38342 Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 410 

[CMS–1436–P] 

RIN 0938–AR06 

Medicare Program; Clinical Laboratory 

Fee Schedule: Signature on 

Requisition 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

retract the policy adopted in the 

calendar year 2011 Physician Fee 

Schedule final rule with comment 

period that requires the signature of a 

physician or qualified non-physician 

practitioner on a requisition for clinical 

diagnostic laboratory tests paid under 

the Clinical Laboratory Fee Schedule 

(CLFS). In addition, this proposed rule 

would reinstate the prior policy that the 

signature of a physician or qualified 

non-physician practitioner is not 

required on a requisition for Medicare 

purposes for a clinical diagnostic 

laboratory test paid under the CLFS. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below, no later 

than 5 p.m. eastern daylight time (e.d.t.) 

on August 29, 2011. 

ADDRESSES: In commenting, please refer 

to file code CMS–1436–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 instructions for ‘‘submitting a 

comment.’’ 

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–1436–P, P.O. Box 8013, Baltimore, 

MD 21244–8013. 

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–1436–P, Mail 

Stop C4–26–05, 7500 Security 

Boulevard, Baltimore, MD 21244–8013 

4. By hand or courier. Alternatively, 

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– 

1066 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 close of the comment 

period. 

FOR FURTHER INFORMATION CONTACT: 

Glenn McGuirk, (410) 786–5723. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. History and Overview 

In the March 10, 2000 Federal 

Register (65 FR 13082), we published a 

proposed rule entitled ‘‘Medicare 

Program; Negotiated Rulemaking: 

Coverage and Administrative Policies 

for Clinical Diagnostic Laboratory 

Services,’’ to announce and solicit 

comments on the results of our 

negotiated rulemaking committee tasked 

to establish national coverage and 

administrative policies for clinical 

diagnostic laboratory services payable 

under Part B of Medicare. 

In the November 23, 2001 Federal 

Register (66 FR 58788), we published a 

final rule, which established these 

national coverage and administrative 

policies. In that final rule, we explained 

our policy on ordering clinical 

diagnostic laboratory services and 

revised regulatory language in § 410.32. 

Our regulation at § 410.32(a) includes a 

requirement that states ‘‘[a]ll diagnostic 

x-ray tests, diagnostic laboratory tests, 

and other diagnostic tests must be 

ordered by the physician who is treating 

the beneficiary.’’ In the November 23, 

2001 final rule (66 FR 58809), we added 

paragraph (d)(2) to § 410.32 to require 

that the physician or qualified 

nonphysician practitioner (NPP) (that is, 

clinical nurse specialists, clinical 

psychologists, clinical social workers, 

nurse-midwives, nurse practitioners, 

and physician assistants) who orders the 

service must maintain documentation of 

medical necessity in the beneficiary’s 

medical record. In both the March 10, 

2000 proposed rule (65 FR 13089) and 

the November 23, 2001 final rule (66 FR 

58802), we noted that ‘‘[w]hile the 

signature of a physician on a requisition 

is one way of documenting that the 

treating physician ordered the test, it is 

not the only permissible way of 

documenting that the test has been 

ordered.’’ In the preamble of these rules, 

we described the policy of not requiring 

physician signatures on requisitions for 

clinical diagnostic laboratory tests, but 

implicitly left in place the existing 

requirements for a written order to be 

signed by the ordering physician or NPP 

for clinical diagnostic laboratory tests, 

as well as other types of diagnostic tests. 

We further stated, in the March 10, 2000 

proposed rule (65 FR 13089) and the 

November 23, 2001 final rule (66 FR 

58802), that we would publish 

instructions to Medicare contractors 

clarifying that the signature of the 

ordering physician or NPP on a 

requisition for a clinical diagnostic 

laboratory test, is not required for 

Medicare purposes. 

On March 5, 2002, we issued a 

program memorandum (Transmittal 

AB–02–030, Change Request 1998) 

implementing the administrative 

policies set forth in the November 23, 

2001 final rule, including the following 

instruction: 

Medicare does not require the signature of 

the ordering physician on a laboratory 

service requisition. While the signature of a 

physician on a requisition is one way of 

documenting that the treating physician 

ordered the service, it is not the only 

permissible way of documenting that the 

service has been ordered. For example, the 

physician may document the ordering of 

specific services in the patient’s medical 

record. 

On January 24, 2003, we issued a 

program transmittal (Transmittal 1787, 

Change Request 2410) to manualize the 

March 5, 2002 program memorandum. 

The transmittal page stated, ‘‘Section 

15021, Ordering Diagnostic Tests, 

manualizes Transmittal AB–02–030, 

dated March 5, 2002. In accordance 


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Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 38343 

with negotiated rulemaking for 

outpatient clinical diagnostic laboratory 

services, no signature is required for the 

ordering of such services or for 

physician pathology services.’’ In the 

manual instructions in that transmittal 

(that is, Transmittal 1787), we stated in 

a note: ‘‘No signature is required on 

orders for clinical diagnostic tests paid 

on the basis of the physician fee 

schedule or for physician pathology 

services.’’ The manual instructions 

inadvertently omitted the reference to 

clinical diagnostic laboratory tests. 

Thus, the transmittal seemed to extend 

the policy set forth in the November 23, 

2001 final rule (that no signature is 

required on requisitions for clinical 

diagnostic laboratory tests paid under 

the clinical laboratory fee schedule 

(CLFS)) to also apply to clinical 

diagnostic tests paid on the basis of the 

physician fee schedule (PFS) and 

physician pathology services. In 

addition, the manual instructions used 

the term ‘‘order’’ instead of 

‘‘requisition,’’ which some members of 

the industry have asserted caused 

confusion. When we transitioned from 

paper manuals to the current electronic 

Internet Only Manual (IOM) system, 

these manual instructions were 

inadvertently omitted from the new 

Benefit Policy Manual (BPM). 

On August 28, 2008, we issued a 

program transmittal (Transmittal 94, 

Change Request 6100) to update the 

BPM to incorporate language that was 

previously contained in section 15021 

of the Medicare Carriers Manual. The 

reissued language stated, ‘‘No signature 

is required on orders for clinical 

diagnostic tests paid on the basis of the 

clinical laboratory fee schedule, the 

physician fee schedule, or for physician 

pathology services.’’ After the 

publication of the August 2008 Program 

Transmittal (Transmittal 94), we 

received numerous inquiries from 

laboratories, diagnostic testing facilities, 

and hospital representatives who had 

questions about whether the provision 

applied to all diagnostic services, 

including x-rays, magnetic resonance 

imaging (MRIs), and other nonclinical 

laboratory fee schedule diagnostic 

services. 

To resolve any existing confusion 

surrounding the implementation of the 

CLFS policy in 2001 and subsequent 

transmittals, we restated and solicited 

public comments on our policy in the 

July 13, 2009 proposed rule (74 FR 

33641 and 33642), entitled ‘‘Medicare 

Program; Payment Policies Under the 

Physician Fee Schedule and Other 

Revisions to Part B for CY 2010’’ 

(hereinafter referred to as the CY 2010 

PFS proposed rule). At that time, our 

policy was that the signature of a 

physician or NPP was not required on 

a requisition for clinical diagnostic 

laboratory tests paid on the basis of the 

CLFS. However, we were clear that we 

would still require that it must be 

evident, in accordance with our 

regulations at § 410.31(d)(2) and (3), that 

the physician or NPP had ordered the 

services. 

We clarified that this policy regarding 

requisitions for clinical diagnostic 

laboratory tests would not supersede 

other applicable Medicare requirements 

(such as those related to hospital 

conditions of participation (CoPs)), 

which require the medical record to 

include an order signed by the 

physician or NPP who is treating the 

beneficiary. In addition, we stated that 

we did not believe that our policy 

regarding signatures on requisitions for 

clinical diagnostic laboratory tests 

supersedes other requirements 

mandated by professional standards of 

practice or obligations regarding orders 

and medical records promulgated by 

Medicare, the Joint Commission, or 

State law; nor did we believe the policy 

would require providers to change their 

business practices. 

In the CY 2010 PFS proposed rule (74 

FR 33641 and 33642), we also restated 

and solicited public comment on our 

longstanding policy, consistent with the 

principle in § 410.32(a) that a written 

order for diagnostic tests including 

those paid under the CLFS and those 

that are not paid under the CLFS (for 

example, that are paid under the PFS or 

under the OPPS), such as X-rays, MRIs, 

and the technical component (TC) of 

physician pathology services, must be 

signed by the ordering physician or 

NPP. We were clear that the policy that 

signatures are not required on 

requisitions for clinical diagnostic 

laboratory tests paid based on the CLFS 

applied only to requisitions (as opposed 

to written orders). 

Additionally, in the CY 2010 PFS 

proposed rule (74 FR 33642) we 

solicited public comments about the 

distinction between an order and a 

requisition. We noted that an ‘‘order’’ as 

defined in our Internet Only Manual 

(IOM), 100–02, Chapter 15, Section 

80.6.1, is a communication from the 

treating physician or NPP requesting 

that a diagnostic test be performed for 

a beneficiary. The order may 

conditionally request an additional 

diagnostic test for a particular 

beneficiary if the result of the initial 

diagnostic test ordered yields a certain 

value determined by the treating 

physician or NPP (for example, if test X 

is negative, then perform test Y). We 

further clarified in the CY 2010 PFS 

final rule with comment period (74 FR 

61930) that an order may be delivered 

via any of the following forms of 

communication: 

• A written document signed by the 

treating physician or NPP, which is 

hand-delivered, mailed, or faxed to the 

testing facility. 

• A telephone call by the treating 

physician or NPP or his or her office to 

the testing facility. 

• An electronic mail, or other 

electronic means, by the treating 

physician or NPP or his or her office to 

the testing facility. 

If the order is communicated via 

telephone, both the treating physician or 

NPP, or his or her office, and the testing 

facility must document the telephone 

call in their respective copies of the 

beneficiary’s medical records. 

In the CY 2010 PFS proposed rule (74 

FR 33642), we defined a ‘‘requisition’’ 

as the actual paperwork, such as a form, 

which is furnished to a clinical 

diagnostic laboratory that identifies the 

test or tests to be performed for a 

patient. The requisition may contain 

patient information, ordering physician 

information, referring institution 

information, information on where to 

send reports, billing information, 

specimen information, shipping 

addresses for specimens or tissue 

samples, and checkboxes for test 

selection. We believed the requisition 

was ministerial in nature, assisting 

laboratories with the billing and 

handling of results, and serves as an 

administrative convenience to providers 

and patients. We believed that a written 

order, which may be part of the medical 

record, and the requisition, were two 

different documents, although a 

requisition that is signed may serve as 

an order. 

During the public comment period for 

the CY 2010 PFS proposed rule, we 

received numerous comments on these 

issues. Subsequently, in the CY 2010 

PFS final rule with comment period (74 

FR 61931), we stated that we would 

continue to carefully consider the issue 

of physician signatures on requisitions 

and orders and that we planned to 

revisit these issues in the future. 

In the CY 2011 PFS proposed rule (75 

FR 40162 through 40163), we proposed 

to require a physician’s or NPP’s 

signature on requisitions for clinical 

diagnostic laboratory tests paid on the 

basis of the CLFS. We stated that we 

believed this policy would result in a 

less confusing process because a 

physician’s signature would be required 

for all requisitions and orders, 

eliminating the uncertainty over 

whether the documentation is a 

requisition or an order, whether the type 


srobinson on DSK4SPTVN1PROD with PROPOSALS
38344 Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 

of test being ordered requires a 

signature, or which payment system 

does or does not require a physician’s or 

NPP’s signature. We also stated that we 

believed the requirement would not 

increase the burden on physicians and 

would be easier for the reference 

laboratory technicians to know whether 

a test is appropriately requested, which 

would minimize potential compliance 

problems for laboratories during the 

course of a subsequent Medicare audit 

because a signature would be 

consistently required. We solicited 

public comments on the CY 2011 PFS 

proposed rule. 

After careful consideration of all the 

comments received, we finalized our 

proposed policy without modification to 

require a physician’s or NPP’s signature 

on requisitions for clinical diagnostic 

laboratory tests paid under the CLFS in 

the CY 2011 PFS final rule with 

comment period (75 FR 73483), which 

became effective on January 1, 2011. 

This policy did not affect physicians or 

NPPs who chose not to use requisitions 

to request clinical diagnostic laboratory 

tests paid under the CLFS. Such 

physicians or NPPs could continue to 

request such tests by other means, such 

as by using the annotated medical 

records, documented telephonic 

requests, or electronic requests. 

II. Provisions of the Proposed Rule 

In this proposed rule, we would 

retract the policy we finalized in the CY 

2011 PFS final rule with comment 

period (75 FR 73483) and reinstate the 

prior policy that the signature of the 

physician or NPP is not required on a 

requisition for Medicare purposes for a 

clinical diagnostic laboratory test paid 

under the CLFS. We are proposing this 

policy based on continued and new 

concerns noted by stakeholders 

regarding the practical effect of the 

finalized policy on beneficiaries, 

physicians, and NPPs. 

While we did not solicit further 

comments on the signature on 

requisition issue in the CY 2011 PFS 

final rule with comment period, we did 

receive additional feedback from 

industry stakeholders on the issue after 

its publication in the Federal Register. 

Industry stakeholders identified many 

scenarios where it would be difficult to 

obtain the physician’s or NPP’s 

signature on the requisition for clinical 

diagnostic laboratory tests under the 

CLFS. Industry stakeholders asserted 

that there are many different situations 

where the physician or NPP would 

direct staff to prepare requisitions for 

laboratory tests, but then would be 

unavailable to provide his or her 

signature on the requisition. As an 

example, and one that was raised by 

commenters to the CY 2011 PFS 

proposed rule, in the long-term care 

setting, the physician is typically not 

available in person on a daily basis. In 

these cases, the physician may keep 

abreast of the patient’s condition by 

calling the nursing staff. If a patient’s 

condition indicates that a clinical 

diagnostic laboratory test is required, 

the nursing staff typically transcribes 

the order from the physician over the 

telephone onto a requisition. The 

information has to be transmitted to the 

laboratory and, in this scenario, there is 

no physician’s or NPP’s signature on the 

requisition. Another example that 

occurs in many settings, including 

nursing homes, all types of hospitals 

(inpatient as well as outpatient), and 

physician offices, involves specimens 

that are packaged for transmission to the 

laboratory with a requisition by nursing 

staff. Because the specimen often is 

transferred directly from the patient to 

the nursing staff without, in most cases, 

a physician’s or NPP’s intervention, the 

requisition that accompanies the 

specimen does not bear the signature of 

the physician or NPP. 

Even in cases where the physician or 

NPP sees the patient in his/her offices 

for an appointment and recommends 

that clinical diagnostic laboratory 

testing be performed, we now better 

understand that, typically, the 

information is transcribed from the 

medical record onto a paper requisition 

by office staff after the physician or NPP 

and the patient have concluded their 

interaction. In practice, we can see how 

requiring the physician or NPP to sign 

the paper requisition could, in some 

cases, be very inconvenient and 

disruptive to the physician, NPP, the 

beneficiary, and other patients. The 

physician or NPP may need to take time 

either during appointments with 

subsequent patients or between patient 

appointments to make sure that the 

requisition is signed for a particular 

patient prior to his/her departure from 

the office. In addition, a beneficiary 

might have to wait for a physician or 

NPP to complete the requisition 

signature process before the beneficiary 

could depart from the office. 

Another situation identified by 

industry stakeholders that we did not 

previously consider concerns 

physicians or NPPs who maintain 

several practice locations. A patient may 

see his or her physician or NPP only at 

one particular practice location. If that 

patient presents to the practice location 

with a medical issue that the physician 

or NPP believes warrants immediate 

laboratory testing, but the physician or 

NPP is physically at a different location 

that day, the physician or NPP may be 

able to direct his or her nursing staff to 

prepare a requisition for the laboratory 

test. But, if the physician or NPP must 

sign the requisition, there could be a 

delay of several days or longer, before 

the physician or NPP is able to do so, 

which means the patient would have to 

wait to have the laboratory test 

performed. 

The aforementioned scenarios have 

detrimental implications for expeditious 

patient care that were not evident to us 

until the new policy was effectuated 

and we started hearing from 

stakeholders in the industry that would 

be negatively impacted by the policy. In 

response to a comment suggesting that 

physicians be educated about this new 

requirement to alleviate problems of 

non-compliance, we stated, in the CY 

2011 PFS final rule with comment 

period (75 FR 73482), that we would 

update our manuals and direct the 

Medicare contractors to educate 

physicians and NPPs on this policy. 

After publication of the CY 2011 PFS 

final rule with comment period, it 

became even clearer to us that some 

physicians, NPPs, and clinical 

diagnostic laboratories were not aware 

of, or did not understand, the policy. 

Therefore, in the first calendar quarter 

of 2011, we focused on developing 

educational and outreach materials to 

educate those affected by this policy. 

Further, we issued a statement that, 

once the first quarter of 2011 

educational campaign is fully 

underway, we would expect 

requisitions to be signed. While 

developing educational and outreach 

materials, we realized how difficult and 

burdensome the actual implementation 

of this policy was for physicians and 

NPPs and that, in some cases, the 

implementation of this policy could 

have a negative impact on patient care. 

At that point, we decided that the better 

course of action was to re-examine the 

policy. 

We re-examined our policy and our 

reasons for adopting this policy in light 

of industry stakeholders’ comments 

received after publication of the CY 

2011 PFS final rule with comment 

period and comments received on the 

CY 2011 PFS proposed rule. We 

reviewed our beliefs and assumptions 

regarding the effect of our policy on 

access to care and with respect to 

administrative burden on physicians 

and NPPs, the effect on innovation, and 

the impact on laboratories. We believed 

that the policy would not have a 

negative impact on beneficiary access to 

care. However, we now believe that we 

underestimated the potential impact on 

beneficiary health and safety. As 


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Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 38345 

discussed previously, care may be 

delayed under this policy in situations 

where the physician or NPP orders the 

test but is not available onsite to sign 

the requisition. For example, we 

understand there are concerns that 

certain populations of patients, such as 

nursing home patients and patients 

confined to their homes, may have 

laboratory tests ordered urgently by a 

distant physician or NPP to obtain 

information that is imminently needed 

in order to assess a need for immediate 

referral to a hospital, emergency 

department or other facility. If the 

ordering physician or NPP is not onsite, 

it is unlikely that he or she would be 

able to receive, sign, and return a 

requisition in the timeframe needed to 

respond to the patient’s urgent clinical 

status. We had not anticipated this 

impact on care when we finalized our 

policy. 

We also believed that the 

administrative burden on physicians 

and NPPs would be minimal and would 

result in a less confusing process. 

Physicians and NPPs must document 

their orders, in some form, in one or 

more of the medical records of the 

patient. We still believe that signing a 

laboratory requisition at the time of the 

order, if the requisition is ready for 

signature, imposes little burden on the 

physician or NPP, while significantly 

increasing our ability to minimize 

improper payments due to fraud and 

abuse. However, we believe we may 

have underestimated the number of 

occasions in which the physician or 

NPP cannot perform both steps 

concurrently. We now understand that 

it is not always the case that a physician 

or NPP can perform both steps 

concurrently. For instance, a physician 

may sign an order at the time of 

delivering care, but the requisition may 

not be available for signature until 

sometime later. In that situation, the 

physician may need to interrupt a 

subsequent examination in order to sign 

a completed requisition so that the 

patient may leave with the requisition. 

Given recently released estimates of 

physician shortfalls in primary care (as 

referenced in remarks by the Health 

Resources and Services Administration 

(HRSA) Administrator to the Bureau of 

Health Professions Advisory Committee 

on April 21, 2009), the cost of lost 

physician time must also be revalued 

upwards. Alternatively, the beneficiary 

may have to wait for the physician or 

NPP to conclude his/her subsequent 

appointment, which could be as long as 

30 minutes or more. Neither of these 

situations—interrupting the physician 

or NPP in a subsequent appointment or 

making the beneficiary wait for an 

inconvenient period of time—is 

acceptable. Further, we believed that the 

policy resulted in a less confusing 

process because a physician or NPP 

signature would be required for all 

requisitions and orders, eliminating 

uncertainty over whether the 

documentation is a requisition or an 

order, whether the type of test being 

ordered requires a signature, or which 

payment system does nor does not 

require a physician or NPP signature. 

However, based on industry stakeholder 

comments subsequent to the publication 

of the CY 2011 PFS final rule with 

comment period, we now believe this 

process may not be less confusing. 

Further, industry stakeholders assured 

us that they had not been confused 

about the former physician signature 

policy and that they never intended for 

us to interpret their call for consistency 

in the signature process to mean that 

they should be burdened with an 

additional requirement when they were 

already signing the medical record. 

In addition, we believed that many 

stakeholders either had converted or 

were in the process of converting to an 

electronic health records process that 

would negate the need for a requisition. 

Electronic health records and electronic 

transmission of health information are 

key pieces of this Administration’s 

economic recovery plan and, moreover, 

are key elements of our plan to improve 

healthcare quality and efficiency. From 

the additional stakeholder concerns 

subsequent to our CY 2011 PFS final 

rule with comment period, we are 

sensitive to the increasing migration of 

information transfer away from paper 

forms, such as requisitions, to the direct 

electronic submission of requests for 

services. After we adopted the new 

policy, stakeholders expressed their 

concerns that the requirement for a 

signature would increase paperwork, in 

direct opposition to our promotion of 

time-saving electronic communications. 

We believe that the requirement for a 

signature on the requisition does not 

impact stakeholders who utilize an 

electronic process for ordering clinical 

diagnostic laboratory tests because the 

policy only applies to requisitions, 

which are paper forms. Our intent was 

not to suggest that a requisition was 

necessary in those cases. However, we 

recognize that members of the provider 

and supplier community believe that 

this regulation could inhibit their use of 

innovative technology and investment 

in healthcare IT resources even after we 

explained the issue. Therefore, we 

underestimated the potential for 

paperwork burden. 

Finally, we believed that the policy 

would make it easier for a reference 

laboratory to know whether a test is 

appropriately requested and to 

minimize potential compliance 

problems. Specifically, we believe that 

the policy improves a laboratory’s 

ability to authenticate requisitions. 

While we still believe this is true, based 

on industry stakeholder concerns 

received after the CY 2011 PFS final 

rule with comment period, which 

elaborated on comments submitted in 

response to the CY 2011 PFS proposed 

rule (75 FR 40161 through 40163), we 

now believe our estimate of the 

financial benefit of this aspect of the 

policy is less than we originally 

believed, because the percentage of 

laboratory requests actually covered by 

this policy may be smaller than we 

originally predicted and may continue 

to shrink as new technology is adopted. 

We also believed the policy provided a 

mechanism for laboratories to fulfill 

their responsibility to ensure that they 

only provide and bill for services on the 

direct order of a physician or NPP as the 

signature on the requisition would 

provide documentation and evidence 

that the physician or NPP had ordered 

the service. However, industry 

stakeholders expanded on comments to 

the CY 2011 PFS proposed rule and 

informed us that there was a cost to 

adopting a rigid mechanism of 

establishing authenticity. Laboratories 

believe that it is more efficient for them 

to use internal procedures and controls 

to ensure that they do not provide and 

bill for services in the absence of a 

physician authorization rather than 

through a Federal policy. We believe 

that the benefits expected may be lower 

than we originally estimated. 

In summary, there were many 

situations that we could not recognize 

as problematic until we finalized the 

new policy and stakeholders began to 

implement. Upon review of the 

concerns that industry stakeholders 

raised after we finalized our policy in 

the CY 2011 PFS final rule with 

comment period, and in reconsideration 

of comments to the CY 2011 PFS 

proposed rule, we propose to retract the 

policy that was finalized in the CY 2011 

PFS final rule with comment period, 

which required a physician’s or NPP’s 

signature on a requisition for clinical 

diagnostic laboratory tests paid under 

the CLFS (75 FR 73483) and we propose 

to reinstate our prior policy that the 

signature of the physician or NPP is not 

required on a requisition for a clinical 

diagnostic laboratory test paid under the 

CLFS for Medicare purposes. 

We remain concerned about the costs 

and impact of fraud and abuse on the 


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38346 Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 

Medicare program. The requirement that 

the treating physician or NPP must 

document the ordering of the test 

remains, as does our longstanding 

policy that requires orders, including 

those for clinical diagnostic laboratory 

tests, to be signed by the ordering 

physician or NPP. We believe that all 

parties share in the responsibility of 

ensuring that Medicare services are 

provided only in accordance with all 

applicable statutes and regulations, such 

as the requirement for a physician or 

NPP order. In many instances, such as 

in the case of orders originating in 

hospitals, we believe that retaining all 

the other requirements previously 

discussed, especially requiring the 

physician or NPP who orders the service 

to maintain documentation of medical 

necessity in the beneficiary’s medical 

record according to § 410.32(d)(2)(i), as 

well as the hospital CoPs on medical 

record services at § 482.24, are 

sufficient. However, we note that 

hospital CoPs do not apply to other 

settings, such as private offices. 

We believe that it is the responsibility 

of the clinical diagnostic laboratory, as 

it is for the provider of any service, to 

have sufficient processes and safeguards 

in place to ensure that all services are 

delivered only when ordered by the 

physician or NPP. This proposed rule 

does not preclude an individual 

laboratory from requiring a physician’s 

or NPP’s signature on the requisition. 

The laboratory may develop its own 

compliance procedures to ensure that it 

only furnishes services in response to a 

physician or NPP order. Such 

procedures could include internal 

audits, agreements with ordering 

physicians or NPPs to provide medical 

record evidence of the order in the event 

of an internal or external audit, steps to 

confirm the existence of an order under 

certain circumstances, or any other 

measures including the acceptance of 

risk by the clinical laboratory. We 

believe that this financial and 

compliance responsibility was implicit 

in the 2001 final rule (66 FR 58788), was 

reiterated in the March 5, 2002 

transmittal (Change Request 2410, 

Transmittal AB–02–030), and has 

remained a consistent element of the 

subsequent instructions. 

III. Collection of Information 

Requirements 

This document does not impose 

information collection and 

recordkeeping requirements. 

Consequently, it need not be reviewed 

by the Office of Management and 

Budget under the authority of the 

Paperwork Reduction Act of 1995. 

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 

We have examined the impact of this 

proposed 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), 

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) or that 

adversely affect, in a material way, the 

economy, a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local, or tribal government or 

communities. There are no expenditures 

or fiscal impact on the Medicare 

program associated with the policy 

discussed in this proposed rule. While 

the policy that is proposed for 

reinstatement in this proposed rule may 

have an effect on beneficiaries, we 

believe that any effect would be positive 

as we are changing a requirement that 

might have impeded access to care in 

some cases. There are no proposed 

policies in this proposed rule that 

impact payment rates under the clinical 

laboratory fee schedule, or any other 

part of the Medicare program. Therefore, 

for the change in policy regarding the 

physician’s or NPP’s signature on 

requisitions for clinical diagnostic 

laboratory tests paid under the CLFS, 

this proposed rule does not reach the 

economic threshold and thus is not 

considered a major rule. 

The RFA requires agencies to analyze 

options for regulatory relief of 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 

governmental jurisdictions. Many 

hospitals and many other providers and 

suppliers are small entities, either by 

nonprofit status or by meeting the Small 

Business Administration (SBA) 

definition of a small business. 

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, if 

finalized, would not have a significant 

economic impact on a substantial 

number of small entities. 

In addition, section 1102(b) of the 

Social Security Act (the 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. With the 

exception of hospitals located in certain 

New England counties, for purposes of 

section 1102(b) of the Act, we define a 

small rural hospital as a hospital that is 

located outside of an urban area and has 

fewer than 100 beds. Section 601(g) of 

the Social Security Amendments of 

1983 (Pub. L. 98–21) designated 

hospitals in certain New England 

counties as belonging to the adjacent 

urban areas. Thus, for our purposes, we 

continue to classify these hospitals as 

urban hospitals. We are not preparing 

an analysis for section 1102(b) of the 

Act because the Secretary has 

determined that this proposed rule, if 

finalized, 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 of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule whose mandates require spending 

in any 1 year of $100 million in 1995 

dollars, updated annually for inflation. 

In 2011, that threshold is approximately 

$136 million. This proposed rule, if 

finalized, would have no consequential 

effect on State, local, or tribal 

governments or the private sector. 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a 


srobinson on DSK4SPTVN1PROD with PROPOSALS
Federal Register / Vol. 76, No. 126 / Thursday, June 30, 2011 / Proposed Rules 38347 

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 proposed regulation does not 

impose any costs on State or local 

governments, the requirements of 

Executive Order 13132 are not 

applicable. 

In accordance with the provisions of 

Executive Order 12866, this proposed 

rule was not reviewed by the Office of 

Management and Budget. 

(Catalog of Federal Domestic Assistance 

Program No. 93.773, Medicare—Hospital 

Insurance; and Program No. 93.774, 

Medicare—Supplemental Medical Insurance 

Program) 

Dated: June 2, 2011. 

Donald M. Berwick, 

Administrator, Centers for Medicare & 

Medicaid Services. 

Approved: June 24, 2011. 

Kathleen Sebelius, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2011–16366 Filed 6–29–11; 8:45 am] 

BILLING CODE 4120–01–P 


srobinson on DSK4SPTVN1PROD with PROPOSALS