Medicare Geographic Classification Review Board (MGCRB) Procedures and Criteria and Supporting Regulations in 42 CFR, Section 412.256 & 412.230 (CMS-R-138)

Medicare Geographic Classification
Review Board Rules

The Medicare Geographic Classification Review Board’s
rules, which are effective July 21, 2016, are attached.
These rules apply to all approved geographic redesignations
and any new applications filed on or after July 21, 2016.
These rules supersede all previous Board instructions that
were issued on an annual basis. The Board may revise
these rules to reflect changes in the law, regulations, or the
Board’s policy and procedures.

Issued July 21, 2016

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Medicare Geographic Classification

Review Board Rules

Table of Contents
Overview..................................................................................................... 1

Rule 1 – Correspondence Requirements ...................................................... 2

1.1

MGCRB Contact Information ................................................................. 2

1.2

Delivery of Materials to the Board ......................................................... 2

1.3

Simultaneous Service to CMS ............................................................... 2

1.4

Case Identification on All Submissions ................................................... 2

1.5

Contact with the Board ........................................................................ 3

1.6

Ex Parte Communication ...................................................................... 3

Rule 2 – Provider Case Representative ....................................................... 3

2.1

Persons ............................................................................................. 3

2.2

Responsibilities ................................................................................... 4

2.3

Communication with Representative ...................................................... 4

2.4

Letter of Representation ...................................................................... 4

2.5

Withdrawal or Change of Representation................................................ 4

Rule 3 – Filing an Application – General ...................................................... 5

3.1

The Geographic Redesignation Application ............................................. 5

3.2

Deadline for a Timely Application .......................................................... 5

3.3

Complete Application ........................................................................... 5

3.4

Dismissal for Late Filing ....................................................................... 5

3.5

Alternative Requests ........................................................................... 5

3.6

Rounding Not Permitted ....................................................................... 6

Rule 4 – Filing an Individual Application ..................................................... 6

4.1

General Information for an Individual Application .................................... 6

4.2

Criteria for an Individual Application ...................................................... 6

4.3

Requirements for an Individual Application ............................................. 8

4.4

Limitations on Redesignation ................................................................ 8

Rule 5 – Filing a Group Application ............................................................. 9

5.1

General Information for a Group Application ........................................... 9

5.2

Criteria for a Group Application ............................................................. 9

5.3

Requirements for a Group Application .................................................. 10

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Rule 6 – Filing a Statewide Application ..................................................... 10

6.1

General Information for a Statewide Application ................................... 10

6.2

Criteria for a Statewide Application ..................................................... 10

6.3

Requirements for a Statewide Application ............................................ 11

Rule 7 –Acknowledgement of an Application ............................................ 11

7.1

Board’s Notice .................................................................................. 11

7.2

Parties’ Responsive Comments ........................................................... 11

7.3

Additional Documentation .................................................................. 12

Rule 8 – Board Hearings and Decisions ..................................................... 12

8.1

On the Record Hearing ...................................................................... 12

8.2

Oral Hearing..................................................................................... 12

8.3

Quorum ........................................................................................... 12

8.4

Recusals .......................................................................................... 12

8.5

Timing, Term, and Finality of MGCRB Decisions .................................... 12

Rule 9 – Administrator’s Review ............................................................... 13

9.1

Provider’s Request for Review............................................................. 13

9.2

Administrator Discretionary Review ..................................................... 13

9.3

Administrator Decision ....................................................................... 13

Rule 10 – Withdrawals and Terminations .................................................. 14

10.1

Withdrawals and Terminations – General........................................... 14

10.2

Withdrawal of an Application Prior to Board Decision .......................... 14

10.3

Withdrawal of an Approved Geographic Redesignation ........................ 14

10.4

Termination of an Approved Geographic Redesignation ....................... 14

10.5

Cancellations of Withdrawals and Terminations .................................. 15

10.6

Reapplications ............................................................................... 15

Appendix A – Geographic Terms and Concepts.......................................... 16

Statistical Areas ........................................................................................ 16

Urban and Rural Areas ............................................................................... 17

State Codes for Rural Areas........................................................................ 18

Appendix B – Summary of Application Forms ............................................ 19

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Overview
The Medicare Geographic Classification Review Board (“MGCRB” or “Board”) was
established by the Omnibus Budget Reconciliation Act of 1989 to review and make
determinations on geographic reclassification requests of hospitals who are
receiving payment under the inpatient prospective payment system (“IPPS”) but
wish to reclassify to a higher wage area for purposes of receiving a higher payment
rate. These rules govern proceedings before the MGCRB and contain instructions
for completing the application(s) that providers will need in applying for geographic
redesignation. These rules are consistent with 42 U.S.C. § 1395ww(d)(10) and 42
C.F.R. § 412.230ff.
The Board has discretion to take action if a provider fails to comply with these rules
or fails to comply with a Board order. While these rules cite regulatory crossreferences as a guide, the omission of a cross-reference does not excuse the
provider from meeting all controlling statutory and regulatory requirements.
Providers may obtain the average hourly wage data necessary to prepare
applications to the MGCRB from Federal Register documents. The IPPS proposed
rule is typically published by the end of April each year and the IPPS final rule is
published by mid-August. Both the proposed and final rules are on display
approximately 1 week prior to the official publication date. See
https://www.federalregister.gov/.
The Centers for Medicare & Medicaid Services (“CMS”) also posts copies of the
proposed and final rules along with all tables, additional data and analysis files, and
the impact file at http://www.cms.gov/Medicare/Medicare-Fee-for-ServicePayment/AcuteInpatientPPS/index.html. Applicants are encouraged to review the
federal register publications prior to filing an application as the Board will utilize the
relevant information in the IPPS final rule in making decisions on applications for
geographic redesignation.
The term “provider” and “hospital” are used interchangeably in MGCRB rules.
Notwithstanding references to the term “provider” or “hospital” in the singular, all
MGCRB rules apply to individual, group, and statewide applications unless the rule
indicates otherwise.

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Rule 1 – Correspondence Requirements
1.1

MGCRB Contact Information

All documents must be addressed as follows:
Medicare Geographic Classification Review Board
2520 Lord Baltimore Drive, Suite L
Baltimore, MD 21244-2670
Board Rules and application forms are available on the MGCRB website at
https://www.cms.gov/Regulations-and-Guidance/ReviewBoards/MGCRB/index.html.
1.2

Delivery of Materials to the Board

All submissions must be made in hard copy format to the Board’s mailing address.
Documents must be delivered to the Board in any one of the following ways:




by regular mail (the United States Postal Service (USPS));
by express or overnight mail by a nationally-recognized next-day courier
(such as USPS Express Mail, Federal Express, UPS, etc.); or
by hand or courier.

You must allow sufficient time for documents to be received in a timely manner.
The normal business hours for the mail room are 8:00 a.m. to 4:00 p.m.
(EDT/EST), Monday through Friday. Hand deliveries must be made to the mail
room only during normal business hours. The Board suggests that you call ahead
[(410) 786-1174] to inform a staff member of the delivery to ensure that someone
will be available to accept the delivery. The Board does not currently accept
applications or other correspondence submitted by e-mail, fax, or other electronic
means.
1.3

Simultaneous Service to CMS

A provider must simultaneously submit a copy of its geographic redesignation
application(s) and other correspondence to CMS’ Center for Medicare, Hospital &
Ambulatory Policy Group. Effective immediately, providers must e-mail a copy of
the applications and correspondence to CMS at wageindex@cms.hhs.gov. Delivery
to CMS does not constitute delivery to the MGCRB.
1.4

Case Identification on All Submissions

All filings and correspondence must contain the case number (except for the initial
application), along with the provider name and provider number and/or the group
name as applicable.

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1.5

Contact with the Board

Administrative or procedural inquiries should be directed to the Board staff at (410)
786-1174. Do not call or e-mail Board members directly.
1.6

Ex Parte Communication

The members of the MGCRB and its staff may not consult or be consulted by an
individual representing the interests of an applicant provider or by any other
individual on any matter at issue before the MGCRB without notice to the provider
or CMS. If such communication occurs, the MGCRB will disclose it to the provider
or CMS, as appropriate, and make it part of the record after the provider or CMS
has had an opportunity to comment. MGCRB members and staff must not consider
any information outside of the record about matters concerning a provider’s
application for reclassification.
The provisions in this section do not apply to:





communications among MGCRB members and its staff;
communications concerning the MGCRB's administrative functions or
procedures;
requests from the MGCRB to a party or CMS for a document;
material that the MGCRB includes in the record after notice and an
opportunity to comment.

Rule 2 – Provider Case Representative
2.1

Persons

A party may be represented by legal counsel or by any other person appointed to
act as its representative at any proceeding before the MGCRB or the Administrator.
All actions by the representative are considered to be those of the provider and
notice of any action or decision sent to the representative has the same effect as if
it had been sent to the provider itself.
The designated case representative is the individual with whom the Board maintains
contact. There may be only one case representative per application.
The case representative may be an external party (e.g., attorney or consultant) or
an internal party (e.g., employee or officer of the provider or its parent
organization). If no case representative is designated, the Board will consider the
officer who filed the application as the case representative. The Board will not
accept an application or other correspondence from any external organization that
is not designated as the official case representative.

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2.2

Responsibilities

The case representative is responsible for ensuring his or her contact information is
current with the Board and for timely responding to correspondence or requests
from the Board. Failure of a representative to carry out his or her responsibilities is
not considered by the Board to be good cause for failing to meet any deadlines.
2.3

Communication with Representative

The Board will address all correspondence to the provider’s official case
representative. If other members of the representative’s organization contact the
Board, the Board will assume the contact is authorized by the representative and
may communicate with these individuals about an application.
2.4

Letter of Representation

The letter designating the case representative must be on the provider’s letterhead
and be signed by an officer of the provider (e.g., Administrator, Vice President of
Finance) or by a corporate officer of the provider’s parent corporation. A letter of
representation is required whether designating an external or internal
representative.
The letter of representation must include the following information:





the provider name and provider number,
the reclassification period,
full contact information for the representative (name, title organization,
mailing address, e-mail address, and telephone number), and
full contact information of the authorizing official.

The letter of representation does not need to be notarized.
2.5

Withdrawal or Change of Representation

A designated representative may withdraw an appearance by filing a notice of
withdrawal signed by both the representative and the provider’s authorizing official.
Such notice should also include a concurrent submission of a new letter of
representation by the provider. If a provider’s written consent is not obtained, the
representative must file a withdrawal notice listing the provider’s last known
contact information and document that a copy of the withdrawal notice was sent to
the provider.
A provider may change its designated representative at any time by submitting a
new letter of representation. Withdrawal of a case representative or the recent
appointment of a new representative will not be considered cause for delay of any
deadlines or proceedings.

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Rule 3 – Filing an Application – General
3.1

The Geographic Redesignation Application

A provider may apply for geographic redesignation through (1) an individual
application; (2) a group application by all IPPS hospitals in a county, and/or (3) a
statewide wage index area application by all IPPS hospitals in a state. Federal
regulations at 42 C.F.R. §§ 412.230 through 412.280 provide guiding regulatory
criteria and conditions for such applications.
Providers requesting geographic redesignation must complete and submit an
original and two copies of the application and all available supporting
documentation to the Board by the regulatory deadline (see Board Rule 3.2).
3.2

Deadline for a Timely Application

A complete application must be received no later than the first day of the 13-month
period preceding the federal fiscal year for which geographic redesignation is
requested (September 1). The filing date of an application is the date the
application is received by the MGCRB. 42 C.F.R. § 412.256(a).
If the specified deadline is a Saturday, a Sunday, a Federal legal holiday (as
enumerated in Rule 6(a) of the Federal Rules of Civil Procedure), or a day on which
the MGCRB is unable to conduct business in the usual manner due to extraordinary
circumstances beyond its control (such as natural or other catastrophe, weather
conditions, fire, or furlough), the deadline becomes the next day that is not one of
the aforementioned days.
3.3

Complete Application

An application is complete if the application includes the following information:
(1) the federal fiscal year for which the provider or group of providers is applying
for redesignation; (2) which criteria constitute the basis of the request for
reclassification; (3) an explanation of how the application meets the relevant
criteria in 42 C.F.R. §§ 412.230 through 412.236, including any necessary data to
support the application; and, (4) a letter of representation per Board Rule 2.4.
3.4

Dismissal for Late Filing

The Board will dismiss a provider’s request for geographic redesignation if it does
not receive the provider’s application by the filing deadline.
3.5

Alternative Requests

A provider may simultaneously apply for geographic redesignation through an
individual application, a group application, and a statewide application. The Board
will rule on a statewide request first and then a group reclassification request
before it reviews any individual reclassification request. If the Board approves a

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statewide or group application, it will dismiss any individual reclassification
applications filed by participating providers.
Providers may also apply for redesignation to more than one geographic area within
their individual or group application. In such cases, the provider must submit a
separate request within the application for each of the geographic areas to which it
is requesting redesignation. The provider must also specify its preferred priority for
the Board’s consideration by clearly marking the respective requests as primary,
secondary, tertiary, etc.
3.6

Rounding Not Permitted

Rounding of numbers is not permitted to meet the mileage or qualifying wage
comparison percentage standards. 42 C.F.R. §§ 412.230(a)(4), 412.232(c), and
412.234(b).

Rule 4 – Filing an Individual Application
4.1

General Information for an Individual Application

A provider may seek geographic redesignation from a rural area to an urban area,
from a rural area to another rural area, or from an urban area to another urban
area for the purposes of using the other area's wage index value. An urban
provider may seek redesignation to a rural area through 42 C.F.R. § 412.103, not
through the MGCRB.
4.2

Criteria for an Individual Application

Federal regulations at 42 C.F.R. § 412.230 contain the criteria for individual
providers seeking redesignation.
(A) A provider must demonstrate a close proximity to the area to which it seeks
redesignation or qualify for special access by meeting one of the following
conditions:
(1) Proximity – Distance. The distance from the provider to the requested
area must be no more than 15 miles for an urban provider and no more than
35 miles for a rural provider. To demonstrate proximity, the provider must,
at a minimum, submit map evidence using a nationally recognized electronic
mapping service (e.g., Google Maps, Bing Maps, MapQuest). The map must
show the route over improved roads from the provider’s front entrance to the
county line of the requested area and the distance of that route.
An improved road is any road that is maintained by a local, state, or federal
government entity and available for use by the general public. An improved
road includes the paved surface up to the provider’s front entrance. For
further information, see 66 Fed. Reg. 39874-75 (Aug. 1, 2001) which

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discusses the definition of mileage for purposes of meeting the proximity
requirements.
(2) Proximity – Employee Commuting Pattern. At least 50 percent of the
provider's employees must reside in the requested area. For employee
address data, the provider must submit current payroll records that include
information that establishes the home addresses by zip code of its
employees.
(3) Special Access – Distance or Driving Time. A provider that is a rural
referral center, a sole community hospital, or both as of the date of the
MGCRB’s review need not demonstrate a close proximity to the area to which
it seeks redesignation per the criteria above. Instead, the provider may
request redesignation to the closest area. If the provider qualifies for urban
redesignation, it may be redesignated to the urban area that is closest to the
provider. If a rural provider is closer to another rural area than to any urban
area, it may seek redesignation to either the closest rural or the closest
urban area.
To demonstrate the closest area, the provider must, at a minimum, submit
map evidence using a nationally recognized electronic mapping service (e.g.,
Google Maps, Bing Maps, MapQuest). The map must show the shortest route
over improved roads from the provider’s front entrance to the requested area
and the distance or driving time of that route. The provider must also submit
the same evidence to the next closest area.
(B) A provider must demonstrate that a comparison of the provider's average
hourly wage (“AHW”) to other provider wage costs in its own area and the
requested area meet the thresholds as noted below.
(1) Provider located in a rural area. The provider's AHW must be at least:



106 percent of the AHW of all other hospitals in the area in which the
provider is located; and
82 percent of the AHW of hospitals in the area to which it seeks
redesignation;

(2) Provider located in an urban area. The provider's AHW must be at least:



108 percent of the AHW of all other hospitals in the area in which the
provider is located; and
84 percent of the AHW of hospitals in the area to which it seeks
redesignation.

(3) Exceptions. See 42 C.F.R. §§ 412.230(d)(3)-(5) for exceptions to the
wage comparisons for rural referral centers, special dominating hospitals,
and a single hospital in an MSA.

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(4) Appropriate wage data. The provider must submit a weighted 3-year
average of its hospital-specific data, plus a weighted 3-year average of the
AHW in both the area in which the provider is located and the area to which
the provider seeks reclassification. The wage data are taken from the CMS
hospital wage survey used to construct the wage index in effect for IPPS
payment purposes.
The Board will use the final official data in evaluating if a provider meets the
redesignation criteria. Providers may obtain this wage data information via
the CMS website at https://www.cms.gov/Medicare/Medicare-Fee-forService-Payment/AcuteInpatientPPS/Wage-Index-Files.html, and then
accessing the “Three Year MGCRB Reclassification Data” file for the federal
fiscal year for which the provider is applying. Any inquiries concerning the
CMS wage and hour data should be directed to wageindex@cms.hhs.gov.
4.3

Requirements for an Individual Application

The individual application consists of a series of questions and attachments required
to be filed, along with supplemental forms addressing the specific reclassification
method. The provider must identify the criteria that constitute the basis of the
request and supply all necessary supporting documentation to demonstrate that the
provider meets the relevant criteria. Failure to provide adequate support may
result in denial of the application.
4.4

Limitations on Redesignation

The following limitations apply to redesignation:
(A) An individual provider may not be redesignated to another area for purposes of
the wage index if the pre-reclassified average hourly wage for that area is lower
than the pre-reclassified average hourly wage for the area in which the hospital is
located.
(B) A provider may not be redesignated to more than one area, except for an
urban hospital that has been granted redesignation as rural under 42 C.F.R.
§ 412.103 and receives an additional reclassification by the MGCRB.
(C) If a provider is already reclassified to a given geographic area for wage index
purposes for a 3-year period, and submits an application for reclassification to the
same area for either the second or third year of the 3-year period, that application
will not be approved. The Board can, however, approve a hospital’s request to a
different geographic area than the area to which it is currently redesignated.

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Rule 5 – Filing a Group Application
5.1

General Information for a Group Application

All IPPS hospitals in a county may file a group application for geographic
redesignation with the Board. A provider that is the only IPPS hospital in its county
may also apply as a group. The Board can redesignate a hospital group only for the
purpose of using the requested area’s wage index and may reclassify a rural group
only to an urban area or an urban group to another urban area.
5.2

Criteria for a Group Application

Federal regulations at 42 C.F.R. § 412.232 contain the criteria for hospitals in a
rural county seeking redesignation. 42 C.F.R. § 412.234 sets forth the criteria for
all hospitals in an urban county seeking redesignation to another urban area. The
following conditions must be met:
(A) The county in which the hospitals are located must be adjacent to the MSA to
which they seek redesignation. In order to demonstrate that the group meets this
requirement, the group must include a map on which the group highlights the
county in which the hospital group is located and the requested area (e.g., see
Census Bureau maps at http://census.gov/geo/maps-data/maps/statecbsa.html).
(B) All hospitals in a county must jointly apply for redesignation as a group.
(C) For rural county groups only, the county in which the providers are located
must meet the criteria for metropolitan character. Specifically, the group must
demonstrate that the rural county in which they are located meets the standards
for redesignation to a Metropolitan Statistical Area (“MSA”) as an “outlying county.”
The providers may submit data, estimates, or projections, made by the Census
Bureau concerning population density or growth, or changes in designation of urban
areas. The MGCRB only considers the most recently issued data developed by the
Bureau of the Census.
(D) Urban hospitals located in counties that are in the same Combined Statistical
Area (“CSA”) or Core-Based Statistical Area (“CBSA”) as the urban area to which
they seek redesignation qualify as meeting the proximity requirements for
reclassification. To demonstrate, the group must attach the applicable page(s) of
the CSA or CBSA listing based on the most recent updates to statistical areas
announced by the Office of Management and Budget (“OMB”). See OMB Bulletin
15-01 (July 15, 2015), which may be accessed at:
https://www.whitehouse.gov/sites/default/files/omb/bulletins/2015/15-01.pdf..
(E) The aggregate average hourly wage for all hospitals in the group must be equal
to at least 85 percent of the average hourly wage in the adjacent urban area. The
hospitals must submit appropriate wage data computations demonstrating the
group meets this threshold. The computations must include wages and hours for
the three years used to calculate the wage index for each hospital in the group and
the 3-year average hourly wage for the requested area. The wage data are to be

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taken from the CMS hospital wage survey used to construct the wage index in
effect for prospective payment purposes.
The Board will use the final official data in evaluating if a group meets the
redesignation criteria. Providers may obtain this wage data information via the
CMS website at https://www.cms.gov/Medicare/Medicare-Fee-for-ServicePayment/AcuteInpatientPPS/Wage-Index-Files.html, under the “Three Year MGCRB
Reclassification Data” file for the federal fiscal year for which the group is applying.
Any inquiries concerning the CMS wage and hour data should be directed to
wageindex@cms.hhs.gov.
(F) The pre-reclassified average hourly wage for the area to which the providers
seek redesignation is higher than the pre-reclassified average hourly wage for the
area in which they are currently located.
5.3

Requirements for a Group Application

The group application consists of a series of questions and supporting
documentation, including a letter of representation from each provider in the group
and aggregate hourly wage computations. The Board will dismiss an application
that does not include all IPPS hospitals in the referenced county or that fails to
submit a fully executed letter of representation from each provider indicating its
participation in the group by the application due date.

Rule 6 – Filing a Statewide Application
6.1

General Information for a Statewide Application

An appropriate statewide entity can apply to have all of the geographic areas in the
state treated as a single geographic area for purposes of computing and applying
the area’s wage index for redesignations.
6.2

Criteria for a Statewide Application

Federal regulations at 42 C.F.R. § 412.235 contain criteria for hospitals in a state
seeking a wage index redesignation. The following conditions must be met:
(A) All IPPS hospitals in the state must apply as a group for reclassification to a
statewide wage index through a signed single application.
(B) All IPPS hospitals in the state must agree to the reclassification to a statewide
wage index through a signed affidavit on the application.
(C) All IPPS hospitals in the state must agree, through an affidavit, to withdrawal
of an application or to termination of an approved statewide wage index
reclassification.

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(D) All IPPS hospitals in the state must waive their rights to any wage index
classification that they would otherwise receive absent the statewide wage index
classification, including a wage index that any of the hospitals might have received
through individual geographic reclassification.
(E) New hospitals that open within the state prior to the deadline for submitting an
application for a statewide wage index reclassification, regardless of whether a
group application has already been filed, must agree to the use of the statewide
wage index as part of the group application. New hospitals that open within the
state after the deadline for submitting a statewide wage index reclassification
application or during the approved reclassification period will be considered a party
to the statewide wage index application and reclassification.
6.3

Requirements for a Statewide Application

The statewide wage index application consists of a series of questions and
supporting documentation, including an affidavit and letter of representation from
each hospital in the statewide group. Each affidavit must be fully executed and
notarized and submitted in original form (copies are not permitted). The Board will
dismiss a statewide application that does not include all IPPS hospitals in the
referenced state or that fails to include a proper affidavit and letter of
representation from each provider by the application due date.

Rule 7 –Acknowledgement of an Application
7.1

Board’s Notice

The Board will send an acknowledgement notice indicating that the application for
geographic redesignation has been received, identifying the case number assigned,
and stating whether the application is either complete or incomplete. If the
application contains all the necessary elements, the Board notifies the case
representative in writing (with a copy to CMS) that the application is complete and
that the case may proceed.
If the Board determines that an application is incomplete, the notice will identify the
additional documentation required and the deadline for submission. Upon
completion of the application, the Board will issue a supplemental notice to the
parties. Failure to timely submit the requested information will result in the
dismissal of the application.
7.2

Parties’ Responsive Comments

CMS has 30 days from the date of receipt of notice of a complete application to
submit written comments and recommendations (with a copy to the provider) for
consideration by the MGCRB. The provider has 15 days from the date of receipt of
CMS' comments to submit written comments to the MGCRB (with a copy to CMS)
for the purpose of responding to CMS' comments. 42 C.F.R. § 412.258.

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7.3

Additional Documentation

Upon substantive review of a filed application that was previously identified as
technically complete in accordance with 42 C.F.R. § 412.256(b), the Board may
determine that further information is needed to process the application. In such
cases, the Board will issue a supplemental request for additional supporting
documentation. Failure to timely submit the requested information may result in
the denial of the geographic redesignation application.

Rule 8 – Board Hearings and Decisions
8.1

On the Record Hearing

The MGCRB will ordinarily issue an on-the-record decision without conducting an
oral hearing. The decision will be based upon all documents, data, and other
written evidence and comments submitted timely to the MGCRB by the parties. 42
C.F.R. § 412.254(a).
8.2

Oral Hearing

The MGCRB may hold an oral hearing on its own motion or if a party demonstrates
to the MGCRB's satisfaction that an oral hearing is necessary. 42 C.F.R.
§ 412.254(b). The provider must advise the Board in writing if it is requesting an
oral hearing and attach the rationale for the oral hearing to its application.
8.3

Quorum

A quorum consisting of at least a majority of the members of the MGCRB, one of
whom is representative of rural hospitals, is required for making MGCRB decisions.
42 C.F.R. § 412.248.
8.4

Recusals

An MGCRB member may not participate in any decision in which he or she may be
prejudiced or partial with respect to a party or has any other interest in the case.
In such a case, the MGCRB member will withdraw (recuse) themselves from that
decision. 42 C.F.R. § 412.262.
8.5

Timing, Term, and Finality of MGCRB Decisions

The Board will issue all decisions within 180 days after the deadline for filing
geographic redesignation applications. 42 C.F.R. § 412.276.
A decision by the MGCRB on a geographic redesignation application will be effective
for 3 years beginning with discharges occurring on the first day (October 1) of the
second federal fiscal year following the federal fiscal year in which the providers
filed a complete application. 42 C.F.R. § 412.274.

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A decision of the MGCRB is final and binding upon the parties unless it is reviewed
by the Administrator and the decision is changed by the Administrator in
accordance with 42 C.F.R. § 412.278.
Providers may withdraw or terminate an approved 3-year reclassification in
accordance with 42 C.F.R. § 412.273. See Board Rule 10.

Rule 9 – Administrator’s Review
9.1

Provider’s Request for Review

In accordance with 42 C.F.R. § 412.278, a hospital or group of hospitals dissatisfied
with an MGCRB’s geographic redesignation decision may request that the CMS
Administrator review the MGCRB decision. Providers may also request that the
Administrator review the MGCRB’s dismissal of an application as untimely filed or
incomplete.
Providers must submit such requests in writing to the CMS Administrator, in care of
the Office of the Attorney Advisor, at the following address.
Centers for Medicare & Medicaid Services
Office of the Attorney Advisor
Room C3-01-20
7500 Security Boulevard
Baltimore, MD 21244-1850
The request must be received by the Administrator within 15 days after the date
the MGCRB issues its decision. A request for Administrator review filed by facsimile
or other electronic means will not be accepted.
Providers must also e-mail a copy of its request to CMS’ Center for Medicare,
Hospital & Ambulatory Policy Group at wageindex@cms.hhs.gov.
9.2

Administrator Discretionary Review

The CMS Administrator may, at his or her own discretion, review any final decision
of the MGCRB. The provider will be notified if the Administrator decides to review a
MGCRB decision and the provider may submit a response to the Administrator
within 15 days of receipt of the Administrator’s notice of review. 42 C.F.R.
§ 412.278(c).
9.3

Administrator Decision

The Administrator may not receive or consider any new evidence and must issue a
decision based only upon the record as it appeared before the MGCRB and any
comments submitted under 42 C.F.R. § 412.278(b)-(c). The Administrator will
issue a decision to the provider no later than 90 days following receipt of the

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provider’s request for review or no later than 105 days following the issuance of the
MGCRB decision in the case of discretionary review. The Administrator’s decision is
the final Departmental decision and is not subject to judicial review.

Rule 10 – Withdrawals and Terminations
10.1 Withdrawals and Terminations – General
Providers are encouraged to review the provisions contained in 42 C.F.R. § 412.273
regarding withdrawals and terminations. Additional information can also be found
in the IPPS final rules for federal fiscal years 2002, 2003, 2008, 2009 and 2011
(see 66 Fed. Reg. 39887-39777 (Aug. 1, 2001), 67 Fed. Reg. 50065-50066 (Aug.
1, 2002), 72 Fed. Reg. 47332-47334 (Aug. 22, 2007), 73 Fed. Reg. 48586 (Aug. 9,
2008) and 75 Fed. Reg. 50172-50173 (August 16, 2010).
10.2 Withdrawal of an Application Prior to Board Decision
Providers may withdraw their request for geographic redesignation at any time
before the Board issues a decision on the application. 42 C.F.R. § 412.273(c)(1)(i).
10.3 Withdrawal of an Approved Geographic Redesignation
Withdrawal refers to the withdrawal of a 3-year MGCRB reclassification that has
been approved by the Board but has not yet gone into effect. Withdrawal requests
approved by the Board will be effective for the full 3-year reclassification period.
Hospital groups and statewide wage index groups may also withdraw an approved
geographic redesignation, but the request to withdraw must be made by all
hospitals that are a party to the approved redesignation.
A request to withdraw an approved geographic redesignation must be received by
the Board within 45 days from the date of publication of CMS’ annual notice of
proposed rulemaking concerning the changes to the hospital IPPS and proposed
payment rates for the fiscal year for which the application has been filed.
10.4 Termination of an Approved Geographic Redesignation
Termination refers to the termination of an already existing 3-year MGCRB
reclassification where such reclassification has already been in effect for 1 or 2
years, and there are 1 or 2 years remaining on the 3-year reclassification. A
termination is effective only for the full fiscal year(s) remaining in the 3-year period
at the time the request is received. Requests for terminations for part of a fiscal
year are not considered.
Hospital groups and statewide wage index groups may terminate an approved
geographic redesignation in its entirety or any individual provider within the group

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may individually request to terminate participation in the second and/or third
year(s) of a 3-year geographic redesignation.
A request to terminate an approved geographic redesignation must be received by
the Board within 45 days from the date of publication of CMS’ annual notice of
proposed rulemaking concerning the changes to the hospital IPPS and proposed
payment rates for the fiscal year for which the application has been filed.
10.5 Cancellations of Withdrawals and Terminations
A hospital or group of hospitals may cancel a withdrawal or termination in a
subsequent year and request that the MGCRB reinstate the wage index
reclassification for the remaining fiscal year(s) of the 3-year period. Withdrawals
may be cancelled only in cases where the MGCRB issued a decision on the
geographic reclassification request.
Cancellation requests must be received in writing by the MGCRB no later than the
deadline for submitting reclassification applications for the following fiscal year, as
specified in 42 C.F.R. § 412.256(a)(2).
10.6 Reapplications
A provider may apply for reclassification to a different area (that is, an area
different from the one to which it was originally reclassified for the 3-year period).
If the application is approved, the reclassification will be effective for 3 years. The
provider’s existing 3-year reclassification will be terminated when a second 3-year
wage index reclassification goes into effect for payments for discharges on or after
the following October 1. Once the new reclassification becomes effective, a
provider may no longer cancel a withdrawal or termination of a prior 3-year
reclassification.

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Appendix A – Geographic Terms and Concepts
Statistical Areas
Core Based Statistical Areas (“CBSAs”) consist of the county or counties or
equivalent entities associated with at least one core area with a population of at
least 10,000 (urbanized area or urban cluster), plus adjacent counties having a
high degree of social and economic integration with the core area as measured
through commuting ties with the counties associated with the core area. The term
"core based statistical area" became effective in 2003 and refers collectively to
metropolitan statistical areas and micropolitan statistical areas. The U.S. Office of
Management and Budget (“OMB”) defines CBSAs to provide a nationally consistent
set of geographic entities for the United States and Puerto Rico for use in tabulating
and presenting statistical data and updates the CBSAs based on U.S. Census
Bureau data.
Combined Statistical Areas (“CSAs”) consist of two or more adjacent CBSAs
that have substantial employment interchange. The CBSAs that combine to create
a CSA retain separate identities within the larger CSA.
Metropolitan Divisions are smaller groupings of counties or equivalent entities
defined within a metropolitan statistical area containing a single core area with a
population of at least 2.5 million. Not all metropolitan statistical areas with
urbanized areas of this size will contain metropolitan divisions. A metropolitan
division consists of one or more main/secondary counties that represent an
employment center or centers, plus adjacent counties associated with the
main/secondary county or counties through commuting ties.
Metropolitan Statistical Areas (“MSAs”) are CBSAs associated with at least one
urbanized area that has a population of at least 50,000. The metropolitan
statistical area comprises the central county or counties or equivalent entities
containing the core area, plus adjacent outlying counties having a high degree of
social and economic integration with the central county or counties as measured
through commuting.
Micropolitan Statistical Areas are CBSAs associated with at least one urban
cluster that has a population of at least 10,000 but less than 50,000. The
micropolitan statistical area comprises the central county or counties or equivalent
entities containing the core area, plus adjacent outlying counties having a high
degree of social and economic integration with the central county or counties as
measured through commuting.
New England City and Town Areas (“NECTAs”) are an alternative set of
geographic entities, similar in concept to the county-based CBSAs defined
nationwide, that OMB defines in New England based on county subdivisions—
usually cities and towns. NECTAs are defined using the same criteria as countybased CBSAs, and, similar to CBSAs, NECTAs are categorized as metropolitan or
micropolitan.

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New England City and Town Area Divisions are smaller groupings of cities and
towns defined within a NECTA containing a single core area with a population of at
least 2.5 million. A NECTA division consists of a main city or town that represents
an employment center, plus adjacent cities and towns associated with the main city
or town through commuting ties. Each NECTA division must contain a total
population of 100,000 or more.
Urban and Rural Areas
Hospitals in MSAs and Metropolitan Divisions are classified as “urban hospitals” for
application purposes. These areas are identified using a five-digit numeric code
that is assigned alphabetically based on title and is unique within the nation. All
applications must use the urban identification codes and names as identified in OMB
Bulletin No. 15-01 (July 15, 2015). This bulletin may be accessed at:
https://www.whitehouse.gov/sites/default/files/omb/bulletins/2015/15-01.pdf
All other areas (including Micropolitan Statistical Areas) are classified as “rural
hospitals” for application purposes. The rural areas are identified using a two-digit
numeric code that is unique to each state. The state codes are included within this
appendix.
42 U.S.C. § 1395ww(d)(8), through paragraphs (B) and (E), sets forth provisions
for certain hospitals located in rural counties to be redesignated as urban
(commonly referred to as “Lugar hospitals”) or for hospitals located in urban areas
to apply to be treated as being located in a rural area (commonly referred to as
“Section 401 hospitals”). See also 42 C.F.R. §§ 412.64(b)(3) and 412.103. These
provisions are separate and distinct from the MGCRB application process.

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State Codes for Rural Areas
State Code

StateName

State Code

StateName

01
02
03

Alabama
Alaska
Arizona

27
28
29

Montana
Nebraska
Nevada

04
05
06
07
08
10

Arkansas
California
Colorado
Connecticut
Delaware
Florida

30
31
32
33
34
35

New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota

11
12
13
14
15
16

Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa

36
37
38
39
41
42

Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina

17
18
19
20
21
22

Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts

43
44
45
46
47
49

South Dakota
Tennessee
Texas
Utah
Vermont
Virginia

23
24
25
26

Michigan
Minnesota
Mississippi
Missouri

50
51
52
53

Washington
West Virginia
Wisconsin
Wyoming

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Appendix B – Summary of Application Forms
The following application and supporting forms are available on the MGCRB website
at https://www.cms.gov/Regulations-and-Guidance/ReviewBoards/MGCRB/index.html:
(1) Individual Application
Individual Reclassification Request Forms (by method):

 Proximity – Distance

 Proximity – Employee Commuting Pattern

 Special Access – Distance

 Special Access – Driving Time

(2) Group Application
(3) Statewide Application

Statewide Affidavit

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