Application Guidance - revised June 2006 as a result of Section 422 of the MMA

Application Guidance - revised June 2006 as a result of Section 422 of the MMA.doc

Children's Hospital Graduate Medical Eduction Program

Application Guidance - revised June 2006 as a result of Section 422 of the MMA

OMB: 0915-0247

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Bureau of Health Professions

Dear Applicant:

The Children’s Hospitals Graduate Medical Education Payment Program (CHGME PP) application package, which includes all applicable forms, guidance and instructions, is enclosed. It is very important to thoroughly read the detailed application guidance and instructions before completing the required application forms. The material contains information related to submission of both the initial and reconciliation applications. Additional copies of the application package may be obtained electronically via the CHGME PP website at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm.

Your completed application must be mailed following the guidance provided in the “Application Cycle and Deadlines” section of the attached package. Applications must be received by the stated deadlines to be considered for CHGME PP funding.

If you have questions regarding the application, please call the Graduate Medical Education Branch at 301-443-1058 or e-mail at [email protected].

Sincerely yours,

A. Michelle Snyder

Associate Administrator

Bureau of Health Professions

Enclosures

Children’s Hospitals Graduate Medical Education

Payment Program (CHGME PP) Application Package

Table of Contents

Section I: Overview of the CHGME PP
Introduction	6
Administration	7
Section II: Application Cycle and Deadlines
Initial Application	8
Interim Payment Determination and Disbursement (Based Upon the Initial Application)	9
Assessment of Resident FTE Counts Reported in Initial Applications	9
Reconciliation Application	10
Final Payment Determination and Disbursement (Based Upon the Reconciliation Application)	11
Electronic Availability of Application Materials	12
Section III: CHGME PP Application Forms
Cover Page with Public Burden Statement	13
HRSA 99: Demographic and Contact Information	14
HRSA 99-1: Determination of Weighted and Unweighted Resident FTE Counts	16
HRSA 99-2: Determination of Indirect Medical Education Data Related to the Teaching of Residents	20
HRSA 99-3: Certification	21
HRSA 99-4: Government Performance and Results Act Tables	27
HRSA 99-5: Application Checklist	29
Section IV: Hospital Eligibility
Eligibility Criteria	30
Changes in Eligibility	30
Section V: Payment Methodology
Payment Methodology	31
Section VI: Hospital Data Needed to Complete the CHGME PP Application
Data Sources for Children’s Hospitals that File Full MCRs	32
Data Sources for Children’s Hospitals that File Low- or No-Utilization MCRs	32
Data Sources for Children’s Hospitals that Have Not Completed Three (3) MCR Periods	33
Data Sources for Children’s Hospitals that Have Not Completed One (1) MCR Period	34
Section VII: Determining the Total Number of Resident Full-Time Equivalents
Cap and Cap Year	35
Adjustments to a Hospital’s Cap	35
Exceeding the Cap	38
Eligible Residency Programs (Approved Training Programs)	39
Eligible Residents	40
International Medical Graduates (IMGs)	40
Resident Full-Time Equivalent (FTE) Counts	41
Initial Residency Period (IRP)	41
Weighting of Resident FTE Counts	42
Where Residents are Counted	43
Hospital Complex	43
Non-Provider/Non-Hospital Settings and Written Agreements	43
Partial Resident Full-Time Equivalents (FTEs)	44
Research Time	45
Resident FTE Count Accuracy and Documentation	45
Section VIII: Special Instructions for Calculating Reductions and Increases to a Hospital’s 1996 Base Year Cap as a Result of §422 of the Medicare Modernization Act of 2003
Decrease to a Hospital’s 1996 Base Year Cap (§422 Cap Reduction)	47
Increase to a Hospital’s 1996 Base Year Cap (§422 Cap Increase)	47
Section IX: Special Instructions for Calculating Indirect Medical Education Payment Variables
Number of Inpatient Discharges	49
Case Mix Index	49
Number of Available Beds	50
Intern/Resident to Bed (IRB) Ratio	50
Section X: Special Calculation Instructions for Hospitals that Have Not Completed a Medicare Cost Reporting Period
Determining the Period of Eligibility	52
Calculating the Resident FTE Count for an Incomplete Cost Reporting Period	53
Calculating the Case Mix Index (CMI) for an Incomplete Cost Reporting Period	54
Calculating Discharges for an Incomplete Cost Reporting Period	54
Calculating the Bed Count for an Incomplete Cost Reporting Period	55
Calculating Inpatient Days for an Incomplete Cost Reporting Period	55
Calculating Outpatient Services for an Incomplete Cost Reporting Period	56
Section XI: CHGME PP Application Form Instructions
HRSA 99: Hospital Demographic and Contact Information	57
HRSA 99-1: Determination of Weighted and Unweighted Resident FTE Counts	58
HRSA 99-2: Determination of Indirect Medical Education Data Related to the Teaching of Residents	64
HRSA 99-3: Hospital Certification	66
HRSA 99-4: Government Performance and Results Act Tables	67
HRSA 99-5: Application Checklist	70
Section XII: References
Commonly Used Acronyms	71

Section I

Overview of the CHGME PP

Introduction

In 1999, Congress addressed the disparity of explicit graduate medical education (GME) funding between freestanding children’s teaching hospitals and other teaching hospitals by passing the Healthcare Research and Quality Act, which established the Children’s Hospitals Graduate Medical Education Payment Program (CHGME PP). The act was signed on December 6, 1999 and the legislation authorized the program for Federal fiscal year (FY) 2000 and FY 2001. On October 17, 2000, the Children’s Health Act of 2000 amended the Healthcare Research and Quality Act of 1999 extending the CHGME PP through FY 2005. On December 23, 2004, additional amendments under Public Law 108-490 were made to Section 340E of the Public Health Service Act affecting the CHGME PP.

There are more than 60 freestanding children’s teaching hospitals across the country that train about 30 percent of the Nation’s pediatricians, nearly half of pediatric sub-specialists, and provide valuable training for physicians in many other specialties. These are the physicians who care for America’s youngest population – its children. Almost 50 percent of the patient care that children’s teaching hospitals provide is for low-income children, including those covered by Medicaid and those who are uninsured. In addition, these hospitals are regional and national referral centers for very sick children, often serving as the only source of care for many critical pediatric services. More than 75 percent of inpatient care at children’s hospitals is devoted to children with one or more chronic conditions.

The CHGME PP provides a more adequate level of support for GME training in U.S. children’s teaching hospitals that have a separate Medicare provider number. These hospitals receive relatively little funding from Medicare for GME. Funding received by other teaching hospitals from Medicare was expected to exceed more than $8 billion in FY 2005.

The CHGME PP law authorized $280 million for payments in FY 2000, $285 million in FY 2001, and “such sums as necessary” for fiscal years 2002 through 2005. Congress appropriated $40 million for the program in FY 2000, $235 million in FY 2001, $285 million in FY 2002, $292 million in FY 2003, $305 million for FY 2004, and $303 million for FY 2005. For both FY 2004 and FY 2005 Congress implemented a rescission which reduced the total appropriated amounts. In FY 2005, the CHGME PP appropriation provided GME support to 60 children's hospitals in 31 states supporting more than 4,100 unweighted resident full-time equivalents (FTEs) training in these hospitals. Since the inception of this program, the program has disbursed more than $1.1 billion in Federal GME support to freestanding children’s teaching hospitals.

Administration

The CHGME PP is administered by the Graduate Medical Education Branch (GMEB) of the Division of Medicine and Dentistry (DMD), Bureau of Health Professions (BHPr), Health Resources and Services Administration (HRSA), Department of Health and Human Services (DHHS). The objective of the GMEB is to provide the assistance that freestanding children’s hospitals need to ensure a future pediatric workforce that will treat U.S. children.

Questions regarding the CHGME PP should be directed to the:

Department of Health and Human Services

Health Resources and Services Administration

Bureau of Health Professions

Division of Medicine and Dentistry

Graduate Medical Education Branch

Parklawn Building

5600 Fishers Lane Room 9A-05

Rockville, Maryland 20857

Telephone: 301-443-1058 Fax: 301-443-1879

Section II

Application Cycle and Deadlines

For hospitals to be considered for CHGME PP funding, they must comply with statutory eligibility requirements described herein and participate in the CHGME PP’s application cycle, which consists of specific processes for any given FY. These processes are guided by the CHGME PP’s statutes and are described below.

Initial Application

For children’s hospitals, meeting all statutory and eligibility requirements, to receive CHGME PP funding, they must submit a completed initial application for CHGME PP funding in accordance with the established deadlines noted below. During the initial application process, eligible children’s hospitals provide the CHGME PP with information relevant to the interim determination of payments.

Initial applications for CHGME PP funding must include the following forms:

HRSA 99: Demographic and Contact Information
HRSA 99-1: Determination of Weighted and Unweighted Resident FTE Counts
HRSA 99-2: Determination of Indirect Medical Education Data Related to the Teaching of Residents
HRSA 99-3: Certification
HRSA 99-5: Application Checklist

Applications accepted for review must be completed following the application guidance and instructions provided herein, submitted in English, typed, and include the above completed forms and supporting documentation as identified in the HRSA 99-5 (Application Checklist). The completed, signed application package must be postmarked by August 1, (insert year), and submitted to the:

Department of Health and Human Services

Health Resources and Services Administration

Bureau of Health Professions

Division of Medicine and Dentistry

Graduate Medical Education Branch

Parklawn Building

5600 Fishers Lane Room 9A-05

Rockville, Maryland 20857

Application materials are available electronically via the CHGME PP website at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm. Applications that are not postmarked by the specified deadline will not be accepted for processing and funding and will be returned to the applicant.

Interim Payment Determination and Disbursement (Based Upon the Initial Application)

In accordance with CHGME PP statutory requirements, information provided by participating children’s hospitals in their initial applications for CHGME PP funding is used by the CHGME PP to calculate payments for all eligible children’s hospitals prior to the beginning of the FY (October 1^st) for which children’s hospitals have applied for CHGME PP funding. CHGME PP payments, allocated to eligible children’s hospitals, are a function of the number of resident full-time equivalents (FTEs) participating in approved medical residency programs, inpatient discharges, case mix indexes, and the number of inpatient available beds, as reported by children’s hospitals in their initial applications for CHGME PP funding. Payments are awarded for direct medical education (DME) and indirect medical education (IME) expenses, respectively. DME and IME payment calculations are subject to all rules, regulations, and policies governing the CHGME PP.

On or after October 1^st of the FY for which eligible children’s hospitals have applied for CHGME PP funding, the CHGME PP will begin making interim payments. CHGME PP payments to eligible children’s hospitals will be contingent upon the passage of the DHHS’ budget for the given FY by the President. Children’s hospitals will be notified, in writing, of the Secretary’s interim payment determination. In accordance with CHGME PP statutes, payments will reflect a 25 percent withholding from each interim installment (payment) for both DME and IME payments, as necessary, to ensure that a hospital will not be overpaid on an interim basis.

Assessment of Resident FTE Counts Reported in Initial Applications

The CHGME PP statute, Public Law 106-310, mandates that “the Secretary shall determine any changes to the number of residents reported by a hospital in the (initial) application of the hospital for the current FY for both direct and indirect expense amounts.” Therefore, prior to the end of the FY for which children’s hospitals have applied for CHGME PP funding, the Secretary must determine (reconcile) any changes to the number of resident FTEs reported by a hospital in its initial application for the current FY, which will impact final payments made by the CHGME PP to all eligible children’s hospitals. This determination is done by conducting a comprehensive assessment of the resident FTE counts claimed by children’s hospitals in their initial applications for CHGME PP funding.

The CHGME PP has contracted with fiscal intermediaries (hereinafter CHGME FIs) to carry out an assessment of resident FTE counts (hereinafter the “Resident FTE Assessment Program”) reflected in participating children’s hospitals initial applications for CHGME PP funding to determine any changes to the resident FTE counts initially reported. A 100 percent assessment of resident FTE counts reported by children’s hospitals in their initial applications for CHGME PP funding is performed regardless of the type(s) of Medicare cost report (MCR) the hospital files (e.g., full, low- or no-utilization) for purposes of receiving CHGME PP funding. This process is designed to assess resident FTE counts for all children’s hospitals in an equitable fashion and within CHGME PP time constraints.

The Resident FTE Assessment Program requires participating children’s hospitals to comply with requests from the CHGME FIs, within the time constraints provided, as any changes to resident FTE counts in one children’s hospital’s application for CHGME PP funding affects the distribution of funds among all eligible children’s hospitals. To minimize public burden, CHGME FIs use and build upon work previously conducted by CHGME and/or Medicare FIs in prior years. The CHGME PP has made available several guidance documents on the CHGME PP’s website at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm which provide further information about the Resident FTE Assessment Program and documentation recommendations related to the assessment of resident FTE counts.

At the conclusion of the Resident FTE Assessment Program, the CHGME FIs will forward final assessment reports to the respective children’s hospitals, the Medicare FIs, and the CHGME PP explaining the results of the review. The assessment reports include CHGME FI-generated HRSA 99-1’s, which children’s hospitals must use to complete their reconciliation applications (see Reconciliation Application below). The assessment reports may also include supporting documentation including, but not limited to: adjustment reports, updates to the intern and resident database, adjustments to the Centers for Medicare and Medicaid Services (CMS) form 2552-96 Worksheet E-3, Part IV, or letters (to the Medicare FI) requesting the reopening of one or more MCRs.

Reconciliation Application

During the third quarter of each FY (typically April 1^st) for which payments are being made, the CHGME PP will release a reconciliation application for use by participating children’s hospitals to report changes in the resident FTE counts reported in their initial applications for CHGME PP funding. For children’s hospitals to continue receiving CHGME PP funding, they must submit a completed reconciliation application for CHGME PP funding in accordance with established deadlines noted below. The resident FTE counts reported by children’s hospitals in their reconciliation applications must be for the same MCR period(s) identified in the hospital’s initial application for the subject FY and consistent with those reported in the CHGME FIs FTE final assessment report to be accepted by the CHGME PP. The resident FTE counts from the final assessment reports are used to determine the final amounts payable to children’s hospitals for the current FY for both DME and IME. Children’s hospitals whose resident FTE counts have not changed are not exempt from completing and submitting a CHGME PP reconciliation application.

Reconciliation applications for CHGME PP funding must include the following forms:

HRSA 99: Hospital Demographic and Contact Information
HRSA 99-1: Determination of Weighted and Unweighted Resident FTE Counts
HRSA 99-2: Determination of Indirect Medical Education Data Related to the Teaching of Residents
HRSA 99-3: Hospital Certification
HRSA 99-4: Government Performance and Results Act Tables
HRSA 99-5: Application Checklist

Department of Health and Human Services

Health Resources and Services Administration

Bureau of Health Professions

Division of Medicine and Dentistry

Graduate Medical Education Branch

Parklawn Building

5600 Fishers Lane Room 9A-05

Rockville, Maryland 20857

Application materials are available electronically via the CHGME PP website at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm. If a children’s hospital fails to complete and return a reconciliation application according to the terms and conditions of the CHGME PP, the DHHS may suspend the award, pending corrective action, or may terminate the award for cause.

Children’s hospitals that were not eligible to participate or did not apply for funding during the initial application process for a given FY are not eligible to apply for and receive funding during the reconciliation application process for the same FY. These hospitals must wait until the next (initial) application cycle to apply for CHGME PP funding.

Final Payment Determination and Disbursement (Based Upon the Reconciliation Application)

The Secretary will determine any balance due or any overpayment made to individual hospitals following the determination of changes, if any, to the number of resident FTEs reported by children’s hospitals in their reconciliation applications as a result of the Resident FTE Assessment Program. Children’s hospitals will be notified, in writing, of the Secretary’s final reconciliation payment determination during the fourth quarter (July 1^st – September 30^th) of the FY in which payments are being made.

Children’s hospitals that have been notified of an overpayment will have 30 days to return the overpayment to the DHHS without accrual of interest. Children’s hospitals that fail to return overpayments within the specified timeframe will accrue and be responsible for any interest.

Reconciliation payments will be made to individual hospitals on or before the end of the FY (September 30^th) in which payments are being made. The Secretary will include in the reconciliation payments funding initially withheld in accordance with statutory requirements. All hospitals, whether or not they report changes to their resident FTE counts during the reconciliation process, can expect changes to their final payment determination as a result of resident FTE count changes reported by other participating children’s hospitals. This is due to the methodology used to determine CHGME PP payments. More detailed information is available on the CHGME PP payment methodology in Section V of this application package. Information on the payment formulas is also available on the CHGME PP website at http://bhpr.hrsa.gov/childrenshospitalgme/. DME and IME payment calculations are subject to all rules and regulations governing the CHGME PP statute, including the June 19, 2000 Federal Register notice for DME, the July 20, 2001 Federal Register notice for IME, and §422 of the Medicare Modernization Act (MMA) of 2003 and all accompanying policies and regulations.

At the end of the FY, the CHGME PP may make a final payment to distribute any remaining funds, including those funds that have been returned to the DHHS during the course of the FY as a result of overpayment or hospitals’ loss of eligibility.

Electronic Availability of Application Materials

Application materials are available electronically via the CHGME PP website at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm.

Section III

Department of Health and Human Services

OMB No. 0915-0247

Health Resources and Services Administration

Expiration Date: 01/31/2007

CHILDREN’S HOSPITALS GRADUATE MEDICAL EDUCATION PAYMENT PROGRAM

APPLICATION FORMS

Public Burden Statement

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number. The OMB control number for this project is 0915‑0247. Public reporting burden for the applicant for this collection of information is estimated to average 70.50 hours per response, including the time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to HRSA Reports Clearance Officer, 5600 Fishers Lane, Room 14‑33, Rockville, Maryland, 20857.

INSERT CHGME PP APPLICATION FORMS AFTER THIS PAGE

(FORMS HRSA 99, HRSA 99-1, HRSA 99-2, HRSA 99-3, HRSA 99-4, HRSA 99-5)

Section IV

Hospital Eligibility

Eligibility Criteria

According to Public Law 106-310, a children’s teaching hospital must meet the following eligibility criteria for CHGME PP funding. The hospital must:

participate in an approved GME program;
have a Medicare Provider Agreement;
be excluded from the Medicare inpatient prospective payment system (PPS) under section 1886(d)(1)(B)(iii) of the Social Security Act, and its accompanying regulations⁽¹⁾; and
operate as a “freestanding” children’s teaching hospital, as defined by the CHGME PP.⁽²⁾

⁽¹⁾ A hospital with a 3300 series Medicare provider number would meet this criterion (i.e., 55-3300).

⁽²⁾A children’s teaching hospital is considered “freestanding” if it does not operate under a Medicare hospital provider number assigned to a larger health care entity that receives Medicare GME payments.

Additional references:

Social Security Act, Section 1886

CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Changes in Eligibility

A hospital remains eligible for CHGME PP funding as long as it meets the eligibility criteria listed above and trains residents as a “freestanding” children’s hospital during the FY for which CHGME PP payments are being made.

If a hospital becomes ineligible for payments:

it must notify the CHGME PP immediately of the change in status and the date of the change; and
it will be liable for the reimbursement, with interest, of any funds received during the period of ineligibility.

Additional references:

CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Section V

Payment Methodology

CHGME PP funding to individual children’s hospitals is based upon a number of variables, including the rolling average of weighted and unweighted resident FTE counts, which are used to calculate DME and IME payments, respectively. Payment variables and calculations are subject to all rules and regulations governing the CHGME PP statute, including the June 19, 2000 Federal Register notice for DME, the July 20, 2001 Federal Register notice for IME, and §422 of the MMA of 2003 and all accompanying policies and regulations.

The rolling average is the average of the resident FTE counts reported by the children’s hospital for the ⁽¹⁾:

most recently filed MCR (or the most recently completed MCR period); and
the prior two years.

⁽¹⁾ CHGME PP funding to a children’s hospital that has not completed three (3) MCR periods will be based upon the hospital’s resident FTE count from its “most recently filed” or “most recently completed” MCR period until three (3) MCR periods have been completed.

The rolling average resident FTE count includes all residents except those that qualify for an adjustment after the averaging rules are applied in accordance with 42 CFR 413.77.

The resident FTE count for any MCR period is based upon the number of:

allopathic and osteopathic residents following application of the “cap”, where applicable; and
dental and podiatric residents.

Effective “for portions of cost reporting periods occurring on or after July 1, 2005”, the CHGME PP will not include resident FTEs counted against the §422 cap increase in the 3-year rolling average calculation for purposes of DME and IME payments. Additional information regarding the CHGME PP’s implementation of §422 of the MMA of 2003 is included in Sections VII and VIII of this application package.

Additional references:

Social Security Act, Section 1886
42 CFR 413.77 (CMS)
CMS, Federal Register Notice, August 11, 2004 (69 FR 48916)
CHGME PP, Federal Register Notice dated June 19, 2000 (65 FR 37985)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)
CHGME PP, Federal Register Notice dated October 22, 2003 (68 FR 60396)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Section VI

Hospital Data Needed to Complete the CHGME PP Application

Data Sources for Children’s Hospitals that File Full MCRs

To complete a CHGME PP application, hospitals that file full MCRs (i.e., report residents to Medicare on CMS 2552-96, Worksheet E-3, Part IV) must use the data as reflected in their:

most recently filed MCR for the period ending on or before December 31, 1996 (the “cap year");
most recently filed MCR; and the
prior two years.

In addition, hospitals who received adjustments to their cap (increases or decreases) as a result of §422 of the MMA of 2003 must use data included in and provide a copy of their written notification from CMS regarding these adjustments. Additional information regarding the CHGME PP’s implementation of §422 of the MMA of 2003 is included in Sections VII and VIII of this application package.

Additional references:

Social Security Act, Section 1886
42 CFR 413.77 (CMS)
CMS, Federal Register Notice, August 11, 2004 (69 FR 48916)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Data Sources for Children’s Hospitals that File Low- or No-Utilization MCRs

To complete a CHGME PP application, hospitals that file low- or no-utilization MCRs (i.e., do not report residents to Medicare on CMS 2552-96, Worksheet E-3, Part IV) must use the data as reflected in their hospital records for the:

most recently completed MCR period for the period ending on or before December 31, 1996 (the “cap year”);
most recently completed MCR period; and the
completed MCR periods for the prior two years.

Hospitals whose most recently completed MCR period ends less than five (5) months prior to the stated CHGME PP initial application deadline may report as their most recently completed MCR period resident FTE counts from their most recently completed or the previously completed MCR period.

Example:

Charlie’s Angels Children’s Center (CACC) will file a low-utilization MCR for its 6/30/03 year-end. The CHGME PP application deadline for FY 2004 is August 1, 2003 (approximately 1 month after CACC’s year-end). CACC has the option of reporting as its “most recently completed MCR period” data from its 6/30/02 or 6/30/03 year-end. Since CACC needs time to close-out its resident FTE counts and financial records for its 6/30/03 year-end, it decides to use the resident FTE count data from its 6/30/02 cost reporting period to complete Section 4 of HRSA-99-1. Consequently, CACC must use data from its 6/30/01 and 6/30/00 MCR periods to complete Sections 5 and 6 of the HRSA-99-1, respectively. CACC must also use its hospital data from its 6/30/02 cost reporting period to complete all subsequent application forms (i.e., HRSA-99-2, HRSA-99-4, etc.). CACC cannot use the resident FTE count data from its 6/30/03 MCR period until the next CHGME PP initial application cycle (FY 2005).

Additional references:

Social Security Act, Section 1886
42 CFR 413.77 (CMS)
CMS, Federal Register Notice, August 11, 2004 (69 FR 48916)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Data Sources for Children’s Hospitals that Have Not Completed Three (3) MCR Periods

If a hospital has completed at least one (1), but not more than two (2) MCR periods, CHGME PP funding to the children’s hospital will be based upon data from the hospital’s “most recently filed” or “most recently completed” MCR period until three (3) MCR periods have been completed. Hence, the hospital will not complete sections 5 and 6 of HRSA-99-1 and its DME and IME payments will not be based upon a three-year rolling average resident FTE count.

Upon completion of three (3) MCR periods, the hospital will complete sections 5 and 6 of HRSA-99-1 and will receive DME and IME payments based upon a three-year rolling average resident FTE count.

Additional references:

CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Data Sources for Children’s Hospitals that Have Not Completed One (1) MCR Period

New children’s teaching hospitals (new to the CHGME PP) training residents who were originally trained in a program that received and will continue to receive funding under the CHGME PP are required to wait until they have completed a MCR period before applying for CHGME PP funding. These hospitals must also apply the 3-year rolling average (to their resident FTE counts) in accordance with Medicare regulations. Over a 3-year period, the “new children’s teaching hospital” will gradually increase its number of resident FTEs that can be claimed in the CHGME PP as the children’s hospital that originally trained those resident FTEs gradually decreases its resident FTE count for determining payments from the CHGME PP.

New children’s teaching hospitals (new to the CHGME PP) training residents previously trained at a hospital that never received (or is no longer receiving) funding under the CHGME PP are eligible for CHGME PP funding without having completed a MCR period. In addition, a hospital that becomes newly eligible for the CHGME PP by starting its own “new medical residency training program” according to Medicare regulation 42 CFR 413.79(e)(1) will also be eligible for CHGME PP funding without having completed a MCR period.

Hospitals that are eligible to receive CHGME PP funding without having completed a MCR period must follow the guidance provided in Section X of this application package which provides special calculation instructions for hospitals that have not completed a MCR report.

Additional references:

CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Section VII

Determining the Total Number of Resident Full-Time Equivalents

Cap and Cap Year

Section 1886(d)(5)(B)(v) of the Social Security Act established “caps” on the number of allopathic and osteopathic residents that a hospital operating an approved GME program may count when requesting payment for DME and IME costs. A hospital’s “cap” (hereinafter the “1996 Base Year Cap”) is currently defined as the “number of unweighted resident FTEs enrolled in a hospital’s allopathic and osteopathic residency programs during the most recent cost reporting period ending on or before December 31, 1996 (the “cap year”).” The cap (i.e., limit) on the number of allopathic and osteopathic residents is effective for all cost reporting periods beginning on or after October 1, 1997. Dental and podiatric residents are exempt from the cap, but are included in the resident FTE counts for all relevant years to calculate the rolling average.

The “cap year” is defined as a hospital’s most recent cost reporting period ending on or before December 31, 1996.

Example:

Additional references:

Social Security Act, Section 1886
42 CFR 413.79 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA-99-1 and HRSA-99-2

Adjustments to a Hospital’s Cap

As noted above, Section 1886(d)(5)(B)(v) of the Social Security Act established caps on the number of allopathic and osteopathic residents that a hospital operating an approved GME program may count when requesting payment for DME and IME costs. While Medicare and the CHGME PP only make DME and IME payments for the number of allopathic and osteopathic resident FTEs up to a hospital’s “1996 Base Year Cap”, some hospitals have trained allopathic and osteopathic residents in excess of their 1996 Base Year Cap. There are also a number of hospitals that have reduced their resident positions to a level below their 1996 Base Year Cap.

Subsequent legislative actions and related Federal Register notices provisions have been published addressing these issues allowing a hospital’s cap to be permanently changed (increased or decreased) by CMS or temporarily adjusted at the request of the hospital and approved by CMS. These provisions are detailed below.

§422 of the Medicare Modernization Act of 2003

In December 2003, the President signed the MMA of 2003 (also known as the Medicare Prescription Drug and Improvement Act of 2003), Public Law 108-173. §422 of the MMA, added Section 1886(h)(7) to the SSA. This provision reduced the 1996 Base Year Cap for certain hospitals and redistributed those positions to other hospitals that applied for and received an increase to their 1996 Base Year Cap under §422. Hereinafter, any decreases to a hospital’s 1996 Base Year Cap as a result of §422 will be referred to as the “§422 Cap Reduction” and any increases to the 1996 Base Year Cap as a result of §422 will be referred to as the “§422 Cap Increase.” Authority for implementing §422 of the MMA was delegated to the CMS. Determinations made and implemented by CMS in response to §422 are final and not subject to appeal.

Under the CHGME PP statute, by incorporation of the Social Security Act provisions, the HRSA must implement the counting law and rules of Medicare, which include those related to the implementation of §422 of the MMA. Additional information regarding the CHGME PP’s implementation of §422 of the MMA can be found in Section VIII of this application package.

Medicare GME Affiliation Agreements and Other Regulations Allowing the Establishment or Adjustment of a Hospital Cap

Hospitals that were not in existence for the most recent cost reporting period ending on or before December 31, 1996 do not have a “1996 Base Year Cap” and are, therefore, “capped” to a resident FTE count of zero “0”. Hence, hospitals must obtain (or adjust) their 1996 Base Year Cap (or lack thereof) in order to receive CHGME PP funding.

To provide an adjustment to a cap, the CHGME PP will allow hospitals to add resident FTEs to their “1996 Base Year Cap” based on the following Medicare and CHGME PP regulations:

the formation of a new medical residency program as described in 42 CFR 413.79(e)(1); or
the execution of a Medicare GME Affiliation Agreement for an aggregate cap, as set forth in 42 CFR 413.79(f) and 63 FR 26338 as published in the Federal Register on May 12, 1998, with the following exceptions:

The CHGME PP allows this exception because hospitals must meet eligibility criteria and have their caps determined prior to the CHGME PP application deadline. If the CHGME PP application deadline occurs before July 1^st, some hospitals would have a cap of zero and thus be excluded from receiving funds. By deviating from the prescribed Medicare final rule, the CHGME PP will not place some hospitals in this position.

Unlike the Medicare Program, for the first year that a hospital is eligible to participate in the CHGME PP, the CHGME PP will not prorate the cap based on the effective date of the cap. Instead, the full value of the cap as determined by the Medicare GME Affiliation Agreement will be used. For purposes of the CHGME PP and its application forms, a hospital that is now starting to train residents previously trained at a hospital that never received or is no longer receiving funds from the CHGME PP will be allowed to use the cap agreed upon in the Medicare GME Affiliation Agreement until the full value of the cap is reflected in the MCR. Afterwards, the hospital will use the resident FTE count and cap from its filed MCR as indicated in Section VI of this application package.

Example:

CACC opened as a freestanding children’s hospital on January 1, 2003 and would like to apply for FY 2004 CHGME PP funding. The CHGME PP FY2004 application deadline is August 1, 2003. Since CACC did not train residents in 1996, it has a cap of zero, but was able to arrange a Medicare GME Affiliation Agreement for an aggregate cap with Shirley Temple Medical Center in which CACC’s current residents had previously trained.

CACC did the following in order to apply for CHGME PP funding:

Established a cap by forming a Medicare GME Affiliation Agreement with Shirley Temple Medical Center for an aggregate cap.
The agreement had an effective date of January 1, 2003 (for CHGME PP purposes only) and an effective date of July 1, 2003 and expiration date of June 30, 2004 for and in accordance with Medicare rules and regulations.
CACC and Shirley Temple Medical Center filed the agreement with their Medicare FIs (the hospital’s have different Medicare FIs) before June 30, 2003 (in accordance with Medicare rules and regulations) and provided a signed copy to the CHGME PP following acceptance by the FIs.

Hospitals that report residents to Medicare and are part of an affiliated group may elect to apply the resident FTE limit on an aggregate basis under Medicare rules and regulations. If the combined resident FTE counts for the individual members of the group exceed the aggregate limit, each hospital’s resident FTE cap will be adjusted per the agreement between the members of the affiliated group. These adjustments must be reflected in the filed MCR in order to be considered for the CHGME PP.

Hospitals that receive an increase to their 1996 Base Year Cap from CMS under §422 of the MMA of 2003 and participate in a Medicare GME Affiliation Agreement under 42 CFR 413.79(f) on or after July 1, 2005, may only affiliate for the purpose of adjusting their (original) 1996 Base Year Cap. The additional slots that a hospital receives under §422 may not be aggregated and applied (through Medicare GME Affiliation Agreements) to the cap of any other hospitals.

Hospitals should refer to 42 CFR 413.79(f) for additional information on adjustments to the cap.

Additional references:

Social Security Act, Section 1886
42 CFR 413.79(f) (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Exceeding the Cap

For DME payment calculations if a hospital’s unweighted resident FTE count for allopathic and osteopathic residents exceeds its FTE limit (“cap”), the weighted count is reduced by the ratio of the resident FTE limit to the actual unweighted resident FTE count for the subject cost reporting period. Additional information regarding the CHGME PP’s implementation of §422 of the MMA of 2003 is provided below.

Example:

CACC, per its Medicare GME Affiliation Agreement, has a cap of 100. For its 6/30/03 MCR, CACC reported an unweighted resident FTE count of 150 and a weighted count of 105 for its allopathic and osteopathic programs.

For DME payment purposes, CACC would determine its weighted allopathic and osteopathic resident FTE count by taking its cap divided by its total unweighted resident FTE count and multiplying that product by the total weighted resident FTE for allopathic and osteopathic residents [(100/150) x 105 = 70.00]. The weighted count of any dental and podiatric residents trained during this MCR period would be added to the 70.00 as dental and podiatric residents are exempt from (i.e., not subject to) the cap.

For IME payment calculations if a hospital’s unweighted resident FTE count for allopathic and osteopathic residents exceeds its FTE limit (“cap”), the hospital must report the lesser of the unweighted resident FTE count or the cap for the subject cost reporting period. Additional information regarding the CHGME PP’s implementation of §422 of the MMA of 2003 is provided below.

Example:

For IME payment purposes, CACC would report 100.00 [the lesser of the unweighted allopathic and osteopathic resident FTE count (150) or the cap (100)]. The unweighted count of any dental and podiatric residents trained during this MCR period would be added to the 100.00 as dental and podiatric residents are exempt from (i.e., not subject to) the cap.

Impact of §422 of the MMA When a Hospital Exceeds It’s Cap

§422 of the MMA will affect the determination of DME and IME payments for each of the children’s hospitals participating in the CHGME PP. The CHGME PP will begin accounting for the redistribution of the 1996 caps under §422 of the MMA in determining DME and IME payments starting with “portions of a hospital’s cost reporting periods occurring on or after July 1, 2005.”

Children’s hospitals whose cap has been reduced under §422 of the MMA will report and be paid based on the §422 Cap Reduction effective “for portions of cost reporting periods occurring on or after July 1, 2005.” The 1996 Base Year Cap will be used for MCR periods prior to the effective date. Children’s hospitals will be asked to submit a copy of the letter they received from CMS informing them of the reduction in their cap that includes the actual reduction. The full effect of the reduction for a given hospital will take about three years following implementation of §422 when all three MCR periods reflected in the hospital’s application for CHGME PP funding are affected by the §422 Cap Reduction.

For children’s hospitals who received an increase to their 1996 Base Year Cap under §422 of the MMA, the CHGME PP will not include resident FTEs counted against the §422 Cap Increase in the 3-year rolling average calculation for purposes of DME and IME payments effective for portions of cost reporting periods and discharges occurring on or after July 1, 2005. In addition, effective for discharges occurring on or after July 1, 2005, the CHGME PP will not apply the intern/resident to bed (IRB) ratio cap to the residents claimed against a hospital’s §422 Cap Increase. However, residents claimed against the 1996 Base Year Cap will be subject to the 3-year rolling average and will be subject to the IRB ratio cap.

Additional references:

42 CFR 413.79 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA 99-1and HRSA 99-2

Eligible Residency Programs (Approved Training Programs)

Residents may be included in a hospital’s resident FTE count for CHGME PP purposes if the residency program (in which the resident is enrolled) meets one of the following criteria:

The program must be approved by one of the following accrediting bodies:

Accreditation Council for Graduate Medical Education (ACGME);
Committee on Hospitals of the Bureau of Professional Education of the American Osteopathic Association;
Commission on Dental Accreditation of the American Dental Association; or
Council of Podiatric Medicine Education of the American Podiatric Medical Association.

The program may count towards certification of the participant in a specialty or subspecialty listed in the current edition of the Directory of Graduate Medical Education Programs (published by the American Medical Association) or the Annual Report and Reference Handbook (published by the American Board of Medical Specialties).

The program is approved by the ACGME as a fellowship program in geriatric medicine; or

The program would be accredited except for the accrediting agency’s reliance upon an accreditation standard that requires an entity to perform an induced abortion or require, provide, or refer for training in the performance of induced abortions, or make arrangements for such training, regardless of whether the standard provides exceptions or exemptions.

Additional references:

Social Security Act, Section 1886
42 CFR 413.75(b) (CMS)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Eligible Residents

In order to be counted in CHGME PP payment calculations, a resident must be:

in an approved residency training program (see Eligible Residency Program above);

and either

a graduate of an accredited medical school in the U.S. or Canada; or

have passed the United States Medical Licensing Examination (USMLE) Parts I & II (international or foreign medical graduates)

Additional references:

Social Security Act, Section 1886
42 CFR 413.75(b) (CMS)
42 CFR 413.80 (CMS)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

International Medical Graduates (IMGs)

An IMG [(formerly known as a foreign medical graduate (FMG)] is a resident who is not a graduate of a medical, osteopathy, dental, or podiatry school, respectively, accredited or approved as meeting the standards necessary for accreditation by the:

Liaison Committee on Medical Education of the American Medical Association;
American Osteopathic Association;
Commission on Dental Accreditation; or the
Council on Podiatric Medical Education.

In order for an IMG to be included in a hospital’s resident FTE count, s/he must have passed Parts I and II of the USMLE and be enrolled in an eligible residency program.

Additional references:

Social Security Act, Section 1886
42 CFR 413.75(b) (CMS)
42 CFR 413.80 (CMS)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Resident Full-Time Equivalent (FTE) Counts

Resident FTE counts are based on the number of residents training at the hospital complex and certain non-hospital/non-provider settings/sites throughout the hospital’s fiscal year. Residents are counted as FTEs based on the total time necessary to fill a full-time residency slot for the year.

For purposes of clarification, a resident FTE is measured in terms of time worked during a residency training year. It is not a measure of the number of individual residents who are working.

Additional references:

Social Security Act, Section 1886
42 CFR 413.78 (CMS)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Initial Residency Period (IRP)

Residents are divided into two categories, those in their:

initial residency period (IRP);
1. Effective July 1, 1995, an IRP is defined as the minimum number of years required for board eligibility.
2. For osteopathic, dentistry, and podiatric programs, the IRP is the minimum number of years of formal training necessary to satisfy the requirements of the approving body for those programs.
3. Prior to July 1, 1995, an IRP is defined as the minimum number of years required for board eligibility in a specialty or subspecialty plus 1 year (not to exceed 5 years with some exceptions).

and those beyond their IRP.

Example:

The IRP for pediatrics is 3 years. Therefore, the initial residency period for all pediatric subspecialties (e.g., pediatric cardiology) is three years.

The IRP for general surgery is 5 years. Therefore, the initial residency period of all surgical subspecialties (e.g., pediatric surgery) is 5 years even if the training program requires a longer period of training.

A Pediatric Surgery (subspecialty) resident (or fellow) who previously completed a 5-year general surgery residency program and is now in his first year of subspecialty training (in Pediatric Surgery) is beyond his IRP. His IRP was 5 years (general surgery).

Exceptions apply to the IRP for residents enrolled in preventive medicine, geriatric medicine, transitional year and combined residency programs. Refer to 42 CFR 413.79(a) for additional information on the IRP and exceptions.

Additional references:

Social Security Act, Section 1886
42 CFR 413.79(a) (CMS)

Applicable to the following application forms: HRSA-99-1

Weighting of Resident FTE Counts

The CHGME PP, like Medicare, assigns a 0.5 (or ½) weighting factor to residents who are beyond their IRP. Hence a resident who is beyond his or her initial residency period is factored by 0.5 regardless of the number of years or length of the training program in which s/he is currently enrolled.

Example:

John Doe completed a 3-year pediatric residency program on June 30, 1999 at CACC. Following completion of his residency program, John continued his training in a pediatric cardiology fellowship program also at CACC. During the first year of his fellowship program (July 1, 1999 to June 30, 2000), John spent 40% of the academic year at CACC and 60% of the academic year rotating to other teaching hospitals.

CACC’s MCR period is the same as the academic year (July 1 to June 30). Hence, CACC would report John as 0.20 for the MCR period ending June 30, 2000 [(40/100) x 0.5 = .20]. CACC must weight John’s resident FTE count because the IRP for pediatrics is 3 years and John is in his 4^th year of training (3 years of residency training and 1 year of fellowship training).

For CHGME PP purposes, the weighting of resident FTE counts is also applicable to the increase in resident FTEs based on §422 of the MMA et al.

Additional references:

Social Security Act, Section 1886
42 CFR 413.79(b) (CMS)

Applicable to the following application forms: HRSA-99-1

Where Residents Are Counted

The time a resident spends anywhere within the hospital complex (see “Hospital Complex” below) may be included in the resident FTE count for CHGME PP purposes. In addition, the time spent by residents in certain non-hospital/non-provider settings/sites is counted if the criteria identified below (under “Non-Provider/Non-Hospital Settings and Written Agreements”) are met.

Additional references:

Social Security Act, Section 1886
42 CFR 413.78 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Hospital Complex

The time a resident spends anywhere within the hospital complex (as defined in 42 CFR 413.65) may be included in the resident FTE count for CHGME PP purposes.

The CMS final rule implementing the per resident amount (PRA) methodology for payment of the direct GME costs of approved GME activities defines a hospital complex as “hospitals and hospital-based providers and sub providers” (54 FR 40286, September 29, 1989). The term “hospital” is defined in Section 1861(e) of the Social Security Act as, in part, an institution which is primarily engaged in providing, by or under the supervision of physicians, diagnostic and therapeutic services to inpatients. The term “provider of services” is defined in Section 1861(u) of the Social Security Act as a hospital, skilled nursing facility, comprehensive outpatient rehabilitation facility, home health agency, hospice program, or, for purposes of Section 1814(g) and Section 1835(c), a fund. The term “sub provider” is defined in the Provider Reimbursement Manual (PRM) Part II, Section 2405(b) as “a portion of a general hospital which has been issued a sub provider identification number because it offers a clearly different type of service from the remainder of the hospital, such as long-term psychiatric.”

The CHGME PP, however, does not differentiate between PPS and non-PPS locations within a hospital complex.

Additional references:

Social Security Act, Section 1886
42 CFR 413.65 (CMS)
42 CFR 413.78(a) (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Non-Provider/Non-Hospital Settings and Written Agreements

The time a resident spends in a non-provider (or non-hospital) setting such as a physician’s office or a freestanding community health center in connection with an approved program may be included in the resident FTE count if the criteria in Federal regulation 42 CFR 413.78 are met. For CHGME PP purposes, 42 CFR 413.78 applies to both DME and IME funding received under the CHGME PP.

Written agreements covering residents’ time spent in non-provider/non-hospital settings shall cover a period of one year and must commence on the start of the cost reporting period and must be between the hospital and the non-hospital setting, not between the related School of Medicine (SOM), School of Podiatric Medicine (SOPM), or School of Dentistry (SOD). Refer to 42 CFR 413.78 for additional information on written agreements.

Additional references and application forms:

Social Security Act, Section 1886
42 CFR 413.78 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Partial Resident Full-Time Equivalents (FTEs)

A partial resident FTE is a resident who does not spend all time that is part of the approved training program in the hospital complex or qualified non-hospital setting. A resident will count as a partial resident FTE based on the proportion of allowable time worked at the children’s hospital and qualified non-hospital (provider) settings compared to the total time necessary to fill a full-time residency slot. Instances where a resident would be counted as a partial resident FTE include, if the resident:

is part-time;
rotates to other hospitals as part of the approved training program sponsored by the children’s hospital;
is in a program sponsored by another hospital and spends one or more rotations at the children's hospital;
is on maternity leave;
joins or leaves a program mid-year; or
passes the USMLE mid-year.

Hospitals should consult with their FIs regarding additional exceptions.

The sum of partial FTE resident counts at all institutions where an individual resident works as part of his/her approved residency program may not exceed 1.0 FTE. Also, time spent by residents moonlighting may not be counted.

Example:

During the course of the year, a full-time resident in orthopedic surgery spends 90 days at the children’s hospital and 275 days at the hospital sponsoring the residency program. The resident would count as a 0.25 FTE at the children’s hospital [90/365 = 0.2465 (rounded to 0.25)].

A part-time third year resident in pediatrics works 4 days week. The normal workweek for a full time third year pediatric residents is 6 days per week. The resident would count as 0.67 FTE [4/6 = .6666 (rounded to 0.67)]

During the course of the year, a full-time resident (who is also a foreign medical graduate) is enrolled in his second year of a three-year family practice residency program at CACC. The resident spends the entire academic year (2000-2001) at CACC and does not rotate to any other sites. The resident took and passed Part I of the USMLE in September 2000. On May 1, 2001, the resident sat for Part II of the USMLE and is awaiting the examination results. In June 2001 the resident learns that he passed Part II of the USMLE. Since CACC’s year-end is June 30, CACC may count and include the resident in their resident FTE counts (as a partial FTE) for the period May 1, 2001 (the date he took the examination) to June 30, 2001 (CACC’s year end). The resident

would count as 0.17 FTE [61 days (31 days in May + 30 days in June)/ 365 days = 0.1671 (rounded to 0.17)].

Additional references:

Social Security Act, Section 1886
42 CFR 413.78(b) (CMS)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Research Time

Research may be included in a hospital’s resident FTE count if the research is part of the residency program and the resident carries out the research in:

the children’s hospital complex (clinical or bench research); or
in a non-provider setting where the research involves patient care and the compensation for both the residents, the faculty and other teaching costs are paid by the children’s hospital (requirements listed at 42 CFR 413.78 must be met (66 FR 39896, Aug. 1, 2001)).

Additional references:

Social Security Act, Section 1886
42 CFR 413.75 (CMS)
42 CFR 413.78 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA 99-2, and HRSA 99-4

Resident FTE Count Accuracy and Documentation

Children’s hospitals are responsible for the accuracy of the resident FTE counts submitted to HRSA and are subject to audit. More specifically, the Secretary, by statute, must “determine any changes to the number of residents reported by a hospital in the (initial) application of the hospital for the current FY for both direct and indirect expense amounts.” This mandate is accomplished through the Resident FTE Assessment Program carried out by the CHGME PP (see “Application Cycle and Deadlines”). Children’s hospitals are not required to submit with their completed initial applications for CHGME PP funding, documentation in support of the resident FTE data reported in their applications. However, at the time children’s hospitals certify their applications (i.e., sign and submit form HRSA 99-3 to the CHGME PP), the hospital should possess documentation in accordance with 413.75(d) and other applicable Medicare record-keeping regulations. Hospitals that do not report resident FTE counts to Medicare are not exempt from this policy.

The CHGME PP has developed a Documentation Guidance (document) and an accompanying sample documentation binder to assist participating hospitals in collecting and providing the documentation necessary to support resident FTEs reported by a children’s hospital in its initial application for CHGME PP funding. Participating children’s hospitals can use this document and the accompanying sample binder for compiling and organizing the information/data to be provided to the CHGME FI during the Resident FTE Assessment process. The Documentation Guidance (document) is available at http://bhpr.hrsa.gov/childrenshospitalgme/apply.htm.

Additional references:

42 CFR 413.20 (CMS)
42 CFR 413.24 (CMS)
42 CFR 413.75(d) (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA 99-2, and HRSA 99-4

Section VIII

Special Instructions for Calculating Reductions and Increases

to a Hospital’s 1996 Base Year Cap as a Result of

§422 of the Medicare Modernization Act of 2003

Hospitals that received an increase or reduction to their 1996 Base Year Cap as a result of §422 of the MMA must use the following methodology for calculating and claiming resident FTE counts against their caps.

Decrease to a Hospital’s 1996 Base Year Cap (§422 Cap Reduction)

Children’s hospitals who received a decrease to their 1996 Base Year Cap as a result of §422 of the MMA will report and be paid based on the §422 Cap Reduction effective “for portions of cost reporting periods occurring on or after July 1, 2005.” The 1996 Base Year Cap will be used for MCR periods prior to the effective date. Children’s hospitals will be asked to submit a copy of the letter they received from CMS informing them of the reduction in their cap that includes the actual reduction amount. The full effect of the reduction for a given hospital will take about three years following the implementation of §422 when all three MCR periods reflected in the hospital’s application for CHGME PP funding are subject to the §422 Cap Reduction.

Example:

CACC had 75 resident FTEs enrolled in its allopathic programs, 25 resident FTEs enrolled in its osteopathic programs and 7 resident FTEs enrolled in its dental and podiatric programs for its 6/30/96 MCR period (its most recent MCR period ending on or before December 31, 1996). Hence, CACC’s 1996 Base Year Cap for Medicare and CHGME PP purposes is 100 (75+25=100). However, in December 2004 CACC received a letter from CMS indicating that their 1996 Base Year Cap would be reduced by 7.50 resident FTEs under §422 of the MMA. CACC’s new, revised cap is now 92.50 (1996 Base Year Cap - §422 Cap Reduction). Any dental and podiatric residents trained during this MCR period would not be included in the 1996 Base Year Cap or the “new, revised” cap as dental and podiatric residents are exempt from (i.e., not subject to) the cap.

Increase to a Hospital’s 1996 Base Year Cap (§422 Cap Increase)

Children’s hospitals who received an increase to their 1996 Base Year Cap as a result of §422 of the MMA will report and be paid based on the §422 Cap Increase effective “for portions of cost reporting periods occurring on or after July 1, 2005.” The 1996 Base Year Cap will be used for MCR periods prior to the effective date. Children’s hospitals will be asked to submit a copy of the letter they received from CMS informing them of the adjustment to their cap that includes the actual increase amount. It is important to note that a §422 Cap Increase is not automatically added to a hospital’s 1996 Base Year Cap. A hospital’s ability to utilize their §422 Cap Increase is contingent upon whether the hospital is training above or below their 1996 Base Year Cap. Examples are provided below.

Examples (for Hospitals Training “Above” Their 1996 Base Year Cap):

CACC had 75 resident FTEs enrolled in its allopathic programs, 25 resident FTEs enrolled in its osteopathic programs and 7 resident FTEs enrolled in its dental and podiatric programs for its 6/30/96 MCR period (its most recent MCR period ending on or before December 31, 1996). Hence, CACC’s 1996 Base Year Cap for Medicare and CHGME PP purposes is 100 (75+25=100). However, in December 2004 CACC received a letter from CMS indicating that their 1996 Base Year Cap would be increased by 20 resident FTEs under §422 of the MMA. CACC now has a 1996 Base Year Cap of 100 and a §422 Cap Increase of 20.

Example #1: During CACC’s most recent MCR period, CACC claimed 110 allopathic and osteopathic resident FTEs and 7 dental and podiatric resident FTEs. Based on CACC’s 1996 Base Year Cap of 100 and §422 Cap Increase of 20, CACC would claim 100 resident FTEs against its 1996 Base Year Cap and the remaining 10 resident FTEs would be claimed against its §422 Cap Increase. Any dental and podiatric residents trained during this MCR period would be added to the total (un)weighted allopathic and osteopathic resident FTEs following application of the caps as dental and podiatric residents are exempt from (i.e., not subject to) the cap.

Example #2: During CACC’s most recent MCR period, CACC claimed 140 allopathic and osteopathic resident FTEs and 7 dental and podiatric resident FTEs. Based on CACC’s 1996 Base Year Cap of 100 and §422 Cap Increase of 20, CACC would claim 100 resident FTEs against its 1996 Base Year Cap and the remaining 40 resident FTEs would be claimed against its §422 Cap Increase. As CACC’s number of resident FTEs claimed exceeds both its 1996 Base Year Cap and its §422 Cap Increase, the DME and IME payment calculation methodology described in Section VII of this application package (“Exceeding the Cap”) would be followed. Any dental and podiatric residents trained during this MCR period would be added to the total (un)weighted allopathic and osteopathic resident FTEs following application of the caps as dental and podiatric residents are exempt from (i.e., not subject to) the cap.

Examples (for Hospitals Training “Below” Their 1996 Base Year Cap):

Example #1: During CACC’s most recent MCR period, CACC claimed 95 allopathic and osteopathic resident FTEs and 7 dental and podiatric resident FTEs. Based on CACC’s 1996 Base Year Cap of 100 and a §422 Cap Increase of 20, CACC would claim 95 resident FTEs against its 1996 Base Year Cap and zero “0” residents against its §422 Cap Increase. Any dental and podiatric residents trained during this MCR period would be added to the total (un)weighted allopathic and osteopathic resident FTEs following application of the caps as dental and podiatric residents are exempt from (i.e., not subject to) the cap

Additional references:

Social Security Act, Section 1886(h)(7)
42 CFR 413.79(b) (Centers for Medicaid and Medicare Services, formerly the Health Care Financing Administration)

Applicable to the following application forms: HRSA-99-1

Section IX

Special Instructions for Calculating

Indirect Medical Education Payment Variables

Hospitals applying for IME payments should follow the instructions provided below when calculating inpatient discharges, CMI, available beds, and the intern/resident to bed ratio. Additional information and “calculation” instructions are provided in Section X of this application package for hospitals that are eligible to begin receiving CHGME PP funding without having completed a MCR period.

Number of Inpatient Discharges

The number of inpatient discharges is a measure of a hospital’s inpatient care. This measure is defined as the sum of all daily inpatient discharges for the hospital’s most recently filed (or most recently completed) MCR period from all parts of the hospital complex including healthy newborns from the healthy newborn nursery. Pubic Law 108-490 does not exclude inpatient discharges associated with healthy newborns inpatient stays in the “well baby” nursery.

Additional references:

Social Security Act, Section 1886
Public Law 108-490, December 23, 2004

CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37986)

Applicable to the following application forms: HRSA-99-2

Case Mix Index (CMI)

The CMI is the sum of the diagnosis-related group (DRG) weights for all inpatient discharges excluding healthy newborns from the most recently filed (or most recently completed) MCR period divided by the number of inpatient discharges for the same period. All hospitals applying for IME payments must submit a CMI on all inpatients discharges using the appropriate CMS DRG version, excluding healthy newborns. This value must be reported to four decimal points. The CMS DRG version to be used for CHGME PP purposes is published, through the CHGME PP alert system each spring, prior to the beginning of the FY for which payments will be made. The principles in determining the version of the CMS grouper is delineated is the July 20, 2001 CHGME PP Federal Register Notice.

Additional references:

Social Security Act, Section 1886
Public Law 108-490, December 23, 2004

CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-2

Number of Available Beds

An available bed is defined as an adult or pediatric bed, including beds or bassinets available for lodging inpatients including beds in intensive care units, coronary care units, neonatal intensive care units, short stay units, and other special care inpatient hospital units. Beds in the following location are excluded: healthy newborn nursery, labor rooms, post-anesthesia or post-operative recovery rooms, outpatient areas, emergency rooms, ancillary departments, nurses’ and other staff residence, and other areas as are regularly maintained and utilized for purposes other than lodging inpatients. To be considered an available bed, a bed must be permanently maintained for lodging inpatients. It must be available for use and housed in patient rooms or wards (i.e. not in corridors or temporary beds). CMS in its August 11, 2004, final inpatient PPS Federal Register Notice, revised its regulations at 42 CFR 412.105(b) and 412.106(a)(1)(ii) to specify that bed days in a unit that was occupied to inpatient care for at least one day during the preceding 3 months are included in the available bed day count for a month. In addition, bed days for any beds within a unit that would otherwise be considered occupied should be excluded from the available bed day count for the current month if the bed has remained unavailable (could not be made available for patient occupancy within 24 hours) for 30 consecutive days, or if the bed is used to provide outpatient observation services or swing bed skilled nursing care. This clarified policy is effective for discharges occurring on or after October 1, 2004.

The available bed count for the current or prior MCR period is the sum of all available beds per day in the cost reporting period, excluding beds and bassinets in the healthy newborn nursery, divided by the number of days in that period.

Additional references:

Social Security Act, Section 1886
Public Law 108-490, December 23, 2004
42CFR412.105(b)
42 CFR 412.106(a)(1)(ii)
CMS, Federal Register Notice dated August 11, 2004 (69 FR 48916)

CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980, 37986)

Applicable to the following application forms: HRSA-99-2

Intern/Resident to Bed (IRB) Ratio

The IRB ratio for the most recently filed (or most recently completed) MCR period is equal to the 3-year unweighted rolling average divided by the number of available beds for the same period. The IRB ratio for the previous MCR period is equal to the unweighted resident FTE count for the previous MCR period divided by the number of available beds for the same period. To comply as closely as possible with Medicare rules and regulations, the Department applies a cap on the IRB ratio pursuant to regulations at 42 CFR 412.105(a)(1), whereby the ratio from the most recently filed (or most recently completed) MCR period may not exceed the ratio for the hospital's prior cost reporting period as defined above. Hospitals that meet the criteria for an exception or adjustment to their 1996 Base Year Cap (e.g. through a Medicare GME Affiliation Agreement) should refer to the CMS August 1, 2001 Federal Register Notice which provides additional information and guidance in determining the IRB ratio subject to these exceptions.

Effective for portions of cost reporting periods and discharges occurring on or after July 1, 2005, the CHGME PP will not include resident FTEs counted against the §422 cap in the 3-year rolling average calculation and the CHGME PP will not apply an IRB ratio cap to the resident FTEs counted against a hospital’s §422 Cap Increase for purposes of determining IME payments. A §422 IRB calculation will be implemented as guided by CMS rules and regulations.

Additional references:

Social Security Act, Section 1886
42 CFR 413.77 (Centers for Medicaid and Medicare Services, formerly the Health Care Financing Administration)
CMS, Federal Register Notice, dated August 1, 2001 (66 FR 39878)
CMS, Federal Register Notice, dated August 11, 2004 (69 FR 48916)
CHGME PP, Federal Register Notice dated June 19, 2000 (65 FR 37985)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)
CHGME PP, Federal Register Notice dated October 22, 2003 (68 FR 60396)

Applicable to the following application forms: HRSA-99-2

Section X

Special Calculation Instructions for Hospitals that

Have Not Completed a Medicare Cost Reporting Period

Hospitals eligible to begin receiving CHGME PP funding without having completed a MCR period, must use the following methodology to convert a partial MCR period to a full one. To calculate the variables that follow below, the participating children’s hospitals must first determine the number of days in which the hospital has been eligible to receive CHGME PP funding (its period of eligibility for CHGME PP funding).

Determining the Period of Eligibility

For the initial application process, the period of eligibility is equal to the number of days from the date the hospital became eligible to participate in the CHGME PP to the CHGME PP initial application deadline date. The start date for hospitals that are training residents from an existent program is the effective date of the affiliation agreement for the aggregate cap, established for purposes of the CHGME PP. For new hospitals starting a new residency program, the start date is the date on which the hospital first trains residents.

For the reconciliation application process, the hospital will report the actual resident FTE count from the most recently filed (or most recently completed) MCR. If the hospital has not filed (or completed) an MCR period by the CHGME PP reconciliation application deadline, the period of eligibility is equal to the number of days from the beginning of the FY for which payments are being made (October 1) to the CHGME PP reconciliation application deadline date.

Example:

CACC became a freestanding children’s hospital when it received its own Medicare provider number (55-3300) on January 1, 2003. CACC has a June 30^th MCR year-end. On July 1, 2003 CACC began training residents previously trained at a hospital that has never received funding from the CHGME PP. The FY 2004 CHGME PP application deadline is August 1, 2003. CACC’s period of eligibility for the initial application is July 1, 2003 to July 30, 2003. Hence, the resident FTE counts and all other data reported in CACC’s CHGME PP initial application will be based on this period (7/1/03 through 7/30/03). CACC will follow the instructions provided herein to calculate its resident FTE counts, CMI, etc. for an incomplete cost reporting period. CACC’s CHGME PP funding will not be based upon a rolling-average until three (3) MCR periods have been completed.

The reconciliation application deadline is May 1, 2004. CACC will not complete its first MCR period until June 30, 2004. Consequently, CACC’s period of eligibility for the reconciliation application will be October 1, 2003 through May 1, 2004.

The following methodology should be used to convert relevant data from a partial MCR period to a full MCR period.

Calculating the Resident FTE Count for an Incomplete Cost Reporting Period

To convert the resident FTE count from a partial MCR period to a full MCR period:

Determine the hospital’s period of eligibility.
Count the actual (“raw”) number of unweighted allopathic and osteopathic resident FTEs during the hospital’s period of eligibility.
Divide the unweighted resident FTE count for allopathic and osteopathic residents (number 2 above) by the number of days in during the hospital’s period of eligibility (number 1 above). This number is the average number of unweighted resident FTEs per day.
Multiply the average number of unweighted resident FTEs (number 3 above) by the number of days that your hospital will be training residents during the FY in which payments are being made. This number is the estimated number of unweighted allopathic and osteopathic resident FTEs trained per year.
Use the same methodology (steps 1-4 above) to determine the weighted resident FTE count of allopathic and osteopathic residents. The example below includes the calculation of the weighted resident FTE count.
Use the same methodology (steps 1-4 above) to determine the unweighted and weighted resident FTE count for dental and podiatric residents.

The concept of converting a partial MCR period into a full MCR period is consistent with Medicare regulations. Since the CHGME PP is paying hospitals for training residents during the FY for which payments are being made, the Program will convert a partial training period to reflect the amount of time the hospital will training residents during the FY for which payments are being made. Although this methodology delineates the method by which partial year residents are counted, it is important to note that all counts are subjected to the cap set by the affiliation agreement.

Example:

CACC received its unique Medicare provider number (in the 3300 series) classifying it as a children’s hospital on January 1, 2003. CACC did not begin training residents until Shirley Temple Medical Center transferred its pediatric residents to CACC on July 1, 2003 at which time it met all CHGME PP hospital eligibility criteria. CACC has an affiliation agreement with Shirley Temple Medical Center giving it an aggregate cap of 100 FTEs. Based upon its eligibility, CACC will apply for FY 2004 CHGME PP funding.

The number of days in which CACC was eligible to participate in the CHGME PP is 30 days (the number of days from July 1, 2003 to July 30, 2003). CACC chose to use July 30 as its “end date” to allow time for completing and validating its CHGME PP application and to ensure that the application was postmarked by the CHGME PP application deadline. CACC was not eligible to receive CHGME PP funding prior to July 1, 2003 because it was not training residents.
From July 1^st to July 30^th CACC trained a total of 10 unweighted resident FTEs and 8.5 weighted resident FTEs. This resident FTE count reflects the actual “raw” number of resident FTEs that CACC trained during July. [e.g., The normal workweek for a pediatric resident is 6 days. During the week of July 1 through July 7 CACC had one full-time resident in his IRP that worked 6/6 days (6/6 = 1 FTE) and one part-time FTE in her IRP that worked 4/6 days (4/6 = 0.67 FTE). Hence, the actual “raw” number of weighted and unweighted residents that CACC trained during the first week of July is 1.67 (1 + .67 = 1.67).]
The average unweighted resident FTE count per day is 0.3333 (10 resident FTEs/30 days = 0.3333) and the average weighted resident FTE count per day is 0.2833 (8.5 FTE residents/30 days = 0.2833).
Since CACC will be eligible for the CHGME PP and training residents every day of FY 2004 for which it is applying for CHGME PP funding (October 1, 2003 to September 30, 2004), CACC will report an “estimated annualized” unweighted FTE resident count of 121.65 [365 x 0.3333 = 121.65 (rounded from 121.6545)] and an “estimated annualized” weighted FTE count of 103.40 [ 365 x 0.2833= 103.40 (rounded from 103.4045]. Since CACC's unweighted FTE count is more than its FTE cap (of 100), CACC will have to reduce its FTE count using the methodology described under “Exceeding the Cap”.

Additional references:

42 CFR 413.77 (CMS)
CHGME PP, Federal Register Notice dated March 1, 2001 (66 FR 12940)

Applicable to the following application forms: HRSA-99-1, HRSA-99-2, and HRSA-99-4

Calculating the Case Mix Index (CMI) for an Incomplete Cost Reporting Period

Hospitals that have not completed a MCR period will report a CMI to the CHGME PP based upon the discharges during the hospital’s period of eligibility.

Example:

CACC received its unique Medicare provider (3300 series) number on January 1, 2003. CACC did not begin training residents until Shirley Temple Medical Center transferred its pediatric residents to CACC on July 1, 2003 at which time it met all CHGME PP hospital eligibility criteria. The number of days in which CACC was eligible to participate in the CHGME PP is 30 days (the number of days from July 1, 2003 to July 30, 2003). CACC chose to use July 30 as its “end date” to allow time for completing and validating its CHGME PP application and to ensure that the application was postmarked by the CHGME PP application deadline. CACC was not eligible to receive CHGME PP funding prior to July 1, 2003 because it was not training residents. Hence, CACC’s CMI will be based upon all discharges from July 1 to July 30 using the CMS DRG-version specified by the CHGME PP.

Additional references:

42 CFR 413.77 (CMS)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA 99-2

Calculating Discharges for an Incomplete Cost Reporting Period

Hospitals that have not completed a MCR period will report discharge data to the CHGME PP based upon discharges during the hospital’s period of eligibility using the following methodology:

Calculate the number of discharges during the hospital’s period of eligibility. This number represents the total number of discharges during the hospital’s period of eligibility.
Divide the total number of discharges by the number of days in during the hospital’s period of eligibility. This represents the average number of discharges per day.
Multiply the average number of discharges per day by the number of days in which the hospital is eligible to receive CHGME PP funding during the FY for which it is applying for funding.

Example:

The number of days in which CACC was eligible to participate in the CHGME PP is 30 days (the number of days from July 1, 2003 to July 30, 2003). CACC chose to use July 30 as its “end date” to allow time for completing and validating its CHGME PP application and to ensure that the application was postmarked by the CHGME PP application deadline. CACC was not eligible to receive CHGME PP funding prior to July 1, 2003 because it was not training residents.

CACC had 752 discharges from July 1 to July 30.
CACC’s average number of discharges per day is 25.07 (752 discharges/30 days = 25.0666).
Since CACC will be caring for patients as a freestanding children’s teaching hospital during the entire FY 2004 (October 1, 2003 – September 30, 2004) for which it is applying for CGGME PP funding, CACC will report 9,150 discharges on HRSA-99-2 [365 days x 25.07 discharges per day = 9,150.55 discharges (whole numbers only)].

Additional references:

42 CFR 413.77(e)(2) (CMS)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA 99-2

Calculating the Number of Available Beds for an Incomplete Cost Reporting Period

Hospitals that have not completed a MCR period will calculate their bed count by summing the total available bed count during the hospital’s period of eligibility.

Example:

During the period July 1 to July 30, 2003 CACC had 2,730 beds available to house pediatric inpatients and 910 bassinets available for healthy newborn babies. Therefore, the bed count is 91 beds per day (2,730 beds/30 days=91) as healthy newborn babies should be excluded from the reported available bed count.

Additional references:

42 CFR 413.77(e)(2) (CMS)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA 99-2

Calculating Inpatient Days for an Incomplete Cost Reporting Period

Hospitals that have not completed a MCR period will calculate their inpatient days by summing the daily midnight census during the hospital’s period of eligibility. Then the hospital divides that sum by the number of days in that period, resulting in the average midnight census. The hospital should then multiply the average midnight census with the number of days that the hospital is eligible for the CHGME PP during the FY in which payments are to be made.

Example:

From July 1 to July 30, the CACC had a total of 1,911 inpatient days, resulting in an average of 63.70 inpatients per day (1,911 inpatient days/30 days). Their inpatient day total for the FY would be 365 days x 64 inpatients per day = 23,360 inpatient days (must also use whole numbers).

Additional references:

42 CFR 413.77 (CMS)
CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Applicable to the following application forms: HRSA 99-2

Calculating Outpatient Services for an Incomplete Cost Reporting Period

Hospitals will not complete this section until a MCR period has been completed.

Additional references:

CHGME PP, Federal Register Notice dated July 20, 2001 (66 FR 37980)

Section XI

CHGME PP Application Form Instructions

Instructions for Completing HRSA 99

Hospital Demographic and Contact Information

The HRSA 99 must be completed in its entirety. All sections of this form must be completed unless otherwise specified. The form must contain original signatures. Faxed or photocopied signatures will not be accepted. Specific line item instructions are provided below.

Section	Instructions
1	Provide the official name, physical address, tax identification number, county where the hospital is physically located, Medicare provider number, D&B D-U-N-S number, and website of the applicant children’s hospital. Information regarding D&B D-U-N-S numbers can be obtained at 1-800-234-3867 or www.dnb.com.
2	Provide the complete name, title, mailing address, telephone number and email address of the person to be notified if the application is funded. All future correspondence will be mailed to this individual only (e.g., notice of award letters).
3	Provide the complete name, title, mailing address, telephone number, email address, and signature of the person authorized to sign for the applicant hospital. An original signature and date are required. This individual must be the same individual that signs form HRSA 99-3.
4	Provide the complete name, title, mailing address, telephone number, email address, and signature of the hospital’s Director of Graduate Medical Education. An original signature and date are required. If the hospital does not have a Director of GME, the individual who has oversight responsibility for residents participating in GME programs at the hospital should be identified.
5	Provide the complete name, title, mailing address, telephone number and email address of the person who can provide documentation in support of the information reported in the CHGME PP application for funding. Like all Federal programs, information submitted is subject to audit. All Resident FTE Assessment inquiries and related communications will be directed to this individual.
6	Provide the complete name, title, mailing address, telephone number, and email address of the person who prepared and/or completed this application package for the applicant hospital. This individual will be the person contacted if there are questions or issues related to the information submitted in the CHGME PP application for funding.

Instructions for Completing HRSA 99-1

Determination of Weighted and Unweighted Resident FTE Counts

All values entered on HRSA 99-1 must be taken to the hundredth place [two decimal points (e.g. 38.00 or 12.43)] and the standard rounding rules applied [if the number is .5 or greater then round up to the next number (e.g., 38.189 would be rounded to 38.19)].

Instructions for the Initial Application Cycle

GUIDE TO INSTRUCTIONS
The Section and Line Number that the instruct-ions apply to are identified in this area in the following table.	Hospitals that filed a full MCR for the subject cost reporting period must follow the instructions provided in this (left) column for each section. Where specified, hospitals must report the data as stated in the hospital’s CMS 2552-96 Worksheets E-3, Part IV and E-3, Part VI from the subject cost reporting period. Deviation from what is stated on Worksheets E-3, Part IV and E-3, Part VI must be supported and attested to by the FI prior to submission of this application in order to be accepted by the CHGME PP. In some instances, the instructions are the same for all hospitals irrespective of the type of MCR the hospital filed for the subject cost reporting period. In those cases, only one set (i.e., one column) of instructions is provided.	Hospitals that filed a Low or No-Utilization MCR for the subject recent cost reporting period must follow the instructions provided in this (right) column for each section. In some instances, the instructions are the same for all hospitals irrespective of the type of MCR the hospital filed for the subject cost reporting period. In those cases, only one set (i.e., one column) of instructions is provided.

Hospitals that have not completed at least three (3) MCR periods must follow the instructions provided in italics, where provided below.

Section 1	DETERMINATION OF RESIDENT FTE CAP FOR THE HOSPITAL’S MOST RECENT COST REPORTING PERIOD ENDING ON OR BEFORE DECEMBER 31, 1996

Hospitals that did not train residents during the most recent cost reporting period ending on or before December 31, 1996 should enter “N/A” on lines 1.01 through 1.03.
1.01	Enter the inclusive dates of the subject cost reporting period. The following format must be used: (From:) mm/dd/yyyy (To:) mm/dd/yyyy.
1.02	Enter the status of the subject MCR using the codes below:			Enter the status of the subject MCR using the codes below:

	Code	Definition		Code		Definition

	S	Settled. This status refers to cost reports that have been settled [a notice of program reimbursement (NPR) issued] by the Medicare FI.		L		Low-utilization MCR. This status refers to resident FTE counts submitted by the hospital in their initial application that have not been assessed by the CHGME FI.

S/R/P	Settled/Reopened/Preliminary FI. This status refers to cost reports that have been settled (an NPR issued by the Medicare FI), then re-opened by the Medicare FI and any changes (to the resident FTE counts during the reopening) have been assessed by the CHGME (or Medicare) FI.		N		No-utilization MCR. This status refers to resident FTE counts submitted by the hospital in their initial application that have not been assessed by the CHGME FI.
S/R/RS	Settled/Reopened/Resettled. This status refers to cost reports that have been settled (an NPR issued by the Medicare FI), re-opened by the Medicare FI, and then re-settled by the Medicare FI.		C		Complete. This status refers to resident FTE counts that have been assessed by the CHGME FI and reported to the hospital and the CHGME PP in the CHGME FI’s final assessment report.

R		Re-issue. This status refers to resident FTE counts reported in a CHGME FI’s final assessment report that have been re-assessed based on a request from the children’s hospital or the CHGME FI and the results of the reassessment reported to the hospital and the CHGME PP in the CHGME FI’s final re-assessment report.
1.03	Enter the unweighted resident FTE count for allopathic and osteopathic programs for the most recent cost reporting period ending on or before December 31, 1996. (Worksheet E-3, Part IV Line 3.01 on the hospital’s MCR beginning on or after October 1, 1997.)			Enter the unweighted resident FTE count for allopathic and osteopathic programs for the most recent cost reporting period ending on or before December 31, 1996.
Hospitals must complete Sections 4 through 6 of Form HRSA-99-1 prior to completing Sections 2 and 3.
Section 2	AVERAGE UNWEIGHTED RESIDENT FTE COUNT
2.01	Enter the amount from line 4.19 of the 1996 Cap Year column.
2.02	Enter the amount from line 5.19 of the 1996 Cap Year column. Hospitals that have not completed three (3) MCR periods should enter “N/A”.
2.03	Enter the amount from line 6.19 of the 1996 Cap Year column. Hospitals that have not completed three (3) MCR periods should enter “N/A”.
2.04	Enter the sum of lines 2.01, 2.02 and 2.03 from above divided by 3. Hospitals that have not completed three (3) MCR periods should enter the amount from line 2.01 above.
2.05	Enter the unweighted number of resident FTEs in the initial years of all programs that meet the rolling average exception criteria in 42 CFR 413.79(d).
2.06	Enter the sum of lines 2.04 and 2.05 from above.
2.07	Enter the amount from line 4.19 of the §422 of the MMA column.
2.08	Enter the sum of lines 2.06 and 2.07 from above.
Section 3	AVERAGE WEIGHTED RESIDENT FTE COUNT
3.01	Enter the amount from line 4.20 of the 1996 Cap Year column.
3.02	Enter the amount from line 5.20 of the 1996 Cap Year column. Hospitals that have not completed three (3) MCR periods should enter “N/A”.
3.03	Enter the amount from line 6.20 of the 1996 Cap Year column. Hospitals that have not completed three (3) MCR periods should enter “N/A”.
3.04	Hospitals that have not completed three (3) MCR periods should enter the amount from line 3.01 above.

Enter the sum of lines 3.15 and 3.21 from CMS 2552-96 Worksheet E-3, Part IV from your most recently filed MCR which is equivalent to the sum of lines 3.01, 3.02 and 3.03 from above divided by 3. If the sum of lines 3.01 through 3.03 divided by 3 does not equal the sum of lines 3.15 and 3.21 from CMS 2552-96 on your most recently filed MCR, please contact your regional manager immediately.			Enter the sum of lines 3.01, 3.02 and 3.03 from above divided by 3.
3.05	Hospitals that have not completed three (3) MCR periods should enter the weighted number of resident FTEs in the initial years of all programs that meet the rolling average exception criteria in 42 CFR 413.79(d).

Enter the weighted number of resident FTEs in the initial years of all programs that meet the rolling average exception criteria in 42 CFR 413.79(d) .			Enter the weighted number of resident FTEs in the initial years of all programs that meet the rolling average exception criteria in 42 CFR 413.79(d) .
3.06	Hospitals that have not completed three (3) MCR should enter the sum of lines 3.04 and 3.05 from above. This is the weighted resident FTE count.

Enter the sum of lines 3.04 and 3.05 from above.
3.07	Enter the amount from line 4.20 of the §422 of the MMA column.
3.08	Enter the sum of lines 3.06 and 3.07 from above.
Section 4	DETERMINATION OF RESIDENT FTE COUNT FOR THE HOSPITAL’S MOST RECENTLY COMPLETED COST REPORTING PERIOD

Hospitals that have not completed a MCR period must use the methodology described in the application guidance section titled “Special Calculation Instructions for Hospitals that Have Not Completed a Medicare Cost Reporting Period” to determine their weighted and unweighted resident FTE counts based upon an incomplete cost reporting period.
4.01	Enter the inclusive dates of the subject cost reporting period. The following format must be used: (From:) mm/dd/yyyy (To:) mm/dd/yyyy.

Hospitals that have not completed a full MCR period must enter the date in which the hospital became eligible to participate (i.e. date that the hospital obtained a Medicare provider number and began training residents) and the CHGME PP application deadline. This is the hospital’s period of eligibility.
4.02	Enter the status of the subject MCR using the codes below:		Enter the status of the subject MCR using the codes below:

	Code	Definition	Code		Definition

	AF	As Filed. This status refers to cost reports that have been submitted by the children’s hospital to the Medicare FI, but have not yet been reviewed by the CHGME (or Medicare) FI.	L		Low-utilization MCR. This status refers to resident FTE counts submitted by the hospital in their initial application that have not been assessed by the CHGME FI.

	AM	Amended. This status refers to cost reports that have been amended and submitted by the children’s hospital to the Medicare FI, but have not yet been reviewed by the CHGME (or Medicare) FI.	N		No-utilization MCR. This status refers to resident FTE counts submitted by the hospital in their initial application that have not been assessed by the CHGME FI.

P	Preliminary. This status refers to resident FTE counts that have been assessed by the CHGME (or Medicare) FI where the cost report has not yet been settled (notice of program reimbursement has not been issued).	C		Complete. This status refers to resident FTE counts that have been assessed by the CHGME FI and reported to the hospital and the CHGME PP in the CHGME FI’s final assessment report.
S	Settled. This status refers to cost reports that have been settled [an NPR issued] by the Medicare FI.	R		Re-issue. This status refers to resident FTE counts reported in a CHGME FI’s final assessment report that have been re-assessed based on a request from the children’s hospital or the CHGME FI and the results of the reassessment reported to the hospital and the CHGME PP in the CHGME FI’s final re-assessment report.

S/R/P	Settled/Reopened/Preliminary FI. This status refers to cost reports that have been settled (an NPR issued by the Medicare FI), then re-opened by the Medicare FI and any changes (to the resident FTE counts during the reopening) have been assessed by the CHGME (or Medicare) FI.
S/R/RS	Settled/Reopened/Resettled. This status refers to cost reports that have been settled (an NPR issued by the Medicare FI), re-opened by the Medicare FI, and then re-settled by the Medicare FI.
4.03	1996 cap year column: Enter the unweighted resident FTE count for allopathic and osteopathic programs for the most recent cost reporting period ending on or before December 31, 1996 which is equivalent to Line 3.01 Line 3.01 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR. For hospitals whose MCR did not contain an entry on line 3.01, enter “0”. If Line 3.01 from Worksheet E-3, Part IV does not equal line 1.03 from above, line 3.01 from Worksheet E-3, part IV must be supported and attested to by the FI prior to submission of this application in order to be accepted by the CHGME PP.		1996 cap year column: Enter the unweighted resident FTE count for allopathic and osteopathic programs for the most recent cost reporting period ending on or before December 31, 1996 which is equivalent to Line 1.03 from above.
4.04	Enter the unweighted resident FTE count for allopathic and osteopathic programs which meet the criteria for an adjustment to the cap for new programs in accordance with 42 CFR 413.79(e) which is equivalent to Line 3.02 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR.		Enter the unweighted resident FTE count for allopathic and osteopathic programs which meet the criteria for an add-on to the cap for new programs in accordance with 42 CFR 413.79(e) for the subject cost reporting period.
4.05	Enter the adjustment (increase or decrease) for the unweighted resident FTE count for allopathic or osteopathic programs for affiliated programs in accordance with 42 CFR 413.75(b), 413.79(c)(2)(iv), and 63 FR 26336 of May 12, 1998 which is equivalent to Line 3.03 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR.		Enter the adjustment (increase or decrease) for the unweighted resident FTE count for allopathic or osteopathic programs for affiliated programs in accordance with 42 CFR 413.75(b), 413.79(c)(2)(iv), and 63 FR 26336 of May 12, 1998 for the subject cost reporting period.
4.06	1996 cap year column: Enter the sum of lines 4.03 through 4.05. This is the FTE adjusted cap which is equivalent to Line 3.04 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR. If the hospital’s 1996 Base Year Cap is reduced under 42 CFR 413.79(c)(3) due to unused resident slots, effective for cost reporting periods ending on or after July 1, 2005, Line 3.04 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR is equivalent to the sum of Line 3.03 from CMS 2552-96 Worksheet E-3, Part IV and Line 4 from Worksheet E-3, Part VI from the subject MCR.		1996 cap year column: Enter the sum of lines 4.03 through 4.05 from above. This is the FTE adjusted cap. If the hospital’s 1996 Base Year Cap is reduced under 42 CFR 413.79(c)(3) due to unused resident slots, effective for cost reporting periods ending on or after July 1, 2005, enter Line 3.04 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR which is equivalent to the sum of Line 3.03 from CMS 2552-96 Worksheet E-3, Part IV and Line 4 from Worksheet E-3, Part VI from the subject MCR. If the hospital was not required to file CMS 2552-96 Worksheets E-3, Part IV or E-3, Part VI following the 1996 Base Year Cap reduction under 42 CFR 413.79(c)(3) for the subject cost reporting period contact your regional manager.

§422 of the MMA column: Enter the number of unweighted allopathic and osteopathic GME FTE resident cap slots the hospital received under 42 CFR 413.79(c)(4) which is equivalent to Line 5.01 from CMS 2552-96 Worksheet E-3, Part VI from the subject MCR. If the hospital received GME FTE resident cap slots under 42 CFR 413.79(c)(4), but was not required to file CMS 2552-96 Worksheets E-3, Part VI for the subject cost reporting period contact your regional manager. If the hospital did not receive GME FTE resident cap slots under 42 CFR 413.79(c) enter “zero” on Lines 4.06 through 4.13, 4.19 and 4.20 of this column.
4.07	1996 cap year column: Enter the unweighted resident FTE count for allopathic or osteopathic programs for the current year from your records, other than those in the initial years of the program that meet the criteria for an exception to the rolling average rules (42 CFR 413.79(d) and/or (e)). This is equivalent to Line 3.05 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR.		1996 cap year column: Enter the unweighted resident FTE count for allopathic or osteopathic programs for the current year from your records, other than those in the initial years of the program that meet the criteria for an exception to the rolling average rules (42 CFR 413.79(d) and/or (e)).

§422 of the MMA column: Enter the sum of Lines 4.07 minus 4.08 from the 1996 Cap Year Column.
4.08	1996 cap year column: Enter line 3.06 from CMS 2552-96 Worksheet E-3, Part IV from the subject MCR.		1996 cap year column: Enter the lesser of lines 4.06 or 4.07 from above (lesser of lines 5.06 or 5.07 for Section 5 and lines 6.06 or 6.07 for Section 6).

§422 of the MMA column: enter the lesser of Lines 4.06 or 4.07 from above.
4.09	1996 cap year column: Enter the unweighted FTE resident count for allopathic and osteopathic residents in their initial residency period.

§422 of the MMA column: Enter the unweighted FTE resident count for allopathic and osteopathic residents in their initial residency period.
4.10	1996 cap year column: Enter the hospital’s unweighted FTE resident count for allopathic and osteopathic residents beyond their initial residency period. The sum of lines 4.09 and 4.10 should equal line 4.07 from above (the sum of lines 5.09 and 5.10 should equal line 5.07 for Section 5 and the sum of lines 6.09 and 6.10 should equal line 6.07 for Section 6).

§422 of the MMA column: Enter the hospital’s unweighted FTE resident count for allopathic and osteopathic residents beyond their initial residency period. The sum of lines 4.09 and 4.10 should equal line 4.07 from above.
4.11	1996 cap year column: Multiply line 4.10 from above (line 5.10 for Section 5 and line 6.10 for Section 6) by 0.5 and enter the product. This is the weighted FTE resident count for allopathic and osteopathic residents beyond their initial residency period.

§422 of the MMA column: Multiply line 4.10 from above by 0.5 and enter the product. This is the weighted FTE resident count for allopathic and osteopathic residents beyond their initial residency period.
4.12	1996 cap year column: Enter line 3.09 from CMS 2552-96 Worksheet E-3, Part IV. This should equal the sum of lines 4.09 and 4.11 from above.		1996 cap year column: Enter the sum of lines 4.09 and 4.11 from above (sum of lines 5.09 and 5.11 for Section 5 and lines 6.09 and 6.11 for Section 6). This is the total weighted resident FTE count for allopathic and osteopathic programs.

§422 of the MMA column: Enter the sum of lines 4.09 and 4.11 from above.
4.13	1996 cap year column: Enter line 3.10 from CMS 2552-96 Worksheet E-3, Part IV.		1996 cap year column: For Section 4: If line 4.07 is less than or equal to line 4.06 enter the amount from line 4.12 above. If line 4.07 is greater than line 4.06, multiply line 4.12 by (line 4.06 divided by line 4.07) and enter the product. For Section 5: If line 5.07 is less than or equal to line 5.06 enter the amount from line 5.12 above. If line 5.07 is greater than line 5.06, multiply line 5.12 by (line 5.06 divided by line 5.07) and enter the product. For Section 6: If line 6.07 is less than or equal to line 6.06 enter the amount from line 6.12 above. If line 6.07 is greater than line 6.06, multiply line 6.12 by (line 6.06 divided by line 6.07) and enter the product.

§422 of the MMA column: If line 4.07 is less than or equal to line 4.06, enter the amount from line 4.12 above. If line 4.07 is greater than line 4.06, multiply line 4.12 by (line 4.06 divided by line 4.07) and enter the product.
4.14	1996 cap year column: Enter the unweighted resident FTE count for dental and podiatric programs.
4.15	1996 cap year column: Enter the unweighted resident FTE count for dental and podiatric residents in their initial residency period.
4.16	1996 cap year column: Enter the unweighted resident FTE count for dental and podiatric residents beyond their initial residency period.
4.17	1996 cap year column: Multiply line 4.16 from above (line 5.16 for Section 5 and line 6.16 for Section 6) by 0.5 and enter the product.
4.18	1996 cap year column: Enter line 3.11 from CMS 2552-96 Worksheet E-3, Part IV. This should equal the sum of lines 4.15 and 4.17. For hospitals who’s MCR did not contain an entry on line 3.11 on Worksheet E-3, Part IV enter the sum of lines 4.15 and 4.17 from above (the sum of lines 5.15 and 5.17 for Section 5 and lines 6.15 and 6.17 for Section 6). This is the total weighted resident FTE count for dental and podiatric programs.		1996 cap year column: Enter the sum of lines 4.15 and 4.17 from above (the sum of lines 5.15 and 5.17 for Section 5 and lines 6.15 and 6.17 for Section 6). This is the total weighted resident FTE count for dental and podiatric programs.
4.19	1996 cap year column: Enter the sum of lines 4.08, 4.15 and 4.16 from above (the sum of lines 5.08, 5.15 and 5.16 for Section 5 and the sum of lines 6.08, 6.15 and 6.16 for Section 6). This is the hospital’s total unweighted FTE resident count.

§422 of the MMA column: Enter line 4.08 from above.
4.20	1996 cap year column: Enter the sum of lines 3.10 and 3.11 from CMS 2552-96 Worksheet E-3, Part IV. This should equal the sum of lines 4.13 and 4.18 (sum of lines 5.13 and 5.18 for Section 5 and the sum of lines 6.13 and 6.18 for Section 6).		1996 cap year column: Enter the sum of lines 4.13 and 4.18 from above (sum of lines 5.13 and 5.18 for Section 5 and the sum of lines 6.13 and 6.18 for Section 6). This is the hospital’s total weighted FTE resident count.

§422 of the MMA column: Enter line 4.13 from above.
Section 5	DETERMINATION OF RESIDENT FTE COUNT FOR THE HOSPITAL’S PRIOR COST REPORTING PERIOD

	The direct GME FTE resident cap slots hospitals received under 42 CFR 413.79(c)(4) are not subject to the three year rolling average; therefore, Section 5 does not include a §422 of the MMA column and related guidance is not applicable this section.
Hospitals that have not completed three (3) MCR periods should enter “N/A” on lines 5.01 through 5.20.
Section 6	DETERMINATION OF FTE RESIDENT COUNT FOR THE HOSPITAL’S PENULTIMATE COST REPORTING PERIOD

	The direct GME FTE resident cap slots hospitals received under 42 CFR 413.79(c)(4) are not subject to the three year rolling average; therefore, Section 6 does not include a §422 of the MMA column and related guidance is not applicable this section.
Hospitals that have not completed three (3) MCR periods should enter “N/A” on lines 6.01 through 6.20.

Instructions for the Reconciliation Application Cycle

All children’s hospitals, regardless of their filing status, will use the resident FTE counts as reported by their CHGME FI in his/her final Resident FTE Assessment Report to complete their reconciliation application which includes an updated and revised, as needed, HRSA 99-1. For additional information regarding the Resident FTE Assessment Program see Section II.

Instructions for Completing HRSA 99-2

Determination of Indirect Medical Education Data

Related to the Teaching of Residents

Inpatient Data for the Current Medicare Cost Report (MCR) Period The “current” MCR period is defined as the hospital’s most recently filed MCR for hospitals that file full MCRs (report residents to Medicare on CMS 2552-96, Worksheet E-3, Part IV) or the most recently completed MCR period for hospitals that file low or no-utilization MCRs. Hospitals that have not completed a full MCR period must use the methodology described in the application guidance section titled “Special Calculation Instructions for Hospitals that Have Not Completed a Medicare Cost Reporting Period” to complete the below.
1.01	Inclusive dates of the current MCR period. Enter the inclusive dates of the MCR period reported on line 4.01 of HRSA 99-1.
1.02	Number of Inpatient Days. The sum of the entire midnight census counts including nursery days for the MCR period reported on line 1.01 above. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.03	Number of Inpatient Discharges. The sum of all inpatient discharges including healthy newborns for the MCR period reported on line 1.01 above. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.04	Case Mix Index (CMI). The CMI is the sum of the diagnosis-related group (DRG) weights for all discharges during the MCR period identified on line 1.01 above divided by the number of discharges. The CMI represents the average DRG relative weight for the hospital. All hospitals must submit a CMI on all patient discharges using the appropriate CMS DRG version, excluding healthy newborns. [Value must be taken to 4 decimal points (i.e., 1.2105).] The CMI is utilized in the IME formula to determine IME payments. Hospitals that do not submit a CMI are not eligible for IME payments. These hospitals are required to initial the appropriate box on line 1.04 of HRSA 99-2 acknowledging their ineligibility for IME payments. The initials on HRSA 99-2 must be consistent with the signature on HRSA 99-3.
Intern/Resident-to-Bed (IRB) Ratio To comply as closely as possible with Medicare rules and regulations, the Department applies a cap on the IRB ratio, similar to the cap applied by the Medicare program pursuant to regulations at 42 CFR 412.105(a)(1), whereby the ratio may not exceed the ratio for the hospital's most recent prior cost reporting period. For those hospitals whose IRB ratio changes, there will be a one-year delay in the implementation of the revised IRB. Starting in FY 2002 the CHGME PP will implement a cap on the IRB ratio. The IRB cap may not exceed the ratio for the hospital’s previous cost reporting period.
Calculate the IRB Ratio for the Current MCR Period The “current” MCR period is defined as the hospital’s most recently filed MCR for hospitals that file full MCRs (report residents to Medicare on CMS 2552-96, Worksheet E-3, Part IV) or the most recently completed MCR period for hospitals that file low or no-utilization MCRs. Hospitals that meet the criteria for an exception or adjustment to the cap should refer to the Centers for Medicare and Medicaid Services August 1, 2001 Federal Register Notice (66 FR 39878) which provides additional information and guidance in calculating the IRB ratio.
1.05	Enter the 3-year adjusted unweighted FTE rolling average for the current MCR period. The 3-year unweighted FTE rolling average for the current MCR period is equal to line 2.06 of HRSA 99-1. Enter the data reported on line 2.06 of HRSA 99-1. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.06	Enter the bed count for the current MCR period. The bed count for the current MCR period is the sum of all available beds per day in the cost reporting period, excluding beds and bassinets in the healthy newborn nursery, divided by the number of days in that period. If a children’s hospital has not completed a Medicare cost report period prior to submission of an application to the CHGME PP, it would base the bed count on the sum of all available beds per day, excluding beds and bassinets in the healthy newborn nursery, in the period from the day it became eligible for the CHGME program until the CHGME application deadline, divided by the number of days in that period. A bed is any bed that is permanently maintained for lodging inpatients. The bed count number is utilized in the IME formula to determine IME payments. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.07	Enter the IRB ratio for the current MCR period. The IRB ratio is equal to the 3-year unweighted rolling average (line 1.05 above) divided by the bed count (line 1.06 above). [Value must be taken to six decimal points (i.e. 34.567800).]
Calculate the IRB Ratio for the Previous MCR Period The “previous” MCR period refers to the annual cost reporting period that ended one year prior to the cost reporting period identified on line 1.01 above. The previous MCR period should equal line 5.01 of HRSA 99-1 Hospitals that were not required to complete section 5 of HRSA 99-1 should contact their regional manager for additional information and guidance for lines 1.08 through 1.11 below. Hospitals that meet the criteria for an exception or adjustment to the cap should refer to the Centers for Medicare and Medicaid Services August 1, 2001 Federal Register Notice (66 FR 39878) which provides additional information and guidance in calculating the IRB ratio.
1.08	Inclusive dates of the previous MCR period. Enter the inclusive dates of the MCR period reported on line 5.01 of HRSA 99-1.
1.09	Unweighted FTE count for the previous MCR period. Enter the unweighted FTE count for the previous MCR period which is equal to line 5.19 of HRSA 99-1. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.10	Bed count for the previous MCR period. Calculate the available bed count for the previous MCR period. The bed count for the previous MCR period is the sum of all available beds per day in the cost reporting period, excluding beds and bassinets in the healthy newborn nursery, divided by the number of days in that period. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.11	IRB ratio for the previous MCR period. Calculate the IRB ratio for the previous MCR period. The IRB ratio is equal to the unweighted FTE count for the previous MCR period (line 1.09 above) divided by the bed count (line 1.10 above). [Value must be taken to six decimal points (i.e. 34.567890 or 12.540000).]
IRB Cap
1.12	IRB Cap. Enter the lesser of 1.07 or 1.11. [Value must be taken to six decimal points (i.e. 34.567890.]
§422 of the MMA IRB Ratio for the Current MCR Period
1.13	§422 of the MMA unweighted resident FTE count for the current MCR period. The unweighted resident FTE count for the current MCR period is equal to line 4.19 of the §422 of the MMA column of the HRSA 99-1. Enter the data reported on line 4.19 from the §422 of the MMA column of HRSA 99-1. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.14	Bed count for the current MCR period. Enter the available bed count for the current MCR period. This should be consistent with the data reported in line 1.06 above. [Value must be taken to two decimal points (i.e., 38.00 or 12.43).]
1.15	§422 of the MMA IRB ratio for the current MCR period. Calculate the §422 of the MMA IRB ratio for the current MCR period. The §422 of the MMA IRB ratio is equal to the increase in the unweighted FTE count (line 1.13 above) divided by the bed count (line 1.14 above). [Value must be taken to six decimal points (i.e., 34.567890 or 12.540000).]
Outpatient Data
1.16	Number of Ambulatory Surgery Visits. Total number of scheduled outpatient ambulatory surgical visit provided to patients who do not remain in the hospital overnight. The surgery may be performed in operating suites also used for inpatient surgery specifically designed surgical suites for outpatient surgery, or procedure rooms within an outpatient care facility.
1.17	Number of Radiology Visits. Total number of diagnostic radiology visits provided to patients in the outpatient setting such as computed tomographic scanner (CT scan), magnetic resonance imaging (MRI), position emission tomography (PET), Single photon emission computerized tomography (SPECT), and ultrasound. (Do not include inpatient testing)
1.18	Number of Urgent Care Visits. Total number of urgent care visits that provide care and treatment for problems that are not life threatening but require attention over the short term.
1.19	Number of Emergency Department Visits. Total number of emergency room visits for patients whose condition requires immediate care.
1.20	Number of Clinic Visits. Total number of clinic visits to each specialized medical unit responsible for the diagnosis and treatment of patients on an outpatient, non-emergency basis. Visits to the satellite clinics and primary group practices should be included if revenue is received by the hospital.

Instructions for Completing HRSA 99-3

Hospital Certification

A certification statement must be completed and signed by the applicant hospital’s certifying official attesting to the legitimacy of the application for funds under the CHGME PP. By signing the certification statement, the applicant hospital agrees to adhere to all the conditions listed and is aware that the applicant hospital may be denied entry to or revoked from the program if any conditions are violated.

The certification statement must contain an original signature. Faxed or photocopied signatures will not be accepted. The HRSA 99-3 should be signed by the individual authorized to sign for the application hospital on HRSA 99 (number 3).

As a part of the first certification statement, the required Assurances, Certifications and Other Requirements are included. The certifying official is certifying the applicant hospital has met the requirements and the necessary forms have been filed (see attached Assurances, Certifications and Other Requirements). If one or more of the following assurances, certifications and other requirements are not met, attach an explanation on plain white paper.

For assurances addressed in paragraphs A through D, contact the Voluntary Compliance and Outreach Division at (202) 619-2595, to obtain information and/or confirm the applicant hospital’s submission and acceptance by the Department of Health and Human Services (DHHS) Office for Civil Rights an Assurance of Compliance Form HHS 690.

Instructions for Completing HRSA 99-4

Government Performance and Results Act Tables

Hospitals must report data from the cost reporting period reflected on line 4.01 of HRSA 99-1

Table 1. Number of FTE Residents Supported by the Children’s

Hospitals in Approved Residency Training Programs

Note: Applicants requesting funding must submit the required data in the following format. This data is for residents rotating through both the inpatient and outpatient settings of the hospital. Resident FTE counts reported below should be unweighted and line 1.04 (below) should be consistent with the unweighted resident FTE counts reflected in Form HRSA 99-1 Section 4.

Line	Instructions
1.01	*Sponsored by the Children’s Hospital and Rotating at the Children’s Hospital.** Provide the number of FTE residents (general pediatric, subspecialty pediatric & fellows, and non-pediatric) training in your hospital and sponsored by your hospital during the cost reporting period.
1.02	Sponsored by the Children’s Hospital and Rotating at Non-provider Sites. Provide the number of FTE residents (general pediatric, subspecialty pediatric & fellows, and non-pediatric) sponsored by your hospital but are rotating to non-provider sites during the cost reporting period.
1.03	Sponsored by Other Hospitals and Rotating at the Children’s Hospital. Provide the number of FTE residents (general pediatric, subspecialty pediatric and fellows, and non-pediatric) sponsored by another hospital but are rotating to your hospital during the cost reporting period.
1.04	Total Number of FTE Residents. Provide the total number of FTE Residents from the sum of Lines 1.01 through 1.03 (above)
1.05	Sponsored by the Children’s Hospital and Rotating at Other Hospitals. Provide the number of FTE residents (general pediatric, subspecialty pediatric & fellows, and non-pediatric) sponsored by your hospital but are rotating to other hospitals during the cost reporting period.

Definitions
Sponsoring Institution	*CHGME PP defines a sponsoring institution as an institution, which assumes the ultimate responsibility for a graduate medical education program. According to the Accreditation Council for Graduate Medical Education (ACGME), the following are the institutional requirements for a Sponsoring Institution: 1) A residency program must operate under the authority and control of a sponsoring institution. 2) There must be a written statement of institutional commitment to GME that is supported by the governing authority, the administration, and the teaching staff. 3) Sponsoring institutions must be in substantial compliance with the Institutional Requirements and must ensure that their ACGME-accredited programs are in substantial compliance with the Program Requirements and the applicable Institutional Requirements. 4) An institution’s failure to comply substantially with the Institutional Requirements may jeopardize the accreditation of all of its sponsored residency programs.
General Pediatric Resident	Residents training in their initial residency period of a pediatric residency program
Subspecialty Pediatric Resident	Residents training beyond their initial residency period (i.e., fellows)
Non-Pediatric Resident	Residents training in their initial residency period not specifically in pediatrics (i.e., radiology, pathology, general surgery, dental)

Table 2. Hospital's Total and Operating Margins

Margin Types

Hospitals Filing Low or No-Utilization

Medicare Cost Reports

Hospitals Filing Full

Medicare Cost Reports

Total Margins

Total margin is defined as the net income from all sources [(net patient revenue + all other income)-[(total operating expenses + other expenses)] divided by total hospital revenues (net patient revenues + total other income) multiplied by 100

To calculate the total margin take Worksheet G-3 Line 31 and divide it by Line 3 + Line 25.

Operating Margins

The operating margin is defined as the net income from service to patients (net patient revenues – total operating expenses) divided by net patient revenues (total patient revenues – contractual allowances) multiplied by 100

To calculate the operating margin, take the number from Worksheet G-3 line 3, subtract the number from worksheet A Column 3 line 95, divide by the number from worksheet G-3, line 3 and multiply it by 100.

Table 3. Hospital’s Allowable Operating Expenses

Margin Types

Hospitals Filing Low or No-Utilization

Medicare Cost Reports

Hospitals Filing Full

Medicare Cost Reports

Total Allowable Operating Expenses

Contact the hospital’s fiscal intermediary to clarify what Medicare accepts as allowable operating expenses, if mechanism is not already identified in the hospital’s financial statements

The total allowable operating expenses can identified on the hospital’s Medicare cost report - Worksheet G-2 Part II Line 26

Table 4. Hospital’s Revenue and Expenses Attributed to Patient Care

Revenue/Expense Type	Inpatient	Outpatient
Hospital’s gross revenue attributed to Medicaid and SCHIP (Medicaid refers to any funding provided by Title XIX including that from Medicaid HMOs and DSH payments. SCHIP-State Children’s Health Insurance Program refers to funding provided under Title XXI).	Revenue received by the hospital from the Medicaid and SCHIP programs for inpatient care. Report as dollar amounts rather than percentages	Revenue received by the hospital from the Medicaid and SCHIP programs for outpatient care. Report as dollar amounts rather than percentages
Hospital’s gross revenue attributed to Medicare	Revenue received by the hospital from the Medicare for inpatient care. Report as dollar amounts rather than percentages	Revenue received by the hospital from the Medicare for outpatient care. Report as dollar amounts rather than percentages
Hospital’s gross revenue attributed to self-pay	Revenue received by the hospital directly from patients for inpatient care. Report as dollar amounts rather than percentages	Revenue received by the hospital directly from patients for outpatient care. Report as dollar amounts rather than percentages
Hospital ‘s gross revenue attributed to other sources	Revenue received by the hospital from other sources for inpatient care not listed above. Report as dollar amounts rather than percentages	Revenue received by the hospital from other sources for outpatient care not listed above. Report as dollar amounts rather than percentages
Hospital’s total gross revenue attributed to patient care	Total gross revenue received by the hospital for inpatient care (sum of inpatient columns 1-4). Report as dollar amounts rather than percentages.	Total gross revenue received by the hospital for outpatient care (sum of outpatient columns 1-4). Report as dollar amounts rather than percentages.
Hospital’s total expenses attributed to uncompensated care	Total expenses that the hospital attributes to uncompensated inpatient care. Report as dollar amounts rather than percentages.	Total expenses that the hospital attributes to uncompensated outpatient care. Report as dollar amounts rather than percentages.
Hospital’s total expenses attributed to charity care	Total expenses that the hospital attributes to charity care in the inpatient setting. Report as dollar amounts rather than percentages.	Total expenses that the hospital attributes to charity care in the outpatient setting. Report as dollar amounts rather than percentages.

Instructions for Completing HRSA 99-5

Application Checklist

The application checklist must be completed following the instructions provided on the checklist itself. All required forms and supporting documentation should be included in the application package mailed to the CHGME PP in the order that the forms and supporting documentation are listed on the checklist.

Section X

References

Commonly Used Acronyms

ACGME	ACCREDITATION COUNCIL FOR GRADUATE MEDICAL EDUCATION
AF	AS FILED
CH	CHILDREN'S HOSPITAL
CHGME	CHILDREN'S HOSPITALS GRADUATE MEDICAL EDUCATION
CMI	CASE MIX INDEX
CMS	CENTERS FOR MEDICARE AND MEDICAID SERVICES
D(G)ME	DIRECT (GRADUATE) MEDICAL EDUCATION
FEL	FELLOW
FI	FISCAL INTERMEDIARY
FY	FEDERAL FISCAL YEAR
FRN	FEDERAL REGISTER NOTICE
FTE	FULL-TIME EQUIVALENT
GME	GRADUATE MEDICAL EDUCATION
GPRA	GOVERNMENT PERFORMANCE AND RESULTS ACT OF 1993
HRSA	HEALTH RESOURCES AND SERVICES ADMINISTRATION
IME	INDIRECT MEDICAL EDUCATION
INT	INTERN
IRB	INTERN RESIDENT BED COUNT
IRP	INITIAL RESIDENCY PERIOD
MCR	MEDICARE COST REPORT
NBME	NATIONAL BOARD OF MEDICAL EXAMINERS
PGY1.	POST-GRADUATE YEAR (1,2,….)
PPS	PROSPECTIVE PAYMENT SYSTEM
RES (R)	RESIDENT (1,2,…)
USMLE	UNITED STATES MEDICAL LICENSING EXAMINATION
WI	WAGE INDEX

File Type	application/msword
File Title	INSTRUCTIONS FOR COMPLETING HRSA-99-1
Author	JCook
Last Modified By	HRSA
File Modified	2006-06-20
File Created	2006-03-28

Application Guidance - revised June 2006 as a result of Section 422 of the MMA