Rule: Medicare: Revisit User Fee Program Medicare Survey and Certification Activities

Wednesday,
September 19, 2007
Part II
Department of
Health and Human
Services
Centers for Medicare & Medicaid Services
42 CFR Parts 424, 488, and 489

Establishment of Revisit User Fee
Program for Medicare Survey and
Certification Activities; Final Rule
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53628 Federal Register / Vol. 72, No. 181 / Wednesday, September 19, 2007 / Rules and Regulations
DEPARTMENT OF HEALTH AND authority for the revisit user fee is Medicare and Medicaid Services, Program
HUMAN SERVICES continued, we will use the current fee Management’ for conducting revisit surveys
schedule in this rule for the assessment on health care facilities cited for deficiencies
Centers for Medicare & Medicaid during initial certification, recertification, or
of such fees until such time as a new fee substantiated complaints surveys. Not
Services schedule notice is proposed and withstanding section 3302 of title 31, United
published in final form. States Code, receipts from such fees shall be
42 CFR Parts 424, 488, and 489 DATES: Effective Date: These regulations credited to such account as offsetting
are effective on September 19, 2007. collections, to remain available until
[CMS–2268–F]
expended for conducting such surveys (Pub.
FOR FURTHER INFORMATION CONTACT: L. 110–5, H.J.Res.20, § 20615(b)(2007)).
RIN 0938–AO96
Carla McGregor, (410) 786–0663
As directed by the Secretary, in the
Establishment of Revisit User Fee SUPPLEMENTARY INFORMATION:
June 29, 2007 Federal Register (72 FR
Program for Medicare Survey and Table of Contents 35673), CMS established revisit user
Certification Activities fees for revisit surveys and put forth in
I. Background
AGENCY: Centers for Medicare & regulation the definitions, criteria for
Medicaid Services (CMS), HHS. A. Overview determining the fee, the fee schedule,
In the June 29, 2007 Federal Register collection of fees, reconsideration
ACTION: Final rule.
(72 FR 35673), we published the process for revisit user fees,
SUMMARY: This final rule will establish proposed rule entitled, ‘‘Establishment enforcement and regulatory language
a system of revisit user fees applicable of Revisit User Fee Program for addressing enrollment and billing
to health care facilities that have been Medicare Survey and Certification privileges, and provider agreements. In
cited for deficiencies during initial Activities’’ and provided for a 60 day the proposed rule, cost projections were
certification, recertification, or comment period. This rule sets forth based on FY 2006 actual data and were
substantiated complaint surveys and final requirements and the final Fee expected to amount to $37.3 million on
require a revisit to confirm that Schedule for providers and suppliers an annual basis. These calculations
corrections to previously-identified who require a revisit survey as a result were included in section IV Regulatory
deficiencies have been remedied. Impact Analysis in the proposed rule
of deficiencies cited during an initial
Consistent with the President’s long- (72 FR 35678).
certification, recertification, or
term goal to promote quality of health The fees will take effect on the date
substantiated complaint survey. of publication of the final rule and will
care and to cut the deficit in half by The Centers for Medicare & Medicaid
fiscal year (FY) 2009, the FY 2007 be in effect until the date that the
Services (CMS) has in place an authority provided by the Congress
Department of Health and Human outcome-oriented survey process that is expires. At the time of publication of
Services’ (HHS) budget request included designed to determine whether existing this regulation the applicable date is
both new mandatory savings proposals Medicare-certified providers and September 30, 2007. As discussed
and a requirement that user fees be suppliers or providers and suppliers thoroughly in the proposed rule, based
applied to health care providers that seeking initial Medicare certification are on the Congress’ knowledge of section
have failed to comply with Federal actually meeting statutory and 1864(e) of the Social Security Act and
quality of care requirements. The regulatory requirements, conditions of already established survey and
‘‘Revisit User Fees’’ will affect only participation, or conditions for certification activities, the unambiguous
those providers or suppliers for which coverage. These health and safety nature of section 20615(b) of the
a revisit is required to confirm that requirements apply to the environments Continuing Resolution, and the
previously-identified failures to meet of care and the delivery of services to principles of lex posterior derogate legi
federal quality of care requirements residents or patients served by these priori or ‘‘last-in-time’’ rule, the
have been remedied. The fees are facilities and agencies. The Secretary of Secretary has the authority to
estimated at $37.3 million annually and the Department of Health and Human implement this revisit user fee and
will recover the costs associated with Services (‘‘HHS’’) has designated CMS establish a final fee schedule. See 72 FR
the Medicare Survey and Certification to enforce the conditions of 35674–35675 (discussing section
program’s revisit surveys. The fees will participation/coverage and other 1864(e) of the Social Security Act).
take effect on the date of publication of requirements with these programs. The
the final rule and will be in effect until revisit user fee will be assessed for II. Summary of the Proposed Provisions
the date that the continued authority revisits conducted in order to determine and Response to Comments
provided by Congress expires. At the whether deficiencies cited as a result of In the June 29, 2007 Federal Register
time of publication of this regulation the carrying out CMS’s survey process (72 FR 35673), we published the
applicable date is September 30, 2007. obligations have been corrected. proposed rule entitled, ‘‘Establishment
If no legislation is enacted, the fees are of Revisit User Fee Program for
not retroactive to the beginning of the B. Requirements for Issuance of
Medicare Survey and Certification
fiscal year. Any provider or supplier Regulations
Activities’’ and provided for a 60 day
that has a revisit survey conducted on Section 20615(b) of The Continuing comment period.
or after the date of publication will be Appropriations Resolution (‘‘Continuing We received a total of 74 comments
assessed a revisit user fee and will be Resolution’’) budget bill passed by the from various providers, suppliers,
notified of the assessment upon data Congress and signed by the President health care associations, and individual
system reconciliation which can occur directed HHS to implement the revisit health care professionals and other
following the closing of the fiscal year. user fees in FY 2007. Section 20615(b) individuals. The comments ranged from
The fees will be available to CMS until states as follows: general support of the survey process or
expended. The revisit user fee is The Secretary of Health and Human general opposition to the proposed
included in the President’s proposed FY Services shall charge fees necessary to cover provisions to very specific questions or
2008 budget. We note through the the costs incurred under ‘Department of comments regarding the proposed new
publication of this final rule that if Health and Human Services, Centers for revisit user fee.
Federal Register / Vol. 72, No. 181 / Wednesday, September 19, 2007 / Rules and Regulations 53629
Brief summaries of each proposed appears that this rule will be void. Other nursing homes may require some
provision, a summary of the public Another commenter disagrees with CMS revisits but with minimal costs because
comments we received and our interpretation of section 1864(e) of the the deficiencies are not serious, and the
responses to the comments are set forth Social Security Act (the Act) as giving revisit may be accomplished through an
below. Comments related to the HHS the ‘‘authority to assess revisit user offsite survey. We have established a
paperwork burden and the impact fees.’’ The commenter felt that clearly much lower fee for offsite surveys since
analyses are addressed in the Collection the inclusion and specific wording in actual costs to the survey program for
of Information and the Regulatory this section within the Act indicates these revisit surveys are much less than
Impact Analysis sections in this Congress intended that the Secretary the costs for onsite surveys, and the user
preamble. ‘‘may not impose’’ any fee on any fee is intended only to recoup average
facility for any survey (revisit or actual costs. We believe we have
General Comments otherwise) for determining compliance designed the user fee program to result
1. Time Period for Levying Fees ‘‘with any requirement of this title.’’ in a positive correlation between quality
Response: We are frequently expected of care and amount of the fees—the
Comment: Several commenters to implement legislation that is better the quality of care, the lower the
suggested that CMS should not allow promulgated by the Congress and fees. We also expect that the prospect of
user fees for nursing home revisits therefore has the force of law, as in the fees for revisits will promote greater
beyond the end of the fiscal year. The passed FY 2007 appropriations bill. We compliance with federal quality of care
commenters believe that nursing homes strive to implement the provisions in an requirements, thereby making for fewer
bear the brunt of the overall survey efficient and effective manner once it revisits and fewer fees over time.
process because surveys are conducted becomes law. The commenter is correct
annually for nursing homes and as such that the current authority to impose the 4. Revisit User Fee Compared to Penalty
CMS should ensure that the fee is not revisit user fee expires for revisits Comment: Several commenters
renewed. occurring after September 30, 2007, believe the revisit user fee constitutes a
Response: The President’s HHS unless otherwise authorized via penalty regardless of whether cited
budget for FY 2007, as enacted by the legislation or through the FY 2008 deficiencies are appealed and
Congress, directs the HHS Secretary to appropriations bill, as examples. The overturned. They also stated that the
implement the revisit user fees during revisit user fee is included in the revisit user fee imposed additional
FY 2007. Since the provisions for the President’s proposed FY 2008 budget. penalties that may be assessed.
revisit user fee were put forth through We acknowledge the commenter’s Response: The revisit user fee does
the annual appropriations process, disagreement with the Congress’ intent have some similarities to a quality of
continuation of the fees under this as it relates to authority to impose any care penalty in so far as the revisit user
regulation beyond September 30, 2007 fee based on the Social Security Act. fee only applies to providers or
will depend on Congressional renewal However, as we discussed in the suppliers for which deficiencies have
or extension of the time period under Proposed Rule, we believe that Congress been identified. There are differences,
which fees may be assessed. While intended to give the Secretary authority however, between the revisit user fee
nursing homes have the most frequent to implement this revisit user fee and traditional penalties. For example,
surveys, they also have the largest program when Congress enacted section a traditional penalty, such as a civil
number of revisits. Revisits in nursing 20615(b) of the Continuing Resolution. monetary penalty, is assessed according
homes represent the largest single to the scope and severity of individual
source revisit costs. While there would 3. ‘‘Good Performers Versus Poor deficiencies that have been identified. A
be cost to some—but not all—nursing Performers’’ penalty amount would be independent
homes as a result of the revisit fees, Comment: Several commenters of the cost for the time required by
nursing homes also benefit from being believed that those nursing homes surveyors to revisit the provider in order
able to reassure prospective nursing considered to be providing excellent to confirm that corrections have been
home residents and their families that care would be required to pay a revisit made. In contrast, the revisit user fee is
the nursing home is federally certified user fee along with nursing homes that designed only to replace the average
and that there is an objective and are considered poor performers. The actual cost associated with the revisits
independent system of oversight to commenters believe that even minor themselves. Second, currently only
assure quality. The revisit survey is an infractions uncovered during an annual nursing homes are subject to civil
essential element of that quality survey for these higher quality nursing monetary penalties; no other Medicare-
assurance system. We also note that the homes would still lead to the imposition certified providers or suppliers affected
revisit fees are not restricted to nursing of a revisit user fee. A commenter by this regulation are subject to CMS
homes, but apply to almost all providers questioned whether or not those CMPs for quality of care deficiencies at
and suppliers that require a revisit to facilities going above and beyond to this time. Among nursing homes, only
confirm that identified deficiencies are provide higher level care through higher approximately 12 percent of nursing
remedied. costs of operations should be subjected homes are levied a CMP in any
to this user fee in the same manner as particular year, on average. If a revisit
2. Authority to Assess a Revisit User Fee those facilities that are performing at the survey is required, a user fee will be
Comment: A few commenters bare minimum requirements with lower assessed; however this does not
expressed concern that revisit fees costs of operations if the goal is to necessarily mean a CMP will be levied
would be imposed when the authority promote a better health care as well.
granted to levy fees expires on environment.
September 30, 2007 and that there does Response: We believe that many 5. Revisit User Fee Compared to Taxes
not appear to be legislation pending that nursing homes will pay no revisit user Comment: One commenter stated that
would extend CMS’ authority to impose fees because they consistently provide the revisit user fee amounted to a new
these fees beyond FY 2007. One high quality care, have no deficiencies tax. Another commenter felt that the
commenter stated that if the Congress identified through the survey process, revisit user fee was an example of
does not extend this authority, then it and therefore will require no revisits. extortion and that the funding to
administer the survey process including certainty that a revisit will occur is a from becoming a serious reality. First,
revisits is already in place. They substantial incentive for a provider to the revisit user fees will be collected
equated this fee to have the same effect make the necessary corrections; nationally by CMS through a contractor
as if the IRS was to impose a fee when therefore, we believe that this quality rather than by individual States. CMS
the individual’s tax return is flagged for assurance function will improve care makes allocations to States based on the
an audit. A commenter felt the fee and safety for Medicare beneficiaries. In effects of inflation and on overall survey
would amount to financial impropriety addition, we believe the imposition of and certification workload and
on the part of the government. revisit user fees will likely encourage a performance for all survey and
Response: We believe that the sustained commitment to management certification functions, with revisits
commenter’s characterization of the systems that improve quality of care comprising just one of many functions.
revisit user fee as a ‘‘tax’’ is not provided to all clients served by the The national survey and certification
accurate. Taxes are typically imposed provider. CMS does not believe that the budget may not exceed the level
regardless of whether the taxed parties revisit user fee should harm quality of established by Congress, regardless of
actually use the services that the tax care provided, but can instead become the level of revisit fee collections.
makes possible. Taxes must be paid a valuable, additional incentive to Second, all States must conduct revisits
regardless of the extent of government encourage providers and suppliers to according to policies and procedures
services that are accessed. In contrast, commit to sustained compliance with established by CMS. Those policies and
the revisit user fee will be levied only federal quality of care requirements. The procedures are publicly available in
for those who fail to comply fully with quality of care message is that providers CMS’ State Operations Manual (SOM)
their responsibilities to provide quality and suppliers will have no user fees and in numbered Survey &
care and to abide by federal quality of when quality of care meets the Certifications policy memoranda
care and related requirements under the appropriate federal standards. To the published on the CMS Web site. Such
Medicare Provider Agreement and extent that there are deficiencies, policies and procedures define the
applicable regulations and laws for providers and suppliers will have only circumstances under which revisit
providers and suppliers. Such failure small fees to the extent that the surveys, both onsite and offsite, occur
obliges CMS to incur revisit survey costs deficiencies are not serious or and when they do not occur. CMS
that would not otherwise have been widespread. If quality problems do
Regional Offices monitor State
incurred. The revisit user fee amount is occur, providers and suppliers will have
implementation of the policies and
calibrated to match the additional greater incentives to ensure that quality
resources required, on average, for the procedures. We intend to increase CMS
lapses are corrected more quickly than
surveyors to verify compliance with monitoring for revisits. Third, States
in the past, since the revisit fees will be
known federal requirements subsequent incur substantial costs in order to
less if only one revisit is required.
to the provider’s or supplier’s initial conduct revisits. Such costs are not
failure to meet those requirements fully. 7. State Practices and Incentives for lightly undertaken, since there are
Revisits formidable natural and governmental
6. Effects on Resident or Patient Care Comment: Several commenters constraints on a State survey agency’s
Comment: Several commenters raised expressed a concern that State survey ability to make use of any added funds
concern that the assessment and teams would be instructed to find more that might conceivably become available
payment of the user fee would remove violations if a revisit user fee were in even if there were a direct fiscal
several thousand dollars per facility that place, thus increasing the number of connection between revisits and the
otherwise would be available for revisit surveys. One commenter also amount of money the State survey
resident care. Another commenter felt raised the concern that the facility will agency were to receive. The single
the ethics of this proposal would have to pay a revisit user fee for a revisit largest cost to a State survey agency, for
adversely affect the citizens of a State. survey although the State may not example, is personnel. The ability of a
The commenter felt that the revisit user consider the deficiency severe. Another State survey agency to hire new staff
fee was unfair. Other commenters commenter raised concern that there (even when new revenue becomes
stated, in various ways, that the revisit would be tremendous potential for available) is either very limited or there
user fee would remove valuable abuse, that surveyors lacked experience is a long delay between the availability
resources that would otherwise be and that there existed too much of such funds and the hiring of a
expended for patient and employee financial control of the facilities in the surveyor. Once hired, the surveyor must
resources. They felt that a direct hand of the state surveyors. This typically undergo about six months of
drawdown from funds used for patient commenter also expressed concern as to training and observing before being
care would occur, resulting in no whether there would be adequate entrusted to conduct surveys. These
improvement to the quality of resident monitoring of State agencies for constraints make it unlikely that a State
care. Finally, they felt that there would potential abuse of this program. Two survey agency would incur the upfront
be a direct adverse fiscal impact on commenters believed the fee would staffing costs of conducting revisits that
smaller more financially challenged increase the number of revisits currently were not required, or would seek to
facilities. being done, putting an extra burden on identify more deficiencies simply to
Response: CMS believes the providers staff as well as required additional time justify a revisit and hope that at some
and suppliers are the controlling agents for State surveyors. One commenter felt vague future date the added costs might
in managing the quality of care of that the nursing home revisits would be recognized by CMS. To the extent
services provided in their healthcare increase to 100 percent because of what that the revisit user fee does create any
facilities. Providers and suppliers may they consider a financial incentive. type of new incentive, we expect that
avoid revisit fees by ensuring sustained Response: We agree that any potential the main incentive will be for providers
compliance with federal quality of care conflict of interest, and any appearance and suppliers to maintain compliance
requirements. The revisit user fees of conflict of interest, must be addressed with federal quality of care and safety
simply compensate for the costs of in the design and operation of any user requirements, since such compliance
confirming that previously-identified fee program. A number of safeguards offers a clear pathway to the avoidance
problems have been remedied. The will prevent any such potential conflict of revisit fees.
Comment: One commenter stated that government, and or the State Health user fee, we believe that those admirable
the proposed rule would increase fees Departments. The government has goals go beyond Congress’ intended
for facilities that had follow-up for mandated these surveys and as such the purpose of the revisit user fee program.
routine licensure/certification surveys quality assurance checks are its
Part 424—Conditions for Medicare
as well as complaint visits. obligation. One commenter felt that the
Response: Revisit user fees will apply Payment
Federal government’s role is to raise
only to surveys that occur after an initial these funds, as been often done through Subpart P—Requirements for
certification, recertification, or Federal taxes, although not advocating a Establishing and Maintaining Medicare
substantiated complaint survey has Federal tax increase, it is through these Billing Privileges
identified deficiencies. State licensures like efforts the commenter suggested Section 424.535 Revocation of
issues that a State survey agency might that funds should be derived to pay for Enrollment and Billing Privileges in the
address during a survey or a revisit the survey process. Medicare Program
survey are separate activities not Response: The revisit user fee is
connected with the assessment of a designed simply to pay for actual costs We proposed to amend § 424.535(a)(1)
revisit user fee. Surveyor time spent on of conducting revisits, on average, rather by adding a new sentence to the criteria
State-only issues must also be cost- than as a revenue generating instrument for which a provider or supplier may be
accounted for by State survey agencies that might be unconnected with the determined not in compliance and for
to ensure that such costs are not billed government activity for which the which we may revoke enrollment and
to the federal government. Thus, a revisit user fee is assessed. In addition, billing privileges in the Medicare
survey or revisit survey based solely on the revisit user fees offer the ancillary program. We proposed to add that the
State licensure requirements would not benefit of encouraging providers and provider or supplier may also be
create the assessment of a revisit user suppliers to commit to sustained determined not to be in compliance if it
fee. Only the need to conduct revisit compliance with Federal quality of care has failed to pay any user fees as
surveys regarding Federal conditions of requirements and ensure that quality assessed under part 488 of this chapter.
participation, requirements, or lapses are remedied quickly. The paragraph will continue to read that
conditions for coverage would trigger a all providers and suppliers are granted
9. Creating Positive Incentives an opportunity to correct the deficient
revisit user fee.
Comment: One commenter observed Comment: Although some compliance requirement before a final
that State and federal regulations commenters felt the revisit user fee was determination to revoke billing
require nursing facilities to report punitive in nature and not proactive, privileges occurs.
allegations of abuse and other issues to several commenters did support added Comment: Some commenters tied in
the State survey agency. The commenter incentives to increase patient and the discussion of revocation of billing
expressed concern that such mandatory resident safety, quality of care, and and the termination for nonpayment as
reports will result in a visit from the compliance to standards. A couple of proposed in § 488.30(f) and
Survey Agency inspectors, usually commenters went on to state that a § 489.53(a)(16). One commenter felt that
without any finding of regulatory positive incentive would serve to termination for nonpayment within 30
deficiencies. The financial impact of the strengthen the relationship between days is power disproportionate to the
proposal could be very burdensome for regulators and providers and would offense and is unrelated to quality of
many nursing facilities. establish CMS as a partner rather than care and safety issues. Another
Response: An initial visit to an adversary of the long-term care commenter felt that this provision is
investigate a complaint, such as the community. A few commenters reason not to participate in Medicare, or
allegation of abuse and or neglect indicated strong support of the to care for Medicare patients.
mentioned by the commenter would not Medicare survey process as one method Response: While we proposed that a
trigger a revisit user fee. A revisit would to assure only providers and suppliers provider or supplier may also be
be required only if a deficiency is that offer high quality services determined not to be in compliance if a
identified as a result of that complaint participate in the Medicare program. revisit user fee payment has not been
investigation. The user fee would not One commenter went as far as offering received within 30 calendar days after
apply to the initial complaint three goals for which the collected user receipt of the notice that payment is
investigation; it would apply only to the fees should be directed, which included due, we also state at § 424.535(a)(1) that
revisit once the provider has alleged to improving consistency of the survey all providers and suppliers are granted
the State survey agency that it has process, ensuring complete, provider- an opportunity to correct the deficient
addressed the deficiency identified in specific training for surveyors, and payment compliance before a final
the original complaint investigation. improving communication between determination is made to revoke billing
Complaint investigations that find no State survey agencies and the provider privileges. We further note that a
deficiencies will not require any revisits community on survey rules and payment-due notice from CMS is
and will therefore not occasion any expectations. This commenter went on preceded by a survey or complaint
revisit fees. to state that fees derived for these investigation that has found
survey program improvements should deficiencies, a correction period
8. Revenue Seeking—Government not be used to merely supplant the afforded to the provider or supplier, a
Responsible for Funding Survey Process normal funding stream but dedicated to revisit to confirm compliance, then a
Comments: Several commenters felt specific programs. later issuance of the payment-due
that this proposed rule and the Response: The intent of the revisit notice, followed by the formal 30-day
assessment of revisit user fees was a user fee program is to recover the costs advance notice to the provider. As soon
revenue seeking mechanism, that it was associated with conducting follow-up as a revisit occurs, each provider or
a way to fund and pay for the survey visits for deficiencies cited during supplier will know that a revisit user fee
process. Many of these same initial certification, recertification, and will follow at a later date, will know the
commenters felt that the obligation of substantiated complaint surveys. amount of the fee due from the fee
the survey process and the conducting Although the commenter offers three schedule published in this rule, and
of revisit surveys was that of the Federal additional goals for the collected revisit will know that the payment will be due
within 30 calendar days. While the rule to allow more timely surveys that now would affect the health and safety of patients
specifies that enforcement action may are delayed due to CMS budget, staff and raises doubts as to a provider’s or
occur if the bill has not been paid shortages, and other priorities. supplier’s noncompliance with any Medicare
Response: Both commenters are condition. (42 CFR § 488.1)
within 30 calendar days, the total
amount of planning time available to the referring to the issue of initial We further noted that the Continuing
provider or supplier will have totaled certification surveys conducted for new Resolution included the term
much more than the 30 calendar day providers or suppliers, rather than the ‘‘substantiated complaints surveys.’’ We
period before any enforcement action revisit surveys themselves. proposed that ‘‘substantiated complaint
may occur. Finally, the revocation of While we appreciate the suggestion survey’’ means a complaint survey that
billing and enrollment privileges is not from one commenter that CMS charge a results in the proof or finding of
an immediate action upon the failure of fee for initial surveys so as to eliminate noncompliance at the time of the
a provider or supplier to remit the the current backlog of unsurveyed and survey, a finding that noncompliance
assessed revisit user fee. In this final uncertified potential Medicare was proven to exist, but was corrected
rule we therefore retain the time frames providers, we are neither authorized by prior to the survey, and includes any
for which action will occur regarding Congress nor prepared to charge such deficiency that is cited during a
this process and retain the amended fees at this time. complaint survey, whether or not the
language to § 424.535(a)(1) as final. We also do not accept the suggestion deficiency was the original subject of
from the other commenter that home the substantial allegation of
Part 488—Survey, Certification, and health agencies and hospices simply be noncompliance.
Enforcement exempt from initial certification due to We proposed that a user fee would be
Subpart A—General Provisions the survey backlog. We are not assessed for revisit surveys conducted to
authorized to make such exemption. We evaluate the extent to which
Section 488.30 Revisit User Fee for also believe an exemption would be deficiencies identified during a
Revisit Surveys inadvisable, as it would permit those substantiated complaint survey have
We proposed a new § 488.30 which providers to begin to serve Medicare been corrected.
set forth proposed regulations that beneficiaries without any assurance that Comment: Commenters requested
identifies the circumstances under they meet quality of care and safety clarification on the term ‘‘substantial
which providers or suppliers be requirements. The proliferation of new allegation of noncompliance,’’ and felt
assessed a user fee for revisit surveys home health and hospices in a few that the definition as a basis for the
connected with deficiencies identified States have also given rise to revisit fee is vague and open-ended.
during surveys for initial certification, considerable concerns of fraud, a Response: CMS proposed the
recertification, or substantiated concern that CMS is responding to definition for ‘‘complaint surveys’’ to
complaints. This proposed paragraph through various anti-fraud initiatives mean those surveys conducted on the
identifies the assessment of fees, criteria recently announced by the Secretary. basis of a substantial allegation of
for which the proposed fee schedule We do expect that the revisit user fee noncompliance, as defined in § 488.1.
will be based, and collection of fees. will indirectly help to resolve the ‘‘Substantial allegation of
problem of surveying and certifying new noncompliance’’ has been the term used
Section 488.30(a)—Definitions in current survey, certification, and
providers. Revisit costs represent a
We proposed in § 488.30(a) to define minority but still substantial portion of enforcement procedures and as such we
terms associated with this paragraph. overall survey and certification intended to maintain a level of
Those terms included: ‘‘certification,’’ expenses. By defraying such costs consistency by utilizing this definition
‘‘complaint surveys,’’ ‘‘substantiated through the user fees, the States will as a means to define ‘‘complaint
complaint survey,’’ ‘‘provider of then be in a better position to conduct surveys.’’ It is this process that generates
services,’’ ‘‘provider,’’ ‘‘supplier,’’ and tier III and tier IV priority work, and the action for which an investigation
‘‘revisit survey.’’ Many of the comments will be able to conduct more initial into the complaint should occur. It is
received for § 488.30(a) dealt less with surveys than they have been able to the substantiation of this complaint
the wording in the definitions and more conduct recently. survey that will determine if a revisit
with the survey and certification While we appreciate the comments, to survey should be conducted and as a
activities and its process. adhere to the Congress intent within the result a revisit user fee should be
Continuing Resolution, we will not assessed. As we provided in the
Certification (Initial or Recertification) discussion of the proposed rule
assess a fee for initial certification, nor
We proposed that ‘‘certification’’ at this time can we remove providers or ‘‘substantiated complaint survey’’
(both initial and recertification) would suppliers based on when initial means a complaint survey that results in
include those activities as defined in certifications are conducted. We will (1) the proof or finding of
§ 488.1. ‘‘Certification’’ as currently retain the proposed definition of noncompliance at the time of the
defined in § 488.1 is a ‘‘recommendation ‘‘certification’’ as final. survey, (2) a finding that noncompliance
made by the State survey agency on the was proven to exist, but was corrected
compliance of providers and suppliers ‘‘Complaint Surveys’’ prior to the survey, and (3) includes any
with the conditions of participation, We proposed that complaint surveys deficiency that is cited during a
requirements (SNFs and NFs), and are those surveys conducted on the complaint survey, whether or not the
conditions for coverage.’’ basis of a ‘‘substantial allegation of deficiency was the original subject of
Comment: One commenter proposed noncompliance,’’ as defined in § 488.1. the substantial allegation of
that home health agencies and hospice The term ‘‘substantial allegation of noncompliance. If any of these 3
facilities be removed from initial noncompliance’’ means: situations are determined and a revisit
certifications since it can take 2 or more is required as a result of the situation,

A complaint from any of a variety of
years to get initial certifications. sources (including complaints submitted in then a revisit user fee will be assessed.
Another commenter proposed that the person, by telephone, through written It will not simply be based on whether
revisit user fee should be expanded to correspondence, or in newspaper or the complaint was substantiated. A
include initial surveys of ESRD facilities magazine articles) that if substantiated, complaint may be substantiated without
being determined to be non-compliant revisit user fee in this instance and this deficiency. As a continued part of the
with the regulations. The substantiation would discourage a facility’s internal survey and certification process a
of a complaint is a separate issue from quality assurance. A commenter raised complaint may be substantiated without
the determination of compliance with the questions as to whether a being determined to be non-compliant
the regulations and thus the triggering of substantiated complaint included with the regulations. The substantiation
a revisit user fee. condition and standard levels or just of a complaint is a separate issue from
Comment: One commenter contends condition level. This commenter the determination of compliance with
that accepting complaints from a variety proposes that it just include condition the regulations and thus the triggering of
of sources is overly broad and permits level since those levels result in non- a revisit user fee.
the process to go forward at great length. certification or decertification. We appreciate the comments,
Another commenter felt that there is Response: CMS published condition however to adhere to consistency across
nothing to prevent disgruntled of participation, condition for coverage current survey and certification policy,
employees from submitting complaints and other regulatory requirements we will retain the definition of
anonymously, especially once they typically take the form of specific ‘‘complaint surveys’’ to mean those
learn that the user fee will punish the standards, with multiple standards surveys conducted as the basis of a
facility. Commenters felt that this related to a common topic comprising a substantial allegation of noncompliance,
provides incentive for surveyors to broader ‘‘condition.’’ Revisit surveys are as defined in § 488.1 as final.
substantiate the compliant that triggered almost always required for condition-
‘‘Provider of Services, Provider, or
the revisit or substantiate another level deficiencies and are also often
Supplier’’
deficiency. required for standard-level deficiencies,
Response: We do not expect that depending on the extent and We proposed to retain the terms
either the quantity of complaints seriousness of the noncompliance ‘‘provider of services,’’ ‘‘provider,’’ or
received or the source of the complaints identified. As we provided in the ‘‘supplier’’ as defined in § 488.1. We
will affect revisit user fees to any discussion of the proposed rule, proposed that all ‘‘provider of services,’’
measurable extent. The revisit user fee ‘‘substantiated complaint survey’’ ‘‘providers,’’ or ‘‘suppliers,’’ as defined
does not apply to any complaint means a complaint survey that results in in § 488.1, will be subject to user fees,
investigation. Only complaints which (1) the proof or finding of unless otherwise exempted through the
have been substantiated as showing noncompliance at the time of the final rule. We proposed that a ‘‘provider
non-compliance with Federal survey, (2) a finding that noncompliance of services’’ or ‘‘provider’’ that may be
requirements will result in citation of a was proven to exist, but was corrected assessed a user fee, as it applies in this
deficiency. Only those deficiencies that prior to the survey, and (3) includes any proposed rule, includes a hospital,
require a revisit survey will then trigger deficiency that is cited during a critical access hospital, skilled nursing
a revisit user fee. When multiple complaint survey, whether or not the facility, dually-participating nursing
complaints are received near the same deficiency was the original subject of facility (‘‘SNF/NF’’), home health
point in time, State survey agencies the substantial allegation of agency (‘‘HHA’’), and hospice.
typically bundle those together in one noncompliance. If any of these 3 Transplant centers would also be
complaint investigation, this situations are determined and a revisit subject to user fees and have been
investigation is followed by a revisit is required as a result of the situation defined in § 482.70 of this chapter. We
survey only if one or more of the then a revisit user fee is assessed. proposed that ‘‘providers of services’’ or
complaints is substantiated and the Although we disagree in part with the ‘‘providers’’ that will not be assessed a
agency finds noncompliance to such an commenter who indicated that any revisit user fee as defined in the
extent that a revisit is called for deficiency can not be cited during a proposed rule to be comprehensive
according to CMS policy. Finally, the complaint survey, we reiterate and outpatient rehabilitation facilities,
volume of complaints reaching CMS are clarify that under our current policy for transplant centers, and providers of
to some extent affected by the extent conducting complaint surveys, we do outpatient physical therapy or speech
that the provider or supplier has an require that if a State surveyor in the pathology services. These providers are
effective system of inviting complaints course of conducting the complaint excluded from this rule because they are
internally, and responding to survey observes a situation that not subject to a routine survey process
complaints effectively such that warrants further investigation, that the as are other service providers. We stated
beneficiaries or their families feel that State must seek input from the CMS that Medicaid-only ‘‘providers of
there is less need to file complaints with regional office to request permission to services’’ or ‘‘providers’’ will not be
CMS or any external party. We believe further pursue this additional situation. assessed a user fee.
that beneficiary complaints represent a See U.S. Centers for Medicare & We proposed a ‘‘supplier’’ that may be
very important source of feedback for Medicaid Services. State Operations assessed a user fee, as it applies in the
providers, suppliers, CMS and States. Manual, ‘‘Complaint Procedures.’’ proposed rule includes an end-stage
We hope such feedback can be ONLINE. 2006. CMS. Available: http:// renal disease center, a rural health clinic
effectively used by us and others to www.cms.hhs.gov/manuals/downloads/ (‘‘RHC’’), and an ambulatory surgical
identify areas of health care that merit som107c05.pdf (‘‘SOM-Complaint’’). center (‘‘ASC’’). ASCs must have an
serious attention. With regard to the two commenters’’ agreement with CMS to participate in
Comment: One commenter disagreed concern that a finding that Medicare and must meet conditions for
that a ‘‘substantiated complaint survey’’ noncompliance was proven to exist, but coverage as defined in Part 416 of this
can cite any deficiency regardless of was corrected prior to the survey, this chapter.
whether that deficiency was the original situation alone would not trigger a ‘‘Suppliers’’ that would not be
subject of the complaint. Two revisit user fee. In addition, because a assessed a user fee under the proposed
commenters raised concerns that a substantiated complaint survey can rule are independent laboratories,
revisit user fee will be imposed even in include the above criteria we do not portable x-ray centers, physical
cases where a ‘‘substantiated believe at this time that we should make therapists in independent practice,
complaint’’ is corrected prior to the a distinction between a condition level Federally Qualified Health Centers
survey or that CMS would require a deficiency and a standard level (FQHCs), and chiropractors. These
suppliers are excluded because they are for providers to adjust to the new rules compliance with Federal health, safety,
not subject to a routine survey process before they are affected by surveys and and quality standards.
as are other suppliers. We stated that the later revisits that might follow some We received only a few comments
Medicaid-only ‘‘suppliers’’ will not be surveys. Finally, although we appreciate regarding the term ‘‘revisit surveys’’ and
assessed a user fee. the commenter’s suggestion, we do not received the majority of comments
The proposed rule would not interfere have the discretion at this time to under this section reflecting
with user fees associated with clinical exclude ESRD facilities from this final commenters concern regarding the
laboratories as established by the rule. ESRD facilities and revisits costs survey process and the manner in which
Congress, which passed the Clinical were included within the President’s revisit user fees will be assessed.
Laboratory Improvement Amendments budget projections and mandated by the 1. ‘‘Revisit Survey’’ Term
(CLIA) in 1988 and established that Congress.
outpatient clinical laboratory services Comment: One commenter expressed Comment: Several commenters
are paid based on a fee schedule in concern that religious nonmedical requested that we redefine the term
accordance with section 1833(h) of the health care institutions (RHNCIs) would ‘‘revisit survey’’ so that the definition
Act. be subject to the revisit user fees. does not include desk reviews or offsite
We received several comments Response: We appreciate the surveys, that the offsite (desk) reviews
regarding our definition of ‘‘provider of comment received. We inadvertently be defined, that fees only be imposed if
services,’’ ‘‘provider,’’ or ‘‘supplier’’ and did not include religious nonmedical the survey is done in accordance with
we have included them below. health care institutions (RHNCIs) in the already established policies per
Comment: One commenter indicated definitions. RHNCIs should have been provider type, that the definition
that Chiropractors status among the included, as they are subject to the include criteria about when onsite
Allied Health Care professions remains survey and certification process. To revisits are required, and that we limit
in dispute, this commenter contends adhere to the intent of the Congress and the fees to ‘‘onsite revisit surveys.’’
that Chiropractors should be excluded maintain consistency of definitions Response: We included offsite revisit
from any Medicare provider list. across Medicare and Medicaid surveys (desk reviews) because we
Response: Our current regulations programs, we will retain the definitions wished to retain the option of the offsite
found in § 488.1 include Chiropractors as proposed with the exception that we revisit surveys where warranted, since
as identified as a supplier. This will include RHNCIs in the definition. the cost to providers and suppliers
particular definition section also has However, in the fee schedule in this under the revisit fee program will be
extensive implications in various parts final rule we exempt them from the user substantially less than for onsite revisit
of the Medicare and Medicaid program fee program due to the very small surveys. The function of onsite and
and although we appreciate the number of such facilities and their offsite (desk review) revisit surveys is
commenter’s concern, we do not relatively unusual nature. Any change the same. We interpret both types to
propose to remove chiropractors from to the exemption status would be constitute revisits within the meaning
the definition of supplier. We do preceded by publication of a Federal intended by Congress. The Continuing
reiterate that Chiropractors are not Register notice. The final definition of Resolution requires fees to be assessed
subject to the revisit user fees. ‘‘provider of services,’’ ‘‘provider,’’ or that are necessary to cover the costs
Comment: One commenter believed ‘‘supplier’’ will read ‘‘Provider of incurred for conducting revisit surveys
that the implementation of this rule services, provider, or supplier’’ as on health care facilities cited for
should not coincide with the defined in § 488.1, and ambulatory deficiencies found during initial
publication of the final rule for ESRD surgical centers, transplant centers, and certification, recertification, or
conditions of coverage. This commenter religious nonmedical health care substantiated complaint surveys. As we
felt that revisits and assignment of fees institutions subject to § 416.2, § 482.70, observed, we do not interpret this to
could very well be excessive during the and § 403.702 of this chapter, mean onsite revisit surveys only. Within
‘‘learning curve’’ of the new regulation; respectively, will be subject to user fees the current survey process itself there
if CMS has such discretion the unless otherwise exempted. are distinctions made for when an
commenter suggests that this final rule onsite or offsite revisit survey should
should state that revisit user fees for ‘‘Revisit Survey’’ occur and distinctions are made by
ESRD facilities will not apply for the In the Proposed Rule CMS defined the provider and supplier type. See U.S.
first 12 months of implementation of term ‘‘revisit survey’’ to mean a survey Centers for Medicare & Medicaid
new conditions for coverage. performed with respect to a provider or Services. State Operations Manual,
Response: The commenter is referring supplier cited for deficiencies during an ‘‘Survey and Enforcement Process for
to the future publication of the final initial certification, recertification, or Skilled Nursing Facilities and Nursing
CMS rule revising the Conditions for substantiated complaint survey and Facilities,’’ Online. 2004. CMS.
Coverage for end stage renal disease which is designed to evaluate the extent Available: http://www.cms.hhs.gov/
facilities (ESRD). New rules or to which previously cited deficiencies manuals/downloads/som107c07.pdf,
substantial revisions of new rules are have been corrected. We further and also ‘‘Additional Program
typically promulgated with future proposed that for purpose of this rule Activities,’’ Online. 2007. CMS.
effective dates. Considerable revisit surveys include both offsite and Available: http://www.cms.hhs.gov/
educational communications usually onsite. We also reiterated that manuals/downloads/som107c03.pdf.
precede the effective date, during which regulations established in § 488.26 of We disagree that revisit surveys
providers or suppliers have an this same part provided regulatory should only be those that were
opportunity to become familiar with the requirements for conditions of conducted onsite, as there are situations
rule and make necessary changes before participation, conditions for coverage, in which offsite reviews are required to
the survey process holds them or other regulatory requirements. verify that the contents of the plan of
accountable. Currently, ESRD surveys Specifically § 488.26 of this part states correction or the corrective action took
are conducted about once every three to that the compliance determination is place. We do, however, agree that a
five years. We therefore believe that made by the State survey agency and review of a plan of correction that does
there will be reasonable opportunities includes a survey process that assesses not require verification beyond the plan
of correction document itself would not that the proposed rule will complicate the survey process can be inherently
constitute an offsite revisit survey (as the subjectivity and variability that will stressful for employees. We do not
defined here), and thus the provider or always be part of the survey process. believe, however, that the amount of the
supplier would not be assessed a revisit Another commenter indicated that the revisit fee is so much as to add
user fee in such a circumstance. A survey process is broken and subjective, measurably to the pre-existing stress
provider or supplier will be assessed a and as such, fees for revisits would be level for employees. The cost of a revisit
revisit user fee for an offsite revisit unfair until those problems are resolved. fee can be compared favorably to the
survey if the deficiency or deficiencies Response: CMS continuously works larger cost to beneficiaries from poor
cited are of a nature that the content of with States to ensure that surveys are quality of care, or to the larger financial
the plan of correction and the applied as consistently as possible. CMS cost to providers from serious non-
statements made by the provider or also operates a national internal compliance with federal requirements,
supplier require verification and offsite consistency program in which such as civil monetary penalties or
follow-up to ensure that the corrective validation surveys are conducted by termination of the provider agreement.
action has brought the provider back Federal surveyors to promote optimum Only in the case of multiple revisits
into compliance with federal consistency. For example, Federal would we expect the cumulative cost of
requirements. surveyors conduct validation surveys on revisits fees to become a significant
We appreciate the comments a 5% sample of nursing home surveys expense for a particular provider. A
received; however on the term ‘‘revisit to check the accuracy and adequacy of large number of revisits would occur
survey,’’ based on our discussion we State surveys. CMS then works with the when there is a persistent pattern of
will retain the proposed definition of States to adjust for any significant poor quality and documented inability
‘‘revisit survey’’ as final. disparities. The issue of consistency is of a provider or supplier to sustain
also monitored as part of CMS’s review compliance with federal requirements.
2. Survey Process
of State performance. Because no system Such providers face more serious
CMS discussed the current revisit is perfect, nursing homes have an consequences than revisit user fees. We
policy and survey and certification opportunity to request review of any believe that the plain language of the
process already established for all cited deficiency through a structured Continuing Resolution mandates that a
providers and suppliers. We identified informal dispute resolution process. fee be collected whenever a revisit
current policy for skilled nursing CMS takes the issue of consistency occurs as a result of a deficiency found
facilities and dually-participating seriously, and we continue to develop during initial certification,
nursing facilities, performed at the additional methods to analyze and recertification, or substantiated
discretion of CMS or the State. This address consistency issues, one example complaint surveys. Documentation
revisit policy indicates circumstances is the new Quality Indicator Survey requirements supporting deficiency
for which onsite revisits must occur for (QIS) process that has been pilot-tested citations are not being diminished,
certifying compliance and in five States. The QIS process utilizes eliminated or otherwise changed by this
circumstances when onsite revisits are customized software and is designed as proposed rule to create the scenario
discretionary. Likewise, CMS generally a staged process for use by surveyors to raised by the commenter.
permits only two revisits for hospitals, systematically review requirements and Comment: One commenter proposed
home health agencies, hospices, objectively investigate all triggered that onsite revisits be discretionary for
ambulatory surgical centers, rural health regulatory areas in an effort to meet single ‘‘G’’ level deficiencies. Another
clinics, and end-stage renal disease several objectives, one of which is to commenter indicated that it is unclear
centers. Of these two revisits permitted improve consistency and accuracy of what level deficiency would necessitate
by CMS, one revisit should occur within quality of care and quality of life a revisit. A few commenters believed
45 calendar days of the initial problem identification. We believe that that oversight of correction of some
certification, recertification, or the revisit user fee will help address deficiencies could be done offsite and
substantiated complaint survey, and one those limitations and make more requested clarification about when
revisit subject to CMS approval, feasible a number of additional onsite revisits are required.
between the 46th and 90th calendar consistency improvements that are Response: Our current policy requires
days. See 72 FR 35676 (discussing underway. onsite revisits for condition level
revisit policy, including discussion on Comment: One commenter feared that citations. The current policy governing
revisits related to Immediate Jeopardy). there are no constraints to prevent a revisit surveys is described in our
surveyor from citing an already online state operations manual. We will,
2A. Survey Process: Skilled Nursing
corrected problem in order to trigger a however, consider policy issues raised
Facilities and Dually-Participating
revisit. One commenter believed that by several of the commenters for future
Nursing Facilities the survey process is already stressful reconsideration. Some professional
Comment: Several commenters for facility staff and this will only be discretion on the part of State survey
contended that the survey process is made worse for employees who fear any agencies will always be required. CMS
inconsistent and subjective, and mistake could trigger a revisit and its provides review and oversight of State
proposed that the revisit user fees be associated fee. survey agencies through the CMS
postponed until these process issues are Response: If a problem has already regional offices. Our internal quality
resolved. Another commenter felt that been corrected at the time of a standard assurance system provides for regional
revisit user fees represent punishment, survey or complaint investigation, the office up-front input or subsequent
especially when deficiencies are survey itself can confirm that the review when there is concern regarding
erroneously cited. Two commenters correction has brought the provider or whether the revisit survey should be
requested assurances that only supplier back into compliance with conducted onsite or offsite. However we
legitimate deficiencies will be cited, that federal requirements and the surveyor have always maintained that a condition
unnecessary revisits will not be would document such a determination. level citation requires an onsite revisit
conducted, and that revisits will not be In such a case no revisit would be survey. ‘‘G’’ level deficiencies in
conducted solely for the purpose of required unless the correction failed to nursing homes are serious and are cited
collecting user fees. One commenter felt assure compliance. We appreciate that only when one or more nursing home
residents have been harmed. We will substantial compliance with the type and the type of the revisit survey
continue to conduct revisits in such Medicare Conditions of Participation or (onsite or offsite). If costs change
circumstances. Conditions for Coverage, it must remain significantly in any future period for
under the jurisdiction of the State which authority for the revisit user fee
2B. Survey Process: Hospitals, Home
Survey Agency until the State Survey exists, we would publish a Federal
Health Agencies, Hospices, Ambulatory
Agency verifies through revisits that the Register notice providing a revised fee
Surgical Centers, Rural Health Clinics,
facility has corrected its deficiencies schedule to the extent that fees may be
and End-Stage Renal Disease Centers
and demonstrated substantial affected.
Comment: One commenter felt that compliance. We believe in this case, the We also proposed that exceptions to
although survey teams work off the removal of deemed status that initiated the assessment of a revisit user fee will
same worksheets, there is variation in with a validation survey, that then be identified based on the type of visit
how different survey teams assess remains under the jurisdiction of the conducted. For example, we proposed
similar situations. Therefore, the State survey agency is equivalent to any that neither a provider nor a supplier
commenter felt that requiring a ‘‘revisit’’ other provider or supplier seeking will be assessed a fee if the visit is
fee for all resurveys (either onsite or recertification. In this case a provider or considered a ‘‘State monitoring visit’’
offsite) will increase the number of supplier cited for a deficiency during a unless the visit also meets the definition
times that home health agencies will recertification survey that requires a of a revisit, if the visit is to confirm
contest the survey findings, which then revisit survey would be assessed a Medicare provider or supplier
they may enter into an informal dispute revisit user fee. compliance with Life Safety Code (LSC)
resolution process not only to avoid the Comment: One commenter requested requirements, if the visit is to conduct
revisit fee but also to respond to the clarification as to whether a full survey a Federal Monitoring Survey, such as a
issue of survey variation. following a substantiated complaint Federal look-behind survey. See 72 FR
Response: CMS continuously works survey in a deemed provider or supplier 35677 (discussing ‘‘state monitoring
with States to ensure that surveys are as is a revisit as defined in proposed visit,’’ LSC, and Federal Monitoring
consistently applied as possible. CMS § 488.30(a). Surveys).
also operates a national internal Response: A full survey that is
consistency program in which We also proposed in § 488.30(b)(1)(iii)
conducted pursuant to a complaint
validation surveys are conducted by through (b)(1)(v) that CMS may adjust
investigation of an accredited facility
Federal surveyors to promote optimum revisit user fees to account for the
that has found condition-level
consistency. It is possible that the revisit provider or supplier’s size, typically
noncompliance is viewed as a revisit for
user fees may have the ancillary effect determined by capacity (such as the
the purposes of the revisit fee. As
of increasing the extent to which number of beds), the number of follow-
discussed in the response above,
providers or suppliers dispute the noncompliance with a Federal up revisits resulting from uncorrected
findings of surveys or complaint condition typically requires a removal deficiencies, and/or the seriousness and
investigations. We believe this may of deemed status and a full survey of a number of deficiencies (such as the
occur whether the revisits are offsite or provider. The purpose of this full survey scope and severity of cited deficiencies
onsite. We will monitor the effect of the is two-fold: To verify correction of the and the number of deficiencies cited at
revisit fees to determine if any future condition-level deficiencies identified each scope and severity level), as these
adjustments are advisable. on the complaint investigation, and also criteria pertain to particular provider
Comment: One commenter requested to confirm that the facility is in types. Variance in provider/supplier
clarification on whether user fees will substantial compliance with all of the size, the number of follow-up revisits,
be imposed on accredited providers or pertinent conditions for participation and the type and number of deficiencies
suppliers for a revisit following a before the State survey agency returns cited may have an impact on the survey
sample validation survey. jurisdiction over the facility to the hours needed for a revisit. We also
Response: We will not charge a fee for accreditation organization. Thus we proposed in § 488.30(b)(2) that CMS
a validation survey of a provider or believe the activities of the survey fall may adjust the fees to account for any
supplier that has been duly accredited within the purposes of a revisit survey. regional differences in cost.
by a CMS-approved accrediting We appreciate all the comments We received a variety of comments for
organization and deemed to meet received regarding our current survey this section, the majority of which
Medicare requirements. While we process for all providers and suppliers. discussed quality of care and the
believe that a revisit fee pursuant to a CMS will maintain the current policy concern that the user fee might cause
validation survey has basis, it is absent process for the immediate future. We adverse incentives. We summarized all
in the language of the Continuing will take all of these comments under of these comments and responded to
Resolution. We would view this as consideration as we continue to work them under the general comments
similar to a revisit survey conducted for with States and our national consistency section of this final rule. The comments
a non-accredited provider; we did not program to provide continued oversight discussing the specific criteria proposed
however specify such a charge in the and regulatory compliance guidance. in § 483.30(b) are provided below.
proposed rule. We will therefore not Comment: A few commenters stated
charge a revisit user fee in this final rule Section 488.30(b)—Criteria for that additional information was needed
for a revisit that follows a validation Determining the Fee about how the various factors (for
survey, provided that the deemed status We proposed in § 488.30(b) to provide example, a provider’s size, number of
of the provider or supplier has not been the criteria for determining the user fee. revisits, scope and severity of
removed by CMS. However, any survey, We proposed that for initial deficiencies) will impact the amount
including a validation survey, that finds implementation of revisit user fees, we being assessed. They asked whether
noncompliance with a Condition will use the criteria in proposed CMS would notify providers in advance
(compared to just a Standard), typically § 488.30(b)(1)(i) and (ii): That a provider of the actual amount that would be
requires removal of deemed status and or supplier will be assessed a revisit assessed, and whether providers would
a full survey of a provider. When an user fee based on the average cost per be notified about how these factors were
accredited facility is found not to be in revisit survey per provider or supplier specifically used to assess a given fee.
Response: We believe that the In this regulation we are providing the methodology per provider type. If
adjustment criteria outlined in this information needed for each provider or regional cost differences were invoked
regulation can be important factors supplier to know the amount that they in any future change to the fee schedule,
affecting the number of survey hours would be charged if a revisit occurs. we would publish a proposed and final
that would be required in a revisit These criteria incorporate the average notice in advance of any such changes.
survey and therefore the cost of such cost per provider or supplier for Comment: One commenter identified
revisit survey. However, the final fee conducting a revisit survey and the type that CMS, on July 17, 2007, stated that
schedule published in this rule does not of revisit survey conducted (onsite or certain provider types in California’s
make use of all the potential factors that offsite). We would charge the same fee Orange, Riverside, San Bernardino and
might otherwise be used because we each time a revisit occurs, so if a revisit Los Angeles Counties would be under a
believe many of the factors require more revealed that the facility had not 2 year demonstration to re-enroll in
analysis. Of the criteria listed in achieved full compliance and if a Medicare, as well as be subject to a
488.30(b), CMS is only using second revisit were required, the survey should the provider have had a
488.30(b)(1)(i) and (ii) for the immediate provider would be charged the same Change of Ownership within the last 2
future. amount again for the second revisit. years. The commenter asked that
If Congressional authority for the Comment: One commenter suggested providers not be assessed a fee if the
revisit fee is renewed or extended, and that the fee should be based on the total visit is associated with this
CMS changes the overall methodology or estimated hours of service, not by the demonstration.
for calculating and collecting these fees, actions performed during a survey. Response: We agree with the
CMS will implement these changes Another commenter suggested that a commenter and have specified that
through notice and comment ‘‘cap’’ be placed on the total amount of neither a provider nor a supplier will be
rulemaking in the Federal Register. If user fees associated with a single revisit assessed a fee if the visit is considered
Congressional authority for the revisit and associated with a given provider. a ‘‘State Monitoring visit’’ unless the
fee is renewed or extended but CMS One commenter acknowledged the visit also meets the definition of a
will not being implementing any intent of the proposed change and revisit survey in this rule. In this case,
methodological changes, CMS will encouraged CMS to adjust revisit user a Change of Ownership action, and
publish proposed and final notices in fees according to particularities of the other actions involved in this particular
the Federal Register to announce and states, such as staff travel time, etc. State demonstration, are considered a
solicit comment on planned updates, Response: We proposed in the June ‘‘State Monitoring visit’’ for purposes of
adjustments, or changes to the criteria 29, 2007 Proposed Rule to use criteria this final regulation and final fee
used, if changes are to be made. (b)(1)(i) (average cost per provider or schedule. Therefore, providers and or
For example, CMS does not plan to supplier type) and (b)(1)(ii) (revisit type: suppliers participating in the two year
use criterion set forth at 488.30(b)(2)— Onsite or offsite), and have retained demonstration would be exempt being
regional differences in cost—in the those criteria in this final rule and fee assessed a revisit user fee if the revisit
immediate future. However, if CMS schedule. We agree with the commenter is associated with visits conducted
should decide to use it in the future, that the fee should be based on the total solely on behalf of this demonstration
CMS will publish a notice in the or estimated hours of service. We have and to the extent that they do not
Federal Register announcing CMS’s utilized an average cost per provider or involve deficiencies in compliance with
intention to do so, describing how CMS supplier based on the average costs per the Conditions of Participation or
intends to use and operationalize hour for conducting revisit surveys. We Coverage.
488.30(b)(2), and to solicit public appreciate the comment regarding We appreciate all of the commenters’
comment. Similarly, for technical suggesting a ‘‘cap’’ on the total amount suggestions on our proposed criteria
adjustments or updates to the fee of fees associated with a single revisit. sections, and have clarifications in
schedule (e.g. adjustments for cost of We believe the methodology in this rule response to a number of the
living increases), CMS will issue public conforms to the ‘‘cap’’ idea. As commenters’ concerns. We intend to
notices in the Federal Register. discussed in the proposed rule, provide the requested detail in
On the other hand, if CMS should providers or suppliers will be assessed incorporating additional criteria when
decide in the future to use a completely one fee per revisit. As discussed in the calculating any changes to the fee
different criterion not described in these Proposed Rule, when offsite preparation schedule for revisit user fees, if
rules, CMS will publish a notice of is required, as it is in many cases, the authority is provided by the Congress
proposed rulemaking announcing this provider or supplier would not be and through the notice and rulemaking
change in methodology. assessed a separate revisit fee for this process described earlier. We believe we
Such future notices would address the offsite preparation. Instead, the entire have addressed concerns raised in this
commenters’ concern regarding provider preparation and actual onsite revisit section, therefore we will retain the
or supplier size, for example, and how will count as an onsite revisit survey. proposed language in § 483.30(b)(1) and
the number of beds or the number of Based on current data analysis, CMS (b)(2) as final. We accordingly have
patients or residents served might affect proposed to implement the revisit user calculated the final fee schedule based
a revisit fee. fee utilizing only criteria identified in on selected criteria. The final fee
In this final rule we do reserve the § 488.30(b)(1)(i) and (1)(ii). We schedule will utilize criteria in
right to adjust fees based on the number appreciate the commenters § 488.30(b)(1)(i) and (b)(1)(ii) as
of follow-up revisits conducted either encouragement to look at differences in proposed and finalized by this rule.
decreasing or increasing fees based on State costs for the revisits. In proposed
the costs that are incurred by state § 488.30(b)(2) we reserved the right to Section 488.30(c)—Fee Schedule
survey agencies to conduct these adjust the fees to account for regional We proposed in § 488.30(c) that CMS
multiple follow-ups. Any change to the differences in costs. It is our intent to will publish in the Federal Register the
current fee schedule in which the same conduct further analysis on these proposed and final notices of a uniform
revisit user fee is applied for each additional criteria in proposing future fee schedule before it adopts this
revisit, will be preceded by Federal fee schedules. In this rule, the final fee schedule. The proposed and final
Register notice of the planned change. schedule is based on a simpler flat-rate notices would set forth the amounts of
the assessed fees based on the criteria as Comment: One commenter believed final that § 488.30(c) will read: ‘‘CMS
identified in paragraph (b) of this that the Federal Register notice must publish in the Federal Register the
subpart. In future notices, any changes contained a number of labels displaying proposed and final notices of a uniform
to the amounts of the assessed fees data regarding estimated costs and 2006 fee schedule before it assesses revisit
would include for example, adjustments frequencies of revisit surveys, the user fees. The notices must set forth
based on increases to cost of living, commenter felt that based on the which criteria will be used and how, as
labor and overhead costs. The proposed proposed language in Section 488.30(b) well as the amounts of the assessed fees
rule also constituted publication of the that CMS intends to exercise based on the criteria, as identified in
proposed fee schedule. considerable latitude in the actual paragraph (b) of this subpart.’’ Language
We based user fee calculations in the levying of fees in a specific situation.
placed in bold for emphasis on the
proposed rule and fee schedule on the Another commenter felt that it is unfair
type of revisit (onsite vs. offsite); the changes. We also note through the
to providers to impose fees without
type of provider or supplier; the average advance notification of the actual costs publication of this final rule that if
number of hours that a revisit requires; based on any adjustment criteria. authority for the revisit user fees is
and the average per hour cost of a Response: We will publish in the continued, we will use the current fee
revisit. We have identified the revisit Federal Register the proposed and final schedule in this rule for the assessment
survey costs below under section IV, notices of a uniform fee schedule before of such fees until such time as a new fee
Regulatory Impact Analysis. we adopt this schedule. Both notices schedule notice is proposed and
We have received varying comments would set forth the amounts of the published in final form.
raised under this section. The majority assessed fees based on the criteria as The final fee schedule is identified
of these comments referenced concerns identified in section 488.30(b). It will below in Table A. Summation of data
also raised under general comments, the also specify which of the criteria listed and calculations regarding this final fee
current survey process, and the criteria in 488.30(b)(1)–(2) will be used and how schedule is discussed in section V,
for determining the fee. We believe we they will be operationalized.
Regulatory Impact Analysis summary
have addressed these concerns in other In response to the nature of these
sections. Comments received on comments, we have clarified the below.
§ 488.30(c) are below: regulatory language and thus adopt as
TABLE A.—FINAL FEE SCHEDULE FOR REVISITS SURVEYS

[Onsite and offsite]
Fee assessed Fee assessed

Facility per offsite per onsite
revisit survey revisit survey
SNF & NF ........................................................................................................................................................ $168 $2,072

Hospitals .......................................................................................................................................................... 168 2,554
HHA ................................................................................................................................................................. 168 1,613
Hospice ............................................................................................................................................................ 168 1,736
ASC .................................................................................................................................................................. 168 1,669
RHC ................................................................................................................................................................. 168 851
ESRD ............................................................................................................................................................... 168 1,490
Section 488.30(d)—Collection of Fees 1. § 488.30(d)(1)—Collection Methods the various comments, CMS will modify
the last sentence of § 488.30(d)(1) by
We proposed in § 488.30(d)(1) that Comments: Several commenters
adding ‘‘any method allowed by law,
fees for revisit surveys under this indicated that regarding the proposed
including credit card; electronic fund
paragraph may be deducted from language that fees for revisits be
transfer; check; money order; offset
amounts otherwise payable to the deducted from amounts otherwise
payable to the provider, they raised collection from claims submitted.’’ We
provider or supplier. We also proposed will include all necessary details within
that fees will be deposited as an offset concern that there were no specifics as
to whether these fees would be this coupon notice, including to whom
collection to be used exclusively for to direct questions, and payment
deducted all at once or on a schedule.
survey and certification activities remittance information. In addition, as a
conducted by State survey agencies Response: In the proposed language
result of various comments regarding
pursuant to section 1864 of the Act or CMS identified a number of methods for
the collection of the revisit user fee. For the time frame for when we may collect
by CMS, and will be available for CMS fees, and the concerns regarding the
the immediate future, we will utilize a
until expended. We also proposed that schedule of these fees, we will include
bill pay system. Providers or suppliers
CMS may devise other collection an additional subparagraph
who are assessed a fee will receive a
methods as it deems appropriate. In notice in the mail which will include § 488.30(d)(3) to this section that
determining these methods, CMS will the amount of the assessed revisit fee indicates: ‘‘Fees for revisit surveys will
consider efficiency, effectiveness, and and the revisit survey for which the fee be due for any revisit surveys conducted
convenience for the providers, is assessed. Included in the notice is the during the time period for which
suppliers, and CMS. In the Proposed obligation that payment is expected to authority to levy a revisit user fee
Rule we stated that Methods may exists.’’
be remitted within 30 calendar days of

include: Credit card; electronic fund the date of the notice. As a means of Comments: One commenter indicated
transfer; check; money order; and offset clarification and to expand on payment that they would prefer that if fees are
of collections from claims submitted. methods that may be beneficial to needed, then providers should be
providers and suppliers and based on charged an up-front fee that does count
towards approved expenses of doing identified in part 413, subpart B of this so that the individual provider’s costs
business/cost report based on bed size. chapter, under title XVIII of the Act. The are not borne by other patients.
Response: The revisit user fees are revisit user fee will be levied only as a CMS believes that the assessed revisit
limited to fees for revisit surveys result of a provider’s failing to meet user fee is not an allowable item for a
conducted as a result of deficiencies basic quality of care or safety standards cost report, as it should not be figured
cited during an initial certification, that are required as a condition of into the services provided to
recertification and substantiated participation or coverage in the beneficiaries, nor should it be a cost
complaint surveys. The fee will only be Medicare program. As such, it is not shared amongst non-Medicare patients.
applied when revisits are needed to appropriate for a revisit user fee to be CMS employs several checks and
assure substantial compliance that an allowable item for a cost report. To balances to deter this from occurring.
requirements are met. Although we do so would lead to both cost-shifting CMS believes that this proposed
appreciate the commenters statement, and the counterintuitive result that language in § 488.30(d)(2) would
Congress’ clear intent was that CMS more quality breakdowns could lead to prevent the inclusion of the revisit user
assess a fee only for revisits required as more payment. For these reasons, the fee costs in any future cost reports. This
a result of deficiencies cited. It would be Secretary has put in place the necessary section will only apply to a small group
out of the scope of our authority to mechanism for which cost-shifting of providers who receive cost-based
assess fees for upfront survey costs. would be prevented. In addition, a reimbursement. A significant amount of
significant number of providers and providers and suppliers are reimbursed
2. § 488.30(d)(2)—Cost Report
suppliers are reimbursed through the through the prospective payment system
Comment: One commenter raised prospective payment system; as a result, (PPS).
concern regarding our statement: ‘‘At no only a small group of providers as As a result of comments received to
time is the individual provider’s cost compared to the overall number of § 488.20(d)(1) and (d)(2) and CMS’
borne by other patients.’’ The providers and suppliers receive cost further consideration, we will modify
commenter felt our statement disregards based reimbursements. the proposed language of § 488.30(d)(1)
the nature of medical transactions and While the user fee program is simply and retain the proposed language of
that these revisit user fees, if extracted intended to defray costs of the revisits, § 488.30(d)(2) as final. The proposed last
from the provider’s income stream, we believe that the design of the user fee sentence of § 488.30(d)(1) will be
would directly impact the range and program we finalize will result in a modified to read: ‘‘Any method allowed
quality of the services rendered by positive correlation between quality of by law, including credit card; electronic
competing on a cash basis with all other care and amount of the fees—the better fund transfer; check; money order; offset
spending priorities in the practice. the quality of care, the lower the fees. collection from claims submitted.’’ The
Response: Each revisit user fee will We also expect that the prospect of fees remainder of the proposed language will
arise from a provider’s documented for revisits will promote greater be retained as final.
failure to comply with federal compliance with federal quality of care
requirements for quality of care or Section 488.30(e)—Reconsideration
requirements, thereby making for fewer Process for Revisit User Fees
safety. We hope that a provider would revisits and fewer fees over time.
not respond to a fee arising from such Comment: A commenter stated that as We proposed in § 488.30(e) that a
failure by decreasing quality of care. a result of the financial burden of the reconsideration process shall be
Such an action could simply give rise to revisit user fee, the expense for the available to providers or suppliers that
more quality compromises, more payment of this fee would be cost- have been assessed a revisit user fee if
complaints, more surveys or complaint shifted to private pay residents. The a provider or supplier believes an error
investigations, more revisits, and more commenter stated that, if the fee were to of fact, such as a clerical error, has been
fees. The result would not make be advanced this should include a made. We also proposed that a request
economic or medical sense. We requirement that would ensure for reconsideration must be received by
appreciate the commenter’s concern that increased Medicaid/Medicare CMS within seven calendar days from
a provider might respond to a revisit fee reimbursement to avoid shifting burden the date identified on the revisit user fee
by reducing services. This would of added costs to private-pay residents. assessment notice.
represent a business decision on the Another commenter felt that the fee Comment: Several commenters
part of the provider. An alternative would also amount to a shifting of funds believe that a reconsideration process
would be to invest in remedial action so and as a result either the money is should be available for surveyor errors
that quality would be improved and the withheld from the hospital up front as and substantial errors of interpretation,
prospect of future revisits and revisit part of budget cuts or the hospital has and that it should not be limited to just
fees would be reduced. We hope that to pay it back as part of their CMS clerical errors. Another commenter
providers will adopt the alternative certification process. indicated that the reconsideration
approach. Response: We proposed in process should include unfounded
Comment: Some commenters objected § 488.30(d)(2) that fees for revisit citations. One commenter asked for
to the fee, but stated that if the fee were surveys under this section are not clarification on what was meant by
adopted then it should be considered an allowable items on a cost report, as ‘‘error of fact,’’ as a basis for requesting
allowable cost on the cost report. The identified in part 413, subpart B of this a reconsideration. Another commenter
commenters expressed concern as to chapter, under title XVIII of the Act. asked whether a provider could request
where the funds would come from if the Part 413 identifies CMS’ formulating a reconsideration of a fee if they were
fees were not permitted as an allowable methods for making fair and equitable in the process of appealing deficiencies.
cost on the cost report, particularly, in reimbursement for services rendered to Response: The reconsideration
an industry already struggling to beneficiaries of the program. Payment is process for revisit user fees is intended
continue to provide services. to be made on the basis of current costs only for those situations in which a
Response: We proposed in of the individual provider, rather than provider or supplier believes that an
§ 488.30(d)(2) that fees for revisit costs of a past period or a fixed error of fact has been made in the
surveys under this section are not negotiated rate. This cost report also application of the revisit user fee. These
allowable items on a cost report, as designs this reimbursement formulation errors of fact would include such things
as clerical errors, billing for a fee limited possibility that payment would that identifies that we will issue a credit
already paid, inadvertent billing for a be sent without CMS providing a toward any future revisit surveys
revisit following a validation survey of response to the reconsideration. We, conducted if a provider or supplier has
a deemed provider, or assessment of a however, believe that regulatory remitted an assessed revisit user fee and
fee when there was no revisit clarification is warranted based on the for which a reconsideration request is
conducted. A request for type of comments received. We have found in favor of the provider or
reconsideration of an assessed revisit modified the proposed text to include supplier as we discussed in the
user fee is a separate process from any separate subparagraphs § 488.30(e)(1)(i) preamble text of the Proposed Rule. We
informal dispute resolution or appeal of and (ii), (e)(2), and (e)(3). The modified further clarify that we ‘‘in the event that
the underlying deficiency citations. language of § 488.30(e) will read as CMS judges that a significant amount of
Comment: Several commenters follows: time has elapsed before such a credit is
thought that limiting the window for used, CMS will refund the assessed
(e) Reconsideration process for revisit user
revisit user fee reconsideration request fees. revisit user fee amount paid to the
to seven calendar days was unrealistic (1) CMS will review a request for provider or supplier.’’ In regards to the
and requested that the timeframe for reconsideration of an assessed revisit user commenters’ specific suggestion that
reconsideration requests be expanded to fee— refunds should be made within 30
30 calendar days. Another commenter (i) If a provider or supplier believes an calendar days, or commenters that
requested that the timeframe for a error of fact has been made in the application suggested 60 calendar days, CMS will
reconsideration request be extended to of the revisit user fee, such as clerical errors, make a concerted effort to respond to
10 calendar days, and other commenters billing for a fee already paid, or assessment requests for reconsideration within a
of a fee when there was no revisit conducted,
suggested a 14 or 15 calendar day timely manner and notify providers or
and
window. However, one commenter (ii) If the request for reconsideration is suppliers that the reconsideration was
thought that the seven day window was received by CMS within 14 calendar days determined in their favor, as applicable
reasonable. from the date identified on the revisit user prior to the time frame for which they
Response: We proposed that a request fee assessment notice. must remit payment. However, in those
for reconsideration must be received by (2) CMS will issue a credit toward any cases where remittance has occurred
CMS within seven calendar days from future revisit surveys conducted, if the and the provider or supplier has not
the date identified on the revisit user fee provider or supplier has remitted an assessed experienced an additional revisit survey
assessment notice. CMS has considered revisit user fee and for which a
and is then due a refund, CMS is
the commenters’ suggestions for reconsideration request is found in favor of
the provider or supplier. If in the event that committed to developing a system that
extending the timeframe for submitting CMS judges that a significant amount of time would ensure efficient refund of any
a reconsideration request and we have has elapsed before such a credit is used, CMS monies collected in error. CMS’ present
agreed to expand the timeframe for will refund the assessed revisit user fee bill pay system would require more than
reconsideration requests to 14 calendar amount paid to the provider or supplier. 30 to 60 calendar day processes. We
days from the date identified on the (3) CMS will not reconsider the assessment estimate that this cause for a refund may
revisit user fee assessment notice. We of revisit user fees that request occur in less than 5% of all overall
will, therefore, change the timeframe for reconsideration of the survey findings or cases. At this time, CMS does not have
submitting a reconsideration request to deficiency citations that may have given rise the requisite data in which to provide
14 calendar days in the final rule. The to the revisit, the revisit findings, the need
specific amounts of provider or
time trigger date is the date when the for the revisit itself, or other similarly
identified basis for the assessment of the suppliers falling into this category,
assessment notice is prepared and sent. revisit user fee. however we believe it will be an even
The revisit survey must have occurred lower percentage provided all the
prior to our assessment of a revisit user We believe that the potential that a inherent checks and balances in our
fee. provider or supplier would be assessed current survey and certification process.
Comment: Several commenters a revisit user fee due to clerical error Comment: Several commenters
suggested that, where a reconsideration would be rare, when this is viewed requested that CMS clarify the time
determines that a revisit user fee was through the overall survey process and frame for when a reconsideration
charged in error, any payments made checks and balances inherent in the decision will be made, and one
should be refunded immediately, survey and certification process. We commenter requested that CMS include
instead of applying the payment to believe that in the rare case that this a deadline in the regulation for
future assessments of fees. One assessment should occur, we have responding to reconsideration requests.
commenter suggested that refunds provided providers and suppliers with One commenter proposed that
should be made within 30 days, an opportunity to request a reconsiderations be resolved within 30
whereas another commenter suggested reconsideration. We, indicated, days of a reconsideration request.
60 calendar days of approval of a however, in § 488.30(e)(3) that ‘‘we will Response: CMS is cognizant of the
reconsideration request. Commenters not reconsider the assessment of revisit providers’ 30 calendar day time frame
thought that actions related to fees user fees that request reconsideration of for submitting payment and will ensure
should remain pending until the the survey findings or deficiency that reconsiderations are resolved in a
outcome of the reconsideration, and that citations that may have given rise to the timely manner. CMS will make a
a fee should not be paid until a facility revisit, the revisit findings, the need for concerted effort to respond to request
exhausts its appeals; upon successful the revisit itself, or other similarly for reconsideration within a timely
reconsideration, a provider would identified basis for the assessment of the manner and notify provider or suppliers
receive written confirmation that a fee is revisit user fee.’’ We also, based on that the reconsideration was determined
null and void. comments received, have provided in their favor, prior to the time frame for
Response: We believe that given the providers and suppliers a greater which they must remit payment.
proposed timeframe for submitting a window for submission of requests for We appreciate comments received on
reconsideration request and the reconsideration from 7 calendar days to time frames, refund methodology, and
regulatory obligation of payment (within 14 calendar days. We are including notification. As a result of suggestions,
30 calendar days), there would be a additional language in § 488.30(e)(2) we have modified § 488.30(e) to include
within 14 calendar days for requests for within 30 calendar days, the total Subpart E—Termination of Agreement
reconsideration. Section 488.30(e) will amount of planning time available to the and Reinstatement After Termination
read in final as discussed above. provider or supplier will have totaled Section 489.53 Termination by CMS
Section 488.30(f)—Enforcement much more than the 30-calendar day
period before any enforcement action Section 489.53(a)(16)
We proposed in § 488.30(f) that if the may occur. Finally, the revocation of We proposed to add a new paragraph
full revisit user fee payment is not
billing and enrollment privileges is not (16) to § 489.53(a) that would create an
received within 30 calendar days or a
an immediate action upon the failure of additional basis for termination if a
request for reconsideration is not
received within seven calendar days a provider or supplier to remit the provider has failed to pay a revisit user
from the date the provider or supplier assessed revisit user fee. In this final fee when and if assessed.
receives written notice of assessment, rule we therefore retain the time-frames We did not receive comments
CMS may terminate the facility’s for which action will occur regarding regarding this additional paragraph and
provider agreement and enrollment in this process and retain the amended thus we retain the proposed language in
the Medicare program or the supplier’s language to § 424.535(a)(1) as final. § 489.53(a)(16) as final.
enrollment and participation in the Comment: A commenter indicated III. Provisions of the Final Rule
Medicare program, and the provider or that the definition of revisit survey In this final rule we are adopting the
supplier may not seek Medicare should be revised to limit it to those
payment, nor be considered a Medicare provisions as set forth in the June 29,
revisits in which the cited deficiency 2007 proposed rule with the following
participating provider or supplier. We includes and is subject to an
have changed the seven calendar day revisions:
enforcement action under Subpart B of All additional language proposed in
time period for filing of a
Part 489. § 424.535, Revocation of enrollment and
reconsideration request to fourteen
calendar days. Otherwise, CMS will Response: We have not included the billing privileges in the Medicare
adhere to the termination process as commenter’s suggestion to revise the Program will be retained as final.
identified in § 489, subpart E, of this term revisit survey to include ‘‘is subject All proposed definitions in
chapter. to an enforcement action under subpart § 488.30(a) are adopted as final, except
Comment: Some commenters B of Part 489.’’ Subpart B of part 489 for an addition to the definition of
connected the discussion of revocation governs provider agreements, not ‘‘provider of services, provider or
of billing and the termination for enforcement actions. However, we do supplier.’’ The final definition now
nonpayment as proposed in § 488.30(f) includes religious nonmedical health
agree with the premise of the
and § 489.53(a)(16). One commenter felt care institutions.
commenter’s suggestion and thus have
that termination for nonpayment within All proposed language in
modified language in § 488.30(f) to § 488.30(b)(1) and (b)(2) criteria for
30 days is power disproportionate to the include cross references to the
offense and is unrelated to quality of determining the fee is adopted as final.
appropriate subpart and subsection of Language proposed in § 488.30(c) Fee
care and safety issues. Another
part 489 (governing termination) and to schedule is modified by removing term
commenter felt that this provision is
a subsection of part 424 (governing ‘‘will’’ and inserting the term ‘‘must’’
reason not to participate in Medicare, or
to care for Medicare patients. revocation of enrollment and billing where applicable, we also removed
Response: While we proposed that a privileges). ‘‘adopts this schedule’’ and added
provider or supplier may also be Section 488.30(f) will be modified to ‘‘assesses revisit user fees’’ for
determined not to be in compliance if a read as applicable components clarification. In addition we include that
revisit user fee payment has not been ‘‘pursuant to § 489.53(a)(16) of this the clarifying language ‘‘which criteria
received within 30 calendar days from chapter’’ and ‘‘pursuant to will be used and how, as well as
the date identified on the assessment § 424.535(a)(1) of this chapter.’’ We * * *,’’ the remainder of the language is
notice, we also state at § 424.535(a)(1) retain the remainder of the proposed adopted as final.
that all providers and suppliers are language in § 488.30(f) as final. The last sentence of the language
granted an opportunity to correct the proposed in § 488.30(d)(1) has been
deficient payment compliance before a Part 489—Provider Agreements and modified for clarification to state that
final determination is made to revoke Supplier Approval ‘‘CMS may consider any method
billing and enrollment privileges. We allowed by law, including: Credit care;
Subpart B—Essentials of Provider
further note that a payment-due notice electronic fund transfer; check; money
Agreements
from CMS is preceded by a survey or order; and offset collections from claims
complaint investigation that has found Section 489.20 Basic Commitments submitted, the remainder of this
deficiencies, a correction period paragraph is retained as final. All
afforded to the provider or supplier, a Section 489.20(u) proposed language in § 488.30(d)(2)—
revisit to confirm compliance, then a We proposed to add to § 489.20 an the prohibition of inclusion of the
later issuance of the payment-due additional paragraph that would require revisit user fee on a provider cost
notice, followed by the formal 30-day a provider to agree to pay revisit user report—is adopted as final. We have
advance notice to the provider. As soon fees when and if assessed. added a new subparagraph and new
as a revisit occurs, each provider or language as a result of various
supplier will know that a revisit user fee We did not receive comments comments regarding the time frame for
will follow at a later date, will know the regarding this additional paragraph. when we may collect fees, and the
amount of the fee due from the fee However, due to technical changes, concerns regarding the schedule of these
schedule published in this rule, and paragraph (u) is designated as paragraph fees, § 488.30(d)(3) will read: ‘‘Fees for
will know that the payment will be due (w) and we will retain the proposed revisit surveys will be due for any
within 30 calendar days. While the rule language as final. revisit surveys conducted during the
specifies that enforcement action may time period for which authority to levy
occur if the bill has not been paid a revisit user fee exists.’’
Language proposed in § 488.30(e) to the notice and comment provision of duties) directs agencies to assess all
reconsideration process for revisit user section 553(b) of the APA. costs and benefits of available regulatory
fees will be modified by changing the The legislative history of the APA alternatives and, if regulation is
formatting of the paragraph to include indicates that the purpose for deferring necessary, to select regulatory
paragraphs (e)(1)(i), (e)(1)(ii), (e)(2), and the effectiveness of a rule under section approaches that maximize net benefits
(e)(3). Language in paragraph (e)(1)(i) 553(d) was to ‘‘afford persons affected a (including potential economic,
previously proposed as first sentence in reasonable time to prepare for the environmental, public health and safety
paragraph (e) is retained as final. We effective date of a rule or rules or to take effects, distributive impacts, and
have modified paragraph (e)(1)(ii) by other action which the issuance may equity). A regulatory impact analysis
changing that a request for prompt.’’ S. Rep. No. 752, 79th Cong., (RIA) must be prepared for major rules
reconsideration must be received by 1st Sess. 15 (1946); H.R. Rep. No. 1980, with economically significant effects
CMS within 14 calendar days instead of 79th Cong., 2d Sess. 25 (1946). In this ($100 million or more in any 1 year).
the 7 calendar days as proposed. We case, affected parties do not need time This final rule is not a major rule. The
have added a new paragraph (e)(2) that to adjust their behavior before this rule aggregate costs will total approximately
identifies when CMS will issue a credit takes effect. With or without a revisit $37.3 million in any 1 year.
or a refund of an assessed revisit user fee, a provider or supplier must be The RFA requires agencies to analyze
fee in the rare case of a provider or found to have corrected significant options for regulatory relief of small
supplier remitting payment and deficiencies in order to avoid businesses. For purposes of the RFA,
ultimately a reconsideration is decided termination. Additionally, the small entities include small businesses,
within their favor. We have added a application of a fee for the revisit does nonprofit organizations, and small
new paragraph (e)(3) that identifies that not place appreciable administrative governmental jurisdictions. Individuals
a request for reconsideration of the burdens on the affected providers or and States are not included in the
revisit user fee may not include suppliers. We do not expect appreciable definition of a small entity. Small
reconsideration of the survey findings or cost to State survey agencies because businesses are small entities, either by
deficiency citations that may have given CMS is undertaking the billing and nonprofit status or by having revenues
rise to the revisit, the revisit findings, or collection of the revisit user fee. of $6.5 million to $31.9 million or less
the need for the revisit itself. CMS identified in the proposed rule in any 1 year for purposes of the RFA.
All proposed language in § 488.30(f) the immediacy of this revisit user fee In the June 29, 2007 Federal Register,
Enforcement is adopted as final with the program and the limited nature of the CMS issued a proposed rule identifying
addition of language identifying the Continuing Resolution. Specifically, the its limited information to separate and
Continuing Resolution requires CMS to identify specific providers and suppliers
interconnection of changes made to both
implement the revisit fee program in that may be subject to a revisit user fee
§§ 424.535(a)(1) and 489.53(a)(16). The
fiscal year 2007. Accordingly, providers by the requirements described for
language will read in final: ‘‘If the full
and suppliers have been on notice for purposes of the RFA. CMS also
revisit user fee payment is not received
some time that these fees would be identified its limited information on the
within 30 calendar days from the date
imposed, and do not need additional total revenues collected by provider or
identified on the revisit user fee
time to be prepared to comply with the supplier type. CMS does collect
assessment notice, CMS may terminate
requirements of this regulation. We information regarding Medicare and
the facility’s provider agreement
believe that given the short time frame Medicaid claims submitted, however
(pursuant to § 489.53(a)(16) of this
that CMS has to collect fees before the this would not provide the requisite
chapter) and enrollment in the Medicare requirements for the RFA regarding total
program or the supplier’s enrollment authority of the Continuing Resolution
expires, there is good cause to waive the revenues. CMS also identified that it
and participation in the Medicare does collect National level information
program (pursuant to § 424.535(a)(1) of 30 day effective date.
which includes personal health care
this chapter). IV. Collection of Information expenditures and payments. Personal
All proposed new paragraphs to Requirements health care as we discussed in the
§ 489.20 and § 489.53 are adopted as proposed rule includes hospital care,
final. This document does not impose
information collection and professional services, nursing and home
Waiver of 30-Day Delay in the Effective recordkeeping requirements. health care, all of which cover those
Date Consequently, it need not be reviewed services provided by the provider and
by the Office of Management and suppliers who may be assessed a revisit
We ordinarily provide a 30-day delay user fee.
in the effective date of the provisions of Budget under the authority of the
Based on the information provided
a rule in accordance with the Paperwork Reduction Act of 1995.
within the proposed rule a few
Administrative Procedure Act (APA) 5 V. Regulatory Impact Analysis commenters felt that the user fee would
U.S.C. 553(d). However, the delay in the add what they consider financial strains
effective date may be waived as, in A. Overall Impact
on an already strained nursing home
pertinent part, ‘‘provided by the agency We have examined the impacts of this industry, especially to stand alone, not-
for good cause found and published rule as required by Executive Order for-profits. Additionally, two
with the rule’’ 5 U.S.C. 553(d)(3). The 12866 (September 1993, Regulatory commenters stated that the economic
Secretary finds that good cause exists to Planning and Review), the Regulatory implication must be considered,
make effective the revisit user fee and Flexibility Act (RFA) (September 19, including the potential impact on wages
the corresponding fee schedule 1980, Pub. L. 96–354), section 1102(b) of for employees within healthcare
immediately upon display and the Social Security Act, the Unfunded facilities. Another commenter requested
publication in the Federal Register. Mandates Reform Act of 1995 (Pub. L. that CMS in this section take into
The good cause exception to the 30 104–4), and Executive Order 13132. account State differences, citing their
day effective date delay provision of Executive Order 12866 (as amended State’s increased costs for all their home
section 553(d) of the APA is read to be by Executive Order 13258, which health and hospice providers, who are
broader than the good cause exception merely reassigns responsibility of subject to increased fees in general and
felt this user fee would been cited for a deficiency based on certified or deemed certified on a 3 year
disproportionately impact these noncompliance with required cycle.
providers in their State. Another conditions of participation and for In addition, we appreciate the
commenter felt that Home Health which a revisit is needed to make sure commenters’ concern regarding the
Agencies have been adversely impacted that the deficiency has been corrected. potential impact on various rural
by stagnant and declining Based on the information provided as communities. For the immediate future,
reimbursement from both Medicare and a requirement for Section 1102(b) of the we have calculated the user fee by
Medicaid in the past years. Act, some commenters raised concerns provider type and by average number of
CMS specified in the proposed rule that these fees will be very expensive for hours required for a revisit survey. It is
that the providers and suppliers that various rural providers or suppliers, not our intent that we will consider other
may be assessed a revisit user fee fall just rural hospitals, but also small rural criteria as identified in § 488.30(b),
into the category of revenues collected Home Health Agencies and long-term which includes regional differences and
under personal health care funds. As care facilities in rural communities, and facility size when proposing and
such CMS calculated that the overall that CMS could be affecting the finalizing future fee schedules. Based on
impact of the estimated $37.3 million availability of care in rural areas. One our information gathered, we have
that will be assessed for revisit user fees commenter asked why hospitals should determined, and the Secretary certifies,
would only amount to 2.3 percent of the be exempt from the fee just because the that this rule will not have a significant
$1,560.2 million personal health care fee may have a significant impact on impact on small rural hospitals.
revenues collected and only 1.9 percent them; while another commenter raised Section 202 of the Unfunded
of all national health care expenditures what they identified as unfairness in the Mandates Reform Act of 1995 also
of which personal health care frequency of surveys conducted requires that agencies assess anticipated
expenditures are included. annually for long-term care facilities costs and benefits before issuing any
Although we do not deny that the versus 3 years for hospitals. rule whose mandates require spending
revisit user fee would require a payment in any 1 year of $100 million in 1995
Hospitals are not exempt from the
from a provider or supplier who is dollars, updated annually for inflation.
revisit user fees. While hospitals are
assessed a fee due to the need for a That threshold level is currently
surveyed less frequently than nursing
revisit survey, we do not believe it will approximately $120 million. This rule
homes, hospitals are subject to CMS
have such an economic impact that it will have no mandated effect on State,
complaint investigations similar to
would create additional financial strains local, or tribal governments and the
nursing home complaint investigations
on providers and suppliers. We believe impact on the private sector is estimated
as well as other providers and suppliers.
that many providers and suppliers will to be less than $120 million and will
CMS is statutorily obligated to conduct
pay no fees because they consistently only effect those Medicare providers or
provide high quality care, have no a regulatory impact analysis for small suppliers for which a revisit user fee is
deficiencies identified through the rural hospitals as part of its rule making assessed based on the need to conduct
survey process, and therefore will process. As such, we have reviewed a revisit survey to ensure deficient
require no revisits. Thus, this rule will data affecting these rural hospitals, and practices that were cited have been
have minimal financial impact on those upon that review have determined that corrected.
providers and suppliers. In addition, we of all hospitals identified, 285 revisits or Executive Order 13132 establishes
appreciate the commenters’ concern 3.9 percent were conducted in rural certain requirements that an agency
regarding their specific State’s financial hospitals to ensure that deficiencies must meet when it promulgates a
situation. identified were corrected. Based on the proposed rule (and subsequent final
For the immediate future, we have effective time period of this proposed rule) that imposes substantial direct
calculated the user fee by provider type rule, less than 3 percent of all hospitals requirement costs on State and local
and by average number of hours may in fact be assessed a revisit user fee governments, preempts State law, or
required for a revisit survey. It is our in this current fiscal year (FY 2007), we otherwise has Federalism implications.
intent that we will consider other estimate that less than 1 percent of rural This final rule will not substantially
criteria as identified in § 488.30(b), hospitals will be impacted by this rule. affect State or local governments. This
which includes regional differences The statutory analysis that is required final rule establishes user fees for
when proposing and finalizing future does not indicate that small rural providers and suppliers for which CMS
fee schedules. Based on our information hospitals would be exempt from has identified deficient practices and
gathered, we have determined, and the regulatory requirements. Rather, it requires a revisit to assure that
Secretary certifies, that this rule will not requires only that the rule making corrections have been made. Therefore
have a significant impact on small agency must determine the overall we have determined that this final rule
entities based on the overall effect on financial impact on small rural will not have a significant affect on the
revenues. hospitals. We do not make a distinction rights, roles, and responsibilities of
Section 1102(b) of the Act requires us on the quality-of-care provided to State or local governments.
to prepare a regulatory impact analysis residents or patients by either urban or
if a rule may have a significant impact rural location. Federal regulations call B. Impact on Providers/Suppliers
on the operations of a substantial for all residents and patients to receive The source of the data used to
number of small rural hospitals. This adequate care. The revisit user fee will estimate the number and cost of revisit
analysis must conform to the provisions only be assessed as a result of surveys is CMS’s Online Survey,
of section 604 of the RFA. For purposes deficiencies cited with respect to Certification and Reporting (OSCAR)
of section 1102(b) of the Act, we define providers or suppliers not fully database. OSCAR is the repository of
a small rural hospital as a hospital that complying with Federal requirements. information about CMS and State survey
is located outside of a Metropolitan With regard to the survey frequency, agency survey actions. Data collected
statistical Area (superseded by Core nursing homes are mandated by statute include the dates of surveys, survey
Based Statistical Areas) and has fewer to be certified annually, whereas CMS findings, and the length of time that
than 100 beds. This final rule affects policy calls for hospitals (both surveyors spent conducting the survey.
those small rural hospitals that have accredited and non-accredited) to be State survey agencies record survey time
on the CMS–670 form. Data from the Overall Effect on Providers and proposed rule, providers and suppliers
CMS–670 form are entered into OSCAR Suppliers that required a revisit survey ranged
by the State survey agency. CMS We estimate that there are potentially widely across facility types from 87.9
analyzed average survey time length 47,804 providers and suppliers affected percent for skilled nursing facilities
using actual data from FY 2006. by the revisit user fee, although we (‘‘SNFs’’)/nursing facilities (‘‘NFs’’) to
Based on information entered into expect only some of those providers will 2.8 percent for ambulatory surgical
OSCAR, we proposed user fees in be charged a revisit user fee in any one centers. We did not include transplant
accordance with the type of revisit particular year. We based this estimate centers in FY 2006 and 2007
survey (onsite vs. offsite); the type of on FY 2006 actual data. Table B below calculations due to lack of available cost
presents the key information. Of those and revisit data at this time. Transplant
provider or supplier; the average
providers and suppliers, 34.8 percent centers will be newly surveyed
number of hours that a revisit survey
required and received a revisit survey in providers starting in FY 2008, and will
requires; and the average per hour cost
FY 2006, including both onsite and be subject to revisit fees at the hospital
of a revisit survey.
offsite revisits. As identified in the rate.
TABLE B.—PERCENTAGE OF PROVIDERS/SUPPLIERS THAT HAD A REVISIT SURVEY FY 2006
Number of Percent of
Total revisit providers/ sup- provider/ sup-
Total survey for FY pliers that re- pliers that re-
providers/ 2006 (onsite & quired revisit quired revisit
suppliers1 offsite) survey(onsite survey (onsite
& offsite) & offsite)
SNF/NF 2 .......................................................................................................... 15,172 29,426 13,350 87.9

Hospitals3 ......................................................................................................... 7,139 853 594 8.3
HHAs ................................................................................................................ 8,901 1,585 1,320 14.8
Hospices .......................................................................................................... 3,077 307 246 7.9
ASC .................................................................................................................. 4,735 188 133 2.8
RHC ................................................................................................................. 3,828 216 204 5.3
ESRD ............................................................................................................... 4,952 929 781 15.7
Total .......................................................................................................... 47,804 33,504 16,662 34.8

1 Online Survey, Certification and Reporting (OSCAR) database (via PDQ, Provider Summary Table), includes providers considered active at
any time in the fiscal year.
2 Total number does not include Medicaid-only Nursing Facilities.
3 Total includes accredited and non-accredited hospitals, as well as psychiatric hospitals, and critical access hospitals.
Comments: One commenter observed factors in addition to size of the facility. survey varied from 7.6 hours for rural
that, in CMS’ impact analysis and fee We have adopted a relatively health clinics to 22.8 hours for
proposals, CMS chose to include critical straightforward method of calculating hospitals. In comparison, offsite revisit
access hospitals in a single grouping the user fee. If the Congress renews or surveys conducted averaged one and a
with all other hospitals, even though extends the authority to collect the half hours (1.5) across all providers and
section 1861(e) of the Social Security revisit user fee for any considerable time suppliers.
Act states that the term hospital does period, we intend to build into the fee
Fee Schedule for Onsite Revisit Surveys
not include, unless the context schedule a means to take into account
otherwise requires, a critical access facility size and location to the extent We will base the final fee schedule on
hospital (as defined in section that we find such factors make a the average length of time required for
1861(mm)(1)). The commenter stated significant difference in the time and revisit surveys by provider or supplier
that because critical access hospitals are actual cost of the revisits. type in FY 2006. Averages were
typically smaller and less complex calculated separately by type of
organizations than most other hospitals, Frequency and Duration of Revisit provider or supplier, and the hours for
the context clearly does not require their Surveys revisit surveys were separated by either
inclusion with hospitals in this analysis There are many differences across standard health surveys, complaint
and that it would seem that the average providers and suppliers in the surveys, or offsite surveys. A cost of
length of an onsite revisit survey, and frequency and duration of revisit $100 per hour was incurred in FY 2005,
the corresponding assessed fee, would surveys. Skilled nursing facilities/ which was the basis of the cost
be less than that of other hospitals. CMS nursing facilities accounted for 83 estimates in the Continuing Resolution.
should at least present the relevant data percent of total onsite revisit surveys We project that the actual current cost
on critical access hospitals. conducted in FY 2006 following the based on inflation factors and
Response: We included critical access identification of deficiencies from processing expenses is $112 per hour
hospitals in our hospital average fee due standard surveys. Home health agencies and we will use this projected cost in
to their similar functions and surveying accounted for 6 percent of onsite revisit setting the fee schedule. In order to
process. We believe this issue raised by surveys in FY 2006, while ESRDs and obtain this inflation factor, CMS utilized
commenters has merit which will hospitals accounted for 8 percent, 4 FY 2005 annual expenditures derived
require further analysis and we will percent each. Hospice facilities, from CMS–435 form that captures a
consider looking at critical access ambulatory surgical centers, and rural State’s cumulative expenditures and
hospitals in future fee schedules as its health clinics combined comprised the divided this by information obtained
own distinct entities. We agree that remaining 3 percent of revisits. The from CMS–670 form that identifies
revisit time may be affected by many average length of an onsite revisit State’s workload hours or survey hours,
as discussed above. The product of this of Labor, Bureau of Labor Statistics. individual revisit surveys, but will
calculation resulted in dollars per hour Summary of Annual and Semi-Annual assess a flat fee per revisit survey, based
or cost incurred for conducting surveys. Indexes. ONLINE. 2007. Bureau of Labor on provider or supplier type. We expect
CMS then took this number and Statistics. Available: http:// these costs to increase annually to
multiplied this by a composite rate of www.bls.gov/ro3/fax_9125.htm [22 Feb incorporate economic changes, cost of
inflation that was obtained from 2007]. In our fee schedule, the $112 living increases, labor and overhead
percentage change calculations average cost per hour is then multiplied costs expenses if authority for the revisit
identified in annual and semi-annual by the average hours for the revisit fee is continued in the future.
indexes prepared by the U.S. surveys to achieve the average fee cost
Department of Labor’s Consumer Price per onsite revisit survey as identified in All revisit user fees will be assessed
Index for Wage Earners and Clerical Table C below. For the present, we will after publication of this final rule.
Workers (CPI-W). See U.S. Department not adjust fees based on the length of
TABLE C.—REVISIT USER FEE ASSESSMENT BASED ON AVERAGE LENGTH OF ONSITE REVISIT SURVEYS*
Average Fee assessed
length of per revisit
Facility onsite revisit survey
survey (hrs) (hrs × $112)
SNF/NF .................................................................................................................................................................... 18.5 $2,072

Hospitals** ................................................................................................................................................................ 22.8 2,554
HHA ......................................................................................................................................................................... 14.4 1,613
Hospice .................................................................................................................................................................... 15.5 1,736
ASC .......................................................................................................................................................................... 14.9 1,669
RHC ......................................................................................................................................................................... 7.6 851
ESRD ....................................................................................................................................................................... 13.3 1,490
* This includes onsite revisit surveys according to both Standard Health Surveys and Complaint Surveys.
** Transplant center revisits will be charged at the hospital rate.
Proposed Fee Schedule for Offsite surveys in FY 2007 to total schedule notice is proposed and
Revisit Surveys approximately $37.3 million, with published as final.
For offsite revisit surveys, we expect onsite revisit surveys amounting to In Table D below, we provide the
a revisit user fee of $168 assessed approximately $34.6 million and offsite projected quarterly costs based on the
regardless of provider or supplier type. revisit surveys totaling approximately
fee schedule of this final rule. We
Based again on recorded survey time on $2.7 million. However, actual fees
expect the combined costs for all
the CMS–670 form, it was assessed that assessed in FY 2007 will be much less
than this annual amount, since we will providers and suppliers for all onsite
offsite revisit surveys on average take revisit surveys for one quarter to total
one and a half hours (1.5) across all not charge for revisits that occur prior
to publication of this final regulation. approximately $8.6 million. We first
providers and suppliers. We calculated utilized the total number of onsite
the base hourly fee of $112 multiplied The rule will take effect the date of
publication. In order to give maximum revisit surveys for FY 2006, took the
by an average of one and a half hours expected revisit user fees assessed per
to arrive at the $168 fee assessed per consideration to the fiscal impact of the
rule that would occur if it were in force revisits as calculated in Table B above
offsite revisit survey.
All revisit user fees will be assessed for an entire year, we provide here both estimated by provider or supplier and
after publication of this final rule and annual and quarterly estimates of the multiplied this number by the number
fee schedule. impact as listed below in Tables D and of onsite revisit surveys expected for
E. If authority for the revisit user fees is one quarter. We then totaled all
Costs for All Revisit User Fees Assessed continued beyond FY 2007, we will use providers and suppliers to achieve the
We expect the combined costs for all the current fee schedule in this rule for total quarterly costs for all onsite revisit
providers and suppliers for all revisit the assessment of fees until a new fee surveys.
TABLE D.—ESTIMATED QUARTERLY COSTS FOR ONSITE REVISIT SURVEYS

Fee assessed
Number of Number of on- Total costs for
per onsite
onsite revisit site revisit sur- onsite revisit
Facility revisit survey
surveys veys est. for surveys for
(hrs × $112)
(FY 2006) quarter* quarter
(See Table B)
SNF & NF ........................................................................................................ 14,288 $2,072 3,572 $7,401,184

Hospitals .......................................................................................................... 575 2,554 144 367,776
HHA ................................................................................................................. 1,068 1,613 267 430,671
Hospice ............................................................................................................ 256 1,736 64 111,104
ASC .................................................................................................................. 95 1,669 24 40,056
RHC ................................................................................................................. 149 851 37 31,487
ESRD ............................................................................................................... 698 1,490 175 260,750
Total .......................................................................................................... 17,129 ........................ 4,283 8,643,028

*Total number of onsite revisit surveys divided by 4 and rounded up based on FY 2006 actual data.
We expect the combined costs for all the number of offsite revisit surveys providers and suppliers to achieve the
providers and suppliers for all offsite expected for one quarter and multiplied total costs for all offsite revisit surveys
revisit surveys to total $687,960 on a this number by the expected revisit user for one quarter.
quarterly basis. In Table E below, we fee of $168 per offsite revisit survey as
first estimated by provider or supplier discussed above. We then totaled all
TABLE E.—ESTIMATED QUARTERLY COSTS FOR OFFSITE REVISIT SURVEYS

Fee assessed
Number of Number of Total costs for
per offsite
offsite revisit offsite revisit offsite revisit
Facility revisit survey
surveys surveys est. surveys for
($112 × 1.5
(FY 2006) for quarter* quarter
hrs)
SNF & NF ........................................................................................................ 15,138 $168 3,785 $635,880

Hospitals .......................................................................................................... 278 168 70 11,760
HHA ................................................................................................................. 517 168 129 21,672
Hospice ............................................................................................................ 51 168 13 2,184
ASC .................................................................................................................. 93 168 23 3,864
RHC ................................................................................................................. 67 168 17 2,856
ESRD ............................................................................................................... 231 168 58 9,744
Total .......................................................................................................... 16,375 ........................ 4,095 687,960

*Total number of offsite revisit surveys divided by 4 and rounded up based on FY 2006 actual data.
As shown in Table F below, we as well as the costs we would expect to entire last quarter of FY 2007 or an
provide the total costs expected had the offset in the final quarter of the fiscal entire quarter in the future.
rule been in effect for an entire FY 2007, year if the rule were in effect for the
TABLE F.—TOTAL COSTS COMBINED FOR ALL REVISIT SURVEYS PER FISCAL YEAR & QUARTER
FY 2007 One quarter*
Onsite Revisit Surveys ............................................................................................................................................ $34,565,760 $8,643,028

Offsite Revisit Surveys ............................................................................................................................................ 2,751,000 687,960
Total Costs All Revisits .................................................................................................................................... 37,316,760 9,330,988

*One quarter’s costs are based on quarterly revisit surveys rounded up to the nearest whole number as shown in Tables D & E; multiplying
Table F last quarter numbers in column 2 by 4 would create a slightly larger cost than identified in FY 2007 column 1 above.
As discussed above, we have more frequently in order to avoid the deficiencies or deficiencies of greater
excluded Medicaid-only facilities (such assessment of a fee. severity may take more revisit time.
as Intermediate Care Facilities for the We received a wide variety of Under the current design in this rule,
mentally Retarded (ICFs/MR)), comments on the discussion of the many providers will pay no fees because
comprehensive outpatient rehabilitation impact of this rule on providers and they consistently provide high quality
facilities, providers of outpatient suppliers and we have summarized care, have no deficiencies identified
physical therapy or speech pathology these comments below. through the survey process, and
services, independent laboratories, therefore will require no revisits. Other
1. Unfairness in Charging Same Fees
portable x-ray centers, physical providers may require some revisits but
therapists in independent practice, Comments: A commenter stated that it with minimal costs because the
federally qualified health centers, is unfair to charge the same revisit fee, deficiencies are not serious, and the
chiropractors, Religious nonmedical regardless of the seriousness or number revisit may be accomplished through an
health care institutions (RNHCIs) in all of deficiencies. offsite revisit survey. We have
proposed rate-setting calculations. Response: We appreciate the established a much lower fee for offsite
commenters’ implicit suggestion that revisit surveys since actual costs to the
We also expect that the revisit user fee the amount of the revisit fee should be survey program for offsite revisit
will have some effect in motivating scaled to reflect differences in the surveys are much less than the costs for
providers and suppliers to improve number and seriousness of the onsite revisit surveys, and the user fee
quality, or if quality problems do occur, deficiencies identified. This rule is intended only to recoup average
to ensure that quality lapses are provides the basis to take such factors actual costs. We believe we have
corrected more quickly than in the past. into greater account in the future. If the designed the user fee program to result
Both of these positive effects would Congress renews or extends the user fee in a positive correlation between quality
result in fewer revisit surveys being authority beyond FY 2007, we plan to of care and amount of the fees—the
necessary. However, CMS does examine this idea in more depth and act better the quality of care, the lower the
acknowledge that the revisit user fee on it if it is determined to be feasible fees. We also expect that the prospect of
may have a counter effect of prompting and correlated well with actual revisit fees for revisits will promote greater
long-term care facilities to engage in the cost. In the fee schedule in this final compliance with federal quality of care
informal dispute resolution process to rule we take some small steps in the requirements, thereby making for fewer
dispute State survey agency decisions direction of acknowledging that more revisits and fewer fees over time.
2. Equalized Rate State cost of the surveyor, plus limited this time, CMS has determined to charge
Comments: A few commenters noted overhead. This would help ensure that an average fee per provider type, but
that North Dakota is an equalized rate the fees will not exceed actual cost and will consider changing the fee schedule
state, meaning that nursing homes will be specific to the level of effort in the future to account for differences
cannot charge a per diem rate for private involved in the visit. among particular providers.
pay residents that exceed the per diem Response: We disagree. CMS does use
4. Fees Are Excessive
rate that Medicaid pays. Revenues are a national average actual cost per hour
limited and funds could be better spent (surveyors salaries, associated Comment: A few commenters felt that
to improve the quality of care. overheads and miscellaneous costs for the size of the fee was excessive.
Response: In North Dakota nursing travel, office space and equipment Response: The size of the revisit fee
homes are the only Medicaid providers rentals, etc.) in calculating the average is sufficient to cover the costs that state
mandated to have equalization of rates. hours and costs for each provider type; survey agencies incur in conducting the
Equalization of rates means nursing Skilled Nursing Homes, HHA, Hospice, surveys. We do not believe that the
facilities are prohibited from charging etc. revisits. However, we use average amount of the revisit user fee will be
private paying residents more than the costs per provider type and do not very significant except for those
rate set by Medicaid. Medicaid controls individualize the fee to the exact providers that have a persistent problem
and sets the rate for all nursing home number of revisit hours for any one sustaining compliance with federal
residents except the 5 percent provider, since we judge such extremely requirements and may have many
controlled by Medicare. The legislature specific pricing to be so revisits as a result. CMS’s expectation is
sets the rate equal to the equalization administratively expensive at this point that all providers remain in compliance
rate. This final rule will only apply to in time that it would detract with federal regulations at all times.
Medicare providers and suppliers and to significantly from the fiscal benefits of These federal regulations establish
dually-participating nursing facilities. the revisit user fee. minimally acceptable standards. The
Comment: A few commenters argued
3. Charges Should Not Be Based on user fee will cover the costs that the
that fees should reflect the actual cost of
Averages state agency incurs in ensuring that
conducting each providers survey,
violations of federal regulations have
Comment: A commenter felt that, rather than being based on national
been corrected. The correction of many
rather than charging on an average fee average costs for each type of provider.
minor deficiencies can be evaluated by
basis by provider type, the charges Response: We recognize that there are
an offsite revisit survey, which will
should be based on the specific number differences among States and among
result in a nominal charge.
of hours required to do the onsite visit particular facilities that lead to different
and be based on the actual hourly salary costs of conducting revisit surveys. At C. Final Fee Schedule
Fee assessed Fee assessed

Facility per offsite per onsite
revisit survey revisit survey
SNF & NF ................................................................................................................................................................ $168 $2,072

Hospitals .................................................................................................................................................................. 168 2,554
HHA ......................................................................................................................................................................... 168 1,613
Hospice .................................................................................................................................................................... 168 1,736
ASC .......................................................................................................................................................................... 168 1,669
RHC ......................................................................................................................................................................... 168 851
ESRD ....................................................................................................................................................................... 168 1,490
D. Alternatives Considered health agencies, hospices, skilled Quality Improvement Organizations

The revisit user fee in the Continuing nursing facilities/nursing facilities, and (QIOs) to educate providers and
Resolution addresses important resource other large accreditation organizations. suppliers on best practices and
issues in the Medicare survey and CMS staff speaks to new developments expectations for meeting Federal health
certification programming budget. To within survey and certification policy, and safety requirements. Despite these
implement this revisit user fee process, updating of regulations, and efforts, there continue to be many
CMS is required to promulgate a expectations that CMS has for those providers and suppliers that fail to meet
proposed regulation and proposed fee providing services to its Medicare Medicare conditions of participation,
schedule. CMS has attempted through a beneficiaries. CMS in its continued conditions for coverage or requirements
variety of methods to encourage ways of outreach and educational efforts and require revisit surveys to ensure
providers and suppliers to improve surrounding health and safety compliance with Federal quality of care
quality and thus decrease the need to requirements regularly posts and shares requirements. In addition, costs for
conduct revisit surveys for deficiencies any modification of policies or program these revisits continue to increase. CMS
cited prior to the inclusion of a revisit on its CMS survey and certification Web believes that the assessment of revisit
user fee included in the FY 2007 site and through its survey and user fees, as directed in the Continuing
Continuing Resolution. CMS continues certification online course delivery Resolution, is a piece of the larger
to conduct outreach and educational systems. See U.S. Centers for Medicare efforts to address health care providers
efforts, quality analysis studies, and & Medicaid Services. ‘‘Certification & and suppliers that have failed to comply
with Federal quality of care
review of current regulatory Compliance.’’ ONLINE. 2007. CMS.

requirements to focus in on health and Available: http://www.cms.hhs.gov/ requirements.
safety measures. In its outreach efforts, SurveyCertificationEnforcement/ In accordance with Executive Order
CMS staff continues to present at trade 01_Overview.asp. CMS also devoted a 12866, this rule has been reviewed by
association meetings representing home substantial part of the work of the the Office of Management and Budget.
List of Subjects (42 U.S.C. 1302 and 1395(hh)); Pub.L. 110– (c) Fee schedule. CMS must publish
5, H.J. Res. 20, § 20615(b)(2007). in the Federal Register the proposed
42 CFR Part 424
and final notices of a uniform fee
Emergency medical services, Health Subpart A—General Provisions schedule before it assesses revised
facilities, Health professions, Medicare, revisit user fees. The notices must set
Reporting and recordkeeping ■ 2. Part 488, subpart A is amended by forth which criteria will be used and
requirements. adding a new § 488.30 to read as how, as well as the amounts of the
follows: assessed fees based on the criteria as
42 CFR Part 488
§ 488.30 Revisit user fee for revisit identified in paragraph (b) of this
Administrative practice and surveys. subpart.
procedure, Health facilities, Medicare, (d) Collection of fees.
Reporting and recordkeeping (a) Definitions. As used in this (1) Fees for revisit surveys under this
requirements. section, the following definitions apply: section may be deducted from amounts
Certification (both initial and otherwise payable to the provider or
42 CFR Part 489 recertification) means those activities as supplier. As they are collected, fees will
Health facilities, Medicare, Reporting defined in § 488.1. be deposited as an offset collection to be
and recordkeeping requirements. Complaint surveys means those used exclusively for survey and
surveys conducted on the basis of a certification activities conducted by
■ For the reasons set forth in the
substantial allegation of noncompliance, State survey agencies pursuant to
preamble, the Centers for Medicare &
as defined in § 488.1. section 1864 of the Act or by CMS, and
Medicaid Services amends 42 CFR Provider of services, provider, or will be available for CMS until
Chapter IV, parts 424, 488, and 489 as supplier has the meaning defined in expended. CMS may devise other
set forth below: § 488.1, and ambulatory surgical collection methods as it deems
PART 424—CONDITIONS FOR centers, transplant centers, and religious appropriate. In determining these
MEDICARE PAYMENT nonmedical health care institutions methods, CMS will consider efficiency,
subject to § 416.2, § 482.70, and effectiveness, and convenience for the
■ 1. The authority citation for part 424 § 403.702 [C8] of this chapter, providers, suppliers, and CMS. CMS
continues to read as follows: respectively, will be subject to user fees may consider any method allowed by
Authority: Secs. 1102 and 1871 of the unless otherwise exempted. law, including: Credit card; electronic
Social Security Act, unless otherwise noted Revisit survey means a survey
fund transfer; check; money order; and
(42 U.S.C. 1302 and 1395hh). performed with respect to a provider or
offset collections from claims submitted.
supplier cited for deficiencies during an (2) Fees for revisit surveys under this
Subpart P—Requirements for initial certification, recertification, or section are not allowable items on a cost
Establishing and Maintaining Medicare substantiated complaint survey and that report, as identified in part 413, subpart
Billing Privileges is designed to evaluate the extent to B of this chapter, under title XVIII of the
which previously-cited deficiencies Act.
■ 2. Section 424.535 is amended by have been corrected and the provider or (3) Fees for revisit surveys will be due
revising paragraph (a)(1) introductory supplier is in substantial compliance for any revisit surveys conducted during
text to read as follows: with applicable conditions of the time period for which authority to
participation, requirements, or levy a revisit user fee exists.
§ 424.535 Revocation of enrollment and conditions for coverage. Revisit surveys
billing privileges in the Medicare program. (e) Reconsideration process for revisit
include both offsite and onsite review. user fees.
(a) * * * Substantiated complaint survey (1) CMS will review a request for
(1) Noncompliance. The provider or means a complaint survey that results in reconsideration of an assessed revisit
supplier is determined not to be in the proof or finding of noncompliance at user fee—
compliance with the enrollment the time of the survey, a finding that (i) If a provider or supplier believes an
requirements described in this section, noncompliance was proven to exist, but error of fact has been made in the
or in the enrollment application was corrected prior to the survey, and application of the revisit user fee, such
applicable for its provider or supplier includes any deficiency that is cited as clerical errors, billing for a fee
type, and has not submitted a plan of during a complaint survey, whether or already paid, or assessment of a fee
corrective action as outlined in part 488 not the cited deficiency was the original when there was no revisit conducted,
of this chapter. The provider or supplier subject of the complaint. and
may also be determined not to be in (b) Criteria for determining the fee. (ii) If the request for reconsideration
compliance if it has failed to pay any (1) The provider or supplier will be is received by CMS within 14 calendar
user fees as assessed under part 488 of assessed a revisit user fee based upon days from the date identified on the
this chapter. All providers and suppliers one or more of the following: revisit user fee assessment notice.
are granted an opportunity to correct the (i) The average cost per provider or (2) CMS will issue a credit toward any
deficient compliance requirement before supplier type. future revisit surveys conducted, if the
a final determination to revoke billing (ii) The type of revisit survey provider or supplier has remitted an
privileges. conducted (onsite or offsite). assessed revisit user fee and for which
* * * * * (iii) The size of the provider or a reconsideration request is found in
supplier. favor of the provider or supplier. If in
PART 488—SURVEY, CERTIFICATION, (iv) The number of follow-up revisits the event that CMS judges that a
AND ENFORCEMENT PROCEDURES resulting from uncorrected deficiencies. significant amount of time has elapsed
(v) The seriousness and number of before such a credit is used, CMS will
■ 1. The authority citation for part 488 deficiencies. refund the assessed revisit user fee
is revised to read as follows: (2) CMS may adjust the fees to amount paid to the provider or supplier.
Authority: Secs. 1102 and 1871 of the account for any regional differences in (3) CMS will not reconsider the
Social Security Act, unless otherwise noted cost. assessment of revisit user fees that
request reconsideration of the survey Authority: Secs. 1102, 1819, 1861, (16) It has failed to pay a revisit user
findings or deficiency citations that may 1864(m), 1866, 1869, and 1871 of the Social fee when and if assessed.
have given rise to the revisit, the revisit Security Act, 42 U.S.C. 1302, 1395i–3, 1395x,
1395aa(m), 1395cc, 1395ff, and 1395hh). * * * * *
findings, the need for the revisit itself,
or other similarly identified basis for the (Catalog of Federal Domestic Assistance
assessment of the revisit user fee. Subpart B—Essentials of Provider Program No. 93.778, Medical Assistance
(f) Enforcement. If the full revisit user Agreements Program) (Catalog of Federal Domestic
fee payment is not received within 30 Assistance Program No. 93.773, Medicare—
calendar days from the date identified ■ 4. Section 489.20 is amended by Hospital Insurance; and Program No. 93.774,
on the revisit user fee assessment notice, adding a new paragraph (w) to read as Medicare—Supplementary Medical
CMS may terminate the facility’s follows: Insurance Program)
provider agreement (pursuant to Dated: September 7, 2007.
§ 489.53(a)(16) of this chapter) and § 489.20 Basic commitments.
Kerry Weems,
enrollment in the Medicare program or * * * * *
Acting Administrator, Centers for Medicare
the supplier’s enrollment and (w) To comply with § 488.30 of this & Medicaid Services.
participation in the Medicare program chapter, to pay revisit user fees when
(pursuant to § 424.535(a)(1) of this Approved: September 12, 2007.
and if assessed.
chapter). Michael O. Leavitt,
■ 5. Section 489.53 is amended by
Secretary.
PART 489—PROVIDER AGREEMENTS adding a new paragraph (a)(16) to read
as follows: [FR Doc. E7–18458 Filed 9–18–07; 8:45 am]
AND SUPPLIER APPROVAL
BILLING CODE 4120–01–P
§ 489.53 Termination by CMS.
■ 3. The authority citation for part 489
continues to read as follows: (a) * * *

Rule: Medicare: Revisit User Fee Program Medicare Survey and Certification Activities

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Rule: Medicare: Revisit User Fee Program Medicare Survey and Certification Activities

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Wednesday,

September 19, 2007

42 CFR Parts 424, 488, and 489

certifications since it can take 2 or more is required as a result of the situation,

TABLE A.—FINAL FEE SCHEDULE FOR REVISITS SURVEYS

Fee assessed Fee assessed

SNF & NF ........................................................................................................................................................ $168 $2,072

be remitted within 30 calendar days of

SNF/NF 2 .......................................................................................................... 15,172 29,426 13,350 87.9

Total .......................................................................................................... 47,804 33,504 16,662 34.8

SNF/NF .................................................................................................................................................................... 18.5 $2,072

TABLE D.—ESTIMATED QUARTERLY COSTS FOR ONSITE REVISIT SURVEYS

SNF & NF ........................................................................................................ 14,288 $2,072 3,572 $7,401,184

ESRD ............................................................................................................... 698 1,490 175 260,750

Total .......................................................................................................... 17,129 ........................ 4,283 8,643,028

TABLE E.—ESTIMATED QUARTERLY COSTS FOR OFFSITE REVISIT SURVEYS

SNF & NF ........................................................................................................ 15,138 $168 3,785 $635,880

Total .......................................................................................................... 16,375 ........................ 4,095 687,960

Onsite Revisit Surveys ............................................................................................................................................ $34,565,760 $8,643,028

Total Costs All Revisits .................................................................................................................................... 37,316,760 9,330,988

Fee assessed Fee assessed

SNF & NF ................................................................................................................................................................ $168 $2,072

D. Alternatives Considered health agencies, hospices, skilled Quality Improvement Organizations

review of current regulatory Compliance.’’ ONLINE. 2007. CMS.

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