Under the Centers for Medicare & Medicaid Services ("CMS") "Reporting Hospital Quality Data for Annual Payment Update," or RHQDAPU program, hospitals must meet certain accuracy thresholds with respect to the data they report in order to receive their full market basket update. The RHQDAPU program was initiated under the Medicare Prescription Drug, Improvement and Modernization Act of 2003 and in subsequent legislation has been expanded to require the reporting of additional quality measures as well as the amount of the annual payment update tied to properly reporting the measures. (Presently, it is only the accuracy of the data that is reported that is critical to receiving the payment update, although under CMS value-based purchasing proposals, the level of quality measures met would be used to determine elements of the hospitals' payments.) In October, CMS announced that it had rejected the full payment update for 201 hospitals based on their purported failure to meet its RHQDAPU requirements. CMS announced recently that, upon the request for reconsideration by 147 of those hospitals (the first level of the review process), it was reversing its prior decision with respect to 49 hospitals and granting them their full payment update. The remaining hospitals may appeal their denials to the Provider Reimbursement Review Board ("PRRB"). The appeal of quality data reporting is a new area for the PRRB, which typically handles appeals of cost report matters and other final determinations of the fiscal intermediaries.