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| "Wage Index Classification" |
Health Headlines Special Alert, December 22, 2003
Issue Editor: Andrew Ruskin |
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WAGE INDEX RECLASSIFICATION — Section 508 of the Medicare Prescription Drug, Improvement and Modernization Act ("DIMA") authorizes the Secretary of the Department of Health and Human Services (the "Secretary") to grant hospitals one-time wage reclassification to another area within the same or a contiguous state if the applying hospital does not otherwise qualify for wage reclassification. This special reclassification would commence April 1, 2004 and last for three years. The law is very open-ended on the criteria for reclassification: it states only that a qualifying hospital is one which does not currently qualify for reclassification because of distance or commuting and meets "such other criteria, such as quality as the Secretary may specify."
The Secretary must establish the criteria for reclassification no later than January 1, 2004. Once the criteria are established, the process will be administered by the Medicare Geographic Classification Review Board ("MGCRB"). In the past, the MGCRB's role has been largely mechanical in applying fairly rigid criteria for geographic reclassification established by CMS. We strongly suspect that the same will be true of the process for this one-time reclassification, i.e., the time for hospitals to try to influence the process is now while the criteria are being developed. There is no formal process for CMS to accept comments on the appropriate criteria for this one-time wage reclassification process. The most effective way to influence the process will probably be through submission of comments by a member of Congress. Time is of the essence. Comments should probably be given to CMS this week in order to realistically affect the development of criteria.
Once the criteria are set by CMS, the MGCRB will consider applications by hospitals seeking reclassification under this provision and make eligibility determinations applying the published criteria. Applications for reclassification under Section 508 are due no later than February 15, 2004. For further information please contact Larry Oday, Washington, 202-639-6792, loday@velaw.com; Dennis Barry, Washington, 202-639-6791, dbarry@velaw.com; or any other V&E; lawyer.
To view this week's Health Briefs (a listing of Federal and Texas regulations affecting health care), visit our website at:
http://www.velaw.com/pdf/resources/HB121203.pdf
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