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HHS/CMS RIN: 0938-AI56 Publication ID: Spring 2001 
Title: Prospective Payment System for Hospital Outpatient Services (HCFA-1005-F) 
Abstract: The Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), enacted on August 5, 1997, provides for implementation of a Prospective Payment System (PPS) for hospital outpatient services (and for part B services furnished to inpatients who have no part A coverage) furnished on or after January 1, 1999. In the proposed rule published on September 8, 1998, HCFA indicated that implementation of the system would be delayed because of systems concerns. This system will also apply to partial hospitalization services furnished by community mental health centers. The BBA also requires a new method for calculating beneficiary copayments for the hospital outpatient services included under the PPS. The PPS will consist of about 340 groups of services, called "Ambulatory Payment Classifications" or APCs, that are related clinically and in terms of their resource use. We will assign a group weight to each group, based on the median cost (operating and capital) of the services included in the group. We will convert the weights for each group to payment rates using a national conversion factor, taking into account group weights and the projected volume of services for each group. In addition, this rule would establish the requirements for designating certain entities as provider-based or as a department of a hospital. 
Agency: Department of Health and Human Services(HHS)  Priority: Economically Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Completed Actions 
Major: Yes  Unfunded Mandates: Private Sector 
CFR Citation: 42 CFR 409.10    42 CFR 413    42 CFR 413.124    42 CFR 413.130    42 CFR 489.20    42 CFR 103.105    42 CFR 410.2    42 CFR 410.27    42 CFR 410.28    42 CFR 410.30    42 CFR 411.15    42 CFR 412.50    42 CFR 413.118    42 CFR 413.122    42 CFR 103.101    42 CFR 103.102   
Legal Authority: PL 105-33, sec 4521    PL 105-33, sec 4522    PL 105-33, sec 4523    PL 99-509, sec 9343(c)   
Legal Deadline:
Action Source Description Date
Final  Statutory    11/01/1998 
Timetable:
Action Date FR Cite
NPRM  09/08/1998  63 FR 47551   
Correction Notice  06/30/1999  64 FR 35258   
NPRM Comment Period End  07/30/1999    
Final Action  04/07/2000  65 FR 18434   
Regulatory Flexibility Analysis Required: Yes  Government Levels Affected: None 
Small Entities Affected: Businesses  Federalism: No 
Included in the Regulatory Plan: No 
Agency Contact:
Chuck Braver
Department of Health and Human Services
Centers for Medicare & Medicaid Services
Center for Health Plans and Providers, 7500 Security Boulevard,
Baltimore, MD 21244
Phone:410 786-6719