[Code of Federal Regulations]
[Title 42, Volume 2]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR412.90]

[Page 410-411]
 
                         TITLE 42--PUBLIC HEALTH
 
                             HUMAN SERVICES
 
PART 412--PROSPECTIVE PAYMENT SYSTEMS FOR INPATIENT HOSPITAL SERVICES--Table of Contents
 
Subpart G--Special Treatment of Certain Facilities Under the Prospective 
              Payment System for Inpatient Operating Costs
 
Sec. 412.90  General rules.


    (a) Sole community hospitals. CMS may adjust the prospective payment 
rates for inpatient operating costs determined under subpart D or E of 
this part if a hospital, by reason of factors such as isolated location, 
weather conditions, travel conditions, or absence of other hosptials, is 
the sole source of inpatient hospital services reasonably available in a 
geographic area to Medicare beneficiaries. If a hospital meets the 
criteria for such an exception under Sec. 412.92(a), its prospective 
payment rates for inpatient operating costs are determined under 
Sec. 412.92(d).
    (b) Referral center. CMS may adjust the prospective payment rates 
for inpatient operating costs determined under subpart D or E of this 
part if a hospital acts as a referral center for patients transferred 
from other hospitals. Criteria for identifying such referral centers are 
set forth in Sec. 412.96.
    (c) [Reserved]
    (d) Kidney acquisition costs incurred by hospitals approved as renal 
transplantation centers. CMS pays for kidney acquisition costs incurred 
by renal transplanation centers on a reasonable

[[Page 411]]

cost basis. The criteria for this special payment provision are set 
forth in Sec. 412.100.
    (e) Hospitals located in areas that are reclassified from urban to 
rural. (1) CMS adjusts the rural Federal payment amounts for inpatient 
operating costs for hospitals located in geographic areas that are 
reclassified from urban to rural as defined in Sec. 412.62(f). This 
adjustment is set forth in Sec. 412.102.
    (2) CMS establishes a procedure by which certain individual 
hospitals located in urban areas may apply for reclassification as 
rural. The criteria for reclassification are set forth in Sec. 412.103.
    (f) Hospitals that have a high percentage of ESRD beneficiary 
discharges. CMS makes an additional payment to a hospital if ten percent 
or more of its total Medicare discharges in a cost reporting period 
beginning on or after October 1, 1984 are ESRD beneficiary discharges. 
In determining ESRD discharges, discharges in DRG Nos. 302, 316, and 317 
are excluded. The criteria for this additional payment are set forth in 
Sec. 412.104.
    (g) Hosptials that incur indirect costs for graduate medical 
education programs. CMS makes an additional payment for inpatient 
operating costs to a hospital for indirect medical education costs 
attributable to an approved graduate medical education program. The 
criteria for this additional payment are set forth in Sec. 412.105.
    (h) Hospitals that serve a disproportionate share of low-income 
patients. For discharges occurring on or after May 1, 1986, CMS makes an 
additional payment for inpatient operating costs to hospitals that serve 
a disproportionate share of low-income patients. The criteria for this 
additional payment are set forth in Sec. 412.106.
    (i) Hospitals that receive an additional update for FYs 1998 and 
1999. For FYs 1998 and 1999, CMS makes an upward adjustment to the 
standardized amounts for certain hospitals that do not receive indirect 
medical education or disproportionate share payments and are not 
Medicare- dependent, small rural hospitals. The criteria for identifying 
these hospitals are set forth in Sec. 412.107.
    (j) Medicare-dependent, small rural hospitals. For cost reporting 
periods beginning on or after April 1, 1990 and before October 1, 1994, 
or beginning on or after October 1, 1997 and before October 1, 2006, CMS 
adjusts the prospective payment rates for inpatient operating costs 
determined under subparts D and E of this part if a hospital is 
classified as a Medicare-dependent, small rural hospital.
    (k) Essential access community hospitals (EACHs). If a hospital was 
designated as an EACH by CMS as described in Sec. 412.109(a) and is 
located in a rural area as defined in Sec. 412.109(b), CMS determines 
the prospective payment rate for that hospital, as it does for sole 
community hospitals, under Sec. 412.92(d).

[57 FR 39823, Sept. 1, 1992, as amended at 58 FR 30669, May 26, 1993; 62 
FR 46028, Aug. 29, 1997; 64 FR 67051, Nov. 30, 1999; 65 FR 47047, Aug. 
1, 2000]