Children's Hospitals Graduate Medical Education Payment Program
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Hospital Complex (Rotation Sites) | Indirect Medical Education (Formula) | Initial Residency Period

Hospital Complex
The CHGME Payment Program does not differentiate between prospective payment system (PPS) and non-PPS locations within a hospital complex.  Therefore, the time a resident spends anywhere within the hospital complex may be included in the resident FTE count for CHGME Payment Program purposes.
Additional references:
Social Security Act, Section 1886
42 CFR 413.86 (Centers for Medicaid and Medicare Services, formerly the Health Care Financing Administration)
CHGME Payment Program, Federal Register Notice dated March 1, 2001 (66 FR 12940)
Applicable to the following application forms: 
HRSA-99-1, HRSA-99-2, and HRSA-99-4

Indirect Medical Education (IME) Formula
IME payments to individual hospitals are based upon a hospital’s rolling average of the unweighted resident FTE count for DME payments.
The rolling average is the average of the resident FTE counts reported by the hospital for the:
• most recently filed Medicare cost report (MCR) [or the most recently completed Medicare cost reporting period];
• the previously filed MCR (or the previously completed Medicare cost reporting period); and
•the penultimate filed MCR (or the penultimate completed Medicare cost reporting period).
The number of FTE residents for payment purposes is equal to the average of the actual unweighted FTE resident count (applying the cap to this number if it is the lesser of the two numbers) for that cost reporting period and the preceding two cost reporting periods.
IME CHGME Payment Program funding is calculated by the formula:
IME Pay_i = Z_IME *NoDi*CMIi*(WIi*.711+.289)*1.6((1+residentsi-to-bedi ratio) .405-1)
n
' NoDi*CMIi*(WIi*.711+.289)*1.6((1+residentsi-to bedi ratio) .405-1)
 i=1
NoD = total number of inpatient discharges
CMI = case mix index
WI = area wage index for hospital
Z_IME = total dollars available for CHGME program IME payments
IME Pay_i = IME payment to an individual hospital
i = individual hospital
m = total number of hospitals with ALOS > or = 30 days participating in the CHGME program
n = total number of  hospitals with ALOS < 30 days participating in the CHGME program
residents = average number of unweighted FTE residents in the most recently completed cost reporting period with application of the cap.
beds = sum of all available beds, including beds and bassinets in the healthy newborn nursery, in the most recently completed cost report filing period, divided by the number of days in that period.

Initial Residency Period (IRP)
Residents are divided into two categories, those in their:
1. initial residency period (IRP);
a. An initial residency period is defined as the minimum number of years required to reach  board eligibility up to a maximum of 5 years.
i. For allopathic residency programs, the IRP is the minimum number of years of formal training required for initial board eligibility in a specialty as specified in the current Directory of Residency Training Programs.
ii. For osteopathic, dentistry, and podiatric programs, the IRP is the minimum number of years of formal training necessary to satisfy the requirements of the approving body for those programs.
2. and those beyond their initial residency period.
Example:
The IRP for pediatrics is 3 years.  Therefore, the initial residency period for all pediatric subspecialties (e.g., pediatric cardiology) is three years.
The IRP for general surgery is 5 years.  Therefore, the initial residency period of all surgical subspecialties (e.g., pediatric surgery) is 5 years even if the training program requires a longer period of training.
Exceptions apply to the IRP for residents enrolled in preventive medicine, geriatric medicine, transitional year and combined residency programs.  Refer to 42 CFR 413.86 for additional information on the IRP and exceptions.
Additional references:
Social Security Act, Section 1886
42 CFR 413.86 (Centers for Medicaid and Medicare Services, formerly the Health Care Financing Administration)
Applicable to the following application forms:
HRSA-99-1