24666 Federal Register / Vol. 65, No. 82 / Thursday, April 27, 2000 / Proposed Rules

Risks. This rule is not an economically

significant rule and does not concern an

environmental risk to health or risk to

safety that may disproportionately affect

children.

Environment

We considered the environmental

impact of this proposed rule and

concluded that, under figure 2–1,

paragraph (32)(e), of Commandant

Instruction M16475.1C, this proposed

rule is categorically excluded from

further environmental documentation

because promulgation of drawbridge

regulations have been found not to have

a significant effect on the environment.

A ‘‘Categorical Exclusion

Determination’’ is available in the

docket where indicated under

ADDRESSES.

List of Subjects in 33 CFR Part 117

Bridges.

Regulations

For the reasons set out in the

preamble, the Coast Guard proposes to

amend 33 CFR part 117 as follows:

PART 117—DRAWBRIDGE

OPERATION REGULATIONS

1. The authority citation for part 117

continues to read as follows:

Authority: 33 U.S.C. 499; 49 CFR 1.46; 33

CFR 1.05–1(g); section 117.255 also issued

under the authority of Pub. L. 102–587, 106

Stat. 5039.

2. Section 117.787 is revised to read

as follows:

§ 117.787 Gowanus Canal.

The draws of the Ninth Street Bridge,

mile 1.4, the Third Street Bridge, mile

1.8, the Carroll Street Bridge, mile 2.0,

and the Union Street Bridge, mile 2.1,

at Brooklyn, shall open on signal if at

least a two-hour advance notice is given

to either the New York City Department

of Transportation (NYCDOT) Radio

Hotline or the NYCDOT Bridge

Operations Office.

Dated: April 12, 2000.

Robert F. Duncan,

Captain, U.S. Coast Guard, Acting

Commander, First Coast Guard District.

[FR Doc. 00–10454 Filed 4–26–00; 8:45 am]

BILLING CODE 4910–15–M

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Health Care Financing Administration

42 CFR Part 414

HCFA–1084–P

RIN 0938–AJ82

Medicare Program; Payment for

Upgraded Durable Medical Equipment

AGENCY: Health Care Financing

Administration (HCFA), HHS.

ACTION: Proposed rule.

SUMMARY: This proposed rule would

amend the Medicare regulations to

permit Medicare suppliers to furnish

upgraded durable medical equipment

(DME) on an assignment basis. Medicare

payment would be made to the supplier

as if the DME were non-upgraded DME;

and the beneficiary purchasing or

renting the upgraded DME would pay

the supplier an amount equal to the

difference between the supplier’s charge

for the DME upgrade and the amount

paid by Medicare for the non-upgraded

DME. This proposed rule would also

require the following consumer

protection safeguards: determination of

fair market prices, proof of full

disclosure of the availability and cost of

non-upgraded DME, and sanctions

against suppliers who engage in

coercive or abusive sales practices.

DATES: We will consider comments if

we receive them at the appropriate

address, as provided below, no later

than 5 p.m. on June 26, 2000.

ADDRESSES: Mail written comments (1

original and 3 copies) to the following

address only: Health Care Financing

Administration, Department of Health

and Human Services, Attention: HCFA–

1084–P, P.O. Box 8013, Baltimore, MD

21244–8013.

If you prefer, you may deliver your

written comments (1 original and 3

copies) to one of the following addresses

(If you choose to mail your comments to

one of the following addresses, we may

be delayed receiving them, which could

result in us considering those comments

late.):

Room 443–G, Hubert H. Humphrey

Building, 200 Independence Avenue,

SW., Washington, DC, or

Room C5–16–03, 7500 Security

Boulevard, Baltimore, MD

Because of staffing and resource

limitations, we cannot accept comments

by facsimile (FAX) transmission. In

commenting, please refer to file code

HCFA–1084–P. Comments received

timely will be available for public

inspection as they are received,

generally beginning approximately 3

weeks after publication of a document,

in Room 443–G of the Department’s

office at 200 Independence Avenue,

SW., Washington, DC, on Monday

through Friday of each week from 8:30

a.m. to 5 p.m. (phone: (202) 690–7890).

FOR FURTHER INFORMATION CONTACT:

William Long, (410) 786–5655.

SUPPLEMENTARY INFORMATION:

I Background

A. Durable Medical Equipment

Durable medical equipment (DME) is

medical equipment furnished by a

supplier or a home health agency that is

primarily and customarily used to serve

a medical purpose. DME is able to

withstand repeated use and is generally

not useful to an individual in the

absence of a sickness or an injury. To be

covered by Medicare, DME must be

appropriate for use in a beneficiary’s

home or in an institution that is used as

a home. A hospital, or a critical access

hospital may not be considered an

institution that is used as a home for

this purpose. Similarly, a Medicarecertified SNF or other institution that is

primarily engaged in providing skilled

care to its residents may not be

considered an institution that is used as

a home.

While Medicare will pay for DME that

is adequate and effective to meet the

medical needs of the beneficiary, it will

not pay extra for convenience or luxury

features nor more than the applicable

fee schedule amount.

B. Payment for DME

Payment for DME furnished under

Part B of the Medicare program

(Supplementary Medical Insurance) is

made through contractors known as

Medicare carriers. Section 1834(a) of the

Social Security Act (the Act) provides

that Medicare payment for DME is equal

to 80 percent of the lesser of the actual

charge for the DME or the fee schedule

amount for the DME. Section 1834(a) of

the Act classifies DME into the

following payment categories:

• Inexpensive or other routinely purchased

DME.

• DME requiring frequent and substantial

servicing.

• Customized DME.

• Supplies and accessories used with DME

• Oxygen and oxygen equipment.

• Other items of DME (capped rental

items).

There is a specific methodology for

determining the fee schedule payment

amount for each category of DME. In

addition, for each of these categories

there are restrictions governing

Federal Register / Vol. 65, No. 82 / Thursday, April 27, 2000 / Proposed Rules 24667

payment. For example, inexpensive or

other routinely purchased DME may be

rented or purchased. However, oxygen

and DME requiring frequent and

substantial servicing may only be rented

and not purchased. Customized items

and other supplies may only be

purchased. Capped rental items, other

than electric wheelchairs, may initially

only be rented; however, the rental

payments can be applied to the

purchase of the item if the beneficiary

selects the purchase option after the

tenth rental month.

The fee schedules for DME are

calculated using average reasonable

charges from 1986 and 1987 and are

generally adjusted annually by the

change in the Consumer Price Index for

all Urban Consumers (CPI–U) for the 12-

month period ending June 30, of the

preceding year. In addition, the fee

schedules for DME are limited by a

ceiling (upper limit) and floor (lower

limit). The ceiling and floor are equal to

100 percent and 85 percent,

respectively, of the median of the local

(Statewide) fee amounts. The local fee

schedule amounts for areas outside the

continental United States are not

included in the calculation of the

ceiling and floor limits, nor are they

subject to the ceiling or floor limits.

This fee schedule payment methodology

is stated in 42 CFR part 414, subpart D.

C. Medicare’s Assignment Rules

An assignment is an agreement

between a supplier and a Medicare

beneficiary whereby the beneficiary

transfers to the supplier his or her right

to collect benefits for furnished covered

services. The supplier in return agrees:

• To accept, as full charge for the service,

the amount approved by the Medicare carrier

as the basis for determining the Medicare

Part B payment.

• To collect from the beneficiary only the

difference between the Medicare-approved

amount and the Medicare Part B payment,

that is, any deductible and coinsurance

amounts. A violation of the assignment

occurs if the supplier collects from the

beneficiary or anyone else any amount in

excess of the approved amount.

If the supplier does not accept

assignment, payment is made by the

carrier directly to the beneficiary less

any deductible and copayment and the

beneficiary is then responsible to the

supplier for the entire amount. Also,

without assignment the supplier is not

limited in his charges, and the

beneficiary may have to pay more than

he or she would have paid if the claim

had been assigned. The rules governing

assignment are stated in 42 CFR part

424, subpart D.

D. Current Payment Process for

Upgraded DME

An item of DME may have certain

convenience or luxury features that

make it more expensive than nonupgraded DME however, these features

are not necessary to adequately meet the

medical needs of the beneficiary.

Medicare does not cover medically

unnecessary upgrades. If a supplier

accepts assignment, it must accept the

Medicare-approved amount as full

payment for the upgraded DME.

The Medicare-approved payment

amount for the more expensive DME

cannot exceed the payment amount for

the non-upgraded DME. If a beneficiary

purchases or rents DME that has more

expensive features than his or her

condition requires, the supplier

accepting assignment for the DME may

not charge or collect any amount in

excess of the Medicare-approved

amount for the non-upgraded DME.

Currently, a supplier that wishes to

charge and collect a greater price for

upgraded DME must submit an

unassigned claim. The carrier then pays

the beneficiary an amount equal to the

Medicare payment, less the deductible

and coinsurance. The beneficiary is then

responsible to the supplier for the full

payment price of the upgraded DME.

The current procedures for Medicare

payment of assigned and unassigned

DME claims are stated in 42 CFR part

414, subpart D.

II. Provisions of the Balanced Budget

Act of 1997

On August 5, 1997, the Congress

passed the Balanced Budget Act of 1997

(BBA). Section 4551(c) of the BBA

added a second paragraph 1834(a)(17) to

the Act, authorizing the Secretary to

issue regulations under which an

individual may purchase or rent

upgraded DME from a supplier, and

Medicare payment would be made to

the supplier as if the upgraded DME

were non-upgraded DME if the supplier

presented an assigned claim.

Section 1834(a) second (17)(B) of the

Act provides that (i) In the case of the

purchase or rental of upgraded DME, the

supplier shall receive payment for that

upgraded DME as if the DME was nonupgraded DME; and (ii) the individual

purchasing or renting the DME shall pay

the supplier an amount equal to the

difference between the allowed

Medicare payment for the non-upgraded

DME and the supplier’s charge for the

upgraded DME. In no event may the

supplier’s charge for the upgraded DME

exceed the applicable fee schedule

amount (if any). In the event that the

upgraded DME is not on any fee

schedule, the supplier’s charge for the

DME upgrade shall not exceed the fair

market price to its other customers for

the same DME. Our authority for this

determination is section 1834(a) second

(17)(B)and (C)(v) of the Act. Under

section 1834(a) second (17)(B) of the

Act, these rules only apply to assigned

claims. Conversely, they do not apply to

unassigned claims.

Section 1834(a) second (17)(C) of the

Act requires that any regulations under

section 1834(a) second (17)(A) must

provide for consumer protection

standards with respect to the furnishing

of upgraded DME. These regulations

must provide for the following:

(1) A determination of the fair market

prices for upgraded DME.

(2) Full disclosure by the supplier of

the availability and price of nonupgraded DME and proof of receipt of

this disclosure information by the

beneficiary before furnishing upgraded

DME to the beneficiary.

(3) Conditions of participation for

suppliers in the billing arrangement.

(4) Sanctions (including exclusion) on

suppliers who we determine have

engaged in coercive or abusive

practices.

(5) Other safeguards that we

determine are necessary.

This amendment to the Act would

apply to purchases and rentals made

after the effective date of the final

regulations. Under section 1834(a)

second (17)(B) of the Act, these rules

only apply to assigned claims.

III. Provisions of This Proposed

Regulation

We propose to add the acronym

‘‘DME’’ for durable medical equipment

at § 414.202.

We propose to add a new § 414.231

that would permit suppliers to sell or

rent upgraded DME on an assigned basis

to a beneficiary and charge the

beneficiary the difference between the

supplier’s charge for the upgraded DME

and the allowed Medicare amount for

the non-upgraded DME, provided that

all consumer protection safeguards are

met. Medicare’s payment for the

upgraded DME would be the same

allowed amount as if the upgraded DME

was non-upgraded DME.

In § 414.231(a), we propose to add the

definition of upgraded DME.

We propose to add in § 414.231(c), the

requirements that suppliers must meet

before they are allowed to sell upgraded

DME to Medicare beneficiaries on an

assigned basis. These qualification rules

address: (1) Disclosure of information,

(2) Charge limitations, (3) Billing

requirements, (4) Returns of upgraded

24668 Federal Register / Vol. 65, No. 82 / Thursday, April 27, 2000 / Proposed Rules

DME by dissatisfied beneficiaries, and

(5) Conditions of participation.

We propose to add § 414.231(c)(1) to

describe the disclosure information that

the supplier must provide to the

beneficiary. It is our intention to design

a prescribed disclosure form that must

be used by suppliers who sell upgraded

DME and who accept assignment.

This section would also identify who

is responsible for obtaining the signed

disclosure form acknowledging that the

beneficiary or representative was given,

and understood, all of the required

information. This signed disclosure

form must also be signed by the supplier

and must attest that the supplier

informed the beneficiary that nonupgraded DME is available and

medically adequate for the beneficiary’s

needs; and informed the beneficiary of

the name of the manufacturer that made

the upgraded DME, the manufacturer’s

model number for the upgraded DME,

the manufacturer’s suggested retail price

for the upgraded DME, the supplier’s

usual or customary charge for the

upgraded DME, the estimated charge for

the DME without the upgraded features,

the beneficiary’s out-of-pocket cost for

the DME without the upgraded features,

the supplier’s charge to the beneficiary

for the upgraded DME, and the

beneficiary’s out of pocket cost for the

upgraded DME. A copy of the

completed disclosure form must be sent

by the DME supplier to the physician

prescribing the DME, if the beneficiary

elects to notify the prescribing

physician. The supplier must also retain

the signed disclosure form in its file and

upon request submit the disclosure form

to the Durable Medical Equipment,

Prosthetics, Orthotics and Supplies

(DMEPOS) carrier. We would require

this signed statement under the

authority of section 1834(a) second

(17)(C)(v) of the Act, which provides for

such other safeguards as the Secretary

determines are necessary.

We propose that a beneficiary who

receives an upgraded DME and is

dissatisfied with the DME upgrade may

return the upgraded DME within thirty

days and receive a full refund for the

upgraded portion of the DME from the

DME supplier. The DME supplier would

be required to furnish a non-upgraded

item of DME to the beneficiary.

We propose, under the authority of

section 1834(a) second (17)(C)(i) of the

Act, to add § 414.231(c)(2) to prohibit

the supplier’s charge for any upgraded

DME from exceeding the Medicare fee

schedule amount. If there is no

applicable fee schedule amount, the

supplier’s charge may not exceed the

lower of its customary charge to the

general public, or the manufacturer’s

suggested retail price.

We propose to add § 414.231(c)(3) to

require a supplier to submit claims,

with code modifiers, that indicate when

upgraded DME was furnished to a

Medicare beneficiary.

Section 1834(a) second (17)(B)

requires that for upgraded DME, the

Medicare payment amount must be

based on the payment amount for nonupgraded DME. We propose to require

suppliers to submit claims for upgraded

DME as if the DME was non-upgraded

DME. The rules governing the payment

methodology contained in part 414,

subpart D for non-upgraded DME,

would apply to upgraded DME.

We believe that section 1834(a)

second (17)(B)(i) precludes us from

paying for the upgraded DME as an

upgrade but requires that we pay as if

the DME was non-upgraded DME.

Therefore, we would use the same

payment methodology for the upgraded

DME as for the non-upgraded DME. This

would be less administratively

cumbersome, and would efficiently

utilize the safeguards built into the

current payment methodology.

For example, if a beneficiary wanted

to upgrade capped rental DME and

instead, obtain an upgraded DME that is

in the routinely purchased payment

category, the supplier would submit a

claim for, and the payment would be

based on, the non-upgraded capped

rental DME. The supplier also would be

required to use a code modifier on the

claim form to indicate that upgraded

DME had been furnished. The rules

governing the capped rental payment

category would therefore apply to the

routinely purchased DME. Thus, the

supplier would be required to submit

rental claims, even if the upgraded DME

was a routinely purchased DME, in

accordance with the capped rental

requirements. Likewise, the supplier

would be required to offer the purchase

option during the tenth rental month as

if the upgraded DME were in the capped

rental payment category. Finally, the

supplier would also be required to

comply with the capped rental

maintenance and servicing

requirements.

We propose to add § 414.231(c)(4) to

require suppliers furnishing upgraded

DME to comply with the supplier

standards for Durable Medical

Equipment, Prosthetics, Orthotics and

Supplies (DMEPOS) at § 424.57.

Finally, we propose to add

§ 414.231(d) to require that the

sanctions found in part 402 apply to any

supplier that engages in coercive or

abusive practices. These regulations also

would allow us to sanction a supplier

for failure to submit the documentation

that we would require in § 414.231(c).

This new provision would change the

nature of Medicare assignment in the

context of DME, and the protection it

has historically afforded beneficiaries

from being charged extra for equipment

or features of equipment that are not

medically necessary. In light of this

legislative departure from Medicare’s

long-established rules relating to

assignment and in light of the statutory

requirement for the Secretary to include

such other safeguards as the Secretary

determines are necessary, we are

especially interested in receiving

comments about the adequacy of the

beneficiary protections proposed in this

rule as well as the breadth of potential

additional approaches to beneficiary

protection. For example, it may be

important to distinguish between an

upgraded item that might be covered as

medically necessary for a particular

beneficiary from a slightly different item

for which there was no Medicare fee

schedule amount. In the former case, the

beneficiary would have the advantage of

Medicare payment for the item with

additional features while in the latter

case Medicare would pay only for the

item without features and the

beneficiary would pay, fully at their

own expense, for the difference between

the supplier’s charge for the upgraded

item and the Medicare payment for the

non-upgraded item. Or, it might be

appropriate to consider whether

upgrade covers minor variations in an

item of DME where the same code is

used to bill for the item as the standard

item. Therefore, we ask for comment

about manageable ways to look at and

quantify the extent of variation in DME

that would constitute an upgrade and

what might be the differences between

non upgraded DME and upgraded DME.

Because our experience in capturing

these distinctions for purposes of

payment is limited, we welcome

suggestions relating to potential

beneficiary protections which may need

to be introduced in this rule. For

example, we ask for comment about an

approach that might phase-in the

provision, focusing initially on certain

kinds of DME which we believe from

conversations with the industry to be

the items for which there may be the

greatest demand, and evaluating

impacts before expanding application of

the provision. We request comment

about particular categories of DME, such

as ultra light wheelchairs or total

electric hospital beds, to which the

provision might initially be applied if

we were to pursue a targeted approach.

Federal Register / Vol. 65, No. 82 / Thursday, April 27, 2000 / Proposed Rules 24669

IV. Response to Comments

Because of the large number of items

of correspondence we normally receive

on Federal Register documents

published for comment, 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, if we proceed

with a subsequent document, we will

respond to the major comments in the

preamble to that document.

V. Collection of Information

Requirements

Under the Paperwork Reduction Act

of 1995, (PRA) 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.

Therefore, we are soliciting public

comment on the information collection

requirement discussed below.

Section 414.231 Upgraded durable

medical equipment.

Section 414.231 (c) requires that the

supplier of DME give to the beneficiary

(or the beneficiary’s representative

renting or purchasing the DME on the

beneficiary’s behalf) a disclosure form,

indicating (1) the supplier informed the

beneficiary (or beneficiary’s

representative) that a non-upgraded

DME was available and explained that

the non-upgraded DME met the

beneficiary’s medical needs, (2) the

supplier provided the beneficiary or

beneficiary’s representative with the

estimated cost for both the nonupgraded DME and the additional outof-pocket cost for the upgraded DME.

This information would be provided

by the DME supplier on a one-time basis

for each sale of upgraded DME. We

would require the DME supplier to

retain the disclosure form and submit it

to the DMEPOS carrier upon request.

The DME supplier would also be

required to furnish a copy of the

disclosure form to the prescribing

physician, if the beneficiary elects to

notify the prescribing physician. Our

best estimate is that it would take 15

minutes or less for each sale of

upgraded DME.

Section 414.231(c)(3)(ii) requires that

the supplier use a code modifier, when

submitting a claim, that indicates that

the upgraded DME was furnished to a

Medicare beneficiary.

The burden that would be added as a

result of this reporting requirement is

minimal over that already approved,

through July 31, 2000, under OMB

approval number 0938–0008, which is

the approval number for the Medicare

common claim form (HCFA 1500). That

form currently has a field for a code

modifier, further diminishing the

burden of entering the modifier.

We have submitted a copy of this

proposed rule to OMB for its review of

the information collection requirement

described above. This requirement is

not effective until it has been approved

by OMB.

If you comment on this information

collection, please mail copies directly to

the following:

Health Care Financing Administration, Office of Information Services,

Security and Standards Group, Division

of HCFA Enterprise Standards Room

N2–14–26, 7500 Security Boulevard,

Baltimore, MD 21244–1850. ATTN: Julie

Brown, HCFA–1084–P, and Office of

Information and Regulatory Affairs,

Office of Management and Budget,

Room 10235, New Executive Office

building, Washington, DC 20503 Attn:

Allison Eydt, HCFA Desk Officer

V. Regulatory Impact Analysis

We have examined the impacts of this

proposed rule as required by Executive

Order (EO) 12866, the Unfunded

Mandates Act of 1995, and the

Regulatory Flexibility Act (RFA) (Public

Law 96–354). Executive Order 12866

directs agencies to assess all costs and

benefits of available regulatory

alternatives and, when 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 of $100

million or more annually. Since we

believe that this proposed rule would

have no significant effect on program

expenditures, we do not consider this to

be a major rule. We have not prepared

an RIA.

Section 1102(b) of the Act requires us

to prepare a RIA 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 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 50 beds. We are not

preparing a rural impact analysis since

we have determined that this proposed

rule would not have a significant

economic impact on operations of a

substantial number of small rural

hospitals.

The Unfunded Mandates Reform Act

of 1995 also requires (in section 202)

that agencies perform an assessment of

anticipated costs and benefits before

proposing any rule that may result in

expenditures, in any given year by State,

local, or tribal governments, in the

aggregate, or by the private sector, of

$100 million. This rule would not have

any effect on the Medicare expenditures

or the solvency of the Medicare Trust

Fund. The RFA requires agencies to

analyze options for regulatory relief of

small businesses. For purposes of the

RFA, small entities include small

businesses, nonprofit organizations, and

governmental agencies. Most hospitals

and most other providers and suppliers

are small entities, either by virtue of

their nonprofit status or by having

revenues of $5 million or less annually.

Intermediaries and carriers are not

considered to be small entities.

While we have estimated the time

required to complete the required form

as 15 minutes, we are unable to quantify

the ‘‘burden’’ this imposes because we

cannot predict the number of forms

individual suppliers will be completing.

A DME supplier has two options when

a beneficiary seeks to purchase

upgraded DME. One option is simply to

sell the beneficiary the item and allow

the beneficiary to submit an unassigned

claim. This option imposes no burden

on the supplier and the beneficiary is

not required to complete the form. The

second option is to accept assignment

and to complete and submit the form.

Given the resources at our disposal, we

cannot determine the number of DME

suppliers that would accept either

option.

We believe that beneficiaries may use

the upgrade provision to obtain only a

relatively few categories of equipment.

We also believe that this provision

might be used mostly by more active

beneficiaries who desire wheelchairs

that contain features suited to their

active lifestyles, such as upgrading from

standard wheelchairs to ultra light

24670 Federal Register / Vol. 65, No. 82 / Thursday, April 27, 2000 / Proposed Rules

weight wheelchairs. Although there are

perhaps 100 large DME suppliers, there

is a total of more than 100,000 dealers.

It is impossible to estimate the

distribution of assigned claims that

involve upgraded DME across either the

smaller or the larger group. Based on the

industry’s own assertions, however, we

do not believe that any one supplier will

incur a significant burden. If we receive

additional information as a result of this

proposed rule, we would revisit the idea

of calculating the burden arising from

this provision.

We are not preparing an analysis for

section 1102(b) of the Act because this

rule is not a major rule as defined at 5

U.S.C. 804(2), nor will it have a

significant economic impact on the

operations of a substantial number of

small rural hospitals.

We have reviewed this proposed rule

under the threshold criteria of Executive

Order 13132, Federalism. We have

determined that it does not significantly

affect the rights, roles and responsibility

of States. In accordance with the

provisions of Executive Order 12866,

this regulation was reviewed by the

Office of Management and Budget.

List of Subjects in 42 CFR Part 414

Administrative practice and

procedure, Health facilities, Health

professions, Kidney diseases, Medicare,

Reporting and recordkeeping

requirements, Rural areas, X-rays.

For the reasons stated in the

preamble, the Health Care Financing

Administration proposes to amend 42

CFR part 414 as follows:

PART 414—PAYMENT FOR PART B

MEDICAL AND OTHER HEALTH

SERVICES

1. The authority citation for part 414

continues to read as follows:

Authority: 42 U.S.C. 1302, and 1395hh.

2. Add the acronym ‘‘DME’’ to the

definition of durable medical equipment

in § 414.202 to read as follows:

§ 414.202 Definitions.

* * * * *

Durable medical equipment (DME)

means equipment, furnished by a

supplier or a home health agency that—

* * * * *

3. Add § 414.231 to subpart D to read

as follows:

§ 414.231 Upgraded durable medical

equipment.

(a) Definition. Upgraded durable

medical equipment means DME that

contains features that are not reasonable

and necessary for the treatment of an

illness or an injury, or to improve the

functioning of a malformed body

member.

(b) General rules. (1) HCFA pays for

DME that meets the coverage

requirements in § 410.38.

(2) For upgraded DME, HCFA pays a

supplier an amount equal to the

Medicare-approved amount that it pays

for DME that does not contain upgraded

features under § 414.210, less any

applicable beneficiary deductible and

coinsurance.

(3) If a beneficiary purchases or rents

upgraded DME, the beneficiary is

responsible for the difference in the

payment between the supplier’s charge

for the upgraded DME and the

Medicare-approved amount for the DME

without the upgraded features, in

addition to any applicable beneficiary

deductible and coinsurance.

(c) Rules for suppliers—(1) Disclosure

of information. Before furnishing

upgraded DME to a beneficiary, a

supplier must meet the following

requirements:

(i) Give to the beneficiary (or the

representative renting or purchasing the

DME on the beneficiary’s behalf) a

disclosure form prescribed by HCFA

containing the following information:

(A) The DME without the upgraded

features effectively meets the

beneficiaries medical needs and is as

available as the upgraded DME.

(B) The name of the manufacturer that

made the upgraded DME.

(C) The manufacturer’s model number

for the upgraded DME.

(D) The manufacturer’s suggested

retail price for the upgraded DME.

(E) The supplier’s usual or customary

charge for the upgraded DME.

(F) The estimated charge, and the

beneficiary’s out-of-pocket costs for the

DME without the upgraded features.

(G) The supplier’s charge to the

beneficiary for the upgraded DME and

the beneficiary’s out-of pocket cost for

the upgraded DME.

(ii) The supplier must obtain the

beneficiary’s or representative’s

signature on the disclosure form,

attesting that the beneficiary or

representative has read and understands

the information provided on the form.

(iii) The supplier must furnish a copy

of the signed disclosure form to the

prescribing physician, provided the

beneficiary elects to notify the

prescribing physician, retain the signed

disclosure form in its file and, upon

request, submit the signed disclosure

form to the DMEPOS carrier.

(2) Charge limitations. The suppliers

charge for upgraded DME must not

exceed the applicable Medicare fee

schedule amount (if any) for the

upgraded DME. If there is no fee

schedule amount for the upgraded DME,

the supplier’s charge for the upgraded

DME must not exceed the lower of its

customary charge to the general public,

or the manufacturer’s suggested retail

price.

(3) Billing requirements. A supplier

must meet the following billing

requirements:

(i) Follow the payment and billing

requirements for the DME without the

upgraded features.

(ii) Submit a claim, with a code

modifier indicating that upgraded DME

was furnished to a Medicare beneficiary.

(4) Returns of upgraded DME. (i) A

supplier must refund any payments

made by a beneficiary, for the upgraded

portion of an item of upgraded DME if

the beneficiary, or representative,

returns the upgraded DME to the

supplier within 30 days of receiving the

upgraded DME.

(ii) The supplier must furnish the

DME without the upgrade to the

beneficiary at no additional cost.

(5) Conditions of participation.

Suppliers submitting claims for

upgraded DME must comply with the

special payment rules for DMEPOS

suppliers at § 424.57 of this chapter.

(d) Supplier sanctions. If a supplier

engages in coercive or abusive practices

regarding the sale or rental of upgraded

DME, HCFA may apply to the supplier

the same sanctions found in part 402 of

this subchapter that it may apply to a

physician.

(Catalog of Federal Domestic Assistance

Program No. 93.774, Medicare—

Supplementary Medical Insurance Program)

Dated: January 24, 2000.

Nancy-Ann Min DeParle,

Administrator, Health Care Financing

Administration.

Approved: March 17, 2000.

Donna E. Shalala,

Secretary.

[FR Doc. 00–10482 Filed 4–26–00; 8:45 am]

BILLING CODE 4120–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[DA–00–890, MM Docket No. 00–68, RM–

9854]

Digital Television Broadcast Service;

Norfolk, VA

AGENCY: Federal Communications

Commission.

ACTION: Proposed rule.

SUMMARY: The Commission requests

comments on a petition filed by WTKRVerDate 26<APR>2000 17:42 Apr 26, 2000 Jkt 190000 PO 00000 Frm 00015 Fmt 4702 Sfmt 4702 E:\FR\FM\27APP1.SGM pfrm02 PsN: 27APP1