Hospitals to Which the Payment Reduction Applies

10.6.2.1 - Hospitals to Which the Payment Reduction Applies (Rev. 1657, Issued: 12-31-08, Effective: 01-01-09, Implementation: 01-05-09) The reduction applies only to hospitals that are identified as “Subsection (d) hospitals.” “Subsection (d) hospitals” have the same definition for hospitals paid under the OPPS as for hospitals paid under the IPPS. Specifically, “Subsection (d) hospitals” are defined under Section 1886(d)(1)(B) of the Act as hospitals that are located in the 50 states or the District of Columbia other than those categories of hospitals or hospital units that are specifically excluded from the IPPS, including psychiatric, rehabilitation, long-term care, children’s and cancer hospitals or hospital units. In other words, the provision does not apply to hospitals and hospital units excluded from the IPPS or to hospitals located in Maryland, Puerto Rico or the U.S. territories. Hospitals that are not required to submit quality data (i.e., those that are not Subsection (d) hospitals) will receive the full OPPS update. Similarly, the reduced update will not apply to Subpart (d) hospitals that are not paid under the OPPS (e.g., Indian Health Service hospitals).