applicable percent
(7) Funding for value-based incentive payments (A) Amount The total amount available for value-based incentive payments under paragraph (6) for all hospitals for a fiscal year shall be equal to the total amount of reduced payments for all hospitals under subparagraph (B) for such fiscal year, as estimated by the Secretary. (B) Adjustment to payments (i) In general The Secretary shall reduce the base operating DRG payment amount (as defined in subparagraph (D)) for a hospital for each discharge in a fiscal year (beginning with fiscal year 2013) by an amount equal to the applicable percent (as defined in subparagraph (C)) of the base operating DRG payment amount for the discharge for the hospital for such fiscal year. The Secretary shall make such reductions for all hospitals in the fiscal year involved, regardless of whether or not the hospital has been determined by the Secretary to have earned a value-based incentive payment under paragraph (6) for such fiscal year. (ii) No effect on other payments Payments described in items (aa) and (bb) of subparagraph (D)(i)(II) for a hospital shall be determined as if this subsection had not been enacted. (C) Applicable percent defined For purposes of subparagraph (B), the term “applicable percent” means— (i) with respect to fiscal year 2013, 1.0 percent; (ii) with respect to fiscal year 2014, 1.25 percent; (iii) with respect to fiscal year 2015, 1.5 percent; (iv) with respect to fiscal year 2016, 1.75 percent; and (v) with respect to fiscal year 2017 and succeeding fiscal years, 2 percent. (D) Base operating DRG payment amount defined (i) In general Except as provided in clause (ii), in this subsection, the term “base operating DRG payment amount” means, with respect to a hospital for a fiscal year— (I) the payment amount that would otherwise be made under subsection (d) (determined without regard to subsection (q)) for a discharge if this subsection did not apply; reduced by (II) any portion of such payment amount that is attributable to— (aa) payments under paragraphs (5)(A), (5)(B), (5)(F), and (12) of subsection (d); and (bb) such other payments under subsection (d) determined appropriate by the Secretary. (ii) Special rules for certain hospitals (I) Sole community hospitals and medicare-dependent, small rural hospitals In the case of a medicare-dependent, small rural hospital (with respect to discharges occurring during fiscal year 2012 and 2013) or a sole community hospital, in applying subparagraph (A)(i), the payment amount that would otherwise be made under subsection (d) shall be determined without regard to subparagraphs (I) and (L) of subsection (b)(3) and subparagraphs (D) and (G) of subsection (d)(5). (II) Hospitals paid under section 1395f In the case of a hospital that is paid under section 1395f(b)(3) of this title , the term “base operating DRG payment amount” means the payment amount under such section.