The Centers for Medicare and Medicaid Services issued Change Requests 1369 and 2692 , which implement Section 541 of the Balanced Budget Refinement Act (BBRA) of 1999 and Section 512 of the Benefits Improvement and Protection Act (BIPA) of 2000. These two regulations address managed care nursing and allied health payments effective for portions of cost reporting periods occurring on or after January 1, 2000.

Section 541 of the BBRA and Section 512 of the BIPA provide for additional payments to hospitals for costs of nursing and allied health education associated with services to managed care enrollees. Hospitals that operate approved nursing or allied health education programs and receive Medicare reasonable cost reimbursement for these programs would receive additional payments. The additional payment is reported on Worksheet E Part A of the Medicare cost report (Worksheet E-3 Part I for freestanding non-inpatient prospective payment system [IPPS] facilities). The regulations also provide that direct graduate medical education (GME) payments for managed care utilization will be reduced to the extent that these additional payments are made for nursing and allied health education programs. This reduction is performed on Worksheet E-3 Part IV of the Medicare cost report.

National Government Services has developed an Excel-based calculation tool designed to help providers determine their nursing and allied health managed care payment.

Please contact the Medicare Audit and Reimbursement office servicing your facility with questions.