Section 471-46-003 - PAYMENT FOR PEER GROUPS 1, 2, AND 3 METRO ACUTE, OTHER URBAN ACUTE, AND RURAL ACUTEPayments for acute care services are made on a prospective per discharge basis, except hospitals certified as a critical access hospital. For inpatient services that are classified into a diagnosis related group, the total per discharge payment is the sum of the operating cost payment amount; the capital-related cost payment; and when applicable direct medical education cost payment; indirect medical education cost payment; and a cost outlier payment. For inpatient services that are classified into a transplant diagnosis related group, the total per discharge payment is the sum of the cost-to-charge ratio payment amount; and when applicable direct medical education cost payment.
003.01DETERMINATION OF OPERATING COST PAYMENT AMOUNT. The hospital diagnosis related group operating cost payment amount for discharges that are classified into a diagnosis related group is calculated by multiplying the peer group base payment amount by the applicable national relative weight. 003.01(A)CALCULATION OF THE APR-DIAGNOSIS RELATED GROUP WEIGHTS. For dates of service on or after July 1, 2014, the Department will use the All-Patient Refined Diagnosis Related Groups classifications. The National Weights published by 3M will be applied to the all patient refined-diagnosis related groups. The National Weights are calculated using the nationwide inpatient sample released by the healthcare cost and utilization project. The Department will annually update the all patient refined-diagnosis related group grouper and national relative weights with the most current available version.003.01(B)CALCULATION OF NEBRASKA PEER GROUP BASE PAYMENT AMOUNTS. Peer group base payment amounts are used to calculate payments for discharges with a diagnosis related group. Peer group base payment amounts effective July 1, 2016, are calculated for peer group 1, 2 and 3 hospitals based on the peer group base payment amounts effective during state fiscal year 2011, adjusted for budget neutrality, calculated as follows: peer group 1 base payment amounts, excluding children's hospitals: multiply the state fiscal year 2011 peer group 1 base payment amount of $4,397.00 by the diagnosis related group budget neutrality factor. Children's hospital peer group 1 base payment amounts: multiply the state fiscal year 2011 children's hospital peer group 1 base payment amount of $5,278.00 by the diagnosis related group budget neutrality factor. Peer group 2 base payment amounts: multiply the state fiscal year 2011 peer group 2 base payment amount of $4,270.00 by the diagnosis related group budget neutrality factor. Peer group 3 base payment amounts: multiply the state fiscal year 2011 peer group 3 base payment amount of $4,044.00 by the diagnosis related group budget neutrality factor. State fiscal year 2007 Nebraska peer group base payment amounts are described in this chapter. Peer group base payment amounts excluding the 0.5% increase for the rate period beginning October 1, 2009 and ending June 30, 2010, will be increased by.5% for the rate period beginning July 1, 2010. The peer group base payment amount is subject to annual adjustment as specified by the Department.003.02CALCULATION OF DIAGNOSIS RELATED GROUP COST OUTLIER PAYMENT AMOUNTS. Additional payment is made for approved discharges classified into a diagnosis related group meeting or exceeding Medicaid criteria for cost outliers for each diagnosis related group classification. Cost outliers may be subject to medical review. Discharges qualify as cost outliers when the costs of the service exceed the outlier threshold. The outlier threshold is the sum of the operating cost payment amount, the indirect medical education amount, and the capital-related cost payment amount, plus $30,000 for all neonate and nervous system all patient refined-diagnosis related groups at severity level 3 and at severity level 4. For all other all patient refined-diagnosis related groups, the outlier threshold is the sum of the operating cost payment amount, the indirect medical education amount, and the capital-related cost payment amount, plus $51,800. Cost of the discharge is calculated by multiplying the Medicaid allowed charges by the sum of the hospital specific Medicare operating and capital outlier cost-to-charge ratios. Additional payment for cost outliers is 80% of the difference between the hospital's cost for the discharge and the outlier threshold for all discharges except for burn discharges, which will be paid at 85% of the difference between the hospital's cost for the discharge and the outlier threshold. 003.02(A)HOSPITAL SPECIFIC MEDICARE OUTLIER CCRS. The Department will extract from the Center for Medicaid and Medicaid Services Prospective Payment System Inpatient Pricer Program the hospital-specific Medicare operating and capital outlier cost-to-charge ratios effective October 1 of the year preceding the start of the Nebraska rate year.003.02(B)OUTLIER CCRS UPDATES. On July 1 of each year, the Department will update the outlier costs based on the Medicare outlier cost-to-charge ratios effective October 1 of the previous year.003.03CALCULATION OF MEDICAL EDUCATION COSTS.003.03(A)CALCULATION OF DIRECT MEDICAL EDUCATION COST PAYMENTS. Direct Medical Education payments effective October 1, 2009 are based on Nebraska hospital-specific direct medical education payment rates effective during state fiscal year 2007 with the following adjustments: Estimate state fiscal year 2007 direct medical education payments for in-state teaching hospitals by applying state fiscal year 2007 direct medical education payment rates to state fiscal year 2007 Nebraska Medicaid inpatient fee-for-service paid claims data. Include all patient refined-diagnosis related group discharges except psychiatric, rehabilitation and Medicaid Capitated Plans discharges. Divide the estimated state fiscal year 2007 direct medical education payments for each hospital by each hospital's number of intern and resident full time equivalents effective in the Medicare system on October 1, 2006. Multiply the state fiscal year 2007 direct medical education payment per intern and resident full time equivalent by each hospital's number of intern and resident full time equivalents effective in the Medicare inpatient system on October 1, 2008. Divide the direct medical education payments adjusted for full time equivalents effective October 1, 2008 by each hospital's number of state fiscal year 2007 claims. Multiply the direct medical education payment rates by the stable diagnosis related group budget neutrality factor. On July 1st of each year, the Department will update direct medical education payment rates by replacing each hospital's intern and resident full time equivalents effective in the Medicare inpatient system on October 1, 2008, as described in step 3 of this subsection, with each hospital's intern and resident full time equivalents effective in the Medicare inpatient system on October 1 of the previous year. The direct medical education payment amount will be increased by 0.5% effective October 1, 2009 through June 30, 2010. This rate increase will not be carried forward in subsequent years. The direct medical education payment amount, excluding the 0.5% increase effective October 1, 2009 through June 30, 2009, will be increased by.5% for the rate period beginning July 1, 2010. The direct medical education payment amount is subject to annual adjustment as specified by the Department.003.03(B)CALCULATION OF INDIRECT MEDICAL EDUCATION COST PAYMENTS. Hospitals qualify for indirect medical education payments when they receive a direct medical education payment from Medicaid, and qualify for indirect medical education payments from Medicare. Recognition of indirect medical education costs incurred by hospitals are an add-on calculated by multiplying an indirect medial education factor by the operating cost payment amount. The indirect medical education factor is the Medicare inpatient prospective payment system operating indirect medial education factor effective October 1 of the year preceding the beginning of the Nebraska rate year. The operating indirect medical education factor shall be determined using data extracted from the Center for Medicare and Medicaid Services Prospective Payment System Inpatient Pricer Program using the following formula: Number of interns and residents divided by available beds; plus 1; to the power of 0.405; minus 1; multiplied by 1.35.003.03(C)CALCULATION OF MANAGED CARE ORGANIZATION MEDICAL EDUCATION PAYMENTS. Medicaid will calculate annual MCO Direct Medical Education payments and managed care organization indirect medical education payments for services provided by Medicaid capitated plans from discharge data provided by the managed care organization. Managed care organization direct medical education payments will be equal to the number of managed care organization discharges times the fee-for service direct medical education payment per discharge in effect for the rate year July 1 through June 30. Managed care organization indirect medical education payments will be equal to the number of managed care organization discharges times the managed care organization indirect medical education payment per discharge. The indirect medical education payment per discharge is calculated as follows. Subtotal each teaching hospital's fee-for-service inpatient acute indirect medical education prior year payments. Subtotal each teaching hospital's fee-for-service inpatient covered prior state fiscal year charges. Divide each teaching hospital's indirect medical education payments, by covered prior state fiscal year charges. Multiply this ratio times the covered charges in managed care organization paid claims in the base year. Divide this amount by the number of managed care organization paid claims in the base year.003.03(D)CALCULATION OF CAPITAL-RELATED COST PAYMENT. Capital-related cost payments for the building and fixtures portion of capital-related costs are paid on a per discharge basis. Per discharge amounts are calculated by multiplying the capital per diem cost by the statewide average length-of-stay for the diagnosis related group. Capital-related payment per diem amounts effective July 1, 2009 are calculated for Peer Group 1, 2 and 3 hospitals based on the capital-related payment per diem amounts effective during state fiscal year 2007, adjusted for budget neutrality, as follows: Peer Group 1 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 1 Capital-related payment per diem amount of $ 36.00 by the Stable diagnosis related group budget neutrality factor. Peer Group 2 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 2 Capital-related payment per diem amount of $ 31.00 by the stable diagnosis related group budget neutrality factor. Peer Group 3 Capital-Related Payment Per Diem Amounts: Multiply the state fiscal year 2007 Peer Group 3 Capital-related payment per diem amount of $ 18.00 by the Stable diagnosis related group budget neutrality factor. Capital Related Per Diem Amounts are subject to annual adjustments as specified by the Department.003.03(E)TRANSPLANT DIAGNOSIS RELATED GROUP PAYMENTS. Transplant discharges, identified as discharges that are classified to a transplant diagnosis related group, are paid a transplant diagnosis related group cost-to-charge ratio payment and, if applicable, a direct medical education payment. Transplant diagnosis related group discharges do not receive separate cost outlier payments, independent medical examination cost payments or capital-related cost payments. 003.03(E)(i)TRANSPLANT DIAGNOSIS RELATED GROUP COST-TO-CHARGE RATIO PAYMENTS. Transplant diagnosis related group cost-to-charge ratio payments are calculated by multiplying the hospital-specific transplant diagnosis related group cost-to-charge ratio by Medicaid allowed claim charges. Transplant diagnosis related group cost-to-charge ratio are calculated as follows: Extract from the centers for Medicare and Medicaid services prospective payment system Inpatient pricer program for each hospital the Medicare inpatient prospective payment system operating and capital outlier cost to charge effective October 1 of the year preceding the beginning of the Nebraska rate year. For rates effective October 1, 2009, the Department will extract the outlier cost-to-charge ratio in effect for the Medicare system on October 1, 2008; sum the operating and capital outlier cost-to-charge ratio; multiply the sum of the operating and capital outlier cost-to-charge ratios by the transplant diagnosis related group budget neutrality factor. On July 1 of each year, the Department will update the Transplant diagnosis related group cost-to-charge ratios based on the percentage change in Medicare outlier cost-to-charge ratios effective October 1 of the two previous years, before budget neutrality adjustments. Effective July 1, 2011, the transplant diagnosis related group cost-to-charge ratios will be reduced by 2.5%. Effective July 1, 2012, the transplant diagnosis related group cost-to-charge ratios will be increased by 1.54%. Effective July 1, 2013, the transplant diagnosis related group cost-to-charge ratios will be increased by 2.25%. Effective July 1, 2014, the transplant diagnosis related group cost-to-charge ratios will be increased by 2.25%. Effective July 1, 2015, the transplant diagnosis related group cost-to-charge ratios will be increased by 2%. Effective July 1, 2016, the transplant diagnosis related group cost-to-charge ratios will be increased by 2%. Effective July 31, 2019, the transplant diagnosis related group cost-to-charge ratios will be increased by 2%. Effective July 1, 2020, the transplant diagnosis related group cost-to-charge ratios will be increased by 2%.003.03(E)(ii)TRANSPLANT DIAGNOSIS RELATED GROUP DIRECT MEDICAL EDUCATION PAYMENTS. Transplant diagnosis related group direct medical education payments are calculated using the same methodology described in subsection this chapter, with the exception that in step 4, direct medical education per discharge payment amounts are adjusted by the transplant diagnosis related group budget neutrality factor. On July 1st of each year, the Department will update transplant direct medical education payment per discharge rates as described in this regulation. On July 1st of each year, the Department will update transplant diagnosis related group direct medical education payment per discharge rates as described in this chapter.003.03(F)BUDGET NEUTRALITY FACTORS. Peer Group Base Payment Amounts, are multiplied by budget neutrality factors, determined as follows: 003.03(F)(i)DEVELOP FISCAL SIMULATION ANALYSIS. The Department will develop a fiscal simulation analysis using Medicaid inpatient fee-for-service paid claims data from state fiscal year 2011. The fiscal simulation analysis includes discharges grouped into a diagnosis related group and excludes all psychiatric, rehabilitation and transplant discharges. In the fiscal simulation analysis, the Department will apply all rate year payment rates before budget neutrality adjustments to the claims data and simulate payments.003.03(F)(ii)DETERMINE BUDGET NEUTRALITY FACTORS. The Department will set budget neutrality factors in fiscal simulation analysis such that simulated payments are equal to the claims data reported payments, inflated by Peer Group Base Payment Amount increases approved by the Department from the end of the claims data period to the rate year. For rates effective July 1, 2014, the Department will inflate the state fiscal year 2011 base rates by 61.05%.003.03(G)FACILITY SPECIFIC UPPER PAYMENT LIMIT. Facilities in Peer Groups 1, 2, and 3 are subject to an upper payment limit for all cost reporting periods ending after January 1, 2001. For each cost reporting period, Medicaid payment for inpatient hospital services shall not exceed 110% of Medicaid cost. Medicaid cost shall be the calculated sum of Medicaid allowable inpatient routine and ancillary service costs. Medicaid routine service costs are calculated by allocating total hospital routine service costs for each applicable routine service cost center Medicaid inpatient ancillary service costs are calculated by multiplying an overall ancillary cost-to-charge ratio times the applicable Medicaid program inpatient ancillary charges. The overall ancillary cost-to-charge ratio is calculated by dividing the sum of the costs of all ancillary and outpatient service cost centers by the sum of the charges for all ancillary and outpatient service cost centers. Payments shall include all operating cost payments, capital related cost payments, direct medical education cost payments, indirect medical education cost payments, cost outlier payments, and all payments received from other sources for hospital care provided to Medicaid eligible patients. Payment under Medicaid shall constitute reimbursements under this subsection for days of service that occurred during the cost reporting period. 003.03(G)(i)RECONCILIATION TO FACILITY UPPER PAYMENT LIMIT. Facilities will be subject to a preliminary and a final reconciliation of Medicaid payments to allowable Medicaid costs. A preliminary reconciliation will be made within six months following receipt by the Department of the facility's cost report. A reconciliation will be made within 6 months following receipt by the Department of the facilities settled cost report. Facilities will be notified when either the preliminary or final reconciliation indicates that the facility received Medicaid payments in excess of 110% of Medicaid costs. The Department will identify the cost reporting time period for Medicaid payments, Medicaid costs, and the amount of overpayment that is due the Department. Facilities will have 90 days to make refunds to the Department, when notified that an overpayment has occurred.003.03(H)TRANSFERS. When a patient is transferred to or from another hospital, the Department shall make a transfer payment to the transferring hospital if the initial admission is determined to be medically necessary. For hospital inpatient services reimbursed on a prospective discharge basis, the transfer payment is calculated based on the average daily rate of the transferring hospital's payment for each day the patient remains in that hospital, up to 100 % of the full diagnosis related group payment. The average daily rate is calculated as the full diagnosis related group payment, which is the sum of the operating cost payment amount, capital-related cost payment, and if applicable, direct medical education cost payment, divided by the statewide average length-of-stay for the related diagnosis related group. For hospitals receiving a transferred patient, payment is the full diagnosis related group payment and, if applicable, cost outlier payment.003.03(I)INPATIENT ADMISSION AFTER OUTPATIENT SERVICES. A patient may be admitted to the hospital as an inpatient after receiving hospital outpatient services. When a patient is admitted as an inpatient within three calendar days of the day that the hospital outpatient services were provided, all hospital outpatient services related to the principal diagnosis are considered inpatient services for billing and payment purposes. The day of the admission as an inpatient is the first day of the inpatient hospitalization.003.03(J)READMISSIONS. Medicaid adopts Medicare peer review organization regulations to control increased admissions or reduced services. All Medicaid patients readmitted as an inpatient within 31 days will be reviewed by the Department or its designee. Payment may be denied if either admissions or discharges are performed without medical justification as determined medical review.003.03(K)INTERIM PAYMENT FOR LONG-STAY PATIENTS. Medicaid's payment for hospital inpatient services is made upon the patient's discharge from the hospital. Occasionally, a patient may have an extremely long stay, in which partial reimbursement to the hospital may be necessary. A hospital may request an interim payment if the patient has been hospitalized 60 days and is expected to remain hospitalized an additional 60 days. To request an interim payment, the hospital shall send a completed Form HCFA-1450, UB-92, for the hospital days for which the interim payment is being requested with an attestation by the attending physician that the patient has been hospitalized a minimum of 60 days and is expected to remain hospitalized a minimum of an additional 60 days. The hospital shall send the request for interim payment to the Department of Health and Human Services Finance and Support. The hospital will be notified in writing if the request for interim payment is denied. 003.03(K)(i)FINAL PAYMENT FOR LONG-STAY PATIENT. When an interim payment is made for long-stay patients, the hospital shall submit a final billing for payment upon discharge of the patient. The date of admission for the final billing must be the date the patient was admitted to the hospital as an inpatient. The statement from and to dates must be the date the patient was admitted to the hospital through the date the patient was discharged. The total charges must be all charges incurred during the hospitalization. Payment for the entire hospitalization will be calculated at the same rate as all prospective discharge payments. The final payment will be reduced by the amount of the interim payment.003.03(L)PAYMENT FOR NON-PHYSICIAN ANESTHETIST FEES. Hospitals which meet the Medicare exception for payment of certified registered nurse anesthetist fees as a pass-through by Medicare will be paid for certified registered nurse anesthetist fees in addition to their prospective per discharge payment. The additional payment will equal 85% of the hospital's costs for certified registered nurse anesthetist services. Costs will be calculated using the hospital's specific anesthesia cost-to-charge ratio. Certified registered nurse anesthetist fees must be billed using revenue code 964 - Professional Fees Anesthetist on the HCFA-1450, UB-92, claim form.471 Neb. Admin. Code, ch. 46, § 003
Adopted effective 6/6/2022