reference resident level
(8) Distribution of additional residency positions (A) Reductions in limit based on unused positions (i) In general Except as provided in clause (ii), if a hospital’s reference resident level (as defined in subparagraph (H)(i)) is less than the otherwise applicable resident limit (as defined in subparagraph (H)(iii)), effective for portions of cost reporting periods occurring on or after July 1, 2011 , the otherwise applicable resident limit shall be reduced by 65 percent of the difference between such otherwise applicable resident limit and such reference resident level. (ii) Exceptions This subparagraph shall not apply to— (I) a hospital located in a rural area (as defined in subsection (d)(2)(D)(ii)) with fewer than 250 acute care inpatient beds; (II) a hospital that was part of a qualifying entity which had a voluntary residency reduction plan approved under paragraph (6)(B) or under the authority of section 402 of Public Law 90–248 , if the hospital demonstrates to the Secretary that it has a specified plan in place for filling the unused positions by not later than 2 years after March 23, 2010 ; or (III) a hospital described in paragraph (4)(H)(v). (B) Distribution (i) In general The Secretary shall increase the otherwise applicable resident limit for each qualifying hospital that submits an application under this subparagraph by such number as the Secretary may approve for portions of cost reporting periods occurring on or after July 1, 2011 . The aggregate number of increases in the otherwise applicable resident limit under this subparagraph shall be equal to the aggregate reduction in such limits attributable to subparagraph (A) (as estimated by the Secretary). (ii) Requirements Subject to clause (iii), a hospital that receives an increase in the otherwise applicable resident limit under this subparagraph shall ensure, during the 5-year period beginning on the date of such increase, that— (I) the number of full-time equivalent primary care residents, as defined in paragraph (5)(H) (as determined by the Secretary), excluding any additional positions under subclause (II), is not less than the average number of full-time equivalent primary care residents (as so determined) during the 3 most recent cost reporting periods ending prior to March 23, 2010 ; and (II) not less than 75 percent of the positions attributable to such increase are in a primary care or general surgery residency (as determined by the Secretary). The Secretary may determine whether a hospital has met the requirements under this clause during such 5-year period in such manner and at such time as the Secretary determines appropriate, including at the end of such 5-year period. (iii) Redistribution of positions if hospital no longer meets certain requirements In the case where the Secretary determines that a hospital described in clause (ii) does not meet either of the requirements under subclause (I) or (II) of such clause, the Secretary shall— (I) reduce the otherwise applicable resident limit of the hospital by the amount by which such limit was increased under this paragraph; and (II) provide for the distribution of positions attributable to such reduction in accordance with the requirements of this paragraph. (C) Considerations in redistribution In determining for which hospitals the increase in the otherwise applicable resident limit is provided under subparagraph (B), the Secretary shall take into account— (i) the demonstration likelihood of the hospital filling the positions made available under this paragraph within the first 3 cost reporting periods beginning on or after July 1, 2011 , as determined by the Secretary; and (ii) whether the hospital has an accredited rural training track (as described in paragraph (4)(H)(iv)). (D) Priority for certain areas In determining for which hospitals the increase in the otherwise applicable resident limit is provided under subparagraph (B), subject to subparagraph (E), the Secretary shall distribute the increase to hospitals based on the following factors: (i) Whether the hospital is located in a State with a resident-to-population ratio in the lowest quartile (as determined by the Secretary). (ii) Whether the hospital is located in a State, a territory of the United States, or the District of Columbia that is among the top 10 States, territories, or Districts in terms of the ratio of— (I) the total population of the State, territory, or District living in an area designated (under such section 332(a)(1)(A) 5 ) as a health professional shortage area (as of March 23, 2010 ); to (II) the total population of the State, territory, or District (as determined by the Secretary based on the most recent available population data published by the Bureau of the Census). (iii) Whether the hospital is located in a rural area (as defined in subsection (d)(2)(D)(ii)). (E) Reservation of positions for certain hospitals (i) In general Subject to clause (ii), the Secretary shall reserve the positions available for distribution under this paragraph as follows: (I) 70 percent of such positions for distribution to hospitals described in clause (i) of subparagraph (D). (II) 30 percent of such positions for distribution to hospitals described in clause (ii) and (iii) of such subparagraph. (ii) Exception if positions not redistributed by July 1, 2011 In the case where the Secretary does not distribute positions to hospitals in accordance with clause (i) by July 1, 2011 , the Secretary shall distribute such positions to other hospitals in accordance with the considerations described in subparagraph (C) and the priority described in subparagraph (D). (F) Limitation A hospital may not receive more than 75 full-time equivalent additional residency positions under this paragraph. (G) Application of per resident amounts for primary care and nonprimary care With respect to additional residency positions in a hospital attributable to the increase provided under this paragraph, the approved FTE per resident amounts are deemed to be equal to the hospital per resident amounts for primary care and nonprimary care computed under paragraph (2)(D) for that hospital. (H) Definitions In this paragraph: (i) Reference resident level The term “reference resident level” means, with respect to a hospital, the highest resident level for any of the 3 most recent cost reporting periods (ending before March 23, 2010 ) of the hospital for which a cost report has been settled (or, if not, submitted (subject to audit)), as determined by the Secretary. (ii) Resident level The term “resident level” has the meaning given such term in paragraph (7)(C)(i). (iii) Otherwise applicable resident limit The term “otherwise applicable resident limit” means, with respect to a hospital, the limit otherwise applicable under subparagraphs (F)(i) and (H) of paragraph (4) on the resident level for the hospital determined without regard to this paragraph but taking into account paragraph (7)(A). (I) Affiliation The provisions of this paragraph shall be applied to hospitals which are members of the same affiliated group (as defined by the Secretary under paragraph (4)(H)(ii)) and the reference resident level for each such hospital shall be the reference resident level with respect to the cost reporting period that results in the smallest difference between the reference resident level and the otherwise applicable resident limit.