Title IV, SEC. 4102. REDUCTION IN ADJUSTMENT FOR INDIRECT MEDICAL EDUCATION. Section 1886(d)(5)(B)(ii) (42 U.S.C. 1395ww(d)(5)(B)(ii)) is amended to read as follows: ``(ii) For purposes of clause (i)(II), the indirect teaching adjustment factor is equal to c * (((1+r) to the nth power) - 1), where `r' is the ratio of the hospital's full-time equivalent interns and residents to beds and `n' equals .405. For discharges occurring on or after ``(I) May 1, 1986, and before October 1, 1994, `c' is equal to 1.89, ``(II) October 1, 1994, and before October 1, 1995, `c' is equal to 1.395, and ``(III) October 1, 1995, `c' is equal to 0.74.''.