PROVISIONS RELATING TO ADJUSTMENTS TO STANDARDIZED AMOUNTS FOR WAGES AND WAGE-RELATED COSTS.

SEC. 101. PROVISIONS RELATING TO ADJUSTMENTS TO STANDARDIZED AMOUNTS FOR WAGES AND WAGE-RELATED COSTS. (a) Use of Occupational Mix in Guidelines for Determination of Area Wage Index.— (1) In general.— Section 1886(d)(10)(D)(i)(I) (42 U.S.C. 1395ww(d)(10)(D)(i)(I)) is amended by inserting “(to the extent the Secretary determines appropriate)” after “taking into account”. (2) Effective date.— The amendment made by paragraph (1) shall take effect as if included in the enactment of OBRA-1989. (b) Conforming Amendments Relating to Geographic Area Used To Determine Wage Index Applicable to Hospital.— (1) Section 1886(d)(8)(C) (42 U.S.C. 1395ww(d)(8)(C)), as amended by section 13501(b)(1) of OBRA-1993, is amended— (A) in clause (iv), by striking “paragraph (1)” and inserting “paragraph (10)”; and (B) by adding at the end the following new clause: “(v) This subparagraph shall apply with respect to discharges occurring in a fiscal year only if the Secretary uses a method for making adjustments to the DRG prospective payment rate for area differences in hospital wage levels under paragraph (3)(E) for the fiscal year that is based on the use of Metropolitan Statistical Area classifications.”. 108 STAT. 4401 (2) Section 1886(d)(10) (42 U.S.C. 1395ww(d)(10)) is amended— (A) in subparagraph (C)(i)(H), by striking “the area wage index applicable” and inserting “the factor used to adjust the DRG prospective payment rate for area differences in hospital wage levels that applies”; and (B) in subparagraph (D)— (i) by redesignating clause (ii) as clause (iii), and (ii) by inserting after clause (i) the following new clause: “(ii) Notwithstanding clause (i), if the Secretary uses a method for making adjustments to the DRG prospective payment rate for area differences in hospital wage levels under paragraph (3)(E) that is not based on the use of Metropolitan Statistical Area classifications, the Secretary may revise the guidelines published under clause (i) to the extent such guidelines are used to determine the appropriateness of the geographic area in which the hospital is determined to be located for purposes of making such adjustments.”. (c) Adjustment of Labor and Non-Labor Portions of Standardized Amounts.— Section 1886(d)(3)(A)(iii) (42 U.S.C. 1395ww(d)(3)(A)(iii)) is amended by adding at the end the following: “For discharges occurring on or after October 1, 1994, the Secretary shall adjust the ratio of the labor portion to non-labor portion of each average standardized amount to equal such ratio for the national average of all standardized amounts.”.