Medicare program; prospective payment system for long-term care hospitals RY 2007: annual payment rate updates, policy changes, and clarification. Final rule.

This final rule updates the annual payment rates for the Medicare prospective payment system (PPS) for inpatient hospital services provided by long-term care hospitals (LTCHs). The payment amounts and factors used to determine the updated Federal rates that are described in this final rule have been determined for the LTCH PPS rate year July 1, 2006 through June 30, 2007. The annual update of the long-term care diagnosis-related group (LTC-DRG) classifications and relative weights remains linked to the annual adjustments of the acute care hospital inpatient diagnosis-related group system, and will continue to be effective each October 1. The outlier threshold for July 1, 2006, through June 30, 2007, is also derived from the LTCH PPS rate year calculations. We are also finalizing policy changes and making clarifications.