9466 Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 

ADDENDUM F.—REVISED SINGLE DRUG CATEGORY LIST—Continued 

HCPCS Long description Weight 

J9390 ........................................................ Vinorelbine tartrate, per 10 mg .................................................................................... 0.00111035 

J9395 ........................................................ Injection, fulvestrant, 25 mg ......................................................................................... 0.00126670 

J9600 ........................................................ Porfimer sodium, 75 mg ............................................................................................... 0.00000030 

Q3025 ....................................................... Injection, interferon BETA–1A, 11 mcg for intramuscular use .................................... 0.00078263 

IV. 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 the notice and comment 

procedures 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 rule. We can also waive the 30-day 

delay in effective date under the APA (5 

U.S.C. 553(d)) when there is good cause 

to do so and we publish in the rule an 

explanation of our good cause. 

This correcting amendment addresses 

technical errors and omissions made in 

FR Doc. 05–22160, entitled ‘‘Medicare 

Program; Revisions to Payment Policies 

Under the Physician Fee Schedule for 

Calendar Year 2006 and Certain 

Provisions Related to the Competitive 

Acquisition Program of Outpatient 

Drugs and Biologicals Under Part B,’’

which appeared in the Federal Register 

on November 21, 2005 (70 FR 70116) 

and was made effective January 1, 2006. 

The provisions of this final rule with 

comment period have been previously 

subjected to notice and comment 

procedures. These corrections are 

consistent with the discussion and text 

and do not make substantive changes to 

the CY 2006 published rule. As such, 

this correcting amendment is intended 

to ensure the CY 2006 final rule with 

comment accurately reflects the policy 

adopted. Therefore, we find that 

undertaking further notice and comment 

procedures to incorporate these 

corrections into the final rule with 

comment 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 2006 final rule 

with comment accurately states our 

policy on physician fee schedule and 

other Part B payment policies, and 

provisions related to the competitive 

acquisition program of outpatient drugs 

and biologicals under Part B. Therefore, 

delaying the effective date of these 

corrections beyond the January 1, 2006 

effective date of the final rule with 

comment period would be contrary to 

the public interest. In so doing, we find 

good cause to waive the 30-day delay in 

the effective date. 

(Catalog of Federal Domestic Assistance 

Program No. 93.774, Medicare—

Supplementary Medical Insurance Program) 

Dated: February 7, 2006. 

Ann C. Agnew, 

Executive Secretary to the Department. 

[FR Doc. 06–1711 Filed 2–23–06; 8:45 am] 

BILLING CODE 4120–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Parts 411 and 489 

[CMS–6272–IFC] 

RIN 0938–AN27 

Medicare Program; Medicare 

Secondary Payer Amendments 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Interim final rule with comment 

period. 

SUMMARY: This interim final rule with 

comment period implements 

amendments to the Medicare Secondary 

Payer (MSP) provisions under Title III of 

the Medicare Prescription Drug, 

Improvement, and Modernization Act of 

2003 (MMA). The MMA amendments 

clarify the MSP provisions regarding the 

obligations of primary plans and 

primary payers, the nature of the 

insurance arrangements subject to the 

MSP rules, the circumstances under 

which Medicare may make conditional 

payments, and the obligations of 

primary payers to reimburse Medicare. 

DATES: Effective date: These regulations 

are effective on April 25, 2006. 

Comment date: To be assured 

consideration, comments must be 

received at one of the addresses 

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

April 25, 2006. 

ADDRESSES: In commenting, please refer 

to file code CMS–6272–IFC. Because of 

staff and resource limitations, we cannot 

accept comments by facsimile (FAX) 

transmission. 

You may submit comments in one of 

four ways (no duplicates, please): 

1. Electronically. You may submit 

electronic comments on specific issues 

in this regulation to http:// 

www.cms.hhs.gov/eRulemaking. Click 

on the link ‘‘Submit electronic 

comments on CMS regulations with an 

open comment period.’’ (Attachments 

should be in Microsoft Word, 

WordPerfect, or Excel; however, we 

prefer Microsoft Word.) 

2. By regular mail. You may mail 

written comments (one original and two 

copies) to the following address ONLY: 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Attention: CMS–6272–

IFC, g1P.O. Box 8017, Baltimore, MD 

21244–8017. 

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 (one 

original and two copies) to the following 

address ONLY: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–6272–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 (one original 

and two copies) before the close of the 

comment period to one of the following 

addresses. If you intend to deliver your 

comments to the Baltimore address, 

please call telephone number (410) 786–

7195 in advance to schedule your 

arrival with one of our staff members. 

Room 445–G, Hubert H. Humphrey 

Building, 200 Independence Avenue, 

SW., Washington, DC 20201; or 7500 

Security Boulevard, Baltimore, MD 

21244–1850. 

(Because access to the interior of the 

HHH Building is not readily available to 

persons without Federal Government 

identification, commenters are 

encouraged to leave their comments in 


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Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 9467 

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.) 

Comments mailed to the addresses 

indicated as appropriate for hand or 

courier delivery may be delayed and 

received after the comment period. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: 

Suzanne Ripley, (410) 786–0970. 

SUPPLEMENTARY INFORMATION: 

Submitting Comments: We welcome 

comments from the public on all issues 

set forth in this rule to assist us in fully 

considering issues and developing 

policies. You can assist us by 

referencing the file code CMS–6272–IFC 

and the specific ‘‘issue identifier’’ that 

precedes the section on which you 

choose to comment. 

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.cms.hhs.gov/ 

eRulemaking. Click on the link 

‘‘Electronic Comments on CMS 

Regulations’’ on that Web site to view 

public comments. 

Comments received timely will be 

also 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. Background 

[If you choose to comment on issues 

in this section, please indicate the 

caption ‘‘Background’’ at the beginning 

of your comment.] 

Beginning in 1980, the Congress 

enacted a series of amendments to 

section 1862(b) of the Social Security 

Act (the Act) (hereafter referred to as the 

Medicare Secondary Payer (MSP) 

provisions) to protect the financial 

integrity of the Medicare program by 

making Medicare a secondary payer, 

rather than a primary payer of health 

care services, when certain types of 

other health care coverage are available. 

(Workers’ compensation had already 

been primary to Medicare since the 

implementation of the original Medicare 

statute.) In enacting the MSP provisions, 

the Congress intended that the MSP 

provisions be construed to make 

Medicare a secondary payer to the 

maximum extent possible. These 

statutory provisions are set forth in 

regulations at 42 CFR part 411, 

Exclusions From Medicare and 

Limitations on Medicare Payment. 

II. MMA Amendments to the Medicare 

Secondary Payer (MSP) Provisions 

[If you choose to comment on issues 

in this section, please indicate the 

caption ‘‘MMA Amendments to the 

Medicare Secondary Payer Provisions’’

at the beginning of your comment.] 

The Congress later became aware that 

various parties were pressing several 

interpretations of the MSP provisions 

that would, if ultimately accepted, 

severely limit the applicability of the 

MSP provisions at considerable expense 

to the Medicare program. Many of these 

interpretations were presented in the 

context of Federal court litigation over 

the meaning of various MSP provisions. 

The Congress rejected these attempts to 

incorrectly limit the application and 

scope of the MSP statute. The Congress 

passed section 301 under Title III of the 

Medicare Prescription Drug, 

Improvement, and Modernization Act of 

2003 (MMA) (Pub. L. 108–173) on 

December 8, 2003 to clarify its original 

intent regarding the MSP provisions 

under section 1862(b) of the Act, 

thereby indicating that these 

interpretations were incorrect and that 

the Secretary’s interpretations were 

accurate. These clarifications are 

effective as if enacted on the date of the 

original legislation. 

Section 301(a) of the MMA amends 

section 1862(b)(2)(A)(ii) of the Act to 

remove the term ‘‘promptly.’’ This 

amendment establishes that various 

parties were incorrect in their 

interpretation that section 

1862(b)(2)(A)(ii) of the Act applied only 

if the workers’ compensation law or 

plan, liability insurance, or no-fault 

insurance has paid or could reasonably 

be expected to pay for services 

‘‘promptly.’’ This amendment also adds 

language at section 1862(b)(2)(B) of the 

Act to clarify that the Secretary may 

make payment subject to reimbursement 

if the workers’ compensation law or 

plan, liability insurance, or no-fault 

insurance has not paid or could not 

reasonably be expected to pay for 

services ‘‘promptly.’’

Section 301(b)(1) of the MMA amends 

section 1862(b)(2)(A) of the Act to 

clarify the application of the term ‘‘selfinsured plan.’’ It establishes that ‘‘an 

entity that engages in a business, trade, 

or profession shall be deemed to have a 

self-insured plan if it carries its own risk 

(whether by a failure to obtain 

insurance, or otherwise) in whole or in 

part.’’

Section 301(b)(2)(A) of the MMA 

amends section 1862(b)(2)(B) of the Act 

to specify that a primary plan, and an 

entity that receives payment from a 

primary plan, shall reimburse the 

appropriate Trust Fund for any payment 

that the Secretary makes with respect to 

an item or service if it is demonstrated 

that the primary plan has or had a 

responsibility to make payment with 

respect to the item or service. It adds 

language establishing that a primary 

plan’s responsibility for this payment 

‘‘may be demonstrated by a judgment, a 

payment conditioned upon the 

recipient’s compromise, waiver, or 

release (whether or not there is a 

determination or admission of liability) 

of payment for items or services 

included in a claim against the primary 

plan or the primary plan’s insured, or by 

other means.’’

Section 301(b)(3) of the MMA amends 

section 1862(b)(2) of the Act to further 

delineate those entities (that is, 

‘‘primary payers’’) from which the 

United States may seek reimbursement. 

It amends language specifying that the 

United States may bring an action 

against ‘‘all entities that are or were 

required or responsible (directly, as an 

insurer or self-insurer, as a third-party 

administrator, as an employer that 

sponsors or contributes to a group 

health plan, or large group health plan, 

or otherwise) to make payment with 

respect to the same item or service (or 

any portion thereof) under a primary 

plan.’’ This amendment specifies that 

the United States may recover double 

damages against these entities. Also, it 

amends language clarifying that the 

United States may recover payment 

from ‘‘any entity that has received 

payment from a primary plan or from 

the proceeds of a primary plan’s 

payment to any entity.’’

Under section 301(d) of the MMA, 

these provisions are effective as if 

enacted on the date of the original 

legislation to reflect the original MSP 

provisions and Congressional intent at 

issue. As we discuss in more detail 

below, this interim final rule with 

comment period amends 42 CFR part 

411 and § 489.20(i)(2)(ii) of our 

regulations to implement these MSP 

provisions. 


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9468 Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 

III. Provisions of This Interim Final 

Rule With Comment Period 

[If you choose to comment on issues 

in this section, please indicate the 

caption ‘‘Provisions of This Interim 

Final Rule with Comment Period’’ at the 

beginning of your comment.] 

As is the case with group health plan 

and large group health plan insurance, 

Medicare may not make payment if 

payment with respect to the same item 

or service has been made or can 

reasonably be expected to be made 

under workers’ compensation, no-fault, 

or liability insurance. However, 

Medicare may make a payment 

conditioned on reimbursement when 

the workers’ compensation, no-fault, or 

liability insurance (including a selfinsured plan) plan has not made or 

cannot reasonably be expected to make 

payment with respect to such item or 

service promptly. In accordance with 

section 301(a) of the MMA, we are 

removing the word ‘‘promptly’’ from 

§ 411.20(a)(2), § 411.40(b)(1)(i), and 

§ 411.50(c)(1) and (c)(2) to clarify that 

these Medicare payments are 

conditional and must be reimbursed 

whenever a primary payer’s 

responsibility to make payment is 

demonstrated. 

At § 411.21, we are removing the 

definitions for ‘‘third party payer’’ and 

‘‘third party payment’’ and replacing 

them with definitions for ‘‘primary 

payer’’ and ‘‘primary payment.’’ We are 

also providing a definition for ‘‘primary 

plan.’’ We are making these changes to 

conform to the statutory language under 

the MMA. Consistent with these 

changes, we are making nomenclature 

changes to replace the terms ‘‘third 

party payer,’’ ‘‘third party payment,’’

and ‘‘third party plan’’ with ‘‘primary 

payer,’’ ‘‘primary payment,’’ or 

‘‘primary plan,’’ respectively under part 

411 throughout subparts B through H. 

At § 411.33(f)(4), we are replacing the 

term ‘‘third party’’ with ‘‘primary 

payer.’’ We are also amending 

§ 489.20(i)(2)(ii) to replace ‘‘third party 

payment’’ with ‘‘primary payment.’’

In this interim final rule with 

comment period, we are also adding 

language to the definition of ‘‘selfinsured’’ plan in § 411.50(b) in 

accordance with section 301(b)(1) of the 

MMA. We are clarifying that an entity 

that engages in a business, trade, or 

profession is deemed to have a ‘‘selfinsured’’ plan for liability insurance if it 

carries its own risk, in whole or in part. 

Any such entity’s self-insured status 

may be demonstrated, among other 

ways, by the failure to obtain insurance. 

In accordance with section 

301(b)(2)(A) of the MMA, we are adding 

a new § 411.22 to clarify that a primary 

payer, and an entity that receives 

payment from a primary payer, become 

obligated to reimburse CMS if and when 

it is demonstrated that the primary 

payer has or had primary payment 

responsibility. This responsibility may 

be demonstrated by a judgment, a 

payment conditioned upon the 

recipient’s compromise, waiver, or 

release (whether or not there is a 

determination or admission of liability) 

of payment for items and services 

included in a claim against the primary 

payer, or by other means, including but 

not limited to a settlement, award, or 

contractual obligation. This means that 

a primary payer may not extinguish its 

obligations under the MSP provisions 

by paying the wrong party—for 

example, by paying the Medicare 

beneficiary or the provider when it 

should have reimbursed the Medicare 

program. Primary payers are expected to 

reimburse CMS when it is demonstrated 

that they have or had payment 

responsibility. 

In accordance with section 301(b)(3) 

of the MMA, the definition of ‘‘primary 

payer’’ in § 411.21, the new § 411.22, 

and the revised § 411.24(e) also clarify 

that the Medicare program may seek 

reimbursement from a primary payer, or 

any or all the entities responsible or 

required to make payment as a primary 

payer. With respect to debts where a 

group health plan or large group health 

plan is the primary plan, the 

amendments make clear that all 

employers that sponsor or contribute to 

the group health plan or large group 

health plan are primary payers required 

to reimburse Medicare regardless of 

whether the group health plan or large 

group health plan was an insured plan 

(that is, the employer or other plan 

sponsor purchased insurance) or was 

self-insured by the employer or other 

plan sponsor. Medicare may also seek 

reimbursement from any entity that has 

received payment from a primary payer. 

Entities that receive payment include, 

but are not limited to beneficiaries, 

attorneys, and providers or suppliers 

(including physicians). 

Furthermore, in this interim final rule 

with comment period, we are revising 

§ 411.24(e) by adding language 

pertaining to Medicare’s authority to 

recover conditional payments. 

Specifically, in accordance with section 

301(b)(3) of the MMA, we specify at 

§ 411.24(e) that CMS has a direct right 

of action to recover from any primary 

payer. We are making a technical 

revision at § 411.24(f)(2) to replace the 

words ‘‘is primary’’ with ‘‘is a primary 

plan.’’

Consistent with section 301(b)(2)(A) 

of the MMA, this interim rule with 

comment period clarifies at 

§ 411.24(i)(1) that, like liability 

insurance and disputed claims under 

group health plans and no-fault 

insurance, workers’ compensation 

insurance and plans must also 

reimburse Medicare, although it paid 

some other entity, if it knew or should 

have known that the claimant was a 

Medicare beneficiary. Where Medicare 

has already recovered payment from the 

entity, reimbursement to Medicare by 

the workers’ compensation insurance or 

plan is not required. However, nothing 

in this interim final rule with comment 

period will be construed to require us to 

first pursue the entity which receives 

payment before it can pursue the 

primary payer. Also consistent with 

section 301(b)(2)(A) of the MMA, we are 

adding language to § 411.45, § 411.52, 

and § 411.53 to specify that any 

conditional payment that Medicare 

makes is based upon the recovery rules 

under subpart B of part 411. In addition, 

at § 411.52, we clarify the basis for 

which Medicare makes payment in 

liability cases. We are revising § 411.53 

by removing the terms ‘‘, or the provider 

or supplier,’’ in the existing paragraph 

(a) to clarify that it is the beneficiary’s 

responsibility to file a claim for no-fault 

benefits. 

III. 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. 

IV. Waiver of Proposed Rulemaking 

We ordinarily publish a notice of 

proposed rulemaking in the Federal 

Register and invite public comment on 

the proposed rule. 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 proposed 

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. 

We find it unnecessary to undertake 

notice and comment rulemaking 


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Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 9469 

because this interim final rule with 

comment period merely conforms part 

411 and § 489.20(i)(2)(ii) of the 

regulations to statutory changes affected 

by section 301 of the MMA. 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. 

V. Collection of Information 

Requirements 

This document does not impose 

information collection and 

recordkeeping requirements. 

Consequently, it need not be reviewed 

by the Office of Management and 

Budget under the authority of the 

Paperwork Reduction Act of 1995. 

VI. Regulatory Impact Statement 

[If you choose to comment on issues 

in this section, please indicate the 

caption ‘‘Regulatory Impact’’ at the 

beginning of your comment.] 

We have examined the impacts of this 

interim final rule with comment period 

as required by Executive Order 12866 

(September 1993, Regulatory Planning 

and Review), 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 (Pub. L. 104–4), and 

Executive Order 13132. 

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). We have determined that 

the effect of this interim final rule with 

comment period on the economy and 

the Medicare program is not 

economically significant, since it merely 

clarifies certain MSP provisions to 

reflect original congressional intent and 

ratifies the manner in which we have 

implemented/administered the MSP 

provisions. If the technical and 

clarifying amendments had not been 

enacted, ‘‘savings’’ reflected in the table 

below would have been lost and 

Medicare expenditures would have 

increased. 

The table reflects the potential impact 

of a Fifth Circuit Court decision that 

held that the MSP liability provision did 

not apply when there was no liability 

insurance purchased or no formal plan 

of self-insurance recognized under the 

Internal Revenue Code. This placed a 

small portion of future MSP liability 

savings at risk. It was assumed that over 

time, some U.S. Circuit Courts could 

have reached a similar conclusion so 

that the potential losses of future MSP 

liability savings would increase slowly 

over time in addition to the projected 

growth of Medicare benefits. It was 

further assumed that some individuals 

who repaid Medicare before 2003 would 

sue for refunds and that favorable 

decisions would be rendered in some, 

but not all, cases. It was also assumed 

that the refunds of past MSP liability 

savings would peak about 2007. Lastly, 

it was assumed that MSP liability 

collections represent approximately 70 

percent Part A claims payments and 30 

percent Part B claims payments (which 

are based on historic MSP liability 

savings). 

MEDICARE SAVINGS RETAINED

[ROUNDED TO THE NEAREST $10 

MILLION] 

Part A Part B Total 

2003 ............ 0 0 0 

2004 ............ 10 0 10 

2005 ............ 10 0 10 

2006 ............ 10 0 10 

2007 ............ 20 0 20 

2008 ............ 10 0 10 

2009 ............ 20 0 20 

2010 ............ 20 10 30 

2011 ............ 20 10 30 

2012 ............ 20 10 30 

2013 ............ 20 10 30 

2014 ............ 20 10 30 

2015 ............ 20 10 30 

Therefore, this interim final rule with 

comment period is not a major rule as 

defined in Title 5, United States Code, 

section 804(2) and is not an 

economically significant rule under 

Executive Order 12866. 

The RFA requires agencies to analyze 

options for regulatory relief of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdictions. Most 

hospitals and most other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues 

of $6 million to $29 million in any 1 

year. Individuals and States are not 

included in the definition of a small 

entity. We have determined and we 

certify that this interim final rule with 

comment period will not have a 

significant economic impact on a 

substantial number of small entities 

because there is and will be no change 

in the administration of the MSP 

provisions. Therefore, we are not 

preparing an analysis for the RFA. 

In addition, section 1102(b) of the Act 

requires us to prepare a regulatory 

impact analysis if a rule or notice 

having the effect of 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 purposes of section 1102(b) of 

the Act, we define a small rural hospital 

as a hospital that is located outside of 

a Core-Based Statistical Area and has 

fewer than 100 beds. We have 

determined that this interim final rule 

with comment period will not have a 

significant effect on the operations of a 

substantial number of small rural 

hospitals because there is and will be no 

change in the administration of the MSP 

provisions. Therefore, we are not 

preparing an analysis for section 1102(b) 

of the Act. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule or notice having the effect of a rule 

whose mandates require spending in 

any 1 year of $100 million in 1995 

dollars, updated annually for inflation. 

That threshold level is currently 

approximately $120 million. This 

interim final rule with comment period 

has no consequential effect on State, 

local, or tribal governments or on the 

private sector because there is and will 

be no change in the administration of 

the MSP provisions. 

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. 

Since this regulation does not impose 

any costs on State or local governments, 

the requirements of E.O. 13132 are not 

applicable. 

In accordance with the provisions of 

Executive Order 12866, this regulation 

was reviewed by the Office of 

Management and Budget. 

List of Subjects 

42 CFR Part 411 

Kidney diseases, Medicare, Reporting 

and recordkeeping requirements. 

42 CFR Part 489 

Health facilities, 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: 


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9470 Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 

PART 411—EXCLUSIONS FROM 

MEDICARE AND LIMITATIONS ON 

MEDICARE PAYMENT 

■ 1. The authority citation for part 411 

continues to read as follows: 

Authority: Secs. 1102 and 1871 of the 

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

1395hh). 

§ 411.20 [Amended] 

■ 2. Section 411.20 is amended by 

removing the word ‘‘promptly’’ in 

paragraph (a)(2) introductory text. 

■ 3. Section 411.21 is amended by 

adding definitions of ‘‘primary payer,’’

‘‘primary payment,’’ and ‘‘primary 

plan’’ and removing the definitions of 

‘‘third party payer’’ and ‘‘third party 

payment’’ to read as follows: 

§ 411.21 Definitions. 

* * * * * 

Primary payer means, when used in 

the context in which Medicare is the 

secondary payer, any entity that is or 

was required or responsible to make 

payment with respect to an item or 

service (or any portion thereof) under a 

primary plan. These entities include, 

but are not limited to, insurers or selfinsurers, third party administrators, and 

all employers that sponsor or contribute 

to group health plans or large group 

health plans. 

Primary payment means, when used 

in the context in which Medicare is the 

secondary payer, payment by a primary 

payer for services that are also covered 

under Medicare. 

Primary plan means, when used in 

the context in which Medicare is the 

secondary payer, a group health plan or 

large group health plan, a workers’

compensation law or plan, an 

automobile or liability insurance policy 

or plan (including a self-insured plan), 

or no-fault insurance. 

* * * * * 

■ 4. A new § 411.22 is added to read as 

follows: 

§ 411.22 Reimbursement obligations of 

primary payers and entities that received 

payment from primary payers. 

(a) A primary payer, and an entity that 

receives payment from a primary payer, 

must reimburse CMS for any payment if 

it is demonstrated that the primary 

payer has or had a responsibility to 

make payment. 

(b) A primary payer’s responsibility 

for payment may be demonstrated by—

(1) A judgment; 

(2) A payment conditioned upon the 

recipient’s compromise, waiver, or 

release (whether or not there is a 

determination or admission of liability) 

of payment for items or services 

included in a claim against the primary 

payer or the primary payer’s insured; or 

(3) By other means, including but not 

limited to a settlement, award, or 

contractual obligation. 

§ 411.24 [Amended] 

■ 5. Section 411.24 is amended by—

■ A. Revising paragraph (e). 

■ B. Removing the words ‘‘is primary’’

and adding in its place the phrase ‘‘is a 

primary plan’’ in paragraph (f)(2). 

■ C. Adding ’’, workers’ compensation 

insurance or plan,’’ after ‘‘group health 

plans’’ and before ‘‘and’’ in paragraph 

(i)(1). 

Revisions for paragraph (e) read as 

follows: 

§ 411.24 Recovery of conditional 

payments. 

* * * * * 

(e) Recovery from primary payers. 

CMS has a direct right of action to 

recover from any primary payer. 

* * * * * 

■ 6. Section 411.33(f)(4) introductory 

text is revised to read as follows: 

§ 411.33 Amount of Medicare secondary 

payment. 

* * * * * 

(f) Examples: * * * 

(4) A hospital furnished 5 days of 

inpatient care in 1987 to a Medicare 

beneficiary. The provider’s charges for 

Medicare-covered services were $4,000 

and the gross amount payable was 

$3,500. The provider agreed to accept 

$3,000 from the primary payer as 

payment in full. The primary payer paid 

$2,900 due to a deductible requirement 

under the primary plan. Medicare 

considers the amount the provider is 

obligated to accept as full payment 

($3,000) to be the provider charges. The 

Medicare secondary payment is the 

lowest of the following: 

* * * * * 

§ 411.40 [Amended] 

■ 7. Section 411.40 is amended by 

removing the word ‘‘promptly’’ in 

paragraph (b)(1)(i). 

■ 8. Section 411.45 is revised to read as 

follows: 

§ 411.45 Basis for conditional Medicare 

payment in workers’ compensation cases. 

(a) A conditional Medicare payment 

may be made under either of the 

following circumstances: 

(1) The beneficiary has filed a proper 

claim for workers’ compensation 

benefits, but the intermediary or carrier 

determines that the workers’

compensation carrier will not pay 

promptly. This includes cases in which 

a workers’ compensation carrier has 

denied a claim. 

(2) The beneficiary, because of 

physical or mental capacity, failed to 

file a proper claim. 

(b) Any conditional payment that 

CMS makes is conditioned on 

reimbursement to CMS in accordance 

with subpart B of this part. 

§ 411.50 [Amended] 

■ 9. Section 411.50 is amended by—

■ A. Revising the definition of ‘‘selfinsured plan’’ in paragraph (b). 

■ B. Removing the word ‘‘promptly’’ in 

paragraphs (c)(1) and (c)(2). 

■ The revision reads as follows: 

§ 411.50 General provisions. 

* * * * * 

(b) Definitions. 

* * * * * 

Self-insured plan means a plan under 

which an individual, or a private or 

governmental entity, carries its own risk 

instead of taking out insurance with a 

carrier. This term includes a plan of an 

individual or other entity engaged in a 

business, trade, or profession, a plan of 

a non-profit organization such as a 

social, fraternal, labor, educational, 

religious, or professional organization, 

and the plan established by the Federal 

government to pay liability claims 

under the Federal Tort Claims Act. An 

entity that engages in a business, trade, 

or profession is deemed to have a selfinsured plan for purposes of liability 

insurance if it carries its own risk 

(whether by a failure to obtain 

insurance, or otherwise) in whole or in 

part. 

* * * * * 

■ 10. Section 411.52 is revised to read 

as follows: 

§ 411.52 Basis for conditional Medicare 

payment in liability cases. 

(a) A conditional Medicare payment 

may be made in liability cases under 

either of the following circumstances: 

(1) The beneficiary has filed a proper 

claim for liability insurance benefits but 

the intermediary or carrier determines 

that the liability insurer will not pay 

promptly for any reason other than the 

circumstances described in 

§ 411.32(a)(1). This includes cases in 

which the liability insurance carrier has 

denied the claim. 

(2) The beneficiary has not filed a 

claim for liability insurance benefits. 

(b) Any conditional payment that 

CMS makes is conditioned on 

reimbursement to CMS in accordance 

with subpart B of this part. 

■ 11. Section 411.53 is revised to read 

as follows: 


wwhite on PROD1PC61 with RULES
Federal Register / Vol. 71, No. 37 / Friday, February 24, 2006 / Rules and Regulations 9471 

§ 411.53 Basis for conditional Medicare 

payment in no-fault cases. 

(a) A conditional Medicare payment 

may be made in no-fault cases under 

either of the following circumstances: 

(1) The beneficiary has filed a proper 

claim for no-fault insurance benefits but 

the intermediary or carrier determines 

that the no-fault insurer will not pay 

promptly for any reason other than the 

circumstances described in 

§ 411.32(a)(1). This includes cases in 

which the no-fault insurance carrier has 

denied the claim. 

(2) The beneficiary, because of 

physical or mental incapacity, failed to 

meet a claim-filing requirement 

stipulated in the policy. 

(b) Any conditional payment that 

CMS makes is conditioned on 

reimbursement to CMS in accordance 

with subpart B of this part. 

PART 411—[NOMENCLATURE 

CHANGE] 

■ 12. In part 411, revise all references to 

‘‘third party payer’’ to read ‘‘primary 

payer’; revise all references to ‘‘third 

party payment’’ to read ‘‘primary 

payment’; and revise all references to 

‘‘third party plan’’ to read ‘‘primary 

plan’’. 

PART 489—PROVIDER AGREEMENTS 

AND SUPPLIER APPROVAL 

■ 1. The authority citation for part 489 

continues to read as follows: 

Authority: Secs. 1102 and 1871 of the 

Social Security Act. 

§ 489.20 [Amended] 

■ 2. Section § 489.20(i)(2)(ii) 

introductory text is amended by 

removing the words ‘‘third party 

payment’’ and adding in its place the 

words ‘‘primary payment’’. 

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplementary Medical 

Insurance Program) 

Dated: February 8, 2006. 

Mark B. McClellan, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: November 14, 2005. 

Michael O. Leavitt, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 06–1712 Filed 2–23–06; 8:45 am] 

BILLING CODE 4120–01–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 648 

[Docket No. 051128313–6029–02; I.D. 

111705C] 

RIN 0648–AT20 

Fisheries of the Northeastern United 

States; Atlantic Bluefish Fisheries; 

2006 Atlantic Bluefish Specifications; 

Quota Adjustment; 2006 Research SetAside Project 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Final rule; final specifications 

for the 2006 Atlantic bluefish fishery. 

SUMMARY: NMFS issues 2006 

specifications for the Atlantic bluefish 

fishery, including state-by-state 

commercial quotas, a recreational 

harvest limit, and recreational 

possession limits for Atlantic bluefish 

off the east coast of the United States. 

The intent of these specifications is to 

establish the allowable 2006 harvest 

levels and possession limits to attain the 

target fishing mortality rate (F), 

consistent with the stock rebuilding 

program in Amendment 1 to the 

Atlantic Bluefish Fishery Management 

Plan (FMP). This action will publish 

final specifications that are modified 

from those contained in the proposed 

rule. 

DATES: This rule is effective March 27, 

2006, through December 31, 2006. 

ADDRESSES: Copies of the specifications 

document, including the Environmental 

Assessment (EA) and the Initial 

Regulatory Flexibility Analysis (IRFA) 

are available from Daniel Furlong, 

Executive Director, Mid-Atlantic 

Fishery Management Council, Room 

2115, Federal Building, 300 South 

Street, Dover, DE 19901 6790. The 

specifications document is also 

accessible via the Internet at http:// 

www.nero.nmfs.gov. 

The Final Regulatory Flexibility 

Analysis (FRFA) consists of the IRFA, 

public comments and responses 

contained in this final rule, and a 

summary of impacts and alternatives 

contained in this final rule. 

The small entity compliance guide is 

available from Patricia A. Kurkul, 

Regional Administrator, Northeast 

Regional Office, National Marine 

Fisheries Service, One Blackburn Drive, 

Gloucester, MA 01930 2298. 

The Northeast Fisheries Science 

Center 41st Stock Assessment Review 

Committee (SARC) Panelist Reports are 

available at: http://www.nefsc.noaa.gov/ 

nefsc/saw/saw41/. 

FOR FURTHER INFORMATION CONTACT: 

Bonnie Van Pelt, Fishery Policy 

Analyst, (978) 281–9244. 

SUPPLEMENTARY INFORMATION: 

Background 

The regulations implementing the 

Atlantic Bluefish Fishery Management 

Plan (FMP) appear at 50 CFR part 648, 

subparts A and J. Regulations requiring 

annual specifications are found at 50 

CFR 648.160. The management unit for 

bluefish (Pomatomus saltatrix) is U.S. 

waters of the western Atlantic Ocean. 

The FMP requires that the MidAtlantic Fishery Management Council 

(Council) recommend, on an annual 

basis, total allowable landings (TAL) for 

the fishery, consisting of a commercial 

quota and recreational harvest limit. 

The annual review process for 

bluefish requires that the Council’s 

Bluefish Monitoring Committee 

(Monitoring Committee) review and 

make recommendations based on the 

best available data including, but not 

limited to, commercial and recreational 

catch/landing statistics, current 

estimates of fishing mortality, stock 

abundance, discards for the recreational 

fishery, and juvenile recruitment. Based 

on the recommendations of the 

Monitoring Committee, the Council 

makes a recommendation to NMFS. 

This FMP is a joint plan with the 

Atlantic States Marine Fisheries 

Commission (Commission); therefore, 

the Commission meets during the 

annual specification process to adopt 

complementary measures. 

The Council’s recommendations must 

include supporting documentation 

concerning the environmental, 

economic, and social impacts of the 

recommendations. NMFS is responsible 

for reviewing these recommendations to 

ensure they achieve the FMP objectives, 

and may modify them if they do not. 

NMFS then publishes proposed 

specifications in the Federal Register. 

After considering public comment, 

NMFS publishes final specifications in 

the Federal Register. 

In July 2005, the Monitoring 

Committee accepted the most recent 

bluefish stock assessment as the basis 

for its specification recommendations to 

the Council. In August 2005, the 

Council approved the Monitoring 

Committee’s recommendations and the 

Commission’s Bluefish Board (Board) 

adopted complementary management 

measures. 


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