WSR 04-08-123



(Medical Assistance Administration)

[ Filed April 7, 2004, 9:08 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 04-05-085A.

Title of Rule: Amending WAC 388-550-3100 Calculating DRG relative weights.

Purpose: To allow the department to use a broader database for calculating relative weights for the diagnostic-related group (DRG) formula.

Statutory Authority for Adoption: RCW 74.08.090, 74.04.050.

Statute Being Implemented: RCW 74.08.090, 74.04.050.

Summary: The proposed rule allows the department to calculate DRGs using a more realistic set of relative weights.

Name of Agency Personnel Responsible for Drafting: Kathy Sayre, P.O. Box 45533, Olympia, WA 98504, (360) 725-1342; Implementation and Enforcement: John Hanson, P.O. Box 45510, Olympia, WA 98504, (360) 725-1856.

Name of Proponent: Department of Social and Health Services, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: See Purpose and Summary above. The anticipated effect will be DRGs that reflect a more realistic set of relative weights.

Proposal Changes the Following Existing Rules: Adds language that allows the department to use non-Medicaid specific data from other inpatient populations to establish additional separate set(s) of non-Medicaid relative weights for calculating relative weights for the DRG formula.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The department has analyzed the rules and concluded that no new costs will be imposed on small businesses.

RCW 34.05.328 does not apply to this rule adoption. The proposed rule is not a "significant legislative rule" as defined in RCW 34.05.328. The department is not making significant amendments to policy. The proposed rule amendment merely allows the department to use a broader database for calculating relative weights.

Hearing Location: Blake Office Park (behind Goodyear Courtesy Tire), 4500 10th Avenue S.E., Rose Room, Lacey, WA 98503, on May 11, 2004, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Andy Fernando, DSHS Rules Coordinator, by May 7, 2004, phone (360) 664-6097, TTY (360) 664-6178, e-mail

Submit Written Comments to: Identify WAC Numbers, DSHS Rules Coordinator, Rules and Policies Assistance Unit, mail to P.O. Box 45850, Olympia, WA 98504-5850, deliver to 4500 10th Avenue S.E., Lacey, WA, fax (360) 664-6185, e-mail, by 5:00 p.m., May 11, 2004.

Date of Intended Adoption: Not sooner than May 12, 2004.

April 2, 2004

Brian H. Lindgren, Manager

Rules and Policies Assistance Unit

AMENDATORY SECTION(Amending WSR 99-06-046, filed 2/26/99, effective 3/29/99)

WAC 388-550-3100   Calculating DRG relative weights.   (1) ((MAA sets Washington Medicaid-specific DRG relative weights, as follows)) This section describes how the medical assistance administration (MAA) calculates Washington diagnostic-related group (DRG) relative weights, MAA:

(a) ((Uses)) Classifies the Washington hospital admissions data using the all-patient grouper (AP-DRG) ((to classify Washington Medicaid hospital admissions data)).

(b) Statistically tests each DRG for adequacy of sample size to ensure that relative weights meet acceptable reliability and validity standards.

(c) Establishes a single set of Medicaid-specific relative weights from Washington ((Medicaid)) hospital admissions data. These relative weights may be stable or unstable.

(d) Tests the stability of ((Washington Medicaid)) the relative weights from subsection (1)(c) of this section using a reasonable statistical test to determine if the weights are stable. MAA accepts as stable and adopts those ((Washington Medicaid)) relative weights that pass the reasonable statistical test.

(e) ((Pays admissions for DRGs having unstable Washington Medicaid relative weights using the RCC method)) May compare the Medicaid-specific relative weights to non-Medicaid relative weights. MAA:

(i) May combine the Medicaid-specific relative weights with the non-Medicaid relative weights if the non-Medicaid relative weights are statistically comparable to the Medicaid-specific weights; or

(ii) Uses only the Medicaid-specific relative weights if the non-Medicaid relative weights are not statistically comparable to the Medicaid-specific relative weights.

(f) Uses the ratio of costs-to-charges (RCC) method to pay for hospital stays that have unstable DRG relative weights.

(2) When using ratios with a ((Washington Medicaid)) DRG relative weight as base, MAA adjusts all stable ((Medicaid)) relative weights so that the average weight of the case mix population equals 1.0.

[Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, 388-550-3100, filed 2/26/99, effective 3/29/99. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, 388-550-3100, filed 12/18/97, effective 1/18/98.]

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