Medicare program; schedule of limits on hospital inpatient operating costs for cost reporting periods beginning on or after October 1, 1982--HCFA. Interim final notice with comment period.

This notice sets forth a schedule of limits on the hospital inpatient operating costs that may be reimbursed under Medicare for cost reporting periods beginning on or after October 1, 1982. These limits are needed to implement changes in the Medicare law that were made by section 101(a) of Pub. L. 97-248, the Tax Equity and Fiscal Responsibility Act of 1982. The new limits differ from the current per diem limits on inpatient general routine operating costs in several major respects. First, they are not restricted to costs of inpatient general routine care, but cover total inpatient operating costs, including the costs of general routine service, special care, and ancillary services. The new limits will be applied on a cost per discharge rather than cost per diem basis. Finally, they are adjusted to reflect differences in the mix of Medicare cases treated by each hospital. The limits are similar to the current limits in that they do not apply to outpatient service cost, capital-related costs, malpractice insurance costs, or costs a hospital allocates to the interns and residents (in approved programs) or nursing school cost centers on its Medicare cost report. They also do not apply to children's hospitals, long-term care hospitals, or rural hospitals with fewer than 50 beds. The notice explains our methodology for deriving and applying the new limits.