41032 Federal Register / Vol. 76, No. 133 / Tuesday, July 12, 2011 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 440 

[CMS 2348–P] 

RIN 0938–AQ36 

Medicaid Program; Face-to-Face 

Requirements for Home Health 

Services; Policy Changes and 

Clarifications Related to Home Health 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

revise the Medicaid home health service 

definition as required by section 6407 of 

the Affordable Care Act to add a 

requirement that physicians document 

the existence of a face-to-face encounter 

(including through the use of telehealth) 

with the Medicaid eligible individual 

within reasonable timeframes. This 

proposal would align the timeframes 

with similar regulatory requirements for 

Medicare home health services in 

accordance with section 6407 of the 

Affordable Care Act and reflects CMS’ 

commitment to the general principles of 

the President’s Executive Order 13563 

released January 18, 2011, entitled 

‘‘Improving Regulation and Regulatory 

Review.’’ In addition, this rule proposes 

to amend home health services 

regulations to clarify the definitions of 

included medical supplies, equipment 

and appliances, and clarify that States 

may not limit home health services to 

services delivered in the home, or to 

services furnished to individuals who 

are homebound. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below, no later 

than 5 p.m. September 12, 2011. 

ADDRESSES: In commenting, please refer 

to file code CMS–2348–P. 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 ‘‘Submit a comment’’ instructions. 

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– 

2348–P, P.O. Box 8016, Baltimore, 

MD 21244–8016. 

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–2348–P, 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– 

7195 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: 

Melissa Harris, (410) 786–3397. 

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. Background 

A. General Information 

Title XIX of the Social Security Act 

(the Act) requires that, in order to 

receive Federal Medicaid matching 

funds, a State must offer certain basic 

services to the categorically needy 

populations specified in the Act. Home 

health care for Medicaid-eligible 

individuals who are entitled to nursing 

facility services is one of these 

mandatory services. Individuals 

‘‘entitled to’’ nursing facility services 

include the basic categorically needy 

populations that receive the standard 

Medicaid benefit package, and can 

include medically needy populations if 

nursing facility services are offered to 

the medically needy within a State. 

Home health services include skilled 

nursing, home health aide services, 

medical supplies, equipment, and 

appliances, and may include 

therapeutic services. Current Medicaid 

regulations require an individual’s 

physician to order home health services 

as part of a written plan of care 

reviewed every 60 days. 

B. Summary of New Medicare Home 

Health Face-to-Face Statutory 

Requirements 

Section 6407 of the Patient Protection 

and Affordable Care Act of 2010 (the 

Affordable Care Act), (Pub. L. 111–148, 

enacted on March 23, 2010), as 

amended by section 10605 of the 

Affordable Care Act, affects the home 

health benefit under both the Medicare 

and Medicaid programs. 

Section 6407(a) of the Affordable Care 

Act (as amended by section 10605 of the 

Affordable Care Act) added new 

requirements to section 1814(a)(2)(C) of 


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the Act under Part A of the Medicare 

program, and section 1835(a)(2)(A) of 

the Act, under Part B of the Medicare 

program, that the physician, or certain 

allowed nonphysician practitioners 

(NPPs), document a face-to-face 

encounter with the individual 

(including through the use of telehealth, 

subject to the requirements in section 

1834(m) of the Act), prior to making a 

certification that home health services 

are required under the Medicare home 

health benefit. Section 1814(a)(2)(C) of 

the Act indicates that in addition to a 

physician, a nurse practitioner or 

clinical nurse specialist (as those terms 

are defined in section 1861(aa)(5) of the 

Act) who is working in collaboration 

with the physician in accordance with 

State law, or a certified nurse-midwife 

(as defined in section 1861(gg) of the 

Act, as authorized by State law), or a 

physician assistant (as defined in 

section 1861(aa)(5) of the Act), under 

the supervision of the physician, may 

conduct the face-to-face encounters 

prior to the start of home health 

services. 

Section 6407(b) of the Affordable Care 

Act amended section 1834(a)(11)(B) of 

the Act to require documentation of a 

similar face-to-face encounter with a 

physician or specific NPPs by a 

physician ordering durable medical 

equipment (DME). The NPPs authorized 

to conduct a face-to-face encounter on 

behalf of a physician are the same for 

this provision as for the provision 

described above, with one exception. 

We interpret sections 6407(b) and 

6407(d) of the Affordable Care Act to 

prohibit certified nurse-midwives from 

conducting the face-to-face encounter 

prior to the physician ordering DME. 

The timing of this face-to-face encounter 

is specified as being within the 6-month 

period preceding the written order for 

DME, or other reasonable timeframe 

specified by the Secretary. This 

provision also maintains the role of the 

physician in the actual ordering of DME. 

C. Application of Home Health Face-toFace Requirements to Medicaid 

Section 6407(d) of the Affordable Care 

Act provides that the requirements for 

face-to-face encounters in the provisions 

described above ‘‘shall apply in the case 

of physicians making certifications for 

home health services under title XIX of 

the Social Security Act in the same 

manner and to the same extent as such 

requirements apply in the case of 

physicians making such certifications 

under title XVIII of such Act.’’ The 

purpose of this regulation is to 

implement that statutory directive. 

In implementing the face-to-face 

encounter requirements of section 6407 

of the Affordable Care Act, we take into 

consideration the existing regulatory 

requirements under § 440.70 that 

provide that a physician must order an 

individual’s services under the 

Medicaid home health benefit. We read 

the term ‘‘order’’ to be synonymous with 

the Medicare term ‘‘certify.’’ For 

purposes of this rule, we use the term 

‘‘order’’ in place of the Affordable Care 

Act’s use of ‘‘certify.’’ 

We do not view implementation of 

section 6407 of the Affordable Care Act 

as supplanting the existing Medicaid 

regulatory requirements related to 

physician orders but as consistent with 

those requirements. The provisions of 

section 6407 of the Affordable Care Act 

make clear that the physician’s order 

must be based on a face-to-face 

encounter. In addition, section 6407 of 

the Affordable Care Act provides that 

specific NPP may perform the face-toface encounter with the individual in 

lieu of the physician, and inform the 

physician making the initial order for 

service under the Medicaid home health 

benefit. 

Consistent with that view, in the 

proposed regulation, we would provide 

that the physician must document the 

face-to-face encounter regardless of 

whether the physician himself or herself 

or one of the permitted NPPs performed 

the face-to-face encounter. The timing of 

this face-to-face encounter is specified 

as being within the 6-month period 

preceding the written order for home 

health services, or other reasonable 

timeframe specified by the Secretary. 

Similarly, in implementing the 

requirements under section 6407(b) of 

the Affordable Care Act, relating to 

DME, we take into account existing 

Medicaid regulatory requirements under 

§ 440.70 requiring physician orders. 

Because DME is not a term used in 

Medicaid in the same manner as in 

Medicare, we use the Medicaid term 

‘‘medical supplies, equipment and 

appliances’’ or the shortened version 

‘‘medical equipment.’’ The NPPs 

authorized to conduct a face-to-face 

encounter on behalf of a physician are 

the same for this provision as for the 

provision described above, with one 

exception. Certified nurse-midwives are 

not permitted to conduct the face-to-face 

encounter prior to the physician 

ordering medical equipment. Therefore, 

we are proposing to amend the 

Medicaid regulations at § 440.70 to 

incorporate both the general home 

health and the medical equipment faceto-face requirements. 

D. Other Medicaid Home Health Policy 

Changes 

1. Clarification That Home Health 

Services Cannot Be Restricted to 

Individuals Who Are Homebound or to 

Services Furnished in the Home 

We are proposing to incorporate in 

regulation that home health services 

may not be subject to a requirement that 

the individual be ‘‘homebound.’’ In 

addition, we are proposing to clarify 

that home health services cannot 

otherwise be restricted to services 

furnished in the home itself. 

On July 25, 2000, we issued a letter 

to State Medicaid Directors, Olmstead 

Update No: 3, in which we discussed 

Federal policies relevant to State efforts 

to comply with the requirements of the 

Americans with Disabilities Act (ADA) 

in light of the Supreme Court decision 

in Olmstead v. L.C., 527 U.S. 581 (1999). 

In attachments to that letter, we set forth 

specific policy clarifications to allow 

States more flexibility to serve 

individuals with disabilities in various 

ways and in different settings. 

Attachment 3-g of the letter: 

‘‘Prohibition of Homebound 

Requirements in Home Health’’ clarified 

that the use of a ‘‘homebound’’ 

requirement under the Medicaid home 

health benefit violates Federal 

regulatory requirements at § 440.230(c) 

and § 440.240(b). These requirements 

provide that mandatory benefits must be 

sufficient in amount, duration and 

scope to reasonably achieve their 

purpose, may not be arbitrarily denied 

or reduced in scope based on diagnosis, 

type of illness, or condition, and that 

the same amount, duration and scope 

must be available to any individual 

within the group of categorically needy 

individuals and within any group of 

medically needy individuals. In the 

attachment, we stated that the 

restriction of home health services to 

individuals who are homebound to the 

exclusion of other individuals in need 

of these services ignores the reality that 

individuals with disabilities can and do 

live and function in the community. We 

further noted that developments in 

technology and service delivery made it 

possible for individuals with even the 

most severe disabilities to participate in 

a wide variety of activities in the 

community with appropriate supports. 

We also expressed the importance of 

ensuring that Medicaid is available to 

provide medically necessary home 

health services to individuals in need of 

those services who are not homebound 

and continue to be an important part of 

efforts to offer individuals with 

disabilities services in the most 


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41034 Federal Register / Vol. 76, No. 133 / Tuesday, July 12, 2011 / Proposed Rules 

integrated setting appropriate to their 

needs, in accordance with the ADA. 

We are clarifying in this rule that 

Medicaid home health services may not 

be limited to services furnished in the 

home. This policy reflects prior court 

cases on the subject. In Skubel v. 

Fuoroli, 113 F.3d 330 (2d. Cir. 1997) the 

court found that the Medicaid statute 

did not address the site of care for the 

mandatory home health benefit. The 

court found that the State could not 

limit coverage of home health services 

to those provided at the individual’s 

residence. In 1990, the same court ruled 

invalid an interpretation that limited the 

provision of private duty nursing 

services to an individual’s residence. 

The case, Detsel v. Sullivan, 895 F.2d 58 

(2d Cir.1990), involved children 

suffering from severe medical 

conditions. Following the Detsel case, 

CMS, then the Health Care Financing 

Administration, ultimately adopted the 

court’s standard and issued nationwide 

guidance eliminating the at-home 

restriction on private duty nursing. To 

date, we have not issued similar 

guidance requiring nationwide adoption 

of the Skubel ruling. We are using our 

authority through this rulemaking 

opportunity to do so. 

2. Clarification of the Definition of 

Medical Supplies, Equipment and 

Appliances 

An important component of the 

Medicaid home health benefit is 

medical supplies, equipment and 

appliances, under § 447.70(b)(3). The 

current wording of the regulation does 

not further define these terms, except to 

indicate that these items should be 

‘‘suitable for use in the home.’’ 

Although this phrase could be read to 

refer only to the type of items included 

in the benefit, it has been susceptible to 

reading as a prohibition on use of 

covered items outside the home. We are 

using this opportunity to revise that 

phrase to make clear that it is not a 

limitation on the location in which 

items are used, but rather refers to items 

that are necessary for everyday activities 

and not specialized for an institutional 

setting. Thus we would indicate that 

these items must be ‘‘suitable for use in 

any non-institutional setting in which 

normal life activities take place.’’ This 

would clarify that although States may 

continue to establish medical necessity 

criteria to determine the authorization 

of these items, States may not deny 

requests for these items based on the 

grounds that they are for use outside of 

the home. 

Current Medicaid regulations do not 

contain any specific definition of 

medical supplies, equipment, and 

appliances under the home health 

benefit, other than the language 

discussed in the prior paragraph. States 

have adopted reasonable definitions of 

those terms, for example, based on the 

Medicare definition. But in the absence 

of a generally applicable definition of 

the term, there has been confusion as to 

the proper scope of the benefit. 

We believe that a consistent approach 

to categorizing home health medical 

supplies, equipment, and appliances 

will ensure beneficiaries are receiving 

needed items and provide clear and 

consistent guidance to States to ensure 

the use of the appropriate benefit 

category. We are now taking this 

opportunity to propose criteria defining 

home health supplies, equipment, and 

appliances, to better align with the 

Medicare program’s definition of 

durable medical equipment found at 

§ 414.202. We propose that supplies are 

defined as ‘‘health care related items 

that are consumable or disposable, or 

cannot withstand repeated use by more 

than one individual.’’ We propose that 

medical equipment and appliances are 

‘‘items that are primarily and 

customarily used to serve a medical 

purpose, generally not useful to an 

individual in the absence of an illness 

or injury, can withstand repeated use, 

and can be reusable or removable.’’ 

We believe these standard definitions 

will ensure that such items will be 

available to all who are entitled to the 

home health benefit, and not restricted 

to individuals eligible for targeted 

benefits through home and communitybased services (HCBS) waivers or the 

section 1915(i) HCBS State Plan option. 

Items that meet the criteria for coverage 

under the home health benefit must be 

covered as such. States will not be 

precluded from covering items meeting 

this definition through a section 1915(c) 

HCBS waiver service, such as a home 

modification, or through a section 

1915(i) State Plan option. However, the 

State must also offer those items as 

home health supplies, equipment and 

appliances. 

3. Other Issues 

We note that we are considering 

whether other clarifications to the home 

health regulations are warranted. In 

particular, we are considering whether 

it would be useful to include language 

to reflect the policies set forth in a 

September 4, 1998 letter to State 

Medicaid Directors, responding in part 

to a Second Circuit decision in Desario 

v. Thomas, 139 F. 3d 80 (1998), about 

the use of lists or other presumptions in 

determining coverage of items under the 

home health benefit for medical 

equipment. In that letter, we indicated 

that a State could use such lists or 

presumptions, but must provide 

individuals the opportunity to rebut the 

list or presumption with a process that 

employs reasonable and specific criteria 

to assess coverage for an item based on 

individual medical needs, and 

determine whether the list or 

presumption is based on an arbitrary 

exclusion based on diagnosis, type of 

illness, or condition. We have not 

proposed any language to reflect this 

policy in part because the principles at 

issue are not specific to home health 

medical equipment. We invite comment 

on this issue. 

In addition, in the May 5, 2010 

Federal Register (75 FR 24437), we 

issued the ‘‘Medicare and Medicaid 

Programs: Changes in Provider and 

Supplier Enrollment, Ordering and 

Referring, and Documentation 

Requirements; and Changes in Provider 

Agreements’’, interim final rule which 

was effective on July 6, 2010. Although 

we have not incorporated changes to the 

scope of providers that may order 

medical supplies, equipment and 

appliances in the Medicaid program, as 

section 6405(a) of the Affordable Care 

Act was not applicable to Title XIX, we 

are specifically soliciting comments 

through this rule on the merits of doing 

so. 

II. Provisions of the Proposed 

Regulations 

Please note that although the 

Affordable Care Act uses the term 

‘‘individual’’ to refer to the Medicaid 

beneficiary, throughout this proposed 

rule we have used ‘‘recipient’’ to mirror 

the regulation text in the current 

Medicaid home health regulations. At 

this time, we do not intend to modify 

this term. 

For the reasons discussed above, we 

propose to modify § 440.70(b)(3) to say 

the following: ‘‘Medical supplies, 

equipment and appliances suitable for 

use in any non-institutional setting in 

which normal life activities take place.’’ 

In § 440.70(b)(3)(i) and (ii), we 

propose revising the current text to 

define what constitutes medical 

supplies, equipment, and appliances. 

We propose to indicate that supplies are 

defined as ‘‘health care related items 

that are consumable or disposable, or 

cannot withstand repeated use by more 

than one individual.’’ We propose to 

indicate that medical equipment and 

appliances are ‘‘items that are primarily 

and customarily used to serve a medical 

purpose, generally not useful to an 

individual in the absence of an illness 

or injury, can withstand repeated use, 

and can be reusable or removable.’’ We 


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Federal Register / Vol. 76, No. 133 / Tuesday, July 12, 2011 / Proposed Rules 41035 

are specifically soliciting comment on 

these proposed provisions. 

For the reasons discussed above, we 

propose to modify § 440.70(c), to add 

the following text to the end of the 

current provision: ‘‘Nothing in this 

section should be read to prohibit a 

recipient from receiving home health 

services in any non-institutional setting 

in which normal life activities take 

place.’’ Although the Court indicated 

that individuals would be limited to the 

same number of service hours they 

would have received if the home health 

services were provided only in their 

place of residence, in an effort to not 

limit the ability of States to offer a more 

robust home health benefit, we propose 

to allow States the option to authorize 

additional services or hours of services 

to account for this new flexibility. We 

also propose to add more text at the end 

of this provision as follows: ‘‘Additional 

services or service hours may, at the 

State’s option, be authorized to account 

for medical needs that arise in these 

settings’’. This will incorporate both the 

Skubel and Olmstead decisions into the 

provision of home health services. This 

State flexibility would be applied to the 

State’s Medicaid program as a whole, 

and would not be a person-specific 

flexibility. State medical necessity 

criteria would continue to be applied 

uniformly to all Medicaid individuals. 

We note that any such additional hours 

of service that are authorized by the 

State would be matched at the State’s 

current Federal Medical Assistance 

Percentage (FMAP). 

The remainder of this section pertains 

to proposed changes to § 440.70 to 

incorporate provisions of the Affordable 

Care Act. 

Section 6407 of the Affordable Care 

Act requires, as a condition for payment 

for home health services, 

documentation of a face-to-face 

encounter prior to an order for such 

services. Section 6407 of the Affordable 

Care Act requires that the timing of the 

face-to-face encounter for home health 

services must occur within the 6-month 

period preceding certification, or other 

reasonable timeframe determined by the 

Secretary. Based on the same reasoning 

set out in the Medicare final rule, 

Medicare Program; Home Health 

Prospective Payment System Rate 

Update for Calendar Year 2011; Changes 

in Certification Requirements for Home 

Health Agencies and Hospices as 

published in the November 17, 2010, 

Federal Register, we propose to 

determine a reasonable timeframe for 

the face-to-face encounter that is shorter 

than 6 months. The statutory goal is to 

achieve greater physician accountability 

in ordering home health services. To 

achieve this goal, the encounter must 

occur close enough to the start of home 

health services to ensure that the 

clinical conditions exhibited by the 

recipient during the encounter are 

related to the primary reason for the 

recipient’s need for home health 

services. As such, we believe that 

encounters would need to occur closer 

to the start of home health services 

rather than the 6-month period initially 

indicated, but not required by the 

Affordable Care Act. 

Consistent with the Medicare 

program’s implementation of this 

provision, we propose to indicate in a 

new § 440.70(f)(1) that for the initial 

ordering of home health services, the 

physician must document that a face-toface encounter that is related to the 

primary reason the individual requires 

home health services has occurred no 

more than 90 days prior to the start of 

services under the Medicaid home 

health benefit. We believe that in most 

cases, a face-to-face encounter with a 

recipient within the 90 days prior to the 

start of home health services will 

provide the physician and/or specified 

NPPs with a current clinical 

presentation of the recipient’s condition 

such that the physician can accurately 

order home health services and 

establish an effective care plan, based 

on the encounter conducted by either 

the physician or allowed NPP. We also 

believe that a face-to-face encounter 

which occurs within 90 days prior to 

the start of services would be generally 

relevant to the reason for the recipient’s 

need for home health services, and 

therefore such a face-to-face encounter 

would be sufficient to meet the goals of 

this statutory requirement. We 

recognize, however, that there may be 

circumstances when it may not be 

possible to meet this general 

requirement, and the individual’s access 

to needed services must be protected. 

To account for these circumstances, we 

also propose in § 440.70(f)(1) to allow an 

opportunity to meet the face-to-face 

encounter requirement through an 

encounter with the recipient within 30 

days after the start of home health 

services. 

While we recognize the necessity of 

permitting face-to-face encounters to 

occur after the start of services in the 

instances described above, we 

emphasize that the timing of the face-toface encounter in normal circumstances 

should occur within the 90 days prior 

to the start of home health services. 

The statute describes NPPs who may 

perform this face-to-face encounter as a 

nurse practitioner or clinical nurse 

specialist, as those terms are defined in 

section 1861(aa)(5) of the Act, who is 

working in collaboration with the 

physician in accordance with State law, 

or a certified nurse-midwife (as defined 

in section 1861(gg) of the Act, as 

authorized by State law), or a physician 

assistant (as defined in section 

1861(aa)(5) of the Act), under the 

supervision of the physician. 

The statutory provision allows the 

permitted NPPs to perform the face-toface encounter and inform the 

physician, who documents the 

encounter. 

Based on the same reasoning set out 

in the Medicare proposed rule, 

Medicare Program; Home Health 

Prospective Payment System Rate 

Update for Calendar Year 2012; 

published elsewhere in this Federal 

Register, for individuals admitted to 

home health upon discharge from a 

hospital or post-acute setting, we 

propose to also allow the physician who 

attended to the individual in the 

hospital or post-acute setting to inform 

the ordering physician regarding their 

encounters with the individual to satisfy 

the face-to-face encounter requirement, 

much like an NPP currently can. 

We propose to add a new 

§ 440.70(f)(2) to list the practitioners 

that may perform the face-to-face 

encounters. These practitioners include 

the physician already referenced in 

§ 440.70(a)(2), and the following NPPs: 

A nurse practitioner or clinical nurse 

specialist (as those terms are defined in 

section 1861(aa)(5) of the Act) who is 

working in collaboration with the 

physician in accordance with State law, 

or a certified nurse-midwife (as defined 

in section 1861(gg) of the Act, as 

authorized by State law), or a physician 

assistant (as defined in section 

1861(aa)(5) of the Act), under the 

supervision of the physician, and for 

recipients admitted to home health 

immediately after an acute or post-acute 

stay, the attending acute or post-acute 

physician. 

We also propose to add a new 

§ 440.70(f)(3) to indicate that if an 

attending acute or post-acute physician 

or allowed NPP conducts the face-toface visit, the attending acute or postacute physician or practitioner is 

required to communicate the clinical 

findings of the face-to-face encounter to 

the physician, in order for the physician 

to document the face-to-face encounter 

accordingly. This requirement is 

necessary to ensure that the physician 

has sufficient information to determine 

the need for home health services, in the 

absence of conducting the face-to-face 

encounter himself or herself. We are 

also proposing to specify that these 

clinical findings must be reflected in a 

written or electronic document included 


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41036 Federal Register / Vol. 76, No. 133 / Tuesday, July 12, 2011 / Proposed Rules 

in the recipient’s medical record 

(whether by the physician or by the 

NPP). We are not prescribing at the 

Federal level the specific elements 

necessary to document the face-to-face 

encounter, as that is a matter of clinical 

judgment that could vary according to 

the individual circumstance. However, 

States may choose to implement a 

minimum list of required information to 

adequately document the encounter. 

In a new § 440.70(f)(4)(i), we propose 

to require that the physician’s 

documentation of the face-to-face 

encounter must be either a separate and 

distinct area on the written order, an 

addendum to the order that is easily 

identifiable and clearly titled, or a 

separate document easily identifiable 

and clearly titled in the recipient’s 

medical record. The documentation 

must also describe how the health status 

of the recipient at the time of the faceto-face encounter is related to the 

primary reason the recipient requires 

home health services. In a new 

§ 440.70(f)(4)(ii), we propose to require 

that the physician’s documentation of 

the face-to-face encounter be clearly 

titled, and state that either the physician 

himself or herself, or the applicable 

NPP, has conducted a face-to-face 

encounter with the recipient and 

include the date of that encounter. 

Finally, we propose to add a new 

§ 440.70(f)(5) to indicate that the face-toface encounters may be performed 

through the use of telehealth. We are 

aware that many States currently make 

use of telehealth or telemedicine in the 

delivery of Medicaid services. Medicaid 

has issued informal guidance on the 

parameters of telehealth and 

telemedicine that is modeled after 

Medicare requirements. We are 

proposing to allow States to continue 

utilizing their current telehealth 

technologies as they apply to the 

implementation of this provision, 

however we are cognizant that State 

Medicaid telehealth policies may not 

align with Medicare’s. We wish to 

minimize duplication and fragmentation 

of services for beneficiaries who are 

dually-eligible for Medicare and 

Medicaid, and therefore we are 

specifically soliciting comment on 

approaches to telehealth policy that 

would further this goal. 

In a new § 440.70(g), we propose to 

apply all of the requirements of 

§ 440.70(f) to the provision of supplies, 

equipment and appliances as described 

in § 440.70(b)(3) to the extent that a 

face-to-face encounter would be 

required under the Medicare program 

for durable medical equipment, with 

one exception from the requirements at 

§ 440.70(f). The Affordable Care Act 

does not permit certified nurse 

midwives to conduct face-to-face 

encounters required for these items. 

This is reflected in our proposed 

§ 440.70(g)(2). 

The proposal to limit the face-to-face 

requirements to items that would be 

subject to such requirements as durable 

medical equipment under the Medicare 

program is based on the aim of 

maximizing consistency with the 

Medicare program’s implementation of 

section 6407 of the Affordable Care Act 

and reducing administrative burden on 

the provider community. Thus we 

would only require that, for items of 

durable medical equipment specified by 

CMS under the Medicare program as 

subject to a face-to-face encounter 

requirement, the physician must 

document that a face-to-face encounter 

that is related to the primary reason the 

individual requires the item has 

occurred no more than 90 days before 

the order is written or within 30 days 

after the order is written. We intend to 

issue guidance to States indicating how 

they, and providers, can access the 

current Medicare list of specific durable 

medical equipment items subject to the 

face-to-face requirement. 

Medical supplies, equipment and 

appliances for which a face-to-face 

encounter would not be required under 

the Medicare program as durable 

medical equipment, would not require a 

face-to-face encounter prior to the 

ordering of items under the Medicaid 

program. These items will be of a 

smaller dollar value, and at a decreased 

risk for fraud, waste and abuse. We 

welcome public comment on this 

approach. 

We recognize the difficulty that some 

recipients with complex medical needs 

may face in participating in a face-toface encounter (such as issues with 

accessing transportation, obtaining 

caregiver support, etc.,) particularly in 

rural areas. Once this rule is finalized, 

we expect States to implement this 

provision in a way that does not result 

in barriers to service delivery, as this is 

not the intent of the legislation. The 

statute specifically references telehealth 

as an alternative for ensuring that this 

new requirement is implemented in a 

way that protects continuity of services. 

We encourage States to work with the 

home health provider community to 

incorporate these face-to-face visits in 

creative and flexible ways to account for 

individual circumstances. We are 

available to provide technical assistance 

to States in achieving this goal. 

In keeping with a movement across all 

Medicaid services, we expect the plans 

of care developed to address a 

recipient’s home health needs be done 

in a way that embraces a personcentered philosophy. For clarification 

and consistency among programs, our 

expectation regarding the personcentered philosophy is that the plan of 

care reflects what is important to the 

recipient and for the recipient. The 

person-centered approach is a process, 

directed by the recipient with long-term 

support needs, or by another person 

important in the life of the recipient 

who the recipient has freely chosen to 

direct this process, intended to identify 

the strengths, capacities, preferences, 

needs, and desired outcomes of the 

recipient. The person-centered process 

includes the opportunity for the 

recipient to choose others to serve as 

important contributors to the planning 

process. 

This process and the resulting service 

plan will assist the recipient in 

achieving personally defined outcomes 

in the most integrated community 

setting in a manner that reflects what is 

important to the recipient to ensure 

delivery of services in a manner that 

reflects personal preferences and 

choices, and what is important for the 

recipient to meet identified support 

needs. 

III. 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): 

Proposed § 440.70(f)(3) and (g)(1) 

require NPPs and attending acute or 

post-acute physicians to communicate 

the clinical findings of the face-to-face 

encounter to the ordering physician. 

The burden associated with these 


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requirements would be the time and 

effort required for the NPP and 

attending acute or post-acute physicians 

to complete this communication. This is 

estimated at 10 minutes for each 

encounter. We estimate that there would 

be 1,143,443 initial home health 

episodes in a year based on our 2008 

claims data. As such, the estimated 

burden for the NPP and attending acute 

or post-acute physicians documenting, 

signing, and dating the recipient’s faceto-face encounter would be 190,574 

hours for CY 2011. 

Proposed § 440.70(f)(4) and (g)(1) 

would require that physicians document 

the existence of a face-to-face encounter 

with the Medicaid eligible recipient. 

The burden associated with these 

requirements would be the time and 

effort required for the physician to 

complete and maintain this 

documentation. The ordering 

physician’s burden for composing the 

face-to-face documentation, which 

would include determining how the 

clinical findings of the encounter 

support eligibility; writing, typing, or 

dictating the face-to-face 

documentation; signing, and dating the 

recipient’s face-to-face encounter is 

estimated at 10 minutes for each 

encounter. We estimate that there would 

be 1,143,443 initial home health 

episodes in a year based on our 2008 

claims data. As such, the estimated 

burden for the physician documenting, 

signing, and dating the recipient’s faceto-face encounter would be 190,574 

hours for CY 2011. We acknowledge 

that this figure is inflated by the 

instances in which the physician 

himself or herself conducted the face-toface encounter with the individual, 

making this second 10-minute 

documentation burden unnecessary. 

This notice of proposed rulemaking 

also serves as the required 60-day 

Federal Register notification for 

aforementioned information collection 

requirements. To obtain copies of the 

supporting statement and any related 

forms for the proposed paperwork 

collections referenced above, access 

CMS’ Web site at http://www.cms.gov/ 

PaperworkReductionActof1995/PRAL/ 

list.asp#TopOfPage or e-mail your 

request, including your address, phone 

number, OMB number, and CMS 

document identifier, to 

Paperwork@cms.hhs.gov, or call the 

Reports Clearance Office at 410–786– 

1326. 

If you comment on these information 

collection and recordkeeping 

requirements, please do either of the 

following: 

1. Submit your comments 

electronically as specified in the 

ADDRESSES section of this proposed rule; 

or 

2. Submit your comments to the 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, Attention: CMS Desk Officer, 

[CMS–2348–P] Fax: (202) 395–6974; or 

E-mail: OIRA_submission@omb.eop.gov. 

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. Regulatory Impact Statement 

A. Statement of Need 

This regulation is necessary to 

implement Section 6407 of the Patient 

Protection and Affordable Care Act of 

2009 (the Affordable Care Act), (Pub. L. 

111–148, enacted on March 23, 2010), as 

amended by section 10605 of the 

Affordable Care Act which affects the 

home health benefit under both the 

Medicare and Medicaid programs. 

Section 6407(a) of the Affordable Care 

Act (as amended by section 10605) 

added new requirements to section 

1814(a)(2)(C) of the Act under Part A of 

the Medicare program, and section 

1835(a)(2)(A) of the Act, under Part B of 

the Medicare program, that the 

physician, or certain allowed 

nonphysician practitioners (NPPs), 

document a face-to-face encounter with 

the individual (including through the 

use of telehealth, subject to the 

requirements in section 1834(m) of the 

Act), prior to making a certification that 

home health services are required under 

the Medicare home health benefit. 

Section 1814(a)(2)(C) of the Act 

indicates that in addition to a physician, 

a nurse practitioner or clinical nurse 

specialist (as those terms are defined in 

section 1861(aa)(5) of the Act) who is 

working in collaboration with the 

physician in accordance with State law, 

or a certified nurse-midwife (as defined 

in section 1861(gg) of the Act, as 

authorized by State law), or a physician 

assistant (as defined in section 

1861(aa)(5) of the Act), under the 

supervision of the physician, may 

conduct the face-to-face encounters 

prior to the start of home health 

services. 

Section 6407(b) of the Affordable Care 

Act amended section 1834(a)(11)(B) of 

the Act to require documentation of a 

similar face-to-face encounter with a 

physician or specific NPPs by a 

physician ordering durable medical 

equipment (DME). The NPPs authorized 

to conduct a face-to-face encounter on 

behalf of a physician are the same for 

this provision as for the provision 

described above, with one exception. 

Certified nurse-midwives are not 

permitted to conduct the face-to-face 

encounter prior to the physician 

ordering DME. The timing of this faceto-face encounter is specified as being 

within the 6-month period preceding 

the written order for DME, or other 

reasonable timeframe specified by the 

Secretary. This provision also maintains 

the role of the physician in the actual 

ordering of DME. 

B. Overall Impact 

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 (January 18, 

2011), the Regulatory Flexibility Act 

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

354), section 1102(b) of the Social 

Security Act, section 202 of the 

Unfunded Mandates Reform Act of 1995 

(March 22, 1995, Pub. L. 104–4), and 

Executive Order 13132 on Federalism 

(August 4, 1999), and the Congressional 

Review Act (5 U.S.C. 804(2)). 

Executive Orders 12866 and 13563 

direct 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). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. A 

regulatory impact analysis (RIA) must 

be prepared for major rules with 

economically significant effects ($100 

million or more in any 1 year). We 

tentatively estimate that this rulemaking 

may be ‘‘economically significant’’ as 

measured by the $100 million threshold, 

and, therefore, may be a major rule 

under the Congressional Review Act. 

Accordingly, we have prepared a 

Regulatory Impact Analysis which to 

the best of our ability presents the costs 

and benefits of the rulemaking. 

The CMS Office of the Actuary 

estimated Section 6407 as having no 

potential impact on Federal Medicaid 

costs and savings. According to the CMS 

Actuarial estimates, Section 6407 would 

bring an estimated $350 million in 


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41038 Federal Register / Vol. 76, No. 133 / Tuesday, July 12, 2011 / Proposed Rules 

savings to the Medicare program from 

2010–2014 and $870 million in savings 

from 2010–2019. Although this 

provision applies to Medicaid in the 

same manner and to the same extent as 

the Medicare program, no estimates 

(costs or savings) were noted for the 

Medicaid program. 

Although there is no quantitative data 

to arrive at a specific dollar figure to 

attribute to the additional medical 

supplies, equipment, and appliances 

that may now be authorized in 

accordance with § 440.70(b)(3), we 

acknowledge the potential for this 

provision to surpass the threshold for 

economic significance. We wish to note 

however, that this provision may result 

in offsetting benefits to both 

beneficiaries and State budgets, 

including the ability for individuals to 

return to or enter the workforce, thereby 

increasing the pool of taxpayers, and 

decreasing reliance on other Medicaid 

benefits, including institutional care. 

Although there is no specific estimate 

regarding these benefits, they 

nonetheless should be taken into 

account. We are specifically soliciting 

comment on the potential increased 

costs and benefits associated with this 

provision, as well as the various 

sections throughout the RIA. 

The RFA requires agencies to analyze 

options for regulatory relief for small 

entities, 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. Most 

hospitals and most other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues 

of $7.0 million to $34.5 million in any 

1 year. For details, see the Small 

Business Administration’s final rule that 

set forth size standards for health care 

industries, (65 FR 69432, November 17, 

2000). Individuals and States are not 

included in the definition of a small 

entity. We are not preparing an analysis 

for the RFA because the Secretary has 

determined that this proposed rule 

would not have a significant economic 

impact on a substantial number of small 

entities. 

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 603 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 100 

beds. We are not preparing an analysis 

for section 1102(b) of the Act because 

the Secretary has determined that this 

proposed rule would not have a 

significant impact on the operations of 

a substantial number of small rural 

hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act (UMRA) of 1995 

also requires that agencies assess 

anticipated costs and benefits before 

issuing any rule that may result in 

expenditure in any one year of $100 

million in 1995 dollars, updated 

annually for inflation. In 2011, that 

threshold level is approximately $136 

million. This proposed rule will not 

result in an impact of $136 million or 

more on State, local or tribal 

governments, in the aggregate, or on the 

private sector. 

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 Executive Order 

13132 are not applicable. 

C. Conclusion 

We tentatively estimate that this rule 

may be ‘‘economically significant’’ as 

measured by the $100 million threshold 

as set forth by Executive Order 12866, 

as well as the Congressional Review 

Act. The analysis above provides our 

initial Regulatory Impact Analysis. We 

have not prepared an analysis for the 

RFA, section 1102(b) of the Act, section 

202 of the UMRA, and Executive Order 

13132 because the provisions are not 

impacted by this rule. 

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 440 

Grant programs—health, Medicaid. 

For the reasons set forth in the 

preamble, the Centers for Medicare & 

Medicaid Services proposes to amend 

42 CFR chapter IV as set forth below: 

PART 440—SERVICES: GENERAL 

PROVISIONS 

1. The authority citation for part 440 

continues to read as follows: 

Authority: Sec. 1102 of the Social Security 

Act (42 U.S.C. 1302). 

Subpart A—Definitions 

2. Section 440.70 is amended by— 

A. Redesignating paragraphs (b)(3)(i) 

and (ii) as (b)(3)(iii) and (iv), 

respectively. 

B. Revising the introductory text of 

paragraph (b)(3). 

C. Adding new paragraphs (b)(3)(i) 

and (ii). 

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

E. Adding paragraphs (f) and (g). 

The revisions and additions read as 

follows: 

§ 440.70 Home health services. 

* * * * * 

(b) * * * 

(3) Medical supplies, equipment, and 

appliances suitable for use in any noninstitutional setting in which normal 

life activities take place. 

(i) Supplies are defined as health care 

related items that are consumable or 

disposable, or cannot withstand 

repeated use by more than one 

individual. 

(ii) Equipment and appliances are 

defined as items that are primarily and 

customarily used to serve a medical 

purpose, generally not useful to an 

individual in the absence of an illness 

or injury, can withstand repeated use, 

and can be reusable or removable. 

* * * * * 

(c) * * * 

(1) Nothing in this section should be 

read to prohibit a recipient from 

receiving home health services in any 

non-institutional setting in which 

normal life activities take place. 

(2) Additional services or service 

hours may, at the State’s option, be 

authorized to account for medical needs 

that arise in these settings. 

* * * * * 

(f) No payment may be made for 

services referenced in paragraphs (b)(1), 

(2), and (4) of this section, unless the 

physician referenced in paragraph (a)(2) 

of this section documents that there was 

a face-to-face encounter with the 

recipient that meets the following 

requirements: 

(1) For the initiation of services, the 

face-to-face encounter must be related to 

the primary reason the recipient 

requires home health services and must 

occur within the 90 days prior to or 

within the 30 days after the start of the 

services. 

(2) The face-to-face encounter may be 

conducted by one of the following 

practitioners: 

(i) The physician referenced in 

paragraph (a)(2) of this section; 

(ii) A nurse practitioner or clinical 

nurse specialist, as those terms are 

defined in section 1861(aa)(5) of the 

Act, working in collaboration with the 

physician described in paragraph (a) of 


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this section, in accordance with State 

law; 

(iii) A certified nurse midwife, as 

defined in section 1861(gg) of the Act, 

as authorized by State law; 

(iv) A physician assistant, as defined 

in section 1861(aa)(5) of the Act, under 

the supervision of the physician 

described in subparagraph (a) of this 

section; or 

(v) For recipients admitted to home 

health immediately after an acute or 

post-acute stay, the attending acute or 

post-acute physician. 

(3) The allowed nonphysician 

practitioner, as described in paragraph 

(f)(3)(ii) through (iv) of this section, or 

the attending acute or post-acute 

physician, as described in paragraph 

(f)(3)(v) of this section, performing the 

face-to-face encounter must 

communicate the clinical findings of 

that face-to-face encounter to the 

ordering physician. Those clinical 

findings must be incorporated into a 

written or electronic document included 

in the recipient’s medical record. 

(4) To assure clinical correlation 

between the face-to-face encounter and 

the associated home health services, the 

physician responsible for ordering the 

services must: 

(i) Document the face-to-face 

encounter as a separate and distinct area 

on the order itself, as an easily 

identifiable and clearly titled addendum 

to the order, or a separate document 

easily identifiable and clearly titled in 

the recipient’s medical record, to 

describe how the health status of the 

recipient at the time of the face-to-face 

encounter is related to the primary 

reason the recipient requires home 

health services. 

(ii) Must indicate the practitioner who 

conducted the encounter, and be clearly 

titled and dated on the documentation 

of the face-to-face encounter. 

(5) The face-to-face encounter may 

occur through telehealth, as 

implemented by the State. 

(g)(1) No payment may be made for 

medical equipment, supplies, or 

appliances referenced in paragraph 

(b)(3) of this section to the extent that 

a face-to-face encounter requirement 

would apply as durable medical 

equipment under the Medicare program, 

unless the physician referenced in 

paragraph (a)(2) of this section 

documents a face-to-face encounter with 

the recipient consistent with the 

requirements of paragraph (f) of this 

section except as indicated below. 

(2) The face-to-face encounter may be 

performed by any of the practitioners 

described in paragraph (f)(2)of this 

section, with the exception of certified 

nurse-midwives, as described in 

paragraph (f)(2)(iii)of this section. 

(Catalog of Federal Domestic Assistance 

Program No. 93.778, Medical Assistance 

Program). 

Dated: March 2, 2011. 

Donald M. Berwick, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: June 3, 2011. 

Kathleen Sebelius, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2011–16937 Filed 7–5–11; 4:15 pm] 

BILLING CODE 4120–01–P 


srobinson on DSK4SPTVN1PROD with PROPOSALS2