------------------------------------------------------
           Labor-related               Nonlabor-related              Labor-related             Nonlabor-related     
    ----------------------------------------------------------------------------------------------------------------
    2,776.21...................                   1,128.44                    2,732.26                    1,110.58  
    ----------------------------------------------------------------------------------------------------------------
    
    
                   Table 1C.--Adjusted Operating Standardized Amounts For Puerto Rico, Labor/Nonlabor               
    ----------------------------------------------------------------------------------------------------------------
                                                                      Large urban areas            Other areas      
                                                                 ---------------------------------------------------
                                                                     Labor       Nonlabor      Labor       Nonlabor 
    ----------------------------------------------------------------------------------------------------------------
    National....................................................     2,752.36     1,118.74     2,752.36     1,118.74
    Puerto Rico.................................................     1,323.01       532.55     1,302.07       524.11
    ----------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25621]]
    
    
                Table 1D.--Capital Standard Federal Payment Rate            
    ------------------------------------------------------------------------
                                                                     Rate   
    ------------------------------------------------------------------------
    National...................................................       371.51
    Puerto Rico................................................       177.57
    ------------------------------------------------------------------------
    
    
     Table 1E.--National Adjusted Operating Standardized Amounts For ``Temporary Relief'' Hospitals, Labor/Nonlabor 
    ----------------------------------------------------------------------------------------------------------------
                        Large urban areas                                           Other areas                     
    ----------------------------------------------------------------------------------------------------------------
           Labor-related               Nonlabor-related              Labor-related             Nonlabor-related     
    ----------------------------------------------------------------------------------------------------------------
    2,790.09...................                   1,134.08                    2,745.92                    1,116.13  
    ----------------------------------------------------------------------------------------------------------------
    
    
      Table 1F.--Adjusted Operating Standardized Amounts For ``Temporary Relief'' Hospitals in Puerto Rico, Labor/  
                                                        Nonlabor                                                    
    ----------------------------------------------------------------------------------------------------------------
                                                                      Large urban areas            Other areas      
                                                                 ---------------------------------------------------
                                                                     Labor       Nonlabor      Labor       Nonlabor 
    ----------------------------------------------------------------------------------------------------------------
    National....................................................     2,766.12     1,124.33     2,766.12     1,124.33
    Puerto Rico.................................................     1,329.63       535.21     1,308.58       526.73
    ----------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25622]]
    
    
                     Table 3C.--Hospital Case Mix Indexes for Discharges Occurring in Federal Fiscal Year 1997; Hospital Average Hourly Wage For Federal Fiscal Year 1999 Wage Index                
                                                                                              Page 1 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    010001.......................   01.4634   15.97   010097..........   00.9183   14.87   030006.........   01.5689   18.22   040005.........   01.0400   13.38   040118.........   01.3520   15.27
    010004.......................   01.0055   13.79   010098..........   01.1894   13.02   030007.........   01.3034   17.95   040007.........   01.8696   18.99   040119.........   01.1640   15.33
    010005.......................   01.1699   15.89   010099..........   01.1010   09.13   030008.........   02.2412   14.19   040008.........   01.0301   13.20   040124.........   01.0549   16.23
    010006.......................   01.4636   16.19   010100..........   01.3314   15.67   030009.........   01.2640   17.83   040010.........   01.3262   16.83   040126.........   00.9551   13.26
    010007.......................   01.1300   14.09   010101..........   01.0382   14.69   030010.........   01.4386   20.05   040011.........   00.9590   11.65   040134.........   02.6975  ......
    010008.......................   01.0838   13.76   010102..........   00.9504   12.71   030011.........   01.4734   19.48   040014.........   01.2138   18.12   050002.........   01.5241   27.86
    010009.......................   01.1456   17.50   010103..........   01.8119   17.65   030012.........   01.2358   18.04   040015.........   01.1668   14.80   050006.........   01.5662   20.69
    010010.......................   01.0888   15.40   010104..........   01.6869   18.66   030013.........   01.2951   20.90   040016.........   01.6762   16.66   050007.........   01.5312   27.11
    010011.......................   01.6411   20.28   010108..........   01.2192   16.69   030014.........   01.5263   19.07   040017.........   01.2700   14.62   050008.........   01.4438   25.60
    010012.......................   01.2728   17.45   010109..........   01.1224   13.41   030016.........   01.1871   19.00   040018.........   01.2583   18.08   050009.........   01.6484   24.26
    010015.......................   01.1428   14.04   010110..........   01.0248   14.97   030017.........   01.4718   19.72   040019.........   01.1438   12.08   050013.........   01.8476   23.25
    010016.......................   01.2538   17.40   010112..........   01.1997   14.59   030018.........   01.8083   27.57   040020.........   01.5404   15.42   050014.........   01.1816   23.57
    010018.......................   00.9607   17.72   010113..........   01.6522   15.97   030019.........   01.2636   23.65   040021.........   01.2056   16.15   050015.........   01.3820   24.35
    010019.......................   01.2435   15.00   010114..........   01.3201   16.49   030022.........   01.4160   18.79   040022.........   01.5321   23.41   050016.........   01.1889   18.74
    010021.......................   01.2461   15.83   010115..........   00.8706   08.92   030023.........   01.4822   20.04   040024.........   01.0031   13.38   050017.........   02.0973   24.47
    010022.......................   01.0069   18.25   010117..........   00.8624  .......  030024.........   01.6963   20.87   040025.........   00.9000   12.48   050018.........   01.2579   17.02
    010023.......................   01.6877   16.06   010118..........   01.3033   28.66   030025.........   01.0483   14.97   040026.........   01.5700   17.88   050021.........   01.4154   24.41
    010024.......................   01.4236   15.62   010119..........   00.8398   16.57   030027.........   01.0392   17.17   040027.........   01.2930   13.77   050022.........   01.5819   23.22
    010025.......................   01.3834   14.53   010120..........   01.0107   16.62   030030.........   01.7154   18.21   040028.........   01.0462   14.24   050024.........   01.3639   20.68
    010027.......................   00.8180   36.37   010121..........   01.3471   13.03   030033.........   01.2640   15.67   040029.........   01.2975   17.64   050025.........   01.8279   21.99
    010029.......................   01.6109   17.24   010123..........   01.2883   16.28   030034.........   01.0795   17.44   040030.........   00.8325   12.20   050026.........   01.5433   28.62
    010031.......................   01.2801   17.36   010124..........   01.2886   16.44   030035.........   01.2315   17.93   040032.........   00.9669   11.81   050028.........   01.3707   15.51
    010032.......................   00.9803   13.81   010125..........   01.0743   15.15   030036.........   01.2603   20.35   040035.........   00.9837   10.12   050029.........   01.4900   21.71
    010033.......................   01.9671   18.82   010126..........   01.2171   18.91   030037.........   02.0594   20.18   040036.........   01.5104   17.85   050030.........   01.3267   20.82
    010034.......................   01.1086   14.54   010127..........   01.3575   18.07   030038.........   01.6264   20.57   040037.........   01.1061   12.40   050032.........   01.2557   19.03
    010035.......................   01.1827   17.08   010128..........   00.9738  .......  030040.........   01.1572   14.74   040039.........   01.2394   13.39   050033.........   01.4502   24.74
    010036.......................   01.1899   17.99   010129..........   01.0590   12.94   030041.........   00.9538   14.31   040040.........   00.9817   15.09   050036.........   01.6546   15.95
    010038.......................   01.3028   19.03   010130..........   00.9980   15.85   030043.........   01.2213   17.92   040041.........   01.2978   17.08   050038.........   01.4456   29.35
    010039.......................   01.7055   17.67   010131..........   01.3864   17.25   030044.........   00.9736   16.04   040042.........   01.2567   15.12   050039.........   01.6097   21.59
    010040.......................   01.6110   18.52   010134..........   00.8391   10.86   030047.........   00.9401   18.63   040044.........   01.0524   13.02   050040.........   01.2411   32.71
    010043.......................   01.0489   11.63   010137..........   01.2373   18.84   030049.........   00.9939   20.75   040045.........   01.0079   17.86   050042.........   01.2889   22.76
    010044.......................   01.1028   15.92   010138..........   00.9399   12.43   030054.........   00.8332   14.41   040047.........   01.1013   15.48   050043.........   01.5649   31.83
    010045.......................   01.2056   14.77   010139..........   01.6766   20.38   030055.........   01.2012   17.65   040050.........   01.1795   12.44   050045.........   01.2364   18.69
    010046.......................   01.5054   17.67   010143..........   01.2743   15.07   030059.........   01.3005   22.74   040051.........   01.1670   13.51   050046.........   01.1880   22.24
    010047.......................   00.9884   12.14   010144..........   01.3459   16.59   030060.........   01.1528   17.75   040053.........   01.1178   15.65   050047.........   01.5646   34.07
    010049.......................   01.1575   13.82   010145..........   01.3390   16.15   030061.........   01.6564   20.08   040054.........   01.0532   13.50   050051.........   01.1348   20.91
    010050.......................   01.1489   14.17   010146..........   01.2470   16.83   030062.........   01.2455   16.61   040055.........   01.4655   15.78   050054.........   01.1263   18.44
    010051.......................   00.9234   11.17   010148..........   00.9483  .......  030064.........   01.7664   18.45   040058.........   01.0463   15.12   050055.........   01.3276   22.45
    010052.......................   01.0479   13.68   010149..........   01.3349   17.75   030065.........   01.7843   19.91   040060.........   00.9290   11.03   050056.........   01.3074   24.36
    010053.......................   01.0750   08.17   010150..........   01.1552   15.82   030067.........   01.0939   16.99   040062.........   01.6786   15.55   050057.........   01.5828   20.60
    010054.......................   01.1995   17.28   010152..........   01.2892   16.12   030068.........   01.1092   15.82   040064.........   01.0657   13.92   050058.........   01.4871   25.22
    010055.......................   01.4737   16.47   010155..........   01.0788   10.90   030069.........   01.4037   21.66   040066.........   01.1801   16.36   050060.........   01.5008   18.49
    010056.......................   01.3306   19.46   020001..........   01.5208   27.19   030071.........   01.0057  .......  040067.........   01.2165   12.63   050061.........   01.3507   22.13
    010058.......................   00.9765   13.47   020002..........   01.0595   24.09   030072.........   00.8620  .......  040069.........   01.1095   15.47   050063.........   01.4701   23.89
    010059.......................   01.0774   15.44   020004..........   01.1712   25.49   030073.........   01.0041  .......  040070.........   00.9098   14.25   050065.........   01.7005   21.95
    010061.......................   01.1893   15.80   020005..........   00.9285   28.73   030074.........   00.9408  .......  040071.........   01.6234   16.49   050066.........   01.2265   19.77
    010062.......................   01.0206   13.27   020006..........   01.1834   25.07   030075.........   00.8242  .......  040072.........   01.0982   15.41   050067.........   01.3204   21.48
    010064.......................   01.7552   20.86   020007..........   00.9834   25.64   030076.........   00.9614  .......  040074.........   01.2503   16.30   050068.........   01.1315   19.98
    010065.......................   01.3692   15.35   020008..........   01.1238   30.06   030077.........   00.8060  .......  040075.........   01.0369   12.15   050069.........   01.6246   24.57
    010066.......................   00.9184   10.89   020009..........   00.8881   25.77   030078.........   01.0727  .......  040076.........   01.0407   16.99   050070.........   01.3716   31.44
    010068.......................   01.2837   17.18   020010..........   01.0169   25.93   030079.........   00.8528  .......  040077.........   01.0621   12.57   050071.........   01.3791   33.07
    010069.......................   01.1851   12.84   020011..........   00.9299   25.75   030080.........   01.5008   19.77   040078.........   01.5099   22.64   050072.........   01.4414   32.14
    010072.......................   01.1579   15.22   020012..........   01.2746   26.15   030083.........   01.3763   22.10   040080.........   01.0790   16.38   050073.........   01.3063   33.68
    010073.......................   01.0650   11.04   020013..........   01.0266   26.76   030084.........   01.1228  .......  040081.........   00.9679   10.85   050075.........   01.3412   32.86
    010078.......................   01.2573   17.97   020014..........   01.1152   22.90   030085.........   01.4617   18.59   040082.........   01.2191   14.71   050076.........   01.9181   32.26
    010079.......................   01.2411   14.42   020017..........   01.4752   25.14   030086.........   01.4318   20.19   040084.........   01.1006   16.62   050077.........   01.6304   24.52
    010081.......................   01.8296   17.69   020018..........   00.9680  .......  030087.........   01.6536   19.77   040085.........   01.1954   15.29   050078.........   01.3632   25.59
    010083.......................   01.0337   15.64   020019..........   00.9067  .......  030088.........   01.4231   19.42   040088.........   01.4395   13.39   050079.........   01.5434   31.90
    010084.......................   01.5048   18.27   020020..........   00.7369  .......  030089.........   01.6391   19.70   040090.........   00.9349   14.77   050080.........   01.4214   19.44
    010085.......................   01.2796   17.32   020021..........   00.8551  .......  030092.........   01.6833   21.25   040091.........   01.1266   18.55   050082.........   01.6661   21.99
    010086.......................   01.0395   15.44   020024..........   01.1349   22.66   030093.........   01.3770   18.77   040093.........   00.9413   13.01   050084.........   01.6759   22.53
    010087.......................   01.6587   16.36   020025..........   01.0164   26.32   030094.........   01.2784   19.19   040100.........   01.2392   12.91   050088.........   00.9877   19.55
    010089.......................   01.2392   18.50   020026..........   01.2873  .......  030095.........   01.0461   18.85   040105.........   01.0353   13.05   050089.........   01.3688   18.85
    010090.......................   01.6235   17.44   020027..........   01.0891  .......  030099.........   00.9439  .......  040106.........   01.0675   13.53   050090.........   01.2668   23.85
    010091.......................   01.0247   13.51   030001..........   01.3399   19.87   040001.........   01.1079   13.42   040107.........   01.1428   16.75   050091.........   01.1370   21.99
    010092.......................   01.4011   15.82   030002..........   01.7944   20.96   040002.........   01.1468   13.33   040109.........   01.1342   13.95   050092.........   00.9386   16.26
    010094.......................   01.2128   16.01   030003..........   02.0396   22.65   040003.........   01.0880   13.97   040114.........   01.8758   17.98   050093.........   01.5500   23.90
    010095.......................   00.9779   12.73   030004..........   01.1011   12.52   040004.........   01.6709   17.69   040116.........   01.2656   16.72   050096.........   01.2374   21.29
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25623]]
    
    
                                                                                              Page 2 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    050097.......................   01.3873   18.48   050204..........   01.5825   24.52   050313.........   01.2044   22.00   050443.........   00.9057   18.82   050571.........   01.5096   20.05
    050099.......................   01.4747   23.55   050205..........   01.2709   21.52   050315.........   01.3579   20.47   050444.........   01.2967   22.54   050573.........   01.6294   28.41
    050100.......................   01.6983   33.49   050207..........   01.2640   20.02   050317.........   01.2655   21.86   050446.........   00.9770   10.06   050575.........   01.1367  ......
    050101.......................   01.4168   31.68   050211..........   01.3186   30.67   050320.........   01.2324   27.70   050447.........   01.0672   18.58   050577.........   01.4644   20.19
    050102.......................   01.3532   17.01   050213..........   01.5794   22.96   050324.........   01.9664   26.19   050448.........   01.0974   20.95   050578.........   01.4689   30.62
    050103.......................   01.5661   23.46   050214..........   01.4659   21.31   050325.........   01.2308   21.08   050449.........   01.3366   21.14   050579.........   01.4970   28.52
    050104.......................   01.4815   23.94   050215..........   01.5572   29.63   050327.........   01.5599   18.67   050454.........   01.8425   25.82   050580.........   01.4380   27.74
    050107.......................   01.4511   23.02   050217..........   01.3457   19.08   050329.........   01.2928   19.88   050455.........   01.7746   16.56   050581.........   01.3930   24.39
    050108.......................   01.8295   23.87   050219..........   01.1139   18.83   050331.........   01.4843   24.20   050456.........   01.1694   16.92   050583.........   01.6266   21.88
    050110.......................   01.1656   20.59   050222..........   01.6256   31.91   050333.........   01.1427   24.96   050457.........   02.0310   31.03   050584.........   01.1966   20.18
    050111.......................   01.3578   20.16   050224..........   01.5705   23.23   050334.........   01.7269   34.59   050459.........   01.2985   29.51   050585.........   01.2772   27.19
    050112.......................   01.4824   19.36   050225..........   01.6075   22.02   050335.........   01.4534   21.39   050464.........   01.8738   22.01   050586.........   01.3490   20.52
    050113.......................   01.3756   31.25   050226..........   01.4119   24.79   050336.........   01.3695   20.14   050468.........   01.3879   19.71   050588.........   01.3220   24.70
    050114.......................   01.3693   23.13   050228..........   01.2880   30.89   050342.........   01.3706   17.71   050469.........   01.0972   16.63   050589.........   01.2474   24.07
    050115.......................   01.5640   20.46   050230..........   01.3342   25.40   050343.........   01.0225   14.95   050470.........   01.1474   18.51   050590.........   01.3578   24.92
    050116.......................   01.4487   23.36   050231..........   01.6681   25.54   050348.........   01.6579   25.44   050471.........   01.8883   23.41   050591.........   01.3784   22.87
    050117.......................   01.4515   20.79   050232..........   01.7123   21.50   050349.........   00.8825   14.57   050476.........   01.3512   21.10   050592.........   01.3661   18.46
    050118.......................   01.1901   23.81   050234..........   01.2536   30.23   050350.........   01.3957   24.28   050477.........   01.4936   26.90   050593.........   01.1846  ......
    050121.......................   01.3531   24.60   050235..........   01.6014   24.55   050351.........   01.4653   32.84   050478.........   00.9635   21.11   050594.........   01.6739   19.05
    050122.......................   01.5966   26.85   050236..........   01.4693   25.40   050352.........   01.3034   19.07   050481.........   01.4648   27.13   050597.........   01.2665   21.36
    050124.......................   01.3182   17.12   050238..........   01.5517   24.76   050353.........   01.6669   24.77   050482.........   01.0978   16.07   050598.........   01.3875   32.07
    050125.......................   01.3970   27.55   050239..........   01.5877   21.67   050355.........   00.9808   16.04   050483.........   01.1821   22.22   050599.........   01.6318   23.23
    050126.......................   01.5414   24.94   050240..........   01.4863   21.17   050357.........   01.4011   23.77   050485.........   01.6561   23.81   050601.........   01.6150   32.05
    050127.......................   01.3406   24.15   050241..........   01.2337   26.32   050359.........   01.2854   19.11   050486.........   01.3493   23.00   050603.........   01.4035   22.60
    050128.......................   01.6211   21.63   050242..........   01.4284   29.91   050360.........   01.4136   31.05   050488.........   01.3349   32.94   050604.........   01.5622   37.27
    050129.......................   01.6194   14.25   050243..........   01.5930   22.58   050366.........   01.3455   22.32   050491.........   01.1935   21.97   050607.........   01.1545   20.69
    050131.......................   01.3023   29.90   050245..........   01.4385   23.33   050367.........   01.2485   27.64   050492.........   01.4113   22.37   050608.........   01.3080   15.26
    050132.......................   01.4257   23.74   050248..........   01.2618   27.54   050369.........   01.2376   21.58   050494.........   01.2167   26.20   050609.........   01.4505   32.31
    050133.......................   01.2911   25.55   050251..........   01.0989   14.91   050373.........   01.4446   24.31   050496.........   01.7259   31.88   050613.........   01.0696   31.83
    050135.......................   01.3964   25.36   050253..........   01.2992   25.63   050376.........   01.3991   26.32   050497.........   00.8270   10.59   050615.........   01.6042   23.31
    050136.......................   01.4011   24.04   050254..........   01.2141   14.11   050377.........   00.9333   19.49   050498.........   01.2434   24.96   050616.........   01.3591   22.85
    050137.......................   01.4012   30.81   050256..........   01.7518   23.91   050378.........   01.1364   20.86   050502.........   01.7222   22.74   050618.........   01.1163   22.63
    050138.......................   01.9630   33.22   050257..........   01.1275   19.38   050379.........   00.9589   15.15   050503.........   01.3400   23.15   050623.........   02.0034   27.05
    050139.......................   01.2532   31.55   050260..........   01.0044   24.07   050380.........   01.6867   29.30   050506.........   01.4395   27.49   050624.........   01.3554   22.18
    050140.......................   01.2757   31.54   050261..........   01.2723   18.81   050382.........   01.3984   23.86   050510.........   01.3791   31.86   050625.........   01.6074   25.23
    050144.......................   01.6355   29.12   050262..........   01.8576   27.43   050385.........   01.4021   26.64   050512.........   01.5743   33.03   050630.........   01.3401   23.93
    050145.......................   01.3861   31.48   050264..........   01.3335   27.45   050388.........   00.9019   20.64   050515.........   01.3473   32.36   050633.........   01.3131   21.95
    050146.......................   01.4762  .......  050267..........   01.6544   27.78   050390.........   01.1857   16.75   050516.........   01.5400   26.16   050636.........   01.5051   26.10
    050148.......................   01.1151   21.00   050270..........   01.3573   24.13   050391.........   01.3292   21.68   050517.........   01.1822   19.69   050638.........   01.1025   24.90
    050149.......................   01.4748   22.78   050272..........   01.3703   21.55   050392.........   00.9917   18.42   050522.........   01.2252   30.95   050641.........   01.2588   14.88
    050150.......................   01.2678   23.95   050274..........   00.9903   21.63   050393.........   01.4860   17.95   050523.........   01.2384   28.96   050643.........   00.8426  ......
    050152.......................   01.3850   23.39   050276..........   01.2072   33.01   050394.........   01.5488   20.22   050526.........   01.3236   13.42   050644.........   01.0506   22.44
    050153.......................   01.6231   28.40   050277..........   01.4723   19.05   050396.........   01.6148   24.12   050528.........   01.2785   19.70   050660.........   01.4613  ......
    050155.......................   01.0917   22.33   050278..........   01.5669   22.63   050397.........   00.9890   20.00   050531.........   01.1762   20.18   050661.........   00.8186   20.05
    050158.......................   01.3649   27.94   050279..........   01.3441   19.04   050401.........   01.1257   19.64   050534.........   01.4679   23.66   050662.........   00.8651   33.41
    050159.......................   01.2998   19.09   050280..........   01.7639   25.90   050404.........   01.0765   15.96   050535.........   01.3453   23.23   050663.........   01.1547   24.12
    050167.......................   01.2885   21.83   050281..........   01.5490   33.56   050406.........   01.0708   19.56   050537.........   01.3680   18.57   050666.........   00.9460   34.46
    050168.......................   01.5276   22.07   050282..........   01.3068   23.58   050407.........   01.3597   29.45   050539.........   01.2567   19.52   050667.........   01.0189   28.01
    050169.......................   01.4399   24.49   050283..........   01.5231   27.35   050410.........   01.0632   13.08   050541.........   01.5665   33.44   050668.........   01.1332   39.35
    050170.......................   01.4906   21.04   050286..........   00.8525   18.46   050411.........   01.3589   33.17   050542.........   01.1186   14.45   050670.........   00.7487   20.84
    050172.......................   01.2523   19.87   050289..........   01.6964   30.78   050414.........   01.3074   23.74   050543.........   00.9409   23.72   050674.........   01.3219   32.55
    050173.......................   01.3729   21.72   050290..........   01.6895   33.81   050417.........   01.3155   20.45   050545.........   00.8583   27.87   050675.........   01.9709   14.65
    050174.......................   01.6799   29.40   050291..........   01.1544   30.54   050419.........   01.4360   16.25   050546.........   00.6946   31.14   050676.........   00.9474   16.75
    050175.......................   01.3660   23.84   050292..........   01.0469   22.19   050420.........   01.3375   23.41   050547.........   00.8417   36.25   050677.........   01.3998   32.89
    050177.......................   01.2731   16.69   050293..........   01.1254   20.70   050423.........   01.0173   19.31   050549.........   01.7120   26.33   050678.........   01.2229  ......
    050179.......................   01.3003   21.22   050295..........   01.4947   21.01   050424.........   01.8153   23.48   050550.........   01.4607   22.49   050680.........   01.1971   28.94
    050180.......................   01.6017   32.17   050296..........   01.1902   23.74   050425.........   01.3094   34.22   050551.........   01.3289   24.83   050682.........   00.8928   22.32
    050183.......................   01.1126   19.44   050298..........   01.3275   22.54   050426.........   01.3708   25.47   050552.........   01.2293   20.52   050684.........   01.2450   17.19
    050186.......................   01.2933   27.51   050299..........   01.3607   20.49   050427.........   00.9189   19.93   050557.........   01.5109   21.78   050685.........   01.2468   28.37
    050188.......................   01.4286   26.90   050300..........   01.4936   19.23   050430.........   01.0555   19.53   050559.........   01.3996   23.82   050686.........   01.3134   32.42
    050189.......................   01.0831   22.39   050301..........   01.2481   24.81   050432.........   01.6129   22.37   050561.........   01.1996   32.15   050688.........   01.2792   25.15
    050191.......................   01.4729   20.67   050302..........   01.3482   27.55   050433.........   01.1058   20.42   050564.........   01.3309   06.57   050689.........   01.4155   30.16
    050192.......................   01.1901   20.19   050305..........   01.5457   29.10   050434.........   01.1365   19.87   050565.........   01.3544   13.81   050690.........   01.5124   32.17
    050193.......................   01.3308   22.67   050307..........   01.3027   19.99   050435.........   01.2208   29.08   050566.........   00.9061   13.99   050693.........   01.3049   29.48
    050194.......................   01.2435   27.41   050308..........   01.4832   27.92   050436.........   00.9412   15.20   050567.........   01.6269   24.54   050694.........   01.3586   18.36
    050195.......................   01.5834   33.92   050309..........   01.3376   24.61   050438.........   01.8098   19.83   050568.........   01.3990   19.06   050695.........   01.0960   28.46
    050196.......................   01.3052   15.36   050310..........   01.0912   20.24   050440.........   01.3403   18.63   050569.........   01.3783   23.26   050696.........   02.3021   26.75
    050197.......................   01.8716   30.49   050312..........   01.9222   24.66   050441.........   02.0343   26.41   050570.........   01.7110   23.79   050697.........   01.4515   20.60
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25624]]
    
    
                                                                                              Page 3 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    050698.......................   00.9075  .......  060073..........   01.0655   16.43   100009.........   01.4921   21.67   100102.........   01.0245   18.11   100210.........   01.6031   18.18
    050699.......................   00.6236   20.97   060075..........   01.3102   24.34   100010.........   01.5263   24.50   100103.........   00.9830   16.14   100211.........   01.3282   20.20
    050700.......................   01.5678   31.31   060076..........   01.3829   19.28   100012.........   01.6950   16.74   100105.........   01.4360   21.03   100212.........   01.6623   20.46
    050701.......................   01.3360   30.27   060085..........   00.9348   12.76   100014.........   01.4918   21.94   100106.........   01.0823   16.69   100213.........   01.5199   18.60
    050704.......................   01.1294   15.23   060087..........   01.6777   21.08   100015.........   01.4344   17.47   100107.........   01.3253   18.60   100217.........   01.3379   18.88
    050707.......................   01.0702   27.09   060088..........   00.9931   23.16   100017.........   01.4976   17.71   100108.........   01.0633   14.31   100220.........   01.7265   26.34
    050708.......................   01.2629   22.59   060090..........   00.9777   13.54   100018.........   01.5086   21.03   100109.........   01.3838   18.97   100221.........   01.7374   25.21
    050709.......................   01.3280   18.88   060096..........   01.0685   21.94   100019.........   01.5290   19.50   100110.........   01.4040   20.80   100222.........   01.4127   20.13
    050710.......................   01.3480   26.13   060100..........   01.5060  .......  100020.........   01.3336   23.86   100112.........   00.9244   12.57   100223.........   01.4858   18.81
    050713.......................   00.8060  .......  060103..........   01.2902   23.16   100022.........   01.9055   24.49   100113.........   02.1161   19.93   100224.........   01.4049   20.57
    050714.......................   01.3480  .......  060104..........   01.2502   21.91   100023.........   01.4358   17.35   100114.........   01.4078   18.20   100225.........   01.4014   20.59
    050715.......................   01.7138  .......  060107..........   01.1286  .......  100024.........   01.3638   19.67   100117.........   01.3161   19.37   100226.........   01.4003   18.53
    050716.......................   03.8652  .......  070001..........   01.7599   25.86   100025.........   01.8449   18.06   100118.........   01.2409   19.51   100228.........   01.3287   20.31
    050717.......................   00.8003  .......  070002..........   01.8086   24.34   100026.........   01.5872   18.06   100121.........   01.2121   16.03   100229.........   01.3032   18.10
    050718.......................   00.9336  .......  070003..........   01.1454   25.30   100027.........   00.9920   15.86   100122.........   01.3058   16.67   100230.........   01.3648   22.35
    050899.......................   00.5288  .......  070004..........   01.2352   24.34   100028.........   01.2339   18.03   100124.........   01.3284   14.64   100231.........   01.7051   16.97
    060001.......................   01.6504   20.31   070005..........   01.4131   24.84   100029.........   01.4199   19.56   100125.........   01.3273   18.00   100232.........   01.3660   19.83
    060003.......................   01.3293   18.91   070006..........   01.4122   27.20   100030.........   01.3066   19.01   100126.........   01.4408   18.89   100234.........   01.5349   18.94
    060004.......................   01.2793   20.57   070007..........   01.3912   24.35   100032.........   01.8893   17.78   100127.........   01.6387   19.58   100235.........   01.5525   17.92
    060006.......................   01.1829   18.36   070008..........   01.2534   22.94   100034.........   01.7634   19.44   100128.........   02.1517   21.53   100236.........   01.4246   19.87
    060007.......................   01.1389   15.33   070009..........   01.2944   24.56   100035.........   01.6050   17.98   100129.........   01.2696   17.72   100237.........   02.2024   23.28
    060008.......................   01.1684   15.83   070010..........   01.6774   20.35   100038.........   01.5798   18.23   100130.........   01.2454   18.62   100238.........   01.5894   13.88
    060009.......................   01.4660   21.35   070011..........   01.4579   23.69   100039.........   01.5397   21.36   100131.........   01.3794   20.96   100239.........   01.4442   19.35
    060010.......................   01.5585   22.31   070012..........   01.2488   23.36   100040.........   01.7626   17.97   100132.........   01.3098   19.53   100240.........   00.7775   15.37
    060011.......................   01.3645   22.12   070015..........   01.4162   24.05   100043.........   01.3643   15.33   100134.........   00.9935   13.03   100241.........   00.9329   13.90
    060012.......................   01.4391   18.62   070016..........   01.3810   23.00   100044.........   01.4082   21.18   100135.........   01.6123   17.62   100242.........   01.4132   16.91
    060013.......................   01.3221   16.29   070017..........   01.3702   24.60   100045.........   01.4052   19.25   100137.........   01.3170   18.60   100243.........   01.4048   24.16
    060014.......................   01.7402  .......  070018..........   01.4229   28.54   100046.........   01.4822   20.36   100138.........   01.0153   10.76   100244.........   01.4078   19.39
    060015.......................   01.5816   21.13   070019..........   01.2953   24.83   100047.........   01.7725   18.92   100139.........   01.1145   15.04   100246.........   01.4106   17.86
    060016.......................   01.2616   17.07   070020..........   01.3139   24.55   100048.........   00.9695   13.58   100140.........   01.2249   17.48   100248.........   01.6271   18.75
    060018.......................   01.2400   17.15   070021..........   01.2930   24.85   100049.........   01.3276   17.97   100142.........   01.2594   18.68   100249.........   01.3503   18.84
    060020.......................   01.6773   17.56   070022..........   01.8192   23.48   100050.........   01.1456   15.90   100144.........   01.2818   19.61   100252.........   01.2846   21.94
    060022.......................   01.6160   19.49   070024..........   01.3153   23.84   100051.........   01.2118   19.11   100146.........   01.0877   16.15   100253.........   01.5082   20.97
    060023.......................   01.6591   17.02   070025..........   01.8600   19.43   100052.........   01.4303   16.90   100147.........   01.0605   14.54   100254.........   01.5827   18.66
    060024.......................   01.7966   22.84   070026..........   01.1616   18.55   100053.........   01.2198   18.09   100150.........   01.3984   19.96   100255.........   01.2900   24.34
    060027.......................   01.6866   21.24   070027..........   01.2854   23.11   100054.........   01.3283   17.76   100151.........   01.7240   18.08   100256.........   02.0081   18.90
    060028.......................   01.4966   21.55   070028..........   01.5443   24.77   100055.........   01.3757   17.93   100154.........   01.5955   19.74   100258.........   01.6280   21.07
    060029.......................   00.9005   15.35   070029..........   01.3587   21.95   100056.........   01.4068   19.38   100156.........   01.2007   19.92   100259.........   01.4194   18.73
    060030.......................   01.3241   19.00   070030..........   01.2292   25.18   100057.........   01.4184   18.63   100157.........   01.5860   21.06   100260.........   01.4513   21.73
    060031.......................   01.6355   19.53   070031..........   01.2535   23.12   100060.........   01.7365   21.02   100159.........   00.9550   11.69   100262.........   01.3943   21.16
    060032.......................   01.4770   20.78   070033..........   01.4122   26.38   100061.........   01.4813   21.68   100160.........   01.2495   18.43   100263.........   01.2482   18.64
    060033.......................   01.0722   13.41   070034..........   01.3825   29.05   100062.........   01.7465   18.11   100161.........   01.7073   21.30   100264.........   01.4012   17.62
    060034.......................   01.5666  .......  070035..........   01.4072   22.69   100063.........   01.2890   18.31   100162.........   01.4540   19.83   100265.........   01.3352   15.01
    060036.......................   01.1694   15.76   070036..........   01.5709   27.95   100067.........   01.4095   16.81   100165.........   01.1337   13.18   100266.........   01.3566   18.10
    060037.......................   01.0286   13.56   070038..........   01.0707  .......  100068.........   01.3733   17.72   100166.........   01.4808   19.75   100267.........   01.3379   19.83
    060038.......................   01.0310   13.78   070039..........   00.9302   23.64   100069.........   01.3153   15.88   100167.........   01.4454   20.58   100268.........   01.2241   22.61
    060041.......................   00.9383   14.14   080001..........   01.7025   27.32   100070.........   01.4966   18.19   100168.........   01.3650   19.91   100269.........   01.4247   20.37
    060042.......................   01.0363   14.73   080002..........   01.2023   15.33   100071.........   01.2953   16.97   100169.........   01.8710   20.54   100270.........   00.8682   20.06
    060043.......................   00.9025   12.99   080003..........   01.3849   20.16   100072.........   01.2360   23.32   100170.........   01.4100   15.49   100271.........   01.7428   20.02
    060044.......................   01.1085   16.07   080004..........   01.3094   19.45   100073.........   01.7511   20.04   100172.........   01.3995   14.68   100275.........   01.4146   20.36
    060046.......................   01.0901   18.50   080006..........   01.4184   21.83   100075.........   01.6523   18.22   100173.........   01.6957   17.25   100276.........   01.2702   22.13
    060047.......................   00.9872   13.98   080007..........   01.4486   16.75   100076.........   01.3180   17.07   100174.........   01.3787   17.95   100277.........   01.0519   15.24
    060049.......................   01.3479   20.25   090001..........   01.5888   27.79   100077.........   01.3753   16.82   100175.........   01.2198   15.49   100279.........   01.3775   12.47
    060050.......................   01.2593   16.03   090002..........   01.3122   19.74   100078.........   01.1969   16.33   100176.........   02.0937   23.45   100280.........   01.3550   16.99
    060052.......................   01.0840   13.49   090003..........   01.3697   25.82   100079.........   01.6561   19.15   100177.........   01.3473   18.58   100281.........   01.3003   22.78
    060053.......................   01.1047   14.93   090004..........   01.7397   24.43   100080.........   01.6318   22.70   100179.........   01.7319   19.47   100282.........   01.1124   17.70
    060054.......................   01.3319   18.61   090005..........   01.3450   23.71   100081.........   01.0539   14.21   100180.........   01.4631   19.43   110001.........   01.3047   15.63
    060056.......................   00.9946   15.37   090006..........   01.3214   20.39   100082.........   01.4614   18.91   100181.........   01.2111   21.61   110002.........   01.3058   16.54
    060057.......................   01.0133   23.55   090007..........   01.3635   19.38   100084.........   01.4186   20.77   100183.........   01.2830   18.48   110003.........   01.3845   15.24
    060058.......................   00.9506   15.60   090008..........   01.4969   20.72   100085.........   01.3915   21.33   100187.........   01.4150   19.92   110004.........   01.3881   18.05
    060060.......................   00.9769   14.53   090010..........   01.0223   17.93   100086.........   01.2392   21.23   100189.........   01.3952   24.14   110005.........   01.1802   17.38
    060062.......................   00.9096   16.53   090011..........   02.0090   25.70   100087.........   01.8553   21.28   100191.........   01.2949   20.19   110006.........   01.4001   19.78
    060064.......................   01.4880   21.56   100001..........   01.4825   16.62   100088.........   01.6726   21.08   100199.........   01.3616   19.76   110007.........   01.6056   16.12
    060065.......................   01.3260   22.85   100002..........   01.4763   19.92   100090.........   01.3888   17.89   100200.........   01.3456   21.55   110008.........   01.2651   18.30
    060066.......................   01.0226   15.09   100004..........   01.0119   13.82   100092.........   01.5281   19.47   100204.........   01.6026   19.37   110009.........   01.1532   15.80
    060068.......................   01.0475   18.74   100006..........   01.6406   20.10   100093.........   01.5080   15.93   100206.........   01.3988   19.96   110010.........   02.1459   24.74
    060070.......................   01.1221   17.17   100007..........   01.8866   20.87   100098.........   01.1552   19.33   100208.........   01.5848   22.72   110011.........   01.2262   16.24
    060071.......................   01.2194   16.52   100008..........   01.7096   20.20   100099.........   01.2922   13.50   100209.........   01.5855   17.58   110013.........   01.1130   16.61
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25625]]
    
    
                                                                                              Page 4 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    110014.......................   01.0448   16.21   110101..........   01.1323   12.27   110198.........   01.3303   25.48   130048.........   01.0690   14.17   140081.........   01.0654   14.36
    110015.......................   01.1788   19.15   110103..........   00.9185   11.59   110200.........   01.8824   19.23   130049.........   01.2597   19.05   140082.........   01.4505   22.85
    110016.......................   01.2943   16.27   110104..........   01.0983   15.18   110201.........   01.5092   18.30   130054.........   00.8904   17.88   140083.........   01.3069   18.82
    110017.......................   00.8766   13.46   110105..........   01.2904   15.96   110203.........   00.9956   20.45   130056.........   00.8204   17.37   140084.........   01.2298   19.27
    110018.......................   01.1447   18.80   110107..........   01.8386   18.54   110204.........   00.8148   18.89   130060.........   01.3078   20.72   140086.........   01.1655   15.72
    110020.......................   01.3285   18.61   110108..........   00.9689   17.58   110205.........   01.0763   22.85   130061.........   00.9403   09.29   140087.........   01.3956   17.07
    110023.......................   01.2840   18.65   110109..........   01.0955   15.30   110207.........   01.1607   12.46   130063.........   01.1768  .......  140088.........   01.7029   21.97
    110024.......................   01.4669   19.21   110111..........   01.1955   15.74   110208.........   00.9903   15.74   140001.........   01.3044   15.14   140089.........   01.2384   17.29
    110025.......................   01.4282   17.90   110112..........   01.1297   18.83   110209.........   00.7381   16.57   140002.........   01.3201   18.33   140090.........   01.4953   23.24
    110026.......................   01.2060   14.58   110113..........   01.1014   14.21   110211.........   00.9586  .......  140003.........   01.0457   15.69   140091.........   01.8169   18.10
    110027.......................   01.1287   15.90   110114..........   01.0561   15.10   110212.........   01.1651  .......  140004.........   01.0989   16.55   140093.........   01.1840   18.79
    110028.......................   01.6783   20.65   110115..........   01.6734   22.60   110213.........   00.7480  .......  140005.........   00.9503   10.22   140094.........   01.3097   20.06
    110029.......................   01.3697   20.27   110118..........   01.0544   11.38   120001.........   01.8279   27.25   140007.........   01.4925   21.24   140095.........   01.3835   20.89
    110030.......................   01.2736   17.81   110120..........   01.0683   12.89   120002.........   01.2601   23.99   140008.........   01.5269   20.27   140097.........   00.9245   15.85
    110031.......................   01.2780   19.47   110121..........   01.2134   14.59   120003.........   01.1064   24.14   140010.........   01.3777   23.35   140100.........   01.3042   20.50
    110032.......................   01.3079   15.70   110122..........   01.3699   18.25   120004.........   01.2164   24.55   140011.........   01.1962   16.35   140101.........   01.2281   18.42
    110033.......................   01.4405   21.48   110124..........   01.3180   14.58   120005.........   01.2966   21.62   140012.........   01.2712   18.24   140102.........   01.1167   15.46
    110034.......................   01.6284   18.31   110125..........   01.2718   16.36   120006.........   01.3249   24.64   140013.........   01.5981   16.59   140103.........   01.4637   15.98
    110035.......................   01.4374   23.29   110127..........   00.9214   14.72   120007.........   01.6729   21.82   140014.........   01.2346   18.98   140105.........   01.3523   20.16
    110036.......................   01.7729  .......  110128..........   01.1853   18.34   120009.........   00.9647   19.58   140015.........   01.2859   14.77   140107.........   01.0723   14.19
    110038.......................   01.4872   17.19   110129..........   01.6924   17.61   120010.........   01.8131   23.76   140016.........   00.9826   12.09   140108.........   01.3529   22.83
    110039.......................   01.3748   19.83   110130..........   01.0679   11.85   120011.........   01.3231   32.97   140018.........   01.3572   19.73   140109.........   01.2235   14.65
    110040.......................   01.1392   17.40   110132..........   01.1281   13.98   120012.........   00.8889   21.42   140019.........   01.0877   14.26   140110.........   01.2260   18.89
    110041.......................   01.1919   16.68   110134..........   00.9052   12.22   120014.........   01.3437   23.53   140024.........   00.9826   13.82   140112.........   01.1475   14.27
    110042.......................   01.2326   16.85   110135..........   01.3155   17.76   120015.........   00.8945   23.63   140025.........   01.0844   16.04   140113.........   01.5963   18.16
    110043.......................   01.8013   16.83   110136..........   01.1358   15.43   120016.........   01.0773   26.99   140026.........   01.2533   16.60   140114.........   01.3451   19.18
    110044.......................   01.1835   15.11   110140..........   01.0384   15.81   120018.........   01.0119   22.29   140027.........   01.3199   17.12   140115.........   01.3318   19.21
    110045.......................   01.2010   19.00   110141..........   01.0430   13.17   120019.........   01.2134   20.93   140029.........   01.4133   20.69   140116.........   01.2572   20.69
    110046.......................   01.2702   19.27   110142..........   00.9278   10.94   120021.........   00.8363   19.89   140030.........   01.7236   21.88   140117.........   01.5466   20.39
    110048.......................   01.2958   14.77   110143..........   01.4312   20.93   120022.........   01.6938   17.36   140031.........   01.1981   14.47   140118.........   01.6712   23.20
    110049.......................   01.0595   12.66   110144..........   01.1053   18.09   120026.........   01.2420   24.30   140032.........   01.3088   17.51   140119.........   01.7295   21.17
    110050.......................   01.2663   17.24   110146..........   01.1084   16.74   120027.........   01.4788   22.77   140033.........   01.2949   22.13   140120.........   01.4493   16.54
    110051.......................   01.0328   13.87   110149..........   01.1383   18.93   120028.........   01.2495  .......  140034.........   01.1849   18.25   140121.........   01.4033   14.91
    110052.......................   01.1633   08.57   110150..........   01.3908   18.34   130001.........   00.9237   20.88   140035.........   01.0753   13.77   140122.........   01.5946   22.76
    110054.......................   01.3234   18.80   110152..........   01.0769   15.05   130002.........   01.3874   15.94   140036.........   01.2318   17.01   140124.........   01.2207   25.20
    110056.......................   01.1047   16.02   110153..........   01.0943   18.60   130003.........   01.3296   19.77   140037.........   01.0362   13.33   140125.........   01.3391   16.31
    110059.......................   01.3075   12.05   110154..........   01.0296   13.75   130005.........   01.4326   19.70   140038.........   01.2131   14.65   140127.........   01.4371   18.66
    110061.......................   01.0818   13.87   110155..........   01.1450   14.18   130006.........   01.8387   19.10   140040.........   01.3081   15.90   140128.........   01.0565   16.08
    110062.......................   00.8961   14.52   110156..........   01.0223   15.53   130007.........   01.6496   19.28   140041.........   01.1977   16.33   140129.........   01.1941   16.61
    110063.......................   01.1382   15.19   110161..........   01.3086   20.74   130008.........   00.9899   12.07   140042.........   01.0291   13.94   140130.........   01.2719   24.16
    110064.......................   01.3862   18.18   110162..........   00.8099  .......  130009.........   00.9347   15.62   140043.........   01.1678   17.93   140132.........   01.5121   23.60
    110065.......................   01.0241   12.93   110163..........   01.5208   18.71   130010.........   00.9101   19.08   140045.........   01.0478   15.21   140133.........   01.3440   20.51
    110066.......................   01.4714   20.37   110164..........   01.4277   21.27   130011.........   01.3476   19.35   140046.........   01.3159   15.70   140135.........   01.2990   16.16
    110069.......................   01.2824   18.52   110165..........   01.4010   18.70   130012.........   01.0020   22.02   140047.........   01.1731   16.57   140137.........   01.0428   17.24
    110070.......................   01.1006   17.18   110166..........   01.5150   18.65   130013.........   01.3101   19.25   140048.........   01.3315   21.58   140138.........   01.0982   14.18
    110071.......................   01.1356   11.04   110168..........   01.7223   20.47   130014.........   01.3693   17.03   140049.........   01.5511   20.89   140139.........   01.1145   15.86
    110072.......................   01.0173   12.51   110169..........   01.1931   18.66   130015.........   00.9264   17.50   140051.........   01.5114   19.42   140140.........   01.1906   18.58
    110073.......................   01.2272   14.32   110171..........   01.4942   20.46   130016.........   00.9173   17.25   140052.........   01.3990   17.19   140141.........   01.3059   14.79
    110074.......................   01.4541   17.24   110172..........   01.4235   21.34   130017.........   01.1709   16.55   140053.........   02.0119   18.24   140143.........   01.1514   17.94
    110075.......................   01.3591   16.51   110174..........   00.9675   15.24   130018.........   01.7382   17.35   140054.........   01.3761   22.90   140144.........   01.0424   17.37
    110076.......................   01.5073   20.04   110176..........   02.5217   20.96   130019.........   01.1641   17.99   140055.........   00.9267   13.99   140145.........   01.1604   16.19
    110078.......................   01.7630   21.73   110177..........   01.5788   19.87   130021.........   00.9692   15.30   140058.........   01.2943   16.54   140146.........   01.0612   16.77
    110079.......................   01.3856   19.30   110178..........   02.9393   16.83   130022.........   01.2437   18.53   140059.........   01.2264   15.77   140147.........   01.3933   15.62
    110080.......................   01.2083   18.22   110179..........   01.1105   20.42   130024.........   01.0773   18.00   140061.........   01.1070   14.15   140148.........   01.8210   17.46
    110082.......................   02.1044   21.81   110181..........   00.9493   14.70   130025.........   01.1043   14.20   140062.........   01.2892   26.44   140150.........   01.5671   25.02
    110083.......................   01.7148   20.98   110183..........   01.3855   21.18   130026.........   01.1592   19.63   140063.........   01.4336   22.90   140151.........   01.0723   19.64
    110086.......................   01.2336   13.04   110184..........   01.2704   19.37   130027.........   00.8923   19.57   140064.........   01.3056   17.80   140152.........   01.1727   21.63
    110087.......................   01.3469   20.67   110185..........   01.1237   15.51   130028.........   01.2366   16.83   140065.........   01.5316   24.12   140155.........   01.3024   17.47
    110089.......................   01.2215   17.12   110186..........   01.3551   15.59   130029.........   01.1095   17.62   140066.........   01.2213   15.60   140158.........   01.3851   22.91
    110091.......................   01.3195   19.73   110187..........   01.3406   19.18   130030.........   00.8668   18.40   140067.........   01.7964   17.99   140160.........   01.2137   16.52
    110092.......................   01.1612   15.18   110188..........   01.3408   18.49   130031.........   00.9616   16.44   140068.........   01.2411   18.98   140161.........   01.2198   18.07
    110093.......................   00.9463   11.69   110189..........   01.1257   17.51   130034.........   01.0096   19.35   140069.........   01.0622   16.04   140162.........   01.7869   17.93
    110094.......................   01.0827   14.08   110190..........   01.0981   15.41   130035.........   01.0090   19.47   140070.........   01.2423   17.31   140164.........   01.4470   20.29
    110095.......................   01.3819   14.69   110191..........   01.3627   17.96   130036.........   01.3025   13.66   140074.........   01.0465   17.25   140165.........   01.1078   13.70
    110096.......................   01.1427   14.85   110192..........   01.4687   21.41   130037.........   01.2910   16.97   140075.........   01.4117   14.13   140166.........   01.3247   17.54
    110097.......................   01.0561   14.44   110193..........   01.2426   17.89   130043.........   00.9508   15.79   140077.........   01.2351   16.89   140167.........   01.1271   15.06
    110098.......................   00.9804   15.28   110194..........   00.9257   14.21   130044.........   01.1952   10.50   140079.........   01.2417   17.22   140168.........   01.1771   16.36
    110100.......................   01.0482   16.39   110195..........   01.1159   13.34   130045.........   00.9956   15.28   140080.........   01.6294   20.58   140170.........   01.0929   13.81
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25626]]
    
    
                                                                                              Page 5 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    140171.......................   00.9828   12.95   140300..........   01.5868   23.72   150074.........   01.6442   19.08   160030.........   01.3920   18.00   160109.........   01.0993   14.76
    140172.......................   01.6579   18.91   150001..........   01.1146   19.10   150075.........   01.1491   15.63   160031.........   01.1010   14.50   160110.........   01.5914   15.04
    140173.......................   00.9180   16.52   150002..........   01.5657   18.51   150076.........   01.1723   21.36   160032.........   01.1307   16.27   160111.........   01.0133   12.29
    140174.......................   01.5914   20.01   150003..........   01.6957   19.07   150077.........   01.1446   17.40   160033.........   01.8232   17.57   160112.........   01.4106   16.06
    140176.......................   01.2364   19.89   150004..........   01.5034   19.60   150078.........   01.0704   17.34   160034.........   01.1382   15.15   160113.........   01.0099   13.35
    140177.......................   01.3461   17.27   150005..........   01.1843   18.97   150079.........   01.2096   15.90   160035.........   01.0002   16.77   160114.........   01.0199   15.40
    140179.......................   01.3420   20.09   150006..........   01.2849   18.75   150082.........   01.5715   18.22   160036.........   00.9948   19.22   160115.........   01.0123   15.21
    140180.......................   01.4432   20.79   150007..........   01.2112   23.06   150084.........   01.9333   21.85   160037.........   01.0667   17.12   160116.........   01.1438   16.05
    140181.......................   01.4074   19.27   150008..........   01.4533   20.34   150086.........   01.3607   16.73   160039.........   01.0325   17.49   160117.........   01.4481   16.57
    140182.......................   01.4406   15.18   150009..........   01.3592   17.29   150088.........   01.3868   18.67   160040.........   01.3654   17.43   160118.........   01.0367   15.14
    140184.......................   01.2681   15.18   150010..........   01.3797   16.85   150089.........   01.4239   19.56   160041.........   01.1128   14.40   160120.........   01.0155   11.33
    140185.......................   01.5341   17.64   150011..........   01.2435   18.61   150090.........   01.2347   18.94   160043.........   01.0103   14.43   160122.........   01.0901   18.27
    140186.......................   01.3891   20.30   150012..........   01.6411   21.50   150091.........   01.0113   16.53   160044.........   01.2318   15.75   160124.........   01.2824   16.47
    140187.......................   01.4964   16.84   150013..........   01.1763   15.74   150092.........   01.0684   14.87   160045.........   01.7278   18.63   160126.........   01.0538   15.68
    140188.......................   00.9537   13.20   150014..........   01.5052   18.35   150094.........   00.9903   17.59   160046.........   00.9983   11.21   160129.........   01.0655   15.03
    140189.......................   01.1992   17.72   150015..........   01.2408   20.85   150095.........   01.0953   18.41   160047.........   01.3985   16.53   160130.........   01.2040   14.80
    140190.......................   01.1009   16.47   150017..........   01.8553   19.45   150096.........   01.0629   17.95   160048.........   01.0493   13.27   160131.........   01.0625   14.49
    140191.......................   01.4397   22.26   150018..........   01.3501   18.66   150097.........   01.1098   17.18   160049.........   00.9436   12.67   160134.........   00.9376   12.70
    140193.......................   01.1059   14.46   150019..........   01.1845   14.94   150098.........   01.1241   16.63   160050.........   01.0811   15.90   160135.........   01.0142   15.11
    140197.......................   01.2541   16.79   150020..........   01.1512   13.22   150099.........   01.2843   17.66   160051.........   00.9312   13.79   160138.........   01.0655   14.59
    140199.......................   01.1100   17.14   150021..........   01.6165   18.36   150100.........   01.6568   17.51   160052.........   01.0078   14.41   160140.........   01.1400   16.69
    140200.......................   01.4621   21.75   150022..........   01.1136   17.58   150101.........   01.1211   19.95   160054.........   01.0121   13.35   160142.........   01.1009   15.31
    140202.......................   01.3111   21.58   150023..........   01.6061   19.97   150102.........   01.1598   12.14   160055.........   00.9931   13.61   160143.........   00.9819   15.10
    140203.......................   01.1647   22.19   150024..........   01.3888   18.92   150103.........   00.9512   19.44   160056.........   01.1741   14.54   160145.........   01.1407   14.85
    140205.......................   00.9675   15.10   150025..........   01.4888   17.26   150104.........   01.0823   16.22   160057.........   01.3770   17.28   160146.........   01.4416   16.29
    140206.......................   01.2352   20.80   150026..........   01.2078   18.81   150105.........   01.3386   17.27   160058.........   01.7722   19.62   160147.........   01.3353   17.49
    140207.......................   01.3748   20.67   150027..........   01.0411   17.50   150106.........   01.0981   15.15   160060.........   01.1076   15.15   160151.........   01.1079   16.09
    140208.......................   01.6884   24.61   150029..........   01.3890   20.73   150109.........   01.4355   18.03   160061.........   01.1171   16.03   160152.........   01.0039   14.39
    140209.......................   01.6540   14.76   150030..........   01.2567   17.00   150110.........   01.0392   15.28   160062.........   00.9454   15.66   160153.........   01.8054   18.68
    140210.......................   01.0799   14.99   150031..........   01.0946   15.03   150111.........   01.1656   15.08   160063.........   01.1546   16.85   170001.........   01.1951   16.74
    140211.......................   01.2061   19.50   150032..........   01.8612   19.41   150112.........   01.3267   18.92   160064.........   01.6269   18.72   170004.........   01.0677   13.57
    140213.......................   01.3176   21.25   150033..........   01.5986   21.73   150113.........   01.2282   18.52   160065.........   01.0220   16.04   170006.........   01.1576   15.84
    140215.......................   01.0859   14.05   150034..........   01.4872   21.18   150114.........   01.0692   17.02   160066.........   01.1481   15.76   170008.........   00.9797   13.42
    140217.......................   01.3129   22.52   150035..........   01.5616   19.66   150115.........   01.3601   17.18   160067.........   01.4072   17.52   170009.........   01.2006   17.07
    140218.......................   01.0528   15.20   150036..........   01.0369   18.92   150122.........   01.1376   18.53   160068.........   01.0212   15.43   170010.........   01.3037   16.52
    140220.......................   01.1009   17.26   150037..........   01.2481   18.31   150123.........   01.0540   14.07   160069.........   01.4919   17.39   170012.........   01.4254   15.95
    140223.......................   01.6061   23.21   150038..........   01.4463   18.74   150124.........   01.1303   15.08   160070.........   00.9590   14.55   170013.........   01.3060   16.49
    140224.......................   01.3499   22.21   150039..........   00.9739   16.62   150125.........   01.4487   19.02   160072.........   01.0768   14.19   170014.........   01.0310   17.45
    140228.......................   01.6505   17.83   150042..........   01.2851   16.54   150126.........   01.4679   20.96   160073.........   00.9704   13.66   170015.........   00.9909   15.23
    140230.......................   00.9336   15.97   150043..........   01.0389   16.96   150127.........   01.0314   15.89   160074.........   01.0474   15.71   170016.........   01.6836   22.29
    140231.......................   01.5659   21.90   150044..........   01.2351   18.03   150128.........   01.2813   18.07   160075.........   01.1806   15.77   170017.........   01.2077   18.08
    140233.......................   01.8328   18.16   150045..........   01.1303   16.21   150129.........   01.1222   24.48   160076.........   01.0409   17.07   170018.........   01.1380   14.10
    140234.......................   01.2359   17.76   150046..........   01.4926   16.66   150130.........   01.3484   16.53   160077.........   01.0730   11.38   170019.........   01.2203   16.42
    140236.......................   01.0046   14.29   150047..........   01.6176   19.11   150132.........   01.4914   18.89   160079.........   01.4250   17.85   170020.........   01.2910   15.58
    140239.......................   01.7410   18.31   150048..........   01.2267   18.58   150133.........   01.1644   17.44   160080.........   01.2026   17.07   170022.........   01.1333   16.84
    140240.......................   01.4331   22.78   150049..........   01.1415   15.37   150134.........   01.1629   17.56   160081.........   01.0971   15.21   170023.........   01.3998   17.38
    140242.......................   01.6616   22.15   150050..........   01.2343   16.20   150136.........   00.8607   20.95   160082.........   01.9400   17.26   170024.........   01.1587   13.03
    140245.......................   01.2200   15.19   150051..........   01.4673   18.63   150145.........   03.7024  .......  160083.........   01.6760   17.94   170025.........   01.1942   16.10
    140246.......................   01.1107   12.78   150052..........   01.1526   14.50   160001.........   01.2869   18.91   160085.........   00.9877   15.41   170026.........   01.1060   13.45
    140250.......................   01.3085   23.24   150053..........   01.0122   18.92   160002.........   01.1579   14.48   160086.........   00.9510   15.78   170027.........   01.3149   15.96
    140251.......................   01.3487   20.32   150054..........   01.0954   15.80   160003.........   01.0272   14.39   160088.........   01.1853   16.87   170030.........   01.0487   12.94
    140252.......................   01.4849   23.55   150056..........   01.8319   23.14   160005.........   01.0962   15.72   160089.........   01.2264   16.16   170031.........   00.8797   12.80
    140253.......................   01.3970   14.08   150057..........   02.3139   18.25   160007.........   01.0149   13.81   160090.........   01.0121   15.53   170032.........   01.0645   15.46
    140258.......................   01.5859   22.07   150058..........   01.7734   20.30   160008.........   01.1611   14.74   160091.........   01.0690   12.74   170033.........   01.3680   15.54
    140271.......................   01.0367   14.78   150059..........   01.3588   21.47   160009.........   01.2225   15.87   160092.........   01.0710   15.37   170034.........   01.0172   13.85
    140275.......................   01.2393   16.99   150060..........   01.1408   14.72   160012.........   01.0015   15.93   160093.........   01.0603   15.71   170035.........   00.8913   14.00
    140276.......................   02.0402   21.39   150061..........   01.2235   15.33   160013.........   01.2088   16.74   160094.........   01.1200   15.60   170036.........   00.9101   14.08
    140280.......................   01.3633   17.80   150062..........   01.1228   17.69   160014.........   00.9551   14.41   160095.........   01.0625   14.27   170037.........   01.0368   16.58
    140281.......................   01.6894   22.14   150063..........   01.0545   16.90   160016.........   01.2452   17.25   160097.........   01.0952   14.59   170038.........   00.9220   12.68
    140285.......................   01.2529   26.86   150064..........   01.2804   16.17   160018.........   00.9374   13.77   160098.........   01.0002   15.05   170039.........   01.0941   14.19
    140286.......................   01.1496   18.53   150065..........   01.2062   18.66   160020.........   01.0918   13.84   160099.........   00.9166   12.91   170040.........   01.6491   19.98
    140288.......................   01.7475   22.93   150066..........   01.0055   17.04   160021.........   01.0569   15.16   160101.........   01.0582   17.55   170041.........   01.0778   11.22
    140289.......................   01.3491   16.32   150067..........   01.1690   16.20   160023.........   01.0267   14.75   160102.........   01.4133   16.83   170044.........   00.9909   13.97
    140290.......................   01.3868   20.06   150069..........   01.2637   17.75   160024.........   01.5208   18.26   160103.........   01.0464   16.71   170045.........   01.0394   15.99
    140291.......................   01.3999   23.45   150070..........   01.0571   17.16   160026.........   01.0784   17.30   160104.........   01.2767   17.17   170049.........   01.2914   18.45
    140292.......................   01.1440   20.62   150071..........   01.1147   14.38   160027.........   01.1359   15.04   160106.........   01.0226   15.39   170051.........   00.9111   13.41
    140294.......................   01.1807   18.17   150072..........   01.2157   16.13   160028.........   01.2457   29.74   160107.........   01.1907   16.26   170052.........   01.1183   14.31
    140297.......................   03.6153   42.09   150073..........   01.0490   20.53   160029.........   01.5683   20.19   160108.........   01.1241   15.98   170053.........   00.9906   13.83
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25627]]
    
    
                                                                                              Page 6 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    170054.......................   01.0978   13.64   170150..........   01.1546   14.00   180067.........   01.9594   17.80   190034.........   01.1818   15.36   190155.........   00.7261   16.10
    170055.......................   01.0862   14.51   170151..........   00.9807   12.49   180069.........   01.1523   17.35   190035.........   01.4071  .......  190156.........   01.0217   12.27
    170056.......................   00.8958   14.93   170152..........   01.0368   14.21   180070.........   01.1536   13.55   190036.........   01.6970   20.46   190158.........   01.1942   20.62
    170057.......................   00.9835   12.90   170160..........   01.0025   11.81   180072.........   01.1750   15.81   190037.........   00.9050   11.28   190160.........   01.2638   17.06
    170058.......................   01.1567   17.07   170164..........   01.0153   15.00   180075.........   01.6587   12.66   190039.........   01.4112   16.98   190161.........   01.0650   14.05
    170060.......................   01.1064   14.95   170166..........   01.1487   17.40   180078.........   01.0858   18.97   190040.........   01.3258   20.34   190162.........   01.0985   19.57
    170061.......................   01.1697   14.15   170171..........   01.0693   12.88   180079.........   01.2462   12.71   190041.........   01.5988   19.98   190164.........   01.2766   14.89
    170063.......................   00.8588   11.84   170175..........   01.3959   17.67   180080.........   01.0624   15.09   190043.........   01.0674   12.52   190167.........   01.1707   18.78
    170066.......................   01.0038   13.66   170176..........   01.6751   23.94   180087.........   01.3024   14.29   190044.........   01.1587   21.11   190170.........   00.9093   13.69
    170067.......................   01.0353   14.44   170182..........   01.4638   21.54   180088.........   01.5749   21.13   190045.........   01.4309   21.34   190173.........   01.4304   19.33
    170068.......................   01.2562   17.01   170183..........   02.0468   15.05   180092.........   01.2237   15.98   190046.........   01.4383   18.69   190175.........   01.6161   20.46
    170070.......................   01.0330   12.73   170184..........   01.7569  .......  180093.........   01.3704   16.69   190048.........   01.2557   15.02   190176.........   01.6907   20.76
    170073.......................   01.1796   15.56   180001..........   01.3958   17.78   180094.........   01.0627   12.86   190049.........   00.9841   15.98   190177.........   01.7756   18.85
    170074.......................   01.1210   13.48   180002..........   01.1271   17.71   180095.........   01.1988   13.96   190050.........   01.0974   14.68   190178.........   00.9828   10.60
    170075.......................   00.9167   10.71   180004..........   01.1260   15.79   180099.........   01.2011   12.83   190053.........   01.1305   12.51   190182.........   01.2638   19.89
    170076.......................   01.0539   12.59   180005..........   01.2488   18.80   180101.........   01.2773   16.26   190054.........   01.3434   16.77   190183.........   01.1934   15.22
    170077.......................   00.9613   12.55   180006..........   00.9249   12.49   180102.........   01.4712   18.17   190059.........   00.8927   14.11   190184.........   01.0340   15.61
    170079.......................   00.9525   12.75   180007..........   01.4823   16.55   180103.........   02.2948   18.25   190060.........   01.4334   14.94   190185.........   01.3460   19.22
    170080.......................   00.9784   12.95   180009..........   01.4022   20.11   180104.........   01.5599   16.85   190064.........   01.5728   22.67   190186.........   00.9219   14.11
    170081.......................   00.9351   11.91   180010..........   01.9106   18.13   180105.........   00.9458   15.32   190065.........   01.4938   18.08   190190.........   00.8904   12.48
    170082.......................   00.9822   12.06   180011..........   01.3471   18.96   180106.........   00.8758   13.13   190071.........   00.9048   12.68   190191.........   01.2236   19.55
    170084.......................   00.9112   29.87   180012..........   01.4127   18.41   180108.........   00.8320   13.64   190077.........   00.9403   13.95   190196.........   00.9611   16.22
    170085.......................   00.9055   12.47   180013..........   01.4174   17.18   180115.........   01.0027   16.43   190078.........   01.1522   12.81   190197.........   01.1855   17.51
    170086.......................   01.7294   18.97   180014..........   01.7276   18.00   180116.........   01.3502   16.15   190079.........   01.3216   17.02   190199.........   01.2599   10.95
    170088.......................   00.9532   10.70   180016..........   01.3059   14.83   180117.........   01.1374   17.24   190081.........   00.9314   13.70   190200.........   01.5884   20.17
    170089.......................   00.9736   12.13   180017..........   01.3626   14.79   180118.........   01.0477   11.54   190083.........   01.1019   16.51   190201.........   01.0893   18.83
    170090.......................   00.9993   11.36   180018..........   01.3348   15.32   180120.........   01.0374   16.25   190086.........   01.3466   15.04   190202.........   01.2511   18.81
    170092.......................   00.8320   12.01   180019..........   01.2531   16.76   180121.........   01.3111   14.05   190088.........   01.3395   19.01   190203.........   01.5559   22.35
    170093.......................   00.9126   12.94   180020..........   01.1266   16.86   180122.........   01.1060   15.93   190089.........   01.0953   12.63   190204.........   01.4971   20.42
    170094.......................   00.9330   16.97   180021..........   01.0695   14.26   180123.........   01.4019   18.92   190090.........   01.1136   16.03   190205.........   01.9390   18.91
    170095.......................   01.1284   13.41   180023..........   00.9119   14.80   180124.........   01.4305   16.87   190092.........   01.4163   21.19   190206.........   01.6020   21.26
    170097.......................   00.9893   14.02   180024..........   01.4455   15.89   180125.........   01.1083   17.87   190095.........   01.0410   15.00   190207.........   01.2223   17.10
    170098.......................   01.1633   14.54   180025..........   01.1748   16.40   180126.........   01.2108   11.42   190098.........   01.4884   19.10   190208.........   00.8302   10.93
    170099.......................   01.2147   12.86   180026..........   01.2509   13.57   180127.........   01.3576   16.72   190099.........   01.2333   17.67   190218.........   01.1701   17.36
    170100.......................   01.0623   13.73   180027..........   01.3139   15.23   180128.........   01.1777   16.18   190102.........   01.5818   18.10   190227.........   00.8692   30.27
    170101.......................   00.9176   13.46   180028..........   01.0814   17.78   180129.........   01.0392   15.30   190103.........   00.8978   11.00   190231.........   01.4412   13.27
    170102.......................   01.0142   12.99   180029..........   01.3033   16.86   180130.........   01.4202   17.56   190106.........   01.1713   17.85   190235.........   01.6524  ......
    170103.......................   01.2839   15.92   180030..........   01.1614   16.38   180132.........   01.2846   16.14   190109.........   01.2506   14.31   190236.........   01.4037  ......
    170104.......................   01.4518   20.25   180031..........   01.1179   14.02   180133.........   01.3195   22.68   190110.........   00.9671   13.76   200001.........   01.4021   16.84
    170105.......................   01.0732   15.22   180032..........   01.0939   16.97   180134.........   01.0985   14.44   190111.........   01.5353   19.83   200002.........   01.1101   23.41
    170106.......................   00.9680   10.48   180033..........   01.1805   16.08   180136.........   01.6663   19.72   190112.........   01.6582   20.08   200003.........   01.1421   16.08
    170109.......................   00.9935   16.20   180034..........   01.1401   15.45   180138.........   01.2692   17.70   190113.........   01.3372   19.82   200006.........   01.0161   18.67
    170110.......................   01.0011   15.05   180035..........   01.6042   19.58   180139.........   01.1175   17.89   190114.........   01.0360   13.12   200007.........   01.0238   16.64
    170112.......................   01.0327   13.55   180036..........   01.2081   18.69   180140.........   01.0543   22.60   190115.........   01.2011   19.30   200008.........   01.2487   20.05
    170113.......................   01.0910   15.23   180037..........   01.3315   19.96   180141.........   01.7850  .......  190116.........   01.1612   15.43   200009.........   01.8248   20.28
    170114.......................   01.0309   14.05   180038..........   01.4356   15.84   190001.........   00.9574   22.06   190118.........   01.0653   13.08   200012.........   01.1253   16.83
    170115.......................   00.9963   12.43   180040..........   01.9798   18.75   190002.........   01.7233   18.29   190120.........   01.0389   13.99   200013.........   01.1175   15.39
    170116.......................   01.0782   15.42   180041..........   01.1067   14.94   190003.........   01.4208   18.68   190122.........   01.3127   13.83   200015.........   01.2672   17.80
    170117.......................   00.9897   13.41   180042..........   01.1356   15.00   190004.........   01.4619   16.87   190124.........   01.6393   19.92   200016.........   01.0377   16.48
    170119.......................   00.9907   13.57   180043..........   01.1907   19.10   190005.........   01.5814   16.64   190125.........   01.5379   18.47   200018.........   01.2179   16.45
    170120.......................   01.3100   12.93   180044..........   01.2212   17.26   190006.........   01.3309   15.31   190128.........   01.1054   18.95   200019.........   01.2635   18.12
    170122.......................   01.7443   18.82   180045..........   01.3799   17.34   190007.........   01.0296   14.17   190130.........   00.9720   12.14   200020.........   01.1295   19.42
    170123.......................   01.7876   18.98   180046..........   01.1868   16.65   190008.........   01.6750   19.37   190131.........   01.2328   17.54   200021.........   01.1599   18.52
    170124.......................   00.9925   13.55   180047..........   01.0316   14.66   190009.........   01.3215   14.70   190133.........   00.9626   12.86   200023.........   00.9037   14.08
    170126.......................   00.9618   12.53   180048..........   01.2731   16.28   190010.........   01.1133   16.24   190134.........   01.0045   16.50   200024.........   01.4120   19.55
    170128.......................   00.9122   14.70   180049..........   01.3932   16.09   190011.........   01.1696   15.32   190135.........   01.4522   20.69   200025.........   01.1595   19.60
    170131.......................   01.1686   12.10   180050..........   01.2650   17.25   190013.........   01.3473   16.26   190136.........   01.2074   11.11   200026.........   01.0448   15.97
    170133.......................   01.1015   16.69   180051..........   01.3715   15.43   190014.........   01.1457   16.03   190138.........   00.8637   20.29   200027.........   01.2326   16.90
    170134.......................   00.9044   13.04   180053..........   01.1052   14.96   190015.........   01.2583   18.74   190140.........   00.9874   11.98   200028.........   00.9883   16.14
    170137.......................   01.1656   17.98   180054..........   01.1345   15.82   190017.........   01.3983   14.84   190142.........   00.9321   14.53   200031.........   01.2524   15.04
    170139.......................   01.0729   12.91   180055..........   01.2319   14.70   190018.........   01.1580   17.48   190144.........   01.2665   16.26   200032.........   01.2974   17.40
    170142.......................   01.2852   17.02   180056..........   01.1288   16.33   190019.........   01.7296   19.64   190145.........   01.0068   14.74   200033.........   01.7963  ......
    170143.......................   01.1875   15.24   180058..........   01.0463   13.04   190020.........   01.1693   17.77   190146.........   01.6123   21.10   200034.........   01.2207   18.06
    170144.......................   01.6583   13.79   180059..........   00.8671   15.28   190025.........   01.3335   13.33   190147.........   00.9695   14.36   200037.........   01.2183   16.94
    170145.......................   01.1081   14.18   180063..........   01.1789   11.94   190026.........   01.5020   18.00   190148.........   00.9710   13.91   200038.........   01.1302   19.07
    170146.......................   01.5294   18.68   180064..........   01.3252   14.68   190027.........   01.5422   17.46   190149.........   01.0118   14.40   200039.........   01.2896   19.74
    170147.......................   01.2024   18.98   180065..........   01.0035   12.89   190029.........   01.1748   17.67   190151.........   01.2151   12.80   200040.........   01.1290   19.05
    170148.......................   01.4951   17.89   180066..........   01.1563   18.08   190033.........   00.9756   10.02   190152.........   01.4896   20.71   200041.........   01.1543   18.64
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25628]]
    
    
                                                                                              Page 7 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    200043.......................   00.7365   18.37   220017..........   01.3977   14.12   220153.........   01.0232   22.56   230100.........   01.1670   15.57   230213.........   00.9993   15.25
    200050.......................   01.1575   17.35   220019..........   01.1645   19.12   220154.........   00.9445   22.42   230101.........   01.1095   18.36   230216.........   01.5651   17.80
    200051.......................   01.0114   19.57   220020..........   01.2268   19.47   220162.........   01.2697  .......  230103.........   01.0400   20.72   230217.........   01.2521   22.94
    200052.......................   01.0406   15.56   220023..........   00.6107   19.30   220163.........   02.1199   24.87   230104.........   01.5911   22.43   230219.........   00.8768   19.28
    200055.......................   01.1614   17.37   220024..........   01.2158   21.22   220171.........   01.6207   22.92   230105.........   01.7568   20.27   230221.........   00.8720   24.54
    200062.......................   00.9472   15.91   220025..........   01.1292   18.70   230001.........   01.1902   18.07   230106.........   01.3003   20.51   230222.........   01.4495   19.43
    200063.......................   01.3059   18.34   220028..........   01.4722   21.01   230002.........   01.2759   20.69   230107.........   00.9076   14.72   230223.........   01.3326   21.85
    200066.......................   01.1622   16.74   220029..........   01.1851   24.16   230003.........   01.1581   18.62   230108.........   01.2121   18.37   230227.........   01.4724   21.56
    210001.......................   01.4925   21.16   220030..........   01.1533   15.00   230004.........   01.7098   22.86   230110.........   01.3576   17.83   230230.........   01.6794   22.01
    210002.......................   01.9930   18.07   220031..........   01.9215  .......  230005.........   01.2844   18.86   230113.........   00.9199   20.15   230232.........   00.9510   17.15
    210003.......................   01.6014   21.93   220033..........   01.2840   20.97   230006.........   01.1008   18.53   230115.........   01.0388   17.19   230235.........   01.0957   16.27
    210004.......................   01.3657   23.18   220035..........   01.2837   24.51   230007.........   00.9571   18.95   230116.........   00.9248   16.31   230236.........   01.3249   21.58
    210005.......................   01.2762   19.38   220036..........   01.5965   21.66   230012.........   00.8563   12.18   230117.........   01.8993   26.08   230239.........   01.1389   13.72
    210006.......................   01.1400   17.16   220038..........   01.2959   26.32   230013.........   01.4022   21.05   230118.........   01.2189   17.43   230241.........   01.1643   17.52
    210007.......................   01.7371   25.17   220041..........   01.2273   23.41   230015.........   01.2010   20.91   230119.........   01.2966   21.44   230244.........   01.3959   21.17
    210008.......................   01.3938   19.26   220042..........   01.2464   24.13   230017.........   01.5028   28.89   230120.........   01.1514   18.40   230253.........   00.9911   18.85
    210009.......................   01.8131   21.72   220046..........   01.3702   23.14   230019.........   01.4696   22.20   230121.........   01.2299   20.61   230254.........   01.2624   21.20
    210010.......................   01.1495   15.64   220049..........   01.3541   18.47   230020.........   01.7404   21.30   230122.........   01.3428   19.37   230257.........   00.7824   18.51
    210011.......................   01.3419   19.67   220050..........   01.1242   19.98   230021.........   01.5653   18.27   230124.........   01.1625   18.52   230259.........   01.1882   21.59
    210012.......................   01.6374   22.07   220051..........   01.2183   21.10   230022.........   01.2543   18.76   230128.........   01.3957   22.70   230264.........   01.6939   14.86
    210013.......................   01.3219   19.82   220052..........   01.3247   24.59   230024.........   01.4460   22.98   230130.........   01.6687   22.34   230269.........   01.3782   22.69
    210015.......................   01.2992   19.60   220053..........   01.2325   20.02   230027.........   01.1127   17.48   230132.........   01.3690   24.82   230270.........   01.1731   20.20
    210016.......................   01.8243   22.33   220055..........   01.2994   13.69   230029.........   01.5562   19.51   230133.........   01.2687   17.99   230273.........   01.4465   22.29
    210017.......................   01.2218   15.90   220057..........   01.4056   22.67   230030.........   01.3295   16.78   230135.........   01.3180   23.03   230275.........   00.5262   19.58
    210018.......................   01.3056   21.29   220058..........   01.1529   18.51   230031.........   01.4311   19.42   230137.........   01.1560   18.31   230276.........   00.6644   21.40
    210019.......................   01.5805   18.39   220060..........   01.2952   25.42   230032.........   01.7502   19.80   230141.........   01.6323   22.96   230277.........   01.2430   23.05
    210022.......................   01.5039   21.14   220062..........   00.5762   19.65   230034.........   01.2739   18.80   230142.........   01.3057   19.01   230278.........   01.4214   17.82
    210023.......................   01.3373   21.51   220063..........   01.2663   19.84   230035.........   01.0906   20.47   230143.........   01.3112   18.35   230279.........   00.6584   15.95
    210024.......................   01.5453   20.11   220064..........   01.2830   21.51   230036.........   01.2229   20.75   230144.........   01.1462   20.61   230280.........   00.9997   12.33
    210025.......................   01.3740   18.95   220065..........   01.2956   19.95   230037.........   01.1368   17.66   230145.........   01.1934   18.05   240001.........   01.5448   22.78
    210026.......................   01.3830   17.97   220066..........   01.3789   21.73   230038.........   01.6671   21.58   230146.........   01.2748   19.36   240002.........   01.7516   20.94
    210027.......................   01.2945   17.66   220067..........   01.3230   22.81   230040.........   01.1819   20.58   230147.........   01.3954   17.47   240004.........   01.5826   21.10
    210028.......................   01.2229   18.31   220070..........   01.2219   19.89   230041.........   01.2518   19.27   230149.........   01.1505   16.14   240005.........   00.9321   17.38
    210029.......................   01.2710   14.51   220071..........   01.9036   24.06   230042.........   01.2328   20.08   230151.........   01.4024   21.20   240006.........   01.1358   20.97
    210030.......................   01.1576   19.24   220073..........   01.3068   25.94   230046.........   01.9346   23.28   230153.........   01.1458   16.66   240007.........   01.0656   15.50
    210031.......................   01.2844   16.76   220074..........   01.4397   28.44   230047.........   01.3796   19.17   230154.........   00.9500   14.32   240008.........   01.1157   19.71
    210032.......................   01.1792   18.71   220075..........   01.4818   20.18   230053.........   01.6002   24.58   230155.........   01.0478   17.35   240009.........   00.9226   14.31
    210033.......................   01.2737   18.96   220076..........   01.1822  .......  230054.........   01.8075   19.80   230156.........   01.7144   23.80   240010.........   01.9880   24.41
    210034.......................   01.3510   20.17   220077..........   01.7973   24.84   230055.........   01.1704   19.01   230157.........   01.2003   22.20   240011.........   01.1532   17.81
    210035.......................   01.2976   19.08   220079..........   01.1889   21.38   230056.........   00.9664   15.57   230159.........   01.3458   17.84   240013.........   01.3350   18.17
    210037.......................   01.2736   18.27   220080..........   01.3076   19.50   230058.........   01.0994   18.45   230162.........   01.0605   19.93   240014.........   01.0774   20.29
    210038.......................   01.4108   21.78   220081..........   01.0949   26.78   230059.........   01.5035   19.06   230165.........   01.8769   22.77   240016.........   01.3927   18.22
    210039.......................   01.1817   19.69   220082..........   01.2893   19.76   230060.........   01.2247   18.53   230167.........   01.7979   19.39   240017.........   01.0659   17.25
    210040.......................   01.2977   23.05   220083..........   01.1675   21.76   230062.........   00.9643   15.71   230169.........   01.3453   23.25   240018.........   01.2884   17.23
    210043.......................   01.3140   21.29   220084..........   01.3389   26.31   230063.........   01.3202   19.89   230171.........   01.0161   14.41   240019.........   01.2645   21.39
    210044.......................   01.3429   21.63   220086..........   01.7743  .......  230065.........   01.3020   20.37   230172.........   01.1855   19.10   240020.........   01.1651   20.04
    210045.......................   01.0234   11.01   220088..........   01.6385   23.68   230066.........   01.3702   21.26   230174.........   01.3641   20.84   240021.........   01.0408   16.96
    210048.......................   01.2485   22.46   220089..........   01.2541   21.52   230069.........   01.1366   22.24   230175.........   03.7062  .......  240022.........   01.1137   19.13
    210049.......................   01.1655   17.20   220090..........   01.2774   21.06   230070.........   01.6318   20.99   230176.........   01.2172   22.12   240023.........   00.9935   19.88
    210051.......................   01.4205   22.78   220092..........   01.2563   29.72   230071.........   01.1883   22.62   230178.........   01.0025   17.48   240025.........   01.1418   16.29
    210054.......................   01.3626   21.94   220094..........   01.4476   18.10   230072.........   01.2717   19.89   230180.........   01.1699   14.55   240027.........   01.0297   16.33
    210055.......................   01.2721   22.10   220095..........   01.2243   18.87   230075.........   01.4810   20.07   230184.........   01.1598   18.23   240028.........   01.1529   18.52
    210056.......................   01.3993   17.67   220098..........   01.3462   17.39   230076.........   01.3291   22.97   230186.........   01.2450   15.20   240029.........   01.1603   18.10
    210057.......................   01.4721   24.67   220100..........   01.2697   25.09   230077.........   01.9370   19.36   230188.........   01.1176   15.81   240030.........   01.2834   17.99
    210058.......................   01.4828   18.67   220101..........   01.4781   24.24   230078.........   01.2553   16.56   230189.........   00.9585   15.39   240031.........   00.9756   16.71
    210059.......................   01.2611   21.98   220104..........   01.4373   23.69   230080.........   01.2411   19.94   230190.........   01.0724   24.98   240036.........   01.5650   20.26
    210060.......................   01.2540  .......  220105..........   01.3499   20.60   230081.........   01.2578   16.66   230191.........   00.9623   17.58   240037.........   01.0233   18.19
    210061.......................   01.1774   18.56   220106..........   01.2300   23.09   230082.........   01.1162   17.08   230193.........   01.2584   17.77   240038.........   01.4973   24.56
    220001.......................   01.2775   27.10   220108..........   01.1989   22.28   230085.........   01.0922   18.91   230195.........   01.3347   21.46   240040.........   01.2454   20.15
    220002.......................   01.5400   18.62   220110..........   02.0189   29.18   230086.........   00.9486   17.36   230197.........   01.4218   21.17   240041.........   01.1644   17.48
    220003.......................   01.1363   17.49   220111..........   01.2643   21.79   230087.........   01.0889   16.19   230199.........   01.1115   19.29   240043.........   01.1966   17.00
    220006.......................   01.4328   20.39   220116..........   01.9394  .......  230089.........   01.2754   23.86   230201.........   01.1456   15.09   240044.........   01.1842   18.04
    220008.......................   01.2873   21.58   220119..........   01.3311   23.69   230092.........   01.3562   19.28   230204.........   01.4307   21.66   240045.........   01.0477   21.34
    220010.......................   01.3417   21.70   220123..........   01.0577   23.94   230093.........   01.2768   19.05   230205.........   01.0377   16.37   240047.........   01.5436   21.26
    220011.......................   01.1581   28.81   220126..........   01.3572   19.87   230095.........   01.1791   17.06   230207.........   01.2683   19.90   240048.........   01.2443   22.64
    220012.......................   01.3404   35.18   220128..........   00.8929   21.18   230096.........   01.0974   24.02   230208.........   01.3205   17.76   240049.........   01.7730   22.43
    220015.......................   01.1918   22.77   220133..........   00.9081   27.36   230097.........   01.6121   19.12   230211.........   00.9047   21.59   240050.........   01.1639   24.71
    220016.......................   01.3686   21.58   220135..........   01.3076   26.10   230099.........   01.1463   19.68   230212.........   01.0827   23.46   240051.........   01.0123   18.49
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25629]]
    
    
                                                                                              Page 8 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    240052.......................   01.3097   18.64   240139..........   00.9667   16.59   250042.........   01.2795   15.45   260003.........   01.1304   13.48   260105.........   01.8950   20.26
    240053.......................   01.5210   20.25   240141..........   01.1702   21.09   250043.........   00.9854   12.25   260004.........   01.0516   13.31   260107.........   01.4575   19.81
    240056.......................   01.2479   21.74   240142..........   01.1458   19.27   250044.........   01.0267   15.41   260005.........   01.6188   20.26   260108.........   01.8607   21.29
    240057.......................   01.8120   22.68   240143..........   00.9530   13.94   250045.........   01.2004   18.75   260006.........   01.5009   20.55   260109.........   00.9884   12.92
    240058.......................   00.9732   14.79   240144..........   01.0302   16.74   250047.........   00.9728   15.45   260008.........   01.3629   16.53   260110.........   01.6869   15.15
    240059.......................   01.0983   21.81   240145..........   01.0332   15.57   250048.........   01.5487   15.26   260009.........   01.2581   16.29   260113.........   01.1477   14.76
    240061.......................   01.8085   24.36   240146..........   00.9306   19.10   250049.........   00.8905   11.34   260011.........   01.6980   18.75   260115.........   01.2593   17.02
    240063.......................   01.4355   22.81   240148..........   01.0485   14.55   250050.........   01.2741   13.43   260012.........   01.1050   12.84   260116.........   01.0817   15.06
    240064.......................   01.2914   21.93   240150..........   00.9199   12.84   250051.........   00.8862   10.57   260013.........   01.1935   15.32   260119.........   01.2307   15.30
    240065.......................   01.0337   12.44   240152..........   01.0164   19.91   250057.........   01.2316   15.59   260015.........   01.2710   16.27   260120.........   01.1985   16.64
    240066.......................   01.3815   21.19   240153..........   01.0056   15.23   250058.........   01.1873   14.40   260017.........   01.2333   15.54   260122.........   01.1738   12.73
    240069.......................   01.1890   19.07   240154..........   01.0449   17.00   250059.........   01.0410   14.21   260018.........   00.9010   10.09   260123.........   01.0789   14.05
    240071.......................   01.1104   19.55   240155..........   00.8945   19.40   250060.........   00.7799   08.90   260019.........   01.0877   14.52   260127.........   01.0109   15.92
    240072.......................   01.0197   16.80   240157..........   01.0929   14.13   250061.........   00.8857   17.69   260020.........   01.7249   20.07   260128.........   01.0125   10.96
    240073.......................   00.9372   16.40   240160..........   01.0026   16.30   250063.........   00.8515   12.44   260021.........   01.4657   17.59   260129.........   01.2317   15.69
    240075.......................   01.1813   19.91   240161..........   00.9970   14.99   250065.........   00.9231   12.61   260022.........   01.2879   19.05   260131.........   01.2494   18.04
    240076.......................   01.0703   21.04   240162..........   01.0628   16.59   250066.........   00.9111   13.53   260023.........   01.4980   34.66   260134.........   01.1693   15.67
    240077.......................   00.9446   14.31   240163..........   00.9935   17.79   250067.........   01.1344   14.67   260024.........   00.9639   12.96   260137.........   01.7177   15.26
    240078.......................   01.4829   23.66   240166..........   01.1120   15.60   250068.........   00.8476   11.36   260025.........   01.3101   14.68   260138.........   01.8700   21.26
    240079.......................   01.0280   15.37   240169..........   00.9128   15.98   250069.........   01.3525   17.35   260027.........   01.6202   21.58   260141.........   01.9087   19.54
    240080.......................   01.5649   22.34   240170..........   01.1056   17.38   250071.........   00.9308   11.63   260029.........   01.2388   19.02   260142.........   01.1144   15.65
    240082.......................   01.1936   17.03   240171..........   01.0726   15.79   250072.........   01.4199   18.43   260030.........   01.1850   10.36   260143.........   00.9985   12.75
    240083.......................   01.3140   17.90   240172..........   00.9529   15.82   250077.........   00.9293   11.97   260031.........   01.6090   18.38   260147.........   00.9753   13.55
    240084.......................   01.2434   20.04   240173..........   00.8928   16.66   250078.........   01.4771   14.93   260032.........   01.6629   18.43   260148.........   00.9263   10.32
    240085.......................   00.9719   17.41   240179..........   01.0132   16.66   250079.........   00.8824   17.44   260034.........   01.0573   15.99   260158.........   01.0224   12.65
    240086.......................   01.0849   17.64   240184..........   00.9886   13.04   250081.........   01.3211   16.03   260035.........   01.0046   11.74   260159.........   00.9863   19.26
    240087.......................   01.2026   14.87   240187..........   01.1930   18.48   250082.........   01.4033   13.51   260036.........   01.0154   15.34   260160.........   01.0544   15.82
    240088.......................   01.3869   19.81   240193..........   01.0223   17.61   250083.........   00.9515   12.27   260039.........   01.1258   13.86   260162.........   01.5557   20.64
    240089.......................   00.9840   17.72   240196..........   00.6319   22.78   250084.........   01.1844   17.73   260040.........   01.6625   15.28   260163.........   01.2241   14.59
    240090.......................   01.0465   14.69   240200..........   00.8680   14.48   250085.........   00.9749   12.58   260042.........   01.2599   17.82   260164.........   00.9519   13.24
    240093.......................   01.3293   17.64   240205..........   00.9138  .......  250088.........   01.0022   16.53   260044.........   01.0487   15.91   260166.........   01.2346   19.78
    240094.......................   00.9622   20.49   240206..........   00.8411  .......  250089.........   01.2121   13.89   260047.........   01.4767   17.20   260172.........   00.9986   12.55
    240096.......................   00.9800   17.63   240207..........   01.2109   21.80   250093.........   01.1337   14.36   260048.........   01.2953   20.70   260173.........   01.0314   12.21
    240097.......................   01.0196   21.79   240210..........   01.2788   22.90   250094.........   01.3184   15.45   260050.........   01.0431   16.40   260175.........   01.1175   16.34
    240098.......................   00.9533   20.33   240211..........   00.9038   14.75   250095.........   01.0053   15.92   260052.........   01.3352   19.75   260176.........   01.6500   17.62
    240099.......................   01.0631   13.30   250001..........   01.5514   17.39   250096.........   01.1988   17.01   260053.........   01.1737   11.73   260177.........   01.2846   20.19
    240100.......................   01.2892   18.97   250002..........   00.9820   17.13   250097.........   01.3216   15.83   260054.........   01.3147   16.07   260178.........   01.4976   20.94
    240101.......................   01.1825   20.41   250003..........   01.0084   18.40   250098.........   00.8380   16.66   260055.........   00.9908   10.97   260179.........   01.6431   20.52
    240102.......................   00.9603   12.87   250004..........   01.4873   17.91   250099.........   01.2609   14.01   260057.........   01.1503   16.96   260180.........   01.7064   18.96
    240103.......................   01.0505   16.28   250005..........   00.9412   09.95   250100.........   01.2905   15.26   260059.........   01.2691   14.66   260183.........   01.5177   16.58
    240104.......................   01.2301   21.81   250006..........   00.9862   14.60   250101.........   00.8850   16.65   260061.........   01.1020   14.06   260186.........   01.4347   17.27
    240105.......................   00.9597   13.46   250007..........   01.2808   19.42   250102.........   01.6048   17.06   260062.........   01.2033   18.91   260188.........   01.2198   18.37
    240106.......................   01.4052   26.55   250008..........   00.9814   13.33   250104.........   01.4486   17.62   260063.........   01.0697   15.44   260189.........   00.8526   10.87
    240107.......................   00.9916   17.31   250009..........   01.2300   17.50   250105.........   00.9434   13.40   260064.........   01.3240   16.92   260190.........   01.2045   18.00
    240108.......................   01.0081   17.24   250010..........   01.0398   12.77   250107.........   00.8815   14.53   260065.........   01.8217   18.25   260191.........   01.2516   18.58
    240109.......................   00.9484   12.99   250012..........   00.9311   19.88   250109.........   00.8949   15.37   260066.........   01.0266   15.01   260193.........   01.2915   26.66
    240110.......................   00.9668   16.33   250015..........   01.0847   10.44   250112.........   00.9717   13.07   260067.........   00.8671   13.74   260195.........   01.2198   16.53
    240111.......................   01.0666   19.00   250017..........   00.9989   16.64   250117.........   01.0769   14.70   260068.........   01.6718   20.21   260197.........   01.1405   25.99
    240112.......................   00.9994   14.73   250018..........   00.9513   13.02   250119.........   01.1164   12.45   260070.........   01.0429   14.48   260198.........   01.3077   16.46
    240114.......................   00.9257   14.74   250019..........   01.4335   17.00   250120.........   01.1106   13.09   260073.........   01.1387   12.89   260200.........   01.2666   19.43
    240115.......................   01.6191   21.63   250020..........   00.9455   13.52   250122.........   01.2481   16.91   260074.........   01.3021   13.93   260205.........   01.3757  ......
    240116.......................   00.9343   13.96   250021..........   00.8815   08.57   250123.........   01.2786   18.73   260077.........   01.7307   17.13   270002.........   01.3026   14.15
    240117.......................   01.1588   18.18   250023..........   00.9552   12.77   250124.........   00.9126   11.59   260078.........   01.1782   14.62   270003.........   01.2653   21.02
    240119.......................   00.8258   20.58   250024..........   00.9084   13.60   250125.........   01.3155   16.38   260079.........   01.0765   14.32   270004.........   01.6961   18.01
    240121.......................   00.9397   21.27   250025..........   01.2071   18.06   250126.........   00.9754   14.17   260080.........   01.0516   11.77   270006.........   00.9221   16.35
    240122.......................   01.0517   18.93   250027..........   00.9570   11.90   250127.........   00.8201  .......  260081.........   01.6079   18.83   270007.........   00.8770   12.23
    240123.......................   01.0109   15.03   250029..........   00.8773   12.96   250128.........   01.0941   12.06   260082.........   01.1768   13.93   270009.........   01.1201   19.32
    240124.......................   00.9676   18.39   250030..........   00.9739   14.45   250131.........   01.0232   11.03   260085.........   01.5720   19.71   270011.........   01.0312   18.28
    240125.......................   00.9278   11.73   250031..........   01.3079   18.54   250134.........   00.9919   16.70   260086.........   01.0978   15.09   270012.........   01.5921   18.33
    240127.......................   01.1171   14.25   250032..........   01.2608   16.21   250136.........   00.8821   17.66   260091.........   01.7219   19.76   270014.........   01.8294   17.81
    240128.......................   01.1221   15.77   250033..........   01.0514   15.66   250138.........   01.2904   17.90   260094.........   01.1985   16.48   270016.........   00.8992   15.97
    240129.......................   01.0143   17.56   250034..........   01.6577   14.46   250141.........   01.2616   15.71   260095.........   01.4477   16.89   270017.........   01.2378   19.09
    240130.......................   00.9625   15.66   250035..........   00.8681   13.84   250145.........   00.8232   10.04   260096.........   01.5927   22.03   270019.........   01.0001   15.86
    240132.......................   01.2209   22.40   250036..........   00.9700   14.48   250146.........   00.9630   13.97   260097.........   01.2007   14.79   270021.........   01.1771   16.67
    240133.......................   01.1986   17.72   250037..........   00.9132   10.05   250148.........   01.0955   19.08   260100.........   01.0435   15.72   270023.........   01.3055   21.22
    240135.......................   00.8725   14.11   250038..........   00.9700   14.37   250149.........   00.8930   12.04   260102.........   01.0442   18.57   270026.........   00.8850   14.97
    240137.......................   01.2258   18.97   250039..........   00.9941   13.36   260001.........   01.7040   18.05   260103.........   01.2885   17.51   270027.........   01.1158   12.40
    240138.......................   00.9522   12.97   250040..........   01.3026   16.20   260002.........   01.4644   21.10   260104.........   01.7564   18.42   270028.........   01.1217   15.50
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25630]]
    
    
                                                                                              Page 9 of 15                                                                                          
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    270029.......................   00.9579   18.18   280051..........   01.0812   15.15   290021.........   01.6244   21.94   310041.........   01.4067   23.71   320023.........   01.0840   16.73
    270032.......................   01.1262   16.20   280052..........   01.0846   13.32   290022.........   01.7010   17.94   310042.........   01.2416   23.53   320030.........   01.1495   16.84
    270033.......................   00.8614   15.58   280054..........   01.2607   17.98   290027.........   00.9528   17.23   310043.........   01.1431   20.86   320031.........   00.8258   17.05
    270035.......................   01.0099   18.28   280055..........   00.9182   14.40   290029.........   00.9833  .......  310044.........   01.2847   20.70   320032.........   00.9003   17.10
    270036.......................   00.8802   12.78   280056..........   00.9752   14.45   290032.........   01.4115   22.30   310045.........   01.4639   27.19   320033.........   01.1552   22.76
    270039.......................   01.0024   15.36   280057..........   00.9835   15.40   290036.........   00.9391   51.78   310047.........   01.3682   24.34   320035.........   01.0299   22.89
    270040.......................   01.1080   18.24   280058..........   01.3029   18.34   290038.........   00.9923   19.95   310048.........   01.2820   22.81   320037.........   01.2216   23.31
    270041.......................   01.1062   15.74   280060..........   01.5871   18.65   290039.........   01.3219  .......  310049.........   01.2927   25.66   320038.........   01.2326   16.83
    270044.......................   01.1453   13.98   280061..........   01.4293   17.06   300001.........   01.3935   21.15   310050.........   01.2323   23.05   320046.........   01.2948   20.88
    270046.......................   00.9619   14.85   280062..........   01.0987   13.35   300003.........   01.9474   23.98   310051.........   01.3560   24.27   320048.........   01.2823   14.43
    270048.......................   01.1003   16.41   280064..........   01.0290   15.52   300005.........   01.2963   20.28   310052.........   01.2951   22.60   320057.........   00.9566  ......
    270049.......................   01.7959   20.21   280065..........   01.2779   18.54   300006.........   01.1897   19.05   310054.........   01.3459   24.60   320058.........   00.7512  ......
    270050.......................   01.0985   17.98   280066..........   01.0654   12.50   300007.........   01.1006   18.33   310057.........   01.3357   21.17   320059.........   01.0062  ......
    270051.......................   01.3389   21.08   280068..........   00.9650   09.45   300008.........   01.2856   19.44   310058.........   01.1060   24.61   320060.........   00.8691  ......
    270052.......................   01.0417   17.86   280070..........   01.0106   11.19   300009.........   01.1291   19.41   310060.........   01.2001   18.63   320061.........   01.1829  ......
    270057.......................   01.2418   18.93   280073..........   01.0056   13.68   300010.........   01.1911   19.48   310061.........   01.2520   21.39   320062.........   00.8839  ......
    270058.......................   00.9052   13.38   280074..........   01.1152   14.02   300011.........   01.3744   22.78   310062.........   01.3076   20.98   320063.........   01.3049   16.68
    270059.......................   00.7748   15.90   280075..........   01.1776   13.70   300012.........   01.3351   21.77   310063.........   01.3696   21.02   320065.........   01.2881   16.05
    270060.......................   00.9593   15.08   280076..........   01.0520   13.95   300013.........   01.1894   17.57   310064.........   01.3195   24.32   320067.........   00.8533   15.74
    270063.......................   00.9957   14.82   280077..........   01.3183   17.95   300014.........   01.2855   19.49   310067.........   01.3185   22.76   320068.........   00.9287   16.40
    270072.......................   00.8066   13.85   280079..........   01.0646   10.61   300015.........   01.2367   18.54   310069.........   01.2924   22.42   320069.........   00.9720   10.83
    270073.......................   01.1764   11.83   280080..........   01.1041   13.61   300016.........   01.2347   18.83   310070.........   01.4173   23.33   320070.........   00.9663  ......
    270074.......................   00.8989  .......  280081..........   01.7829   18.66   300017.........   01.3038   21.18   310072.........   01.3090   21.25   320074.........   01.0956   18.00
    270075.......................   00.9172  .......  280082..........   01.0111   13.50   300018.........   01.3126   20.22   310073.........   01.6320   25.21   320079.........   01.1739   17.24
    270076.......................   00.7682  .......  280083..........   01.0442   14.26   300019.........   01.2127   19.97   310074.........   01.4198   22.66   330001.........   01.1965   25.94
    270079.......................   00.8978   13.71   280084..........   01.0067   11.42   300020.........   01.3060   20.45   310075.........   01.4342   24.11   330002.........   01.4751   25.86
    270080.......................   01.1930   16.88   280088..........   01.7594  .......  300021.........   01.0885   17.07   310076.........   01.4454   29.78   330003.........   01.3224   15.68
    270081.......................   01.0272   12.52   280089..........   01.0559   17.29   300022.........   01.0547   17.35   310077.........   01.6821   25.08   330004.........   01.2944   19.87
    270082.......................   01.0743   16.17   280090..........   00.9608   14.34   300023.........   01.3847   20.45   310078.........   01.3970   23.81   330005.........   01.8198   23.51
    270083.......................   01.0915   15.30   280091..........   01.1064   14.54   300024.........   01.2611   19.20   310081.........   01.3268   21.63   330006.........   01.2708   26.60
    270084.......................   00.8820   14.83   280092..........   00.9797   13.94   300028.........   01.2139   17.28   310083.........   01.3087   22.57   330007.........   01.3120   18.50
    280001.......................   01.1071   14.99   280094..........   01.1321   15.40   300029.........   01.3666   22.33   310084.........   01.3916   21.85   330008.........   01.1599   16.96
    280003.......................   02.1164   18.85   280097..........   00.9649   11.94   300033.........   01.1353   16.28   310086.........   01.2187   21.24   330009.........   01.2889   30.94
    280005.......................   01.4013   17.73   280098..........   00.9699   10.71   300034.........   02.0334   22.41   310087.........   01.3224   20.28   330010.........   01.3763   12.50
    280009.......................   01.7524   18.19   280101..........   01.1002   13.51   310001.........   01.8034   25.91   310088.........   01.2207   20.56   330011.........   01.3000   19.95
    280011.......................   00.8691   12.42   280102..........   00.9272   12.45   310002.........   01.8222   25.58   310090.........   01.3629   24.24   330012.........   01.6985   29.74
    280013.......................   01.9321   21.09   280104..........   00.9947   13.11   310003.........   01.2776   23.65   310091.........   01.2907   20.77   330013.........   02.0896   17.73
    280014.......................   00.9234   13.35   280105..........   01.2732   18.10   310005.........   01.2322   21.08   310092.........   01.3142   21.20   330014.........   01.3552   29.38
    280015.......................   01.0353   15.29   280106..........   00.9818   14.48   310006.........   01.2754   22.66   310093.........   01.1662   20.42   330016.........   01.0658   16.94
    280017.......................   01.1197   14.01   280107..........   01.0910   11.45   310008.........   01.3528   23.42   310096.........   01.8816   23.74   330019.........   01.3051   27.77
    280018.......................   01.0384   13.73   280108..........   01.1303   15.09   310009.........   01.3133   23.49   310105.........   01.3010   24.12   330020.........   01.0469   14.30
    280020.......................   01.6464   19.60   280109..........   00.9214   10.58   310010.........   01.2849   20.79   310108.........   01.4365   24.39   330023.........   01.2634   23.47
    280021.......................   01.2618   16.90   280110..........   01.0019   11.44   310011.........   01.2108   21.51   310110.........   01.2714   20.54   330024.........   01.8333   31.66
    280022.......................   01.0382   14.17   280111..........   01.2495   18.27   310012.........   01.6569   26.14   310111.........   01.3831   23.33   330025.........   01.1052   13.57
    280023.......................   01.3988   16.83   280114..........   00.9200   13.00   310013.........   01.4193   21.54   310112.........   01.3408   21.93   330027.........   01.3596   31.94
    280024.......................   00.9571   11.90   280115..........   00.9323   16.12   310014.........   01.6973   25.20   310113.........   01.2698   21.81   330028.........   01.4711   25.53
    280025.......................   00.9430   12.87   280117..........   01.0899   15.93   310015.........   01.9538   25.55   310115.........   01.3332   21.37   330029.........   01.0082   19.40
    280026.......................   01.2113   14.79   280118..........   00.9335   16.45   310016.........   01.2558   24.30   310116.........   01.2758   22.74   330030.........   01.2557   16.43
    280028.......................   01.1079   15.15   280119..........   00.8703  .......  310017.........   01.3828   23.95   310118.........   01.2657   22.78   330033.........   01.2798   16.66
    280029.......................   01.1344   15.52   280123..........   00.8938  .......  310018.........   01.1258   21.68   310119.........   01.7103   30.34   330034.........   00.6391   30.46
    280030.......................   01.7044   27.82   280125..........   01.2392  .......  310019.........   01.6672   24.86   310120.........   01.0971   20.79   330036.........   01.3056   19.62
    280031.......................   01.0150   13.61   290001..........   01.6935   23.03   310020.........   01.3887   22.65   320001.........   01.3857   17.43   330037.........   01.1546   15.46
    280032.......................   01.3002   16.45   290002..........   00.9128   16.13   310021.........   01.3817   23.63   320002.........   01.3670   19.13   330038.........   01.2340   15.52
    280033.......................   01.0406   15.69   290003..........   01.6810   25.76   310022.........   01.3156   21.10   320003.........   01.1238   13.29   330041.........   01.3043   36.69
    280035.......................   01.0337   13.65   290005..........   01.4874   20.79   310024.........   01.3022   23.65   320004.........   01.2792   14.96   330043.........   01.3194   33.46
    280037.......................   01.0415   15.48   290006..........   01.2561   19.14   310025.........   01.2009   21.93   320005.........   01.3531   20.75   330044.........   01.3085   18.10
    280038.......................   01.0023   15.49   290007..........   01.8502   27.93   310026.........   01.2043   23.19   320006.........   01.4170   14.55   330045.........   01.4176   27.45
    280039.......................   01.0469   15.70   290008..........   01.2147   19.60   310027.........   01.3265   21.41   320009.........   01.6244   17.17   330046.........   01.4603   30.06
    280040.......................   01.6269   19.18   290009..........   01.6221   17.91   310028.........   01.2526   21.94   320011.........   01.0077   17.05   330047.........   01.1772   16.85
    280041.......................   00.9134   12.05   290010..........   01.2399   14.00   310029.........   01.9458   23.14   320012.........   00.9924   16.53   330048.........   01.2917   17.45
    280042.......................   01.0344   15.14   290011..........   00.9015   15.52   310031.........   02.8675   22.58   320013.........   01.1521   17.67   330049.........   01.2386   17.85
    280043.......................   01.0147   15.47   290012..........   01.3753   21.50   310032.........   01.3467   22.51   320014.........   01.1514   14.63   330053.........   01.1874   14.83
    280045.......................   01.0969   16.10   290013..........   01.0527   18.62   310034.........   01.2580   21.58   320016.........   01.1211   15.17   330055.........   01.6244   29.81
    280046.......................   01.1072   12.37   290014..........   00.9699   17.46   310036.........   01.1893   19.11   320017.........   01.2111   16.75   330056.........   01.4395   30.22
    280047.......................   01.0907   18.01   290015..........   00.9197   15.18   310037.........   01.3653   27.57   320018.........   01.5827   18.43   330057.........   01.6763   18.74
    280048.......................   01.2131   13.82   290016..........   01.1837   22.67   310038.........   01.9545   26.13   320019.........   01.4848   19.57   330058.........   01.3057   16.66
    280049.......................   01.0412   15.08   290019..........   01.3426   19.74   310039.........   01.2827   21.22   320021.........   01.7502   17.99   330059.........   01.5787   33.67
    280050.......................   00.9263   13.71   290020..........   01.0445   17.29   310040.........   01.2393   23.99   320022.........   01.2213   16.24   330061.........   01.3166   24.36
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25631]]
    
    
                                                                                              Page 10 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    330062.......................   01.0733   17.10   330179..........   00.9045   14.60   330275.........   01.2903   22.06   340031.........   01.0066   12.83   340129.........   01.2985   18.11
    330064.......................   01.4892   32.11   330180..........   01.1983   16.27   330276.........   01.1685   17.92   340032.........   01.3624   18.77   340130.........   01.3225   19.83
    330065.......................   01.2030   18.54   330181..........   01.3528   31.07   330277.........   01.1085   16.57   340035.........   01.1531   17.23   340131.........   01.5209   18.16
    330066.......................   01.2766   17.98   330182..........   02.5453   30.48   330279.........   01.3577   19.05   340036.........   01.2139   18.25   340132.........   01.3256   16.27
    330067.......................   01.3948   20.64   330183..........   01.4677   19.94   330285.........   01.8458   22.66   340037.........   01.0873   14.46   340133.........   01.1268   14.74
    330072.......................   01.4097   29.92   330184..........   01.3264   27.58   330286.........   01.3379   24.38   340038.........   01.1012   16.68   340137.........   01.1310   15.62
    330073.......................   01.2255   15.82   330185..........   01.2827   24.72   330290.........   01.6841   32.27   340039.........   01.2681   19.88   340138.........   01.0625   16.94
    330074.......................   01.3127   17.25   330186..........   00.5618   20.30   330293.........   01.1953   15.09   340040.........   01.8191   18.61   340141.........   01.7229   20.28
    330075.......................   01.0589   17.73   330188..........   01.1830   18.71   330304.........   01.2338   27.04   340041.........   01.2094   17.69   340142.........   01.2350   15.79
    330078.......................   01.4268   17.96   330189..........   01.3232   16.54   330306.........   01.4286   28.10   340042.........   01.2260   15.70   340143.........   01.4228   19.62
    330079.......................   01.2427   17.22   330191..........   01.3283   18.17   330307.........   01.2663   19.23   340044.........   01.1020   18.87   340144.........   01.3656   18.96
    330080.......................   01.3325   27.06   330193..........   01.3516   28.64   330314.........   01.3785   21.50   340045.........   00.9956   14.02   340145.........   01.4314   18.88
    330084.......................   01.0696   17.68   330194..........   01.7808   31.20   330315.........   16.0413   30.36   340047.........   01.8288   19.42   340146.........   01.1145   14.28
    330085.......................   01.2974   18.59   330195..........   01.6416   31.94   330316.........   01.3084   22.23   340048.........   01.0275   05.23   340147.........   01.2535   19.21
    330086.......................   01.2666   26.87   330196..........   01.2608   27.80   330327.........   00.9713   16.98   340049.........   01.0355   17.75   340148.........   01.4937   18.55
    330088.......................   01.0531   22.43   330197..........   01.1287   16.79   330331.........   01.3121   29.10   340050.........   01.2003   17.95   340151.........   01.2078   15.67
    330090.......................   01.5991   17.92   330198..........   01.3837   23.21   330332.........   01.2892   26.99   340051.........   01.3356   16.79   340153.........   01.8814   19.87
    330091.......................   01.3584   18.01   330199..........   01.3382   25.90   330333.........   01.2444   51.91   340052.........   01.0223   21.14   340155.........   01.3840   21.24
    330092.......................   01.0542   14.25   330201..........   01.6866   40.72   330336.........   01.3094   30.29   340053.........   01.6440   19.44   340156.........   00.7966  ......
    330094.......................   01.2399   17.06   330202..........   01.3886   27.41   330338.........   01.2333   20.97   340054.........   01.2239   14.35   340158.........   01.1278   16.49
    330095.......................   01.2452   18.40   330203..........   01.3959   19.61   330339.........   00.9320   18.87   340055.........   01.2769   17.40   340159.........   01.1375   16.21
    330096.......................   01.1887   15.81   330204..........   01.3552   28.88   330340.........   01.2344   22.43   340060.........   01.1293   17.75   340160.........   01.1672   14.11
    330097.......................   01.2171   15.32   330205..........   01.1763   19.85   330350.........   01.6747   28.46   340061.........   01.7280   20.31   340162.........   01.1787   16.56
    330100.......................   00.7936   28.03   330208..........   01.2263   26.41   330353.........   01.2772   31.43   340063.........   01.0171   22.75   340164.........   01.4579   20.69
    330101.......................   01.8106   30.39   330209..........   01.1811   24.53   330354.........   01.5676  .......  340064.........   01.2364   17.05   340166.........   01.2776   19.58
    330102.......................   01.3312   17.00   330211..........   01.2029   18.46   330357.........   01.3809   34.81   340065.........   01.2854   15.89   340168.........   00.4875   15.15
    330103.......................   01.2449   16.63   330212..........   01.1468   24.26   330359.........   00.9373   29.31   340067.........   01.1587   18.20   340171.........   01.2031  ......
    330104.......................   01.4313   27.69   330213..........   01.1701   18.39   330372.........   01.1964   22.25   340068.........   01.2139   16.56   340173.........   01.2130  ......
    330106.......................   01.6949   34.04   330214..........   01.8173   31.94   330381.........   01.2852   29.21   340069.........   01.8495   20.34   350001.........   00.9857   14.51
    330107.......................   01.3314   26.04   330215..........   01.2026   17.11   330385.........   01.1940   29.15   340070.........   01.3026   18.49   350002.........   01.8548   16.86
    330108.......................   01.2467   16.97   330218..........   01.0527   20.44   330386.........   01.2158   23.26   340071.........   01.0889   15.86   350003.........   01.1701   16.63
    330111.......................   01.0751   15.08   330219..........   01.6629   20.87   330387.........   00.7923   30.68   340072.........   01.1279   15.86   350004.........   01.9174   18.34
    330114.......................   00.9490   15.82   330221..........   01.2904   29.07   330389.........   01.7245   31.92   340073.........   01.5386   19.84   350005.........   01.0598   14.07
    330115.......................   01.2405   16.12   330222..........   01.2606   18.36   330390.........   01.3751   31.67   340075.........   01.1939   16.88   350006.........   01.5142   16.25
    330116.......................   00.9611   15.34   330223..........   01.0770   16.39   330393.........   01.7444   25.45   340080.........   01.0339   15.49   350007.........   00.8879   13.24
    330118.......................   01.6591   20.00   330224..........   01.2569   21.50   330394.........   01.5407   18.21   340084.........   01.0889   16.12   350008.........   00.9420   16.74
    330119.......................   01.7636   32.85   330225..........   01.1739   24.76   330395.........   01.3488   33.16   340085.........   01.1663   16.33   350009.........   01.1468   17.04
    330121.......................   01.0383   15.12   330226..........   01.2590   17.82   330396.........   01.1754   31.55   340087.........   01.1169   16.53   350010.........   01.1050   13.74
    330122.......................   01.0650   22.97   330229..........   01.3257   16.25   330397.........   01.3150   30.46   340088.........   01.1258   18.13   350011.........   01.8836   20.64
    330125.......................   01.9179   20.66   330230..........   01.3791   29.27   330398.........   01.3550   29.49   340089.........   01.0120   13.83   350012.........   01.1086   13.55
    330126.......................   01.1519   22.70   330231..........   01.0674   29.53   330399.........   01.2625   29.60   340090.........   01.1444   17.83   350013.........   01.1051   16.53
    330127.......................   01.3403   29.65   330232..........   01.2445   17.76   340001.........   01.4796   17.91   340091.........   01.7002   19.89   350014.........   00.9841   13.14
    330128.......................   01.2625   29.68   330233..........   01.4948   30.49   340002.........   01.8416   18.45   340093.........   01.0697   13.96   350015.........   01.7381   16.56
    330132.......................   01.2001   13.55   330234..........   02.3119   31.88   340003.........   01.1252   17.14   340094.........   01.4789   18.27   350016.........   01.0963   11.47
    330133.......................   01.3701   34.67   330235..........   01.1204   19.21   340004.........   01.4483   18.79   340096.........   01.1483   17.40   350017.........   01.3990   16.68
    330135.......................   01.1994   19.14   330236..........   01.4074   28.47   340005.........   01.1650   14.89   340097.........   01.1445   17.69   350018.........   01.0846   17.93
    330136.......................   01.2894   19.26   330238..........   01.1749   15.02   340006.........   01.0428   14.76   340098.........   01.6889   19.32   350019.........   01.6863   18.72
    330140.......................   01.7769   18.58   330239..........   01.1666   16.21   340007.........   01.1704   16.96   340099.........   01.2134   13.03   350021.........   01.0260   12.00
    330141.......................   01.3850   24.49   330240..........   01.3279   27.67   340008.........   01.1373   17.84   340101.........   01.0627   11.87   350023.........   00.9286   15.16
    330144.......................   00.9394   15.19   330241..........   01.9705   21.51   340010.........   01.2998   17.56   340104.........   00.9970   11.37   350024.........   01.0368   16.47
    330148.......................   01.0767   15.47   330242..........   01.3423   25.14   340011.........   01.1622   15.71   340105.........   01.3725   18.85   350025.........   01.0095   14.00
    330151.......................   01.1172   14.68   330245..........   01.3076   17.00   340012.........   01.3162   17.04   340106.........   01.2505   20.04   350027.........   00.9540   14.46
    330152.......................   01.4137   30.10   330246..........   01.3839   25.91   340013.........   01.2800   17.33   340107.........   01.3591   17.08   350029.........   00.8728   12.98
    330153.......................   01.7338   16.97   330247..........   00.9015   27.38   340014.........   01.5587   22.23   340109.........   01.3186   17.38   350030.........   01.0496   16.65
    330154.......................   01.7268  .......  330249..........   01.1933   16.18   340015.........   01.3007   20.37   340111.........   01.1989   14.63   350033.........   00.9198   14.40
    330157.......................   01.3501   19.72   330250..........   01.2870   17.98   340016.........   01.1912   16.24   340112.........   00.9917   15.24   350034.........   00.9924   17.45
    330158.......................   01.4999   20.48   330252..........   00.9461   16.84   340017.........   01.2474   14.31   340113.........   01.8577   20.59   350035.........   00.9005   10.21
    330159.......................   01.2907   17.88   330254..........   01.1696   17.12   340018.........   01.2456   16.25   340114.........   01.5500   20.34   350038.........   01.0922   15.28
    330160.......................   01.4736   29.42   330258..........   01.3355   30.01   340019.........   01.0224   20.26   340115.........   01.5723   19.35   350039.........   01.0288   14.75
    330162.......................   01.2185   27.06   330259..........   01.5025   23.47   340020.........   01.1977   19.04   340116.........   01.8178   19.81   350041.........   01.0442   17.60
    330163.......................   01.1905   19.14   330261..........   01.2944   26.17   340021.........   01.2336   17.51   340119.........   01.2970   16.41   350042.........   01.1142   15.19
    330164.......................   01.4954   19.87   330263..........   01.0305   17.91   340022.........   01.0586   16.91   340120.........   01.0817   13.56   350043.........   01.5670   14.65
    330166.......................   01.0125   13.56   330264..........   01.2135   21.71   340023.........   01.3771   17.77   340121.........   01.0648   15.43   350044.........   00.8768   11.49
    330167.......................   01.6539   29.65   330265..........   01.3931   16.33   340024.........   01.1393   16.33   340123.........   01.0906   15.57   350047.........   01.1941   16.54
    330169.......................   01.4639   32.41   330267..........   01.3643   23.95   340025.........   01.2234   15.47   340124.........   01.0127   13.98   350049.........   01.3354   13.86
    330171.......................   01.4007   23.94   330268..........   00.9663   15.02   340027.........   01.2058   16.89   340125.........   01.4796   16.50   350050.........   00.9591   11.89
    330175.......................   01.1894   15.10   330270..........   01.9872   31.03   340028.........   01.5976   16.85   340126.........   01.3940   16.50   350051.........   00.9832   15.74
    330177.......................   00.9633   14.78   330273..........   01.3059   25.72   340030.........   02.0173   21.06   340127.........   01.3339   17.51   350053.........   01.0118   11.88
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25632]]
    
    
                                                                                              Page 11 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    350055.......................   00.9999   13.76   360074..........   01.3337   18.00   360159.........   01.2116   19.84   370029.........   01.2602   13.51   370149.........   01.2900   15.69
    350056.......................   00.9564   13.88   360075..........   01.4441   21.40   360161.........   01.2549   13.69   370030.........   01.1832   16.49   370153.........   01.0658   14.06
    350058.......................   00.9230   12.18   360076..........   01.3645   18.64   360163.........   01.8032   20.26   370032.........   01.5887   16.17   370154.........   01.0434   14.12
    350060.......................   00.8587   08.80   360077..........   01.5831   19.38   360164.........   00.9634   15.60   370033.........   01.0599   12.34   370156.........   01.0577   17.29
    350061.......................   01.0645   15.31   360078..........   01.2491   19.90   360165.........   01.1732   17.81   370034.........   01.2337   14.36   370158.........   01.0253   12.09
    350063.......................   00.8843  .......  360079..........   01.8666   21.04   360166.........   01.1873   16.01   370035.........   01.6429   16.77   370159.........   01.3951   15.05
    350064.......................   00.8364  .......  360080..........   01.1462   15.68   360170.........   01.3808   16.53   370036.........   01.0721   10.54   370163.........   01.0022   14.57
    360001.......................   01.3790   17.65   360081..........   01.3761   19.70   360172.........   01.3455   17.89   370037.........   01.7160   18.63   370165.........   01.1291   11.97
    360002.......................   01.1925   17.82   360082..........   01.3254   23.27   360174.........   01.3284   18.44   370038.........   01.0052   11.68   370166.........   01.1323   15.55
    360003.......................   01.7561   22.14   360084..........   01.6045   20.53   360175.........   01.1937   20.19   370039.........   01.2616   13.93   370169.........   01.0593   11.91
    360006.......................   01.8372   20.93   360085..........   01.8333   21.47   360176.........   01.1290   15.34   370040.........   01.0977   15.04   370170.........   01.0046  ......
    360007.......................   01.0627   15.95   360086..........   01.4331   17.81   360177.........   01.2931   18.27   370041.........   00.9733   16.47   370171.........   01.0182  ......
    360008.......................   01.2396   17.78   360087..........   01.4291   18.51   360178.........   01.2433   17.16   370042.........   00.8835   13.98   370172.........   00.9229  ......
    360009.......................   01.4867   17.38   360088..........   01.3676   19.09   360179.........   01.3391   19.50   370043.........   00.9443   15.18   370173.........   01.1000  ......
    360010.......................   01.2461   17.09   360089..........   01.1769   17.84   360180.........   02.1577   23.00   370045.........   00.9900   09.83   370174.........   00.7547  ......
    360011.......................   01.3403   18.91   360090..........   01.2425   19.75   360184.........   00.4293   18.76   370046.........   00.9817   10.89   370176.........   01.2219   16.29
    360012.......................   01.3150   19.72   360091..........   01.2836   20.40   360185.........   01.2259   18.13   370047.........   01.3904   15.04   370177.........   00.9737   10.48
    360013.......................   01.1386   18.36   360092..........   01.1263   19.47   360186.........   01.1539   10.45   370048.........   01.2228   15.40   370178.........   01.0021   11.20
    360014.......................   01.2083   18.87   360093..........   01.1654   17.64   360187.........   01.4085   17.67   370049.........   01.3327   15.44   370179.........   00.7441   15.19
    360016.......................   01.6147   18.36   360094..........   01.3940   18.15   360188.........   00.9725   17.11   370051.........   00.9867   11.30   370180.........   00.9135  ......
    360017.......................   01.8633   21.51   360095..........   01.2581   19.83   360189.........   01.1592   16.98   370054.........   01.4696   16.32   370183.........   01.0309   10.35
    360018.......................   01.6285   19.87   360096..........   01.1266   17.46   360192.........   01.3663   21.31   370056.........   01.5245   18.44   370186.........   00.9921   13.32
    360019.......................   01.2657   21.76   360098..........   01.4265   18.26   360193.........   01.2971   16.98   370057.........   01.1165   15.27   370190.........   01.5486   26.42
    360020.......................   01.4424   20.72   360099..........   01.0479   19.53   360194.........   01.2855   17.89   370059.........   01.0974   17.49   370192.........   01.2229   16.30
    360024.......................   01.3762   17.75   360100..........   01.2888   18.00   360195.........   01.1587   19.33   370060.........   01.1260   13.90   370196.........   00.8240  ......
    360025.......................   01.3562   19.40   360101..........   01.3901   21.04   360197.........   01.1688   19.16   370063.........   01.1782   16.95   370197.........   00.9846  ......
    360026.......................   01.3485   16.21   360102..........   01.2869   19.19   360200.........   01.0276   15.62   370064.........   00.9593   10.71   370198.........   01.7997  ......
    360027.......................   01.4597   20.14   360103..........   01.3578   19.87   360203.........   01.2094   14.41   370065.........   00.9924   15.36   380001.........   01.2902   18.13
    360028.......................   01.4846   17.21   360106..........   01.1021   16.08   360204.........   01.2422   19.09   370071.........   01.0530   10.05   380002.........   01.2715   18.07
    360029.......................   01.1846   17.74   360107..........   01.2417   17.37   360210.........   01.2012   20.61   370072.........   00.8635   14.04   380003.........   01.2260   28.86
    360030.......................   01.2891   16.67   360108..........   01.0913   16.45   360211.........   01.2671   19.64   370076.........   01.2612   12.45   380004.........   01.7003   23.04
    360031.......................   01.2807   19.33   360109..........   01.1094   18.64   360212.........   01.3941   20.16   370078.........   01.7411   16.06   380005.........   01.2187   22.81
    360032.......................   01.0729   17.87   360112..........   01.8012   23.33   360213.........   01.2686   18.05   370079.........   00.9534   15.91   380006.........   01.2870   19.61
    360034.......................   01.3225   14.77   360113..........   01.3630   15.36   360218.........   01.3047   18.29   370080.........   00.9738   14.18   380007.........   01.6852   24.92
    360035.......................   01.6186   20.73   360114..........   01.1017   17.48   360230.........   01.5624   21.16   370082.........   00.9220   13.85   380008.........   01.0543   19.56
    360036.......................   01.3579   19.04   360115..........   01.2554   17.92   360231.........   01.1494   12.39   370083.........   00.9508   12.81   380009.........   01.8821   22.90
    360037.......................   02.0580   21.38   360116..........   01.0983   17.49   360234.........   01.3469   16.44   370084.........   01.0827   13.65   380010.........   01.0520   22.58
    360038.......................   01.5828   20.60   360118..........   01.3521   18.34   360236.........   01.2893   25.36   370085.........   00.8717   13.21   380011.........   01.0490   19.05
    360039.......................   01.3135   17.40   360121..........   01.2409   19.22   360239.........   01.3034   19.65   370086.........   01.1713   11.51   380013.........   01.3177   20.62
    360040.......................   01.3495   17.81   360123..........   01.2744   19.33   360241.........   00.4699   21.14   370089.........   01.2580   15.23   380014.........   01.6295   22.02
    360041.......................   01.3392   18.83   360125..........   01.0992   17.41   360242.........   01.8068  .......  370091.........   01.7259   19.16   380017.........   01.9390   25.87
    360042.......................   01.1862   18.02   360126..........   01.2179   20.75   360243.........   00.7287   14.26   370092.........   01.0247   14.09   380018.........   01.8034   20.94
    360044.......................   01.1205   15.83   360127..........   01.1844   17.85   360245.........   00.7295   15.21   370093.........   01.8539   17.71   380019.........   01.2880   21.45
    360045.......................   01.4762   20.73   360128..........   01.1314   15.05   360247.........   00.4164  .......  370094.........   01.5130   19.25   380020.........   01.5022   21.41
    360046.......................   01.1449   17.71   360129..........   00.9665   15.12   360248.........   01.7504  .......  370095.........   00.9994   11.75   380021.........   01.2890   21.57
    360047.......................   01.1368   14.51   360130..........   01.1237   15.93   370001.........   01.7845   20.06   370097.........   01.3708   17.38   380022.........   01.1715   22.57
    360048.......................   01.8279   21.60   360131..........   01.3442   18.99   370002.........   01.1524   13.71   370099.........   01.1771   14.07   380023.........   01.2243   18.43
    360049.......................   01.1856   19.60   360132..........   01.4255   18.28   370004.........   01.2310   16.67   370100.........   01.0076   14.49   380025.........   01.3449   25.35
    360050.......................   01.0987   12.40   360133..........   01.5948   18.70   370005.........   01.0032   14.07   370103.........   00.9320   16.27   380026.........   01.1604   19.09
    360051.......................   01.6396   23.55   360134..........   01.7247   20.07   370006.........   01.2654   15.48   370105.........   01.9777   18.43   380027.........   01.2943   22.82
    360052.......................   01.7665   18.65   360136..........   01.0811   16.90   370007.........   01.2216   14.36   370106.........   01.5469   18.37   380029.........   01.1592   18.33
    360054.......................   01.2934   16.53   360137..........   01.6532   19.95   370008.........   01.3784   17.77   370108.........   01.1298   11.81   380031.........   00.9808   22.48
    360055.......................   01.2577   19.64   360140..........   00.9788   16.21   370011.........   01.0524   12.91   370112.........   01.0696   14.65   380033.........   01.7744   24.22
    360056.......................   01.4280   20.89   360141..........   01.5661   23.32   370012.........   00.8733   09.87   370113.........   01.1887   15.11   380035.........   01.2910   21.53
    360057.......................   01.1603   15.46   360142..........   01.0197   16.62   370013.........   01.8435   19.24   370114.........   01.6464   15.79   380036.........   01.0585   20.79
    360058.......................   01.2702   17.56   360143..........   01.4294   19.90   370014.........   01.2842   19.35   370121.........   01.1723   16.84   380037.........   01.2761   20.52
    360059.......................   01.6935   21.65   360144..........   01.3319   19.89   370015.........   01.2181   17.16   370122.........   01.1283   12.45   380038.........   01.3383   25.28
    360062.......................   01.5157   20.52   360145..........   01.6848   18.18   370016.........   01.3747   16.52   370123.........   01.3288   17.25   380039.........   01.3184   21.50
    360063.......................   01.1355   18.29   360147..........   01.2300   16.40   370017.........   01.1872   11.23   370125.........   00.9809   12.01   380040.........   01.2643   21.08
    360064.......................   01.6110   21.73   360148..........   01.1746   17.80   370018.........   01.3459   18.25   370126.........   00.9821   12.07   380042.........   01.0847   17.33
    360065.......................   01.2978   18.23   360149..........   01.2144   18.68   370019.........   01.3577   14.79   370131.........   00.9568   15.71   380047.........   01.7005   21.15
    360066.......................   01.5064   18.92   360150..........   01.2765   20.02   370020.........   01.3041   11.86   370133.........   01.1458   11.04   380048.........   01.0727   15.35
    360067.......................   01.1473   13.46   360151..........   01.3441   17.15   370021.........   00.9234   10.38   370138.........   01.0828   15.12   380050.........   01.4632   18.30
    360068.......................   01.7403   21.49   360152..........   01.5138   19.73   370022.........   01.3220   17.34   370139.........   01.1101   11.70   380051.........   01.6000   20.79
    360069.......................   01.1413   17.25   360153..........   01.1322   13.86   370023.........   01.3350   16.03   370140.........   01.0074   11.92   380052.........   01.2194   17.97
    360070.......................   01.6991   16.22   360154..........   01.0127   13.29   370025.........   01.3416   16.09   370141.........   01.3413   15.22   380055.........   01.0479   25.16
    360071.......................   01.3655   14.35   360155..........   01.3655   20.38   370026.........   01.4980   16.66   370146.........   01.1663   11.23   380056.........   01.1095   16.82
    360072.......................   01.2294   17.52   360156..........   01.2889   18.45   370028.........   01.9096   20.31   370148.........   01.4901   27.04   380060.........   01.4546   22.68
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25633]]
    
    
                                                                                              Page 12 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    380061.......................   01.5010   21.24   390054..........   01.1925   16.20   390138.........   01.3274   17.99   390242.........   01.3211   18.77   400120.........   01.3210   09.45
    380062.......................   01.2271   18.32   390055..........   01.8803   26.53   390139.........   01.5292   23.00   390244.........   00.9008   12.10   400121.........   00.9061   06.57
    380063.......................   01.2398   18.55   390056..........   01.1583   16.53   390142.........   01.6012   28.56   390245.........   01.4283   21.37   400122.........   01.0071   07.20
    380064.......................   01.3645   18.24   390057..........   01.3181   19.58   390145.........   01.3627   20.30   390246.........   01.2381   17.91   400123.........   01.1923   08.39
    380065.......................   01.2612   22.48   390058..........   01.2736   18.64   390146.........   01.2696   16.85   390247.........   01.0888   20.42   400124.........   02.6899   11.00
    380066.......................   01.3314   20.01   390060..........   01.2044   16.88   390147.........   01.2520   20.55   390249.........   01.0117   12.79   410001.........   01.3885   21.15
    380068.......................   00.9929   21.71   390061..........   01.5126   20.08   390150.........   01.1850   20.98   390256.........   01.8065   24.05   410004.........   01.3542   21.95
    380069.......................   01.1237   19.35   390062..........   01.1873   16.43   390151.........   01.2236   19.88   390258.........   01.3894   20.71   410005.........   01.3893   22.97
    380070.......................   01.3856   25.32   390063..........   01.7711   20.19   390152.........   01.0833   17.35   390260.........   01.2324   23.05   410006.........   01.3047   21.58
    380071.......................   01.2895   20.13   390065..........   01.2445   19.95   390153.........   01.2347   22.04   390262.........   01.8663   18.17   410007.........   01.6895   21.22
    380072.......................   00.9525   16.03   390066..........   01.2979   19.58   390154.........   01.2149   17.37   390263.........   01.4746   19.75   410008.........   01.2641   20.03
    380075.......................   01.3760   19.99   390067..........   01.7841   19.97   390156.........   01.4353   20.56   390265.........   01.3029   19.06   410009.........   01.3206   23.53
    380078.......................   00.9840   18.28   390068..........   01.3034   19.04   390157.........   01.3790   18.98   390266.........   01.2200   16.95   410010.........   01.0628   26.80
    380081.......................   01.1300   18.28   390069..........   01.3386   20.08   390158.........   01.5582   19.47   390267.........   01.3089   19.01   410011.........   01.2360   23.92
    380082.......................   01.3109   21.55   390070..........   01.3343   19.37   390160.........   01.2930   19.68   390268.........   01.3484   21.17   410012.........   01.8346   21.15
    380083.......................   01.2950   21.90   390071..........   01.0930   15.04   390161.........   01.1318   13.75   390270.........   01.3595   17.08   410013.........   01.2926   24.44
    380084.......................   01.2579   21.98   390072..........   01.0866   15.49   390162.........   01.5617   21.02   390272.........   00.4562  .......  420002.........   01.3852   21.83
    380087.......................   01.0848   12.91   390073..........   01.6243   19.82   390163.........   01.2249   16.11   390277.........   00.5292   23.14   420004.........   01.8530   18.30
    380088.......................   01.0227   18.65   390074..........   01.2608   16.62   390164.........   02.1585   22.59   390278.........   00.6728   16.94   420005.........   01.1718   15.14
    380089.......................   01.3275   23.92   390075..........   01.3632   17.48   390166.........   01.1125   18.97   390279.........   01.0386   14.40   420006.........   01.1714   17.68
    380090.......................   01.2856   25.49   390076..........   01.4253   21.97   390167.........   01.3655   21.84   400001.........   01.2646   09.39   420007.........   01.5056   17.78
    380091.......................   01.3021   24.95   390078..........   01.0805   18.92   390168.........   01.2845   18.12   400002.........   01.6156   10.99   420009.........   01.2431   17.01
    390001.......................   01.4101   21.89   390079..........   01.7802   17.91   390169.........   01.2814   18.85   400003.........   01.3181   08.34   420010.........   01.2029   15.22
    390002.......................   01.2997   19.71   390080..........   01.3128   18.40   390170.........   01.8882   21.93   400004.........   01.1998   08.16   420011.........   01.1862   15.88
    390003.......................   01.2251   17.48   390081..........   01.3443   21.33   390173.........   01.2026   17.81   400005.........   01.0804   06.50   420014.........   01.0521   15.49
    390004.......................   01.3957   17.68   390083..........   01.2260   17.49   390174.........   01.6821   28.75   400006.........   01.2047   07.62   420015.........   01.3602   17.27
    390005.......................   01.0449   16.56   390084..........   01.1848   15.92   390176.........   01.1634   18.54   400007.........   01.1616   07.13   420016.........   00.9967   14.27
    390006.......................   01.7963   18.43   390086..........   01.1623   17.91   390178.........   01.3125   19.14   400009.........   01.0382   07.64   420018.........   01.8076   19.64
    390007.......................   01.2165   20.24   390088..........   01.3418   21.04   390179.........   01.3565   21.31   400010.........   00.9135   10.07   420019.........   01.1909   14.81
    390008.......................   01.1475   16.70   390090..........   01.7964   20.56   390180.........   01.4771   23.13   400011.........   01.0608   07.81   420020.........   01.2623   17.58
    390009.......................   01.6945   19.72   390091..........   01.1404   18.52   390181.........   01.0478   19.10   400012.........   01.1906   07.69   420023.........   01.4452   19.27
    390010.......................   01.2666   16.99   390093..........   01.1546   15.95   390183.........   01.1759   18.03   400013.........   01.2834   08.06   420026.........   01.8876   18.73
    390011.......................   01.2805   18.32   390095..........   01.2041   15.21   390184.........   01.1047   18.24   400014.........   01.3803   08.68   420027.........   01.3581   17.34
    390012.......................   01.2209   19.43   390096..........   01.5027   17.87   390185.........   01.2232   17.20   400015.........   01.3729  .......  420030.........   01.2949   17.49
    390013.......................   01.2405   18.14   390097..........   01.2959   22.07   390189.........   01.1429   19.19   400016.........   01.3717   11.37   420031.........   00.9613   12.23
    390015.......................   01.1529   13.06   390100..........   01.6655   20.58   390191.........   01.2270   16.80   400017.........   01.2069   06.56   420033.........   01.2721   19.24
    390016.......................   01.2456   17.76   390101..........   01.2042   17.62   390192.........   01.1586   15.64   400018.........   01.2977   09.29   420036.........   01.4355   18.46
    390017.......................   01.2175   15.86   390102..........   01.3763   19.60   390193.........   01.2088   17.26   400019.........   01.7668   09.58   420037.........   01.1963   21.60
    390018.......................   01.3160   19.26   390103..........   01.1383   18.62   390194.........   01.1410   18.95   400021.........   01.4606   09.43   420038.........   01.3331   15.74
    390019.......................   01.1409   16.01   390104..........   01.0956   14.75   390195.........   01.8448   22.62   400022.........   01.3456   11.18   420039.........   01.1544   16.21
    390022.......................   01.3648   20.49   390106..........   01.0527   15.96   390196.........   01.3776  .......  400024.........   01.0267   07.45   420042.........   01.1022   14.56
    390023.......................   01.2385   18.03   390107..........   01.3456   19.43   390197.........   01.3002   17.67   400026.........   00.9852   06.04   420043.........   01.2299   18.79
    390024.......................   01.0879   23.53   390108..........   01.3676   19.21   390198.........   01.2119   15.83   400027.........   01.1410   08.07   420048.........   01.2492   13.44
    390025.......................   00.6397   15.37   390109..........   01.2783   14.91   390199.........   01.3245   15.86   400028.........   01.0099   07.98   420049.........   01.1743   16.46
    390026.......................   01.3006   21.98   390110..........   01.6319   19.36   390200.........   01.0981   17.18   400029.........   01.0884   10.05   420051.........   01.6278   17.99
    390027.......................   01.8620   28.88   390111..........   01.8454   29.97   390201.........   01.2808   20.12   400031.........   01.2349   09.50   420053.........   01.1996   16.08
    390028.......................   01.8946   19.73   390112..........   01.2860   13.72   390203.........   01.3856   22.12   400032.........   01.2495   08.99   420054.........   01.2953   17.01
    390029.......................   01.9719   18.87   390113..........   01.2274   17.00   390204.........   01.3041   20.57   400044.........   01.1780   09.84   420055.........   01.0131   15.72
    390030.......................   01.2422   18.37   390114..........   01.2178   21.25   390206.........   01.3925   19.09   400048.........   01.1548   08.23   420056.........   01.0853   13.21
    390031.......................   01.1866   18.45   390115..........   01.3792   23.95   390209.........   01.0699   16.37   400061.........   01.6558   14.42   420057.........   01.1687   14.71
    390032.......................   01.2567   19.11   390116..........   01.2709   23.74   390211.........   01.2499   18.17   400079.........   01.2819   10.43   420059.........   00.9796   15.11
    390035.......................   01.2478   17.14   390117..........   01.1848   16.64   390213.........   01.1615   19.15   400087.........   01.4420   10.90   420061.........   01.1681   17.58
    390036.......................   01.4518   19.18   390118..........   01.1802   16.48   390215.........   01.2938   24.51   400094.........   01.0401   06.88   420062.........   01.4640   15.61
    390037.......................   01.3834   19.24   390119..........   01.3516   18.05   390217.........   01.2323   20.29   400098.........   01.3576   08.48   420064.........   01.1124   14.50
    390039.......................   01.1357   16.31   390121..........   01.3576   19.61   390219.........   01.3267   19.86   400102.........   01.1698   04.27   420065.........   01.3464   18.10
    390040.......................   00.9663   16.73   390122..........   01.1007   18.49   390220.........   01.2025   18.22   400103.........   01.4518   09.30   420066.........   00.9577   16.65
    390041.......................   01.2908   18.92   390123..........   01.3805   20.31   390222.........   01.2859   20.89   400104.........   01.3442   09.05   420067.........   01.2622   18.10
    390042.......................   01.5647   21.41   390125..........   01.2001   15.48   390223.........   01.5318   22.49   400105.........   01.2514   08.85   420068.........   01.4309   17.58
    390043.......................   01.1558   18.18   390126..........   01.2793   19.94   390224.........   00.9047   15.35   400106.........   01.2522   08.61   420069.........   01.0556   18.03
    390044.......................   01.6721   19.24   390127..........   01.2446   21.39   390225.........   01.1782   17.76   400109.........   01.4903   09.61   420070.........   01.2279   16.89
    390045.......................   01.8045   17.60   390128..........   01.2398   19.93   390226.........   01.7896   23.48   400110.........   01.0649   08.99   420071.........   01.3120   18.25
    390046.......................   01.5550   20.26   390130..........   01.1635   16.56   390228.........   01.2819   19.19   400111.........   01.1917   08.80   420072.........   00.9800   11.63
    390047.......................   01.9134   30.25   390131..........   01.3311   16.73   390231.........   01.4331   24.08   400112.........   01.1131   08.91   420073.........   01.3017   20.68
    390048.......................   01.1814   18.12   390132..........   01.2825   22.21   390233.........   01.3151   18.31   400113.........   01.2139   08.29   420074.........   01.0054   13.73
    390049.......................   01.6700   21.29   390133..........   01.8226   22.97   390235.........   01.5371   23.51   400114.........   01.0730   08.19   420075.........   00.9408   13.75
    390050.......................   02.1813   22.47   390135..........   01.2353   21.67   390236.........   01.1865   16.40   400115.........   01.0700   08.58   420078.........   01.8491   21.18
    390051.......................   02.1743   25.65   390136..........   01.1261   15.10   390237.........   01.6160   19.08   400117.........   01.1921   09.36   420079.........   01.5774   19.07
    390052.......................   01.1794   15.47   390137..........   01.5138   16.40   390238.........   01.4870   18.78   400118.........   01.2634   10.06   420080.........   01.3760   24.17
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25634]]
    
    
                                                                                              Page 13 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    420082.......................   01.5220   18.32   440011..........   01.3887   17.79   440135.........   01.2276   19.84   450039.........   01.4508   17.93   450150.........   00.9615   10.86
    420083.......................   01.2939   19.79   440012..........   01.6038   18.49   440137.........   01.0953   13.42   450040.........   01.5337   17.64   450151.........   01.1421   15.82
    420085.......................   01.4964   17.31   440014..........   00.9585   14.66   440141.........   01.0489   16.14   450042.........   01.7796   17.20   450152.........   01.2733   16.88
    420086.......................   01.4475   18.16   440015..........   01.7375   15.39   440142.........   01.0746   12.75   450044.........   01.5602   20.09   450153.........   01.5917   18.67
    420087.......................   01.6840   18.21   440016..........   01.0127   12.66   440143.........   01.0957   17.21   450046.........   01.4559   12.99   450154.........   01.1522   14.43
    420088.......................   01.1409   16.23   440017..........   01.7209   19.76   440144.........   01.2961   17.79   450047.........   01.1070   11.09   450155.........   01.0382   24.42
    420089.......................   01.2826   21.79   440018..........   01.3665   16.68   440145.........   00.9607   13.88   450050.........   00.9968   11.53   450157.........   01.1365   15.32
    420091.......................   01.2793   16.06   440019..........   01.6964   20.11   440147.........   01.5847   16.28   450051.........   01.6355   19.77   450160.........   00.9535   15.51
    420093.......................   01.0268  .......  440020..........   01.2407   15.60   440148.........   01.1655   16.26   450052.........   01.0576   13.42   450162.........   01.2604   21.24
    430004.......................   01.1554   16.77   440023..........   01.1507   14.25   440149.........   01.1555   14.35   450053.........   01.0823   14.15   450163.........   01.0682   16.72
    430005.......................   01.3595   15.32   440024..........   01.3297   17.96   440150.........   01.3246   18.41   450054.........   01.6306   21.89   450164.........   01.2194   14.62
    430007.......................   01.0638   13.91   440025..........   01.2064   13.85   440151.........   01.3017   17.69   450055.........   01.0921   12.18   450165.........   01.0931   13.25
    430008.......................   01.1481   16.06   440029..........   01.3155   17.57   440152.........   01.8871   18.01   450056.........   01.6523   16.13   450166.........   00.9365   10.68
    430010.......................   01.1348   14.54   440030..........   01.2445   13.96   440153.........   01.2219   16.01   450058.........   01.6081   16.97   450169.........   00.7896   12.56
    430011.......................   01.2481   15.59   440031..........   01.0365   13.97   440156.........   01.5838   22.45   450059.........   01.3520   13.67   450170.........   00.9586   11.25
    430012.......................   01.3134   16.94   440032..........   01.0487   14.25   440157.........   01.0574   15.33   450063.........   00.9136   12.64   450176.........   01.3488   14.31
    430013.......................   01.2626   16.44   440033..........   01.1447   11.81   440159.........   01.3462   13.80   450064.........   01.4496   15.32   450177.........   01.2792   13.51
    430014.......................   01.3447   18.19   440034..........   01.5652   19.30   440161.........   01.9004   19.94   450065.........   01.1111   19.22   450178.........   00.9692   13.80
    430015.......................   01.1468   16.06   440035..........   01.2851   17.56   440166.........   01.6175   18.67   450068.........   01.8913   24.40   450181.........   01.0425   19.19
    430016.......................   01.8285   18.86   440039..........   01.7990   18.40   440168.........   01.0818   16.29   450072.........   01.2252   19.03   450184.........   01.5030   23.29
    430018.......................   00.9273   14.23   440040..........   01.0268   14.47   440173.........   01.6639   17.92   450073.........   01.2014   18.74   450185.........   01.0475   10.84
    430022.......................   00.9234   11.69   440041..........   01.0192   12.50   440174.........   01.0421   15.12   450076.........   01.6720  .......  450187.........   01.2512   19.67
    430023.......................   00.9009   11.59   440046..........   01.2308   14.28   440175.........   01.1542   17.31   450078.........   00.9841   09.74   450188.........   01.0367   14.02
    430024.......................   01.0343   14.51   440047..........   00.9274   16.03   440176.........   01.4262   19.42   450079.........   01.4681   20.51   450191.........   01.0301   19.15
    430027.......................   01.7770   18.58   440048..........   01.8485   16.82   440178.........   01.2426   22.63   450080.........   01.2200   17.44   450192.........   01.2312   17.99
    430028.......................   01.0635   15.50   440049..........   01.6623   17.56   440180.........   01.2421   16.19   450081.........   01.0655   15.61   450193.........   02.0166   22.67
    430029.......................   01.0237   15.69   440050..........   01.3806   16.99   440181.........   01.0545   10.98   450082.........   01.0038   13.31   450194.........   01.2934   20.99
    430031.......................   00.9251   12.23   440051..........   00.9613   14.08   440182.........   00.9998   16.20   450083.........   01.7323   19.48   450196.........   01.4438   17.07
    430033.......................   00.9805   13.99   440052..........   01.1465   15.14   440183.........   01.5912   20.71   450085.........   01.0847   12.24   450200.........   01.4043   14.95
    430034.......................   01.0590   12.76   440053..........   01.3823   17.37   440184.........   01.3803   19.32   450087.........   01.4908   17.64   450201.........   01.0004   17.33
    430036.......................   01.0975   12.56   440054..........   01.1902   13.52   440185.........   01.2481   18.83   450090.........   01.2450   13.44   450203.........   01.2382   18.28
    430037.......................   00.8770   14.57   440056..........   01.1204   14.40   440186.........   01.0953   17.87   450092.........   01.2228   12.47   450209.........   01.5951   18.25
    430038.......................   00.9865   11.26   440057..........   01.0459   12.35   440187.........   01.2081   15.76   450094.........   01.3052  .......  450210.........   01.1066   13.17
    430040.......................   01.0299   13.59   440058..........   01.2301   15.98   440189.........   01.5755   18.56   450096.........   01.4605   16.91   450211.........   01.3831   16.37
    430041.......................   00.9403   14.87   440059..........   01.3550   13.94   440192.........   01.2296   16.54   450097.........   01.4472   18.03   450213.........   01.6843   16.75
    430043.......................   01.1676   12.87   440060..........   01.2762   16.56   440193.........   01.2803   17.93   450098.........   01.1799   16.58   450214.........   01.3531   19.24
    430044.......................   00.8239   16.48   440061..........   01.2361   17.43   440194.........   01.2787   22.50   450099.........   01.2415   17.53   450217.........   01.0704   11.12
    430047.......................   01.0575   14.80   440063..........   01.6979   18.02   440197.........   01.3863   19.25   450101.........   01.4681   16.40   450219.........   01.1743   12.93
    430048.......................   01.2187   17.49   440064..........   01.1639   17.44   440200.........   01.1095   16.93   450102.........   01.7052   17.78   450221.........   01.2410   19.52
    430049.......................   00.8976   13.24   440065..........   01.2574   19.20   440203.........   00.9488   14.18   450104.........   01.1807   14.62   450222.........   01.5738   17.18
    430051.......................   00.9900   16.00   440067..........   01.2538   17.02   440205.........   01.1295   14.78   450107.........   01.6561   19.78   450224.........   01.3931   21.57
    430054.......................   01.0254   13.60   440068..........   01.2810   17.51   440206.........   01.0269   17.93   450108.........   00.9943   13.51   450229.........   01.6431   15.88
    430056.......................   00.8484   13.33   440070..........   01.0737   15.47   440210.........   00.8638  .......  450109.........   00.9201   14.10   450231.........   01.6402   17.02
    430057.......................   00.8887   13.52   440071..........   01.3827   15.29   440211.........   00.8634  .......  450110.........   01.3519   18.61   450234.........   01.0158   11.70
    430060.......................   00.9648   09.05   440072..........   01.4283   17.03   450002.........   01.5007   16.67   450111.........   01.2674   19.21   450235.........   01.0278   13.81
    430064.......................   01.1062   13.30   440073..........   01.3083   18.15   450004.........   01.1706   13.46   450112.........   01.3283   14.83   450236.........   01.1414   12.89
    430066.......................   00.9328   12.75   440078..........   01.0126   12.13   450005.........   01.2847   14.90   450113.........   01.2951   16.69   450237.........   01.5569   16.22
    430073.......................   01.0259   15.30   440081..........   01.1637   14.99   450007.........   01.2371   18.19   450118.........   01.5992   18.24   450239.........   01.0932   16.23
    430076.......................   00.9397   11.72   440082..........   02.0438   21.84   450008.........   01.3035   15.35   450119.........   01.4448   19.05   450241.........   00.9370   17.05
    430077.......................   01.6490   17.05   440083..........   01.1524   12.07   450010.........   01.3484   15.69   450121.........   01.5409   18.89   450243.........   00.9835   11.45
    430079.......................   00.9894   13.32   440084..........   01.1534   13.82   450011.........   01.5105   16.02   450123.........   01.1160   18.35   450249.........   00.9517   10.86
    430081.......................   00.8564  .......  440091..........   01.6220   18.42   450014.........   01.0623   15.48   450124.........   01.7023   18.45   450250.........   00.9991   15.66
    430082.......................   00.9185  .......  440100..........   01.0732   14.88   450015.........   01.6551   16.86   450126.........   01.4337   17.01   450253.........   01.1681   12.65
    430083.......................   00.7926  .......  440102..........   01.1389   13.79   450016.........   01.5914   18.01   450128.........   01.2114   13.18   450258.........   01.0492   12.74
    430084.......................   00.8631  .......  440103..........   01.2114   17.04   450018.........   01.4744   20.02   450130.........   01.4736   18.04   450264.........   00.8597   15.18
    430085.......................   00.8586  .......  440104..........   01.6329   18.95   450020.........   00.9726   16.92   450131.........   01.2712   20.21   450269.........   01.0555   15.78
    430087.......................   00.7737   10.24   440105..........   01.5362   15.40   450021.........   01.8369   20.79   450132.........   01.6805   17.53   450270.........   01.2103   11.06
    430089.......................   00.8702  .......  440109..........   01.1650   13.89   450023.........   01.4090   17.41   450133.........   01.6198   14.09   450271.........   01.2446   15.37
    430090.......................   01.6368  .......  440110..........   01.0533   16.25   450024.........   01.3806   17.30   450135.........   01.6577   19.58   450272.........   01.3032   15.86
    430091.......................   01.2774  .......  440111..........   01.3627   20.00   450025.........   01.4884   16.75   450137.........   01.5282   21.67   450276.........   01.0699   12.98
    440001.......................   01.1359   14.55   440114..........   01.0912   14.77   450028.........   01.5646   18.21   450140.........   00.9498   11.63   450278.........   00.9644   12.52
    440002.......................   01.6162   17.64   440115..........   01.0532   15.54   450029.........   01.5963   15.23   450143.........   00.9918   12.21   450280.........   01.5125   18.38
    440003.......................   01.2559   17.39   440120..........   01.5957   18.89   450031.........   01.4996   18.63   450144.........   01.0331   12.01   450283.........   01.0389   12.79
    440006.......................   01.4841   18.92   440125..........   01.5453   18.50   450032.........   01.3522   13.79   450145.........   00.8532   14.34   450288.........   01.1750   15.16
    440007.......................   01.0194   10.84   440130..........   01.1768   14.86   450033.........   01.6513   17.18   450146.........   01.0084   23.62   450289.........   01.4006   17.39
    440008.......................   00.9915   14.52   440131..........   01.1562   14.49   450034.........   01.6287   18.76   450147.........   01.3928   16.89   450292.........   01.1576   19.69
    440009.......................   01.2565   14.35   440132..........   01.1233   13.67   450035.........   01.4187   19.20   450148.........   01.2800   19.65   450293.........   00.9323   12.72
    440010.......................   00.9659   12.64   440133..........   01.5603   19.98   450037.........   01.6096   18.97   450149.........   01.5185   19.99   450296.........   01.4152   19.20
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25635]]
    
    
                                                                                              Page 14 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    450299.......................   01.4072   17.64   450508..........   01.3603   17.56   450666.........   01.3312   17.90   450795.........   01.1350   11.54   470023.........   01.2895   20.23
    450303.......................   01.0154   09.91   450514..........   01.1700   21.10   450668.........   01.5943   20.06   450796.........   01.1114   18.43   470024.........   01.1727   19.52
    450306.......................   01.3057   13.64   450517..........   00.9399   10.56   450669.........   01.4186   18.58   450797.........   00.6077   20.39   490001.........   01.1946   22.18
    450307.......................   00.8801   14.50   450518..........   01.5820   18.69   450670.........   01.3482   19.53   450798.........   00.8050   13.86   490002.........   01.1337   13.48
    450309.......................   01.0743   11.89   450523..........   01.5399   20.21   450672.........   01.6957   15.51   450801.........   01.4763   15.51   490003.........   00.6057   17.48
    450315.......................   01.0586   19.19   450530..........   01.2367   14.42   450673.........   01.0679   13.71   450802.........   01.3938   21.70   490004.........   01.2252   17.71
    450320.......................   01.2414   18.72   450534..........   00.9886   15.40   450674.........   01.2022   19.92   450803.........   00.9037   14.23   490005.........   01.5926   15.95
    450321.......................   00.9614   13.82   450535..........   01.2414   21.39   450675.........   01.4594   18.09   450804.........   01.7378   18.83   490006.........   01.1499   14.40
    450322.......................   00.6639   17.10   450537..........   01.3383   20.33   450677.........   01.3331   18.92   450807.........   00.8978   09.72   490007.........   02.0606   17.85
    450324.......................   01.6384   16.95   450539..........   01.4022   16.04   450678.........   01.4407   20.79   450808.........   01.2265   20.55   490009.........   01.9210   21.78
    450327.......................   01.0202   15.94   450544..........   01.2272   18.82   450683.........   01.3459   16.70   450809.........   01.6064   11.29   490010.........   01.1786   18.22
    450330.......................   01.1889   17.95   450545..........   01.2791   10.16   450684.........   01.2082   18.70   450810.........   00.9015  .......  490011.........   01.4566   17.62
    450334.......................   01.0427   12.16   450547..........   01.1421   14.03   450686.........   01.5023   14.59   450811.........   02.1718  .......  490012.........   01.2121   13.77
    450337.......................   01.1368   15.71   450551..........   01.0935   11.37   450688.........   01.3506   18.63   450812.........   01.4107  .......  490013.........   01.2228   16.47
    450340.......................   01.4648   13.10   450558..........   01.8402   18.19   450690.........   01.4263   17.85   450813.........   00.9625  .......  490014.........   01.5159   22.68
    450341.......................   01.0639   17.56   450561..........   01.6276   17.05   450694.........   01.1099   20.41   460001.........   01.7571   20.72   490015.........   01.4427   21.35
    450346.......................   01.5308   16.52   450563..........   01.2546   26.74   450696.........   01.8786   18.73   460003.........   01.6596   13.31   490017.........   01.3665   14.05
    450347.......................   01.1688   17.43   450565..........   01.2517   16.37   450697.........   01.5484   15.64   460004.........   01.7671   21.27   490018.........   01.3418   17.01
    450348.......................   01.0269   11.60   450570..........   01.0924   15.62   450698.........   00.9596   13.36   460005.........   01.6688   17.23   490019.........   01.2321   16.49
    450351.......................   01.2346   20.05   450571..........   01.4622   16.04   450700.........   01.0540   13.52   460006.........   01.3436   19.96   490020.........   01.2247   16.07
    450352.......................   01.2368   17.88   450573..........   01.0277   13.94   450702.........   01.5379   17.73   460007.........   01.4903   20.38   490021.........   01.3831   18.08
    450353.......................   01.2532   18.38   450574..........   00.9377   11.77   450703.........   01.5073   10.03   460008.........   01.4270   16.77   490022.........   01.4805   20.25
    450355.......................   01.1328   14.56   450575..........   01.0523   17.94   450704.........   01.3187   18.39   460009.........   01.8533   20.44   490023.........   01.2675   18.77
    450358.......................   02.0759   22.13   450578..........   00.9641   14.60   450705.........   00.8680   17.81   460010.........   02.0765   21.33   490024.........   01.8219   17.17
    450362.......................   01.0834   14.11   450580..........   01.1420   14.05   450706.........   01.3743   20.77   460011.........   01.4411   15.69   490027.........   01.1416   14.52
    450369.......................   01.0290   11.76   450583..........   01.0040   11.81   450709.........   01.2530   18.28   460013.........   01.4727   18.36   490030.........   01.1740   11.44
    450370.......................   01.1810   09.42   450584..........   01.1354   12.88   450711.........   01.6382   26.65   460014.........   01.3196   16.46   490031.........   01.1290   13.85
    450371.......................   01.3147   12.05   450586..........   01.0874   12.54   450712.........   00.7382   11.77   460015.........   01.2639   19.92   490032.........   01.7735   19.88
    450372.......................   01.2321   21.35   450587..........   01.2170   17.55   450713.........   01.5244   20.73   460016.........   00.9270   16.64   490033.........   01.1962   17.39
    450373.......................   01.1823   18.71   450591..........   01.2310   17.41   450715.........   01.4406   18.46   460017.........   01.4957   17.56   490035.........   01.0236   07.57
    450374.......................   00.9860   12.21   450596..........   01.3163   18.97   450716.........   01.3997   19.33   460018.........   00.9784   16.10   490037.........   01.1888   14.88
    450378.......................   01.0667   21.41   450597..........   01.0268   13.68   450717.........   01.3232   22.11   460019.........   01.1733   16.25   490038.........   01.2703   14.98
    450379.......................   01.5480   20.94   450603..........   00.7219   14.21   450718.........   01.2781   17.49   460020.........   00.9866   17.05   490040.........   01.4415   21.70
    450381.......................   01.0325   13.87   450604..........   01.3496   14.64   450723.........   01.4075   18.75   460021.........   01.3876   20.12   490041.........   01.2682   16.01
    450388.......................   01.8150   15.21   450605..........   01.2166   16.69   450724.........   01.3091   18.28   460022.........   00.9246   18.19   490042.........   01.3042   16.38
    450389.......................   01.2994   14.80   450609..........   00.8719   12.26   450725.........   01.0043   19.85   460023.........   01.2160   20.38   490043.........   01.3803   19.82
    450393.......................   01.3200   11.86   450610..........   01.4645   18.06   450727.........   01.0811   16.87   460025.........   00.8007   20.08   490044.........   01.3514   17.17
    450395.......................   01.0597   16.54   450614..........   01.0531   12.79   450728.........   00.8837   07.46   460026.........   01.0552   17.32   490045.........   01.2228   19.98
    450399.......................   00.9655   11.15   450615..........   01.1326   12.36   450730.........   01.2614   21.03   460027.........   00.8883   20.44   490046.........   01.5215   17.89
    450400.......................   01.1933   13.63   450617..........   01.3492   19.91   450733.........   01.6021   15.09   460029.........   01.0308   17.00   490047.........   01.1505   16.65
    450403.......................   01.3197   19.63   450620..........   01.1109   12.27   450735.........   00.9833   13.78   460030.........   01.1423   16.55   490048.........   01.5931   17.94
    450411.......................   00.9264   13.09   450623..........   01.2008   18.97   450742.........   01.2757   20.17   460032.........   01.0597   19.39   490050.........   01.4805   20.95
    450417.......................   01.2299   15.17   450626..........   01.0125   16.38   450743.........   01.4277   17.77   460033.........   00.9172   17.19   490052.........   01.6347   16.26
    450418.......................   01.4876   21.54   450628..........   00.9890   17.19   450746.........   01.0074   14.71   460035.........   00.9441   12.43   490053.........   01.3129   15.12
    450419.......................   01.2224   20.33   450630..........   01.6105   19.66   450747.........   01.3436   17.58   460036.........   01.0266   20.56   490054.........   01.0153   15.45
    450422.......................   00.8593   25.07   450631..........   01.6903   13.59   450749.........   00.9909   14.54   460037.........   00.9572   18.38   490057.........   01.5481   18.87
    450423.......................   01.4768   22.62   450632..........   01.0398   11.43   450750.........   01.0134   12.54   460039.........   01.0909   23.84   490059.........   01.6281   19.99
    450424.......................   01.2921   16.39   450633..........   01.5622   12.13   450751.........   01.3102   19.24   460041.........   01.3319   20.51   490060.........   01.1169   18.19
    450429.......................   01.0852   12.33   450634..........   01.7215   23.78   450754.........   00.9192   13.20   460042.........   01.4554   14.11   490063.........   01.7955   23.28
    450431.......................   01.6026   18.46   450638..........   01.5546   25.20   450755.........   01.1391   17.26   460043.........   00.9829   21.91   490066.........   01.2905   20.77
    450438.......................   01.2764   13.12   450639..........   01.4457   23.25   450757.........   00.9009   13.23   460044.........   01.1823   20.42   490067.........   01.2750   16.60
    450446.......................   00.7248   15.16   450641..........   01.0829   17.56   450758.........   01.9407   19.90   460046.........   01.9599   17.71   490069.........   01.4205   14.56
    450447.......................   01.3800   17.19   450643..........   01.2095   15.10   450760.........   01.2017   18.55   460047.........   01.7392   19.91   490071.........   01.4266   17.71
    450451.......................   01.1660   15.20   450644..........   01.5151   18.19   450761.........   01.0213   11.87   460049.........   02.0096   19.97   490073.........   01.4914   22.82
    450457.......................   01.7808   18.77   450646..........   01.5429   20.32   450763.........   00.9975   17.58   460050.........   01.3199   19.33   490074.........   01.4074   17.39
    450460.......................   01.0157   12.81   450647..........   01.9096   20.84   450766.........   02.0886   21.59   460051.........   01.2227   13.29   490075.........   01.4408   18.79
    450462.......................   01.7455   16.26   450648..........   00.9381   12.65   450769.........   00.8730   11.77   470001.........   01.2556   20.25   490077.........   01.2421   19.03
    450464.......................   01.0024   12.89   450649..........   00.9870   14.53   450770.........   01.0213   15.47   470003.........   01.8563   19.92   490079.........   01.3591   15.64
    450465.......................   01.3399   15.41   450651..........   01.7586   19.35   450771.........   01.7967   16.42   470004.........   01.1211   15.87   490084.........   01.2514   16.34
    450467.......................   00.9850   17.15   450652..........   00.8798   14.52   450774.........   01.6108   20.17   470005.........   01.2357   21.12   490085.........   01.2505   15.31
    450469.......................   01.4058   19.15   450653..........   01.1829   16.63   450775.........   01.3187   41.14   470006.........   01.2066   17.97   490088.........   01.1793   16.50
    450473.......................   01.0205   14.61   450654..........   00.9596   10.61   450776.........   00.9848   10.16   470008.........   01.2542   17.91   490089.........   01.1277   16.41
    450475.......................   01.1210   13.56   450656..........   01.4624   18.35   450777.........   00.9836   16.72   470010.........   01.1439   19.71   490090.........   01.1658   16.31
    450484.......................   01.4951   19.64   450658..........   00.9767   12.49   450779.........   01.2890   22.50   470011.........   01.1753   20.37   490091.........   01.2201   19.80
    450488.......................   01.3238   17.72   450659..........   01.5010   21.19   450780.........   01.6074   16.21   470012.........   01.2872   18.28   490092.........   01.2429   15.01
    450489.......................   01.0359   13.90   450661..........   01.1973   21.13   450785.........   00.9638   18.31   470015.........   01.1589   19.34   490093.........   01.3892   15.78
    450497.......................   01.1631   14.82   450662..........   01.6029   16.56   450788.........   01.5172   16.06   470018.........   01.2011   20.89   490094.........   01.1193   16.40
    450498.......................   00.9818   12.66   450665..........   00.9015   13.23   450794.........   01.4587   16.66   470020.........   00.9543   16.28   490095.........   01.4744   17.31
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25636]]
    
    
                                                                                              Page 15 of 15                                                                                         
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Avg.                                 Avg.                                Avg.                                Avg.                               Avg. 
               Provider            Case mix    hour       Provider      Case mix    hour       Provider     Case mix    hour       Provider     Case mix    hour       Provider     Case mix   hour 
                                     index     wage                       index     wage                      index     wage                      index     wage                      index    wage 
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    490097.......................   01.2401   15.08   500055..........   01.1102   22.34   510030.........   01.0609   15.76   520045.........   01.6699   18.60   520144.........   01.0176   16.36
    490098.......................   01.2771   13.23   500057..........   01.2911   17.73   510031.........   01.4605   16.76   520047.........   00.9944   17.42   520145.........   00.9470   16.85
    490099.......................   00.9704   16.66   500058..........   01.5107   21.64   510033.........   01.3690   16.31   520048.........   01.4624   18.04   520146.........   01.0694   15.76
    490100.......................   01.5522   18.36   500059..........   01.0873   22.72   510035.........   01.3504   18.82   520049.........   01.9631   19.12   520148.........   01.1567   16.73
    490101.......................   01.2218   23.44   500060..........   01.4688   23.67   510036.........   01.0367   12.45   520051.........   01.8043   15.77   520149.........   00.9333   12.72
    490104.......................   00.8484   21.14   500061..........   01.0054   20.43   510038.........   01.1249   14.36   520053.........   01.1564   15.87   520151.........   01.0435   16.58
    490105.......................   00.5902   30.04   500062..........   01.1028   19.07   510039.........   01.3356   15.69   520054.........   01.0412   19.44   520152.........   01.1259   17.97
    490106.......................   00.8464   21.07   500064..........   01.6849   24.85   510043.........   00.9429   14.14   520057.........   01.1771   18.10   520153.........   00.9590   14.95
    490107.......................   01.3556   22.35   500065..........   01.2258   20.87   510046.........   01.3048   17.25   520058.........   01.1268   20.40   520154.........   01.1615   18.07
    490108.......................   00.9494   19.84   500068..........   01.0622   18.61   510047.........   01.2964   18.83   520059.........   01.3542   19.76   520156.........   01.1721   19.10
    490109.......................   00.9167   20.38   500069..........   01.1722   19.05   510048.........   01.1292   18.03   520060.........   01.4225   17.08   520157.........   01.0942   15.30
    490110.......................   01.3455   15.76   500071..........   01.3952   20.91   510050.........   01.6030   16.38   520062.........   01.3120   17.21   520159.........   00.9415   19.52
    490111.......................   01.2018   15.96   500072..........   01.2463   24.49   510053.........   01.0108   14.63   520063.........   01.2008   19.95   520160.........   01.7765   19.26
    490112.......................   01.6587   19.70   500073..........   01.0093   18.07   510055.........   01.2826   22.31   520064.........   01.5671   20.70   520161.........   01.0404   17.96
    490113.......................   01.2995   22.73   500074..........   01.0970   18.46   510058.........   01.2636   17.21   520066.........   01.5292   19.84   520170.........   01.2542   21.23
    490114.......................   01.1138   15.90   500077..........   01.3337   22.82   510059.........   02.4160   15.98   520068.........   00.9889   18.59   520171.........   00.9070   14.86
    490115.......................   01.1964   16.62   500079..........   01.3407   21.42   510060.........   01.0691   15.10   520069.........   01.1861   18.14   520173.........   01.1585   19.58
    490116.......................   01.1887   16.24   500080..........   00.8399   13.35   510061.........   01.0314   13.59   520070.........   01.5734   17.44   520177.........   01.6324   19.38
    490117.......................   01.1938   10.57   500084..........   01.2536   21.57   510062.........   01.2784   17.15   520071.........   01.2420   18.44   520178.........   01.1172   16.98
    490118.......................   01.7261   20.56   500085..........   01.0506   18.46   510066.........   01.1573   13.24   520074.........   01.0372   16.81   520187.........   00.2986  ......
    490119.......................   01.4062   17.02   500086..........   01.3459   21.47   510067.........   01.1882   16.39   520075.........   01.4602   18.96   530002.........   01.2253   21.84
    490120.......................   01.3763   17.93   500088..........   01.3211   23.74   510068.........   01.1347   15.46   520076.........   01.1673   16.36   530003.........   00.8835   14.70
    490122.......................   01.4040   22.46   500089..........   01.0985   16.55   510070.........   01.3876   15.31   520077.........   00.9774   14.51   530004.........   00.9574   14.14
    490123.......................   01.1230   15.45   500090..........   00.9182   14.04   510071.........   01.3472   15.76   520078.........   01.6274   18.24   530005.........   01.0465   14.61
    490124.......................   01.1222   15.81   500092..........   00.9896   19.29   510072.........   01.0515   13.30   520082.........   01.2908   17.60   530006.........   01.1196   20.18
    490126.......................   01.4055   16.47   500094..........   00.9176   17.96   510077.........   01.1535   15.63   520083.........   01.7091   21.38   530007.........   01.1095   14.87
    490127.......................   01.0287   16.05   500096..........   01.0080   18.80   510080.........   01.2046   16.32   520084.........   01.0866   17.62   530008.........   01.2996   13.79
    490129.......................   01.0607   23.65   500097..........   01.1573   19.47   510081.........   01.1996   13.50   520087.........   01.7203   18.61   530009.........   00.9922   18.12
    490130.......................   01.2347   15.72   500098..........   01.0903   14.96   510082.........   01.2149   13.50   520088.........   01.2637   18.97   530010.........   01.2158   18.65
    490132.......................   01.0026  .......  500101..........   00.9755   19.08   510084.........   00.9664   12.91   520089.........   01.4904   20.44   530011.........   01.1586   17.22
    500001.......................   01.4111   21.97   500102..........   00.9657   20.71   510085.........   01.3282   17.98   520090.........   01.2889   17.51   530012.........   01.5605   18.08
    500002.......................   01.4114   21.64   500104..........   01.1802   22.63   510086.........   01.1820   13.59   520091.........   01.3199   19.68   530014.........   01.4027   19.27
    500003.......................   01.4119   24.03   500106..........   00.9602   19.85   520002.........   01.2720   18.86   520092.........   01.1556   16.83   530015.........   01.2690   19.02
    500005.......................   01.8033   21.24   500107..........   01.2297   16.68   520003.........   01.0633   15.78   520094.........   00.7870   19.19   530016.........   01.2999   17.19
    500007.......................   01.3070   23.24   500108..........   01.7227   20.48   520004.........   01.1862   18.46   520095.........   01.3843   19.38   530017.........   00.8709   15.80
    500008.......................   01.9296   25.09   500110..........   01.1878   20.80   520006.........   01.0492   20.59   520096.........   01.3993   18.60   530018.........   01.0972   16.71
    500011.......................   01.3263   22.98   500118..........   01.1808   22.66   520007.........   01.0781   14.87   520097.........   01.2965   19.05   530019.........   01.0350   11.26
    500012.......................   01.5418   22.34   500119..........   01.3050   21.86   520008.........   01.6437   22.59   520098.........   01.8306   20.96   530022.........   01.1106   17.60
    500014.......................   01.5358   22.94   500122..........   01.2794   22.76   520009.........   01.6467   18.07   520100.........   01.2826   18.08   530023.........   00.8946   19.55
    500015.......................   01.4382   22.41   500123..........   00.8946   16.33   520010.........   01.2081   20.01   520101.........   01.0947   17.84   530025.........   01.2196   21.13
    500016.......................   01.5256   24.13   500124..........   01.3290   23.72   520011.........   01.2493   19.33   520102.........   01.1586   09.85   530026.........   01.1680   21.55
    500019.......................   01.3845   22.33   500125..........   01.1430   15.98   520013.........   01.3654   19.29   520103.........   01.3295   18.39   530027.........   00.9464   32.50
    500021.......................   01.4791   18.72   500129..........   01.7655   23.34   520014.........   01.1483   16.47   520107.........   01.3313   18.69   530029.........   01.0347   14.86
    500023.......................   01.2237   21.48   500132..........   00.9488   17.26   520015.........   01.1656   17.59   520109.........   00.9890   18.27   530031.........   00.8621   18.36
    500024.......................   01.6929   25.17   500134..........   00.5730   17.47   520016.........   01.1202   12.53   520110.........   01.2401   18.59   530032.........   01.0887   20.69
    500025.......................   01.8624   25.48   500138..........   06.3328  .......  520017.........   01.1603   18.49   520111.........   00.9933   17.44                                    
    500026.......................   01.4298   24.13   500139..........   01.4946   20.62   520018.........   01.1396   17.51   520112.........   01.1309   17.67                                    
    500027.......................   01.6083   25.89   500141..........   01.3409   22.31   520019.........   01.3102   19.27   520113.........   01.2560   19.14                                    
    500028.......................   01.1018   17.84   500143..........   00.5980   15.77   520021.........   01.3145   19.71   520114.........   01.1466   15.59                                    
    500029.......................   00.9778   17.28   500146..........   01.1943   17.52   520024.........   01.1085   13.94   520115.........   01.2493   17.57                                    
    500030.......................   01.4685   23.64   510001..........   01.8062   18.22   520025.........   01.1185   16.59   520116.........   01.2386   19.24                                    
    500031.......................   01.3076   22.42   510002..........   01.3476   17.07   520026.........   01.0738   18.95   520117.........   01.0212   17.30                                    
    500033.......................   01.3568   20.98   510005..........   00.9799   14.53   520027.........   01.2317   20.05   520118.........   00.8786   12.73                                    
    500036.......................   01.3789   20.93   510006..........   01.2876   17.40   520028.........   01.4023   20.17   520120.........   00.8917   16.22                                    
    500037.......................   01.1777   20.35   510007..........   01.5321   19.91   520029.........   00.9252   17.80   520121.........   00.9810   16.30                                    
    500039.......................   01.3856   22.97   510008..........   01.2363   16.30   520030.........   01.6637   20.22   520122.........   01.0140   16.52                                    
    500041.......................   01.2891   24.11   510012..........   01.0194   15.51   520031.........   01.1181   15.70   520123.........   01.0617   17.45                                    
    500042.......................   01.4113   21.93   510013..........   01.1629   16.85   520032.........   01.1645   16.87   520124.........   01.0920   16.50                                    
    500043.......................   01.0687   19.43   510015..........   01.0179   13.81   520033.........   01.2055   17.42   520130.........   01.0256   14.89                                    
    500044.......................   01.9209   23.59   510018..........   01.1368   14.07   520034.........   01.0827   17.18   520131.........   01.0431   17.56                                    
    500045.......................   01.0517   22.10   510020..........   01.0662   12.22   520035.........   01.3492   17.15   520132.........   01.1994   17.01                                    
    500048.......................   00.9665   19.03   510022..........   01.8733   19.32   520037.........   01.6601   19.33   520134.........   01.0791   16.37                                    
    500049.......................   01.5515   22.21   510023..........   01.2461   15.36   520038.........   01.3396   17.69   520135.........   00.9793   24.20                                    
    500050.......................   01.3757   20.94   510024..........   01.4907   18.04   520039.........   01.0178   18.09   520136.........   01.5411   19.31                                    
    500051.......................   01.6476   24.14   510026..........   01.0369   13.05   520040.........   01.4388   19.39   520138.........   01.8963   19.63                                    
    500052.......................   01.2052  .......  510027..........   00.9899   16.49   520041.........   01.1377   15.58   520139.........   01.2903   20.36                                    
    500053.......................   01.3356   21.20   510028..........   01.1102   14.91   520042.........   01.1067   17.13   520140.........   01.6170   19.69                                    
    500054.......................   01.8578   22.51   510029..........   01.2666   16.61   520044.........   01.4365   17.04   520142.........   00.8928   16.53                                    
    ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
    Note: Case mix indexes do not include discharges from PPS-exempt units.                                                                                                                         
    Case mix indexes include cases received in HCFA Central Office through December 1996.                                                                                                           
    
    
    [[Page 25637]]
    
    
    Table 4A.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
                                   Urban Areas                              
    ------------------------------------------------------------------------
                                                            Wage            
              Urban area (Constituent counties)             index      GAF  
    ------------------------------------------------------------------------
    0040  Abilene, TX...................................    0.8081    0.8642
      Taylor, TX                                                            
    0060  Aguadilla, PR.................................    0.4772    0.6025
      Aguada, PR                                                            
      Aguadilla, PR                                                         
      Moca, PR                                                              
    0080  Akron, OH.....................................    1.0011    1.0008
      Portage, OH                                                           
      Summit, OH                                                            
    0120  Albany, GA....................................    0.8098    0.8655
      Dougherty, GA                                                         
      Lee, GA                                                               
    0160  \2\ Albany-Schenectady-Troy, NY...............    0.8640    0.9047
      Albany, NY                                                            
      Montgomery, NY                                                        
      Rensselaer, NY                                                        
      Saratoga, NY                                                          
      Schenectady, NY                                                       
      Schoharie, NY                                                         
    0200  Albuquerque, NM...............................    0.8813    0.9171
      Bernalillo, NM                                                        
      Sandoval, NM                                                          
      Valencia, NM                                                          
    0220  Alexandria, LA................................    0.8598    0.9017
      Rapides, LA                                                           
    0240  Allentown-Bethlehem-Easton, PA................    1.0219    1.0149
      Carbon, PA                                                            
      Lehigh, PA                                                            
      Northampton, PA                                                       
    0280  Altoona, PA...................................    0.9398    0.9584
      Blair, PA                                                             
    0320  Amarillo, TX..................................    0.8483    0.8935
      Potter, TX                                                            
      Randall, TX                                                           
    0380  Anchorage, AK.................................    1.3088    1.2024
      Anchorage, AK                                                         
    0440  Ann Arbor, MI.................................    1.1127    1.0759
      Lenawee, MI                                                           
      Livingston, MI                                                        
      Washtenaw, MI                                                         
    0450  Anniston, AL..................................    0.8731    0.9113
      Calhoun, AL                                                           
    0460  Appleton-Oshkosh-Neenah, WI...................    0.8899    0.9232
      Calumet, WI                                                           
      Outagamie, WI                                                         
      Winnebago, WI                                                         
    0470  Arecibo, PR...................................    0.4915    0.6148
      Arecibo, PR                                                           
      Camuy, PR                                                             
      Hatillo, PR                                                           
    0480  Asheville, NC.................................    0.9016    0.9315
      Buncombe, NC                                                          
      Madison, NC                                                           
    0500  Athens, GA....................................    0.8746    0.9123
      Clarke, GA                                                            
      Madison, GA                                                           
      Oconee, GA                                                            
    0520  \1\ Atlanta, GA...............................    1.0024    1.0016
      Barrow, GA                                                            
      Bartow, GA                                                            
      Carroll, GA                                                           
      Cherokee, GA                                                          
      Clayton, GA                                                           
      Cobb, GA                                                              
      Coweta, GA                                                            
      DeKalb, 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                                                            
    0560  Atlantic-Cape May, NJ.........................    1.0442    1.0301
      Atlantic, NJ                                                          
      Cape May, NJ                                                          
    0600  Augusta-Aiken, GA-SC..........................    0.9309    0.9521
      Columbia, GA                                                          
      McDuffie, GA                                                          
      Richmond, GA                                                          
      Aiken, SC                                                             
      Edgefield, SC                                                         
    0640  \1\ Austin-San Marcos, TX.....................    0.8158    0.8699
      Bastrop, TX                                                           
      Caldwell, TX                                                          
      Hays, TX                                                              
      Travis, TX                                                            
      Williamson, TX                                                        
    0680  \2\ Bakersfield, CA...........................    0.9976    0.9984
      Kern, CA                                                              
    0720  \1\ Baltimore, MD.............................    0.9760    0.9835
      Anne Arundel, MD                                                      
      Baltimore, MD                                                         
      Baltimore City, MD                                                    
      Carroll, MD                                                           
      Harford, MD                                                           
      Howard, MD                                                            
      Queen Anne's, MD                                                      
    0733  \2\ Bangor, ME................................    0.8538    0.8974
      Penobscot, ME                                                         
    0743  Barnstable-Yarmouth, MA.......................    1.5644    1.3586
      Barnstable, MA                                                        
    0760  Baton Rouge, LA...............................    0.8940    0.9261
      Ascension, LA                                                         
      East Baton Rouge, LA                                                  
      Livingston, LA                                                        
      West Baton Rouge, LA                                                  
    0840  Beaumont-Port Arthur, TX......................    0.8660    0.9062
      Hardin, TX                                                            
      Jefferson, TX                                                         
      Orange, TX                                                            
    0860  Bellingham, WA................................    1.1475    1.0988
      Whatcom, WA                                                           
    0870  \2\ Benton Harbor, MI.........................    0.8988    0.9295
      Berrien, MI                                                           
    0875  \1\ Bergen-Passaic, NJ........................    1.1845    1.1229
      Bergen, NJ                                                            
      Passaic, NJ                                                           
    0880  Billings, MT..................................    0.9220    0.9459
      Yellowstone, MT                                                       
    0920  Biloxi-Gulfport-Pascagoula, MS................    0.8291    0.8796
      Hancock, MS                                                           
      Harrison, MS                                                          
      Jackson, MS                                                           
    0960  Binghamton, NY................................    0.9103    0.9377
      Broome, NY                                                            
      Tioga, NY                                                             
    1000  Birmingham, AL................................    0.9150    0.9410
      Blount, AL                                                            
      Jefferson, AL                                                         
      St. Clair, AL                                                         
      Shelby, AL                                                            
    1010  Bismarck, ND..................................    0.8015    0.8594
      Burleigh, ND                                                          
      Morton, ND                                                            
    1020  Bloomington, IN...............................    0.9041    0.9333
      Monroe, IN                                                            
    1040  Bloomington-Normal, IL........................    0.8926    0.9251
      McLean, IL                                                            
    1080  Boise City, ID................................    0.9267    0.9492
      Ada, ID                                                               
      Canyon, ID                                                            
    1123  \1\ \2\ Boston-Worcester-Lawrence-Lowell-                         
     Brockton, MA-NH (Massachusetts Hospitals)..........    1.0917    1.0619
      Bristol, MA                                                           
      Essex, MA                                                             
      Middlesex, MA                                                         
      Norfolk, MA                                                           
      Plymouth, MA                                                          
      Suffolk, MA                                                           
      Worcester, MA                                                         
      Hillsborough, NH                                                      
      Merrimack, NH                                                         
      Rockingham, NH                                                        
      Strafford, NH                                                         
    1123  \1\ Boston-Worcester-Lawrence-Lowell-Brockton,                    
     MA-NH (New Hampshire Hospitals)....................    1.0885    1.0598
      Bristol, MA                                                           
      Essex, MA                                                             
      Middlesex, MA                                                         
      Norfolk, MA                                                           
      Plymouth, MA                                                          
      Suffolk, MA                                                           
      Worcester, MA                                                         
      Hillsborough, NH                                                      
      Merrimack, NH                                                         
      Rockingham, NH                                                        
      Strafford, NH                                                         
    1125  Boulder-Longmont, CO..........................    1.0122    1.0083
      Boulder, CO                                                           
    1145  Brazoria, TX..................................    0.8895    0.9229
      Brazoria, TX                                                          
    1150  Bremerton, WA.................................    1.1148    1.0773
      Kitsap, WA                                                            
    1240  Brownsville-Harlingen-San Benito, TX..........    0.8291    0.8796
      Cameron, TX                                                           
    1260  Bryan-College Station, TX.....................    0.7962    0.8555
    
    [[Page 25638]]
    
                                                                            
      Brazos, TX                                                            
    1280  \1\ Buffalo-Niagara Falls, NY.................    0.9592    0.9719
      Erie, NY                                                              
      Niagara, NY                                                           
    1303  Burlington, VT................................    0.9612    0.9733
      Chittenden, VT                                                        
      Franklin, VT                                                          
      Grand Isle, VT                                                        
    1310  Caguas, PR....................................    0.4445    0.5739
      Caguas, PR                                                            
      Cayey, PR                                                             
      Cidra, PR                                                             
      Gurabo, PR                                                            
      San Lorenzo, PR                                                       
    1320  Canton-Massillon, OH..........................    0.8895    0.9229
      Carroll, OH                                                           
      Stark, OH                                                             
    1350  Casper, WY....................................    0.9227    0.9464
      Natrona, WY                                                           
    1360  Cedar Rapids, IA..............................    0.8888    0.9224
      Linn, IA                                                              
    1400  Champaign-Urbana, IL..........................    0.8844    0.9193
      Champaign, IL                                                         
    1440  Charleston-North Charleston, SC...............    0.8931    0.9255
      Berkeley, SC                                                          
      Charleston, SC                                                        
      Dorchester, SC                                                        
    1480  Charleston, WV................................    0.9042    0.9334
      Kanawha, WV                                                           
      Putnam, WV                                                            
    1520  \1\ Charlotte-Gastonia-Rock Hill, NC-SC.......    0.9568    0.9702
      Cabarrus, NC                                                          
      Gaston, NC                                                            
      Lincoln, NC                                                           
      Mecklenburg, NC                                                       
      Rowan, NC                                                             
      Stanly, NC                                                            
      Union, NC                                                             
      York, SC                                                              
    1540  Charlottesville, VA...........................    1.0359    1.0244
      Albemarle, VA                                                         
      Charlottesville City, VA                                              
      Fluvanna, VA                                                          
      Greene, VA                                                            
    1560  Chattanooga, TN-GA............................    0.9123    0.9391
      Catoosa, GA                                                           
      Dade, GA                                                              
      Walker, GA                                                            
      Hamilton, TN                                                          
      Marion, TN                                                            
    1580  Cheyenne, WY..................................    0.9354    0.9553
      Laramie, WY                                                           
    1600  \1\ Chicago, IL...............................    1.0507    1.0344
      Cook, IL                                                              
      DeKalb, IL                                                            
      DuPage, IL                                                            
      Grundy, IL                                                            
      Kane, IL                                                              
      Kendall, IL                                                           
      Lake, IL                                                              
      McHenry, IL                                                           
      Will, IL                                                              
    1620  Chico-Paradise, CA............................    1.0231    1.0158
      Butte, CA                                                             
    1640  \1\ Cincinnati, OH-KY-IN......................    0.9465    0.9630
      Dearborn, IN                                                          
      Ohio, IN                                                              
      Boone, KY                                                             
      Campbell, KY                                                          
      Gallatin, KY                                                          
      Grant, KY                                                             
      Kenton, KY                                                            
      Pendleton, KY                                                         
      Brown, OH                                                             
      Clermont, OH                                                          
      Hamilton, OH                                                          
      Warren, OH                                                            
    1660  Clarksville-Hopkinsville, TN-KY...............    0.8204    0.8732
      Christian, KY                                                         
      Montgomery, TN                                                        
    1680  \1\ Cleveland-Lorain-Elyria, OH...............    0.9970    0.9979
      Ashtabula, OH                                                         
      Cuyahoga, OH                                                          
      Geauga, OH                                                            
      Lake, OH                                                              
      Lorain, OH                                                            
      Medina, OH                                                            
    1720  Colorado Springs, CO..........................    0.9469    0.9633
      El Paso, CO                                                           
    1740  Columbia, MO..................................    0.9678    0.9778
      Boone, MO                                                             
    1760  Columbia, SC..................................    0.9368    0.9563
      Lexington, SC                                                         
      Richland, SC                                                          
    1800  Columbus, GA-AL...............................    0.8573    0.8999
      Russell, AL                                                           
      Chattahoochee, GA                                                     
      Harris, GA                                                            
      Muscogee, GA                                                          
    1840  \1\ Columbus, OH..............................    0.9929    0.9951
      Delaware, OH                                                          
      Fairfield, OH                                                         
      Franklin, OH                                                          
      Licking, OH                                                           
      Madison, OH                                                           
      Pickaway, OH                                                          
    1880  Corpus Christi, TX............................    0.8112    0.8665
      Nueces, TX                                                            
      San Patricio, TX                                                      
    1900  \2\ Cumberland, MD-WV (Maryland Hospitals)....    0.8627    0.9038
      Allegany, MD                                                          
      Mineral, WV                                                           
    1900  Cumberland, MD-WV (West Virginia Hospital)....    0.8407    0.8880
      Allegany, MD                                                          
      Mineral, WV                                                           
    1920  \1\ Dallas, TX................................    0.9149    0.9409
      Collin, TX                                                            
      Dallas, TX                                                            
      Denton, TX                                                            
      Ellis, TX                                                             
      Henderson, TX                                                         
      Hunt, TX                                                              
      Kaufman, TX                                                           
      Rockwall, TX                                                          
    1950  Danville, VA..................................    0.9121    0.9389
      Danville City, VA                                                     
      Pittsylvania, VA                                                      
    1960  Davenport-Moline-Rock Island, IA-IL...........    0.8496    0.8944
      Scott, IA                                                             
      Henry, IL                                                             
      Rock Island, IL                                                       
    2000  Dayton-Springfield, OH........................    0.9670    0.9773
      Clark, OH                                                             
      Greene, OH                                                            
      Miami, OH                                                             
      Montgomery, OH                                                        
    2020  Daytona Beach, FL.............................    0.9211    0.9453
      Flagler, FL                                                           
      Volusia, FL                                                           
    2030  Decatur, AL...................................    0.8302    0.8804
      Lawrence, AL                                                          
      Morgan, AL                                                            
    2040  Decatur, IL...................................    0.8140    0.8686
      Macon, IL                                                             
    2080  \1\ Denver, CO................................    1.0532    1.0361
      Adams, CO                                                             
      Arapahoe, CO                                                          
      Denver, CO                                                            
      Douglas, CO                                                           
      Jefferson, CO                                                         
    2120  Des Moines, IA................................    0.8576    0.9001
      Dallas, IA                                                            
      Polk, IA                                                              
      Warren, IA                                                            
    2160  \1\ Detroit, MI...............................    1.0601    1.0408
      Lapeer, MI                                                            
      Macomb, MI                                                            
      Monroe, MI                                                            
      Oakland, MI                                                           
      St. Clair, MI                                                         
      Wayne, MI                                                             
    2180  Dothan, AL....................................    0.7827    0.8455
      Dale, AL                                                              
      Houston, AL                                                           
    2190  Dover, DE.....................................    0.9441    0.9614
      Kent, DE                                                              
    2200  Dubuque, IA...................................    0.8292    0.8796
      Dubuque, IA                                                           
    2240  Duluth-Superior, MN-WI........................    1.0133    1.0091
      St. Louis, MN                                                         
      Douglas, WI                                                           
    2281  Dutchess County, NY...........................    0.9860    0.9904
      Dutchess, NY                                                          
    2290  Eau Claire, WI................................    0.8755    0.9130
      Chippewa, WI                                                          
    
    [[Page 25639]]
    
                                                                            
      Eau Claire, WI                                                        
    2320  El Paso, TX...................................    0.8978    0.9288
      El Paso, TX                                                           
    2330  Elkhart-Goshen, IN............................    0.9168    0.9422
      Elkhart, IN                                                           
    2335  \2\ Elmira, NY................................    0.8640    0.9047
      Chemung, NY                                                           
    2340  Enid, OK......................................    0.8050    0.8620
      Garfield, OK                                                          
    2360  Erie, PA......................................    0.9343    0.9545
      Erie, PA                                                              
    2400  Eugene-Springfield, OR........................    1.1288    1.0865
      Lane, OR                                                              
    2440  Evansville-Henderson, IN-KY...................    0.8505    0.8950
      Posey, IN                                                             
      Vanderburgh, IN                                                       
      Warrick, IN                                                           
      Henderson, KY                                                         
    2520  Fargo-Moorhead, ND-MN (North Dakota Hospitals)    0.7905    0.8513
      Clay, MN                                                              
      Cass, ND                                                              
    2520  \2\ Fargo-Moorhead, ND-MN (Minnesota                              
     Hospitals).........................................    0.8665    0.9065
      Clay, MN                                                              
      Cass, ND                                                              
    2560  Fayetteville, NC..............................    0.8460    0.8918
      Cumberland, NC                                                        
    2580  Fayetteville-Springdale-Rogers, AR............    0.8686    0.9080
      Benton, AR                                                            
      Washington, AR                                                        
    2620  Flagstaff, AZ-UT..............................    0.9602    0.9726
      Coconino, AZ                                                          
      Kane, UT                                                              
    2640  Flint, MI.....................................    1.1106    1.0745
      Genesee, MI                                                           
    2650  Florence, AL..................................    0.7740    0.8391
      Colbert, AL                                                           
      Lauderdale, AL                                                        
    2655  Florence, SC..................................    0.8368    0.8851
      Florence, SC                                                          
    2670  Fort Collins-Loveland, CO.....................    1.0383    1.0261
      Larimer, CO                                                           
    2680  \1\ Ft. Lauderdale, FL........................    1.0534    1.0363
      Broward, FL                                                           
    2700  Fort Myers-Cape Coral, FL.....................    0.9017    0.9316
      Lee, FL                                                               
    2710  Fort Pierce-Port St. Lucie, FL................    0.9847    0.9895
      Martin, FL                                                            
      St. Lucie, FL                                                         
    2720  Fort Smith, AR-OK.............................    0.7687    0.8352
      Crawford, AR                                                          
      Sebastian, AR                                                         
      Sequoyah, OK                                                          
    2750  \2\ Fort Walton Beach, FL.....................    0.8947    0.9266
      Okaloosa, FL                                                          
    2760  Fort Wayne, IN................................    0.8896    0.9230
      Adams, IN                                                             
      Allen, IN                                                             
      De Kalb, IN                                                           
      Huntington, IN                                                        
      Wells, IN                                                             
      Whitley, IN                                                           
    2800  \1\ Forth Worth-Arlington, TX.................    0.9192    0.9439
      Hood, TX                                                              
      Johnson, TX                                                           
      Parker, TX                                                            
      Tarrant, TX                                                           
    2840  Fresno, CA....................................    1.0491    1.0334
      Fresno, CA                                                            
      Madera, CA                                                            
    2880  Gadsden, AL...................................    0.8854    0.9200
      Etowah, AL                                                            
    2900  Gainesville, FL...............................    0.9542    0.9684
      Alachua, FL                                                           
    2920  Galveston-Texas City, TX......................    0.9549    0.9689
      Galveston, TX                                                         
    2960  Gary, IN......................................    0.9542    0.9684
      Lake, IN                                                              
      Porter, IN                                                            
    2975  \2\ Glens Falls, NY...........................    0.8640    0.9047
      Warren, NY                                                            
      Washington, NY                                                        
    2980  Goldsboro, NC.................................    0.8523    0.8963
      Wayne, NC                                                             
    2985  Grand Forks, ND-MN............................    0.8996    0.9301
      Polk, MN                                                              
      Grand Forks, ND                                                       
    2995  Grand Junction, CO............................    0.9110    0.9382
      Mesa, CO                                                              
    3000  \1\ Grand Rapids-Muskegon-Holland, MI.........    1.0018    1.0012
      Allegan, MI                                                           
      Kent, MI                                                              
      Muskegon, MI                                                          
      Ottawa, MI                                                            
    3040  Great Falls, MT...............................    0.9362    0.9559
      Cascade, MT                                                           
    3060  Greeley, CO...................................    0.9856    0.9901
      Weld, CO                                                              
    3080  Green Bay, WI.................................    0.9323    0.9531
      Brown, WI                                                             
    3120  \1\ Greensboro-Winston-Salem-High Point, NC...    0.9418    0.9598
      Alamance, NC                                                          
      Davidson, NC                                                          
      Davie, NC                                                             
      Forsyth, NC                                                           
      Guilford, NC                                                          
      Randolph, NC                                                          
      Stokes, NC                                                            
      Yadkin, NC                                                            
    3150  Greenville, NC................................    0.9034    0.9328
      Pitt, NC                                                              
    3160  Greenville-Spartanburg-Anderson, SC...........    0.9318    0.9528
      Anderson, SC                                                          
      Cherokee, SC                                                          
      Greenville, SC                                                        
      Pickens, SC                                                           
      Spartanburg, SC                                                       
    3180  Hagerstown, MD................................    1.0268    1.0183
      Washington, MD                                                        
    3200  Hamilton-Middletown, OH.......................    0.9292    0.9510
      Butler, OH                                                            
    3240  Harrisburg-Lebanon-Carlisle, PA...............    0.9572    0.9705
      Cumberland, PA                                                        
      Dauphin, PA                                                           
      Lebanon, PA                                                           
      Perry, PA                                                             
    3283  \1\ \2\ Hartford, CT..........................    1.2175    1.1443
      Hartford, CT                                                          
      Litchfield, CT                                                        
      Middlesex, CT                                                         
      Tolland, CT                                                           
    3285  \2\ Hattiesburg, MS...........................    0.7359    0.8106
      Forrest, MS                                                           
      Lamar, MS                                                             
    3290  Hickory-Morganton-Lenoir, NC..................    0.8687    0.9081
      Alexander, NC                                                         
      Burke, NC                                                             
      Caldwell, NC                                                          
      Catawba, NC                                                           
    3320  Honolulu, HI..................................    1.1628    1.1088
      Honolulu, HI                                                          
    3350  Houma, LA.....................................    0.8266    0.8777
      Lafourche, LA                                                         
      Terrebonne, LA                                                        
    3360  \1\ Houston, TX...............................    1.0017    1.0012
      Chambers, TX                                                          
      Fort Bend, TX                                                         
      Harris, TX                                                            
      Liberty, TX                                                           
      Montgomery, TX                                                        
      Waller, TX                                                            
    3400  Huntington-Ashland, WV-KY-OH..................    0.9728    0.9813
      Boyd, KY                                                              
      Carter, KY                                                            
      Greenup, KY                                                           
      Lawrence, OH                                                          
      Cabell, WV                                                            
      Wayne, WV                                                             
    3440  Huntsville, AL................................    0.8428    0.8895
      Limestone, AL                                                         
      Madison, AL                                                           
    3480  \1\ Indianapolis, IN..........................    0.9901    0.9932
      Boone, IN                                                             
      Hamilton, IN                                                          
      Hancock, IN                                                           
      Hendricks, IN                                                         
      Johnson, IN                                                           
      Madison, IN                                                           
      Marion, IN                                                            
      Morgan, IN                                                            
      Shelby, IN                                                            
    3500  Iowa City, IA.................................    0.9561    0.9697
      Johnson, IA                                                           
    3520  Jackson, MI...................................    0.9302    0.9517
      Jackson, MI                                                           
    
    [[Page 25640]]
    
                                                                            
    3560  Jackson, MS...................................    0.8279    0.8787
      Hinds, MS                                                             
      Madison, MS                                                           
      Rankin, MS                                                            
    3580  Jackson, TN...................................    0.8632    0.9042
      Madison, TN                                                           
      Chester, TN                                                           
    3600  \1\ \2\ Jacksonville, FL......................    0.8947    0.9266
      Clay, FL                                                              
      Duval, FL                                                             
      Nassau, FL                                                            
      St. Johns, FL                                                         
    3605  \2\ Jacksonville, NC..........................    0.8162    0.8702
      Onslow, NC                                                            
    3610  \2\ Jamestown, NY.............................    0.8640    0.9047
      Chautauqua, NY                                                        
    3620  Janesville-Beloit, WI.........................    0.9128    0.9394
      Rock, WI                                                              
    3640  Jersey City, NJ...............................    1.1372    1.0920
      Hudson, NJ                                                            
    3660  Johnson City-Kingsport-Bristol, TN-VA.........    0.8847    0.9195
      Carter, TN                                                            
      Hawkins, TN                                                           
      Sullivan, TN                                                          
      Unicoi, TN                                                            
      Washington, TN                                                        
      Bristol City, VA                                                      
      Scott, VA                                                             
      Washington, VA                                                        
    3680  Johnstown, PA.................................    0.8671    0.9070
      Cambria, PA                                                           
      Somerset, PA                                                          
    3700  Jonesboro, AR.................................    0.7643    0.8319
      Craighead, AR                                                         
    3710  Joplin, MO....................................    0.7933    0.8534
      Jasper, MO                                                            
      Newton, MO                                                            
    3720  Kalamazoo-Battlecreek, MI.....................    1.2009    1.1336
      Calhoun, MI                                                           
      Kalamazoo, MI                                                         
      Van Buren, MI                                                         
    3740  Kankakee, IL..................................    0.9175    0.9427
      Kankakee, IL                                                          
    3760  \1\ Kansas City, KS-MO........................    0.9672    0.9774
      Johnson, KS                                                           
      Leavenworth, KS                                                       
      Miami, KS                                                             
      Wyandotte, KS                                                         
      Cass, MO                                                              
      Clay, MO                                                              
      Clinton, MO                                                           
      Jackson, MO                                                           
      Lafayette, MO                                                         
      Platte, MO                                                            
      Ray, MO                                                               
    3800  Kenosha, WI...................................    0.9206    0.9449
      Kenosha, WI                                                           
    3810  Killeen-Temple, TX............................    1.0180    1.0123
      Bell, TX                                                              
      Coryell, TX                                                           
    3840  Knoxville, TN.................................    0.8569    0.8996
      Anderson, TN                                                          
      Blount, TN                                                            
      Knox, TN                                                              
      Loudon, TN                                                            
      Sevier, TN                                                            
      Union, TN                                                             
    3850  Kokomo, IN....................................    0.9350    0.9550
      Howard, IN                                                            
      Tipton, IN                                                            
    3870  La Crosse, WI-MN..............................    0.8989    0.9296
      Houston, MN                                                           
      La Crosse, WI                                                         
    3880  Lafayette, LA.................................    0.8363    0.8848
      Acadia, LA                                                            
      Lafayette, LA                                                         
      St. Landry, LA                                                        
      St. Martin, LA                                                        
    3920  Lafayette, IN.................................    0.8984    0.9293
      Clinton, IN                                                           
      Tippecanoe, IN                                                        
    3960  Lake Charles, LA..............................    0.7738    0.8389
      Calcasieu, LA                                                         
    3980  Lakeland-Winter Haven, FL.....................    0.8947    0.9266
      Polk, FL                                                              
    4000  Lancaster, PA.................................    0.9646    0.9756
      Lancaster, PA                                                         
    4040  Lansing-East Lansing, MI......................    1.0130    1.0089
      Clinton, MI                                                           
      Eaton, MI                                                             
      Ingham, MI                                                            
    4080  \2\ Laredo, TX................................    0.7404    0.8140
      Webb, TX                                                              
    4100  Las Cruces, NM................................    0.9045    0.9336
      Dona Ana, NM                                                          
    4120  \1\ Las Vegas, NV-AZ..........................    1.1349    1.0905
       Mohave, AZ                                                           
      Clark, NV                                                             
      Nye, NV                                                               
    4150  Lawrence, KS..................................    0.8728    0.9110
      Douglas, KS                                                           
    4200  Lawton, OK....................................    0.8770    0.9140
      Comanche, OK                                                          
    4243  Lewiston-Auburn, ME...........................    0.9226    0.9463
      Androscoggin, ME                                                      
    4280  Lexington, KY.................................    0.8579    0.9004
      Bourbon, KY                                                           
      Clark, KY                                                             
      Fayette, KY                                                           
      Jessamine, KY                                                         
      Madison, KY                                                           
      Scott, KY                                                             
      Woodford, KY                                                          
    4320  Lima, OH......................................    0.8885    0.9222
      Allen, OH                                                             
      Auglaize, OH                                                          
    4360  Lincoln, NE...................................    0.9082    0.9362
      Lancaster, NE                                                         
    4400  Little Rock-North Little Rock, AR.............    0.8598    0.9017
      Faulkner, AR                                                          
      Lonoke, AR                                                            
      Pulaski, AR                                                           
      Saline, AR                                                            
    4420  Longview-Marshall, TX.........................    0.8583    0.9007
      Gregg, TX                                                             
      Harrison, TX                                                          
      Upshur, TX                                                            
    4480  \1\ Los Angeles-Long Beach, CA................    1.2124    1.1410
      Los Angeles, CA                                                       
    4520  Louisville, KY-IN.............................    0.9212    0.9453
      Clark, IN                                                             
      Floyd, IN                                                             
      Harrison, IN                                                          
      Scott, IN                                                             
      Bullitt, KY                                                           
      Jefferson, KY                                                         
      Oldham, KY                                                            
    4600  Lubbock, TX...................................    0.8460    0.8918
      Lubbock, TX                                                           
    4640  Lynchburg, VA.................................    0.8680    0.9076
      Amherst, VA                                                           
      Bedford, VA                                                           
      Bedford City, VA                                                      
      Campbell, VA                                                          
      Lynchburg City, VA                                                    
    4680  Macon, GA.....................................    0.9109    0.9381
      Bibb, GA                                                              
      Houston, GA                                                           
      Jones, GA                                                             
      Peach, GA                                                             
      Twiggs, GA                                                            
    4720  Madison, WI...................................    1.0103    1.0070
      Dane, WI                                                              
    4800  Mansfield, OH.................................    0.8606    0.9023
      Crawford, OH                                                          
      Richland, OH                                                          
    4840  Mayaguez, PR..................................    0.4360    0.5664
      Anasco, PR                                                            
      Cabo Rojo, PR                                                         
      Hormigueros, PR                                                       
      Mayaguez, PR                                                          
      Sabana Grande, PR                                                     
      San German, PR                                                        
    4880  McAllen-Edinburg-Mission, TX..................    0.8541    0.8976
      Hidalgo, TX                                                           
    4890  Medford-Ashland, OR...........................    1.0109    1.0075
      Jackson, OR                                                           
    4900  Melbourne-Titusville-Palm Bay, FL.............    0.9289    0.9507
      Brevard, Fl                                                           
    4920  \1\ Memphis, TN-AR-MS.........................    0.8423    0.8891
      Crittenden, AR                                                        
      DeSoto, MS                                                            
      Fayette, TN                                                           
      Shelby, TN                                                            
      Tipton, TN                                                            
    4940  Merced, CA....................................    1.0304    1.0207
      Merced, CA                                                            
    5000  \1\ Miami, FL.................................    0.9427    0.9604
      Dade, FL                                                              
    5015  \1\ Middlesex-Somerset-Hunterdon, NJ..........    1.0871    1.0589
    
    [[Page 25641]]
    
                                                                            
      Hunterdon, NJ                                                         
      Middlesex, NJ                                                         
      Somerset, NJ                                                          
    5080  \1\ Milwaukee-Waukesha, WI....................    0.9470    0.9634
      Milwaukee, WI                                                         
      Ozaukee, WI                                                           
      Washington, WI                                                        
      Waukesha, WI                                                          
    5120  \1\ Minneapolis-St. Paul, MN-WI...............    1.0956    1.0645
      Anoka, MN                                                             
      Carver, MN                                                            
      Chisago, MN                                                           
      Dakota, MN                                                            
      Hennepin, MN                                                          
      Isanti, MN                                                            
      Ramsey, MN                                                            
      Scott, MN                                                             
      Sherburne, MN                                                         
      Washington, MN                                                        
      Wright, MN                                                            
      Pierce, WI                                                            
      St. Croix, WI                                                         
    5160  Mobile, AL....................................    0.7942    0.8540
      Baldwin, AL                                                           
      Mobile, AL                                                            
    5170  Modesto, CA...................................    1.0406    1.0276
      Stanislaus, CA                                                        
    5190  \1\ Monmouth-Ocean, NJ........................    1.1285    1.0863
      Monmouth, NJ                                                          
      Ocean, NJ                                                             
    5200  Monroe, LA....................................    0.8288    0.8793
      Ouachita, LA                                                          
    5240  Montgomery, AL................................    0.7919    0.8523
      Autauga, AL                                                           
      Elmore, AL                                                            
      Montgomery, AL                                                        
    5280  Muncie, IN....................................    0.9493    0.9650
      Delaware, IN                                                          
    5330  \2\ Myrtle Beach, SC..........................    0.8110    0.8664
      Horry, SC                                                             
    5345  Naples, FL....................................    1.0205    1.0140
      Collier, FL                                                           
    5360  \1\ Nashville, TN.............................    0.9336    0.9540
      Cheatham, TN                                                          
      Davidson, TN                                                          
      Dickson, TN                                                           
      Robertson, TN                                                         
      Rutherford TN                                                         
      Sumner, TN                                                            
      Williamson, TN                                                        
      Wilson, TN                                                            
    5380  \1\ Nassau-Suffolk, NY........................    1.3123    1.2046
      Nassau, NY                                                            
      Suffolk, NY                                                           
    5483  \1\ \2\ New Haven-Bridgeport-Stamford-                            
     Waterbury-Danbury, CT..............................    1.2175    1.1443
      Fairfield, CT                                                         
      New Haven, CT                                                         
    5523  \2\ New London-Norwich, CT....................    1.2175    1.1443
      New London, CT                                                        
    5560  \1\ New Orleans, LA...........................    0.9397    0.9583
      Jefferson, LA                                                         
      Orleans, LA                                                           
      Plaquemines, LA                                                       
      St. Bernard, LA                                                       
      St. Charles, LA                                                       
      St. James, LA                                                         
      St. John The Baptist, LA                                              
      St. Tammany, LA                                                       
    5600  \1\ New York, NY..............................    1.4537    1.2920
      Bronx, NY                                                             
      Kings, NY                                                             
      New York, NY                                                          
      Putnam, NY                                                            
      Queens, NY                                                            
      Richmond, NY                                                          
      Rockland, NY                                                          
      Westchester, NY                                                       
    5640  \1\ Newark, NJ................................    1.0899    1.0607
      Essex, NJ                                                             
      Morris, NJ                                                            
      Sussex, NJ                                                            
      Union, NJ                                                             
      Warren, NJ                                                            
    5660  Newburgh, NY-PA...............................    1.1226    1.0824
      Orange, NY                                                            
      Pike, PA                                                              
    5720  \1\ Norfolk-Virginia Beach-Newport News, VA-NC    0.8235    0.8755
      Currituck, NC                                                         
      Chesapeake City, VA                                                   
      Gloucester, VA                                                        
      Hampton City, VA                                                      
      Isle of Wight, VA                                                     
      James City, VA                                                        
      Mathews, VA                                                           
      Newport News City, VA                                                 
      Norfolk City, VA                                                      
      Poquoson City, VA                                                     
      Portsmouth City, VA                                                   
      Suffolk City, VA                                                      
      Virginia Beach City VA                                                
      Williamsburg City, VA                                                 
      York, VA                                                              
    5775  \1\ Oakland, CA...............................    1.5309    1.3386
      Alameda, CA                                                           
      Contra Costa, CA                                                      
    5790  Ocala, FL.....................................    0.9229    0.9465
      Marion, FL                                                            
    5800  Odessa-Midland, TX............................    0.7773    0.8415
      Ector, TX                                                             
      Midland, TX                                                           
    5880  \1\ Oklahoma City, OK.........................    0.8764    0.9136
      Canadian, OK                                                          
      Cleveland, OK                                                         
      Logan, OK                                                             
      McClain, OK                                                           
      Oklahoma, OK                                                          
      Pottawatomie, OK                                                      
    5910  Olympia, WA...................................    1.1605    1.1073
      Thurston, WA                                                          
    5920  Omaha, NE-IA..................................    0.9938    0.9958
      Pottawattamie, IA                                                     
      Cass, NE                                                              
      Douglas, NE                                                           
      Sarpy, NE                                                             
      Washington, NE                                                        
    5945  \1\ Orange County, CA.........................    1.1153    1.0776
      Orange, CA                                                            
    5960  \1\ Orlando, FL...............................    0.9933    0.9954
      Lake, FL                                                              
      Orange, FL                                                            
      Osceola, FL                                                           
      Seminole, FL                                                          
    5990  \2\ Owensboro, KY.............................    0.7902    0.8511
      Daviess, KY                                                           
    6015  \2\ Panama City, FL...........................    0.8947    0.9266
      Bay, FL                                                               
    6020  Parkersburg-Marietta, WV-OH (West Virginia                        
     Hospitals).........................................    0.8118    0.8669
      Washington, OH                                                        
      Wood, WV                                                              
    6020  \2\ Parkersburg-Marietta, WV-OH (Ohio                             
     Hospitals).........................................    0.8576    0.9001
      Washington, OH                                                        
      Wood, WV                                                              
    6080  \2\ Pensacola, FL.............................    0.8947    0.9266
      Escambia, FL                                                          
      Santa Rosa, FL                                                        
    6120  Peoria-Pekin, IL..............................    0.8157    0.8698
      Peoria, IL                                                            
      Tazewell, IL                                                          
      Woodford, IL                                                          
    6160  \1\ Philadelphia, PA-NJ.......................    1.1427    1.0957
      Burlington, NJ                                                        
      Camden, NJ                                                            
      Gloucester, NJ                                                        
      Salem, NJ                                                             
      Bucks, PA                                                             
      Chester, PA                                                           
      Delaware, PA                                                          
      Montgomery, PA                                                        
      Philadelphia, PA                                                      
    6200  \1\ Phoenix-Mesa, AZ..........................    0.9759    0.9834
      Maricopa, AZ                                                          
      Pinal, AZ                                                             
    6240  Pine Bluff, AR................................    0.8003    0.8585
      Jefferson, AR                                                         
    6280  \1\ Pittsburgh, PA............................    0.9896    0.9929
      Allegheny, PA                                                         
      Beaver, PA                                                            
      Butler, PA                                                            
      Fayette, PA                                                           
      Washington, PA                                                        
      Westmoreland, PA                                                      
    6323  \2\ Pittsfield, MA............................    1.0917    1.0619
      Berkshire, MA                                                         
    6340  Pocatello, ID.................................    0.8760    0.9133
    
    [[Page 25642]]
    
                                                                            
      Bannock, ID                                                           
    6360  Ponce, PR.....................................    0.4740    0.5998
      Guayanilla, PR                                                        
      Juana Diaz, PR                                                        
      Penuelas, PR                                                          
      Ponce, PR                                                             
      Villalba, PR                                                          
      Yauco, PR                                                             
    6403  Portland, ME..................................    0.9537    0.9681
      Cumberland, ME                                                        
      Sagadahoc, ME                                                         
      York, ME                                                              
    6440  \1\ Portland-Vancouver, OR-WA.................    1.1274    1.0856
      Clackamas, OR                                                         
      Columbia, OR                                                          
      Multnomah, OR                                                         
      Washington, OR                                                        
      Yamhill, OR                                                           
      Clark, WA                                                             
    6483  \1\ Providence-Warwick-Pawtucket, RI..........    1.0888    1.0600
      Bristol, RI                                                           
      Kent, RI                                                              
      Newport, RI                                                           
      Providence, RI                                                        
      Washington, RI                                                        
    6520  Provo-Orem, UT................................    0.9910    0.9938
      Utah, UT                                                              
    6560  Pueblo, CO....................................    0.8785    0.9151
      Pueblo, CO                                                            
    6580  Punta Gorda, FL...............................    0.8994    0.9300
      Charlotte, FL                                                         
    6600  Racine, WI....................................    0.9207    0.9450
      Racine, WI                                                            
    6640  \1\ Raleigh-Durham-Chapel Hill, NC............    0.9909    0.9938
      Chatham, NC                                                           
      Durham, NC                                                            
      Franklin, NC                                                          
      Johnston, NC                                                          
      Orange, NC                                                            
      Wake, NC                                                              
    6660  Rapid City, SD................................    0.8277    0.8785
      Pennington, SD                                                        
    6680  Reading, PA...................................    0.9282    0.9503
      Berks, PA                                                             
    6690  Redding, CA...................................    1.2017    1.1341
      Shasta, CA                                                            
    6720  Reno, NV......................................    1.0169    1.0115
      Washoe, NV                                                            
    6740  \2\ Richland-Kennewick-Pasco, WA..............    1.0577    1.0392
      Benton, WA                                                            
      Franklin, WA                                                          
    6760  Richmond-Petersburg, VA.......................    0.9257    0.9485
      Charles City County, 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                                                     
    6780  \1\ Riverside-San Bernardino, CA..............    1.0151    1.0103
      Riverside, CA                                                         
      San Bernardino, CA                                                    
    6800  Roanoke, VA...................................    0.8581    0.9005
      Botetourt, VA                                                         
      Roanoke, VA                                                           
      Roanoke City, VA                                                      
      Salem City, VA                                                        
    6820  Rochester, MN.................................    1.1797    1.1198
      Olmsted, MN                                                           
    6840  \1\ Rochester, NY.............................    0.9678    0.9778
      Genesee, NY                                                           
      Livingston, NY                                                        
      Monroe, NY                                                            
      Ontario, NY                                                           
      Orleans, NY                                                           
      Wayne, NY                                                             
    6880  Rockford, IL..................................    0.8703    0.9093
      Boone, IL                                                             
      Ogle, IL                                                              
      Winnebago, IL                                                         
    6895  Rocky Mount, NC...............................    0.8214    0.8740
      Edgecombe, NC                                                         
      Nash, NC                                                              
    6920  \1\ Sacramento, CA............................    1.1952    1.1299
      El Dorado, CA                                                         
      Placer, CA                                                            
      Sacramento, CA                                                        
    6960  Saginaw-Bay City-Midland, MI..................    0.9567    0.9701
      Bay, MI                                                               
      Midland, MI                                                           
      Saginaw, MI                                                           
    6980  St. Cloud, MN.................................    0.9667    0.9771
      Benton, MN                                                            
      Stearns, MN                                                           
    7000  St. Joseph, MO................................    0.9972    0.9981
      Andrew, MO                                                            
      Buchanan, MO                                                          
    7040  \1\ St. Louis, MO-IL..........................    0.9063    0.9348
      Clinton, IL                                                           
      Jersey, IL                                                            
      Madison, IL                                                           
      Monroe, IL                                                            
      St. Clair, IL                                                         
      Franklin, MO                                                          
      Jefferson, MO                                                         
      Lincoln, MO                                                           
      St. Charles, MO                                                       
      St. Louis, MO                                                         
      St. Louis City, MO                                                    
      Warren, MO                                                            
    7080  Salem, OR.....................................    0.9987    0.9991
      Marion, OR                                                            
      Polk, OR                                                              
    7120  Salinas, CA...................................    1.5270    1.3363
      Monterey, CA                                                          
    7160  \1\ Salt Lake City-Ogden, UT..................    0.9458    0.9626
      Davis, UT                                                             
      Salt Lake, UT                                                         
      Weber, UT                                                             
    7200  San Angelo, TX................................    0.7512    0.8221
      Tom Green, TX                                                         
    7240  \1\ San Antonio, TX...........................    0.7744    0.8394
      Bexar, TX                                                             
      Comal, TX                                                             
      Guadalupe, TX                                                         
      Wilson, TX                                                            
    7320  \1\ San Diego, CA.............................    1.2388    1.1579
      San Diego, CA                                                         
    7360  \1\ San Francisco, CA.........................    1.3621    1.2357
      Marin, CA                                                             
      San Francisco, CA                                                     
      San Mateo, CA                                                         
    7400  \1\ San Jose, CA..............................    1.3783    1.2457
      Santa Clara, CA                                                       
    7440  \1\ San Juan-Bayamon, PR......................    0.4521    0.5806
      Aguas Buenas, PR                                                      
      Barceloneta, PR                                                       
      Bayamon, PR                                                           
      Canovanas, PR                                                         
      Carolina, PR                                                          
      Catano, PR                                                            
      Ceiba, PR                                                             
      Comerio, PR                                                           
      Corozal, PR                                                           
      Dorado, PR                                                            
      Fajardo, PR                                                           
      Florida, PR                                                           
      Guaynabo, PR                                                          
      Humacao, PR                                                           
      Juncos, PR                                                            
      Los Piedras, PR                                                       
      Loiza, PR                                                             
      Luguillo, PR                                                          
      Manati, PR                                                            
      Morovis, PR                                                           
      Naguabo, 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                                                           
    7460  San Luis Obispo-Atascadero-Paso Robles, CA....    1.0825    1.0558
      San Luis Obispo, CA                                                   
    7480  Santa Barbara-Santa Maria-Lompoc, CA..........    1.1233    1.0829
      Santa Barbara, CA                                                     
    7485  Santa Cruz-Watsonville, CA....................    1.4099    1.2652
      Santa Cruz, CA                                                        
    7490  Santa Fe, NM..................................    0.9525    0.9672
    
    [[Page 25643]]
    
                                                                            
      Los Alamos, NM                                                        
      Santa Fe, NM                                                          
    7500  Santa Rosa, CA................................    1.3167    1.2073
      Sonoma, CA                                                            
    7510  Sarasota-Bradenton, FL........................    0.9567    0.9701
      Manatee, FL                                                           
      Sarasota, FL                                                          
    7520  Savannah, GA..................................    0.8776    0.9145
      Bryan, GA                                                             
      Chatham, GA                                                           
      Effingham, GA                                                         
    7560  \2\ Scranton-Wilkes-Barre-Hazleton, PA........    0.8615    0.9029
      Columbia, PA                                                          
      Lackawanna, PA                                                        
      Luzerne, PA                                                           
      Wyoming, PA                                                           
    7600  \1\ Seattle-Bellevue-Everett, WA..............    1.1634    1.1092
      Island, WA                                                            
      King, WA                                                              
      Snohomish, WA                                                         
    7610  Sharon, PA....................................    0.8948    0.9267
      Mercer, PA                                                            
    7620  \2\ Sheboygan, WI.............................    0.8557    0.8988
      Sheboygan, WI                                                         
    7640  Sherman-Denison, TX...........................    0.8229    0.8750
      Grayson, TX                                                           
    7680  Shreveport-Bossier City, LA...................    0.9436    0.9610
      Bossier, LA                                                           
      Caddo, LA                                                             
      Webster, LA                                                           
    7720  Sioux City, IA-NE.............................    0.8530    0.8968
      Woodbury, IA                                                          
      Dakota, NE                                                            
    7760  Sioux Falls, SD...............................    0.8988    0.9295
      Lincoln, SD                                                           
      Minnehaha, SD                                                         
    7800  South Bend, IN................................    0.9939    0.9958
      St. Joseph, IN                                                        
    7840  Spokane, WA...................................    1.1020    1.0688
      Spokane, WA                                                           
    7880  Springfield, IL...............................    0.8793    0.9157
      Menard, IL                                                            
      Sangamon, IL                                                          
    7920  Springfield, MO...............................    0.8151    0.8694
      Christian, MO                                                         
      Greene, MO                                                            
      Webster, MO                                                           
    8003  Springfield, MA...............................    1.0917    1.0619
      Hampden, MA                                                           
      Hampshire, MA                                                         
    8050  State College, PA.............................    0.9528    0.9674
      Centre, PA                                                            
    8080  \2\ Steubenville-Weirton, OH-WV (Ohio                             
     Hospitals).........................................    0.8576    0.9001
      Jefferson, OH                                                         
      Brooke, WV                                                            
      Hancock, WV                                                           
    8080  Steubenville-Weirton, OH-WV (West Virginia                        
     Hospitals).........................................    0.8476    0.8929
      Jefferson, OH                                                         
      Brooke, WV                                                            
      Hancock, WV                                                           
    8120  Stockton-Lodi, CA.............................    1.1157    1.0779
      San Joaquin, CA                                                       
    8140  Sumter, SC....................................    0.8195    0.8726
      Sumter, SC                                                            
    8160  Syracuse, NY..................................    0.9410    0.9592
      Cayuga, NY                                                            
      Madison, NY                                                           
      Onondaga, NY                                                          
      Oswego, NY                                                            
    8200  \2\ Tacoma, WA................................    1.0577    1.0392
      Pierce, WA                                                            
    8240  \2\ Tallahassee, FL...........................    0.8947    0.9266
      Gadsden, FL                                                           
      Leon, FL                                                              
    8280  \1\ Tampa-St. Petersburg-Clearwater, FL.......    0.9179    0.9430
      Hernando, FL                                                          
      Hillsborough, FL                                                      
      Pasco, FL                                                             
      Pinellas, FL                                                          
    8320  Terre Haute, IN...............................    0.9063    0.9348
      Clay, IN                                                              
      Vermillion, IN                                                        
      Vigo, IN                                                              
    8360  Texarkana, AR-Texarkana, TX...................    0.7538    0.8240
      Miller, AR                                                            
      Bowie, TX                                                             
    8400  Toledo, OH....................................    1.0132    1.0090
      Fulton, OH                                                            
      Lucas, OH                                                             
      Wood, OH                                                              
    8440  Topeka, KS....................................    0.9894    0.9927
      Shawnee, KS                                                           
    8480  Trenton, NJ...................................    1.0399    1.0272
      Mercer, NJ                                                            
    8520  Tucson, AZ....................................    0.9104    0.9377
      Pima, AZ                                                              
    8560  Tulsa, OK.....................................    0.8520    0.8961
      Creek, OK                                                             
      Osage, OK                                                             
      Rogers, OK                                                            
      Tulsa, OK                                                             
      Wagoner, OK                                                           
    8600  Tuscaloosa, AL................................    0.7706    0.8366
      Tuscaloosa, AL                                                        
    8640  Tyler, TX.....................................    0.8792    0.9156
      Smith, TX                                                             
    8680  \2\ Utica-Rome, NY............................    0.8640    0.9047
      Herkimer, NY                                                          
      Oneida, NY                                                            
    8720  Vallejo-Fairfield-Napa, CA....................    1.3458    1.2255
      Napa, CA                                                              
      Solano, CA                                                            
    8735  Ventura, CA...................................    1.0764    1.0517
      Ventura, CA                                                           
    8750  Victoria, TX..................................    0.8451    0.8911
      Victoria, TX                                                          
    8760  Vineland-Millville-Bridgeton, NJ..............    1.0460    1.0313
      Cumberland, NJ                                                        
    8780  Visalia-Tulare-Porterville, CA................    1.0168    1.0115
      Tulare, CA                                                            
    8800  Waco, TX......................................    0.8027    0.8603
      McLennan, TX                                                          
    8840  \1\ Washington, DC-MD-VA-WV...................    1.0863    1.0583
      District of Columbia, DC                                              
      Calvert, MD                                                           
      Charles, MD                                                           
      Frederick, MD                                                         
      Montgomery, MD                                                        
      Prince Georges, MD                                                    
      Alexandria City, VA                                                   
      Arlington, VA                                                         
      Clarke, VA                                                            
      Culpeper, VA                                                          
      Fairfax, VA                                                           
      Fairfax City, VA                                                      
      Falls Church City, VA                                                 
      Fauquier, VA                                                          
      Fredericksburg City, VA                                               
      King George, VA                                                       
      Loudoun, VA                                                           
      Manassas City, VA                                                     
      Manassas Park City, VA                                                
      Prince William, VA                                                    
      Spotsylvania, VA                                                      
      Stafford, VA                                                          
      Warren, VA                                                            
      Berkeley, WV                                                          
      Jefferson, WV                                                         
    8920  Waterloo-Cedar Falls, IA......................    0.8402    0.8876
      Black Hawk, IA                                                        
    8940  Wausau, WI....................................    0.9814    0.9872
      Marathon, WI                                                          
    8960  West Palm Beach-Boca Raton, FL................    1.0288    1.0196
      Palm Beach, FL                                                        
    9000  \2\ Wheeling, WV-OH (West Virginia Hospitals).    0.7938    0.8537
      Belmont, OH                                                           
      Marshall, WV                                                          
      Ohio, WV                                                              
    9000  \2\ Wheeling, WV-OH (Ohio Hospitals)..........    0.8576    0.9001
      Belmont, OH                                                           
      Marshall, WV                                                          
      Ohio, WV                                                              
    9040  Wichita, KS...................................    0.8990    0.9297
      Butler, KS                                                            
      Harvey, KS                                                            
      Sedgwick, KS                                                          
    9080  Wichita Falls, TX.............................    0.7864    0.8483
      Archer, TX                                                            
      Wichita, TX                                                           
    
    [[Page 25644]]
    
                                                                            
    9140  \2\ Williamsport, PA..........................    0.8615    0.9029
      Lycoming, PA                                                          
    9160  Wilmington-Newark, DE-MD......................    1.1968    1.1309
      New Castle, DE                                                        
      Cecil, MD                                                             
    9200  Wilmington, NC................................    0.9427    0.9604
      New Hanover, NC                                                       
      Brunswick, NC                                                         
    9260  \2\ Yakima, WA................................    1.0577    1.0392
      Yakima, WA                                                            
    9270  Yolo, CA......................................    1.0702    1.0476
      Yolo, CA                                                              
    9280  York, PA......................................    0.9509    0.9661
      York, PA                                                              
    9320  Youngstown-Warren, OH.........................    0.9897    0.9929
      Columbiana, OH                                                        
      Mahoning, OH                                                          
      Trumbull, OH                                                          
    9340  Yuba City, CA.................................    1.0957    1.0646
      Sutter, CA                                                            
      Yuba, CA                                                              
    9360  Yuma, AZ......................................    1.0143    1.0098
      Yuma, AZ                                                              
    ------------------------------------------------------------------------
    \1\ Large Urban Area                                                    
    \2\ Hospitals geographically located in the area are assigned the       
      statewide rural wage index for FY 1999.                               
    
    
    Table 4B.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
                                   Rural Areas                              
    ------------------------------------------------------------------------
                                                            Wage            
                        Nonurban area                       index      GAF  
    ------------------------------------------------------------------------
    Alabama.............................................    0.7385    0.8125
    Alaska..............................................    1.2534    1.1673
    Arizona.............................................    0.8082    0.8643
    Arkansas............................................    0.7274    0.8042
    California..........................................    0.9976    0.9984
    Colorado............................................    0.8454    0.8914
    Connecticut.........................................    1.2175    1.1443
    Delaware............................................    0.8590    0.9012
    Florida.............................................    0.8947    0.9266
    Georgia.............................................    0.7933    0.8534
    Hawaii..............................................    1.1011    1.0682
    Idaho...............................................    0.8548    0.8981
    Illinois............................................    0.7985    0.8572
    Indiana.............................................    0.8429    0.8896
    Iowa................................................    0.7846    0.8469
    Kansas..............................................    0.7334    0.8087
    Kentucky............................................    0.7902    0.8511
    Louisiana...........................................    0.7517    0.8225
    Maine...............................................    0.8538    0.8974
    Maryland............................................    0.8627    0.9038
    Massachusetts.......................................    1.0917    1.0619
    Michigan............................................    0.8988    0.9295
    Minnesota...........................................    0.8665    0.9065
    Mississippi.........................................    0.7359    0.8106
    Missouri............................................    0.7510    0.8219
    Montana.............................................    0.8645    0.9051
    Nebraska............................................    0.7683    0.8349
    Nevada..............................................    0.9267    0.9492
    New Hampshire.......................................    1.0324    1.0221
    New Jersey \1\......................................  ........  ........
    New Mexico..........................................    0.7927    0.8529
    New York............................................    0.8640    0.9047
    North Carolina......................................    0.8162    0.8702
    North Dakota........................................    0.7471    0.8190
    Ohio................................................    0.8576    0.9001
    Oklahoma............................................    0.7207    0.7991
    Oregon..............................................    0.9957    0.9971
    Pennsylvania........................................    0.8615    0.9029
    Puerto Rico.........................................    0.4083    0.5415
    Rhode Island \1\....................................  ........  ........
    South Carolina......................................    0.8110    0.8664
    South Dakota........................................    0.7564    0.8260
    Tennessee...........................................    0.7483    0.8199
    Texas...............................................    0.7404    0.8140
    Utah................................................    0.8851    0.9198
    Vermont.............................................    0.9489    0.9647
    Virginia............................................    0.7890    0.8502
    Washington..........................................    1.0577    1.0392
    West Virginia.......................................    0.7938    0.8537
    Wisconsin...........................................    0.8557    0.8988
    Wyoming.............................................    0.8763    0.9135
    ------------------------------------------------------------------------
    All counties within the State are classified as urban.                  
    
    
    Table 4C.--Wage Index and Capital Geographic Adjustment Factor (GAF) for
                         Hospitals That Are Reclassified                    
    ------------------------------------------------------------------------
                                                            Wage            
                            Area                            index      GAF  
    ------------------------------------------------------------------------
    Abilene, TX.........................................    0.8081    0.8642
    Albany, GA..........................................    0.7933    0.8534
    Albuquerque, NM.....................................    0.8813    0.9171
    Alexandria, LA......................................    0.8598    0.9017
    Allentown-Bethlehem-Easton, PA......................    1.0219    1.0149
    Amarillo, TX........................................    0.8483    0.8935
    Anchorage, AK.......................................    1.3088    1.2024
    Asheville, NC.......................................    0.9016    0.9315
    Atlanta, GA.........................................    1.0024    1.0016
    Augusta-Aiken, GA-SC................................    0.9309    0.9521
    Baltimore, MD.......................................    0.9760    0.9835
    Barnstable-Yarmouth, MA.............................    1.4646    1.2986
    Baton Rouge, LA.....................................    0.8940    0.9261
    Benton Harbor, MI...................................    0.8988    0.9295
    Bergen-Passaic, NJ..................................    1.1845    1.1229
    Billings, MT........................................    0.9220    0.9459
    Binghamton, NY......................................    0.8989    0.9296
    Birmingham, AL......................................    0.9150    0.9410
    Bismarck, ND........................................    0.7838    0.8464
    Boise City, ID......................................    0.9267    0.9492
    Boston-Worcester-Lawrence-Lowell-Brockton, MA-NH....    1.0885    1.0598
    Brazoria, TX........................................    0.8895    0.9229
    Bryan-College Station, TX...........................    0.7962    0.8555
    Buffalo-Niagara Falls, NY...........................    0.9592    0.9719
    Burlington, VT......................................    0.9612    0.9733
    Caguas, PR..........................................    0.4445    0.5739
    Canton-Massillon, OH................................    0.8895    0.9229
    Casper, WY..........................................    0.9227    0.9464
    Champaign-Urbana, IL................................    0.8844    0.9193
    Charleston-North Charleston, SC.....................    0.8931    0.9255
    Charleston, WV......................................    0.8819    0.9175
    Charlotte-Gastonia-Rock Hill, NC-SC.................    0.9568    0.9702
    Charlottesville, VA.................................    0.9803    0.9865
    Chattanooga, TN-GA..................................    0.8885    0.9222
    Chicago, IL.........................................    1.0507    1.0344
    Cincinnati, OH-KY-IN................................    0.9465    0.9630
    Clarksville-Hopkinsville, TN-KY.....................    0.8204    0.8732
    Cleveland-Lorain-Elyria, OH.........................    0.9970    0.9979
    Columbia, MO........................................    0.9331    0.9537
    Columbus, GA-AL.....................................    0.8573    0.8999
    Columbus, OH........................................    0.9929    0.9951
    Corpus Christi, TX..................................    0.8112    0.8665
    Dallas, TX..........................................    0.9149    0.9409
    Danville, VA........................................    0.8779    0.9147
    Davenport-Moline-Rock Island, IA-IL.................    0.8496    0.8944
    Dayton-Springfield, OH..............................    0.9670    0.9773
    Denver, CO..........................................    1.0532    1.0361
    Des Moines, IA......................................    0.8576    0.9001
    Duluth-Superior, MN-WI..............................    1.0133    1.0091
    Dutchess County, NY.................................    0.9860    0.9904
    Elkhart-Goshen, IN..................................    0.9168    0.9422
    Eugene-Springfield, OR..............................    1.1141    1.0768
    Evansville-Henderson, IN-KY.........................    0.8505    0.8950
    Fargo-Moorhead, ND-MN (Minnesota Hospital)..........    0.8665    0.9065
    Fargo-Moorhead, ND-MN (South Dakota Hospital).......    0.7905    0.8513
    Fayetteville, NC....................................    0.8460    0.8918
    Flagstaff, AZ-UT....................................    0.9602    0.9726
    Flint, MI...........................................    1.1106    1.0745
    Fort Collins-Loveland, CO...........................    1.0383    1.0261
    Ft. Lauderdale, FL..................................    1.0534    1.0363
    Fort Pierce-Port St. Lucie, FL......................    0.9847    0.9895
    Fort Smith, AR-OK...................................    0.7582    0.8273
    Fort Walton Beach, FL...............................    0.8694    0.9086
    Forth Worth-Arlington, TX...........................    0.9192    0.9439
    Gadsden, AL.........................................    0.8854    0.9200
    Gainesville, FL.....................................    0.9542    0.9684
    Goldsboro, NC.......................................    0.8366    0.8850
    Grand Forks, ND-MN..................................    0.8996    0.9301
    Grand Junction, CO..................................    0.9110    0.9382
    Grand Rapids-Muskegon-Holland, MI...................    0.9908    0.9937
    Great Falls, MT.....................................    0.9362    0.9559
    Greeley, CO.........................................    0.9663    0.9768
    Green Bay, WI.......................................    0.9323    0.9531
    Greenville, NC......................................    0.8844    0.9193
    Greenville-Spartanburg-Anderson, SC.................    0.9318    0.9528
    Harrisburg-Lebanon-Carlisle, PA.....................    0.9572    0.9705
    
    [[Page 25645]]
    
                                                                            
    Hartford, CT........................................    1.1152    1.0775
    Hattiesburg, MS.....................................    0.7359    0.8106
    Hickory-Morganton-Lenoir, NC........................    0.8687    0.9081
    Honolulu, HI........................................    1.1628    1.1088
    Houston, TX.........................................    1.0017    1.0012
    Huntington-Ashland, WV-KY-OH........................    0.9353    0.9552
    Huntsville, AL......................................    0.8269    0.8780
    Indianapolis, IN....................................    0.9901    0.9932
    Iowa City, IA.......................................    0.9441    0.9614
    Jackson, MS.........................................    0.8279    0.8787
    Jackson, TN.........................................    0.8632    0.9042
    Jacksonville, FL....................................    0.8915    0.9244
    Johnson City-Kingsport-Bristol, TN-VA...............    0.8847    0.9195
    Jonesboro, AR.......................................    0.7643    0.8319
    Joplin, MO..........................................    0.7710    0.8369
    Kalamazoo-Battlecreek, MI...........................    1.1713    1.1144
    Kansas City, KS-MO..................................    0.9672    0.9774
    Knoxville, TN.......................................    0.8569    0.8996
    Lafayette, LA.......................................    0.8363    0.8848
    Lansing-East Lansing, MI............................    1.0025    1.0017
    Las Cruces, NM......................................    0.9045    0.9336
    Las Vegas, NV-AZ....................................    1.1349    1.0905
    Lexington, KY.......................................    0.8579    0.9004
    Lima, OH............................................    0.8715    0.9101
    Lincoln, NE.........................................    0.8900    0.9233
    Little Rock-North Little Rock, AR...................    0.8598    0.9017
    Los Angeles-Long Beach, CA..........................    1.2124    1.1410
    Louisville, KY-IN...................................    0.9212    0.9453
    Macon, GA...........................................    0.8886    0.9223
    Madison, WI.........................................    1.0103    1.0070
    Mansfield, OH.......................................    0.8606    0.9023
    Memphis, TN-AR-MS...................................    0.8423    0.8891
    Merced, CA..........................................    1.0304    1.0207
    Milwaukee-Waukesha, WI..............................    0.9289    0.9507
    Minneapolis-St. Paul, MN-WI.........................    1.0956    1.0645
    Modesto, CA.........................................    1.0406    1.0276
    Monroe, LA..........................................    0.8148    0.8691
    Montgomery, AL......................................    0.7919    0.8523
    Myrtle Beach, SC....................................    0.8162    0.8702
    Nashville, TN.......................................    0.9336    0.9540
    New Haven-Bridgeport-Stamford-Waterbury-Danbury, CT.    1.2175    1.1443
    New London-Norwich, CT..............................    1.1738    1.1160
    New Orleans, LA.....................................    0.9397    0.9583
    New York, NY........................................    1.4537    1.2920
    Newark, NJ..........................................    1.0899    1.0607
    Newburgh, NY-PA.....................................    1.1356    1.0910
    Oakland, CA.........................................    1.5309    1.3386
    Odessa-Midland, TX..................................    0.7773    0.8415
    Oklahoma City, OK...................................    0.8764    0.9136
    Omaha, NE-IA........................................    0.9938    0.9958
    Orange County, CA...................................    1.1153    1.0776
    Orlando, FL.........................................    0.9933    0.9954
    Peoria-Pekin, IL....................................    0.8157    0.8698
    Philadelphia, PA-NJ.................................    1.1427    1.0957
    Pittsburgh, PA......................................    0.9740    0.9821
    Pocatello, ID (Idaho Hospital)......................    0.8760    0.9133
    Pocatello, ID (Wyoming Hospitals)...................    0.8763    0.9135
    Portland, ME........................................    0.9537    0.9681
    Portland-Vancouver, OR-WA...........................    1.1274    1.0856
    Provo-Orem, UT......................................    0.9910    0.9938
    Raleigh-Durham-Chapel Hill, NC......................    0.9909    0.9938
    Rapid City, SD......................................    0.8277    0.8785
    Reno, NV............................................    1.0169    1.0115
    Rochester, MN.......................................    1.1797    1.1198
    Rockford, IL........................................    0.8703    0.9093
    Sacramento, CA......................................    1.1952    1.1299
    Saginaw-Bay City-Midland, MI........................    0.9567    0.9701
    St. Cloud, MN.......................................    0.9667    0.9771
    St. Louis, MO-IL....................................    0.9063    0.9348
    Salt Lake City-Ogden, UT............................    0.9458    0.9626
    San Diego, CA.......................................    1.2388    1.1579
    Santa Fe, NM........................................    0.9414    0.9595
    Santa Rosa, CA......................................    1.3003    1.1970
    Seattle-Bellevue-Everett, WA........................    1.1634    1.1092
    Sharon, PA..........................................    0.8835    0.9187
    Sherman-Denison, TX.................................    0.8061    0.8628
    Sioux City, IA-NE...................................    0.8530    0.8968
    Sioux Falls, SD.....................................    0.8885    0.9222
    South Bend, IN......................................    0.9939    0.9958
    Spokane, WA.........................................    1.0819    1.0554
    Springfield, IL.....................................    0.8793    0.9157
    Springfield, MO.....................................    0.8151    0.8694
    State College, PA...................................    0.8845    0.9194
    Syracuse, NY........................................    0.9410    0.9592
    Tallahassee, FL.....................................    0.8566    0.8994
    Tampa-St. Petersburg-Clearwater, FL.................    0.9179    0.9430
    Texarkana, AR-Texarkana, TX.........................    0.7538    0.8240
    Topeka, KS..........................................    0.9667    0.9771
    Tucson, AZ..........................................    0.9104    0.9377
    Tulsa, OK...........................................    0.8418    0.8888
    Tuscaloosa, AL......................................    0.7706    0.8366
    Tyler, TX...........................................    0.8792    0.9156
    Vallejo-Fairfield-Napa, CA..........................    1.3458    1.2255
    Victoria, TX........................................    0.8451    0.8911
    Washington, DC-MD-VA-WV.............................    1.0863    1.0583
    Waterloo-Cedar Falls, IA............................    0.8402    0.8876
    Wausau, WI..........................................    0.9501    0.9656
    Wichita, KS.........................................    0.8853    0.9200
    Wichita Falls, TX...................................    0.7695    0.8357
    Rural Alabama.......................................    0.7385    0.8125
    Rural Illinois......................................    0.7985    0.8572
    Rural Louisiana.....................................    0.7517    0.8225
    Rural Massachusetts.................................    1.0481    1.0327
    Rural Michigan......................................    0.8988    0.9295
    Rural Minnesota.....................................    0.8665    0.9065
    Rural Missouri......................................    0.7510    0.8219
    Rural Nevada........................................    0.8855    0.9201
    Rural New Mexico....................................    0.7927    0.8529
    Rural Oregon........................................    0.9957    0.9971
    Rural Washington....................................    1.0577    1.0392
    Rural Wyoming.......................................    0.8763    0.9135
    ------------------------------------------------------------------------
    
    
                 Table 4D.--Average Hourly Wage For Urban Areas             
    ------------------------------------------------------------------------
                                                                    Average 
                              Urban area                             hourly 
                                                                      wage  
    ------------------------------------------------------------------------
    Abilene, TX..................................................    16.4503
    Aguadilla, PR................................................     9.8326
    Akron, OH....................................................    20.5582
    Albany, GA...................................................    16.6839
    Albany-Schenectady-Troy, NY..................................    17.3615
    Albuquerque, NM..............................................    18.1579
    Alexandria, LA...............................................    17.7146
    Allentown-Bethlehem-Easton, PA...............................    21.0540
    Altoona, PA..................................................    19.3623
    Amarillo, TX.................................................    17.4756
    Anchorage, AK................................................    26.6324
    Ann Arbor, MI................................................    22.9259
    Anniston, AL.................................................    17.9884
    Appleton-Oshkosh-Neenah, WI..................................    18.3354
    Arecibo, PR..................................................    10.1277
    Asheville, NC................................................    18.5755
    Athens, GA...................................................    18.0203
    Atlanta, GA..................................................    20.6523
    Atlantic-Cape May, NJ........................................    23.3952
    Augusta-Aiken, GA-SC.........................................    19.1799
    Austin-San Marcos, TX........................................    16.8088
    Bakersfield, CA..............................................    18.4123
    Baltimore, MD................................................    20.1089
    Bangor, ME...................................................    16.5207
    Barnstable-Yarmouth, MA......................................    32.2329
    Baton Rouge, LA..............................................    18.4192
    Beaumont-Port Arthur, TX.....................................    17.8430
    Bellingham, WA...............................................    23.6418
    Benton Harbor, MI............................................    17.7241
    Bergen-Passaic, NJ...........................................    25.1292
    Billings, MT.................................................    18.9960
    Biloxi-Gulfport-Pascagoula, MS...............................    17.0828
    Binghamton, NY...............................................    18.7554
    Birmingham, AL...............................................    18.8514
    Bismarck, ND.................................................    16.5132
    Bloomington,IN...............................................    18.6271
    Bloomington-Normal, IL.......................................    18.3900
    Boise City, ID...............................................    19.0323
    Boston-Worcester-Lawrence-Lowell-Brockton, MA-NH.............    22.3344
    Boulder-Longmont, CO.........................................    20.8550
    Brazoria, TX.................................................    18.3273
    Bremerton, WA................................................    22.9686
    Brownsville-Harlingen-San Benito, TX.........................    17.0823
    Bryan-College Station, TX....................................    16.3918
    Buffalo-Niagara Falls, NY....................................    19.7621
    Burlington, VT...............................................    19.7504
    Caguas, PR...................................................     9.1371
    Canton-Massillon, OH.........................................    18.3270
    Casper, WY...................................................    18.0774
    Cedar Rapids, IA.............................................    18.3134
    Champaign-Urbana, IL.........................................    18.1242
    Charleston-North Charleston, SC..............................    18.4009
    Charleston, WV...............................................    18.6306
    
    [[Page 25646]]
    
                                                                            
    Charlotte-Gastonia-Rock Hill, NC-SC..........................    19.7132
    Charlottesville, VA..........................................    21.3425
    Chattanooga, TN-GA...........................................    18.7967
    Cheyenne, WY.................................................    19.2719
    Chicago, IL..................................................    21.6476
    Chico-Paradise, CA...........................................    21.0787
    Cincinnati, OH-KY-IN.........................................    19.5020
    Clarksville-Hopkinsville, TN-KY..............................    16.6908
    Cleveland-Lorain-Elyria, OH..................................    20.5422
    Colorado Springs, CO.........................................    19.5098
    Columbia, MO.................................................    19.9392
    Columbia, SC.................................................    19.3016
    Columbus, GA-AL..............................................    17.6626
    Columbus, OH.................................................    20.4569
    Corpus Christi, TX...........................................    16.6221
    Cumberland, MD-WV............................................    17.3219
    Dallas, TX...................................................    18.9048
    Danville, VA.................................................    18.7936
    Davenport-Moline-Rock Island, IA-IL..........................    17.5045
    Dayton-Springfield, OH.......................................    19.9239
    Daytona Beach, FL............................................    18.9775
    Decatur, AL..................................................    17.1051
    Decatur, IL..................................................    16.7703
    Denver, CO...................................................    21.6957
    Des Moines, IA...............................................    17.5941
    Detroit, MI..................................................    21.8417
    Dothan, AL...................................................    16.1254
    Dover, DE....................................................    19.4527
    Dubuque, IA..................................................    17.0843
    Duluth-Superior, MN-WI.......................................    20.7877
    Dutchess County, NY..........................................    21.5269
    Eau Claire, WI...............................................    18.0385
    El Paso, TX..................................................    18.4982
    Elkhart-Goshen, IN...........................................    18.7060
    Elmira, NY...................................................    17.5584
    Enid, OK.....................................................    16.5863
    Erie, PA.....................................................    19.2498
    Eugene-Springfield, OR.......................................    23.2566
    Evansville, Henderson, IN-KY.................................    17.5235
    Fargo-Moorhead, ND-MN........................................    15.4103
    Fayetteville, NC.............................................    17.4302
    Fayetteville-Springdale-Rogers, AR...........................    17.8965
    Flagstaff, AZ-UT.............................................    19.7008
    Flint, MI....................................................    22.8823
    Florence, AL.................................................    15.9479
    Florence, SC.................................................    17.2402
    Fort Collins-Loveland, CO....................................    21.3936
    Fort Lauderdale, FL..........................................    20.3768
    Fort Myers-Cape Coral, FL....................................    18.5790
    Fort Pierce-Port St. Lucie, FL...............................    19.9753
    Fort Smith, AR-OK............................................    15.8375
    Fort Walton Beach, FL........................................    17.8995
    Fort Wayne, IN...............................................    18.3283
    Fort Worth-Arlington, TX.....................................    18.8266
    Fresno, CA...................................................    21.6143
    Gadsden, AL..................................................    18.2411
    Gainesville, FL..............................................    19.6396
    Galveston-Texas City, TX.....................................    19.6738
    Gary, IN.....................................................    19.5496
    Glens Falls, NY..............................................    17.6404
    Goldsboro, NC................................................    17.5612
    Grand Forks, ND-MN...........................................    18.4172
    Grand Junction, CO...........................................    17.0997
    Grand Rapids-Muskegon-Holland, MI............................    20.6411
    Great Falls, MT..............................................    18.4336
    Greeley, CO..................................................    20.3075
    Green Bay, WI................................................    19.0230
    Greensboro-Winston-Salem-High Point, NC......................    19.4045
    Greenville, NC...............................................    18.6140
    Greenville-Spartanburg-Anderson, SC..........................    19.1991
    Hagerstown, MD...............................................    21.1564
    Hamilton-Middletown, OH......................................    19.1458
    Harrisburg-Lebanon-Carlisle, PA..............................    19.7220
    Hartford, CT.................................................    22.8114
    Hattiesburg, MS..............................................    15.0868
    Hickory-Morganton-Lenoir, NC.................................    18.4430
    Honolulu, HI.................................................    23.9579
    Houma, LA....................................................    17.0314
    Houston, TX..................................................    20.6380
    Huntington-Ashland, WV-KY-OH.................................    20.0441
    Huntsville, AL...............................................    17.3657
    Indianapolis, IN.............................................    20.3998
    Iowa City, IA................................................    19.6992
    Jackson, MI..................................................    19.1645
    Jackson, MS..................................................    17.0541
    Jackson, TN..................................................    17.7852
    Jacksonville, FL.............................................    18.3674
    Jacksonville, NC.............................................    15.6996
    Jamestown, NY................................................    15.9060
    Janesville-Beloit, WI........................................    18.8060
    Jersey City, NJ..............................................    23.4307
    Johnson City-Kingsport-Bristol, TN-VA........................    18.2276
    Johnstown, PA................................................    17.8659
    Jonesboro, AR................................................    15.3904
    Joplin, MO...................................................    16.3448
    Kalamazoo-Battlecreek, MI....................................    24.7428
    Kankakee, IL.................................................    18.9037
    Kansas City, KS-MO...........................................    19.9286
    Kenosha, WI..................................................    18.9676
    Killeen-Temple, TX...........................................    20.9746
    Knoxville, TN................................................    17.6557
    Kokomo, IN...................................................    19.2639
    La Crosse, WI-MN.............................................    18.5196
    Lafayette, LA................................................    17.1506
    Lafayette, IN................................................    18.3693
    Lake Charles, LA.............................................    15.9437
    Lakeland-Winter Haven, FL....................................    18.5691
    Lancaster, PA................................................    19.8739
    Lansing-East Lansing, MI.....................................    20.8707
    Laredo, TX...................................................    15.2064
    Las Cruces, NM...............................................    18.4298
    Las Vegas, NV-AZ.............................................    23.3827
    Lawrence, KS.................................................    17.9827
    Lawton, OK...................................................    18.0698
    Lewiston-Auburn, ME..........................................    19.0090
    Lexington, KY................................................    17.6767
    Lima, OH.....................................................    18.3062
    Lincoln, NE..................................................    18.7127
    Little Rock-North Little Rock, AR............................    17.6667
    Longview-Marshall, TX........................................    17.6848
    Los Angeles-Long Beach, CA...................................    24.9118
    Louisville, KY-IN............................................    18.9791
    Lubbock, TX..................................................    17.4301
    Lynchburg, VA................................................    17.8831
    Macon, GA....................................................    18.7672
    Madison, WI..................................................    20.8155
    Mansfield, OH................................................    17.7321
    Mayaguez, PR.................................................     8.9825
    McAllen-Edinburg-Mission, TX.................................    17.5983
    Medford-Ashland, OR..........................................    20.8288
    Melbourne-Titusville-Palm Bay, FL............................    19.1394
    Memphis, TN-AR-MS............................................    17.3550
    Merced, CA...................................................    20.8449
    Miami, FL....................................................    20.7248
    Middlesex-Somerset-Hunterdon, NJ.............................    23.1938
    Milwaukee-Waukesha, WI.......................................    19.5106
    Minneapolis-St. Paul, MN-WI..................................    22.5733
    Mobile, AL...................................................    16.3627
    Modesto, CA..................................................    21.4409
    Monmouth-Ocean, NJ...........................................    23.2510
    Monroe, LA...................................................    17.0762
    Montgomery, AL...............................................    16.2493
    Muncie, IN...................................................    19.5589
    Myrtle Beach, SC.............................................    16.4379
    Naples, FL...................................................    21.0253
    Nashville, TN................................................    19.2358
    Nassau-Suffolk, NY...........................................    28.5558
    New Haven-Bridgeport-Stamford-Waterbury-Danbury, CT..........    24.7905
    New London-Norwich, CT.......................................    24.1351
    New Orleans, LA..............................................    19.3612
    New York, NY.................................................    29.9516
    Newark, NJ...................................................    24.1961
    Newburgh, NY-PA..............................................    23.1287
    Norfolk-Virginia Beach-Newport News, VA-NC...................    16.9674
    Oakland, CA..................................................    31.0918
    Ocala, FL....................................................    19.0159
    Odessa-Midland, TX...........................................    16.0153
    Oklahoma City, OK............................................    18.0573
    Olympia, WA..................................................    23.9108
    Omaha, NE-IA.................................................    20.4749
    Orange County, CA............................................    23.1127
    Orlando, FL..................................................    20.4664
    Owensboro, KY................................................    16.1460
    Panama City, FL..............................................    17.6753
    Parkersburg-Marietta, WV-OH..................................    16.7267
    Pensacola, FL................................................    16.9466
    Peoria-Pekin, IL.............................................    16.7415
    Philadelphia, PA-NJ..........................................    23.5434
    Phoenix-Mesa, AZ.............................................    20.1062
    Pine Bluff, AR...............................................    16.4882
    Pittsburgh, PA...............................................    20.3893
    Pittsfield, MA...............................................    22.4781
    Pocatello, ID................................................    18.0491
    Ponce, PR....................................................     9.7656
    Portland, ME.................................................    19.6358
    Portland-Vancouver, OR-WA....................................    23.2280
    Providence-Warwick, RI.......................................    22.4328
    Provo-Orem, UT...............................................    20.4158
    Pueblo, CO...................................................    18.1010
    Punta Gorda, FL..............................................    18.5303
    Racine, WI...................................................    18.9689
    Raleigh-Durham-Chapel Hill, NC...............................    20.4162
    Rapid City, SD...............................................    17.0546
    Reading, PA..................................................    19.1241
    Redding, CA..................................................    24.7586
    Reno, NV.....................................................    20.9521
    Richland-Kennewick-Pasco, WA.................................    21.3732
    Richmond-Petersburg, VA......................................    19.0728
    Riverside-San Bernardino, CA.................................    21.3055
    Roanoke, VA..................................................    17.6802
    Rochester, MN................................................    24.3054
    Rochester, NY................................................    19.9396
    Rockford, IL.................................................    17.9308
    Rocky Mount, NC..............................................    18.5969
    Sacramento, CA...............................................    24.6188
    Saginaw-Bay City-Midland, MI.................................    19.7109
    St. Cloud, MN................................................    19.9167
    
    [[Page 25647]]
    
                                                                            
    St. Joseph, MO...............................................    20.5465
    St. Louis, MO-IL.............................................    18.6721
    Salem, OR....................................................    20.5776
    Salinas, CA..................................................    31.4614
    Salt Lake City-Ogden, UT.....................................    19.4515
    San Angelo, TX...............................................    15.4776
    San Antonio, TX..............................................    15.9548
    San Diego, CA................................................    25.4297
    San Francisco, CA............................................    28.9991
    San Jose, CA.................................................    28.6758
    San Juan-Bayamon, PR.........................................     9.3148
    San Luis Obispo-Atascadero-Paso Robles, CA...................    22.3026
    Santa Barbara-Santa Maria-Lompoc, CA.........................    23.1439
    Santa Cruz-Watsonville, CA...................................    29.0487
    Santa Fe, NM.................................................    19.6247
    Santa Rosa, CA...............................................    28.2324
    Sarasota-Bradenton, FL.......................................    19.7119
    Savannah, GA.................................................    18.0808
    Scranton-Wilkes Barre-Hazleton, PA...........................    17.5663
    Seattle-Bellevue-Everett, WA.................................    23.9527
    Sharon, PA...................................................    18.4366
    Sheboygan, WI................................................    17.0899
    Sherman-Denison, TX..........................................    16.9538
    Shreveport-Bossier City, LA..................................    19.4408
    Sioux City, IA-NE............................................    17.5754
    Sioux Falls, SD..............................................    18.5187
    South Bend, IN...............................................    20.4772
    Spokane, WA..................................................    22.7055
    Springfield, IL..............................................    18.1176
    Springfield, MO..............................................    16.7941
    Springfield, MA..............................................    22.7477
    State College, PA............................................    19.6319
    Steubenville-Weirton, OH-WV..................................    17.4636
    Stockton-Lodi, CA............................................    22.9869
    Sumter, SC...................................................    16.8850
    Syracuse, NY.................................................    19.3881
    Tacoma, WA...................................................    21.5661
    Tallahassee, FL..............................................    17.5545
    Tampa-St. Petersburg-Clearwater, FL..........................    18.7444
    Terre Haute, IN..............................................    18.6722
    Texarkana, AR-Texarkana, TX..................................    14.8193
    Toledo, OH...................................................    20.8755
    Topeka, KS...................................................    20.3862
    Trenton, NJ..................................................    21.4255
    Tucson, AZ...................................................    18.7576
    Tulsa, OK....................................................    17.5538
    Tuscaloosa, AL...............................................    15.8762
    Tyler, TX....................................................    18.1141
    Utica-Rome, NY...............................................    17.2785
    Vallejo-Fairfield-Napa, CA...................................    27.9551
    Ventura, CA..................................................    22.7487
    Victoria, TX.................................................    17.4131
    Vineland-Millville-Bridgeton, NJ.............................    21.5511
    Visalia-Tulare-Porterville, CA...............................    20.9493
    Waco, TX.....................................................    16.5375
    Washington, DC-MD-VA-WV......................................    22.3812
    Waterloo-Cedar Falls, IA.....................................    16.5347
    Wausau, WI...................................................    20.2214
    West Palm Beach-Boca Raton, FL...............................    21.2686
    Wheeling, OH-WV..............................................    15.8460
    Wichita, KS..................................................    18.5231
    Wichita Falls, TX............................................    16.2020
    Williamsport, PA.............................................    17.5305
    Wilmington-Newark, DE-MD.....................................    24.6591
    Wilmington, NC...............................................    19.4232
    Yakima, WA...................................................    21.4371
    Yolo, CA.....................................................    22.0507
    York, PA.....................................................    19.5923
    Youngstown-Warren, OH........................................    20.3921
    Yuba City, CA................................................    22.5751
    Yuma, AZ.....................................................    20.8977
    ------------------------------------------------------------------------
    
    
                 Table 4E.--Average Hourly Wage for Rural Areas             
    ------------------------------------------------------------------------
                                                                    Average 
                            Nonurban area                            hourly 
                                                                      wage  
    ------------------------------------------------------------------------
    Alabama......................................................    15.1489
    Alaska.......................................................    25.8250
    Arizona......................................................    16.6528
    Arkansas.....................................................    14.9880
    California...................................................    20.5534
    Colorado.....................................................    17.4187
    Connecticut..................................................    25.0854
    Delaware.....................................................    17.6976
    Florida......................................................    18.4340
    Georgia......................................................    16.3451
    Hawaii.......................................................    22.6872
    Idaho........................................................    17.6124
    Illinois.....................................................    16.4317
    Indiana......................................................    17.3659
    Iowa.........................................................    16.1658
    Kansas.......................................................    15.1110
    Kentucky.....................................................    16.2801
    Louisiana....................................................    15.4622
    Maine........................................................    17.5914
    Maryland.....................................................    17.7750
    Massachusetts................................................    22.4920
    Michigan.....................................................    18.5026
    Minnesota....................................................    17.8522
    Mississippi..................................................    15.1615
    Missouri.....................................................    15.4743
    Montana......................................................    17.8114
    Nebraska.....................................................    15.8291
    Nevada.......................................................    19.0933
    New Hampshire................................................    21.2716
    New Jersey \1\...............................................  .........
    New Mexico...................................................    16.3322
    New York.....................................................    17.8012
    North Carolina...............................................    16.8177
    North Dakota.................................................    15.3932
    Ohio.........................................................    17.6689
    Oklahoma.....................................................    14.8488
    Oregon.......................................................    20.5099
    Pennsylvania.................................................    17.7499
    Puerto Rico..................................................     8.4134
    Rhode Island \1\.............................................  .........
    South Carolina...............................................    16.7085
    South Dakota.................................................    15.5851
    Tennessee....................................................    15.4168
    Texas........................................................    15.2542
    Utah.........................................................    18.2372
    Vermont......................................................    19.5500
    Virginia.....................................................    16.2563
    Washington...................................................    21.7931
    West Virginia................................................    16.3543
    Wisconsin....................................................    17.6308
    Wyoming......................................................   18.0559 
    ------------------------------------------------------------------------
    \1\ All counties within the State are classified as urban.              
    
    
                     Table 4F.--Puerto Rico Wage Index and Capital Geogaphic Adjustment Factor (GAF)                
    ----------------------------------------------------------------------------------------------------------------
                                                                                        Wage index--                
                             Area                            Wage index      GAF          Reclass.     GAF--Reclass.
                                                                                         hospitals       hospitals  
    ----------------------------------------------------------------------------------------------------------------
    Aguadilla, PR.........................................       1.0534       1.0363  ...............  .............
    Arecibo, PR...........................................       1.0850       1.0575  ...............  .............
    Caguas, PR............................................       0.9812       0.9871         0.9812          0.9871 
    Mayaguez, PR..........................................       0.9624       0.9741  ...............  .............
    Ponce, PR.............................................       1.0462       1.0314  ...............  .............
    San Juan-Bayamon, PR..................................       0.9980       0.9986  ...............  .............
    Rural Puerto Rico.....................................       0.9014       0.9314  ...............  .............
    ----------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25648]]
    
    
      Table 5.--List of Diagnosis Related Groups (DRGS), Relative Weighting Factors, Geometric and Arithmetic Mean  
                                                     Length of Stay                                                 
    ----------------------------------------------------------------------------------------------------------------
                                                                                   Relative    Geometric  Arithmetic
                                                                                    weights    mean LOS    mean LOS 
    ----------------------------------------------------------------------------------------------------------------
    1...............       01  SURG                  CRANIOTOMY AGE >17 EXCEPT        3.0645         6.8         9.6
                                                      FOR TRAUMA.                                                   
    2...............       01  SURG                  CRANIOTOMY FOR TRAUMA AGE        3.1009         7.5        10.1
                                                      >17.                                                          
    3...............       01  SURG                  *CRANIOTOMY AGE 0-17.......      1.9573        12.7        12.7
    4...............       01  SURG                  SPINAL PROCEDURES..........      2.3259         5.1         7.7
    5...............       01  SURG                  EXTRACRANIAL VASCULAR            1.4845         2.7         3.6
                                                      PROCEDURES.                                                   
    6...............       01  SURG                  CARPAL TUNNEL RELEASE......       .7763         2.1         3.0
    7...............       01  SURG                  PERIPH & CRANIAL NERVE &         2.3911         6.8        10.1
                                                      OTHER NERV SYST PROC W CC.                                    
    8...............       01  SURG                  PERIPH & CRANIAL NERVE &         1.2891         2.2         3.2
                                                      OTHER NERV SYST PROC W/O                                      
                                                      CC.                                                           
    9...............       01  MED                   SPINAL DISORDERS & INJURIES      1.2867         4.8         6.6
    10..............       01  MED                   NERVOUS SYSTEM NEOPLASMS W       1.2113         5.1         7.0
                                                      CC.                                                           
    11..............       01  MED                   NERVOUS SYSTEM NEOPLASMS W/       .8233         3.1         4.2
                                                      O CC.                                                         
    12..............       01  MED                   DEGENERATIVE NERVOUS SYSTEM       .9034         4.8         6.7
                                                      DISORDERS.                                                    
    13..............       01  MED                   MULTIPLE SCLEROSIS &              .7792         4.4         5.5
                                                      CEREBELLAR ATAXIA.                                            
    14..............       01  MED                   SPECIFIC CEREBROVASCULAR         1.1973         4.9         6.4
                                                      DISORDERS EXCEPT TIA.                                         
    15..............       01  MED                   TRANSIENT ISCHEMIC ATTACK &       .7327         3.1         3.9
                                                      PRECEREBRAL OCCLUSIONS.                                       
    16..............       01  MED                   NONSPECIFIC CEREBROVASCULAR      1.0715         4.5         5.9
                                                      DISORDERS W CC.                                               
    17..............       01  MED                   NONSPECIFIC CEREBROVASCULAR       .6186         2.7         3.4
                                                      DISORDERS W/O CC.                                             
    18..............       01  MED                   CRANIAL & PERIPHERAL NERVE        .9285         4.3         5.6
                                                      DISORDERS W CC.                                               
    19..............       01  MED                   CRANIAL & PERIPHERAL NERVE        .6463         3.0         3.8
                                                      DISORDERS W/O CC.                                             
    20..............       01  MED                   NERVOUS SYSTEM INFECTION         2.6134         7.9        10.5
                                                      EXCEPT VIRAL MENINGITIS.                                      
    21..............       01  MED                   VIRAL MENINGITIS...........      1.4785         5.1         6.8
    22..............       01  MED                   HYPERTENSIVE ENCEPHALOPATHY       .8984         3.6         4.7
    23..............       01  MED                   NONTRAUMATIC STUPOR & COMA.       .7776         3.2         4.3
    24..............       01  MED                   SEIZURE & HEADACHE AGE >17        .9579         3.8         5.1
                                                      W CC.                                                         
    25..............       01  MED                   SEIZURE & HEADACHE AGE >17        .5905         2.7         3.4
                                                      W/O CC.                                                       
    26..............       01  MED                   SEIZURE & HEADACHE AGE 0-17       .6950         2.4         3.1
    27..............       01  MED                   TRAUMATIC STUPOR & COMA,         1.3017         3.4         5.3
                                                      COMA >1 HR.                                                   
    28..............       01  MED                   TRAUMATIC STUPOR & COMA,         1.1699         4.3         6.0
                                                      COMA <1 hr="" age="">17 W CC.                                      
    29..............       01  MED                   TRAUMATIC STUPOR & COMA,          .6370         2.7         3.6
                                                      COMA <1 hr="" age="">17 W/O CC.                                    
    30..............       01  MED                   *TRAUMATIC STUPOR & COMA,         .3310         2.0         2.0
                                                      COMA <1 hr="" age="" 0-17.="" 31..............="" 01="" med="" concussion="" age="">17 W CC....       .8039         3.2         4.4
    32..............       01  MED                   CONCUSSION AGE >17 W/O CC..       .5138         2.2         3.0
    33..............       01  MED                   *CONCUSSION AGE 0-17.......       .2080         1.6         1.6
    34..............       01  MED                   OTHER DISORDERS OF NERVOUS       1.0067         4.1         5.5
                                                      SYSTEM W CC.                                                  
    35..............       01  MED                   OTHER DISORDERS OF NERVOUS        .5915         2.7         3.6
                                                      SYSTEM W/O CC.                                                
    36..............       02  SURG                  RETINAL PROCEDURES.........       .6873         1.3         1.5
    37..............       02  SURG                  ORBITAL PROCEDURES.........       .9614         2.5         3.7
    38..............       02  SURG                  PRIMARY IRIS PROCEDURES....       .4876         1.9         2.6
    39..............       02  SURG                  LENS PROCEDURES WITH OR           .5686         1.5         2.0
                                                      WITHOUT VITRECTOMY.                                           
    40..............       02  SURG                  EXTRAOCULAR PROCEDURES            .7937         2.1         3.2
                                                      EXCEPT ORBIT AGE >17.                                         
    41..............       02  SURG                  *EXTRAOCULAR PROCEDURES           .3369         1.6         1.6
                                                      EXCEPT ORBIT AGE 0-17.                                        
    42..............       02  SURG                  INTRAOCULAR PROCEDURES            .6034         1.6         2.1
                                                      EXCEPT RETINA, IRIS & LENS.                                   
    43..............       02  MED                   HYPHEMA....................       .4370         2.7         3.4
    44..............       02  MED                   ACUTE MAJOR EYE INFECTIONS.       .6100         4.2         5.1
    45..............       02  MED                   NEUROLOGICAL EYE DISORDERS.       .6822         2.8         3.5
    46..............       02  MED                   OTHER DISORDERS OF THE EYE        .7546         3.6         4.7
                                                      AGE >17 W CC.                                                 
    47..............       02  MED                   OTHER DISORDERS OF THE EYE        .4618         2.5         3.3
                                                      AGE >17 W/O CC.                                               
    48..............       02  MED                   *OTHER DISORDERS OF THE EYE       .2969         2.9         2.9
                                                      AGE 0-17.                                                     
    49..............       03  SURG                  MAJOR HEAD & NECK                1.7597         3.7         5.0
                                                      PROCEDURES.                                                   
    50..............       03  SURG                  SIALOADENECTOMY............       .8288         1.6         2.0
    51..............       03  SURG                  SALIVARY GLAND PROCEDURES         .8590         1.8         2.8
                                                      EXCEPT SIALOADENECTOMY.                                       
    52..............       03  SURG                  CLEFT LIP & PALATE REPAIR..       .9567         2.0         2.8
    53..............       03  SURG                  SINUS & MASTOID PROCEDURES       1.1402         2.3         3.7
                                                      AGE >17.                                                      
    54..............       03  SURG                  *SINUS & MASTOID PROCEDURES       .4812         3.2         3.2
                                                      AGE 0-17.                                                     
    55..............       03  SURG                  MISCELLANEOUS EAR, NOSE,          .8886         2.0         3.0
                                                      MOUTH & THROAT PROCEDURES.                                    
    56..............       03  SURG                  RHINOPLASTY................       .9008         2.1         2.8
    57..............       03  SURG                  T&A PROC, EXCEPT                  .9381         2.6         3.7
                                                      TONSILLECTOMY &/OR                                            
                                                      ADENOIDECTOMY ONLY, AGE                                       
                                                      >17.                                                          
    58..............       03  SURG                  *T&A PROC, EXCEPT                 .2732         1.5         1.5
                                                      TONSILLECTOMY &/OR                                            
                                                      ADENOIDECTOMY ONLY, AGE 0-                                    
                                                      17.                                                           
    59..............       03  SURG                  TONSILLECTOMY &/OR                .6750         1.8         2.4
                                                      ADENOIDECTOMY ONLY, AGE                                       
                                                      >17.                                                          
    60..............       03  SURG                  *TONSILLECTOMY &/OR               .2081         1.5         1.5
                                                      ADENOIDECTOMY ONLY, AGE 0-                                    
                                                      17.                                                           
    61..............       03  SURG                  MYRINGOTOMY W TUBE               1.1456         2.6         4.5
                                                      INSERTION AGE >17.                                            
    62..............       03  SURG                  *MYRINGOTOMY W TUBE               .2946         1.3         1.3
                                                      INSERTION AGE 0-17.                                           
    63..............       03  SURG                  OTHER EAR, NOSE, MOUTH &         1.3248         3.0         4.4
                                                      THROAT O.R. PROCEDURES.                                       
    64..............       03  MED                   EAR, NOSE, MOUTH & THROAT        1.2201         4.4         6.8
                                                      MALIGNANCY.                                                   
    65..............       03  MED                   DYSEQUILIBRIUM.............       .5173         2.4         3.0
    66..............       03  MED                   EPISTAXIS..................       .5418         2.6         3.3
    67..............       03  MED                   EPIGLOTTITIS...............       .8230         3.0         3.8
    68..............       03  MED                   OTITIS MEDIA & URI AGE >17        .6733         3.4         4.2
                                                      W CC.                                                         
    
    [[Page 25649]]
    
                                                                                                                    
    69..............       03  MED                   OTITIS MEDIA & URI AGE >17        .5076         2.7         3.3
                                                      W/O CC.                                                       
    70..............       03  MED                   OTITIS MEDIA & URI AGE 0-17       .3860         2.1         2.5
    71..............       03  MED                   LARYNGOTRACHEITIS..........       .7663         3.2         4.0
    72..............       03  MED                   NASAL TRAUMA & DEFORMITY...       .6534         2.8         3.8
    73..............       03  MED                   OTHER EAR, NOSE, MOUTH &          .7507         3.3         4.4
                                                      THROAT DIAGNOSES AGE >17.                                     
    74..............       03  MED                   *OTHER EAR, NOSE, MOUTH &         .3347         2.1         2.1
                                                      THROAT DIAGNOSES AGE 0-17.                                    
    75..............       04  SURG                  MAJOR CHEST PROCEDURES.....      3.1785         8.1        10.2
    76..............       04  SURG                  OTHER RESP SYSTEM O.R.           2.6860         8.4        11.3
                                                      PROCEDURES W CC.                                              
    77..............       04  SURG                  OTHER RESP SYSTEM O.R.           1.1569         3.4         4.9
                                                      PROCEDURES W/O CC.                                            
    78..............       04  MED                   PULMONARY EMBOLISM.........      1.4068         6.3         7.4
    79..............       04  MED                   RESPIRATORY INFECTIONS &         1.6331         6.7         8.4
                                                      INFLAMMATIONS AGE >17 W CC.                                   
    80..............       04  MED                   RESPIRATORY INFECTIONS &          .9177         4.7         5.9
                                                      INFLAMMATIONS AGE >17 W/O                                     
                                                      CC.                                                           
    81..............       04  MED                   *RESPIRATORY INFECTIONS &        1.5160         6.1         6.1
                                                      INFLAMMATIONS AGE 0-17.                                       
    82..............       04  MED                   RESPIRATORY NEOPLASMS......      1.3628         5.3         7.2
    83..............       04  MED                   MAJOR CHEST TRAUMA W CC....       .9508         4.4         5.6
    84..............       04  MED                   MAJOR CHEST TRAUMA W/O CC..       .5041         2.7         3.3
    85..............       04  MED                   PLEURAL EFFUSION W CC......      1.2361         5.1         6.7
    86..............       04  MED                   PLEURAL EFFUSION W/O CC....       .6843         3.0         3.9
    87..............       04  MED                   PULMONARY EDEMA &                1.3672         4.8         6.4
                                                      RESPIRATORY FAILURE.                                          
    88..............       04  MED                   CHRONIC OBSTRUCTIVE               .9558         4.4         5.4
                                                      PULMONARY DISEASE.                                            
    89..............       04  MED                   SIMPLE PNEUMONIA & PLEURISY      1.0865         5.2         6.3
                                                      AGE >17 W CC.                                                 
    90..............       04  MED                   SIMPLE PNEUMONIA & PLEURISY       .6669         3.8         4.5
                                                      AGE >17 W/O CC.                                               
    91..............       04  MED                   SIMPLE PNEUMONIA & PLEURISY       .7210         3.3         4.0
                                                      AGE 0-17.                                                     
    92..............       04  MED                   INTERSTITIAL LUNG DISEASE W      1.2047         5.1         6.4
                                                      CC.                                                           
    93..............       04  MED                   INTERSTITIAL LUNG DISEASE W/      .7722         3.5         4.4
                                                      O CC.                                                         
    94..............       04  MED                   PNEUMOTHORAX W CC..........      1.1904         4.9         6.5
    95..............       04  MED                   PNEUMOTHORAX W/O CC........       .6060         3.1         3.9
    96..............       04  MED                   BRONCHITIS & ASTHMA AGE >17       .7917         4.0         4.9
                                                      W CC.                                                         
    97..............       04  MED                   BRONCHITIS & ASTHMA AGE >17       .5942         3.2         3.8
                                                      W/O CC.                                                       
    98..............       04  MED                   BRONCHITIS & ASTHMA AGE 0-        .6921         3.6         4.9
                                                      17.                                                           
    99..............       04  MED                   RESPIRATORY SIGNS &               .6739         2.3         3.0
                                                      SYMPTOMS W CC.                                                
    100.............       04  MED                   RESPIRATORY SIGNS &               .5155         1.7         2.1
                                                      SYMPTOMS W/O CC.                                              
    101.............       04  MED                   OTHER RESPIRATORY SYSTEM          .8304         3.3         4.4
                                                      DIAGNOSES W CC.                                               
    102.............       04  MED                   OTHER RESPIRATORY SYSTEM          .5402         2.2         2.8
                                                      DIAGNOSES W/O CC.                                             
    103.............       05  SURG                  HEART TRANSPLANT...........     16.8723        30.4        48.1
    104.............       05  SURG                  CARDIAC VALVE & OTH MAJ          7.2756         9.9        12.5
                                                      CARDIOTHORACIC PROC W CARD                                    
                                                      CATH.                                                         
    105.............       05  SURG                  CARDIAC VALVE & OTH MAJ          5.7011         7.9         9.7
                                                      CARDIOTHORACIC PROC W/O                                       
                                                      CARD CATH.                                                    
    106.............       05  SURG                  CORONARY BYPASS WITH PTCA..      7.3400         9.2        10.9
    107.............       05  SURG                  CORONARY BYPASS W CARDIAC        5.4891         9.5        10.7
                                                      CATH.                                                         
    108.............       05  SURG                  OTHER CARDIOTHORACIC             5.9512         8.6        11.3
                                                      PROCEDURES.                                                   
    109.............       05  SURG                  CORONARY BYPASS W/O CARDIAC      4.0670         7.0         8.0
                                                      CATH.                                                         
    110.............       05  SURG                  MAJOR CARDIOVASCULAR             4.1419         7.4         9.7
                                                      PROCEDURES W CC.                                              
    111.............       05  SURG                  MAJOR CARDIOVASCULAR             2.2188         5.1         5.9
                                                      PROCEDURES W/O CC.                                            
    112.............       05  SURG                  PERCUTANEOUS CARDIOVASCULAR      1.9862         2.8         3.9
                                                      PROCEDURES.                                                   
    113.............       05  SURG                  AMPUTATION FOR CIRC SYSTEM       2.7407         9.8        13.0
                                                      DISORDERS EXCEPT UPPER                                        
                                                      LIMB & TOE.                                                   
    114.............       05  SURG                  UPPER LIMB & TOE AMPUTATION      1.5023         6.0         8.4
                                                      FOR CIRC SYSTEM DISORDERS.                                    
    115.............       05  SURG                  PERM PACE IMPLNT W AMI, HRT      3.5531         6.4         8.8
                                                      FAIL OR SHOCK OR AICD LEAD                                    
                                                      OR GEN PROC.                                                  
    116.............       05  SURG                  OTH PERM CARDIAC PACEMAKER       2.4811         3.0         4.2
                                                      IMPLANT OR PTCA W CORONARY                                    
                                                      ART STENT.                                                    
    117.............       05  SURG                  CARDIAC PACEMAKER REVISION       1.2368         2.7         4.0
                                                      EXCEPT DEVICE REPLACEMENT.                                    
    118.............       05  SURG                  CARDIAC PACEMAKER DEVICE         1.5711         2.0         2.9
                                                      REPLACEMENT.                                                  
    119.............       05  SURG                  VEIN LIGATION & STRIPPING..      1.2960         3.2         5.4
    120.............       05  SURG                  OTHER CIRCULATORY SYSTEM         1.9568         4.9         8.2
                                                      O.R. PROCEDURES.                                              
    121.............       05  MED                   CIRCULATORY DISORDERS W AMI      1.6354         5.7         7.0
                                                      & MAJOR COMP DISCH ALIVE.                                     
    122.............       05  MED                   CIRCULATORY DISORDERS W AMI      1.1299         3.6         4.4
                                                      W/O MAJOR COMP DISCH ALIVE.                                   
    123.............       05  MED                   CIRCULATORY DISORDERS W          1.4874         2.7         4.4
                                                      AMI, EXPIRED.                                                 
    124.............       05  MED                   CIRCULATORY DISORDERS            1.3790         3.5         4.5
                                                      EXCEPT AMI, W CARD CATH &                                     
                                                      COMPLEX DIAG.                                                 
    125.............       05  MED                   CIRCULATORY DISORDERS            1.0130         2.2         2.9
                                                      EXCEPT AMI, W CARD CATH W/                                    
                                                      O COMPLEX DIAG.                                               
    126.............       05  MED                   ACUTE & SUBACUTE                 2.5820         9.7        12.7
                                                      ENDOCARDITIS.                                                 
    127.............       05  MED                   HEART FAILURE & SHOCK......      1.0143         4.3         5.5
    128.............       05  MED                   DEEP VEIN THROMBOPHLEBITIS.       .7671         5.3         6.0
    129.............       05  MED                   CARDIAC ARREST, UNEXPLAINED      1.0878         1.8         3.0
    130.............       05  MED                   PERIPHERAL VASCULAR               .9435         4.9         6.0
                                                      DISORDERS W CC.                                               
    131.............       05  MED                   PERIPHERAL VASCULAR               .6077         3.9         4.7
                                                      DISORDERS W/O CC.                                             
    
    [[Page 25650]]
    
                                                                                                                    
    132.............       05  MED                   ATHEROSCLEROSIS W CC.......       .6711         2.5         3.2
    133.............       05  MED                   ATHEROSCLEROSIS W/O CC.....       .5562         2.0         2.5
    134.............       05  MED                   HYPERTENSION...............       .5838         2.7         3.5
    135.............       05  MED                   CARDIAC CONGENITAL &              .8519         3.3         4.4
                                                      VALVULAR DISORDERS AGE >17                                    
                                                      W CC.                                                         
    136.............       05  MED                   CARDIAC CONGENITAL &              .5766         2.4         3.0
                                                      VALVULAR DISORDERS AGE >17                                    
                                                      W/O CC.                                                       
    137.............       05  MED                   *CARDIAC CONGENITAL &             .8168         3.3         3.3
                                                      VALVULAR DISORDERS AGE 0-                                     
                                                      17.                                                           
    138.............       05  MED                   CARDIAC ARRHYTHMIA &              .8012         3.1         4.1
                                                      CONDUCTION DISORDERS W CC.                                    
    139.............       05  MED                   CARDIAC ARRHYTHMIA &              .4981         2.1         2.6
                                                      CONDUCTION DISORDERS W/O                                      
                                                      CC.                                                           
    140.............       05  MED                   ANGINA PECTORIS............       .5973         2.4         3.0
    141.............       05  MED                   SYNCOPE & COLLAPSE W CC....       .7029         3.0         3.9
    142.............       05  MED                   SYNCOPE & COLLAPSE W/O CC..       .5316         2.2         2.8
    143.............       05  MED                   CHEST PAIN.................       .5265         1.8         2.3
    144.............       05  MED                   OTHER CIRCULATORY SYSTEM         1.1123         3.8         5.3
                                                      DIAGNOSES W CC.                                               
    145.............       05  MED                   OTHER CIRCULATORY SYSTEM          .6305         2.2         2.9
                                                      DIAGNOSES W/O CC.                                             
    146.............       06  SURG                  RECTAL RESECTION W CC......      2.7210         9.0        10.3
    147.............       06  SURG                  RECTAL RESECTION W/O CC....      1.5887         6.1         6.7
    148.............       06  SURG                  MAJOR SMALL & LARGE BOWEL        3.4239        10.3        12.3
                                                      PROCEDURES W CC.                                              
    149.............       06  SURG                  MAJOR SMALL & LARGE BOWEL        1.5698         6.3         6.9
                                                      PROCEDURES W/O CC.                                            
    150.............       06  SURG                  PERITONEAL ADHESIOLYSIS W        2.7465         8.9        10.9
                                                      CC.                                                           
    151.............       06  SURG                  PERITONEAL ADHESIOLYSIS W/O      1.2832         4.8         5.9
                                                      CC.                                                           
    152.............       06  SURG                  MINOR SMALL & LARGE BOWEL        1.9427         7.0         8.3
                                                      PROCEDURES W CC.                                              
    153.............       06  SURG                  MINOR SMALL & LARGE BOWEL        1.1905         5.1         5.6
                                                      PROCEDURES W/O CC.                                            
    154.............       06  SURG                  STOMACH, ESOPHAGEAL &            4.1849        10.3        13.4
                                                      DUODENAL PROCEDURES AGE                                       
                                                      >17 W CC.                                                     
    155.............       06  SURG                  STOMACH, ESOPHAGEAL &            1.3570         3.6         4.7
                                                      DUODENAL PROCEDURES AGE                                       
                                                      >17 W/O CC.                                                   
    156.............       06  SURG                  *STOMACH, ESOPHAGEAL &            .8412         6.0         6.0
                                                      DUODENAL PROCEDURES AGE 0-                                    
                                                      17.                                                           
    157.............       06  SURG                  ANAL & STOMAL PROCEDURES W       1.2071         3.9         5.4
                                                      CC.                                                           
    158.............       06  SURG                  ANAL & STOMAL PROCEDURES W/       .6434         2.1         2.6
                                                      O CC.                                                         
    159.............       06  SURG                  HERNIA PROCEDURES EXCEPT         1.2873         3.7         5.0
                                                      INGUINAL & FEMORAL AGE >17                                    
                                                      W CC.                                                         
    160.............       06  SURG                  HERNIA PROCEDURES EXCEPT          .7413         2.2         2.7
                                                      INGUINAL & FEMORAL AGE >17                                    
                                                      W/O CC.                                                       
    161.............       06  SURG                  INGUINAL & FEMORAL HERNIA        1.0742         2.9         4.1
                                                      PROCEDURES AGE >17 W CC.                                      
    162.............       06  SURG                  INGUINAL & FEMORAL HERNIA         .6129         1.7         2.0
                                                      PROCEDURES AGE >17 W/O CC.                                    
    163.............       06  SURG                  *HERNIA PROCEDURES AGE 0-17       .8700         2.1         2.1
    164.............       06  SURG                  APPENDECTOMY W COMPLICATED       2.3206         7.3         8.5
                                                      PRINCIPAL DIAG W CC.                                          
    165.............       06  SURG                  APPENDECTOMY W COMPLICATED       1.2301         4.3         5.0
                                                      PRINCIPAL DIAG W/O CC.                                        
    166.............       06  SURG                  APPENDECTOMY W/O                 1.4518         4.0         5.1
                                                      COMPLICATED PRINCIPAL DIAG                                    
                                                      W CC.                                                         
    167.............       06  SURG                  APPENDECTOMY W/O                  .8548         2.4         2.8
                                                      COMPLICATED PRINCIPAL DIAG                                    
                                                      W/O CC.                                                       
    168.............       03  SURG                  MOUTH PROCEDURES W CC......      1.1593         3.1         4.6
    169.............       03  SURG                  MOUTH PROCEDURES W/O CC....       .7155         1.9         2.5
    170.............       06  SURG                  OTHER DIGESTIVE SYSTEM O.R.      2.8008         7.9        11.3
                                                      PROCEDURES W CC.                                              
    171.............       06  SURG                  OTHER DIGESTIVE SYSTEM O.R.      1.1668         3.6         4.8
                                                      PROCEDURES W/O CC.                                            
    172.............       06  MED                   DIGESTIVE MALIGNANCY W CC..      1.3152         5.2         7.1
    173.............       06  MED                   DIGESTIVE MALIGNANCY W/O CC       .7316         2.8         4.0
    174.............       06  MED                   G.I. HEMORRHAGE W CC.......       .9945         4.0         4.9
    175.............       06  MED                   G.I. HEMORRHAGE W/O CC.....       .5305         2.5         3.0
    176.............       06  MED                   COMPLICATED PEPTIC ULCER...      1.1068         4.3         5.5
    177.............       06  MED                   UNCOMPLICATED PEPTIC ULCER        .8646         3.7         4.6
                                                      W CC.                                                         
    178.............       06  MED                   UNCOMPLICATED PEPTIC ULCER        .6344         2.7         3.2
                                                      W/O CC.                                                       
    179.............       06  MED                   INFLAMMATORY BOWEL DISEASE.      1.1084         5.0         6.4
    180.............       06  MED                   G.I. OBSTRUCTION W CC......       .9184         4.2         5.4
    181.............       06  MED                   G.I. OBSTRUCTION W/O CC....       .5254         2.9         3.5
    182.............       06  MED                   ESOPHAGITIS, GASTROENT &          .7709         3.4         4.4
                                                      MISC DIGEST DISORDERS AGE                                     
                                                      >17 W CC.                                                     
    183.............       06  MED                   ESOPHAGITIS, GASTROENT &          .5594         2.4         3.0
                                                      MISC DIGEST DISORDERS AGE                                     
                                                      >17 W/O CC.                                                   
    184.............       06  MED                   ESOPHAGITIS, GASTROENT &          .5224         2.5         3.2
                                                      MISC DIGEST DISORDERS AGE                                     
                                                      0-17.                                                         
    185.............       03  MED                   DENTAL & ORAL DIS EXCEPT          .8303         3.3         4.5
                                                      EXTRACTIONS &                                                 
                                                      RESTORATIONS, AGE >17.                                        
    186.............       03  MED                   *DENTAL & ORAL DIS EXCEPT         .3207         2.9         2.9
                                                      EXTRACTIONS &                                                 
                                                      RESTORATIONS, AGE 0-17.                                       
    187.............       03  MED                   DENTAL EXTRACTIONS &              .7415         3.0         4.0
                                                      RESTORATIONS.                                                 
    188.............       06  MED                   OTHER DIGESTIVE SYSTEM           1.0758         4.1         5.6
                                                      DIAGNOSES AGE >17 W CC.                                       
    189.............       06  MED                   OTHER DIGESTIVE SYSTEM            .5600         2.4         3.2
                                                      DIAGNOSES AGE >17 W/O CC.                                     
    190.............       06  MED                   OTHER DIGESTIVE SYSTEM            .7636         3.8         5.3
                                                      DIAGNOSES AGE 0-17.                                           
    191.............       07  SURG                  PANCREAS, LIVER & SHUNT          4.4088        10.8        14.6
                                                      PROCEDURES W CC.                                              
    192.............       07  SURG                  PANCREAS, LIVER & SHUNT          1.7111         5.4         6.7
                                                      PROCEDURES W/O CC.                                            
    
    [[Page 25651]]
    
                                                                                                                    
    193.............       07  SURG                  BILIARY TRACT PROC EXCEPT        3.3324        10.4        12.5
                                                      ONLY CHOLECYST W OR W/O                                       
                                                      C.D.E. W CC.                                                  
    194.............       07  SURG                  BILIARY TRACT PROC EXCEPT        1.6689         5.8         6.9
                                                      ONLY CHOLECYST W OR W/O                                       
                                                      C.D.E. W/O CC.                                                
    195.............       07  SURG                  CHOLECYSTECTOMY W C.D.E. W       2.7947         8.3         9.8
                                                      CC.                                                           
    196.............       07  SURG                  CHOLECYSTECTOMY W C.D.E. W/      1.6378         4.9         5.7
                                                      O CC.                                                         
    197.............       07  SURG                  CHOLECYSTECTOMY EXCEPT BY        2.3864         7.1         8.6
                                                      LAPAROSCOPE W/O C.D.E. W                                      
                                                      CC.                                                           
    198.............       07  SURG                  CHOLECYSTECTOMY EXCEPT BY        1.2024         4.0         4.6
                                                      LAPAROSCOPE W/O C.D.E. W/O                                    
                                                      CC.                                                           
    199.............       07  SURG                  HEPATOBILIARY DIAGNOSTIC         2.3873         7.7        10.2
                                                      PROCEDURE FOR MALIGNANCY.                                     
    200.............       07  SURG                  HEPATOBILIARY DIAGNOSTIC         3.2791         7.4        11.5
                                                      PROCEDURE FOR NON-                                            
                                                      MALIGNANCY.                                                   
    201.............       07  SURG                  OTHER HEPATOBILIARY OR           3.5903        10.4        14.4
                                                      PANCREAS O.R. PROCEDURES.                                     
    202.............       07  MED                   CIRRHOSIS & ALCOHOLIC            1.3123         5.1         6.8
                                                      HEPATITIS.                                                    
    203.............       07  MED                   MALIGNANCY OF HEPATOBILIARY      1.2979         5.1         6.9
                                                      SYSTEM OR PANCREAS.                                           
    204.............       07  MED                   DISORDERS OF PANCREAS            1.2114         4.7         6.1
                                                      EXCEPT MALIGNANCY.                                            
    205.............       07  MED                   DISORDERS OF LIVER EXCEPT        1.2109         4.9         6.6
                                                      MALIG, CIRR, ALC HEPA W CC.                                   
    206.............       07  MED                   DISORDERS OF LIVER EXCEPT         .6932         3.1         4.1
                                                      MALIG, CIRR, ALC HEPA W/O                                     
                                                      CC.                                                           
    207.............       07  MED                   DISORDERS OF THE BILIARY         1.0711         4.0         5.2
                                                      TRACT W CC.                                                   
    208.............       07  MED                   DISORDERS OF THE BILIARY          .6178         2.3         2.9
                                                      TRACT W/O CC.                                                 
    209.............       08  SURG                  MAJOR JOINT & LIMB               2.1818         4.9         5.5
                                                      REATTACHMENT PROCEDURES OF                                    
                                                      LOWER EXTREMITY.                                              
    210.............       08  SURG                  HIP & FEMUR PROCEDURES           1.8153         6.1         7.1
                                                      EXCEPT MAJOR JOINT AGE >17                                    
                                                      W CC.                                                         
    211.............       08  SURG                  HIP & FEMUR PROCEDURES           1.2530         4.7         5.2
                                                      EXCEPT MAJOR JOINT AGE >17                                    
                                                      W/O CC.                                                       
    212.............       08  SURG                  HIP & FEMUR PROCEDURES            .8679         3.2         3.8
                                                      EXCEPT MAJOR JOINT AGE 0-                                     
                                                      17.                                                           
    213.............       08  SURG                  AMPUTATION FOR                   1.6323         6.2         8.4
                                                      MUSCULOSKELETAL SYSTEM &                                      
                                                      CONN TISSUE DISORDERS.                                        
    214.............       08  SURG                  NO LONGER VALID............       .0000          .0          .0
    215.............       08  SURG                  NO LONGER VALID............       .0000          .0          .0
    216.............       08  SURG                  BIOPSIES OF MUSCULOSKELETAL      2.1241         7.0         9.8
                                                      SYSTEM & CONNECTIVE TISSUE.                                   
    217.............       08  SURG                  WND DEBRID & SKN GRFT            2.7825         8.7        13.0
                                                      EXCEPT HAND,FOR MUSCSKELET                                    
                                                      & CONN TISS DIS.                                              
    218.............       08  SURG                  LOWER EXTREM & HUMER PROC        1.4630         4.2         5.3
                                                      EXCEPT HIP, FOOT, FEMUR                                       
                                                      AGE >17 W CC.                                                 
    219.............       08  SURG                  LOWER EXTREM & HUMER PROC         .9926         2.8         3.3
                                                      EXCEPT HIP, FOOT, FEMUR                                       
                                                      AGE >17 W/O CC.                                               
    220.............       08  SURG                  *LOWER EXTREM & HUMER PROC        .5827         5.3         5.3
                                                      EXCEPT HIP, FOOT, FEMUR                                       
                                                      AGE 0-17.                                                     
    221.............       08  SURG                  NO LONGER VALID............       .0000          .0          .0
    222.............       08  SURG                  NO LONGER VALID............       .0000          .0          .0
    223.............       08  SURG                  MAJOR SHOULDER/ELBOW PROC,        .9257         2.0         2.6
                                                      OR OTHER UPPER EXTREMITY                                      
                                                      PROC W CC.                                                    
    224.............       08  SURG                  SHOULDER, ELBOW OR FOREARM        .7876         1.7         2.1
                                                      PROC, EXC MAJOR JOINT                                         
                                                      PROC, W/O CC.                                                 
    225.............       08  SURG                  FOOT PROCEDURES............      1.0120         3.0         4.4
    226.............       08  SURG                  SOFT TISSUE PROCEDURES W CC      1.4076         4.0         5.9
    227.............       08  SURG                  SOFT TISSUE PROCEDURES W/O        .7916         2.1         2.7
                                                      CC.                                                           
    228.............       08  SURG                  MAJOR THUMB OR JOINT PROC,       1.0048         2.3         3.4
                                                      OR OTH HAND OR WRIST PROC                                     
                                                      W CC.                                                         
    229.............       08  SURG                  HAND OR WRIST PROC, EXCEPT        .7055         1.8         2.4
                                                      MAJOR JOINT PROC, W/O CC.                                     
    230.............       08  SURG                  LOCAL EXCISION & REMOVAL OF      1.1097         3.1         4.5
                                                      INT FIX DEVICES OF HIP &                                      
                                                      FEMUR.                                                        
    231.............       08  SURG                  LOCAL EXCISION & REMOVAL OF      1.2922         3.0         4.6
                                                      INT FIX DEVICES EXCEPT HIP                                    
                                                      & FEMUR.                                                      
    232.............       08  SURG                  ARTHROSCOPY................      1.0895         2.3         3.8
    233.............       08  SURG                  OTHER MUSCULOSKELET SYS &        2.0599         5.4         7.7
                                                      CONN TISS O.R. PROC W CC.                                     
    234.............       08  SURG                  OTHER MUSCULOSKELET SYS &        1.1712         2.8         3.6
                                                      CONN TISS O.R. PROC W/O CC.                                   
    235.............       08  MED                   FRACTURES OF FEMUR.........       .7526         3.9         5.4
    236.............       08  MED                   FRACTURES OF HIP & PELVIS..       .7260         4.1         5.3
    237.............       08  MED                   SPRAINS, STRAINS, &               .5367         2.9         3.6
                                                      DISLOCATIONS OF HIP,                                          
                                                      PELVIS & THIGH.                                               
    238.............       08  MED                   OSTEOMYELITIS..............      1.3382         6.7         8.9
    239.............       08  MED                   PATHOLOGICAL FRACTURES &          .9661         5.0         6.4
                                                      MUSCULOSKELETAL & CONN                                        
                                                      TISS MALIGNANCY.                                              
    240.............       08  MED                   CONNECTIVE TISSUE DISORDERS      1.2253         5.0         6.7
                                                      W CC.                                                         
    241.............       08  MED                   CONNECTIVE TISSUE DISORDERS       .5875         3.1         4.0
                                                      W/O CC.                                                       
    242.............       08  MED                   SEPTIC ARTHRITIS...........      1.0391         5.2         6.8
    243.............       08  MED                   MEDICAL BACK PROBLEMS......       .7159         3.8         4.9
    244.............       08  MED                   BONE DISEASES & SPECIFIC          .7056         3.9         5.0
                                                      ARTHROPATHIES W CC.                                           
    
    [[Page 25652]]
    
                                                                                                                    
    245.............       08  MED                   BONE DISEASES & SPECIFIC          .4961         2.9         3.8
                                                      ARTHROPATHIES W/O CC.                                         
    246.............       08  MED                   NON-SPECIFIC ARTHROPATHIES.       .5662         3.1         3.9
    247.............       08  MED                   SIGNS & SYMPTOMS OF               .5542         2.6         3.5
                                                      MUSCULOSKELETAL SYSTEM &                                      
                                                      CONN TISSUE.                                                  
    248.............       08  MED                   TENDONITIS, MYOSITIS &            .7487         3.6         4.7
                                                      BURSITIS.                                                     
    249.............       08  MED                   AFTERCARE, MUSCULOSKELETAL        .6514         2.6         3.6
                                                      SYSTEM & CONNECTIVE TISSUE.                                   
    250.............       08  MED                   FX, SPRN, STRN & DISL OF          .6776         3.2         4.2
                                                      FOREARM, HAND, FOOT AGE                                       
                                                      >17 W CC.                                                     
    251.............       08  MED                   FX, SPRN, STRN & DISL OF          .4622         2.3         3.0
                                                      FOREARM, HAND, FOOT AGE                                       
                                                      >17 W/O CC.                                                   
    252.............       08  MED                   *FX, SPRN, STRN & DISL OF         .2532         1.8         1.8
                                                      FOREARM, HAND, FOOT AGE 0-                                    
                                                      17.                                                           
    253.............       08  MED                   FX, SPRN, STRN & DISL OF          .7188         3.7         4.9
                                                      UPARM, LOWLEG EX FOOT AGE                                     
                                                      >17 W CC.                                                     
    254.............       08  MED                   FX, SPRN, STRN & DISL OF          .4315         2.7         3.4
                                                      UPARM, LOWLEG EX FOOT AGE                                     
                                                      >17 W/O CC.                                                   
    255.............       08  MED                   *FX, SPRN, STRN & DISL OF         .2947         2.9         2.9
                                                      UPARM, LOWLEG EX FOOT AGE                                     
                                                      0-17.                                                         
    256.............       08  MED                   OTHER MUSCULOSKELETAL             .7564         3.8         5.1
                                                      SYSTEM & CONNECTIVE TISSUE                                    
                                                      DIAGNOSES.                                                    
    257.............       09  SURG                  TOTAL MASTECTOMY FOR              .9219         2.4         3.0
                                                      MALIGNANCY W CC.                                              
    258.............       09  SURG                  TOTAL MASTECTOMY FOR              .7237         1.9         2.1
                                                      MALIGNANCY W/O CC.                                            
    259.............       09  SURG                  SUBTOTAL MASTECTOMY FOR           .8840         2.0         3.1
                                                      MALIGNANCY W CC.                                              
    260.............       09  SURG                  SUBTOTAL MASTECTOMY FOR           .6238         1.4         1.5
                                                      MALIGNANCY W/O CC.                                            
    261.............       09  SURG                  BREAST PROC FOR NON-              .9138         1.7         2.2
                                                      MALIGNANCY EXCEPT BIOPSY &                                    
                                                      LOCAL EXCISION.                                               
    262.............       09  SURG                  BREAST BIOPSY & LOCAL             .8738         2.9         4.2
                                                      EXCISION FOR NON-                                             
                                                      MALIGNANCY.                                                   
    263.............       09  SURG                  SKIN GRAFT &/OR DEBRID FOR       2.0055         8.8        11.9
                                                      SKN ULCER OR CELLULITIS W                                     
                                                      CC.                                                           
    264.............       09  SURG                  SKIN GRAFT &/OR DEBRID FOR       1.1061         5.4         7.2
                                                      SKN ULCER OR CELLULITIS W/                                    
                                                      O CC.                                                         
    265.............       09  SURG                  SKIN GRAFT &/OR DEBRID           1.4806         4.2         6.5
                                                      EXCEPT FOR SKIN ULCER OR                                      
                                                      CELLULITIS W CC.                                              
    266.............       09  SURG                  SKIN GRAFT &/OR DEBRID            .8252         2.5         3.4
                                                      EXCEPT FOR SKIN ULCER OR                                      
                                                      CELLULITIS W/O CC.                                            
    267.............       09  SURG                  PERIANAL & PILONIDAL              .9378         3.0         4.6
                                                      PROCEDURES.                                                   
    268.............       09  SURG                  SKIN, SUBCUTANEOUS TISSUE &      1.0673         2.3         3.6
                                                      BREAST PLASTIC PROCEDURES.                                    
    269.............       09  SURG                  OTHER SKIN, SUBCUT TISS &        1.5778         5.6         7.9
                                                      BREAST PROC W CC.                                             
    270.............       09  SURG                  OTHER SKIN, SUBCUT TISS &         .7218         2.2         3.2
                                                      BREAST PROC W/O CC.                                           
    271.............       09  MED                   SKIN ULCERS................      1.0023         5.7         7.2
    272.............       09  MED                   MAJOR SKIN DISORDERS W CC..      1.0465         4.9         6.4
    273.............       09  MED                   MAJOR SKIN DISORDERS W/O CC       .6251         3.6         4.8
    274.............       09  MED                   MALIGNANT BREAST DISORDERS       1.1170         4.8         6.8
                                                      W CC.                                                         
    275.............       09  MED                   MALIGNANT BREAST DISORDERS        .5288         2.6         3.6
                                                      W/O CC.                                                       
    276.............       09  MED                   NON-MALIGANT BREAST               .6416         3.6         4.5
                                                      DISORDERS.                                                    
    277.............       09  MED                   CELLULITIS AGE >17 W CC....       .8345         4.8         5.9
    278.............       09  MED                   CELLULITIS AGE >17 W/O CC..       .5561         3.8         4.5
    279.............       09  MED                   CELLULITIS AGE 0-17........       .6697         4.3         5.0
    280.............       09  MED                   TRAUMA TO THE SKIN, SUBCUT        .6624         3.3         4.3
                                                      TISS & BREAST AGE >17 W CC.                                   
    281.............       09  MED                   TRAUMA TO THE SKIN, SUBCUT        .4540         2.5         3.2
                                                      TISS & BREAST AGE >17 W/O                                     
                                                      CC.                                                           
    282.............       09  MED                   *TRAUMA TO THE SKIN, SUBCUT       .2563         2.2         2.2
                                                      TISS & BREAST AGE 0-17.                                       
    283.............       09  MED                   MINOR SKIN DISORDERS W CC..       .6961         3.6         4.8
    284.............       09  MED                   MINOR SKIN DISORDERS W/O CC       .4419         2.6         3.3
    285.............       10  SURG                  AMPUTAT OF LOWER LIMB FOR        2.0445         8.1        11.0
                                                      ENDOCRINE, NUTRIT, &                                          
                                                      METABOL DISORDERS.                                            
    286.............       10  SURG                  ADRENAL & PITUITARY              2.2173         5.5         7.0
                                                      PROCEDURES.                                                   
    287.............       10  SURG                  SKIN GRAFTS & WOUND DEBRID       1.8652         8.0        11.3
                                                      FOR ENDOC, NUTRIT & METAB                                     
                                                      DISORDERS.                                                    
    288.............       10  SURG                  O.R. PROCEDURES FOR OBESITY      2.0156         4.7         5.9
    289.............       10  SURG                  PARATHYROID PROCEDURES.....      1.0132         2.2         3.2
    290.............       10  SURG                  THYROID PROCEDURES.........       .9181         1.9         2.5
    291.............       10  SURG                  THYROGLOSSAL PROCEDURES....       .5752         1.5         1.8
    292.............       10  SURG                  OTHER ENDOCRINE, NUTRIT &        2.5779         7.5        10.7
                                                      METAB O.R. PROC W CC.                                         
    293.............       10  SURG                  OTHER ENDOCRINE, NUTRIT &        1.2954         3.9         5.5
                                                      METAB O.R. PROC W/O CC.                                       
    294.............       10  MED                   DIABETES AGE >35...........       .7500         3.8         4.9
    295.............       10  MED                   DIABETES AGE 0-35..........       .7234         3.0         4.0
    296.............       10  MED                   NUTRITIONAL & MISC                .8511         4.1         5.4
                                                      METABOLIC DISORDERS AGE                                       
                                                      >17 W CC.                                                     
    297.............       10  MED                   NUTRITIONAL & MISC                .5206         2.9         3.7
                                                      METABOLIC DISORDERS AGE                                       
                                                      >17 W/O CC.                                                   
    298.............       10  MED                   NUTRITIONAL & MISC                .5479         2.4         3.7
                                                      METABOLIC DISORDERS AGE 0-                                    
                                                      17.                                                           
    299.............       10  MED                   INBORN ERRORS OF METABOLISM       .8774         3.9         5.4
    300.............       10  MED                   ENDOCRINE DISORDERS W CC...      1.0807         4.8         6.3
    301.............       10  MED                   ENDOCRINE DISORDERS W/O CC.       .6023         2.9         3.8
    302.............       11  SURG                  KIDNEY TRANSPLANT..........      3.6251         8.6        10.1
    
    [[Page 25653]]
    
                                                                                                                    
    303.............       11  SURG                  KIDNEY, URETER & MAJOR           2.6598         7.5         9.2
                                                      BLADDER PROCEDURES FOR                                        
                                                      NEOPLASM.                                                     
    304.............       11  SURG                  KIDNEY, URETER & MAJOR           2.3331         6.5         9.0
                                                      BLADDER PROC FOR NON-NEOPL                                    
                                                      W CC.                                                         
    305.............       11  SURG                  KIDNEY, URETER & MAJOR           1.1358         3.2         3.9
                                                      BLADDER PROC FOR NON-NEOPL                                    
                                                      W/O CC.                                                       
    306.............       11  SURG                  PROSTATECTOMY W CC.........      1.2407         3.8         5.5
    307.............       11  SURG                  PROSTATECTOMY W/O CC.......       .6423         2.0         2.4
    308.............       11  SURG                  MINOR BLADDER PROCEDURES W       1.5218         4.1         6.0
                                                      CC.                                                           
    309.............       11  SURG                  MINOR BLADDER PROCEDURES W/       .9101         2.1         2.6
                                                      O CC.                                                         
    310.............       11  SURG                  TRANSURETHRAL PROCEDURES W       1.0630         3.0         4.3
                                                      CC.                                                           
    311.............       11  SURG                  TRANSURETHRAL PROCEDURES W/       .6087         1.6         2.0
                                                      O CC.                                                         
    312.............       11  SURG                  URETHRAL PROCEDURES, AGE          .9880         2.9         4.3
                                                      >17 W CC.                                                     
    313.............       11  SURG                  URETHRAL PROCEDURES, AGE          .6269         1.8         2.4
                                                      >17 W/O CC.                                                   
    314.............       11  SURG                  *URETHRAL PROCEDURES, AGE 0-      .4939         2.3         2.3
                                                      17.                                                           
    315.............       11  SURG                  OTHER KIDNEY & URINARY           2.0691         4.6         8.0
                                                      TRACT O.R. PROCEDURES.                                        
    316.............       11  MED                   RENAL FAILURE..............      1.3318         5.0         6.9
    317.............       11  MED                   ADMIT FOR RENAL DIALYSIS...       .6194         2.0         2.9
    318.............       11  MED                   KIDNEY & URINARY TRACT           1.0973         4.4         6.1
                                                      NEOPLASMS W CC.                                               
    319.............       11  MED                   KIDNEY & URINARY TRACT            .6170         2.2         3.0
                                                      NEOPLASMS W/O CC.                                             
    320.............       11  MED                   KIDNEY & URINARY TRACT            .8675         4.5         5.6
                                                      INFECTIONS AGE >17 W CC.                                      
    321.............       11  MED                   KIDNEY & URINARY TRACT            .5826         3.4         4.0
                                                      INFECTIONS AGE >17 W/O CC.                                    
    322.............       11  MED                   KIDNEY & URINARY TRACT            .5394         3.3         4.1
                                                      INFECTIONS AGE 0-17.                                          
    323.............       11  MED                   URINARY STONES W CC, &/OR         .7679         2.4         3.2
                                                      ESW LITHOTRIPSY.                                              
    324.............       11  MED                   URINARY STONES W/O CC......       .4360         1.6         1.9
    325.............       11  MED                   KIDNEY & URINARY TRACT            .6246         3.0         4.0
                                                      SIGNS & SYMPTOMS AGE >17 W                                    
                                                      CC.                                                           
    326.............       11  MED                   KIDNEY & URINARY TRACT            .4152         2.1         2.7
                                                      SIGNS & SYMPTOMS AGE >17 W/                                   
                                                      O CC.                                                         
    327.............       11  MED                   *KIDNEY & URINARY TRACT           .3532         3.1         3.1
                                                      SIGNS & SYMPTOMS AGE 0-17.                                    
    328.............       11  MED                   URETHRAL STRICTURE AGE >17        .7189         2.8         3.7
                                                      W CC.                                                         
    329.............       11  MED                   URETHRAL STRICTURE AGE >17        .4911         1.7         2.3
                                                      W/O CC.                                                       
    330.............       11  MED                   *URETHRAL STRICTURE AGE 0-        .3182         1.6         1.6
                                                      17.                                                           
    331.............       11  MED                   OTHER KIDNEY & URINARY            .9946         4.2         5.6
                                                      TRACT DIAGNOSES AGE >17 W                                     
                                                      CC.                                                           
    332.............       11  MED                   OTHER KIDNEY & URINARY            .6236         2.7         3.6
                                                      TRACT DIAGNOSES AGE >17 W/                                    
                                                      O CC.                                                         
    333.............       11  MED                   OTHER KIDNEY & URINARY            .7891         3.5         5.0
                                                      TRACT DIAGNOSES AGE 0-17.                                     
    334.............       12  SURG                  MAJOR MALE PELVIC                1.5998         4.4         5.0
                                                      PROCEDURES W CC.                                              
    335.............       12  SURG                  MAJOR MALE PELVIC                1.2055         3.4         3.7
                                                      PROCEDURES W/O CC.                                            
    336.............       12  SURG                  TRANSURETHRAL PROSTATECTOMY       .8873         2.8         3.6
                                                      W CC.                                                         
    337.............       12  SURG                  TRANSURETHRAL PROSTATECTOMY       .6186         2.0         2.3
                                                      W/O CC.                                                       
    338.............       12  SURG                  TESTES PROCEDURES, FOR           1.0888         3.2         4.8
                                                      MALIGNANCY.                                                   
    339.............       12  SURG                  TESTES PROCEDURES, NON-           .9811         2.9         4.2
                                                      MALIGNANCY AGE >17.                                           
    340.............       12  SURG                  *TESTES PROCEDURES, NON-          .2828         2.4         2.4
                                                      MALIGNANCY AGE 0-17.                                          
    341.............       12  SURG                  PENIS PROCEDURES...........      1.1213         2.1         3.0
    342.............       12  SURG                  CIRCUMCISION AGE >17.......       .8601         2.6         3.5
    343.............       12  SURG                  *CIRCUMCISION AGE 0-17.....       .1536         1.7         1.7
    344.............       12  SURG                  OTHER MALE REPRODUCTIVE          1.0395         1.8         2.6
                                                      SYSTEM O.R. PROCEDURES FOR                                    
                                                      MALIGNANCY.                                                   
    345.............       12  SURG                  OTHER MALE REPRODUCTIVE           .8659         2.5         3.6
                                                      SYSTEM O.R. PROC EXCEPT                                       
                                                      FOR MALIGNANCY.                                               
    346.............       12  MED                   MALIGNANCY, MALE                  .9541         4.3         5.8
                                                      REPRODUCTIVE SYSTEM, W CC.                                    
    347.............       12  MED                   MALIGNANCY, MALE                  .5764         2.3         3.1
                                                      REPRODUCTIVE SYSTEM, W/O                                      
                                                      CC.                                                           
    348.............       12  MED                   BENIGN PROSTATIC                  .6894         3.2         4.3
                                                      HYPERTROPHY W CC.                                             
    349.............       12  MED                   BENIGN PROSTATIC                  .4142         2.1         2.8
                                                      HYPERTROPHY W/O CC.                                           
    350.............       12  MED                   INFLAMMATION OF THE MALE          .6931         3.6         4.4
                                                      REPRODUCTIVE SYSTEM.                                          
    351.............       12  MED                   *STERILIZATION, MALE.......       .2358         1.3         1.3
    352.............       12  MED                   OTHER MALE REPRODUCTIVE           .6279         2.7         3.6
                                                      SYSTEM DIAGNOSES.                                             
    353.............       13  SURG                  PELVIC EVISCERATION,             1.9243         5.6         6.9
                                                      RADICAL HYSTERECTOMY &                                        
                                                      RADICAL VULVECTOMY.                                           
    354.............       13  SURG                  UTERINE, ADNEXA PROC FOR         1.4969         4.8         5.8
                                                      NON-OVARIAN/ADNEXAL MALIG                                     
                                                      W CC.                                                         
    355.............       13  SURG                  UTERINE, ADNEXA PROC FOR          .9332         3.2         3.5
                                                      NON-OVARIAN/ADNEXAL MALIG                                     
                                                      W/O CC.                                                       
    356.............       13  SURG                  FEMALE REPRODUCTIVE SYSTEM        .7878         2.3         2.6
                                                      RECONSTRUCTIVE PROCEDURES.                                    
    357.............       13  SURG                  UTERINE & ADNEXA PROC FOR        2.4468         7.3         9.0
                                                      OVARIAN OR ADNEXAL                                            
                                                      MALIGNANCY.                                                   
    358.............       13  SURG                  UTERINE & ADNEXA PROC FOR        1.2133         3.7         4.4
                                                      NON-MALIGNANCY W CC.                                          
    359.............       13  SURG                  UTERINE & ADNEXA PROC FOR         .8676         2.8         3.0
                                                      NON-MALIGNANCY W/O CC.                                        
    360.............       13  SURG                  VAGINA, CERVIX & VULVA            .8910         2.6         3.2
                                                      PROCEDURES.                                                   
    361.............       13  SURG                  LAPAROSCOPY & INCISIONAL         1.2140         2.3         3.3
                                                      TUBAL INTERRUPTION.                                           
    362.............       13  SURG                  *ENDOSCOPIC TUBAL                 .3014         1.4         1.4
                                                      INTERRUPTION.                                                 
    
    [[Page 25654]]
    
                                                                                                                    
    363.............       13  SURG                  D&C, CONIZATION & RADIO-          .7481         2.5         3.3
                                                      IMPLANT, FOR MALIGNANCY.                                      
    364.............       13  SURG                  D&C, CONIZATION EXCEPT FOR        .7290         2.6         3.6
                                                      MALIGNANCY.                                                   
    365.............       13  SURG                  OTHER FEMALE REPRODUCTIVE        1.7398         4.6         6.9
                                                      SYSTEM O.R. PROCEDURES.                                       
    366.............       13  MED                   MALIGNANCY, FEMALE               1.1946         4.8         6.9
                                                      REPRODUCTIVE SYSTEM W CC.                                     
    367.............       13  MED                   MALIGNANCY, FEMALE                .5666         2.2         2.9
                                                      REPRODUCTIVE SYSTEM W/O CC.                                   
    368.............       13  MED                   INFECTIONS, FEMALE               1.0553         5.0         6.4
                                                      REPRODUCTIVE SYSTEM.                                          
    369.............       13  MED                   MENSTRUAL & OTHER FEMALE          .5264         2.3         3.1
                                                      REPRODUCTIVE SYSTEM                                           
                                                      DISORDERS.                                                    
    370.............       14  SURG                  CESAREAN SECTION W CC......      1.0533         4.3         5.5
    371.............       14  SURG                  CESAREAN SECTION W/O CC....       .7197         3.2         3.5
    372.............       14  MED                   VAGINAL DELIVERY W                .5679         2.4         3.2
                                                      COMPLICATING DIAGNOSES.                                       
    373.............       14  MED                   VAGINAL DELIVERY W/O              .3987         1.8         2.1
                                                      COMPLICATING DIAGNOSES.                                       
    374.............       14  SURG                  VAGINAL DELIVERY W                .7188         2.1         3.0
                                                      STERILIZATION &/OR D&C.                                       
    375.............       14  SURG                  *VAGINAL DELIVERY W O.R.          .6840         4.4         4.4
                                                      PROC EXCEPT STERIL &/OR                                       
                                                      D&C.                                                          
    376.............       14  MED                   POSTPARTUM & POST ABORTION        .4925         2.4         2.9
                                                      DIAGNOSES W/O O.R.                                            
                                                      PROCEDURE.                                                    
    377.............       14  SURG                  POSTPARTUM & POST ABORTION       1.4598         3.4         4.5
                                                      DIAGNOSES W O.R. PROCEDURE.                                   
    378.............       14  MED                   ECTOPIC PREGNANCY..........       .8441         2.2         2.6
    379.............       14  MED                   THREATENED ABORTION........       .4401         2.2         3.6
    380.............       14  MED                   ABORTION W/O D&C...........       .4235         1.7         2.0
    381.............       14  SURG                  ABORTION W D&C, ASPIRATION        .5583         1.6         2.1
                                                      CURETTAGE OR HYSTEROTOMY.                                     
    382.............       14  MED                   FALSE LABOR................       .1917         1.1         1.3
    383.............       14  MED                   OTHER ANTEPARTUM DIAGNOSES        .4732         2.7         3.7
                                                      W MEDICAL COMPLICATIONS.                                      
    384.............       14  MED                   OTHER ANTEPARTUM DIAGNOSES        .3576         1.9         2.7
                                                      W/O MEDICAL COMPLICATIONS.                                    
    385.............       15  ....................  *NEONATES, DIED OR               1.3728         1.8         1.8
                                                      TRANSFERRED TO ANOTHER                                        
                                                      ACUTE CARE FACILITY.                                          
    386.............       15  ....................  *EXTREME IMMATURITY OR           4.5269        17.9        17.9
                                                      RESPIRATORY DISTRESS                                          
                                                      SYNDROME, NEONATE.                                            
    387.............       15  ....................  *PREMATURITY W MAJOR             3.0918        13.3        13.3
                                                      PROBLEMS.                                                     
    388.............       15  ....................  *PREMATURITY W/O MAJOR           1.8655         8.6         8.6
                                                      PROBLEMS.                                                     
    389.............       15  ....................  *FULL TERM NEONATE W MAJOR       1.4930         4.7         4.7
                                                      PROBLEMS.                                                     
    390.............       15  ....................  NEONATE W OTHER SIGNIFICANT      1.6281         4.2         6.0
                                                      PROBLEMS.                                                     
    391.............       15  ....................  *NORMAL NEWBORN............       .1522         3.1         3.1
    392.............       16  SURG                  SPLENECTOMY AGE >17........      3.2630         7.8        10.4
    393.............       16  SURG                  *SPLENECTOMY AGE 0-17......      1.3447         9.1         9.1
    394.............       16  SURG                  OTHER O.R. PROCEDURES OF         1.6349         4.1         7.1
                                                      THE BLOOD AND BLOOD                                           
                                                      FORMING ORGANS.                                               
    395.............       16  MED                   RED BLOOD CELL DISORDERS          .8209         3.4         4.7
                                                      AGE >17.                                                      
    396.............       16  MED                   RED BLOOD CELL DISORDERS         2.2655         5.5        18.5
                                                      AGE 0-17.                                                     
    397.............       16  MED                   COAGULATION DISORDERS......      1.2544         4.0         5.5
    398.............       16  MED                   RETICULOENDOTHELIAL &            1.2457         4.7         6.0
                                                      IMMUNITY DISORDERS W CC.                                      
    399.............       16  MED                   RETICULOENDOTHELIAL &             .6933         3.0         3.7
                                                      IMMUNITY DISORDERS W/O CC.                                    
    400.............       17  SURG                  LYMPHOMA & LEUKEMIA W MAJOR      2.6552         6.1         9.4
                                                      O.R. PROCEDURE.                                               
    401.............       17  SURG                  LYMPHOMA & NON-ACUTE             2.5729         7.7        11.0
                                                      LEUKEMIA W OTHER O.R. PROC                                    
                                                      W CC.                                                         
    402.............       17  SURG                  LYMPHOMA & NON-ACUTE             1.0126         2.7         3.9
                                                      LEUKEMIA W OTHER O.R. PROC                                    
                                                      W/O CC.                                                       
    403.............       17  MED                   LYMPHOMA & NON-ACUTE             1.6817         5.8         8.2
                                                      LEUKEMIA W CC.                                                
    404.............       17  MED                   LYMPHOMA & NON-ACUTE              .8288         3.2         4.5
                                                      LEUKEMIA W/O CC.                                              
    405.............       17  ....................  *ACUTE LEUKEMIA W/O MAJOR        1.9065         4.9         4.9
                                                      O.R. PROCEDURE AGE 0-17.                                      
    406.............       17  SURG                  MYELOPROLIF DISORD OR            2.5701         6.9         9.5
                                                      POORLY DIFF NEOPL W MAJ                                       
                                                      O.R.PROC W CC.                                                
    407.............       17  SURG                  MYELOPROLIF DISORD OR            1.1786         3.4         4.3
                                                      POORLY DIFF NEOPL W MAJ                                       
                                                      O.R.PROC W/O CC.                                              
    408.............       17  SURG                  MYELOPROLIF DISORD OR            1.8039         4.6         7.5
                                                      POORLY DIFF NEOPL W OTHER                                     
                                                      O.R.PROC.                                                     
    409.............       17  MED                   RADIOTHERAPY...............      1.0112         4.3         5.8
    410.............       17  MED                   CHEMOTHERAPY W/O ACUTE            .8403         2.7         3.4
                                                      LEUKEMIA AS SECONDARY                                         
                                                      DIAGNOSIS.                                                    
    411.............       17  MED                   HISTORY OF MALIGNANCY W/O         .3229         2.0         2.9
                                                      ENDOSCOPY.                                                    
    412.............       17  MED                   HISTORY OF MALIGNANCY W           .5222         1.9         2.3
                                                      ENDOSCOPY.                                                    
    413.............       17  MED                   OTHER MYELOPROLIF DIS OR         1.3511         5.4         7.5
                                                      POORLY DIFF NEOPL DIAG W                                      
                                                      CC.                                                           
    414.............       17  MED                   OTHER MYELOPROLIF DIS OR          .7210         3.1         4.2
                                                      POORLY DIFF NEOPL DIAG W/O                                    
                                                      CC.                                                           
    415.............       18  SURG                  O.R. PROCEDURE FOR               3.5656        10.5        14.4
                                                      INFECTIOUS & PARASITIC                                        
                                                      DISEASES.                                                     
    416.............       18  MED                   SEPTICEMIA AGE >17.........      1.4885         5.7         7.4
    417.............       18  MED                   SEPTICEMIA AGE 0-17........      1.3566         4.5         6.0
    418.............       18  MED                   POSTOPERATIVE & POST-             .9882         4.9         6.2
                                                      TRAUMATIC INFECTIONS.                                         
    419.............       18  MED                   FEVER OF UNKNOWN ORIGIN AGE       .8779         4.0         5.0
                                                      >17 W CC.                                                     
    420.............       18  MED                   FEVER OF UNKNOWN ORIGIN AGE       .6351         3.2         4.0
                                                      >17 W/O CC.                                                   
    421.............       18  MED                   VIRAL ILLNESS AGE >17......       .6757         3.1         4.0
    
    [[Page 25655]]
    
                                                                                                                    
    422.............       18  MED                   VIRAL ILLNESS & FEVER OF          .5729         2.6         3.3
                                                      UNKNOWN ORIGIN AGE 0-17.                                      
    423.............       18  MED                   OTHER INFECTIOUS &               1.6011         5.8         7.8
                                                      PARASITIC DISEASES                                            
                                                      DIAGNOSES.                                                    
    424.............       19  SURG                  O.R. PROCEDURE W PRINCIPAL       2.3280         9.0        14.3
                                                      DIAGNOSES OF MENTAL                                           
                                                      ILLNESS.                                                      
    425.............       19  MED                   ACUTE ADJUST REACT &              .6791         3.0         4.1
                                                      DISTURBANCES OF                                               
                                                      PSYCHOSOCIAL DYSFUNCTION.                                     
    426.............       19  MED                   DEPRESSIVE NEUROSES........       .5537         3.5         4.9
    427.............       19  MED                   NEUROSES EXCEPT DEPRESSIVE.       .5609         3.4         4.8
    428.............       19  MED                   DISORDERS OF PERSONALITY &        .7031         4.5         7.2
                                                      IMPULSE CONTROL.                                              
    429.............       19  MED                   ORGANIC DISTURBANCES &            .8721         5.2         7.4
                                                      MENTAL RETARDATION.                                           
    430.............       19  MED                   PSYCHOSES..................       .8073         6.2         8.8
    431.............       19  MED                   CHILDHOOD MENTAL DISORDERS.       .7541         4.6         7.3
    432.............       19  MED                   OTHER MENTAL DISORDER             .7008         3.4         5.2
                                                      DIAGNOSES.                                                    
    433.............       20  ....................  ALCOHOL/DRUG ABUSE OR             .3024         2.3         3.2
                                                      DEPENDENCE, LEFT AMA.                                         
    434.............       20  ....................  ALC/DRUG ABUSE OR DEPEND,         .6998         3.9         5.2
                                                      DETOX OR OTH SYMPT TREAT W                                    
                                                      CC.                                                           
    435.............       20  ....................  ALC/DRUG ABUSE OR DEPEND,         .4143         3.5         4.4
                                                      DETOX OR OTH SYMPT TREAT W/                                   
                                                      O CC.                                                         
    436.............       20  ....................  ALC/DRUG DEPENDENCE W             .8189        11.4        14.1
                                                      REHABILITATION THERAPY.                                       
    437.............       20  ....................  ALC/DRUG DEPENDENCE,              .7027         7.7         9.2
                                                      COMBINED REHAB & DETOX                                        
                                                      THERAPY.                                                      
    438.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    439.............       21  SURG                  SKIN GRAFTS FOR INJURIES...      1.5601         5.0         7.7
    440.............       21  SURG                  WOUND DEBRIDEMENTS FOR           1.7978         5.7         8.9
                                                      INJURIES.                                                     
    441.............       21  SURG                  HAND PROCEDURES FOR              1.0114         2.3         3.4
                                                      INJURIES.                                                     
    442.............       21  SURG                  OTHER O.R. PROCEDURES FOR        2.2637         5.2         8.1
                                                      INJURIES W CC.                                                
    443.............       21  SURG                  OTHER O.R. PROCEDURES FOR         .9271         2.5         3.3
                                                      INJURIES W/O CC.                                              
    444.............       21  MED                   TRAUMATIC INJURY AGE >17 W        .7110         3.5         4.5
                                                      CC.                                                           
    445.............       21  MED                   TRAUMATIC INJURY AGE >17 W/       .4790         2.6         3.4
                                                      O CC.                                                         
    446.............       21  MED                   *TRAUMATIC INJURY AGE 0-17.       .2955         2.4         2.4
    447.............       21  MED                   ALLERGIC REACTIONS AGE >17.       .4935         1.9         2.5
    448.............       21  MED                   *ALLERGIC REACTIONS AGE 0-        .0972         2.9         2.9
                                                      17.                                                           
    449.............       21  MED                   POISONING & TOXIC EFFECTS         .7848         2.7         3.8
                                                      OF DRUGS AGE >17 W CC.                                        
    450.............       21  MED                   POISONING & TOXIC EFFECTS         .4333         1.6         2.1
                                                      OF DRUGS AGE >17 W/O CC.                                      
    451.............       21  MED                   *POISONING & TOXIC EFFECTS        .2625         2.1         2.1
                                                      OF DRUGS AGE 0-17.                                            
    452.............       21  MED                   COMPLICATIONS OF TREATMENT        .9785         3.6         5.0
                                                      W CC.                                                         
    453.............       21  MED                   COMPLICATIONS OF TREATMENT        .4855         2.2         2.9
                                                      W/O CC.                                                       
    454.............       21  MED                   OTHER INJURY, POISONING &         .8478         3.2         4.7
                                                      TOXIC EFFECT DIAG W CC.                                       
    455.............       21  MED                   OTHER INJURY, POISONING &         .4694         2.0         2.7
                                                      TOXIC EFFECT DIAG W/O CC.                                     
    456.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    457.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    458.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    459.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    460.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    461.............       23  SURG                  O.R. PROC W DIAGNOSES OF         1.0644         2.4         4.4
                                                      OTHER CONTACT W HEALTH                                        
                                                      SERVICES.                                                     
    462.............       23  MED                   REHABILITATION.............      1.3849        10.1        12.6
    463.............       23  MED                   SIGNS & SYMPTOMS W CC......       .6757         3.3         4.4
    464.............       23  MED                   SIGNS & SYMPTOMS W/O CC....       .5006         2.6         3.4
    465.............       23  MED                   AFTERCARE W HISTORY OF            .5238         1.9         2.9
                                                      MALIGNANCY AS SECONDARY                                       
                                                      DIAGNOSIS.                                                    
    466.............       23  MED                   AFTERCARE W/O HISTORY OF          .6193         2.3         4.1
                                                      MALIGNANCY AS SECONDARY                                       
                                                      DIAGNOSIS.                                                    
    467.............       23  MED                   OTHER FACTORS INFLUENCING         .4944         2.3         4.4
                                                      HEALTH STATUS.                                                
    468.............  .......  ....................  EXTENSIVE O.R. PROCEDURE         3.6566         9.5        13.5
                                                      UNRELATED TO PRINCIPAL                                        
                                                      DIAGNOSIS.                                                    
    469.............  .......  ....................  **PRINCIPAL DIAGNOSIS             .0000          .0          .0
                                                      INVALID AS DISCHARGE                                          
                                                      DIAGNOSIS.                                                    
    470.............  .......  ....................  **UNGROUPABLE..............       .0000          .0          .0
    471.............       08  SURG                  BILATERAL OR MULTIPLE MAJOR      3.3201         5.3         6.1
                                                      JOINT PROCS OF LOWER                                          
                                                      EXTREMITY.                                                    
    472.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    473.............       17  ....................  ACUTE LEUKEMIA W/O MAJOR         3.4688         7.6        13.0
                                                      O.R. PROCEDURE AGE >17.                                       
    474.............  .......  ....................  NO LONGER VALID............       .0000          .0          .0
    475.............       04  MED                   RESPIRATORY SYSTEM               3.7373         8.1        11.3
                                                      DIAGNOSIS WITH VENTILATOR                                     
                                                      SUPPORT.                                                      
    476.............  .......  SURG                  PROSTATIC O.R. PROCEDURE         2.2226         8.9        11.9
                                                      UNRELATED TO PRINCIPAL                                        
                                                      DIAGNOSIS.                                                    
    477.............  .......  SURG                  NON-EXTENSIVE O.R.               1.7581         5.3         8.2
                                                      PROCEDURE UNRELATED TO                                        
                                                      PRINCIPAL DIAGNOSIS.                                          
    478.............       05  SURG                  OTHER VASCULAR PROCEDURES W      2.3334         5.1         7.5
                                                      CC.                                                           
    479.............       05  SURG                  OTHER VASCULAR PROCEDURES W/     1.4224         3.0         3.8
                                                      O CC.                                                         
    480.............  .......  SURG                  LIVER TRANSPLANT...........     10.6455        19.4        26.8
    481.............  .......  SURG                  BONE MARROW TRANSPLANT.....      9.7725        24.5        27.2
    
    [[Page 25656]]
    
                                                                                                                    
    482.............  .......  SURG                  TRACHEOSTOMY FOR FACE,           3.5950        10.0        12.8
                                                      MOUTH & NECK DIAGNOSES.                                       
    483.............  .......  SURG                  TRACHEOSTOMY EXCEPT FOR         16.2677        33.9        42.1
                                                      FACE, MOUTH & NECK                                            
                                                      DIAGNOSES.                                                    
    484.............       24  SURG                  CRANIOTOMY FOR MULTIPLE          5.3170         9.5        14.8
                                                      SIGNIFICANT TRAUMA.                                           
    485.............       24  SURG                  LIMB REATTACHMENT, HIP AND       3.0440         7.7         9.6
                                                      FEMUR PROC FOR MULTIPLE                                       
                                                      SIGNIFICANT TR.                                               
    486.............       24  SURG                  OTHER O.R. PROCEDURES FOR        4.9559         8.4        12.4
                                                      MULTIPLE SIGNIFICANT                                          
                                                      TRAUMA.                                                       
    487.............       24  MED                   OTHER MULTIPLE SIGNIFICANT       1.9036         5.4         7.5
                                                      TRAUMA.                                                       
    488.............       25  SURG                  HIV W EXTENSIVE O.R.             4.5576        11.9        17.2
                                                      PROCEDURE.                                                    
    489.............       25  MED                   HIV W MAJOR RELATED              1.7700         6.2         8.9
                                                      CONDITION.                                                    
    490.............       25  MED                   HIV W OR W/O OTHER RELATED        .9720         3.9         5.4
                                                      CONDITION.                                                    
    491.............       08  SURG                  MAJOR JOINT & LIMB               1.6670         3.1         3.7
                                                      REATTACHMENT PROCEDURES OF                                    
                                                      UPPER EXTREMITY.                                              
    492.............       17  MED                   CHEMOTHERAPY W ACUTE             4.5197        11.4        17.2
                                                      LEUKEMIA AS SECONDARY                                         
                                                      DIAGNOSIS.                                                    
    493.............       07  SURG                  LAPAROSCOPIC                     1.7952         4.2         5.6
                                                      CHOLECYSTECTOMY W/O C.D.E.                                    
                                                      W CC.                                                         
    494.............       07  SURG                  LAPAROSCOPIC                      .9989         1.9         2.4
                                                      CHOLECYSTECTOMY W/O C.D.E.                                    
                                                      W/O CC.                                                       
    495.............  .......  SURG                  LUNG TRANSPLANT............      9.0247        13.7        17.0
    496.............       08  SURG                  COMBINED ANTERIOR/POSTERIOR      5.4507         8.6        10.6
                                                      SPINAL FUSION.                                                
    497.............       08  SURG                  SPINAL FUSION W CC.........      2.7585         5.0         6.3
    498.............       08  SURG                  SPINAL FUSION W/O CC.......      1.6870         2.9         3.5
    499.............       08  SURG                  BACK & NECK PROCS EXCEPT         1.4669         3.8         5.0
                                                      SPINAL FUSION W CC.                                           
    500.............       08  SURG                  BACK & NECK PROCS EXCEPT          .9709         2.4         2.9
                                                      SPINAL FUSION W/O CC.                                         
    501.............       08  SURG                  KNEE PROC W PDX OF               2.5459         8.4        10.4
                                                      INFECTION W CC.                                               
    502.............       08  SURG                  KNEE PROC W PDX OF               1.5548         5.5         6.6
                                                      INFECTION W/O CC.                                             
    503.............       08  SURG                  KNEE PROCEDURES W/O PDX OF       1.2316         3.2         4.2
                                                      INFECTION.                                                    
    504.............       22  SURG                  EXTENSIVE 3RD DEGREE BURN W     13.9440        23.1        31.6
                                                      SKIN GRAFT.                                                   
    505.............       22  ....................  EXTENSIVE 3RD DEGREE BURN W/     1.7871         2.3         5.9
                                                      O SKIN GRAFT.                                                 
    506.............       22  ....................  FULL THICK BURN W SK GRAFT       4.2300        12.2        16.8
                                                      OR INHAL INJ W CC OR SIG                                      
                                                      TR.                                                           
    507.............       22  ....................  FULL THICK BURN W SK GRAFT       1.7017         6.5         9.0
                                                      OR INHAL INJ W/O CC OR SIG                                    
                                                      TR.                                                           
    508.............       22  ....................  FULL THICK BURN W/O SK           1.3792         5.2         7.8
                                                      GRAFT OR INHAL INJ W CC OR                                    
                                                      SIG TR.                                                       
    509.............       22  ....................  FULL THICK BURN W/O SK            .7376         3.3         4.9
                                                      GRAFT OR INHAL INJ W/O CC                                     
                                                      OR SIG TR.                                                    
    510.............       22  ....................  NON-EXTENSIVE BURNS W CC OR      1.1408         4.8         6.9
                                                      SIGNIFICANT TRAUMA.                                           
    511.............       22  ....................  NON-EXTENSIVE BURNS W/O CC        .6001         3.5        4.8 
                                                      OR SIGNIFICANT TRAUMA.                                        
    ----------------------------------------------------------------------------------------------------------------
    * Medicare data have been supplemented by data from 19 states for low volume DRGs.                              
    ** DRGs 469 and 470 contain cases which could not be assigned to valid DRGs.                                    
    Note: Geometric mean is used only to determine payment for transfer cases.                                      
    Note: Arithmetic mean is used only to determine payment for outlier cases.                                      
    Note: Relative weights are based on medicare patient data and may not be appropriate for other patients.        
    
    
                                             Table 6A.--New Diagnosis Codes                                         
    ----------------------------------------------------------------------------------------------------------------
      Diagnosis                                                                                                     
        codes             Description                 CC              MDC                       DRG                 
    ----------------------------------------------------------------------------------------------------------------
    337.3.......  Autonomic dysreflexia.....  N                            1  18,19                                 
    438.53......  Other paralytic syndrome,   N                            1  12                                    
                   bilateral.                                                                                       
    482.40......  Pneumonia due to            Y                            4  79, 80, 81 \1\                        
                   Staphyloccus, unspecified.                              5  121                                   
                                                                          15  387, 389,\2\ 489 \3\                  
                                                                          25                                        
    482.41......  Pneumonia due to            Y                            4  79, 80, 81                            
                   Staphylococcus aureus.                                  5  121 \1\                               
                                                                          15  387, 389 \2\                          
                                                                          25  489 \3\                               
    482.49......  Other Staphylococcus        Y                            4  79, 80, 81                            
                   pneumonia.                                              5  121 \1\                               
                                                                          15  387, 389 \2\                          
                                                                          25  489 \3\                               
    518.83......  Chronic respiratory         Y                            4  87                                    
                   failure.                                                                                         
    518.84......  Acute and chronic           Y                            4  87                                    
                   respiratory.                                           22  506, 507                              
    519.00......  Unspecified tracheostomy    Y                          Pre  482                                   
                   complication.                                           4  101, 102                              
    519.01......  Infection of tracheostomy.  Y                          Pre  482                                   
                                                                           4  101, 102                              
    519.02......  Mechanical complication of  Y                          Pre  482                                   
                   tracheostomy.                                           4  101, 102                              
    519.09......  Other tracheostomy          Y                          Pre  482                                   
                   complication.                                           4  101, 102                              
    
    [[Page 25657]]
    
                                                                                                                    
    536.40......  Unspecified gastrostomy     Y                            6  188, 189, 190                         
                   complication.                                                                                    
    536.41......  Infection of gastrostomy..  Y                            6  188, 189, 190                         
    536.42......  Mechanical complication of  Y                            6  188, 189, 190                         
                   gastrostomy.                                                                                     
    536.49......  Other gastrostomy           Y                            6  188, 189, 190                         
                   complication.                                                                                    
    564.81......  Neurogenic bowel..........  N                            6  182, 183, 184                         
    564.89......  Other functional disorders  N                            6  182, 183, 184                         
                   of intestine.                                                                                    
    569.62......  Mechanical complication of  Y                            6  188, 189, 190                         
                   colostomy and enterostomy.                                                                       
    659.70......  Abnormality in fetal heart  N                           14  370, 371, 372, 373, 374, 375          
                   rate/rhythm, unspecified                                                                         
                   as to episode of care or                                                                         
                   not applicable.                                                                                  
    659.71......  Abnormality in fetal heart  N                           14  370, 371, 372, 373, 374, 375          
                   rate/rhythm, delivered,                                                                          
                   with or without mention                                                                          
                   of antepartum condition.                                                                         
    659.73......  Abnormality in fetal heart  N                           14  383, 384                              
                   rate/rhythm, antepartum                                                                          
                   condition or complication.                                                                       
    763.81......  Abnormality in fetal heart  N                           15  390                                   
                   rate or rhythm before the                                                                        
                   onset of labor.                                                                                  
    763.82......  Abnormality in fetal heart  N                           15  390                                   
                   rate or rhythm during                                                                            
                   labor.                                                                                           
    763.83......  Abnormality in     N                           15  390                                   
                   fetal heart rate or                                                                              
                   rhythm, unspecified as to                                                                        
                   time of onset.                                                                                   
    763.89......  Other specified             N                           15  390                                   
                   complications of labor                                                                           
                   and delivery affecting                                                                           
                   fetus and newborn.                                                                               
    780.71......  Chronic fatigue syndrome..  N                           23  463, 464                              
                                                                          25  490                                   
    780.79......  Other malaise and  N                           23  463, 464                              
                   fatigue.                                               25  490                                   
    786.03......  Apnea.....................  Y                            4  99, 100                               
                                                                          25  490                                   
    786.04......  Cheyne-Stokes respiration.  Y                            4  99, 100                               
                                                                          25  490                                   
    786.05......  Shortness of breath.......  N                            4  99, 100                               
                                                                          25  490                                   
    786.06......  Tachypnea.................  N                            4  99, 100                               
                                                                          25  490                                   
    786.07......  Wheezing..................  N                            4  99, 100                               
                                                                          25  490                                   
    965.61......  Poisoning by propionic      N                           21  449, 450, 451                         
                   acid derivatives.                                                                                
    965.69......  Poisoning by other          N                           21  449, 450, 451                         
                   antirheumatics.                                                                                  
    995.86......  Malignant hyperthermia....  Y                           21  454, 455                              
    996.55......  Mechanical complications    Y                           21  452, 453                              
                   due to artificial skin                                                                           
                   graft and decellularized                                                                         
                   allodermis.                                                                                      
    996.56......  Mechanical complications    Y                           21  452, 453                              
                   due to peritoneal                                                                                
                   dialysis catheter.                                                                               
    996.68......  Infection and inflammatory  Y                           21  452, 453                              
                   reaction due to                                                                                  
                   peritoneal dialysis                                                                              
                   catheter.                                                                                        
    V02.51......  Carrier or suspected        N                           23  467                                   
                   carrier of Group B                                                                               
                   streptococcus.                                                                                   
    V02.52......  Carrier or suspected        N                           23  467                                   
                   carrier of other                                                                                 
                   streptococcus.                                                                                   
    V02.59......  Carrier or suspected        N                           23  467                                   
                   carrier of other                                                                                 
                   specified bacterial                                                                              
                   diseases.                                                                                        
    V10.48......  Personal history of         N                           17  411, 412                              
                   malignant neoplasm of                                                                            
                   epididymis.                                                                                      
    V13.61......  Personal history of         N                           23  467                                   
                   hypospadias.                                                                                     
    V13.69......  Personal history other      N                           23  467                                   
                   congenital malformation.                                                                         
    V16.51......  Family history of           N                           23  467                                   
                   malignant neoplasm of                                                                            
                   kidney.                                                                                          
    V16.59......  Family history of           N                           23  467                                   
                   malignant neoplasm of                                                                            
                   other urinary organs.                                                                            
    V18.61......  Family history of           N                           23  467                                   
                   polycystic kidney.                                                                               
    V18.69......  Family history of other     N                           23  467                                   
                   kidney diseases.                                                                                 
    V23.81......  Supervision of high-risk    Y                           14  469                                   
                   pregnancy of elderly                                                                             
                   primigravida.                                                                                    
    V23.82......  Supervision of high-risk    Y                           14  469                                   
                   pregnancy of elderly                                                                             
                   multigravida.                                                                                    
    V23.83......  Supervision of high-risk    Y                           14  469                                   
                   pregnancy of young                                                                               
                   primigravida.                                                                                    
    V23.84......  Supervision of high-risk    Y                           14  469                                   
                   pregnancy of young                                                                               
                   multigravida.                                                                                    
    V23.89......  Supervision of other high-  Y                           14  469                                   
                   risk pregnancy.                                                                                  
    V26.51......  Tubal ligation status.....  N                           23  467                                   
    V26.52......  Vasectomy status..........  N                           23  467                                   
    V29.3.......  Observation for suspected   N                           23  467                                   
                   genetic or metabolic                                                                             
                   condition.                                                                                       
    V43.83......  Organ or tissue replaced    N                           23  467                                   
                   by artificial skin.                                                                              
    V44.50......  Unspecified cystostomy      N                           23  467                                   
                   status.                                                                                          
    V44.51......  Cutaneous-vesicostomy       N                           23  467                                   
                   status.                                                                                          
    V44.52......  Appendico-vesicostomy       N                           23  467                                   
                   status.                                                                                          
    V44.59......  Other cystostomy status...  N                           23  467                                   
    V56.2.......  Fitting and adjustment of   N                           11  317                                   
                   peritoneal dialysis                                                                              
                   catheter.                                                                                        
    V58.62......  Encounter for aftercare     N                           23  465, 466                              
                   for long-term (current)                                                                          
                   use of antibiotics.                                                                              
    V76.44......  Special screening for       N                           23  467                                   
                   malignant neoplasm of                                                                            
                   prostate.                                                                                        
    V76.45......  Special screening for       N                           23  467                                   
                   malignant neoplasm of                                                                            
                   testis.                                                                                          
    ----------------------------------------------------------------------------------------------------------------
    \1\ Classified as a ``major complication'' in this DRG.                                                         
    \2\ Classified as a ``major problem'' in these DRGs.                                                            
    \3\ HIV major related condition in this DRG.                                                                    
    
    
    [[Page 25658]]
    
    
                                             Table 6B.--New Procedure Codes                                         
    ----------------------------------------------------------------------------------------------------------------
      Procedure                                                                                                     
        code              Description                 OR              MDC                       DRG                 
    ----------------------------------------------------------------------------------------------------------------
    36.31.......  Open chest transmyocardial  Y                            5  108                                   
                   revascularization.                                                                               
    36.32.......  Other transmyocardial       Y                            5  108                                   
                   revascularization.                                                                               
    36.39.......  Other heart                 Y                            5  108                                   
                   revascularization.                                                                               
    37.67.......  Implantation of             Y                            5  110, 111                              
                   cardiomyostimulation                                   21  442, 443                              
                   system.                                                24  486                                   
    75.37.......  Amnioinfusion.............  N                                                                     
    86.67.......  Dermal regenerative graft.  Y                            1  7, 8                                  
                                                                           3  63                                    
                                                                           5  120                                   
                                                                           6  170, 171                              
                                                                           8  217                                   
                                                                           9  263, 264, 265,                        
                                                                          10  266                                   
                                                                          21  287                                   
                                                                          22  439                                   
                                                                          24  458, 472                              
                                                                              504, 506, 507                         
                                                                              486                                   
    92.30.......  Stereotactic radiosurgery,  N \1\                        1  7, 8                                  
                   not otherwise specified.                               10  292, 293                              
                                                                          17  401, 402, 408                         
    92.31.......  Single source photon        N                            1  7, 8                                  
                   radiosurgery.                                          10  292, 293                              
                                                                          17  401, 402, 408                         
    92.32.......  Multi-source photon         N                            1  7, 8                                  
                   radiosurgery.                                          10  292, 293                              
                                                                          17  401, 402, 408                         
    92.33.......  Particulate radiosurgery..  N                            1  7, 8                                  
                                                                          10  292, 293                              
                                                                          17  401, 402, 408                         
    92.39.......  Stereotactic radiosurgery,  N                            1  7, 8                                  
                   not elsewhere classified.                              10  292, 293                              
                                                                          17  401, 402, 408                         
    96.29.......  Reduction of                N                                                                     
                   intussusception of                                                                               
                   alimentary tract.                                                                                
    99.10.......  Injection or infusion of    N                                                                     
                   thrombolytic agent.                                                                              
    99.20.......  Injection or infusion of    N                                                                     
                   platelet inhibitor.                                                                              
    ----------------------------------------------------------------------------------------------------------------
    \1\ Nonoperating room, but affecting DRG                                                                        
    
    
                                            Table 6C.--Invalid Diagnosis Code                                       
    ----------------------------------------------------------------------------------------------------------------
      Diagnosis                                                                                                     
        codes             Description                 CC              MDC                       DRG                 
    ----------------------------------------------------------------------------------------------------------------
    482.4.......  Pneumonia due to            Y                            4  79, 80, 81                            
                   Staphylococcus.                                         5  121 \1\                               
                                                                          15  387, 389 \2\                          
                                                                          25  489 \3\                               
    519.0.......  Tracheostomy complication.  Y                          PRE  482                                   
                                                                           4  101, 102                              
    564.8.......  Other specified functional  N                            6  182, 183, 184                         
                   disorders of intestine.                                                                          
    763.8.......  Other specified             N                           15  390                                   
                   complications of labor                                                                           
                   and delivery affecting                                                                           
                   fetus and newborn.                                                                               
    780.7.......  Malaise and fatigue.......  N                           23  463, 464                              
                                                                          25  490                                   
    965.6.......  Poisoning by                N                           21  449, 450, 451                         
                   antirheumatics                                                                                   
                   [antiphlogistics].                                                                               
    V02.5.......  Carrier or suspected        N                           23  467                                   
                   carrier of other                                                                                 
                   specified bacterial                                                                              
                   diseases.                                                                                        
    V13.6.......  Personal history of         N                           23  467                                   
                   congenital malformations.                                                                        
    V16.5.......  Family history of           N                           23  467                                   
                   malignant neoplasm of                                                                            
                   urinary organs.                                                                                  
    V18.6.......  Family history of kidney    N                           23  467                                   
                   diseases.                                                                                        
    V23.8.......  Supervision of other high-  Y                           14  469                                   
                   risk pregnancy.                                                                                  
    V44.5.......  Cystostomy status.........  N                           23  467                                   
    ----------------------------------------------------------------------------------------------------------------
    \1\ Classified as a ``major complication'' in this DRG.                                                         
    \2\ Classified as a ``major problem'' in these DRGs.                                                            
    \3\ HIV major related condition in this DRG.                                                                    
    
    
    [[Page 25659]]
    
    
                                           Table 6D.--Invalid Procedure Codes                                       
    ----------------------------------------------------------------------------------------------------------------
      Procedure                                                                                                     
        code              Description                 OR              MDC                       DRG                 
    ----------------------------------------------------------------------------------------------------------------
    36.3........  Other heart                 Y                            5  108                                   
                   revascularization.                                                                               
    92.3........  Stereotactic radiosurgery.  N \1\                        1  7, 8                                  
                                                                          10  292, 293                              
                                                                          17  401, 402, 408                         
    ----------------------------------------------------------------------------------------------------------------
    \1\ Nonoperation room but effecting DRG.                                                                        
    
    
                                        Table 6E.--Revised Diagnosis Code Titles                                    
    ----------------------------------------------------------------------------------------------------------------
      Diagnosis                                                                                                     
        code              Description                 CC              MDC                       DRG                 
    ----------------------------------------------------------------------------------------------------------------
    518.81......  Acute respiratory failure.  Y                            4   87                                   
                                                                          22  506, 507                              
    659.60......  Elderly multigravida        N                           14  370, 371, 372, 373, 374, 375          
                   unspecified as to episode                                                                        
                   of care or not applicable.                                                                       
    659.61......  Elderly multigravida        N                           14  370, 371, 372, 373, 374, 375          
                   delivered, with mention                                                                          
                   of antepartum condition.                                                                         
    659.63......  Elderly multigravida with   N                           14  383, 384                              
                   antepartum condition or                                                                          
                   complication.                                                                                    
    V56.1.......  Fitting and adjustment of   N                           11  317                                   
                   extracorporeal dialysis                                                                          
                   catheter.                                                                                        
    V82.4.......  Maternal postnatal          N                           23  467                                   
                   screening of chromosomal                                                                         
                   anomalies.                                                                                       
    ----------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25660]]
    
    
                 Table 6F.--Additions to the CC Exclusions List             
                                Page 1 of 3 Pages                           
       CCs that are added to the list are in Table 6F--Additions to the CC  
        Exclusions List. Each of the principal diagnoses is shown with an   
    asterisk, and the revisions to the CC Exclusions List are provided in an
     indented column immediately following the affected principal diagnosis.
    ------------------------------------------------------------------------
                                                                            
    ------------------------------------------------------------------------
    *01100    *01123    *01146   *01172   *01195   *01281   *11515     48249
      48240     48240     48240    48240    48240    48240    48240  *48230 
      48241     48241     48241    48241    48241    48241    48241    48240
      48249     48249     48249    48249    48249    48249    48249    48241
    *01101    *01124    *01150   *01173   *01196   *01282   *11595     48249
      48240     48240     48240    48240    48240    48240    48240  *48231 
      48241     48241     48241    48241    48241    48241    48241    48240
      48249     48249     48249    48249    48249    48249    48249    48241
    *01102    *01125    *01151   *01174   *01200   *01283   *1221      48249
      48240     48240     48240    48240    48240    48240    48240  *48232 
      48241     48241     48241    48241    48241    48241    48241    48240
      48249     48249     48249    48249    48249    48249    48249    48241
    *01103    *01126    *01152   *01175   *01201   *01284   *1304      48249
      48240     48240     48240    48240    48240    48240    48240  *48239 
      48241     48241     48241    48241    48241    48241    48241    48240
      48249     48249     48249    48249    48249    48249    48249    48241
    *01104    *01130    *01153   *01176   *01202   *01285   *1363      48249
      48240     48240     48240    48240    48240    48240    48240  *48240 
      48241     48241     48241    48241    48241    48241    48241    01100
      48249     48249     48249    48249    48249    48249    48249    01101
    *01105    *01131    *01154   *01180   *01203   *01286   *3373      01102
      48240     48240     48240    48240    48240    48240    3350     01103
      48241     48241     48241    48241    48241    48241    33510    01104
      48249     48249     48249    48249    48249    48249    33511    01105
    *01106    *01132    *01155   *01181   *01204   *01790     33519    01106
      48240     48240     48240    48240    48240    48240    33520    01110
      48241     48241     48241    48241    48241    48241    33521    01111
      48249     48249     48249    48249    48249    48249    33522    01112
    *01110    *01133    *01156   *01182   *01205   *01791     33523    01113
      48240     48240     48240    48240    48240    48240    33524    01114
      48241     48241     48241    48241    48241    48241    33529    01115
      48249     48249     48249    48249    48249    48249    3358     01116
    *01111    *01134    *01160   *01183   *01206   *01792     3359     01120
      48240     48240     48240    48240    48240    48240  *4800      01121
      48241     48241     48241    48241    48241    48241    48240    01122
      48249     48249     48249    48249    48249    48249    48241    01123
    *01112    *01135    *01161   *01184   *01210   *01793     48249    01124
      48240     48240     48240    48240    48240    48240  *4801      01125
      48241     48241     48241    48241    48241    48241    48240    01126
      48249     48249     48249    48249    48249    48249    48241    01130
    *01113    *01136    *01162   *01185   *01211   *01794     48249    01131
      48240     48240     48240    48240    48240    48240  *4802      01132
      48241     48241     48241    48241    48241    48241    48240    01133
      48249     48249     48249    48249    48249    48249    48241    01134
    *01114    *01140    *01163   *01186   *01212   *01795     48249    01135
      48240     48240     48240    48240    48240    48240  *4808      01136
      48241     48241     48241    48241    48241    48241    48240    01140
      48249     48249     48249    48249    48249    48249    48241    01141
    *01115    *01141    *01164   *01190   *01213   *01796     48249    01142
      48240     48240     48240    48240    48240    48240  *4809      01143
      48241     48241     48241    48241    48241    48241    48240    01144
      48249     48249     48249    48249    48249    48249    48241    01145
    *01116    *01142    *01165   *01191   *01214   *0212      48249    01146
      48240     48240     48240    48240    48240    48240  *481       01150
      48241     48241     48241    48241    48241    48241    48240    01151
      48249     48249     48249    48249    48249    48249    48241    01152
    *01120    *01143    *01166   *01192   *01215   *0310      48249    01153
      48240     48240     48240    48240    48240    48240  *4820      01154
      48241     48241     48241    48241    48241    48241    48240    01155
      48249     48249     48249    48249    48249    48249    48241    01156
    *01121    *01144    *01170   *01193   *01216   *0391      48249    01160
      48240     48240     48240    48240    48240    48240  *4821      01161
      48241     48241     48241    48241    48241    48241    48240    01162
      48249     48249     48249    48249    48249    48249    48241    01163
    *01122    *01145    *01171   *01194   *01280   *11505     48249    01164
      48240     48240     48240    48240    48240    48240  *4822      01165
      48241     48241     48241    48241    48241    48241    48240    01166
      48249     48249     48249    48249    48249    48249    48241    01170
    ------------------------------------------------------------------------
    
    
    [[Page 25661]]
    
    
                                Page 2 of 3 Pages                           
    ------------------------------------------------------------------------
                                                                            
    ------------------------------------------------------------------------
      01171     4955      01183    5078     01195    48240    48241    48249
      01172     4956      01184    5080     01196    48241    48249  *5061  
      01173     4957      01185    5081     01200    48249  *4950      48240
      01174     4958      01186    5171     01201  *48283     48240    48241
      01175     4959      01190  *48249     01202    48240    48241    48249
      01176     5060      01191    01100    01203    48241    48249  *5062  
      01180     5061      01192    01101    01204    48249  *4951      48240
      01181     5070      01193    01102    01205  *48284     48240    48241
      01182     5071      01194    01103    01206    48240    48241    48249
      01183     5078      01195    01104    01210    48241    48249  *5063  
      01184     5080      01196    01105    01211    48249  *4952      48240
      01185     5081      01200    01106    01212  *48289     48240    48241
      01186     5171      01201    01110    01213    48240    48241    48249
      01190   *48241      01202    01111    01214    48241    48249  *5064  
      01191     01100     01203    01112    01215    48249  *4953      48240
      01192     01101     01204    01113    01216  *4829      48240    48241
      01193     01102     01205    01114    0310     48240    48241    48249
      01194     01103     01206    01115    11505    48241    48249  *5069  
      01195     01104     01210    01116    11515    48249  *4954      48240
      01196     01105     01211    01120    1304   *4830      48240    48241
      01200     01106     01212    01121    1363     48240    48241    48249
      01201     01110     01213    01122    481      48241    48249  *5070  
      01202     01111     01214    01123    4820     48249  *4955      48240
      01203     01112     01215    01124    4821   *4831      48240    48241
      01204     01113     01216    01125    4822     48240    48241    48249
      01205     01114     0310     01126    48230    48241    48249  *5071  
      01206     01115     11505    01130    48231    48249  *4956      48240
      01210     01116     11515    01131    48232  *4838      48240    48241
      01211     01120     1304     01132    48239    48240    48241    48249
      01212     01121     1363     01133    48240    48241    48249  *5078  
      01213     01122     481      01134    48241    48249  *4957      48240
      01214     01123     4820     01135    48249  *4841      48240    48241
      01215     01124     4821     01136    48281    48240    48241    48249
      01216     01125     4822     01140    48282    48241    48249  *5080  
      0310      01126     48230    01141    48283    48249  *4958      48240
      11505     01130     48231    01142    48284  *4843      48240    48241
      11515     01131     48232    01143    48289    48240    48241    48249
      1304      01132     48239    01144    4829     48241    48249  *5081  
      1363      01133     48240    01145    4830     48249  *4959      48240
      481       01134     48241    01146    4831   *4845      48240    48241
      4820      01135     48249    01150    4838     48240    48241    48249
      4821      01136     48281    01151    4841     48241    48249  *5088  
      4822      01140     48282    01152    4843     48249  *496       48240
      48230     01141     48283    01153    4845   *4846      48240    48241
      48231     01142     48284    01154    4846     48240    48241    48249
      48232     01143     48289    01155    4847     48241    48249  *5089  
      48239     01144     4829     01156    4848     48249  *500       48240
      48240     01145     4830     01160    485    *4847      48240    48241
      48241     01146     4831     01161    486      48240    48241    48249
      48249     01150     4838     01162    4870     48241    48249  *5171  
      48281     01151     4841     01163    4950     48249  *501       48240
      48282     01152     4843     01164    4951   *4848      48240    48241
      48283     01153     4845     01165    4952     48240    48241    48249
      48284     01154     4846     01166    4953     48241    48249  *5178  
      48289     01155     4847     01170    4954     48249  *502       48240
      4829      01156     4848     01171    4955   *485       48240    48241
      4830      01160     485      01172    4956     48240    48241    48249
      4831      01161     486      01173    4957     48241    48249  *51881 
      4838      01162     4870     01174    4958     48249  *503       51883
      4841      01163     4950     01175    4959   *486       48240    51884
      4843      01164     4951     01176    5060     48240    48241    78603
      4845      01165     4952     01180    5061     48241    48249    78604
      4846      01166     4953     01181    5070     48249  *504     *51882 
      4847      01170     4954     01182    5071   *4870      48240    51883
      4848      01171     4955     01183    5078     48240    48241    51884
      485       01172     4956     01184    5080     48241    48249    78603
      486       01173     4957     01185    5081     48249  *505       78604
      4870      01174     4958     01186    5171   *4871      48240  *51883 
      4950      01175     4959     01190  *48281     48240    48241    51881
      4951      01176     5060     01191    48240    48241    48249    51882
      4952      01180     5061     01192    48241    48249  *5060      51883
      4953      01181     5070     01193    48249  *494       48240    51884
      4954      01182     5071     01194  *48282     48240    48241    78603
    ------------------------------------------------------------------------
    
    
    [[Page 25662]]
    
    
                                Page 3 of 3 Pages                           
    ------------------------------------------------------------------------
                                                                            
    ------------------------------------------------------------------------
      78604     53642   *99656     56962    V2384    V2384                  
      7991      53649     99655  *99791     V2389    V2389                  
    *51884      56962     99656    53640  *V230      V239                   
      51881     9974      99659    53641    V2381  *V2389                   
      51882   *53642      99660    53642    V2382    V237                   
      51883     53640     99661    53649    V2383    V2381                  
      51884     53641     99662    56962    V2384    V2382                  
      78603     53642     99663    99586    V2389    V2383                  
      78604     53649     99664    99655  *V231      V2384                  
      7991      56962     99665    99656    V2381    V2389                  
    *51889      9974      99666    99668    V2382    V239                   
      48240   *53649      99667  *99799     V2383  *V239                    
      48241     53640     99668    53640    V2384    V2381                  
      48249     53641     99669    53641    V2389    V2382                  
    *51900      53642     99670    53642  *V232      V2383                  
      51900     53649     99671    53649    V2381    V2384                  
      51901     56962     99672    56962    V2382    V2389                  
      51902     9974      99673    99586    V2383                           
      51909   *56960      99674    99655    V2384                           
    *51901      56962     99675    99656    V2389                           
      51900   *56961      99676    99668  *V233                             
      51901     56962     99677  *9980      V2381                           
      51902   *56962      99678    99586    V2382                           
      51909     56960     99679  *99811     V2383                           
    *51902      56961   *99659     99586    V2384                           
      51900     56962     99655  *99812     V2389                           
      51901     56969     99656    99586  *V234                             
      51902   *56969      99668  *99813     V2381                           
      51909     56962   *99660     99586    V2382                           
    *51909    *74861      99655  *99881     V2383                           
      51900     48240     99656    53640    V2384                           
      51901     48241     99668    53641    V2389                           
      51902     48249   *99668     53642  *V235                             
      51909   *78603      99655    53649    V2381                           
    *5191       78603     99656    56962    V2382                           
      51900     78604     99659    99586    V2383                           
      51901   *78604      99660  *99883     V2384                           
      51902     78603     99661    53640    V2389                           
      51909     78604     99662    53641  *V237                             
    *5198     *7991       99663    53642    V2381                           
      48240     51883     99664    53649    V2382                           
      48241     51884     99665    56962    V2383                           
      48249     78603     99666    99586    V2384                           
      51883     78604     99667  *99889     V2389                           
      51884   *9584       99668    53640  *V2381                            
      51900     99586     99669    53641    V237                            
      51901   *9954       99670    53642    V2381                           
      51902     99586     99671    53649    V2382                           
      51909   *99586      99672    56962    V2383                           
      78603     99586     99673    99586    V2384                           
      78604   *99652      99674  *9989      V2389                           
    *5199       99655     99675    53640    V239                            
      48240   *99655      99676    53641  *V2382                            
      48241     99652     99677    53642    V237                            
      48249     99655     99678    53649    V2381                           
      51883     99660     99679    56962    V2382                           
      51884     99661   *99669     99586    V2383                           
      51900     99662     99655  *V220      V2384                           
      51901     99663     99656    V2381    V2389                           
      51902     99665     99668    V2382    V239                            
      51909     99666   *99670     V2383  *V2383                            
      78603     99667     99655    V2384    V237                            
      78604     99669     99656    V2389    V2381                           
    *53640      99670     99668  *V221      V2382                           
      53640     99671   *99679     V2381    V2383                           
      53641     99672     99655    V2382    V2384                           
      53642     99673     99656    V2383    V2389                           
      53649     99674     99668    V2384    V239                            
      56962     99675   *9974      V2389  *V2384                            
      9974      99676     53640  *V222      V237                            
    *53641      99677     53641    V2381    V2381                           
      53640     99678     53642    V2382    V2382                           
      53641     99679     53649    V2383    V2383                           
    ------------------------------------------------------------------------
    
    
    [[Page 25663]]
    
    
                 Table 6G.--Deletions to the CC Exclusions List             
    [CCs that are deleted from the list are in Table 6G--Deletions to the CC
        Exclusions List. Each of the principal diagnoses is shown with an   
    asterisk, and the revisions to the CC Exclusions List are provided in an
    indented column immediately following the affected principal diagnosis.]
    ------------------------------------------------------------------------
                                                                            
    ------------------------------------------------------------------------
    *01100    *01146    *01195   *11515     01143    48282    4824     4824 
      4824      4824      4824     4824     01144    48283  *4870    *5178  
    *01101    *01150    *01196   *11595     01145    48284    4824     4824 
      4824      4824      4824     4824     01146    48289  *4871    *51889 
    *01102    *01151    *01200   *1221      01150    4829     4824     4824 
      4824      4824      4824     4824     01151    4830   *494     *5190  
    *01103    *01152    *01201   *1304      01152    4831     4824     5190 
      4824      4824      4824     4824     01153    4838   *4950    *5191  
    *01104    *01153    *01202   *1363      01154    4841     4824     5190 
      4824      4824      4824     4824     01155    4843   *4951    *5198  
    *01105    *01154    *01203   *4800      01156    4845     4824     4824 
      4824      4824      4824     4824     01160    4846   *4952      5190 
    *01106    *01155    *01204   *4801      01161    4847     4824   *5199  
      4824      4824      4824     4824     01162    4848   *4953      4824 
    *01110    *01156    *01205   *4802      01163    485      4824     5190 
      4824      4824      4824     4824     01164    486    *4954    *74861 
    *01111    *01160    *01206   *4808      01165    4870     4824     4824 
      4824      4824      4824     4824     01166    4950   *4955    *V220  
    *01112    *01161    *01210   *4809      01170    4951     4824     V238 
      4824      4824      4824     4824     01171    4952   *4956    *V221  
    *01113    *01162    *01211   *481       01172    4953     4824     V238 
      4824      4824      4824     4824     01173    4954   *4957    *V222  
    *01114    *01163    *01212   *4820      01174    4955     4824     V238 
      4824      4824      4824     4824     01175    4956   *4958    *V230  
    *01115    *01164    *01213   *4821      01176    4957     4824     V238 
      4824      4824      4824     4824     01180    4958   *4959    *V231  
    *01116    *01165    *01214   *4822      01181    4959     4824     V238 
      4824      4824      4824     4824     01182    5060   *496     *V232  
    *01120    *01166    *01215   *48230     01183    5061     4824     V238 
      4824      4824      4824     4824     01184    5070   *500     *V233  
    *01121    *01170    *01216   *48231     01185    5071     4824     V238 
      4824      4824      4824     4824     01186    5078   *501     *V234  
    *01122    *01171    *01280   *48232     01190    5080     4824     V238 
      4824      4824      4824     4824     01191    5081   *502     *V235  
    *01123    *01172    *01281   *48239     01192    5171     4824     V238 
      4824      4824      4824     4824     01193  *48281   *503     *V237  
    *01124    *01173    *01282   *4824      01194    4824     4824     V238 
      4824      4824      4824     01100    01195  *48282   *504     *V238  
    *01125    *01174    *01283     01101    01196    4824     4824     V237 
      4824      4824      4824     01102    01200  *48283   *505       V238 
    *01126    *01175    *01284     01103    01201    4824     4824     V239 
      4824      4824      4824     01104    01202  *48284   *5060    *V239  
    *01130    *01176    *01285     01105    01203    4824     4824     V238 
      4824      4824      4824     01106    01204  *48289   *5061           
    *01131    *01180    *01286     01110    01205    4824     4824          
      4824      4824      4824     01111    01206  *4829    *5062           
    *01132    *01181    *01790     01112    01210    4824     4824          
      4824      4824      4824     01113    01211  *4830    *5063           
    *01133    *01182    *01791     01114    01212    4824     4824          
      4824      4824      4824     01115    01213  *4831    *5064           
    *01134    *01183    *01792     01116    01214    4824     4824          
      4824      4824      4824     01120    01215  *4838    *5069           
    *01135    *01184    *01793     01121    01216    4824     4824          
      4824      4824      4824     01122    0310   *4841    *5070           
    *01136    *01185    *01794     01123    11505    4824     4824          
      4824      4824      4824     01124    11515  *4843    *5071           
    *01140    *01186    *01795     01125    1304     4824     4824          
      4824      4824      4824     01126    1363   *4845    *5078           
    *01141    *01190    *01796     01130    481      4824     4824          
      4824      4824      4824     01131    4820   *4846    *5080           
    *01142    *01191    *0212      01132    4821     4824     4824          
      4824      4824      4824     01133    4822   *4847    *5081           
    *01143    *01192    *0310      01134    48230    4824     4824          
      4824      4824      4824     01135    48231  *4848    *5088           
    *01144    *01193    *0391      01136    48232    4824     4824          
      4824      4824      4824     01140    48239  *485     *5089           
    *01145    *01194    *11505     01141    4824     4824     4824          
      4824      4824      4824     01142    48281  *486     *5171           
    ------------------------------------------------------------------------
    
    
    [[Page 25664]]
    
    
                                       Table 7A.--Medicare Prospective Payment System; Selected Percentile Lengths of Stay                                  
                                                            [FY97 MEDPAR Update 12/97 Grouper V15.0]                                                        
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Number        Arithmetic         10th            25th            50th            75th            90th     
                       DRG                      discharges       mean LOS       percentile      percentile      percentile      percentile      percentile  
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    1.......................................           36587          9.6084               2               4               7              12              20
    2.......................................            6967         10.0350               3               5               8              13              20
    3.......................................               3          9.3333               7               7               9              12              12
    4.......................................            6322          7.7259               1               3               5               9              17
    5.......................................          101105          3.6387               1               2               2               4               8
    6.......................................             355          3.0225               1               1               2               4               7
    7.......................................           12601         10.0945               2               4               7              12              20
    8.......................................            3030          3.1845               1               1               2               4               7
    9.......................................            1692          6.4923               1               3               5               8              13
    10......................................           19727          6.8631               2               3               5               8              14
    11......................................            2960          4.1365               1               2               3               5               8
    12......................................           38339          6.6619               2               3               5               8              12
    13......................................            6315          5.4716               2               3               4               6               9
    14......................................          372136          6.2938               2               3               5               8              12
    15......................................          145631          3.8599               1               2               3               5               7
    16......................................           13905          5.9283               2               3               4               7              11
    17......................................            3212          3.4315               1               2               3               4               7
    18......................................           27489          5.5809               2               3               4               7              10
    19......................................            7294          3.8174               1               2               3               5               7
    20......................................            6590         10.1862               2               5               8              13              19
    21......................................            1369          6.8152               2               3               5               8              14
    22......................................            2789          4.6587               2               2               4               6               9
    23......................................            6884          4.2594               1               2               3               5               8
    24......................................           57890          5.0641               1               2               4               6              10
    25......................................           22696          3.4294               1               2               3               4               7
    26......................................              34          3.1176               1               1               2               4               6
    27......................................            4153          5.4211               1               1               3               7              12
    28......................................           13896          5.9431               1               2               4               7              12
    29......................................            4266          3.5375               1               1               3               4               7
    31......................................            3075          4.4062               1               2               3               5               8
    32......................................            1343          2.9717               1               1               2               3               6
    34......................................           20072          5.4331               1               3               4               7              11
    35......................................            4264          3.5561               1               2               3               4               7
    36......................................            5393          1.5366               1               1               1               1               2
    37......................................            1685          3.7187               1               1               2               4               8
    38......................................             116          2.5948               1               1               2               3               5
    39......................................            1898          2.0327               1               1               1               2               4
    40......................................            2281          3.1806               1               1               2               4               7
    42......................................            4026          2.0904               1               1               1               2               4
    43......................................             120          3.4250               1               2               3               5               7
    44......................................            1343          5.0551               2               3               4               6               9
    45......................................            2414          3.4731               1               2               3               4               6
    46......................................            3148          4.6436               1               2               4               6               9
    47......................................            1220          3.2975               1               1               3               4               7
    48......................................               2          4.5000               4               4               5               5               5
    49......................................            2277          5.0097               1               2               4               6               9
    50......................................            3004          1.9767               1               1               2               2               3
    51......................................             299          2.8194               1               1               1               3               6
    52......................................              89          2.7528               1               1               2               3               7
    53......................................            2989          3.6554               1               1               2               4               8
    54......................................               2          6.0000               5               5               7               7               7
    55......................................            1686          2.9543               1               1               2               3               6
    56......................................             684          2.8436               1               1               2               3               6
    57......................................             608          3.7237               1               1               3               4               7
    59......................................             120          2.4333               1               1               2               3               5
    60......................................               1          4.0000               4               4               4               4               4
    61......................................             278          4.5144               1               1               2               5              10
    62......................................               4          1.2500               1               1               1               1               2
    63......................................            3676          4.4502               1               2               3               5               9
    64......................................            3408          6.7183               1               2               5               8              14
    65......................................           29086          2.9715               1               2               2               4               5
    66......................................            6812          3.2606               1               2               3               4               6
    67......................................             489          3.7996               1               2               3               4               7
    68......................................           11522          4.1519               1               2               3               5               7
    69......................................            3450          3.3183               1               2               3               4               6
    70......................................              37          2.5405               1               1               2               3               4
    71......................................              99          3.9394               1               2               3               6               7
    72......................................             817          3.7931               1               2               3               5               7
    73......................................            6282          4.4062               1               2               3               6               8
    74......................................               2          2.5000               2               2               3               3               3
    
    [[Page 25665]]
    
                                                                                                                                                            
    75......................................           40757         10.2370               4               5               8              13              20
    76......................................           41668         11.3195               3               5               9              14              21
    77......................................            2040          4.8819               1               2               4               7              10
    78......................................           30845          7.3107               3               5               7               9              12
    79......................................          247000          8.4030               3               4               7              10              15
    80......................................            8299          5.8754               2               3               5               7              10
    81......................................               6         12.6667               2               3               6               8               8
    82......................................           71035          7.1298               2               3               6               9              14
    83......................................            7249          5.5655               2               3               4               7              10
    84......................................            1290          3.3256               1               2               3               4               6
    85......................................           22415          6.6640               2               3               5               8              13
    86......................................            1501          3.8741               1               2               3               5               7
    87......................................           73076          6.3172               1               3               5               8              12
    88......................................          388565          5.4142               2               3               4               7              10
    89......................................          469073          6.2791               2               4               5               8              11
    90......................................           38989          4.4632               2               3               4               6               8
    91......................................              48          3.9375               1               2               3               5               7
    92......................................           14464          6.3794               2               3               5               8              12
    93......................................            1314          4.3653               1               2               4               6               8
    94......................................           13391          6.4833               2               3               5               8              12
    95......................................            1388          3.8739               1               2               3               5               7
    96......................................           61778          4.8513               2               3               4               6               9
    97......................................           25587          3.8266               1               2               3               5               7
    98......................................              28          4.9286               1               2               3               5              13
    99......................................           26442          3.0393               1               1               2               4               6
    100.....................................           10283          2.1219               1               1               2               3               4
    101.....................................           20140          4.4383               1               2               3               5               9
    102.....................................            4520          2.7914               1               1               2               3               5
    103.....................................             490         48.0898               9              14              29              67             115
    104.....................................           29151         12.4470               4               7              10              16              23
    105.....................................           25542          9.6459               4               6               8              11              17
    106.....................................          106585         10.6917               6               7               9              12              17
    107.....................................           68972          7.9520               4               5               7               9              13
    108.....................................            8075         11.7282               4               6               9              14              22
    110.....................................           62245          9.6084               2               5               8              12              18
    111.....................................            5581          5.8094               2               4               6               7               9
    112.....................................          118470          3.9277               1               1               3               5               8
    113.....................................           46689         12.2570               4               6               9              15              24
    114.....................................            8489          8.3873               2               4               7              11              16
    115.....................................           15007          8.7475               2               4               7              11              17
    116.....................................          208927          4.1747               1               2               3               5               8
    117.....................................            3726          3.9847               1               1               2               5               9
    118.....................................            6481          2.9303               1               1               2               3               6
    119.....................................            1629          5.3640               1               1               3               7              13
    120.....................................           37814          8.1649               1               2               5              10              18
    121.....................................          170012          6.6480               2               4               6               8              12
    122.....................................           83182          4.2023               1               2               4               6               7
    123.....................................           43363          4.4029               1               1               2               5              10
    124.....................................          154194          4.4587               1               2               4               6               9
    125.....................................           62627          2.8721               1               1               2               4               6
    126.....................................            5399         12.4253               4               6               9              15              25
    127.....................................          719871          5.5133               2               3               4               7              10
    128.....................................           16049          6.0323               3               4               5               7               9
    129.....................................            4455          2.9495               1               1               1               3               7
    130.....................................           98047          5.9926               2               3               5               7              10
    131.....................................           24574          4.6703               1               3               4               6               8
    132.....................................          174092          3.1532               1               2               3               4               6
    133.....................................            6631          2.4803               1               1               2               3               5
    134.....................................           30358          3.4496               1               2               3               4               6
    135.....................................            8217          4.3269               1               2               3               5               8
    136.....................................            1113          2.9695               1               1               2               4               5
    138.....................................          209079          4.0464               1               2               3               5               8
    139.....................................           67303          2.5774               1               1               2               3               5
    140.....................................          107658          2.9719               1               1               2               4               5
    141.....................................           81733          3.8534               1               2               3               5               7
    142.....................................           36613          2.7911               1               1               2               3               5
    143.....................................          143826          2.2585               1               1               2               3               4
    144.....................................           78710          5.2279               1               2               4               7              10
    145.....................................            6350          2.8698               1               1               2               4               6
    146.....................................           10372         10.2717               5               7               9              12              17
    
    [[Page 25666]]
    
                                                                                                                                                            
    147.....................................            1779          6.7482               4               5               7               8              10
    148.....................................          146892         12.2593               5               7              10              15              22
    149.....................................           14387          6.8504               4               5               6               8              10
    150.....................................           23756         10.8870               4               6               9              13              19
    151.....................................            4149          5.8894               2               3               5               8              10
    152.....................................            4713          8.3393               4               5               7              10              14
    153.....................................            1604          5.6359               3               4               5               7               8
    154.....................................           34348         13.3603               4               7              10              16              25
    155.....................................            4743          4.6884               1               2               4               6               9
    156.....................................               2         18.0000               6               6              30              30              30
    157.....................................            9287          5.3854               1               2               4               7              11
    158.....................................            4110          2.6190               1               1               2               3               5
    159.....................................           18320          4.9678               1               2               4               6               9
    160.....................................            9765          2.6768               1               1               2               3               5
    161.....................................           14601          4.0877               1               2               3               5               9
    162.....................................            7065          2.0350               1               1               1               2               4
    163.....................................               5         11.8000               4               4              11              13              22
    164.....................................            5272          8.5277               4               5               7              10              15
    165.....................................            1639          4.9555               2               3               5               6               8
    166.....................................            3542          5.1256               2               3               4               6               9
    167.....................................            2325          2.8456               1               2               2               4               5
    168.....................................            1700          4.5476               1               2               3               6               9
    169.....................................             843          2.5326               1               1               2               3               5
    170.....................................           12774         11.2370               2               5               8              14              23
    171.....................................            1004          4.8337               1               2               4               6               9
    172.....................................           32993          7.1114               2               3               5               9              14
    173.....................................            2135          3.9611               1               1               3               5               8
    174.....................................          248770          4.9263               2               3               4               6               9
    175.....................................           21672          3.0085               1               2               3               4               5
    176.....................................           18343          5.4925               2               3               4               7              10
    177.....................................           11138          4.5572               2               2               4               6               8
    178.....................................            3486          3.2114               1               2               3               4               6
    179.....................................           12485          6.4200               2               3               5               8              12
    180.....................................           93327          5.4284               2               3               4               7              10
    181.....................................           21330          3.5057               1               2               3               4               6
    182.....................................          234973          4.3571               1               2               3               5               8
    183.....................................           69893          3.0179               1               1               2               4               6
    184.....................................              91          3.1648               1               2               2               4               7
    185.....................................            4046          4.4881               1               2               3               6               9
    187.....................................             870          3.9908               1               2               3               5               8
    188.....................................           75257          5.5524               1               2               4               7              11
    189.....................................            8618          3.2060               1               1               2               4               6
    190.....................................              59          5.2712               1               2               4               7              11
    191.....................................           10625         14.5648               4               7              11              18              29
    192.....................................             831          6.7088               2               4               6               8              12
    193.....................................            7334         12.5020               5               7              10              15              22
    194.....................................             773          6.9288               3               4               6               9              12
    195.....................................            7094          9.8105               4               6               8              12              17
    196.....................................            1260          5.7254               2               4               5               7              10
    197.....................................           25012          8.6285               3               5               7              10              15
    198.....................................            6357          4.5945               2               3               4               6               8
    199.....................................            2037         10.1733               3               5               8              14              20
    200.....................................            1339         11.4593               2               4               8              14              23
    201.....................................            1651         14.2938               4               6              11              18              29
    202.....................................           28649          6.7440               2               3               5               8              13
    203.....................................           29508          6.8400               2               3               5               9              14
    204.....................................           53140          6.0853               2               3               5               7              11
    205.....................................           22927          6.5500               2               3               5               8              13
    206.....................................            1614          4.0694               1               2               3               5               8
    207.....................................           35502          5.1397               1               2               4               6              10
    208.....................................            9472          2.8992               1               1               2               4               6
    209.....................................          362634          5.4336               3               4               5               6               8
    210.....................................          141586          7.0191               3               4               6               8              12
    211.....................................           26005          5.1476               3               4               5               6               8
    212.....................................              13          3.7692               1               2               4               5               6
    213.....................................            7496          8.4066               2               4               6              11              16
    216.....................................            6117          9.8190               2               4               7              12              19
    217.....................................           20587         12.9505               3               5               9              16              27
    218.....................................           23700          5.3217               2               3               4               6              10
    219.....................................           18252          3.2882               1               2               3               4               5
    
    [[Page 25667]]
    
                                                                                                                                                            
    220.....................................               5          3.2000               1               1               3               4               7
    223.....................................           18540          2.6177               1               1               2               3               5
    224.....................................            7682          2.0607               1               1               2               3               4
    225.....................................            5644          4.3556               1               2               3               5               9
    226.....................................            5540          5.9224               1               2               4               7              12
    227.....................................            4597          2.7261               1               1               2               3               5
    228.....................................            2757          3.4345               1               1               2               4               8
    229.....................................            1100          2.3827               1               1               2               3               5
    230.....................................            2386          4.5306               1               2               3               5               9
    231.....................................           10685          4.5647               1               2               3               5               9
    232.....................................             496          3.8327               1               1               2               4               9
    233.....................................            4903          7.6490               2               3               5               9              16
    234.....................................            2258          3.6151               1               2               3               5               7
    235.....................................            5348          5.3113               1               2               4               6              10
    236.....................................           39380          5.1518               1               3               4               6               9
    237.....................................            1593          3.6353               1               2               3               5               7
    238.....................................            7851          8.8615               3               4               7              11              17
    239.....................................           59615          6.4289               2               3               5               8              12
    240.....................................           13635          6.6882               2               3               5               8              13
    241.....................................            2905          3.9983               1               2               3               5               7
    242.....................................            2634          6.7358               2               3               5               8              13
    243.....................................           81633          4.8627               2               3               4               6               9
    244.....................................           12420          4.9928               2               3               4               6               9
    245.....................................            4361          3.7420               1               2               3               5               7
    246.....................................            1273          3.9309               1               2               3               5               7
    247.....................................           12240          3.4938               1               2               3               4               7
    248.....................................            8122          4.6959               1               2               4               6               9
    249.....................................           10840          3.6358               1               1               3               4               7
    250.....................................            3561          4.2263               1               2               3               5               8
    251.....................................            2210          2.9570               1               1               2               4               5
    252.....................................               1          1.0000               1               1               1               1               1
    253.....................................           19384          4.8629               1               3               4               6               9
    254.....................................            9275          3.3439               1               2               3               4               6
    255.....................................               2          3.5000               1               1               6               6               6
    256.....................................            5517          5.1064               1               2               4               6              10
    257.....................................           21137          2.9877               1               2               2               3               5
    258.....................................           16396          2.1344               1               1               2               3               3
    259.....................................            3772          3.0803               1               1               2               3               7
    260.....................................            4464          1.5383               1               1               1               2               2
    261.....................................            1967          2.2466               1               1               2               3               4
    262.....................................             659          4.2231               1               1               3               6               9
    263.....................................           27474         11.3931               3               5               8              14              22
    264.....................................            3318          7.0530               2               3               5               8              14
    265.....................................            4309          6.5331               1               2               4               8              13
    266.....................................            2464          3.4054               1               1               2               4               7
    267.....................................             250          4.6400               1               2               3               5               9
    268.....................................             875          3.5783               1               1               2               4               7
    269.....................................            9415          7.8786               2               3               6              10              16
    270.....................................            2662          3.1480               1               1               2               4               7
    271.....................................           22961          7.1545               3               4               6               9              13
    272.....................................            5940          6.4330               2               3               5               8              12
    273.....................................            1307          4.7980               1               2               4               6               8
    274.....................................            2409          6.7430               1               3               5               8              14
    275.....................................             210          3.5143               1               1               2               4               7
    276.....................................             932          4.4678               1               2               4               6               8
    277.....................................           81663          5.9066               2               3               5               7              10
    278.....................................           24598          4.4950               2               3               4               6               8
    279.....................................              12          5.0000               2               2               4               7               9
    280.....................................           14156          4.3177               1               2               3               5               8
    281.....................................            5945          3.1527               1               1               3               4               6
    282.....................................               2          2.0000               2               2               2               2               2
    283.....................................            5201          4.8029               1               2               4               6               9
    284.....................................            1656          3.3255               1               2               3               4               6
    285.....................................            5534         11.0193               3               5               8              13              21
    286.....................................            2141          6.9650               3               4               5               8              13
    287.....................................            6161         11.2446               3               5               8              13              22
    288.....................................            1478          5.9303               2               3               5               6               9
    289.....................................            5457          3.2448               1               1               2               3               7
    290.....................................            8922          2.5158               1               1               2               3               4
    291.....................................              66          1.7576               1               1               1               2               3
    
    [[Page 25668]]
    
                                                                                                                                                            
    292.....................................            5029         10.7174               2               4               8              14              21
    293.....................................             347          5.5476               1               2               4               7              12
    294.....................................           82039          4.9200               1               2               4               6               9
    295.....................................            3593          3.9585               1               2               3               5               7
    296.....................................          235524          5.3934               2               3               4               7              10
    297.....................................           32715          3.6521               1               2               3               4               7
    298.....................................              91          3.7253               1               1               2               4               8
    299.....................................             968          5.3657               1               2               4               7              10
    300.....................................           16820          6.2855               2               3               5               8              12
    301.....................................            2395          3.8113               1               2               3               5               7
    302.....................................            7784         10.1382               5               6               8              12              18
    303.....................................           19638          9.2247               4               5               7              10              16
    304.....................................           12813          8.9904               2               4               7              11              18
    305.....................................            2552          3.8985               1               2               3               5               7
    306.....................................           10658          5.5019               1               2               3               7              12
    307.....................................            2355          2.3996               1               1               2               3               4
    308.....................................            9167          6.0165               1               2               4               8              13
    309.....................................            3541          2.5945               1               1               2               3               5
    310.....................................           26694          4.2835               1               2               3               5               9
    311.....................................            7805          1.9543               1               1               1               2               4
    312.....................................            1731          4.3437               1               1               3               6               9
    313.....................................             587          2.3799               1               1               2               3               5
    314.....................................               1         10.0000              10              10              10              10              10
    315.....................................           28283          8.0413               1               2               5              10              18
    316.....................................           93071          6.8024               2               3               5               9              14
    317.....................................             787          2.8666               1               1               2               3               6
    318.....................................            6194          6.1022               1               3               5               8              12
    319.....................................             407          2.9902               1               1               2               4               6
    320.....................................          177474          5.5698               2               3               4               7              10
    321.....................................           23679          4.0416               2               2               3               5               7
    322.....................................              82          4.1098               2               2               3               4               7
    323.....................................           16931          3.2166               1               1               2               4               6
    324.....................................            7513          1.9385               1               1               1               2               4
    325.....................................            7409          3.9591               1               2               3               5               8
    326.....................................            2192          2.7199               1               1               2               3               5
    327.....................................               9          2.8889               1               1               2               3               4
    328.....................................             759          3.7167               1               2               3               5               7
    329.....................................              87          2.2644               1               1               1               3               4
    331.....................................           43598          5.5769               1               3               4               7              11
    332.....................................            4517          3.5603               1               1               3               5               7
    333.....................................             306          4.9477               1               2               4               6              11
    334.....................................           18572          4.9690               3               3               4               6               8
    335.....................................           10338          3.7163               2               3               3               4               5
    336.....................................           54082          3.6046               1               2               3               4               7
    337.....................................           31770          2.2858               1               1               2               3               4
    338.....................................            2767          4.7879               1               2               3               6              10
    339.....................................            1987          4.1726               1               1               3               5               9
    340.....................................               2          1.0000               1               1               1               1               1
    341.....................................            4909          2.9589               1               1               2               3               6
    342.....................................            1007          3.4518               1               2               2               4               7
    344.....................................            3882          2.6285               1               1               1               3               5
    345.....................................            1343          3.6389               1               1               2               4               8
    346.....................................            4844          5.8179               1               3               4               7              11
    347.....................................             365          3.1370               1               1               2               4               6
    348.....................................            3181          4.2521               1               2               3               5               8
    349.....................................             632          2.7658               1               1               2               4               5
    350.....................................            6114          4.3999               2               2               4               5               8
    352.....................................             638          3.6160               1               2               3               4               7
    353.....................................            2816          6.9457               3               4               5               8              12
    354.....................................            9926          5.7743               3               3               4               6              10
    355.....................................            5640          3.4624               2               3               3               4               5
    356.....................................           28862          2.6478               1               2               2               3               4
    357.....................................            6330          9.0289               3               5               7              11              17
    358.....................................           27373          4.3708               2               3               3               5               7
    359.....................................           27990          2.9775               2               2               3               3               4
    360.....................................           17843          3.1581               1               2               3               4               5
    361.....................................             540          3.3259               1               1               2               3               7
    363.....................................            3943          3.3109               1               2               2               3               6
    364.....................................            1828          3.5656               1               1               2               5               8
    365.....................................            2298          6.8903               1               2               5               9              14
    
    [[Page 25669]]
    
                                                                                                                                                            
    366.....................................            4368          6.8116               1               3               5               8              14
    367.....................................             506          2.8893               1               1               2               3               6
    368.....................................            2895          6.3530               2               3               5               8              12
    369.....................................            2588          3.0622               1               1               2               4               6
    370.....................................            1154          5.4610               2               3               4               5               9
    371.....................................            1157          3.4754               2               3               3               4               5
    372.....................................             975          3.1549               1               2               2               3               5
    373.....................................            3868          2.1171               1               1               2               2               3
    374.....................................             147          3.0340               1               2               2               3               3
    375.....................................               9          5.1111               2               2               3               9              10
    376.....................................             214          2.9252               1               2               2               3               6
    377.....................................              52          4.4808               1               2               3               6               9
    378.....................................             168          2.5952               1               1               2               3               4
    379.....................................             334          3.5868               1               1               2               3               7
    380.....................................              87          2.0345               1               1               2               2               3
    381.....................................             187          2.1283               1               1               1               2               4
    382.....................................              40          1.2750               1               1               1               1               2
    383.....................................            1460          3.7301               1               2               3               4               8
    384.....................................             123          2.6585               1               1               2               3               6
    385.....................................               1          2.0000               2               2               2               2               2
    389.....................................               9          8.6667               1               3               7              10              15
    390.....................................              13          6.0000               2               2               4               5              17
    392.....................................            2513         10.3828               4               5               7              12              21
    394.....................................            1805          7.0853               1               2               4               8              16
    395.....................................           70948          4.7241               1               2               3               6               9
    396.....................................              15         18.4667               1               2               5              11              15
    397.....................................           18814          5.5200               1               2               4               7              11
    398.....................................           18127          6.0414               2               3               5               7              11
    399.....................................            1322          3.7239               1               2               3               5               7
    400.....................................            7225          9.3664               2               3               6              12              20
    401.....................................            6653         11.0137               2               4               8              14              23
    402.....................................            1464          3.8907               1               1               3               5               9
    403.....................................           38919          8.1409               2               3               6              10              17
    404.....................................            3797          4.4464               1               2               3               6               9
    406.....................................            3308          9.5299               2               4               7              12              20
    407.....................................             634          4.3202               1               2               4               5               8
    408.....................................            2667          7.5047               1               2               5               9              16
    409.....................................            4644          5.8404               2               3               4               6              11
    410.....................................           59252          3.4182               1               2               3               4               6
    411.....................................              18          2.8889               1               1               2               2               6
    412.....................................              24          2.3333               1               1               2               3               4
    413.....................................            7781          7.4429               2               3               6               9              15
    414.....................................             676          4.2219               1               2               3               5               8
    415.....................................           45158         14.3432               4               7              11              18              28
    416.....................................          230365          7.3967               2               4               6               9              14
    417.....................................              41          5.9024               2               2               5               7              11
    418.....................................           21184          6.1906               2               3               5               8              11
    419.....................................           15269          5.0200               2               3               4               6               9
    420.....................................            2680          3.9474               1               2               3               5               7
    421.....................................           12113          3.9569               1               2               3               5               7
    422.....................................              86          3.3372               1               2               2               5               7
    423.....................................           10723          7.7520               2               3               6               9              15
    424.....................................            1621         14.2961               2               5              10              18              29
    425.....................................           15405          4.1352               1               2               3               5               8
    426.....................................            4449          4.9020               1               2               3               6              10
    427.....................................            1633          4.8010               1               2               3               6              10
    428.....................................             940          7.1755               1               2               4               8              14
    429.....................................           32769          7.1661               2               3               5               8              14
    430.....................................           56829          8.7198               2               4               7              11              17
    431.....................................             217          7.3088               1               3               5               9              13
    432.....................................             409          5.2152               1               2               3               6              12
    433.....................................            6811          3.2053               1               1               2               4               7
    434.....................................           21537          5.1804               2               3               4               6               9
    435.....................................           14552          4.4078               1               2               4               5               8
    436.....................................            3322         13.9618               4               7              13              21              28
    437.....................................           12779          9.2061               3               5               8              12              16
    439.....................................            1138          7.7065               1               3               5               9              16
    440.....................................            5155          8.9081               2               3               6              10              19
    441.....................................             570          3.4333               1               1               2               4               7
    442.....................................           16247          8.1177               1               3               6              10              17
    
    [[Page 25670]]
    
                                                                                                                                                            
    443.....................................            3153          3.3321               1               1               2               4               7
    444.....................................            3425          4.5007               1               2               3               5               8
    445.....................................            1243          3.3628               1               2               3               4               6
    446.....................................               1          2.0000               2               2               2               2               2
    447.....................................            4257          2.5130               1               1               2               3               5
    449.....................................           27905          3.7822               1               1               3               5               8
    450.....................................            6171          2.0826               1               1               1               2               4
    451.....................................               9          2.7778               1               1               1               4               5
    452.....................................           22863          5.0341               1               2               4               6              10
    453.....................................            3796          2.9236               1               1               2               4               6
    454.....................................            3855          4.6905               1               2               3               6               9
    455.....................................             758          2.7401               1               1               2               3               5
    456.....................................             194          8.5670               1               1               3               9              21
    457.....................................             128          3.5859               1               1               1               3               9
    458.....................................            1526         15.0308               3               7              12              19              31
    459.....................................             480          8.9771               2               3               6              11              19
    460.....................................            2327          6.0812               1               3               4               7              12
    461.....................................            3047          4.4322               1               1               2               4              11
    462.....................................           10348         12.4504               4               6              10              16              23
    463.....................................           13983          4.4209               1               2               3               5               8
    464.....................................            3556          3.3751               1               2               3               4               6
    465.....................................             210          2.9095               1               1               1               3               5
    466.....................................            1748          4.0955               1               1               2               4               9
    467.....................................            1332          4.3949               1               1               2               4               7
    468.....................................           61704         13.4718               3               6              10              17              27
    471.....................................           12918          6.0694               3               4               5               7              10
    472.....................................             179         27.2179               1               8              19              37              55
    473.....................................            8429         12.7713               2               3               7              18              33
    475.....................................          109339         11.1900               2               5               9              15              22
    476.....................................            5924         11.9158               3               6              10              15              22
    477.....................................           28747          8.1623               1               3               6              11              17
    478.....................................          123286          7.4571               1               3               5               9              15
    479.....................................           18337          3.8430               1               2               3               5               7
    480.....................................             400         26.7550               8              11              20              32              53
    481.....................................             256         27.1133              16              20              24              32              43
    482.....................................            6596         12.7329               4               7              10              15              23
    483.....................................           41763         40.0560              14              21              33              50              73
    484.....................................             391         14.6931               2               6              11              18              27
    485.....................................            3471          9.5906               4               5               7              11              18
    486.....................................            2244         12.3382               1               5              10              16              25
    487.....................................            4210          7.3983               2               3               6               9              14
    488.....................................             865         17.0532               4               7              12              22              35
    489.....................................           14894          8.9049               2               4               6              11              19
    490.....................................            4863          5.4148               1               2               4               7              11
    491.....................................           11011          3.6593               2               2               3               4               6
    492.....................................            2334         17.1418               4               5              12              27              36
    493.....................................           56210          5.6284               1               2               5               7              11
    494.....................................           25155          2.4285               1               1               2               3               5
    495.....................................             125         16.9920               7              10              13              19              31
    496.....................................             895         10.5821               4               6               8              13              20
    497.....................................           21969          6.2886               2               3               5               7              11
    498.....................................           12500          3.5058               1               2               3               5               6
    499.....................................           36205          4.9604               2               2               4               6               9
    500.....................................           36448          2.8726               1               2               2               4               5
    501.....................................            1895         10.4391               4               6               8              12              19
    502.....................................             468          6.5876               3               4               6               8              10
    503.....................................            6317          4.2169               1               2               3               5               8
                                             ----------------                                                                                               
                                                    11244775                                                                                                
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
                                       Table 7B.--Medicare Prospective Payment System; Selected Percentile Lengths of Stay                                  
                                                            [FY97 MEDPAR Update 12/97 Grouper V16.0]                                                        
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                  Number        Arithmetic         10th            25th            50th            75th            90th     
                       DRG                      discharges       mean LOS       percentile      percentile      percentile      percentile      percentile  
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    1.......................................           36587          9.6084               2               4               7              12              20
    2.......................................            6967         10.0350               3               5               8              13              20
    3.......................................               3          9.3333               7               7               9              12              12
    
    [[Page 25671]]
    
                                                                                                                                                            
    4.......................................            6322          7.7259               1               3               5               9              17
    5.......................................          101105          3.6387               1               2               2               4               8
    6.......................................             355          3.0225               1               1               2               4               7
    7.......................................           12601         10.0945               2               4               7              12              20
    8.......................................            3030          3.1845               1               1               2               4               7
    9.......................................            1692          6.4923               1               3               5               8              13
    10......................................           19727          6.8631               2               3               5               8              14
    11......................................            2960          4.1365               1               2               3               5               8
    12......................................           38339          6.6619               2               3               5               8              12
    13......................................            6315          5.4716               2               3               4               6               9
    14......................................          372136          6.2938               2               3               5               8              12
    15......................................          145631          3.8599               1               2               3               5               7
    16......................................           13905          5.9283               2               3               4               7              11
    17......................................            3212          3.4315               1               2               3               4               7
    18......................................           27489          5.5809               2               3               4               7              10
    19......................................            7294          3.8174               1               2               3               5               7
    20......................................            6590         10.1862               2               5               8              13              19
    21......................................            1369          6.8152               2               3               5               8              14
    22......................................            2789          4.6587               2               2               4               6               9
    23......................................            6884          4.2594               1               2               3               5               8
    24......................................           57890          5.0641               1               2               4               6              10
    25......................................           22696          3.4294               1               2               3               4               7
    26......................................              34          3.1176               1               1               2               4               6
    27......................................            4153          5.4211               1               1               3               7              12
    28......................................           13896          5.9431               1               2               4               7              12
    29......................................            4266          3.5375               1               1               3               4               7
    31......................................            3075          4.4062               1               2               3               5               8
    32......................................            1343          2.9717               1               1               2               3               6
    34......................................           20072          5.4331               1               3               4               7              11
    35......................................            4264          3.5561               1               2               3               4               7
    36......................................            5393          1.5366               1               1               1               1               2
    37......................................            1685          3.7187               1               1               2               4               8
    38......................................             116          2.5948               1               1               2               3               5
    39......................................            1898          2.0327               1               1               1               2               4
    40......................................            2281          3.1806               1               1               2               4               7
    42......................................            4026          2.0904               1               1               1               2               4
    43......................................             120          3.4250               1               2               3               5               7
    44......................................            1343          5.0551               2               3               4               6               9
    45......................................            2414          3.4731               1               2               3               4               6
    46......................................            3148          4.6436               1               2               4               6               9
    47......................................            1220          3.2975               1               1               3               4               7
    48......................................               2          4.5000               4               4               5               5               5
    49......................................            2277          5.0097               1               2               4               6               9
    50......................................            3004          1.9767               1               1               2               2               3
    51......................................             299          2.8194               1               1               1               3               6
    52......................................              89          2.7528               1               1               2               3               7
    53......................................            2989          3.6554               1               1               2               4               8
    54......................................               2          6.0000               5               5               7               7               7
    55......................................            1686          2.9543               1               1               2               3               6
    56......................................             684          2.8436               1               1               2               3               6
    57......................................             608          3.7237               1               1               3               4               7
    59......................................             120          2.4333               1               1               2               3               5
    60......................................               1          4.0000               4               4               4               4               4
    61......................................             278          4.5144               1               1               2               5              10
    62......................................               4          1.2500               1               1               1               1               2
    63......................................            3676          4.4502               1               2               3               5               9
    64......................................            3408          6.7183               1               2               5               8              14
    65......................................           29086          2.9715               1               2               2               4               5
    66......................................            6812          3.2606               1               2               3               4               6
    67......................................             489          3.7996               1               2               3               4               7
    68......................................           11522          4.1519               1               2               3               5               7
    69......................................            3450          3.3183               1               2               3               4               6
    70......................................              37          2.5405               1               1               2               3               4
    71......................................              99          3.9394               1               2               3               6               7
    72......................................             817          3.7931               1               2               3               5               7
    73......................................            6282          4.4062               1               2               3               6               8
    74......................................               2          2.5000               2               2               3               3               3
    75......................................           40757         10.2370               4               5               8              13              20
    76......................................           41668         11.3195               3               5               9              14              21
    77......................................            2040          4.8819               1               2               4               7              10
    
    [[Page 25672]]
    
                                                                                                                                                            
    78......................................           30845          7.3107               3               5               7               9              12
    79......................................          247000          8.4030               3               4               7              10              15
    80......................................            8299          5.8754               2               3               5               7              10
    81......................................               6         12.6667               2               3               6               8               8
    82......................................           71035          7.1298               2               3               6               9              14
    83......................................            7249          5.5655               2               3               4               7              10
    84......................................            1290          3.3256               1               2               3               4               6
    85......................................           22415          6.6640               2               3               5               8              13
    86......................................            1501          3.8741               1               2               3               5               7
    87......................................           73076          6.3172               1               3               5               8              12
    88......................................          388565          5.4142               2               3               4               7              10
    89......................................          469073          6.2791               2               4               5               8              11
    90......................................           38989          4.4632               2               3               4               6               8
    91......................................              48          3.9375               1               2               3               5               7
    92......................................           14464          6.3794               2               3               5               8              12
    93......................................            1314          4.3653               1               2               4               6               8
    94......................................           13391          6.4833               2               3               5               8              12
    95......................................            1388          3.8739               1               2               3               5               7
    96......................................           61778          4.8513               2               3               4               6               9
    97......................................           25587          3.8266               1               2               3               5               7
    98......................................              28          4.9286               1               2               3               5              13
    99......................................           26442          3.0393               1               1               2               4               6
    100.....................................           10283          2.1219               1               1               2               3               4
    101.....................................           20140          4.4383               1               2               3               5               9
    102.....................................            4520          2.7914               1               1               2               3               5
    103.....................................             490         48.0898               9              14              29              67             115
    104.....................................           29920         12.5288               4               7              10              16              23
    105.....................................           26799          9.7413               4               6               8              11              17
    106.....................................            4737         10.9261               5               7               9              13              19
    107.....................................          101848         10.6808               6               7               9              12              17
    108.....................................            6049         11.2420               4               6               9              14              21
    109.....................................           68972          7.9520               4               5               7               9              13
    110.....................................           62245          9.6084               2               5               8              12              18
    111.....................................            5581          5.8094               2               4               6               7               9
    112.....................................          118470          3.9277               1               1               3               5               8
    113.....................................           46689         12.2570               4               6               9              15              24
    114.....................................            8489          8.3873               2               4               7              11              16
    115.....................................           15007          8.7475               2               4               7              11              17
    116.....................................          208927          4.1747               1               2               3               5               8
    117.....................................            3726          3.9847               1               1               2               5               9
    118.....................................            6481          2.9303               1               1               2               3               6
    119.....................................            1629          5.3640               1               1               3               7              13
    120.....................................           37814          8.1649               1               2               5              10              18
    121.....................................          170012          6.6480               2               4               6               8              12
    122.....................................           83182          4.2023               1               2               4               6               7
    123.....................................           43363          4.4029               1               1               2               5              10
    124.....................................          154194          4.4587               1               2               4               6               9
    125.....................................           62627          2.8721               1               1               2               4               6
    126.....................................            5399         12.4253               4               6               9              15              25
    127.....................................          719871          5.5133               2               3               4               7              10
    128.....................................           16049          6.0323               3               4               5               7               9
    129.....................................            4455          2.9495               1               1               1               3               7
    130.....................................           98047          5.9926               2               3               5               7              10
    131.....................................           24574          4.6703               1               3               4               6               8
    132.....................................          174092          3.1532               1               2               3               4               6
    133.....................................            6631          2.4803               1               1               2               3               5
    134.....................................           30358          3.4496               1               2               3               4               6
    135.....................................            8217          4.3269               1               2               3               5               8
    136.....................................            1113          2.9695               1               1               2               4               5
    138.....................................          209079          4.0464               1               2               3               5               8
    139.....................................           67303          2.5774               1               1               2               3               5
    140.....................................          107658          2.9719               1               1               2               4               5
    141.....................................           81733          3.8534               1               2               3               5               7
    142.....................................           36613          2.7911               1               1               2               3               5
    143.....................................          143826          2.2585               1               1               2               3               4
    144.....................................           78710          5.2279               1               2               4               7              10
    145.....................................            6350          2.8698               1               1               2               4               6
    146.....................................           10372         10.2717               5               7               9              12              17
    147.....................................            1779          6.7482               4               5               7               8              10
    148.....................................          146892         12.2593               5               7              10              15              22
    
    [[Page 25673]]
    
                                                                                                                                                            
    149.....................................           14387          6.8504               4               5               6               8              10
    150.....................................           23756         10.8870               4               6               9              13              19
    151.....................................            4149          5.8894               2               3               5               8              10
    152.....................................            4713          8.3393               4               5               7              10              14
    153.....................................            1604          5.6359               3               4               5               7               8
    154.....................................           34348         13.3603               4               7              10              16              25
    155.....................................            4743          4.6884               1               2               4               6               9
    156.....................................               2         18.0000               6               6              30              30              30
    157.....................................            9287          5.3854               1               2               4               7              11
    158.....................................            4110          2.6190               1               1               2               3               5
    159.....................................           18320          4.9678               1               2               4               6               9
    160.....................................            9765          2.6768               1               1               2               3               5
    161.....................................           14601          4.0877               1               2               3               5               9
    162.....................................            7065          2.0350               1               1               1               2               4
    163.....................................               5         11.8000               4               4              11              13              22
    164.....................................            5272          8.5277               4               5               7              10              15
    165.....................................            1639          4.9555               2               3               5               6               8
    166.....................................            3542          5.1256               2               3               4               6               9
    167.....................................            2325          2.8456               1               2               2               4               5
    168.....................................            1700          4.5476               1               2               3               6               9
    169.....................................             843          2.5326               1               1               2               3               5
    170.....................................           12774         11.2370               2               5               8              14              23
    171.....................................            1004          4.8337               1               2               4               6               9
    172.....................................           32993          7.1114               2               3               5               9              14
    173.....................................            2135          3.9611               1               1               3               5               8
    174.....................................          248770          4.9263               2               3               4               6               9
    175.....................................           21672          3.0085               1               2               3               4               5
    176.....................................           18343          5.4925               2               3               4               7              10
    177.....................................           11138          4.5572               2               2               4               6               8
    178.....................................            3486          3.2114               1               2               3               4               6
    179.....................................           12485          6.4200               2               3               5               8              12
    180.....................................           93327          5.4284               2               3               4               7              10
    181.....................................           21330          3.5057               1               2               3               4               6
    182.....................................          234973          4.3571               1               2               3               5               8
    183.....................................           69893          3.0179               1               1               2               4               6
    184.....................................              91          3.1648               1               2               2               4               7
    185.....................................            4046          4.4881               1               2               3               6               9
    187.....................................             870          3.9908               1               2               3               5               8
    188.....................................           75257          5.5524               1               2               4               7              11
    189.....................................            8618          3.2060               1               1               2               4               6
    190.....................................              59          5.2712               1               2               4               7              11
    191.....................................           10625         14.5648               4               7              11              18              29
    192.....................................             831          6.7088               2               4               6               8              12
    193.....................................            7334         12.5020               5               7              10              15              22
    194.....................................             773          6.9288               3               4               6               9              12
    195.....................................            7094          9.8105               4               6               8              12              17
    196.....................................            1260          5.7254               2               4               5               7              10
    197.....................................           25012          8.6285               3               5               7              10              15
    198.....................................            6357          4.5945               2               3               4               6               8
    199.....................................            2037         10.1733               3               5               8              14              20
    200.....................................            1339         11.4593               2               4               8              14              23
    201.....................................            1651         14.2938               4               6              11              18              29
    202.....................................           28649          6.7440               2               3               5               8              13
    203.....................................           29508          6.8400               2               3               5               9              14
    204.....................................           53140          6.0853               2               3               5               7              11
    205.....................................           22927          6.5500               2               3               5               8              13
    206.....................................            1614          4.0694               1               2               3               5               8
    207.....................................           35502          5.1397               1               2               4               6              10
    208.....................................            9472          2.8992               1               1               2               4               6
    209.....................................          362634          5.4336               3               4               5               6               8
    210.....................................          141586          7.0191               3               4               6               8              12
    211.....................................           26005          5.1476               3               4               5               6               8
    212.....................................              13          3.7692               1               2               4               5               6
    213.....................................            7496          8.4066               2               4               6              11              16
    216.....................................            6117          9.8190               2               4               7              12              19
    217.....................................           20587         12.9505               3               5               9              16              27
    218.....................................           23700          5.3217               2               3               4               6              10
    219.....................................           18252          3.2882               1               2               3               4               5
    220.....................................               5          3.2000               1               1               3               4               7
    223.....................................           18540          2.6177               1               1               2               3               5
    
    [[Page 25674]]
    
                                                                                                                                                            
    224.....................................            7682          2.0607               1               1               2               3               4
    225.....................................            5644          4.3556               1               2               3               5               9
    226.....................................            5540          5.9224               1               2               4               7              12
    227.....................................            4597          2.7261               1               1               2               3               5
    228.....................................            2757          3.4345               1               1               2               4               8
    229.....................................            1100          2.3827               1               1               2               3               5
    230.....................................            2386          4.5306               1               2               3               5               9
    231.....................................           10685          4.5647               1               2               3               5               9
    232.....................................             496          3.8327               1               1               2               4               9
    233.....................................            4903          7.6490               2               3               5               9              16
    234.....................................            2258          3.6151               1               2               3               5               7
    235.....................................            5348          5.3113               1               2               4               6              10
    236.....................................           39380          5.1518               1               3               4               6               9
    237.....................................            1593          3.6353               1               2               3               5               7
    238.....................................            7851          8.8615               3               4               7              11              17
    239.....................................           59615          6.4289               2               3               5               8              12
    240.....................................           13635          6.6882               2               3               5               8              13
    241.....................................            2905          3.9983               1               2               3               5               7
    242.....................................            2634          6.7358               2               3               5               8              13
    243.....................................           81633          4.8627               2               3               4               6               9
    244.....................................           12420          4.9928               2               3               4               6               9
    245.....................................            4361          3.7420               1               2               3               5               7
    246.....................................            1273          3.9309               1               2               3               5               7
    247.....................................           12240          3.4938               1               2               3               4               7
    248.....................................            8122          4.6959               1               2               4               6               9
    249.....................................           10840          3.6358               1               1               3               4               7
    250.....................................            3561          4.2263               1               2               3               5               8
    251.....................................            2210          2.9570               1               1               2               4               5
    252.....................................               1          1.0000               1               1               1               1               1
    253.....................................           19384          4.8629               1               3               4               6               9
    254.....................................            9275          3.3439               1               2               3               4               6
    255.....................................               2          3.5000               1               1               6               6               6
    256.....................................            5517          5.1064               1               2               4               6              10
    257.....................................           21137          2.9877               1               2               2               3               5
    258.....................................           16396          2.1344               1               1               2               3               3
    259.....................................            3772          3.0803               1               1               2               3               7
    260.....................................            4464          1.5383               1               1               1               2               2
    261.....................................            1967          2.2466               1               1               2               3               4
    262.....................................             659          4.2231               1               1               3               6               9
    263.....................................           27474         11.3931               3               5               8              14              22
    264.....................................            3318          7.0530               2               3               5               8              14
    265.....................................            4309          6.5331               1               2               4               8              13
    266.....................................            2464          3.4054               1               1               2               4               7
    267.....................................             250          4.6400               1               2               3               5               9
    268.....................................             875          3.5783               1               1               2               4               7
    269.....................................            9415          7.8786               2               3               6              10              16
    270.....................................            2662          3.1480               1               1               2               4               7
    271.....................................           22961          7.1545               3               4               6               9              13
    272.....................................            5940          6.4330               2               3               5               8              12
    273.....................................            1307          4.7980               1               2               4               6               8
    274.....................................            2409          6.7430               1               3               5               8              14
    275.....................................             210          3.5143               1               1               2               4               7
    276.....................................             932          4.4678               1               2               4               6               8
    277.....................................           81663          5.9066               2               3               5               7              10
    278.....................................           24598          4.4950               2               3               4               6               8
    279.....................................              12          5.0000               2               2               4               7               9
    280.....................................           14156          4.3177               1               2               3               5               8
    281.....................................            5945          3.1527               1               1               3               4               6
    282.....................................               2          2.0000               2               2               2               2               2
    283.....................................            5201          4.8029               1               2               4               6               9
    284.....................................            1656          3.3255               1               2               3               4               6
    285.....................................            5534         11.0193               3               5               8              13              21
    286.....................................            2141          6.9650               3               4               5               8              13
    287.....................................            6161         11.2446               3               5               8              13              22
    288.....................................            1478          5.9303               2               3               5               6               9
    289.....................................            5457          3.2448               1               1               2               3               7
    290.....................................            8922          2.5158               1               1               2               3               4
    291.....................................              66          1.7576               1               1               1               2               3
    292.....................................            5029         10.7174               2               4               8              14              21
    293.....................................             347          5.5476               1               2               4               7              12
    
    [[Page 25675]]
    
                                                                                                                                                            
    294.....................................           82039          4.9200               1               2               4               6               9
    295.....................................            3593          3.9585               1               2               3               5               7
    296.....................................          235524          5.3934               2               3               4               7              10
    297.....................................           32715          3.6521               1               2               3               4               7
    298.....................................              91          3.7253               1               1               2               4               8
    299.....................................             968          5.3657               1               2               4               7              10
    300.....................................           16820          6.2855               2               3               5               8              12
    301.....................................            2395          3.8113               1               2               3               5               7
    302.....................................            7784         10.1382               5               6               8              12              18
    303.....................................           19638          9.2247               4               5               7              10              16
    304.....................................           12813          8.9904               2               4               7              11              18
    305.....................................            2552          3.8985               1               2               3               5               7
    306.....................................           10658          5.5019               1               2               3               7              12
    307.....................................            2355          2.3996               1               1               2               3               4
    308.....................................            9167          6.0165               1               2               4               8              13
    309.....................................            3541          2.5945               1               1               2               3               5
    310.....................................           26694          4.2835               1               2               3               5               9
    311.....................................            7805          1.9543               1               1               1               2               4
    312.....................................            1731          4.3437               1               1               3               6               9
    313.....................................             587          2.3799               1               1               2               3               5
    314.....................................               1         10.0000              10              10              10              10              10
    315.....................................           28283          8.0413               1               2               5              10              18
    316.....................................           93071          6.8024               2               3               5               9              14
    317.....................................             787          2.8666               1               1               2               3               6
    318.....................................            6194          6.1022               1               3               5               8              12
    319.....................................             407          2.9902               1               1               2               4               6
    320.....................................          177474          5.5698               2               3               4               7              10
    321.....................................           23679          4.0416               2               2               3               5               7
    322.....................................              82          4.1098               2               2               3               4               7
    323.....................................           16931          3.2166               1               1               2               4               6
    324.....................................            7513          1.9385               1               1               1               2               4
    325.....................................            7409          3.9591               1               2               3               5               8
    326.....................................            2192          2.7199               1               1               2               3               5
    327.....................................               9          2.8889               1               1               2               3               4
    328.....................................             759          3.7167               1               2               3               5               7
    329.....................................              87          2.2644               1               1               1               3               4
    331.....................................           43598          5.5769               1               3               4               7              11
    332.....................................            4517          3.5603               1               1               3               5               7
    333.....................................             306          4.9477               1               2               4               6              11
    334.....................................           18572          4.9690               3               3               4               6               8
    335.....................................           10338          3.7163               2               3               3               4               5
    336.....................................           54082          3.6046               1               2               3               4               7
    337.....................................           31770          2.2858               1               1               2               3               4
    338.....................................            2767          4.7879               1               2               3               6              10
    339.....................................            1987          4.1726               1               1               3               5               9
    340.....................................               2          1.0000               1               1               1               1               1
    341.....................................            4909          2.9589               1               1               2               3               6
    342.....................................            1007          3.4518               1               2               2               4               7
    344.....................................            3882          2.6285               1               1               1               3               5
    345.....................................            1343          3.6389               1               1               2               4               8
    346.....................................            4844          5.8179               1               3               4               7              11
    347.....................................             365          3.1370               1               1               2               4               6
    348.....................................            3181          4.2521               1               2               3               5               8
    349.....................................             632          2.7658               1               1               2               4               5
    350.....................................            6114          4.3999               2               2               4               5               8
    352.....................................             638          3.6160               1               2               3               4               7
    353.....................................            2816          6.9457               3               4               5               8              12
    354.....................................            9926          5.7743               3               3               4               6              10
    355.....................................            5640          3.4624               2               3               3               4               5
    356.....................................           28862          2.6478               1               2               2               3               4
    357.....................................            6330          9.0289               3               5               7              11              17
    358.....................................           27373          4.3708               2               3               3               5               7
    359.....................................           27990          2.9775               2               2               3               3               4
    360.....................................           17843          3.1581               1               2               3               4               5
    361.....................................             540          3.3259               1               1               2               3               7
    363.....................................            3943          3.3109               1               2               2               3               6
    364.....................................            1828          3.5656               1               1               2               5               8
    365.....................................            2298          6.8903               1               2               5               9              14
    366.....................................            4368          6.8116               1               3               5               8              14
    367.....................................             506          2.8893               1               1               2               3               6
    
    [[Page 25676]]
    
                                                                                                                                                            
    368.....................................            2895          6.3530               2               3               5               8              12
    369.....................................            2588          3.0622               1               1               2               4               6
    370.....................................            1154          5.4610               2               3               4               5               9
    371.....................................            1157          3.4754               2               3               3               4               5
    372.....................................             975          3.1549               1               2               2               3               5
    373.....................................            3868          2.1171               1               1               2               2               3
    374.....................................             147          3.0340               1               2               2               3               3
    375.....................................               9          5.1111               2               2               3               9              10
    376.....................................             214          2.9252               1               2               2               3               6
    377.....................................              52          4.4808               1               2               3               6               9
    378.....................................             168          2.5952               1               1               2               3               4
    379.....................................             334          3.5868               1               1               2               3               7
    380.....................................              87          2.0345               1               1               2               2               3
    381.....................................             187          2.1283               1               1               1               2               4
    382.....................................              40          1.2750               1               1               1               1               2
    383.....................................            1460          3.7301               1               2               3               4               8
    384.....................................             123          2.6585               1               1               2               3               6
    385.....................................               1          2.0000               2               2               2               2               2
    389.....................................               9          8.6667               1               3               7              10              15
    390.....................................              13          6.0000               2               2               4               5              17
    392.....................................            2513         10.3828               4               5               7              12              21
    394.....................................            1805          7.0853               1               2               4               8              16
    395.....................................           70948          4.7241               1               2               3               6               9
    396.....................................              15         18.4667               1               2               5              11              15
    397.....................................           18814          5.5200               1               2               4               7              11
    398.....................................           18127          6.0414               2               3               5               7              11
    399.....................................            1322          3.7239               1               2               3               5               7
    400.....................................            7225          9.3664               2               3               6              12              20
    401.....................................            6653         11.0137               2               4               8              14              23
    402.....................................            1464          3.8907               1               1               3               5               9
    403.....................................           38919          8.1409               2               3               6              10              17
    404.....................................            3797          4.4464               1               2               3               6               9
    406.....................................            3308          9.5299               2               4               7              12              20
    407.....................................             634          4.3202               1               2               4               5               8
    408.....................................            2667          7.5047               1               2               5               9              16
    409.....................................            4644          5.8404               2               3               4               6              11
    410.....................................           59252          3.4182               1               2               3               4               6
    411.....................................              18          2.8889               1               1               2               2               6
    412.....................................              24          2.3333               1               1               2               3               4
    413.....................................            7781          7.4429               2               3               6               9              15
    414.....................................             676          4.2219               1               2               3               5               8
    415.....................................           45158         14.3432               4               7              11              18              28
    416.....................................          230365          7.3967               2               4               6               9              14
    417.....................................              41          5.9024               2               2               5               7              11
    418.....................................           21184          6.1906               2               3               5               8              11
    419.....................................           15269          5.0200               2               3               4               6               9
    420.....................................            2680          3.9474               1               2               3               5               7
    421.....................................           12113          3.9569               1               2               3               5               7
    422.....................................              86          3.3372               1               2               2               5               7
    423.....................................           10723          7.7520               2               3               6               9              15
    424.....................................            1621         14.2961               2               5              10              18              29
    425.....................................           15405          4.1352               1               2               3               5               8
    426.....................................            4449          4.9020               1               2               3               6              10
    427.....................................            1633          4.8010               1               2               3               6              10
    428.....................................             940          7.1755               1               2               4               8              14
    429.....................................           32769          7.1661               2               3               5               8              14
    430.....................................           56829          8.7198               2               4               7              11              17
    431.....................................             217          7.3088               1               3               5               9              13
    432.....................................             409          5.2152               1               2               3               6              12
    433.....................................            6811          3.2053               1               1               2               4               7
    434.....................................           21537          5.1804               2               3               4               6               9
    435.....................................           14552          4.4078               1               2               4               5               8
    436.....................................            3322         13.9618               4               7              13              21              28
    437.....................................           12779          9.2061               3               5               8              12              16
    439.....................................            1138          7.7065               1               3               5               9              16
    440.....................................            5155          8.9081               2               3               6              10              19
    441.....................................             570          3.4333               1               1               2               4               7
    442.....................................           16247          8.1177               1               3               6              10              17
    443.....................................            3153          3.3321               1               1               2               4               7
    444.....................................            3425          4.5007               1               2               3               5               8
    
    [[Page 25677]]
    
                                                                                                                                                            
    445.....................................            1243          3.3628               1               2               3               4               6
    446.....................................               1          2.0000               2               2               2               2               2
    447.....................................            4257          2.5130               1               1               2               3               5
    449.....................................           27905          3.7822               1               1               3               5               8
    450.....................................            6171          2.0826               1               1               1               2               4
    451.....................................               9          2.7778               1               1               1               4               5
    452.....................................           22863          5.0341               1               2               4               6              10
    453.....................................            3796          2.9236               1               1               2               4               6
    454.....................................            3855          4.6905               1               2               3               6               9
    455.....................................             758          2.7401               1               1               2               3               5
    461.....................................            3047          4.4322               1               1               2               4              11
    462.....................................           10348         12.4504               4               6              10              16              23
    463.....................................           13983          4.4209               1               2               3               5               8
    464.....................................            3556          3.3751               1               2               3               4               6
    465.....................................             210          2.9095               1               1               1               3               5
    466.....................................            1748          4.0955               1               1               2               4               9
    467.....................................            1332          4.3949               1               1               2               4               7
    468.....................................           61704         13.4718               3               6              10              17              27
    471.....................................           12918          6.0694               3               4               5               7              10
    473.....................................            8429         12.7713               2               3               7              18              33
    475.....................................          109339         11.1900               2               5               9              15              22
    476.....................................            5924         11.9158               3               6              10              15              22
    477.....................................           28747          8.1623               1               3               6              11              17
    478.....................................          123286          7.4571               1               3               5               9              15
    479.....................................           18337          3.8430               1               2               3               5               7
    480.....................................             400         26.7550               8              11              20              32              53
    481.....................................             256         27.1133              16              20              24              32              43
    482.....................................            6596         12.7329               4               7              10              15              23
    483.....................................           41763         40.0560              14              21              33              50              73
    484.....................................             391         14.6931               2               6              11              18              27
    485.....................................            3471          9.5906               4               5               7              11              18
    486.....................................            2244         12.3382               1               5              10              16              25
    487.....................................            4210          7.3983               2               3               6               9              14
    488.....................................             865         17.0532               4               7              12              22              35
    489.....................................           14894          8.9049               2               4               6              11              19
    490.....................................            4863          5.4148               1               2               4               7              11
    491.....................................           11011          3.6593               2               2               3               4               6
    492.....................................            2334         17.1418               4               5              12              27              36
    493.....................................           56210          5.6284               1               2               5               7              11
    494.....................................           25155          2.4285               1               1               2               3               5
    495.....................................             125         16.9920               7              10              13              19              31
    496.....................................             895         10.5821               4               6               8              13              20
    497.....................................           21969          6.2886               2               3               5               7              11
    498.....................................           12500          3.5058               1               2               3               5               6
    499.....................................           36205          4.9604               2               2               4               6               9
    500.....................................           36448          2.8726               1               2               2               4               5
    501.....................................            1895         10.4391               4               6               8              12              19
    502.....................................             468          6.5876               3               4               6               8              10
    503.....................................            6317          4.2169               1               2               3               5               8
    504.....................................             157         31.5669               8              14              25              39              57
    505.....................................             171          5.8421               1               1               1               4              11
    506.....................................            1130         16.7522               4               8              13              21              34
    507.....................................             391          8.9668               2               4               7              12              17
    508.....................................            1206          7.7355               2               3               5               9              16
    509.....................................             462          4.8528               1               2               3               6              10
    510.....................................            1006          6.8897               2               3               5               8              13
    511.....................................             311          4.8135               1               2               3               6               9
                                             ----------------                                                                                               
                                                    11244775                                                                                                
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    
    
    [[Page 25678]]
    
    
     Table 8A.--Statewide Average Operating Cost-to-Charge Ratios For Urban 
                 and Rural Hospitals (Case Weighted) March 1998             
    ------------------------------------------------------------------------
                             State                           Urban    Rural 
    ------------------------------------------------------------------------
    ALABAMA...............................................    0.373    0.446
    ALASKA................................................    0.503    0.731
    ARIZONA...............................................    0.375    0.540
    ARKANSAS..............................................    0.515    0.457
    CALIFORNIA............................................    0.363    0.481
    COLORADO..............................................    0.467    0.565
    CONNECTICUT...........................................    0.546    0.532
    DELAWARE..............................................    0.506    0.488
    DISTRICT OF COLUMBIA..................................    0.521  .......
    FLORIDA...............................................    0.384    0.389
    GEORGIA...............................................    0.497    0.497
    HAWAII................................................    0.430    0.559
    IDAHO.................................................    0.564    0.582
    ILLINOIS..............................................    0.445    0.546
    INDIANA...............................................    0.559    0.597
    IOWA..................................................    0.513    0.640
    KANSAS................................................    0.429    0.644
    KENTUCKY..............................................    0.496    0.519
    LOUISIANA.............................................    0.442    0.496
    MAINE.................................................    0.620    0.576
    MARYLAND..............................................    0.765    0.818
    MASSACHUSETTS.........................................    0.540    0.571
    MICHIGAN..............................................    0.467    0.580
    MINNESOTA.............................................    0.532    0.611
    MISSISSIPPI...........................................    0.478    0.499
    MISSOURI..............................................    0.441    0.516
    MONTANA...............................................    0.524    0.569
    NEBRASKA..............................................    0.482    0.639
    NEVADA................................................    0.320    0.584
    NEW HAMPSHIRE.........................................    0.573    0.586
    NEW JERSEY............................................    0.436  .......
    NEW MEXICO............................................    0.466    0.510
    NEW YORK..............................................    0.553    0.633
    NORTH CAROLINA........................................    0.523    0.461
    NORTH DAKOTA..........................................    0.620    0.666
    OHIO..................................................    0.533    0.576
    OKLAHOMA..............................................    0.460    0.529
    OREGON................................................    0.546    0.624
    PENNSYLVANIA..........................................    0.407    0.527
    PUERTO RICO...........................................    0.481    0.569
    RHODE ISLAND..........................................    0.571  .......
    SOUTH CAROLINA........................................    0.472    0.494
    SOUTH DAKOTA..........................................    0.537    0.620
    TENNESSEE.............................................    0.481    0.508
    TEXAS.................................................    0.427    0.536
    UTAH..................................................    0.538    0.635
    VERMONT...............................................    0.615    0.577
    VIRGINIA..............................................    0.476    0.499
    WASHINGTON............................................    0.599    0.662
    WEST VIRGINIA.........................................    0.592    0.573
    WISCONSIN.............................................    0.568    0.641
    WYOMING...............................................    0.495    0.694
    ------------------------------------------------------------------------
    
    
        Table 8B.--Statewide Average Capital Cost-to-Charge Ratios (Case    
                              Weighted) March 1998                          
    ------------------------------------------------------------------------
                                 State                                Ratio 
    ------------------------------------------------------------------------
    ALABAMA........................................................    0.047
    ALASKA.........................................................    0.066
    ARIZONA........................................................    0.043
    ARKANSAS.......................................................    0.054
    CALIFORNIA.....................................................    0.038
    COLORADO.......................................................    0.052
    CONNECTICUT....................................................    0.042
    DELAWARE.......................................................    0.058
    DISTRICT OF COLUMBIA...........................................    0.040
    FLORIDA........................................................    0.046
    GEORGIA........................................................    0.049
    HAWAII.........................................................    0.045
    IDAHO..........................................................    0.054
    ILLINOIS.......................................................    0.042
    INDIANA........................................................    0.059
    IOWA...........................................................    0.054
    KANSAS.........................................................    0.052
    KENTUCKY.......................................................    0.051
    LOUISIANA......................................................    0.067
    MAINE..........................................................    0.040
    MARYLAND.......................................................    0.013
    MASSACHUSETTS..................................................    0.056
    MICHIGAN.......................................................    0.046
    MINNESOTA......................................................    0.056
    MISSISSIPPI....................................................    0.054
    MISSOURI.......................................................    0.049
    MONTANA........................................................    0.052
    NEBRASKA.......................................................    0.057
    NEVADA.........................................................    0.068
    NEW HAMPSHIRE..................................................    0.066
    NEW JERSEY.....................................................    0.039
    NEW MEXICO.....................................................    0.047
    NEW YORK.......................................................    0.053
    NORTH CAROLINA.................................................    0.047
    NORTH DAKOTA...................................................    0.075
    OHIO...........................................................    0.053
    OKLAHOMA.......................................................    0.054
    OREGON.........................................................    0.055
    PENNSYLVANIA...................................................    0.043
    PUERTO RICO....................................................    0.054
    RHODE ISLAND...................................................    0.033
    SOUTH CAROLINA.................................................    0.053
    SOUTH DAKOTA...................................................    0.061
    TENNESSEE......................................................    0.056
    TEXAS..........................................................    0.052
    UTAH...........................................................    0.056
    VERMONT........................................................    0.047
    VIRGINIA.......................................................    0.058
    WASHINGTON.....................................................    0.066
    WEST VIRGINIA..................................................    0.056
    WISCONSIN......................................................    0.052
    WYOMING........................................................    0.056
    ------------------------------------------------------------------------
    
    Appendix A--Regulatory Impact Analysis
    
    I. Introduction
    
        We generally prepare a regulatory flexibility analysis that is 
    consistent with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 
    through 612), unless we certify that a proposed rule would not have 
    a significant economic impact on a substantial number of small 
    entities. For purposes of the RFA, we consider all hospitals to be 
    small entities.
        Also, section 1102(b) of the Social Security Act requires us to 
    prepare a regulatory impact analysis for any proposed rule that may 
    have a significant impact on the operations of a substantial number 
    of small rural hospitals. Such an analysis must conform to the 
    provisions of section 603 of the RFA. With the exception of 
    hospitals located in certain New England counties, for purposes of 
    section 1102(b) of the Act, we define a small rural hospital as a 
    hospital with fewer than 100 beds that is located outside of a 
    Metropolitan Statistical Area (MSA) or New England County 
    Metropolitan Area (NECMA). Section 601(g) of the Social Security 
    Amendments of 1983 (Pub. L. 98-21) designated hospitals in certain 
    New England counties as belonging to the adjacent NECMA. Thus, for 
    purposes of the prospective payment system, we classify these 
    hospitals as urban hospitals.
        It is clear that the changes being proposed in this document 
    would affect both a substantial number of small rural hospitals as 
    well as other classes of hospitals, and the effects on some may be 
    significant. Therefore, the discussion below, in combination with 
    the rest of this proposed rule, constitutes a combined regulatory 
    impact analysis and regulatory flexibility analysis.
        In accordance with the provisions of Executive Order 12866, this 
    proposed rule was reviewed by the Office of Management and Budget.
    
    II. Objectives
    
        The primary objective of the prospective payment system is to 
    create incentives for hospitals to operate efficiently and minimize 
    unnecessary costs while at the same time ensuring that payments are 
    sufficient to adequately compensate hospitals for their legitimate 
    costs. In addition, we share national goals of deficit reduction and 
    restraints on government spending in general.
        We believe the proposed changes would further each of these 
    goals while maintaining the financial viability of the hospital 
    industry and ensuring access to high quality health care for 
    Medicare beneficiaries. We expect that these proposed changes would 
    ensure that the outcomes of this payment system are reasonable and 
    equitable while avoiding or minimizing unintended adverse 
    consequences.
    
    III. Limitations of Our Analysis
    
        As has been the case in previously published regulatory impact 
    analyses, the following quantitative analysis presents the projected 
    effects of our proposed policy changes, as well as statutory changes 
    effective for FY 1999, on various hospital groups. We estimate the 
    effects of individual policy changes by estimating payments per case 
    while holding all other payment policies constant. We use the best 
    data available, but we do not attempt to predict behavioral 
    responses to our policy changes, and we do not make adjustments for 
    future changes in such variables as admissions, lengths of stay, or 
    case mix. As we have done in previous proposed rules, we are 
    soliciting comments and information about the anticipated effects of 
    these changes on hospitals and our methodology for estimating them.
    
    IV. GME Payment to Nonhospital Providers
    
        In the past, Medicare only paid hospitals for GME costs. 
    Therefore, FQHCs, RHCs and Medicare+Choice organizations may have 
    been reluctant to train many residents since they would incur costs 
    in training the residents but would not be reimbursed for those 
    costs by Medicare. Under this proposed regulation, where the non-
    hospital site incurs all or substantially all of the costs of the 
    training at that site, Medicare will reimburse
    
    [[Page 25679]]
    
    the provider for Medicare's share of the reasonable costs of the 
    training. The proposal to allow for payments directly to these non-
    hospital sites for the costs of training residents in approved 
    programs will facilitate more training of residents in settings that 
    will be similar to the settings that many of those residents will 
    ultimately practice after their training is completed. Additionally, 
    this could result in an increase in the number of physicians 
    practicing in underserved areas.
        In addition, hospitals are currently allowed to count residents, 
    working in nonhospital sites in their count of residents and the 
    hospital would be paid GME payments, if it paid for all or 
    substantially all of the costs of the program at the non-hospital 
    site. Previously the regulation defined the statutory requirement of 
    ``all or substantially all'' to mean at least the residents'' 
    salaries and fringe benefits. Under the proposal we would redefine 
    ``all or substantially all'' of the costs of the program at the 
    nonhospital site to also include the GME portion of the teaching 
    physicians' salaries and fringe benefits. This will require 
    hospitals to incur more of the costs of the training at the 
    nonhospital site in order to receive both direct and indirect GME 
    payments for those residents.
        Section 4625 of the Balanced Budget Act, which provides for 
    direct graduate medical education payments to nonhospital providers, 
    would have minimal impact in the context of total graduate medical 
    education costs. We believe that the most significant impact 
    resulting from section 4625 will be the movement of resident 
    training from the inpatient setting to the nonhospital setting. We 
    expect that such a shift in the site where resident training occurs 
    will result in little if any additional cost to Medicare. In 
    addition to the expected shift in training from the inpatient 
    setting to the nonhospital setting, in relatively few cases, section 
    4625 could result in additional resident training being paid by 
    Medicare. However, Medicare's share of costs incurred in those 
    nonhospital sites based on Medicare utilization is often generally 
    low, so we expect the impact of the cost of training of any 
    additional residents to be negliglible.
    
    V. Hospitals Included In and Excluded From the Prospective Payment 
    System
    
        The prospective payment systems for hospital inpatient operating 
    and capital-related costs encompass nearly all general, short-term, 
    acute care hospitals that participate in the Medicare program. There 
    were 45 Indian Health Service hospitals in our database, which we 
    excluded from the analysis due to the special characteristics of the 
    prospective payment method for these hospitals. Among other short-
    term, acute care hospitals, only the 50 such hospitals in Maryland 
    remain excluded from the prospective payment system under the waiver 
    at section 1814(b)(3) of the Act. Thus, as of March 1998, we have 
    included 4,956 hospitals in our analysis. This represents about 82 
    percent of all Medicare-participating hospitals. The majority of 
    this impact analysis focuses on this set of hospitals.
        The remaining 18 percent are specialty hospitals that are 
    excluded from the prospective payment system and continue to be paid 
    on the basis of their reasonable costs (subject to a rate-of-
    increase ceiling on their inpatient operating costs per discharge). 
    These hospitals include psychiatric, rehabilitation, long-term care, 
    children's, and cancer hospitals. The impacts of our proposed policy 
    changes on these hospitals are discussed below.
    
    VI. Impact on Excluded Hospitals and Units
    
        As of March 1998, there were 1,082 specialty hospitals excluded 
    from the prospective payment system and instead paid on a reasonable 
    cost basis subject to the rate-of-increase ceiling under 
    Sec. 413.40. In addition, there were 2,393 psychiatric and 
    rehabilitation units in hospitals otherwise subject to the 
    prospective payment system. These excluded units are also paid in 
    accordance with Sec. 413.40.
        As required by section 1886(b)(3)(B) of the Act, the update 
    factor applicable to the rate-of-increase limit for excluded 
    hospitals and units for FY 1999 would be between 0 and 2.5 percent, 
    depending on the hospital's costs in relation to its limit.
        The impact on excluded hospitals and units of the proposed 
    update in the rate-of-increase limit depends on the cumulative cost 
    increases experienced by each excluded hospital or unit since its 
    applicable base period. For excluded hospitals and units that have 
    maintained their cost increases at a level below the percentage 
    increases in the rate-of-increase limits since their base period, 
    the major effect will be on the level of incentive payments these 
    hospitals and units receive. Conversely, for excluded hospitals and 
    units with per-case cost increases above the cumulative update in 
    their rate-of-increase limits, the major effect will be the amount 
    of excess costs that would not be reimbursed.
        We note that, under Sec. 413.40(d)(3), an excluded hospital or 
    unit whose costs exceed 110 percent of its rate-of-increase limit 
    receives its rate-of-increase limit plus 50 percent of the 
    difference between its reasonable costs and 110 percent of the 
    limit, not to exceed 110 percent of its limit. In addition, under 
    the various provisions set forth in Sec. 413.40, certain excluded 
    hospitals and units can obtain payment adjustments for justifiable 
    increases in operating costs that exceed the limit. At the same 
    time, however, by generally limiting payment increases, we continue 
    to provide an incentive for excluded hospitals and units to restrain 
    the growth in their spending for patient services.
    
    VII. Quantitative Impact Analysis of the Proposed Policy Changes 
    Under the Prospective Payment System for Operating Costs
    
    A. Basis and Methodology of Estimates
    
        In this proposed rule, we are announcing policy changes and 
    payment rate updates for the prospective payment systems for 
    operating and capital-related costs. We estimate the total payment 
    impact of these changes on FY 1999 payments compared to FY 1998 
    payments, to be approximately a $400 million reduction. We have 
    prepared separate impact analyses of the proposed changes to each 
    system. This section deals with changes to the operating prospective 
    payment system.
        The data used in developing the quantitative analyses presented 
    below are taken from the FY 1997 MedPAR file and the most current 
    provider-specific file that is used for payment purposes. Although 
    the analyses of the changes to the operating prospective payment 
    system do not incorporate cost data, the most recently available 
    hospital cost report data were used to categorize hospitals. Our 
    analysis has several qualifications. First, we do not make 
    adjustments for behavioral changes that hospitals may adopt in 
    response to these proposed policy changes. Second, due to the 
    interdependent nature of the prospective payment system, it is very 
    difficult to precisely quantify the impact associated with each 
    proposed change. Third, we draw upon various sources for the data 
    used to categorize hospitals in the tables. In some cases, 
    particularly the number of beds, there is a fair degree of variation 
    in the data from different sources. We have attempted to construct 
    these variables with the best available source overall. For 
    individual hospitals, however, some miscategorizations are possible.
        Using cases in the FY 1997 MedPAR file, we simulated payments 
    under the operating prospective payment system given various 
    combinations of payment parameters. Any short-term, acute care 
    hospitals not paid under the general prospective payment systems 
    (Indian Health Service hospitals and hospitals in Maryland) are 
    excluded from the simulations. Payments under the capital 
    prospective payment system, or payments for costs other than 
    inpatient operating costs, are not analyzed here. Estimated payment 
    impacts of proposed FY 1999 changes to the capital prospective 
    payment system are discussed below in section VII of this Appendix.
        The proposed changes discussed separately below are the 
    following:
         The effects of implementing the expanded transfer 
    definition enacted by section 4407 of the BBA, which counts as a 
    transfer any discharge from one of 10 DRGs if upon discharge the 
    patient is admitted to an excluded hospital or distinct part unit or 
    a skilled nursing facility, or is provided home health care that is 
    related to the hospitalization within 3 days of the date of 
    discharge.
         The effects of the annual reclassification of diagnoses 
    and procedures and the recalibration of the DRG relative weights 
    required by section 1886(d)(4)(C) of the Act.
         The effects of changes in hospitals' wage index values 
    reflecting the wage index update (FY 1995 data).
         The effects of two proposed changes to the wage index: 
    (1) including the costs associated with Part A physician costs under 
    contract; and (2) removing the overhead costs related to departments 
    excluded from the wage data used to calculate the wage index (for 
    example, skilled nursing facilities and distinct part units).
         The effects of geographic reclassifications by the 
    Medicare Geographic Classification Review Board (MGCRB) that will be 
    effective in FY 1999.
    
    [[Page 25680]]
    
         The total change in payments based on FY 1999 policies 
    relative to payments based on FY 1998 policies.
        To illustrate the impacts of the FY 1999 proposed changes, our 
    analysis begins with a FY 1999 baseline simulation model using: The 
    FY 1998 GROUPER (version 15.0); the FY 1998 wage index; the transfer 
    definition prior to implementation of section 4407 of the BBA; and 
    no MGCRB reclassifications. Outlier payments are set at 5.1 percent 
    of total DRG payments.
        Each proposed and statutory policy change is then added 
    incrementally to this baseline model, finally arriving at an FY 1999 
    model incorporating all of the changes. This allows us to isolate 
    the effects of each change.
        Our final comparison illustrates the percent change in payments 
    per case from FY 1998 to FY 1999. Four factors have significant 
    impacts here. First is the update to the standardized amounts. In 
    accordance with section 1886(d)(3)(A)(iv) of the Act, we are 
    proposing to update the large urban and the other areas average 
    standardized amounts for FY 1999 using the most recently forecasted 
    hospital market basket increase for FY 1999 of 2.6 percent minus 1.9 
    percentage points. Similarly, section 1886(b)(3)(C)(ii) of the Act 
    provides that the update factor applicable to the hospital-specific 
    rates for sole community hospitals (SCHs), essential access 
    community hospitals (EACHs) (which are treated as SCHs for payment 
    purposes), and Medicare-dependent, small rural hospitals (MDHs) is 
    equal to the market basket increase of 2.6 percent minus 1.9 
    percentage points (for an update of 0.7 percent).
        A second significant factor impacting changes in hospitals' 
    payments per case from FY 1998 to FY 1999 is a change in MGCRB 
    reclassification status from one year to the next. That is, 
    hospitals reclassified in FY 1998 that are no longer reclassified in 
    FY 1999 may have a negative payment impact going from FY 1998 to FY 
    1999; conversely, hospitals not reclassified in FY 1998 that are 
    reclassified in FY 1999 may have a positive impact. In some cases, 
    these impacts can be quite substantial, so if a relatively small 
    number of hospitals in a particular category lose their 
    reclassification status, the percentage increase in payments for the 
    category may be below the national mean.
        A third significant factor is that we currently estimate that 
    actual outlier payments during FY 1998 will be 5.4 percent of actual 
    total DRG payments. When the FY 1998 final rule was published, we 
    projected FY 1998 outlier payments would be 5.1 percent of total DRG 
    payments, and the standardized amounts were reduced correspondingly. 
    The effects of the slightly higher than expected outlier payments 
    during FY 1998 (as discussed in the Addendum to this proposed rule) 
    are reflected in the analyses below comparing our current estimates 
    of FY 1998 payments per case to estimated FY 1999 payments per case.
        Fourth, payments per case in FY 1999 are reduced from FY 1998 
    for hospitals that receive the indirect medical education (IME) or 
    the disproportionate share (DSH) adjustments. Section 
    1886(d)(5)(B)(ii) of the Act provides that the IME adjustment is 
    reduced from approximately a 7.0 percent increase for every 10 
    percent increase in a hospital's resident-to-bed ratio in FY 1998, 
    to a 6.5 percent increase in FY 1999. Similarly, in accordance with 
    section 1886(d)(5)(F)(ix) of the Act, the DSH adjustment for FY 1999 
    is reduced by 2 percent from what would otherwise have been paid, 
    compared to a 1 percent reduction for FY 1998.
        Table I demonstrates the results of our analysis. The table 
    categorizes hospitals by various geographic and special payment 
    consideration groups to illustrate the varying impacts on different 
    types of hospitals. The top row of the table shows the overall 
    impact on the 4,956 hospitals included in the analysis. This is 132 
    fewer hospitals than were included in the impact analysis in the FY 
    1998 final rule with comment period (62 FR 46119).
        The next four rows of Table I contain hospitals categorized 
    according to their geographic location (all urban, which is further 
    divided into large urban and other urban, or rural). There are 2,792 
    hospitals located in urban areas (MSAs or NECMAs) included in our 
    analysis. Among these, there are 1,588 hospitals located in large 
    urban areas (populations over 1 million), and 1,204 hospitals in 
    other urban areas (populations of 1 million or fewer). In addition, 
    there are 2,164 hospitals in rural areas. The next two groupings are 
    by bed-size categories, shown separately for urban and rural 
    hospitals. The final groupings by geographic location are by census 
    divisions, also shown separately for urban and rural hospitals.
        The second part of Table I shows hospital groups based on 
    hospitals' FY 1999 payment classifications, including any 
    reclassifications under section 1886(d)(10) of the Act. For example, 
    the rows labeled urban, large urban, other urban, and rural show the 
    numbers of hospitals paid based on these categorizations (after 
    consideration of geographic reclassifications) are 2,877, 1,681, 
    1,196, and 2,079, respectively.
        The next three groupings examine the impacts of the proposed 
    changes on hospitals grouped by whether or not they have residency 
    programs (teaching hospitals that receive an IME adjustment), 
    receive DSH payments, or some combination of these two adjustments. 
    There are 3,875 nonteaching hospitals in our analysis, 841 teaching 
    hospitals with fewer than 100 residents, and 240 teaching hospitals 
    with 100 or more residents.
        In the DSH categories, hospitals are grouped according to their 
    DSH payment status, and whether they are considered urban or rural 
    after MGCRB reclassifications. Hospitals in the rural DSH 
    categories, therefore, represent hospitals that were not 
    reclassified for purposes of the standardized amount or for purposes 
    of the DSH adjustment. (They may, however, have been reclassified 
    for purposes of the wage index.) The next category groups hospitals 
    considered urban after geographic reclassification, in terms of 
    whether they receive the IME adjustment, the DSH adjustment, both, 
    or neither.
        The next row separately examines hospitals that available data 
    show may qualify under section 4401(b) of the BBA for the special 
    temporary relief provision, which grants an additional 0.3 percent 
    update to the standardized amounts (in addition to the 0.7 percent 
    update other hospitals would receive during FY 1999), resulting in a 
    1.0 percent update for this category of hospitals. To be eligible, a 
    hospital must not be an MDH, nor may it receive either IME or DSH 
    payments. It must also experience a negative margin on its operating 
    prospective payments during FY 1999. We estimated eligible hospitals 
    based on whether they had a negative operating margin on their FY 
    1995 cost report (latest available data). Finally, to qualify, a 
    hospital must be located in a State where the aggregate FY 1995 
    operating prospective payments were less than the aggregate 
    associated costs for all of the non-IME, non-DSH, non-MDH hospitals 
    in the State. There are 356 hospitals in this row.
        The next four rows examine the impacts of the proposed changes 
    on rural hospitals by special payment groups (SCHs, rural referral 
    centers (RRCs), MDHs, and EACHs), as well as rural hospitals not 
    receiving a special payment designation. The RRCs (137), SCH/EACHs 
    (633), MDHs (351), and SCH/EACH and RRCs (54) shown here were not 
    reclassified for purposes of the standardized amount. There is one 
    SCH that will be reclassified for the standardized amount in FY 1999 
    that, therefore, is not included in these rows. There are six EACHs 
    included in our analysis and three EACH/RRCs.
        The next two groupings are based on type of ownership and the 
    hospital's Medicare utilization expressed as a percent of total 
    patient days. These data are taken primarily from the FY 1995 
    Medicare cost report files, if available (otherwise FY 1994 data are 
    used). Data needed to determine ownership status or Medicare 
    utilization percentages were unavailable for 95 hospitals. For the 
    most part, these are new hospitals.
        The next series of groupings concern the geographic 
    reclassification status of hospitals. The first three groupings 
    display hospitals that were reclassified by the MGCRB for both FY 
    1998 and FY 1999, or for either of those 2 years, by urban/rural 
    status. The next rows illustrate the overall number of FY 1999 
    reclassifications, as well as the numbers of reclassified hospitals 
    grouped by urban and rural location. The final row in Table I 
    contains hospitals located in rural counties but deemed to be urban 
    under section 1886(d)(8)(B) of the Act.
    
    [[Page 25681]]
    
    
    
                                      Table I.--Impact Analysis of Changes for FY 1999 Operating Prospective Payment System                                 
                                                             [Percent changes in payments per case]                                                         
                                                                                                                                                            
                                                               PAC tran.                           Contract    Allocated              MGCRB recl-           
                                                   Number of     prov-      DRG re-    New wage   phys. pt a   overhead    DRG & WI     assifi-    All FY 99
                                                   hosps.\1\   ision \2\  calib. \3\   data \4\    costs \5\   costs \6\    changes   cation \8\    changes 
                                                         (0)         (1)         (2)         (3)         (4)         (5)         (6)         (7)         (8)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    (BY GEOGRAPHIC LOCATION):                                                                                                                               
        ALL HOSPITALS...........................       4,956        -0.6         0.1         0.1         0.0        -0.1         0.0         0.0        -0.7
        URBAN HOSPITALS.........................       2,792        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.4        -1.1
            LARGE URBAN.........................       1,588        -0.7         0.1        -0.3         0.0        -0.2        -0.5        -0.4        -1.4
            OTHER URBAN.........................       1,204        -0.6         0.1         0.4         0.0        -0.2         0.2        -0.3        -0.5
        RURAL HOSPITALS.........................       2,164        -0.4         0.1         0.9        -0.1         0.3         1.3         2.4         1.5
        BED SIZE (URBAN):                                                                                                                                   
            0-99 BEDS...........................         690        -0.8         0.2        -0.3         0.0        -0.1        -0.3        -0.5        -0.7
            100-199 BEDS........................         936        -0.8         0.2        -0.2         0.0        -0.1        -0.3        -0.4        -1.0
            200-299 BEDS........................         566        -0.7         0.1        -0.1         0.0        -0.1        -0.3        -0.3        -0.9
            300-499 BEDS........................         448        -0.6         0.1         0.0         0.0        -0.2        -0.3        -0.5        -1.2
            500 OR MORE BEDS....................         152        -0.5         0.1         0.3         0.0        -0.3         0.1        -0.2        -1.2
        BED SIZE (RURAL):                                                                                                                                   
            0-49 BEDS...........................       1,135        -0.3         0.1         0.9        -0.1         0.5         1.3        -0.1         1.3
            50-99 BEDS..........................         635        -0.4         0.1         0.8        -0.1         0.3         1.1         0.9         1.1
            100-149 BEDS........................         229        -0.5         0.1         0.8        -0.1         0.4         1.3         3.3         1.3
            150-199 BEDS........................          91        -0.5         0.1         1.0        -0.1         0.3         1.5         3.9         2.7
            200 OR MORE BEDS....................          74        -0.4         0.1         1.0         0.0         0.2         1.4         4.6         1.6
        URBAN BY CENSUS DIVISION:                                                                                                                           
            NEW ENGLAND.........................         152        -0.7         0.1        -2.4        -0.1         0.1        -2.7         0.1        -3.5
            MIDDLE ATLANTIC.....................         425        -0.4         0.2         0.4         0.3        -0.2         0.6        -0.5        -0.5
            SOUTH ATLANTIC......................         413        -0.6         0.1         0.8        -0.1        -0.2         0.6        -0.6        -0.3
            EAST NORTH CENTRAL..................         475        -0.8         0.1         0.0        -0.1        -0.4        -0.6        -0.3        -1.5
            EAST SOUTH CENTRAL..................         159        -0.6         0.1         0.5        -0.1        -0.4         0.0        -0.5        -0.7
            WEST NORTH CENTRAL..................         186        -0.7         0.0         0.9         0.0         0.1         1.0        -0.6         0.1
            WEST SOUTH CENTRAL..................         350        -0.9         0.1        -1.1         0.1        -0.2        -1.4        -0.1        -2.0
            MOUNTAIN............................         126        -0.8         0.1         0.4         0.2        -0.2         0.5        -0.6        -0.3
            PACIFIC.............................         458        -0.8         0.1        -0.5        -0.1         0.0        -0.7        -0.3        -1.4
            PUERTO RICO.........................          48        -0.2         0.3         0.8        -0.3        -0.3         0.3        -0.5         0.3
        RURAL BY CENSUS DIVISION:                                                                                                                           
            NEW ENGLAND.........................          53        -0.4         0.0         1.3         0.1         0.0         1.4         0.6        -0.4
            MIDDLE ATLANTIC.....................          80        -0.3         0.1         0.9         0.1         0.0         1.2         1.2         1.1
            SOUTH ATLANTIC......................         286        -0.4         0.2         0.8        -0.1         0.3         1.1         3.3         2.0
            EAST NORTH CENTRAL..................         284        -0.5         0.1         1.0        -0.3         0.3         1.2         1.9         1.5
            EAST SOUTH CENTRAL..................         269        -0.4         0.1         1.5        -0.1         0.3         1.9         2.5         2.0
    
    [[Page 25682]]
    
                                                                                                                                                            
            WEST NORTH CENTRAL..................         499        -0.4         0.0         1.1         0.0         0.7         1.9         2.1         1.8
            WEST SOUTH CENTRAL..................         341        -0.5         0.1         0.3        -0.1         0.5         0.8         3.1         0.7
            MOUNTAIN............................         206        -0.3         0.0         0.3        -0.1         0.5         0.8         1.6         1.2
            PACIFIC.............................         141        -0.6         0.1         0.4        -0.1         0.4         1.0         2.3         1.1
            PUERTO RICO.........................           5        -0.4         0.1         2.3         0.1        -0.3         2.2         1.9         0.8
    (BY PAYMENT CATEGORIES):                                                                                                                                
        URBAN HOSPITALS.........................       2,877        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.3        -1.0
            LARGE URBAN.........................       1,681        -0.7         0.1        -0.3         0.0        -0.2        -0.4        -0.3        -1.3
            OTHER URBAN.........................       1,196        -0.6         0.1         0.4         0.0        -0.2         0.2        -0.4        -0.5
        RURAL HOSPITALS.........................       2,079        -0.4         0.1         0.9        -0.1         0.4         1.3         2.0         1.4
        TEACHING STATUS:                                                                                                                                    
            NON-TEACHING........................       3,875        -0.7         0.1         0.2        -0.1         0.0         0.2         0.3        -0.1
            LESS THAN 100 RES...................         841        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.3        -0.9
            100+ RESIDENTS......................         240        -0.6         0.1         0.0         0.1        -0.2        -0.1        -0.3        -1.7
        DISPROPORTIONATE SHARE HOSPITALS (DSH):                                                                                                             
            NON-DSH.............................       3,074        -0.6         0.1         0.1         0.0        -0.1         0.1         0.3        -0.4
            URBAN DSH:                                                                                                                                      
                100 BEDS OR MORE................       1,402        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.3        -1.1
                FEWER THAN 100 BEDS.............          93        -0.7         0.2        -0.2        -0.1        -0.1        -0.3        -0.5        -0.7
            RURAL DSH:                                                                                                                                      
                SOLE COMMUNITY (SCH)............         156        -0.2         0.1         0.8        -0.1         0.2         1.1        -0.1         1.3
                REFERRAL CENTERS (RRC)..........          47        -0.5         0.2         1.3        -0.1         0.3         1.9         4.8         2.9
            OTHER RURAL DSH HOSP.:                                                                                                                          
                100 BEDS OR MORE................          64        -0.6         0.2         1.2        -0.1         0.4         1.8         1.3         0.8
                FEWER THAN 100 BEDS.............         120        -0.3         0.1         1.4        -0.1         0.4         1.8         0.0         1.7
        URBAN TEACHING AND DSH:                                                                                                                             
    
    [[Page 25683]]
    
                                                                                                                                                            
            BOTH TEACHING AND DSH...............         700        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.4        -1.4
            TEACHING AND NO DSH.................         328        -0.6         0.0         0.0         0.0        -0.3        -0.2        -0.1        -1.0
            NO TEACHING AND DSH.................         795        -0.8         0.2         0.0        -0.1        -0.1        -0.1        -0.2        -0.6
            NO TEACHING AND NO DSH..............       1,054        -0.7         0.1        -0.2         0.0        -0.1        -0.3        -0.3        -0.6
        SPECIAL UPDATE HOSPITALS (UNDER SEC.                                                                                                                
         4401(b) OF PUBLIC LAW 105-33)..........         356        -0.6         0.2         0.1        -0.1        -0.1         0.1         0.3        -0.3
        RURAL HOSPITAL TYPES:                                                                                                                               
            NONSPECIAL STATUS HOSPITALS.........         904        -0.5         0.2         1.1        -0.1         0.5         1.6         1.1         1.0
            RRC.................................         137        -0.6         0.1         1.2         0.0         0.4         1.8         5.6         2.5
            SCH/EACH............................         633        -0.2         0.0         0.4         0.0         0.2         0.6         0.1         0.8
            MDH.................................         351        -0.3         0.1         1.1        -0.1         0.5         1.5         0.4         1.3
            SCH/EACH AND RRC....................          54        -0.2         0.0         0.3         0.0         0.1         0.4         1.5         1.3
        TYPE OF OWNERSHIP:                                                                                                                                  
            VOLUNTARY...........................       2,859        -0.6         0.1         0.1         0.0        -0.1        -0.1        -0.1        -0.8
            PROPRIETARY.........................         671        -0.9         0.2         0.1        -0.1        -0.1        -0.1         0.1        -0.9
            GOVERNMENT..........................       1,331        -0.5         0.1         0.3        -0.1         0.0         0.3         0.3        -0.3
            UNKNOWN.............................          95        -0.7         0.2         0.3        -0.1        -0.1         0.2        -0.2        -0.7
        MEDICARE UTILIZATION AS A PERCENT OF                                                                                                                
         INPATIENT DAYS:                                                                                                                                    
            0-25................................         249        -0.7         0.2        -0.7        -0.1        -0.1        -1.0         0.1        -1.6
            25-50...............................       1,267        -0.7         0.1         0.0         0.0        -0.1        -0.2        -0.2        -1.2
            50-65...............................       1,975        -0.6         0.1         0.2         0.0        -0.1         0.1         0.1        -0.4
            OVER 65.............................       1,370        -0.6         0.1         0.3         0.0         0.0         0.4         0.0         0.0
            UNKNOWN.............................          95        -0.7         0.2         0.3        -0.1        -0.1         0.2        -0.2        -0.7
    HOSPITALS RECLASSIFIED BY THE MEDICARE                                                                                                                  
     GEOGRAPHIC REVIEW BOARD:                                                                                                                               
        RECLASSIFICATION STATUS DURING FY 98 AND                                                                                                            
         FY 99:                                                                                                                                             
            RECLASSIFIED DURING BOTH FY98 AND                                                                                                               
             FY99...............................         311        -0.5         0.1         0.6        -0.1         0.1         0.8         6.6        -0.1
                URBAN...........................          70        -0.5         0.1         0.2        -0.1        -0.3        -0.1         5.4        -0.5
                RURAL...........................         241        -0.5         0.1         1.0        -0.1         0.4         1.5         7.5         0.2
            RECLASSIFIED DURING FY99 ONLY.......         178        -0.5         0.1         0.8        -0.1         0.2         1.0         4.0         4.7
    
    [[Page 25684]]
    
                                                                                                                                                            
                URBAN...........................          25        -0.5         0.1         0.4        -0.1         0.0         0.4         3.1         1.9
                RURAL...........................         153        -0.5         0.1         1.0        -0.1         0.3         1.3         4.4         6.1
            RECLASSIFIED DURING FY98 ONLY.......         111        -0.7         0.1         0.6         0.0        -0.2         0.5        -0.5        -3.1
                URBAN...........................          38        -0.7         0.1         0.5         0.1        -0.3         0.2        -0.6        -2.2
                RURAL...........................          73        -0.4         0.1         0.9        -0.1         0.4         1.3        -0.5        -6.1
        FY 99 RECLASSIFICATIONS:                                                                                                                            
            ALL RECLASSIFIED HOSP...............         489        -0.5         0.1         0.7        -0.1         0.1         0.9         5.7         1.6
                STAND. AMOUNT ONLY..............          94        -0.6         0.1         0.6         0.1        -0.3         0.5         1.0        -0.3
                WAGE INDEX ONLY.................         281        -0.5         0.1         0.5        -0.1         0.3         0.8         6.6        -0.9
                BOTH............................          47        -0.6         0.2         0.9        -0.1        -0.4         0.6         3.8        -1.6
                NONRECLASSIFIED.................       4,507        -0.7         0.1         0.1         0.0        -0.1        -0.1        -0.4        -0.7
            ALL URBAN RECLASS...................          95        -0.5         0.1         0.3        -0.1        -0.2         0.0         4.7         0.2
                STAND. AMOUNT ONLY..............          25        -0.4         0.2         0.9         0.1        -0.4         0.7         0.7         0.0
                WAGE INDEX ONLY.................          45        -0.5         0.1         0.0        -0.1         0.1        -0.1         6.5         0.6
                BOTH............................          25        -0.5         0.1         0.6        -0.2        -0.6        -0.1         2.9        -0.5
                NONRECLASSIFIED.................       2,670        -0.7         0.1         0.0         0.0        -0.2        -0.2        -0.6        -1.1
            ALL RURAL RECLASS...................         394        -0.5         0.1         1.0        -0.1         0.4         1.4         6.3         2.5
                STAND. AMOUNT ONLY..............          57        -0.5         0.1         1.1        -0.2         0.3         1.5         5.1         2.4
                WAGE INDEX ONLY.................         309        -0.5         0.1         0.9        -0.1         0.4         1.4         6.1         2.3
                BOTH............................          28        -0.6         0.1         1.1        -0.1         0.3         1.6         9.2         3.8
                NONRECLASSIFIED.................       1,770        -0.3         0.1         0.9        -0.1         0.3         1.2        -0.5         0.8
        OTHER RECLASSIFIED HOSPITALS (SECTION                                                                                                               
         1886(d)(8)(B)).........................          27        -0.5         0.1        -0.9         0.2        -0.3        -0.9         0.7        -0.6
                                                  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........  ..........
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Because data necessary to classify some hospitals by category were missing, the total number of hospitals in each category may not equal the        
      national total. Discharge data are from FY 1997, and hospital cost report data are from reporting periods beginning in FY 1994 and FY 1995.           
    \2\ This column displays the impact of the change enacted by section 4407 of the BBA, which defines discharges from 1 of 10 DRGs to postacute care as   
      transfers. Under our proposed policy, 3 of the 10 DRGs would be paid under an alternative methodology where they would receive 50 percent of the full 
      DRG amount on the first day and 50 percent of the current per diem transfer payment amount for each remaining day of the stay. The remaining seven    
      DRGs would be paid using our current transfer payment methodology.                                                                                    
    \3\ This column displays the payment impact of the recalibration of the DRG weights based on FY 1997 MedPAR data and the DRG classification changes, in 
      accordance with section 1886(d)(4)(C) of the Act.                                                                                                     
    
    [[Page 25685]]
    
                                                                                                                                                            
    \4\ This column shows the payment effects of updating the data used to calculate the wage index with data from the FY 1995 cost reports.                
    \5\ This column displays the impact of adding contract Part A physician costs to the wage data.                                                         
    \6\ This column illustrates the payment impact of removing the overhead costs allocated to departments where the directly assigned costs are already    
      excluded from the wage index calculation (for example, SNFs and distinct part units).                                                                 
    \7\ This column displays the combined impact of the reclassification and recalibration of the DRGs, the updated and revised wage data used to calculate 
      the wage index, and the budget neutrality adjustment factor for these two changes, in accordance with sections 1886(d)(4)(C)(iii) and 1886(d)(3)(E) of
      the Act. Thus, it represents the combined impacts shown in columns 2, 3, 4, and 5, and the FY 1999 budget neutrality factor of 0.999227.              
    \8\ Shown here are the effects of geographic reclassifications by the Medicare Geographic Classification Review Board (MGCRB). The effects shown here   
      demonstrate the FY 1999 payment impact of going from no reclassifications to the reclassifications scheduled to be in effect for FY 1999.             
      Reclassification for prior years has no bearing on the payment impacts shown here.                                                                    
    \9\ This column shows changes in payments from FY 1998 to FY 1999. It incorporates all of the changes displayed in columns 1, 6, and 7 (the changes     
      displayed in columns 2, 3, 4 and 5 are included in column 6). It also displays the impact of the FY 1999 update, changes in hospitals'                
      reclassification status in FY 1999 compared to FY 1998, the difference in outlier payments from FY 1998 to FY 1999, and the reductions to payments    
      through the IME and DSH adjustments taking effect during FY 1999. The sum of these columns may be different from the percentage changes shown here due
      to rounding and interactive effects.                                                                                                                  
    
    B. Impact of the Proposed Implementation of the Expanded Transfer 
    Definition (Column 1)
    
        Section 1886(d)(5)(J) of the Act (added by section 4407 of the 
    BBA) requires the Secretary to select 10 DRGs for which discharges 
    (from any one of these DRGs) to a postacute care provider will be 
    treated as a transfer beginning with discharges on or after October 
    1, 1998. Column 1 shows the impact of this provision.
        Although the expanded definition encompasses only 10 DRGs, they 
    were selected, in accordance with the statute, based upon their 
    large and disproportionate volume of cases receiving postacute care. 
    We estimate that approximately 25 percent of all cases receiving 
    follow-up postacute care come from these 10 DRGs. Therefore, the 
    overall payment impact of this change is significant (a 0.6 percent 
    decrease in payments per case).
        The 10 DRGs that we are proposing to include under this 
    provision are identified in section V.A. of the preamble to this 
    proposed rule. In addition to selecting 10 DRGs, the statute 
    authorizes the Secretary to develop an alternative transfer payment 
    methodology for DRGs where a substantial portion of the costs of the 
    cases occur very early in the stay. This is particularly likely to 
    happen in some surgical DRGs because of the high cost of the 
    surgical procedure. Based on our analysis comparing the costs per 
    case for these cases with payments under our current transfer 
    payment methodology, we are proposing to pay the current transfer 
    per diem for all DRGs except DRGs 209, 210, and 211. For those three 
    DRGs, the alternative payment methodology we are proposing is 50 
    percent of the full DRG payment amount for the first day of the 
    stay, plus 50 percent of the current per diem transfer payment for 
    each remaining day, up to the full DRG payment.
        To simulate the impact of these proposed policies, we adjusted 
    hospitals' transfer-adjusted discharges and case-mix index values 
    (using version 15 of the GROUPER) to reflect the impact of this 
    expansion in the transfer definition. The transfer-adjusted 
    discharge amount is calculated one of two ways, depending on the 
    transfer payment methodology. Under our current transfer payment 
    methodology, and for all but the three DRGs receiving special 
    payment consideration, this adjustment is made simply by adding one 
    to the length of stay and dividing that amount by the geometric mean 
    length of stay for the DRG (not to exceed 1.0). For example, a 
    transfer after 3 days from a DRG with a geometric mean length of 
    stay of 6 days would have a transfer-adjusted discharge weight of 
    0.667 ((3+1)/6).
        For transfers from any one of the three DRGs receiving the 
    alternative payment methodology, the transfer-adjusted discharge 
    amount is 0.5 (to reflect that these cases receive half the full DRG 
    amount the first day), plus one-half of the result of dividing one 
    plus the length of stay prior to transfer by the geometric mean 
    length of stay for the DRG. As with the above adjustment, the result 
    is equal to the lesser of the transfer-adjusted DRG or 1.
        The transfer-adjusted case-mix index values are calculated by 
    summing the transfer-adjusted DRG weights and dividing by the 
    transfer-adjusted discharges. The transfer-adjusted DRG weights are 
    calculated by multiplying the DRG weight by the lesser of 1 or the 
    transfer-adjusted discharge for the case, divided by the geometric 
    mean length of stay for the DRG. In this way, simulated payments per 
    case can be compared before and after the change to the transfer 
    policy.
        This change has the greatest impact among urban hospitals (0.7 
    percent decrease). Among urban hospitals, smaller hospitals (under 
    200 beds) are most affected, with a 0.8 percent reduction in 
    payments. For urban hospitals grouped by census division, Puerto 
    Rico and the Middle Atlantic division have the smallest negative 
    impacts, 0.2 and 0.4 percent decreases, respectively. The Middle 
    Atlantic division has traditionally had the longest average lengths 
    of stay, therefore, it is not surprising that the impact is smallest 
    here. Transfer cases with a length of stay more than the (geometric) 
    mean length of stay minus one day do not experience any payment 
    impact under this provision. (Full payment is reached one day prior 
    to the mean length of stay due to the double per diem paid for the 
    first day under our current transfer payment methodology.) The small 
    impact in Puerto Rico would indicate that these hospitals also are 
    not discharging patients to postacute care early in the stay.
        Rural hospitals experience a smaller payment impact overall, 
    especially the smallest rural hospitals: Those with fewer than 50 
    beds (a 0.3 percent decrease). The smallest impacts among rural 
    census divisions are in the Middle Atlantic and the Mountain. The 
    largest rural impact is in the Pacific division, with a 0.6 percent 
    decrease. This change is consistent with the shorter lengths of stay 
    in this geographic region.
        The largest negative impact is a 0.9 percent decrease in 
    payments, observed among urban West South Central hospitals, and 
    proprietary hospitals. The smallest negative impact besides urban 
    Puerto Rico hospitals occurs in SCHs (0.2 percent decrease). Those 
    SCHs paid based on their hospital-specific amount would see no 
    impact related to this change, since there is no transfer adjustment 
    made to the hospital-specific amount.
    
    C. Impact of the Proposed Changes to the DRG Classifications and 
    Relative Weights (Column 2)
    
        In column 2 of Table I, we present the combined effects of the 
    DRG reclassifications and recalibration, as discussed in section II 
    of the preamble to this proposed rule. Section 1886(d)(4)(C)(I) of 
    the Act requires us to annually make appropriate classification 
    changes and to recalibrate the DRG weights in order to reflect 
    changes in treatment patterns, technology, and any other factors 
    that may change the relative use of hospital resources.
        We compared aggregate payments using the FY 1998 DRG relative 
    weights (GROUPER version 15) to aggregate payments using the 
    proposed FY 1999 DRG relative weights (GROUPER version 16). Overall, 
    payments increase by 0.1 percent due to the DRG changes, although 
    this is prior to applying the budget neutrality factor for DRG and 
    wage index changes (see column 6). Consistent with the minor changes 
    we are proposing for the FY 1999 GROUPER, the redistributional 
    impacts of DRG reclassifications and recalibration across hospital 
    groups are very small (a 0.1 percent increase for large and other 
    urban hospitals, as well as for rural hospitals). Within hospital 
    categories, the net effects for urban hospitals are small positive 
    changes for all hospitals (a 0.2 percent increase for hospitals with 
    fewer than 200 beds and a 0.1 percent increase for larger 
    hospitals). Among rural hospitals, all hospital categories 
    experience an increase of 0.1 percent.
        The breakdowns by urban census division show that the increase 
    among urban hospitals is spread across all census categories, with 
    the largest increase (0.3 percent) for hospitals in Puerto Rico. For 
    rural hospitals, there is no impact (that is, a 0.0 percent change) 
    for hospitals in the New England, West North Central, and Mountain 
    census divisions. All other divisions experience a 0.1 percent 
    increase.
        This pattern of small increases or no change applies to all 
    other hospital categories. Overall, we attribute this change to the 
    increasing severity of illness of
    
    [[Page 25686]]
    
    hospital inpatients. That is, as greater numbers of less acutely ill 
    patients are treated outside the inpatient setting, the acuity of 
    the remaining hospital inpatients increases. Although, in the past, 
    this effect was seen more clearly in large urban and very large 
    rural hospitals, which often had more outpatient settings available 
    for patient treatment, hospitals in all areas now appear to be able 
    to take advantage of this practice. Of course, in general, these 
    positive impacts are very minor, with virtually no hospital group 
    experiencing more than a 0.2 percent increase.
    
    D. Impact of Updating the Wage Data (Column 3)
    
        Section 1886(d)(3)(E) of the Act requires that, beginning 
    October 1, 1993, we annually update the wage data used to calculate 
    the wage index. In accordance with this requirement, the proposed 
    wage index for FY 1999 is based on data submitted for hospital cost 
    reporting periods beginning on or after October 1, 1994 and before 
    October 1, 1995. As with the previous column, the impact of the new 
    data on hospital payments is isolated by holding the other payment 
    parameters constant in the two simulations. That is, column 3 shows 
    the percentage changes in payments when going from a model using the 
    FY 1998 wage index based on FY 1994 wage data before geographic 
    reclassifications to a model using the FY 1999 prereclassification 
    wage index based on FY 1995 wage data.
        The wage data collected on the FY 1995 cost reports includes, 
    for the first time, contract labor costs and hours for top 
    management positions as allowable in the wage index calculation. In 
    addition, the changes to wage-related costs associated with hospital 
    and home office salaries that were discussed in the September 1, 
    1994 final rule (59 FR 45355) are reflected in the FY 1995 data. 
    These changes are reflected in column 3, as well as other year-to-
    year changes in hospitals' labor costs.
        The results indicate that the new wage data have an overall 
    impact of a 0.1 percent increase in hospital payments (prior to 
    applying the budget neutrality factor, see column 6). Rural 
    hospitals especially appear to benefit from the update. Their 
    payments increase by 0.9 percent. These increases are attributable 
    to relatively large increases in the wage index values for the rural 
    areas of particular States; South Dakota, Hawaii, Mississippi, 
    Wyoming, New Hampshire, and Iowa all had increases greater than 6 
    percent in their prereclassification wage index values.
        Urban hospitals as a group are not significantly affected by the 
    updated wage data. The gains of hospitals in other urban areas (0.4 
    percent increase) are offset by decreases among hospitals in large 
    urban areas (0.3 percent decrease). The negative impact among large 
    urban areas appears to be largely due to a 5.8 percent decrease in 
    the wage index values for the Boston MSA. This impact is especially 
    evident in the 2.4 percent decrease for urban New England hospitals. 
    Urban West South Central hospitals experience a 1.1 percent 
    decrease, largely due to 11 Texas MSAs with FY 1999 wage indexes 
    that fall by more than 7 percent. These appear to be primarily 
    related to large changes in the average hourly wages of individual 
    hospitals in MSAs with only a few hospitals. We would point out that 
    the wage data used for the proposed wage index is not final, and we 
    understand that many hospitals have submitted revision requests. To 
    the extent these requests are granted by hospitals' fiscal 
    intermediaries, these revisions are likely to affect the impacts 
    shown in the final rule. In addition, we continue to verify the 
    accuracy of the data for hospitals with extraordinary changes in 
    their data from the prior year. We anticipate that all these 
    verifications will be completed when we calculate the final FY 1999 
    wage index.
        The largest increases are seen in the rural census divisions. 
    Rural Puerto Rico experiences the greatest positive impact, 2.3 
    percent. Hospitals in three other census divisions receive positive 
    impacts over 1.0 percent; East South Central at 1.5 percent, New 
    England at 1.3 percent, and West North Central at 1.1 percent. We 
    believe these positive impacts of the new wage data for rural 
    hospitals stem from the expansion of the contract labor definition, 
    specifically to include certain management categories. On average, 
    the hourly cost of contract labor increased for rural hospitals by 
    5.9 percent. Among urban hospitals, the increase was 4.2 percent.
    
    E. Impact of Including Contract Physician Part A Costs (Column 4)
    
        As discussed in section III.C.1 of the preamble, we began 
    collecting separate wage data for both direct and contract physician 
    Part A services on the FY 1995 cost report. This change was made in 
    order to address any potential inequity of including only salaried 
    Part A physician costs in the wage index while some States had laws 
    prohibiting their hospitals from employing physicians directly 
    (forcing hospitals to contract with physicians for administrative 
    services). Based on our analysis, we are proposing to include 
    contract physician Part A costs in the wage index calculation.
        Column 4 shows the payment impacts of including these data. 
    Although only two States currently maintain the prohibition against 
    hospitals directly employing physicians (Texas and California), many 
    hospitals in other States reported these costs as well. Thus, the 
    impacts of this proposed change extend well beyond Texas and 
    California. In fact, the urban Middle Atlantic census division shows 
    the largest positive impact from this change (0.3 percent).
        In general, hospitals in other areas experience either no 
    changes due to this proposed policy, or small (0.1 percent) 
    increases or decreases. However, urban hospitals in Puerto Rico and 
    rural hospitals in the East North Central census division experience 
    0.3 percent decreases. The negative rural East North Central impact 
    is largely due to a negative impact of this change on the rural 
    Wisconsin wage index.
        As noted above, the data used to prepare the proposed FY 1999 
    wage index are subject to revision, and we understand that many 
    hospitals requested changes to their contract physician Part A costs 
    prior to the March 9 deadline for all requests for wage data changes 
    to be submitted to the fiscal intermediaries. The extent of these 
    requests and the number which are approved by the fiscal 
    intermediaries may change the impacts in the final rule.
    
    F. Impact of Removing Overhead Costs of Excluded Areas (Column 5)
    
        Prior years' wage index calculations have removed the direct 
    wages and hours associated with certain subprovider components 
    excluded from the prospective payment system; however, the overhead 
    costs associated with these excluded components have not been 
    removed. We revised the FY 1995 cost report to allow hospitals to 
    report separately overhead salaries and hours, and we are proposing 
    to remove the overhead costs and hours allocated to areas of the 
    hospital excluded from the wage index calculation.
        Column 5 displays the impacts on FY 1999 payments per case of 
    implementing this change. The overall impact is a 0.1 percent 
    decline in payments; however, once again (as with the impacts of the 
    FY 1995 data), the impact diverges along urban and rural lines. 
    Urban hospitals lose 0.2 percent as a result of removing these 
    overhead costs, while rural hospitals gain 0.3 percent. Among rural 
    hospitals by bed size, the smallest rural hospitals benefit the 
    most, with a 0.5 percent increase for rural hospitals with fewer 
    than 50 beds.
        Hospitals in the rural West North Central census division 
    experience the largest percentage increase (0.7 percent). The 
    largest negative impacts are in Puerto Rico (urban and rural), and 
    urban East North Central and urban East South Central.
        The combined wage index changes in Table I are determined by 
    summing the individual impacts in columns 3, 4, and 5. For example, 
    the rural West North Central census division gains 1.1 percent from 
    the new wage data, and 0.7 percent from removing the overhead costs 
    allocated to excluded areas. Therefore, the combined impact of the 
    FY 1999 wage index for these hospitals is a 1.8 percent increase.
        The following chart compares the shifts in wage index values for 
    labor market areas for FY 1999 relative to FY 1998. This chart 
    demonstrates the impact of the proposed changes for the FY 1999 wage 
    index relative to the FY 1998 wage index. The majority of labor 
    market areas (282) experience less than a 5 percent change. A total 
    of 54 labor market areas experience an increase of more than 5 
    percent with 13 having an increase greater than 10 percent. A total 
    of 34 areas experience decreases of more than 5 percent (all urban). 
    Of those, 6 decline by 10 percent or more.
    
    ------------------------------------------------------------------------
                                                           Number of labor  
                                                            market areas    
        Percentage change in area wage index values    ---------------------
                                                         FY 1998    FY 1999 
    ------------------------------------------------------------------------
    Increase more than 10 percent.....................          2         13
    Increase more than 5 percent and less than 10                           
     percent..........................................         24         41
    Increase or decrease less than 5 percent..........        334        282
    
    [[Page 25687]]
    
                                                                            
    Decrease more than 5 percent and less than 10                           
     percent..........................................          9         28
    Decrease more than 10 percent.....................          1          6
    ------------------------------------------------------------------------
    
        Among urban hospitals, 164 would experience an increase of more 
    than 5 percent and 29 more than 10 percent. More rural hospitals 
    have increases greater than 5 percent (360), but none greater than 
    10 percent. On the negative side, 268 urban hospitals but no rural 
    hospitals have decreases in their wage index values of at least 5 
    percent (30 of the urban hospitals have decreases greater than 10 
    percent). The following chart shows the projected impact for urban 
    and rural hospitals.
    
    ------------------------------------------------------------------------
                                                         Number of hospitals
        Percentage change in area wage index values    ---------------------
                                                          Urban      Rural  
    ------------------------------------------------------------------------
    Increase more than 10 percent.....................         29          0
    Increase more than 5 percent and less than 10                           
     percent..........................................        164        360
    Increase or decrease less than 5 percent..........       2440       1924
    Decrease more than 5 percent and less than 10                           
     percent..........................................        238          0
    Decrease more than 10 percent.....................         30          0
    ------------------------------------------------------------------------
    
    G. Combined Impact of DRG and Wage Index Changes--Including Budget 
    Neutrality Adjustment (Column 6)
    
        The impact of DRG reclassifications and recalibration on 
    aggregate payments is required by section 1886(d)(4)(C)(iii) of the 
    Act to be budget neutral. In addition, section 1886(d)(3)(E) of the 
    Act specifies that any updates or adjustments to the wage index are 
    to be budget neutral. As noted in the Addendum to this proposed 
    rule, we compared aggregate payments using the FY 1998 DRG relative 
    weights and wage index to aggregate payments using the FY 1999 DRG 
    relative weights and wage index. Based on this comparison, we 
    computed a wage and recalibration budget neutrality factor of 
    0.999227. In Table I, the combined overall impacts of the effects of 
    both the DRG reclassifications and recalibration and the updated 
    wage index are shown in column 6. The 0.0 percent impact for All 
    Hospitals demonstrates that these changes, in combination with the 
    budget neutrality factor, are budget neutral.
        For the most part, the changes in this column are the sum of the 
    changes in columns 2, 3, 4, and 5, minus approximately 0.1 percent 
    attributable to the budget neutrality factor. There may, of course, 
    be some variation of plus or minus 0.1 percent due to rounding.
    
    H. Impact of MGCRB Reclassifications (Column 7)
    
        Our impact analysis to this point has assumed hospitals are paid 
    on the basis of their actual geographic location (with the exception 
    of ongoing policies that provide that certain hospitals receive 
    payments on bases other than where they are geographically located, 
    such as hospitals in rural counties that are deemed urban under 
    section 1886(d)(8)(B) of the Act). The changes in column 7 reflect 
    the per case payment impact of moving from this baseline to a 
    simulation incorporating the MGCRB decisions for FY 1999. As noted 
    below, these decisions affect hospitals' standardized amount and 
    wage index area assignments. In addition, rural hospitals 
    reclassified for purposes of the standardized amount qualify to be 
    treated as urban for purposes of the DSH adjustment.
        Beginning in 1998, by February 28 of each year, the MGCRB makes 
    reclassification determinations that will be effective for the next 
    fiscal year, which begins on October 1. (In previous years, these 
    determinations were made by March 30.) The MGCRB may approve a 
    hospital's reclassification request for the purpose of using the 
    other area's standardized amount, wage index value, or both or for 
    FYS 1999-2001 for purposes of qualifying for a DSH adjustment or to 
    receive a higher DSH payment.
        The proposed FY 1999 wage index values incorporate all of the 
    MGCRB's reclassification decisions for FY 1999. The wage index 
    values also reflect any decisions made by the HCFA Administrator 
    through the appeals and review process for MGCRB decisions as of 
    February 27, 1998. Additional changes that result from the 
    Administrator's review of MGCRB decisions or a request by a hospital 
    to withdraw its application will be reflected in the final rule for 
    FY 1999.
        The overall effect of geographic reclassification is required by 
    section 1886(d)(8)(D) of the Act to be budget neutral. Therefore, we 
    applied an adjustment of 0.994019 to ensure that the effects of 
    reclassification are budget neutral. (See section II.A.4 of the 
    Addendum to this proposed rule.)
        As a group, rural hospitals benefit from geographic 
    reclassification. Their payments rise 2.4 percent, while payments to 
    urban hospitals decline 0.4 percent. Hospitals in other urban areas 
    see a decrease in payments of 0.3 percent, while large urban 
    hospitals lose 0.4 percent. Among urban hospital groups (that is, 
    bed size, census division, and special payment status), payments 
    generally decline.
        A positive impact is evident among all rural hospital groups 
    except the smallest hospitals (under 50 beds), which experience a 
    slight decrease of 0.1 percent. The smallest increase among the 
    rural census divisions is 0.6 percent for New England. The largest 
    increase is in rural South Atlantic, with an increase of 3.3 
    percent.
        Among rural hospitals designated as RRCs, 108 hospitals are 
    reclassified for purposes of the wage index only, leading to the 5.6 
    percent increase in payments among RRCs overall. This positive 
    impact on RRCs is also reflected in the category of rural hospitals 
    with 200 or more beds, which has a 4.6 percent increase in payments.
        Rural hospitals reclassified for FY 1998 and FY 1999 experience 
    a 6.6 percent increase in payments. This may be due to the fact that 
    these hospitals have the most to gain from reclassification and have 
    been reclassified for a period of years. Rural hospitals 
    reclassified for FY 1999 only experience a 4.4 percent increase in 
    payments, while rural hospitals reclassified for FY 1998 only 
    experience a 0.5 percent decrease in payments. Urban hospitals 
    reclassified for FY 1998 but not FY 1999 experience a 0.6 percent 
    decline in payments overall. Urban hospitals reclassified for FY 
    1999 but not for FY 1998 experience a 3.1 percent increase in 
    payments.
        The FY 1999 Reclassification rows of Table I show the changes in 
    payments per case for all FY 1999 reclassified and nonreclassified 
    hospitals in urban and rural locations for each of the three 
    reclassification categories (standardized amount only, wage index 
    only, or both). The table illustrates that the largest impact for 
    reclassified rural hospitals is for those hospitals reclassified for 
    both the standardized amount and the wage index. These hospitals 
    receive a 9.2 percent increase in payments. In addition, rural 
    hospitals reclassified just for the wage index receive a 6.1 percent 
    payment increase. The overall impact on reclassified hospitals is to 
    increase their payments per case by an average of 5.7 percent for FY 
    1999.
        Among the 27 rural hospitals deemed to be urban under section 
    1886(d)(8)(B) of the Act, payments increase 0.7 percent due to MGCRB 
    reclassification. This is because, although these hospitals are 
    treated as being attached to an urban area in our baseline (their 
    redesignation is ongoing, rather than annual like the MGCRB 
    reclassifications), they are eligible for MGCRB reclassification. 
    For FY 1999, one hospital in this category reclassified to a large 
    urban area.
        The reclassification of hospitals primarily affects payment to 
    nonreclassified hospitals through changes in the wage index and the 
    geographic reclassification budget neutrality adjustment required by 
    section 1886(d)(8)(D) of the Act. Among hospitals that are not 
    reclassified, the overall impact of hospital reclassifications is an 
    average decrease in payments per case of about 0.4 percent. Rural 
    nonreclassified hospitals decrease slightly more, experiencing a 0.5 
    percent decrease, and urban nonreclassified hospitals lose 0.6 
    percent (the amount of the budget neutrality offset).
        The number of reclassifications for purposes of the standardized 
    amount, or for both the standardized amount and the wage index, has 
    increased from 149 in FY 1998 to 162 in FY 1999. The number of wage 
    index only reclassifications increased from 284 in FY 1998 to 358 in 
    FY 1999. These increases are mainly attributable to two changes made 
    by the BBA. Section 4202 of the BBA amended section 1886(d)(10)(D) 
    of the Act to allow RRCs to reclassify for wage index purposes based 
    only on comparison of the RRC's average hourly wage to the average 
    hourly wage of the area to which it applies to be reclassified. In 
    addition, section 4203 provides that for FYs 1999-2001, a rural
    
    [[Page 25688]]
    
    hospital may be reclassified to an other urban area for the sole 
    purpose of receiving a higher DSH payment.
        The foregoing analysis was based on MGCRB and HCFA Administrator 
    decisions made by February 27 of this year. As previously noted, 
    there may be changes to some MGCRB decisions through the appeals, 
    review, and applicant withdrawal process. The outcome of these cases 
    will be reflected in the analysis presented in the final rule.
    
    I. All Changes (Column 8)
    
        Column 8 compares our estimate of payments per case, 
    incorporating all changes reflected in this proposed rule for FY 
    1999 (including statutory changes), to our estimate of payments per 
    case in FY 1998. It includes the effects of the 0.7 percent update 
    to the standardized amounts and the hospital-specific rates for 
    SCHs, EACHs, and MDHs. It also reflects the 0.3 percentage point 
    difference between the projected outlier payments in FY 1999 (5.1 
    percent of total DRG payments) and the current estimate of the 
    percentage of actual outlier payments in FY 1998 (5.4 percent), as 
    described in the introduction to this Appendix and the Addendum to 
    this proposed rule.
        Additional changes affecting the difference between FY 1998 and 
    FY 1999 payments are the reductions to the IME and DSH adjustments 
    enacted by the BBA. These changes initially went into effect during 
    FY 1998 and include additional decreases in payment for each of 
    several succeeding years. As noted in the introduction to this 
    impact analysis, for FY 1999, IME is reduced to approximately a 6.5 
    percent rate of increase, and DSH is reduced by 2 percent from what 
    hospitals otherwise would receive. We estimate the overall effect of 
    these statutory changes to be a 0.4 percent reduction in FY 1999 
    payments. For hospitals receiving both IME and DSH, the impact is 
    estimated to be a 0.9 percent reduction in payments per case.
        We also note that column 8 includes the impacts of FY 1999 MGCRB 
    reclassifications compared to the payment impacts of FY 1998 
    reclassifications. Therefore, when comparing FY 1999 payments to FY 
    1998, the percent changes due to FY 1999 reclassifications shown in 
    column 7 need to be offset by the effects of reclassification on 
    hospitals' FY 1998 payments (column 7 of Table 1, August 29, 1997 
    final rule with comment period; 62 FR 46119). For example, the 
    impact of MGCRB reclassifications on rural hospitals' FY 1998 
    payments was approximately a 2.2 percent increase, offsetting much 
    of the 2.4 percent increase in column 7 for FY 1999. Therefore, the 
    net change in FY 1999 payments due to reclassification for rural 
    hospitals is actually closer to an increase of 0.2 percent relative 
    to FY 1998. However, last year's analysis contained a somewhat 
    different set of hospitals, so this might affect the numbers 
    slightly.
        There might also be interactive effects among the various 
    factors comprising the payment system that we are not able to 
    isolate. For these reasons, the values in column 8 may not equal the 
    sum of the changes in columns 1, 6, and 7, plus the other impacts 
    that we are able to identify.
        The overall payment change from FY 1998 to FY 1999 for all 
    hospitals is a 0.7 percent decrease. This reflects the 0.6 percent 
    net change in total payments due to the postacute transfer change 
    for FY 1999 shown in column 1; the 0.7 percent update for FY 1999, 
    the 0.3 percent lower outlier payments in FY 1999 compared to FY 
    1998 (5.1 percent compared to 5.4 percent); and the 0.4 percent 
    reduction due to lower IME and DSH payments.
        Hospitals in urban areas experience a 1.1 percent drop in 
    payments per case compared to FY 1998. Urban hospitals lose 0.9 
    percent due to the expanded transfer definition and the DRG and wage 
    index changes combined. The 0.4 percent negative impact due to 
    reclassification is offset by an identical negative impact for FY 
    1998. The impact of reducing IME and DSH is a 0.6 percent reduction 
    in FY 1999 payments per case. Most of this negative impact is 
    incurred by hospitals in large urban areas, where payments are 
    expected to fall 1.4 percent per case compared to 0.5 percent per 
    case for hospitals in other urban areas.
        Hospitals in rural areas, meanwhile, experience a 1.5 percent 
    payment increase. As discussed previously, this is primarily due to 
    a smaller negative impact due to the expanded transfer definition 
    (0.4 percent decrease compared to 0.6 percent nationally) and the 
    positive effect due to the wage index and DRG changes (1.3 percent 
    increase).
        Among census divisions, urban New England displays the largest 
    negative impact, 3.5 percent. This outcome is primarily related to the 
    2.4 percent decrease due to the new wage data. Similarly, urban West 
    South Central experiences a 2.0 percent drop in payments per case, due 
    to a 1.1 percent drop due to the new wage data. The urban East North 
    Central and the urban Pacific also experience overall payment declines 
    of more than 1.0 percent, with 1.5 and 1.4 percent decreases, 
    respectively. The West North Central is the only urban census category 
    to experience a rise in payments, stemming primarily from a 0.9 percent 
    increase due to the new wage data. Hospitals in this census division 
    also are less reliant on IME and DSH funding, and are therefore, 
    impacted less by these reductions.
        The only rural census division to experience a negative payment 
    impact is New England (0.4 percent fall). This appears to result from a 
    much smaller reclassification effect for rural New England hospitals in 
    FY 1999. For FY 1998, the impact of MGCRB reclassification for these 
    hospitals was a 2.1 percent increase (see 62 FR 46119). For FY 1999, 
    the increase is only 0.6 percent. The largest increases by rural census 
    division are in the South Atlantic and the East South Central, both 
    with 2.0 percent increases in their FY 1999 payments per case. In the 
    South Atlantic, this is primarily due to a larger FY 1999 benefit from 
    MGCRB reclassifications. For the East South Central, it is largely due 
    to a 1.5 percent increase from the FY 1995 wage data.
        Among special categories of rural hospitals, RRCs have the largest 
    increase, 2.5 percent. This carries over to other categories as well: 
    rural hospitals with between 150 and 200 beds have a 2.7 percent rise 
    in payments (there are 37 RRCs in this category); and RRCs receiving 
    DSH see a 2.9 percent increase.
        The largest negative payment impacts from FY 1998 to FY 1999 are 
    among hospitals that were reclassified for FY 1998 and are not 
    reclassified for FY 1999. Overall, these hospitals lose 3.1 percent. 
    The urban hospitals in this category lose 2.2 percent, while the rural 
    hospitals lose 6.1 percent. On the other hand, hospitals reclassified 
    for FY 1999 that were not reclassified for FY 1998 would experience the 
    greatest payment increases: 4.7 percent overall; 6.1 percent for 153 
    rural hospitals in this category and 1.9 percent for 25 urban 
    hospitals.
    
                 Table II.--Impact Analysis of Changes for FY 1999 Operating Prospective Payment System             
                                                   [Payments per case]                                              
                                                                                                                    
                                                                                Average FY   Average FY             
                                                                   Number of       1998         1999                
                                                                   hospitals   payment per  payment per  All changes
                                                                                   case         case                
                                                                          (1)      (2) \1\      (3) \1\          (4)
    ----------------------------------------------------------------------------------------------------------------
    (BY GEOGRAPHIC LOCATION):                                                                                       
        ALL HOSPITALS...........................................        4,956        6,764        6,715         -0.7
        URBAN HOSPITALS.........................................        2,792        7,332        7,255         -1.1
        LARGE URBAN AREAS.......................................        1,588        7,891        7,782         -1.4
    
    [[Page 25689]]
    
                                                                                                                    
        OTHER URBAN AREAS.......................................        1,204        6,584        6,549         -0.5
        RURAL AREAS.............................................        2,164        4,461        4,528          1.5
    BED SIZE (URBAN):                                                                                               
        0-99 BEDS...............................................          690        4,922        4,890         -0.7
        100-199 BEDS............................................          936        6,127        6,069         -1.0
        200-299 BEDS............................................          566        6,921        6,860         -0.9
        300-499 BEDS............................................          448        7,839        7,744         -1.2
        500 OR MORE BEDS........................................          152        9,724        9,607         -1.2
    BED SIZE (RURAL):                                                                                               
        0-49 BEDS...............................................        1,135        3,663        3,712          1.3
        50-99 BEDS..............................................          635        4,173        4,218          1.1
        100-149 BEDS............................................          229        4,609        4,669          1.3
        150-199 BEDS............................................           91        4,799        4,927          2.7
        200 OR MORE BEDS........................................           74        5,603        5,692          1.6
    URBAN BY CENSUS DIV.:                                                                                           
        NEW ENGLAND.............................................          152        7,873        7,597         -3.5
        MIDDLE ATLANTIC.........................................          425        8,168        8,123         -0.5
        SOUTH ATLANTIC..........................................          413        6,973        6,955         -0.3
        EAST NORTH CENTRAL......................................          475        7,016        6,909         -1.5
        EAST SOUTH CENTRAL......................................          159        6,558        6,511         -0.7
        WEST NORTH CENTRAL......................................          186        7,001        7,011          0.1
        WEST SOUTH CENTRAL......................................          350        6,807        6,672         -2.0
        MOUNTAIN................................................          126        7,065        7,045         -0.3
        PACIFIC.................................................          458        8,403        8,289         -1.4
        PUERTO RICO.............................................           48        3,049        3,057          0.3
    RURAL BY CENSUS DIV.:                                                                                           
        NEW ENGLAND.............................................           53        5,308        5,285         -0.4
        MIDDLE ATLANTIC.........................................           80        4,802        4,857          1.1
        SOUTH ATLANTIC..........................................          286        4,606        4,697          2.0
        EAST NORTH CENTRAL......................................          284        4,492        4,559          1.5
        EAST SOUTH CENTRAL......................................          269        4,160        4,242          2.0
        WEST NORTH CENTRAL......................................          499        4,174        4,250          1.8
        WEST SOUTH CENTRAL......................................          341        3,989        4,019          0.7
        MOUNTAIN................................................          206        4,815        4,871          1.2
        PACIFIC.................................................          141        5,603        5,664          1.1
        PUERTO RICO.............................................            5        2,369        2,389          0.8
    (BY PAYMENT CATEGORIES):                                                                                        
        URBAN HOSPITALS.........................................        2,877        7,289        7,215         -1.0
        LARGE URBAN AREAS.......................................        1,681        7,795        7,691         -1.3
        OTHER URBAN AREAS.......................................        1,196        6,564        6,533         -0.5
        RURAL AREAS.............................................        2,079        4,440        4,501          1.4
    TEACHING STATUS:                                                                                                
        NON-TEACHING............................................        3,875        5,478        5,472         -0.1
        FEWER THAN 100 RESIDENTS................................          841        7,219        7,155         -0.9
        100 OR MORE RESIDENTS...................................          240       10,987       10,796         -1.7
    DISPROPORTIONATE SHARE HOSPITALS (DSH):                                                                         
        NON-DSH.................................................        3,074        5,830        5,809         -0.4
        URBAN DSH:                                                                                                  
            100 BEDS OR MORE....................................        1,402        7,941        7,850         -1.1
            FEWER THAN 100 BEDS.................................           93        5,024        4,990         -0.7
        RURAL DSH:                                                                                                  
            SOLE COMMUNITY (SCH)................................          156        4,255        4,310          1.3
            REFERRAL CENTERS (RRC)..............................           47        5,293        5,446          2.9
        OTHER RURAL DSH HOSP.:                                                                                      
            100 BEDS OR MORE....................................           64        4,196        4,229          0.8
            FEWER THAN 100 BEDS.................................          120        3,572        3,633          1.7
        URBAN TEACHING AND DSH:                                                                                     
            BOTH TEACHING AND DSH...............................          700        8,961        8,837         -1.4
            TEACHING AND NO DSH.................................          328        7,390        7,318         -1.0
            NO TEACHING AND DSH.................................          795        6,342        6,303         -0.6
            NO TEACHING AND NO DSH..............................        1,054        5,661        5,626         -0.6
        SPECIAL UPDATE HOSPITALS (UNDER SEC. 4401(b) OF PUBLIC                                                      
         LAW 105-33.............................................          356        5,322        5,305         -0.3
        RURAL HOSPITAL TYPES:                                                                                       
            NONSPECIAL STATUS                                                                                       
            HOSPITALS...........................................          904        3,948        3,986          1.0
    
    [[Page 25690]]
    
                                                                                                                    
            RRC.................................................          137        5,182        5,309          2.5
            SCH/EACH............................................          633        4,490        4,525          0.8
            MDH.................................................          351        3,701        3,747          1.3
            SCH/EACH AND RRC....................................           54        5,363        5,433          1.3
        TYPE OF OWNERSHIP:                                                                                          
            VOLUNTARY...........................................        2,859        6,949        6,894         -0.8
            PROPRIETARY.........................................          671        6,148        6,092         -0.9
            GOVERNMENT..........................................        1,331        6,233        6,215         -0.3
            UNKNOWN.............................................           95        7,984        7,928         -0.7
        MEDICARE UTILIZATION AS A PERCENT OF INPATIENT DAYS:                                                        
            0-25................................................          249        8,884        8,740         -1.6
            25-50...............................................        1,267        8,243        8,142         -1.2
            50-65...............................................        1,975        6,168        6,143         -0.4
            OVER 65.............................................        1,370        5,250        5,247          0.0
            UNKNOWN.............................................           95        7,984        7,928         -0.7
    HOSPITALS RECLASSIFIED BY THE MEDICARE GEOGRAPHIC REVIEW                                                        
     BOARD:                                                                                                         
        RECLASSIFICATION STATUS DURING FY98 AND FY99:                                                               
            RECLASSIFIED DURING BOTH FY98 AND FY99..............          311        5,995        5,989         -0.1
                URBAN...........................................           70        7,505        7,468         -0.5
                RURAL...........................................          241        5,250        5,258          0.2
            RECLASSIFIED DURING FY99 ONLY.......................          178        5,512        5,773          4.7
                URBAN...........................................           25        8,442        8,605          1.9
                RURAL...........................................          153        4,705        4,993          6.1
            RECLASSIFIED DURING FY98 ONLY.......................          111        6,192        6,000         -3.1
                URBAN...........................................           38        7,018        6,865         -2.2
                RURAL...........................................           73        4,458        4,185         -6.1
        FY 99 RECLASSIFICATIONS:                                                                                    
            ALL RECLASSIFIED HOSP...............................          489        5,815        5,908          1.6
                STAND. AMT. ONLY................................           94        5,938        5,920         -0.3
                WAGE INDEX ONLY.................................          281        5,994        5,940         -0.9
                BOTH............................................           47        6,390        6,290         -1.6
                NONRECLASS......................................        4,507        6,844        6,795         -0.7
            ALL URBAN RECLASS...................................           95        7,767        7,786          0.2
                STAND. AMT. ONLY................................           25        5,922        5,924          0.0
                WAGE INDEX ONLY.................................           45        9,138        9,194          0.6
                BOTH............................................           25        6,679        6,647         -0.5
                NONRECLASS......................................        2,670        7,327        7,245         -1.1
            ALL RURAL RECLASS...................................          394        5,026        5,149          2.5
                STAND. AMT. ONLY................................           57        4,516        4,626          2.4
                WAGE INDEX ONLY.................................          309        5,086        5,204          2.3
                BOTH............................................           28        5,038        5,230          3.8
                NONRECLASS......................................        1,770        4,106        4,137          0.8
        OTHER RECLASSIFIED HOSPITALS (SECTION 1886(d)(8)(B))....           27        4,725        4,695        -0.6 
    ----------------------------------------------------------------------------------------------------------------
    \1\ These payment amounts per case do not reflect any estimates of annual case-mix increase.                    
    
        Table II presents the projected impact of the proposed changes 
    for FY 1999 for urban and rural hospitals and for the different 
    categories of hospitals shown in Table I. It compares the projected 
    payments per case for FY 1999 with the average estimated per case 
    payments for FY 1998, as calculated under our models. Thus, this 
    table presents, in terms of the average dollar amounts paid per 
    discharge, the combined effects of the changes presented in Table I. 
    The percentage changes shown in the last column of Table II equal 
    the percentage changes in average payments from column 8 of Table I.
    
    VIII. Impact of Proposed Changes in the Capital Prospective Payment 
    System
    
    A. General Considerations
    
        We now have data that were unavailable in previous impact 
    analyses for the capital prospective payment system. Specifically, 
    we have cost report data available for the fourth year of the 
    capital prospective payment system (cost reports beginning in FY 
    1995) available through the December 1997 update of the Health Care 
    Provider Cost Report Information System (HCRIS). We also have 
    updated information on the projected aggregate amount of obligated 
    capital approved by the fiscal intermediaries. However, our impact 
    analysis of payment changes for capital-related costs is still 
    limited by the lack of hospital-specific data on several items. 
    These are the hospital's projected new capital costs for each year, 
    its projected old capital costs for each year, and the actual 
    amounts of obligated capital that will be put in use for patient 
    care and recognized as Medicare old capital costs in each year. The 
    lack of this information affects our impact analysis in the 
    following ways:
         Major investment in hospital capital assets (for 
    example in building and major fixed equipment) occurs at irregular 
    intervals. As a result, there can be significant variation in the 
    growth rates of Medicare capital-related costs per case among 
    hospitals. We do not have the necessary hospital-specific budget 
    data to project the hospital capital growth rate for individual 
    hospitals.
    
    [[Page 25691]]
    
         Moreover, our policy of recognizing certain obligated 
    capital as old capital makes it difficult to project future capital-
    related costs for individual hospitals. Under Sec. 412.302(c), a 
    hospital is required to notify its intermediary that it has 
    obligated capital by the later of October 1, 1992, or 90 days after 
    the beginning of the hospital's first cost reporting period under 
    the capital prospective payment system. The intermediary must then 
    notify the hospital of its determination whether the criteria for 
    recognition of obligated capital have been met by the later of the 
    end of the hospital's first cost reporting period subject to the 
    capital prospective payment system or 9 months after the receipt of 
    the hospital's notification. The amount that is recognized as old 
    capital is limited to the lesser of the actual allowable costs when 
    the asset is put in use for patient care or the estimated costs of 
    the capital expenditure at the time it was obligated. We have 
    substantial information regarding intermediary determinations of 
    projected aggregate obligated capital amounts. However, we still do 
    not know when these projects will actually be put into use for 
    patient care, the actual amount that will be recognized as obligated 
    capital when the project is put into use, or the Medicare share of 
    the recognized costs. Therefore, we do not know actual obligated 
    capital commitments for purposes of the FY 1999 capital cost 
    projections. In Appendix B of this proposed rule, we discuss the 
    assumptions and computations that we employ to generate the amount 
    of obligated capital commitments for use in the FY 1999 capital cost 
    projections.
        In Table III of this section, we present the redistributive 
    effects that are expected to occur between ``hold-harmless'' 
    hospitals and ``fully prospective'' hospitals in FY 1999. In 
    addition, we have integrated sufficient hospital-specific 
    information into our actuarial model to project the impact of the 
    proposed FY 1999 capital payment policies by the standard 
    prospective payment system hospital groupings. While we now have 
    actual information on the effects of the transition payment 
    methodology and interim payments under the capital prospective 
    payment system and cost report data for most hospitals, we still 
    need to randomly generate numbers for the change in old capital 
    costs, new capital costs for each year, and obligated amounts that 
    will be put in use for patient care services and recognized as old 
    capital each year. We continue to be unable to predict accurately FY 
    1999 capital costs for individual hospitals, but with the most 
    recent data hospitals' experience under the capital prospective 
    payment system, there is adequate information to estimate the 
    aggregate impact on most hospital groupings.
    
    B. Projected Impact Based on the Proposed FY 1999 Actuarial Model
    
        1. Assumptions. In this impact analysis, we model dynamically 
    the impact of the capital prospective payment system from FY 1998 to 
    FY 1999 using a capital cost model. The FY 1999 model, as described 
    in Appendix B of this proposed rule, integrates actual data from 
    individual hospitals with randomly generated capital cost amounts. 
    We have capital cost data from cost reports beginning in FY 1989 
    through FY 1995 as reported on the December 1997 update of HCRIS, 
    interim payment data for hospitals already receiving capital 
    prospective payments through PRICER, and data reported by the 
    intermediaries that include the hospital-specific rate 
    determinations that have been made through January 1, 1998 in the 
    provider-specific file. We used these data to determine the proposed 
    FY 1999 capital rates. However, we do not have individual hospital 
    data on old capital changes, new capital formation, and actual 
    obligated capital costs. We have data on costs for capital in use in 
    FY 1995, and we age that capital by a formula described in Appendix 
    B. Therefore, we need to randomly generate only new capital 
    acquisitions for any year after FY 1995. All Federal rate payment 
    parameters are assigned to the applicable hospital.
        For purposes of this impact analysis, the FY 1999 actuarial 
    model includes the following assumptions:
         Medicare inpatient capital costs per discharge will 
    change at the following rates during these periods:
    
            Average percentage change in capital costs per discharge        
    ------------------------------------------------------------------------
                                                                  Percentage
                            Fiscal Year                             Change  
    ------------------------------------------------------------------------
    1997.......................................................        -2.20
    1998.......................................................        -0.44
    1999.......................................................         0.61
    ------------------------------------------------------------------------
    
    We have reduced our estimate of the growth in Medicare costs per 
    discharge from the August 29, 1997 final rule with comment period to 
    this proposed rule based on later cost data. We are now estimating a 
    much smaller increase in costs per discharge.
         The Medicare case-mix index will increase by 1.0 
    percent in FY 1998 and FY 1999.
         The Federal capital rate and hospital-specific rate 
    were updated in FY 1996 by an analytical framework that considers 
    changes in the prices associated with capital-related costs, and 
    adjustments to account for forecast error, changes in the case-mix 
    index, allowable changes in intensity, and other factors. The 
    proposed FY 1999 update for inflation is 0.20 percent (see section 
    III of the Addendum).
        2. Results. We have used the actuarial model to estimate the 
    change in payment for capital-related costs from FY 1998 to FY 1999. 
    Table III shows the effect of the capital prospective payment system 
    on low capital cost hospitals and high capital cost hospitals. We 
    consider a hospital to be a low capital cost hospital if, based on a 
    comparison of its initial hospital-specific rate and the applicable 
    Federal rate, it will be paid under the fully prospective payment 
    methodology. A high capital cost hospital is a hospital that, based 
    on its initial hospital-specific rate and the applicable Federal 
    rate, will be paid under the hold-harmless payment methodology. 
    Based on our actuarial model, the breakdown of hospitals is as 
    follows:
    
                                   Capital Transition Payment Methodology for FY 1999                               
    ----------------------------------------------------------------------------------------------------------------
                                                                                             Percent of   Percent of
                          Type of hospital                         Percent of   Percent of    capital      capital  
                                                                   hospitals    discharges     costs       payments 
    ----------------------------------------------------------------------------------------------------------------
    Low Cost Hospital...........................................           67           62           53           58
    High Cost Hospital..........................................           33           38           47           42
    ----------------------------------------------------------------------------------------------------------------
    
        A low capital cost hospital may request to have its hospital-
    specific rate redetermined based on old capital costs in the current 
    year, through the later of the hospital's cost reporting period 
    beginning in FY 1994 or the first cost reporting period beginning 
    after obligated capital comes into use (within the limits 
    established in Sec. 412.302(e) for putting obligated capital in to 
    use for patient care). If the redetermined hospital-specific rate is 
    greater than the adjusted Federal rate, these hospitals will be paid 
    under the hold-harmless payment methodology. Regardless of whether 
    the hospital became a hold-harmless payment hospital as a result of 
    a redetermination, we continue to show these hospitals as low 
    capital cost hospitals in Table III.
        Assuming no behavioral changes in capital expenditures, Table III 
    displays the percentage change in payments from FY 1998 to FY 1999 
    using the above described actuarial model. With the proposed Federal 
    rate, we estimate aggregate Medicare capital payments will increase by 
    2.60 percent in FY 1999.
    
    [[Page 25692]]
    
    
    
                                          Table III.--Impact of Proposed Changes for FY 1999 on Payments per Discharge                                      
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                    Percent 
                                                       Number of                 Adjusted   Average    Hospital     Hold    Exceptions    Total      change 
                                                       hospitals   Discharges    federal    federal    specific   harmless    payment    payment    over FY 
                                                                                 payment    percent    payment    payment                             1998  
    --------------------------------------------------------------------------------------------------------------------------------------------------------
             FY 1998 Payments per Discharge:                                                                                                                
    Low Cost Hospitals...............................      3,260     6,746,172    $458.89      72.51     $86.07      $4.04       $8.87    $557.88  .........
        Fully Prospective............................      3,021     6,102,199     440.78      70.00      95.16  .........        8.21     544.15  .........
        100% Federal Rate............................        208       567,402     661.26     100.00  .........  .........       11.10     672.36  .........
        Hold Harmless................................         31        76,570     402.65      59.69  .........     355.79       45.50     803.94  .........
    High Cost Hospitals..............................      1,637     4,163,057     636.32      95.82  .........      36.64       16.72     689.68  .........
        100% Federal Rate............................      1,398     3,701,256     667.50     100.00  .........  .........       11.65     679.14  .........
        Hold Harmless................................        239       461,801     386.44      60.70  .........     330.33       57.34     774.12  .........
                                                      ------------------------------------------------------------------------------------------------------
          Total Hospitals............................      4,897    10,909,229     526.60      81.67      53.23      16.48       11.87     608.18  .........
             FY 1999 Payments per Discharge:                                                                                                                
    Low Cost Hospitals...............................      3,260     6,596,003    $529.51      81.61     $58.10      $3.38       $9.53    $597.52       7.11
        Fully Prospective............................      3,021     5,966,449     513.52      80.00      64.23  .........        8.47     586.21       7.73
        100% Federal Rate............................        211       561,909     674.19     100.00  .........  .........       10.98     685.17       1.91
        Hold Harmless................................         28        67,646     445.71      64.76  .........     329.56       91.77     867.04       7.85
    High Cost Hospitals..............................      1,637     4,068,306     655.17      97.22  .........      25.50       23.85     704.52       2.15
        100% Federal Rate............................      1,417     3,678,286     681.02     100.00  .........  .........       16.94     697.97       2.77
        Hold Harmless................................        220       390,020     411.40      67.81  .........     265.94       88.99     766.33      -1.01
                                                      ------------------------------------------------------------------------------------------------------
          Total Hospitals............................      4,897    10,664,309     575.59      87.73      35.93      11.82       15.00     638.34       4.96
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    
        We project that low capital cost hospitals paid under the fully 
    prospective payment methodology will experience an average increase 
    in payments per case of 7.73 percent, and high capital cost 
    hospitals will experience an average increase of 2.15 percent.
        For hospitals paid under the fully prospective payment 
    methodology, the Federal rate payment percentage will increase from 
    70 percent to 80 percent and the hospital-specific rate payment 
    percentage will decrease from 30 to 20 percent in FY 1999. The 
    Federal rate payment percentage for hospitals paid under the hold-
    harmless payment methodology is based on the hospital's ratio of new 
    capital costs to total capital costs. The average Federal rate 
    payment percentage for high cost hospitals receiving a hold-harmless 
    payment for old capital will increase from 60.70 percent to 67.81 
    percent. We estimate the percentage of hold-harmless hospitals paid 
    based on 100 percent of the Federal rate will increase from 85.6 
    percent to 86.8 percent. We estimate that high cost hold-harmless 
    hospitals will experience a decrease in payments of 1.01 percent 
    from FY 1998 to FY 1999. The apparent decrease occurs because we 
    estimate that there will be 19 fewer high-cost hold-harmless 
    hospitals in FY 1999. These 19 hospitals may have higher payments 
    than the remaining hospitals, hence the apparent decrease when they 
    are removed from the group. This decrease is partially offset by an 
    increase in the Federal portion of the hospital's payments and a 
    projected increase in exceptions payments.
        We expect that the average hospital-specific rate payment per 
    discharge will decrease from $95.16 in FY 1998 to $64.23 in FY 1999. 
    This is partly due to the decrease in the hospital-specific rate 
    payment percentage from 30 percent in FY 1998 to 20 percent in FY 
    1999.
        We are proposing no changes in our exceptions policies for FY 
    1999. As a result, the minimum payment levels would be:
         90 percent for sole community hospitals;
         80 percent for urban hospitals with 100 or more beds 
    and a disproportionate share patient percentage of 20.2 percent or 
    more; or
         70 percent for all other hospitals.
        We estimate that exceptions payments will increase from 1.95 
    percent of total capital payments in FY 1998 to 2.35 percent of 
    payments in FY 1999. Since the August 29, 1997 final rule with 
    comment period, we have reduced our estimates of capital cost per 
    case based on more recent data. Although we still estimate that more 
    hospitals will receive exceptions payment in FY 1999 than in FY 1998 
    fewer hospitals will have costs over the exceptions threshold then 
    we previously estimated. The projected distribution of the exception 
    payments is shown in the table below:
    
                      Estimated FY 1999 Exceptions Payments                 
    ------------------------------------------------------------------------
                                                                  Percent of
                   Type of hospital                  Number of    exceptions
                                                     hospitals     payments 
    ------------------------------------------------------------------------
    Low Capital Cost..............................          178           39
    High Capital Cost.............................          200           61
                                                   -------------------------
        Total.....................................          378          100
    ------------------------------------------------------------------------
    
    C. Cross-Sectional Comparison of Capital Prospective Payment 
    Methodologies
    
        Table IV presents a cross-sectional summary of hospital 
    groupings by capital prospective payment methodology. This 
    distribution is generated by our actuarial model.
    
      Table IV.--Distribution by Method of Payment (Hold-Harmless/Fully Prospective) of Hospitals Receiving Capital 
                                                        Payments                                                    
    ----------------------------------------------------------------------------------------------------------------
                                                                                   (2) Hold-harmless                
                                                                              --------------------------     (3)    
                                                                   (1) Total    Percentage                Percentage
                                                                     No. of     paid hold-   Percentage   paid fully
                                                                   Hospitals     harmless    paid fully  prospective
                                                                                   (A)      federal (B)      rate   
    ----------------------------------------------------------------------------------------------------------------
    By Geographic Location:                                                                                         
        All hospitals...........................................        4,897          5.1         33.2         61.7
        Large urban areas (populations over 1 million)..........        1,558          5.7         40.7         53.6
    
    [[Page 25693]]
    
                                                                                                                    
        Other urban areas (populations of 1 million or fewer)...        1,188          6.2         40.8         52.9
        Rural areas.............................................        2,151          4.0         23.7         72.4
        Urban hospitals.........................................        2,746          5.9         40.8         53.3
            0-99 beds...........................................          653          5.8         33.8         60.3
            100-199 beds........................................          928          8.5         45.9         45.6
            200-299 beds........................................          565          5.8         40.9         53.3
            300-499 beds........................................          448          2.2         40.8         56.9
            500 or more beds....................................          152          2.0         38.2         59.9
        Rural hospitals.........................................        2,151          4.0         23.7         72.4
            0-49 beds...........................................        1,124          3.5         16.1         80.4
            50-99 beds..........................................          633          4.3         28.8         67.0
            100-149 beds........................................          229          4.8         38.0         57.2
            150-199 beds........................................           91          7.7         25.3         67.0
            200 or more beds....................................           74          1.4         48.6         50.0
    By Region                                                                                                       
        Urban by Region.........................................        2,746          5.9         40.8         53.3
            New England.........................................          151          0.0         27.8         72.2
            Middle Atlantic.....................................          421          4.5         34.0         61.5
            South Atlantic......................................          409          5.4         53.5         41.1
            East North Central..................................          472          5.5         30.5         64.0
            East South Central..................................          157         10.8         48.4         40.8
            West North Central..................................          183          6.0         36.6         57.4
            West South Central..................................          332         13.3         55.7         31.0
            Mountain............................................          122          4.9         50.8         44.3
            Pacific.............................................          451          3.3         37.7         59.0
            Puerto Rico.........................................           48          6.3         22.9         70.8
        Rural by Region.........................................        2,151          4.0         23.7         72.4
            New England.........................................           53          0.0         22.6         77.4
            Middle Atlantic.....................................           79          5.1         25.3         69.6
            South Atlantic......................................          282          2.5         33.0         64.5
            East North Central..................................          283          3.2         19.1         77.7
            East South Central..................................          267          1.9         34.1         64.0
            West North Central..................................          498          3.6         16.1         80.3
            West South Central..................................          339          3.8         27.4         68.7
            Mountain............................................          205         10.7         15.6         73.7
            Pacific.............................................          140          5.0         23.6         71.4
        Large urban areas (populations over 1 million)..........        1,651          5.9         40.5         53.7
        Other urban areas (populations of 1 million or fewer)...        1,180          5.8         41.1         53.1
        Rural areas.............................................        2,066          4.0         23.0         73.0
    Teaching Status:                                                                                                
        Non-teaching............................................        3,818          5.1         32.8         62.0
        Fewer than 100 Residents................................          840          5.7         35.1         59.2
        100 or more Residents...................................          239          1.7         33.5         64.9
    Disproportionate share hospitals (DSH):                                                                         
        Non-DSH.................................................        3,029          5.3         28.9         65.8
        Urban DSH:                                                                                                  
            100 or more beds....................................        1,397          5.2         43.7         51.0
            Less than 100 beds..................................           87          1.1         29.9         69.0
        Rural DSH:                                                                                                  
            Sole Community (SCH/EACH)...........................          156          5.1         22.4         72.4
            Referral Center (RRC/EACH)..........................           47          2.1         53.2         44.7
            Other Rural:                                                                                            
                100 or more beds................................           64          4.7         37.5         57.8
                Less than 100 beds..............................          117          0.9         28.2         70.9
    Urban teaching and DSH:                                                                                         
        Both teaching and DSH...................................          699          4.0         36.6         59.4
        Teaching and no DSH.....................................          327          6.7         31.5         61.8
        No teaching and DSH.....................................          785          5.9         48.5         45.6
        No teaching and no DSH..................................        1,020          6.8         40.5         52.7
    Rural Hospital Types:                                                                                           
        Non special status hospitals............................          894          2.0         24.0         73.9
        RRC/EACH................................................          137          2.2         40.1         57.7
        SCH/EACH................................................          632          8.2         19.9         71.8
        Medicare-dependent hospitals (MDH)......................          349          1.1         17.5         81.4
        SCH, RRC and EACH.......................................           54         11.1         33.3         55.6
    
    [[Page 25694]]
    
                                                                                                                    
    Type of Ownership:                                                                                              
        Voluntary...............................................        2,847          4.9         33.0         62.1
        Proprietary.............................................          656         10.1         58.2         31.7
        Government..............................................        1,329          3.2         21.1         75.7
    Medicare Utilization as a Percent of Inpatient Days:                                                            
        0-25....................................................          238          4.2         30.7         65.1
        25-50...................................................        1,260          5.9         41.0         53.2
        50-65...................................................        1,970          5.6         33.0         61.4
        Over 65.................................................        1,364          3.8         26.6         69.6
    ----------------------------------------------------------------------------------------------------------------
    
        As we explain in Appendix B, we were not able to determine a 
    hospital-specific rate for 59 of the 4,956 hospitals in our 
    database. Consequently, the payment methodology distribution is 
    based on 4,897 hospitals. These data should be fully representative 
    of the payment methodologies that will be applicable to hospitals.
        The cross-sectional distribution of hospital by payment 
    methodology is presented by: (1) Geographic location, (2) region, 
    and (3) payment classification. This provides an indication of the 
    percentage of hospitals within a particular hospital grouping that 
    will be paid under the fully prospective payment methodology and the 
    hold-harmless payment methodology.
        The percentage of hospitals paid fully Federal (100 percent of 
    the Federal rate) as hold-harmless hospitals is expected to increase 
    to 33.2 percent in FY 1999. We note that the number of hospitals 
    paid fully Federal as hold-harmless hospitals has not increased as 
    quickly as we predicted in the August 29, 1997 final rule with 
    comment period because of revised estimates.
        Table IV indicates that 61.7 percent of hospitals will be paid 
    under the fully prospective payment methodology. (This figure, 
    unlike the figure of 67 percent for low cost capital hospitals in 
    the previous section, takes account of the effects of 
    redeterminations. In other words, this figure does not include low 
    cost hospitals that, following a hospital-specific rate 
    redetermination, are now paid under the hold-harmless methodology.) 
    As expected, a relatively higher percentage of rural and 
    governmental hospitals (73.0 percent and 75.7 percent, respectively 
    by payment classification) are being paid under the fully 
    prospective methodology. This is a reflection of their lower than 
    average capital costs per case. In contrast, only 31.7 percent of 
    proprietary hospitals are being paid under the fully prospective 
    methodology. This is a reflection of their higher than average 
    capital costs per case. (We found at the time of the August 30, 1991 
    final rule (56 FR 43430) that 62.7 percent of proprietary hospitals 
    had a capital cost per case above the national average cost per 
    case.)
    
    D. Cross-Sectional Analysis of Changes in Aggregate Payments
    
        We used our FY 1999 actuarial model to estimate the potential 
    impact of our proposed changes for FY 1999 on total capital payments 
    per case, using a universe of 4,897 hospitals. The individual 
    hospital payment parameters are taken from the best available data, 
    including: The January 1, 1998 update to the provider-specific file, 
    cost report data, and audit information supplied by intermediaries. 
    In Table V we present the results of the cross-sectional analysis 
    using the results of our actuarial model and the aggregate impact of 
    the FY 1999 payment policies. Columns 3 and 4 show estimates of 
    payments per case under our model for FY 1998 and FY 1999. Column 5 
    shows the total percentage change in payments from FY 1998 to FY 
    1999. Column 6 presents the percentage change in payments that can 
    be attributed to Federal rate changes alone.
        Federal rate changes represented in Column 6 include the 1.5 
    percent increase in the Federal rate, a 1.0 percent increase in case 
    mix, changes in the adjustments to the Federal rate (for example, 
    the effect of the new hospital wage index on the geographic 
    adjustment factor), and reclassifications by the MGCRB. Column 5 
    includes the effects of the Federal rate changes represented in 
    Column 6. Column 5 also reflects the effects of all other changes, 
    including: the change from 70 percent to 80 percent in the portion 
    of the Federal rate for fully prospective hospitals, the hospital-
    specific rate update, changes in the proportion of new to total 
    capital for hold-harmless hospitals, changes in old capital (for 
    example, obligated capital put in use), hospital-specific rate 
    redeterminations, and exceptions. The comparisons are provided by: 
    (1) Geographic location, (2) region, and (3) payment classification.
        The simulation results show that, on average, capital payments 
    per case can be expected to increase 5.0 percent in FY 1999. The 
    results show that the effect of the Federal rate changes alone is to 
    increase payments by 1.5 percent. In addition to the increase 
    attributable to the Federal rate changes, a 3.5 percent increase is 
    attributable to the effects of all other changes.
        Our comparison by geographic location shows that urban and rural 
    hospitals will experience slightly different rates of increase in 
    capital payments per case (4.8 percent and 6.3 percent, 
    respectively). This difference is due to the lower rate of increase 
    for urban hospitals relative to rural hospitals (1.3 percent and 3.2 
    percent, respectively) from the Federal rate changes alone. Urban 
    hospitals will gain approximately the same as rural hospitals (3.5 
    percent versus 3.1 percent) from the effects of all other changes.
        All regions are estimated to receive increases in total capital 
    payments per case, partly due to the increased share of payments 
    that are based on the Federal rate (from 70 to 80 percent). Changes 
    by region vary from a low of 3.6 percent increase (West South 
    Central urban region) to a high of 7.8 percent increase (Pacific 
    rural region).
        By type of ownership, government hospitals are projected to have 
    the largest rate of increase (6.2 percent, 1.9 percent due to 
    Federal rate changes and 4.3 percent from the effects of all other 
    changes). Payments to voluntary hospitals will increase 5.1 percent 
    (a 1.5 percent increase due to Federal rate changes and a 3.6 
    percent increase from the effects of all other changes) and payments 
    to proprietary hospitals will increase 2.8 percent (a 1.1 percent 
    increase due to Federal rate changes and a 1.7 percent increase from 
    the effects of all other changes).
        Section 1886(d)(10) of the Act established the MGCRB. Hospitals 
    may apply for reclassification for purposes of the standardized 
    amount, wage index, or both and for purposes of DSH, for FY 1999-
    2001. Although the Federal capital rate is not affected, a 
    hospital's geographic classification for purposes of the operating 
    standardized amount does affect a hospital's capital payments as a 
    result of the large urban adjustment factor and the disproportionate 
    share adjustment for urban hospitals with 100 or more beds. 
    Reclassification for wage index purposes affects the geographic 
    adjustment factor since that factor is constructed from the hospital 
    wage index.
        To present the effects of the hospitals being reclassified for 
    FY 1999 compared to the effects of reclassification for FY 1998, we 
    show the average payment percentage increase for hospitals 
    reclassified in each
    
    [[Page 25695]]
    
    fiscal year and in total. For FY 1999 reclassifications, we indicate 
    those hospitals reclassified for standardized amount purposes only, 
    for wage index purposes only, and for both purposes. The 
    reclassified groups are compared to all other nonreclassified 
    hospitals. These categories are further identified by urban and 
    rural designation.
        Hospitals reclassified for FY 1999 as a whole are projected to 
    experience a 6.8 percent increase in payments (a 3.5 percent 
    increase attributable to Federal rate changes and a 3.3 percent 
    increase attributable to the effects of all other changes). Payments 
    to nonreclassified hospitals will increase slightly less (5.1 
    percent) than reclassified hospitals (6.8 percent) overall. Payments 
    to nonreclassified hospitals will increase less than reclassified 
    hospitals from the Federal rate changes (1.5 percent compared to 3.5 
    percent), but they will gain about the same from the effects of all 
    other changes (3.6 percent compared to 3.3 percent).
    
                      Table V.--Comparison of Total Payments Per Case (FY 1998 Compared to FY 1999)                 
    ----------------------------------------------------------------------------------------------------------------
                                                                                                           Portion  
                                                     Number of    Average FY   Average FY               attributable
                                                     hospitals    1998 pay-    1999 pay-   All changes   to federal 
                                                                  ments/case   ments/case                rate change
    ----------------------------------------------------------------------------------------------------------------
    By Geographic Location:                                                                                         
        All hospitals.............................        4,897          608          638          5.0           1.5
        Large urban areas (populations over 1                                                                       
         million).................................        1,558          700          732          4.5           1.1
        Other urban areas (populations of 1                                                                         
         million of fewer)........................        1,188          601          633          5.2           1.5
        Rural areas...............................        2,151          405          431          6.3           3.2
        Urban hospitals...........................        2,746          658          689          4.8           1.3
            0-99 beds.............................          653          482          502          4.1           1.2
            100-199 beds..........................          928          584          605          3.6           1.1
            200-299 beds..........................          565          628          661          5.4           1.3
            300-499 beds..........................          448          686          720          4.9           1.2
            500 or more beds......................          152          824          866          5.1           1.4
        Rural hospitals...........................        2,151          405          431          6.3           3.2
            0-49 beds.............................        1,124          325          348          6.9           2.9
            50-99 beds............................          633          382          407          6.6           2.8
            100-149 beds..........................          229          421          446          5.9           3.0
            150-199 beds..........................           91          442          469          6.0           3.8
            200 or more beds......................           74          500          531          6.2           3.7
    By Region:                                                                                                      
        Urban by Region...........................        2,746          658          689          4.8           1.3
            New England...........................          151          659          685          4.0          -0.4
            Middle Atlantic.......................          421          708          743          5.0           1.8
            South Atlantic........................          409          649          678          4.4           1.8
            East North Central....................          472          616          650          5.5           1.0
            East South Central....................          157          611          633          3.6           0.8
            West North Central....................          183          638          673          5.6           2.3
            West South Central....................          332          664          688          3.6           0.5
            Mountain..............................          122          691          728          5.4           1.6
            Pacific...............................          451          719          755          5.1           1.0
            Puerto Rico...........................           48          277          288          4.1           1.9
        Rural by Region...........................        2,151          405          431          6.3           3.2
            New England...........................           53          475          497          4.5           1.9
            Middle Atlantic.......................           79          413          443          7.4           3.4
            South Atlantic........................          282          430          455          5.9           3.5
            East North Central....................          283          401          431          7.4           3.4
            East South Central....................          267          376          400          6.6           3.4
            West North Central....................          498          390          411          5.6           3.4
            West South Central....................          339          370          390          5.5           2.5
            Mountain..............................          205          434          461          6.4           2.4
            Pacific...............................          140          478          515          7.8           2.8
    By Payment Classification:                                                                                      
        All hospitals.............................        4,897          608          638          5.0           1.5
        Large urban areas (populations over 1                                                                       
         million).................................        1,651          692          724          4.5           1.1
        Other urban areas (populations of 1                                                                         
         million of fewer)........................        1,180          599          631          5.2           1.5
        Rural areas...............................        2,066          402          427          6.2           3.0
        Teaching Status:                                                                                            
            Non-teaching..........................        3,818          517          540          4.5           1.7
            Fewer than 100 Residents..............          840          647          682          5.4           1.3
            100 or more Residents.................          239          889          936          5.3           1.3
            Urban DSH:                                                                                              
                100 or more beds..................        1,397          693          727          4.9           1.3
                Less than 100 beds................           87          444          467          5.1           1.1
            Rural DSH:                                                                                              
                Sole Community (SCH/EACH).........          156          364          383          5.2           2.5
                Referral Center (RRC/EACH)........           47          462          494          7.0           4.5
                Other Rural:                                                                                        
                100 or more beds..................           64          384          400          4.3           2.8
                Less than 100 beds................          117          320          340          6.3           3.3
        Urban teaching and DSH:                                                                                     
            Both teaching and DSH.................          699          761          801          5.3           1.2
            Teaching and no DSH...................          327          659          696          5.5           1.3
    
    [[Page 25696]]
    
                                                                                                                    
            No teaching and DSH...................          785          585          610          4.3           1.3
            No teaching and no DSH................        1,020          558          579          3.7           1.3
        Rural Hospital Types:                                                                                       
            Non special status hospitals..........          894          367          389          6.0           2.6
            RRC/EACH..............................          137          475          506          6.5           3.9
            SCH/EACH..............................          632          391          416          6.2           2.4
            Medicare-dependent hospitals (MDH)....          349          324          355          9.5           3.6
            SCH, RRC and EACH.....................           54          483          500          3.5           3.1
        Hospitals Reclassified by the Medicare                                                                      
         Geographic Classification Review Board:                                                                    
            Reclassification Status During FY98                                                                     
             and FY99:                                                                                              
                Reclassified During Both FY98 and                                                                   
                 FY99.............................          311          540          566          4.8           1.7
            Reclassified During FY99 Only.........          178          487          537         10.4           6.8
            Reclassified During FY98 Only.........          110          580          587          1.2          -1.4
            FY99 Reclassifications:                                                                                 
                All Reclassified Hospitals........          489          520          555          6.8           3.5
                All Nonreclassified Hospitals.....        4,449          614          646          5.1           1.5
                All Urban Reclassified Hospitals..           95          663          708          6.8           2.3
                Urban Nonreclassified Hospitals...        2,624          659          689          4.7           1.2
                All Reclassified Rural Hospitals..          394          462          494          6.8           4.2
                Rural Nonreclassified Hospitals...        1,757          369          391          6.0           2.4
            Other Reclassified Hospitals (Section                                                                   
             1886 (D)(8)(B))......................           27          461          476          3.3           1.1
        Type of Ownership:                                                                                          
            Voluntary.............................        2,847          622          653          5.1           1.5
            Proprietary...........................          656          617          634          2.8           1.1
            Government............................        1,329          530          563          6.2           1.9
        Medicare Utilization as a Percent of                                                                        
         Inpatient Days:                                                                                            
            0-25..................................          238          685          725          5.8           1.1
            25-50.................................        1,260          724          759          4.7           1.3
            50-65.................................        1,970          565          594          5.2           1.6
    ----------------------------------------------------------------------------------------------------------------
    
    Appendix B: Technical Appendix on the Capital Cost Model and Required 
    Adjustments
    
        Under section 1886(g)(1)(A) of the Act, we set capital 
    prospective payment rates for FY 1992 through FY 1995 so that 
    aggregate prospective payments for capital costs were projected to 
    be 10 percent lower than the amount that would have been payable on 
    a reasonable cost basis for capital-related costs in that year. To 
    implement this requirement, we developed the capital acquisition 
    model to determine the budget neutrality adjustment factor. Even 
    though the budget neutrality requirement expired effective with FY 
    1996, we must continue to determine the recalibration and geographic 
    reclassification budget neutrality adjustment factor, and the 
    reduction in the Federal and hospital-specific rates for exceptions 
    payments. To determine these factors, we must continue to project 
    capital costs and payments.
        We have used the capital acquisition model since the start of 
    prospective payments for capital costs. We now have 4 years of cost 
    reports under the capital prospective payment system. For FY 1998, 
    we developed a new capital cost model to replace the capital 
    acquisition model. This revised model makes use of the data from 
    these cost reports.
        The following cost reports are used in the capital cost model 
    for this proposed rule: The December 31, 1997 update of the cost 
    reports for PPS-IX (cost reporting periods beginning in FY 1992), 
    PPS-X (cost reporting periods beginning in FY 1993), PPS-XI (cost 
    reporting periods beginning in FY 1994), and PPS-XII (cost reporting 
    periods beginning in FY 1995). In addition, to model payments, we 
    use the January 1, 1998 update of the provider-specific file, and 
    the March 1994 update of the intermediary audit file.
        Since hospitals under alternative payment system waivers (that 
    is, hospitals in Maryland) are currently excluded from the capital 
    prospective payment system, we excluded these hospitals from our 
    model.
        We developed FY 1992 through FY 1998 hospital-specific rates 
    using the provider-specific file and the intermediary audit file. 
    (We used the cumulative provider-specific file, which includes all 
    updates to each hospital's records, and chose the latest record for 
    each fiscal year.) We checked the consistency between the provider-
    specific file and the intermediary audit file. We ensured that 
    increases in the hospital-specific rates were at least as large as 
    the published updates (increases) for the hospital-specific rates 
    each year. We were able to match hospitals to the files as shown in 
    the following table:
    
    ------------------------------------------------------------------------
                                                                  Number of 
                               Source                             hospitals 
    ------------------------------------------------------------------------
    Provider-Specific File Only................................           99
    Provider-Specific and Audit File...........................         4857
                                                                ------------
        Total..................................................         4956
    ------------------------------------------------------------------------
    
        Eighty-six of the 4,956 hospitals had unusable or missing data 
    or had no cost reports available. We determined from the cost 
    reports that 27 of the 86 hospitals were paid under the hold-
    harmless methodology. Since the hospital-specific amount is not used 
    to determine payments for these hospitals, we were able to include 
    these 27 hospitals in the analysis. We used the cost report data of 
    4,897 hospitals for the analysis. Fifty-nine hospitals could not be 
    used in the analysis because of insufficient information. These 
    hospitals account for approximately 0.3 percent of admissions, 
    therefore, any effects from the elimination of their cost report 
    data should be minimal.
        We analyzed changes in capital-related costs (depreciation, 
    interest, rent, leases, insurance, and taxes) reported in the cost 
    reports. We found a wide variance among hospitals in the growth of 
    these costs. For hospitals with more than 100 beds, the distribution 
    and mean of these cost increases were different for large changes in 
    bed-size (greater than 20 percent). We also analyzed 
    changes in the growth in old capital and new capital for cost 
    reports that provided this information. For old capital, we limited 
    the analysis to decreases in old capital. We did this since the 
    opportunity for most hospitals to treat ``obligated'' capital put 
    into service as
    
    [[Page 25697]]
    
    old capital has expired. Old capital costs should, therefore, 
    decrease as assets become fully depreciated, and as interest costs 
    decrease as the loan is amortized.
        The new capital cost model separates the hospitals into three 
    mutually exclusive groups. Hold-harmless hospitals with data on old 
    capital were placed in the first group. Of the remaining hospitals, 
    those hospitals with fewer than 100 beds comprise the second group. 
    The third group consists of all hospitals that did not fit into 
    either of the groups. Each of these groups displayed unique patterns 
    of growth in capital costs. We found that the gamma distribution is 
    useful in explaining and describing the patterns of increase in 
    capital costs. A gamma distribution is a statistical distribution 
    that can be used to describe patterns of growth rates, with greatest 
    proportion of rates being at the low end. We use the gamma 
    distribution to estimate individual hospital rates of increase as 
    follows:
        (1) For hold-harmless hospitals, old capital cost changes were 
    fitted to a truncated gamma distribution, that is, a gamma 
    distribution covering only the distribution of cost decreases. New 
    capital costs changes were fitted to the entire gamma distribution 
    allowing for both decreases and increases.
        (2) For hospitals with fewer than 100 beds (small), total 
    capital cost changes were fitted to the gamma distribution allowing 
    for both decreases and increases.
        (3) Other (large) hospitals were further separated into three 
    groups:
         Bed-size decreases over 20 percent (decrease).
         Bed-size increases over 20 percent (increase).
         Other (no-change).
        Capital cost changes for large hospitals were fitted to gamma 
    distributions for each bed-size change group, allowing for both 
    decreases and increases in capital costs. We analyzed the 
    probability distribution of increases and decreases in bed-size for 
    large hospitals. We found the probability somewhat dependent on the 
    prior year change in bed-size and factored this dependence into the 
    analysis. Probabilities of bed-size change were determined. Separate 
    sets of probability factors were calculated to reflect the 
    dependence on prior year change in bed-size (increase, decrease, and 
    no change).
        The gamma distributions were fitted to changes in aggregate 
    capital costs for the entire hospital. We checked the relationship 
    between aggregate costs and Medicare per discharge costs. For large 
    hospitals, there was a small variance, but the variance was larger 
    for small hospitals. Since costs are used only for the hold-harmless 
    methodology and to determine exceptions, we decided to use the gamma 
    distributions fitted to aggregate cost increases for estimating 
    distributions of cost per discharge increases.
        Capital costs per discharge calculated from the cost reports 
    were increased by random numbers drawn from the gamma distribution 
    to project costs in future years. Old and new capital were projected 
    separately for hold-harmless hospitals. Aggregate capital per 
    discharge costs were projected for all other hospitals. Because the 
    distribution of increases in capital costs varies with changes in 
    bed-size for large hospitals, we first projected changes in bed-size 
    for large hospitals before drawing random numbers from the gamma 
    distribution. Bed-size changes were drawn from the uniform 
    distribution with the probabilities dependent on the previous year 
    bed-size change. The gamma distribution has a shape parameter and a 
    scaling parameter. (We used different parameters for each hospital 
    group, and for old and new capital.)
        We used discharge counts from the cost reports to calculate 
    capital cost per discharge. To estimate total capital costs for FY 
    1997 (the MedPAR data year) and later, we use the number of 
    discharges from the MEDPAR data. Some hospitals have considerably 
    more discharges in FY 1997 than in the years for which we calculated 
    cost per discharge from the cost report data. Consequently, a 
    hospital with few cost report discharges would have a high capital 
    cost per discharge since fixed costs would be allocated over only a 
    few discharges. If discharges increase substantially, the cost per 
    discharge would decrease because fixed costs would be allocated over 
    more discharges. If the projection of capital cost per discharge is 
    not adjusted for increases in discharges, the projection of 
    exceptions would be overstated. We address this situation by 
    recalculating the cost per discharge with the MedPAR discharges if 
    the MedPAR discharges exceed the cost report discharges by more than 
    20 percent. We do not adjust for increases of less than 20 percent 
    because we have not received all of the FY 1997 discharges, and we 
    have removed some discharges from the analysis because they are 
    statistical outliers. This adjustment reduces our estimate of 
    exceptions payments, and consequently, the reduction to the Federal 
    rate for exceptions is smaller. We will continue to monitor our 
    modeling of exceptions payments and make adjustments as needed.
        The average national capital cost per discharge generated by 
    this model is the combined average of many randomly generated 
    increases. This average must equal the projected average national 
    capital cost per discharge, which we projected separately (outside 
    this model). We adjusted the shape parameter of the gamma 
    distributions so that the modeled average capital cost per discharge 
    matches our projected capital cost per discharge. The shape 
    parameter for old capital was not adjusted since we are modeling the 
    aging of ``existing'' assets. This model provides a distribution of 
    capital costs among hospitals that is consistent with our aggregate 
    capital projections.
        Once each hospital's capital-related costs are generated, the 
    model projects capital payments. We use the actual payment 
    parameters (for example, the case-mix index and the geographic 
    adjustment factor) that are applicable to the specific hospital.
        To project capital payments, the model first assigns the 
    applicable payment methodology (fully prospective or hold-harmless) 
    to the hospital as determined from the provider-specific file and 
    the cost reports. The model simulates Federal rate payments using 
    the assigned payment parameters and hospital-specific estimated 
    outlier payments. The case-mix index for a hospital is derived from 
    the FY 1997 MedPAR file using the FY 1998 DRG relative weights 
    published in section V. of the Addendum to this proposed rule. The 
    case-mix index is increased each year after FY 1997 based on 
    analysis of past experiences in case-mix increases. Based on 
    analysis of recent case-mix increases, we estimate that case-mix 
    will increase 1.0 percent in FY 1998 and 1.0 percent in FY 1999. 
    (Since we are using FY 1997 cases for our analysis, the FY 1997 
    increase in case mix has no effect on projected capital payments.)
        Changes in geographic classification and revisions to the 
    hospital wage data used to establish the hospital wage index affect 
    the geographic adjustment factor. Changes in the DRG classification 
    system and the relative weights affect the case-mix index.
        Section 412.308(c)(4)(ii) requires that the estimated aggregate 
    payments for the fiscal year, based on the Federal rate after any 
    changes resulting from DRG reclassifications and recalibration and 
    the geographic adjustment factor, equal the estimated aggregate 
    payments based on the Federal rate that would have been made without 
    such changes. For FY 1998, the budget neutrality adjustment factor 
    was 1.00015.
        Since we implemented a separate geographic adjustment factor for 
    Puerto Rico, we propose to apply separate budget neutrality 
    adjustments for the national geographic adjustment factor and the 
    Puerto Rico geographic adjustment factor. We propose to apply the 
    same budget neutrality factor for DRG reclassifications and 
    recalibration nationally and for Puerto Rico. Separate adjustments 
    were unnecessary for FY 1998 since the geographic adjustment factor 
    for Puerto Rico was implemented in 1998.
        To determine the factors for FY 1999, we first determined the 
    portions of the Federal national and Puerto Rico rates that would be 
    paid for each hospital in FY 1999 based on its applicable payment 
    methodology. Using our model, we then compared, separately for the 
    national rate and the Puerto Rico rate, estimated aggregate Federal 
    rate payments based on the FY 1998 DRG relative weights and the FY 
    1998 geographic adjustment factor to estimated aggregate Federal 
    rate payments based on the FY 1998 relative weights and the FY 1999 
    geographic adjustment factor. In making the comparison, we held the 
    FY 1999 Federal rate portion constant and set the other budget 
    neutrality adjustment factor and the exceptions reduction factor to 
    1.00. We determined that, to achieve budget neutrality for the 
    changes in the national geographic adjustment factor, an incremental 
    budget neutrality adjustment of 0.99995 for FY 1999 should be 
    applied to the previous cumulative FY 1998 adjustment of 1.00015, 
    yielding a cumulative adjustment of 1.00010 through FY 1999. Since 
    this is the first adjustment for Puerto Rico, the incremental and 
    cumulative adjustment for Puerto Rico would be 0.99887 through 1999. 
    We apply these new adjustments then compare estimated aggregate 
    Federal rate payments based on the FY 1998 DRG relative weights and 
    the FY 1999 geographic adjustment factors to estimated aggregate
    
    [[Page 25698]]
    
    Federal rate payments based on the FY 1999 DRG relative weights and 
    the FY 1999 geographic adjustment factors. The incremental 
    adjustment for DRG classifications and changes in relative weights 
    would be 1.00328 nationally and for Puerto Rico. The cumulative 
    adjustments for DRG classifications and changes in relative weights 
    and for changes in the geographic adjustment factors through 1999 
    would be 1.00338 nationally, and 1.00215 for Puerto Rico. The 
    following table summarizes the adjustment factors for each fiscal 
    year:
    
                         Budget Neutrality Adjustment for DRG Reclassifications and Recalibration and the Geographic Adjustment Factors                     
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  National                                                 Puerto Rico                      
                                         -------------------------------------------------------------------------------------------------------------------
                                                     Incremental Adjustment                                    Incremental Adjustment                       
                 Fiscal year             ---------------------------------------------             ---------------------------------------------            
                                           Geographic         DRG                       Cumulative   Geographic         DRG                       Cumulative
                                           Adjustment  Reclassifications    Combined                 Adjustment  Reclassifications    Combined              
                                             Factor    and Recalibration                               Factor    and Recalibration                          
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    1992................................  ...........  .................  ...........     1,000.00  ...........  .................  ...........  ...........
    1993................................  ...........  .................     0.998.00     0.998.00  ...........  .................  ...........  ...........
    1994................................  ...........  .................      1.00531      1.00330  ...........  .................  ...........  ...........
    1995................................  ...........  .................      0.99980      1.00310  ...........  .................  ...........  ...........
    1996................................  ...........  .................      0.99940      1.00250  ...........  .................  ...........  ...........
    1997................................  ...........  .................      0.99873      1.00123  ...........  .................  ...........  ...........
    1998................................  ...........  .................      0.99892      1.00015  ...........  .................  ...........      1.00000
    1999................................      0.99995         1.00328         1.00323      1.00338      0.99887         1.00328         1.00215      1.00215
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    
        The methodology used to determine the recalibration and 
    geographic (DRG/GAF) budget neutrality adjustment factor is similar 
    to that used in establishing budget neutrality adjustments under the 
    prospective payment system for operating costs. One difference is 
    that, under the operating prospective payment system, the budget 
    neutrality adjustments for the effect of geographic 
    reclassifications are determined separately from the effects of 
    other changes in the hospital wage index and the DRG relative 
    weights. Under the capital prospective payment system, there is a 
    single DRG/GAF budget neutrality adjustment factor (the national 
    rate and the Puerto Rico rate are determined separately) for changes 
    in the geographic adjustment factor (including geographic 
    reclassification) and the DRG relative weights. In addition, there 
    is no adjustment for the effects that geographic reclassification 
    has on the other payment parameters, such as the payments for 
    serving low-income patients or the large urban add-on payments.
        In addition to computing the DRG/GAF budget neutrality 
    adjustment factor, we used the model to simulate total payments 
    under the prospective payment system.
        Additional payments under the exceptions process are accounted 
    for through a reduction in the Federal and hospital-specific rates. 
    Therefore, we used the model to calculate the exceptions reduction 
    factor. This exceptions reduction factor ensures that aggregate 
    payments under the capital prospective payment system, including 
    exceptions payments, are projected to equal the aggregate payments 
    that would have been made under the capital prospective payment 
    system without an exceptions process. Since changes in the level of 
    the payment rates change the level of payments under the exceptions 
    process, the exceptions reduction factor must be determined through 
    iteration.
        In the August 30, 1991 final rule (56 FR 43517), we indicated 
    that we would publish each year the estimated payment factors 
    generated by the model to determine payments for the next 5 years. 
    The table below provides the actual factors for fiscal years 1992 
    through 1998, the proposed factors for fiscal year 1999, and the 
    estimated factors that would be applicable through FY 2003. We 
    caution that these are estimates for fiscal years 2000 and later, 
    and are subject to revisions resulting from continued methodological 
    refinements, receipt of additional data, and changes in payment 
    policy changes. We note that in making these projections, we have 
    assumed that the cumulative national DRG/GAF budget neutrality 
    adjustment factor will remain at 1.00338 (1.00215 for Puerto Rico) 
    for FY 1999 and later because we do not have sufficient information 
    to estimate the change that will occur in the factor for years after 
    FY 1999.
        The projections are as follows:
    
    [[Page 25699]]
    
    
    
    --------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                   Federal  
                                                                 Update     Exceptions     Budget         DRG/GAF        Outlier      Federal    rate (after
                           Fiscal year                           factor     reduction    neutrality     adjustment      adjustment      rate       outlier  
                                                                              factor       factor       factor \1\        factor     adjustment   reduction)
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    1992....................................................          N/A       0.9813       0.9602  ................        .9497  ...........       415.59
    1993....................................................         6.07        .9756        .9162             .9980        .9496  ...........       417.29
    1994....................................................         3.04        .9485        .8947            1.0053        .9454     \2\.9260       378.34
    1995....................................................         3.44        .9734        .8432             .9998        .9414  ...........       376.83
    1996....................................................         1.20        .9849          N/A             .9994        .9536     \3\.9972       461.96
    1997....................................................         0.70        .9358          N/A             .9987        .9481  ...........       438.92
    1998....................................................         0.90        .9659          N/A             .9989        .9382     \4\.8222       371.51
    1999....................................................         0.20        .9761          N/A            1.0032        .9378  ...........       377.25
    2000....................................................         0.80        .9749          N/A        \5\ 1.0000     \5\.9378  ...........       379.80
    2001....................................................         0.80        .9720          N/A            1.0000        .9378  ...........       381.70
    2002....................................................         0.90   \6\ 1.0000          N/A            1.0000        .9378  ...........       396.23
    2003....................................................         0.90   \6\ 1.0000          N/A            1.0000        .9378   \4\ 1.0255      410.01 
    --------------------------------------------------------------------------------------------------------------------------------------------------------
    \1\ Note: The incremental change over the previous year.                                                                                                
    \2\ Note: OBRA 1993 adjustment.                                                                                                                         
    \3\ Note: Adjustment for change in the transfer policy.                                                                                                 
    \4\ Note: Balanced Budget Act of 1997 adjustment.                                                                                                       
    \5\ Note: Future adjustments are, for purposes of this projection, assumed to remain at the same level.                                                 
    \6\ Note: We are unable to estimate exceptions payments for the year under the special exceptions provision (Sec.  412.348(g) of the regulations)       
      because the regular exceptions provision (Sec.  412.348(e)) expires.                                                                                  
    
    
    BILLING CODE 4120-03-U
    
    [[Page 25700]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.026
    
    
    [[Page 25701]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.027
    
    
    
    [[Page 25702]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.028
    
    
    
    [[Page 25703]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.029
    
    
    
    BILLING CODE 4120-03-C
    
    [[Page 25704]]
    
    Appendix D: Recommendation of Update Factors for Operating Cost Rates 
    of Payment for Inpatient Hospital Services
    
    I. Background
    
        Several provisions of the Act address the setting of update 
    factors for inpatient services furnished in FY 1999 by hospitals 
    subject to the prospective payment system and those excluded from 
    the prospective payment system. Section 1886(b)(3)(B)(i)(XIV) of the 
    Act sets the FY 1999 percentage increase in the operating cost 
    standardized amounts equal to the rate of increase in the hospital 
    market basket minus 1.9 percent for prospective payment hospitals in 
    all areas. Section 1886(b)(3)(B)(iv) of the Act sets the FY 1999 
    percentage increase in the hospital-specific rates applicable to 
    sole community and Medicare-dependent, small rural hospitals equal 
    to the rate set forth in section 1886(b)(3)(B)(i) of the Act, that 
    is, the same update factor as all other hospitals subject to the 
    prospective payment system, or the rate of increase in the market 
    basket minus 1.9 percentage points. (We note that, as provided in 
    section 4401(b) of the Balanced Budget Act of 1997, certain 
    hospitals that do not receive indirect medical education or 
    disproportionate share payments and are not designated as Medicare-
    dependent, small rural hospitals will receive an update that is 0.3 
    percent higher than the update for other prospective payment 
    hospitals. Section 1886(b)(3)(B)(ii) of the Act sets the FY 1999 
    percentage increase in the rate of increase limits for hospitals 
    excluded from the prospective payment system equal to the rate of 
    increase in the excluded hospital market basket minus a percentage 
    between 0 and 2.5 percent percentage points, depending on the 
    hospital's costs in relation to its limit.
        In accordance with section 1886(d)(3)(A) of the Act, we are 
    proposing to update the standardized amounts, the hospital-specific 
    rates, and the rate-of-increase limits for hospitals excluded from 
    the prospective payment system as provided in section 1886(b)(3)(B) 
    of the Act. Based on the fourth quarter 1997 forecast of the FY 1999 
    market basket increase of 2.6 percent for hospitals subject to the 
    prospective payment system, the proposed updates to the standardized 
    amounts are 0.7 percent (that is, the market basket rate of increase 
    minus 1.9 percent) for hospitals in both large urban and other 
    areas. The proposed update to the hospital-specific rate applicable 
    to sole community and Medicare-dependent, small rural hospitals is 
    also 0.7 percent. The proposed update for hospitals excluded from 
    the prospective payment system is the percentage increase in the 
    excluded hospital market basket (currently estimated at 2.5 percent) 
    less a percentage between 0 and 2.5 percentage points, or an update 
    equal to between 0 and 2.5 percent.
        Section 1886(e)(4) of the Act requires that the Secretary, 
    taking into consideration the recommendations of the Medicare 
    Payment Advisory Commission (MedPAC), recommend update factors for 
    each fiscal year that take into account the amounts necessary for 
    the efficient and effective delivery of medically appropriate and 
    necessary care of high quality. Under section 1886(e)(5) of the Act, 
    we are required to publish the update factors recommended under 
    section 1886(e)(4) of the Act. Accordingly, this appendix provides 
    the recommendations of appropriate update factors, the analysis 
    underlying our recommendations, and our responses to the MedPAC 
    recommendations concerning the update factors.
        In its March 1, 1998 report, MedPAC stated that the legislated 
    update of market basket increase minus 1.9 percentage points will 
    provide a reasonable level of payment to hospitals. Although MedPAC 
    suggests that a somewhat lower update could be justified in light of 
    changes in the utilization and provision of hospital inpatient care, 
    the Commission does not believe it is necessary to recommend a lower 
    update for FY 1999. MedPAC did not make a separate recommendation 
    for the hospital-specific rates applicable to sole community and 
    Medicare-dependent, small rural hospitals. We discuss MedPAC's 
    recommendations concerning the update factors and our responses to 
    these recommendations below.
    
    II. Secretary's Recommendations
    
        Under section 1886(e)(4) of the Act, we are recommending that an 
    appropriate update factor for the standardized amounts is 0.7 
    percent for hospitals located in large urban and other areas. We are 
    also recommending an update of 0.7 percent to the hospital-specific 
    rate for sole community hospitals and Medicare-dependent, small 
    rural hospitals. These figures are consistent with the President's 
    FY 1999 budget recommendations, which reflect the update provided by 
    section 4401(a) of the Balanced Budget Act of 1997. We believe these 
    recommended update factors would ensure that Medicare acts as a 
    prudent purchaser and provide incentives to hospitals for increased 
    efficiency, thereby contributing to the solvency of the Medicare 
    Part A Trust Fund. When the President's budget was submitted, the 
    market basket rate of increase was projected at 2.7 percent. As 
    noted above, this proposed recommendation is based on the most 
    recent forecast of the market basket, 2.6 percent.
        We recommend that hospitals excluded from the prospective 
    payment system receive an update of between 0 and 2.5 percent. The 
    update for excluded hospitals and units is equal to the increase in 
    the excluded hospital operating market basket, less a percentage 
    between 0 and 2.5 percentage points depending on the hospital's or 
    unit's costs in relation to its rate-of-increase limit. The market 
    basket rate of increase is currently forecast at 2.5 percentage 
    points. This recommendation is consistent with the President's FY 
    1999 budget, although we note that the market basket rate of 
    increase was forecast at 2.7 percent when the budget was submitted.
        As required by section 1886(e)(4) of the Act, we have taken into 
    consideration the recommendations of MedPAC in setting these 
    recommended update factors. Our responses to the MedPAC 
    recommendations concerning the update factors are discussed below.
    
    III. MedPAC Recommendation for Updating the Prospective Payment 
    System Standardized Amounts
    
        For FY 1999, MedPAC's update framework would support an update 
    of the increase in the hospital market basket minus a figure between 
    4.4 percentage points and 1.1 percentage points. MedPAC notes that 
    costs per case have grown more slowly than payments per case since 
    1992 and, as a result, overall Medicare operating margins for 
    hospitals have been rising. MedPAC predicts that Medicare operating 
    margins will continue to be quite favorable even with the payment 
    reductions enacted by the Balanced Budget Act of 1997. MedPAC 
    further notes that Medicare payments are just one of many factors 
    that affect hospital margins. Thus, while MedPAC agrees with the 
    proposed update of market basket increase minus 1.9 percentage 
    points for 1999, that update is closer to the higher end than the 
    lower end of MedPAC's update framework. The Commission emphasizes 
    that, because of uncertainty about the future and the extent of 
    changes in productivity and service delivery, its recommendation 
    applies for only one year. MedPAC's estimate of the market basket 
    increase is 2.5 percent, which is 0.1 percentage points below HCFA's 
    current estimate. MedPAC's market basket estimate focuses on 
    employee compensation changes in the hospital industry and the 
    economy in general, while HCFA's market basket forecast gives less 
    weight to the projected changes in the hospital industry's wages. 
    Thus, MedPAC's update framework reflects a 0.1 percent adjustment 
    for this difference.
        Response: We agree with MedPAC's recommendation of an update for 
    FY 1999 for prospective payment system hospitals of market basket 
    minus 1.9 percentage points. Our recommendation is supported by the 
    following analyses that measure changes in hospital productivity, 
    scientific and technological advances, practice pattern changes, and 
    changes in case mix:
    
    a. Productivity
    
        Service level productivity is defined as the ratio of total 
    service output to full-time equivalent employees (FTEs). While we 
    recognize that productivity is a function of many variables (for 
    example, labor, nonlabor material, and capital inputs), we use a 
    labor productivity measure since this update framework applies to 
    operating payment. To recognize that we are apportioning the short 
    run output changes to the labor input and not considering the 
    nonlabor inputs, we weight our productivity measure for operating 
    costs by the share of direct labor services in the market basket 
    rate of increase to determine the expected effect on cost per case.
        Our recommendation for the service productivity component is 
    based on historical trends in productivity and total output for both 
    the hospital industry and the general economy, and projected levels 
    of future hospital service output. MedPAC's predecessor, the 
    Prospective Payment Assessment Commission (ProPAC), estimated 
    cumulative service productivity growth to be 4.9 percent from 1985-
    1989, or 1.2 percent annually. At the same time, MedPAC estimated 
    total output growth at 3.4 percent
    
    [[Page 25705]]
    
    annually, implying a ratio of service productivity growth to output 
    growth of 0.35.
        Since it is not possible at this time to develop a productivity 
    measure specific to Medicare patients, we examined productivity 
    (output per hour) and output (gross domestic product) for the 
    economy. Depending on the exact time period, annual changes in 
    productivity range from 0.3 to 0.35 percent of the change in output 
    (that is, a 1.0 percent increase in output would be correlated with 
    a 0.3 to 0.35 percent change in output per hour).
        Under our framework, the recommended update is based in part on 
    expected productivity--that is, projected service output during the 
    year, multiplied by the historical ratio of service productivity to 
    total service output, multiplied by the share of labor in total 
    operating inputs, as calculated in the hospital market basket rate 
    of increase. This method estimates an expected labor productivity 
    improvement in the same proportion to expected total service growth 
    that has occurred in the past and assumes that, at a minimum, growth 
    in FTEs changes proportionally to the growth in total service 
    output. Thus, the recommendation allows for unit productivity to be 
    smaller than the historical averages in years that output growth is 
    relatively low and larger in years that output growth is higher than 
    the historical averages. Based on the above estimates from both the 
    hospital industry and the economy, we have chosen to employ the 
    range of ratios of productivity change to output change of 0.30 to 
    0.35.
        The expected change in total hospital service output is the 
    product of projected growth in total admissions (adjusted for 
    outpatient usage), projected real case-mix growth, and expected 
    quality enhancing intensity growth, net of expected decline in 
    intensity due to reduction of cost ineffective practice. Case-mix 
    growth and intensity numbers for Medicare are used as proxies for 
    those of the total hospital, since case-mix increases (used in the 
    intensity measure as well) are unavailable for non-Medicare 
    patients. Thus, expected output growth is simply the sum of the 
    expected change in intensity (0.0 percent), projected admissions 
    change (-2.0 percent for FY 1999), and projected real case-mix 
    growth (0.8 percent), or -1.2 percent. The share of direct labor 
    services in the market basket rate of increase (consisting of wages, 
    salaries, and employee benefits) is 61.4 percent.
        Multiplying the expected change in total hospital service output 
    (-1.2 percent) by the ratio of historical service productivity 
    change to total service growth of 0.30 to 0.35 and by the direct 
    labor share percentage 61.4, provides our productivity standard of 
    -0.2 to -0.3 percent.
        MedPAC believes that the update should also take into account 
    the effects of product change. MedPAC analysis indicates that 
    between 1992 and 1996, the decline in length of stay and 
    corresponding increase in the intensity of services per day resulted 
    in a net reduction of about 11 percent for services provided per 
    hospital admission. In the past, ProPAC expected hospitals to 
    achieve productivity gains ranging from 0.5 percent to 2.0 percent 
    per year. This year, recognizing changes in lengths of stay and 
    sites of service, MedPAC believes a product adjustment in the range 
    of -3.0 to -1.0 percentage points is appropriate. In addition, 
    MedPAC's update framework contains a productivity adjustment of 
    between -0.7 to -0.3 percent, which is slightly more optimistic than 
    our estimate.
    
    b. Intensity
    
        We base our intensity standard on the combined effect of three 
    separate factors: Changes in the use of quality enhancing services, 
    changes in the use of services due to shifts in within-DRG severity, 
    and changes in the use of services due to reductions of cost-
    ineffective practices. For FY 1999, we recommend an adjustment of 
    0.0 percent. The basis of this recommendation is discussed below.
        We have no empirical evidence that accurately gauges the level 
    of quality-enhancing technology changes. A study published in the 
    Winter 1992 issue of the Health Care Financing Review, 
    ``Contributions of case mix and intensity change to hospital cost 
    increases'' (p. 151-163), suggests that one-third of the intensity 
    change is attributable to high-cost technology. The balance was 
    unexplained but the authors speculated that it is attributable to 
    fixed costs in service delivery.
        Typically, a specific new technology increases cost in some uses 
    and decreases cost in other uses. Concurrently, health status is 
    improved in some situations while in other situations it may be 
    unaffected or even worsened using the same technology. It is 
    difficult to separate out the relative significance of each of the 
    cost increasing effects for individual technologies and new 
    technologies.
        All things being equal, per-discharge fixed costs tend to 
    fluctuate in inverse proportion to changes in volume. Fixed costs 
    exist whether patients are treated or not. If volume is declining, 
    per-discharge fixed costs will rise, but the reverse is true if 
    volume is increasing.
        Following methods developed by HCFA's Office of the Actuary for 
    deriving hospital output estimates from total hospital charges, we 
    have developed Medicare-specific intensity measures based on a 5-
    year average using FY 1993-FY 1997 MedPAR billing data. Case-mix 
    constant intensity is calculated as the change in total Medicare 
    charges per discharge adjusted for changes in the average charge per 
    unit of service as measured by the Medical CPI hospital component 
    and changes in real case mix. Thus, in order to measure changes in 
    intensity, one must measure changes in real case mix.
        For FY 1993-FY 1997, observed case mix index change ranged from 
    a low of 0.8 percent to a high of 1.7 percent, with a 5-year average 
    change of 1.3 percent. Based on evidence from past studies of case-
    mix change, we estimate that real case mix change fluctuates between 
    1.0 and 1.4 percent and the observed values generally fall in this 
    range. The average percentage change in charge per discharge was 3.4 
    percent and the average annual change in the medical CPI was 5.7 
    percent. Dividing the change in charge per discharge by the quantity 
    of the real case-mix index change and the medical CPI, yields an 
    average annual change in intensity of -3.4 percent. Assuming the 
    technology/fixed cost ratio still holds, technology would account 
    for a -1.1 percent annual decline while fixed costs would account 
    for a -2.3 percent annual decline. The decline in fixed costs per 
    discharge makes intuitive sense as volume, measured by total 
    discharges, as increased during the period. Since we estimate that 
    intensity has declined during that period, we are recommending a 0.0 
    percent intensity adjustment for FY 1999.
    
    c. Quality Enhancing New Science and Technology
    
        For FY 1999, MedPAC has computed the adjustment for scientific 
    and technological advances to be a future-oriented policy target 
    intended to provide additional funds for hospitals to adopt quality-
    enhancing, cost increasing health care innovations. As in past 
    recommendations, MedPAC has included an adjustment ranging from 0.3 
    to 1.0 percentage points. MedPAC believes that the cost-competitive 
    environment now faced by hospitals may dampen the adoption of new 
    technologies as they closely evaluate their relative costs and 
    benefits. Therefore, MedPAC recommends an adjustment of 0.5 
    percentage points for the increase in operating costs due to 
    scientific and technological advances.
    
    d. Change in Case Mix
    
        Our analysis takes into account projected changes in case mix, 
    adjusted for changes attributable to improved coding practices. For 
    our FY 1999 update recommendation, we are projecting a 1.0 percent 
    increase in the case-mix index. We define real case-mix increase as 
    actual changes in the mix (and resource requirements) of Medicare 
    patients as opposed to changes in coding behavior that result in 
    assignment of cases to higher-weighted DRGs, but do not reflect 
    greater resource requirements. For FY 1999, we believe that real 
    case-mix increase is equal to our projected change in case mix less 
    0.2 percent. We estimate that changes in coding behavior account for 
    an increase of 0.2 percentage points in our projected case-mix 
    change. Thus, we are projecting an increase of 0.8 percentage points 
    for the real case-mix index.
        Unlike ProPAC's case-mix recommendation in previous years, 
    MedPAC did not make a specific percentage change recommendation but 
    rather estimated a range from -0.2 to 0.2 percentage point change 
    based on changes in the 1998 case mix index.
    
    e. Effect of FY 1997 DRG Reclassification and Recalibration
    
        We estimate that DRG reclassification and recalibration for FY 
    1997 resulted in a 0.0 percent increase in the case-mix index when 
    compared with the case-mix index that would have resulted if we had 
    not made the reclassification and recalibration changes to the 
    GROUPER. MedPAC does not make an adjustment for DRG reclassification 
    and recalibration in its update recommendation.
    
    f. Correction for Market Basket Forecast Error
    
        The estimated market basket percentage increase used to update 
    the FY 1997 payment
    
    [[Page 25706]]
    
    rates was 2.5 percent. Our most recent data indicate the actual FY 
    1997 increase was 2.1 percent. The resulting forecast error in the 
    FY 1997 market basket rate of increase is 0.4 percentage points. 
    Under our update framework, we make a forecast error correction if 
    our estimate is off by 0.25 percentage points or more. Therefore, we 
    are recommending an adjustment of -0.4 percentage points to reflect 
    this overestimation of the FY 1997 market basket rate of increase. 
    The following is a summary of the update ranges supported by our 
    analyses compared to MedPAC's framework.
    
                                 Table 1.--Comparison of FY 1999 Update Recommendations                             
    ----------------------------------------------------------------------------------------------------------------
                                                        HHS                                   MedPAC                
    ----------------------------------------------------------------------------------------------------------------
    Market Basket....................  MB...................................  MB                                    
    Difference between HCFA & MedPAC   .....................................  -0.1                                  
     Market Baskets.                                                                                                
                Subtotal.............  MB...................................  MB                                    
    Policy Adjustments Factors:                                                                                     
        Productivity.................  -0.3 to -0.2.........................  -0.7 to -0.3                          
        Product......................  (3)..................................  -3.0 to -1.0                          
        Intensity....................  0.0..................................                                        
            Science & Technology.....  .....................................  0.0 to 0.5                            
            Practice Patterns........  .....................................  (1)                                   
            Real Within DRG Change...  .....................................  (2)                                   
                Subtotal.............  -0.3 to -0.2.........................  -3.7 to -0.8                          
    Case-Mix Adjustment Factors:                                                                                    
        Projected Case-Mix Change....  -1.0.................................  ......................................
        Real Across DRG Change.......  0.8..................................  -0.2 to 0.0                           
        Real Within DRG Change.......  (3)..................................  0.0 to 0.2                            
                Subtotal.............  -0.2.................................  -0.2 to 0.2                           
    Effect of 1996 Reclassification &  0.0..................................  ......................................
     Recalibration.                                                                                                 
    Forecast Error Correction........  -0.4.................................  -0.4                                  
                Total Recommended      MB -0.9 to MB -0.8...................  MB -4.4 to MB -1.1                    
                 Update.                                                                                            
    ----------------------------------------------------------------------------------------------------------------
    \1\ Included in MedPAC's Productivity Measure.                                                                  
    \2\ Included in MedPAC's Case-Mix Adjustment.                                                                   
    \3\ Included in HHS' Intensity Factor.                                                                          
    
        Because we are not recommending a negative adjustment for 
    intensity (as our methodology would suggest is appropriate), the 
    update suggested by our framework appears to be more generous than 
    the recommendation of MedPAC. While the above framework would 
    support an update of the market basket increase minus 0.9 percentage 
    points, we are recommending an update of the market basket increase 
    minus 1.9 percentage points (0.7 percent). We believe that this 
    update factor appropriately adjusts for changes occurring in health 
    care delivery including the relative decrease in use of hospital 
    inpatient services and the corresponding increase in use of hospital 
    outpatient and postacute care services. We agree with MedPAC that a 
    0.7 percent update for FY 1999 would not disadvantage the hospital 
    industry nor harm Medicare beneficiaries. We also recommend that the 
    hospital-specific rates applicable to sole community and Medicare-
    dependent, small rural hospitals be increased by the same update, 
    0.7 percentage points.
    
    IV. MedPAC Recommendation for Updating the Rate-of-Increase Limits 
    for Excluded Hospitals
    
        MedPAC recommends an update factor equal to a 2.1 percent 
    average increase for TEFRA target amounts for excluded hospitals and 
    units. The update formula enacted by section 4411(a) of the Balanced 
    Budget Act is equal to the increase in the excluded hospital market 
    basket less a percentage point between 0 and 2.5 percent, depending 
    on the hospital's or unit's costs in relation to the target amount. 
    MedPAC's recommendation reflects a reduction of 0.4 percentage 
    points from HCFA's market basket increase forecast of 2.5 percent. 
    The reduction consists of an adjustment of -0.4 percentage points to 
    account for the forecast error in the FY 1997 market basket rate of 
    increase, and no allowance for new technology.
        Response: We recommend that hospitals excluded from the 
    prospective payment system also receive a 2.5 percent increase in 
    the market basket used in the update formula for TEFRA target amount 
    updates provided to the prospective payment hospitals. We believe 
    this update would ensure that Medicare acts as a prudent purchaser 
    and would provide incentives to hospitals for increased efficiency, 
    thereby contributing to the solvency of the Medicare Part A Trust 
    Fund.
    
    BILLING CODE 4120-03-U
    
    [[Page 25707]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.002
    
    
    
    [[Page 25708]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.003
    
    
    
    [[Page 25709]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.004
    
    
    
    [[Page 25710]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.005
    
    
    
    [[Page 25711]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.006
    
    
    
    [[Page 25712]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.007
    
    
    
    [[Page 25713]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.008
    
    
    
    [[Page 25714]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.009
    
    
    
    [[Page 25715]]
    
    [GRAPHIC] [TIFF OMITTED] TP08MY98.010
    
    
    [FR Doc. 98-12207 Filed 5-7-98; 8:45 am]
    BILLING CODE 4120-03-C
    
    
    

Document Information

Published:
05/08/1998
Department:
Health Care Finance Administration
Entry Type:
Proposed Rule
Action:
Proposed rule.
Document Number:
98-12207
Dates:
Comments will be considered if received at the appropriate
Pages:
25576-25715 (140 pages)
Docket Numbers:
HCFA-1003-P
RINs:
0938-AI22: Changes to the Hospital Inpatient Prospective Payment Systems and Fiscal Year 1999 Rates (HCFA-1003-P)
RIN Links:
https://www.federalregister.gov/regulations/0938-AI22/changes-to-the-hospital-inpatient-prospective-payment-systems-and-fiscal-year-1999-rates-hcfa-1003-p
PDF File:
98-12207.pdf
CFR: (16)
42 CFR 413.86(b)
42 CFR 413.85(c)
42 CFR 412.308(c)(1)
42 CFR 413.85(d)
42 CFR 405.2468
More ...