Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 9503 

ACTION: Final rule; correcting 

amendment. 

SUMMARY: In the November 17, 2010 

issue of the Federal Register, we 

published a final rule that set forth an 

update to the Home Health Prospective 

Payment System (HH PPS) rates, 

including: The national standardized 

60-day episode rates, the national pervisit rates, the nonroutine medical 

supply (NRS) conversion factors, and 

the low utilization payment amount 

(LUPA) add-on payment amounts, 

under the Medicare prospective 

payment system for HHAs. This 

correcting amendment corrects a 

technical error identified in the 

November 17, 2010 final rule. 

DATES: Effective Date: This correcting 

amendment is effective February 18, 

2011. 

FOR FURTHER INFORMATION CONTACT: 

Randy Throndset, (410) 786–0131. 

SUPPLEMENTARY INFORMATION: 

I. Background 

In FR Doc. 2010–27778 (75 FR 70372), 

the final rule entitled ‘‘Medicare 

Program; Home Health Prospective 

Payment System Rate Update for 

Calendar Year 2011; Changes in 

Certification Requirements for Home 

Health Agencies and Hospices’’ 

(hereinafter referred to as the CY 2011 

HH PPS final rule), there was a 

technical error that is identified and 

corrected in the regulations text of this 

correcting amendment. The provisions 

of this correcting amendment are 

effective January 1, 2011. 

II. Summary of Errors in the 

Regulations Text 

On page 70464 of the CY 2011 HH 

PPS final rule, we made a technical 

error in the regulation text of 

§ 424.22(b)(1). That language 

inadvertently deleted paragraphs 

(b)(1)(i) and (ii). Accordingly, we are 

adding those paragraphs in this 

correcting amendment. 

III. Waiver of Proposed Rulemaking 

and Delay in Effective Date 

We ordinarily publish a notice of 

proposed rulemaking in the Federal 

Register to provide a period for public 

comment before the provisions of a rule 

take effect in accordance with section 

553(b) of the Administrative Procedure 

Act (APA) (5 U.S.C. 553(b)). However, 

we can waive this notice and comment 

procedure if the Secretary finds, for 

good cause, that the notice and 

comment process is impracticable, 

unnecessary, or contrary to the public 

interest, and incorporates a statement of 

the finding and the reasons therefore in 

the notice. 

Section 553(d) of the APA ordinarily 

requires a 30-day delay in effective date 

of final rules after the date of their 

publication in the Federal Register. 

This 30-day delay in effective date can 

be waived, however, if an agency finds 

for good cause that the delay is 

impracticable, unnecessary, or contrary 

to the public interest, and the agency 

incorporates a statement of the findings 

and its reasons in the rule issued. 

Our policy on timing and signature of 

recertification for home health services 

in the calendar year (CY) 2011 final rule 

has previously been subjected to notice 

and comment procedures. These 

corrections are consistent with the 

discussion of this policy in the CY 2011 

final rule and do not make substantive 

changes to this policy. This correcting 

amendment merely corrects technical 

errors in the regulations text of the CY 

2011 final rule. As a result, this 

correcting amendment is intended to 

ensure that the CY 2011 final rule 

accurately reflects the policy adopted in 

the final rule. Therefore, we find that 

undertaking further notice and comment 

procedures to incorporate these 

corrections into the final rule is 

unnecessary and contrary to the public 

interest. 

For the same reasons, we are also 

waiving the 30-day delay in effective 

date for this correcting amendment. We 

believe that it is in the public interest 

to ensure that the CY 2011 final rule 

accurately states our policy on timing 

and signature of recertification for home 

health services. Thus delaying the 

effective date of these corrections would 

be contrary to the public interest. 

Therefore, we also find good cause to 

waive the 30-day delay in effective date. 

List of Subjects in 42 CFR Part 424 

Emergency medical services, Health 

facilities, Health professions, Medicare, 

Reporting and recordkeeping 

requirements. 

Accordingly, the Centers for Medicare 

& Medicaid Services corrects 42 CFR 

part 424 by making the following 

correcting amendment: 

PART 424—CONDITIONS FOR 

MEDICARE PAYMENT 

■ 1. The authority citation for part 424 

continues to read as follows: 

Authority: Secs. 1102 and 1871 of the 

Social Security Act (42 U.S.C. 1302 and 

1395hh). 

■ 2. Amend § 424.22 by adding 

paragraphs (b)(1)(i) and (b)(1)(ii) to read 

as follows: 

§ 424.22 Requirements for home health 

services. 

* * * * * 

(b) * * * 

(1) * * * 

(i) Beneficiary elected transfer; or 

(ii) Discharge and return to the same 

HHA during the 60-day episode. 

* * * * * 

Authority: (Catalog of Federal Domestic 

Assistance Program No. 93.773, Medicare— 

Hospital Insurance; and Program No. 93.774, 

Medicare—Supplementary Medical 

Insurance Program) 

Dated: February 10, 2011. 

Dawn L. Smalls, 

Executive Secretary to the Department. 

[FR Doc. 2011–3779 Filed 2–17–11; 8:45 am] 

BILLING CODE 4120–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Parts 483, 488, 489 and 498 

[CMS–3230–IFC] 

RIN 0938–AQ09 

Medicare and Medicaid Programs; 

Requirements for Long-Term Care 

(LTC) Facilities; Notice of Facility 

Closure 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Interim final rule with comment 

period. 

SUMMARY: This interim final rule 

amends the requirements that a longterm care (LTC) facility must meet in 

order to qualify to participate as a 

skilled nursing facility (SNF) in the 

Medicare program, or a nursing facility 

(NF) in the Medicaid program. These 

requirements implement section 6113 of 

the Affordable Care Act to ensure that, 

among other things, in the case of a LTC 

facility closure, individuals serving as 

administrators of a SNF or NF provide 

written notification of the impending 

closure and a plan for the relocation of 

residents at least 60 days prior to the 

impending closure or, if the Secretary 

terminates the facility’s participation in 

Medicare or Medicaid, not later than the 

date the Secretary determines 

appropriate. 

DATES: Effective Date: March 23, 2011. 

Comments: To be assured 

consideration, comments must be 

received at one of the addresses 

provided below, no later than 5 p.m. on 

April 19, 2011. 

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9504 Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 

ADDRESSES: In commenting, please refer 

to file code CMS–3230–IFC. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (FAX) 

transmission. 

You may submit comments in one of 

four ways (please choose only one of the 

ways listed): 

1. Electronically. You may submit 

electronic comments on this regulation 

to http://www.regulations.gov. Follow 

the instructions under the ‘‘More Search 

Options’’ tab. 

2. By regular mail. You may mail 

written comments to the following 

address only: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–3230–IFC, P.O. Box 8010, 

Baltimore, MD 21244–8010. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By express or overnight mail. You 

may send written comments to the 

following address only: Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services, Attention: CMS–3230–IFC, 

Mail Stop C4–26–05, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

4. By hand or courier. If you prefer, 

you may deliver (by hand or courier) 

your written comments before the close 

of the comment period to either of the 

following addresses: 

a. For delivery in Washington, DC— 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Room 445–G, Hubert 

H. Humphrey Building, 200 

Independence Avenue, SW., 

Washington, DC 20201. 

(Because access to the interior of the 

Hubert H. Humphrey Building is not 

readily available to persons without 

Federal government identification, 

commenters are encouraged to leave 

their comments in the CMS drop slots 

located in the main lobby of the 

building. A stamp-in clock is available 

for persons wishing to retain a proof of 

filing by stamping in and retaining an 

extra copy of the comments being 

filed.). 

b. For delivery in Baltimore, MD— 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

If you intend to deliver your 

comments to the Baltimore address, 

please call telephone number (410) 786– 

9994 in advance to schedule your 

arrival with one of our staff members. 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

received after the comment period. 

Submission of comments on 

paperwork requirements. You may 

submit comments on this document’s 

paperwork requirements by following 

the instructions at the end of the 

‘‘Collection of Information 

Requirements’’ section in this document. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: 

Kadie Thomas, (410) 786–0468. Mary 

Collins, (410) 786–3189. 

SUPPLEMENTARY INFORMATION: Inspection 

of Public Comments: All comments 

received before the close of the 

comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. We post all comments 

received before the close of the 

comment period on the following Web 

site as soon as possible after they have 

been received: http:// 

www.regulations.gov. Follow the search 

instructions on that Web site to view 

public comments. 

Comments received timely will also 

be available for public inspection as 

they are received, generally beginning 

approximately 3 weeks after publication 

of a document, at the headquarters of 

the Centers for Medicare & Medicaid 

Services, 7500 Security Boulevard, 

Baltimore, Maryland 21244, Monday 

through Friday of each week from 

8:30 a.m. to 4 p.m. To schedule an 

appointment to view public comments, 

phone 1–800–743–3951. 

I. Legislative and Regulatory 

Background 

According to the Centers for Medicare 

and Medicaid Services (CMS) data, as of 

April 2010, there are 15,713 long-term 

care (LTC) facilities (commonly referred 

to as nursing homes) in the U.S. LTC 

facilities are also referred to as skilled 

nursing facilities (SNFs) in the Medicare 

program and as nursing facilities (NFs) 

in the Medicaid program. For the past 

decade, CMS Online Survey 

Certification and Reporting (OSCAR) 

data have shown a decline in the 

number of nursing homes, from 17,508 

in 1999 to 15,713 in 2010. In 2009, there 

were 231 nursing home closures. In 

2010, there were 191 closures. 

LTC facility closures have 

implications related to access to care, 

the quality of care, availability of 

services, and the overall health of 

residents. Therefore, having an 

organized process facilities must follow 

in the event of a nursing home closure 

would protect residents’ health and 

safety, and make the transition as 

smooth as possible for residents, as well 

as family members and facility staff. 

A. Current Regulatory Requirements for 

Notification of Closure to Residents of 

LTC Facilities 

Currently, requirements for the 

protection of residents’ rights in the case 

of facility closure are found at 42 CFR 

483.12(a), Transfer and Discharge. 

Section § 483.12(a)(2), Transfer and 

discharge requirements, prohibits 

facilities from transferring or 

discharging a resident from the facility, 

except under certain circumstances, 

including cessation of operations. 

Section § 483.12(a)(4), Notice before 

transfer, requires that before a facility 

transfers or discharges a resident, the 

facility must notify the resident and, if 

known, a family member or legal 

representative of the resident, of the 

transfer or discharge and the reasons for 

the move in writing and in a language 

and manner they understand. 

Section § 483.12(a)(5), Timing of the 

notice, requires facilities to inform 

residents 30 days before the resident is 

transferred or discharged, except in the 

case of certain specific circumstances 

that include, for example, an immediate 

transfer or discharge due to a resident’s 

urgent medical needs. In such cases, the 

notification must be made ‘‘as soon as is 

practicable.’’ State laws regarding 

notification of LTC facility closures 

vary, with the majority of States 

requiring 30 days notice prior to 

closure. However, there are some States 

that require up to 90 days notice, such 

as Vermont, Illinois and Pennsylvania 

(see (http://www.sph.umn.edu/hpm/ 

nhregsPlus/category_attachments/

category_admission_discharge_transfer_

rights.pdf#pagemode=

bookmarks&page=1 for information on 

these States and general background on 

State regulations pertaining to nursing 

facility admission, transfer, and 

discharge rights). 

Section § 483.12(a)(6), Contents of the 

notice, specifies what must be included 

in such notifications, for example the 

location to which the resident is being 

transferred or discharged. Finally, 

§ 483.12(a)(7), Orientation for transfer or 

discharge, requires a facility to provide 

sufficient preparation and orientation to 

residents to ensure safe and orderly 

transfer or discharge from the facility. 

Section § 488.426 Transfer of 

residents, or closure of the facility and 

transfer of residents, gives authority to 

the State in emergency situations. 

Section 488.426 (a), which is not being 

revised in this rule, requires that, in an 

emergency, the State has the authority 

to—(1) Transfer Medicaid and Medicare 

residents to another facility; or (2) Close 

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the facility and transfer the Medicaid 

and Medicare residents to another 

facility. 

If a facility closes permanently due to 

an emergency, the administrator is 

required to provide proper notification. 

However, if the State temporarily 

relocates residents during an emergency 

with the expectation that the residents 

will return to the facility, we would not 

regard this situation to be a facility 

closure and would not require the 

administrator to provide notification. 

For example, CMS recently received 

notification that a facility’s air 

conditioning failed during a heat wave. 

The State ordered the facility to relocate 

all of its residents while the problem 

was being investigated but did not close 

the facility. Since the States customarily 

provide notification under § 488.426 for 

emergency-related closures, CMS is not 

proposing the administrator be required 

to provide such notification. 

B. Requirements for Notification of 

Closure to Other Individuals or Entities 

Currently, there are no Federal 

regulations requiring that a LTC facility 

notify the Secretary or a State’s LTC 

ombudsman prior to closure of a LTC 

facility and there are no Federal 

requirements for submission of a plan 

for closure of a LTC facility to any 

individual or entity. 

C. Legislative Requirements and the 

Affordable Care Act Amendments 

Sections 1819(b)(1)(A) of the Social 

Security Act (the Act) for SNFs and 

1919(b)(1)(A) of the Act for NFs both 

state that a SNF/NF must care for its 

residents in such a manner and in such 

an environment as will promote 

maintenance or enhancement of the 

quality of life of each resident. 

Sections 1819(c)(2)(A) and 

1919(c)(2)(A) of the Act state that in 

general, with certain specified 

exceptions, a SNF/NF must permit each 

resident to remain in the facility and 

must not transfer or discharge the 

resident from the facility. 

Section 6102 of the Affordable Care 

Act of 2010 (Pub. L. 111–148, March 23, 

2010) added a new section 1128I to the 

Act to promote greater accountability for 

LTC facilities (defined as skilled nursing 

facilities and nursing facilities pursuant 

to new subsection 1128I(a) of the Act). 

Section 6113 of the Affordable Care Act 

added an additional subsection 1128I(h) 

to the Act, setting forth certain 

requirements for LTC facility closures, 

effective March 23, 2011, as follows: 

1. Notification of Facility Closure 

Section 1128I(h)(1)(A)(i) of the Act, as 

added by the Affordable Care Act, states 

that in general, any individual who is 

the administrator of the facility must 

submit to the Secretary, the State LTC 

ombudsman, residents of the facility, 

and the legal representatives of such 

residents or other responsible parties, 

written notification of an impending 

facility closure. 

For informational purposes, LTC 

ombudsmen are advocates for residents 

of nursing homes, board and care homes 

and assisted living facilities. 

Ombudsmen provide information about 

how to find a facility and what to do to 

get quality care. They are trained to 

resolve problems, and will assist 

individuals with complaints; however, 

unless an ombudsman is given 

permission, these matters are kept 

confidential. Under the Federal Older 

Americans Act, every State is required 

to have an Ombudsman Program that 

addresses complaints and advocates for 

improvements in the LTC system 

(http://www.ltcombudsman.org/). 

For voluntary or State-mandated 

closures, the required written 

notification must not be later than 60 

days prior to the date of such closure. 

Section 1128I(h)(1)(A)(ii) of the Act 

states that if the Secretary terminates the 

facility’s participation under this title, 

notification must be provided no later 

than the date that the Secretary 

determines appropriate. Section 

1128I(h)(1)(B) of the Act states that the 

administrator must also ensure that the 

facility does not admit any new 

residents on or after the date on which 

such written notification is submitted. 

Finally, section 1128I(h)(1)(C) of the 

Act states that LTC facilities must 

include in their closure notices a plan, 

approved by the State, for the transfer 

and adequate relocation of residents of 

the facility by a specified date prior to 

closure. The notices must also include 

assurances that the residents will be 

transferred to the most appropriate 

facility or other setting in terms of 

quality, services, and location, taking 

into consideration the needs, choice, 

and best interests of each resident. 

2. Relocation 

Section 1128I(h)(2)(A) of the Act 

requires a State to ensure, before a 

facility in the State closes, that all 

residents of the facility have been 

successfully relocated to another facility 

or an alternative home and communitybased setting. Because this requirement 

applies to States and not the LTC 

facility, we have not included it in this 

rule for LTC facilities. We will 

implement this statutory requirement 

through sub-regulatory guidance to be 

published in the State Operations 

Manual (SOM) as interpretive guidance 

for surveyors. We are requesting 

comments on the best means of 

implementing this provision. 

Section 1128I(h)(2)(B) of the Act 

authorizes the Secretary to continue to 

make payments under this title with 

respect to residents of a facility that has 

submitted the required notifications 

under section 1128I(h)(1) during the 

period beginning on the date such 

notification is submitted and ending on 

the date on which the resident is 

successfully relocated. 

3. Sanctions 

Section 1128I(h)(3) of the Act, as 

added by the Affordable Care Act, states 

that any individual who is the 

administrator of the facility that fails to 

comply with the requirements set out in 

the subsection shall be subject to a civil 

monetary penalty of up to $100,000, 

may be subject to exclusion from 

participation in any Federal health care 

program (as defined in section 1128B(f) 

of the Act), and shall be subject to any 

other penalties that may be prescribed 

by law. 

Additionally, Section 1128I(h)(4) of 

the Act ‘‘Procedure,’’ states that the 

provisions of section 1128A of the Act 

(other than subsections (a) and (b) and 

the second sentence of subsection (f)) 

shall apply to a civil money penalty or 

exclusion under paragraph (3) in the 

same manner as such provisions apply 

to a penalty or proceeding under section 

1128A(a) of the Act. 

Subsection 6113(c) of the Affordable 

Care Act requires that the provisions of 

new subsection 1128I(h) of the Act 

become effective one year after the date 

of enactment—that is, March 23, 2011. 

Therefore, because of the statutory 

deadline, we are implementing this rule 

as an interim final rule with comment 

period. 

II. Health Disparities 

CMS is committed to developing 

regulation in a manner that focuses on 

improving the quality of health care for 

all persons. Therefore, we believe that it 

is important in the preamble of 

regulations to discuss our goal of 

addressing health care disparities and to 

solicit comments on how our 

regulations could be used to address 

such disparities. 

In 1985, the Secretary of the 

Department of Health and Human 

Services issued a landmark report that 

revealed large and persistent gaps in 

health status among Americans of 

different racial and ethnic groups and 

served as an impetus for addressing 

health inequalities for racial and ethnic 

minorities in the U.S. This report led to 

the establishment of the Office of 

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Minority Health (OMH) within the 

Department of Health and Human 

Services (HHS), with a mission to 

address these disparities. National 

concern for these differences, termed 

health disparities, and the associated 

excess mortality and morbidity have 

been expressed as a high priority in 

national health status reviews, 

including Healthy People 2000 and 

2010. 

Since that time, research has 

extensively documented the 

pervasiveness of racial and ethnic 

disparities in health care and has led to 

the acknowledgement of racial and 

ethnic disparities as a national problem. 

As a result, more populations have been 

identified as vulnerable, which has 

necessitated the development of 

programs and strategies to reduce 

disparities for vulnerable populations, 

as well as the emergence of new 

leadership to address such disparities. 

Currently, vulnerable populations can 

be defined by race/ethnicity, socioeconomic status, geography, gender, age, 

disability status, sexual orientation, and 

other populations identified to be at-risk 

for health disparities. Other populations 

at risk may include persons with visual 

or hearing problems, cognitive 

perceptual problems, language barriers, 

pregnant women, infants, and persons 

with disabilities or special health care 

needs. 

Although there has been much 

attention at the national level to ideas 

for reducing health disparities in 

vulnerable populations, we remain 

vigilant in our efforts to improve health 

care quality for all persons by improving 

health care access and by eliminating 

real and perceived barriers to care that 

may contribute to less than optimal 

health outcomes for vulnerable 

populations. For example, we are aware 

that immunization rates remain low 

among some minorities. Despite the 

long-term implementation of some 

strategies, such as the use of language 

translators in hospitals, health literacy 

and its impact on health care outcomes 

continues to be in the forefront. 

We are always seeking better ways to 

address the needs of vulnerable 

populations; therefore, we are 

specifically requesting comments in 

regard to how our LTC facility closure 

requirements could be used to address 

disparities among facility residents. 

III. Provisions of the Interim Final Rule 

With Comment Period 

Based on the provisions of section 

1128I(h) of the Act, as added by the 

Affordable Care Act, we are revising the 

current requirements for LTC facilities, 

as discussed below. Under this new 

provision the administrator of the 

facility will be subject to sanctions for 

failure to provide proper notice 

according to these new provisions. 

However, in some cases, an 

administrator has no control over 

closure procedures. For instance, an 

administrator may be hired to oversee a 

facility’s impending closure, although 

he or she was not present when the 

decision was made to close, or the 

administrator was employed fewer than 

60 days prior to closure. In regards to 

LTC facilities, this is the first regulation 

where civil monetary penalties would 

be imposed on an individual. CMS 

considered the impact that this rule 

would have on an administrator that 

would be in a facility for an insufficient 

amount of time to comply with this 

regulation. We believe that the Congress 

intended CMS to use sanctions as a 

method to assure that the requirements 

in the statue be implemented. The 

language that the Congress used was ‘‘up 

to $100,000.’’ They used this language to 

have a maximum amount, but intended 

for CMS to determine the amount of the 

sanctions. Due to the many possible 

combinations of violations that could be 

cited gradations would be limited to the 

number of offenses. Any sanctions that 

have been levied against an 

administrator would also be reviewed 

by the State’s licensing agency for 

possible disciplinary action including 

suspension and termination of the 

administrator’s license. Because of the 

unique Federal laws applicable to the 

operation of IHS and Tribal LTC 

facilities under the authority of 25 

U.S.C. 1621(d), the implementation of 

this IFC by such facilities will be 

developed in consultation with the IHS 

and Tribal programs. 

A. Transfer and Discharge § 483.12(a) 

We are revising § 483.12(a) by 

redesignating current paragraph (a)(8) as 

paragraph (a)(9) and adding a new 

§ 483.12(a)(8) to require that, in the case 

of a facility closure, any individual who 

is the administrator of the facility must 

provide written notification prior to the 

impending closure to the Secretary, the 

State LTC ombudsman, the residents of 

the facility, and the legal representatives 

of such resident or other responsible 

parties, as well as provide a plan for the 

transfer and adequate relocation of the 

residents, in accordance with new 

§ 483.75(r). 

We are also revising § 483.12(a)(5)(i) 

‘‘Timing of the notice’’, which allows for 

exceptions to the 30-day notification 

requirement for closures. We are adding 

a statement that newly added paragraph 

(a)(8), which generally states who must 

file a notice and plan and to whom the 

notice and plan must be filed in the 

event of impending closure, is also an 

exception to the timing requirements 

found in paragraph (a)(5)(i). 

B. Facility Closure-Administrator 

§ 483.75(r) 

We are adding a new subsection (r) to 

§ 483.75. At § 483.75(r)(1), we are 

requiring that any individual who is the 

administrator of the facility must submit 

to the Secretary, the State LTC 

ombudsman, residents of the facility, 

and the legal representative of such 

residents (or other responsible parties) 

written notification of an impending 

closure at least 60 days prior to the date 

of closure; or, in the case of a facility 

where the Secretary terminates the 

facility’s participation in the Medicare 

and/or Medicaid programs, not later 

than the date that the Secretary 

determines appropriate for such 

notification. 

To understand how the Secretary may 

determine a date for a notification when 

the Secretary has terminated the 

facility’s participation in Medicare, 

Medicaid, or both, we are providing 

background on facility requirements to 

participate in these programs. The 

Secretary may terminate a facility’s 

participation if the facility fails in any 

area outlined in § 489.53(a)(1) through 

(a)(15). For instance, at § 489.53(a)(3), 

failure to continue to meet the 

appropriate conditions of participation 

or requirements for SNFs and NFs set 

forth elsewhere in this chapter would be 

grounds for termination by CMS. In 

addition, the timing of the notification 

of termination by the Secretary may 

vary based on the justification for the 

closure. Section 489.53(d)(1) provides 

the basic timing rule for notice of 

termination by CMS, which is 15 days 

before the effective date of termination 

of the provider agreement. Section 

489.53(d)(2)(ii) provides the timing rule 

for closures that are the result of 

deficiencies that may pose immediate 

jeopardy, which is 2 days prior to the 

effective date of the termination of the 

provider agreement. 

In addition, at § 483.75(r)(2) we are 

requiring any individual who is the 

administrator of the LTC facility to 

ensure that the facility does not admit 

any new residents on or after the date 

on which such written notification is 

submitted to the Secretary, the State 

LTC ombudsman, and the residents, 

and/or their representatives or other 

responsible parties. 

At § 483.75(r)(3), we are requiring that 

any individual who is the administrator 

of a LTC facility include in the written 

notice of closure, a plan that has been 

approved by the State for the transfer 

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Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 9507 

and adequate relocation of the residents 

of the facility by a date that would be 

specified prior to closure, including 

assurances that the residents would be 

transferred to the most appropriate 

facility or other setting in terms of 

quality, services, and location, taking 

into consideration the needs, choice, 

and best interests of each resident. 

We would expect that the closure 

plan would include sufficient detail to 

clearly identify the steps the facility 

would take, and the individual 

responsible for ensuring the steps are 

successfully carried out. As an example, 

the plan might include: (among other 

things): 

• Assessment of residents’ care needs 

and the provision of appropriate 

services. 

• A plan for communicating with 

staff and/or unions. 

• Continuation of appropriate staffing 

levels and paychecks at the facility. 

• Provision of necessary supplies. 

• Identification of available facilities 

to which residents could be transferred, 

along with an assessment of the quality 

of care provided by these facilities (for 

example, Minimum Data Set (MDS) 

OSCAR data). 

• A process for relocation of 

residents. 

• Operation and management of the 

facility and oversight of those managing 

the facility. 

• The roles and responsibilities of the 

facility’s Administrator or replacement. 

• Sources of supplemental funding to 

assist in keeping a facility open until the 

residents are transferred. 

• A plan for communicating with the 

Secretary, the State LTC ombudsman, 

residents and legal representatives of 

the residents or other responsible 

parties. 

C. Facility Closure § 483.75(s) 

We are adding § 483.75(s) to require 

that the facility have in place policies 

and procedures that will ensure the 

administrator’s duties and 

responsibilities involve providing the 

appropriate notices. While this 

provision is not explicitly required by 

section 1128I(h), we believe that it is 

implicitly authorized by the terms of 

section 6113 of the Affordable Care Act. 

Moreover, it is explicitly permitted by 

the general rulemaking authority of 

sections 1819(d)(4)(B) and 1919(d)(4)(B) 

of the Act, which permit the Secretary 

to issue rules relating to the health, 

safety and well-being of residents, and 

rules concerning physical facilities. The 

facility will not be sanctioned for 

noncompliance with this rule; however, 

it will be cited for a deficiency during 

the survey process. 

D. Transfer of Residents, or Closure of 

the Facility and Transfer of Residents 

§ 488.426 

At § 488.426, we are revising 

paragraph (b) to include a crossreference to the new requirements at 

§ 483.75(r). We are also adding 

paragraph (c) Required notifications 

when a facility’s provider agreement is 

terminated to address the required 

notifications when a facility closes. 

E. Administrator Sanctions: Long-Term 

Care Facility Closures § 488.446 

As required by Section 6113 of the 

Affordable Care Act, new § 488.446 will 

subject any administrator of a facility 

that fails to comply with the 

requirements at § 483.75(r) to sanctions. 

Such individual— 

(1) Would be subject to a civil 

monetary penalty as follows: A 

minimum of $500 for the first offense; 

a minimum of $1,500 for the second 

offense; and a minimum of $3,000 for 

the third and subsequent offenses. The 

three levels of civil monetary penalties 

(CMPs) represent a minimum amount 

for each offense; however, an 

administrator could be subject to higher 

amounts of CMPs (not to exceed 

$100,000) based on criteria that CMS 

will identify in interpretative 

guidelines. If it is determined that an 

administrator of record completely fails 

to take the necessary and timely actions 

to adhere to the Notice of Facility 

Closure thus causing unjustified harm to 

the resident, family, and visitors, then 

the administrator could be subject to 

additional CMPs. For example, the 

administrator abandons his or her 

responsibility as set forth in the Notice 

of Facility Closure for the purpose of 

personal gain (financial) by devoting his 

or her energies to keeping the facility 

open rather than working on a safe and 

timely closure. 

(2) Could be subject to exclusion from 

participation in any Federal health care 

program (as defined in section 1128B(f) 

of the Act); and 

(3) Would be subject to any other 

penalties that may be prescribed by law. 

F. Period of Continued Payments 

§ 488.450(c) 

At § 488.450(c), we are renumbering 

this section to add paragraphs (1) and 

(2). Current § 488.450(c) corresponds 

with new § 488.450(c)(1), and new 

paragraph (2) provides that the 

Secretary may, as deemed appropriate, 

continue to make payments under this 

title with respect to residents of an LTC 

facility that has submitted a notification 

of closure during the period beginning 

on the date such notification is 

submitted and ending on the date on 

which the resident is successfully 

relocated. 

G. Notice to CMS § 489.52(a) 

We are revising § 489.52(a)(1) to 

provide an exception for SNFs, 

redesignating paragraph (a)(2) as 

paragraph (a)(3), and outlining the 

requirement specific to SNF 

notifications to CMS in new paragraph 

(a)(2). 

At § 489.52(a)(2), we are requiring that 

a SNF provider that wishes to terminate 

its agreement must send CMS written 

notice of its intent at least 60 days prior 

to the date of closure, in accordance 

with § 483.75(r)(1)(i). 

H. Skilled Nursing Facility Closure 

§ 489.53(d)(3) 

At § 489.53(d)(3), we are revising and 

redesignating the section to state that 

when CMS terminates a facility’s 

participation under Medicare or 

Medicaid, CMS will determine the date 

of the required notifications. We are also 

revising § 489.53(d)(1) to reflect this 

change. 

I. Exceptions to Effective Date of 

Termination § 489.55 

When a notification is made as 

required at § 483.75(r), the new 

requirements authorize the Secretary to 

continue to make payments to the SNF 

or, for a NF, to the State, as the 

Secretary considers appropriate, during 

the period beginning at the time the 

notification is submitted and until the 

resident is successfully relocated. We 

renumbered this section to redesignate 

paragraphs (a) and (b) as paragraphs (1) 

and (2), and added a new paragraph (b) 

to implement this requirement. 

J. Scope and Applicability § 498.3 

We are adding § 498.3(a)(2)(iv) to 

clarify that CMS may also impose 

sanctions on NF administrators for 

noncompliance with § 483.75(r). In 

addition, we are adding a new 

subparagraph § 498.3(a)(3)(ii) to indicate 

that the appeals process applies to NFs 

as well as SNFs. 

We are adding to § 498.3(b) Initial 

determinations by CMS, a new 

paragraph (18) to indicate that a 

sanction imposed on a SNF or NF 

administrator for noncompliance with 

the requirements set out at § 483.75(r) 

constitutes an initial determination of 

the agency. 

K. Appeal Rights § 498.5 

At § 498.5, we are adding paragraph 

(m) Appeal rights of an individual who 

is the administrator of a SNF or NF to 

establish appeal rights for administrator 

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sanctions for noncompliance with the 

requirements set out at § 483.75(r). 

IV. Response to Comments 

Because of the large number of public 

comments we normally receive on 

Federal Register documents, we are not 

able to acknowledge or respond to them 

individually. We will consider all 

comments we receive by the date and 

time specified in the DATES section of 

this preamble, and, when we proceed 

with a subsequent document, we will 

respond to the comments in the 

preamble to that document. 

V. Waiver of Proposed Rulemaking 

We ordinarily publish a notice of 

proposed rulemaking in the Federal 

Register and invite public comment on 

the interim final rule in accordance with 

5 U.S.C. 553(b) of the Administrative 

Procedure Act (APA). The notice of 

proposed rulemaking includes a 

reference to the legal authority under 

which the rule is proposed, and the 

terms and substances of the interim 

final rule or a description of the subjects 

and issues involved. This procedure can 

be waived, however, if an agency finds 

good cause that a notice-and-comment 

procedure is impracticable, 

unnecessary, or contrary to the public 

interest and incorporates a statement of 

the finding and its reasons in the rule 

issued. 

Section 6113 of the Affordable Care 

Act, effective March 23, 2011, added 

new section 1128I(h) of the Act, which 

requires that the administrator of a 

facility follow specified procedures 

prior to closure of a facility. The Act 

requires any individual who is the 

administrator to provide written 

notification to the Secretary, the State 

LTC ombudsman, residents of the 

facility, and the legal representatives of 

such residents or other responsible 

parties, of an impending facility closure. 

As mentioned above, LTC facility 

closures have implications for access, 

the quality of care provided, availability 

of services, and the overall health of 

residents, necessitating that an 

organized process be followed in the 

event of a nursing home closure. The 

Congress mandated at subsection 

6113(c) of the Affordable Care Act that 

these amendments take effect one year 

after the date of the enactment of this 

Act. 

We believe that, in mandating a 1 year 

effective date, the Congress was 

acknowledging the importance of 

protecting the vulnerable elderly 

residents of LTC facilities. Advance 

notice of facility closure allows a 

resident and his or her legal 

representative or interested family 

member to prepare for the move to 

another facility, which can prove very 

traumatic to the resident. A move 

uproots a resident from a familiar 

environment, including a roommate and 

other residents, as well as assigned care 

providers, sometimes including the 

resident’s physician. LTC facility 

closures require critical adjustments and 

create difficult issues for residents and 

their families and representatives. The 

Affordable Care Act under section 

1128I(h) mandates specific procedures 

in the event of a closure of a nursing 

home. These procedures help protect 

the resident, the resident’s family, and 

visitors because it requires the facility to 

provide an organized plan that allows 

the resident, family, and visitors to 

make the necessary adjustments within 

a reasonable time frame. At present, no 

Federal rule exists for facility closure. 

Delaying the implementation of the rule 

would continue to cause unjustified 

harm to the resident, family, and 

visitors. 

We believe that to publish this rule as 

a proposed rule would jeopardize the 

safety of these individuals and the 

fulfillment of the mandated 

implementation date of March 23, 2011. 

Thus, we find that the Congressional 

directive renders adherence to the 

normal notice of proposed rulemaking 

requirements under the APA both 

impracticable and contrary to the public 

interest. Therefore, we find good cause 

to waive the notice of proposed 

rulemaking and to issue this final rule 

on an interim basis. We are providing a 

60-day public comment period. In 

accordance with section 1871(a)(3) of 

the Act, all Medicare interim final rules 

must be finalized within three years. 

VI. Collection of Information 

Requirements 

Under the Paperwork Reduction Act 

of 1995, we are required to provide 

60-day notice in the Federal Register 

and solicit public comment before a 

collection of information requirement is 

submitted to the Office of Management 

and Budget (OMB) for review and 

approval. In order to fairly evaluate 

whether an information collection 

should be approved by OMB, section 

3506(c)(2)(A) of the Paperwork 

Reduction Act of 1995 requires that we 

solicit comment on the following issues: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of our agency. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

We are soliciting public comment on 

each of these issues for the following 

sections of this document that contain 

information collection requirements 

(ICRs): 

The revisions at § 483.12(a)(8) require 

any individual who is the administrator 

of the facility to submit to the Secretary, 

the State LTC ombudsman, residents 

and their legal representatives or other 

responsible parties, written notification 

of an impending closure at least 60 days 

prior to such closure; or not later than 

the date that the Secretary deems 

appropriate in the case of a facility 

where the Secretary terminates the 

facility’s participation under this title. 

Current regulations at § 483.12(a)(5) 

require notification of transfer or 

discharge to a resident and, if known, a 

family member or legal representative, 

in writing. Except in certain specified 

circumstances, notification must be 

made at least 30 days prior to transfer 

or discharge. Facility closure is not a 

circumstance that permits a facility to 

make notification in fewer than 30 days. 

Although the requirement extends the 

time period for notification from 30 

days to 60 days (or a date determined 

by the Secretary in case of CMS 

termination of the facility), we do not 

believe the change in the time period for 

reporting imposes any additional 

burden. In addition, notification of 

transfer or discharge to residents and 

their representatives is already a usual 

and customary business practice. 

Therefore, in accordance with 5 CFR 

1320.3(b)(2), we will not include this 

activity in the ICR burden analysis. 

Although there are no existing Federal 

regulatory requirements for LTC 

facilities to notify other individuals or 

entities of an impending closure, 

according to feedback to CMS from State 

surveyors for LTC facilities, nearly all 

States already require LTC facilities to 

notify the State within 30 to 90 days. 

Because we have found that 

notifications of impending closure are a 

standard business practice for most LTC 

facilities, we believe that this 

requirement would impose burden on 

only a small number of facilities. 

Each facility that does not already 

notify the State and the State LTC 

ombudsman must develop a process for 

doing so. We estimate that the burden 

associated with complying with this 

requirement would be due to the 

resources required to develop a process 

for notifying the State and the State LTC 

ombudsman and the time it takes to 

notify those entities. We expect that 

such a notification process would 

involve the administrator of the facility 

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Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 9509 

and administrative support person and 

an attorney to review the plan. 

We anticipate that, on average, it will 

take 7 hours for a total burden of 

$5,584,400.16. 

The revisions at § 483.75(r)(2) require 

that the administrator of the facility 

ensure that the facility does not admit 

any new residents on or after the date 

written notification is submitted. We do 

not anticipate any ICR burden 

associated with this requirement. 

Section 483.75(r)(3) requires the 

administrator of the facility to include 

in the notice the plan for the transfer 

and adequate relocation of the residents 

of the facility by a date that is specified 

by the State prior to closure, including 

assurances that the residents would be 

transferred to the most appropriate 

facility or other setting in terms of 

quality, services, and location, taking 

into consideration the needs, choice, 

and best interests of each resident. 

Section 483.75(s) requires the facility 

to have in place policies and procedures 

to ensure that the administrator’s duties 

and responsibilities include the 

provision of the appropriate notices in 

the event of a facility closure. 

In our experience, based on feedback 

to CMS from State surveyors of LTC 

facilities, most facilities already have 

plans for transfer of residents, regardless 

of whether closure of the facility is 

expected. For example, most facilities 

have plans for transfer of residents to 

another facility in the event of an 

emergency. Also based on our 

experience, nearly all facilities 

anticipating closure develop plans for 

the relocation of residents and other 

closure-related activities. Many States 

require such plans. For example, 

Vermont requires that the State 

licensing agency and the LTC 

ombudsman be notified by the 

administrator of the facility 90 days 

prior to the proposed date of closure. In 

addition, the facility administrator is 

required to provide to the State 

licensing agency and LTC ombudsman a 

written transfer plan 60 days prior to 

closure. 

Because we have found that transfer 

plans are a standard business practice 

for most LTC facilities, we believe that 

this requirement would impose burden 

on only a small number of facilities. 

Each facility that does not already 

have a plan in place must develop a 

plan for the transfer and adequate 

relocation of residents of the facility. We 

estimate that the burden associated with 

complying with this requirement would 

be due to the resources required to 

develop and review a new plan or, if 

necessary, modify an existing plan for 

the transfer of residents in the event of 

facility closure. We expect that 

development of such a plan would 

involve the administrator of the facility, 

an administrative support person, and 

an attorney to review the plan. 

LTC facilities are currently required to 

have a plan under § 483.12 for discharge 

and transfer of residents. A facility must 

provide sufficient preparation and 

orientation to residents to ensure safe 

and orderly transfer or discharge from 

the facility. Therefore, we anticipate 

that, on average, it will take 3 hours to 

develop the plan, 1 hour to ensure that 

the administrator’s duties include 

policies and procedures relating to 

facility closures, 2 hours for an 

administrative support person to 

prepare the document(s), and 1 hour for 

an attorney to review the document(s), 

for a total estimated burden of 7 hours 

per facility. We also believe that the 

burden would remain approximately the 

same for the first year and beyond. 

Currently, there are 15,713 LTC 

facilities in the U.S. Based on an hourly 

rate of $58.17 for a nursing home 

administrator, we estimate that 

development of the plan and 

incorporating facility closure policies 

and procedures into the administrator’s 

duties would cost $3,656,100.80 (15,713 

facilities × 4 hours per facility) × $58.17 

per hour). Based on an hourly rate of 

$20.11 for an administrative assistant, 

we estimate that preparing the plan 

documents would cost $631,976.86 

((15,713 facilities × 2 hours per facility) 

× $20.11 per hour). Finally, based on an 

hourly rate of $82.50 for an attorney, we 

estimate that reviewing the plan 

document would cost $1,296,322.50 

((15,713 facilities × 1 hour per facility) 

× $82.50 per hour). The salary estimates 

include 33 percent of the mean hourly 

rate for overhead and fringe benefits 

(Source: BLS.gov). 

If you comment on these information 

collection and recordkeeping 

requirements, please submit your 

comments electronically as specified in 

the ADDRESSES section of this interim 

final rule. 

VII. Regulatory Impact Analysis 

A. Statement of Need 

Executive Order 13563 directs 

agencies to consider and discuss 

qualitatively values that are difficult to 

quantify, including equity, human 

dignity, fairness and distributive 

impacts. This IFC will implement the 

Affordable Care Act under section 

1128I(h) that mandates specific 

procedures in the event of a closure of 

a nursing home. LTC facility closure 

procedures have implications related to 

access to care, the quality of care, and 

the overall health of residents. These 

procedures help protect the resident, the 

resident’s family, and visitors because it 

requires the facility to provide an 

organized plan that allows the resident, 

family, and visitors to make the 

necessary adjustments within a 

reasonable time frame. 

B. Overall Impact 

1. Executive Order 12866 

We have examined the impacts of this 

rule as required by Executive Order 

12866 on Regulatory Planning and 

Review (September 30, 1993), Executive 

Order 13563 on Improving Regulation 

and Regulatory Review (February 2, 

2011), the Regulatory Flexibility Act 

(RFA) (September 19, 1980, Pub. L. 96– 

354), section 1102(b) of the Social 

Security Act, the Unfunded Mandates 

Reform Act of 1995 (March 22, 1995; 

Pub. L. 104–4), Executive Order 13132 

on Federalism (August 4, 1999) and the 

Congressional Review Act (5 U.S.C. 

804(2)). 

Executive Order 12866 directs 

agencies to assess all costs and benefits 

of available regulatory alternatives and, 

if regulation is necessary, to select 

regulatory approaches that maximize 

net benefits (including potential 

economic, environmental, public health 

and safety effects, distributive impacts, 

and equity). A regulatory impact 

analysis (RIA) must be prepared for 

major rules with economically 

significant effects ($100 million or more 

in any 1 year). This rule does not qualify 

as a major rule as the estimated 

economic impact. We estimate that 

these requirements will cost $355 

(5,584,400/15,713) per facility the first 

year and each year thereafter. 

2. Regulatory Flexibility Act (RFA) 

The RFA requires agencies to analyze 

options for regulatory relief of small 

businesses, if a rule has a significant 

impact on a substantial number of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

government jurisdictions. The great 

majority of hospitals and most other 

health care providers and suppliers are 

small entities, either by being nonprofit 

organizations or by meeting the SBA 

definition of a small business (having 

revenues of less than $7.0 million to 

$34.5 million in any 1 year). For 

purposes of the RFA, most physician 

practices, hospitals and other providers 

are small entities, either by nonprofit 

status or by qualifying as small 

businesses under the Small Business 

Administration’s size standards 

(revenues of less than $7.0 to $34.5 

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9510 Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 

million in any 1 year). States and 

individuals are not included in the 

definition of a small entity. For details, 

see the Small Business Administration’s 

Web site at http://ecfr.gpoaccess.gov/

cgi/t/text/text-idx?c=ecfr&

sid=2465b064ba6965

cc1fbd2eae60854b11&

rgn=div8&view=text&node=13:

1.0.1.1.16.1.266.9&idno=13. A rule has a 

significant economic impact on the 

small entities it affects, if it significantly 

affects their total costs or revenues. 

Under statute we are required to assess 

the compliance burden the regulation 

will impose on small entities. Generally, 

we analyze the burden in terms of the 

impact it will have on entities’ costs if 

these are identifiable or revenues. As a 

matter of sound analytic methodology, 

to the extent that data are available, we 

attempt to stratify entities by major 

operating characteristics such as size 

and geographic location. If the average 

annual impact on small entities is 3 to 

5 percent or more, it is to be considered 

significant. 

We estimate that these requirements 

will cost $355 ($5,584,400/15,713 

facilities) per facility initially and $355 

($5,584,400/15,713 facilities) thereafter. 

This clearly is much below 1 percent; 

therefore, we do not anticipate it to have 

a significant impact. We do not have 

any data related to the number of LTC 

facilities that have facility closure plans 

in place; however, we are aware through 

our experience with LTC facilities and 

the survey process that most facilities 

have a plan for closure either because 

they are required to have such a plan in 

place at the State level or because of 

their understanding that this is a 

standard business practice. 

3. Social Security Act 

In addition, section 1102(b) of the 

Social Security Act requires us to 

prepare a regulatory impact analysis if 

a rule may have a significant impact on 

the operations of a substantial number 

of small rural hospitals. This analysis 

must conform to the provisions of 

section 604 of the RFA. For the 

purposes of section 1102(b) of the Act, 

we define a small rural hospital as a 

hospital that is located outside of a 

metropolitan statistical area and has 

fewer than 100 beds. This rule would 

impact only SNFs and NFs. Therefore, 

the Secretary has determined that this 

interim final rule would not have any 

impact on the operations of small rural 

hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 (UMRA) 

also requires that agencies assess 

anticipated costs and benefits before 

issuing any rule whose mandates 

require spending in any 1 year of $100 

million in 1995 dollars, updated 

annually for inflation. In 2010, that 

threshold is approximately $135 

million. This rule would not have a 

significant impact on the governments 

mentioned or on private sector costs. 

The estimated economic effect of this 

rule is $5,584,400 the first year and 

$5,584,400 thereafter. These estimates 

are derived from our analysis of burden 

associated with these requirements in 

section IV, ‘‘Collection of Information 

Requirements.’’ 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a 

proposed rule (and subsequent final 

rule) that imposes substantial direct 

requirement costs on State and local 

governments, preempts State law, or 

otherwise has Federalism implications. 

This rule would not have any effect on 

State or local governments. 

C. Anticipated Effects 

1. Effects on LTC Facilities 

The purpose of this rule is to ensure 

that, among other things, in the case of 

a facility closure, any individual who is 

the administrator of the facility provide 

written notification of the closure and 

the plan for the relocation of residents 

at least 60 days prior to the impending 

closure or, if the Secretary terminates 

the facility’s participation in Medicare 

or Medicaid, not later than the date the 

Secretary determines appropriate. This 

would protect residents’ health and 

safety and make the transition to closure 

as smooth as possible for residents, as 

well as family members and facility 

staff. 

2. Effects on Other Providers 

This rule is expected to allow for a 

smoother transition when a facility 

closes. It requires facilities and facility 

administrators to prepare in advance for 

closure so, in the event of a closure, the 

facility is equipped to protect resident 

rights and continue to provide quality 

care to residents who must be relocated. 

This interim final rule would also 

improve coordination of care between 

the LTC facility where the residents are 

transferred from and the LTC facility 

they are transferred to. We anticipate 

that only LTC facilities would be 

affected. 

3. Effects on the Medicare and Medicaid 

Programs 

This rule would require that CMS and 

the State be notified in the case of a 

facility closure and provides them with 

the ability to make determinations 

regarding the timing of termination of 

provider agreements and continuation 

of payments to LTC facilities. This rule 

would also support efforts directed 

toward broad-based improvements in 

the quality of health care furnished by 

Medicare and Medicaid providers. 

D. Alternatives Considered 

We considered the effects of not 

addressing specific requirements for the 

notification of facility closures in LTC 

facilities, although these requirements 

are statutory and only allow limited 

discretion on the part of the Secretary. 

However, we do believe that to improve 

quality and ensure consistency in the 

provision of care in LTC facilities, it is 

important to ensure that residents rights 

are protected in LTC facilities and that 

they are relocated appropriately, taking 

into consideration the needs, choice and 

best interest of each resident should a 

facility closure take place. We expect 

that these requirements would result in 

improvement in the quality of services 

provided to LTC residents when they 

need to be involuntarily relocated. 

E. Conclusion 

This interim final rule ensures that, 

among other things, in the case of a 

facility closure, any individual who is 

the administrator of the facility provide 

written notification of the closure and 

the plan for the relocation of residents 

at least 60 days prior to the impending 

closure or, if the Secretary terminates 

the facility’s participation in Medicare 

or Medicaid, not later than the date the 

Secretary determines appropriate. 

It is consistent with the requirements 

set forth in section 6113 of the 

Affordable Care Act and the 

Administration’s efforts toward broadbased improvements in the quality of 

health care furnished by Medicare and 

Medicaid providers. 

This interim final rule clarifies the 

responsibility of the administrator of a 

facility, which is to ensure that the 

specified parties are notified of an 

impending closure in a specified 

timeframe and identifies penalties for 

non-compliance. It also clarifies the 

responsibility of the administrator of the 

facility to ensure that no new residents 

are admitted after written notice is 

submitted and that the notice of closure 

must include a plan for transfer and 

adequate relocation to another facility. 

These facilities must take into 

consideration the needs, choices and 

best interests of each resident. 

In accordance with the provisions of 

Executive Order 12866, this regulation 

was reviewed by the Office of 

Management and Budget. 

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Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 9511 

List of Subjects 

42 CFR Part 483 

Grant programs—Health, Health 

facilities, Health professions, Health 

records, Medicaid, Medicare, Nursing 

homes, Nutrition, Reporting and 

recordkeeping requirements, Safety. 

42 CFR Part 488 

Administrative practice and 

procedure, Health facilities, Medicare, 

Reporting and recordkeeping 

requirements. 

42 CFR Part 489 

Health facilities, Medicare, Reporting 

and recordkeeping requirements. 

42 CFR Part 498 

Administrative practice and 

procedure, Health facilities, Health 

professions, Medicare, Reporting and 

recordkeeping requirements. 

For the reasons set forth in the 

preamble, the Centers for Medicare & 

Medicaid Services amends 42 CFR 

Chapter IV as set forth below: 

PART 483—REQUIREMENTS FOR 

STATES AND LONG TERM CARE 

FACILITIES 

■ 1. The authority citation for part 483 

is revised to read as follows: 

Authority: Secs. 1102, 1128I and 1871 of 

the Social Security Act (42 U.S.C. 1302 and 

1395hh). 

Subpart B—Requirements for Long 

Term Care Facilities 

■ 2. Section 483.12 is amended by— 

■ A. Revising paragraph (a)(5)(i); 

■ B. Redesignating paragraph (a)(8) as 

paragraph (a)(9). 

■ C. Adding a new paragraph (a)(8). 

The revisions and additions read as 

follows: 

§ 483.12 Admission, transfer and 

discharge rights. 

(a) * * * 

(5) Timing of the notice. (i) Except as 

specified in paragraphs (a)(5)(ii) and 

(a)(8) of this section, the notice of 

transfer or discharge required under 

paragraph (a)(4) of this section must be 

made by the facility at least 30 days 

before the resident is transferred or 

discharged. 

* * * * * 

(8) Notice in advance of facility 

closure. In the case of facility closure, 

the individual who is the administrator 

of the facility must provide written 

notification prior to the impending 

closure to the Secretary, the State LTC 

ombudsman, residents of the facility, 

and the legal representatives of the 

residents or other responsible parties, as 

well as the plan for the transfer and 

adequate relocation of the residents, as 

required at § 483.75(r). 

* * * * * 

■ 3. Section 483.75 is amended by 

adding a new paragraph (r) and 

paragraph (s) to read as follows: 

§ 483.75 Administration. 

* * * * * 

(r) Facility closure-Administrator. 

Any individual who is the administrator 

of the facility must: 

(1) Submit to the Secretary, the State 

LTC ombudsman, residents of the 

facility, and the legal representatives of 

such residents or other responsible 

parties, written notification of an 

impending closure: 

(i) At least 60 days prior to the date 

of closure; or 

(ii) In the case of a facility where the 

Secretary or a State terminates the 

facility’s participation in the Medicare 

and/or Medicaid programs, not later 

than the date that the Secretary 

determines appropriate; 

(2) Ensure that the facility does not 

admit any new residents on or after the 

date on which such written notification 

is submitted; and 

(3) Include in the notice the plan for 

the transfer and adequate relocation of 

the residents of the facility by a date 

that would be specified by the State 

prior to closure, including assurances 

that the residents would be transferred 

to the most appropriate facility or other 

setting in terms of quality, services, and 

location, taking into consideration the 

needs, choice, and best interests of each 

resident. 

(s) Facility closure. The facility must 

have in place policies and procedures to 

ensure that the administrator’s duties 

and responsibilities involve providing 

the appropriate notices in the event of 

a facility closure, as required at 

paragraph (r) of this section. 

PART 488—SURVEY, CERTIFICATION, 

AND ENFORCEMENT PROCEDURES 

■ 4. The authority citation for part 488 

is revised to read as follows: 

Authority: Secs. 1102, 1128I and 1871 of 

the Social Security Act, unless otherwise 

noted (42 U.S.C. 1302 and 1395hh); Pub. L. 

110–149, 121 Stat. 1820. 

Subpart F—Enforcement of 

Compliance for Long-Term Care 

Facilities With Deficiencies 

■ 5. Section 488.426 is amended by— 

■ A. Revising paragraph (b). 

■ B. Adding a new paragraph (c). 

The revisions and additions read as 

follows: 

§ 488.426 Transfer of residents, or closure 

of the facility and transfer of residents. 

* * * * * 

(b) Required transfer when a facility’s 

provider agreement is terminated. When 

the State or CMS terminates a facility’s 

provider agreement, the State will 

arrange for the safe and orderly transfer 

of all Medicare and Medicaid residents 

to another facility, in accordance with 

§ 483.75(r) of this chapter. 

(c) Required notifications when a 

facility’s provider agreement is 

terminated. When the State or CMS 

terminates a facility’s provider 

agreement, CMS determines the 

appropriate date for notification, in 

accordance with § 483.75(r)(1)(ii) of this 

chapter. 

■ 6. Add a new § 488.446 to read as 

follows: 

§ 488.446 Administrator sanctions: longterm care facility closures. 

Any individual who is or was the 

administrator of a facility and fails or 

failed to comply with the requirements 

at § 483.75(r) of this chapter— 

(a) Will be subject to a civil monetary 

penalty as follows: 

(1) A minimum of $500 for the first 

offense. 

(2) A minimum of $1,500 for the 

second offense. 

(3) A minimum of $3,000 for the third 

and subsequent offenses. 

(b) May be subject to exclusion from 

participation in any Federal health care 

program (as defined in section 1128B(f) 

of the Act); and 

(c) Will be subject to any other 

penalties that may be prescribed by law. 

■ 7. Section 488.450 is amended by 

revising paragraph (c) to read as follows: 

§ 488.450 Continuation of payments to a 

facility with deficiencies. 

* * * * * 

(c) Period of continued payments— 

(1) Non-compliance. If the conditions in 

paragraph (a)(1) of this section are met, 

CMS may continue payments to a 

Medicare facility or the State for a 

Medicaid facility with noncompliance 

that does not constitute immediate 

jeopardy for up to 6 months from the 

last day of the survey. 

(2) Facility closure. In the case of a 

facility closure, the Secretary may, as 

the Secretary determines appropriate, 

continue to make payments with respect 

to residents of a long-term care facility 

that has submitted a notification of 

closure during the period beginning on 

the date such notification is submitted 

to CMS and ending on the date on 

which the resident is successfully 

relocated. 

* * * * * 

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9512 Federal Register / Vol. 76, No. 34 / Friday, February 18, 2011 / Rules and Regulations 

PART 489—PROVIDER AGREEMENTS 

AND SUPPLIER APPROVAL 

■ 8. The authority for part 489 is revised 

to read as follows: 

Authority: Secs. 1102, 1128I and 1819, 

1820(e), 1861, 1864(m), 1866, 1869, and 1871 

of the Social Security Act (42 U.S.C. 1302, 

1351i–3, 1395x, 1395aa(m), 1395cc, 1395ff, 

and 1395hh). 

Subpart E—Termination of Agreement 

and Reinstatement After Termination 

■ 9. Section 489.52 is amended by 

revising paragraph (a) to read as follows: 

§ 489.52 Termination by the provider. 

(a) Notice to CMS. (1) A provider that 

wishes to terminate its agreement, 

except for a SNF as specified in 

paragraph (a)(2) of this section, must 

send CMS written notice of its intention 

in accordance with paragraph (a)(3) of 

this section. 

(2) A SNF that wishes to terminate its 

agreement due to closure of the facility 

must send CMS written notice of its 

intention at least 60 days prior to the 

date of closure, as required at § 483.75(r) 

of this chapter. 

(3) The notice may state the intended 

date of termination which must be the 

first day of the month. 

* * * * * 

■ 10. Section § 489.53 is amended by— 

■ A. Revising paragraph (d)(1). 

■ B. Redesignating paragraph (d)(3) and 

paragraph (d)(4) as paragraph (d)(4) and 

paragraph (d)(5). 

■ C. Adding a new paragraph (d)(3). 

The revisions and additions read as 

follows: 

§ 489.53 Termination by CMS. 

* * * * * 

(d) Notice of termination—(1) Timing: 

basic rule. Except as provided in 

paragraphs (d)(2) and (d)(3) of this 

section, CMS gives the provider notice 

of termination at least 15 days before the 

effective date of termination of the 

provider agreement. 

* * * * * 

(3) Notice of LTC facility closure. In 

the case of a facility where CMS 

terminates a facility’s participation 

under Medicare or Medicaid in the 

absence of immediate jeopardy, CMS 

determines the appropriate date for 

notification. 

* * * * * 

■ 11. Section § 489.55 is revised to read 

as follows: 

§ 489.55 Exceptions to effective date of 

termination. 

(a) Payment is available for up to 

30 days after the effective date of 

termination for: 

(1) Inpatient hospital services 

(including inpatient psychiatric hospital 

services) and posthospital extended care 

services (except as specified in 

paragraph (b) of this section with 

respect to LTC facilities) furnished to a 

beneficiary who was admitted before the 

effective date of termination; and 

(2) Home health services and hospice 

care furnished under a plan established 

before the effective date of termination. 

(b) The Secretary may, as the 

Secretary determines is appropriate, 

continue to make payments with respect 

to residents of a long-term care facility 

that has submitted a notification of 

closure as required at § 483.75(r) of this 

chapter during the period beginning on 

the date such notification is submitted 

and ending on the date on which the 

residents are successfully relocated. 

PART 498—APPEAL PROCEDURES 

FOR DETERMINATIONS THAT AFFECT 

PARTICIPATION IN THE MEDICARE 

PROGRAM AND FOR 

DETERMINATIONS THAT AFFECT THE 

PARTICIPATION OF ICFs/MR AND 

CERTAIN NFs IN THE MEDICAID 

PROGRAM 

■ 12. The authority citation for part 498 

is revised to read as follows: 

Authority: Secs. 1102, 1128I and 1871 of 

the Social Security Act (42 U.S.C. 1302 and 

1395hh). 

Subpart A—General Provisions 

■ 13. Section 498.3 is amended by— 

■ A. Adding a new paragraph (a)(2)(iv). 

■ B. Revising paragraph (a)(3) 

introductory text and (a)(3)(ii). 

■ C. Adding a new paragraph (b)(18). 

The revisions and additions read as 

follows: 

§ 498.3 Scope and applicability. 

(a) * * * 

(2) * * * 

(iv) CMS’s determination to impose 

sanctions on the individual who is the 

administrator of a NF for failure to 

comply with the requirements at 

§ 483.75(r) of this chapter. 

(3) The following parts of this chapter 

specify the applicability of the 

provisions of this part 498 to sanctions 

or remedies imposed on the indicated 

entities or individuals: 

* * * * * 

(ii) Part 488, subpart E (§ 488.330(e)) 

and subpart F (§ 488.446)—for SNFs and 

NFs and their administrators. 

* * * * * 

(b) * * * 

(18) The level of noncompliance 

found by CMS with respect to the 

failure of an individual who is the 

administrator of a SNF to comply with 

the requirements at § 483.75(r) of this 

chapter, and the appropriate sanction to 

be imposed under § 488.446 of this 

chapter. 

* * * * * 

■ 14. Section 498.5 is amended by 

adding a new paragraph (m) to read as 

follows: 

§ 498.5 Appeal rights. 

* * * * * 

(m) Appeal rights of an individual 

who is the administrator of a SNF. An 

individual who is the administrator of a 

SNF who is dissatisfied with the 

decision of CMS to impose sanctions 

authorized under § 488.446 of this 

chapter is entitled to a hearing before an 

ALJ, to request Board review of the 

hearing decision, and to seek judicial 

review of the Board’s decision. 

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplementary Medical 

Insurance Program) 

Dated: November 18, 2010. 

Donald M. Berwick, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: February 15, 2011. 

Kathleen Sebelius, 

Secretary. 

[FR Doc. 2011–3806 Filed 2–17–11; 8:45 am] 

BILLING CODE 4120–01–P 

WReier-Aviles on DSKGBLS3C1PROD with RULES