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61434 Federal Register / Vol. 70, No.

204 / Monday, October 24, 2005 / Notices

a one-year interim extension of the term COMMODITY FUTURES TRADING payment system should be addressed to
of U.S. Patent No. 4,650,787. COMMISSION the appropriate contractor.
Sunshine Act Meeting rule published on September 1, 1987 (52
Karin Ferriter by telephone at (571)
272–7744; by mail marked to her FR 32992) set forth the basic procedures
attention and addressed to Mail Stop used under the CHAMPUS DRG-based
Commodity Futures Trading payment system. This was subsequently
Patent Ext., Commissioner for Patents, Commission
P.O. Box 1450, Alexandria, VA 22313– amended by final rules published
FEDERAL REGISTER CITATION OF PREVIOUS August 31, 1988 (53 FR 33461), October
1450; by fax marked to her attention at
ANNOUNCEMENT: 70 FR 194. 21, 1988 (53 FR 41331), December 16,
(571) 273–7744, or by e-mail to
Karin.Ferriter@uspto.gov. PREVIOUSLY ANNOUNCED TIME AND DATE OF 1988 (53 FR 50515), May 30, 1990 (55
THE MEETING: 11 a.m., Wednesday, FR 21863), October 22, 1990 (55 FR
SUPPLEMENTARY INFORMATION: Section October 26, 2005. 42560), and September 10, 1998 (63 FR
156 of Title 35, United States Code, CHANGES IN THE MEETING: The Rule 48439). An explicit tenet of these final
generally provides that the term of a Enforcement Review has been moved to rules, and one based on the statute
patent may be extended for a period of Friday, October 28, 2005, at 11:45 a.m. authorizing the use of DRGs by
up to five years if the patent claims a TRICARE, is that the TRICARE DRG-
product, or a method of making or using based payment system is modeled on
Jean A. Webb, (202) 418–5100.
a product, that has been subject to the Medicare PPS, and that, whenever
certain defined regulatory review, and Jean A. Webb, practicable, the TRICARE system will
that the patent may be extended for Secretary of the Commission. follow the same rules that apply to the
interim periods of up to a year if the [FR Doc. 05–21319 Filed 10–20–05; 2:24 pm] Medicare PPS. The Centers for Medicare
regulatory review is anticipated to BILLING CODE 6351–01–M
and Medicaid Services (CMS) publishes
extend beyond the expiration date of the these changes annually in the Federal
patent. Register and discusses in detail the
On April 7, 2005, H3 Pharma, Inc., an DEPARTMENT OF DEFENSE impact of the changes. In addition, this
agent of the Administrators of the notice updates the rates and weights in
Tulane Educational Fund of New Office of the Secretary accordance with our previous final
Orleans, Louisiana, the patent owner, rules. The actual changes we are
timely filed an application under 35 TRICARE; Civilian Health and Medical making, along with a description of
U.S.C. 156(d)(5) for an interim extension Program of the Uniformed Services their relationship to the Medicare PPS,
of the term of U.S. Patent No. 4,650,787. (CHAMPUS); Fiscal Year 2006 are detailed below.
The patent claims the active ingredient Diagnosis Related Group (DRG) I. Medicare PPS Changes Which Affect
vapreotide acetate in the human drug Updates the TRICARE DRG-Based Payment
product Sanvar, and a method of use AGENCY: Office of the Secretary, DoD. System
of said product. The application Following is a discussion of the
ACTION: Notice of DRG revised rates.
indicates that a New Drug Application changes CMS has made to the Medicare
for Sanvar (vapreotide acetate) has SUMMARY: This notice describes the PPS that affect the TRICARE DRG-based
been filed and is currently undergoing changes made to the TRICARE DRG- payment system.
regulatory review before the Food and based payment system in order to
Drug Administration for permission to conform to changes made to the A. DRG Classifications
market or use the product commercially. Medicare Prospective Payment System Under both the Medicare PPS and the
Review of the application indicates (PPS). It also provides the updated fixed TRICARE DRG-based payment system,
that except for permission to market or loss cost outlier threshold, cost-to- cases are classified into the appropriate
use the product commercially, the charge ratios and the Internet address DRG by a Grouper program. The
subject patent would be eligible for an for accessing the updated adjusted Grouper classifies each case into a DRG
extension of the patent term under 35 standardized amount and DRG relative on the basis of the diagnosis and
U.S.C. 156, and that the patent should weights to be used for FY 2006 under procedure codes and demographic
be extended for one year as required by the TRICARE DRG-based payment information (that is, sex, age, and
35 U.S.C. 156(d)(5)(B). Since the system. discharge status). The Grouper used for
regulatory review period extended the TRICARE DRG-based payment
EFFECTIVE DATES: The rates, weights and
beyond the expiration date of the patent system is the same as the current
Medicare PPS changes which affect the Medicare Grouper with two
April 25, 2005, interim extension of the TRICARE DRG-based payment system
patent term under 35 U.S.C. 156(d)(5) is modifications. The TRICARE system has
contained in this notice are effective for replaced Medicare DRG 435 with two
appropriate. admissions occurring on or after age-based DRGs (900 and 901), and has
An interim extension under 35 U.S.C. October 1, 2005. implemented thirty-four (34) neonatal
156(d)(5) of the term of U.S. Patent No. ADDRESSES: TRICARE Management DRGs in place of Medicare DRGs 385
4,650,787 is granted for a period of one Activity (TMA), Medical Benefits and through 390. For admissions occurring
year from the expiration date of the Reimbursement Systems, 16401 East on or after October 1, 2001, DRG 435 has
patent, i.e., until April 25, 2006. Centretech Parkway, Aurora, CO 80011– been replaced by DRG 523. The
Dated: October 17, 2005. 9066. TRICARE system has replaced DRG 523
Jon W. Dudas, FOR FURTHER INFORMATION CONTACT: with the two age-based DRGs (900 and
Under Secretary of Commerce for Intellectual Marty Maxey, Medical Benefits and 901). For admissions occurring on or
Property and Director of the United States Reimbursement Systems, TMA, after October 1, 1995, the CHAMPUS
Patent and Trademark Office. telephone (303) 676–3627. Questions grouper hierarchy logic was changed so
[FR Doc. 05–21191 Filed 10–21–05; 8:45 am] regarding payment of specific claims the age split (age <29 days) and
BILLING CODE 3510–16–P under the TRICARE DRG-based assignments to MDC 15 occur before

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Federal Register / Vol. 70, No. 204 / Monday, October 24, 2005 / Notices 61435

assignment of the PreMDC DRGs. This E. Outlier Payments II. Cost to Charge Ratio
resulted in all neonate tracheostomies Since TRICARE does not include While CMS uses hospital-specific cost
and organ transplants to be grouped to capital payments in our DRG-based to charge ratios, TRICARE uses a
MDC 15 and not to DRGs 480–483 or payments (TRICARE reimburses national cost to charge ratio. For FY
495. For admissions occurring on or hospitals for their capital costs as 2006, the cost-to-charge ratio used for
after October 1, 1998, the CHAMPUS reported annually to the contractor on a the TRICARE DRG-based payment
grouper hierarchy logic was changed to pass through basis), we will use the system will be 0.4060, which is
move DRG 103 to the PreMDC DRGs and fixed loss cost outlier threshold increased to 0.4130 to account for bad
to assign patients to PreMDC DRGs 480, calculated by CMS for paying cost debts. This shall be used to calculate the
103 and 495 before assignment to MDC outliers in the absence of capital adjusted standardized amounts and to
15 DRGs and the neonatal DRGs. For prospective payments. For FY 2006, the calculate cost outlier payments, except
admissions occurring on or after fixed loss cost outlier threshold is based for children’s hospitals. For children’s
October 1, 2001, DRGs 512 and 513 on the sum of the applicable DRG-based hospital cost outliers, the cost-to-charge
were added to the PreMDC DRGs, payment rate plus any amounts payable ratio used is 0.4468. For FY 2006, the
between DRGs 480 and 103 in the for IDME plus a fixed dollar amount. neonatal cost-to-charge ratio of .64 is
TRICARE grouper hierarchy logic. For Thus, for FY 2006, in order for a case being reduced to the same cost-to-charge
admissions occurring on or after to qualify for cost outlier payments, the ratio of .4130 for acute care hospitals.
October 1, 2004, DRG 483 was deleted costs must exceed the TRICARE DRG
and replaced with DRGs 541 and 542, III. Updated Rates and Weights
base payment rate (wage adjusted) for
splitting the assignment of cases on the the DRG plus the IDME payment plus The updated rates and weights are
basis of the performance of a major $21,783 (wage adjusted). The marginal accessible through the Internet at http://
operating room procedure. The cost factor for cost outliers continues to www.tricare.osd.mil under the
description for DRG 480 was changed to be 80 percent. sequential headings TRICARE Provider
‘‘Liver Transplant and/or Intestinal Information, Rates and Reimbursements,
Transplant’’, and the description for F. National Operating Standard Cost as and DRG Information. Table 1 provides
DRG 103 was changed to ‘‘Heart/Heart a Share of Total Costs the ASA rates and Table 2 provides the
Lung Transplant or Implant of Heart The FY 2006 TRICARE National DRG weights to be used under the
Assist System’’. For FY 2006, CMS will Operating Standard Cost as a Share of TRICARE DRG-based payment system
implement classification changes, Total Costs (NOSCASTC) used in during FY 2006 and which is a result of
including surgical hierarchy changes. calculating the cost outlier threshold is the changes described above. The
The TRICARE Grouper will incorporate 0.923. TRICARE uses the same implementing regulations for the
all changes made to the Medicare methodology as CMS for calculating the TRICARE/CHAMPUS DRG-based
Grouper. NOSCASTC however, the variables are payment system are in 32 CFR Part 199.
B. Wage Index and Medicare different because TRICARE uses Dated: October 18, 2005.
Geographic Classification Review Board national cost to charge ratios while CMS L.M. Bynum,
Guidelines uses hospital specific cost to charge Alternate OSD Federal Register Liaison
ratios. Officer, Department of Defense.
TRICARE will continue to use the
same wage index amounts used for the G. Indirect Medical Education (IDME) [FR Doc. 05–21184 Filed 10–21–05; 8:45 am]
Medicare PPS. TRICARE will also Adjustment BILLING CODE 5001–06–M
duplicate all changes with regard to the Passage of the MMA of 2003 modified
wage index for specific hospitals that the formula multipliers to be used in the
are redesignated by the Medicare DEPARTMENT OF DEFENSE
calculation of the indirect medical
Geographic Classification Review Board. education IDME adjustment factor. Office of the Secretary
In addition, TRICARE will continue to Since the IDME formula used by
utilize the out commuting wage index TRICARE does not include Senior Executive Service Performance
adjustment. disproportionate share hospitals (DSHs), Review Board
C. Revision of the Labor-Related Share the variables in the formula are different
than Medicare’s however; the AGENCY: Department of Defense Office
of the Wage Index of the Inspector General.
percentage reductions that will be
TRICARE is adopting CMS’ applied to Medicare’s formula will also ACTION: Notice.
percentage of labor related share of the be applied to the TRICARE IDME
standardized amount. For wage index SUMMARY: This notice announces the
formula. The new multiplier for the
values greater than 1.0, the labor-related appointment of the members of the
IDME adjustment factor for TRICARE for
portion of the ASA shall equal 69.7 Senior Executive Service (SES)
FY 2006 is 1.04.
percent. For wage index values less than Performance Review Board (PRB) for the
or equal to 1.0 the labor-related portion H. Expansion of the Post Acute Care Department of Defense Office of the
of the ASA shall continue to equal 62 Transfer Policy Inspector General (DoD OIG), as
percent. For FY 2006 TRICARE is adopting required by 5 U.S.C. 4314(c)(4). The
CMS’ expanded post acute care transfer PRB provides fair and impartial review
D. Hospital Market Basket of SES performance appraisals and
policy according to CMS’ final rule
TRICARE will update the adjusted published August 12, 2005. makes recommendations regarding
standardized amounts according to the performance ratings and performance
final updated hospital market basket I. Blood Clotting Factor awards to the Inspector General.
used for the Medicare PPS for all For FY 2006, TRICARE is adopting DATES: October 20, 2005.
hospitals subject to the TRICARE DRG- CMS’ payment methodology for blood FOR FURTHER INFORMATION CONTACT: Mr.
based payment system according to clotting factor according to CMS’ final Michael Peterson, Director, Human
CMS’s August 12, 2005, final rule. rule published August 12, 2005. Capital Management Directorate, Office

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