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###### Department of Health and Human Services

###### Centers for Medicare & Medicaid Services 

          - [CMS-6040-N] 

# AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS. 

# ACTION:

Notice. 

# SUMMARY:

This notice informs independent accreditation organizations of an opportunity to submit an application to participate in the durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) accreditation program. DMEPOS accreditation is required for DMEPOS suppliers. This notice contains information on how to apply for CMS approval. 

# DATES:

                        Applications will be considered if received at the appropriate address, provided in the                         **ADDRESSES**                         section, no later than 5 p.m. d.s.t, on October 2, 2006.                     

# ADDRESSES:

Applications should be sent to: Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244. Mail stop C3-02-16, Attention: Sandra Bastinelli. 

# FOR FURTHER INFORMATION CONTACT:

Sandra Bastinelli, (410) 786-3630. 

# SUPPLEMENTARY INFORMATION:

## I. Background 

Section 302(a)(1) of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) (Pub. L. 108-173) added section 1834(a)(20) of the Social Security Act (the Act) and requires the Secretary to establish and implement quality standards for suppliers of certain items, including consumer service standards, to be applied by recognized independent accreditation organizations. Suppliers of DMEPOS must comply with the quality standards to furnish any item for which payment is made under Medicare Part B, and to receive and retain a provider or supplier billing number used to submit claims for reimbursement for any such item for which payment may be made under Medicare. Section 1834(a)(20)(D) of the Act requires us to apply these quality standards to suppliers of the following items for which we deem the standards to be appropriate: 
    - Covered items, as defined in section 1834(a)(13) of the Act, for which payment may be made under section 1834(a) of the Act.
    - Prosthetic devices, orthotics, and prosthetics described in section 1834(h)(4) of the Act.
    - Items described in section 1842(s)(2) of the Act, which include medical supplies; home dialysis supplies and equipment; therapeutic shoes; parenteral and enteral nutrients, equipment, and supplies; electromyogram devices; salivation devices; blood products; and transfusion medicine.

                    Section 1834(a)(20)(E) of the Act explicitly authorizes the Secretary to establish the quality standards by program instruction to ensure that suppliers that wish to participate in                           ( print page 47231)                        competitive bidding will know what standards they must meet to be awarded a contract. The standards will be applied prospectively and will be published on our Web site. Section 1847(b)(2)(A)(i) of the Act requires a DMEPOS supplier to meet the quality standards specified by the Secretary under section 1834(a)(20) of the Act before being awarded a contract under the Medicare DMEPOS Competitive Bidding Program.                 

Section 1834(a)(20)(B) of the Act requires the Secretary, notwithstanding section 1865(b) of the Act, to designate and approve one or more independent accreditation organizations to apply the quality standards to suppliers of DMEPOS and other items. For most providers and suppliers, the Medicare program currently contracts with State Agencies to perform survey and review functions for such providers and suppliers to approve their participation in or coverage under the Medicare program. Additionally, section 1865(b) of the Act sets forth the general procedures for CMS to approve non-DMEPOS national accreditation organizations. CMS deems providers or suppliers to have met Medicare conditions of participation or coverage if they are accredited by a national accreditation organization approved by CMS. 

We are responsible for the oversight and monitoring of the State Agencies and the approved accreditation organizations. The procedures implemented by the Secretary for designating private and national accreditation organizations for non-DMEPOS national accreditation organizations and the Federal review process for such accreditation organizations are located at 42 CFR part 422 (for Medicare Advantage organizations) and part 488 (for most providers and suppliers). 

## II. Provisions of the Notice 

This notice solicits applications from any independent accreditation organization that has the ability to accredit at least one of the supplier categories identified by the National Supplier Clearinghouse. 

### A. Eligible Organizations 

                    Any independent accreditation organization that can show evidence of the ability to accredit at least one supplier category, as identified by the National Supplier Clearinghouse, and within the time frames set forth by CMS, is eligible to apply. Information on the National Supplier Clearinghouse can be found at                     *http://www.palmettogba.com.*

### B. Application Requirements 

To be considered for approval of deeming authority for Medicare requirements under § 424.58, an independent accreditation organization must furnish to CMS all of the following information: 

(1) A list of the types of DMEPOS suppliers, and a list of products and services for which the organization is requesting approval. 

(2) A description of the duration of accreditation. 

(3) A detailed comparison of the organization's accreditation requirements and standards with the applicable Medicare DMEPOS quality standard requirements such as a crosswalk. 

(4) A detailed description of the organization's survey process, including— 
    - Frequency of the surveys performed.
    - Procedures for performing unannounced surveys.
    - Copies of the organization's survey forms, guidelines and instructions to surveyors.
    - A description of the accreditation survey review process and the accreditation status decision-making process, including the process for addressing deficiencies identified with the accreditation requirements, and the procedures used to monitor the correction of deficiencies found during an accreditation survey.
    - Policies and procedures used when an organization has a dispute regarding survey findings or an adverse decision.
    - Procedures for coordinating surveys with another accrediting organization if the organization does not accredit all products the supplier provides.

(5) Detailed information about the individuals who perform surveys for the accreditation organization including— 
    - The size and composition of accreditation teams for each type of provider and supplier accredited.
    - The education and experience requirements surveyors must meet.
    - The content and frequency of the in-service training provided to survey personnel.
    - The evaluation systems used to monitor the performance of individual surveyors and survey teams.
    - Policies and procedures regarding an individual's participation in the survey or accreditation decision process of any organization with which the individual is professionally or financially affiliated.

(6) A description of the organization's data management and analysis system for its surveys and accreditation decisions, including the kinds of reports, tables, and other displays generated by that system. 

(7) The organization's procedures for responding to and for the investigation of complaints against accredited facilities, including policies and procedures regarding coordination of these activities with appropriate licensing bodies (that is, National Supplier Clearinghouse, CMS, and ombudsman programs). 

(8) The organization's policies and procedures for the withholding or removal of accreditation status for facilities that fail to meet the accreditation organization's standards or requirements, and other actions taken by the organization in response to noncompliance with its standards and requirements. These policies and procedures must include notifying CMS of facilities that fail to meet the requirements of the accrediting organization. 

(9) A description of all types and categories of accreditation offered by the organization, the duration of each type and category of accreditation, and a statement specifying the types and categories of accreditation for which approval of deeming authority is sought. 

(10) A list of all currently accredited suppliers, the type and category of accreditation currently held by each supplier, and the expiration date of each supplier's current accreditation. 

(11) A list of all accreditation surveys scheduled to be performed by the organization. 

(12) A plan for reducing the burden and cost of accreditation to small suppliers. 

The accreditation organization must also submit the following supporting documentation: 

(1) A written presentation that demonstrates the organization's ability to furnish CMS with electronic data in ASCII comparable code. 

(2) A resource analysis that demonstrates that the organization's staffing, funding, and other resources are adequate to perform the required surveys and related activities. 

(3) A statement acknowledging that, as a condition for approval of deeming authority, the organization will agree to— 
    - Prioritize surveys for those suppliers in the 10 Metropolitan Statistical Areas (MSAs) that need to bid in late 2007.
    - Prioritize surveys for those suppliers in the 80 MSAs that need to bid in early 2008.
    - Consider any previous accreditation, certification, and/or licensure findings that indicate that       ( print page 47232)                          DMPOS quality standards are being met at the time the accreditation organization surveys the supplier.                 
    - Use a streamlined process that considers only compliance with CMS' DME quality standards.
    - Notify CMS, in writing, of any supplier that had its accreditation revoked, withdrawn, revised, or any other remedial or adverse action taken against it by the accreditation organization within 30 calendar days of any such action taken.
    - Notify all accredited suppliers within 10 calendar days of CMS' withdrawal of the organization's approval of deeming authority.
    - Notify CMS, in writing, at least 30 calendar days in advance of the effective date of any proposed changes in accreditation requirements.
    - Submit to CMS, within 30 calendar days of a change in CMS requirements, an acknowledgement of CMS' notification of the change, as well as a revised crosswalk reflecting the new requirements, and inform CMS about how the organization plans to alter its requirements to conform to CMS' new requirements.
    - Permit its surveyors to serve as witnesses if CMS takes an adverse action based on accreditation findings.
    - Notify CMS, in writing, within 2 calendar days of a deficiency identified in any accreditation entity where the deficiency poses an immediate jeopardy to the entity's beneficiaries or a hazard to the general public.
    - Provide, on an annual basis, summary data specified by CMS that relates to the past years' accreditations and trends.
    - Attest that the organization will not perform any DMEPOS accreditation surveys of Medicare participating suppliers with which it has a financial relationship with or interest.
    - Conform accreditation requirements to changes in Medicare requirements.

If CMS determines that additional information is necessary to make a determination for approval or denial of the accreditation organization's application for deeming authority, the organization will be notified and afforded an opportunity to provide the additional information. CMS may visit the organization's offices to verify representations made by the organization in its application, including, but not limited to, review of documents and interviews with the organization's staff. The accreditation organization will receive a formal notice from CMS stating whether the request for deeming authority has been approved or denied, the rationale for any denial and reconsideration, and reapplication procedures. CMS will make every effort to issue a final decision no more than 30 days from the time the completed application is received by CMS. 

An accreditation organization may withdraw its application for approval of deeming authority at any time before the formal notice of approval is received. An accreditation organization that has been notified that its request for deeming authority has been denied may request reconsideration in accordance with § 488.201 through § 488.211 in Subpart D. Any accreditation organization whose request for approval of deeming authority has been denied may resubmit its application if the organization: (1) Revises its accreditation program to address the rationale for denial of its previous request; (2) provides reasonable assurance that its accredited companies meet applicable Medicare requirements; and (3) resubmits the application in its entirety. If an accreditation organization has requested a reconsideration of CMS's determination that its request for deeming approval is denied, it may not submit a new application for deeming authority for the type of provider or supplier that is at issue in the reconsideration until the reconsideration is final. 

### C. Evaluation of Proposals 

A panel consisting of subject matter experts will evaluate the proposals using criteria already established by CMS in the survey and certification process. The deadline for the submission of proposals is October 2, 2006. 

## III. Collection of Information Requirements 

The preamble of this notice discusses the information collection requirements associated with DMEPOS supplier accreditation from independent accrediting bodies. An independent accreditation organization must furnish to CMS all of information in the 12 items listed in section II.B. of this notice. In addition, each organization must also submit all of the necessary supporting documentation. This information is necessary to give the independent accreditation organizations the opportunity to submit proposals to implement and operate the DMEPOS accreditation programs. DMEPOS accreditation is required for DMEPOS suppliers that wish to bill Part B. The information supplied by the independent accreditation organizations will be used to evaluate the accreditation organizations ability to meet CMS' regulations. 

The burden associated with this information collection requirement is the time and effort required to document, compile, and submit the necessary application information to CMS. We estimate that 10 entities will submit the application information to CMS in order to be deemed independent accrediting bodies. We also estimate that it will take each of the entities approximately 20 hours to comply with this requirement for an annual total of 200 burden hours. 

                    The aforementioned information collection requirements have been submitted to the Office of Management and Budget (OMB) for emergency approval with a 10-day public comment period. In the August 4, 2006                     **Federal Register**                     (71 FR 44300), we published a notice announcing the request for emergency approval of the information collection requirements. These requirements are not effective until they have been approved by OMB.                 

Authority:Section 1834(a)(20) of the Social Security Act (42 U.S.C. 1395m(a)(20)).

(Catalog of Federal Domestic Assistance Program No. 93.773 Medicare—Hospital Insurance Program; and Program No. 93.774, Medicare—Supplementary Medical Insurance Program)

Dated: July 25, 2006. 

Mark B. McClellan, 

Administrator, Centers for Medicare & Medicaid  Services.

[FR Doc. 06-6933 Filed 8-10-06; 4:01 pm] 

BILLING CODE 4120-01-P