(a) For discharges occurring on and after December 1, 2009, rates of payment for inpatient hospital services provided by out-of-state providers in accordance with the prior approval requirements set forth in section 365-a(4)(d) of the Social Services Law shall be as follows:

1. (i) the weighted average of inpatient rates, including a teaching adjustment where applicable, in effect for similar services for hospitals located in the downstate region of New York State shall apply with regard to services provided by out-of-state providers located in the New Jersey Counties of Sussex, Passaic, Bergin, Hudson, Essex, Union, Middlesex and Monmouth, in the Pennsylvania County of Pike, and in the Connecticut counties of Fairfield and Litchfield;
2. (ii) for rates effective beginning January 1, 2014, the weighted average of inpatient rates, including a teaching adjustment where applicable, in effect for similar services for hospitals located in the downstate region of New York State shall also apply with regard to services provided by out-of-state providers located in cities where the city’s population census is 500,000 or greater based on the U.S. Department of Commerce United States Census Bureau; and
3. (2) the weighted average of inpatient rates, including a teaching adjustment where applicable, in effect for similar services for hospitals located in the upstate region of New York State shall apply with regard to all other out-of-state providers;
4. (3) high cost outlier rates of payment shall be calculated in accordance with section 86-1.21 of this Subpart with the exception of the wage equalization factor (WEF) being based upon the weighted average of the upstate or downstate region;
5. (4) the weighted average of the capital component of the inpatient rates in effect for similar services for hospitals located in New York State shall apply with regard to services provided by out-of-state providers.

(1)