MEDICARE INPATIENT HOSPITAL PAYMENT ADJUSTMENT FOR LOW-VOLUME HOSPITALS.

SEC. 406. MEDICARE INPATIENT HOSPITAL PAYMENT ADJUSTMENT FOR LOW-VOLUME HOSPITALS.(a) In General.—Section 1886(d) (42 U.S.C. 1395ww(d)) is amended by adding at the end the following new paragraph:“(12) Payment adjustment for low-volume hospitals.—“(A) In general.—In addition to any payments calculated under this section for a subsection (d) hospital, for discharges occurring during a fiscal year (beginning with fiscal year 2005), the Secretary shall provide for an additional payment amount to each low-volume hospital (as defined in subparagraph (C)(i)) for discharges occurring during that fiscal year that is equal to the applicable percentage increase (determined under subparagraph (B) for the hospital involved) in the amount paid to such hospital under this section for such discharges (determined without regard to this paragraph).117 STAT. 2270“(B) Applicable percentage increase.—The Secretary shall determine an applicable percentage increase for purposes of subparagraph (A) as follows:“(i) The Secretary shall determine the empirical relationship for subsection (d) hospitals between the standardized cost-per-case for such hospitals and the total number of discharges of such hospitals and the amount of the additional incremental costs (if any) that are associated with such number of discharges.“(ii) The applicable percentage increase shall be determined based upon such relationship in a manner that reflects, based upon the number of such discharges for a subsection (d) hospital, such additional incremental costs.“(iii) In no case shall the applicable percentage increase exceed 25 percent.“(C) Definitions.—“(i) Low-volume hospital.—For purposes of this paragraph, the term ‘low-volume hospital’ means, for a fiscal year, a subsection (d) hospital (as defined in paragraph (1)(B)) that the Secretary determines is located more than 25 road miles from another subsection (d) hospital and has less than 800 discharges during the fiscal year.“(ii) Discharge.—For purposes of subparagraph (B) and clause (i), the term ‘discharge’ means an inpatient acute care discharge of an individual regardless of whether the individual is entitled to benefits under part A.”.(b) Judicial Review.—Section 1886(d)(7)(A) (42 U.S.C. 1395ww(d)(7)(A)) is amended by inserting after “to subsection (e)(1)” the following: “or the determination of the applicable percentage increase under paragraph (12)(A)(ii)”.