19188 Federal Register / Vol. 65, No. 69 / Monday, April 10, 2000 / Proposed Rules DEPARTMENT OF HEALTH AND timely will be available for public 3. Payment ProvisionsÐFacility-Specific HUMAN SERVICES inspection as they are received, Rate generally beginning approximately 3 II. Update of Payment Rates Under the Health Care Financing Administration weeks after publication of a document, Prospective Payment System for Skilled Nursing Facilities in Room 443±G of the Department's A. Federal Prospective Payment System 42 CFR Parts 411 and 489 office at 200 Independence Avenue, 1. Cost and Services covered by the Federal SW., Washington, DC, on Monday [HCFA±1112±P] Rates through Friday of each week from 8:30 2. Methodology Used for the Calculation of RIN 0938±AJ93 to 5 p.m. (phone: (202) 690±7061). the Federal Rates FOR FURTHER INFORMATION CONTACT: B. Case-Mix Adjustment and Options C. Wage Index Adjustment to Federal Rates Medicare Program; Prospective Dana Burley, (410) 786±4547 or Sheila Payment System and Consolidated D. Updates to the Federal Rates Lambowitz, (410) 786±7605 (for E. Relationship of RUG±III Classification Billing for Skilled Nursing FacilitiesÐ information related to the case-mix Update System to Existing Skilled Nursing classification methodology). Facility Level-of-Care Criteria AGENCY: Health Care Financing John Davis, (410) 786±0008 (for III. Three-Year Transition Period Administration (HCFA), HHS. information related to the Wage IV. The Skilled Nursing Facility Market Index). Basket Index ACTION: Notice of proposed rulemaking. Bill Ullman, (410) 786±5667 (for A. Facility-Specific Rate Update Factor information related to consolidated B. Federal Rate Update Factor SUMMARY: This proposed rule sets forth V. Consolidated Billing updates to the payment rates used under billing). VI. Provisions of the Proposed Rule the prospective payment system (PPS) Steve Raitzyk, (410) 786±4599 (for VII. Collection of Information Requirements for skilled nursing facilities (SNFs), for information related to the facility- VIII. Response to Comments fiscal year 2001. Furthermore, it specific transition rates). IX. Regulatory Impact Analysis Bill Ullman, (410) 786±5667 and Susan specifically proposes changes to the A. Background Burris (410) 786±6655 (for general B. Impact of this Proposed Rule SNF PPS case-mix methodology. information). X. Federalism Annual updates to the PPS rates are Regulations Text required by section 1888(e) of the Social SUPPLEMENTARY INFORMATION: Copies: To Technical Appendix A Security Act, as amended by the order copies of the Federal Register A. Creation of the Analytic Sample Medicare, Medicaid and State Child containing this document, send your B. Characteristics of the Sample Health Insurance Program Balanced request to: New Orders, Superintendent C. Test and Validation Samples Budget Refinement Act of 1999, related of Documents, P.O. Box 371954, D. Creation of Measure of Non-Therapy to Medicare payments and consolidated Pittsburgh, PA 15250±7954. Please Ancillary Charges from SNF Claims billing for SNFs. In addition, this specify the date of the issue requested 1. Cost-to-Charge Multiplier and enclose a check or money order E. Analysis and FindingsÐRUG±III proposed rule sets forth certain Refinements conforming revisions to the regulations payable to the Superintendent of 1. Costs for Beneficiaries Who Qualify for that are necessary in order to implement Documents, or enclose your Visa or Both Extensive Services and amendments made to the Act by section Master Card number and expiration Rehabilitation 103 of the Medicare, Medicaid and State date. Credit card orders can also be 2. Non-Therapy Ancillary Index Models Child Health Insurance Program placed by calling the order desk at (202) F. Model Performance Balanced Budget Refinement Act of 512±1800 (or toll free at 1±888±293± 1. RUG±III CMI Adjustment 1999. 6498) or by faxing to (202) 512±2250. 2. RUG±III (proposed, version 2001) The cost for each copy is $8. As an 3. Weighted Index Model (WIM1) DATES: 4. Weighted Index Model 2 (WIM2) We will consider comments if alternative, you can view and we receive them at the appropriate 5. Unweighted Index Model (UWIM) photocopy the Federal Register G. RUG±III Medications Data address, as provided below, no later document at most libraries designated than 5 p.m. on June 9, 2000. 1. Creation of MDS-Based Cost Measures as Federal Depository Libraries and at 2. RUG±Based Imputation Method ADDRESSES: Mail written comments (1 many other public and academic 3. State and Year-Based Imputation original and 3 copies) to the following libraries throughout the country that Method address: Health Care Financing receive the Federal Register. In addition, because of the many Administration, Department of Health To assist readers in referencing terms to which we refer by abbreviation and Human Services, Attention: HCFA± sections contained in this document, we in this rule, we are listing these 1112±P, P.O. Box 8013, Baltimore, MD are providing the following table of abbreviations and their corresponding 21244±8013. contents. terms in alphabetical order below: If you prefer, you may deliver your written comments (1 original and 3 Table of Contents ADLÐActivity of Daily Living copies) to one of the following I. Background BBAÐBalanced Budget Act of 1997 BBRAÐBalanced Budget Refinement Act of addresses: A. Current System for Payment of Skilled Nursing Facility Services Under Part A 1999 Room 443±G, Hubert H. Humphrey of the Medicare Program BLSÐ(U.S.) Bureau of Labor Statistics Building, 200 Independence Avenue, B. Requirements of the Balanced Budget CPIÐConsumer Price Index SW., Washington, DC 20201, or Act of 1997 for Updating the Prospective HCFAÐ Health Care Financing Room C5±15±03, 7500 Security Payment System for Skilled Nursing Administration Boulevard, Baltimore, MD 21244± Facilities HCPCSÐHCFA Common Procedure Coding 8150. C. The Medicare, Medicaid and State Child System IFCÐInterim Final Rule with Comments Because of staffing and resource Health Insurance Program (SCHIP) Balanced Budget Refinement Act of 1999 MDSÐMinimum Data Set limitations, we cannot accept comments D. Skilled Nursing Facility Prospective MSAÐMetropolitan Statistical Area by facsimile (FAX) transmission. In PaymentÐGeneral Overview PPIÐProducer Price Index commenting, please refer to file code 1. Payment ProvisionsÐFederal Rates PPSÐProspective Payment System HCFA±1112±P. Comments received 2. Payment ProvisionsÐTransition Period PRMÐProvider Reimbursement Manual VerDate 20<MAR>2000 22:49 Apr 07, 2000 Jkt 190000 PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 E:\FR\FM\10APP4.SGM pfrm03 PsN: 10APP4 Federal Register / Vol. 65, No. 69 / Monday, April 10, 2000 / Proposed Rules 19189 RUGÐResource Utilization Group services that, before July 1, 1998, had blend used changes for each cost SCHIPÐState Child Health Insurance been paid under Part B but furnished to reporting period after a facility migrates Program Medicare beneficiaries in a SNF during to the new system. For most facilities, SNFÐSkilled Nursing Facility a Part A covered stay. Rates are case-mix the facility-specific rate is based on I. Background adjusted using a refined classification allowable costs from FY 1995. As a system (Resource Utilization Groups, result of section 102 of the BBRA of A. Current System for Payment of version III (RUG±III)) based on 1999, SNFs may elect immediate Skilled Nursing Facility Services Under beneficiary assessments (using the transition to the Federal rate on or after Part A of the Medicare Program Minimum Data Set (MDS) 2.0). The December 15, 1999 for cost reporting Section 4432 of the Balanced Budget proposed refinement to the RUG periods beginning on or after January 1, Act of 1997 (BBA) (Pub. L. 105±33) classification system is based on critical 2000. There is no such election for cost mandated the implementation of a per analysis which examined various reporting periods beginning before diem prospective payment system (PPS) options to account more precisely for January 1, 2000. SNFs may elect for skilled nursing facilities (SNFs), the variation in non-therapy ancillary immediate transition up to 30 days after covering all costs (routine, ancillary, services in our payments and the care the start of their cost reporting period. and capital) of covered SNF services needs of medically complex patients. • Coverage: The PPS statute did not furnished to beneficiaries under Part A The proposed RUG refinement includes change Medicare's fundamental of the Medicare program, effective for the addition of new categories and requirements for SNF coverage. cost reporting periods beginning on or incorporation of an ancillary index, as However, because RUG±III classification after July 1, 1998. The SNF PPS discussed in further detail in section is based, in part, on the beneficiary's payment methodology features a case- II.B. In addition, the Federal rates are need for skilled nursing care and mix adjustment that utilizes data from adjusted by the hospital wage index to therapy, we have attempted where the comprehensive assessment process account for geographic variation in possible to coordinate claims review required for every SNF beneficiary in wages. At this time, data for the FY 2001 procedures with the outputs of order to group them clinically in terms hospital wage index is not yet available; beneficiary assessment and RUG±III of their degree of resource intensity. The therefore, the index applied in this classifying activities. For example, we case-mix adjustment is designed to proposed rule is the same index used in believe that when an initial Medicare ensure that the amount of the PPS per the July 30, 1999 update notice. We will required (5-day) assessment, properly diem payment is appropriate to the be updating the wage index in the final completed, places the beneficiary in one individual beneficiary's actual rule using the latest hospital wage data. of the upper RUG±III classifications that condition, and is sufficient to purchase Further, the rates are adjusted annually we designate as representing a covered the full range of care and services that using an SNF market basket index.