19722 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Health Care Financing Administration

42 CFR Parts 405 and 486

[BPD–646–FC]

RIN 0938–AE48

Medicare and Medicaid Programs;

Conditions of Coverage for Organ

Procurement Organizations (OPOs)

AGENCY: Health Care Financing

Administration (HCFA), HHS.

ACTION: Final rule with comment period.

SUMMARY: This final rule with comment

period sets forth changes to the

conditions of coverage for organ

procurement organizations (OPOs). It

provides for exceptions to the OPO

qualification and performance standards

under certain circumstances, revises the

methodology for counting organs, and

extends the period for interim OPO

designations and notification of

termination. It also adds new

regulations relating to hospitals that

change OPO designations when there is

a change in the OPO service area.

This final rule with comment period

modifies conditions of coverage

previously set forth in an interim final

rule. These changes are being made in

response to public comments received

on that interim rule. New regulations

contained in this final rule implement

provisions of the Social Security Act

Amendments of 1994.

DATES: Effective date: This final rule is

effective May 31, 1996.

Comment date: Written comments on

the definition of ‘‘donor’’ (Section VI of

the preamble) or the hospital waiver

process (XI of the preamble) will be

considered if we receive them at the

appropriate address, as provided below,

no later than 5 p.m. on July 1, 1996.

ADDRESSES: Mail written comments

(One original and three copies) to the

following address: Health Care

Financing Administration, Department

of Health and Human Services,

Attention: BPD–646–FC, P.O. Box 7518,

Baltimore, MD 21207–0518.

If you prefer, you may deliver your

written comments (one original and

three copies) to one of the following

addresses: Room 309–G, Hubert H.

Humphrey Building, 200 Independence

Avenue SW., Washington, DC or Room

C5–09–26, 7500 Security Boulevard,

Baltimore, MD.

Due to staffing and resource

limitations, we cannot accept comments

by facsimile (FAX) transmission. In

commenting, please refer to file code

BPD–646–FC. Comments received

timely will be available for public

inspection as they are received,

generally beginning approximately 3

weeks after publication of a document,

in Room 309–G of the Department’s

offices at 200 Independence Avenue

SW., Washington, DC, on Monday

through Friday of each week from 8:30

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

See section XV of this preamble for

special instructions regarding the

submission of comments and

recommendations regarding the

information collection requirements

contained in these regulations.

FOR FURTHER INFORMATION CONTACT:

Jackie Sheridan, (410) 786–4635.

SUPPLEMENTARY INFORMATION:

I. Background

A. Legislative History

Medicare coverage of services

furnished to individuals with end-stage

renal disease who require dialysis or

kidney transplantation is authorized

under section 1881 of the Social

Security Act (the Act). Medicare also

covers certain other organ transplants

that HCFA has determined are

‘‘reasonable and necessary’’ under

section 1862 of the Act, and pays for

those transplants and related organ

procurement services.

Under the Medicaid program,

payment is made for ‘‘medical

assistance’’ as defined in section 1905(a)

of the Act and in our regulations at 42

CFR Part 440. Each State has a

considerable degree of flexibility to

supplement Medicaid-required services

with optional services the State elects in

its State plan. States must pay Medicare

coinsurance and deductible amounts for

transplant services for ‘‘qualified

Medicare beneficiaries,’’ and must pay

for transplant services to individuals

under the age of 21 who receive early

and periodic screening, diagnostic, and

treatment services. In addition, States

may pay for other transplant services

based on written standards which

provide that similarly situated

individuals are treated alike.

Payment may be made under the

Medicare and Medicaid programs for

organ procurement costs attributable to

payments to an organ procurement

organization (OPO) only if the

organization has been designated by the

Secretary as meeting the conditions for

coverage as an OPO. OPOs are generally

paid indirectly for organ procurement

costs. Usually, the transplanting

hospital pays those costs to the OPO

and claims them on its cost report. An

OPO, however, does have to file a cost

report with us at the end of its fiscal

year. At that time, we settle any

overpayments or underpayments with

the OPO.

Section 1138(b) of the Act sets forth

the statutory qualifications and

requirements that an OPO must meet for

coverage of the costs of its services in

procuring organs for hospitals under the

Medicare and Medicaid programs.

Title IV of the Health Omnibus

Programs Extension Act of 1988 (Public

Law 100–607) contained the Transplant

Amendments Act of 1988. This Act

contained amendments to section 371 of

the Public Health Service Act (PHS Act)

(42 U.S.C. 273), which defines OPOs.

Specifically, section 402(c)(1)(A) of

Public Law 100–607 amended section

371(b)(1)(E) of the PHS Act by revising

the definition of ‘‘service area’’ that

must be encompassed by an OPO.

Public Law 101–274, enacted on April

23, 1990, postponed until January 1,

1992, the effective date of section

402(c)(1)(A) of Public Law 100–607.

Additional legislation regarding the

definition of a service area was included

in the Transplant Amendments Act of

1990 (Public Law 101–616). The details

of these provisions are discussed under

section II ‘‘Service Area’’ of this

preamble.

Section 201(d)(1) of Public Law 101–

616 redesignated section 371(b)(2) of the

PHS Act as section 371(b)(3). That

section sets forth the functions of an

OPO. However, the Congress did not

amend two textual references in section

371(b)(1) to the OPO functions formerly

specified in paragraph (2). Since that

was clearly an oversight and failure to

read the section 371(b)(1) text as if those

‘‘paragraph (2)’’ references had been

changed to ‘‘paragraph (3)’’ would make

part of the statute meaningless, we are

using the corrected references in this

document.

Additional legislation regarding OPOs

was included in section 155 of the

Social Security Amendments of 1994

(Public Law 103–432, enacted on

October 31, 1994). This legislation

amended section 1138(a)(1) of the Act to

require a hospital to have an agreement

for notification of potential organ

donation only with the OPO designated

for the area in which the hospital is

located. Because this legislation was

passed after our issuance of proposed

and interim final rules in 1991 and 1994

respectively to implement statutory

provisions, we did not include any

revisions regarding this subject in those

publications. We are, however,

including revisions to the regulations in

this final rule to reflect the provisions

of Public Law 103–432. These
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19723

provisions are discussed under section

XI. ‘‘Waiver of Service Area

Designations’’ of this preamble.

B. Regulations

Regulations regarding organ

procurement are currently found at 42

CFR part 486 (‘‘Conditions for Coverage

of Specialized Services Furnished by

Suppliers’’) under subpart G

(‘‘Conditions of Coverage: Organ

Procurement Organizations’’). The

existing regulations were recently

redesignated from subpart D of 42 CFR

Part 485 in a final rule with comment

period published in the Federal

Register on September 29, 1995 (60 FR

50446). For the benefit of the reader, we

are including a redesignation table. All

succeeding regulations references will

be to the redesignated sections.

Throughout this preamble, we generally

use the new section numbers in our

discussion of specific sections. In some

cases, we use both the old and the new

section numbers for ease of reference.

Old section (subpart

D of part 485

New section (subpart

G of part 486

485.301 486.301

485.302 486.302

485.303 486.304

485.304 486.306

485.305 486.308

485.306 486.310

485.307 486.314

485.308 486.316

485.309 486.318

485.311 486.325

On June 21, 1991, we published a

Notice of Proposed Rulemaking in the

Federal Register (56 FR 28513). In it, we

proposed to implement section 402 of

Public Law 100–607 and section 201 of

Public Law 101–616 by amending

certain sections of 42 CFR part 482,

which set forth the Medicare conditions

of participation for hospitals, and

subpart D of 42 CFR part 485, which, at

that time, set forth the Medicare and

Medicaid conditions of coverage for

OPOs.

In addition to the provisions

necessary to implement these laws, we

proposed some other revisions to the

existing regulations. These additional

regulations were derived from our

experience in administering the OPO

program and not related to legislation.

The most noteworthy of these latter

provisions dealt with change of

ownership of an OPO and with

termination of participation in the

Medicare and Medicaid.

These proposed regulations were

updated, revised, and adopted in an

interim final rule with comment period

issued on September 8, 1994 (59 FR

46513). Provisions in the interim final

rule which contained changes based on

public comments included:

• Participation in the Organ

Procurement and Transplantation

Network (OPTN) as one of the Medicare

conditions of participation for hospitals.

• Certification requirements for an

OPO.

• Requirements for an OPO service

area.

• Requirements that an OPO obtain

HCFA approval before entering into any

change of ownership, merger,

consolidation, or change in its service

area.

• Medicare payment provisions.

• OPO performance standards.

We have included detailed

information regarding the provisions of

the proposed and interim final rule with

comment period as background in the

discussion of individual topics.

We received 33 timely items of

correspondence in response to the

September 8, 1994, interim final rule

with comment period. This final rule

with comment period responds to the

comments we received on the interim

final rule with comment period. It also

contains revisions to the regulations to

implement provisions of the Social

Security Act Amendments of 1994

(Public Law 103–432). These changes to

the conditions of coverage for OPOs (42

CFR Part 486) are discussed below.

II. Service Area (§ 486.307)

A. Background

Before enactment of Public Law 100–

607, the PHS Act provided that, unless

an OPO service area comprised an entire

State, it had to be of sufficient size to

include ‘‘at least 50 potential organ

donors’’ each year.

Section 402(c)(1)(A) of Public Law

100–607 amended section 371(b)(1)(E)

of the PHS Act to require the service

area to be large enough that the OPO

‘‘can reasonably expect to procure

organs from not less than 50 donors

each year.’’

We determined that this change

would have resulted in a substantial

number of existing OPOs failing to

qualify for redesignation, because we

interpreted the requirement that the

OPO ‘‘can reasonably expect to procure

organs from not less than 50 donors’’ to

be more stringent than the requirement

that the service area include ‘‘at least 50

potential organ donors.’’ According to a

Departmental study cited in the Report

of the Committee on Energy and

Commerce on a precursor to the 1988

legislative amendments to the

Transplant Amendments Act of 1987

(H.R. Rep. No. 383, 100th Cong., 1st

Sess. 5–6 (1987)), the average OPO was,

at the time of the report, procuring

organs from only 44 donors per year.

(Because more than one organ may be

obtained from a donor, the average

number of organs obtained per OPO per

year was about 110.) Currently, the

average number of donors per OPO is

77, resulting in an average of 279 organs

per OPO.

Most of the designated OPOs were

scheduled for redesignation beginning

in March 1990 and would have been

required to meet the new requirement

imposed by Public Law 100–607.

Information obtained from many

representatives of organ procurement

organizations (OPOs) revealed that

almost one-half of the OPOs would not

have been able to meet the new

requirement. Some organ procurement

and transplantation experts believed

that many of the OPOs that did not have

a realistic expectation of procuring

organs from at least 50 donors were

nonetheless effective and efficient

entities. Consequently, the Department

and other interested parties sought

statutory relief to avoid disruption to

the nation’s organ procurement system.

On April 23, 1990, Public Law 101–

274 was passed. It postponed until

January 1, 1992, the effective date of

section 402(c)(1)(A) of Public Law 100–

607, which changed the definition of

‘‘service area.’’ Therefore, the ‘‘at least

50 potential donors’’ requirement would

have remained in full force and effect

until that date. However, Public Law

101–616 further amended section

371(b)(1)(E) of the PHS Act to require an

OPO to have a defined service area that

(1) is of sufficient size to assure

maximum effectiveness in the

procurement and equitable distribution

of organs, and (2) either includes an

entire Metropolitan Statistical Area

(MSA) or does not include any part of

the area. Section 201(d)(2) of Public Law

101–616 required the Secretary to

publish a proposed definition of

‘‘service area’’ by February 14, 1991,

and final regulations defining ‘‘service

area’’ by November 16, 1991.

In the June, 1991 proposed rule, we

specified in § 485.304(d) that an OPO

cover a service area ‘‘* * * of sufficient

size to assure maximum effectiveness in

the procurement and equitable

distribution of organs and that either

includes an entire metropolitan

statistical area as specified by the Office

of Management and Budget or does not

include any part of such area

* * * *’’.

In the September 1994 interim final

rule, we revised proposed § 485.304(d)

(now § 486.306(d)) to provide that, for

designations in 1996 and thereafter, an
19724 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

OPO’s service area must include an

entire State or the OPO must procure

organs from an average of at least 24

donors per calendar year in the 2 years

before the year of designation. We

provided that an OPO operating in a

noncontiguous U.S. State, a U.S.

Territory, or a U.S. Commonwealth,

such as Hawaii or Puerto Rico, was

subject to a specified, alternative

standard beginning January 1, 1996. We

also provided that if an entity has not

previously operated as a Medicarecertified OPO, it must demonstrate that

it can procure organs from at least 50

potential donors per calendar year.

B. Public Comments and Our Responses

Comment: One commenter suggested

that we require that every transplant

center have a working relationship with

an OPO.

Response: Existing law and

regulations already require this

relationship. Sections 1138(a)((1)(C) and

1138(a)(3) of the Act require that a

hospital have an agreement, as

described in section 371(b)(3)(A) of the

PHS Act, with its designated OPO if it

is to participate in the organ

procurement program. Medicare

regulations at 42 CFR 405.2163 require

that every renal transplant center

‘‘* * * participates in a patient registry

program with an OPO designated or

redesignated under Part 485, Subpart D

* * * ’’. (We are changing this reference

to Part 486, Subpart G in this final rule

with comment period to reflect the

redesignation). In addition, we have

published in the Federal Register

notices containing the Medicare

coverage criteria for heart (52 FR 10935,

April 6, 1987), liver (56 FR 15006, April

12, 1991), and lung (60 FR 6537,

February 2, 1995) transplantations. Each

of these notices requires that a hospital

submit documentation demonstrating

the hospital’s agreement with a

Medicare-certified OPO as one of the

conditions necessary for Medicare

approval as a facility for which

respective organ transplantation may be

covered. We believe that these

requirements meet the commenter’s

suggestion.

Comment: One commenter suggested

that more consideration be given to

regional MSAs than to State boundaries.

The commenter believed the current

policy results in poor service to remote

areas.

Response: It is not clear to us how the

current policy would inappropriately

effect organ distribution to remote areas.

We believe, however, that the law is

clear regarding the MSAs and provides

little latitude for alternative

interpretation. Section 371(b)(1)(E) of

the PHS Act provides that an OPO

‘‘* * * has a defined service area that

is of sufficient size to assure maximum

effectiveness in the procurement and

equitable distribution of organs, and

that either includes an entire MSA (as

specified by the Director of the Office of

Management and Budget) or does not

include any part of the area.’’ Thus, we

have no authority to split MSAs in

designating OPO service areas. Other

than repeating this statutory language,

our Medicare regulations do not address

MSAs.

As a matter of practice, we designate

OPO service areas on a county specific

basis. An OPO’s service area will

include all of the counties within the

MSA and as many other counties as it

desires and is awarded based on the

criteria in § 485.308 (now redesignated

as § 486.316). We note that all counties

that contain a hospital are assigned to

one of the designated OPOs. In addition,

in principle, we believe that organ

donation is most likely to be enhanced

where there is a willing and cooperative

arrangement between the hospital and

the OPO. Therefore, we believe that it

could be potentially deleterious rather

than helpful to force hospitals in

counties that are not officially part of an

MSA to be served by the OPO servicing

the MSA. However, if the parties agree

that designation of a regional MSA

would be helpful, we would not

preclude such designations.

Comment: One commenter noted that

current terminology used by the Office

of Management and Budget (OMB)

refers to ‘‘Metropolitan Area’’ (MA)

rather than MSA as the general term

describing urban classifications. Within

MAs, there are several categories: MSA,

Consolidated MSAs (CMSAs), Primary

MSAs (PMSAs), and New England

County Metropolitan Areas (NECMAs).

The commenter requested clarification

as to which MA categories are

applicable to the OPO regulations.

Response: For purposes of the OPO

regulations, MSAs encompass the

current MA categories of MSA, PMSA,

and NECMA. A CMSA is comprised of

a number of PMSAs that are considered

separately for purposes of defining OPO

service areas. In New England, we use

NECMAs rather than MSAs and PMSAs

which are based on townships rather

than county areas. Since OPO service

areas are defined based on counties, we

believe it is more appropriate to use the

county equivalent MA designations in

New England (that is, NECMAs). The

law clearly states that we may not

divide an MSA into the service areas of

multiple OPOs. If an OPO’s service area

includes any part of an MSA, PMSA, or

NECMA, it must include the entire area.

Comment: One commenter noted that

a newly established OPO could qualify

based on a determination that it has the

potential to procure organs from at least

50 potential donors. The commenter

requested clarification as to how the

organization would demonstrate this

fact. The commenter also noted that

currently OPOs convert fewer than 50

percent of the potential donors to actual

donors. Therefore, it is unlikely that an

organization with only a 50-donor

potential can meet the 24-donor

criterion.

Response: The current criterion for

qualification as an OPO servicing an

area of fewer than 2.5 million people is

that the organization demonstrate that it

has the potential to procure organs from

50 donors. Thus, the criterion we have

established for newly functioning OPOs

is identical to that currently applied to

the existing OPOs. We have historically

not prescribed how an OPO must

demonstrate this standard is met.

Rather, when making such a

determination, we have accepted the

information submitted by the OPO,

evaluated it, and requested clarification

if necessary. We believe it is appropriate

to hold newly established OPOs to the

condition in place for existing OPOs.

Thus, we do not intend to specify how

such a standard is to be met. We will

continue to allow flexibility for the OPO

to come forward with reasonable

information to demonstrate its position.

We do, however, intend to take a

more rigorous look at the information

than we have previously. Newly

established OPOs need to qualify at the

end of a 2-year period based on one of

the other criteria. In most cases, this

criterion will be an average 24 donors

per year over a 2-year period. We

believe it would be disruptive to the

organ procurement industry to allow

OPOs to enter the arena only to exit 2

years later if they cannot meet the

qualification criteria. Consequently, we

expect OPOs to act responsibly and to

have a specific plan for achieving the

long-term qualification criteria.

Comment: Several commenters

expressed concern about the 24-donor

rule. For the most part, these

commenters believed that some very

small OPOs are performing efficiently as

is evidenced by the fact that they meet

the performance criteria. The

commenters believed that the 24-donor

criteria is not an appropriate measure of

performance. They recommended that

no size limitations be part of the

qualification criteria for designation as a

Medicare-approved OPO.

One commenter believed that we

should continue to permit an OPO that

meets the performance criterion to
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19725

qualify if it has an alternative local unit

(ALU) to address the equitable

distribution issue. An ALU is an area

developed by the OPO and approved by

the OPTN contractor as an alternative

area as an aid to equitable distribution.

An ALU may be treated as a substitute

for the OPO’s service area in the

allocation scheme. The commenter,

from a very small OPO that is one of

three OPOs operating in a single

medium-size State, believed that HCFA

should continue to permit an OPO that

meets the performance criterion to

qualify if it has an ALU to address the

equitable distribution issue. In the

commenter’s State, the three OPOs share

certain matched organs on a broader

scale than they would if the ALU were

not in place, but the majority of organs

are allocated locally. The commenter

believed that the regulations should be

modified to provide for an exception

criterion that would allow this small

OPO to continue to qualify.

Response: The qualification criteria

are intended to implement section 371

of the PHS Act. Section 371(b)(1)(E) of

the PHS Act provides that an OPO must

have a defined service area that

‘‘* * * is of sufficient size to assure

maximum effectiveness in the

procurement and equitable distribution

of organs * * *.’’ We believe the use

of the explicit words ‘‘of sufficient size’’

in the statutory language is a clear

expression that the Congress intended

the Secretary to establish some

measures of size in response to this

mandate in the law.

Further, when we look at the

legislative history, we believe that the

Congress intended that the service area

size criterion be rigorous. Section 371

initially set the qualification criterion at

50 potential donors. However, the

Congress recognized that this criterion

was too lax. The Congress subsequently

modified section 371(b)(1)(E) in section

402 of Public Law 100–607 to require

the service area to be large enough that

the OPO ‘‘* * * can reasonably expect

to procure organs from not less than 50

donors each year’’.

When this legislation was enacted, we

recognized that setting the qualification

standard at this level at that time would

have resulted in decertification of

approximately one-half of the OPOs

approved by Medicare. Consequently,

we sought legislative relief from the

statutory standard. The Congress

responded to our request with Public

Law 101–616.

We acknowledge that the fact that an

OPO procures 24 donors per year is not

in and of itself assurance of ‘‘maximum

effectiveness’’ in organ procurement.

We believe, however, that this criterion

certainly contributes to the retention of

OPOs that are more likely to be effective

in organ procurement. This is true

particularly for OPOs with service areas

that have populations under 1.5 million.

We do not believe that it is productive

and cost effective to continue to retain

several OPOs operating within a single,

often small, State. In these cases, often

too much time and effort are spent in

competition with the neighboring OPO

rather than in organ outreach. Generally,

a merger of a number of small

competing OPOs is cost effective

because it results in shared overhead,

shared optimal practices, and a higher

ratio of organs to fixed operating costs.

Our decision to proceed with the 24-

donor rule, however, is not solely based

on the maximum effectiveness portion

of the statutory language. The law also

specifically requires that service area

designations be sufficiently large to

ensure equitable distribution of organs.

Organs available for transplant are a

scarce resource. There are many more

people on the transplant waiting list

than there are available organs. Both the

Congress and this Administration

support transplant policies that

contribute to the equitable distribution

of organs. We believe a proliferation of

a large number of very small OPOs does

not contribute to this goal. The organ

allocation policies give priority, in most

cases, to distribution of organs within

the service area. Consequently, OPOs

must give first priority to keeping organs

procured within their service areas for

transplant rather than dispersing them

to a larger area. The existence of a

substantial number of small OPOs could

be disruptive to an effective large organ

allocation system because each of these

OPOs would be keeping organs for

transplant within its own small service

area.

For example, a small hospital-based

OPO may have only a single transplant

center (itself) within its service area. In

most cases, all the organs procured in

the service area are then transplanted to

patients on the waiting list at the

transplant center instead of being

allocated to patients on a regional or

national basis. The OPO, in accordance

with the national allocation rules, is

transplanting the procured organs to the

highest-ranking appropriate patients in

the local area. These patients may have

been on the waiting list a very short

time. Equally appropriate patients in the

region who have been waiting a much

longer period of time would not receive

the organs because they are outside the

local area. Since the OPO is servicing

only itself, it has an incentive to be a

high-performing OPO. The patients at

this center have a shorter wait time.

However, in a neighboring town that

is part of a larger OPO service area,

there may be several hospitals that must

share the organs procured from an OPO

that is as effective in procuring organs

as the small OPO. Because this OPO

must share organs among several

transplant centers, patients in these

centers must wait considerably longer

for the needed lifesaving organs. As a

result, there is significant disparity

among the transplant center waiting

times. In various hearings on organ

transplantation over the years the

Congress has expressed concern about

the disparity in waiting times for organ

transplantation among various

geographic areas. Many members of the

Congress have expressed a strong desire

to move toward a national allocation

methodology to mitigate this condition.

We believe that the definition of service

area in the statute that addresses the

idea that an OPO’s service area be of

sufficient size to assure equitable

distribution is direction to the Secretary

to not only look at OPO performance or

effectiveness but to also consider the

impact of service area size on organ

distribution since very small OPO

service areas tend to result in

disproportionately short waits in some

areas and disproportionately long waits

in other areas. We conclude that a

proliferation of very small OPOs may

not be consistent with an equitable

distribution system as required in the

statute.

While we acknowledge the existence

of an ALU for the purpose of organ

distribution may potentially mitigate

some of the concern regarding equitable

distribution, we believe that there are

other values associated with

establishing OPO minimal service area

size that cause us to continue to support

this position. There are many benefits of

the consolidation of OPOs, such as the

sharing of best practices, shared

overhead, expediency in reacting to

emergency situations, consistent

procurement and transplant practices,

and promotion of equitable treatment.

We find no benefit to the program or the

American public in retaining very small

OPOs under a system of exceptions

when there is no potential that these

OPOs would ever meet the size

criterion.

On the other hand, we have not

arbitrarily set up criteria that restrict

OPOs to a certain size or population

base. We recognize that small OPOs can

be very effective in procuring and

distributing organs despite serving a

small population area in certain

circumstances. OPOs may qualify if they

service an entire State, regardless of the

population or the number of donors
19726 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

available. Similarly, we have

established special qualifying criteria

for OPOs servicing areas that are not

contiguous to the rest of the nation.

OPOs servicing Hawaii, Alaska, and

U.S. territories must meet alternative

criteria as discussed below.

We also point out that the criterion is

applied based on a 2-year average. Thus,

if an OPO fails to meet the criterion in

one year due to uncontrollable or

unforeseen circumstances, it will have

an opportunity to make up for lost

donors in the following period. Since

this is a static number, OPOs will be

able to continually monitor themselves

against this criterion and take corrective

actions as necessary to improve.

In evaluating the impact of this

criterion on the existing OPOs using

historical data, we are comfortable that

the criterion will not have a major

adverse impact on the existing OPOs.

Based on 1994/1995 data, three OPOs

that would have met the performance

criterion if it had existed in that period

would not have met the 24-donors per

year criterion. However, one of these

OPOs would have qualified under the

statewide criterion. The remaining two

OPOs are small organizations located in

States with alternative, OPOs. We

believe alternative, high-performing

OPOs could service the respective areas

adequately, while providing for a

broader allocation area that is likely to

promote more equity in organ

distribution. Consequently, we continue

to believe that the 24-donor rule is

appropriate as one of the qualification

criteria.

In response to the comment that the

24-donor rule is not an appropriate

measure of performance, we have

reviewed this requirement. We agree

that the 24-donor rule is not a measure

of performance but a measure of service

area size. Furthermore, it is redundant

to maintain this requirement as both a

performance and a qualification

criterion. All OPOs must meet all of the

qualification criteria to be recertified. It

serves no purpose to place the

requirement in two separate sections.

Therefore, we are deleting

§ 486.310(b)(2) (formerly

§ 485.306(b)(2)) from this final rule with

comment period.

Comment: Some commenters noted

that this same criterion was both a

qualification standard and a

performance standard. The performance

standard is one that is subject to a

corrective action plan. However, it was

not clear whether the qualification

criterion is subject to corrective action.

Response: As noted above, we are

deleting the 24-donor rule as a

performance criterion. Nonetheless, we

think the commenters’ concern that

there is no provision for exception to

the qualification criteria is important.

The law specifically requires that an

OPO be of sufficient size to assure

maximum effectiveness in the

procurement and equitable distribution

of organs. As discussed above, we do

not believe it is in the best interests of

the program or the public to establish an

exception system for very small OPOs

that historically do not possess the base

to achieve 24 donors. Even though such

a small OPO may be performing

adequately based on its population base,

we are concerned that the proliferation

of extremely small service areas runs

counter to the objectives of an equitable

national organ allocation system.

However, we recognize that an OPO

may experience unforeseen

circumstances beyond its control that

result in the OPO failing to meet the

qualification criterion during a single

recertification period. Consequently, we

are adding a new § 486.307(d)(3) to

provide for an exception process.

This exception process is explicitly

limited to those OPOs that have

historically met the criteria and that

have a specific plan to achieve 24

donors per year in the future. We are

also allowing a one-time exception for

the transitional period. This exception

allows an OPO that meets the

performance standards in § 486.310 to

continue Medicare and Medicaid

participation for 2 years while it puts in

place a plan to achieve 24 donors per

year in the future. (See Section X of this

preamble)

To receive the exception, an OPO

must file its request with HCFA at least

15 days before its recertification date.

The request must be in narrative form.

If the exception is based on unusual

circumstances the narrative must

explain in detail the unusual

circumstances that contributed to the

OPOs failure to procure 24 donors per

year. The exception request must also

include data regarding the number of

donors per year for the 5 years

immediately preceding the present

designation period. For example, if an

OPO fails to meet the qualification

standard for the 1996 designation period

and it requests an exception, it must

submit data, by year, for donors

procured from 1991 through 1995. The

exception request must also detail the

specific actions the OPO intends to take

to increase organ donors to 24 per year.

Detailed instructions concerning the

exception process and the corrective

action will be included in the manual

instructions.

Comment: One commenter wrote

encouraging us to view the qualification

criteria as bare minimum which should

not be weakened for any reason. The

commenter was concerned with the

discrepancy between the qualification

standards for new OPOs and currently

existing OPOs.

Response: We appreciate support for

the qualification standards adopted. As

noted above, we believe it is important

to maintain high standards to encourage

OPOs to make every effort to procure all

available organs. However, we are not

aware of any means to avoid a

discrepancy in standards between new

and existing OPOs. That is, a new OPO

will not have actual data on any

objective measure of organ recovery or

transplant rates. Consequently, we have

no alternative than to use a measure of

potential procurement for the initial

designation.

On the other hand, if an OPO is not

recovering the potential organs, despite

the fact that the area is large enough to

support minimum recovery level, we

believe it would be irresponsible to

continue to allow that OPO to service

the area. Thus, while there may be some

discussion as to what exactly is the most

appropriate qualification standard for

existing OPOs, we believe that there

should be no alternative to setting the

standard using actual experience

measures as opposed to potential. Since

it is impossible to use actual data for

new OPOs and we are wedded to using

actual data for existing OPOs, there

appears to be no alternative but to use

different standards for new and existing

OPOs.

However, from the context of the

comment, it appears that the commenter

believes the standard for new OPOs,

which uses potential recoveries, is more

difficult than the standard for existing

OPOs. We point out that while the

number of potential donors for new

OPOs is higher than the number of

actual donors for existing OPOs, we do

not believe the standard for new OPOs

is more rigorous. We have been told by

some OPOs that the average conversion

rate of potential organs is approaching

3 to 1. This means that to achieve the

standard for existing OPOs of 24 donors,

a new OPO should have an area big

enough to have close to 72 potential

donors.

We did not use the 72-donor criterion

for several reasons. First, we believe it

is inappropriate to hold new OPOs to a

different initial standard than that

which had to be met by their

competitors when they first entered the

program. Second, we believe that new

OPOs deserve the benefit of the doubt

in achieving a conversion rate that is

above the national average. That is, a

new OPO may have only 50 potential
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19727

donors, but because of effective

practices is able to achieve a conversion

rate of 2 to 1, and thus would continue

to meet the qualification criterion at

recertification time.

Comment: One commenter noted that

not all OPO service areas are contiguous

territories. The commenter requested

that HCFA prohibit OPOs from

developing noncontiguous areas, citing

difficulty in organ allocation when

service areas are separated.

Response: The commenter did not

present any data or examples

demonstrating that noncontiguous areas

are problematic. Further, the issue of

noncontiguous service areas has not

presented a significant problem for

organ allocation or procurement to the

best of our knowledge. Most OPOs that

have noncontiguous service areas have

established field offices in each

territory. Often, they have secured

approval for alternative allocation

policies for each portion of the service

area. While there may be some

administrative complexities associated

with noncontiguous areas, this concept

has appeared to work very well. We find

no reason to prohibit the practice in the

future.

C. Provisions of This Final Rule With

Comment Period

We are making the following changes

to the interim final rule.

• We are revising § 486.306(d). We

are retaining the general requirements

for documentation of service area in

paragraph (d) and moving the specific

detailed requirements in that paragraph

to new § 486.307 OPO service area

requirements and documentation and

including a cross-reference to § 486.307

in § 486.306(d). We are making this

change as a technical change to allow

for a better organization and readability

of the regulations.

• We are adding § 486.307(d)(3) to

provide for an exception process when

an OPO experiences unforeseen

circumstances beyond its control that

result in the OPO failing to meet the

qualification criterion during a single

certification period. To qualify for an

exception, the OPO must demonstrate

that (1) it failed to meet the 24-donor

criterion due to unusual circumstances

beyond its control, (2) it has historically

maintained a service area sufficient to

assure effective procurement and

equitable distribution (that is, it has

historically achieved 24 donors per

year), and (3) it has a specific plan to

achieve 24 donors per year in the future.

• We are deleting § 486.310(b)(2)

(formerly § 485.306(b)(2)). This

paragraph contains the 24-donor rule as

a measure of performance. As noted

above, we are keeping this measure as

a qualification criterion.

• Although we did not receive a

comment to this effect, we are

redesignating § 486.310(a)(3) (formerly

§ 485.306(a)(3)), that requires OPOs to

enter into a working relationship with

any hospital or transplant center in the

OPO’s service area that requests a

working relationship, as § 486.304(b)(8).

We believe that this requirement is more

appropriately considered as a

qualification standard for OPOs rather

than as a performance standard.

III. Composition of the Board of

Directors of an OPO (§ 486.306(f))

A. Background

Section 485.304(f) (redesignated as

§ 486.306(f)) requires that as one of the

conditions for qualification as an OPO

under the Medicare and Medicaid

programs, an OPO must have a board of

directors or an advisory board that has

the authority to recommend policies

relating to the donation, procurement,

and distribution of organs. That section

also specifies that the board must

include members with various

backgrounds and areas of interest. In the

proposed rule, we included a revision to

§ 485.304(f)(3) (now § 486.306(f)(3)) to

allow either a physician or an

individual with a doctorate degree in a

biological science with knowledge,

experience, or skill in the field of

histocompatibility to serve on an OPO

board of directors or advisory board. In

the interim final rule, we changed the

requirement from ‘‘a physician with

knowledge, experience, or skills in the

field of human histocompatibility’’ to ‘‘a

physician with knowledge, experience

or skill in human histocompatibility, or

an individual with a doctorate degree in

a biological science and with

knowledge, experience, or skills in the

field of human histocompatibility.’’

In addition to this requirement,

§ 486.306(f) specifies that the board

must also consist of:

• Members who represent hospital

administrators, tissue banks, voluntary

health associations in its service area, or

emergency room personnel.

• Members who represent the public

residing in that area.

• A neurosurgeon or another

physician with knowledge or skills in

the field of neurology; and

• A transplant surgeon from each

transplant center in its service area with

which the OPO has an arrangement to

coordinate its activities.

While an OPO may have more than

one board, the membership composition

specified in § 486.306(f) must exist on a

single board.

B. Public Comments and Our Responses

Comment: Several commenters

questioned the composition of the

policy board. Some commenters

expressed concern with the involvement

of a transplant surgeon from each

transplant center. They interpreted the

regulation as requiring that each

transplant surgeon from each center be

placed on the board. They commented

that this provision would produce very

large and costly boards and would give

transplant surgeons control.

Response: The commenters

misinterpreted the regulation. We are

not requiring that each transplant

surgeon be included on the OPO policy

board. Rather, we are including in the

regulations the statutory requirement

contained in section 371(b)(1)(G)(i)(V) of

the PHS Act. This section requires that

there be one transplant surgeon from

each transplant center within the OPO

service area included on the policy

board.

We agree with the commenter that to

include all transplant surgeons would

be inappropriate. Such a situation

would give transplant surgeons a

disproportionate influence over OPO

policies. We did not intend to require

the inclusion of every transplant

surgeon. In fact, we read the statute as

prohibiting this composition. That is,

we believe the statute does not provide

the OPO an opportunity to alter the

composition of the board from that

provided in the law. Section

371(b)(1)(G)(i) of the PHS Act states

clearly that the board ‘‘is composed of

* * * from each transplant center

* * * a member who is a surgeon

* * *.’’ We believe the use of the article

‘‘a’’ to modify transplant surgeon

members, expresses the will of the

Congress that the board be composed

using only a single transplant surgeon

from each transplant center within the

service area. The statute does not say

that the board must include at least the

following members. Rather it clearly

states that the board is composed as

directed. Thus, OPOs may not add

additional members to the policy board

other than those specified in

§ 486.306(f). We are modifying this

section to specify that the board must

‘‘be composed of’’, rather than say

‘‘include’’ to clarify this provision.

Comment: Another commenter

recommended that § 486.306(f) be

modified to include only a single

representative from one of the

disciplines from each transplant center

on the policy board. The commenter

was concerned that the current

regulation gives surgeons a

disproportionate influence on the board
19728 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

or requires very large boards to balance

their influence.

Response: As noted above, the statute

is very clear in describing the

composition of the policy board. To

alter the composition would require a

change in the law. However, we are not

convinced that the composition

mandated in the law is problematic in

most cases.

The law requires both a neurologist

and a histocompatibility expert on the

board. In addition, it requires an

unspecified number of other people that

may be included; for example,

representatives of hospital

administrators, intensive care and

emergency room personnel, tissue

banks, voluntary health associations,

and members of the public. Although

the law does not specify the number of

these representatives, it is clear that

there must be multiple representatives

through the use of the plural of the word

‘‘members’’ in sections 371(b)(1)(G)(i) (I)

and (II) of the PHS Act. In all but a few

extremely large urban OPO service

areas, using only the minimum

representation from these other

categories will result in a fairly small

and balanced policy board.

We acknowledge that there will be

isolated cases where the requirement for

a surgeon from each transplant center

may be problematic. For example, we

are aware of one OPO that services 17

transplant centers. The inclusion of 17

transplant surgeons will result in a very

large and potentially difficult policy

board. Therefore, we are considering

recommending a statutory change to the

Congress regarding the law governing

OPO board composition. In the

meantime, the boards must be

composed as directed in the law.

Comment: Other commenters

recommended that OPOs be allowed to

establish committees, such as a quality

of organs recovered committee or a

medical committee, in lieu of full

representation on the policy board by all

surgeons. Still other commenters

expressed support for inclusion of one

transplant physician from each

transplant center on the policy board.

Response: As noted above, the

composition of the board is explicit in

the statute. We do not have the

authority to condone alternative

governing strategies. We will consider

developing a recommendation for

statutory change in this regard.

However, we believe that the statute

would not prohibit OPOs from

establishing the committees that have

been suggested. Such committees could

advise the board and may be very

helpful in developing the OPO’s

policies and influencing its practices.

We strongly encourage OPOs to seek

opinions from their customers and

others affected by their decisions. The

only problem we find with the

commenter’s recommendation is that

such committees cannot be used in lieu

of full representation.

Comment: One commenter suggested

that § 485.304(f)(3) (now § 486.306(f)(3))

relating to histocompatibility

representation on the board be

broadened further to include a doctorate

level individual in bioethics or a

nursing specialty.

Response: We are not certain if the

commenter intended that the

histocompatibility requirement be met

by someone with bioethic or nursing

doctorate level education or that such

individuals be added in addition to the

histocompatibility person. We believe

that the histocompatibility requirement

is extremely important to the policy

board composition. Histocompatibility

testing is paramount in discussing

policies related to equitable distribution

of organs. We believe that the

histocompatibility representative on the

policy board must be someone with a

medical degree or a biological science

degree with experience in human

histocompatibility.

The requirement included in

§ 486.306(f)(3) is a reiteration of the

requirement in the statute. The current

law does not authorize alternative

education for this requirement.

However, the current regulations do not

prohibit an OPO from including

someone with a doctorate level

education in nursing or bioethics on the

board. The statute does not provide

specific direction as to the education or

number of representatives from

hospitals and the public. An OPO could

certainly choose to include a person

with advanced nursing and bioethics

training, or both, as one of these board

representatives.

Comment: One commenter

recommended that the OPO boards be

comprised of not more than 50-percent

representation from transplant centers.

Response: As noted above, we have

described the composition of the OPO

boards in this regulation in accordance

with section 371 of the PHS Act. We

note that the law does not prescribe the

number or skills mix of representatives

from hospitals or the public. We expect

that, given that the boards must include

a transplant surgeon from each

transplant center, in most cases the

transplant centers will be heavily

represented on the boards.

We believe, however, that it is

unnecessary and inappropriate to

dictate the percentage of transplant

center representatives on the board. We

believe that each OPO is best equipped

to determine the needs of its operation

and the community. Given the number

of transplant centers in the OPO’s

service area, such a requirement could

result in extremely large boards which

could be costly to the OPO and,

consequently, the Medicare and

Medicaid programs. Further, we do not

believe that the statute supports such a

requirement because the law was

deliberately vague in its use of the term

‘‘representatives’’ as opposed to use of

limiting article ‘‘a’’ in the requirements

regarding members of the board.

However, given the rigorous

performance standards that OPOs must

meet, we expect that each OPO will

ensure as broad a representation as

practicable in setting up its policy

board. We expect that it would want to

seek out increased involvement with

donor hospitals and public

representatives to achieve innovative

strategies to increase donation rates.

OPOs that fail to modify their boards to

achieve a balance in representation from

the donor community and the transplant

community are likely to feel the

consequences in failure to meet

performance standards. Thus, although

we are not specifying the percentage of

representatives, we are holding OPOs

accountable for appropriate decisions.

C. Provisions of this Final Rule With

Comment Period

We are clarifying § 486.306(f) by

revising the language describing the

OPO board. The revised language, ‘‘the

advisory board must be composed of the

following,’’ more clearly indicates that

there is no discretion to add or remove

skills to the mix on the board.

IV. Equitable Distribution of Organs

(§ 486.306(i))

A. Background

In a proposed revision to § 485.304(i)

(now § 486.306(i)), we specified that an

OPO must have a system to allocate

donated organs equitably among

transplant centers and patients

according to established medical

criteria. This revision was made to

include the word ‘‘equitably’’ in the

previously existing requirement. In the

interim final rule with comment period,

we changed the requirement to

eliminate the allocation of organs among

‘‘centers’’ and to specify the medical

criteria that the system must operate

under; that is, they must be consistent

with Centers for Disease Control and

Prevention (CDC) standards and with

OPTN rules. We made the former

change to be consistent with section

371(b)(3)(E) of the PHS Act.
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19729

B. Public Comments and Our Responses

Comment: One commenter believed

there was now an absence of a

requirement for OPOs to equitably

distribute organs. Another commenter

recommended that there be a follow-up

mechanism to ensure that OPOs use a

system to allocate organs according to

established medical criteria.

Response: The regulations at

§ 486.306(i) require OPOs to have a

system to equitably allocate donated

organs among transplant patients that is

consistent with the CDC and the OPTN

rules. We made the change in the

interim final rule to specifically add the

word ‘‘equitably’’ to the distribution

requirement. Currently, the OPTN

develops a national organ allocation

system. The system is developed by the

membership and is medically based.

Although we are aware of isolated

instances of OPOs using allocation

systems that do not comport with the

national OPTN rules, we do not believe

that this situation is widespread.

Consequently, we believe it is

unnecessary to establish a formal

mechanism to evaluate OPO allocation

methodologies at this time. However,

we invite the public to advise the

Department of incidents of organ

allocation that fall outside the

established system. Incidents should be

reported to Judith B. Braslow, Director,

Division of Organ Transplantation,

Room 7–18, 5600 Fishers Lane,

Rockville, MD 20857.

Comment: Two commenters requested

clarification regarding the reference to

the CDC standards. They noted that the

CDC guidelines were published as

guidelines, not rules. They inquired if

inclusion in § 485.304(i) (now

§ 486.306(i)) sets these guidelines as

standards of practice for the entire

transplant community.

Response: Section 486.306(i) requires

that an OPO’s system of distribution of

organs among patients be consistent

with the CDC standards. For the most

part, these CDC standards relate to

screening potential organ donors and

organs recovered for Human

Immunodeficiency Virus (HIV)

infection. We believe that the

monitoring for HIV infection is critical

and is an essential element for Medicare

certification of OPOs. In fact, in section

371(b)(3)(C) of the PHS Act, the

Congress has specifically required that

OPOs evaluate an organ for HIV

infection.

Exclusion of prospective blood donors

based on their acknowledged risk

factors for HIV infection began in 1983.

In 1985, when the test for the HIV

antibody became available, screening of

prospective donors of blood, tissue and

organs began. Both measures have

reduced remarkably the transmission of

HIV via these routes. A 1991

investigation, however, determined that

several recipients had been infected

with HIV by an organ/tissue donor who

had negative HIV antibodies at the time

of the donation. This occurrence raised

questions about the need for additional

Federal oversight of transplantation of

organs and tissues.

A work-group was formed by the

Public Health Service (PHS) to address

transmission of HIV through

transplantation of human tissue. This

group produced a set of

recommendations that were included in

the CDC Guidelines that we have

included as an appendix to subpart G of

part 486 and referenced in the OPO

regulations. OPOs must abide by the

CDC guidelines to qualify for Medicare

and Medicaid certification.

In developing the recommendations,

the PHS sought assistance from public

and private health professionals and

representatives of the transplant

community, public health and other

organizations. A total of 37 external

consultants and 18 government staff

formulated the recommendations. These

recommendations address issues such

as donor screening; quarantine of tissue

from a living donor; inactivation or

elimination of infectious organisms in

organs and tissues before

transplantation; timely detection,

reporting, and tracking of potentially

infected tissues, organs and recipients;

and recall of stored tissues from donors

found after donation to have been

infected. Factors considered in the

development of these guidelines

included differences between the

screening of living and cadaveric

donors; time constraints due to organ/

tissue viability that may preclude

performing certain screening

procedures; differences in the risk of

HIV transmission from various organs

and tissues; differences between

systems for procuring and distributing

organs and tissues; the effect of

screening practices on the limited

availability of organs and some tissues;

and the benefit of the transplant

recipients.

The CDC guidelines are intended to

promote public health and safety. They

were not arrived at without appropriate

assessment of the risks and benefits for

the public health of Americans. We

fully support the CDC guidelines and

have attempted to assure compliance

with them through inclusion in the

Medicare conditions of coverage. Thus,

the inclusion of the CDC guidelines as

a requirement for OPOs does give the

CDC guidelines regarding organ

allocation the force of regulation. That

is, any OPO found to be failing to

conduct appropriate screening or

distributing organs that are not in

compliance with the CDC guidelines for

organ allocation can be found out of

compliance with the qualifications for

becoming a Medicare- or Medicaidcertified OPO and have its certification

terminated.

However, we acknowledge that the

reference to the CDC guidelines

contained in the interim final rule with

comment period is not sufficiently clear

on this point. Consequently, we are

revising § 486.306(i) to specifically

incorporate by reference the CDC

guidelines. The guidelines were issued

as one of the CDC Morbidity and

Mortality Weekly Reports, ‘‘Guidelines

on Preventing Transmission of Human

Immunodeficiency Virus Through

Transplantation of Human Tissue and

Organs,’’ Vol. 43, No. RR–8, May 20,

1994.

We did not receive a formal comment

on the application of the CDC guidelines

during the public comment period for

the interim final rule. We understand,

however, that OPOs have taken the

position that acceptance of recovered

organs is a matter of patient choice.

Some patients are so dangerously close

to death while on the waiting list that

they are willing to risk receiving an

organ potentially infected with a fatal

virus rather than risk the chance of not

finding in a timely manner an

appropriate healthy organ. Some OPOs

support the patient having the

opportunity to make this choice for

themselves and believe the CDC

guidelines prohibit this practice.

The law at section 371(b)(3)(C) of the

PHS Act is clear regarding testing for

infection with the etiologic agents (HIV–

1 and HIV–2) for acquired immune

deficiency syndrome and taking steps to

prevent exposure to HIV through

transplantation of these organs.

Regardless of the personal preference of

a potential recipient or the opinion of

the OPO staff, the law requires that

potential donors be tested for viral

markers for HIV–1 and HIV–2, and if

found to be infected, organs from that

donor are not to be transplanted.

The CDC guidelines, however, do

permit some measure of judgment for

organs tested negative for HIV

etiological agents, but procured from

donors who have demonstrated highrisk behaviors. The recommendation in

the CDC guidelines on donor screening

state that ‘‘* * * Regardless of the HIV

antibody test results, persons who meet

any of the high-risk criteria should be

excluded from donation of organs or
19730 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

tissues unless the risk to the recipient of

not performing the transplant is deemed

to be greater than the risk of HIV

transmission and disease. In such a

case, informed consent regarding the

possibility of HIV transmission should

be obtained from the recipient. * * *’’

Thus, while compliance with the CDC

guidelines requires OPOs to conduct

screening of donors through asking

questions about the potential donor’s

behavior relative to HIV-risk factors, the

guidelines do not unilaterally prohibit

transplantation of the organs from

donors found to have high-risk

behavioral criteria who have negative

HIV–1 and HIV–2 serologic tests. The

OPO may procure the organs from such

donors and make the information

concerning HIV-risk factors available to

the transplant surgeon. The transplant

surgeon will then assess the risk factors

for HIV against the risk associated with

delaying transplantation and together

with the potential recipient (and his or

her family if appropriate) make a

decision to accept or reject the organ. It

is imperative, however, that full

information regarding the risk factors be

disclosed by the appropriate transplant

surgeon to the potential recipient.

C. Provisions of this Final Rule With

Comment Period

We are including the specific CDC

guidelines cited in the interim final rule

as appendix A of part 436 subpart G. We

are also clarifying the reference to the

CDC guidelines in § 486.306(i). As a

result of these revisions, we are making

the guidelines required standards for

OPOs.

V. Testing of Organs (§ 486.306 (q) and

(s))

A. Background

In the proposed rule, we added a new

§ 485.304(r) (now § 486.306(q)) to

require OPOs to assure appropriate tests

consistent with OPTN standards and

CDC guidelines are performed to

prevent the acquisition of organs that

are infected with the HIV–1 and HIV–

2 etiologic agents for acquired immune

deficiency syndrome. In the interim

final rule, we redesignated the contents

of paragraph (r) as paragraph (q) and the

contents of paragraph (q) as paragraph

(r) and added a new paragraph (s).

Revised paragraph (r) required OPOs to

assist hospitals in establishing and

implementing protocols for making

routine inquiries about organ donations

by potential donors. New paragraph (s)

required OPOs to ensure that serologic

testing for HIV–1 and HIV–2 viral

markers is performed on potential

donors consistent with OPTN rules and

CDC guidelines for solid organ

donation.

B. Public Comments and Our Responses

Comment: One commenter

recommended that we include standard

provisions that are required for all

hospital donation protocols. The two

provisions the commenter specifically

suggested were that (1) hospitals refer

all potential donors to the OPO before

donation has been mentioned, and (2) a

trained professional be involved in all

donation requests.

Response: We believe that the

suggested protocols are good and are

likely to work quite effectively for many

OPOs and hospitals. However, it is

inappropriate to regulate specific

donation protocols at this time. There

are many different protocols that can be

highly effective in organ donation. We

do not wish to stifle the development of

innovative means of increasing the

procurement rate by regulating specific

methodologies or protocols.

Comment: One commenter expressed

concern with the requirement in

§ 485.304(s) (now § 486.306(s))

regarding CDC guidelines for preventing

transmission of HIV through

transplantation of human tissue and

organs. The commenter noted that an

OPO has no knowledge of what

information the transplant center

provided to the potential recipients

regarding their informed consent to the

risks of transmission of infections. The

commenter suggested alternative

language describing an OPO’s

responsibility to make information

available to the transplant center. This

language would state that an OPO is not

responsible for the decision to

transplant high-risk organs in lifethreatening situations.

Response: Section 485.304(s) (now

§ 486.306(s)) requires that OPOs

‘‘Ensure that donors are tested for

human deficiency viral markers

consistent with OPTN rules and CDC

guidelines for solid organ donation.’’

Similarly, § 485.304(i) (now

§ 486.306(i)) requires that the OPO

allocate organs in accordance with these

guidelines. OPOs are responsible for

testing and allocating organs in

accordance with these guidelines.

If an OPO only allocates organs that

comply with the guidelines to a

transplant hospital, a transplant center

would receive a high-risk organ to

transplant to the recipient only on a

very rare and carefully selected basis.

The OPO is required to ensure that

informed consent of the recipient is

obtained. Thus, while the commenter is

accurate in the statement that an OPO

does not formally have direct contact

with the recipient, we do not agree that

such a situation in any way alters the

responsibility of an OPO to follow the

CDC guidelines regarding testing and

allocation of organs. We expect that in

these rare cases the OPO will work

closely with the transplant center to

impress upon the center the importance

of getting informed consent

documentation to the OPO timely. We

expect hospitals will cooperate with the

OPOs in meeting this requirement.

An OPO’s responsibility does not stop

with testing the donor and making

information available to the transplant

center. The regulations go beyond this

to require the OPOs to allocate organs in

accordance with CDC guidelines. We

believe it is appropriate to continue to

hold OPOs responsible for compliance

with the CDC guidelines for allocation

as well as testing. Therefore, we are not

modifying the regulations as

recommended by this commenter.

However, as we stated above in

discussing § 486.306(i), we believe that

the nonspecific reference to the CDC

guidelines could be confusing. Thus, we

are clarifying the regulations to include

a reference to the CDC guidelines in

§ 486.306(s). The guidelines are also

included as an appendix to part 486

subpart G.

Comment: One commenter suggested

we also require OPOs to use the

guidelines and recommendations of the

PHS workgroup on the testing of organ

donors for the presence of hepatitis.

Response: Unlike the requirement for

testing for HIV viral markers, which is

contained in section 371(b)(3)(C) of the

PHS Act, there is no express legislative

authority to mandate a requirement for

hepatitis testing. Although we believe

that hepatitis testing is not precluded by

the law, there is no clear indication in

either the statutory language or the

legislative history indicating the

Congress intended that the direction

provided for HIV testing be expanded to

other infectious diseases.

We believe that it would be

permissible to issue a regulation

requiring hepatitis testing for potential

organ donors. However, we believe that

it would be imprudent to proceed with

such a requirement without the benefit

of a prior public comment period to

solicit the input of the industry and

other interested parties. We recognize

that there are significant OPO concerns

that must be considered before we

proceed with any proposal to require

testing for hepatitis. We especially want

to consider any cost impact and

potential for decline in organ donations

before we develop a regulatory change

of this nature. Consequently, we are

inviting public comment on this issue at
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19731

this time. If, after considering any

comments we receive, we believe that

change in the regulations is appropriate,

we will issue a new regulation.

C. Provisions of the Final Rule With

Comment Period

We have revised § 486.306 (q) and (s)

to include a reference the CDC

guidelines as standards in this final rule

with comment period. We have also

included the CDC guidelines as an

appendix to part 486 subpart G.

VI. Qualification Data (§ 486.306(t))

A. Background

In the interim final rule with

comment period, we added § 485.304(t)

(now § 486.306(t)) to enable us to verify

an OPO’s compliance with the

performance standards. Section

486.306(t) requires an OPO to submit

accurate data to us within 15 days

following the end of a calendar year

(unless otherwise notified), giving

information on the—

• Population of designated service

areas based on the most recent U.S.

Bureau of the Census data;

• Number of actual organ donors;

• Number of kidneys procured;

• Number of kidneys transplanted;

• Number of extrarenal organs by

type procured; and

• Number of extrarenal organs

transplanted.

B. Public Comments and Our Responses

Comment: One commenter believed

that there are multiple interpretations

for the terms for ‘‘actual donor’’ and

‘‘procured’’ that are used in the

performance standards. The commenter

recommended that HCFA adopt the

definitions that have been developed by

the OPTN contractor.

Response: Because, in the case of the

OPO performance criteria, we are using

criteria that are based on the

performance of peers, it is important

that all OPOs use the same data

definitions to report data uniformly. We

surveyed the use of various terms

within the industry, including the

OPTN contractor, and developed the

following definitions:

• Kidneys recovered—The number of

kidneys recovered is the actual number

of kidneys the OPO recovers with the

intent to transplant. Kidneys recovered

that are intended for research are not to

be included in the count. However, if a

kidney was recovered with the intent to

transplant but was not actually

transplanted due to unforeseen

circumstances, it may be counted.

Kidneys recovered en bloc are counted

as two kidneys.

• Kidneys transplanted—The number

of kidneys transplanted is the actual

number of kidneys that were

transplanted into recipients. Kidneys

transplanted en bloc are counted as two

kidneys. Kidneys transplanted as part of

multiple organ transplants, for example,

kidney-pancreas transplants, are

counted as both a kidney transplant and

an extrarenal transplant.

• Extrarenal organs recovered—The

number of extrarenal organs recovered

is the actual number of hearts, livers,

lungs, and pancreas the OPO recovers

with the intent to transplant. Each organ

is counted individually regardless of the

number of organs transplanted into the

same recipient.

• Extrarenal organs transplanted—

The number of extrarenal organs

transplanted into recipients. Each organ

is counted individually regardless of the

number of organs transplanted into a

single recipient.

We had initially collected data from

the OPOs using alternative definitions

that may have disadvantaged some

OPOs serving hospitals that frequently

engaged in multiple organ transplants,

such as heart-lung transplants, bilateral

lung transplants, and kidney-pancreas

transplants. We believe these revised

definitions treat OPOs fairly. We note

that the OPTN contractor has agreed to

use these common definitions in its data

gathering activities. Consequently, the

feedback that the OPTN contractor

provides to an OPO throughout the

performance period to monitor an

OPO’s performance against its peers

should be consistent with the HCFA

performance standards. Moreover, based

upon our impact analysis, we believe

that changing the definitions from those

contained in the interim final rule with

comment period will not adversely

impact any OPO’s ability to meet the

performance standards.

We defined ‘‘donors’’ in our previous

collections as ‘‘the number of cadavers

from which the OPO actually recovers at

least one viable organ.’’ Some OPOs

advised us that differences in OPO

protocols may result in unintended

differences among the OPOs through the

use of this definition. They

recommended that we alter the

definition to count only those cadavers

from which at least one organ was

ultimately transplanted.

Unlike the changes in other

definitions that increase the number of

organs counted for nearly all OPOs, this

recommendation for the change in the

definition of ‘‘donors’’ would decrease

the count of donors for many OPOs.

Further, in conducting an impact

analysis, we found at least one OPO that

would have met the performance

standard under the previously

announced definition would not meet

the standard under the recommended

revision.

We do not want to change the

standard without benefit of comment

from the full industry, particularly in

light of the fact that OPO representatives

differ in their views of the most

appropriate definition. Similarly, we are

concerned that making a change in the

definitions that would adversely impact

some OPOs at this late time in the

performance period without providing

those entities an opportunity for

comment is not equitable.

Consequently, we are retaining the

definition of ‘‘donors’’ that we used

when we initially collected data to

calculate performance standards for the

1996 designations. We are, however,

open to altering the definitions for the

1998 recertification process. Therefore,

we specifically invite the public to

comment on this provision. If, after

analysis of the comments, we believe

that changes are appropriate, we will

advise the public, including all OPOs, of

these changes on a timely basis.

We advised OPOs of these definitions

in our letters to them regarding the

collection of data throughout the

performance period. Similarly, we

intend to include these definitions in

the manual instructions being prepared

on the OPO conditions of coverage. We

believe that this way of proceeding will

give us more flexibility in adopting

more appropriate definitions that

become evident through continued work

with the data. We are also soliciting

comments on whether changes in the

definitions should be made through

rulemaking.

Comment: Several commenters

objected to our requirement that organs

procured and transplanted en bloc, such

as a pair of kidneys or lungs, be counted

as a single organ. The commenters

believed that each organ should be

counted separately.

Response: We had intended that the

organs be counted in accordance with

industry standards. Mistakenly, we

utilized the HCFA standard for counting

organs that is applied during the cost

reporting process. We have now

changed our definitions to be consistent

with industry usage. Each organ will be

counted separately. OPOs are not able to

influence the transplantation of

multiple organs and therefore should

not be penalized for serving centers that

engage in this practice at a greater

frequency than the national average.

We note that we have already clarified

this in our operational instructions to

the OPOs in verifying the performance

data. Thus, the performance standards
19732 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

applied for the 1996 recertification

process have been calculated based on

these revised definitions. Moreover, we

are deleting any regulatory reference to

how organs are to be counted. We

believe that this type of detailed

operational instruction is more

appropriately placed in a manual where

it can be revised more easily as

appropriate.

Comment: A few commenters

recommended that HCFA use only

verified data from the OPTN contractor

to monitor performance.

Response: We have analyzed portions

of the OPTN data relative to organ

recovery and transplantation. We found

the donor data reasonably consistent

with that reported to HCFA directly.

Thus, the idea of using the OPTN data

for calculating performance standards is

very appealing. This method would

reduce the reporting burden on the

OPOs and is consistent with the

Administration’s goal of reducing the

Federal regulatory burden. If we make

such a change, we will, of course, first

notify all OPOs timely.

However, we have two concerns

before we can implement such a

strategy. First, to make the performance

standards as current as possible while

still meeting the recertification

schedule, we require that the calendar

year data be reported as close to the end

of the year as possible. Currently, we

require the OPOs to report this data to

us by January 15 annually. Because of

the lag time of hospitals notifying the

OPTN of recipient registrations, the

OPTN contractor questions if the data

reported by the 15th of the following

month through routine channels are

comprehensive.

Second, we are concerned that OPOs

have an avenue to request adjustment of

the data or to provide any necessary

explanatory material. For example, all of

the performance criteria are population

based. Due to hospitals dealing with

OPOs other than the one designated for

the service area or census changes,

changes in the actual population data

for an area may be necessary. The OPTN

data on population is not, to the best of

our knowledge, specific to the actual

hospitals served by OPOs. Thus, to use

the OPTN data without the benefit of

adjustment could unfairly penalize

some OPOs.

We established a process for

collecting data from the OPOs. Each

OPO has been asked to submit its data

in accordance with our directions

defining the variables. OPOs have the

opportunity to identify necessary

adjustments to the population for its

designated service area to take into

account hospitals that deal with

multiple OPOs or an OPO other than the

one designated for the area. When an

OPO requests a population adjustment,

we will work with the alternative OPO

and our regional offices using

appropriate census data to accurately

apportion the population in question.

National averages and performance

criteria are calculated and forwarded to

the OPOs, along with our recorded data

from that OPO, to provide an

opportunity to review the data recorded.

The OPO has an opportunity to assure

that data entry errors or other mistakes

have not been made and provide any

necessary corrections to the data base.

We believe it is essential to provide

OPOs this form of opportunity for input

before we use the data for purposes that

could potentially result in termination

of the OPO from Medicare and Medicaid

participation.

Initially, we were concerned that this

opportunity for input would not be

available if we were to use the OPTN

data. However, we anticipate that once

the initial population for the OPO

service areas has been calculated, future

changes or adjustments, or both, will be

minor and infrequent. Thus, we may be

able to develop a process that is based

on calculation of the standards using

OPTN data, yet incorporates a process

for individual OPO adjustment requests.

Despite these concerns, we are

supportive of the concept of using the

OPTN data to calculate the performance

standards. We, together with the OPTN

contractor, will work with the OPOs and

the transplant centers throughout the

year to obtain the necessary data as

timely as possible and develop a process

for appropriate adjustments to achieve

this goal. We intend to test the 1995 and

1996 OPTN contractor data submissions

and analyze differences between the

OPTN data and the OPO data. If the

OPTN data prove satisfactory, we will

begin using them to set the 1998

standards rather than collecting the data

individually from the OPOs. We would,

however, continue to allow OPOs to

review the data and request changes as

appropriate. We note that adopting the

OPTN data may require revisions to the

regulation or paperwork requirements or

both. We invite OPOs to participate

with us in this process during the

ongoing evaluation.

Comment: One commenter believed

that the requirement that the data be

submitted within 15 days of the end of

an calendar year is unreasonable. The

commenter recommended that OPOs be

given 60 days in which to submit data.

Response: We acknowledge that a 15-

day period for submission of data after

the end of the year may appear

unnecessarily onerous. But, upon closer

examination, we believe that the request

is quite reasonable. The data are for

items routinely collected by nearly all

OPOs, there are only six data elements,

and the data for the first 11 months may

be gathered in advance of the due date

with the final month’s data added at the

end of the year.

In addition, we believe that it is

impractical to extend this timeframe

because of the work that must be done

to determine the performance standards

before the recertification process which,

for most OPOs, begins in April. Prior to

the beginning of April in the years in

which the recertification process takes

place, we must review the data

submitted by the OPOs, make any

necessary adjustments, enter the data

into a database, and calculate the

performance standards. This work must

be completed as early in the year as

possible so that the OPOs can be

notified of the standards, be afforded an

opportunity to verify the accuracy of

their data, and make any changes to the

data prior to the recertification process.

Because, the performance standards are

based on averages, a change in a single

OPO’s data can result in a change in the

standard that could impact upon other

OPOs. We believe that it would be

inequitable to OPOs to delay having the

performance standards available to them

until immediately preceding the

recertification.

Additionally, we must also have

estimates available as early as possible

of those service areas currently served

by OPOs that do not appear to meet the

standards so that any OPO interested in

moving into a service area of a poorly

performing OPO has an opportunity to

prepare a plan for operating in the

service area.

The only alternative we have to

collecting data within 15 days of the

end of the performance period is to

change the base years from which we

calculate the standards. That is, we

could calculate the performance

standards for the 1996 redesignation

using data from 1993 and 1994 rather

than 1994 and 1995. We find this

alternative unsatisfactory. We believe

that it is important that the data used to

evaluate an OPO’s suitability for

redesignation reflect the most recent

performance of an OPO. The use of old

data could result in our terminating the

agreement of an OPO that has just

completed an outstanding performance

year because the OPO did not meet the

criteria 2 or 3 years ago.

We note that very few OPOs appear to

have difficulty with the data collection

process and due date once they have

gotten used to the process. For example,

only six OPOs did not file their data
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19733

timely in response to our 1995

collection effort. Further, none of the

OPOs called us to complain that the

timeframe was unworkable or

unreasonably difficult.

C. Provisions of the Final Rule With

Comment Period

We have not made any revisions to

§ 486.306(t) in this final regulation with

comment period. We have, however,

removed the introductory paragraph of

§ 486.310 containing operational

instructions regarding the counting of

organs. We are removing these

instructions from the OPO regulations

because they will be more appropriately

placed and more easily updated in an

operational manual.

VII. Performance Standards (§ 486.310)

A. Background

Section 485.306 (now § 486.310) lists

the performance standards for OPOs. In

the proposed rule, we proposed

revisions to this section to state that we

would not ‘‘redesignate’’ any OPO that

fails to meet the performance standards

contained in this section. We also

revised § 485.306(b) (now § 486.310(b))

to distinguish between an OPO which

has not previously been designated by

us for a particular service area and a

redesignated OPO with respect to the

exemption from meeting the

performance standards in § 485.306(a)

(1) and (2) (now § 486.310(a) (1) and (2))

for 2 years.

In the interim final rule with

comment period, we revised the

proposal to add the performance

standards that OPOs must meet

beginning January 1, 1996. An OPO

must meet the primary performance

standard by achieving at least 75

percent of the national mean for four of

the five performance categories over 2

calendars years before the year of

redesignation. The performance

categories are:

• Actual donors per million

population.

• Kidneys recovered per million

population.

• Extrarenal organs recovered per

million population.

• Kidneys transplanted per million

population.

• Extrarenal organs transplanted per

million population.

In addition to the primary

performance standard, the interim final

rule provided for three additional

performance standards. An OPO must:

• Procure organs from an average of at

least 24 donors per calendar year in the

2 calendar years before redesignation.

• Maintain an average procurement

ratio of three organs per donor.

• Enter into a working relationship

with any hospital or transplant center in

the OPO’s service area that requests a

working relationship.

For the purpose of measuring

adherence to the performance standards,

organs removed en bloc and

transplanted en bloc are counted as a

single organ.

In addition, § 485.306 (now § 486.310)

permits an OPO to submit corrected

information if it believes the data used

to apply the performance standards

were inaccurate. It also allows us to

grant an exception from some of the

performance standards to OPOs

operating outside the contiguous United

States.

B. Public Comments and Our Responses

Comment: One commenter suggested

that performance measures be

reevaluated annually to ensure that the

system can incorporate a superior model

for assessing underlying donor potential

that is under development.

Response: We intend to continually

reevaluate the performance standards as

new data become available. We believe

it is unnecessary to commit to an annual

reevaluation because it is unlikely that

new measures will surface at a rate that

would indicate that the existing

standards are antiquated that quickly.

Nonetheless, readers can be assured that

we will continue to monitor research

and experience to further refine and

perfect performance standards. Any

proposed changes in the standards will

be published for public comment before

being effectuated.

Comment: One commenter noted that

performance standards based on

potential would be more accurate and

effective than the ones specified in the

regulation.

Response: We do not agree with the

commenter that standards based on

potential performance are superior to

standards based on actual performance.

We believe it would be inappropriate for

us to certify any except a new OPO

based on its potential to perform at a

certain level, if the OPO is not achieving

a certain level of that potential. For

example, an OPO could service an area

with the potential to produce 100 organ

donors and significantly higher than

average organs per million population.

However, if that OPO does not actually

achieve 24 donors and 75 percent of the

national average organs per million

population, we believe strongly that it

would be inappropriate for us to ignore

the actual performance and continue to

certify the OPO based on its potential

performance.

Comment: One commenter expressed

concern that the performance criteria

disproportionately accentuated recovery

over transplantation. That is, the

commenter noted that three of the

primary performance standards related

to recovery (that is, donors per million,

kidneys recovered, and extrarenal

organs recovered), while only two

related to transplantation (that is,

kidneys and extrarenal organs

transplanted). The commenter believed

this emphasis on recovery over

transplantation does little to accomplish

the primary goal of OPOs—providing

transplantable organs for thousands of

waiting recipients. The commenter was

concerned that such an emphasis may

result in increased discard rates.

Response: We believe that both organ

recovery and transplantation are critical

areas of OPO performance that need to

be monitored. We acknowledge that the

commenter is accurate in noting that the

primary performance criteria do slightly

emphasize recovery over

transplantation. One of the primary

reasons for this is that an OPO can more

directly influence the recovery rate than

the transplant rate.

While we acknowledge that a small

portion of the organs discarded are

within the control of the OPO through

tasks such as thorough medical history

taking, we believe the majority of organ

discards occur for reasons that are

beyond the OPO’s control. For example,

surgical nicks, damage to the organ

during removal, and diseases that were

unknown to the family or not reported

in medical records account for many

discards.

While we believe it is important to

hold OPOs accountable for making

every effort to avoid unnecessary

discards, we believe it is unnecessary

and inappropriate to accentuate the

transplantation over recovery. After all,

an organ must first be recovered before

it can be transplanted. Given that there

are but five criteria in the primary

performance standard, we continue to

believe that it is appropriate to have

three recovery-related criteria and two

transplant-related criteria. We note that,

for the most part, the OPO industry

widely supports this division.

Comment: Another commenter

expressed concern that the primary

performance criteria were antiquated in

that they emphasize kidney transplants

almost to the exclusion of other tissues

and organs.

Response: We do not agree with the

commenter that the primary

performance standard

disproportionately emphasizes kidney

transplants ‘‘almost to the exclusion of’’

other tissues and organs. Three of the

five primary standards are not related to

kidney transplants. However, since the
19734 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

number of kidney transplants

significantly outweighs other organ

transplants, we believe it is appropriate

to establish separate standards that look

solely at the kidney recoveries and

transplants as part of overall OPO

performance. Of the 19017 transplants

in 1994, 11,391 or 59 percent were for

kidneys. We believe this high incidence

of kidney organ transplants justify

standards that concentrate exclusively

on that organ. We welcome comments

on whether this emphasis on kidney

transplants is the best course for the

future, given the science of

transplantation.

Comment: One commenter stated that

some OPOs may not meet the extrarenal

organ standards for reasons beyond their

control, such as geography or

availability of transplant surgeons. The

commenter stated that there are no

pancreas, lung, or heart/lung programs

in the commenter’s State so the OPO

often did not recover these organs due

to unavailability of transplant surgeons.

The commenter suggested that if an

OPO is able to demonstrate that it

cannot meet the standard due to such

reasons, it be given credit for

unrecovered organs.

Response: Although we can

sympathize with this OPO’s concerns,

many OPOs are faced with this

situation. Some have developed

mechanisms to facilitate procurement of

extrarenal organs for transplantation in

patients listed at transplant centers

outside their States. Many OPOs are

meeting these goals by utilizing local

surgeons to perform excisions. Other

OPOs are developing relationships with

extrarenal programs to facilitate

placements without impediment from

geographic boundaries.

It is an OPO’s responsibility to

recover all viable organs from all

acceptable donors and facilitate their

placement in suitable recipients. The

performance standards are designed

specifically to encourage more effective

organ retrieval and transplantation. We

believe it would be irresponsible, given

the number of persons awaiting organs,

to modify the performance standards in

any way that would validate the failure

to retrieve transplantable organs.

Therefore, we are not altering the

regulations as suggested by the

commenter. We note that in areas where

geographical boundaries present real

obstacles to placement, such as

noncontiguous States and territories, the

regulations now located at

§ 486.310(c)(1) already adequately

address this issue through an exception

process.

If it is true that viable organs are going

unrecovered because there is no

transplant program for a specific type of

organ in a State, we find a severe

problem exists that should certainly be

corrected. We do not want to encourage

the continuance of the problem by

altering the performance standards.

All organs can be transported at least

500 miles without significant chance of

damage. With few exceptions, this 500-

mile radius goes significantly beyond

State and, generally, OPO service area

boundaries. Consequently, an organ

should be recovered even when the

organ cannot be transplanted in the

State or within the OPO’s service area.

We strongly encourage any OPO that

has adopted the practice of not

recovering organs that it cannot

transplant locally to alter that practice

immediately.

Comment: One commenter suggested

that HCFA include data from all OPOs,

including new OPOs, in the calculation

of the national mean.

Response: We intend to include all

OPOs in the calculation of the national

mean, including new OPOs and those in

noncontiguous States and territories.

However, we believe it is unnecessary to

amend the regulations to specify this

intention. Since the regulatory language

does not restrict the calculation, we

believe it already supports our position

to include all OPOs in the calculation.

Comment: Several commenters

suggested that we substitute deaths per

year as the denominator in the primary

performance criteria is lieu of

population. They believe that logically

this denominator is more directly

correlated to the potential donor pool

and would produce better performance

standards.

Response: The objective of the

performance standards is to establish an

appropriate measure that would enable

us to assess how well OPOs are

maximizing organ resources and

therefore warrant certification by the

Medicare/Medicaid program. As such, it

is important that the data we use to

develop these standards provide an

accurate measure of OPO performance.

Clearly, the use of hospital deaths

versus area population in the

denominator from which these

standards are derived warrants further

investigation. We agree that since OPOs

deal with cadaveric donors, deaths per

year (particularly hospital deaths per

year) is a more targeted measure of an

OPO’s actual potential donor pool.

Therefore, we surveyed the OPOs in an

attempt to collect death data from them

for 1994 so that we could study the

feasibility of using deaths per year as

the denominator. In nearly every State,

OPOs reported problems obtaining

timely data. In at least one State, the

data are not available at all. We were

able to determine, however, that

national death statistics are available

from the National Center for Health

Statistics (NCHS) and the Social

Security Administration (SSA).

Although we have decided to proceed

with the use of population as the

denominator for a number of reasons

discussed below, we are soliciting

public comments on which approach—

population or death statistics—would

best achieve our objectives with respect

to measuring OPO performance.

• Population Data:

For purposes of developing the

performance standards, we use the latest

census data. In addition, adjustments

are made in the population data to

account for hospitals that deal with

OPOs outside the designated OPO

service area.

These data are relatively easy to

obtain at minimal, if any, cost to the

OPOs. We are soliciting comment on the

timeliness, cost, and quality of these

data and adjustments to these data.

• NCHS Death Data:

NCHS produces a public use data tape

that contains deaths by county for all

U.S. counties. This tape contains

approximately 2.2 million records per

year. Although death data are available

universally, there are some data

elements that may be missing for certain

areas. The OPO industry has suggested

the use of in-hospital deaths rather than

general death data, and while this could

be obtained from the NCHS tape, certain

areas, such as Oklahoma, do not make

fine distinctions in the hospital site.

Also, we are not certain about the

availability of death data for the United

States territories. The NCHS tape may

allow some finer analysis based on

demographic characteristics that may

better reflect the viable organ pool.

In the United States, the collection of

these vital statistics data is a State

responsibility. Data are gathered by the

States, and each State establishes its

own definitions for terms and coding

rules. Although NCHS conducts a

quality review of the data, it uses the

individual State guidelines to verify the

data were coded appropriately. This

approach, especially in terms of the

definition of ‘‘hospital’’, could affect the

OPO performance standards. In

addition, there is approximately a twoyear delay in the availability of death

data from NCHS.

The NCHS public use tape can be

purchased for $590 per year. Since

performance standards utilize a twoyear average to avoid penalizing OPOs

for short fluctuations in organ donation,

it would cost an OPO approximately

$1200 per redesignation cycle to obtain
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19735

the tapes. At this time, the data file is

only available in mainframe medium.

We expect that most OPOs do not

employ the staff that would be required

to abstract data from the NCHS tapes,

although we would welcome comment

on this point.

The NCHS data does not identify

individual hospitals for any State, and

there may be confidentiality issues that

preclude States from collecting hospitalspecific information. Lack of hospitalspecific data would create a problem in

adjusting the performance data for those

hospitals that deal with OPOs outside of

the designated OPO service area. While

for most OPOs the impact of hospitals

dealing with alternative OPOs is

minimal, there are several OPOs where

the impact of such hospital choices is

very significant.

• SSA Death Data:

Although we may be able to obtain

timely death data through the Social

Security Administration, we know

through experience that there are a

small number of deaths that are not

reported accurately. Our experience

with using these data in our intramural

research indicates it is approximately 98

percent accurate. However, we are very

concerned with use of data that the

OPOs cannot verify. We are further

investigating the timeliness, cost and

quality of the SSA mortality data. We

are interested in receiving public

comment on this data source.

• Other Policy Implications:

We are concerned about the impact of

using death as the denominator for

those OPOs servicing large urban areas.

Urban areas may have a higher death

rate among apparently suitable donors,

however, there is a lower donor consent

rate among the minority population and

a higher likelihood that a potential

donor will be an HIV risk or present a

history of substance abuse. Therefore, in

these cases, the death rate may not

accurately define the potential donor

pool and may disproportionately affect

OPOs serving large urban areas. We may

not want to establish a performance

standard that may systematically bias a

particular group of OPOs.

We conducted an impact analysis

comparing the use of 1991 death data

(the most recent data available at the

time of our analysis) and population

data as denominators in calculating

performance standards. We determined

that the use of death data would not

significantly alter performance

outcomes compared to using population

data. However, three OPOs servicing

major urban areas would not meet the

performance standards if death data

were substituted for population data,

provided that the performance

standards is not also changed. We

acknowledge that if the denominator

used to measure performance were

changed, the performance standard

itself could in principle be changed, and

solicit comments on this issue.

While research is being conducted on

determining adjustment factors that

would allow for normalization of death

or population data to account for

demographic factors, we are not aware

of a generally accepted adjustment

methodology at this time.

In summary, we are soliciting

comments on the approaches discussed

above with respect to use of population

versus death statistics (from either

NCHS, SSA or some other national

source) as a denominator for measuring

performance. Specifically, we are

interested in comments concerning the

timeliness, cost, and validity of the

various data sources. We would also

appreciate suggestions concerning

possible adjustments to account for

varying demographic factors across

areas, as well as any other potential

changes in the performance measures

that could be used in conjunction with

death data.

Comment: One commenter suggested

that any adopted performance standards

include adjustment for demographic

risk factors related to the population of

the service areas. The commenter

suggested historical consent rates and

medical suitability rates of potential

donors.

Response: We acknowledge that

intuitively it would seem to be more

difficult to achieve performance

standards in some service areas than in

others. However, the impact analysis we

conducted based on 1994 AOPO data

does not support the assumption that

the unadjusted population-based

performance standards would

disproportionately impact on those

population bases that have higher

demographic risk factors. Rather, it

appears that the selected performance

standards appropriately identify those

OPOs that have not achieved designated

performance standards based on factors

that are within the OPO’s control. For

the most part, those OPOs with high

demographic risk factors do not appear

to have difficulty meeting the standards.

For example, the California Transplant

Donor Network exceeds the mean of all

five of the performance standards while

servicing San Francisco, which has one

of the largest HIV populations in the

country. Similarly, most OPOs servicing

populations that have historically had

low consent rates also appear to meet

the standards.

Finally, the commenter did not

propose an empirical value to be used

to adjust for these risk factors. Although

we are aware of ongoing research in this

area, we have not found literature that

unequivocally supports a method to

calculate exact demographic risk factors

that would appropriately adjust the

planned performance standards. We are

interested in any empirical research in

this area. We intend to continue to

monitor the research and will consider

any significant findings for future

refinement of the standards.

We are very interested in the

development of alternative performance

criteria that would be consistent with

our goals of increasing organ donation,

setting achievable threshold levels of

acceptable performance that are realistic

and fair to all the OPOs. Unfortunately,

we have not been able to ascertain

empirical evidence regarding the

correlation between adjustment factors

and donation. That is, to the best of our

knowledge organ donation is influenced

by a myriad of factors. An area that has

a high incidence of some factor that

would seem to decrease donation may

also have a high incidence of another

factor that would seem to increase

donation. We are not aware of any

regression analysis or other statistical

studies that would allow us to

appropriately adjust performance

indicators for idiosyncracies of a

geographic area.

Nonetheless, we are very interested in

further refining the performance

standards. We specifically invite the

public to comment on any alternative

performance measures that are

supportable by empirical evidence.

We should point out, however, that it

appears that the rigorous performance

standards we have selected are

providing the appropriate incentives to

increase organ donation. Based on the

unverified 1995 performance data

reported, there has been an increase of

262 donors in 1995 over 1994, resulting

in over 1100 additional organs being

procured. We find these statistics very

gratifying and may demonstrate that the

use of rigorous performance standards

significantly benefits the public

awaiting transplantation.

Comment: Two commenters noted

that many OPOs deal with hospitals

outside of the designated service area.

They asked if we would calculate the

appropriate, actual population served by

an OPO in applying the performance

standards.

Response: As noted above, we believe

that approximately 200 hospitals deal

with OPOs outside their service areas.

We recognize that this arrangement can

contribute to an OPO’s failure to meet

the performance standards based on

servicing a designated area. The
19736 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

regulations at § 486.310(c)(3) specify an

OPO may provide documentation to us

to support an adjustment in its

population rate if one or more hospitals

in its designated service area have

agreements with alternative OPOs.

Operationally, we have implemented

this provision by soliciting actual

population data from each OPO. We

asked the OPOs to advise us when a

population adjustment is appropriate.

We then ascertained appropriate

population adjustments through

discussions with the alternative OPOs,

the hospitals in question, and the HCFA

regional offices. We note that effective

January 1, 1996, a hospital may deal

with only one OPO. We believe this

requirement will make it easier to

allocate population as the entire

hospital service area will be designated

to the one OPO with which it has an

agreement. As noted above, we

calculated the performance standards

based on the reported data, asked OPOs

to verify the accuracy of their submitted

data, and provided OPOs an

opportunity to request further

adjustments.

We believe that the process we

developed provides an opportunity for

equitable adjustments to the population

data and holds an OPO accountable for

all of the hospitals it serves—including

hospitals outside of its designated

service areas.

Comment: One commenter noted that

research currently underway at the

Harvard School of Public Health could

potentially lead to a more accurate

methodology for measuring OPO

performance. The commenter requested

that the current performance measures

be reevaluated annually to ensure that

more current research does not produce

a superior mechanism for evaluating

performance.

Response: We are pleased to see that

there is research ongoing in this area.

We will be very interested in the results

and will consider them fully when the

research is complete. While we are

always open to improving the

mechanism for evaluating OPO

performance from any interested source,

we believe it is unnecessary and

inappropriate to commit to an annual

reevaluation in the regulations. OPOs

must know in advance to what

standards they will be held, so that they

can make appropriate plans and changes

in their procurement strategies. If the

research proves to be superior as the

commenter believes, we will issue a

proposed notice in the Federal Register

for public comment. Changes in the

performance standards will only be

made after the public has had an

opportunity to review and comment on

the proposal.

Comment: Two commenters suggested

that we develop more appropriate

criteria for the noncontiguous States and

territories. They noted that Puerto Rico

has historically had extremely poor

success with organ procurement and

would fail to meet the planned

standards of 50 percent of the national

mean.

Response: We acknowledge the

historically small number of organ

donations in Puerto Rico. We note,

however, that other noncontiguous areas

such as Hawaii have had higher

donation rates. We feel challenged to

develop a standard that would provide

an incentive for improvement for Puerto

Rico without being so lax as to fail to

present any challenge to Hawaii at all.

We note that the performance standards

for the noncontiguous States and

territories are limited exclusively to

kidneys procured and transplanted. For

this single organ, the standard is 50

percent of the national average.

During 1994, a new OPO assumed

responsibility for Puerto Rico. Under the

guidance of this new OPO, we are

optimistic that Puerto Rico will

eventually meet this performance

standard. In the meantime, we do not

intend to allow a service area that

contains a hospital to go unserved.

Thus, we have revised the regulations to

specify that an OPO that does not meet

the performance standards will not be

terminated as long as another OPO does

not compete for the territory

(§ 486.310(c)). Given this change in the

regulations, we believe it is acceptable

to retain the standards for the

noncontiguous States and territories. An

OPO may continue to be designated for

Puerto Rico even if it does not meet the

performance standards as long as no

other OPO competes for the service area.

If another OPO demonstrates that it can

achieve better performance in the area,

we believe that it is appropriate to

terminate the low performing OPO and

give the alternative OPO an opportunity

to achieve higher organ donation.

Comment: Several commenters were

concerned that the primary performance

standard of achieving at least 75 percent

of the national mean for four out of the

five performance categories is absolutely

mandatory. They believed that OPOs

should have an opportunity to provide

a corrective action plan for the primary

performance standards rather than be

terminated. Another OPO suggested that

OPOs not meeting the primary

performance standard be placed on

probation for one year.

Response: We, together with staff in

the Health Resources and Services

Administration, have long believed that

there are many more potential organ

donors available than are currently

being identified by the OPOs. For

example, there are nearly 5,000

hospitals in this country that have not

identified a single organ donor over a 3-

year period. Based on recent research

from the Johns Hopkins University, we

believe that approximately 850 of these

hospitals have donor potential. While

there are a myriad of reasons for failure

to identify all potential organ donors

and to convert all potential donors to

actual donors, a major influence on

organ donation is unquestionably the

OPO.

We believe that the establishment of

primary performance standards at 75

percent of the national average is a

reasonable standard. We hold no OPO

accountable to an arbitrary number but

rather look only to its peers. We are not

aware of geographical factors that by

themselves make it impossible for an

OPO to meet the standards in certain

service areas. Rather with a 25-percent

margin of error off the mean, we believe

that the most influential factor to

performance is the OPO itself.

We intend these performance

standards to serve the people on the

transplant waiting lists in all areas of

the country by fostering the most

efficient OPO service for them. We

believe that all Americans, regardless of

whether they are Medicare or Medicaid

beneficiaries, deserve to be serviced by

OPOs that make every effort and use

every skill available to procure

transplantable organs so that lives may

be saved or improved through timely

organ transplants.

Consequently, we believe it is

important to hold each OPO

accountable for meeting the primary

performance standard. If the OPO that is

assigned to a service area is not

achieving appropriate organ donation

rates, we would be acting irresponsibly

to the Americans on the waiting list to

allow that OPO to continue to serve that

area rather than replace it with another

better-performing OPO.

However, we equally believe we

would be acting irresponsibly to allow

an area to go unserved rather than to

permit an OPO an opportunity for

improvement. Therefore, we are altering

the regulations to permit an OPO that

does not meet the performance

standards to retain its certification and

submit a corrective action plan, if no

other OPO that is performing acceptably

is willing to assume the service area.

When an OPO does not meet the

primary performance standard, we will

solicit interest in assuming the territory

from other OPOs. When another higher-
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19737

performing OPO wants to assume the

service area, we believe that we should

make the potentially superior service

available in that area. In those cases

where no other OPO expresses an

interest in assuming the service area, we

will allow the poor-performing OPO to

submit a corrective action plan and

retain its certification for an additional

2-year period.

Comment: Several commenters

thought that the performance standard

requiring OPOs to maintain an average

procurement ratio of three organs per

donor should be eliminated. Many of

them thought that the standard would

discourage innovative practices by

OPOs, particularly those related to

procuring organs from older donors.

Response: We had originally intended

the use of a static number standard,

such as the 3 organs per donor and 24

donors per year standards, as part the

performance standards to ensure that

the standards remained rigorous over

time. We wished to safeguard against

the industry as a whole becoming lax in

performance and driving the national

average to artificially low numbers.

Upon further reflection, we believe

that the use of static number

performance standards is unnecessary

and could result in a burden on the

OPOs if we required the submission of

justification or corrective action plans

when these standards are not met. In

conducting an impact analysis of these

performance standards, we found that

all OPOs that did not meet the three

organ per donor standard also failed to

meet the primary performance standard.

Consequently, we anticipate that this

standard in and of itself would have no

immediate impact.

We also recognize that industry

changes that could result in these static

number standards not being met may

not necessarily be detrimental. For

example, innovative practices, such as

procuring organs from older donors, can

result in a net increase in organs

available even though the standard may

not be met. We do not wish to

discourage aggressive organ

procurement practices as long as they

promote safe organ acquisition and

show respect for the families of

potential donors. Our principle goal in

the development of performance

standards is to increase the total number

of organs transplanted. Standards that

could potentially deter an OPO from

obtaining every viable organ available

are contrary to our goal. Consequently,

we believe that our goal is best served

if we eliminate the static number

standards and proceed with the primary

performance standards alone.

Comment: One commenter requested

that newly merged OPOs and OPOs

acquiring significant new territory be

granted a grace period for compliance

with the performance standards, similar

to what we permit for newly formed

OPOs. The commenter believed that

failure to provide a grace period would

deter an OPO from expanding its

territory.

Response: The concept of granting a

grace period for merging OPOs and

OPOs acquiring significant new territory

is a difficult one. We recognize that

significant changes in OPO

management, administration, or new

service areas could potentially result in

a temporary decline in performance as

the organization adjusts to the change.

On the other hand, we are extremely

concerned that permitting a grace period

could instill a perverse incentive into

the program. That is, allowing a grace

period could provide an incentive for

two poorly performing OPOs to merge

merely to avoid termination or for OPOs

to enter into bidding wars over service

areas to avoid application of

performance standards. Policies that

promote frequent major changes in the

OPO structure could be counter to our

goals by resulting in decreased rather

than increased organ donations.

After considerable thought, we have

decided to retain our current policy of

not permitting a grace period for newly

merged OPOs or OPOs with significant

changes in territory. We believe that this

will encourage OPOs to undertake such

changes judiciously using careful

thought and extensive planning. It is far

less likely that big OPOs will overstep

their capacity for expansion if they must

maintain high performance standards.

We note, however, that the above

change in policy, related to the failure

to terminate an OPO’s provider

agreement when there is an absence of

interest by another OPO in assuming the

service area, would apply in the case of

newly merged OPOs. That is, a newly

merged OPO will be allowed to

continue in the program even if it does

not meet the performance standards

when no OPO with acceptable

performance levels is interested in

servicing the area.

We expect that, in most cases, there

would be a reluctance on the part of

competing OPOs to move into the

service area of a newly merged OPO

before that OPO has had an extended

opportunity to demonstrate its ability to

perform. We base our expectation on the

realization that repeated changes in

OPO personnel and organization

practices are disruptive to organ

donation and are likely to make it more

difficult for the second OPO to meet its

performance standards as well.

C. Provisions of this Final Rule With

Comment Period

• We have added new § 486.310(c)(2)

to provide that an OPO that is

performing below standards may be

redesignated for a service area if no

acceptably performing OPO is willing to

accept responsibility for the service area

and if the designated OPO submits a

corrective action plan.

• We have reorganized § 486.310(c)

for clarity.

• We have moved the requirement at

§ 486.310(b)(4) (formerly

§ 485.306(b)(4)) that each OPO enter

into a working relationship with any

hospital or transplant center in the

OPO’s service area that requests a

working relationship to § 486.304(b)(8).

• We have deleted § 486.310(b) (2)

through (4) (formerly § 485.306(b) (2)

through (4)) relating to the non-primary

performance standards for redesignation

after January 1, 1996. We are making

conforming changes to various other

sections to delete references to these

sections.

VIII. Definition of an Open Area

(§ 486.302)

A. Background

In the proposed rule, we added the

definition of ‘‘open area’’ to § 485.302

(now § 486.302). We defined ‘‘open

area’’ as a service area for which we are

accepting applications for designation.

A service area becomes open for

competition once the normal 2-year

designation period or brief interim

redesignation period has expired, when

the designated status of the existing

OPO is terminated, or when no OPO

previously has been designated for the

area. In the interim final rule with

comment period, we modified

§ 485.308(a) (now § 486.316(a)) to clarify

that, based upon the language in

§ 485.302 (now § 486.302), it is the

OPO’s provider agreement with HCFA

(not the OPO itself) that can be

terminated.

B. Public Comments and Our Responses

Comment: A few commenters

requested clarification of the concept of

an open area. The commenters believed

that, if an OPO meets the performance

criteria, no other OPO should be

allowed to compete for its service area.

Response: It is the intent of the law to

encourage the most effective organ

procurement and allocation system.

During various Congressional hearings

on transplant issues, the Congress has

made it clear that it supports as
19738 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

equitable a system as possible. We

believe it is the Congress’ expectation

that we establish conditions in the

Medicare and Medicaid program that

provide incentives for OPOs to operate

as efficiently and effectively as possible

in procuring lifesaving organs.

Consequently, we believe that the law

does not in any way intend to assure

OPOs a monopoly simply because they

barely meet the Medicare performance

criteria. The structure of the statute,

which allows only a single OPO to be

designated in any given area, sets up an

inherently competitive system. Thus, it

is appropriate and in keeping with the

principles of our national economy to

permit competition regardless of the fact

that an OPO is meeting the performance

criteria.

We intend to designate the best

performing OPO for each service area.

We believe it is inappropriate to

designate a marginally performing OPO

for a service area simply because it has

operated in that area previously if a

peak-performing OPO is also competing

for the area and has the support of the

hospital community. However, we

recognize that organ donation is a

voluntary action. Therefore, to perform

well in an area, any OPO must have the

support and cooperation of the

community. The ‘‘tie-breaking’’ criteria

we will use to adjudicate the

competition are specified at § 485.308(a)

(1) through (6) (now § 486.316(a) (1)

through (6)). These criteria emphasize

the relationship between the OPO and

the hospitals in the service area, the

proximity of the OPO to the area, and

past performance.

With regard to the explicit request for

clarification of the open area

designations, every county in the

country is open for competition at

redesignation time. Currently, most

OPOs are in two-year designation

periods that end April through June

1996 and every two years thereafter.

Thus, an OPO may compete for any

county, or all counties in an MSA, that

it believes it can serve better than the

existing, designated OPO at that time.

To bid on an open area, the OPO must

notify the HCFA regional office of its

intention. The regional office will

advise the existing, designated OPO of

the competition and request the

necessary information to evaluate the

proposals.

In addition to the open area

competition that may occur at

redesignation time, an area will be

declared open if the provider agreement

with the OPO serving the area is

terminated or if no OPO has been

designated for the area. There are a

number of counties that do not contain

hospitals. Consequently, no OPO had

been designated for these counties in

prior designation periods. We believe

that every county should have a

designated OPO to work within the

community. Therefore, we instructed

our regional offices to designate these

counties based on the affiliation of the

hospital from which the majority of the

residents seek care. That is, we asked

the Regional Offices to designate these

counties to the OPO servicing the

hospital that is used routinely by the

majority of the residents.

We had considered designating the

county to the hospital furnishing trauma

care to the locality. However, we

decided to designate the OPO of the

local hospital because the nearest

trauma facility may be located very far

away. We believe that designating the

area to an OPO that is a great distance

away is likely to be a deterrent to the

OPO’s ability to serve the community.

Finally, we point out that the final

regulation states explicitly a policy

HCFA has applied administratively in

implementing the OPO redesignation

process. We have historically allowed

competition for OPO service areas

designations at time of redesignation.

Further, we would accept a bid for a

service area for undesignated counties

or the service area of a terminated OPO

at any time should an entity apply. Such

competition has been minimal. We do

not expect this to change with the

inclusion of this policy in the

regulations. It is generally accepted that

OPO-hospital relationships may make

procurement more difficult during the

transition. Since OPOs acquiring new

service areas will continue to be held to

rigorous performance standards, we do

not believe OPOs will seek expansion

without considerable thought and

planning.

Comment: Another commenter noted

that the interim final rule did not list

the factors that would be used to

adjudicate the designation of a service

area that is being contested. The

commenter suggested the following

factors: procurement rate, satisfaction of

transplant centers with service provided

by the OPO, organ procurement costs,

response time to donor referrals, extent

and effectiveness of professional and

public education, established patterns of

organ donor referrals, organ discard rate,

and donor hospital satisfaction.

Response: We did not reprint the

factors that would be considered in

adjudicating contested service area

designation because we did not intend

to change the regulations. As noted

above, the factors are listed at

§ 486.316(a) (1) through (6). Many of the

factors noted by the commenter are

included in these regulations. These

factors follow.

(1) Prior performance, including the

previous year’s experience in terms of

the number of organs retrieved and

wasted and the average cost per organ;

(2) Actual number of donors

compared to the number of potential

donors;

(3) The nature of relationships and

degree of involvement with hospitals in

the organization’s service area;

(4) Bed capacity associated with the

hospitals with which the organization

has working relationships;

(5) Willingness and ability to place

organs within the service area; and

(6) Proximity of the organization to

the donor hospitals.

As noted above, we have not

heretofore experienced a significant

amount of competition among the

OPOs. Thus, we have only limited

experience with these criteria. If

competition increases among the OPOs

as a result of this final rule with

comment period, we will consider

revising the factors in the future. In that

regard, we will give consideration to the

factors noted by the commenter. We will

also publish a proposed notice of these

changes in the Federal Register and

invite public comment on the proposal.

C. Provisions of This Final Rule With

Comment Period

As we stated above, we are making no

revisions in the definition of ‘‘open

area’’ at this time.

IX. Termination of an OPO’s Provider

Agreement (§ 486.325(b))

A. Background

In the interim final rule, we added

§ 485.311 (now § 486.325(b)) to specify

the conditions for both voluntary and

involuntary termination of an OPO’s

provider agreement. For a voluntary

termination, we required that the OPO

provide us with a written notice of its

intention with a proposed termination

date. We will take action to approve the

request as submitted or take other action

to ensure that there is no disruption in

services in the affected service area.

For an involuntary termination, we

may terminate an agreement if we find

that an OPO no longer meets the

conditions of coverage. Under

§ 485.311(b) (now § 486.325(b)), we

indicated we would give 15 days notice

of termination. We also set forth an

OPO’s appeal rights, the requirement

that an OPO give prompt public notice

regarding the voluntary termination,

and reinstatement provisions.

We made editorial changes to this

section as part of the interim final rule
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19739

with comment period but we did not

make any significant changes in the

substance.

B. Public Comments and Our Responses

Comment: One commenter believed

that a 15-day notice of termination, if

used, could lead to serious disruption of

organ procurement efforts. The

commenter urged a minimum notice

requirement of 90 days.

Response: The added the 15-day

termination notice is included in the

OPO regulations to be consistent with

the treatment of providers under the

Medicare program. It is common

practice in the Medicare program to give

providers a 15-day notice of termination

of their agreement to participate in the

Medicare program for failure to comply

with the conditions of coverage.

However, upon further reflection, we

can see some significant differences

between certification of Medicare

participating providers and

certification/designation of an OPO that

may warrant an alternative policy for

OPO termination. Most notably,

providers are generally terminated for

serious and imminent health and safety

reasons, while OPOs are most likely to

be terminated for failure to meet

performance standards. While it is

possible for an OPO to be terminated for

a health and safety reason, such as

procuring organs from HIV-infected

donors, such a termination has not

occurred to date. Consequently, we

expect that such an occurrence would

occur very rarely, if at all. Thus, in the

case of serious health and safety issues,

it is important to protect the health and

safety of our beneficiaries by proceeding

with termination expeditiously.

However, we believe that because no

serious harm is likely to befall anyone

if we move more cautiously with

termination of an OPO’s provider

agreement, we can consider an extended

termination notification period.

In addition, Medicare beneficiaries

generally have easier access to

alternative health care when a provider

of health care services is terminated.

That is, while a Medicare beneficiary is

no doubt inconvenienced somewhat

when the provider of choice is

terminated from the program, 15 days is

generally enough notice for the

beneficiary to locate an alternative

source of care within the area. In the

case of an OPO, however, the situation

is significantly different. That is, an

OPO does not furnish health care

services directly to the beneficiary, and

there are no generally available

alternative OPOs within easy access.

Thus, in the case of OPOs, expeditious

termination of the entity could present

a significant problem to the providers

who have an agreement with the OPO.

We note that we are changing the

process for termination somewhat from

that in the interim final rule with

comment period. That is, we have

concluded that we will not necessarily

terminate an OPO that does not meet the

primary performance standard if no

other OPO is willing to assume the

territory. Rather, we will solicit interest

from other OPOs in assuming the

service area. Thus, it seems only

practical to allow for a period in which

to solicit such interest from competing

OPOs before terminating the OPO that

does not meet the performance

standard. To do otherwise would place

an OPO in the anomalous position of

being terminated 15 days after

notification of failure to meet the

performance standards only to be

reinstated within a month or two when

we discover no alternative OPO is

willing to assume the territory.

Consequently, we have modified

§ 485.311 (now § 486.325) to provide

that termination of OPOs will occur 90

days after the notification by the

Secretary that the OPO does not meet

the standards.

C. Provisions of this Final Rule With

Comment Period

We have revised § 486.325(b)

(formerly § 485.311(b)) to provide for a

90-day advance notification before a

termination of an OPO’s provider

agreement becomes effective. Similarly,

we have revised § 486.304(e)(3)(ii)

(formerly § 485.303(e)(3)), relating to

interim designation periods, to extend

the length of such designations to 180

days to take into account the longer

advance notification period to effectuate

terminations.

X. Effective Dates

A. Background

In the September 1994 interim final

rule, we noted that, although the

regulations were effective 30 days after

publication, we would apply the new

qualification and performance standards

for the first time with the recertification

of OPOs that takes place in the spring

of 1996 (for most OPOs, June 1, 1996).

For purposes of the recertification, we

would use data from calendar years

1994 and 1995.

B. Public Comments and Our Responses

Comment: Several commenters

suggested that we delay the effective

date of the regulations to provide for 2

full years of advance notice before we

apply the standards.

Response: Although the actual

regulations were not issued until 9

months into the 24-month performance

period (1994 and 1995), we believe that

OPOs have had adequate advance notice

of the intent to improve performance

through both the law and the notice of

proposed rulemaking that was issued in

June 1991. That is, since 1991, revisions

in the statute relating to OPOs that were

discussed in the interim final rule have

expressed the intent of the Congress that

OPOs be held to rigorous performance

standards. Moreover, while the 1991

notice of proposed rulemaking did not

specify detailed qualification and

performance standards, it included a

discussion of the exact standards we

included in the September 1994 interim

final rule.

We believe that OPOs have had

adequate advance notice that

performance would be monitored and

should have taken appropriate steps to

ensure that they are performing to the

best of their ability. In addition, the

interim final rule was issued only 9

months into the performance period.

Thus, even if an OPO had not been

planning for the rigorous performance

standards, it still has approximately 63

percent of the performance period

remaining to make up for any past

performance problems.

Finally, we note that the primary

performance criteria are based on

national averages. All of the data that

are used to set the actual performance

standards numbers come from actual

performance of OPOs. Since the content

of the interim final rule was not released

until publication, all of the OPOs are

treated equally with regard to

knowledge of the standards. Thus, it is

reasonable to assume that no OPO is

unfairly treated by reliance on standards

that are based on the performance of its

peers. We collected the 1994

performance data from the OPOs.

National averages were calculated and

distributed to the OPOs in 1995. Thus,

each OPO had an indication of what the

performance standards would be and if

it needed to significantly alter its

performance to achieve performance

equivalent to its peers. In addition, the

AOPO has published peer performance

data for OPOs to review and monitor

their own performances throughout the

performance period.

We are anxious to implement

meaningful performance standards for

OPOs. We believe that implementation

of these standards will promote organ

availability and result in additional

lifesaving transplants for not only

Medicare and Medicaid beneficiaries,

but for all Americans in need of organ

transplants. The 1996 recertifications

are for a 2 year period. Thus, if we delay

implementation of the standards beyond
19740 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

the 1996 recertification, the standards

will not be fully effective until June

1998.

Nonetheless, we recognize that the

move to a system of performance and

qualification standards that are

objectively measured and strictly

enforced is a major transition for the

OPO community. Consequently, we are

providing for a transition mechanism for

OPOs that do not meet the standards for

the 1996 redesignation period but are

making progress towards meeting them.

Therefore, we are providing transitional

standards for both the service area size

designation qualification standard and

the performance standards for the 1996

redesignation period.

We will grant an exception to the 24-

donor service area size criterion during

the 1996 redesignation process for those

qualified OPOs that meet the

performance standards in § 486.310. To

qualify for the exception, an OPO must

submit a written request to HCFA that

includes a narrative description of its

plans for meeting the standard by the

1998 redesignation period. We

emphasize that this is a one-time

exception opportunity that will not be

repeated for any OPO after the 1996

redesignation process.

We are also providing a one-time

exception process for OPOs that do not

meet four of the five performance

standards at the time of redesignation.

This exception is limited to those

qualified OPOs that meet three out of

the five performance criteria in

§ 486.310(b) (1) through (5). Similar to

the exception process for the

qualification standard, an OPO must

submit a written request to HCFA

accompanied by a detailed, narrative

description of the OPO’s plans for

ensuring that it will meet the

performance standards by the 1998

redesignation.

C. Provisions of This Final Rule With

Comment Period

We are not making any changes in the

effective dates of the provisions of the

interim final rule with comment period.

We are, however, as explained above,

adding two one-time exceptions for the

1996 redesignation process only.

• We are adding § 486.307(d)(4)

stating that HCFA may grant an

exception to the 24-donor criterion in

paragraph § 486.307(d)(2)(ii) to an OPO

that can demonstrate that (1) it meets

the performance criteria in § 486.310(b),

and (2) it has a specific plan to meet the

service area size criterion in paragraph

§ 486.307(d)(2)(ii) by the 1998

redesignation period.

• We are adding § 486.310(c)(3) to

provide that for the 1996 designation

period only, HCFA may continue to

designate for a service area an OPO that

does not meet the standards under

paragraph (b) of this section if the OPO

(1) meets three of the five criteria in

§ 486.310(b)(1) through (b)(5); and (2)

submits an acceptable corrective action

plan in accordance with § 486.310(d).

XI. Waiver of Service Area

Designations

A. Background

Section 1138(a)(1)(A)(iii) of the Act

had required hospitals participating in

the Medicare program to notify an OPO

of potential organ donors. The use of the

article ‘‘an’’ indicated that a hospital

need not have an agreement with the

OPO whose designated service area

includes the county in which the

hospital is located. Thus, a significant

number of hospitals, for various reasons,

have chosen to have agreements with a

Medicare/Medicaid-certified OPO other

than the OPO designated for their areas.

In fact, several hospitals have

agreements with multiple OPOs.

Sections 155 (a)(1)(A) and (a)(1)(B) of

Public Law 103–432 amended sections

1138 (a)(1)(A)(iii) and (a)(1)(C) of the

Act to add requirements that a hospital

have an agreement for notification of

potential organ donation only with the

OPO designated for the area in which

the hospital is located. Public Law 103–

432 also provided for waiver of the

requirements under certain

circumstances. Section 155(a)(1)(C)

added new section 1138(a)(2)(A) to the

Act. Specifically, the Secretary must

approve waiver requests if (1) the

waiver is expected to increase organ

donations and (2) the waiver will assure

equitable treatment of both those

patients within the service area served

by the hospital’s designated OPO and

those patients within the service area

served by the OPO with which the

hospital seeks to enter into an

agreement under the waiver.

The law is quite specific in

identifying the factors that HCFA may

consider in adjudicating waiver

requests. That is, section 1138(a)(2)(B)

provides that in making a determination

on a waiver request the Secretary may

consider the factors that would include,

but not be limited to (1) cost

effectiveness; (2) improvements in

quality; (3) any change in a hospital’s

designated organ procurement agency

due to a change made on or after

December 28, 1992, in the definitions

for MSAs (as established by the Office

of Management and Budget); and (4) the

length and continuity of a hospital’s

relationship with an organ procurement

agency.

Sections 1138 (a)(2)(C) and (a)(2)(D) of

the Act are quite specific in detailing

the process for the waiver requests.

Effective January 1, 1996, any hospital

seeking a waiver must submit an

application to the Secretary. Within 30

days of receipt of a waiver request, the

Secretary will publish a public notice of

the request offering interested parties a

60-day period to comment on the

request. Allowing HCFA only 30 days to

evaluate the comments and render a

decision would result in a minimum

time period of 120 days for processing

a waiver request.

Section 155(a)(2) of Public Law 103–

432 contains a grandfathering provision

for hospitals which on October 31, 1994,

the date of enactment of Public Law

103–432, have existing agreements with

OPOs other than the OPO designated for

their service areas. Any hospital that has

an agreement with an OPO other than

the OPO designated for its area on

October 31, 1994, may continue the

agreement until HCFA has adjudicated

its waiver request, provided the hospital

has filed a waiver request by January 1,

1996. This provision was included

because it would be disruptive to a

hospital to force it into an agreement

with the OPO designated for its area

while a waiver request is being

processed.

We believe the provisions of section

155 are self-implementing. Thus, we

proceeded with implementation prior to

modification of the regulations or prior

public comment. In October 1995, we

issued Program Memorandum A–95–11

to our intermediaries outlining the

process for making a waiver request. We

instructed each intermediary to notify

every hospital that it serviced of the

opportunity to request a waiver to deal

with an OPO other than the OPO

designated for the area. We advised the

hospitals that we intended to adjudicate

the requests using the criteria set forth

in the law. We advised the hospitals

that, to retain their existing out-of-area

OPO agreements that were in effect as

of October 31, 1994, their waiver

requests must be received by January 1,

1996.

The law did not address the impact of

changes in OPO service areas on future

waiver requests. That is, we note that

changes in OPO service areas are

ongoing events. We anticipate that, with

the implementation of the provisions

contained in the September 8, 1994,

final rule with comment period, such

changes may become somewhat more

frequent. Often these changes occur

through mergers or cooperative means.

Some changes, however, are the result

of competitive actions among the OPOs

with HCFA awarding the service areas
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19741

based on the criteria in § 485.308 (now

§ 486.316). When these changes in

service areas occur, the hospitals in the

affected counties must enter into

agreements with the newly designated

OPO or request a waiver to deal with an

alternative designated OPO.

As noted above, the minimum period

of time necessary to process a waiver

request is 120 days. We believe it is

unproductive and contrary to the goal of

increasing national organ donation to

force the hospitals in affected areas into

new working relationships with a OPO

and then to approve a waiver request

and allow an alternative agreement a

few months later. Such a system would

be disruptive to the hospital and to

effective organ procurement nationally.

Consequently, we are adding a new

provision to the regulations at § 486.316

to permit the grandfathering of existing

agreements between an OPO and a

hospital when changes in a service area

occur pending resolution of the

hospital’s waiver request.

To be eligible for the grandfathering,

a hospital must have had an agreement

with the OPO prior to the changes in

service area and the hospital must have

requested waiver from the provisions of

section 1138 (a)(1)(A)(iii) and (c) of the

Act within 30 days of the effective date

of the change in service area. Of course,

if HCFA denies the waiver request on its

merits (the request does not demonstrate

that it is expected to increase organ

donation and assure equitable treatment

of patients), the hospital must enter into

an agreement with the new OPO for the

area. The regulations provide that such

new agreements must be executed

within 30 days of notification of the

determination on the waiver request.

We recognize that this grandfathering

provision is not explicitly stated in the

law. Nonetheless, we believe the

provision is authorized under section

1138(a)(2)(A) of the Act which vests

broad authority to HCFA to waive the

new requirements of sections

1138(a)(1)(A)(iii) and 1138(a)(1)(C) of

the Act. The provision is also

complementary to the grandfathering

provision specified in section 155 of the

Social Security Act Amendments of

1994. We believe that allowing such a

grandfathering policy during the

processing of the waiver request is the

only means to ensure a smooth

transition and promote organ donation.

Nonetheless, we are providing an

opportunity for public comment in this

final rule with comment period.

B. Provisions of This Final Rule With

Comment Period

We have revised § 486.316 (formerly

§ 485.308) by adding new paragraphs (c)

through (f) to implement section 1138

(a)(2) of the Act and the grandfathering

provisions of section 155(a)(2) of Public

Law 103–432. These revisions permit

grandfathering of a hospital to the OPO

with which it has an historical working

relationship while the hospital’s request

for waiver is being considered when

changes in the OPO designated for the

service area in which the hospital is

located occur beginning January 1, 1996.

We are soliciting comments on this

provision of the final rule with

comment period.

XII. Technical Revisions

We have made the following technical

revisions to the regulations for the

purposes of clarifying and reorganizing

the OPO regulations.

• We amended § 405.2163 by

removing the reference to part 485,

subpart D and replacing it with a

reference to part 486, subpart G to

reflect the earlier published

redesignation of the OPO regulations.

• We revised § 486.301 to add section

1138(a) and (b) of the Act and section

371(b) of the PHS Act as the statutory

bases of the OPO regulations.

• We reorganized § 486.310 to

include the exceptions and exemptions

to the OPO standard requirements under

paragraph (c).

• We deleted § 486.310(e) (previously

designated as § 485.306(e)) as it is

unnecessary and has created confusion

among the OPO industry. This provision

provides that an OPO that has not

previously been designated by HCFA for

a particular service area is exempt from

meeting the performance standards for

its first 2 years of designation as the

OPO for that area. However, the

performance standards are used to

measure the OPO’s qualifications to be

redesignated beginning 2 years after the

OPO has been first designated for any

portion of a service area.

Since there is no data on the OPO’s

performance in the area when it is

newly designated, it would be

impossible to apply the performance

standards at the time of initial

designation. Thus, we believe it is

unnecessary to maintain an exemption

of this nature. The remaining portion of

the provision merely states that we will

apply the normal performance standards

at the time of redesignation. Therefore,

this portion of the regulation is also

unnecessary since, without it, we would

have no alternative but to apply the

normal performance standards.

• We revised the cross-reference in

§ 486.314 (formerly § 485.307) to reflect

the reorganization of the material.

XIII. Waiver of Proposed Rulemaking

We ordinarily publish a notice of

proposed rulemaking in the Federal

Register and invite public comment

before issuing a final document. Most of

the provisions of this rule were open for

public comment through both the June

21, 1991, proposed rule and the

September 8, 1994, interim final rule.

We are now publishing these provisions

as final rules. Because they have

previously been open for comment, we

are not inviting further public comment

on these provisions.

The Social Security Act Amendments

of 1994 were enacted subsequent to the

September 8, 1994, interim final rule

with comment period. Section 155 of

these amendments, relating to OPO

hospital relationships, are inextricably

linked to this final rule. The provisions

of section 155 are self-implementing

and do not require rulemaking.

XIV. Regulatory Impact Statement

We generally prepare a regulatory

impact statement that is consistent with

the Regulatory Flexibility Act (RFA) (5

U.S.C. 601 through 612) unless we

certify that a rule will not have a

significant economic impact on a

substantial number of small entities.

For purposes of the RFA, we consider

all providers and suppliers of health

care as small entities. Individuals and

States are not included in the definition

of a small entity. Also, section 1102(b)

of 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. Such an analysis

must conform to the provisions of

section 604 of the RFA. For purposes of

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

small rural hospital as a hospital that is

located outside of a MSA and has fewer

than 50 beds.

This final rule with comment period

sets forth changes required by Public

Law 100–607, Public Law 101–616, and

Public Law 103–432. In the September

1994 interim final rule with comment

period, we provided an impact analysis

on the provisions of Public Law 100–

607 and Public Law 101–616. In that

analysis, we stated that we expected

that, while OPOs may incur some

additional costs, those costs would be

minimal. We invited public comment

on the impact statement in the interim

final rule with comment period. We did

not receive any public comments.

The provisions of section 155 of

Public Law 103–432 included in this

final rule with comment period conform

to section 1138(a)(2) of the Act to

provide for a waiver of section
19742 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

1138(a)(1)(A)(iii) and (c) of the Act

under certain circumstances. Section

1138(a)(1) requires that a hospital have

an agreement for potential organ

donations only with the OPO designated

for the area in which the hospital is

located. We expect any additional costs

related to this provision to be minimal.

Any hospital wishing a waiver must file

a request with us. We believe, however,

that any additional costs are minimal

compared to the improvement these

provisions will have on the quality of

health care for organ recipients.

We have determined and we certify

that this final rule with comment period

will not have a significant economic

effect on a substantial number of

providers and suppliers. Also, OPOs

(independent and hospital-based) are

not considered small rural hospitals

since OPOs generally service large

geographical areas. Therefore, a

regulatory flexibility analysis under the

RFA and a rural impact analysis under

section 1102(b) of the Act are not

required.

In accordance with the provisions of

Executive Order 12866, this regulation

was reviewed by the Office of

Management and Budget.

XV. Information Collection

Requirements

Under the Paperwork Reduction Act

of 1995, agencies 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. This final rule with comment

period contains information collections

that are subject to review by OMB under

the Paperwork Reduction Act of 1995.

The title, description, and respondent

description of the information

collections are shown below with an

estimate of the annual reporting and

recordkeeping burden. Included in the

estimate is the time for reviewing

instructions, searching existing data

sources, gathering and maintaining the

data needed, and collecting and

reviewing the collection of information.

We are, however, requesting an

emergency review of these regulations.

In compliance with the requirement of

section 3506(c)(2)(A) of the Paperwork

Reduction Act of 1995, we have

submitted to the Office of Management

and Budget (OMB) the following

requirement for emergency review. We

are requesting an emergency review

because the collection of this

information is needed prior to the

expiration of the normal time limits

under OMB’s regulations at 5 CFR. Part

1320 to permit recertification of OPO’s

as required by statute. Failure to issue

these rules in time for the 1996

redesignation process may result in the

termination of OPO agreements. As a

consequence, persons in need of organ

transplants may not receive them. The

agency cannot reasonably comply with

the normal clearance procedures

because public harm is likely to result

if normal clearance procedures are

followed. Without this information, we

could not ensure compliance with this

Congressional mandate.

We are requesting that OMB provide

a 21-day public comment period with a

7-day OMB review period and a 90-day

approval. We will publish a separate

Federal Register notice for an

emergency request for the OPO manual

requirements.

Type of Information Collection

Request: New Collection.

Type of Information Collection:

Conditions of Coverage for Organ

Procurement Organizations.

Form No.: HCFA–R–13.

USE: Organ Procurement

Organizations are required to submit

accurate data to HCFA concerning

population and information on donors

and organs on an annual basis in order

to ensure maximum effectiveness in the

procurement and distribution of organs.

Frequency: Annually.

Affected public: Not-for-profit

institutions.

Number of Respondents: 66.

Total Annual Responses: 66.

Total Annual Hours Requested: 4,096.

To request copies of the proposed

paperwork collections referenced above,

call the Reports Clearance Office on

(410) 786–1326.

The sections in these final regulations

with comment period that contain

information collection requirements are:

• Sections 486.304 (c)(2), (c)(4), (c)(7),

and (c)(8) require that an OPO submit

documentation to HCFA as part of the

conditions for payment. These

requirements include cost reporting,

cost projection, and data to show the

number of organs procured and

transplanted. The OPO must maintain

data in a format that can readily be

continued by a successor OPO.

• Section 486.306(d) requires that an

OPO document that it meets the service

area requirements at § 486.307.

• Section 486.306(t) requires that an

OPO submit to HCFA within 15 days

following the end of the calendar year

information on the service area

population, number of donors, number

of organs procured, and the number of

organs transplanted.

• Section 486.307(a) requires that an

OPO make documentation available to

HCFA to verify that it meets the

requirements for boundary designation,

service area location, and service area

size.

• Section 486.307(d) requires that, for

the 1996 transitional redesignation

period only, an OPO that does not meet

the qualification standards in

§ 486.307(d)(2)(ii) may submit a request

to HCFA for a one-time exception to the

standard if it can demonstrate that it

meets the performance criteria in

§ 486.310(b) and has a specific plan to

meet the 24-donor standard by the 1998

redesignation period.

• Section 486.310(c)(3) requires that,

for the 1996 transitional redesignation

period only, HCFA may continue to

designate for a service area an OPO that

does not meet the standards of

§ 486.310(b) if the OPO can demonstrate

that it meets three of the criteria in

§ 486.310(b)(1) through § 486.310(b)(5)

and if the OPO submits an acceptable

correction plan in accordance with

§ 486.310(d).

• Section 486.310(d) requires that an

OPO that does not meet the performance

standards may continue to be

designated for a service area if no

acceptably performing OPO is willing to

accept responsibility for the service area

and if the OPO submits a corrective

action plan that is acceptable to HCFA.

• Section 486.316 requires that an

OPO submit an application to HCFA if

it wishes to be designated as the OPO

for a service area. Applications are only

accepted if the area is an open area.

• Section 486.318 requires that a

designated OPO notify HCFA if it is

considering a change in ownership or

service area. It must submit the same

information that it supplied at the time

of designation.

• Section 486.325(a)(1) requires that

an OPO that wishes to terminate its

agreement with HCFA send written

notice of its intention with the proposed

termination date to HCFA.

The information collection

requirements concern quantifiable data

for submission to us that document an

OPO’s performance. The respondents

for the information collection

requirements are the 66 OPOs

participating in the Medicare program.

The OPOs are required to keep

performance data on an ongoing basis

and submit a yearly report. The

reporting burden for the collection of all

of this information is estimated to be

1,000 hours per submission.

Other reporting requirements for

special circumstances such as

termination of agreements and requests

for exceptions and exemptions rely on

the same information that an OPO must

submit in its annual report.

Consequently, no extra collection of
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19743

information is required. Since these

submissions depend on special

circumstances, we cannot give the exact

number of submissions. However, since

there are only 66 OPOs participating in

the Medicare program, we expect the

number of these submissions will be

extremely small.

These information collection and

recordkeeping requirements are not

effective until they have been approved

by OMB. The agency has submitted a

copy of this final rule with comment

period to OMB for its review of these

information collections. A notice will be

published in the Federal Register when

approval is obtained. Interested persons

are invited to send comments regarding

this burden or any other aspect of these

collections of information, including

any of the following subjects: (1) The

necessity and utility of the information

collection for the proper performance of

the agency’s functions; (2) the accuracy

of the estimated burden; (3) ways to

enhance the quality, utility, and clarity

of the information to be collected; and

(4) the use of automated collection

techniques or other forms of information

technology to minimize the information

collection burden. Comments should be

sent to HCFA, OFHR, MPAS, C2–26–17,

7500 Security Boulevard, Baltimore,

Maryland 21244–1850.

XVI. Response to Comments

Because of the large number of items

of correspondence we normally receive

on a final rule with comment period, we

are not able to acknowledge or respond

to them individually. However, we will

consider all comments that we receive

related to the waiver process discussed

in section XI of this preamble,

§ 486.316, and the definition of ‘‘donor’’

by the date and time specified in the

DATES section of this preamble, and, if

we proceed with a final rule, we will

respond to the comments in the

preamble of that rule.

List of Subjects

42 CFR Part 405

Administrative practice and

procedure, Health facilities, Health

professions, Kidney diseases, Medicare,

Reporting and recordkeeping

requirements, Rural areas, X-rays.

42 CFR Part 486

Health facilities, Medicare, Reporting

and recordkeeping requirements.

42 CFR Chapter IV is amended as set

forth below:

A. Part 405, subpart U is amended as

follows:

PART 405—FEDERAL HEALTH

INSURANCE FOR THE AGED AND

DISABLED

Subpart U—Conditions of Coverage of

Suppliers of End-Stage Renal Disease

(ESRD) Services

1. The authority citation for part 405,

subpart U continues to read as follows:

Authority: Secs. 1102, 1138, 1861, 1862(a),

1871, 1874, and 1881 of the Social Security

Act (42 U.S.C. 1302, 1320b–8, 1395x,

1395y(a), 1395hh, 1395kk, and 1395rr),

unless otherwise noted.

2. Section 405.2163(f) is amended by

removing the reference to ‘‘part 485,

subpart D’’ and replacing it with a

reference to ‘‘part 486, subpart G.’’

B. Part 486 is amended as follows:

PART 486—CONDITIONS FOR

COVERAGE OF SPECIALIZED

SERVICES FURNISHED BY

PROVIDERS AND SUPPLIERS

Subpart G—Conditions for Coverage:

Organ Procurement Organizations

1. The authority citation for part 486

continues to read as follows:

Authority: Secs. 1102 and 1871 of the

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

1395hh).

2. Section 486.301 is revised to read

as follows:

§ 486.301 Basis and scope.

(a) Statutory Basis. (1) Section 1138(b)

of the Act sets forth the requirements

that an organ procurement organization

must meet to have its organ

procurement services to hospitals

covered under Medicare and Medicaid.

These include certification as a

‘‘qualified’’ organ procurement

organization (OPO) and designation as

the OPO for a particular service area.

(2) Section 371(b) of the PHS Act sets

forth the requirements for certification

and the functions that a qualified OPO

is expected to perform.

(b) Scope. This subpart sets forth—

(1) The conditions and requirements

that an OPO must meet;

(2) The procedures for certification

and designation of OPOs; and

(3) The terms of the agreement with

HCFA, and the basis for, and the effect

of, termination of the agreement.

3. In § 486.304, the introductory text

of paragraph (b) is republished, new

paragraph (b)(8) is added, and paragraph

(e)(3)(ii) is revised to read as follows:

§ 486.304 General requirements.

* * * * *

(b) Requirements for designated

status. To be the designated OPO for a

service area, an entity must do the

following:

* * * * *

(8) Enter into a working relationship

with any hospitals, including transplant

centers, in the OPO’s service area that

request a working relationship.

* * * * *

(e) Designation periods

* * * * *

(3) Interim designation. * * *

(ii) The interim designation period

does not exceed 180 days after the

normal designation period has expired.

* * * * *

4. In § 486.306, the introductory text

and paragraphs (d), (f) introductory text,

(i), (q), and (s) are revised to read as

follows:

§ 486.306 Qualifications for designation as

an OPO.

To be designated as the OPO for a

service area, an organization must, at

the time of application and throughout

the period of its designation, meet the

following requirements:

* * * * *

(d) Document that it has a defined

service area that meets the requirements

of § 486.307.

* * * * *

(f) Have a board of directors or an

advisory board that has the authority to

recommend policies relating to the

donation, procurement, and distribution

of organs. While an OPO may have more

than one board, the members specified

in paragraphs (f)(1) through (f)(5) of this

section must be members of a single

board. The board of directors or

advisory board must be composed of the

following:

* * * * *

(i) Have a system to equitably allocate

donated organs among transplant

patients that is consistent with—

(1) ‘‘Guidelines for Preventing

Transmission of Human

Immunodeficiency Virus Through

Transplantation of Human Tissue and

Organs’’ issued by the Centers for

Disease Control and Prevention (CDC)

that are appended to this subpart; and

(2) Rules of the Organ Procurement

and Transplantation Network (OPTN),

see § 486.308.

* * * * *

(q) Ensure that appropriate donor

screening and infection tests, consistent

with OPTN standards and the CDC

guidelines that are appended to this

subpart, are performed by a laboratory

that is certified in the appropriate

specialty or subspecialty of service in

accordance with part 493 of this

chapter, including tests to prevent the
19744 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

acquisition of organs that are infected

with the etiologic agent for acquired

immune deficiency syndrome.

* * * * *

(s) Ensure that donors are tested for

human immunodeficiency viral markers

consistent with OPTN rules and the

CDC guidelines appended to this

subpart for solid organ donation.

* * * * *

5. A new § 486.307 is added to read

as follows:

§ 486.307 OPO service area size

designation and documentation

requirements

(a) General documentation

requirement. An OPO must make

available to HCFA documentation

verifying that the OPO meets the

requirements of paragraphs (b) through

(d) of this section at the time of

application and throughout the period

of its designation.

(b) Boundary designation. The

defined service area either includes an

entire Metropolitan Statistical Area or a

New England County Metropolitan Area

as specified by the Director of the Office

of Management and Budget or does not

include any part of such an area.

(c) Service area location and

characteristics. An OPO must precisely

define and document a proposed service

area’s location through the following

information:

(1) The names of counties (or parishes

in Louisiana) served or, if the service

area includes an entire State, the name

of the State.

(2) Geographic boundaries of the

service area for which U.S. population

statistics are available.

(3) Total population in service area.

(4) The number of and the names of

acute care hospitals in the service area

with an operating room and the

equipment and personnel to retrieve

organs.

(d) Sufficient size requirements. (1)

Before January 1, 1996, an OPO must

demonstrate that it can procure organs

from at least 50 potential donors per

calendar year or that its service area

comprises an entire State.

(2) Beginning January 1, 1996, an OPO

must meet at least one of the following

requirements:

(i) Its service area must include an

entire State or official U.S. territory.

(ii) It must either procure organs from

an average of at least 24 donors per

calendar year in the 2 years before the

year of redesignation or request and be

granted an exception to this requirement

under paragraph (d)(3) or (d)(4) of this

section.

(iii) In the case of an OPO operating

exclusively in a noncontiguous U.S.

State, a U.S. territory, or a U.S.

commonwealth, such as Hawaii or

Puerto Rico, it must procure organs at

the rate of 50 percent of the national

average of all OPOs for kidney

procurement per million population and

for kidney transplantation per million

population.

(iv) If it is an entity that has not been

previously designated as an OPO, it

must demonstrate that it can procure

organs from at least 50 potential donors

per calendar year.

(3) HCFA may grant an OPO an

exception to paragraph (d)(2)(ii) of this

section if the OPO can demonstrate

that—

(i) It failed to meet the requirement

because of unusual circumstances

beyond its control;

(ii) It has historically maintained a

service area of sufficient size to meet the

criterion in paragraph (d)(2)(ii) of this

section; and

(iii) It has a specific plan to meet the

size criterion in paragraph (d)(2)(ii) of

this section in the future.

(4) During the 1996 redesignation

process only, HCFA may grant an

exception to paragraph (d)(2)(ii) of this

section to an OPO that can demonstrate

that—

(i) It meets the performance criteria in

§ 486.310(b); and

(ii) It has a specific plan to meet the

service area size criterion in paragraph

(d)(2)(ii) of this section by the 1998

redesignation period.

6. Section 486.310 is amended by

removing the introductory text, adding

a heading for paragraph (a); removing

paragraphs (a)(3) and (e); and revising

paragraphs (b), (c), and (d) to read as

follows:

§ 486.310 Condition: Adherence to

performance standards.

(a) Standards before January 1, 1996.

* * * * *

(b) Standards beginning on January 1,

1996. Except as specified in paragraph

(c) of this section, each OPO must

achieve at least 75 percent of the

national mean for four of the following

five performance categories, averaged

over the 2 calendar years before the year

of redesignation:

(1) Number of actual donors per

million population.

(2) Number of kidneys recovered per

million population.

(3) Number of extrarenal organs

recovered per million population.

(4) Number of kidneys transplanted

per million population.

(5) Number of extrarenal organs

transplanted per million population.

(c) Exceptions and exemptions.

(1) Exception based on location. OPOs

operating exclusively in a

noncontiguous U.S. State, a U.S.

territory, or a U.S. commonwealth, such

as Hawaii or Puerto Rico, may be

granted an exception from the

performance standards of paragraph (b)

of this section because of special

geographically related characteristics,

such as difficulty in transporting organs

to the mainland, that impede

satisfaction of the national rate of organ

procurement. They must meet a

standard of 50 percent of the national

average of all OPOs for kidneys

recovered and transplanted per million

population.

(2) Exception because of lack of

competition for a service area. HCFA

may continue to designate an OPO that

does not meet the standards under

paragraph (b) of this section for a service

area if no OPO that meets the

performance and qualification

requirements is willing to accept

responsibility for the service area and if

the designated OPO submits an

acceptable corrective action plan in

accordance with paragraph (d) of this

section.

(3) Exception for 1996 transition

period. During the 1996 designation

period only, HCFA may continue to

designate for a service area an OPO that

does not meet the standards under

paragraph (b) of this section if the OPO:

(i) Meets three of the criteria in

paragraphs (b)(1) through (b)(5) of this

section; and

(ii) Submits an acceptable corrective

action plan in accordance with

paragraph (d) of this section.

(d) Corrective action plans and

corrected information.

(1) Corrective action plans. (i) If a

designated OPO does not meet the

standards of paragraph (a) of this

section, it may submit to the appropriate

HCFA regional office a corrective action

plan explaining why it failed to meet

them and specifying the actions it will

take to ensure it meets those standards

in the future.

(ii) HCFA will not accept corrective

action plans from an OPO for failure to

meet the standards specified in

paragraph (b) of this section unless the

OPO continues to be designated under

paragraph (c)(2) or (c)(3) of this section.

(2) Corrected information. An OPO

may request correction of the

information required by § 486.306(e)

from HCFA throughout the two-year

designation period. HCFA will evaluate

the OPO’s request and may seek input

from other sources, such as hospital

personnel, neighboring OPOs, the OPTN

contractor, and the Census Bureau as

necessary to verify the OPO’s

information before making the changes

requested by the OPO. In addition,
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19745

HCFA will notify an OPO if it does not

meet the performance standards based

on the information reported. Any OPO

so notified may provide corrected

information for consideration within 30

days of receipt of a notice of failure to

meet the standards.

(e) [Removed]

§ 486.314 [Amended]

7. Section 486.314 is amended by

removing the reference to ‘‘§ 485.310 (a)

and (b)’’ and replacing it with a

reference to ‘‘§ 486.310’’.

8. Section 486.316 is amended by

adding new paragraphs (c), (d), (e), (f),

and (g) to read as follows:

§ 486.316 Designation of one OPO for each

service area.

* * * * *

(c) After January 1, 1996, a hospital

must enter into an agreement only with

the OPO designated to serve the area in

which the hospital is located unless

HCFA has granted the hospital a waiver

under paragraphs (d) through (g) of this

section to be serviced by another OPO.

(d) If HCFA changes the OPO

designated for an area, hospitals located

in that area must enter into agreements

with the newly designated OPO or

submit a request for a waiver in

accordance with paragraph (e) of this

section within 30 days of notice of the

change in designation.

(e) A hospital may request and HCFA

may grant a waiver permitting the

hospital to have an agreement with a

designated OPO other than the OPO

designated for the service area in which

the hospital is located. To qualify for a

waiver, the hospital must submit data to

HCFA establishing that—

(1) The waiver is expected to increase

organ donations; and

(2) The waiver will ensure equitable

treatment of patients referred for

transplants within the service area

served by the hospital’s designated OPO

and within the service area served by

the OPO with which the hospital seeks

to enter into an agreement.

(f) In making a determination on

waiver requests, HCFA considers:

(1) Cost effectiveness;

(2) Improvements in quality;

(3) Changes in a hospital’s designated

OPO due to changes in the metropolitan

service area designations, if applicable;

and

(4) The length and continuity of a

hospital’s relationship with an OPO

other than the hospital’s designated

OPO.

(g) A hospital may continue to operate

under its existing agreement with an

out-of-area OPO while HCFA is

processing the waiver request. If a

waiver request is denied, a hospital

must enter into an agreement with the

designated OPO within 30 days of

notification of the final determination.

§ 486.325 [Amended]

9. In § 486.325, in paragraph (b), ‘‘15

days’’ is removed and ‘‘90 days’’ is

added in its place.

10. Appendix A is added to subpart

G to read as follows:

Appendix A to Subpart G of Part 486—

Guidelines for Preventing Transmission

of Human Immunodeficiency Virus

Through Transplantation of Human

Tissue and Organs

BILLING CODE 4120–01–P
19746 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19747
19748 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19749
19750 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19751
19752 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19753
19754 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19755
19756 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19757
19758 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations
Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations 19759
19760 Federal Register / Vol. 61, No. 86 / Thursday, May 2, 1996 / Rules and Regulations

(Catalog of Federal Domestic Assistance

Programs No 93.774, Medicare—

Supplementary Medical Insurance, and No.

13.714, Medical Assistance Program)

Dated: April 15, 1996.

Bruce C. Vladeck,

Administrator, Health Care Financing

Administration.

Dated: April 25, 1996.

Donna E. Shalala,

Secretary.

[FR Doc. 95–10901 Filed 4–30–96; 8:45 am]

BILLING CODE 4120–01–C