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The Proposed Medicare Outpatient Prospective

Payment System (OPPS) Rule for CY 2011



The proposed CY 2011 OPPS rule implements changes mandated by the Affordable Care Act (ACA) as to how the Medicare program will reimburse for Medicare Graduate Education (GME) under the Inpatient Prospective Payment System (IPPS). Below is summary outline of the proposed changes:

Affordable Care Act (ACA) of 2010 - Mandates:

GME/IME Changes

Centers for Medicare & Medicaid Services (CMS) will mandate that the count for all time spent by GME residents in a non-provider setting will be assigned towards GME and Indirect Medical Education (IME) costs if the provider incurs the costs of the residents wages and fringe benefits. For cost reporting periods beginning on or after July 1, 2010, all time spent by a resident would count toward the GME payment without regard to the setting where the work was performed, if the hospital continues, (or in the case of jointly operated residency program, the involved entities continue) to incur the costs of the wage (stipend) and the fringe benefits of the resident during the time the resident spends in the assigned setting.

Effective for discharges on or after July 1, 2010, all the time spent by a resident in patient care areas in a non-hospital setting would be counted towards indirect GME payment if the provider continues, (or in the case of a jointly operated residency program, the involved entities continue) to incur costs of the stipends and the fringe benefits of the resident during the time the resident spends in the assigned setting

Redistribution of Unused GME Residency Slots

CMS will begin to redistribute unused medical residency slots that have been vacant during a prior cost reporting period to other hospitals, beginning with cost reporting periods occurring on or after July 1, 2011. The CMS policy to redistribute unused resident slots will encourage training for primary and general surgery residents.

With regard to the general distribution of unused GME positions, ACA generally requires CMS to take 65% of a hospital's unused Medicare funded GME positions and redistribute them according to priorities established by Congress. To receive resident positions, hospitals must demonstrate a likelihood of filling the new positions within three years and must use 75% of the new positions for primary training or general surgery while maintaining the hospital's current load of primary care positions.

The HHS Secretary would be required to increase the resident limit for each qualifying hospital submitting a timely application request. Hospitals receiving an increase would be required to ensure that the number of FTE residents in primary care residency is not less than the average during the 3 most recent cost reporting periods and not less than 75% of the positions attributable to such an increase are in a primary care or general surgery residency.

The health reform law specifies that 70% of the unused slots must be redistributed to hospitals in states with resident-to-population ratios in the lowest quartile, and CMS proposes that these states are: Florida, Georgia, Montana, Idaho, Alaska, Wyoming, Nevada, South Dakota, North Dakota, Mississippi, Puerto Rico, Indiana, and Arizona. In addition, the health reform law requires CMS to allocate the remaining 30% of the redistributed slots to hospitals in rural areas and to hospitals located in the 10 states with the highest proportion of their populations living in a health professional shortage area.

The proposed deadline for hospitals to apply for redistributed slots is December 1, 2010.
The ability of hospitals applying for new positions demonstrate a likelihood of filling positions is the first criterion CMS will use in screening applications. If resident slots are left in the distribution pool after the first round of hospital applications, CMS will initiate an additional round of applications after July 1, 2011, using the same redistribution criteria as was done in the first round.

Rules for Counting Resident Time for Didactic and Scholarly Activities and Other Activities

CMS proposes to allow hospitals to count resident time spent in certain non-patient care activities (including didactic conferences and seminars) while training in certain non-hospital settings for GME purposes, effective for cost reporting periods beginning on or after July 1, 2009. When calculating direct GME payments, Medicare would count the time that residents in approved training programs spend in certain non-patient care activities in a non-hospital setting that is primarily engaged in furnishing patient care; this would include time spent in didactic conferences and seminars. CMS states its intention to continue disallowing time for conferences and seminars held in non-hospital, non-patient care venues, including medical school buildings.

Preservation of Resident Cap Positions from Closed and Acquired Hospitals

The HHS Secretary would promulgate regulations to establish a process where residency allotments in a hospital with an approved medical residency program that closes could be used to increase the residency limit for other hospitals. The transferable residency slots from closed hospitals, requires CMS to redistribute permanently the GME and IME residency slots from the closed hospital on or after March 23, 2008. Currently, hospitals may receive temporary cap slots for training displaced residents from the closed hospital. CMS included proposed applications for closed hospital resident slot redistribution programs in its rule.


Link References

CMS-GMEregs-2010-16448_P1 (Page 1-825)
CMS-GMEregs-2010-16448_P1 (Page 826-1650)
US Congress Public Law 111-148 ( See, Sections 5501 - 5509)
US Congress Public Law 111-152