80_FR_71028 80 FR 70808 - Medicare Program; CY 2016 Inpatient Hospital Deductible and Hospital and Extended Care Services Coinsurance Amounts

80 FR 70808 - Medicare Program; CY 2016 Inpatient Hospital Deductible and Hospital and Extended Care Services Coinsurance Amounts

DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services

Federal Register Volume 80, Issue 220 (November 16, 2015)

Page Range70808-70810
FR Document2015-29207

This notice announces the inpatient hospital deductible and the hospital and extended care services coinsurance amounts for services furnished in calendar year (CY) 2016 under Medicare's Hospital Insurance Program (Medicare Part A). The Medicare statute specifies the formulae used to determine these amounts. For CY 2016, the inpatient hospital deductible will be $1,288. The daily coinsurance amounts for CY 2016 will be: (1) $322 for the 61st through 90th day of hospitalization in a benefit period; (2) $644 for lifetime reserve days; and (3) $161.00 for the 21st through 100th day of extended care services in a skilled nursing facility in a benefit period.

Federal Register, Volume 80 Issue 220 (Monday, November 16, 2015)
[Federal Register Volume 80, Number 220 (Monday, November 16, 2015)]
[Notices]
[Pages 70808-70810]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-29207]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-8059-N]
RIN 0938-AS36


Medicare Program; CY 2016 Inpatient Hospital Deductible and 
Hospital and Extended Care Services Coinsurance Amounts

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

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This notice announces the inpatient hospital deductible and 
the hospital and extended care services coinsurance amounts for 
services furnished in calendar year (CY) 2016 under Medicare's Hospital 
Insurance Program (Medicare Part A). The Medicare statute specifies the 
formulae used to determine these amounts. For CY 2016, the inpatient 
hospital deductible will be $1,288. The daily coinsurance amounts for 
CY 2016 will be: (1) $322 for the 61st through 90th day of 
hospitalization in a benefit period; (2) $644 for lifetime reserve 
days; and (3) $161.00 for the 21st through 100th day of extended care 
services in a skilled nursing facility in a benefit period.

DATES: Effective Date: This notice is effective on January 1, 2016.

FOR FURTHER INFORMATION CONTACT: Clare McFarland, (410) 786-6390 for 
general information. Gregory J. Savord, (410) 786-1521 for case-mix 
analysis.

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 1813 of the Social Security Act (the Act) provides for an 
inpatient hospital deductible to be subtracted from the amount payable 
by Medicare for inpatient hospital services furnished to a beneficiary. 
It also provides for certain coinsurance amounts to be subtracted from 
the amounts payable by Medicare for inpatient hospital and extended 
care services. Section 1813(b)(2) of the Act requires us to determine 
and publish each year the amount of the inpatient hospital deductible 
and the hospital and extended care services coinsurance amounts 
applicable for services furnished in the following calendar year (CY).

II. Computing the Inpatient Hospital Deductible for CY 2016

    Section 1813(b) of the Act prescribes the method for computing the 
amount of the inpatient hospital deductible. The inpatient hospital 
deductible is an amount equal to the inpatient hospital deductible for 
the preceding CY, adjusted by our best estimate of the payment-weighted 
average of the applicable percentage increases (as defined in section 
1886(b)(3)(B) of the Act) used for updating the payment rates to 
hospitals for discharges in the fiscal year (FY) that begins on October 
1 of the same preceding CY, and adjusted to reflect changes in real 
case-mix. The adjustment to reflect real case-mix is determined on the 
basis of the most recent case-mix data available. The amount determined 
under this formula is rounded to the nearest multiple of $4 (or, if 
midway between two multiples of $4, to the next higher multiple of $4).
    Under section 1886(b)(3)(B)(i)(XX) of the Act, the percentage 
increase used to update the payment rates for FY 2016 for hospitals 
paid under the inpatient prospective payment system is the market 
basket percentage increase, otherwise known as the market basket 
update, reduced by 0.2 percentage points (see section 
1886(b)(3)(B)(xii)(IV) of the Act), and an adjustment based on changes 
in the economy-wide productivity (the multifactor productivity (MFP) 
adjustment) (see section 1886(b)(3)(B)(xi)(II) of the Act). Under 
section 1886(b)(3)(B)(viii) of the Act, for fiscal year 2016, the 
applicable percentage increase for hospitals that do not submit quality 
data as specified by the Secretary of the Department of Health and 
Human Services (the Secretary) is reduced by one quarter of the market 
basket update. We are estimating that after accounting for those 
hospitals receiving the lower market basket update in the payment-
weighted average update, the calculated deductible will not be 
affected, since the majority of hospitals submit quality data and 
receive the full market basket update. Section 1886(b)(3)(B)(ix) of the 
Act requires that any hospital that is not a meaningful electronic 
health record (EHR) user (as defined in section 1886(n)(3) of the Act) 
will have three-quarters of the market basket update reduced by 33\1/3\ 
percent for FY 2015, 66\2/3\ percent for FY 2016, and 100 percent for 
FY 2017 and each subsequent fiscal year. We are estimating that after 
accounting for these hospitals receiving the lower market basket 
update, the calculated deductible will not be affected, since the 
majority of hospitals are meaningful EHR users and are expected to 
receive the full market basket update.
    Under section 1886(b)(3)(B)(ii)(VIII) of the Act, the percentage 
increase used to update the payment rates for FY 2016 for hospitals 
excluded from the inpatient prospective payment system is as follows:
     The percentage increase for long term care hospitals is 
the market basket percentage increase reduced by 0.2 percentage points 
and the MFP adjustment (see sections 1886(m)(3)(A) and 1886(m)(4)(E) of 
the Act).
     The percentage increase for inpatient rehabilitation 
facilities is the market basket percentage increase reduced by 0.2 
percentage points and the MFP adjustment (see sections 1886(j)(3)(C) 
and 1886(j)(3)(D)(iv) of the Act).
     The percentage increase used to update the payment rate 
for inpatient psychiatric facilities is the market basket percentage 
increase reduced by 0.2 percentage points and the MFP adjustment (see 
sections 1886(s)(2)(A)(i), 1886(s)(2)(A)(ii), and 1886(s)(3)(D) of the 
Act).
    The Inpatient Prospective Payment System market basket percentage 
increase for 2016 is 2.4 percent and the MFP adjustment is 0.5 percent, 
as announced in the final rule that appeared in the Federal Register on 
August 17, 2015 entitled, ``Hospital Inpatient Prospective Payment 
Systems for Acute Care Hospitals and the Long-Term Care Hospital 
Prospective Payment System Policy Changes and Fiscal Year 2016 Rates'' 
(80 FR 49510). Therefore, the percentage increase for hospitals paid 
under the inpatient prospective payment system that submit quality data 
and are meaningful EHR users is 1.7 percent (that is, the FY 2016 
market basket update of 2.4 percent less the MFP adjustment of 0.5 
percentage point and less 0.2 percentage point). The average payment 
percentage increase for hospitals excluded from the inpatient 
prospective payment system is 1.82 percent. Weighting these percentages 
in accordance with payment volume, our best estimate of

[[Page 70809]]

the payment-weighted average of the increases in the payment rates for 
FY 2016 is 1.72 percent.
    To develop the adjustment to reflect changes in real case-mix, we 
first calculated an average case-mix for each hospital that reflects 
the relative costliness of that hospital's mix of cases compared to 
those of other hospitals. We then computed the change in average case-
mix for hospitals paid under the Medicare prospective payment system in 
FY 2015 compared to FY 2014. (We excluded from this calculation 
hospitals whose payments are not based on the inpatient prospective 
payment system because their payments are based on alternate 
prospective payment systems or reasonable costs.) We used Medicare 
bills from prospective payment hospitals that we received as of July 
2015. These bills represent a total of about 7.6 million Medicare 
discharges for FY 2015 and provide the most recent case-mix data 
available at this time. Based on these bills, the change in average 
case-mix in FY 2015 is 0.21 percent. Based on these bills and past 
experience, we expect the overall case mix change to be 0.5 percent as 
the year progresses and more FY 2015 data become available.
    Section 1813 of the Act requires that the inpatient hospital 
deductible be adjusted only by that portion of the case-mix change that 
is determined to be real. Real case-mix is that portion of case-mix 
that is due to changes in the mix of cases in the hospital and not due 
to coding optimization. We expect that all of the change in average 
case-mix will be real and estimate that this change will be 0.5 
percent.
    Thus as stated above, the estimate of the payment-weighted average 
of the applicable percentage increases used for updating the payment 
rates is 1.72 percent, and the real case-mix adjustment factor for the 
deductible is 0.5 percent. Therefore, using the statutory formula as 
stated in section 1813(b) of the Act, we calculate the inpatient 
hospital deductible for services furnished in CY 2016 to be $1,288. 
This deductible amount is determined by multiplying $1,260 (the 
inpatient hospital deductible for CY 2015 (79 FR 49854)) by the 
payment-weighted average increase in the payment rates of 1.0172 
multiplied by the increase in real case-mix of 1.005, which equals 
$1,288.08 and is rounded to $1,288.

III. Computing the Inpatient Hospital and Extended Care Services 
Coinsurance Amounts for CY 2016

    The coinsurance amounts provided for in section 1813 of the Act are 
defined as fixed percentages of the inpatient hospital deductible for 
services furnished in the same CY. The increase in the deductible 
generates increases in the coinsurance amounts. For inpatient hospital 
and extended care services furnished in CY 2016, in accordance with the 
fixed percentages defined in the law, the daily coinsurance for the 
61st through 90th day of hospitalization in a benefit period will be 
$322 (one-fourth of the inpatient hospital deductible as stated in 
section 1813(a)(1)(A) of the Act); the daily coinsurance for lifetime 
reserve days will be $644 (one-half of the inpatient hospital 
deductible as stated in section 1813(a)(1)(B) of the Act); and the 
daily coinsurance for the 21st through 100th day of extended care 
services in a skilled nursing facility in a benefit period will be $161 
(one-eighth of the inpatient hospital deductible as stated in section 
1813(a)(3) of the Act).

IV. Cost to Medicare Beneficiaries

    Table 1 below summarizes the deductible and coinsurance amounts for 
CYs 2015 and 2016, as well as the number of each that is estimated to 
be paid.

    Table 1--Part A Deductible and Coinsurance Amounts for Calendar Years 2015 and 2016 Type of Cost Sharing
----------------------------------------------------------------------------------------------------------------
                                                               Value                Number paid  (in millions)
                                                 ---------------------------------------------------------------
                                                       2015            2016            2015            2016
----------------------------------------------------------------------------------------------------------------
Inpatient hospital deductible...................           $1260           $1288            7.73            7.75
Daily coinsurance for 61st-90th Day.............             315             322            1.83            1.83
Daily coinsurance for lifetime reserve days.....             630             644            0.89            0.89
SNF coinsurance.................................          157.50             161           41.47           42.67
----------------------------------------------------------------------------------------------------------------

    The estimated total increase in costs to beneficiaries is about 
$610 million (rounded to the nearest $10 million) due to: (1) The 
increase in the deductible and coinsurance amounts, and (2) the 
increase in the number of deductibles and daily coinsurance amounts 
paid. We determine the increase in cost to beneficiaries by calculating 
the difference between the 2015 and 2016 deductible and coinsurance 
amounts multiplied by the increase in the number of deductible and 
coinsurance amounts paid.

V. Waiver of Proposed Notice and Comment Period

    Section 1813(b)(2) of the Act requires publication of the inpatient 
hospital deductible and all coinsurance amounts--the hospital and 
extended care services coinsurance amounts--between September 1 and 
September 15 of the year preceding the year to which they will apply. 
These amounts are determined according to the statute as discussed 
above. As has been our custom, we use general notices, rather than 
notice and comment rulemaking procedures, to make the announcements. In 
doing so, we acknowledge that under the Administrative Procedure Act 
(APA), interpretive rules, general statements of policy, and rules of 
agency organization, procedure, or practice are excepted from the 
requirements of notice and comment rulemaking.
    We considered publishing a proposed notice to provide a period for 
public comment. However, we may waive that procedure if we find good 
cause that prior notice and comment are impracticable, unnecessary, or 
contrary to the public interest. We find that the procedure for notice 
and comment is unnecessary here, because the formulae used to calculate 
the inpatient hospital deductible and hospital and extended care 
services coinsurance amounts are statutorily directed, and we can 
exercise no discretion in following the formulae. Moreover, the statute 
establishes the time period for which the deductible and coinsurance 
amounts will apply and delaying publication would be contrary to the 
public interest.

[[Page 70810]]

Therefore, we find good cause to waive publication of a proposed notice 
and solicitation of public comments.

VI. Collection of Information Requirements

    This document does not impose information collection requirements, 
that is, reporting, recordkeeping or third-party disclosure 
requirements. Consequently, there is no need for review by the Office 
of Management and Budget under the authority of the Paperwork Reduction 
Act of 1995 (44 U.S.C. 3501 et seq.).

VII. Regulatory Impact Analysis

A. Statement of Need

    Section 1813(b)(2) of the Act requires the Secretary to publish, 
between September 1 and September 15 of each year, the amounts of the 
inpatient hospital deductible and hospital and extended care services 
coinsurance applicable for services furnished in the following calendar 
year (CY).

B. Overall Impact

    We have examined the impact of this rule as required by Executive 
Order 12866 on Regulatory Planning and Review (September 30, 1993), 
Executive Order 13563 on Improving Regulation and Regulatory Review 
(January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, 
section 202 of the Unfunded Mandates Reform Act of 1995 (March 22, 
1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 
1999) and the Congressional Review Act (5 U.S.C., Part I, Ch. 8).
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
regulatory impact analysis (RIA) must be prepared for major notices 
with economically significant effects ($100 million or more in any 1 
year). As stated in section IV of this notice, we estimate that the 
total increase in costs to beneficiaries associated with this notice is 
about $610 million due to: (1) The increase in the deductible and 
coinsurance amounts, and (2) the increase in the number of deductibles 
and daily coinsurance amounts paid. As a result, this notice is 
economically significant under section 3(f)(1) of Executive Order 12866 
and is a major action under the Congressional Review Act. In accordance 
with the provisions of Executive Order 12866, this notice was reviewed 
by the Office of Management and Budget.
    The RFA requires agencies to analyze options for regulatory relief 
of small entities, if a rule has a significant impact on a substantial 
number of small entities. For purposes of the RFA, small entities 
include small businesses, nonprofit organizations, and small 
governmental jurisdictions. Most hospitals and most other providers and 
suppliers are small entities, either by nonprofit status or by having 
revenues of less than $7.5 million to $38.5 million in any 1 year (for 
details, see the Small Business Administration's Web site at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf). 
Individuals and states are not included in the definition of a small 
entity. As discussed above, this annual notice announces the inpatient 
hospital deductible and the hospital and extended care services 
coinsurance amounts for services furnished in CY 2016 under Medicare's 
Hospital Insurance Program (Medicare Part A). As a result, we are not 
preparing an analysis for the RFA because the Secretary has determined 
that this notice will not have a significant economic impact on a 
substantial number of small entities.
    In addition, section 1102(b) of the Social Security Act requires us 
to prepare a regulatory impact analysis if a rule may have a 
significant impact on the operations of a substantial number of small 
rural hospitals. This analysis must conform to the provisions of 
section 604 of the RFA. For purposes of section 1102(b) of the Act, we 
define a small rural hospital as a hospital that is located outside of 
a Metropolitan Statistical Area for Medicare payment regulations and 
has fewer than 100 beds. As discussed above, we are not preparing an 
analysis for section 1102(b) of the Act because the Secretary has 
determined that this notice will not have a significant impact on the 
operations of a substantial number of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. For 2015, that 
threshold accounting for inflation is approximately $144 million. This 
notice does not impose mandates that will have a consequential effect 
of $144 million or more on state, local, or tribal governments or on 
the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on state 
and local governments, preempts state law, or otherwise has Federalism 
implications. Since this notice does not impose any costs on state or 
local governments, preempt state law, or have Federalism implications, 
the requirements of Executive Order 13132 are not applicable.

    Dated: November 6, 2015.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
    Dated: November 9, 2015.
Sylvia M. Burwell,
Secretary, Department of Health and Human Services.
[FR Doc. 2015-29207 Filed 11-10-15; 4:15 pm]
BILLING CODE 4120-01-P



                                              70808                      Federal Register / Vol. 80, No. 220 / Monday, November 16, 2015 / Notices

                                              Form Number: CMS–3427 (OMB control                      for inpatient hospital services furnished             Act requires that any hospital that is not
                                              number: 0938–0360); Frequency: Every                    to a beneficiary. It also provides for                a meaningful electronic health record
                                              three years; Affected Public: Private                   certain coinsurance amounts to be                     (EHR) user (as defined in section
                                              sector (Business or other for-profit and                subtracted from the amounts payable by                1886(n)(3) of the Act) will have three-
                                              Not-for profit institutions); Number of                 Medicare for inpatient hospital and                   quarters of the market basket update
                                              Respondents: 6,138; Total Annual                        extended care services. Section                       reduced by 331⁄3 percent for FY 2015,
                                              Responses: 2,046; Total Annual Hours:                   1813(b)(2) of the Act requires us to                  662⁄3 percent for FY 2016, and 100
                                              682. (For policy questions regarding this               determine and publish each year the                   percent for FY 2017 and each
                                              collection contact Judith Kari at 410–                  amount of the inpatient hospital                      subsequent fiscal year. We are
                                              786–6829)                                               deductible and the hospital and                       estimating that after accounting for
                                                 Dated: November 10, 2015.                            extended care services coinsurance                    these hospitals receiving the lower
                                                                                                      amounts applicable for services                       market basket update, the calculated
                                              William N. Parham, III,
                                                                                                      furnished in the following calendar year              deductible will not be affected, since the
                                              Director, Paperwork Reduction Staff, Office
                                                                                                      (CY).                                                 majority of hospitals are meaningful
                                              of Strategic Operations and Regulatory
                                              Affairs.
                                                                                                                                                            EHR users and are expected to receive
                                                                                                      II. Computing the Inpatient Hospital
                                                                                                                                                            the full market basket update.
                                              [FR Doc. 2015–29160 Filed 11–13–15; 8:45 am]            Deductible for CY 2016                                  Under section 1886(b)(3)(B)(ii)(VIII) of
                                              BILLING CODE 4120–01–P                                     Section 1813(b) of the Act prescribes              the Act, the percentage increase used to
                                                                                                      the method for computing the amount of                update the payment rates for FY 2016
                                                                                                      the inpatient hospital deductible. The                for hospitals excluded from the
                                              DEPARTMENT OF HEALTH AND                                inpatient hospital deductible is an                   inpatient prospective payment system is
                                              HUMAN SERVICES                                          amount equal to the inpatient hospital                as follows:
                                              Centers for Medicare & Medicaid
                                                                                                      deductible for the preceding CY,                        • The percentage increase for long
                                                                                                      adjusted by our best estimate of the                  term care hospitals is the market basket
                                              Services
                                                                                                      payment-weighted average of the                       percentage increase reduced by 0.2
                                              [CMS–8059–N]                                            applicable percentage increases (as                   percentage points and the MFP
                                              RIN 0938–AS36                                           defined in section 1886(b)(3)(B) of the               adjustment (see sections 1886(m)(3)(A)
                                                                                                      Act) used for updating the payment                    and 1886(m)(4)(E) of the Act).
                                              Medicare Program; CY 2016 Inpatient                     rates to hospitals for discharges in the                • The percentage increase for
                                              Hospital Deductible and Hospital and                    fiscal year (FY) that begins on October               inpatient rehabilitation facilities is the
                                              Extended Care Services Coinsurance                      1 of the same preceding CY, and                       market basket percentage increase
                                              Amounts                                                 adjusted to reflect changes in real case-             reduced by 0.2 percentage points and
                                                                                                      mix. The adjustment to reflect real case-             the MFP adjustment (see sections
                                              AGENCY: Centers for Medicare &                          mix is determined on the basis of the                 1886(j)(3)(C) and 1886(j)(3)(D)(iv) of the
                                              Medicaid Services (CMS), HHS.                           most recent case-mix data available. The              Act).
                                              ACTION: Notice.                                         amount determined under this formula                    • The percentage increase used to
                                                                                                      is rounded to the nearest multiple of $4              update the payment rate for inpatient
                                              SUMMARY:   This notice announces the                    (or, if midway between two multiples of               psychiatric facilities is the market
                                              inpatient hospital deductible and the                   $4, to the next higher multiple of $4).               basket percentage increase reduced by
                                              hospital and extended care services                        Under section 1886(b)(3)(B)(i)(XX) of              0.2 percentage points and the MFP
                                              coinsurance amounts for services                        the Act, the percentage increase used to              adjustment (see sections
                                              furnished in calendar year (CY) 2016                    update the payment rates for FY 2016                  1886(s)(2)(A)(i), 1886(s)(2)(A)(ii), and
                                              under Medicare’s Hospital Insurance                     for hospitals paid under the inpatient                1886(s)(3)(D) of the Act).
                                              Program (Medicare Part A). The                          prospective payment system is the                       The Inpatient Prospective Payment
                                              Medicare statute specifies the formulae                 market basket percentage increase,                    System market basket percentage
                                              used to determine these amounts. For                    otherwise known as the market basket                  increase for 2016 is 2.4 percent and the
                                              CY 2016, the inpatient hospital                         update, reduced by 0.2 percentage                     MFP adjustment is 0.5 percent, as
                                              deductible will be $1,288. The daily                    points (see section 1886(b)(3)(B)(xii)(IV)            announced in the final rule that
                                              coinsurance amounts for CY 2016 will                    of the Act), and an adjustment based on               appeared in the Federal Register on
                                              be: (1) $322 for the 61st through 90th                  changes in the economy-wide                           August 17, 2015 entitled, ‘‘Hospital
                                              day of hospitalization in a benefit                     productivity (the multifactor                         Inpatient Prospective Payment Systems
                                              period; (2) $644 for lifetime reserve                   productivity (MFP) adjustment) (see                   for Acute Care Hospitals and the Long-
                                              days; and (3) $161.00 for the 21st                      section 1886(b)(3)(B)(xi)(II) of the Act).            Term Care Hospital Prospective
                                              through 100th day of extended care                      Under section 1886(b)(3)(B)(viii) of the              Payment System Policy Changes and
                                              services in a skilled nursing facility in               Act, for fiscal year 2016, the applicable             Fiscal Year 2016 Rates’’ (80 FR 49510).
                                              a benefit period.                                       percentage increase for hospitals that do             Therefore, the percentage increase for
                                              DATES: Effective Date: This notice is                   not submit quality data as specified by               hospitals paid under the inpatient
                                              effective on January 1, 2016.                           the Secretary of the Department of                    prospective payment system that submit
                                              FOR FURTHER INFORMATION CONTACT:                        Health and Human Services (the                        quality data and are meaningful EHR
                                              Clare McFarland, (410) 786–6390 for                     Secretary) is reduced by one quarter of               users is 1.7 percent (that is, the FY 2016
                                              general information. Gregory J. Savord,                 the market basket update. We are                      market basket update of 2.4 percent less
                                              (410) 786–1521 for case-mix analysis.                   estimating that after accounting for                  the MFP adjustment of 0.5 percentage
tkelley on DSK3SPTVN1PROD with NOTICES




                                              SUPPLEMENTARY INFORMATION:                              those hospitals receiving the lower                   point and less 0.2 percentage point).
                                                                                                      market basket update in the payment-                  The average payment percentage
                                              I. Background                                           weighted average update, the calculated               increase for hospitals excluded from the
                                                 Section 1813 of the Social Security                  deductible will not be affected, since the            inpatient prospective payment system is
                                              Act (the Act) provides for an inpatient                 majority of hospitals submit quality data             1.82 percent. Weighting these
                                              hospital deductible to be subtracted                    and receive the full market basket                    percentages in accordance with
                                              from the amount payable by Medicare                     update. Section 1886(b)(3)(B)(ix) of the              payment volume, our best estimate of


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                                                                                Federal Register / Vol. 80, No. 220 / Monday, November 16, 2015 / Notices                                                               70809

                                              the payment-weighted average of the                                   adjusted only by that portion of the                           defined as fixed percentages of the
                                              increases in the payment rates for FY                                 case-mix change that is determined to                          inpatient hospital deductible for
                                              2016 is 1.72 percent.                                                 be real. Real case-mix is that portion of                      services furnished in the same CY. The
                                                To develop the adjustment to reflect                                case-mix that is due to changes in the                         increase in the deductible generates
                                              changes in real case-mix, we first                                    mix of cases in the hospital and not due                       increases in the coinsurance amounts.
                                              calculated an average case-mix for each                               to coding optimization. We expect that                         For inpatient hospital and extended care
                                              hospital that reflects the relative                                   all of the change in average case-mix                          services furnished in CY 2016, in
                                              costliness of that hospital’s mix of cases                            will be real and estimate that this                            accordance with the fixed percentages
                                              compared to those of other hospitals.                                 change will be 0.5 percent.                                    defined in the law, the daily
                                              We then computed the change in                                           Thus as stated above, the estimate of
                                                                                                                                                                                   coinsurance for the 61st through 90th
                                              average case-mix for hospitals paid                                   the payment-weighted average of the
                                              under the Medicare prospective                                        applicable percentage increases used for                       day of hospitalization in a benefit
                                              payment system in FY 2015 compared                                    updating the payment rates is 1.72                             period will be $322 (one-fourth of the
                                              to FY 2014. (We excluded from this                                    percent, and the real case-mix                                 inpatient hospital deductible as stated
                                              calculation hospitals whose payments                                  adjustment factor for the deductible is                        in section 1813(a)(1)(A) of the Act); the
                                              are not based on the inpatient                                        0.5 percent. Therefore, using the                              daily coinsurance for lifetime reserve
                                              prospective payment system because                                    statutory formula as stated in section                         days will be $644 (one-half of the
                                              their payments are based on alternate                                 1813(b) of the Act, we calculate the                           inpatient hospital deductible as stated
                                              prospective payment systems or                                        inpatient hospital deductible for                              in section 1813(a)(1)(B) of the Act); and
                                              reasonable costs.) We used Medicare                                   services furnished in CY 2016 to be                            the daily coinsurance for the 21st
                                              bills from prospective payment                                        $1,288. This deductible amount is                              through 100th day of extended care
                                              hospitals that we received as of July                                 determined by multiplying $1,260 (the                          services in a skilled nursing facility in
                                              2015. These bills represent a total of                                inpatient hospital deductible for CY                           a benefit period will be $161 (one-eighth
                                              about 7.6 million Medicare discharges                                 2015 (79 FR 49854)) by the payment-                            of the inpatient hospital deductible as
                                              for FY 2015 and provide the most recent                               weighted average increase in the                               stated in section 1813(a)(3) of the Act).
                                              case-mix data available at this time.                                 payment rates of 1.0172 multiplied by
                                              Based on these bills, the change in                                   the increase in real case-mix of 1.005,                        IV. Cost to Medicare Beneficiaries
                                              average case-mix in FY 2015 is 0.21                                   which equals $1,288.08 and is rounded
                                              percent. Based on these bills and past                                                                                                 Table 1 below summarizes the
                                                                                                                    to $1,288.
                                              experience, we expect the overall case                                                                                               deductible and coinsurance amounts for
                                              mix change to be 0.5 percent as the year                              III. Computing the Inpatient Hospital                          CYs 2015 and 2016, as well as the
                                              progresses and more FY 2015 data                                      and Extended Care Services                                     number of each that is estimated to be
                                              become available.                                                     Coinsurance Amounts for CY 2016                                paid.
                                                Section 1813 of the Act requires that                                  The coinsurance amounts provided
                                              the inpatient hospital deductible be                                  for in section 1813 of the Act are

                                                  TABLE 1—PART A DEDUCTIBLE AND COINSURANCE AMOUNTS FOR CALENDAR YEARS 2015 AND 2016 TYPE OF COST
                                                                                              SHARING
                                                                                                                                                                           Value                       Number paid
                                                                                                                                                                                                       (in millions)
                                                                                                                                                                    2015            2016            2015               2016

                                              Inpatient hospital deductible ............................................................................              $1260               $1288          7.73              7.75
                                              Daily coinsurance for 61st–90th Day ...............................................................                       315                 322          1.83              1.83
                                              Daily coinsurance for lifetime reserve days .....................................................                          630                644          0.89              0.89
                                              SNF coinsurance .............................................................................................           157.50                161         41.47             42.67



                                                 The estimated total increase in costs                              amounts—the hospital and extended                                We considered publishing a proposed
                                              to beneficiaries is about $610 million                                care services coinsurance amounts—                             notice to provide a period for public
                                              (rounded to the nearest $10 million) due                              between September 1 and September 15                           comment. However, we may waive that
                                              to: (1) The increase in the deductible                                of the year preceding the year to which                        procedure if we find good cause that
                                              and coinsurance amounts, and (2) the                                  they will apply. These amounts are                             prior notice and comment are
                                              increase in the number of deductibles                                 determined according to the statute as                         impracticable, unnecessary, or contrary
                                              and daily coinsurance amounts paid.                                   discussed above. As has been our                               to the public interest. We find that the
                                              We determine the increase in cost to                                  custom, we use general notices, rather                         procedure for notice and comment is
                                              beneficiaries by calculating the                                      than notice and comment rulemaking                             unnecessary here, because the formulae
                                              difference between the 2015 and 2016                                  procedures, to make the                                        used to calculate the inpatient hospital
                                              deductible and coinsurance amounts
                                                                                                                    announcements. In doing so, we                                 deductible and hospital and extended
                                              multiplied by the increase in the
                                                                                                                    acknowledge that under the                                     care services coinsurance amounts are
                                              number of deductible and coinsurance
                                                                                                                    Administrative Procedure Act (APA),                            statutorily directed, and we can exercise
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                                              amounts paid.
                                                                                                                    interpretive rules, general statements of                      no discretion in following the formulae.
                                              V. Waiver of Proposed Notice and                                      policy, and rules of agency organization,                      Moreover, the statute establishes the
                                              Comment Period                                                        procedure, or practice are excepted from                       time period for which the deductible
                                                Section 1813(b)(2) of the Act requires                              the requirements of notice and comment                         and coinsurance amounts will apply
                                              publication of the inpatient hospital                                 rulemaking.                                                    and delaying publication would be
                                              deductible and all coinsurance                                                                                                       contrary to the public interest.


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                                              70810                      Federal Register / Vol. 80, No. 220 / Monday, November 16, 2015 / Notices

                                              Therefore, we find good cause to waive                  Review Act. In accordance with the                      Executive Order 13132 establishes
                                              publication of a proposed notice and                    provisions of Executive Order 12866,                  certain requirements that an agency
                                              solicitation of public comments.                        this notice was reviewed by the Office                must meet when it promulgates a
                                                                                                      of Management and Budget.                             proposed rule (and subsequent final
                                              VI. Collection of Information                              The RFA requires agencies to analyze               rule) that imposes substantial direct
                                              Requirements                                            options for regulatory relief of small                requirement costs on state and local
                                                This document does not impose                         entities, if a rule has a significant impact          governments, preempts state law, or
                                              information collection requirements,                    on a substantial number of small                      otherwise has Federalism implications.
                                              that is, reporting, recordkeeping or                    entities. For purposes of the RFA, small              Since this notice does not impose any
                                              third-party disclosure requirements.                    entities include small businesses,                    costs on state or local governments,
                                              Consequently, there is no need for                      nonprofit organizations, and small                    preempt state law, or have Federalism
                                              review by the Office of Management and                  governmental jurisdictions. Most                      implications, the requirements of
                                              Budget under the authority of the                       hospitals and most other providers and                Executive Order 13132 are not
                                              Paperwork Reduction Act of 1995 (44                     suppliers are small entities, either by               applicable.
                                              U.S.C. 3501 et seq.).                                   nonprofit status or by having revenues
                                                                                                                                                              Dated: November 6, 2015.
                                                                                                      of less than $7.5 million to $38.5
                                              VII. Regulatory Impact Analysis                         million in any 1 year (for details, see the           Andrew M. Slavitt,
                                                                                                      Small Business Administration’s Web                   Acting Administrator, Centers for Medicare
                                              A. Statement of Need
                                                                                                      site at http://www.sba.gov/sites/default/             & Medicaid Services.
                                                Section 1813(b)(2) of the Act requires                files/files/Size_Standards_Table.pdf).                  Dated: November 9, 2015.
                                              the Secretary to publish, between                       Individuals and states are not included               Sylvia M. Burwell,
                                              September 1 and September 15 of each                    in the definition of a small entity. As               Secretary, Department of Health and Human
                                              year, the amounts of the inpatient                      discussed above, this annual notice                   Services.
                                              hospital deductible and hospital and                    announces the inpatient hospital                      [FR Doc. 2015–29207 Filed 11–10–15; 4:15 pm]
                                              extended care services coinsurance                      deductible and the hospital and                       BILLING CODE 4120–01–P
                                              applicable for services furnished in the                extended care services coinsurance
                                              following calendar year (CY).                           amounts for services furnished in CY
                                              B. Overall Impact                                       2016 under Medicare’s Hospital                        DEPARTMENT OF HEALTH AND
                                                                                                      Insurance Program (Medicare Part A).                  HUMAN SERVICES
                                                 We have examined the impact of this                  As a result, we are not preparing an
                                              rule as required by Executive Order                     analysis for the RFA because the                      Centers for Medicare & Medicaid
                                              12866 on Regulatory Planning and                        Secretary has determined that this                    Services
                                              Review (September 30, 1993), Executive                  notice will not have a significant
                                              Order 13563 on Improving Regulation                     economic impact on a substantial                      [Document Identifiers: CMS–2567 and CMS–
                                              and Regulatory Review (January 18,                      number of small entities.                             10143]
                                              2011), the Regulatory Flexibility Act                      In addition, section 1102(b) of the
                                              (RFA) (September 19, 1980, Pub. L. 96–                  Social Security Act requires us to                    Agency Information Collection
                                              354), section 1102(b) of the Social                     prepare a regulatory impact analysis if               Activities: Submission for OMB
                                              Security Act, section 202 of the                        a rule may have a significant impact on               Review; Comment Request
                                              Unfunded Mandates Reform Act of 1995                    the operations of a substantial number
                                              (March 22, 1995; Pub. L. 104–4),                        of small rural hospitals. This analysis               ACTION:   Notice.
                                              Executive Order 13132 on Federalism                     must conform to the provisions of
                                              (August 4, 1999) and the Congressional                  section 604 of the RFA. For purposes of               SUMMARY:    The Centers for Medicare &
                                              Review Act (5 U.S.C., Part I, Ch. 8).                   section 1102(b) of the Act, we define a               Medicaid Services (CMS) is announcing
                                                 Executive Orders 12866 and 13563                     small rural hospital as a hospital that is            an opportunity for the public to
                                              direct agencies to assess all costs and                 located outside of a Metropolitan                     comment on CMS’ intention to collect
                                              benefits of available regulatory                        Statistical Area for Medicare payment                 information from the public. Under the
                                              alternatives and, if regulation is                      regulations and has fewer than 100                    Paperwork Reduction Act of 1995
                                              necessary, to select regulatory                         beds. As discussed above, we are not                  (PRA), federal agencies are required to
                                              approaches that maximize net benefits                   preparing an analysis for section 1102(b)             publish notice in the Federal Register
                                              (including potential economic,                          of the Act because the Secretary has                  concerning each proposed collection of
                                              environmental, public health and safety                 determined that this notice will not                  information, including each proposed
                                              effects, distributive impacts, and                      have a significant impact on the                      extension or reinstatement of an existing
                                              equity). A regulatory impact analysis                   operations of a substantial number of                 collection of information, and to allow
                                              (RIA) must be prepared for major                        small rural hospitals.                                a second opportunity for public
                                              notices with economically significant                      Section 202 of the Unfunded                        comment on the notice. Interested
                                              effects ($100 million or more in any 1                  Mandates Reform Act of 1995 also                      persons are invited to send comments
                                              year). As stated in section IV of this                  requires that agencies assess anticipated             regarding the burden estimate or any
                                              notice, we estimate that the total                      costs and benefits before issuing any                 other aspect of this collection of
                                              increase in costs to beneficiaries                      rule whose mandates require spending                  information, including any of the
                                              associated with this notice is about $610               in any 1 year of $100 million in 1995                 following subjects: (1) The necessity and
                                              million due to: (1) The increase in the                 dollars, updated annually for inflation.              utility of the proposed information
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                                              deductible and coinsurance amounts,                     For 2015, that threshold accounting for               collection for the proper performance of
                                              and (2) the increase in the number of                   inflation is approximately $144 million.              the agency’s functions; (2) the accuracy
                                              deductibles and daily coinsurance                       This notice does not impose mandates                  of the estimated burden; (3) ways to
                                              amounts paid. As a result, this notice is               that will have a consequential effect of              enhance the quality, utility, and clarity
                                              economically significant under section                  $144 million or more on state, local, or              of the information to be collected; and
                                              3(f)(1) of Executive Order 12866 and is                 tribal governments or on the private                  (4) the use of automated collection
                                              a major action under the Congressional                  sector.                                               techniques or other forms of information


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Document Created: 2015-12-14 14:13:21
Document Modified: 2015-12-14 14:13:21
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
ActionNotice.
ContactClare McFarland, (410) 786-6390 for general information. Gregory J. Savord, (410) 786-1521 for case-mix analysis.
FR Citation80 FR 70808 
RIN Number0938-AS36

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