Federal Register / Vol. 87, No. 83 / Friday, April 29, 2022 / Rules and Regulations 25413 

3 In deciding whether to invoke the exception by 

making and publishing a finding that this final 

action is based on a determination of nationwide 

scope or effect, the Administrator has also taken 

into account a number of policy considerations, 

including his judgment balancing the benefit of 

obtaining the D.C. Circuit’s authoritative centralized 

review versus allowing development of the issue in 

other contexts and the best use of Agency resources. 

4 In the report on the 1977 Amendments that 

revised section 307(b)(1) of the CAA, Congress 

noted that the Administrator’s determination that 

the ‘‘nationwide scope or effect’’ exception applies 

would be appropriate for any action that has a 

scope or effect beyond a single judicial circuit. See 

H.R. Rep. No. 95–294 at 323, 324, reprinted in 1977 

U.S.C.C.A.N. 1402–03. 

section 307(b)(1).3 This action relates to 

the 2009 Endangerment and Cause or 

Contribute Findings for Greenhouse 

Gases under Section 202(a) of the Clean 

Air Act (‘‘2009 Endangerment 

Finding’’), which are nationally 

applicable, 74 FR 66496 (December 15, 

2009). The 2009 Endangerment Finding 

concerns risks from greenhouse gas 

pollution and contributions to such 

pollution that occur across the nation, 

and the result of the denial of these four 

petitions is that the existing nationally 

applicable 2009 Endangerment Finding 

remains in place and undisturbed. 

Further, both the 2009 Endangerment 

Finding and EPA’s previous denial of 

petitions for reconsideration of that 

Finding were previously reviewed by 

the D.C. Circuit, see Coal. for 

Responsible Regul., Inc. v. EPA, 684 

F.3d 102 (D.C. Cir. 2012) (per curiam) 

(subsequent history omitted). Moreover, 

the 2009 Endangerment Finding 

triggered EPA’s statutory duty to 

promulgate motor vehicle standards 

under section 202(a) of the CAA, for 

which judicial review is also only 

available in the D.C. Circuit and which 

have effects in more than one federal 

judicial circuit.4 For these reasons, this 

final action is nationally applicable or, 

alternatively, the Administrator is 

exercising the complete discretion 

afforded to him by the CAA and hereby 

finds that this final action is based on 

a determination of nationwide scope or 

effect for purposes of CAA section 

307(b)(1) and is hereby publishing that 

finding in the Federal Register. 

Under section 307(b)(1) of the CAA, 

petitions for judicial review of this 

action must be filed in the United States 

Court of Appeals for the District of 

Columbia Circuit within 60 days from 

the date this final action is published in 

the Federal Register. 

Michael S. Regan, 

Administrator. 

[FR Doc. 2022–08925 Filed 4–28–22; 8:45 am] 

BILLING CODE 6560–50–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Parts 410, 414, 488, and 493 

[CMS–3368–F] 

RIN 0938–AT83 

Medicare Program; Accrediting 

Organizations—Changes of Ownership 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), HHS. 

ACTION: Final rule. 

SUMMARY: This final rule adds new 

requirements and a specified process to 

address change of ownership (CHOW) 

for Accrediting Organizations (AOs) in 

regard to the transfer of the existing 

Centers for Medicare & Medicaid 

Services (CMS) approval for the AO’s 

accreditation programs to the new AO 

owner. These regulations are intended 

to provide CMS with the ability to 

receive notice when an AO is 

undergoing or negotiating a CHOW, as 

well as to review the prospective new 

AO owner’s capability to perform its 

tasks after a CHOW has occurred, in 

order to ensure the ongoing 

effectiveness of the transferred 

accreditation program(s) and to 

minimize risk to patient safety. 

DATES: This final rule is effective June 

28, 2022. 

FOR FURTHER INFORMATION CONTACT: 

Caroline Gallaher, (410) 786–8705. 

SUPPLEMENTARY INFORMATION: 

I. Background 

Medicare-certified providers and 

suppliers participate in the Medicare 

program by entering into a provider 

agreement with the Medicare program. 

Medicare-certified providers and 

suppliers include hospitals; ambulatory 

surgical centers (ASCs); skilled nursing 

facilities (SNFs; home health agencies 

(HHAs); hospice programs, rural health 

clinics (RHCs); critical access hospitals 

(CAHs); comprehensive outpatient 

rehabilitation facilities (CORFs); 

laboratories; clinics, rehabilitation 

agencies and public health agencies; 

and End Stage Renal Disease (ESRD) 

dialysis facilities.. To participate in the 

Medicare program, Medicare-certified 

providers and suppliers of health care 

services must among other things, be 

substantially in compliance with 

specified statutory requirements of the 

Social Security Act (the Act), as well as 

additional regulatory requirements 

related to, among other things, the 

health and safety of patients specified 

by the Secretary of the Department of 

Health and Human Services (the 

Secretary). These health and safety 

requirements are generally called 

conditions of participation (CoPs) for 

most providers, requirements for SNFs, 

conditions for coverage (CfCs) for ASCs 

and other suppliers, and conditions for 

certification for RHCs and FQHCs. A 

Medicare-certified provider or supplier 

that does not substantially comply with 

the applicable health and safety 

requirements risks having its Medicare 

provider agreement terminated. 

Section 1865(a) of the Act allows most 

types of Medicare-certified providers 

and suppliers to demonstrate 

compliance with the applicable health 

and safety requirements through 

accreditation by a Centers for Medicare 

& Medicaid Services (CMS)-approved 

accreditation program of a national 

accreditation body, known as an 

Accrediting Organization (AO). This is 

referred to as ‘‘deemed’’ accreditation, 

because, if an AO is recognized by the 

Secretary as having standards for 

accreditation that meet or exceed 

Medicare requirements, any provider or 

supplier accredited by that AO’s CMSapproved accreditation program is 

deemed by CMS to be complying with 

the applicable Medicare conditions or 

requirements. 

We are responsible for providing 

continued oversight of national AOs’ 

Medicare accreditation programs to 

ensure that providers or suppliers 

accredited by the AO meet the required 

quality and patient safety standards. We 

must ensure that the AOs have 

formalized procedures to determine 

whether the healthcare facilities deemed 

under their accreditation programs meet 

the AO’s accreditation standards (which 

must meet or exceed the applicable 

Medicare program requirements). We 

are also responsible for ensuring that the 

AO’s accreditation standards and 

practices for surveying providers and 

suppliers meet or exceed our standards 

and practices for granting approval. 

Additionally, while accreditation by 

an AO is generally voluntary on the part 

of Medicare-certified providers or 

suppliers, accreditation is mandated by 

statute for four supplier-types in order 

to receive payment from Medicare for 

the services furnished to Medicare 

beneficiaries. These four supplier types 

are Advanced Diagnostic Imaging (ADI) 

suppliers, Home Infusion Therapy (HIT) 

suppliers, Diabetic Self-Management 

Training (DSMT) entities, and Durable 

Medical Equipment, Prosthetics, 

Orthotics and Supplies (DMEPOS) 

suppliers. We describe these supplier 

types as ‘‘non-certified’’ because they 

are enrolled in the Medicare program 


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but do not formally enter into a 

participation agreement with Medicare. 

These requirements will affect all of 

the AOs that accredit providers and 

suppliers, including those that are 

enrolled in the Medicare program, and 

those that enter into a participation 

agreement with Medicare. We believe 

that a change of ownership (CHOW) 

could occur with an AO that accredits 

any category of provider or supplier. 

Any national AO seeking approval of 

an accreditation program in accordance 

with section 1865(a) of the Act must 

apply for and be approved by us for a 

period not to exceed 6 years (See 42 

CFR 488.5(e)(2)(i)). The AO must also 

reapply for renewed CMS approval of its 

accreditation program(s) before the date 

the existing approval period expires. 

This requirement ensures that 

accreditation provided by these AOs 

continue to indicate that the providers 

or suppliers accredited are meeting or 

exceeding Medicare standards. 

Regulations implementing these 

provisions are found at 42 CFR 488.1 

through 488.9. 

We have an established process for 

the CHOW of Medicare-certified 

providers and suppliers set forth at 

§ 489.18 and in Chapters 2 and 3 of the 

State Operations Manual (SOM), 

Publication 100–07. Although the 

existing provider and supplier CHOW 

process does not apply to the sale and 

transfer of AOs, it has served as an 

appropriate model for what we are 

requiring for changes of ownership of 

AOs. 

The Medicare regulations at § 489.18, 

as well as the CMS SOM (CMS Pub. 

100–07), outline processes concerning 

how a CHOW of a Medicare certified 

provider or supplier affects Medicare 

participation, such as how a provider 

agreement is automatically assigned to a 

new owner unless the new owner rejects 

assignment of the provider agreement. A 

CHOW takes place when the responsible 

legal entity has changed, and typically 

occurs when a Medicare provider has 

been purchased (or leased) by another 

organization. 

Section 489.18 and interpretive 

guidance in the SOM (Chapters 2 and 3) 

define what constitutes a CHOW, the 

required notice to be provided by the 

current provider to CMS and contains a 

provision regarding the automatic 

assignment of the provider agreement to 

the new owner. This regulation also sets 

out the conditions that apply to 

assignment of the provider agreement to 

the new owner. Section 489.18(a)(1) 

provides that in the case of a 

partnership, the removal, addition, or 

substitution of a partner, (unless the 

partners expressly agree otherwise) as 

permitted by applicable state law, 

constitutes a CHOW. Section 

489.18(a)(2) provides that in the case of 

an unincorporated sole proprietorship, 

the transfer of title and property to 

another party constitutes a CHOW. 

Section 489.18(a)(3) provides that, in 

the case of a corporation, the merger of 

the provider corporation into another 

corporation, or the consolidation of two 

or more corporations, resulting in the 

creation of a new corporation 

constitutes a CHOW. Transfer of 

corporate stock or the merger of another 

corporation into the provider 

corporation does not constitute a 

CHOW. In the new regulations at 

§ 488.5(f), which would govern the 

CHOW process for AOs, we are 

incorporating via cross-reference the 

definitions at § 489.18(a)(1) through (3) 

of what constitutes a CHOW, and 

applying them to AOs. 

Section 489.18(d) provides that where 

there is a CHOW, the provider 

agreement under the new owner is 

subject to all applicable statutes and 

regulations, and to the terms and 

conditions under which it was 

originally issued. This includes 

successor liability for Medicare 

overpayments and penalties. 

Generally, under the existing CHOW 

processes, with certain limited 

exceptions, if a facility’s new owner 

accepts the assignment of the provider 

agreement and CMS Certification 

Number (CCN), the new owner retains 

all the benefits and liabilities of that 

agreement. In such a case the provider’s 

Medicare participation continues 

without interruption. If the purchaser 

(or lessee) elects not to accept automatic 

assignment or transfer of the provider 

agreement, then that rejection is 

considered to be a voluntary 

termination of the existing provider 

agreement. Therefore, the purchaser or 

lessee is considered a new applicant 

and must request initial certification as 

a new provider and obtain a new 

provider agreement. 

It is important to clarify that CMS 

does not approve the actual business 

transaction between entities that result 

in the change of the responsible legal 

entity. Instead, our role when a 

provider’s or supplier’s ownership 

changes is to ensure that a new owner, 

who accepts the automatic assignment 

of the existing provider agreement (a 

CHOW), is eligible for Medicare 

participation. If so, we continue to treat 

the provider as the same entity, with 

only the owner having changed. If the 

new owner rejects automatic assignment 

of the provider agreement, then it must 

seek initial Medicare enrollment and 

certification for the facility, which may 

take several months. Pursuant to 

§ 489.18, a new owner who rejects 

automatic assignment of the provider 

agreement, cannot receive payment for 

any services it may provide for 

Medicare beneficiaries between the date 

it acquires the facility and the date we 

determine that it meets all Medicare 

requirements (including any of the 

CoPs, CfCs, or other requirements). 

The principles that apply when a 

Medicare-certified provider or supplier 

undergoes a CHOW provide a general 

framework as to how CMS will treat 

situations involving a CHOW for an AO, 

though there are some important 

differences. For example, in a CHOW of 

a Medicare-certified provider or 

supplier, CMS approval is not needed to 

transfer the Medicare agreement of the 

provider or supplier that undergoes a 

CHOW, if the new owner decides to 

accept assignment of the Medicare 

agreement. The Medicare agreement is 

automatically transferred to the new 

owner unless the new owner 

affirmatively rejects assignment, and the 

new owner will accept the assigned 

agreement subject to all applicable 

requirements, including health and 

safety standards and liability for 

overpayments. However, in the case of 

a CHOW for an AO, under this 

regulation, CMS’ affirmative approval 

will be needed to transfer the existing 

CMS approval for the AO’s accreditation 

program to a new owner. This policy 

reflects CMS’ desire to ensure that an 

AO’s CHOW does not adversely impact 

its survey and accreditation procedures, 

a change which could impact the health 

and safety of patients receiving services 

from providers and suppliers. 

Currently, the regulations governing 

AOs do not include any provisions 

related to the CHOW process, including 

a process for notifying CMS of pending 

CHOWs for AOs, or other procedures 

which would allow us to review 

information about the proposed transfer 

of ownership of accreditation 

program(s). The current regulations also 

do not provide us with the authority to 

approve or deny the transfer of the 

existing CMS approval for the 

accreditation program(s) to be 

transferred. Under our current 

regulations, we are not typically made 

aware of a sale or transfer of an AO until 

that AO applies for renewal of CMS 

approval of the accreditation program(s) 

or unless we are voluntarily notified of 

the CHOW by the AO (although we 

retain the right to conduct comparability 

or validation surveys in accordance 

with § 488.8). 

After review of the existing CMS 

regulations related to CHOWs, we did 

not believe that we had the explicit 


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regulatory authority to prospectively 

review and approve or deny the transfer 

of the existing Medicare-approval of 

accreditation programs. The purpose of 

such a review would be to ensure that, 

after transfer, the AO would continue to 

ensure that the entities it accredits met 

or exceeded CMS requirements. 

On May 2, 2019, we published in the 

Federal Register a proposed rule 

entitled ‘‘Accrediting Organizations— 

Changes to Change of Ownership’’ (84 

FR 18748) (2019 proposed rule). In the 

proposed rule, we stated that the current 

situation, whereby a change in 

ownership of CMS-approved 

accreditation programs may occur 

without notice to CMS does not provide 

an opportunity for us to review and 

approve or deny the transfer of the 

existing CMS-approval of the 

accreditation programs to be transferred. 

We further stated that this scenario had 

to be addressed so that we could assure 

Medicare beneficiaries that the 

standards and conditions for surveying 

facilities would continue to be met by 

the accreditation programs that were 

transferred to new ownership. We also 

stated that it was possible that the AO, 

after a CHOW transaction, might not be 

viable or equipped to accredit facilities 

under the transferred CMS-approved 

accreditation program(s), due to the new 

owner’s inability to enforce the health 

and safety requirements of CMS. 

Without the authority to require AOs to 

provide us with notice when they are 

contemplating or negotiating a CHOW, 

and the authority to review the ability 

of the prospective new owner’s 

capability to perform the required 

accreditation tasks after a CHOW, we 

are unable to confirm the ongoing 

effectiveness of the transferred CMSapproved accreditation program(s). 

This final rule adds new requirements 

and a specified process to address 

CHOWs for AOs in regard to the transfer 

of the existing CMS approval for the 

AO’s accreditation programs to the new 

AO owner. These regulations are 

intended to provide CMS with the 

ability to receive notice when an AO is 

undergoing or negotiating a CHOW, as 

well as to review the prospective new 

AO owner’s capability to perform its 

tasks after a CHOW has occurred, in 

order to ensure the ongoing 

effectiveness of the transferred 

accreditation program(s) and to 

minimize risk to patient safety. 

To date, there have been two (2) AO 

CHOW requests submitted to CMS. One 

was submitted approximately 20 years 

ago, and the other was submitted on 

November 19, 2020. While we cannot 

predict the frequency with which AO 

CHOW transactions will occur in the 

future, we believe that they could occur 

more frequently than they have in the 

past. 

Requirements for Issuance of 

Regulations 

Section 902 of the Medicare 

Prescription Drug, Improvement, and 

Modernization Act of 2003 (MMA) 

amended section 1871(a) of the Act and 

requires the Secretary, in consultation 

with the Director of the Office of 

Management and Budget, to establish 

and publish timelines for the 

publication of Medicare final 

regulations based on the previous 

publication of a Medicare proposed or 

interim final regulation. Section 902 of 

the MMA also states that the timelines 

for these regulations may vary but shall 

not exceed 3 years after publication of 

the preceding proposed or interim final 

regulation except under exceptional 

circumstances. 

This final rule finalizes provisions set 

forth in the May 2, 2019 proposed rule. 

In addition, this final rule has been 

published within the 3-year time limit 

imposed by section 902 of the MMA. 

Therefore, this final rule is in 

accordance with the Congress’ intent to 

ensure timely publication of final 

regulations. 

II. Provisions of the Proposed 

Regulations 

In the 2019 proposed rule, we 

proposed new procedures for the CHOW 

process for accrediting organizations. 

This proposed procedure would enable 

CMS to determine whether the new AO 

would be able to meet the appropriate 

Medicare requirements to be eligible for 

transfer of the existing CMS-approval 

for the accreditation programs to be 

transferred in the CHOW. 

At § 488.5, we proposed to add a new 

paragraph (f) that would set out the 

requirements and processes for CMS 

review and approval or denial of a 

transfer of the existing CMS-approval 

for accreditation program(s) in a CHOW 

event. 

We proposed at § 488.5(f)(1)(i) that 

any CMS-approved AOs negotiating or 

engaging in a CHOW transaction would 

have to provide notice of this CHOW 

transaction to CMS. At proposed 

§ 488.5(f)(1)(ii) and (iii), we would 

require that this notice be provided to 

CMS in writing no less than 90 days 

prior to the effective date of the transfer 

of ownership. This notice requirement 

would allow CMS to perform an 

evaluation of whether the AO, under the 

new ownership, would (1) be viable or 

equipped to accredit facilities under its 

existing CMS approval; (2) be able to 

enforce the health and safety 

requirements of CMS for that program; 

(3) operate effectively; and (4) continue 

to meet or exceed the Medicare 

standards. 

We would further require the 

prospective new owner or transferee to 

submit certain information to CMS in 

support of their request that the existing 

CMS-approval for the accreditation 

programs to be transferred in the 

CHOW. We proposed at § 488.5(f)(2)(iii) 

to require the prospective new owner or 

transferee to submit the following 

information: (1) The name and address 

of the legal entity that would be the 

owner of the new AO after the transfer 

was completed; (2) the three most recent 

audited financial statements of the 

organization that demonstrate that the 

organization’s staffing, funding, and 

other resources would be adequate to 

perform the required surveys and 

related activities; (3) a transition plan 

that would summarize the details of 

how the accreditation functions will be 

transitioned to the new owner. Section 

488.5(f)(2)(iii)(C) would require that the 

prospective new AO’s transition plan 

include the following information: (1) 

Changes to management and governance 

structures including current and 

proposed organizational charts; (2) a list 

of the CMS-approved accreditation 

programs that will be transferred to the 

purchaser/buyer/transferee; (3) 

employee changes, if applicable; (4) 

anticipated timelines for action; (5) 

plans for notification to employees; and 

(6) any other relevant information that 

CMS finds necessary. 

At § 488.5(f)(3)(i), we proposed to 

require the purchaser or transferee to 

provide a written acknowledgement, 

which states that if CMS approves the 

transfer of the existing CMS-approval of 

the accreditation programs that are part 

of the CHOW transaction, the new 

owner will become managerially, 

legally, and financially responsible for 

the operations of all CMS-approved 

accreditation programs being 

transferred. Upon the finalization of the 

CHOW transaction, the purchaser or 

transferee would be completely 

responsible for the management of the 

business operations of the AO, 

including, but not limited to the day to 

day business operations, the survey and 

accreditation processes, the oversight of 

accredited providers and suppliers, the 

handling of complaints regarding 

accredited suppliers, and compliance 

with all CMS requirements. 

Furthermore, we proposed at 

§ 488.5(f)(3)(ii), to require the purchaser 

or transferee to provide written 

acknowledgment stating that they agree 

to operate the transferred CMSapproved accreditation program(s) 


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under all the terms and conditions 

found at §§ 488.5 through 488.9. 

We proposed at § 488.5(f)(3)(iii), that 

the purchaser or transferee would be 

required to provide a written 

acknowledgement that it would not 

operate the accreditation program(s) it 

acquired as CMS-approved accreditation 

program(s) until it received a notice of 

approval. 

We proposed at § 488.5(f)(4)(i), that 

the parties to the CHOW would be 

required to notify the providers and 

suppliers affected by the CHOW within 

15 calendar days after being notified of 

CMS’s approval or disapproval for 

transfer of the existing CMS-approval 

for the accreditation program(s) to be 

transferred in the CHOW. Additionally, 

we proposed at § 488.5(f)(4)(ii), that if 

the AO or accreditation program(s) 

being acquired were under a 

performance review or under 

probationary status at the time the 

CHOW notice was submitted, the 

purchaser or transferee would have to 

acknowledge such status in writing. We 

believe that the purchaser or transferee 

must understand that when the CMSapproved accreditation program(s) are 

transferred under the CHOW, all current 

terms and conditions, and 

responsibilities are included in the 

transfer. 

We proposed at § 488.5(f)(5), that we 

would publish a notice in the Federal 

Register, which would acknowledge the 

transfer of the CMS-approved 

accreditation program(s) through a 

CHOW event. This notice would also 

state that the purchaser would retain 

this CMS-approval for the transferred 

accreditation programs under the new 

ownership. This notice would be only 

intended to inform the public of the 

ownership change; therefore, the notice 

would not solicit public comments. 

Section 488.5(f)(5) would further 

provide that we would not publish this 

notice after we have issued approval for 

the transfer, without first receiving 

written confirmation that the CHOW has 

taken place. 

We proposed at § 488.5(f)(6), that in 

the event we did not approve the 

transfer of the existing CMS approval for 

the accreditation programs to be 

transferred, we would notify all parties 

to the CHOW transaction in writing. The 

parties to the CHOW would include the 

relevant staff of the transferor and the 

transferee. Therefore, this notice would 

be sent to the relevant parties at the 

existing AO and the prospective 

transferee but not to the providers and 

suppliers accredited by the AO. 

We proposed at § 488.5(f)(7)(i), that, 

in the event we were not made aware of 

a CHOW transaction, or did not approve 

the transfer of the existing CMS 

approval for the accreditation 

program(s) that were to be transferred, 

so long as the CHOW transaction was 

not completed, the transferor AO 

(existing AO) would be able to continue 

operating their accreditation programs 

under the existing CMS approval for 

said accreditation programs. The 

exception to this policy would be in the 

event that our review of the pending 

CHOW transaction revealed 

performance and/or compliance issues 

with the transferor AO that were 

previously unknown to CMS. 

We also proposed at § 488.5(f)(7)(ii), 

that CMS would be able to withdraw the 

CMS approval of an AO’s accreditation 

programs in accordance with 

§ 488.8(c)(3)(ii) and (iii), if a CHOW 

transaction was completed without 

notice to CMS and/or without obtaining 

CMS’ approval for the transfer the 

existing CMS approval of the 

accreditation program(s) to the new 

owner. 

We proposed at § 488.5(f)(8), that in 

the event parties completed the CHOW 

transaction, and the purchaser or 

transferee attempted to operate the 

transferred accreditation programs 

under the CMS-approval granted to the 

previous owner of the accreditation 

program(s), notwithstanding CMS 

disapproval of the request to transfer, 

CMS would withdraw the approval of 

the accreditation programs in 

accordance with the procedures set out 

at § 488.8(c)(3)(ii) and (iii). 

We proposed at § 488.5(f)(9), that, in 

accordance with § 488.8(g), if CMS 

withdrew the existing approval of 

transferred accreditation program(s) 

because a CHOW transaction was 

completed without notice to or the 

approval of CMS, an affected Medicarecertified provider’s or supplier’s 

deemed status would continue in effect 

for 180 calendar days after the removal 

of the existing CMS accreditation 

approval, if the provider or supplier 

took the steps stated in § 488.8(g). First, 

the Medicare-certified provider or 

supplier would be required to submit an 

application to another CMS-approved 

accreditation program within 60 

calendar days from the date of 

publication of the removal notice in the 

Federal Register. Second, the Medicarecertified provider or supplier would be 

required to provide written notice to the 

State Survey Agency (SA) stating that it 

has submitted an application for 

accreditation under another CMSapproved accreditation program within 

the 60-calendar day timeframe specified 

in § 488.8(g). Failure to comply with the 

timeframe requirements specified in 

§ 488.8(g) would place the affected 

Medicare-certified provider or supplier 

under the SA’s authority for continued 

participation in Medicare and on-going 

monitoring. 

The provisions of § 488.8(g) would 

not apply to non-certified suppliers, 

because the statute does not authorize 

SAs to engage in oversight of these 

supplier types. Therefore, we proposed 

at § 488.5(f)(10) that if CMS withdrew 

the existing approval of transferred noncertified accreditation program(s) 

because a CHOW transaction was 

completed without notice to or the 

approval of CMS, an affected noncertified supplier’s deemed status 

would continue in effect for 1 year after 

the removal of the existing CMS 

accreditation approval if the noncertified supplier submitted an 

application to another CMS-approved 

accreditation program within 60 

calendar days from the date of 

publication of the removal notice in the 

Federal Register and provided written 

notice of such application to the CMS 

within such timeframe. Failure to 

comply with the timeframe 

requirements would result in a CMS 

determination that the provider or 

supplier was no longer accredited. 

For non-certified suppliers such as 

ADI and DSMT suppliers, CMSapproved accreditation is required as a 

condition for receipt of CMS 

reimbursement for the services 

furnished to Medicare beneficiaries. If 

these suppliers were suddenly left 

without CMS-approved accreditation 

they would have to seek new 

accreditation from a CMS-approved AO. 

We estimated that it would take no less 

than 6 to 9 months for these suppliers 

to complete the reaccreditation process 

and obtain new CMS-approved 

accreditation. We were concerned that 

during the time that these suppliers 

were undergoing the reaccreditation 

process, they would not be able to 

receive reimbursement from Medicare 

for any services furnished to Medicare 

beneficiaries. For many of these 

suppliers, Medicare beneficiaries make 

up a large portion of their client 

population and provides a large source 

of revenue for them. Therefore, these 

suppliers would be likely to suffer 

significant hardship if left without CMSapproved accreditation for a 6 to 9 

month period. Also, if these suppliers 

were not able to provide services to 

Medicare beneficiaries for an extended 

period of time, it could create access to 

care issue for Medicare beneficiaries for 

the services provided by these 

suppliers. For this reason, we proposed 

accreditation for a 1 year period after 

Federal Register notification that CMS’s 

approval of the non-certified supplier’s 


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accreditation organization was being 

withdrawn. Because we proposed to add 

the same requirements for ADI, HIT, 

DSMT suppliers, and clinical 

laboratories, we would add cross 

references to the provisions in § 488.5(f) 

for these suppliers so that they would be 

subject to the same proposed 

requirements for a CHOW. Specifically, 

for DSMT suppliers at § 410.142, we 

proposed to add a new paragraph (k); for 

ADI suppliers at § 414.68, we proposed 

to add a new paragraph (j); for HIT 

suppliers at § 488.1030, we proposed to 

add a new paragraph (g); and for 

laboratories at § 493.553, we proposed 

to add a new paragraph (e). 

III. Analysis of and Responses to Public 

Comments 

We received 8 public comments from 

an individual, accrediting organizations 

and a hospital association. We have 

reviewed all of the public comments 

received and considered the concerns 

raised by all stakeholders. As a result, 

we have made several revisions to the 

proposed regulation at § 488.5(f) in 

response to public comments. 

Specifically, we have modified 

§§ 488.5(f)(1)(iii) and (iv) and 

§ 488.5(f)(2)(iii)(D). See section IV 

‘‘Provisions of the Final Regulations’’ 

for detail description of these changes. 

A summary of the comments received 

and our responses to those comments 

appear in the paragraphs below. 

A. Notification Requirements 

1. Notice to CMS Requirements— 

§ 488.5(f)(1) 

Comment: One commenter expressed 

support for the 90-day written 

notification of intention to change 

ownership of an AO. The commenter 

stated that this requirement reflects a 

reasonable timeframe for the 

organization to notify CMS of whether 

negotiation or engagement in the intent 

to change ownership is taking place. 

Response: We thank this commenter 

for their support on the written 

notification requirements. 

Comment: One commenter 

recommended that CMS require AOs to 

notify CMS of any ownership change 

within 15 days following the effective 

date of ownership transfer. This 

commenter stated that, by that point, 

CMS would have the authority to review 

characteristics of the new business 

entity and make decisions regarding 

whether the new entity has the 

necessary resources and structure to 

retain deeming authority. 

Response: We thank this commenter 

for their comment, however, we 

respectfully disagree with the 

commenter’s position that CMS would 

not have the authority to review 

characteristics of the new business 

entity and make decisions regarding 

whether the new entity has the 

necessary resources and structure to 

retain deeming authority until after the 

AO is sold or transferred to the new 

owner. We believe that in the case of a 

CHOW for an AO, the new owner might 

have an expectation that CMS’s 

approval of an accreditation program 

would be a transferable business asset or 

an intrinsic part of the accreditation 

program that would automatically 

transfer, along with the accreditation 

programs, to the new owner as part of 

the CHOW process. However, this rule 

clarifies that CMS approval of 

accreditation programs is not freely 

transferable, without regulatory 

oversight, qualifications or conditions. 

CMS approval is not a transferrable 

business asset, but a governmental 

regulatory agency approval. Our 

approval of an accreditation program is 

granted to the existing owner of the AO 

based on that AOs ongoing 

circumstances, as described in the AO’s 

initial and renewal applications for 

deeming authority. Before we could 

agree to transfer the existing approval of 

CMS accreditation program(s) to a new 

AO owner, we would require 

information which provides us with the 

assurance that the AO, under new 

ownership, would: (1) Be viable or 

equipped to accredit facilities under its 

existing CMS approval; (2) be able to 

enforce the health and safety 

requirements of CMS for that program; 

(3) operate effectively; and (4) continue 

to meet or exceed the Medicare 

standards. If CMS finds that these 

conditions are met, then we would 

approve the transfer of the existing CMS 

approval for the accreditation programs 

to be transferred to the new owner. We 

believe that section 1865(a)(2) of the Act 

permits us to look at an AO’s resources 

and procedures at any time. 

Consequently, CMS has the authority to 

perform a prospective review of the new 

owner’s ability to run the AO prior to 

the time of sale or transfer. The purpose 

of this review is to ensure that the AO 

will have financial longevity, will 

provide safe and effective accreditation 

that meets the CMS requirements, and 

ensure that the providers and suppliers 

accredited by the AO, under new 

ownership, will continue to provide safe 

and effective healthcare to patients. 

Further, we note that waiting until 

after the CHOW has occurred to perform 

our review of the new owner’s 

circumstances and qualifications will 

likely be burdensome as well as a 

disservice to the AO itself. If we were 

to find that an AO under new 

ownership was not accrediting facilities 

in accordance with the CMS 

requirements, we will terminate our 

approval for the transferred 

accreditation programs. Also, we will 

investigate the providers and suppliers 

that were accredited between the time 

that the new owner took over and the 

time that the CMS approval for the 

accreditation programs was terminated. 

We will perform this investigation 

because these providers and suppliers 

would have been accredited under 

accreditation programs during the time 

the programs were not being properly 

administered by the AO under the new 

owner. These additional surveys will be 

burdensome for the providers or 

suppliers being surveyed a second time, 

as well as for CMS and our contractors. 

Comment: One commenter suggested 

that the rule should require the AO to 

notify CMS when an AO is 

contemplating undergoing or 

negotiating a CHOW. 

Response: We agree with this 

commenter. Sections 488.5(f)(1)(ii) and 

488.5(f)(1)(iii) require that written 

notice of the CHOW must be provided 

by the AO to CMS no less than 90 days 

prior to the anticipated effective date of 

the CHOW transaction. 

2. Notification Requirements— 

§ 488.5(f)(4) 

Comment: One commenter stated that 

if CMS approved the transfer of 

ownership of an AO, the required 15 

day notice that providers would receive 

would be an inadequate amount of time 

for hospitals to review and enter into 

new contracts with the new AO owner. 

This commenter requested that CMS 

provide at least 3 months’ notice to 

hospitals prior to the change in 

ownership going into effect, to allow 

hospitals time to engage with the new 

owner. This commenter also suggested 

that CMS should consider both print 

and electronic communications to 

satisfy these efforts (that is, U.S. mail, 

email, voicemail follow up by AOs). 

Response: We understand this 

commenter’s concern but respectfully 

disagree. The purpose of the notice 

required by § 488.5(f)(4) is to notify the 

providers and suppliers that have been 

accredited by that AO that CMS has 

approved the transfer of the existing 

CMS-approval for the accreditation 

programs to be transferred in the CHOW 

to the new owner. An approved transfer 

will not terminate any facility’s existing 

accreditation, which will expire at the 

end of the term set by the transferor AO. 

We are hopeful that requirements 

imposed under these proposed new 

regulations will not affect the contracts 


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between the providers and suppliers 

and the AO. We are also hopeful that 

the accredited providers and suppliers 

will not be required to immediately 

enter into new contracts with the new 

AO since the new owner will assume 

ownership of the AO subject to the AO’s 

existing contractual obligations. 

However, it will be up to the parties 

involved to examine their own 

agreements prior to the CHOW. Unless 

the CHOW agreement between the 

existing AO and transferee AO states 

otherwise, we believe the CHOW will 

not affect the term of accreditation that 

was granted to the providers and 

suppliers by the existing AO ownership, 

provided that CMS does not withdraw 

approval for the accrediting programs to 

be transferred. CMS’ approval for the 

transfer of the approval for the 

accreditation program(s) being 

transferred in a CHOW will be 

contingent upon the new AO owners 

agreement to continue the periods of 

accreditation for any providers or 

suppliers accredited under those 

accreditation programs, prior to the time 

the CHOW transaction took place. In 

other words, the new AO owner will be 

required to assume ownership of the AO 

subject to the terms of existing 

accreditations granted by the existing 

AO. 

The caveat to this rule would be if 

CMS were to not approve the transfer of 

the approval for the accreditation 

program to be transferred in the CHOW. 

In such a case, if the CHOW still 

occurred, the new AO would not have 

approval for the transferred 

accreditation programs and the 

providers and suppliers accredited by 

the previous owner of the AO would be 

required to seek accreditation from 

another AO. Also, there is a possibility 

that a transferor’s poor performance 

could trigger withdrawal of the AO’s 

deeming authority in accordance with 

§ 488.8(g). In this case, as in all cases of 

involuntary termination of an AO’s 

accreditation program, an affected 

provider’s or supplier’s deemed status 

would continue in effect for 180 

calendar days after the removal of the 

approval if the provider or supplier 

submitted an application to another 

CMS—approved accreditation program 

within 60 calendar days from the date 

of publication of the removal notice in 

the Federal Register. 

3. Notification to Parties in the Event 

That CMS Does Not Approve the 

Transfer of the Existing CMS 

Approval—§ 488.5(f)(6) 

Comment: One commenter stated that 

it was important to include this step in 

the provision; however, they stated that 

the language of § 488.5(f)(6) was vague. 

This commenter suggested that 

§ 488.5(f)(6) be revised to include 

language stating that CMS would notify 

all providers and suppliers to the 

CHOW transaction in writing. The 

commenter stated that the notice to the 

providers and suppliers should include 

information about an AO program’s 

current status. 

Response: We appreciate the need for 

providers and suppliers to have 

transparency about their AO’s 

ownership, but believe that the policies 

in this rule are sufficient to reach that 

end. Section 488.5(f)(4) provides that all 

parties to the CHOW transaction must 

notify the providers and suppliers 

affected by such change within 15 

calendar days of being notified of CMS’s 

approval to transfer of the existing CMSapproval for the accreditation programs 

to be transferred in the CHOW 

transaction. We believe that this notice 

to providers and suppliers required by 

§ 488.5(f)(4) is adequate because it must 

be provided within 15 days after CMS 

has approved the transfer of the CMS 

approval for the accreditation programs 

to be transferred in the CHOW. 

Also, § 488.5(f)(5) requires that, after 

CMS receives written confirmation from 

the new owner that the CHOW has 

taken place, CMS publishes a notice of 

approval in the Federal Register of the 

transfer of the existing CMS approval for 

the accreditation program(s) to a new 

owner. However, the notice required by 

§ 488.5(f)(5) will be published only after 

CMS receives written confirmation from 

the new owner that the CHOW has 

taken place because providers and 

suppliers should not be notified by CMS 

of the CHOW until after it is approved 

by CMS. If CMS does not approve the 

transfer of the CMS approval for the 

accreditation programs or if the parties 

to the CHOW decide not to proceed 

with the sale or transfer transaction, 

such premature notice could cause 

providers and suppliers to panic or 

worry unnecessarily. 

We believe between these two forms 

of notice, there is no reason that the 

affected providers and suppliers would 

not be notified of the CHOW. In 

addition AOs contemplating a CHOW 

may choose to notify providers and 

suppliers at any time on their own. 

We further disagree with this 

commenter’s suggestion that the notice 

required by § 488.5(f)(6) should include 

information about the current status of 

the AOs’ programs. The purpose of this 

notice is to inform the parties to the 

CHOW that CMS has disapproved the 

transfer of the approval for the 

accreditation programs to be transferred 

in the CHOW. This is outside the 

purpose of the notice required by 

§ 488.5(f)(6). Also, we believe that it 

would not be CMS’s place to provide 

information about the AO’s current 

status to its accredited providers and 

suppliers; CMS generally does not 

maintain current information on 

accreditation organizations’ client lists. 

B. Documentation Requirements 

Comment: One commenter stated that 

a transition plan plays no role in the 

contemplated business negotiation and 

may not be readily available 90 days 

prior to the effective date of ownership 

transfer. 

Response: We thank the commenter 

for their input but respectfully disagree. 

We believe that the new owner should 

have a transition plan fully developed at 

least 90 days prior to the time that the 

CHOW takes place so that it can be put 

into place immediately upon the sale or 

transfer of the AO. We believe that it 

will be shortsighted of the new owner 

to not develop a transition plan well in 

advance of the anticipated effective date 

of the CHOW. We also believe that it 

will have potentially negative 

consequences, not only for the AO but 

for the providers and/or suppliers it 

accredits, for the new owner to wait 

until after the CHOW takes place to 

develop the transition plan. If this were 

the case, the AO under new ownership 

would lack organization and direction 

until the transition plan was developed 

and implemented. 

Comment: One commenter stated that 

the development of a transition plan 

will engage employees in both the 

business operations and accreditation 

operations departments within the 

AO(s). 

Response: We agree with this 

commenter regarding this aspect of the 

request for approval process and thank 

them for their comment. 

C. Written Acknowledgements 

1. Written Acknowledgement From the 

Purchaser/Buyer/Transferee— 

§ 488.5(f)(3)(ii) 

Comment: One commenter stated that 

the requirement of § 488.5(f)(3)(ii) that 

requires the purchaser/buyer/transferee 

to agree to operate the transferred CMS 

approved accreditation program(s) 

under all of the CMS imposed terms and 

conditions (to include program reviews 

and probationary status terms) is an 

important step. This commenter 

supports the expectation of the 

purchaser or transferee to provide full 

disclosure of the understanding of 

specific conditions related to operating 

a CMS-approved AO. 


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Response: We thank this commenter 

for their support of the written 

acknowledgement provision. 

2. Written Acknowledgement From the 

Purchaser/Buyer/Transferee— 

§ 488.5(f)(3)(iii) 

Comment: This commenter stated that 

the requirement of § 488.5(f)(3)(iii) that 

requires the purchaser/buyer/transferee 

to agree not to operate the accreditation 

program(s) it acquired in the CHOW as 

CMS approved accreditation programs 

until the effective date set forth within 

the notice of approval from CMS 

expands on the importance of full 

disclosure. The commenter supported 

the continued protection of the process 

included in the transfer of ownership of 

an AO. 

Response: We thank this commenter 

for their support of the proposed written 

acknowledgement provision. 

D. Proposed Regulatory Requirements 

1. General Comments About the 

Proposed Regulatory Requirements 

Comments: Several commenters 

expressed full support for our proposal 

to establish the regulations at § 488.5(f). 

One commenter stated that being certain 

a process is in place so that CMS 

approves new ownership of AOs is 

essential to mitigating risks to patients 

and that proposal will establish even 

greater accountability for the AO and 

will highlight CMS’ role in the oversight 

of AOs. This commenter further stated 

that our proposals exemplify the 

ongoing efforts CMS has in order to 

safeguard patients by guaranteeing AOs 

are upholding the standards required to 

maintain an approved accreditation 

program. 

One commenter stated CMS should 

establish a standard process for review 

and approval of a CHOW of an 

accrediting organization and that this 

rule would provide important clarity for 

accrediting organizations seeking to 

undergo an ownership change. Another 

commenter stated that, generally, the 

proposed changes provide for increased 

oversight and strengthen the program 

without placing extraordinary burden 

on AOs and prospective merger or 

acquisition partners. 

Response: We thank these 

commenters for their support of our 

proposals. 

Comment: One commenter did not 

support our proposal to establish 

regulations related to CHOW of AOs. 

This commenter stated that the 

proposed notification requirements 

regarding contemplated ownership 

changes amount to unwarranted 

regulatory interference. 

Response: We thank the commenter 

for sharing their concern but 

respectfully disagree that this regulation 

amounts to unwarranted interference. It 

is important to note that transfer of the 

CMS approval of the accreditation 

programs held by the original owner of 

an accreditation program is not a right 

that could automatically accrue to the 

new owner of an AO. It is also not 

something that could be sold or 

transferred to another owner like a piece 

of property or business asset. Such CMS 

approval is granted to the original 

owner of the AO accreditation programs 

based on the circumstances of the AO 

that exist at the time of approval. 

Therefore, transfer of the CMS 

approval for the accreditation programs 

being transferred in a CHOW must be 

approved by CMS. In order to give this 

approval, CMS must receive assurance 

that the AO under the new ownership 

will be financially viable, and have long 

term stability of operations. CMS must 

also ensure that the accreditation 

provided by the AO, under new 

ownership, meets the CMS standards to 

ensure that the healthcare providers and 

suppliers accredited by that AO are 

providing safe and effective healthcare. 

This means that CMS would need to be 

provided with specific information 

about the proposed new ownership in 

order to obtain such assurance prior to 

the CHOW taking place. 

The regulations at § 488.5(f) allow 

CMS to obtain information prior to the 

CHOW that will allow us to determine 

whether the AO, under the new 

ownership, will maintain continuity of 

operations, will be able to accredit 

facilities using the CMS accreditation 

standards, and whether the facilities 

accredited by the new AO will provide 

safe and effective patient care. CMS is 

finalizing these regulations in order to 

create fair and transparent standards for 

the transfer of the CMS approval for the 

accreditation programs to be transferred 

in a CHOW and avoid any potential 

lapses in deeming authority that may 

come from a post-transfer review. 

Without this regulatory authority, the 

new AO would not be allowed to 

operate using the existing CMS approval 

for the accreditation programs that were 

transferred in the CHOW. The new AO 

owner/transferee will be required to 

submit an application to CMS seeking 

approval of the transferred accreditation 

programs. During the time frame that 

the application was pending CMS 

approval, the new AO owner/transferee 

would not be able to provide 

accreditation services to any providers 

or suppliers. The requirements of 

§ 488.5(f) will enable us to decide 

whether to approve the transfer of the 

existing CMS approval for the 

accreditation programs to be transferred, 

thus avoiding a lapse in the CMS 

approval for these accreditation 

programs. 

Comment: A commenter stated that 

CMS is inappropriately inserting itself 

into the AO’s financial transactions, 

which would interfere with the AOs’ 

ability to conduct business. 

Response: We thank the commenter 

for their concern but respectfully 

disagree. The purpose of this regulation 

is not to approve or deny the sale or 

transfer transaction that takes place. The 

purpose of these regulations is (1) to 

receive documents from the prospective 

new owner of the AO, prior to the time 

that the CHOW takes place, in order for 

CMS to determine whether the AO’s 

accreditation programs under new 

ownership would meet or exceed the 

CMS requirements; (2) to make a 

prospective determination as to whether 

the AO, under the new ownership, can 

assure us that the providers and 

suppliers accredited by the AO, are 

providing safe and effective care; and (3) 

to determine whether to transfer the 

existing CMS approval for an AO’s 

accreditation program to the prospective 

new owner of the AO. We believe these 

functions are integral to CMS’ ability to 

effectively regulate AOs and ensure 

quality in Medicare-certified suppliers 

and providers. Beyond ensuring 

accreditation program integrity and 

adherence to CMS’ requirements under 

the new ownership, we will have no 

part in AO financial business. 

Comment: One commenter stated that 

this proposed notification process could 

create unnecessary work for CMS. They 

explained that not all negotiations end 

in a successful transaction and that in 

the event that a potential ownership 

change never came to fruition, CMS 

would have spent resources reviewing 

documentation for a transaction that 

was never finalized. 

Response: We appreciate this 

commenter’s concern on CMS’ behalf. 

We are primarily concerned with 

making sure there are assurances that an 

AO’s accreditation programs under new 

ownership would meet or exceed our 

requirements and determine whether 

the providers and suppliers accredited 

by that AO provide safe and effective 

care. If a sale or transfer for the AO were 

to fall through, we expect the existing or 

prospective new owner of the AO to 

notify CMS as soon as possible. This 

will allow us to cease our review of the 

documents as early as possible and thus 

limit any unnecessary work. 


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2. Deadline Requirement—§ 488.5(f)(1) 

Comment: One commenter suggested 

that CMS specify in the final regulation 

whether the timeframes are measured in 

business or calendar days. 

Response: We agree with this 

commenter and believe that the 

distinction between calendar and 

business days has a significant impact 

on the amount of time allowed. 

In reviewing § 488.5(f)(1)(iii) in the 

2019 proposed rule, we noted that only 

the 90 day deadline was listed but did 

not specify whether this deadline was 

for calendar or business days. However, 

the remainder of the deadlines 

contained in § 488.5(f) did specify 

whether these deadline are for calendar 

or business days. Therefore, we have 

revised the requirement at 

§ 488.5(f)(1)(iii) by adding ‘‘calendar 

days’’ to the 90 day deadline. 

Comment: One commenter pointed 

out that the proposed regulations do not 

include a timeline related to the CMS 

review and approval or denial of the 

proposed transfer. This commenter 

requested that CMS amend the proposal 

to add that CMS will notify the parties 

of approval or denial no more than 30 

days after receipt of a complete 

application for approval of transfer of 

the existing Medicare approval. 

This commenter stated that a timeline 

should be in place because, should the 

AO contemplate a CHOW arrangement, 

there would be implications on 

planning, forecasting, and budgeting. 

The AO would face significant costs 

throughout the duration of transition 

planning including ongoing accounting, 

public relations, legal, and other 

professional fees. In addition, in a 

CHOW, an AO may have other 

operational issues to consider, including 

staffing requirements and support before 

and after the ownership change. 

Response: We agree with this 

commenter that having a deadline for 

CMS’ review of their request for 

approval of the CHOW would be helpful 

for the planning, forecasting, and 

budgeting process related to a CHOW 

and also for transitioning the AO to the 

new ownership. Therefore we have 

added a provision at § 488.5(f)(1)(iv) 

which requires that CMS will complete 

their review of the AO’s request for 

approval for the transfer of the existing 

CMS approval for the accreditation 

programs to be transferred in the CHOW 

within 90 days from receipt of said 

request. 

3. Federal Register Notice 

Requirement—§ 488.5(f)(5) 

We received no comments in regards 

to this section of the proposed 

regulation, and are therefore adopting it 

without change. 

4. Withdrawal of CMS Approval Due to 

Failure To Notify CMS of Intent To 

Transfer Accreditation Programs— 

§ 488.5(f)(7). 

Comment: One commenter stated that 

the provisions of § 488.5(f)(7) serve an 

important role. This commenter further 

expressed their support for the 

provision at § 488.5(f)(7)(i) regarding 

CMS’ authority to withdraw approval if 

further review of the pending 

transaction reveals issues with 

performance and/or compliance. This 

commenter stated that if an AO does not 

notify CMS of the CHOW, but has 

started the process, the AO may 

continue to operate under their current 

approval but that this violation should 

prompt a CMS review of their current 

approval status. 

Response: We thank this commenter 

for their support regarding the 

requirements in § 488.5(f)(7). We further 

note that there are several types of 

reviews that CMS can use when an AO 

attempts to or does complete a CHOW 

without notice to and approval from 

CMS. 

First, proposed § 488.5(f)(7)(i) will 

allow CMS to perform a review of a 

pending CHOW transaction of which 

CMS has not been made aware. As in 

the case of other CHOW reviews, per 

§ 488.5(f)(7)(ii), if our review revealed 

issues with the AO that were previously 

unknown to CMS, CMS would take 

action accordingly. 

Second, proposed § 488.5(f)(8) 

provides that in the event that the 

parties complete the CHOW, 

notwithstanding CMS disapproval, and 

the purchaser/buyer/transferee attempts 

to operate the transferred accreditation 

program(s) under the CMS-approval 

granted to the previous owner, CMS will 

withdraw the existing approval of the 

transferred accreditation program(s) in 

accordance with the procedures set out 

at § 488.8(c)(3)(ii) and (iii). Existing 

§ 488.8(c) provides the standards for 

CMS-approved accreditation program 

review, including the timeline for the 

AO’s probationary period and 

withdrawal of CMS approval at 

§ 488.8(c)(3)(ii) and (iii). 

Therefore, in addition to the ability to 

cite the AO’s failure to meet Medicare’s 

conditions and requirements under 

§ 488.5(f)(7)(i), CMS can also initiate a 

program review under proposed 

§ 488.5(f)(8). We do not believe that any 

additional review processes are 

necessary. 

5. Withdrawal of CMS Approval for 

Accreditation Programs Which Are 

Transferred Notwithstanding CMS’ 

Disapproval of the Transfer— 

§ 488.5(f)(8) 

Comment: One commenter supported 

the provision for the withdrawal of 

CMS’ approval for the accreditation 

program if the transfer is disapproved, 

as proposed at § 488.5(f)(8). 

Response: We thank this commenter 

for their support of the proposed 

withdrawal provision. 

Comment: One commenter suggested 

that the notice of withdrawal of an AO’s 

Medicare approval should be provided 

directly to affected providers by CMS 

and the AO. This commenter stated that 

this would make this notice process 

consistent with the notice requirement 

when a CHOW is approved. 

Response: We understand this 

commenter’s concern. We would like to 

point out that if CMS does not approve 

a CHOW, we will not withdraw or 

terminate an AO’s Medicare 

participation, but instead will withdraw 

the CMS approval for that AO’s 

accreditation programs to be transferred 

in the CHOW. If the transferee were to 

proceed with the CHOW, the AO, under 

new ownership, will be permitted to file 

a new application seeking CMS 

approval for these accreditation 

programs. 

We do not believe that it is necessary 

to modify the regulations at § 488.5(f) to 

require CMS to provide notice of the 

disapproval of the CHOW directly to the 

affected providers and suppliers for 

several reasons. First, if the transferee 

elected not to proceed with the CHOW, 

then the CMS approval would remain 

unchanged as per § 488.5(f)(7)(i) 

Second, there are other AO oversight 

regulations which require that such 

notice be given to providers and 

suppliers when CMS withdraws 

approval for an AO’s accreditation 

program. Existing § 488.8(g)(1) provides 

that we will publish a notice in the 

Federal Register if we were to withdraw 

the CMS approval of an AO. Also, 

existing § 488.8(e) provides that an AO 

whose CMS approval has been 

withdrawn must notify, in writing, each 

of its accredited providers or suppliers 

of the withdrawal and the implications 

for the providers’ or suppliers’ deemed 

status no later than 30 calendar days 

after the notice is published in the 

Federal Register. We believe that the 

notice provided pursuant to 

§§ 488.8(e)(1) and 488.8(g) are adequate 

to ensure providers and suppliers 

receive timely notification of the 

withdrawal of an AO’s CMS approval. 


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We are therefore finalizing § 488.5(f)(8) 

without change. 

6. Requirements for Continuation of a 

Deemed Status Accreditation of 

Medicare-Certified Providers and 

Suppliers After CMS Withdraws the 

Existing Approval of the Transferred 

Accreditation Program(s)—§ 488.5(f)(9) 

Comment: One commenter stated that 

if CMS proceeds in codifying this 

process, it should extend the proposed 

timeframes for providers, to allow 

sufficient time for providers to negotiate 

new contracts and have orderly 

transitions from one AO to another AO, 

or to a SA. 

Response: We appreciate this 

commenter’s concern. The timeframes 

set forth in § 488.5(f)(9) are the same as 

those that are set forth in § 488.8(g) 

entitled ‘‘Continuation of deemed 

status’’ which provides that ‘‘[a]fter 

CMS removes approval of an accrediting 

organization’s accreditation program, an 

affected provider’s or supplier’s deemed 

status continues in effect for 180 

calendar days after the removal of the 

approval if the provider or supplier 

submits an application to another CMSapproved accreditation program within 

60 calendar days from the date of 

publication of the removal notice in the 

Federal Register.’’ We believe that 

having different timeframes in 

§ 488.5(f)(9) for the same activities that 

are set forth in § 488.8(g) for Medicarecertified providers and suppliers would 

be inconsistent and confusing to 

providers and suppliers. 

Comment: One commenter noted that 

the proposed rule provided that if an 

AO did not appropriately seek approval 

from CMS prior to a change in 

ownership, providers accredited by the 

now-former AO would only have 180 

days of deemed status remaining. As an 

example, a hospital may have only 

recently gone through their AO’s survey 

process and could have just recently 

been reaccredited for 3 years. Through 

no fault of their own, they would have 

only 6 months prior to their loss of 

Medicare certification status. By 

contrast, the proposed rule would 

provide 1 year of accreditation status to 

non-certified suppliers. This commenter 

recommended that CMS grant Medicarecertified providers and suppliers at least 

the same amount of time as noncertified suppliers (that is, 1 year) and 

allow for an extension process if 

additional time is needed. This 

commenter further stated that the 

Ligature Risk Extension Request process 

in CMS’ draft guidance, DRAFT–QSO– 

19–12-Hospitals—Clarification of 

Ligature Risk Interpretive Guidelines, 

released April 19, 2019, may provide a 

helpful model for seeking an extension. 

Response: We appreciate this 

commenter’s concern. The timeframe set 

forth in § 488.5(f)(9) for Medicarecertified providers and suppliers are the 

same as those that are set forth in 

§ 488.8(g) titled ‘‘Continuation of 

deemed status.’’ In fact, § 488.8(g) are 

referenced in § 488.5(f)(9)(iii). As noted 

previously, we believe using different 

timeframes would be inconsistent and 

confusing. 

We proposed at § 488.5(f)(10) that if 

CMS withdrew AO approval of 

transferred non-certified accreditation 

program(s) because a CHOW was 

completed without notice to CMS or 

receipt of CMS approval, an affected 

non-certified supplier’s deemed status 

would continue in effect for 1 year after 

the removal of the existing CMS 

accreditation approval if the noncertified supplier submitted an 

application to another CMS approved 

accreditation program within 60 

calendar days from the date of 

publication of the removal notice in the 

Federal Register and provided written 

notice of such application to the CMS 

within such timeframe. Failure to 

comply with the timeframe 

requirements would result in a CMS 

determination that the supplier was no 

longer accredited. 

We proposed a 1 year period of time 

for the continuation of accreditation for 

non-certified suppliers for several 

reasons. First, the provisions of 

§ 488.8(g) do not apply to non-certified 

suppliers. Second, in our view, giving 

non-certified suppliers additional time 

compared to Medicare-certified provider 

and suppliers (1 year as opposed to 180 

days of continued accreditation status, 

respectively), is appropriate due to the 

different circumstances of Medicare and 

Medicare certified providers and 

suppliers as compared to those of the 

non-certified suppliers. More 

specifically, non-certified suppliers are 

not subject to inspection by the SA, 

because there is no legal authority for 

the SA to do so. Therefore, they are not 

able to use the SA for approval to 

participate in Medicare in the event that 

they cannot obtain accreditation from an 

AO. We believe it is necessary to grant 

the non-certified suppliers a longer 

period of extended accreditation in 

which to achieve reaccreditation from 

another AO, since they do not have the 

safety net of being certified by the state. 

For non-certified suppliers such as 

ADI, DSMT, and HIT suppliers, the 

accreditation process typically takes 

longer because it’s usually performed by 

a ‘‘desk audit’’ process. With a desk 

audit, the non-certified supplier would 

be given a period of time in which to 

collect and submit the information 

required for the desk audit. For 

example, ADI suppliers must submit 

images for specific ADI procedures. 

They must either gather images from 

procedures that have already been 

performed or perform new procedures 

to obtain these images. 

After the ADI supplier has obtained 

all of the images required for 

accreditation, they would submit their 

accreditation package to the AO. We 

estimate that the ADI AO’s review the 

ADI supplier’s accreditation package 

takes up to one to several weeks, 

depending on the AO’s workload. 

Whereas, for Medicare-certified 

providers and suppliers, accreditation is 

based on an on-site survey, which can 

be scheduled and performed within a 

short period of time. Therefore, the 

accreditation can be completed more 

quickly. 

In addition, accreditation is a 

condition for receipt of Medicare 

payment for non-certified suppliers, 

while this is not the case for Medicare 

certified providers and suppliers. If 

their Medicare accreditation lapses, the 

non-certified suppliers would no longer 

be eligible to receive payment for 

services furnished to Medicare 

beneficiaries. This could lead to 

financial hardship for these noncertified suppliers that could cause 

them to refuse to serve Medicare 

beneficiaries or cause them to go out of 

business. Both of these scenarios would 

result in an access to care issues for 

Medicare beneficiaries. For these 

reasons, we believe it is important that 

we allow the non-certified suppliers a 

longer period of time in order to obtain 

re-accreditation from another AO. 

Comment: One commenter suggested 

that both the 60-day timeframe to 

submit an application to a new AO and 

the 120-day timeframe to be surveyed be 

extended. Another commenter 

expressed the belief that an affected 

provider’s or supplier’s deemed status 

should continue for longer than 180 

days to allow sufficient time for them to 

make decisions, establish budgets, 

prepare for and address findings on the 

path to an accreditation determination 

by a new AO. 

Response: This commenter seems to 

suggests that §§ 488.5(f)(9) and 488.8(g) 

provide for 2 separate and distinct 

periods of time or deadlines, consisting 

of an initial 60 day period in which the 

provider or supplier must submit their 

application to another AO and second 

and subsequent 120 day period in 

which the provider or supplier must be 

surveyed. 


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We note that providers and suppliers 

actually have 180, rather than 120, days 

in which to receive accreditation. 

Section 488.5(f)(9) provides that ‘‘an 

affected Medicare-certified provider or 

supplier’s deemed status will continue 

in effect for 180 calendar days if the 

Medicare-Certified provider or supplier 

takes the following steps set forth is 

§ 488.8(g).’’ Those steps include the 

provider or supplier is required to file 

an application with another AO and 

provide notice to the SA of the filing of 

this application within 60 days of the 

date of receipt of notice of the 

withdrawal of the AOs CMS approval. 

This deadline does not separate the 180 

day period of continued accreditation 

into two separate and distinct periods. 

Rather, healthcare provider or supplier 

can file their application with another 

AO as soon possible after being notified 

of withdrawal of their AO’s CMS 

approval. Conceivably, this application 

could be filed the day after the provider 

or supplier received such notification. 

We believe that if a provider or supplier 

has filed an AO application in the past, 

they should be familiar with the 

information and documentation 

required and therefore, should not wait 

until near the 60 day deadline to notify 

the SA of the filing of their application 

with another AO. 

We further believe that the 180-day 

timeframe is an adequate amount of 

time for a Medicare-certified provider or 

supplier to obtain reaccreditation from a 

new AO. In fact, the timeframes in 

§ 488.8(g) are referenced in 

§ 488.5(f)(9)(iii). 

E. Change of Ownership of AOs 

Comment: One commenter suggested 

that, CMS should also require written 

disclosure of any potential or actual 

conflicts of interests related to the new 

owner, as part of the documentation 

required to request approval of a 

transfer to a new owner. This 

commenter expressed the opinion that 

requiring this information would do the 

following: (1) Give CMS the authority to 

review conflicts and, if necessary, 

require corrective action as a condition 

of approval; (2) be an opportunity to 

consider conflicts based on paid 

consultative services (the subject of the 

Request for Information published in 

December 20, 2018, ‘‘Accrediting 

Organizations Conflict of Interest and 

Consulting Services’’, CMS–3367–NC 

(83 FR 65331)); and (3) help CMS ensure 

that the primary focus of accreditation 

by the new owner is to recognize quality 

and that accreditation decisions will 

continue to be made in an objective 

manner independent of the new owner’s 

other financial or programmatic 

interests. 

Response: We agree with this 

commenter. Therefore, we have added a 

requirement at § 488.5(f)(2)(iii)(D) that 

requires the prospective new owner of 

the AO to provide policies and 

procedures to avoid conflicts of interest, 

including the appearance of conflicts of 

interest, involving individuals who 

conduct surveys or participate in 

accreditation decisions, as required by 

§ 488.5(f)(10) with the information to be 

submitted with the AO’s request for 

approval. 

Comment: Several commenters 

expressed concern regarding the 

confidentiality of proprietary merger/ 

acquisition information and the openended review timeline. Other 

commenters expressed concerned that 

the proposed regulation did not include 

provisions protecting against disclosure 

of sensitive information related to the 

potential CHOW. 

Another commenter explained that 

parties to a merger or acquisition have 

significant interest in maintaining the 

confidentiality of related deliberations 

because uncontrolled disclosure could 

cause significant harm to the interests of 

the parties involved and other 

stakeholders, including CMS. This 

commenter expressed concern that if the 

CHOW information is disclosed 

prematurely, it could create concern 

amongst customers, potentially 

impacting the transaction, and creating 

operational issues for both the 

accreditation organization and CMS 

who may not yet be ready to field 

customer inquiries about the pending 

change. 

Another commenter expressed 

concern that the proposed rule contains 

no explicit guarantee of the 

confidentiality of proprietary 

information and intellectual property 

shared with CMS. This commenter 

stated that as part of the valuation 

process in any ownership change, AOs 

will share proprietary information and 

intellectual property that must remain 

protected. Another commenter 

recommended that CMS consider 

confidentiality concerns of the involved 

parties in any rulemaking that requires 

advance notice to CMS. Several other 

commenters requested that CMS modify 

the proposal with consideration for 

these concerns. 

Response: We understand the concern 

expressed by these commenters. We will 

make every effort to keep the 

information submitted by the buyer/ 

transferee in support of their request for 

transfer of the existing CMS approval for 

the accreditation programs strictly 

confidential. There is a possibility that 

CMS could receive a Freedom of 

Information Act (FOIA) request for this 

information, however the FOIA contains 

several statutory exemptions that allow 

agencies to withhold records in 

responding to a FOIA request. 

Exemption 4 protects ‘‘trade secrets and 

commercial or financial information’’ 

that is ‘‘privileged or confidential.’’ See 

5 U.S.C. 552(b)(4). CMS will withhold 

or release information in accordance 

with applicable federal law and its 

regulations at 45 CFR subpart D. 

Comment: One commenter stated that 

CMS should consider ‘‘change of 

control’’ principles in addition to 

‘‘CHOW’’ as part of the proposed rule. 

Response: We thank the commenter 

for their input. We note that the term 

‘‘change of control’’ could refer to a 

change in the day-to-day AO 

management activities, or a change to 

the managing control of the AO. This 

term could also refer to a change in the 

ownership or partnership interests in 

the AO. A change of management or 

managing control could involve a 

change in the day-to day management 

staff, board of director members or 

managing partners of the AO. A change 

in the ownership interest in the AO 

could involve a change in the number 

of persons who own an interest in the 

AO and/or a change in their percentage 

of ownership of interest in the AO. A 

change in a partnership interest in an 

AO could involve the addition of or 

removal of partners or a change in the 

percentage of their partnership interest. 

We do not believe that change of 

control should be included in the 

regulations at § 488.5(f) because, if a 

change of control issue were to occur, 

we would not expect the daily 

operations of the AO to change. We say 

this because, an AO undergoes a change 

of control they are required to notify 

CMS of this change. Also if, as a result 

of the change of control, the AO were 

to decide to make changes to its 

accreditation standards and/or survey 

processes, the AO will be required to 

submit these revised accreditation 

standards and/or survey processes to 

CMS for a comparability review and 

CMS approval pursuant to § 488.8((b)(2). 

In addition, the AO will be required by 

§ 488.5(a)(19) to provide, with their 

initial or renewal application, a 

statement that, in response to a written 

notice from CMS to the organization of 

a change in the applicable conditions or 

requirements or in the survey process, 

the organization will provide CMS with 

proposed corresponding changes in the 

organization’s requirements for its CMS 

approved accreditation program to 

ensure continued comparability with 

the CMS conditions or requirements or 


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1https://www.bls.gov/oes/current/oes291141.htm. 2https://www.bls.gov/oes/current/oes119111.htm. 3https://www.bls.gov/oes/current/oes132011.htm. 

survey process. These proposed changes 

must be submitted within 30 days after 

CMS’s written notice and the AO may 

not implement them without CMS 

approval. We believe that these 

requirements will be sufficient to 

provide notice to CMS of any changes, 

in the event that an AO undergoes a 

change of control. 

Comment: One commenter suggested 

that the regulation should set out the 

criteria CMS uses to assess an AO’s 

ability to perform its tasks after a CHOW 

has occurred. 

Response: We appreciate this 

commenter’s concern but respectfully 

disagree. The regulation at § 488.5(f)(2) 

states the specific information the AO 

must submit to CMS for review. As we 

have noted throughout this preamble, 

we review transaction information in 

order to assess the new AO’s financial 

resources and its ability to perform its 

tasks after a CHOW has occurred, in 

order to insure the ongoing effectiveness 

of the approved accreditation 

program(s) and to minimize risks to 

patient safety. We believe that stating 

the information and documents that will 

be reviewed and the purpose for this 

review provides the AOs with enough 

information about CMS’ intent for the 

review and approval or disapproval of 

the transfer of the existing CMSapproval for the accreditation programs 

to be transferred in the CHOW. The 

review of the application to be 

submitted by the prospective new 

owner of the AO is similar to the 

requirements at § 488.5 in which we 

request information to be submitted 

with an AO’s initial or renewal 

application for CMS approval of the 

AOs accreditation programs. We do not 

state specific review criteria to be used 

for this application review. 

IV. Provisions of the Final Regulations 

In this final rule, we are adopting the 

provisions in the May 2, 2019 proposed 

rule, with the following changes: 

• Revised § 488.5(f)(1)(iii) to specify 

that the 90 day deadline refers to 

calendar days. 

• Revised § 488.5(f)(1)(iv) to specify 

that we will complete our review of the 

AO’s request for approval for the 

transfer of the existing approval for the 

accreditation programs to be transferred 

CHOW within 90 days from receipt of 

the request. 

• Revised § 488.5(f)(2)(iii)(D) to 

require that the prospective new owner 

of an AO provide us with policies and 

procedures to avoid conflicts of interest, 

including the appearance of conflicts of 

interest, involving individuals who 

conduct surveys or participate in 

accreditation decisions, as required by 

§ 488.5(f)(10). 

V. Collection of Information 

Requirements 

Under the Paperwork Reduction Act 

of 1995, we are required to provide 30- 

day notice in the Federal Register and 

solicit public comment before a 

collection of information requirement is 

submitted to the Office of Management 

and Budget (OMB) for review and 

approval. In order to fairly evaluate 

whether an information collection 

should be approved by OMB, section 

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

Reduction Act of 1995 requires that we 

solicit comment on the following issues: 

• The need for the information 

collection and its usefulness in carrying 

out the proper functions of our agency. 

• The accuracy of our estimate of the 

information collection burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including the use of 

automated collection techniques. 

We solicited public comment on each 

of the section 3506(c)(2)(A)-required 

issues for the following information 

collection requirements (ICRs). 

A. Wage Data 

In the 2019 proposed rule, to derive 

average costs, we used data from the 

U.S. Bureau of Labor Statistics’ (BLS) 

May 2020 ‘‘National Occupational 

Employment and Wage Estimates’’ for 

all salary estimates (http://www.bls.gov/ 

oes/current/oes_nat.htm). In this final 

rule we have updated the wage 

information to reflect the most current 

wage information from the BLS for the 

May 2020 ‘‘National Occupational 

Employment and Wage Estimates’’ 

(https://www.bls.gov/oes/current/oes_

nat.htm). 

In this regard, the following table 

presents the updated mean hourly wage, 

the employer’s benefits and other 

indirect costs (calculated at 100 percent 

of salary), and the adjusted hourly wage. 

TABLE—NATIONAL OCCUPATIONAL EMPLOYMENT AND WAGE ESTIMATES

BLS occupation title Occupation 

code 

Mean hourly 

wage 

Hourly wage 

adjusted for 

benefits 

& other 

indirect costs 

Registered Nurse 1 ....................................................................................................................... 29–1141 $38.47 $76.94 

Medical or Health Services Manager 2 ........................................................................................ 11–9111 57.12 114.24 

Accountant or Auditor 3 ................................................................................................................ 13–2011 39.26 78.52 

As indicated, we are adjusting our 

employee hourly wage estimates by a 

factor of 100 percent. This is necessarily 

a rough adjustment, both because the 

employer’s benefits and other indirect 

costs vary significantly from employer 

to employer, and because methods of 

estimating these costs vary widely from 

study to study. Nonetheless, there is no 

practical alternative and we believe that 

doubling the hourly wage to estimate 

total cost is a reasonably accurate 

estimation method. 

B. Documentation Requirements 

At § 488.5(f)(1), we require that the 

AO that is the subject of the transaction 

provide notice to CMS that it intends to 

request approval for a CHOW. This 

initial notice will be minimal, such as 

a coversheet, email, or any type of 

formal notice and will be included in 

the additional documentation 

requirements of § 488.5(f)(2). 

At § 488.5(f)(2)(i) and (ii), we specify 

that the prospective purchaser or 

transferee provide three most recent 

audited financial statements of the 

organization that demonstrate that the 

organization’s staffing, funding, and 

other resources are adequate to perform 

the required surveys and related 

activities. Additionally, we require the 

name and address of the legal entity that 

would be the owner of the new AO. We 

believe that this information is 


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documentation that will be easily 

accessible and require minimal time to 

gather and submit. Therefore, we have 

considered that the cost burden for the 

AO to submit the financial statements 

and other information deemed 

necessary by CMS will be 

approximately $76.94. We believe it is 

likely that the AOs use a registered 

nurse (RN) to gather information and we 

estimate the time to gather the financial 

statements will not exceed 1 hour. The 

AO will incur a cost burden in the 

amount of $76.94 for the preparation of 

the response to CMS (1 hour × $76.94). 

At § 488.5(f)(2)(iii), we require the 

prospective purchaser or transferee to 

submit a transition plan that 

summarizes the details of how the 

accreditation functions will be 

transitioned to the new owner. While 

most existing AOs engaged in business 

transactions such as a CHOW would 

have already developed a transition 

plan as proposed under section II of the 

2019 proposed rule, this process will be 

more time consuming. The development 

of a transition plan will take 

approximately 45 hours of time to 

gather, obtain, or prepare all 

documentation for submission. We 

estimate that the AO will have a total of 

three staff work on transition plan. One 

of these staff persons will likely be 

clinicians such as a RN. We further 

believe that the other will be in a 

management position and serve in a 

management position. We believe that 

this person’s position will be equivalent 

to the U.S. Bureau of Labor Statistics job 

category of Medical and Health Services 

Manager. We believe that the other staff 

person working on this task will be 

accountant or auditor. 

We estimate that the RN, medical or 

health services manager, and accountant 

or auditor would each spend 45 hours 

performing this task. We estimate that 

the total time burden for this task will 

be 135 hours. 

We further estimate that the cost 

burden for the work performed by the 

RN will be $3,462.30 (45 hours × 

$76.94). We believe that the cost burden 

for the work performed by the Medical 

and Health Services Manager will be 

$5,140.80 (45 hours × $114.24 per hour). 

Also, we estimate that the cost burden 

for the work performed by the auditor 

or account will be $3,533.40 (45 hours 

× $78.52 per hour). 

Finally, we estimate that the total cost 

burden for this task will be $12,136.50 

($3,462.30 + $5,140.80 + $3,533.40). 

Section 488.5(f)(2)(iii)(C)(6) requires 

the prospective new owner of the AO to 

submit any other relevant information 

that CMS finds necessary. This task 

would involve the following: (1) Review 

of CMS’ request for information 

regarding the CHOW; (2) collecting and 

preparing this information for sending 

to CMS; and (3) sending the requested 

information to CMS. In the 2019 

proposed rule we had estimate the time 

burden for this task to be 1 hour. 

However, in response to a public 

comment received. We are increasing 

the time burden for this task to 3 hours. 

We believe that this task will be 

performed be a clinician such as RN, as 

is generally the case in AO applications 

seeking deeming authority. We estimate 

that the total cost burden incurred by 

the AO for this task will be $230.82 (3 

hours × $76.94). 

C. Written Acknowledgements 

At § 488.5(f)(3), we specify that the 

purchasing AO to provide several 

written acknowledgements. At 

§ 488.5(f)(3)(i), we require the purchaser 

or transferee to provide written 

acknowledgement that it understands 

the financial and legal responsibilities 

involved with the CHOW process. We 

believe this written acknowledgement 

will be developed by a health services 

manager, as they currently serve in roles 

for submission of general accrediting 

approvals. We believe this will not take 

more than 1 hour to prepare the 

required written notice. 

We estimate that the total cost burden 

associated with this task will be 

$114.24. ($114.24 × 1 hour). 

At § 488.5(f)(3)(ii), we require the 

purchasing AO to provide written 

acknowledgement that it agrees to 

operate the new AO as defined by CMS’ 

standards under §§ 488.5 and 488.9, as 

well as include acknowledgements on 

any program reviews or probationary 

terms. This will be a minimal cost 

burden as we are not defining a specific 

format for the written 

acknowledgement. We believe that it 

will take no more than 1 hour to prepare 

this written notice. We believe that this 

task will be performed by a medical or 

health services manager. We estimate 

that the cost burden associated with this 

task will be $114.24 (1 hour × $114.24). 

At § 488.5(f)(3)(iii), we require the 

purchasing AO to provide written 

acknowledgement that would not 

operate the accreditation program until 

it received a notice of approval of the 

transfer of the CMS approved 

accreditation program from CMS. Given 

this requirement is minimal and the 

purchasing AO is already required to 

include a written acknowledgment as 

outlined at proposed § 488.5(f)(3)(ii), it 

is likely that this written notice will 

include both acknowledgements; 

therefore, we will include this in the 

hour of burden and cost described 

under § 488.5(f)(3)(ii). 

At § 488.5(f)(5), we require the 

purchasing AO to provide 

documentation within 15 days after the 

sale confirming the CHOW. We believe 

that it is a standard business practice 

that the sale or transfer of a business 

and its assets be confirmed with some 

type of documentation such as a bill of 

sale, deed, or financial documents. 

Therefore, we believe that the burden to 

the AO for providing the required proof 

of the sale of transfer of the AO will be 

minimal. This will require the AO to 

provide CMS with a copy of already 

existing sales documentation. Also, 

because the existing owner of the AO 

and prospective new owner will be in 

the process of negotiating the sale or 

transfer of the AO, we believe that the 

AO will have this information readily 

available and easily accessible. 

We estimate that it will require 30 

minutes for the staff of the new AO to 

provide a copy of the existing sales 

documentation to CMS via an electronic 

method such as email. We believe that 

this task will be performed by a medical 

or health services manager. We estimate 

that the total cost burden for this 

requirement will be $57.12 (0.5 hour × 

$114.24). 

We want to emphasize that these 

anticipated costs and burdens are only 

subject to those AOs seeking a CHOW. 

To date, there has been one CHOW 

request of an AO submitted 

approximately 20 years and another 

submitted in November 2020. While we 

cannot predict the frequency with 

which AO CHOW transactions will 

occur in the future, we believe that they 

should occur more frequently than they 

have in the past. 

The requirements and burden will be 

submitted to OMB under (OMB control 

number 0938–New). 

D. Description of Time and Cost 

Burdens 


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4The time and cost burden related to § 488.4(f)(1) 

are minimal have been combined with the time and 

cost burden for § 488.5(f)(2) because the notification 

required by § 488.5(f)(1) would be submitted 

together with the documentation required by 

§ 488.5(f)(2). 

Description of burden 

Time per 

response 

(hours) 

Number of 

potential 

respondents 

per every 

3 years 

Triennial hour 

burden per 

response 

(hours) 

Cost per 

response 

Triennial 

cost burden 

Burden Associated with proposed § 488.5(f)(1) 4 (See footnote 4 below) .................................................................... 0 1 0 $0 $0 

Burden Associated with proposed § 488.5(f)(2)(iii) .............. 135 1 135 12,136.50 12,136.50 

Burden Associated with proposed § 488.5(f)(2)(iii)(C)(6) .... 3 1 3 230.82 230.82 

Burden Associated with proposed § 488.5(f)(3)(i) ............... 1 1 1 114.24 114.24 

Burden Associated with proposed § 488.5(f)(3)(ii) & 

488.5(f)(3)(iii) .................................................................... 1 1 1 114.24 114.24 

Burden Associated with proposed § 488.5(f)(5) .................. 0.5 1 0.5 57.12 57.12 

Total .............................................................................. 140.5 1 140.5 12,652.92 12,652.92 

E. Response to Public Comments 

We received the following public 

comments in response to the burden 

estimates: 

Comment: One commenter stated that 

the development of a transition plan 

will engage employees in both the 

business operations and accreditation 

operations departments within the 

AO(s). This commenter suggested that 

the estimated time and cost burden of 

$8,014 to allow for the work performed 

by business operations. 

Response: We agree with this 

commenter that there could be a 

business person such as an accountant 

or auditor involved in the preparation of 

the transition plan. Therefore, we have 

revised the burden estimate for this task 

to include a time burden of 45 hours for 

an additional person who would be an 

accountant or auditor. This change 

increased the hourly burden estimate for 

the preparation of the transition plan 

from 90 to 135 hours. 

Comment: One commenter suggested 

that the estimated time burden of 1 hour 

for a development of a response to a 

CMS request for additional information 

be increased to 8 hours. The commenter 

stated that while one individual will 

prepare the response, it will require 

multiple layers of internal review, 

approval, and communication as well as 

delivery to CMS. 

Response: We appreciate this 

commenter’s input. We agree that there 

will be layers of administrative review 

for any documentation requirements. 

However, we do not believe that this 

administrative review should be 

included in the burden estimate, 

because this is a task that is performed 

in the normal course of business and 

therefore will not be considered burden. 

Given the unpredictable nature of the 

‘‘CMS request for additional 

information’’ we believe that the current 

burden estimate of 1 hour to perform 

this task is too low. 

If the AO provides all of the 

information required by § 488.5(f)(2)(iii), 

CMS would need to request little, if any, 

additional information. However, if the 

AO fails to provide some of the 

information required by § 488.5(f)(2)(iii), 

we believe that the time spent by the 

AO to provide this information in 

response to a request from CMS for 

additional information will still be 

covered under our initial burden 

estimate for § 488.5(f)(2)(iii). Therefore, 

we do not agree with this commenter 

that the time required for the 

prospective owner to submit ‘‘additional 

documentation’’ should be increased to 

8 hours. This request for additional 

information and/or documentation 

would occur only after CMS has 

received and reviewed the required 

documentation from the prospective 

new owner and found that there was 

missing or incomplete information or 

that we needed additional clarifying 

information. 

We have increased the estimated time 

burden for this task to 3 hours. 

However, we note that this requirement 

would not be a regularly occurring 

burden under these regulations but 

would only be required when and if 

CMS needs additional information from 

the AO. 

Comment: One commenter stated that 

the hours assigned for the preparation of 

the CHOW application was estimated to 

be two staff (one RN and one health 

services manager) for 2 hours each for 

a total of 4 hours. This commenter 

suggested that the amount of staff 

working in this task should be increased 

to three (two RNs and one health 

services manager), and the time spent 

on this task should be increased to 8 

hours per each person for each a total 

of 24 hours. 

Response: We thank the commenter 

for their concern. However, we did not 

provide a specific burden estimate for 

the task of preparing an application 

which will be performed by two RNs for 

a period of 2 hours each. We did 

provide specific time and cost burden 

estimates for the gathering and 

submission of required documentation 

set forth in § 488.5(f)(1) and 

§ 488.5(f)(2)(iii). We have revised this 

burden estimate in response to public 

comments received. We believe that this 

burden estimates, as revised, provide an 

accurate estimate of the burden related 

to the requirements of § 488.5(f)(2). 

VI. Regulatory Impact Statement 

A. Overall Impact 

We have examined the impact of this 

rule as required by Executive Order 

12866 on Regulatory Planning and 

Review (September 30, 1993), Executive 

Order 13563 on Improving Regulation 

and Regulatory Review (January 18, 

2011), the Regulatory Flexibility Act 

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

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

202 of the Unfunded Mandates Reform 

Act of 1995 (March 22, 1995; Pub. L. 

104–4), Executive Order 13132 on 

Federalism (August 4, 1999), and the 

Congressional Review Act (5 U.S.C. 

804(2)). 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). A Regulatory Impact Analysis 

(RIA) must be prepared for major rules 

with economically significant effects 

($100 million or more in any 1 year). 

This rule does not reach the economic 

threshold and thus is not considered a 

major rule. 


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25426 Federal Register / Vol. 87, No. 83 / Friday, April 29, 2022 / Rules and Regulations 

B. Burden for Change of Ownership 

Among Accrediting Organizations 

The AOs which seek to sell or transfer 

or purchase another AO and undergo a 

CHOW will incur time and cost burdens 

associated with the preparation of the 

information they submit to CMS to 

request approval of their new 

accreditation program under the CHOW. 

This includes the preparation, gathering 

or obtaining of all the documentation 

required at § 488.5(f). 

While we recognize that most existing 

AOs are familiar and have majority of 

the documentation CMS is requesting at 

§ 488.5(f), we believe that due to the 

need for the selling or transferring and 

purchasing AOs to submit 

documentation for both entities, that 

this will take approximately 2 hours of 

time to gather, obtain or prepare all 

documentation required by § 488.5(f). 

We believe that this task will take 

approximately 2 hours because the AOs 

have previously submitted an 

application to CMS requesting approval 

of their accreditation program; therefore, 

will already be familiar with the 

application process and requirements 

and should have the required 

documentation readily available. 

The AOs (selling or transferring and 

purchasing) will incur costs associated 

with the preparation and submission of 

the requested documents, development 

of the written acknowledgement letters, 

and submission of the documents. The 

AO will incur costs for the wages of all 

AO staff that work on the preparation of 

the CHOW application. We estimate that 

the AO will have a total of three staff 

work on the preparation of the 

application. We believe that two of the 

AO staff that perform this task will be 

clinicians such as RN or medical or 

health services manager, as they 

currently serve in roles for submission 

of general accrediting approvals. We 

further believe that the third AO staff 

person will be an accountant or auditor. 

We estimate that the RN, medical or 

health services manager, and accountant 

or auditor will each spend 45 hours 

performing this task. The total estimated 

time burden for this task is 135 hours. 

The mean hourly wage for a RN is 

$38.47 (https://www.bls.gov/oes/ 

current/oes291141.htm). This wage, 

adjusted for the employer’s benefits and 

other indirect costs, is $76.94. We 

estimate that the total wages incurred by 

the AO for the 45 hours spent by the RN 

performing this task will be $3,462.30 

($76.94 × 45 hours). 

The mean hourly wage for a medical 

or health services manager is $57.12 

(https://www.bls.gov/oes/current/ 

oes119111.htm). This wage adjusted for 

the employer’s benefits and other 

indirect costs is $114.24. We estimate 

that the total wages incurred by the AO 

for the 45 hours spent by the Medical or 

Health Services Manager performing 

this task will be $5,140.80 ($114.24 × 45 

hours). 

The mean hourly wage for an 

accountant or auditor is $37.89. (https:// 

www.bls.gov/oes/current/ 

oes132011.htm). This wage adjusted to 

include employer’s benefits and other 

indirect costs is $78.52. We estimate 

that the total wages incurred by the AO 

for the 45 hours spent by the 

Accountant performing this task will be 

$3,533.40 ($78.52 × 45). 

We estimate that the total cost burden 

for this task will be $11,598, which is 

calculated as follows: 

• 45 hours × $76.94 per hour = 

$3,462.30 

• 45 hours × $114.24 per hour = 

$5,140.80 

• 45 hours × $78.52 per hour = 

$3,533.40 

Total = $12,136.50 

Furthermore, at § 488.5(e)(8), we 

require the AOs to provide additional 

information as requested by CMS to 

ensure the continuity of oversight for 

facilities currently accredited. 

Therefore, there is potential for AOs to 

incur a cost burden for the wages of the 

AO staff that are involved with 

reviewing our additional requests for 

information and the preparation of the 

documents and program standards. The 

AO staff that review information 

requested by CMS regarding the CHOW 

will be a clinician such as RN, as is 

generally the case with the AO’s 

preparation and submission of 

application materials. We estimate that 

it will take 3 hours for the RN to 

perform this task. 

As, stated previously, the adjusted 

wage for an RN is $76.94. We estimate 

that the AO will incur a cost burden in 

the amount of $230.82 (3 hours × $76.94 

per hour) for the preparation of the 

response to CMS. 

We want to emphasize that these 

anticipated costs and burdens are only 

subject to those AOs seeking a CHOW. 

To date, there has only been one AO 

CHOW request submitted approximately 

20 years ago and another submitted in 

November 2020. While we cannot 

predict the frequency with which AO 

CHOW transactions will occur in the 

future, we believe that they should 

occur more frequently than they have in 

the past. 

We solicited comments, specifically 

from stakeholders and AOs and request 

AOs to submit their comments to 

include a breakdown of potential costs 

they would estimate for this to be 

completed. 

A summary of the comment received 

and our response to that comment 

follow: 

Comment: One commenter stated that 

they disagree with the conclusion that 

the burden would not be substantial for 

the AO and any other parties involved 

in a proposed CHOW because the cost 

estimates provided based on hours are 

probably low. 

Response: We have revised our time 

and cost burden estimates in section V 

‘‘Collection of Information’’ and section 

VI ‘‘Regulatory Impact Statement’’ of 

this rule. 

C. Anticipated Effects 

The RFA requires agencies to analyze 

options for regulatory relief of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdictions. Most 

hospitals and most other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues 

of less than $8.0 million to $41.5 

million in any 1 year. Individuals and 

states are not included in the definition 

of a small entity. We are not preparing 

an analysis for the RFA because we have 

determined, and the Secretary certifies, 

that this final rule will not have a 

significant economic impact on a 

substantial number of small entities. 

In addition, section 1102(b) of the Act 

requires us to prepare an RIA if a rule 

may have a significant impact on the 

operations of a substantial number of 

small rural hospitals. This analysis must 

conform to the provisions of section 604 

of the RFA. For purposes of section 

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

rural hospital as a hospital that is 

located outside of a Metropolitan 

Statistical Area for Medicare payment 

regulations and has fewer than 100 

beds. We are not preparing an analysis 

for section 1102(b) of the Act because 

we have determined, and the Secretary 

certifies, that this final rule will not 

have a significant impact on the 

operations of a substantial number of 

small rural hospitals. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule whose mandates require spending 

in any 1 year of $100 million in 1995 

dollars, updated annually for inflation. 

In 2022, that threshold is approximately 

$165 million. This rule will have no 

consequential effect on state, local, or 

tribal governments or on the private 

sector. 


lotter on DSK11XQN23PROD with RULES1
Federal Register / Vol. 87, No. 83 / Friday, April 29, 2022 / Rules and Regulations 25427 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a 

proposed rule (and subsequent final 

rule) that imposes substantial direct 

requirement costs on state and local 

governments, preempts state law, or 

otherwise has Federalism implications. 

Since this regulation does not impose 

any costs on state or local governments, 

the requirements of Executive Order 

13132 are not applicable. 

Chiquita Brooks-LaSure, 

Administrator of the Centers for 

Medicare & Medicaid Services, 

approved this document on April 20, 

2022. 

List of Subjects 

42 CFR Part 410 

Diseases, Health facilities, Health 

professions, Laboratories, Medicare, 

Reporting and recordkeeping 

requirements, Rural areas, X-rays. 

42 CFR Part 414 

Administrative practice and 

procedure, Biologics, Diseases, Drugs, 

Health facilities, Health professions 

Medicare, Reporting and recordkeeping 

requirements. 

42 CFR Part 488 

Administrative practice and 

procedure, Health facilities, Health 

professions, Medicare, Reporting and 

recordkeeping requirements. 

42 CFR Part 493 

Administrative practice and 

procedure, Grant programs-health, 

Health facilities, Laboratories, Medicaid, 

Medicare, Penalties, Reporting and 

recordkeeping requirements. 

For the reasons stated in the 

preamble, the Centers for Medicare & 

Medicaid Services amends 42 CFR 

chapter IV as set forth below: 

PART 410—SUPPLEMENTARY 

MEDICAL INSURANCE (SMI) 

BENEFITS 

■ 1. The authority citation for part 410 

continues to read as follows: 

Authority: 42 U.S.C. 1302, 1395m, 

1395hh, 1395rr, and 1395ddd. 

■ 2. Section 410.142 is amended by 

adding paragraph (k) to read as follows: 

§ 410.142 CMS process for approving 

national accreditation organizations. 

* * * * * 

(k) Change of ownership. An 

accreditation organization whose 

accreditation program(s) is (are) 

approved and recognized by CMS that 

wishes to undergo a change of 

ownership is subject to the requirements 

set out at § 488.5(f) of this chapter. 

PART 414—PAYMENT FOR PART B 

MEDICAL AND OTHER HEALTH 

SERVICES 

■ 3. The authority citation for part 414 

continues to read as follows: 

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

1395rr(b)(l). 

■ 4. Section 414.68 is amended by 

adding paragraph (j) to read as follows: 

§ 414.68 Imaging accreditation. 

* * * * * 

(j) Change of ownership. An 

accreditation organization whose 

accreditation program(s) is (are) 

approved and recognized by CMS that 

wishes to undergo a change of 

ownership are subject to the 

requirements set out at § 488.5(f) of this 

chapter. 

PART 488—SURVEY, CERTIFICATION, 

AND ENFORCEMENT PROCEDURES 

■ 5. The authority citation for part 488 

continues to read as follows: 

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

■ 6. Section 488.5 is amended by adding 

paragraph (f) to read as follows: 

§ 488.5 Application and re-application 

procedures for national accrediting 

organizations. 

* * * * * 

(f) Change of ownership. What 

Constitutes Change of Ownership. A 

description of what could constitute a 

change of ownership with respect to a 

national accrediting organization are 

those activities described in 

§ 489.18(a)(1) through (3) of this 

chapter. 

(1) Notice to CMS. Any CMSapproved accrediting organization that 

is contemplating or negotiating a change 

of ownership must notify CMS of the 

change of ownership. 

(i) This notice requirement applies to 

any national accrediting organization 

with CMS-approved accreditation 

program(s) that is the subject of a 

potential or actual change of ownership 

transaction, including accrediting 

organizations for Advanced Diagnostic 

Imaging (ADI) suppliers; Home Infusion 

Therapy (HIT) suppliers; Diabetic SelfManagement Training (DSMT) entities, 

and clinical laboratories. 

(ii) This notice must be provided to 

CMS in writing. 

(iii) This notice must be provided to 

CMS no less than 90 calendar days prior 

to the anticipated effective date of the 

change of ownership transaction. 

(iv) CMS will complete their review of 

the AO’s request for approval for the 

transfer of the existing CMS approval for 

the accreditation programs to be 

transferred in the change of ownership 

within 90 days from receipt of said AO’s 

request. 

(2) Information submitted with the 

request for approval for change of 

ownership transaction. The person(s) or 

organization(s) acquiring an existing 

CMS-approved accrediting organization 

or accreditation programs (that is, 

purchaser, buyer or transferee) through 

a change of ownership transaction must 

do the following: 

(i) Seek approval from CMS for the 

purchase or transfer of the existing CMS 

approval for the accreditation 

program(s) to be transferred in the 

change of ownership event; and 

(ii) Meet the requirements of 

paragraphs (f)(2)(iii) through (f)(4) of 

this section to demonstrate that the 

entities that will be accredited with the 

transferred accrediting program(s) 

continue to meet or exceed the 

applicable Medicare conditions or 

requirements. 

(iii) The following information must 

be submitted to CMS in the purchaser’s/ 

buyer’s/transferee’s request for approval 

of a transfer of the existing CMS 

approval for the accreditation 

program(s) to be transferred in the 

change or ownership transaction: 

(A) The legal name and address of the 

new owner; 

(B) The three most recent audited 

financial statements of the organization 

that demonstrate the organization’s 

staffing, funding and other resources are 

adequate to perform the required 

surveys and related activities; 

(C) A transition plan that summarizes 

the details of how the accreditation 

functions will be transitioned to the 

new owner, including: 

(1) Changes to management and 

governance structures including current 

and proposed organizational charts; 

(2) A list of the CMS-approved 

accreditation programs that will be 

transferred to the purchaser/buyer/ 

transferee, 

(3) Employee changes, if applicable, 

(4) Anticipated timelines for action; 

(5) Plans for notification to 

employees; and 

(6) Any other relevant information 

that CMS finds necessary. 

(D) The prospective new AO’s 

policies and procedures to avoid 

conflicts of interest, including the 

appearance of conflicts of interest, 

involving individuals who conduct 

surveys or participate in accreditation 

decisions, as required by paragraph 

(f)(10) of this section. 


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25428 Federal Register / Vol. 87, No. 83 / Friday, April 29, 2022 / Rules and Regulations 

(3) Written acknowledgements. The 

purchaser/buyer/transferee must 

provide a written acknowledgement to 

CMS, which states the following: 

(i) If the application for the transfer of 

the existing CMS-approval for the 

accreditation program(s) to be 

transferred in the change of ownership 

transaction is approved by CMS, said 

purchaser/buyer/transferee must assume 

complete responsibility for the 

operations (that is, managerial, 

financial, and legal) of the CMSapproved accreditation programs 

transferred, immediately upon the 

finalization of the change of ownership 

transaction; 

(ii) The purchaser/buyer/transferee 

agrees to operate the transferred CMSapproved accreditation program(s) 

under all of the CMS imposed terms and 

conditions, to include program reviews 

and probationary status terms, currently 

approved by CMS; and 

(iii) The purchaser/buyer/transferee 

must not operate the accreditation 

program(s) it acquired in the change in 

ownership transaction as CMS approved 

accreditation programs, until the 

effective date set forth within the notice 

of approval from CMS. 

(iv) The purchaser/buyer/transferee 

agrees to operate the transferred CMSapproved accreditation program(s) 

under all of the terms and conditions 

found at §§ 488.5 through 488.9. 

(4) Notification. The following written 

notifications are required after the 

change of ownership transaction has 

been approved by CMS: 

(i) All parties to the change of 

ownership transaction must notify the 

providers and suppliers affected by such 

change within 15 calendar days after 

being notified of CMS’s approval of the 

transfer of the existing CMS-approval 

for the accreditation programs to be 

transferred in the change of ownership 

transaction. 

(ii) If applicable, the purchaser/buyer/ 

transferee must acknowledge in writing 

to CMS that the accrediting organization 

or accreditation program(s) being 

acquired through a purchase or transfer 

of ownership was under a performance 

review or under probationary status at 

the time the change of ownership notice 

was submitted. 

(5) Federal Register notice. CMS 

will publish a notice of approval in the 

Federal Register of the transfer of the 

existing CMS approval for the 

accreditation program(s) to be 

transferred to the new owner, only after 

CMS receives written confirmation from 

the new owner that the change of 

ownership has taken place. 

(6) Notification to parties in the event 

that CMS does not approve the transfer 

of the existing CMS approval. In the 

event that CMS does not approve the 

transfer of the existing CMS approval for 

the accreditation program(s) to be 

transferred in the change of ownership 

transaction, CMS will notify all parties 

to the change of ownership transaction 

of such in writing. 

(7) Withdrawal of CMS approval for 

transferred accreditation programs due 

to failure to notify CMS of intent to 

transfer accreditation programs. In the 

event that CMS was not made aware of 

or did not approve the transfer of the 

existing CMS-approval for the 

accreditation program(s) to be 

transferred under a change of 

ownership: 

(i) The existing AO would be 

permitted to continue operating their 

existing CMS-approved accreditation 

programs, if the change of ownership 

transaction was not completed, unless 

our review of the transaction revealed 

issues with the AO that were the subject 

of the un-finalized change of ownership 

transaction that was previously 

unknown to CMS. 

(ii) If a change of ownership 

transaction was completed without 

notice to CMS or the approval of CMS, 

CMS would be able to withdraw the 

existing approval of the AO’s 

accreditation programs in accordance 

with § 488.8(c)(3)(ii) and (iii). 

(8) Withdrawal of CMS approval for 

accreditation programs which are 

transferred notwithstanding CMS’ 

disapproval of the transfer. In the event 

that the parties complete the change of 

ownership transaction, notwithstanding 

CMS disapproval and the purchaser/ 

buyer/transferee attempts to operate the 

transferred accreditation program(s) 

under the CMS-approval granted to the 

previous owner, CMS will withdraw the 

existing approval of the transferred 

accreditation program(s) in accordance 

with the procedures set out at 

§§ 488.8(c)(3)(ii) and (iii). 

(9) Requirements for continuation of a 

deemed status accreditation of 

Medicare-certified providers and 

suppliers after CMS withdraws the 

existing approval of the transferred 

accreditation program(s). If CMS 

withdraws the existing approval of the 

transferred accreditation program(s) 

because the change of ownership 

transaction was completed without 

notice to CMS or the approval of CMS, 

an affected Medicare-Certified provider 

or supplier’s deemed status will 

continue in effect for 180 calendar days 

if the Medicare-Certified provider or 

supplier takes the following steps set 

forth is § 488.8(g). 

(i) The Medicare-certified provider or 

supplier must submit an application to 

another CMS-approved accreditation 

program within 60 calendar days from 

the date of publication of the removal 

notice in the Federal Register; and 

(ii) The Medicare-certified provider or 

supplier must provide written notice to 

the SA that it has submitted an 

application for accreditation under 

another CMS-approved accreditation 

program within this same 60-calendar 

day timeframe in accordance with 

§ 488.8(g). 

(iii) Failure to comply with the 

timeframe requirements specified in 

§ 488.8(g) will place the provider or 

supplier under the SA’s authority for 

continued participation in Medicare and 

on-going monitoring. 

(10) Requirements for continuation of 

accreditation for non-certified suppliers 

when CMS withdraws the existing 

approval of the transferred accreditation 

program(s). If CMS withdraws its 

existing approval from a transferred 

non-certified accreditation program for 

Advanced Diagnostic Imaging (ADI) 

suppliers; Home Infusion Therapy (HIT) 

suppliers; Diabetic Self-Management 

Training (DSMT) entities; or clinical 

laboratories, because a change of 

ownership transaction was completed 

without notice to or the approval of 

CMS, such affected non-certified 

supplier’s deemed status would 

continue in effect for 1 year after the 

removal of the existing CMS 

accreditation approval, if such noncertified supplier take the steps 

specified paragraphs (f)(10)(i) and (ii) of 

this section— 

(i) The non-certified supplier must 

submit an application to another CMSapproved accreditation program within 

60 calendar days from the date of 

publication of the removal notice in the 

Federal Register; and 

(ii) The non-certified supplier must 

provide written notice to CMS stating 

that it has submitted an application for 

accreditation under another CMSapproved accreditation program within 

the 60-calendar days from the date of 

publication of the removal notice in the 

Federal Register. 

(iii) Failure to comply with the abovestated timeframe requirements will 

result in de-recognition of such provider 

or supplier’s accreditation. 

■ 7. Section 488.1030 is amended by 

adding paragraph (g) to read as follows: 

§ 488.1030 Ongoing review of home 

infusion therapy accrediting organizations. 

* * * * * 

(g) Change of ownership. An 

accrediting organization that wishes to 

undergo a change of ownership is 

subject to the requirements set out at 

§ 488.5(f). 


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Federal Register / Vol. 87, No. 83 / Friday, April 29, 2022 / Rules and Regulations 25429 

PART 493—LABORATORY 

REQUIREMENTS 

■ 8. The authority citation for part 493 

is revised to read as follows: 

Authority: 42 U.S.C. 263a, 1302, 1395x(e), 

the sentence following 1395x(s)(11) through 

1395x(s)(16). 

■ 9. Section 493.553 is amended by 

adding paragraph (e) to read as follows: 

§ 493.553 Approval process (application 

and reapplication) for accreditation 

organizations and State licensure 

programs. 

* * * * * 

(e) Change of ownership. An 

accrediting organization that wishes to 

undergo a change of ownership is 

subject to the requirements set out at 

§ 488.5(f) of this chapter. 

Dated: April 25, 2022. 

Xavier Becerra, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2022–09102 Filed 4–27–22; 4:15 pm] 

BILLING CODE 4120–01–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 660 

[Docket No. 220425–0104] 

RIN 0648–BK43 

Fisheries Off West Coast States; West 

Coast Salmon Fisheries; Federal 

Salmon Regulations for Overfished 

Species Rebuilding Plans 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Final rule. 

SUMMARY: NMFS is revising regulations 

that implement the Pacific Fishery 

Management Council’s (Council) Pacific 

Coast Salmon Fishery Management Plan 

(FMP). This action removes a rebuilding 

plan for Sacramento River fall-run 

Chinook salmon (SRFC) from regulation, 

as this stock has been rebuilt and is no 

longer required to be managed under a 

rebuilding plan; and updates language 

to reflect the 2013 merger of NMFS’ 

Northwest Region (NWR) and 

Southwest Region (SWR), which created 

NMFS’ West Coast Region (WCR). 

DATES: Effective May 31, 2022. 

FOR FURTHER INFORMATION CONTACT: 

Shannon Penna, Fishery Management 

Specialist, at 562–676–2148, or 

Shannon.Penna@noaa.gov. 

SUPPLEMENTARY INFORMATION: 

Regulations at 50 CFR part 660, subpart 

H implement the management of West 

Coast salmon fisheries under the FMP in 

the exclusive economic zone (3 to 200 

nautical miles (5.6–370.4 kilometers)) 

off the coasts of the states of 

Washington, Oregon, and California. 

In 2018, NMFS determined that SRFC 

was overfished under the MagnusonStevens Fishery and Conservation 

Management Act (MSA). The Council 

developed a rebuilding plan for SRFC, 

which it transmitted to NMFS on 

August 14, 2019. The Council 

recommended as the rebuilding plan the 

existing control rule for SRFC, which is 

described in the FMP and referenced in 

codified regulation at 50 CFR 

660.410(c). The Council determined that 

the existing control rule met the MSA 

requirement to rebuild the stock as 

quickly as possible, taking into account 

the status and biology of any overfished 

stock and the needs of fishing 

communities (50 CFR 600.310(j)(3)(i)). 

NMFS approved and implemented the 

Council’s recommended rebuilding plan 

for SRFC through rulemaking. 50 CFR 

660.413(b), (85 FR 75920; November 27, 

2020). 

In 2021, NMFS determined that SRFC 

met the criteria in the FMP for being 

rebuilt and notified the Council (Letter 

from Barry A. Thom, NMFS West Coast 

Regional Administrator, to Charles A. 

Tracy, Pacific Fishery Management 

Council Executive Director, dated July 

23, 2021). As the stock is rebuilt, it is 

no longer required to be managed under 

a rebuilding plan and the SRFC 

rebuilding plan should be removed from 

regulation to avoid confusion regarding 

the stock’s status. Additionally, 

removing the SRFC rebuilding plan 

from regulation will avoid confusion 

should NMFS make a future 

determination that the SRFC stock is 

overfished again, in which case the 

MSA requires the Council to prepare 

and implement a rebuilding plan within 

two years of that determination (50 CFR 

600.310(j)(2)(ii)). Leaving the current 

rebuilding plan in regulation could be 

confused as being the default rebuilding 

plan for SRFC, which is the intention of 

neither the Council nor of NMFS. 

Therefore, to avoid confusion, it is 

necessary to remove the existing SRFC 

rebuilding plan from regulation. 

Because the rebuilding plan adopted the 

existing harvest control rule for SRFC 

described in the Pacific Coast Salmon 

Fishery Management Plan, removing the 

rebuilding plan from regulation will not 

change the management of salmon 

fisheries that affect SRFC. NMFS 

determined that a 15-day comment 

period for the proposed rule was 

appropriate to allow adequate time for 

public comment while also allowing for 

the final rule to be in effect prior to the 

annual preseason management process 

for the 2022 ocean salmon fisheries, 

thereby avoiding confusion about the 

status of SRFC prior to the fishing 

season. 

In 2013, NMFS implemented a 

realignment that merged the NWR and 

SWR to create the WCR. This change 

was made in order to more effectively 

manage resources, decision-making, and 

policy from a holistic West Coast 

perspective. NMFS is revising the 

regulations at 50 CFR 660, subpart H, to 

reflect the 2013 merger of NMFS’ NWR 

and SWR by replacing mentions of NWR 

and SWR with WCR, and by replacing 

mention of the Northwest and 

Southwest Regional Administrators 

with West Coast Regional 

Administrator. 

Public Comment 

No comments were received during 

the public comment period. 

Classification 

NMFS is issuing this rule pursuant to 

section 305(d) of the MSA. The reason 

for using this regulatory authority is: 

Pursuant to section 305(d) of the MSA 

section, this action is necessary to carry 

out administrative actions, because it 

will revise outdated regulations. 

This final rule has been determined to 

be not significant for purposes of 

Executive Order 12866. 

The Chief Counsel for Regulation of 

the Department of Commerce certified 

to the Chief Counsel for Advocacy of the 

Small Business Administration during 

the proposed rule stage that this action 

would not have a significant economic 

impact on a substantial number of small 

entities. The factual basis for the 

certification was published in the 

proposed rule and is not repeated here. 

No comments were received regarding 

this certification. As a result, a 

regulatory flexibility analysis was not 

required and none was prepared. 

This Final rule contains no 

information collection requirements 

under the Paperwork Reduction Act of 

1995. 

List of Subjects in 50 CFR Part 660 

Fisheries, Fishing, and Recording and 

reporting requirements. 

Dated: April 25, 2022. 

Samuel D. Rauch, III, 

Deputy Assistant Administrator for 

Regulatory Programs, National Marine 

Fisheries Service. 

For the reasons set out in the 

preamble, NMFS amends 50 CFR part 

660 as follows: 


lotter on DSK11XQN23PROD with RULES1