[Federal Register Volume 70, Number 23 (Friday, February 4, 2005)]
[Notices]
[Pages 6013-6014]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-2176]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-1299-N]


Medicare Program; Monthly Payment Amounts for Oxygen and Oxygen 
Equipment for 2005, in Accordance with Section 302(c) of the Medicare 
Prescription Drug, Improvement, and Modernization Act of 2003

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

ACTION: Notice.

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SUMMARY: This notice discusses a reduction in the 2005 monthly payment 
amounts for oxygen and oxygen equipment based on the percentage 
difference between Medicare's 2002 monthly payment amounts for each 
State and the median 2002 Federal Employee Health Benefit plan price 
reported by the Office of Inspector General. This reduction is required 
by section 302(c) of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003.

FOR FURTHER INFORMATION CONTACT: Joel Kaiser, (410) 786-4499, 
<a href="/cdn-cgi/l/email-protection#274d4c464e54425567444a54094f4f5409404851"><span class="__cf_email__" data-cfemail="8fe5e4eee6fceafdcfece2fca1e7e7fca1e8e0f9">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

I. Background

    In accordance with section 302(c) of the Medicare Prescription 
Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-
173, enacted on December 8, 2003), Medicare's monthly payment amounts 
for oxygen and oxygen equipment for 2005 are to include a reduction 
based on the percentage difference between Medicare's 2002 monthly 
payment amounts for each State and the median 2002 Federal Employee 
Health Benefit (FEHB) plan price reported by the Office of Inspector 
General (OIG). The OIG has alerted us that they will need to collect 
additional information before the FEHB medians for oxygen and oxygen 
equipment and portable oxygen equipment are finalized. Therefore, 
Medicare claims for oxygen and oxygen equipment and portable oxygen 
equipment furnished on or after January 1, 2005, and identified by the 
Healthcare Common Procedure Coding System codes listed below, will be 
temporarily paid based on the 2004 monthly payment amounts. In 
accordance with the authority provided by section 1871(e)(1)(A)(ii) of 
the Social Security Act, we are making this change retroactive for 
items and services furnished on or after January 1, 2005, because we 
have determined that it would be contrary to the public interest to 
implement 2005 payment amounts based on preliminary and potentially 
erroneous data.
    <bullet> E0424--Stationary Compressed Gaseous Oxygen System, 
Rental: Includes container, contents, regulator, flowmeter, humidifier, 
nebulizer, cannula or mask, and tubing;
    <bullet> E0439--Stationary Liquid Oxygen System, Rental: Includes 
container, contents, regulator, flowmeter, humidifier, nebulizer, 
cannula or mask, and tubing;
    <bullet> E1390--Oxygen Concentrator, Single delivery port, capable 
of delivering 85 percent or greater oxygen concentration at the 
prescribed flow rate delivery port, capable of delivering 85 percent or 
greater oxygen concentration at the prescribed flow rate;
    <bullet> E1391--Oxygen Concentrator, Dual delivery port, capable of 
delivering 85 percent or greater oxygen concentration at the prescribed 
flow rate;
    <bullet> E0431--Portable Gaseous Oxygen System, Rental: Includes 
portable container, regulator, flowmeter, humidifier, cannula or mask, 
and tubing;
    <bullet> E0434--Portable Liquid Oxygen System, Rental: Includes 
portable container, supply reservoir, humidifier, flowmeter, refill 
adaptor, contents gauge, cannula or mask, and tubing.
    Once we receive the FEHB medians from the OIG, we will calculate 
and implement the 2005 monthly payment amounts and will begin paying 
claims using these amounts. These amounts will apply prospectively 
only. This is explained at http://www.cms.hhs.gov/suppliers/dmepos/. 
Any future updates will also be published at this website.

[[Page 6014]]

II. Provisions of the Notice

    The purpose of this notice is to notify the public that the OIG has 
informed us of their need for additional information before the 
provision may be used and implemented to reduce monthly payment amounts 
for oxygen and oxygen equipment, based on the percentage difference 
between Medicare's 2002 monthly payment amounts for each State and the 
median 2002 Federal Employee Health Benefit plan price reported by the 
OIG.

III. Collection of Information Requirements

    This document does not impose information collection and 
recordkeeping requirements. Consequently, it need not be reviewed by 
the Office of Management and Budget under the authority of the 
Paperwork Reduction Act of 1995.

IV. Regulatory Impact Statement

    We have examined the impact of this notice as required by Executive 
Order 12866 (September 1993, Regulatory Planning and Review), the 
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), 
section 1102(b) of the Social Security Act, the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132.
    Executive Order 12866 directs 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 notice 
does not reach the economic threshold and thus is not considered a 
major rule.
    The RFA requires agencies to analyze options for regulatory relief 
of small businesses. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and government agencies. 
Most hospitals and most other providers and suppliers are small 
entities, either by nonprofit status or by having revenues of $6 
million to $29 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 that this notice 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 a regulatory impact analysis if a rule may have a significant 
impact on the operations of a substantial number of small rural 
hospitals. This analysis must conform to the provisions of section 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 and has fewer than 100 beds. We are not 
preparing an analysis for section 1102(b) of the Act because we have 
determined that this notice 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 that may result in expenditure in any 1 year by State, 
local, or tribal governments, in the aggregate, or by the private 
sector, of $110 million. This notice will have no consequential effect 
on the governments mentioned or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on State 
and local governments, preempts State law, or otherwise has Federalism 
implications. Since this regulation does not impose any costs on State 
or local governments, the requirements of E.O. 13132 are not 
applicable.
    In accordance with the provisions of Executive Order 12866, this 
document was not reviewed by the Office of Management and Budget.

    Authority: Section 302(c) of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003 (MMA).

(Catalog of Federal Domestic Assistance Program No. 93.774, Medicare-
Supplemental Medical Insurance Program)

    Dated: January 19, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 05-2176 Filed 2-3-05; 8:45 am]
BILLING CODE 4120-01-P


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