In the proposed IPPS rule published on May 18 (69 Fed. Reg. 28196, 28266), CMS proposed a wage index adjustment based on commuting patterns of hospital employees, pursuant to the direction of Congress in Section 505 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 ("MMA"). In the proposed rule, in table 4J on page 28631, CMS lists hospitals qualified for this adjustment by provider number and county name. The hospitals and counties that were chosen were deemed qualified based on a CMS analysis of the 2000 Census Bureau data. If more than 10 percent of hospital workers who reside in a county travel to a different county with a higher wage index for employment, hospitals in the county where the employees migrated from were deemed eligible for this adjustment. The adjustment for each hospital will be determined based on an equation of the percentage of hospital employees residing in a qualifying county who are employed in any higher wage index area, the wage index of the higher index area, the wage index of the qualifying resident county, the number of hospital employees residing in the qualifying county who are employed in the higher wage index area, and the total number of hospital employees residing in the qualifying county who are employed in any higher wage index area. Any hospital that elects this adjustment will maintain its qualifying status for three years, and may not receive any other adjustment of reclassification during this three year period under Sections 1886(d)(8) or 1886(d)(10) of the Social Security Act. Also, any hospital on the eligibility list must give up any other wage index reclassification in order to receive this adjustment. Hospitals that wish to withdraw a prior reclassification by the Medicare Geographic Classification Review Board (including reclassifications under Section 508 of the MMA) in order to receive this adjustment may terminate an existing reclassification within 45 days of the publication of the proposed rule. CMS is proposing to automatically apply this adjustment to hospitals that qualify and are not currently reclassified unless they elect to opt-out of the adjustment within 45 days of the publication of the proposed rule.
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