2006 proposed fee schedule - American Society of Clinical Oncology

139
billed drugs regardless of setting, and provide a reasonable
estimation of the drug add-on amount needed to adjust the
composite rates for drugs other than EPO furnished in
hospital-based facilities. We seek comment about this
potential method to estimate spread for drugs furnished in
hospital-based facilities, as well as alternative estimation
methodologies, data, or both.
3. Proposed Revisions to Geographic Designations and Wage
Indexes Applied to the ESRD Composite Payment Rate
[If you choose to comment on issues in this section, please
include the caption “ESRD—Composite Payment Rate Wage Index”
at the beginning of your comments.]
Because of the significance of labor costs in
determining the total cost of care, the prospective payment
systems (PPSs) which we administer traditionally have used a
wage index to account for differences in area wage levels.
The labor-related shares of costs used to develop the
composite rates were 36.78 percent for hospital-based
facilities and 40.65 percent for independent facilities.
The current composite payment rates are calculated using a
blend of two wage indexes, one based on hospital wage data
for fiscal years ending in CY 1982, and the other developed
from CY 1980 data from the Bureau of Labor Statistics (BLS).
The wage indexes are calculated for each urban and rural
area based on 1980 U.S. Census definitions of metropolitan