Source: https://www.ecfr.gov/cgi-bin/text-idx?mc=true&node=sp42.3.422.l&rgn=div6
Timestamp: 2020-02-21 00:09:42
Document Index: 486380716

Matched Legal Cases: ['art 422', '§422', '§422', 'art 422', '§422', '§422']

Title 42 → Chapter IV → Subchapter B → Part 422 → Subpart L
§422.550 General provisions.
§422.553 Effect of leasing of an MA organization's facilities.
Source: 63 FR 35067, June 26, 1998, unless otherwise noted.
Editorial Note: Nomenclature changes to subpart L of part 422 appear at 63 FR 35106, June 26, 1998.
(a) What constitutes change of ownership—(1) Partnership. The removal, addition, or substitution of a partner, unless the partners expressly agree otherwise as permitted by applicable State law, constitutes a change of ownership.
(2) Asset transfer. Transfer of title and property to another party constitutes change of ownership.
(3) Corporation. (i) The merger of the MA organization's corporation into another corporation or the consolidation of the MA organization with one or more other corporations, resulting in a new corporate body, constitutes a change of ownership.
(ii) Transfer of corporate stock or the merger of another corporation into the MA organization's corporation, with the MA organization surviving, does not ordinarily constitute change of ownership.
(b) Advance notice requirement. (1) An MA organization that has a Medicare contract in effect and is considering or negotiating a change in ownership must notify CMS at least 60 days before the anticipated effective date of the change. The MA organization must also provide updated financial information and a discussion of the financial and solvency impact of the change of ownership on the surviving organization.
(2) If the MA organization fails to give CMS the required notice timely, it continues to be liable for capitation payments that CMS makes to it on behalf of Medicare enrollees after the date of change of ownership.
(c) Novation agreement defined. A novation agreement is an agreement among the current owner of the MA organization, the prospective new owner, and CMS—
(1) That is embodied in a document executed and signed by all three parties;
(2) That meets the requirements of §422.552; and
(3) Under which CMS recognizes the new owner as the successor in interest to the current owner's Medicare contract.
(d) Effect of change of ownership without novation agreement. Except to the extent provided in paragraph (b)(2) of this section, the effect of a change of ownership without a novation agreement is that—
(1) The existing contract becomes invalid; and
(e) Effect of change of ownership with novation agreement. If the MA organization submits a novation agreement that meets the requirements of §422.552, and CMS signs it, the new owner becomes the successor in interest to the current owner's Medicare contract.
[60 FR 45681, Sept. 1, 1995. Redesignated and amended at 63 FR 35067, 35106, June 26, 1998; 63 FR 52614, Oct. 1, 1998; 65 FR 40328, June 29, 2000; 70 FR 4738, Jan. 28, 2005]
(a) General effect of leasing. If an MA organization leases all or part of its facilities to another entity, the other entity does not acquire MA organization status under section 1876 of the Act.
(b) Effect of lease of all facilities. (1) If an MA organization leases all of its facilities to another entity, the contract terminates.
(2) If the other entity wishes to participate in Medicare as an MA organization, it must apply for and enter into a contract in accordance with subpart K of this part.
(c) Effect of partial lease of facilities. If the MA organization leases part of its facilities to another entity, its contract with CMS remains in effect while CMS surveys the MA organization to determine whether it continues to be in compliance with the applicable requirements and qualifying conditions specified in subpart K of this part.
[50 FR 1346, Jan. 10, 1985; 50 FR 20570, May 17, 1985, as amended at 58 FR 38079, July 15, 1993; 60 FR 45681, Sept. 1, 1995. Redesignated and amended at 63 FR 35067, 35106, June 26, 1998; 70 FR 52027, Sept. 1, 2005]