Published October 28, 2010

Wage Index Deadlines Fast Approaching

Occupational Mix Survey

Hospitals subject to the inpatient prospective payment system (“IPPS”) are required to submit an occupational mix survey for pay periods ending between July 1, 2007 and June 30, 2008 by September 2, 2008. This survey provides for the collection of hospital-specific wages and hours used in computing the occupational mix adjustment to the hospital wage index. This survey must be completed for full-time and part-time employees, as well as labor services acquired under contract. The data may be submitted to fiscal intermediaries via e-mail attachment or overnight delivery.

Please note that the occupational mix data should coincide with the wage index information and cost report groupings reported on the Medicare cost report. In addition, salaries and hours for related organizations and general services that should be allocated to excluded areas such as skilled nursing facilities, psychiatric units, rehab units, etc., should also be excluded from the occupational mix survey.

Medicare Geographic Reclassification

Hospitals requesting geographic reclassification for wage index purposes for Federal fiscal years 2010 through 2012 must provide a completed application and supporting documentation to the Medicare Geographic Classification Review Board by 5:00 p.m. on September 2, 2008. The board does not accept applications submitted via facsimile or e-mail.

As reported in the recently published 2009 Hospital IPPS Final Rule, CMS has increased the requirement for a facility to qualify for geographic reclassification. For urban facilities, a hospital’s average hourly wage must be at least 86% of the average hourly wage of the area to which it seeks reclassification. This percentage is an increase from the previous requirement of 84%. Likewise, the percentage for rural facilities has increased from 82% to 84%. These regulatory increases will continue to be phased in next year to reach 88% for urban facilities and 86% for rural facilities. These changes to the reclassification criteria only apply to new reclassifications. Hospitals that have been previously granted 3-year geographic reclassifications are not affected by the new criteria until they reapply.

Again, the deadlines for the Occupational Mix Survey and the Medicare Geographic Reclassification Request are September 2, 2008.

If you would like additional information or assistance regarding these upcoming wage index requirements, contact one of our executives listed below, (800) 270-9629.

Interested in Learning More?

Sign Up for Our Latest Thought Leadership!



    Select Your Subscriptions