Source: https://www.federalregister.gov/documents/2007/07/20/E7-13535/medicare-program-revised-civil-money-penalties-assessments-exclusions-and-related-appeals-procedures
Timestamp: 2018-04-19 23:43:53
Document Index: 172637951

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Federal Register :: Medicare Program; Revised Civil Money Penalties, Assessments, Exclusions, and Related Appeals Procedures
Medicare Program; Revised Civil Money Penalties, Assessments, Exclusions, and Related Appeals Procedures
A Rule by the Centers for Medicare & Medicaid Services on 07/20/2007
72 FR 39746
39746-39756 (11 pages)
CMS-6146-F
CMS-6019-F
E7-13535
B. Timelines for Publication of This Medicare Final Rule
II. Provisions of the Proposed Rules and Analysis and Responses to Public Comments
A. Provisions of the July 23, 2004 Proposed Rule
1. Basis and Purpose (Proposed § 402.200)
2. Length of Exclusion (Proposed § 402.205)
3. Factors Considered in Determining Whether To Exclude, and the Length of Exclusion (Proposed § 402.208)
4. Scope and Effect of Exclusion (Proposed § 402.209)
5. Notice of Exclusion (Proposed § 402.210)
6. Response to Notice of Proposed Exclusion (Proposed § 402.212)
7. Appeal of Exclusion (Proposed § 402.214)
8. Request for Reinstatement (Proposed § 402.300)
9. Basis for Reinstatement (Proposed § 402.302)
10. Approval of Request for Reinstatement (Proposed § 402.304)
11. Denial of Request for Reinstatement (Proposed § 402.306)
B. Provisions of the August 4, 2005 Proposed Rule
1. Waiver of Exclusions (Proposed § 402.308)
Scope and Effect of Exclusion (§ 402.209)
Response to Notice of Proposed Determination to Exclude (§ 402.212).
Appeal of Exclusion (§ 402.214)
Request for Reinstatement (§ 402.300)
Denial of Request for Reinstatement (§ 402.306)
Waivers of Exclusions (§ 402.308)
List of Subjects in 42 CFR Part 402
https://www.federalregister.gov/d/E7-13535 https://www.federalregister.gov/d/E7-13535
This final rule establishes the procedures for imposing exclusions for certain violations of the Medicare program and is based on the procedures that the Office of Inspector General has published for civil money penalties, assessments, and exclusions under their delegated authority. Implementation of this final rule protects beneficiaries from persons (that is, health care providers and entities) found in noncompliance with Medicare regulations, and otherwise improves the safeguard provisions under the Medicare statute. This final rule also establishes procedures that enable a person targeted for exclusion from the Medicare program to request the Centers for Medicare & Medicaid Services to act on its behalf to recommend to the Inspector General that the exclusion from Medicare be waived due to hardship that would be placed on Medicare beneficiaries as a result of the person's exclusion.
Effective Date: This final rule is effective on August 20, 2007.
Section 2105 of the Omnibus Budget Reconciliation Act of 1981 (Pub. L. 97-35) added section 1128A to the Social Security Act (the Act) to authorize the Secretary of Health and Human Services (HHS) to impose civil money penalties (CMPs), assessments, and exclusions from the Medicare program for certain persons (that is, health care facilities, practitioners, suppliers, or other entities) under certain circumstances. Exclusion provides the ultimate enforcement tool for agencies attempting to establish compliance with legal and program standards, and is used in addition to potential civil, criminal, and other administrative proceedings.
Since 1981, the Congress has significantly increased both the number and types of circumstances under which the Secretary may impose the exclusion of a person from the Medicare and State health care programs. The Secretary has delegated the authority for these provisions to either the Office of the Inspector General (OIG) or CMS (October 20, 1994 rule, 59 FR 52967). The exclusion authorities delegated to the OIG for the most part address fraud, misrepresentation, or falsification, while those that address noncompliance with programmatic or regulatory requirements are delegated to CMS. However, the OIG has the authority to impose exclusions and to prosecute cases involving exclusions that were delegated to CMS, if CMS and the OIG jointly determine it to be in the interest of economy, efficiency, or effective coordination of activities. The determination may be made either on a case-by-case basis, or for all cases brought under a particular listed authority.
In the December 14, 1998 Federal Register (63 FR 68687), we published a final rule entitled “Medicare and Medicaid Program; Civil Money Penalties, Assessments, Exclusions, and Related Appeals Procedures.” That rule set forth the procedures for pursuing civil money penalties (CMPs) and assessments, and added a new part 402 to title 42, chapter IV of the Code of Federal Regulations (CFR) to incorporate our CMP and assessment authorities. However, we did not address exclusions in that final rule. Instead, we reserved subpart C for exclusions so that we could incorporate the relevant regulations at a future date.
In the December 14, 1998 final rule, we indicated that our procedures for imposing the CMPs and assessment authorities delegated to CMS were based on the procedures that the OIG had delineated in 42 CFR part 1003. We also made the OIG's hearing and appeal procedures set forth in 42 CFR part 1005 applicable to the CMP, assessment, and exclusion authorities delegated to us.
In the July 23, 2004 Federal Register (69 FR 43956), we published a proposed rule entitled “Medicare Program; Revised Civil Money Penalties, Assessments, Exclusions, and Related Appeals Procedures.” This proposed rule would amend subpart C by establishing the procedures for imposing exclusions for certain violations of the Medicare program. The proposed rule would incorporate the general requirements and procedures that are common to the imposition of an exclusion from the Medicare program.
In the August 4, 2005 Federal Register (70 FR 44879), we published a proposed rule entitled “Medicare Program; Revised Civil Money Penalties, Assessments, Exclusions and Related Appeals Procedures” that would implement section 949 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-173). Section 949 of the MMA amended section 1128(c)(3)(B) of the Act to indicate that “[s]ubject to Start Printed Page 39747subparagraph (g), in the case of an exclusion under subsection (a), the minimum period of exclusion shall be not less than 5 years, except that, upon the request of the administrator of a Federal health care program (as defined in section 1128B(f)) who determines that the exclusion would impose a hardship on individuals entitled to benefits under Part A of title XVIII or enrolled under Part B of such title, or both, the Secretary may, after consulting with the Inspector General of the Department of Health and Human Services, waive the exclusion under subsection (a)(1), (a)(3), or (a)(4) with respect to that program in the case of an individual or entity that is the sole community physician or sole source of essential specialized services in the community.” The Conference Agreement accompanying the MMA clarifies the intent of the statutory requirement that a hardship determination be made before a waiver is approved. In short, we proposed the general requirements and procedures that would allow certain providers and entities identified for exclusion from the Medicare program to request that we act on their behalf to recommend to the OIG that their exclusion from Medicare be waived because of a hardship that would result on Medicare beneficiaries. We also stated in this proposed rule our intent to respond to the public comments we received from the July 23, 2004 proposed rule and this proposed rule in a single final rule.
Section 902 of the 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 rules based on the previous publication of a Medicare proposed or interim final rule. Section 902 of the MMA also states that the timelines for these rules may vary, but must not exceed 3 years after publication of the preceding proposed or interim final rule, except under exceptional circumstances.
This final rule finalizes provisions set forth in the July 23, 2004 and the August 4, 2005 proposed rules. In addition, this final rule will be published within the 3-year time limit imposed by section 902 of the MMA. Therefore, this final rule will be published in accordance with the Congress' intent for ensuring timely publication of final rules.
This proposed rule would amend part 402, subpart C, (Exclusions) to incorporate the rules concerning exclusions associated with the CMP violations identified in part 402. Subpart C contains the general requirements and procedures that are common to the imposition of an exclusion from Medicare, Medicaid, and (where applicable) other Federal health care programs. (These regulations do not materially impact the hearing and appeals procedures currently available to any person on whom we could impose an exclusion.)
We proposed adding the following provisions under part 402 subpart C.
Section 402.200 provides the basis and purpose for the imposition of an exclusion from Medicare, Medicaid, and (where applicable) other Federal health care programs based on noncompliance with the respective provisions of part 402 subpart A, § 402.1(e). This subpart also sets forth the appeal rights of a person subject to exclusion, as well as the procedures for a person's reinstatement following an exclusion. (This subpart is based on § 1003.102, § 1003.105, § 1003.107, and § 1003.109 of the OIG's regulations.)
This section describes the duration of exclusion from Medicare, Medicaid, and (where applicable) other Federal health care programs for the applicable violation. Currently, there are four general categories for which violations may cause exclusions. These categories involve noncompliance with assignment billings, noncompliance with charge or service limits, failure to provide information, or improperly providing information.
Some exclusion provisions provide that the exclusion is imposed in accordance with section 1842(j)(2) of the Act, which provides for exclusion from participation in programs under the Act. These exclusions may not exceed 5 years. For these exclusion provisions, we propose using our discretion to set a duration for the exclusion, up to 5 years, after considering aggravating and mitigating circumstances as described in the July 23, 2004 proposed rule (69 FR 43956).
By contrast, many other exclusion provisions extend to all Federal health care programs, and do not address the minimum or maximum duration of the exclusion. Instead, they simply refer to applying the provisions of section 1128A of the Act or section 1128(c) of the Act for imposition of the exclusion. However, neither section 1128A of the Act, nor section 1128(c) of the Act, address the specific duration of an exclusion for any of the title XVIII exclusion provisions described in this proposed rule. Therefore, where the duration of an exclusion is not specifically addressed by statute for a specific exclusion provision, we proposed using our discretion to apply a time period we believed was justified, taking into account appropriate aggravating and mitigating factors that are described in the July 23, 2004 proposed rule (69 FR 43956).
While several provisions of title XVIII of the Act refer on their face only to CMPs, they also make cross-references to section 1128A of the Act, from which we assert that our exclusion authority derives. This is the case with both sections 1877 and 1882 of the Act. Each of these provisions incorporates by reference portions of section 1128A of the Act, articulating with specificity which section 1128A provisions are applicable. In each case, this includes section 1128A's exclusion authority (and, in the case of section 1877 of the Act, the exclusion authority is made even more clear with the term “exclusion” being found in the section heading). The applicable provision of section 1128A of the Act is the provision's last sentence, explicitly made applicable to all the foregoing, which provides that the Secretary “may make a determination in the same [CMP] proceeding to exclude the person from participation in Federal health care programs.”
The statute specifies the grounds for imposition of the various exclusions, but offers little detail regarding the adjudicatory processes inherent in administering them. Instead, the statute vests us with broad administrative discretion. We are sensitive to the fact that the nature of grounds for imposition of exclusions vary widely.
Proposed § 402.208 would provide the specific details of the aggravating and mitigating circumstances that may be considered. (This section is based on the corresponding OIG sections of 42 CFR parts 1001 and 1003.) We note that our application of aggravating and Start Printed Page 39748mitigating factors flows both as a natural result of a statutory scheme that contemplates exclusions of varying lengths, as well as the Secretary's rulemaking authority specified in section 1871 of the Act.
Proposed § 402.209 would provide the general scope and effect of an exclusion. Generally, an excluded person may not directly or indirectly submit claims, or cause claims to be submitted, to the Medicare program. A person who submits (or causes to be submitted) claims during the course of an exclusion risks other possible sanctions, including civil and criminal liability. Medicare will not pay claims for beneficiaries who elect to see an excluded person, except, perhaps, for the first claim, which will be accompanied by a notification to the beneficiary that the person has been excluded from participation in Medicare, and that no further Medicare payments will be made on the beneficiary's behalf. (This section is based on criteria provided by the OIG in § 1001.1901.) We note in § 402.209(b)(3) that because in some cases the maximum exclusion time limit may preclude us from applying the specified prohibited conduct as the basis for denying reinstatement to the Medicare program, the fact that an excluded person has engaged in prohibited conduct may give rise to a new exclusion action by the initiating agency (CMS or OIG) that will have the practical effect of denying the person reinstatement into the Medicare program.
Proposed § 402.210 would specify the contents of respective notices and specifically, the timing for release of—(1) the written notice of intent to exclude (that is, the proposed determination); and (2) the written notice of exclusion. At a minimum, the written notice of intent to exclude provides the person with information as to the reason why it is noncompliant with the statute, the length of the proposed exclusion, and instructions for responding to the notice, including providing argument against exclusion for the agency to consider. The written notice to exclude is sent to the person in the same manner as the written notice of intent to exclude if the agency determines that the exclusion is warranted. This notice would also provide the person with information on its appeal rights regarding the exclusion. (This section is based on criteria provided by the OIG in § 1001.2001, § 1001.2002, § 1001.2004, and § 1003.109.)
Proposed § 402.212 would state the general process and procedure for a person to follow when presenting an oral or written response to the notice of intent to exclude (that is, the proposed determination). We would accept for consideration any supportive information the person provides. We would not limit nor suggest what type of information should be presented. The burden to present convincing information is left to the person's discretion. Even though this section is based on the process and procedures delineated by the OIG in § 1003.109, to encourage timely communication between the person and the initiating agency, we have added an additional element whereby the initiating agency would contact the person within 15 days of receipt of the person's request to establish a mutually agreed upon time and place for the oral presentation and discussion.
Proposed § 402.214 would specify the general appeal process for requesting a hearing before an administrative law judge, and details the required elements of the written request for appeal. (This section is based on criteria provided by the OIG in § 1005.) Generally, the elements of the written request must include the basis for the disagreement with the exclusion, the general basis for the person's defense, and reasons why the proposed length of exclusion should be modified. (This section is based on criteria provided by the OIG in § 1001.2003 and § 1001.2007.)
In proposed § 402.300, we specified the request for reinstatement. In § 402.300(a), we described the written request for reinstatement. We stated that an excluded person may submit a written request for reinstatement to the initiating agency no sooner than 120 days prior to the terminal date of exclusion as specified in the notice of exclusion. The written request for reinstatement would be required to include documentation demonstrating that the person has met the standards set forth in § 402.302. We also state that obtaining or reactivating a Medicare provider number (or equivalent) would not constitute reinstatement.
Proposed § 402.300(b) would specify that, upon receipt of a written request for reinstatement, the initiating agency may require the person to furnish additional, specific information and authorization to obtain information from private health insurers, peer review organizations, and others, as necessary, to determine whether reinstatement is granted.
In § 402.300(c), we would state that failure to submit a written request for reinstatement or to furnish the required information or authorization would result in the continuation of the exclusion, unless the exclusion has been in effect for 5 years. In that case, reinstatement would be automatic.
Proposed § 402.300(d) specifies that, if a period of exclusion is reduced on appeal (regardless of whether further appeal is pending), the excluded person would be permitted to request and apply for reinstatement within 120 days of the expiration of the reduced exclusion period. A written request for the reinstatement would include the same standards specified in § 402.300(b). (This section is based on criteria provided by the OIG in § 1001.3001.)
In proposed § 402.302, we would specify that the initiating agency would authorize reinstatement if the agency determines that—(1) The period of exclusion has expired; (2) there are reasonable assurances that the types of actions that formed the basis for the original exclusion will not recur; and (3) there is no additional basis under title XVIII of the Act that will justify the continuation of the exclusion.
We also stated that the initiating agency would not authorize reinstatement if the basis for denying reinstatement lies in an excluded person continuing either to submit claims (or causing claims to be submitted) or to receive and accept payments from the Medicare program for items or services it has furnished, ordered, or prescribed. This section would apply, regardless of whether the excluded person has obtained a Medicare provider number (or equivalent), either as an individual or as a member of a group, before being reinstated.
In making a determination regarding reinstatement, the initiating agency would consider—(1) The conduct of the excluded provider occurring before the date of the notice of the exclusion, if that conduct was not known to the initiating agency at the time of the exclusion; (2) the conduct of the excluded person after the date of the Start Printed Page 39749exclusion; (3) whether all fines and all debts due and owing (including overpayments) to any Federal, State, or local government that relate to Medicare, Medicaid, or (where applicable) any Federal, State, or local health care program were paid in full, or alternatively that satisfactory arrangements were made to fulfill these obligations; (4) whether the excluded person complied with, or had made satisfactory arrangements to fulfill, all of the applicable conditions of participation or conditions of coverage under the Medicare statutes and regulations; and (5) whether the excluded person had, during the period of exclusion, submitted claims (or caused claims to be submitted) or payment to be made by Medicare, Medicaid, and (where applicable) any other Federal health care program for items or services furnished, ordered, or prescribed, and the conditions under which these actions occurred.
We proposed that reinstatement would not be effective until the initiating agency grants the request and provides notice under § 402.304. Reinstatement would be effective as provided in the notice. A determination for a denial of reinstatement will not be appealable or reviewable, except as provided in § 402.306.
We also proposed that an ALJ cannot require reinstatement of an excluded person according to this chapter as specified in § 402.306(d). (The content of this section is based on the criteria provided by the OIG in § 1001.3002.)
With regard to approval of a request for reinstatement (§ 402.304), we would state that, if the initiating agency grants a request for reinstatement, then the initiating agency would—(1) Give written notice to the excluded person specifying the date of reinstatement; and (2) notify appropriate Federal and State agencies, and, to the extent possible, all others that were originally notified of the exclusion, that the person has been reinstated into the Medicare program.
A determination by the initiating agency to reinstate an excluded person would have no effect if Medicare, Medicaid, or (where applicable) any other Federal health care program has imposed a longer period of exclusion under its own authorities. (The content of this section is based on the procedures provided by the OIG in § 1001.3003.)
In proposed § 402.306, we specified that if a request for reinstatement is denied, the initiating agency would provide written notice to the excluded person. Within 30 days of the date of this notice, the excluded person may submit to the initiating agency: (1) Documentary evidence and a written argument challenging the reinstatement denial; or (2) a written request to present written evidence or oral argument to an official of the initiating agency.
If this written request is received timely by the initiating agency, the initiating agency, within 15 days of receipt of the excluded provider or entity's request, would initiate communication with the excluded person to establish a time and place for the requested meeting.
After evaluating any additional evidence submitted by the excluded person (or at the end of the 30-day period described above, if no documentary evidence or written request was submitted), the initiating agency would send written notice to the excluded person either confirming the denial, or approving the reinstatement as set forth in proposed § 402.304. If the initiating agency elects to uphold its denial decision, the written notice would also indicate that a subsequent request for reinstatement would not be considered until at least 1 year after the date of the written denial notice.
The decision to deny reinstatement would not be subject to administrative review. (The content of this section is based on the procedures provided by the OIG in § 1001.3004.)
We received 11 comments related to the July 23, 2004 proposed rule. The following is a summary of the comments received and our responses to them.
Comment: Commenters expressed concern over the discretion that we may apply in setting the duration of exclusion when duration is not addressed by statute.
Response: The statute does not specifically set the duration of exclusion. Therefore, we will consider any and all factors, as listed in § 402.208, presented when weighing our decision on the length of the exclusion. We believe the circumstances and facts presented will provide a basis for determining the appropriate duration on a case-by-case basis.
Comment: Commenters stated that wrongful conduct that occurred at a time otherwise barred by the statute of limitations should not be considered as a factor.
Response: It is our intent to consider any and all applicable factors in making a determination of exclusion from the Medicare program, including past wrongful conduct unrelated to the specific conduct at issue. Unlike the imposition of civil monetary penalties that are only applied to the conduct at issue, we take a different position on imposing an exclusion from the Medicare program.
Comment: One commenter indicated the financial loss to the program associated as an aggravating or mitigating factor was too small. The commenter used as an example a single hospital claim whereby the value of a single claim is typically more than the loss proposed in the rule.
Response: We have drafted this final rule to be adopted as a generic template to account for all types of healthcare providers (for example, hospitals, physicians, and suppliers). The financial factors proposed for aggravating and mitigating circumstances provide us with the ability to consider a low dollar tolerance that would be applicable to both institutional and non-institutional providers.
Comment: One commenter suggested that instead of considering it a mitigating factor when the noncompliance resulted from an unintentional or unrecognized error in a request for payment, and the person took prompt corrective steps once the error was discovered, that this circumstance should mean that no exclusion was warranted.
Response: The circumstances described by the commenter would most likely result in a favorable determination. We would likely consider those particular circumstances as mitigating factors. We will look at all factors and degrees of timeliness and promptness of changing the noncompliant activity before rendering a determination on whether to exclude a person from the Medicare program and the duration of the exclusion period.
Comment: One commenter suggested adding as a mitigating circumstance the fact that the person has an effective compliance program in place.
Response: We agree that an effective compliance program could be considered a mitigating circumstance under § 402.208(b)(3). However, the compliance program would not be considered effective if a violation occurred during the time the program was in effect, and the violation was not identified and remedied by the person prior to CMS identifying the noncompliance. The remedial step of Start Printed Page 39750establishing an effective compliance program may result in the period of exclusion being modified.
Comment: One commenter questioned the knowledge of furnishing services at the request of or direction of an excluded person, and whether, for example, a hospital has any obligation to check the list of excluded persons when furnishing services at the request of another entity.
Response: We believe the exceptions described in § 402.209 address how we view the knowledge factor. With regard to an obligation to check the list of excluded persons, we are not aware of any statutory requirement of this type. While it is not obligatory to check the exclusions list, a provider may wish to voluntarily add this element as part of its compliance program to ensure that all claims for services of this type will be paid.
Comment: One commenter regarded the provision that the exclusion effective date would not be delayed if an appeal was filed timely would deprive the person of economic existence. Therefore, the commenter recommended that the exclusion be stayed until the appeal process had been concluded.
Response: As specified in § 402.210(a), before written notice of the exclusion is sent, the person would receive a notice of proposed determination. The person has the opportunity at this time to present to CMS documentary evidence and a written response, or to make an oral presentation as to why the exclusion should not be imposed. In response, we may not impose the exclusion if we find that the exclusion is unwarranted. Although the commenter may feel that the appeal process is unfair because the exclusion is not delayed, we intend to remain consistent with the process that governs the other Federal agencies.
Comment: One commenter suggested removing or revising the requirement of providing additional information when applying for reinstatement, because that requirement is too onerous, or the additional information requested may include protected information.
Response: If we request additional information, it is the excluded person's decision whether to provide the information. A person who seeks reinstatement should be prepared to provide evidence it deems appropriate to support the reinstatement as defined in § 402.302. However, we would base our determinations on the information that we have been provided.
Comment: One commenter requested that the provision regarding our upholding the initial appeal determination to deny reinstatement should have appeal rights.
Response: In reviewing the provision, the excluded person has two opportunities to present evidence to CMS that may meet the conditions for reinstatement as set forth in § 402.302. These two opportunities to present evidence are detailed in § 402.300(a) and § 402.306(a). Failing to present convincing evidence, the excluded person is again afforded the opportunity 1 year later, as detailed in § 402.306(c). We believe these situations provide an excluded person with adequate opportunity to be heard, and decline to add additional appeal rights.
Comment: One commenter expressed that there was conflict between § 402.210(a) and § 402.212(b) regarding the time period for submitting a request for oral argument.
Response: We reviewed the provisions and have revised the time period in § 402.212(b) to be consistent with the 30-day period in § 402.210(a) for submitting a request to present oral arguments.
Comment: One commenter suggested that the exclusions related to the provisions of section 1882 of the Act are not intended for issuers of Medigap insurance or Medigap insurance policies. The commenter suggested that the Congress did clearly apply civil monetary penalties to the provisions, but made no explicit application or reference to exclusions.
Response: As we discussed previously, section 1882 of the Act cross references section 1128A of the Act, articulating with specificity the applicable portions of the latter statute, which in each case includes section 1128A's exclusion authority. We believe that we have the legal authority to impose exclusions associated with violations of section 1882 of the Act.
This proposed rule would amend part 402, subpart C, (Exclusions) to set forth the general requirements and procedures that would allow persons targeted for exclusion from the Medicare program to request that CMS act on their behalf to recommend to the Inspector General that their exclusion from Medicare be waived because of a hardship that would result on Medicare beneficiaries. These requirements and procedures implement section 949 of the MMA.
We proposed adding the following provisions under subpart C:
In § 402.308, we stated that persons who have been excluded by the Inspector General may request that CMS act on their behalf to recommend to the Inspector General that their exclusion from the Medicare program be waived. We would recommend waiver if we determine that the person's exclusion from the Medicare program would place a hardship on Medicare beneficiaries. Our decision to make the recommendation of a waiver to the Inspector General is not subject to administrative or judicial review. Additionally, our recommendation of waiver is not tantamount to the automatic granting of a waiver, because it is the Inspector General who will make the final decision on whether a waiver should be granted to the excluded person.
We received 2 comments related to the August 4, 2005 proposed rule (CMS-6019-P). Below is a summary of the comments received and our responses to them.
Comment: One commenter indicated it was unable to identify the delegation of section 949 of the MMA waiver authority from the Secretary to the OIG; therefore, the commenter is opposed to the delegation.
Response: Our authority to request a waiver under section 949 of the MMA is specified in § 402.209 of this final rule. The authority of the OIG to grant or deny a request for a waiver is outside the scope of this final rule.
Comment: One commenter requested that we provide a definition with greater clarity for the terms used to describe persons eligible for the exclusion waiver.
Response: We have revised § 402.308(a) to refer to § 1001.2 of the OIG regulations, which define “sole community physician” and “sole source of essential specialized services” in the Medicare community.
We are adopting all of the provisions of the proposed rules as final with the following changes.
Due to a typographical error, we are replacing § 402.105(d)(2)(xix) with § 402.105(d)(2)(ix).
In § 402.308, we are adding the terms “sole community physician” and “sole source of essential specialized services in the community” to the list of definitions. For each term, we are referencing those terms as they are defined by the OIG regulations at § 1001.2. In addition, in § 402.308(b), we are revising the text, “For purposes of Start Printed Page 39751this part” to read as “For purposes of this subpart”.
Section 402.209(c)(2) states that payment may be made for certain emergency items or services furnished by an excluded person, or under the medical direction or on the request of an excluded person during the period of exclusion. In order to be paid, a claim for the emergency items or services must be accompanied by a sworn statement of the person furnishing the items or services, specifying the nature of the emergency and the reason that the items or services were not furnished by a person eligible to furnish or order the items or services.
The burden associated with this requirement is the time and effort associated with drafting and submitting a document containing a sworn statement that explains the circumstances under which services were furnished by an excluded individual. While this requirement does impose a burden, we believe it is exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
Section 412.212 outlines the procedures an individual must follow to submit a response to the notice of intent to exclude. Specifically, § 402.212(a) states that within 60 days of the receipt of the notice, a person may present to the initiating agency a written response to dispute whether the proposed exclusion is appropriate. In addition, the person submitting the written response to the notice may provide additional supportive documentation. The burden associated with this requirement is the time and effort associated with drafting and submitting a written response to the notice.
Section 402.212(b) states that recipient of a notice of intent to exclude is also afforded an opportunity to be heard by the initiating agency in order to make an oral presentation concerning whether the proposed exclusion is warranted. The person must submit the request for an oral presentation within 60 days of the receipt of the notice. The burden associated with this requirement is the time and effort associated with submitting a request for an oral presentation.
While the requirements listed in § 402.212(a) and (b) do impose burdens, we believe they are exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
Section 402.214(b) lists the conditions under which an excluded person may file a request for a hearing before an administrative law judge (ALJ). Section 402.214(d) states that an excluded person must file a request for a hearing within 60 days from the receipt of the notice of exclusion. Section 402.214(e) lists the required content of the written request for a hearing.
The burden associated with these requirements is the time and effort necessary to draft and submit a request for a hearing with an ALJ as stated in § 402.214(d). In addition, the person must ensure that the request contains all of the information outlined in § 402.214(e). While these requirements do impose burdens, we believe they are exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
Section 402.300(a) explains that an excluded person may submit a request for reinstatement to the agency initiating the exclusion. An excluded person must submit a written request no sooner than 120 days prior to the terminal date of exclusion as specified in the notice of exclusion. Section 402.300(d) explains the request for reinstatement process for an excluded person that had the period of exclusion reduced on appeal. The excluded person must submit a written request and apply for reinstatement within 120 days of the expiration date of the reduced exclusion period.
The burden associated with these requirements is the time and effort necessary to draft and submit the request for reinstatement and to apply for reinstatement. While these requirements do impose burdens, we believe they are exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
Section 402.306(a) explains that if a request for reinstatement is denied, the initiating agency must notify the excluded person in writing. This section also states that within 30 days of the date of the notice of denial, the excluded person may submit to the initiating agency—documentary evidence and a written argument challenging the reinstatement denial; or a written request to present written evidence or oral argument to an official of the initiating agency.
The burden associated with this requirement is the time and effort necessary for the excluded person to provide the aforementioned information. While this requirement imposes burden, we believe it is exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
Section 402.308 discusses the process involved in obtaining a waiver of exclusions. Section 402.308(a) states that persons may request of CMS to present, on their behalf, a request to the Office of the Inspector General (OIG) for Start Printed Page 39752a waiver of the exclusion. The request must be in writing and will only be considered if it meets the criteria listed in this section. If the individual or entity meet the criteria, the written request for a waiver of exclusion must provide, at a minimum, the information listed under § 402.308(b).
The burden associated with this requirement is the time and effort necessary to prepare and submit to CMS the written document requesting a waiver of exclusion. While this requirement imposes burden, we believe it is exempt from the PRA as defined in 5 CFR 1320.4; information collected during the conduct of a criminal investigation or civil action or during the conduct of an administrative action, investigation, or audit involving an agency against specific individuals or entities is not subject to the PRA.
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 in any 1 year). This rule does not reach the economic threshold and thus is not considered a major rule. Any impact that may occur would only affect those limited few persons that engage in prohibited behavior. We do not anticipate any savings or costs as a result of this final 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 small government jurisdictions. 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 rule will not have a significant economic impact on a substantial number of small entities. We believe that any impact as a result of the final rule will be minimal, since the only persons affected would be those limited few who engage in prohibited conduct. Since the vast majority of program participants comply with statutory and regulatory requirements, any aggregate economic impact would not be significant.
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. That threshold is currently approximately $120 million. This rule will have no consequential effect on State, local, or tribal governments, or by the private sector since the majority of program participants comply with statutory and regulatory requirements.
Executive Order 13132 establishes certain requirements that an agency must meet when it publishes a 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.
For the reasons set forth in the preamble, the Centers for Medicare & Medicaid Services amends 42 CFR chapter IV part 402 as set forth below:
2. In § 402.3, add the definition of “initiating agency” in alphabetical order to read:
3. In § 402.105, redesignate paragraph (d)(1)(xix) as paragraph (d)(1)(ix).
4. In part 402, add a new subpart C to read as follows:
Factors considered in determining whether to exclude, and the length of exclusion.
Scope and effect of exclusion.
Response to notice of proposed determination to exclude.
Appeal of exclusion.
Basis for reinstatement.
Approval of request for reinstatement.
Denial of request for reinstatement.
Waivers of exclusions.
§ 402.200
(a) Basis. This subpart is based on the sections of the Act that are specified in § 402.1(e).
(1) Provides for the imposition of an exclusion from the Medicare and Medicaid programs (and, where applicable, other Federal health care programs) against persons that violate the provisions of the Act provided in § 402.1(e) (and further described in § 402.1(c)); and
§ 402.205
The length of exclusion from participation in Medicare, Medicaid, Start Printed Page 39753and, where applicable, other Federal health care programs, is contingent upon the specific violation of the Medicare statute. A full description of the specific violations identified in the sections of the Act are cross-referenced in the regulatory sections listed in the table in paragraph (a) of this section.
Social Security Act paragraph
1833(h)(5)(D) in repeated cases § 402.1(c)(1)
1833(q)(2)(B) in repeated cases § 402.1(c)(3)
1834(a)(11)(A) § 402.1(c)(4)
1834(a)(18)(B) § 402.1(c)(5)
1834(b)(5)(C) § 402.1(c)(6)
1834(c)(4)(C) § 402.1(c)(7)
1834(h)(3) § 402.1(c)(8)
1834(j)(4) § 402.1(c)(10)
1834(k)(6) § 402.1(c)(31)
1834(l)(6) § 402.1(c)(32)
1842(b)(18)(B) § 402.1(c)(11)
1842(k) § 402.1(c)(12)
1842(l)(3) § 402.1(c)(13)
1842(m)(3) § 402.1(c)(14)
1842(n)(3) § 402.1(c)(15)
1842(p)(3)(B) in repeated cases § 402.1(c)(16)
1848(g)(1)(B) in repeated cases § 402.1(c)(17)
1848(g)(3)(B) § 402.1(c)(18)
1848(g)(4)(B)(ii) in repeated cases § 402.1(c)(19)
1879(h) § 402.1(c)(23)
1834(a)(17)(c) for a pattern of contacts § 402.1(e)(2)(i)
1834(h)(3) for a pattern of contacts § 402.1(e)(2)(ii)
1877(g)(5) § 402.1(c)(22)
1882(a)(2) § 402.1(c)(24)
1882(p)(8) § 402.1(c)(25)
1882(p)(9)(C) § 402.1(c)(26)
1882(q)(5)(C) § 402.1(c)(27)
1882(r)(6)(A) § 402.1(c)(28)
1882(s)(4) § 402.1(c)(29)
1882(t)(2) § 402.1(c)(30)
(2) At the expiration of 5 years from the effective date of the exclusion, if the exclusion was imposed for a period of less than 5 years and the initiating agency did not receive the appropriate written request for reinstatement as specified in § 402.300.
§ 402.208
(iii) Whether the person was held liable for criminal, civil, or administrative sanctions in connection with a program covered by this part or any other public or private program of payment for health care items or services at any time before the incident or whether the person presented any claim or made any request for payment that included an item or service subject to a determination under § 402.1.
(vi) The person had a documented mental, emotional, or physical condition before or during the Start Printed Page 39754commission of the noncompliant act(s) and that condition reduces the person's culpability for the acts in question.
(4) Initiating agency authority. Nothing in this section limits the authority of the initiating agency to settle any issue or case as provided by § 402.17, or to compromise any penalty and assessment as provided by § 402.115.
§ 402.209
(7) If a person fails, within the time permitted under § 402.212, to exercise the right to respond to the notice of proposed determination to exclude, the initiating agency may initiate actions for the imposition of the exclusion.
(c) Amendment to the notice of exclusion. No later than 15 days before the final exhibit exchanges required under § 1005.8 of this title, the initiating agency may amend the notice of exclusion if information becomes available that justifies the imposition of a period of exclusion other than the one proposed in the original written notice.
§ 402.212
(a) A person that receives a notice of intent to exclude (that is, the proposed determination) as described in § 402.210, may present to the initiating agency a written response stating whether the proposed exclusion is warranted, and may present additional supportive documentation. The person must submit this response within 60 days of the receipt of notice. The initiating agency reviews the materials presented and initiates a response to the person regarding the argument presented, and any changes to the determination, if appropriate.
(b) The person is also afforded an opportunity to make an oral presentation to the initiating agency concerning whether the proposed Start Printed Page 39755exclusion is warranted and any related matters. The person must submit this request within 30 days of the receipt of notice. Within 15 days of receipt of the person's request, the initiating agency initiates communication with the person to establish a mutually agreed upon time and place for the oral presentation and discussion.
§ 402.214
§ 402.300
(a) An excluded person may submit a written request for reinstatement to the initiating agency no sooner than 120 days prior to the terminal date of exclusion as specified in the notice of exclusion. The written request for reinstatement must include documentation demonstrating that the person has met the standards set forth in § 402.302. Obtaining or reactivating a Medicare provider number (or equivalent) does not constitute reinstatement.
§ 402.302
(d) Reinstatement is not effective until the initiating agency grants the request and provides notices under § 402.304. Reinstatement is effective as provided in the notice.
(e) A determination for a denial of reinstatement is not appealable or reviewable except as provided in § 402.306.
§ 402.304
(b) A determination by the initiating agency to reinstate an excluded person has no effect if Medicare, Medicaid, or, where applicable, any other Federal Start Printed Page 39756health care program has imposed a longer period of exclusion under its own authorities.
§ 402.306
(c) After evaluating any additional evidence submitted by the excluded person (or at the end of the 30-day period described in paragraph (a) of this section, if no documentary evidence or written request is submitted), the initiating agency sends written notice to the excluded person either confirming the denial, or approving the reinstatement in the manner set forth in § 402.304. If the initiating agency elects to uphold its denial decision, the written notice also indicates that a subsequent request for reinstatement will not be considered until at least 1 year after the date of the written denial notice.
§ 402.308
Excluded person has the same meaning as a “person” as defined in § 402.3 who meets for the purposes of this subpart, the definition of the term “exclusion” in § 402.3.
Sole community physician has the same meaning as that term is defined § 1001.2 of this title.
Sole source of essential specialized services in the community has the same meaning as that term defined by the § 1001.2 of this title.
Approved: March 26 2007.
This document was received at the Office of the Federal Register on July 9, 2007.
[FR Doc. E7-13535 Filed 7-19-07; 8:45 am]