[Title 42 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 2009 Edition]
[From the U.S. Government Printing Office]



[[Page i]]

          

          42


          Part 482 to End

          Revised as of October 1, 2009


          Public Health
          



________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of October 1, 2009
          With Ancillaries
                    Published by
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register

[[Page ii]]

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[[Page iii]]







As of October 1, 2009

Title 42, Part 430 to End

Revised as of October 1, 2008

Is Replaced by

Title 40, Parts 430 to 481

and

Title 42, Part 482 to End



[[Page v]]





                            Table of Contents



                                                                    Page
  Explanation.................................................     vii

  Title 42:
          Chapter IV--Centers for Medicare & Medicaid 
          Services, Department of Health and Human Services 
          (Continued)                                                3
          Chapter V--Office of Inspector General-Health Care, 
          Department of Health and Human Services                  665
  Finding Aids:
      Table of CFR Titles and Chapters........................     771
      Alphabetical List of Agencies Appearing in the CFR......     791
      Table of OMB Control Numbers............................     801
      List of CFR Sections Affected...........................     803

[[Page vi]]





                     ----------------------------

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 42 CFR 482.1 refers 
                       to title 42, part 482, 
                       section 1.

                     ----------------------------

[[Page vii]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
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parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
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HOW TO USE THE CODE OF FEDERAL REGULATIONS

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[[Page viii]]

Many agencies have begun publishing numerous OMB control numbers as 
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the revision dates of the 50 CFR titles.




[[Page ix]]



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    Raymond A. Mosley,
    Director,
    Office of the Federal Register.
    October 1, 2009.







[[Page xi]]



                               THIS TITLE

    Title 42--Public Health is composed of five volumes. The parts in 
these volumes are arranged in the following order: Parts 1-399, parts 
400-413, parts 414-429, parts 430 to 481, and part 482 to end. The first 
volume (parts 1-399) contains current regulations issued under chapter 
I--Public Health Service (HHS). The second, third, and fourth volumes 
(parts 400-413, parts 414-429, and parts 430 to 481) include regulations 
issued under chapter IV--Centers for Medicare & Medicaid Services (HHS) 
and the fifth volume (part 482 to end) contains the remaining 
regulations in chapter IV and the regulations issued under chapter V by 
the Office of Inspector General-Health Care (HHS). The contents of these 
volumes represent all current regulations codified under this title of 
the CFR as of October 1, 2009.

    The OMB control numbers for the Centers for Medicare & Medicaid 
Services appear in Sec.  400.310 of chapter IV. For the convenience of 
the user, subpart C consisting of Sec. Sec.  400.300-400.310 is 
reprinted in the Finding Aids section of the third, fourth and fifth 
volumes.

    For this volume, Jonn V. Lilyea was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Michael L. White, assisted by Ann Worley.


[[Page 1]]



                         TITLE 42--PUBLIC HEALTH




                            (Part 482 to End)

  --------------------------------------------------------------------
                                                                    Part

chapter iv--Centers for Medicare & Medicaid Services, 
  Department of Health and Human Services (Continued).......         482

chapter v--Office of Inspector General-Health Care, 
  Department of Health and Human Services...................        1000

[[Page 3]]



  CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF 
                  HEALTH AND HUMAN SERVICES (CONTINUED)




  --------------------------------------------------------------------


  Editorial Note: Nomenclature changes to chapter IV appear at 66 FR 
39452, July 31, 2001; 67 FR 36540, May 24, 2002; and 69 FR 18803, Apr. 
9, 2004.

                SUBCHAPTER G--STANDARDS AND CERTIFICATION
Part                                                                Page
482             Conditions of participation for hospitals...           5
483             Requirements for States and long term care 
                    facilities..............................          40
484             Home health services........................         110
485             Conditions of participation: Specialized 
                    providers...............................         131
486             Conditions for coverage of specialized 
                    services furnished by suppliers.........         160
488             Survey, certification, and enforcement 
                    procedures..............................         179
489             Provider agreements and supplier approval...         469
491             Certification of certain health facilities..         500
493             Laboratory requirements.....................         506
494             Conditions for coverage for end-stage renal 
                    disease facilities......................         627
498             Appeals procedures for determinations that 
                    affect participation in the Medicare 
                    program and for determinations that 
                    affect the participation of ICFs/MR and 
                    certain NFs in the Medicaid program.....         643
      SUBCHAPTER H--HEALTH CARE INFRASTRUCTURE IMPROVEMENT PROGRAM
505             Establishment of the health care 
                    infrastructure improvement program......         660

[[Page 5]]



                SUBCHAPTER G_STANDARDS AND CERTIFICATION





PART 482_CONDITIONS OF PARTICIPATION FOR HOSPITALS--Table of Contents




                      Subpart A_General Provisions

Sec.
482.1 Basis and scope.
482.2 Provision of emergency services by nonparticipating hospitals.

                        Subpart B_Administration

482.11 Condition of participation: Compliance with Federal, State and 
          local laws.
482.12 Condition of participation: Governing body.
482.13 Condition of participation: Patient's rights.

                   Subpart C_Basic Hospital Functions

482.21 Condition of participation: Quality assessment and performance 
          improvement program.
482.22 Condition of participation: Medical staff.
482.23 Condition of participation: Nursing services.
482.24 Condition of participation: Medical record services.
482.25 Condition of participation: Pharmaceutical services.
482.26 Condition of participation: Radiologic services.
482.27 Condition of participation: Laboratory services.
482.28 Condition of participation: Food and dietetic services.
482.30 Condition of participation: Utilization review.
482.41 Condition of participation: Physical environment.
482.42 Condition of participation: Infection control.
482.43 Condition of participation: Discharge planning.
482.45 Condition of participation: Organ, tissue, and eye procurement.

                  Subpart D_Optional Hospital Services

482.51 Condition of participation: Surgical services.
482.52 Condition of participation: Anesthesia services.
482.53 Condition of participation: Nuclear medicine services.
482.54 Condition of participation: Outpatient services.
482.55 Condition of participation: Emergency services.
482.56 Condition of participation: Rehabilitation services.
482.57 Condition of participation: Respiratory care services.

             Subpart E_Requirements for Specialty Hospitals

482.60 Special provisions applying to psychiatric hospitals.
482.61 Condition of participation: Special medical record requirements 
          for psychiatric hospitals.
482.62 Condition of participation: Special staff requirements for 
          psychiatric hospitals.
482.66 Special requirements for hospital providers of long-term care 
          services (``swing-beds'').
482.68 Special requirements for transplant centers.
482.70 Definitions.

               General Requirements for Transplant Centers

482.72 Condition of participation: OPTN Membership.
482.74 Condition of participation: Notification to CMS.
482.76 Condition of participation: Pediatric Transplants.

  Transplant Center Data Submission, Clinical Experience, and Outcome 
                              Requirements

482.80 Condition of participation: Data submission, clinical experience, 
          and outcome requirements for initial approval of transplant 
          centers.
482.82 Condition of participation: Data submission, clinical experience, 
          and outcome requirements for re-approval of transplant 
          centers.

                 Transplant Center Process Requirements

482.90 Condition of participation: Patient and living donor selection.
482.92 Condition of participation: Organ recovery and receipt.
482.94 Condition of participation: Patient and living donor management.
482.96 Condition of participation: Quality assessment and performance 
          improvement (QAPI).
482.98 Condition of participation: Human resources.
482.100 Condition of participation: Organ procurement.
482.102 Condition of participation: Patient and living donor rights.
482.104 Condition of participation: Additional requirements for kidney 
          transplant centers.


[[Page 6]]


    Authority: Secs. 1102, 1871 and 1881 of the Social Security Act (42 
U.S.C. 1302, 1395hh, and 1395rr), unless otherwise noted.

    Source: 51 FR 22042, June 17, 1986, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  482.1  Basis and scope.

    (a) Statutory basis. (1) Section 1861(e) of the Act provides that--
    (i) Hospitals participating in Medicare must meet certain specified 
requirements; and
    (ii) The Secretary may impose additional requirements if they are 
found necessary in the interest of the health and safety of the 
individuals who are furnished services in hospitals.
    (2) Section 1861(f) of the Act provides that an institution 
participating in Medicare as a psychiatric hospital must meet certain 
specified requirements imposed on hospitals under section 1861(e), must 
be primarily engaged in providing, by or under the supervision of a 
physician, psychiatric services for the diagnosis and treatment of 
mentally ill persons, must maintain clinical records and other records 
that the Secretary finds necessary, and must meet staffing requirements 
that the Secretary finds necessary to carry out an active program of 
treatment for individuals who are furnished services in the hospital. A 
distinct part of an institution can participate as a psychiatric 
hospital if the institution meets the specified 1861(e) requirements and 
is primarily engaged in providing psychiatric services, and if the 
distinct part meets the records and staffing requirements that the 
Secretary finds necessary.
    (3) Sections 1861(k) and 1902(a)(30) of the Act provide that 
hospitals participating in Medicare and Medicaid must have a utilization 
review plan that meets specified requirements.
    (4) Section 1883 of the Act sets forth the requirements for 
hospitals that provide long term care under an agreement with the 
Secretary.
    (5) Section 1905(a) of the Act provides that ``medical assistance'' 
(Medicaid) payments may be applied to various hospital services. 
Regulations interpreting those provisions specify that hospitals 
receiving payment under Medicaid must meet the requirements for 
participation in Medicare (except in the case of medical supervision of 
nurse-midwife services. See Sec. Sec.  440.10 and 440.165 of this 
chapter.).
    (b) Scope. Except as provided in subpart A of part 488 of this 
chapter, the provisions of this part serve as the basis of survey 
activities for the purpose of determining whether a hospital qualifies 
for a provider agreement under Medicare and Medicaid.

[51 FR 22042, June 17, 1986, as amended at 60 FR 50442, Sept. 29, 1995]



Sec.  482.2  Provision of emergency services by nonparticipating hospitals.

    (a) The services of an institution that does not have an agreement 
to participate in the Medicare program may, nevertheless, be reimbursed 
under the program if--
    (1) The services are emergency services; and
    (2) The institution meets the requirements of section 1861(e) (1) 
through (5) and (7) of the Act. Rules applicable to emergency services 
furnished by nonparticipating hospitals are set forth in subpart G of 
part 424 of this chapter.
    (b) Section 440.170(e) of this chapter defines emergency hospital 
services for purposes of Medicaid reimbursement.

[51 FR 22042, June 17, 1986, as amended at 53 FR 6648, Mar. 2, 1988]



                        Subpart B_Administration



Sec.  482.11  Condition of participation: Compliance with Federal, State and local laws.

    (a) The hospital must be in compliance with applicable Federal laws 
related to the health and safety of patients.
    (b) The hospital must be--
    (1) Licensed; or
    (2) Approved as meeting standards for licensing established by the 
agency of the State or locality responsible for licensing hospitals.
    (c) The hospital must assure that personnel are licensed or meet 
other applicable standards that are required by State or local laws.

[[Page 7]]



Sec.  482.12  Condition of participation: Governing body.

    The hospital must have an effective governing body legally 
responsible for the conduct of the hospital as an institution. If a 
hospital does not have an organized governing body, the persons legally 
responsible for the conduct of the hospital must carry out the functions 
specified in this part that pertain to the governing body.
    (a) Standard: Medical staff. The governing body must:
    (1) Determine, in accordance with State law, which categories of 
practitioners are eligible candidates for appointment to the medical 
staff;
    (2) Appoint members of the medical staff after considering the 
recommendations of the existing members of the medical staff;
    (3) Assure that the medical staff has bylaws;
    (4) Approve medical staff bylaws and other medical staff rules and 
regulations;
    (5) Ensure that the medical staff is accountable to the governing 
body for the quality of care provided to patients;
    (6) Ensure the criteria for selection are individual character, 
competence, training, experience, and judgment; and
    (7) Ensure that under no circumstances is the accordance of staff 
membership or professional privileges in the hospital dependent solely 
upon certification, fellowship, or membership in a specialty body or 
society.
    (b) Standard: Chief executive officer. The governing body must 
appoint a chief executive officer who is responsible for managing the 
hospital.
    (c) Standard: Care of patients. In accordance with hospital policy, 
the governing body must ensure that the following requirements are met:
    (1) Every Medicare patient is under the care of:
    (i) A doctor of medicine or osteopathy (This provision is not to be 
construed to limit the authority of a doctor of medicine or osteopathy 
to delegate tasks to other qualified health care personnel to the extent 
recognized under State law or a State's regulatory mechanism.);
    (ii) A doctor of dental surgery or dental medicine who is legally 
authorized to practice dentistry by the State and who is acting within 
the scope of his or her license;
    (iii) A doctor of podiatric medicine, but only with respect to 
functions which he or she is legally authorized by the State to perform;
    (iv) A doctor of optometry who is legally authorized to practice 
optometry by the State in which he or she practices;
    (v) A chiropractor who is licensed by the State or legally 
authorized to perform the services of a chiropractor, but only with 
respect to treatment by means of manual manipulation of the spine to 
correct a subluxation demonstrated by x-ray to exist; and
    (vi) A clinical psychologist as defined in Sec.  410.71 of this 
chapter, but only with respect to clinical psychologist services as 
defined in Sec.  410.71 of this chapter and only to the extent permitted 
by State law.
    (2) Patients are admitted to the hospital only on the recommendation 
of a licensed practitioner permitted by the State to admit patients to a 
hospital. If a Medicare patient is admitted by a practitioner not 
specified in paragraph (c)(1) of this section, that patient is under the 
care of a doctor of medicine or osteopathy.
    (3) A doctor of medicine or osteopathy is on duty or on call at all 
times.
    (4) A doctor of medicine or osteopathy is responsible for the care 
of each Medicare patient with respect to any medical or psychiatric 
problem that--
    (i) is present on admission or develops during hospitalization; and
    (ii) Is not specifically within the scope of practice of a doctor of 
dental surgery, dental medicine, podiatric medicine, or optometry; a 
chiropractor; or clinical psychologist, as that scope is--
    (A) Defined by the medical staff;
    (B) Permitted by State law; and
    (C) Limited, under paragraph (c)(1)(v) of this section, with respect 
to chiropractors.
    (d) Standard: Institutional plan and budget. The institution must 
have an overall institutional plan that meets the following conditions:

[[Page 8]]

    (1) The plan must include an annual operating budget that is 
prepared according to generally accepted accounting principles.
    (2) The budget must include all anticipated income and expenses. 
This provision does not require that the budget identify item by item 
the components of each anticipated income or expense.
    (3) The plan must provide for capital expenditures for at least a 3-
year period, including the year in which the operating budget specified 
in paragraph (d)(2) of this section is applicable.
    (4) The plan must include and identify in detail the objective of, 
and the anticipated sources of financing for, each anticipated capital 
expenditure in excess of $600,000 (or a lesser amount that is 
established, in accordance with section 1122(g)(1) of the Act, by the 
State in which the hospital is located) that relates to any of the 
following:
    (i) Acquisition of land;
    (ii) Improvement of land, buildings, and equipment; or
    (iii) The replacement, modernization, and expansion of buildings and 
equipment.
    (5) The plan must be submitted for review to the planning agency 
designated in accordance with section 1122(b) of the Act, or if an 
agency is not designated, to the appropriate health planning agency in 
the State. (See part 100 of this title.) A capital expenditure is not 
subject to section 1122 review if 75 percent of the health care 
facility's patients who are expected to use the service for which the 
capital expenditure is made are individuals enrolled in a health 
maintenance organization (HMO) or competitive medical plan (CMP) that 
meets the requirements of section 1876(b) of the Act, and if the 
Department determines that the capital expenditure is for services and 
facilities that are needed by the HMO or CMP in order to operate 
efficiently and economically and that are not otherwise readily 
accessible to the HMO or CMP because--
    (i) The facilities do not provide common services at the same site;
    (ii) The facilities are not available under a contract of reasonable 
duration;
    (iii) Full and equal medical staff privileges in the facilities are 
not available;
    (iv) Arrangements with these facilities are not administratively 
feasible; or
    (v) The purchase of these services is more costly than if the HMO or 
CMP provided the services directly.
    (6) The plan must be reviewed and updated annually.
    (7) The plan must be prepared--
    (i) Under the direction of the governing body; and
    (ii) By a committee consisting of representatives of the governing 
body, the administrative staff, and the medical staff of the 
institution.
    (e) Standard: Contracted services. The governing body must be 
responsible for services furnished in the hospital whether or not they 
are furnished under contracts. The governing body must ensure that a 
contractor of services (including one for shared services and joint 
ventures) furnishes services that permit the hospital to comply with all 
applicable conditions of participation and standards for the contracted 
services.
    (1) The governing body must ensure that the services performed under 
a contract are provided in a safe and effective manner.
    (2) The hospital must maintain a list of all contracted services, 
including the scope and nature of the services provided.
    (f) Standard: Emergency services. (1) If emergency services are 
provided at the hospital, the hospital must comply with the requirements 
of Sec.  482.55.
    (2) If emergency services are not provided at the hospital, the 
governing body must assure that the medical staff has written policies 
and procedures for appraisal of emergencies, initial treatment, and 
referral when appropriate.
    (3) If emergency services are provided at the hospital but are not 
provided at one or more off-campus departments of the hospital, the 
governing body of the hospital must assure that the medical staff has 
written policies and procedures in effect with respect to the off-campus 
department(s) for appraisal of

[[Page 9]]

emergencies and referral when appropriate.

[51 FR 22042, June 17, 1986; 51 FR 27847, Aug. 4, 1986, as amended at 53 
FR 6549, Mar. 1, 1988; 53 FR 18987, May 26, 1988; 56 FR 8852, Mar. 1, 
1991; 56 FR 23022, May 20, 1991; 59 FR 46514, Sept. 8, 1994; 63 FR 
20130, Apr. 23, 1998; 63 FR 33874, June 22, 1998; 68 FR 53262, Sept. 9, 
2003]



Sec.  482.13  Condition of participation: Patient's rights.

    A hospital must protect and promote each patient's rights.
    (a) Standard: Notice of rights--(1) A hospital must inform each 
patient, or when appropriate, the patient's representative (as allowed 
under State law), of the patient's rights, in advance of furnishing or 
discontinuing patient care whenever possible.
    (2) The hospital must establish a process for prompt resolution of 
patient grievances and must inform each patient whom to contact to file 
a grievance. The hospital's governing body must approve and be 
responsible for the effective operation of the grievance process and 
must review and resolve grievances, unless it delegates the 
responsibility in writing to a grievance committee. The grievance 
process must include a mechanism for timely referral of patient concerns 
regarding quality of care or premature discharge to the appropriate 
Utilization and Quality Control Quality Improvement Organization. At a 
minimum:
    (i) The hospital must establish a clearly explained procedure for 
the submission of a patient's written or verbal grievance to the 
hospital.
    (ii) The grievance process must specify time frames for review of 
the grievance and the provision of a response.
    (iii) In its resolution of the grievance, the hospital must provide 
the patient with written notice of its decision that contains the name 
of the hospital contact person, the steps taken on behalf of the patient 
to investigate the grievance, the results of the grievance process, and 
the date of completion.
    (b) Standard: Exercise of rights. (1) The patient has the right to 
participate in the development and implementation of his or her plan of 
care.
    (2) The patient or his or her representative (as allowed under State 
law) has the right to make informed decisions regarding his or her care. 
The patient's rights include being informed of his or her health status, 
being involved in care planning and treatment, and being able to request 
or refuse treatment. This right must not be construed as a mechanism to 
demand the provision of treatment or services deemed medically 
unnecessary or inappropriate.
    (3) The patient has the right to formulate advance directives and to 
have hospital staff and practitioners who provide care in the hospital 
comply with these directives, in accordance with Sec.  489.100 of this 
part (Definition), Sec.  489.102 of this part (Requirements for 
providers), and Sec.  489.104 of this part (Effective dates).
    (4) The patient has the right to have a family member or 
representative of his or her choice and his or her own physician 
notified promptly of his or her admission to the hospital.
    (c) Standard: Privacy and safety. (1) The patient has the right to 
personal privacy.
    (2) The patient has the right to receive care in a safe setting.
    (3) The patient has the right to be free from all forms of abuse or 
harassment.
    (d) Standard: Confidentiality of patient records. (1) The patient 
has the right to the confidentiality of his or her clinical records.
    (2) The patient has the right to access information contained in his 
or her clinical records within a reasonable time frame. The hospital 
must not frustrate the legitimate efforts of individuals to gain access 
to their own medical records and must actively seek to meet these 
requests as quickly as its record keeping system permits.
    (e) Standard: Restraint or seclusion. All patients have the right to 
be free from physical or mental abuse, and corporal punishment. All 
patients have the right to be free from restraint or seclusion, of any 
form, imposed as a means of coercion, discipline, convenience, or 
retaliation by staff. Restraint or seclusion may only be imposed to 
ensure the immediate physical safety of the patient, a staff member, or 
others and must be discontinued at the earliest possible time.
    (1) Definitions. (i) A restraint is--

[[Page 10]]

    (A) Any manual method, physical or mechanical device, material, or 
equipment that immobilizes or reduces the ability of a patient to move 
his or her arms, legs, body, or head freely; or
    (B) A drug or medication when it is used as a restriction to manage 
the patient's behavior or restrict the patient's freedom of movement and 
is not a standard treatment or dosage for the patient's condition.
    (C) A restraint does not include devices, such as orthopedically 
prescribed devices, surgical dressings or bandages, protective helmets, 
or other methods that involve the physical holding of a patient for the 
purpose of conducting routine physical examinations or tests, or to 
protect the patient from falling out of bed, or to permit the patient to 
participate in activities without the risk of physical harm (this does 
not include a physical escort).
    (ii) Seclusion is the involuntary confinement of a patient alone in 
a room or area from which the patient is physically prevented from 
leaving. Seclusion may only be used for the management of violent or 
self-destructive behavior.
    (2) Restraint or seclusion may only be used when less restrictive 
interventions have been determined to be ineffective to protect the 
patient a staff member or others from harm.
    (3) The type or technique of restraint or seclusion used must be the 
least restrictive intervention that will be effective to protect the 
patient, a staff member, or others from harm.
    (4) The use of restraint or seclusion must be--
    (i) In accordance with a written modification to the patient's plan 
of care; and
    (ii) Implemented in accordance with safe and appropriate restraint 
and seclusion techniques as determined by hospital policy in accordance 
with State law.
    (5) The use of restraint or seclusion must be in accordance with the 
order of a physician or other licensed independent practitioner who is 
responsible for the care of the patient as specified under Sec.  
482.12(c) and authorized to order restraint or seclusion by hospital 
policy in accordance with State law.
    (6) Orders for the use of restraint or seclusion must never be 
written as a standing order or on an as needed basis (PRN).
    (7) The attending physician must be consulted as soon as possible if 
the attending physician did not order the restraint or seclusion.
    (8) Unless superseded by State law that is more restrictive--
    (i) Each order for restraint or seclusion used for the management of 
violent or self-destructive behavior that jeopardizes the immediate 
physical safety of the patient, a staff member, or others may only be 
renewed in accordance with the following limits for up to a total of 24 
hours:
    (A) 4 hours for adults 18 years of age or older;
    (B) 2 hours for children and adolescents 9 to 17 years of age; or
    (C) 1 hour for children under 9 years of age; and
    (ii) After 24 hours, before writing a new order for the use of 
restraint or seclusion for the management of violent or self-destructive 
behavior, a physician or other licensed independent practitioner who is 
responsible for the care of the patient as specified under Sec.  
482.12(c) of this part and authorized to order restraint or seclusion by 
hospital policy in accordance with State law must see and assess the 
patient.
    (iii) Each order for restraint used to ensure the physical safety of 
the non-violent or non-self-destructive patient may be renewed as 
authorized by hospital policy.
    (9) Restraint or seclusion must be discontinued at the earliest 
possible time, regardless of the length of time identified in the order.
    (10) The condition of the patient who is restrained or secluded must 
be monitored by a physician, other licensed independent practitioner or 
trained staff that have completed the training criteria specified in 
paragraph (f) of this section at an interval determined by hospital 
policy.
    (11) Physician and other licensed independent practitioner training 
requirements must be specified in hospital policy. At a minimum, 
physicians and other licensed independent practitioners authorized to 
order restraint or

[[Page 11]]

seclusion by hospital policy in accordance with State law must have a 
working knowledge of hospital policy regarding the use of restraint or 
seclusion.
    (12) When restraint or seclusion is used for the management of 
violent or self-destructive behavior that jeopardizes the immediate 
physical safety of the patient, a staff member, or others, the patient 
must be seen face-to-face within 1 hour after the initiation of the 
intervention--
    (i) By a--
    (A) Physician or other licensed independent practitioner; or
    (B) Registered nurse or physician assistant who has been trained in 
accordance with the requirements specified in paragraph (f) of this 
section.
    (ii) To evaluate--
    (A) The patient's immediate situation;
    (B) The patient's reaction to the intervention;
    (C) The patient's medical and behavioral condition; and
    (D) The need to continue or terminate the restraint or seclusion.
    (13) States are free to have requirements by statute or regulation 
that are more restrictive than those contained in paragraph (e)(12)(i) 
of this section.
    (14) If the face-to-face evaluation specified in paragraph (e)(12) 
of this section is conducted by a trained registered nurse or physician 
assistant, the trained registered nurse or physician assistant must 
consult the attending physician or other licensed independent 
practitioner who is responsible for the care of the patient as specified 
under Sec.  482.12(c) as soon as possible after the completion of the 1-
hour face-to-face evaluation.
    (15) All requirements specified under this paragraph are applicable 
to the simultaneous use of restraint and seclusion. Simultaneous 
restraint and seclusion use is only permitted if the patient is 
continually monitored--
    (i) Face-to-face by an assigned, trained staff member; or
    (ii) By trained staff using both video and audio equipment. This 
monitoring must be in close proximity to the patient.
    (16) When restraint or seclusion is used, there must be 
documentation in the patient's medical record of the following:
    (i) The 1-hour face-to-face medical and behavioral evaluation if 
restraint or seclusion is used to manage violent or self-destructive 
behavior;
    (ii) A description of the patient's behavior and the intervention 
used;
    (iii) Alternatives or other less restrictive interventions attempted 
(as applicable);
    (iv) The patient's condition or symptom(s) that warranted the use of 
the restraint or seclusion; and
    (v) The patient's response to the intervention(s) used, including 
the rationale for continued use of the intervention.
    (f) Standard: Restraint or seclusion: Staff training requirements. 
The patient has the right to safe implementation of restraint or 
seclusion by trained staff.
    (1) Training intervals. Staff must be trained and able to 
demonstrate competency in the application of restraints, implementation 
of seclusion, monitoring, assessment, and providing care for a patient 
in restraint or seclusion--
    (i) Before performing any of the actions specified in this 
paragraph;
    (ii) As part of orientation; and
    (iii) Subsequently on a periodic basis consistent with hospital 
policy.
    (2) Training content. The hospital must require appropriate staff to 
have education, training, and demonstrated knowledge based on the 
specific needs of the patient population in at least the following:
    (i) Techniques to identify staff and patient behaviors, events, and 
environmental factors that may trigger circumstances that require the 
use of a restraint or seclusion.
    (ii) The use of nonphysical intervention skills.
    (iii) Choosing the least restrictive intervention based on an 
individualized assessment of the patient's medical, or behavioral status 
or condition.
    (iv) The safe application and use of all types of restraint or 
seclusion used in the hospital, including training in how to recognize 
and respond to signs of physical and psychological distress (for 
example, positional asphyxia);
    (v) Clinical identification of specific behavioral changes that 
indicate that

[[Page 12]]

restraint or seclusion is no longer necessary.
    (vi) Monitoring the physical and psychological well-being of the 
patient who is restrained or secluded, including but not limited to, 
respiratory and circulatory status, skin integrity, vital signs, and any 
special requirements specified by hospital policy associated with the 1-
hour face-to-face evaluation.
    (vii) The use of first aid techniques and certification in the use 
of cardiopulmonary resuscitation, including required periodic 
recertification.
    (3) Trainer requirements. Individuals providing staff training must 
be qualified as evidenced by education, training, and experience in 
techniques used to address patients' behaviors.
    (4) Training documentation. The hospital must document in the staff 
personnel records that the training and demonstration of competency were 
successfully completed.
    (g) Standard: Death reporting requirements: Hospitals must report 
deaths associated with the use of seclusion or restraint.
    (1) The hospital must report the following information to CMS:
    (i) Each death that occurs while a patient is in restraint or 
seclusion.
    (ii) Each death that occurs within 24 hours after the patient has 
been removed from restraint or seclusion.
    (iii) Each death known to the hospital that occurs within 1 week 
after restraint or seclusion where it is reasonable to assume that use 
of restraint or placement in seclusion contributed directly or 
indirectly to a patient's death. ``Reasonable to assume'' in this 
context includes, but is not limited to, deaths related to restrictions 
of movement for prolonged periods of time, or death related to chest 
compression, restriction of breathing or asphyxiation.
    (2) Each death referenced in this paragraph must be reported to CMS 
by telephone no later than the close of business the next business day 
following knowledge of the patient's death.
    (3) Staff must document in the patient's medical record the date and 
time the death was reported to CMS.

[71 FR 71426, Dec. 8, 2006]



                   Subpart C_Basic Hospital Functions



Sec.  482.21  Condition of participation: Quality assessment and performance improvement program.

    The hospital must develop, implement, and maintain an effective, 
ongoing, hospital-wide, data-driven quality assessment and performance 
improvement program. The hospital's governing body must ensure that the 
program reflects the complexity of the hospital's organization and 
services; involves all hospital departments and services (including 
those services furnished under contract or arrangement); and focuses on 
indicators related to improved health outcomes and the prevention and 
reduction of medical errors. The hospital must maintain and demonstrate 
evidence of its QAPI program for review by CMS.
    (a) Standard: Program scope. (1) The program must include, but not 
be limited to, an ongoing program that shows measurable improvement in 
indicators for which there is evidence that it will improve health 
outcomes and identify and reduce medical errors.
    (2) The hospital must measure, analyze, and track quality 
indicators, including adverse patient events, and other aspects of 
performance that assess processes of care, hospital service and 
operations.
    (b) Standard: Program data. (1) The program must incorporate quality 
indicator data including patient care data, and other relevant data, for 
example, information submitted to, or received from, the hospital's 
Quality Improvement Organization.
    (2) The hospital must use the data collected to--
    (i) Monitor the effectiveness and safety of services and quality of 
care; and
    (ii) Identify opportunities for improvement and changes that will 
lead to improvement.
    (3) The frequency and detail of data collection must be specified by 
the hospital's governing body.
    (c) Standard: Program activities. (1) The hospital must set 
priorities for its performance improvement activities that--

[[Page 13]]

    (i) Focus on high-risk, high-volume, or problem-prone areas;
    (ii) Consider the incidence, prevalence, and severity of problems in 
those areas; and
    (iii) Affect health outcomes, patient safety, and quality of care.
    (2) Performance improvement activities must track medical errors and 
adverse patient events, analyze their causes, and implement preventive 
actions and mechanisms that include feedback and learning throughout the 
hospital.
    (3) The hospital must take actions aimed at performance improvement 
and, after implementing those actions, the hospital must measure its 
success, and track performance to ensure that improvements are 
sustained.
    (d) Standard: Performance improvement projects. As part of its 
quality assessment and performance improvement program, the hospital 
must conduct performance improvement projects.
    (1) The number and scope of distinct improvement projects conducted 
annually must be proportional to the scope and complexity of the 
hospital's services and operations.
    (2) A hospital may, as one of its projects, develop and implement an 
information technology system explicitly designed to improve patient 
safety and quality of care. This project, in its initial stage of 
development, does not need to demonstrate measurable improvement in 
indicators related to health outcomes.
    (3) The hospital must document what quality improvement projects are 
being conducted, the reasons for conducting these projects, and the 
measurable progress achieved on these projects.
    (4) A hospital is not required to participate in a QIO cooperative 
project, but its own projects are required to be of comparable effort.
    (e) Standard: Executive responsibilities. The hospital's governing 
body (or organized group or individual who assumes full legal authority 
and responsibility for operations of the hospital), medical staff, and 
administrative officials are responsible and accountable for ensuring 
the following:
    (1) That an ongoing program for quality improvement and patient 
safety, including the reduction of medical errors, is defined, 
implemented, and maintained.
    (2) That the hospital-wide quality assessment and performance 
improvement efforts address priorities for improved quality of care and 
patient safety; and that all improvement actions are evaluated.
    (3) That clear expectations for safety are established.
    (4) That adequate resources are allocated for measuring, assessing, 
improving, and sustaining the hospital's performance and reducing risk 
to patients.
    (5) That the determination of the number of distinct improvement 
projects is conducted annually.

[68 FR 3454, Jan. 24, 2003]



Sec.  482.22  Condition of participation: Medical staff.

    The hospital must have an organized medical staff that operates 
under bylaws approved by the governing body and is responsible for the 
quality of medical care provided to patients by the hospital.
    (a) Standard: Composition of the medical staff. The medical staff 
must be composed of doctors of medicine or osteopathy and, in accordance 
with State law, may also be composed of other practitioners appointed by 
the governing body.
    (1) The medical staff must periodically conduct appraisals of its 
members.
    (2) The medical staff must examine credentials of candidates for 
medical staff membership and make recommendations to the governing body 
on the appointment of the candidates.
    (b) Standard: Medical staff organization and accountability. The 
medical staff must be well organized and accountable to the governing 
body for the quality of the medical care provided to patients.
    (1) The medical staff must be organized in a manner approved by the 
governing body.
    (2) If the medical staff has an executive committee, a majority of 
the members of the committee must be doctors of medicine or osteopathy.
    (3) The responsibility for organization and conduct of the medical 
staff must be assigned only to an individual

[[Page 14]]

doctor of medicine or osteopathy or, when permitted by State law of the 
State in which the hospital is located, a doctor of dental surgery or 
dental medicine.
    (c) Standard: Medical staff bylaws. The medical staff must adopt and 
enforce bylaws to carry out its responsibilities. The bylaws must:
    (1) Be approved by the governing body.
    (2) Include a statement of the duties and privileges of each 
category of medical staff (e.g., active, courtesy, etc.)
    (3) Describe the organization of the medical staff.
    (4) Describe the qualifications to be met by a candidate in order 
for the medical staff to recommend that the candidate be appointed by 
the governing body.
    (5) Include a requirement that--
    (i) A medical history and physical examination be completed and 
documented for each patient no more than 30 days before or 24 hours 
after admission or registration, but prior to surgery or a procedure 
requiring anesthesia services. The medical history and physical 
examination must be completed and documented by a physician (as defined 
in section 1861(r) of the Act), an oromaxillofacial surgeon, or other 
qualified licensed individual in accordance with State law and hospital 
policy.
    (ii) An updated examination of the patient, including any changes in 
the patient's condition, be completed and documented within 24 hours 
after admission or registration, but prior to surgery or a procedure 
requiring anesthesia services, when the medical history and physical 
examination are completed within 30 days before admission or 
registration. The updated examination of the patient, including any 
changes in the patient's condition, must be completed and documented by 
a physician (as defined in section 1861(r) of the Act), an 
oromaxillofacial surgeon, or other qualified licensed individual in 
accordance with State law and hospital policy.
    (6) Include criteria for determining the privileges to be granted to 
individual practitioners and a procedure for applying the criteria to 
individuals requesting privileges.
    (d) Standard: Autopsies. The medical staff should attempt to secure 
autopsies in all cases of unusual deaths and of medical-legal and 
educational interest. The mechanism for documenting permission to 
perform an autopsy must be defined. There must be a system for notifying 
the medical staff, and specifically the attending practitioner, when an 
autopsy is being performed.

[51 FR 22042, June 17, 1986, as amended at 59 FR 64152, Dec. 13, 1994; 
71 FR 68694, Nov. 27, 2006; 72 FR 66933, Nov. 27, 2007]



Sec.  482.23  Condition of participation: Nursing services.

    The hospital must have an organized nursing service that provides 
24-hour nursing services. The nursing services must be furnished or 
supervised by a registered nurse.
    (a) Standard: Organization. The hospital must have a well-organized 
service with a plan of administrative authority and delineation of 
responsibilities for patient care. The director of the nursing service 
must be a licensed registered nurse. He or she is responsible for the 
operation of the service, including determining the types and numbers of 
nursing personnel and staff necessary to provide nursing care for all 
areas of the hospital.
    (b) Standard: Staffing and delivery of care. The nursing service 
must have adequate numbers of licensed registered nurses, licensed 
practical (vocational) nurses, and other personnel to provide nursing 
care to all patients as needed. There must be supervisory and staff 
personnel for each department or nursing unit to ensure, when needed, 
the immediate availability of a registered nurse for bedside care of any 
patient.
    (1) The hospital must provide 24-hour nursing services furnished or 
supervised by a registered nurse, and have a licensed practical nurse or 
registered nurse on duty at all times, except for rural hospitals that 
have in effect a 24-hour nursing waiver granted under Sec.  488.54(c) of 
this chapter.
    (2) The nursing service must have a procedure to ensure that 
hospital nursing personnel for whom licensure is required have valid and 
current licensure.

[[Page 15]]

    (3) A registered nurse must supervise and evaluate the nursing care 
for each patient.
    (4) The hospital must ensure that the nursing staff develops, and 
keeps current, a nursing care plan for each patient.
    (5) A registered nurse must assign the nursing care of each patient 
to other nursing personnel in accordance with the patient's needs and 
the specialized qualifications and competence of the nursing staff 
available.
    (6) Non-employee licensed nurses who are working in the hospital 
must adhere to the policies and procedures of the hospital. The director 
of nursing service must provide for the adequate supervision and 
evaluation of the clinical activities of non-employee nursing personnel 
which occur within the responsibility of the nursing service.
    (c) Standard: Preparation and administration of drugs. Drugs and 
biologicals must be prepared and administered in accordance with Federal 
and State laws, the orders of the practitioner or practitioners 
responsible for the patient's care as specified under Sec.  482.12(c), 
and accepted standards of practice.
    (1) All drugs and biologicals must be administered by, or under 
supervision of, nursing or other personnel in accordance with Federal 
and State laws and regulations, including applicable licensing 
requirements, and in accordance with the approved medical staff policies 
and procedures.
    (2) With the exception of influenza and pneumococcal polysaccharide 
vaccines, which may be administered per physician-approved hospital 
policy after an assessment of contraindications, orders for drugs and 
biologicals must be documented and signed by a practitioner who is 
authorized to write orders by hospital policy and in accordance with 
State law, and who is responsible for the care of the patient as 
specified under Sec.  482.12(c).
    (i) If verbal orders are used, they are to be used infrequently.
    (ii) When verbal orders are used, they must only be accepted by 
persons who are authorized to do so by hospital policy and procedures 
consistent with Federal and State law.
    (3) Blood transfusions and intravenous medications must be 
administered in accordance with State law and approved medical staff 
policies and procedures. If blood transfusions and intravenous 
medications are administered by personnel other than doctors of medicine 
or osteopathy, the personnel must have special training for this duty.
    (4) There must be a hospital procedure for reporting transfusion 
reactions, adverse drug reactions, and errors in administration of 
drugs.

[51 FR 22042, June 17, 1986, as amended at 67 FR 61814, Oct. 2, 2002; 71 
FR 68694, Nov. 27, 2006; 72 FR 66933, Nov. 27, 2007]



Sec.  482.24  Condition of participation: Medical record services.

    The hospital must have a medical record service that has 
administrative responsibility for medical records. A medical record must 
be maintained for every individual evaluated or treated in the hospital.
    (a) Standard: Organization and staffing. The organization of the 
medical record service must be appropriate to the scope and complexity 
of the services performed. The hospital must employ adequate personnel 
to ensure prompt completion, filing, and retrieval of records.
    (b) Standard: Form and retention of record. The hospital must 
maintain a medical record for each inpatient and outpatient. Medical 
records must be accurately written, promptly completed, properly filed 
and retained, and accessible. The hospital must use a system of author 
identification and record maintenance that ensures the integrity of the 
authentification and protects the security of all record entries.
    (1) Medical records must be retained in their original or legally 
reproduced form for a period of at least 5 years.
    (2) The hospital must have a system of coding and indexing medical 
records. The system must allow for timely retrieval by diagnosis and 
procedure, in order to support medical care evaluation studies.
    (3) The hospital must have a procedure for ensuring the 
confidentiality of patient records. In-formation from or copies of 
records may be released only

[[Page 16]]

to authorized individuals, and the hospital must ensure that 
unauthorized individuals cannot gain access to or alter patient records. 
Original medical records must be released by the hospital only in 
accordance with Federal or State laws, court orders, or subpoenas.
    (c) Standard: Content of record. The medical record must contain 
information to justify admission and continued hospitalization, support 
the diagnosis, and describe the patient's progress and response to 
medications and services.
    (1) All patient medical record entries must be legible, complete, 
dated, timed, and authenticated in written or electronic form by the 
person responsible for providing or evaluating the service provided, 
consistent with hospital policies and procedures.
    (i) All orders, including verbal orders, must be dated, timed, and 
authenticated promptly by the ordering practitioner, except as noted in 
paragraph (c)(1)(ii) of this section.
    (ii) For the 5 year period following January 26, 2007, all orders, 
including verbal orders, must be dated, timed, and authenticated by the 
ordering practitioner or another practitioner who is responsible for the 
care of the patient as specified under Sec.  482.12(c) and authorized to 
write orders by hospital policy in accordance with State law.
    (iii) All verbal orders must be authenticated based upon Federal and 
State law. If there is no State law that designates a specific timeframe 
for the authentication of verbal orders, verbal orders must be 
authenticated within 48 hours.
    (2) All records must document the following, as appropriate:
    (i) Evidence of--
    (A) A medical history and physical examination completed and 
documented no more than 30 days before or 24 hours after admission or 
registration, but prior to surgery or a procedure requiring anesthesia 
services. The medical history and physical examination must be placed in 
the patient's medical record within 24 hours after admission or 
registration, but prior to surgery or a procedure requiring anesthesia 
services.
    (B) An updated examination of the patient, including any changes in 
the patient's condition, when the medical history and physical 
examination are completed within 30 days before admission or 
registration. Documentation of the updated examination must be placed in 
the patient's medical record within 24 hours after admission or 
registration, but prior to surgery or a procedure requiring anesthesia 
services.
    (ii) Admitting diagnosis.
    (iii) Results of all consultative evaluations of the patient and 
appropriate findings by clinical and other staff involved in the care of 
the patient.
    (iv) Documentation of complications, hospital acquired infections, 
and unfavorable reactions to drugs and anesthesia.
    (v) Properly executed informed consent forms for procedures and 
treatments specified by the medical staff, or by Federal or State law if 
applicable, to require written patient consent.
    (vi) All practitioners' orders, nursing notes, reports of treatment, 
medication records, radiology, and laboratory reports, and vital signs 
and other information necessary to monitor the patient's condition.
    (vii) Discharge summary with outcome of hospitalization, disposition 
of case, and provisions for follow-up care.
    (viii) Final diagnosis with completion of medical records within 30 
days following discharge.

[51 FR 22042, June 17, 1986, as amended at 71 FR 68694, Nov. 27, 2006; 
72 FR 66933, Nov. 27, 2007]



Sec.  482.25  Condition of participation: Pharmaceutical services.

    The hospital must have pharmaceutical services that meet the needs 
of the patients. The institution must have a pharmacy directed by a 
registered pharmacist or a drug storage area under competent 
supervision. The medical staff is responsible for developing policies 
and procedures that minimize drug errors. This function may be delegated 
to the hospital's organized pharmaceutical service.
    (a) Standard: Pharmacy management and administration. The pharmacy 
or drug storage area must be administered in accordance with accepted 
professional principles.
    (1) A full-time, part-time, or consulting pharmacist must be 
responsible

[[Page 17]]

for developing, supervising, and coordinating all the activities of the 
pharmacy services.
    (2) The pharmaceutical service must have an adequate number of 
personnel to ensure quality pharmaceutical services, including emergency 
services.
    (3) Current and accurate records must be kept of the receipt and 
disposition of all scheduled drugs.
    (b) Standard: Delivery of services. In order to provide patient 
safety, drugs and biologicals must be controlled and distributed in 
accordance with applicable standards of practice, consistent with 
Federal and State law.
    (1) All compounding, packaging, and dispensing of drugs and 
biologicals must be under the supervision of a pharmacist and performed 
consistent with State and Federal laws.
    (2)(i) All drugs and biologicals must be kept in a secure area, and 
locked when appropriate.
    (ii) Drugs listed in Schedules II, III, IV, and V of the 
Comprehensive Drug Abuse Prevention and Control Act of 1970 must be kept 
locked within a secure area.
    (iii) Only authorized personnel may have access to locked areas.
    (3) Outdated, mislabeled, or otherwise unusable drugs and 
biologicals must not be available for patient use.
    (4) When a pharmacist is not available, drugs and biologicals must 
be removed from the pharmacy or storage area only by personnel 
designated in the policies of the medical staff and pharmaceutical 
service, in accordance with Federal and State law.
    (5) Drugs and biologicals not specifically prescribed as to time or 
number of doses must automatically be stopped after a reasonable time 
that is predetermined by the medical staff.
    (6) Drug administration errors, adverse drug reactions, and 
incompatibilities must be immediately reported to the attending 
physician and, if appropriate, to the hospital-wide quality assurance 
program.
    (7) Abuses and losses of controlled substances must be reported, in 
accordance with applicable Federal and State laws, to the individual 
responsible for the pharmaceutical service, and to the chief executive 
officer, as appropriate.
    (8) Information relating to drug interactions and information of 
drug therapy, side effects, toxicology, dosage, indications for use, and 
routes of administration must be available to the professional staff.
    (9) A formulary system must be established by the medical staff to 
assure quality pharmaceuticals at reasonable costs.

[51 FR 22042, June 17, 1986; 51 FR 27848, Aug. 4, 1986; 71 FR 68694, 
Nov. 27, 2006]



Sec.  482.26  Condition of participation: Radiologic services.

    The hospital must maintain, or have available, diagnostic radiologic 
services. If therapeutic services are also provided, they, as well as 
the diagnostic services, must meet professionally approved standards for 
safety and personnel qualifications.
    (a) Standard: Radiologic services. The hospital must maintain, or 
have available, radiologic services according to needs of the patients.
    (b) Standard: Safety for patients and personnel. The radiologic 
services, particularly ionizing radiology procedures, must be free from 
hazards for patients and personnel.
    (1) Proper safety precutions must be maintained against radiation 
hazards. This includes adequate shielding for patients, personnel, and 
facilities, as well as appropriate storage, use, and disposal of 
radioactive materials.
    (2) Periodic inspection of equipment must be made and hazards 
identified must be promptly corrected.
    (3) Radiation workers must be checked periodically, by the use of 
exposure meters or badge tests, for amount of radiation exposure.
    (4) Radiologic services must be provided only on the order of 
practitioners with clinical privileges or, consistent with State law, of 
other practitioners authorized by the medical staff and the governing 
body to order the services.
    (c) Standard: Personnel. (1) A qualified full-time, part-time, or 
consulting radiologist must supervise the ionizing radiology services 
and must interpret

[[Page 18]]

only those radiologic tests that are determined by the medical staff to 
require a radiologist's specialized knowledge. For purposes of this 
section, a radiologist is a doctor of medicine or osteopathy who is 
qualified by education and experience in radiology.
    (2) Only personnel designated as qualified by the medical staff may 
use the radiologic equipment and administer procedures.
    (d) Standard: Records. Records of radiologic services must be 
maintained.
    (1) The radiologist or other practitioner who performs radiology 
services must sign reports of his or her interpretations.
    (2) The hospital must maintain the following for at least 5 years:
    (i) Copies of reports and printouts.
    (ii) Films, scans, and other image records, as appropriate.

[51 FR 22042, June 17, 1986; 51 FR 27848, Aug. 4, 1986]



Sec.  482.27  Condition of participation: Laboratory services.

    The hospital must maintain, or have available, adequate laboratory 
services to meet the needs of its patients. The hospital must ensure 
that all laboratory services provided to its patients are performed in a 
facility certified in accordance with part 493 of this chapter.
    (a) Standard: Adequacy of laboratory services. The hospital must 
have laboratory services available, either directly or through a 
contractual agreement with a certified laboratory that meets 
requirements of part 493 of this chapter.
    (1) Emergency laboratory services must be available 24 hours a day.
    (2) A written description of services provided must be available to 
the medical staff.
    (3) The laboratory must make provision for proper receipt and 
reporting of tissue specimens.
    (4) The medical staff and a pathologist must determine which tissue 
specimens require a macroscopic (gross) examination and which require 
both macroscopic and microscopic examinations.
    (b) Standard: Potentially infectious blood and blood components--(1) 
Potentially human immunodeficiency virus (HIV) infectious blood and 
blood components. Potentially HIV infectious blood and blood components 
are prior collections from a donor--
    (i) Who tested negative at the time of donation but tests reactive 
for evidence of HIV infection on a later donation;
    (ii) Who tests positive on the supplemental (additional, more 
specific) test or other follow-up testing required by FDA; and
    (iii) For whom the timing of seroconversion cannot be precisely 
estimated.
    (2) Potentially hepatitis C virus (HCV) infectious blood and blood 
components. Potentially HCV infectious blood and blood components are 
the blood and blood components identified in 21 CFR 610.47.
    (3) Services furnished by an outside blood collecting establishment. 
If a hospital regularly uses the services of an outside blood collecting 
establishment, it must have an agreement with the blood collecting 
establishment that governs the procurement, transfer, and availability 
of blood and blood components. The agreement must require that the blood 
collecting establishment notify the hospital--
    (i) Within 3 calendar days if the blood collecting establishment 
supplied blood and blood components collected from a donor who tested 
negative at the time of donation but tests reactive for evidence of HIV 
or HCV infection on a later donation or who is determined to be at 
increased risk for transmitting HIV or HCV infection;
    (ii) Within 45 days of the test, of the results of the supplemental 
(additional, more specific) test for HIV or HCV, as relevant, or other 
follow-up testing required by FDA; and
    (iii) Within 3 calendar days after the blood collecting 
establishment supplied blood and blood components collected from an 
infectious donor, whenever records are available, as set forth at 21 CFR 
610.48(b)(3).
    (4) Quarantine and disposition of blood and blood components pending 
completion of testing. If the blood collecting establishment (either 
internal or under an agreement) notifies the hospital of the

[[Page 19]]

reactive HIV or HCV screening test results, the hospital must determine 
the disposition of the blood or blood product and quarantine all blood 
and blood components from previous donations in inventory.
    (i) If the blood collecting establishment notifies the hospital that 
the result of the supplemental (additional, more specific) test or other 
follow-up testing required by FDA is negative, absent other informative 
test results, the hospital may release the blood and blood components 
from quarantine.
    (ii) If the blood collecting establishment notifies the hospital 
that the result of the supplemental, (additional, more specific) test or 
other follow-up testing required by FDA is positive, the hospital must--
    (A) Dispose of the blood and blood components; and
    (B) Notify the transfusion recipients as set forth in paragraph 
(b)(6) of this section.
    (iii) If the blood collecting establishment notifies the hospital 
that the result of the supplemental, (additional, more specific) test or 
other follow-up testing required by FDA is indeterminate, the hospital 
must destroy or label prior collections of blood or blood components 
held in quarantine as set forth at 21 CFR 610.46(b)(2), 610.47(b)(2), 
and 610.48(c)(2).
    (5) Recordkeeping by the hospital. The hospital must maintain--
    (i) Records of the source and disposition of all units of blood and 
blood components for at least 10 years from the date of disposition in a 
manner that permits prompt retrieval; and
    (ii) A fully funded plan to transfer these records to another 
hospital or other entity if such hospital ceases operation for any 
reason.
    (6) Patient notification. If the hospital has administered 
potentially HIV or HCV infectious blood or blood components (either 
directly through its own blood collecting establishment or under an 
agreement) or released such blood or blood components to another entity 
or individual, the hospital must take the following actions:
    (i) Make reasonable attempts to notify the patient, or to notify the 
attending physician or the physician who ordered the blood or blood 
component and ask the physician to notify the patient, or other 
individual as permitted under paragraph (b)(10) of this section, that 
potentially HIV or HCV infectious blood or blood components were 
transfused to the patient and that there may be a need for HIV or HCV 
testing and counseling.
    (ii) If the physician is unavailable or declines to make the 
notification, make reasonable attempts to give this notification to the 
patient, legal guardian, or relative.
    (iii) Document in the patient's medical record the notification or 
attempts to give the required notification.
    (7) Timeframe for notification--(i) For donors tested on or after 
February 20, 2008. For notifications resulting from donors tested on or 
after February 20, 2008 as set forth at 21 CFR 610.46 and 21 CFR 610.47 
the notification effort begins when the blood collecting establishment 
notifies the hospital that it received potentially HIV or HCV infectious 
blood and blood components. The hospital must make reasonable attempts 
to give notification over a period of 12 weeks unless--
    (A) The patient is located and notified; or
    (B) The hospital is unable to locate the patient and documents in 
the patient's medical record the extenuating circumstances beyond the 
hospital's control that caused the notification timeframe to exceed 12 
weeks.
    (ii) For donors tested before February 20, 2008. For notifications 
resulting from donors tested before February 20, 2008 as set forth at 21 
CFR 610.48(b) and (c), the notification effort begins when the blood 
collecting establishment notifies the hospital that it received 
potentially HCV infectious blood and blood components. The hospital must 
make reasonable attempts to give notification and must complete the 
actions within 1 year of the date on which the hospital received 
notification from the outside blood collecting establishment.
    (8) Content of notification. The notification must include the 
following information:
    (i) A basic explanation of the need for HIV or HCV testing and 
counseling;
    (ii) Enough oral or written information so that an informed decision 
can

[[Page 20]]

be made about whether to obtain HIV or HCV testing and counseling; and
    (iii) A list of programs or places where the person can obtain HIV 
or HCV testing and counseling, including any requirements or 
restrictions the program may impose.
    (9) Policies and procedures. The hospital must establish policies 
and procedures for notification and documentation that conform to 
Federal, State, and local laws, including requirements for the 
confidentiality of medical records and other patient information.
    (10) Notification to legal representative or relative. If the 
patient has been adjudged incompetent by a State court, the physician or 
hospital must notify a legal representative designated in accordance 
with State law. If the patient is competent, but State law permits a 
legal representative or relative to receive the information on the 
patient's behalf, the physician or hospital must notify the patient or 
his or her legal representative or relative. For possible HIV infectious 
transfusion recipients that are deceased, the physician or hospital must 
inform the deceased patient's legal representative or relative. If the 
patient is a minor, the parents or legal guardian must be notified.
    (11) Applicability. HCV notification requirements resulting from 
donors tested before February 20, 2008 as set forth at 21 CFR 610.48 
will expire on August 24, 2015.
    (c) General blood safety issues. For lookback activities only 
related to new blood safety issues that are identified after August 24, 
2007, hospitals must comply with FDA regulations as they pertain to 
blood safety issues in the following areas:
    (1) Appropriate testing and quarantining of infectious blood and 
blood components.
    (2) Notification and counseling of recipients that may have received 
infectious blood and blood components.

[57 FR 7136, Feb. 28, 1992, as amended at 61 FR 47433, Sept. 9, 1996; 72 
FR 48573, Aug. 24, 2007]



Sec.  482.28  Condition of participation: Food and dietetic services.

    The hospital must have organized dietary services that are directed 
and staffed by adequate qualified personnel. However, a hospital that 
has a contract with an outside food management company may be found to 
meet this Condition of participation if the company has a dietitian who 
serves the hospital on a full-time, part-time, or consultant basis, and 
if the company maintains at least the minimum standards specified in 
this section and provides for constant liaison with the hospital medical 
staff for recommendations on dietetic policies affecting patient 
treatment.
    (a) Standard: Organization. (1) The hospital must have a full-time 
employee who--
    (i) Serves as director of the food and dietetic service;
    (ii) Is responsible for the daily management of the dietary 
services; and
    (iii) Is qualified by experience or training.
    (2) There must be a qualified dietitian, full-time, part-time, or on 
a consultant basis.
    (3) There must be administrative and technical personnel competent 
in their respective duties.
    (b) Standard: Diets. Menus must meet the needs of the patients.
    (1) Therapeutic diets must be prescribed by the practitioner or 
practitioners responsible for the care of the patients.
    (2) Nutritional needs must be met in accordance with recognized 
dietary practices and in accordance with orders of the practitioner or 
practitioners responsible for the care of the patients.
    (3) A current therapeutic diet manual approved by the dietitian and 
medical staff must be readily available to all medical, nursing, and 
food service personnel.



Sec.  482.30  Condition of participation: Utilization review.

    The hospital must have in effect a utilization review (UR) plan that 
provides for review of services furnished by the institution and by 
members of the medical staff to patients entitled to benefits under the 
Medicare and Medicaid programs.
    (a) Applicability. The provisions of this section apply except in 
either of the following circumstances:
    (1) A Utilization and Quality Control Quality Improvement 
Organization

[[Page 21]]

(QIO) has assumed binding review for the hospital.
    (2) CMS has determined that the UR procedures established by the 
State under title XIX of the Act are superior to the procedures required 
in this section, and has required hospitals in that State to meet the UR 
plan requirements under Sec. Sec.  456.50 through 456.245 of this 
chapter.
    (b) Standard: Composition of utilization review committee. A UR 
committee consisting of two or more practitioners must carry out the UR 
function. At least two of the members of the committee must be doctors 
of medicine or osteopathy. The other members may be any of the other 
types of practitioners specified in Sec.  482.12(c)(1).
    (1) Except as specified in paragraphs (b) (2) and (3) of this 
section, the UR committee must be one of the following:
    (i) A staff committee of the institution;
    (ii) A group outside the institution--
    (A) Established by the local medical society and some or all of the 
hospitals in the locality; or
    (B) Established in a manner approved by CMS.
    (2) If, because of the small size of the institution, it is 
impracticable to have a properly functioning staff committee, the UR 
committee must be established as specified in paragraph (b)(1)(ii) of 
this section.
    (3) The committee's or group's reviews may not be conducted by any 
individual who--
    (i) Has a direct financial interest (for example, an ownership 
interest) in that hospital; or
    (ii) Was professionally involved in the care of the patient whose 
case is being reviewed.
    (c) Standard: Scope and frequency of review. (1) The UR plan must 
provide for review for Medicare and Medicaid patients with respect to 
the medical necessity of--
    (i) Admissions to the institution;
    (ii) The duration of stays; and
    (iii) Professional services furnished, including drugs and 
biologicals.
    (2) Review of admissions may be performed before, at, or after 
hospital admission.
    (3) Except as specified in paragraph (e) of this section, reviews 
may be conducted on a sample basis.
    (4) Hospitals that are paid for inpatient hospital services under 
the prospective payment system set forth in Part 412 of this chapter 
must conduct review of duration of stays and review of professional 
services as follows:
    (i) For duration of stays, these hospitals need review only cases 
that they reasonably assume to be outlier cases based on extended length 
of stay, as described in Sec.  412.80(a)(1)(i) of this chapter; and
    (ii) For professional services, these hospitals need review only 
cases that they reasonably assume to be outlier cases based on 
extraordinarily high costs, as described in Sec.  412.80(a)(1)(ii) of 
this chapter.
    (d) Standard: Determination regarding admissions or continued stays. 
(1) The determination that an admission or continued stay is not 
medically necessary--
    (i) May be made by one member of the UR committee if the 
practitioner or practitioners responsible for the care of the patient, 
as specified of Sec.  482.12(c), concur with the determination or fail 
to present their views when afforded the opportunity; and
    (ii) Must be made by at least two members of the UR committee in all 
other cases.
    (2) Before making a determination that an admission or continued 
stay is not medically necessary, the UR committee must consult the 
practitioner or practitioners responsible for the care of the patient, 
as specified in Sec.  482.12(c), and afford the practitioner or 
practitioners the opportunity to present their views.
    (3) If the committee decides that admission to or continued stay in 
the hospital is not medically necessary, written notification must be 
given, no later than 2 days after the determination, to the hospital, 
the patient, and the practitioner or practitioners responsible for the 
care of the patient, as specified in Sec.  482.12(c);
    (e) Standard: Extended stay review. (1) In hospitals that are not 
paid under the prospective payment system, the UR committee must make a 
periodic review, as specified in the UR plan, of

[[Page 22]]

each current inpatient receiving hospital services during a continuous 
period of extended duration. The scheduling of the periodic reviews 
may--
    (i) Be the same for all cases; or
    (ii) Differ for different classes of cases.
    (2) In hospitals paid under the prospective payment system, the UR 
committee must review all cases reasonably assumed by the hospital to be 
outlier cases because the extended length of stay exceeds the threshold 
criteria for the diagnosis, as described in Sec.  412.80(a)(1)(i). The 
hospital is not required to review an extended stay that does not exceed 
the outlier threshold for the diagnosis.
    (3) The UR committee must make the periodic review no later than 7 
days after the day required in the UR plan.
    (f) Standard: Review of professional services. The committee must 
review professional services provided, to determine medical necessity 
and to promote the most efficient use of available health facilities and 
services.



Sec.  482.41  Condition of participation: Physical environment.

    The hospital must be constructed, arranged, and maintained to ensure 
the safety of the patient, and to provide facilities for diagnosis and 
treatment and for special hospital services appropriate to the needs of 
the community.
    (a) Standard: Buildings. The condition of the physical plant and the 
overall hospital environment must be developed and maintained in such a 
manner that the safety and well-being of patients are assured.
    (1) There must be emergency power and lighting in at least the 
operating, recovery, intensive care, and emergency rooms, and 
stairwells. In all other areas not serviced by the emergency supply 
source, battery lamps and flashlights must be available.
    (2) There must be facilities for emergency gas and water supply.
    (b) Standard: Life safety from fire. (1) Except as otherwise 
provided in this section--
    (i) The hospital must meet the applicable provisions of the 2000 
edition of the Life Safety Code of the National Fire Protection 
Association. The Director of the Office of the Federal Register has 
approved the NFPA 101 [reg] 2000 edition of the Life Safety 
Code, issued January 14, 2000, for incorporation by reference in 
accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy of the Code is 
available for inspection at the CMS Information Resource Center, 7500 
Security Boulevard, Baltimore, MD or at the National Archives and 
Records Administration (NARA). For information on the availability of 
this material at NARA, call 202-741-6030, or go to: http://
www.archives.gov/federal--register/code--of--federal--regulations/ibr--
locations.html. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269. If any changes in 
this edition of the Code are incorporated by reference, CMS will publish 
notice in the Federal Register to announce the changes.
    (ii) Chapter 19.3.6.3.2, exception number 2 of the adopted edition 
of the LSC does not apply to hospitals.
    (2) After consideration of State survey agency findings, CMS may 
waive specific provisions of the Life Safety Code which, if rigidly 
applied, would result in unreasonable hardship upon the facility, but 
only if the waiver does not adversely affect the health and safety of 
the patients.
    (3) The provisions of the Life Safety Code do not apply in a State 
where CMS finds that a fire and safety code imposed by State law 
adequately protects patients in hospitals.
    (4) Beginning March 13, 2006, a hospital must be in compliance with 
Chapter 19.2.9, Emergency Lighting.
    (5) Beginning March 13, 2006, Chapter 19.3.6.3.2, exception number 2 
does not apply to hospitals.
    (6) The hospital must have procedures for the proper routine storage 
and prompt disposal of trash.
    (7) The hospital must have written fire control plans that contain 
provisions for prompt reporting of fires; extinguishing fires; 
protection of patients, personnel and guests; evacuation; and 
cooperation with fire fighting authorities.
    (8) The hospital must maintain written evidence of regular 
inspection and approval by State or local fire control agencies.

[[Page 23]]

    (9) Notwithstanding any provisions of the 2000 edition of the Life 
Safety Code to the contrary, a hospital may install alcohol-based hand 
rub dispensers in its facility if--
    (i) Use of alcohol-based hand rub dispensers does not conflict with 
any State or local codes that prohibit or otherwise restrict the 
placement of alcohol-based hand rub dispensers in health care 
facilities;
    (ii) The dispensers are installed in a manner that minimizes leaks 
and spills that could lead to falls;
    (iii) The dispensers are installed in a manner that adequately 
protects against inappropriate access;
    (iv) The dispensers are installed in accordance with chapter 
18.3.2.7 or chapter 19.3.2.7 of the 2000 edition of the Life Safety 
Code, as amended by NFPA Temporary Interim Amendment 00-1(101), issued 
by the Standards Council of the National Fire Protection Association on 
April 15, 2004. The Director of the Office of the Federal Register has 
approved NFPA Temporary Interim Amendment 00-1(101) for incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy 
of the amendment is available for inspection at the CMS Information 
Resource Center, 7500 Security Boulevard, Baltimore, MD and at the 
Office of the Federal Register, 800 North Capitol Street NW., Suite 700, 
Washington, DC. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269; and
    (v) The dispensers are maintained in accordance with dispenser 
manufacturer guidelines.
    (c) Standard: Facilities. The hospital must maintain adequate 
facilities for its services.
    (1) Diagnostic and therapeutic facilities must be located for the 
safety of patients.
    (2) Facilities, supplies, and equipment must be maintained to ensure 
an acceptable level of safety and quality.
    (3) The extent and complexity of facilities must be determined by 
the services offered.
    (4) There must be proper ventilation, light, and temperature 
controls in pharmaceutical, food preparation, and other appropriate 
areas.

[51 FR 22042, June 17, 1986, as amended at 53 FR 11509, Apr. 7, 1988; 68 
FR 1386, Jan. 10, 2003; 69 FR 49267, Aug. 11, 2004; 70 FR 15238, Mar. 
25, 2005; 71 FR 55340, Sept. 22, 2006]



Sec.  482.42  Condition of participation: Infection control.

    The hospital must provide a sanitary environment to avoid sources 
and transmission of infections and communicable diseases. There must be 
an active program for the prevention, control, and investigation of 
infections and communicable diseases.
    (a) Standard: Organization and policies. A person or persons must be 
designated as infection control officer or officers to develop and 
implement policies governing control of infections and communicable 
diseases.
    (1) The infection control officer or officers must develop a system 
for identifying, reporting, investigating, and controlling infections 
and communicable diseases of patients and personnel.
    (2) The infection control officer or officers must maintain a log of 
incidents related to infections and communicable diseases.
    (b) Standard: Responsibilities of chief executive officer, medical 
staff, and director of nursing services. The chief executive officer, 
the medical staff, and the director of nursing services must--
    (1) Ensure that the hospital-wide quality assurance program and 
training programs address problems identified by the infection control 
officer or officers; and
    (2) Be responsible for the implementation of successful corrective 
action plans in affected problem areas.



Sec.  482.43  Condition of participation: Discharge planning.

    The hospital must have in effect a discharge planning process that 
applies to all patients. The hospital's policies and procedures must be 
specified in writing.
    (a) Standard: Identification of patients in need of discharge 
planning. The hospital must identify at an early stage of 
hospitalization all patients who are

[[Page 24]]

likely to suffer adverse health consequences upon discharge if there is 
no adequate discharge planning.
    (b) Standard: Discharge planning evaluation. (1) The hospital must 
provide a discharge planning evaluation to the patients identified in 
paragraph (a) of this section, and to other patients upon the patient's 
request, the request of a person acting on the patient's behalf, or the 
request of the physician.
    (2) A registered nurse, social worker, or other appropriately 
qualified personnel must develop, or supervise the development of, the 
evaluation.
    (3) The discharge planning evaluation must include an evaluation of 
the likelihood of a patient needing post- hospital services and of the 
availability of the services.
    (4) The discharge planning evaluation must include an evaluation of 
the likelihood of a patient's capacity for self-care or of the 
possibility of the patient being cared for in the environment from which 
he or she entered the hospital.
    (5) The hospital personnel must complete the evaluation on a timely 
basis so that appropriate arrangements for post-hospital care are made 
before discharge, and to avoid unnecessary delays in discharge.
    (6) The hospital must include the discharge planning evaluation in 
the patient's medical record for use in establishing an appropriate 
discharge plan and must discuss the results of the evaluation with the 
patient or individual acting on his or her behalf.
    (c) Standard: Discharge plan. (1) A registered nurse, social worker, 
or other appropriately qualified personnel must develop, or supervise 
the development of, a discharge plan if the discharge planning 
evaluation indicates a need for a discharge plan.
    (2) In the absence of a finding by the hospital that a patient needs 
a discharge plan, the patient's physician may request a discharge plan. 
In such a case, the hospital must develop a discharge plan for the 
patient.
    (3) The hospital must arrange for the initial implementation of the 
patient's discharge plan.
    (4) The hospital must reassess the patient's discharge plan if there 
are factors that may affect continuing care needs or the appropriateness 
of the discharge plan.
    (5) As needed, the patient and family members or interested persons 
must be counseled to prepare them for post-hospital care.
    (6) The hospital must include in the discharge plan a list of HHAs 
or SNFs that are available to the patient, that are participating in the 
Medicare program, and that serve the geographic area (as defined by the 
HHA) in which the patient resides, or in the case of a SNF, in the 
geographic area requested by the patient. HHAs must request to be listed 
by the hospital as available.
    (i) This list must only be presented to patients for whom home 
health care or post-hospital extended care services are indicated and 
appropriate as determined by the discharge planning evaluation.
    (ii) For patients enrolled in managed care organizations, the 
hospital must indicate the availability of home health and posthospital 
extended care services through individuals and entities that have a 
contract with the managed care organizations.
    (iii) The hospital must document in the patient's medical record 
that the list was presented to the patient or to the individual acting 
on the patient's behalf.
    (7) The hospital, as part of the discharge planning process, must 
inform the patient or the patient's family of their freedom to choose 
among participating Medicare providers of posthospital care services and 
must, when possible, respect patient and family preferences when they 
are expressed. The hospital must not specify or otherwise limit the 
qualified providers that are available to the patient.
    (8) The discharge plan must identify any HHA or SNF to which the 
patient is referred in which the hospital has a disclosable financial 
interest, as specified by the Secretary, and any HHA or SNF that has a 
disclosable financial interest in a hospital under Medicare. Financial 
interests that are disclosable under Medicare are determined in 
accordance with the provisions of Part 420, Subpart C, of this chapter.
    (d) Standard: Transfer or referral. The hospital must transfer or 
refer patients, along with necessary medical

[[Page 25]]

information, to appropriate facilities, agencies, or outpatient 
services, as needed, for followup or ancillary care.
    (e) Standard: Reassessment. The hospital must reassess its discharge 
planning process on an on-going basis. The reassessment must include a 
review of discharge plans to ensure that they are responsive to 
discharge needs.

[59 FR 64152, Dec. 13, 1994, as amended at 69 FR 49268, Aug. 11, 2004]



Sec.  482.45  Condition of participation: Organ, tissue, and eye procurement.

    (a) Standard: Organ procurement responsibilities. The hospital must 
have and implement written protocols that:
    (1) Incorporate an agreement with an OPO designated under part 486 
of this chapter, under which it must notify, in a timely manner, the OPO 
or a third party designated by the OPO of individuals whose death is 
imminent or who have died in the hospital. The OPO determines medical 
suitability for organ donation and, in the absence of alternative 
arrangements by the hospital, the OPO determines medical suitability for 
tissue and eye donation, using the definition of potential tissue and 
eye donor and the notification protocol developed in consultation with 
the tissue and eye banks identified by the hospital for this purpose;
    (2) Incorporate an agreement with at least one tissue bank and at 
least one eye bank to cooperate in the retrieval, processing, 
preservation, storage and distribution of tissues and eyes, as may be 
appropriate to assure that all usable tissues and eyes are obtained from 
potential donors, insofar as such an agreement does not interfere with 
organ procurement;
    (3) Ensure, in collaboration with the designated OPO, that the 
family of each potential donor is informed of its options to donate 
organs, tissues, or eyes or to decline to donate. The individual 
designated by the hospital to initiate the request to the family must be 
an organ procurement representative or a designated requestor. A 
designated requestor is an individual who has completed a course offered 
or approved by the OPO and designed in conjunction with the tissue and 
eye bank community in the methodology for approaching potential donor 
families and requesting organ or tissue donation;
    (4) Encourage discretion and sensitivity with respect to the 
circumstances, views, and beliefs of the families of potential donors;
    (5) Ensure that the hospital works cooperatively with the designated 
OPO, tissue bank and eye bank in educating staff on donation issues, 
reviewing death records to improve identification of potential donors, 
and maintaining potential donors while necessary testing and placement 
of potential donated organs, tissues, and eyes take place.
    (b) Standard: Organ transplantation responsibilities. (1) A hospital 
in which organ transplants are performed must be a member of the Organ 
Procurement and Transplantation Network (OPTN) established and operated 
in accordance with section 372 of the Public Health Service (PHS) Act 
(42 U.S.C. 274) and abide by its rules. The term ``rules of the OPTN'' 
means those rules provided for in regulations issued by the Secretary in 
accordance with section 372 of the PHS Act which are enforceable under 
42 CFR 121.10. No hospital is considered to be out of compliance with 
section 1138(a)(1)(B) of the Act, or with the requirements of this 
paragraph, unless the Secretary has given the OPTN formal notice that he 
or she approves the decision to exclude the hospital from the OPTN and 
has notified the hospital in writing.
    (2) For purposes of these standards, the term ``organ'' means a 
human kidney, liver, heart, lung, or pancreas.
    (3) If a hospital performs any type of transplants, it must provide 
organ-transplant-related data, as requested by the OPTN, the Scientific 
Registry, and the OPOs. The hospital must also provide such data 
directly to the Department when requested by the Secretary.

[63 FR 33875, June 22, 1998]



                  Subpart D_Optional Hospital Services



Sec.  482.51  Condition of participation: Surgical services.

    If the hospital provides surgical services, the services must be 
well organized and provided in accordance with

[[Page 26]]

acceptable standards of practice. If outpatient surgical services are 
offered the services must be consistent in quality with inpatient care 
in accordance with the complexity of services offered.
    (a) Standard: Organization and staffing. The organization of the 
surgical services must be appropriate to the scope of the services 
offered.
    (1) The operating rooms must be supervised by an experienced 
registered nurse or a doctor of medicine or osteopathy.
    (2) Licensed practical nurses (LPNs) and surgical technologists 
(operating room technicians) may serve as ``scrub nurses'' under the 
supervision of a registered nurse.
    (3) Qualified registered nurses may perform circulating duties in 
the operating room. In accordance with applicable State laws and 
approved medical staff policies and procedures, LPNs and surgical 
technologists may assist in circulatory duties under the surpervision of 
a qualified registered nurse who is immediately available to respond to 
emergencies.
    (4) Surgical privileges must be delineated for all practitioners 
performing surgery in accordance with the competencies of each 
practitioner. The surgical service must maintain a roster of 
practitioners specifying the surgical privileges of each practitioner.
    (b) Standard: Delivery of service. Surgical services must be 
consistent with needs and resources. Policies governing surgical care 
must be designed to assure the achievement and maintenance of high 
standards of medical practice and patient care.
    (1) Prior to surgery or a procedure requiring anesthesia services 
and except in the case of emergencies:
    (i) A medical history and physical examination must be completed and 
documented no more than 30 days before or 24 hours after admission or 
registration.
    (ii) An updated examination of the patient, including any changes in 
the patient's condition, must be completed and documented within 24 
hours after admission or registration when the medical history and 
physical examination are completed within 30 days before admission or 
registration.
    (2) A properly executed informed consent form for the operation must 
be in the patient's chart before surgery, except in emergencies.
    (3) The following equipment must be available to the operating room 
suites: call-in-system, cardiac monitor, resuscitator, defibrillator, 
aspirator, and tracheotomy set.
    (4) There must be adequate provisions for immediate post-operative 
care.
    (5) The operating room register must be complete and up-to-date.
    (6) An operative report describing techniques, findings, and tissues 
removed or altered must be written or dictated immediately following 
surgery and signed by the surgeon.

[51 FR 22042, June 17, 1986, as amended at 72 FR 66933, Nov. 27, 2007]



Sec.  482.52  Condition of participation: Anesthesia services.

    If the hospital furnishes anesthesia services, they must be provided 
in a well-organized manner under the direction of a qualified doctor of 
medicine or osteopathy. The service is responsible for all anesthesia 
administered in the hospital.
    (a) Standard: Organization and staffing. The organization of 
anesthesia services must be appropriate to the scope of the services 
offered. Anesthesia must be administered only by--
    (1) A qualified anesthesiologist;
    (2) A doctor of medicine or osteopathy (other than an 
anesthesiologist);
    (3) A dentist, oral surgeon, or podiatrist who is qualified to 
administer anesthesia under State law;
    (4) A certified registered nurse anesthetist (CRNA), as defined in 
Sec.  410.69(b) of this chapter, who, unless exempted in accordance with 
paragraph (c)of this section, is under the supervision of the operating 
practitioner or of an anesthesiologist who is immediately available if 
needed; or
    (5) An anesthesiologist's assistant, as defined in Sec.  410.69(b) 
of this chapter, who is under the supervision of an anesthesiologist who 
is immediately available if needed.
    (b) Standard: Delivery of services. Anesthesia services must be 
consistent with needs and resources. Policies on anesthesia procedures 
must include the

[[Page 27]]

delineation of preanesthesia and post anesthesia responsibilities. The 
policies must ensure that the following are provided for each patient:
    (1) A preanesthesia evaluation completed and documented by an 
individual qualified to administer anesthesia, as specified in paragraph 
(a) of this section, performed within 48 hours prior to surgery or a 
procedure requiring anesthesia services.
    (2) An intraoperative anesthesia record.
    (3) A postanesthesia evaluation completed and documented by an 
individual qualified to administer anesthesia, as specified in paragraph 
(a) of this section, no later than 48 hours after surgery or a procedure 
requiring anesthesia services. The postanesthesia evaluation for 
anesthesia recovery must be completed in accordance with State law and 
with hospital policies and procedures that have been approved by the 
medical staff and that reflect current standards of anesthesia care.
    (c) Standard: State exemption. (1) A hospital may be exempted from 
the requirement for physician supervision of CRNAs as described in 
paragraph (a)(4) of this section, if the State in which the hospital is 
located submits a letter to CMS signed by the Governor, following 
consultation with the State's Boards of Medicine and Nursing, requesting 
exemption from physician supervision of CRNAs. The letter from the 
Governor must attest that he or she has consulted with State Boards of 
Medicine and Nursing about issues related to access to and the quality 
of anesthesia services in the State and has concluded that it is in the 
best interests of the State's citizens to opt-out of the current 
physician supervision requirement, and that the opt-out is consistent 
with State law.
    (2) The request for exemption and recognition of State laws, and the 
withdrawal of the request may be submitted at any time, and are 
effective upon submission.

[51 FR 22042, June 17, 1986 as amended at 57 FR 33900, July 31, 1992; 66 
FR 56769, Nov. 13, 2001; 71 FR 68694, Nov. 27, 2006; 72 FR 66934, Nov. 
27, 2007]



Sec.  482.53  Condition of participation: Nuclear medicine services.

    If the hospital provides nuclear medicine services, those services 
must meet the needs of the patients in accordance with acceptable 
standards of practice.
    (a) Standard: Organization and staffing. The organization of the 
nuclear medicine service must be appropriate to the scope and complexity 
of the services offered.
    (1) There must be a director who is a doctor of medicine or 
osteopathy qualified in nuclear medicine.
    (2) The qualifications, training, functions, and responsibilities of 
nuclear medicine personnel must be specified by the service director and 
approved by the medical staff.
    (b) Standard: Delivery of service. Radioactive materials must be 
prepared, labeled, used, transported, stored, and disposed of in 
accordance with acceptable standards of practice.
    (1) In-house preparation of radiopharmaceuticals is by, or under, 
the direct supervision of an appropriately trained registered pharmacist 
or a doctor of medicine or osteopathy.
    (2) There is proper storage and disposal of radioactive material.
    (3) If laboratory tests are performed in the nuclear medicine 
service, the service must meet the applicable requirement for laboratory 
services specified in Sec.  482.27.
    (c) Standard: Facilities. Equipment and supplies must be appropriate 
for the types of nuclear medicine services offered and must be 
maintained for safe and efficient performance. The equipment must be--
    (1) Maintained in safe operating condition; and
    (2) Inspected, tested, and calibrated at least annually by qualified 
personnel.
    (d) Standard: Records. The hospital must maintain signed and dated 
reports of nuclear medicine interpretations, consultations, and 
procedures.
    (1) The hospital must maintain copies of nuclear medicine reports 
for at least 5 years.
    (2) The practitioner approved by the medical staff to interpret 
diagnostic procedures must sign and date the interpretation of these 
tests.

[[Page 28]]

    (3) The hospital must maintain records of the receipt and 
disposition of radiopharmaceuticals.
    (4) Nuclear medicine services must be ordered only by practitioner 
whose scope of Federal or State licensure and whose defined staff 
privileges allow such referrals.

[51 FR 22042, June 17, 1986, as amended at 57 FR 7136, Feb. 28, 1992]



Sec.  482.54  Condition of participation: Outpatient services.

    If the hospital provides outpatient services, the services must meet 
the needs of the patients in accordance with acceptable standards of 
practice.
    (a) Standard: Organization. Outpatient services must be 
appropriately organized and integrated with inpatient services.
    (b) Standard: Personnel. The hospitals must--
    (1) Assign an individual to be responsible for outpatient services; 
and
    (2) Have appropriate professional and nonprofessional personnel 
available.



Sec.  482.55  Condition of participation: Emergency services.

    The hospital must meet the emergency needs of patients in accordance 
with acceptable standards of practice.
    (a) Standard: Organization and direction. If emergency services are 
provided at the hospital--
    (1) The services must be organized under the direction of a 
qualified member of the medical staff;
    (2) The services must be integrated with other departments of the 
hospital;
    (3) The policies and procedures governing medical care provided in 
the emergency service or department are established by and are a 
continuing responsibility of the medical staff.
    (b) Standard: Personnel. (1) The emergency services must be 
supervised by a qualified member of the medical staff.
    (2) There must be adequate medical and nursing personnel qualified 
in emergency care to meet the written emergency procedures and needs 
anticipated by the facility.



Sec.  482.56  Condition of participation: Rehabilitation services.

    If the hospital provides rehabilitation, physical therapy, 
occupational therapy, audiology, or speech pathology services, the 
services must be organized and staffed to ensure the health and safety 
of patients.
    (a) Standard: Organization and staffing. The organization of the 
service must be appropriate to the scope of the services offered.
    (1) The director of the services must have the necessary knowledge, 
experience, and capabilities to properly supervise and administer the 
services.
    (2) Physical therapy, occupational therapy, speech-language 
pathology or audiology services, if provided, must be provided by 
qualified physical therapists, physical therapist assistants, 
occupational therapists, occupational therapy assistants, speech-
language pathologists, or audiologists as defined in part 484 of this 
chapter.
    (b) Standard: Delivery of services. Services must be given in 
accordance with orders of practitioners who are authorized by the 
medical staff to order the services, and the orders must be incorporated 
in the patient's record. The provision of care and the personnel 
qualifications must be in accordance with national acceptable standards 
of practice and must also meet the requirements of Sec.  409.17.

[51 FR 22042, June 17, 1986, as amended at 72 FR 66406, Nov. 27, 2007]



Sec.  482.57  Condition of participation: Respiratory care services.

    The hospital must meet the needs of the patients in accordance with 
acceptable standards of practice. The following requirements apply if 
the hospital provides respiratory care service.
    (a) Standard: Organization and Staffing. The organization of the 
respiratory care services must be appropriate to the scope and 
complexity of the services offered.
    (1) There must be a director of respiratory care services who is a 
doctor of medicine or osteopathy with the knowledge experience, and 
capabilities to supervise and administer the service properly. The 
director may serve on either a full-time or part-time basis.
    (2) There must be adequate numbers of respiratory therapists, 
respiratory therapy technicians, and other personnel who meet the 
qualifications

[[Page 29]]

specified by the medical staff, consistent with State law.
    (b) Standard: Delivery of Services. Services must be delivered in 
accordance with medical staff directives.
    (1) Personnel qualified to perform specific procedures and the 
amount of supervision required for personnel to carry out specific 
procedures must be designated in writing.
    (2) If blood gases or other laboratory tests are performed in the 
respiratory care unit, the unit must meet the applicable requirements 
for laboratory services specified in Sec.  482.27.
    (3) Services must be provided only on, and in accordance with, the 
orders of a doctor of medicine or osteopathy.

[51 FR 22042, June 17, 1986; 51 FR 27848, Aug. 4, 1986, as amended at 57 
FR 7136, Feb. 28, 1992]



             Subpart E_Requirements for Specialty Hospitals

    Source: 72 FR 15273, Mar. 30, 2007, unless otherwise noted.



Sec.  482.60  Special provisions applying to psychiatric hospitals.

    Psychiatric hospital must--
    (a) Be primarily engaged in providing, by or under the supervision 
of a doctor of medicine or osteopathy, psychiatric services for the 
diagnosis and treatment of mentally ill persons;
    (b) Meet the conditions of participation specified in Sec. Sec.  
482.1 through 482.23 and Sec. Sec.  482.25 through 482.57;
    (c) Maintain clinical records on all patients, including records 
sufficient to permit CMS to determine the degree and intensity of 
treatment furnished to Medicare beneficiaries, as specified in Sec.  
482.61; and
    (d) Meet the staffing requirements specified in Sec.  482.62.

[72 FR 60788, Oct. 26, 2007]



Sec.  482.61  Condition of participation: Special medical record requirements for psychiatric hospitals.

    The medical records maintained by a psychiatric hospital must permit 
determination of the degree and intensity of the treatment provided to 
individuals who are furnished services in the institution.
    (a) Standard: Development of assessment/diagnostic data. Medical 
records must stress the psychiatric components of the record, including 
history of findings and treatment provided for the psychiatric condition 
for which the patient is hospitalized.
    (1) The identification data must include the patient's legal status.
    (2) A provisional or admitting diagnosis must be made on every 
patient at the time of admission, and must include the diagnoses of 
intercurrent diseases as well as the psychiatric diagnoses.
    (3) The reasons for admission must be clearly documented as stated 
by the patient and/or others significantly involved.
    (4) The social service records, including reports of interviews with 
patients, family members, and others, must provide an assessment of home 
plans and family attitudes, and community resource contacts as well as a 
social history.
    (5) When indicated, a complete neurological examination must be 
recorded at the time of the admission physical examination.
    (b) Standard: Psychiatric evaluation. Each patient must receive a 
psychiatric evaluation that must--
    (1) Be completed within 60 hours of admission;
    (2) Include a medical history;
    (3) Contain a record of mental status;
    (4) Note the onset of illness and the circumstances leading to 
admission;
    (5) Describe attitudes and behavior;
    (6) Estimate intellectual functioning, memory functioning, and 
orientation; and
    (7) Include an inventory of the patient's assets in descriptive, not 
interpretative, fashion.
    (c) Standard: Treatment plan. (1) Each patient must have an 
individual comprehensive treatment plan that must be based on an 
inventory of the patient's strengths and disabilities. The written plan 
must include--
    (i) A substantiated diagnosis;
    (ii) Short-term and long-range goals;
    (iii) The specific treatment modalities utilized;
    (iv) The responsibilities of each member of the treatment team; and

[[Page 30]]

    (v) Adequate documentation to justify the diagnosis and the 
treatment and rehabilitation activities carried out.
    (2) The treatment received by the patient must be documented in such 
a way to assure that all active therapeutic efforts are included.
    (d) Standard: Recording progress. Progress notes must be recorded by 
the doctor of medicine or osteopathy responsible for the care of the 
patient as specified in Sec.  482.12(c), nurse, social worker and, when 
appropriate, others significantly involved in active treatment 
modalities. The frequency of progress notes is determined by the 
condition of the patient but must be recorded at least weekly for the 
first 2 months and at least once a month thereafter and must contain 
recommendations for revisions in the treatment plan as indicated as well 
as precise assessment of the patient's progress in accordance with the 
original or revised treatment plan.
    (e) Standard: Discharge planning and discharge summary. The record 
of each patient who has been discharged must have a discharge summary 
that includes a recapitulation of the patient's hospitalization and 
recommendations from appropriate services concerning follow-up or 
aftercare as well as a brief summary of the patient's condition on 
discharge.

[72 FR 60788, Oct. 26, 2007]



Sec.  482.62  Condition of participation: Special staff requirements for psychiatric hospitals.

    The hospital must have adequate numbers of qualified professional 
and supportive staff to evaluate patients, formulate written, 
individualized comprehensive treatment plans, provide active treatment 
measures, and engage in discharge planning.
    (a) Standard: Personnel. The hospital must employ or undertake to 
provide adequate numbers of qualified professional, technical, and 
consultative personnel to:
    (1) Evaluate patients;
    (2) Formulate written individualized, comprehensive treatment plans;
    (3) Provide active treatment measures; and
    (4) Engage in discharge planning.
    (b) Standard: Director of inpatient psychiatric services; medical 
staff. Inpatient psychiatric services must be under the supervision of a 
clinical director, service chief, or equivalent who is qualified to 
provide the leadership required for an intensive treatment program. The 
number and qualifications of doctors of medicine and osteopathy must be 
adequate to provide essential psychiatric services.
    (1) The clinical director, service chief, or equivalent must meet 
the training and experience requirements for examination by the American 
Board of Psychiatry and Neurology or the American Osteopathic Board of 
Neurology and Psychiatry.
    (2) The director must monitor and evaluate the quality and 
appropriateness of services and treatment provided by the medical staff.
    (c) Standard: Availability of medical personnel. Doctors of medicine 
or osteopathy and other appropriate professional personnel must be 
available to provide necessary medical and surgical diagnostic and 
treatment services. If medical and surgical diagnostic and treatment 
services are not available within the institution, the institution must 
have an agreement with an outside source of these services to ensure 
that they are immediately available or a satisfactory agreement must be 
established for transferring patients to a general hospital that 
participates in the Medicare program.
    (d) Standard: Nursing services. The hospital must have a qualified 
director of psychiatric nursing services. In addition to the director of 
nursing, there must be adequate numbers of registered nurses, licensed 
practical nurses, and mental health workers to provide nursing care 
necessary under each patient's active treatment program and to maintain 
progress notes on each patient.
    (1) The director of psychiatric nursing services must be a 
registered nurse who has a master's degree in psychiatric or mental 
health nursing, or its equivalent from a school of nursing accredited by 
the National League for Nursing, or be qualified by education and 
experience in the care of the mentally ill. The director must 
demonstrate competence to participate in

[[Page 31]]

interdisciplinary formulation of individual treatment plans; to give 
skilled nursing care and therapy; and to direct, monitor, and evaluate 
the nursing care furnished.
    (2) The staffing pattern must insure the availability of a 
registered professional nurse 24 hours each day. There must be adequate 
numbers of registered nurses, licensed practical nurses, and mental 
health workers to provide the nursing care necessary under each 
patient's active treatment program.
    (e) Standard: Psychological services. The hospital must provide or 
have available psychological services to meet the needs of the patients.
    (f) Standard: Social services. There must be a director of social 
services who monitors and evaluates the quality and appropriateness of 
social services furnished. The services must be furnished in accordance 
with accepted standards of practice and established policies and 
procedures.
    (1) The director of the social work department or service must have 
a master's degree from an accredited school of social work or must be 
qualified by education and experience in the social services needs of 
the mentally ill. If the director does not hold a masters degree in 
social work, at least one staff member must have this qualification.
    (2) Social service staff responsibilities must include, but are not 
limited to, participating in discharge planning, arranging for follow-up 
care, and developing mechanisms for exchange of appropriate, information 
with sources outside the hospital.
    (g) Standard: Therapeutic activities. The hospital must provide a 
therapeutic activities program.
    (1) The program must be appropriate to the needs and interests of 
patients and be directed toward restoring and maintaining optimal levels 
of physical and psychosocial functioning.
    (2) The number of qualified therapists, support personnel, and 
consultants must be adequate to provide comprehensive therapeutic 
activities consistent with each patient's active treatment program.

[72 FR 60788, Oct. 26, 2007]



Sec.  482.66  Special requirements for hospital providers of long-term care services (``swing-beds'').

    A hospital that has a Medicare provider agreement must meet the 
following requirements in order to be granted an approval from CMS to 
provide post-hospital extended care services, as specified in Sec.  
409.30 of this chapter, and be reimbursed as a swing-bed hospital, as 
specified in Sec.  413.114 of this chapter:
    (a) Eligibility. A hospital must meet the following eligibility 
requirements:
    (1) The facility has fewer than 100 hospital beds, excluding beds 
for newborns and beds in intensive care type inpatient units (for 
eligibility of hospitals with distinct parts electing the optional 
reimbursement method, see Sec.  413.24(d)(5) of this chapter).
    (2) The hospital is located in a rural area. This includes all areas 
not delineated as ``urbanized'' areas by the Census Bureau, based on the 
most recent census.
    (3) The hospital does not have in effect a 24-hour nursing waiver 
granted under Sec.  488.54(c) of this chapter.
    (4) The hospital has not had a swing-bed approval terminated within 
the two years previous to application.
    (b) Skilled nursing facility services. The facility is substantially 
in compliance with the following skilled nursing facility requirements 
contained in subpart B of part 483 of this chapter.
    (1) Resident rights (Sec.  483.10 (b)(3), (b)(4), (b)(5), (b)(6), 
(d), (e), (h), (i), (j)(1)(vii), (j)(1)(viii), (l), and (m)).
    (2) Admission, transfer, and discharge rights (Sec.  483.12 (a)(1), 
(a)(2), (a)(3), (a)(4), (a)(5), (a)(6), and (a)(7)).
    (3) Resident behavior and facility practices (Sec.  483.13).
    (4) Patient activities (Sec.  483.15(f)).
    (5) Social services (Sec.  483.15(g)).
    (6) Discharge planning (Sec.  483.20(e)).
    (7) Specialized rehabilitative services (Sec.  483.45).
    (8) Dental services (Sec.  483.55).

[72 FR 60788, Oct. 26, 2007]



Sec.  482.68  Special requirements for transplant centers.

    A transplant center located within a hospital that has a Medicare 
provider agreement must meet the conditions of participation specified 
in Sec. Sec.  482.72

[[Page 32]]

through 482.104 in order to be granted approval from CMS to provide 
transplant services.
    (a) Unless specified otherwise, the conditions of participation at 
Sec. Sec.  482.72 through 482.104 apply to heart, heart-lung, intestine, 
kidney, liver, lung, and pancreas centers.
    (b) In addition to meeting the conditions of participation specified 
in Sec. Sec.  482.72 through 482.104, a transplant center must also meet 
the conditions of participation specified in Sec. Sec.  482.1 through 
482.57.



Sec.  482.70  Definitions.

    As used in this subpart, the following definitions apply:
    Adverse event means an untoward, undesirable, and usually 
unanticipated event that causes death or serious injury, or the risk 
thereof. As applied to transplant centers, examples of adverse events 
include (but are not limited to) serious medical complications or death 
caused by living donation; unintentional transplantation of organs of 
mismatched blood types; transplantation of organs to unintended 
recipients; and unintended transmission of infectious disease to a 
recipient.
    End-Stage Renal Disease (ESRD) means that stage of renal impairment 
that appears irreversible and permanent, and requires a regular course 
of dialysis or kidney transplantation to maintain life.
    ESRD Network means all Medicare-approved ESRD facilities in a 
designated geographic area specified by CMS.
    Heart-Lung transplant center means a transplant center that is 
located in a hospital with an existing Medicare-approved heart 
transplant center and an existing Medicare-approved lung center that 
performs combined heart-lung transplants.
    Intestine transplant center means a Medicare-approved liver 
transplant center that performs intestine transplants, combined liver-
intestine transplants, or multivisceral transplants.
    Network organization means the administrative governing body to the 
network and liaison to the Federal government.
    Pancreas transplant center means a Medicare-approved kidney 
transplant center that performs pancreas transplants alone or subsequent 
to a kidney transplant as well as kidney-pancreas transplants.
    Transplant center means an organ-specific transplant program (as 
defined in this rule) within a transplant hospital (for example, a 
hospital's lung transplant program may also be referred to as the 
hospital's lung transplant center).
    Transplant hospital means a hospital that furnishes organ 
transplants and other medical and surgical specialty services required 
for the care of transplant patients.
    Transplant program means a component within a transplant hospital 
(as defined in this rule) that provides transplantation of a particular 
type of organ.

               General Requirements for Transplant Centers



Sec.  482.72  Condition of participation: OPTN membership.

    A transplant center must be located in a transplant hospital that is 
a member of and abides by the rules and requirements of the Organ 
Procurement and Transplantation Network (OPTN) established and operated 
in accordance with section 372 of the Public Health Service (PHS) Act 
(42 U.S.C. 274). The term ``rules and requirements of the OPTN'' means 
those rules and requirements approved by the Secretary pursuant to Sec.  
121.4 of this title. No hospital that provides transplantation services 
shall be deemed to be out of compliance with section 1138(a)(1)(B) of 
the Act or this section unless the Secretary has given the OPTN formal 
notice that he or she approves the decision to exclude the transplant 
hospital from the OPTN and also has notified the transplant hospital in 
writing.



Sec.  482.74  Condition of participation: Notification to CMS.

    (a) A transplant center must notify CMS immediately of any 
significant changes related to the center's transplant program or 
changes that could affect its compliance with the conditions of 
participation. Instances in which CMS should receive information

[[Page 33]]

for follow up, as appropriate, include, but are not limited to:
    (1) Change in key staff members of the transplant team, such as a 
change in the individual the transplant center designated to the OPTN as 
the center's ``primary transplant surgeon'' or ``primary transplant 
physician;'
    (2) A decrease in the center's number of transplants or survival 
rates that could result in the center being out of compliance with Sec.  
482.82;
    (3) Termination of an agreement between the hospital in which the 
transplant center is located and an OPO for the recovery and receipt of 
organs as required by section 482.100; and
    (4) Inactivation of the transplant center.
    (b) Upon receiving notification of significant changes, CMS will 
follow up with the transplant center as appropriate, including (but not 
limited to):
    (1) Requesting additional information;
    (2) Analyzing the information; or
    (3) Conducting an on-site review.



Sec.  482.76  Condition of participation: Pediatric Transplants.

    A transplant center that seeks Medicare approval to provide 
transplantation services to pediatric patients must submit to CMS a 
request specifically for Medicare approval to perform pediatric 
transplants using the procedures described at Sec.  488.61 of this 
chapter.
    (a) Except as specified in paragraph (d) of this section, a center 
requesting Medicare approval to perform pediatric transplants must meet 
all the conditions of participation at Sec. Sec.  482.72 through 482.74 
and Sec. Sec.  482.80 through 482.104 with respect to its pediatric 
patients.
    (b) A center that performs 50 percent or more of its transplants in 
a 12-month period on adult patients must be approved to perform adult 
transplants in order to be approved to perform pediatric transplants.
    (1) Loss of Medicare approval to perform adult transplants, whether 
voluntary or involuntary, will result in loss of the center's approval 
to perform pediatric transplants.
    (2) Loss of Medicare approval to perform pediatric transplants, 
whether voluntary or involuntary, may trigger a review of the center's 
Medicare approval to perform adult transplants.
    (c) A center that performs 50 percent or more of its transplants in 
a 12-month period on pediatric patients must be approved to perform 
pediatric transplants in order to be approved to perform adult 
transplants.
    (1) Loss of Medicare approval to perform pediatric transplants, 
whether voluntary or involuntary, will result in loss of the center's 
approval to perform adult transplants.
    (2) Loss of Medicare approval to perform adult transplants, whether 
voluntary or involuntary, may trigger a review of the center's Medicare 
approval to perform pediatric transplants.
    (3) A center that performs 50 percent or more of its transplants on 
pediatric patients in a 12-month period is not required to meet the 
clinical experience requirements prior to its request for approval as a 
pediatric transplant center.
    (d) Instead of meeting all conditions of participation at Sec. Sec.  
482.72 through 482.74 and Sec. Sec.  482.80 through 482.104, a heart 
transplant center that wishes to provide transplantation services to 
pediatric heart patients may be approved to perform pediatric heart 
transplants by meeting the Omnibus Budget Reconciliation Act of 1987 
criteria in section 4009(b) (Pub. L. 100-203), as follows:
    (1) The center's pediatric transplant program must be operated 
jointly by the hospital and another facility that is Medicare-approved;
    (2) The unified program shares the same transplant surgeons and 
quality improvement program (including oversight committee, patient 
protocol, and patient selection criteria); and
    (3) The center demonstrates to the satisfaction of the Secretary 
that it is able to provide the specialized facilities, services, and 
personnel that are required by pediatric heart transplant patients.

[[Page 34]]

  Transplant Center Data Submission, Clinical Experience, and Outcome 
                              Requirements



Sec.  482.80  Condition of participation: Data submission, clinical experience, and outcome requirements for initial approval of transplant centers.

    Except as specified in paragraph (d) of this section, and Sec.  
488.61 of this chapter, transplant centers must meet all data 
submission, clinical experience, and outcome requirements to be granted 
initial approval by CMS.
    (a) Standard: Data submission. No later than 90 days after the due 
date established by the OPTN, a transplant center must submit to the 
OPTN at least 95 percent of required data on all transplants (deceased 
and living donor) it has performed. Required data submissions include, 
but are not limited to, submission of the appropriate OPTN forms for 
transplant candidate registration, transplant recipient registration and 
follow-up, and living donor registration and follow-up.
    (b) Standard: Clinical experience. To be considered for initial 
approval, an organ-specific transplant center must generally perform 10 
transplants over a 12-month period.
    (c) Standard: Outcome requirements. CMS will review outcomes for all 
transplants performed at a center, including outcomes for living donor 
transplants, if applicable. Except for lung transplants, CMS will review 
adult and pediatric outcomes separately when a center requests Medicare 
approval to perform both adult and pediatric transplants.
    (1) CMS will compare each transplant center's observed number of 
patient deaths and graft failures 1-year post-transplant to the center's 
expected number of patient deaths and graft failures 1-year post-
transplant using the data contained in the most recent Scientific 
Registry of Transplant Recipients (SRTR) center-specific report.
    (2) The required number of transplants must have been performed 
during the time frame reported in the most recent SRTR center-specific 
report.
    (3) CMS will not consider a center's patient and graft survival 
rates to be acceptable if:
    (i) A center's observed patient survival rate or observed graft 
survival rate is lower than its expected patient survival rate or 
expected graft survival rate; and
    (ii) All three of the following thresholds are crossed over:
    (A) The one-sided p-value is less than 0.05,
    (B) The number of observed events (patient deaths or graft failures) 
minus the number of expected events is greater than 3, and
    (C) The number of observed events divided by the number of expected 
events is greater than 1.5.
    (d) Exceptions. (1) A heart-lung transplant center is not required 
to comply with the clinical experience requirements in paragraph (b) of 
this section or the outcome requirements in paragraph (c) of this 
section for heart-lung transplants performed at the center.
    (2) An intestine transplant center is not required to comply with 
the outcome performance requirements in paragraph (c) of this section 
for intestine, combined liver-intestine or multivisceral transplants 
performed at the center.
    (3) A pancreas transplant center is not required to comply with the 
clinical experience requirements in paragraph (b) of this section or the 
outcome requirements in paragraph (c) of this section for pancreas 
transplants performed at the center.
    (4) A center that is requesting initial Medicare approval to perform 
pediatric transplants is not required to comply with the clinical 
experience requirements in paragraph (b) of this section prior to its 
request for approval as a pediatric transplant center.
    (5) A kidney transplant center that is not Medicare-approved on the 
effective date of this rule is required to perform at least 3 
transplants over a 12-month period prior to its request for initial 
approval.



Sec.  482.82  Condition of participation: Data submission, clinical experience, and outcome requirements for re-approval of transplant centers.

    Except as specified in paragraph (d) of this section, and Sec.  
488.61 of this chapter, transplant centers must meet all data 
submission, clinical experience,

[[Page 35]]

and outcome requirements in order to be re-approved.
    (a) Standard: Data submission. No later than 90 days after the due 
date established by the OPTN, a transplant center must submit to the 
OPTN at least 95 percent of the required data submissions on all 
transplants (deceased and living donor) it has performed over the 3-year 
approval period. Required data submissions include, but are not limited 
to, submission of the appropriate OPTN forms for transplant candidate 
registration, transplant recipient registration and follow-up, and 
living donor registration and follow-up.
    (b) Standard: Clinical experience. To be considered for re-approval, 
an organ-specific transplant center must generally perform an average of 
10 transplants per year during the re-approval period.
    (c) Standard: Outcome requirements. CMS will review outcomes for all 
transplants performed at a center, including outcomes for living donor 
transplants if applicable. Except for lung transplants, CMS will review 
adult and pediatric outcomes separately when a center requests Medicare 
approval to perform both adult and pediatric transplants.
    (1) CMS will compare each transplant center's observed number of 
patient deaths and graft failures 1-year post-transplant to the center's 
expected number of patient deaths and graft failures 1-year post-
transplant using data contained in the most recent SRTR center-specific 
report.
    (2) The required number of transplants must have been performed 
during the time frame reported in the most recent SRTR center-specific 
report.
    (3) CMS will not consider a center's patient and graft survival 
rates to be acceptable if:
    (i) A center's observed patient survival rate or observed graft 
survival rate is lower than its expected patient survival rate and graft 
survival rate; and
    (ii) All three of the following thresholds are crossed over:
    (A) The one-sided p-value is less than 0.05,
    (B) The number of observed events (patient deaths or graft failures) 
minus the number of expected events is greater than 3, and
    (C) The number of observed events divided by the number of expected 
events is greater than 1.5.
    (d) Exceptions. (1) A heart-lung transplant center is not required 
to comply with the clinical experience requirements in paragraph (b) of 
this section or the outcome requirements in paragraph (c) of this 
section for heart-lung transplants performed at the center.
    (2) An intestine transplant center is not required to comply with 
the outcome requirements in paragraph (c) of this section for intestine, 
combined liver-intestine, and multivisceral transplants performed at the 
center.
    (3) A pancreas transplant center is not required to comply with the 
clinical experience requirements in paragraph (b) of this section or the 
outcome requirements in paragraph (c) of this section for pancreas 
transplants performed at the center.
    (4) A center that is approved to perform pediatric transplants is 
not required to comply with the clinical experience requirements in 
paragraph (b) of this section to be re-approved.

                 Transplant Center Process Requirements



Sec.  482.90  Condition of participation: Patient and living donor selection.

    The transplant center must use written patient selection criteria in 
determining a patient's suitability for placement on the waiting list or 
a patient's suitability for transplantation. If a center performs living 
donor transplants, the center also must use written donor selection 
criteria in determining the suitability of candidates for donation.
    (a) Standard: Patient selection. Patient selection criteria must 
ensure fair and non-discriminatory distribution of organs.
    (1) Prior to placement on the center's waiting list, a prospective 
transplant candidate must receive a psychosocial evaluation, if 
possible.
    (2) Before a transplant center places a transplant candidate on its 
waiting list, the candidate's medical record must contain documentation 
that the

[[Page 36]]

candidate's blood type has been determined.
    (3) When a patient is placed on a center's waiting list or is 
selected to receive a transplant, the center must document in the 
patient's medical record the patient selection criteria used.
    (4) A transplant center must provide a copy of its patient selection 
criteria to a transplant patient, or a dialysis facility, as requested 
by a patient or a dialysis facility.
    (b) Standard: Living donor selection. The living donor selection 
criteria must be consistent with the general principles of medical 
ethics. Transplant centers must:
    (1) Ensure that a prospective living donor receives a medical and 
psychosocial evaluation prior to donation,
    (2) Document in the living donor's medical records the living 
donor's suitability for donation, and
    (3) Document that the living donor has given informed consent, as 
required under Sec.  482.102.



Sec.  482.92  Condition of participation: Organ recovery and receipt.

    Transplant centers must have written protocols for validation of 
donor-recipient blood type and other vital data for the deceased organ 
recovery, organ receipt, and living donor organ transplantation 
processes. The transplanting surgeon at the transplant center is 
responsible for ensuring the medical suitability of donor organs for 
transplantation into the intended recipient.
    (a) Standard: Organ recovery. When the identity of an intended 
transplant recipient is known and the transplant center sends a team to 
recover the organ(s), the transplant center's recovery team must review 
and compare the donor data with the recipient blood type and other vital 
data before organ recovery takes place.
    (b) Standard: Organ receipt. After an organ arrives at a transplant 
center, prior to transplantation, the transplanting surgeon and another 
licensed health care professional must verify that the donor's blood 
type and other vital data are compatible with transplantation of the 
intended recipient
    (c) Standard: Living donor transplantation. If a center performs 
living donor transplants, the transplanting surgeon and another licensed 
health care professional at the center must verify that the living 
donor's blood type and other vital data are compatible with 
transplantation of the intended recipient immediately before the removal 
of the donor organ(s) and, if applicable, prior to the removal of the 
recipient's organ(s).



Sec.  482.94  Condition of participation: Patient and living donor management.

    Transplant centers must have written patient management policies for 
the transplant and discharge phases of transplantation. If a transplant 
center performs living donor transplants, the center also must have 
written donor management policies for the donor evaluation, donation, 
and discharge phases of living organ donation.
    (a) Standard: Patient and living donor care. The transplant center's 
patient and donor management policies must ensure that:
    (1) Each transplant patient is under the care of a multidisciplinary 
patient care team coordinated by a physician throughout the transplant 
and discharge phases of transplantation; and
    (2) If a center performs living donor transplants, each living donor 
is under the care of a multidisciplinary patient care team coordinated 
by a physician throughout the donor evaluation, donation, and discharge 
phases of donation.
    (b) Standard: Waiting list management. Transplant centers must keep 
their waiting lists up to date on an ongoing basis, including:
    (1) Updating of waiting list patients' clinical information;
    (2) Removing patients from the center's waiting list if a patient 
receives a transplant or dies, or if there is any other reason the 
patient should no longer be on a center's waiting list; and
    (3) Notifying the OPTN no later than 24 hours after a patient's 
removal from the center's waiting list.
    (c) Standard: Patient records. Transplant centers must maintain up-
to-date and accurate patient management records for each patient who 
receives

[[Page 37]]

an evaluation for placement on a center's waiting list and who is 
admitted for organ transplantation.
    (1) For each patient who receives an evaluation for placement on a 
center's waiting list, the center must document in the patient's record 
that the patient (and in the case of a kidney patient, the patient's 
usual dialysis facility) has been informed of his or her transplant 
status, including notification of:
    (i) The patient's placement on the center's waiting list;
    (ii) The center's decision not to place the patient on its waiting 
list; or
    (iii) The center's inability to make a determination regarding the 
patient's placement on its waiting list because further clinical testing 
or documentation is needed.
    (2) If a patient on the waiting list is removed from the waiting 
list for any reason other than death or transplantation, the transplant 
center must document in the patient's record that the patient (and in 
the case of a kidney patient, the patient's usual dialysis facility) was 
notified no later than 10 days after the date the patient was removed 
from the waiting list.
    (3) In the case of patients admitted for organ transplants, 
transplant centers must maintain written records of:
    (i) Multidisciplinary patient care planning during the transplant 
period; and
    (ii) Multidisciplinary discharge planning for post-transplant care.
    (d) Standard: Social services. The transplant center must make 
social services available, furnished by qualified social workers, to 
transplant patients, living donors, and their families. A qualified 
social worker is an individual who meets licensing requirements in the 
State in which he or she practices; and
    (1) Completed a course of study with specialization in clinical 
practice and holds a master's degree from a graduate school of social 
work accredited by the Council on Social Work Education; or
    (2) Is working as a social worker in a transplant center as of the 
effective date of this final rule and has served for at least 2 years as 
a social worker, 1 year of which was in a transplantation program, and 
has established a consultative relationship with a social worker who is 
qualified under (d)(1) of this paragraph.
    (e) Standard: Nutritional services. Transplant centers must make 
nutritional assessments and diet counseling services, furnished by a 
qualified dietitian, available to all transplant patients and living 
donors. A qualified dietitian is an individual who meets practice 
requirements in the State in which he or she practices and is a 
registered dietitian with the Commission on Dietetic Registration.



Sec.  482.96  Condition of participation: Quality assessment and performance improvement (QAPI).

    Transplant centers must develop, implement, and maintain a written, 
comprehensive, data-driven QAPI program designed to monitor and evaluate 
performance of all transplantation services, including services provided 
under contract or arrangement.
    (a) Standard: Components of a QAPI program. The transplant center's 
QAPI program must use objective measures to evaluate the center's 
performance with regard to transplantation activities and outcomes. 
Outcome measures may include, but are not limited to, patient and donor 
selection criteria, accuracy of the waiting list in accordance with the 
OPTN waiting list requirements, accuracy of donor and recipient 
matching, patient and donor management, techniques for organ recovery, 
consent practices, patient education, patient satisfaction, and patient 
rights. The transplant center must take actions that result in 
performance improvements and track performance to ensure that 
improvements are sustained.
    (b) Standard: Adverse events. A transplant center must establish and 
implement written policies to address and document adverse events that 
occur during any phase of an organ transplantation case.
    (1) The policies must address, at a minimum, the process for the 
identification, reporting, analysis, and prevention of adverse events.
    (2) The transplant center must conduct a thorough analysis of and 
document any adverse event and must utilize the analysis to effect 
changes in

[[Page 38]]

the transplant center's policies and practices to prevent repeat 
incidents.



Sec.  482.98  Condition of participation: Human resources.

    The transplant center must ensure that all individuals who provide 
services and/or supervise services at the center, including individuals 
furnishing services under contract or arrangement, are qualified to 
provide or supervise such services.
    (a) Standard: Director of a transplant center. The transplant center 
must be under the general supervision of a qualified transplant surgeon 
or a qualified physician-director. The director of a transplant center 
need not serve full-time and may also serve as a center's primary 
transplant surgeon or transplant physician in accordance with Sec.  
482.98(b). The director is responsible for planning, organizing, 
conducting, and directing the transplant center and must devote 
sufficient time to carry out these responsibilities, which include but 
are not limited to the following:
    (1) Coordinating with the hospital in which the transplant center is 
located to ensure adequate training of nursing staff and clinical 
transplant coordinators in the care of transplant patients and living 
donors.
    (2) Ensuring that tissue typing and organ procurement services are 
available.
    (3) Ensuring that transplantation surgery is performed by, or under 
the direct supervision of, a qualified transplant surgeon in accordance 
with Sec.  482.98(b).
    (b) Standard: Transplant surgeon and physician. The transplant 
center must identify to the OPTN a primary transplant surgeon and a 
transplant physician with the appropriate training and experience to 
provide transplantation services, who are immediately available to 
provide transplantation services when an organ is offered for 
transplantation.
    (1) The transplant surgeon is responsible for providing surgical 
services related to transplantation.
    (2) The transplant physician is responsible for providing and 
coordinating transplantation care.
    (c) Standard: Clinical transplant coordinator. The transplant center 
must have a clinical transplant coordinator to ensure the continuity of 
care of patients and living donors during the pre-transplant, 
transplant, and discharge phases of transplantation and the donor 
evaluation, donation, and discharge phases of donation. The clinical 
transplant coordinator must be a registered nurse or clinician licensed 
by the State in which the clinical transplant coordinator practices, who 
has experience and knowledge of transplantation and living donation 
issues. The clinical transplant coordinator's responsibilities must 
include, but are not limited to, the following:
    (1) Ensuring the coordination of the clinical aspects of transplant 
patient and living donor care; and
    (2) Acting as a liaison between a kidney transplant center and 
dialysis facilities, as applicable.
    (d) Standard: Independent living donor advocate or living donor 
advocate team. The transplant center that performs living donor 
transplantation must identify either an independent living donor 
advocate or an independent living donor advocate team to ensure 
protection of the rights of living donors and prospective living donors.
    (1) The living donor advocate or living donor advocate team must not 
be involved in transplantation activities on a routine basis.
    (2) The independent living donor advocate or living donor advocate 
team must demonstrate:
    (i) Knowledge of living organ donation, transplantation, medical 
ethics, and informed consent; and
    (ii) Understanding of the potential impact of family and other 
external pressures on the prospective living donor's decision whether to 
donate and the ability to discuss these issues with the donor.
    (3) The independent living donor advocate or living donor advocate 
team is responsible for:
    (i) Representing and advising the donor;
    (ii) Protecting and promoting the interests of the donor; and
    (iii) Respecting the donor's decision and ensuring that the donor's 
decision is informed and free from coercion.

[[Page 39]]

    (e) Standard: Transplant team. The transplant center must identify a 
multidisciplinary transplant team and describe the responsibilities of 
each member of the team. The team must be composed of individuals with 
the appropriate qualifications, training, and experience in the relevant 
areas of medicine, nursing, nutrition, social services, transplant 
coordination, and pharmacology.
    (f) Standard: Resource commitment. The transplant center must 
demonstrate availability of expertise in internal medicine, surgery, 
anesthesiology, immunology, infectious disease control, pathology, 
radiology, blood banking, and patient education as related to the 
provision of transplantation services.



Sec.  482.100  Condition of participation: Organ procurement.

    The transplant center must ensure that the hospital in which it 
operates has a written agreement for the receipt of organs with an OPO 
designated by the Secretary that identifies specific responsibilities 
for the hospital and for the OPO with respect to organ recovery and 
organ allocation.



Sec.  482.102  Condition of participation: Patient and living donor rights.

    In addition to meeting the condition of participation ``Patients 
rights'' requirements at Sec.  482.13, the transplant center must 
protect and promote each transplant patient's and living donor's rights.
    (a) Standard: Informed consent for transplant patients. Transplant 
centers must implement written transplant patient informed consent 
policies that inform each patient of:
    (1) The evaluation process;
    (2) The surgical procedure;
    (3) Alternative treatments;
    (4) Potential medical or psychosocial risks;
    (5) National and transplant center-specific outcomes, from the most 
recent SRTR center-specific report, including (but not limited to) the 
transplant center's observed and expected 1-year patient and graft 
survival, national 1-year patient and graft survival, and notification 
about all Medicare outcome requirements not being met by the transplant 
center;
    (6) Organ donor risk factors that could affect the success of the 
graft or the health of the patient, including, but not limited to, the 
donor's history, condition or age of the organs used, or the patient's 
potential risk of contracting the human immunodeficiency virus and other 
infectious diseases if the disease cannot be detected in an infected 
donor;
    (7) His or her right to refuse transplantation; and
    (8) The fact that if his or her transplant is not provided in a 
Medicare-approved transplant center it could affect the transplant 
recipient's ability to have his or her immunosuppressive drugs paid for 
under Medicare Part B.
    (b) Standard: Informed consent for living donors. Transplant centers 
must implement written living donor informed consent policies that 
inform the prospective living donor of all aspects of, and potential 
outcomes from, living donation. Transplant centers must ensure that the 
prospective living donor is fully informed about the following:
    (1) The fact that communication between the donor and the transplant 
center will remain confidential, in accordance with the requirements at 
45 CFR parts 160 and 164.
    (2) The evaluation process;
    (3) The surgical procedure, including post-operative treatment;
    (4) The availability of alternative treatments for the transplant 
recipient;
    (5) The potential medical or psychosocial risks to the donor;
    (6) The national and transplant center-specific outcomes for 
recipients, and the national and center-specific outcomes for living 
donors, as data are available;
    (7) The possibility that future health problems related to the 
donation may not be covered by the donor's insurance and that the 
donor's ability to obtain health, disability, or life insurance may be 
affected;
    (8) The donor's right to opt out of donation at any time during the 
donation process; and

[[Page 40]]

    (9) The fact that if a transplant is not provided in a Medicare-
approved transplant center it could affect the transplant recipient's 
ability to have his or her immunosuppressive drugs paid for under 
Medicare Part B.
    (c) Standard: Notification to patients. Transplant centers must 
notify patients placed on the center's waiting list of information about 
the center that could impact the patient's ability to receive a 
transplant should an organ become available, and what procedures are in 
place to ensure the availability of a transplant team.
    (1) A transplant center served by a single transplant surgeon or 
physician must inform patients placed on the center's waiting list of:
    (i) The potential unavailability of the transplant surgeon or 
physician; and
    (ii) Whether the center has a mechanism to provide an alternate 
transplant surgeon or transplant physician.
    (2) At least 30 days before a center's Medicare approval is 
terminated, whether voluntarily or involuntarily, the center must:
    (i) Inform patients on the center's waiting list and provide 
assistance to waiting list patients who choose to transfer to the 
waiting list of another Medicare-approved transplant center without loss 
of time accrued on the waiting list; and
    (ii) Inform Medicare beneficiaries on the center's waiting list that 
Medicare will no longer pay for transplants performed at the center 
after the effective date of the center's termination of approval.
    (3) As soon as possible prior to a transplant center's voluntary 
inactivation, the center must inform patients on the center's waiting 
list and, as directed by the Secretary, provide assistance to waiting 
list patients who choose to transfer to the waiting list of another 
Medicare-approved transplant center without loss of time accrued on the 
waiting list.



Sec.  482.104  Condition of participation: Additional requirements for kidney transplant centers.

    (a) Standard: End stage renal disease (ESRD) services. Kidney 
transplant centers must directly furnish transplantation and other 
medical and surgical specialty services required for the care of ESRD 
patients. A kidney transplant center must have written policies and 
procedures for ongoing communications with dialysis patients' local 
dialysis facilities.
    (b) Standard: Dialysis services. Kidney transplant centers must 
furnish inpatient dialysis services directly or under arrangement.
    (c) Standard: Participation in network activities. Kidney transplant 
centers must cooperate with the ESRD Network designated for their 
geographic area, in fulfilling the terms of the Network's current 
statement of work.



PART 483_REQUIREMENTS FOR STATES AND LONG TERM CARE FACILITIES--Table of Contents




Subpart A [Reserved]

          Subpart B_Requirements for Long Term Care Facilities

Sec.
483.1 Basis and scope.
483.5 Definitions.
483.10 Resident rights.
483.12 Admission, transfer and discharge rights.
483.13 Resident behavior and facility practices.
483.15 Quality of life.
483.20 Resident assessment.
483.25 Quality of care.
483.30 Nursing services.
483.35 Dietary services.
483.40 Physician services.
483.45 Specialized rehabilitative services.
483.55 Dental services.
483.60 Pharmacy services.
483.65 Infection control.
483.70 Physical environment.
483.75 Administration.

 Subpart C_Preadmission Screening and Annual Review of Mentally Ill and 
                      Mentally Retarded Individuals

483.100 Basis.
483.102 Applicability and definitions.
483.104 State plan requirement.
483.106 Basic rule.
483.108 Relationship of PASARR to other Medicaid processes.
483.110 Out-of-State arrangements.
483.112 Preadmission screening of applicants for admission to NFs.
483.114 Annual review of NF residents.
483.116 Residents and applicants determined to require NF level of 
          services.

[[Page 41]]

483.118 Residents and applicants determined not to require NF level of 
          services.
483.120 Specialized services.
483.122 FFP for NF services.
483.124 FFP for specialized services.
483.126 Appropriate placement.
483.128 PASARR evaluation criteria.
483.130 PASARR determination criteria.
483.132 Evaluating the need for NF services and NF level of care 
          (PASARR/NF).
483.134 Evaluating whether an individual with mental illness requires 
          specialized services (PASARR/MI).
483.136 Evaluating whether an individual with mental retardation 
          requires specialized services (PASARR/MR).
483.138 Maintenance of services and availability of FFP.

 Subpart D_Requirements That Must Be Met by States and State Agencies: 
    Nurse Aide Training and Competency Evaluation; and Paid Feeding 
                               Assistants

483.150 Statutory basis; Deemed meeting or waiver of requirements.
483.151 State review and approval of nurse aide training and competency 
          evaluation programs and competency evaluation programs.
483.152 Requirements for approval of a nurse aide training and 
          competency evaluation program.
483.154 Nurse aide competency evaluation.
483.156 Registry of nurse aides.
483.158 FFP for nurse aide training and competency evaluation.
483.160 Requirements for training of paid feeding assistants.

 Subpart E_Appeals of Discharges, Transfers, and Preadmission Screening 
           and Annual Resident Review (PASARR) Determinations

483.200 Statutory basis.
483.202 Definitions.
483.204 Provision of a hearing and appeal system.
483.206 Transfers, discharges and relocations subject to appeal.

 Subpart F_Requirements That Must Be Met by States and State Agencies, 
                           Resident Assessment

483.315 Specification of resident assessment instrument.

    Subpart G_Condition of Participation for the Use of Restraint or 
  Seclusion in Psychiatric Residential Treatment Facilities Providing 
       Inpatient Psychiatric Services for Individuals Under Age 21

483.350 Basis and scope.
483.352 Definitions.
483.354 General requirements for psychiatric residential treatment 
          facilities.
483.356 Protection of residents.
483.358 Orders for the use of restraint or seclusion.
483.360 Consultation with treatment team physician.
483.362 Monitoring of the resident in and immediately after restraint.
483.364 Monitoring of the resident in and immediately after seclusion.
483.366 Notification of parent(s) or legal guardian(s).
483.368 Application of time out.
483.370 Postintervention debriefings.
483.372 Medical treatment for injuries resulting from an emergency 
          safety intervention.
483.374 Facility reporting.
483.376 Education and training.

Subpart H [Reserved]

 Subpart I_Conditions of Participation for Intermediate Care Facilities 
                        for the Mentally Retarded

483.400 Basis and purpose.
483.405 Relationship to other HHS regulations.
483.410 Condition of participation: Governing body and management.
483.420 Condition of participation: Client protections.
483.430 Condition of participation: Facility staffing.
483.440 Condition of participation: Active treatment services.
483.450 Condition of participation: Client behavior and facility 
          practices.
483.460 Condition of participation: Health care services.
483.470 Condition of participation: Physical environment.
483.480 Condition of participation: Dietetic services.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395hh).

Subpart A [Reserved]



          Subpart B_Requirements for Long Term Care Facilities

    Source: 54 FR 5359, Feb. 2, 1989, unless otherwise noted.



Sec.  483.1  Basis and scope.

    (a) Statutory basis. (1) Sections 1819 (a), (b), (c), and (d) of the 
Act provide that--

[[Page 42]]

    (i) Skilled nursing facilities participating in Medicare must meet 
certain specified requirements; and
    (ii) The Secretary may impose additional requirements (see section 
1819(d)(4)(B)) if they are necessary for the health and safety of 
individuals to whom services are furnished in the facilities.
    (2) Section 1861(l) of the Act requires the facility to have in 
effect a transfer agreement with a hospital.
    (3) Sections 1919 (a), (b), (c), and (d) of the Act provide that 
nursing facilities participating in Medicaid must meet certain specific 
requirements.
    (b) Scope. The provisions of this part contain the requirements that 
an institution must meet in order to qualify to participate as a SNF in 
the Medicare program, and as a nursing facility in the Medicaid program. 
They serve as the basis for survey activities for the purpose of 
determining whether a facility meets the requirements for participation 
in Medicare and Medicaid.

[56 FR 48867, Sept. 26, 1991, as amended at 57 FR 43924, Sept. 23, 1992; 
60 FR 50443, Sept. 29, 1995]



Sec.  483.5  Definitions.

    (a) Facility defined. For purposes of this subpart, facility means a 
skilled nursing facility (SNF) that meets the requirements of sections 
1819(a), (b), (c), and (d) of the Act, or a nursing facility (NF) that 
meets the requirements of sections 1919(a), (b), (c), and (d) of the 
Act. ``Facility'' may include a distinct part of an institution (as 
defined in paragraph (b) of this section and specified in Sec.  440.40 
and Sec.  440.155 of this chapter), but does not include an institution 
for the mentally retarded or persons with related conditions described 
in Sec.  440.150 of this chapter. For Medicare and Medicaid purposes 
(including eligibility, coverage, certification, and payment), the 
``facility'' is always the entity that participates in the program, 
whether that entity is comprised of all of, or a distinct part of, a 
larger institution. For Medicare, an SNF (see section 1819(a)(1) of the 
Act), and for Medicaid, an NF (see section 1919(a)(1) of the Act) may 
not be an institution for mental diseases as defined in Sec.  435.1010 
of this chapter.
    (b) Distinct part--(1) Definition. A distinct part SNF or NF is 
physically distinguishable from the larger institution or institutional 
complex that houses it, meets the requirements of this paragraph and of 
paragraph (b)(2) of this section, and meets the applicable statutory 
requirements for SNFs or NFs in sections 1819 or 1919 of the Act, 
respectively. A distinct part SNF or NF may be comprised of one or more 
buildings or designated parts of buildings (that is, wings, wards, or 
floors) that are: In the same physical area immediately adjacent to the 
institution's main buildings; other areas and structures that are not 
strictly contiguous to the main buildings but are located within close 
proximity of the main buildings; and any other areas that CMS determines 
on an individual basis, to be part of the institution's campus. A 
distinct part must include all of the beds within the designated area, 
and cannot consist of a random collection of individual rooms or beds 
that are scattered throughout the physical plant. The term ``distinct 
part'' also includes a composite distinct part that meets the additional 
requirements of paragraph (c) of this section.
    (2) Requirements. In addition to meeting the participation 
requirements for long-term care facilities set forth elsewhere in this 
subpart, a distinct part SNF or NF must meet all of the following 
requirements:
    (i) The SNF or NF must be operated under common ownership and 
control (that is, common governance) by the institution of which it is a 
distinct part, as evidenced by the following:
    (A) The SNF or NF is wholly owned by the institution of which it is 
a distinct part.
    (B) The SNF or NF is subject to the by-laws and operating decisions 
of a common governing body.
    (C) The institution of which the SNF or NF is a distinct part has 
final responsibility for the distinct part's administrative decisions 
and personnel policies, and final approval for the distinct part's 
personnel actions.
    (D) The SNF or NF functions as an integral and subordinate part of 
the institution of which it is a distinct part, with significant common 
resource

[[Page 43]]

usage of buildings, equipment, personnel, and services.
    (ii) The administrator of the SNF or NF reports to and is directly 
accountable to the management of the institution of which the SNF or NF 
is a distinct part.
    (iii) The SNF or NF must have a designated medical director who is 
responsible for implementing care policies and coordinating medical 
care, and who is directly accountable to the management of the 
institution of which it is a distinct part.
    (iv) The SNF or NF is financially integrated with the institution of 
which it is a distinct part, as evidenced by the sharing of income and 
expenses with that institution, and the reporting of its costs on that 
institution's cost report.
    (v) A single institution can have a maximum of only one distinct 
part SNF and one distinct part NF.
    (vi) (A) An institution cannot designate a distinct part SNF or NF, 
but instead must submit a written request with documentation that 
demonstrates it meets the criteria set forth above to CMS to determine 
if it may be considered a distinct part.
    (B) The effective date of approval of a distinct part is the date 
that CMS determines all requirements (including enrollment with the 
fiscal intermediary (FI)) are met for approval, and cannot be made 
retroactive.
    (C) The institution must request approval from CMS for all proposed 
changes in the number of beds in the approved distinct part.
    (c) Composite distinct part--(1) Definition. A composite distinct 
part is a distinct part consisting of two or more noncontiguous 
components that are not located within the same campus, as defined in 
Sec.  413.65(a)(2) of this chapter.
    (2) Requirements. In addition to meeting the requirements of 
paragraph (b) of this section, a composite distinct part must meet all 
of the following requirements:
    (i) A SNF or NF that is a composite of more than one location will 
be treated as a single distinct part of the institution of which it is a 
distinct part. As such, the composite distinct part will have only one 
provider agreement and only one provider number.
    (ii) If two or more institutions (each with a distinct part SNF or 
NF) undergo a change of ownership, CMS must approve the existing SNFs or 
NFs as meeting the requirements before they are considered a composite 
distinct part of a single institution. In making such a determination, 
CMS considers whether its approval or disapproval of a composite 
distinct part promotes the effective and efficient use of public monies 
without sacrificing the quality of care.
    (iii) If there is a change of ownership of a composite distinct part 
SNF or NF, the assignment of the provider agreement to the new owner 
will apply to all of the approved locations that comprise the composite 
distinct part SNF or NF.
    (iv) To ensure quality of care and quality of life for all 
residents, the various components of a composite distinct part must meet 
all of the requirements for participation independently in each 
location.
    (d) Common area. Common areas are dining rooms, activity rooms, 
meeting rooms where residents are located on a regular basis, and other 
areas in the facility where residents may gather together with other 
residents, visitors, and staff.
    (e) Fully sprinklered. A fully sprinklered long term care facility 
is one that has all areas sprinklered in accordance with National Fire 
Protection Association 13 ``Standard for the Installation of Sprinkler 
Systems'' without the use of waivers or the Fire Safety Evaluation 
System.

[68 FR 46071, Aug. 4, 2003, as amended at 71 FR 39229, July 12, 2006; 71 
FR 55340, Sept. 22, 2006]



Sec.  483.10  Resident rights.

    The resident has a right to a dignified existence, self-
determination, and communication with and access to persons and services 
inside and outside the facility. A facility must protect and promote the 
rights of each resident, including each of the following rights:
    (a) Exercise of rights. (1) The resident has the right to exercise 
his or her rights as a resident of the facility and as a citizen or 
resident of the United States.

[[Page 44]]

    (2) The resident has the right to be free of interference, coercion, 
discrimination, and reprisal from the facility in exercising his or her 
rights.
    (3) In the case of a resident adjudged incompetent under the laws of 
a State by a court of competent jurisdiction, the rights of the resident 
are exercised by the person appointed under State law to act on the 
resident's behalf.
    (4) In the case of a resident who has not been adjudged incompetent 
by the State court, any legal-surrogate designated in accordance with 
State law may exercise the resident's rights to the extent provided by 
State law.
    (b) Notice of rights and services. (1) The facility must inform the 
resident both orally and in writing in a language that the resident 
understands of his or her rights and all rules and regulations governing 
resident conduct and responsibilities during the stay in the facility. 
The facility must also provide the resident with the notice (if any) of 
the State developed under section 1919(e)(6) of the Act. Such 
notification must be made prior to or upon admission and during the 
resident's stay. Receipt of such information, and any amendments to it, 
must be acknowledged in writing;
    (2) The resident or his or her legal representative has the right--
    (i) Upon an oral or written request, to access all records 
pertaining to himself or herself including current clinical records 
within 24 hours (excluding weekends and holidays); and
    (ii) After receipt of his or her records for inspection, to purchase 
at a cost not to exceed the community standard photocopies of the 
records or any portions of them upon request and 2 working days advance 
notice to the facility.
    (3) The resident has the right to be fully informed in language that 
he or she can understand of his or her total health status, including 
but not limited to, his or her medical condition;
    (4) The resident has the right to refuse treatment, to refuse to 
participate in experimental research, and to formulate an advance 
directive as specified in paragraph (8) of this section; and
    (5) The facility must--
    (i) Inform each resident who is entitled to Medicaid benefits, in 
writing, at the time of admission to the nursing facility or, when the 
resident becomes eligible for Medicaid of--
    (A) The items and services that are included in nursing facility 
services under the State plan and for which the resident may not be 
charged;
    (B) Those other items and services that the facility offers and for 
which the resident may be charged, and the amount of charges for those 
services; and
    (ii) Inform each resident when changes are made to the items and 
services specified in paragraphs (5)(i) (A) and (B) of this section.
    (6) The facility must inform each resident before, or at the time of 
admission, and periodically during the resident's stay, of services 
available in the facility and of charges for those services, including 
any charges for services not covered under Medicare or by the facility's 
per diem rate.
    (7) The facility must furnish a written description of legal rights 
which includes--
    (i) A description of the manner of protecting personal funds, under 
paragraph (c) of this section;
    (ii) A description of the requirements and procedures for 
establishing eligibility for Medicaid, including the right to request an 
assessment under section 1924(c) which determines the extent of a 
couple's non-exempt resources at the time of institutionalization and 
attributes to the community spouse an equitable share of resources which 
cannot be considered available for payment toward the cost of the 
institutionalized spouse's medical care in his or her process of 
spending down to Medicaid eligibility levels;
    (iii) A posting of names, addresses, and telephone numbers of all 
pertinent State client advocacy groups such as the State survey and 
certification agency, the State licensure office, the State ombudsman 
program, the protection and advocacy network, and the Medicaid fraud 
control unit; and
    (iv) A statement that the resident may file a complaint with the 
State survey and certification agency concerning resident abuse, 
neglect, misappropriation of resident property in the facility, and non-
compliance with the advance directives requirements.

[[Page 45]]

    (8) The facility must comply with the requirements specified in 
subpart I of part 489 of this chapter relating to maintaining written 
policies and procedures regarding advance directives. These requirements 
include provisions to inform and provide written information to all 
adult residents concerning the right to accept or refuse medical or 
surgical treatment and, at the individual's option, formulate an advance 
directive. This includes a written description of the facility's 
policies to implement advance directives and applicable State law. 
Facilities are permitted to contract with other entities to furnish this 
information but are still legally responsible for ensuring that the 
requirements of this section are met. If an adult individual is 
incapacitated at the time of admission and is unable to receive 
information (due to the incapacitating condition or a mental disorder) 
or articulate whether or not he or she has executed an advance 
directive, the facility may give advance directive information to the 
individual's family or surrogate in the same manner that it issues other 
materials about policies and procedures to the family of the 
incapacitated individual or to a surrogate or other concerned persons in 
accordance with State law. The facility is not relieved of its 
obligation to provide this information to the individual once he or she 
is no longer incapacitated or unable to receive such information. 
Follow-up procedures must be in place to provide the information to the 
individual directly at the appropriate time.
    (9) The facility must inform each resident of the name, specialty, 
and way of contacting the physician responsible for his or her care.
    (10) The facility must prominently display in the facility written 
information, and provide to residents and applicants for admission oral 
and written information about how to apply for and use Medicare and 
Medicaid benefits, and how to receive refunds for previous payments 
covered by such benefits.
    (11) Notification of changes. (i) A facility must immediately inform 
the resident; consult with the resident's physician; and if known, 
notify the resident's legal respresentative or an interested family 
member when there is--
    (A) An accident involving the resident which results in injury and 
has the potential for requiring physician intervention;
    (B) A significant change in the resident's physical, mental, or 
psychosocial status (i.e., a deterioration in health, mental, or 
psychosocial status in either life-threatening conditions or clinical 
complications);
    (C) A need to alter treatment significantly (i.e., a need to 
discontinue an existing form of treatment due to adverse consequences, 
or to commence a new form of treatment); or
    (D) A decision to transfer or discharge the resident from the 
facility as specified in Sec.  483.12(a).
    (ii) The facility must also promptly notify the resident and, if 
known, the resident's legal representative or interested family member 
when there is--
    (A) A change in room or roommate assignment as specified in Sec.  
483.15(e)(2); or
    (B) A change in resident rights under Federal or State law or 
regulations as specified in paragraph (b)(1) of this section.
    (iii) The facility must record and periodically update the address 
and phone number of the resident's legal representative or interested 
family member.
    (12) Admission to a composite distinct part. A facility that is a 
composite distinct part (as defined in Sec.  483.5(c) of this subpart) 
must disclose in its admission agreement its physical configuration, 
including the various locations that comprise the composite distinct 
part, and must specify the policies that apply to room changes between 
its different locations under Sec.  483.12(a)(8).
    (c) Protection of resident funds. (1) The resident has the right to 
manage his or her financial affairs, and the facility may not require 
residents to deposit their personal funds with the facility.
    (2) Management of personal funds. Upon written authorization of a 
resident, the facility must hold, safeguard, manage, and account for the 
personal funds of the resident deposited with the facility, as specified 
in paragraphs (c)(3)-(8) of this section.
    (3) Deposit of funds. (i) Funds in excess of $50. The facility must 
deposit any residents' personal funds in excess of

[[Page 46]]

$50 in an interest bearing account (or accounts) that is separate from 
any of the facility's operating accounts, and that credits all interest 
earned on resident's funds to that account. (In pooled accounts, there 
must be a separate accounting for each resident's share.)
    (ii) Funds less than $50. The facility must maintain a resident's 
personal funds that do not exceed $50 in a non-interest bearing account, 
interest-bearing account, or petty cash fund.
    (4) Accounting and records. The facility must establish and maintain 
a system that assures a full and complete and separate accounting, 
according to generally accepted accounting principles, of each 
resident's personal funds entrusted to the facility on the resident's 
behalf.
    (i) The system must preclude any commingling of resident funds with 
facility funds or with the funds of any person other than another 
resident.
    (ii) The individual financial record must be available through 
quarterly statements and on request to the resident or his or her legal 
representative.
    (5) Notice of certain balances. The facility must notify each 
resident that receives Medicaid benefits--
    (i) When the amount in the resident's account reaches $200 less than 
the SSI resource limit for one person, specified in section 
1611(a)(3)(B) of the Act; and
    (ii) That, if the amount in the account, in addition to the value of 
the resident's other nonexempt resources, reaches the SSI resource limit 
for one person, the resident may lose eligibility for Medicaid or SSI.
    (6) Conveyance upon death. Upon the death of a resident with a 
personal fund deposited with the facility, the facility must convey 
within 30 days the resident's funds, and a final accounting of those 
funds, to the individual or probate jurisdiction administering the 
resident's estate.
    (7) Assurance of financial security. The facility must purchase a 
surety bond, or otherwise provide assurance satisfactory to the 
Secretary, to assure the security of all personal funds of residents 
deposited with the facility.
    (8) Limitation on charges to personal funds. The facility may not 
impose a charge against the personal funds of a resident for any item or 
service for which payment is made under Medicaid or Medicare (except for 
applicable deductible and coinsurance amounts). The facility may charge 
the resident for requested services that are more expensive than or in 
excess of covered services in accordance with Sec.  489.32 of this 
chapter. (This does not affect the prohibition on facility charges for 
items and services for which Medicaid has paid. See Sec.  447.15, which 
limits participation in the Medicaid program to providers who accept, as 
payment in full, Medicaid payment plus any deductible, coinsurance, or 
copayment required by the plan to be paid by the individual.)
    (i) Services included in Medicare or Medicaid payment. During the 
course of a covered Medicare or Medicaid stay, facilities may not charge 
a resident for the following categories of items and services:
    (A) Nursing services as required at Sec.  483.30 of this subpart.
    (B) Dietary services as required at Sec.  483.35 of this subpart.
    (C) An activities program as required at Sec.  483.15(f) of this 
subpart.
    (D) Room/bed maintenance services.
    (E) Routine personal hygiene items and services as required to meet 
the needs of residents, including, but not limited to, hair hygiene 
supplies, comb, brush, bath soap, disinfecting soaps or specialized 
cleansing agents when indicated to treat special skin problems or to 
fight infection, razor, shaving cream, toothbrush, toothpaste, denture 
adhesive, denture cleaner, dental floss, moisturizing lotion, tissues, 
cotton balls, cotton swabs, deodorant, incontinence care and supplies, 
sanitary napkins and related supplies, towels, washcloths, hospital 
gowns, over the counter drugs, hair and nail hygiene services, bathing, 
and basic personal laundry.
    (F) Medically-related social services as required at Sec.  483.15(g) 
of this subpart.
    (ii) Items and services that may be charged to residents' funds. 
Listed below are general categories and examples of items and services 
that the facility may charge to residents' funds if they are requested 
by a resident, if the facility informs the resident that there will be a 
charge, and if payment is not made by Medicare or Medicaid:

[[Page 47]]

    (A) Telephone.
    (B) Television/radio for personal use.
    (C) Personal comfort items, including smoking materials, notions and 
novelties, and confections.
    (D) Cosmetic and grooming items and services in excess of those for 
which payment is made under Medicaid or Medicare.
    (E) Personal clothing.
    (F) Personal reading matter.
    (G) Gifts purchased on behalf of a resident.
    (H) Flowers and plants.
    (I) Social events and entertainment offered outside the scope of the 
activities program, provided under Sec.  483.15(f) of this subpart.
    (J) Noncovered special care services such as privately hired nurses 
or aides.
    (K) Private room, except when therapeutically required (for example, 
isolation for infection control).
    (L) Specially prepared or alternative food requested instead of the 
food generally prepared by the facility, as required by Sec.  483.35 of 
this subpart.
    (iii) Requests for items and services. (A) The facility must not 
charge a resident (or his or her representative) for any item or service 
not requested by the resident.
    (B) The facility must not require a resident (or his or her 
representative) to request any item or service as a condition of 
admission or continued stay.
    (C) The facility must inform the resident (or his or her 
representative) requesting an item or service for which a charge will be 
made that there will be a charge for the item or service and what the 
charge will be.
    (d) Free choice. The resident has the right to--
    (1) Choose a personal attending physician;
    (2) Be fully informed in advance about care and treatment and of any 
changes in that care or treatment that may affect the resident's well-
being; and
    (3) Unless adjudged incompetent or otherwise found to be 
incapacitated under the laws of the State, participate in planning care 
and treatment or changes in care and treatment.
    (e) Privacy and confidentiality. The resident has the right to 
personal privacy and confidentiality of his or her personal and clinical 
records.
    (1) Personal privacy includes accommodations, medical treatment, 
written and telephone communications, personal care, visits, and 
meetings of family and resident groups, but this does not require the 
facility to provide a private room for each resident;
    (2) Except as provided in paragraph (e)(3) of this section, the 
resident may approve or refuse the release of personal and clinical 
records to any individual outside the facility;
    (3) The resident's right to refuse release of personal and clinical 
records does not apply when--
    (i) The resident is transferred to another health care institution; 
or
    (ii) Record release is required by law.
    (f) Grievances. A resident has the right to--
    (1) Voice grievances without discrimination or reprisal. Such 
grievances include those with respect to treatment which has been 
furnished as well as that which has not been furnished; and
    (2) Prompt efforts by the facility to resolve grievances the 
resident may have, including those with respect to the behavior of other 
residents.
    (g) Examination of survey results. A resident has the right to--
    (1) Examine the results of the most recent survey of the facility 
conducted by Federal or State surveyors and any plan of correction in 
effect with respect to the facility. The facility must make the results 
available for examination in a place readily accessible to residents, 
and must post a notice of their availability; and
    (2) Receive information from agencies acting as client advocates, 
and be afforded the opportunity to contact these agencies.
    (h) Work. The resident has the right to--
    (1) Refuse to perform services for the facility;
    (2) Perform services for the facility, if he or she chooses, when--
    (i) The facility has documented the need or desire for work in the 
plan of care;
    (ii) The plan specifies the nature of the services performed and 
whether the services are voluntary or paid;

[[Page 48]]

    (iii) Compensation for paid services is at or above prevailing 
rates; and
    (iv) The resident agrees to the work arrangement described in the 
plan of care.
    (i) Mail. The resident has the right to privacy in written 
communications, including the right to--
    (1) Send and promptly receive mail that is unopened; and
    (2) Have access to stationery, postage, and writing implements at 
the resident's own expense.
    (j) Access and visitation rights. (1) The resident has the right and 
the facility must provide immediate access to any resident by the 
following:
    (i) Any representative of the Secretary;
    (ii) Any representative of the State:
    (iii) The resident's individual physician;
    (iv) The State long term care ombudsman (established under section 
307(a)(12) of the Older Americans Act of 1965);
    (v) The agency responsible for the protection and advocacy system 
for developmentally disabled individuals (established under part C of 
the Developmental Disabilities Assistance and Bill of Rights Act);
    (vi) The agency responsible for the protection and advocacy system 
for mentally ill individuals (established under the Protection and 
Advocacy for Mentally Ill Individuals Act);
    (vii) Subject to the resident's right to deny or withdraw consent at 
any time, immediate family or other relatives of the resident; and
    (viii) Subject to reasonable restrictions and the resident's right 
to deny or withdraw consent at any time, others who are visiting with 
the consent of the resident.
    (2) The facility must provide reasonable access to any resident by 
any entity or individual that provides health, social, legal, or other 
services to the resident, subject to the resident's right to deny or 
withdraw consent at any time.
    (3) The facility must allow representatives of the State Ombudsman, 
described in paragraph (j)(1)(iv) of this section, to examine a 
resident's clinical records with the permission of the resident or the 
resident's legal representative, and consistent with State law.
    (k) Telephone. The resident has the right to have reasonable access 
to the use of a telephone where calls can be made without being 
overheard.
    (l) Personal property. The resident has the right to retain and use 
personal possessions, including some furnishings, and appropriate 
clothing, as space permits, unless to do so would infringe upon the 
rights or health and safety of other residents.
    (m) Married couples. The resident has the right to share a room with 
his or her spouse when married residents live in the same facility and 
both spouses consent to the arrangement.
    (n) Self-Administration of Drugs. An individual resident may self-
administer drugs if the interdisciplinary team, as defined by Sec.  
483.20(d)(2)(ii), has determined that this practice is safe.
    (o) Refusal of certain transfers. (1) An individual has the right to 
refuse a transfer to another room within the institution, if the purpose 
of the transfer is to relocate--
    (i) A resident of a SNF from the distinct part of the institution 
that is a SNF to a part of the institution that is not a SNF, or
    (ii) A resident of a NF from the distinct part of the institution 
that is a NF to a distinct part of the institution that is a SNF.
    (2) A resident's exercise of the right to refuse transfer under 
paragraph (o)(1) of this section does not affect the individual's 
eligibility or entitlement to Medicare or Medicaid benefits.

[56 FR 48867, Sept. 26, 1991, as amended at 57 FR 8202, Mar. 6, 1992; 57 
FR 43924, Sept. 23, 1992; 57 FR 53587, Nov. 12, 1992; 60 FR 33293, June 
27, 1995; 68 FR 46072, Aug. 4, 2003]



Sec.  483.12  Admission, transfer and discharge rights.

    (a) Transfer and discharge--
    (1) Definition: Transfer and discharge includes movement of a 
resident to a bed outside of the certified facility whether that bed is 
in the same physical plant or not. Transfer and discharge does not refer 
to movement of a resident to a bed within the same certified facility.
    (2) Transfer and discharge requirements. The facility must permit 
each

[[Page 49]]

resident to remain in the facility, and not transfer or discharge the 
resident from the facility unless--
    (i) The transfer or discharge is necessary for the resident's 
welfare and the resident's needs cannot be met in the facility;
    (ii) The transfer or discharge is appropriate because the resident's 
health has improved sufficiently so the resident no longer needs the 
services provided by the facility;
    (iii) The safety of individuals in the facility is endangered;
    (iv) The health of individuals in the facility would otherwise be 
endangered;
    (v) The resident has failed, after reasonable and appropriate 
notice, to pay for (or to have paid under Medicare or Medicaid) a stay 
at the facility. For a resident who becomes eligible for Medicaid after 
admission to a facility, the facility may charge a resident only 
allowable charges under Medicaid; or
    (vi) The facility ceases to operate.
    (3) Documentation. When the facility transfers or discharges a 
resident under any of the circumstances specified in paragraphs 
(a)(2)(i) through (v) of this section, the resident's clinical record 
must be documented. The documentation must be made by--
    (i) The resident's physician when transfer or discharge is necessary 
under paragraph (a)(2)(i) or paragraph (a)(2)(ii) of this section; and
    (ii) A physician when transfer or discharge is necessary under 
paragraph (a)(2)(iv) of this section.
    (4) Notice before transfer. Before a facility transfers or 
discharges a resident, the facility must--
    (i) Notify the resident and, if known, a family member or legal 
representative of the resident of the transfer or discharge and the 
reasons for the move in writing and in a language and manner they 
understand.
    (ii) Record the reasons in the resident's clinical record; and
    (iii) Include in the notice the items described in paragraph (a)(6) 
of this section.
    (5) Timing of the notice. (i) Except when specified in paragraph 
(a)(5)(ii) of this section, the notice of transfer or discharge required 
under paragraph (a)(4) of this section must be made by the facility at 
least 30 days before the resident is transferred or discharged.
    (ii) Notice may be made as soon as practicable before transfer or 
discharge when--
    (A) the safety of individuals in the facility would be endangered 
under paragraph (a)(2)(iii) of this section;
    (B) The health of individuals in the facility would be endangered, 
under paragraph (a)(2)(iv) of this section;
    (C) The resident's health improves sufficiently to allow a more 
immediate transfer or discharge, under paragraph (a)(2)(ii) of this 
section;
    (D) An immediate transfer or discharge is required by the resident's 
urgent medical needs, under paragraph (a)(2)(i) of this section; or
    (E) A resident has not resided in the facility for 30 days.
    (6) Contents of the notice. The written notice specified in 
paragraph (a)(4) of this section must include the following:
    (i) The reason for transfer or discharge;
    (ii) The effective date of transfer or discharge;
    (iii) The location to which the resident is transferred or 
discharged;
    (iv) A statement that the resident has the right to appeal the 
action to the State;
    (v) The name, address and telephone number of the State long term 
care ombudsman;
    (vi) For nursing facility residents with developmental disabilities, 
the mailing address and telephone number of the agency responsible for 
the protection and advocacy of developmentally disabled individuals 
established under Part C of the Developmental Disabilities Assistance 
and Bill of Rights Act; and
    (vii) For nursing facility residents who are mentally ill, the 
mailing address and telephone number of the agency responsible for the 
protection and advocacy of mentally ill individuals established under 
the Protection and Advocacy for Mentally Ill Individuals Act.
    (7) Orientation for transfer or discharge. A facility must provide 
sufficient preparation and orientation to residents to ensure safe and 
orderly transfer or discharge from the facility.

[[Page 50]]

    (8) Room changes in a composite distinct part. Room changes in a 
facility that is a composite distinct part (as defined in Sec.  
483.5(c)) must be limited to moves within the particular building in 
which the resident resides, unless the resident voluntarily agrees to 
move to another of the composite distinct part's locations.
    (b) Notice of bed-hold policy and readmission--(1) Notice before 
transfer. Before a nursing facility transfers a resident to a hospital 
or allows a resident to go on therapeutic leave, the nursing facility 
must provide written information to the resident and a family member or 
legal representative that specifies--
    (i) The duration of the bed-hold policy under the State plan, if 
any, during which the resident is permitted to return and resume 
residence in the nursing facility; and
    (ii) The nursing facility's policies regarding bed-hold periods, 
which must be consistent with paragraph (b)(3) of this section, 
permitting a resident to return.
    (2) Bed-hold notice upon transfer. At the time of transfer of a 
resident for hospitalization or therapeutic leave, a nursing facility 
must provide to the resident and a family member or legal representative 
written notice which specifies the duration of the bed-hold policy 
described in paragraph (b)(1) of this section.
    (3) Permitting resident to return to facility. A nursing facility 
must establish and follow a written policy under which a resident, whose 
hospitalization or therapeutic leave exceeds the bed-hold period under 
the State plan, is readmitted to the facility immediately upon the first 
availability of a bed in a semi-private room if the resident--
    (i) Requires the services provided by the facility; and
    (ii) Is eligible for Medicaid nursing facility services.
    (4) Readmission to a composite distinct part. When the nursing 
facility to which a resident is readmitted is a composite distinct part 
(as defined in Sec.  483.5(c) of this subpart), the resident must be 
permitted to return to an available bed in the particular location of 
the composite distinct part in which he or she resided previously. If a 
bed is not available in that location at the time of readmission, the 
resident must be given the option to return to that location upon the 
first availability of a bed there.
    (c) Equal access to quality care. (1) A facility must establish and 
maintain identical policies and practices regarding transfer, discharge, 
and the provision of services under the State plan for all individuals 
regardless of source of payment;
    (2) The facility may charge any amount for services furnished to 
non-Medicaid residents consistent with the notice requirement in Sec.  
483.10(b)(5)(i) and (b)(6) describing the charges; and
    (3) The State is not required to offer additional services on behalf 
of a resident other than services provided in the State plan.
    (d) Admissions policy. (1) The facility must--
    (i) Not require residents or potential residents to waive their 
rights to Medicare or Medicaid; and
    (ii) Not require oral or written assurance that residents or 
potential residents are not eligible for, or will not apply for, 
Medicare or Medicaid benefits.
    (2) The facility must not require a third party guarantee of payment 
to the facility as a condition of admission or expedited admission, or 
continued stay in the facility. However, the facility may require an 
individual who has legal access to a resident's income or resources 
available to pay for facility care to sign a contract, without incurring 
personal financial liability, to provide facility payment from the 
resident's income or resources.
    (3) In the case of a person eligible for Medicaid, a nursing 
facility must not charge, solicit, accept, or receive, in addition to 
any amount otherwise required to be paid under the State plan, any gift, 
money, donation, or other consideration as a precondition of admission, 
expedited admission or continued stay in the facility. However,--
    (i) A nursing facility may charge a resident who is eligible for 
Medicaid for items and services the resident has requested and received, 
and that are not specified in the State plan as included in the term 
``nursing facility services'' so long as the facility gives proper 
notice of the availability and

[[Page 51]]

cost of these services to residents and does not condition the 
resident's admission or continued stay on the request for and receipt of 
such additional services; and
    (ii) A nursing facility may solicit, accept, or receive a 
charitable, religious, or philanthropic contribution from an 
organization or from a person unrelated to a Medicaid eligible resident 
or potential resident, but only to the extent that the contribution is 
not a condition of admission, expedited admission, or continued stay in 
the facility for a Medicaid eligible resident.
    (4) States or political subdivisions may apply stricter admissions 
standards under State or local laws than are specified in this section, 
to prohibit discrimination against individuals entitled to Medicaid.

[56 FR 48869, Sept. 26, 1991, as amended at 57 FR 43924, Sept. 23, 1992; 
68 FR 46072, Aug. 4, 2003]



Sec.  483.13  Resident behavior and facility practices.

    (a) Restraints. The resident has the right to be free from any 
physical or chemical restraints imposed for purposes of discipline or 
convenience, and not required to treat the resident's medical symptoms.
    (b) Abuse. The resident has the right to be free from verbal, 
sexual, physical, and mental abuse, corporal punishment, and involuntary 
seclusion.
    (c) Staff treatment of residents. The facility must develop and 
implement written policies and procedures that prohibit mistreatment, 
neglect, and abuse of residents and misappropriation of resident 
property.
    (1) The facility must--
    (i) Not use verbal, mental, sexual, or physical abuse, corporal 
punishment, or involuntary seclusion;
    (ii) Not employ individuals who have been--
    (A) Found guilty of abusing, neglecting, or mistreating residents by 
a court of law; or
    (B) Have had a finding entered into the State nurse aide registry 
concerning abuse, neglect, mistreatment of residents or misappropriation 
of their property; and
    (iii) Report any knowledge it has of actions by a court of law 
against an employee, which would indicate unfitness for service as a 
nurse aide or other facility staff to the State nurse aide registry or 
licensing authorities.
    (2) The facility must ensure that all alleged violations involving 
mistreatment, neglect, or abuse, including injuries of unknown source, 
and misappropriation of resident property are reported immediately to 
the administrator of the facility and to other officials in accordance 
with State law through established procedures (including to the State 
survey and certification agency).
    (3) The facility must have evidence that all alleged violations are 
thoroughly investigated, and must prevent further potential abuse while 
the investigation is in progress.
    (4) The results of all investigations must be reported to the 
administrator or his designated representative and to other officials in 
accordance with State law (including to the State survey and 
certification agency) within 5 working days of the incident, and if the 
alleged violation is verified appropriate corrective action must be 
taken.

[56 FR 48870, Sept. 26, 1991, as amended at 57 FR 43924, Sept. 23, 1992]



Sec.  483.15  Quality of life.

    A facility must care for its residents in a manner and in an 
environment that promotes maintenance or enhancement of each resident's 
quality of life.
    (a) Dignity. The facility must promote care for residents in a 
manner and in an environment that maintains or enhances each resident's 
dignity and respect in full recognition of his or her individuality.
    (b) Self-determination and participation. The resident has the right 
to--
    (1) Choose activities, schedules, and health care consistent with 
his or her interests, assessments, and plans of care;
    (2) Interact with members of the community both inside and outside 
the facility; and
    (3) Make choices about aspects of his or her life in the facility 
that are significant to the resident.
    (c) Participation in resident and family groups. (1) A resident has 
the right to

[[Page 52]]

organize and participate in resident groups in the facility;
    (2) A resident's family has the right to meet in the facility with 
the families of other residents in the facility;
    (3) The facility must provide a resident or family group, if one 
exists, with private space;
    (4) Staff or visitors may attend meetings at the group's invitation;
    (5) The facility must provide a designated staff person responsible 
for providing assistance and responding to written requests that result 
from group meetings;
    (6) When a resident or family group exists, the facility must listen 
to the views and act upon the grievances and recommendations of 
residents and families concerning proposed policy and operational 
decisions affecting resident care and life in the facility.
    (d) Participation in other activities. A resident has the right to 
participate in social, religious, and community activities that do not 
interfere with the rights of other residents in the facility.
    (e) Accommodation of needs. A resident has the right to--
    (1) Reside and receive services in the facility with reasonable 
accommodation of individual needs and preferences, except when the 
health or safety of the individual or other residents would be 
endangered; and
    (2) Receive notice before the resident's room or roommate in the 
facility is changed.
    (f) Activities. (1) The facility must provide for an ongoing program 
of activities designed to meet, in accordance with the comprehensive 
assessment, the interests and the physical, mental, and psychosocial 
well-being of each resident.
    (2) The activities program must be directed by a qualified 
professional who--
    (i) Is a qualified therapeutic recreation specialist or an 
activities professional who--
    (A) Is licensed or registered, if applicable, by the State in which 
practicing; and
    (B) Is eligible for certification as a therapeutic recreation 
specialist or as an activities professional by a recognized accrediting 
body on or after October 1, 1990; or
    (ii) Has 2 years of experience in a social or recreational program 
within the last 5 years, 1 of which was full-time in a patient 
activities program in a health care setting; or
    (iii) Is a qualified occupational therapist or occupational therapy 
assistant; or
    (iv) Has completed a training course approved by the State.
    (g) Social Services. (1) The facility must provide medically-related 
social services to attain or maintain the highest practicable physical, 
mental, and psychosocial well-being of each resident.
    (2) A facility with more than 120 beds must employ a qualified 
social worker on a full-time basis.
    (3) Qualifications of social worker. A qualified social worker is an 
individual with--
    (i) A bachelor's degree in social work or a bachelor's degree in a 
human services field including but not limited to sociology, special 
education, rehabilitation counseling, and psychology; and
    (ii) One year of supervised social work experience in a health care 
setting working directly with individuals.
    (h) Environment. The facility must provide--
    (1) A safe, clean, comfortable, and homelike environment, allowing 
the resident to use his or her personal belongings to the extent 
possible;
    (2) Housekeeping and maintenance services necessary to maintain a 
sanitary, orderly, and comfortable interior;
    (3) Clean bed and bath linens that are in good condition;
    (4) Private closet space in each resident room, as specified in 
Sec.  483.70(d)(2)(iv) of this part;
    (5) Adequate and comfortable lighting levels in all areas;
    (6) Comfortable and safe temperature levels. Facilities initially 
certified after October 1, 1990 must maintain a temperature range of 71-
81[deg]F; and
    (7) For the maintenance of comfortable sound levels.

[56 FR 48871, Sept. 26, 1991, as amended at 57 FR 43924, Sept. 23, 1992]

[[Page 53]]



Sec.  483.20  Resident assessment.

    The facility must conduct initially and periodically a 
comprehensive, accurate, standardized, reproducible assessment of each 
resident's functional capacity.
    (a) Admission orders. At the time each resident is admitted, the 
facility must have physician orders for the resident's immediate care.
    (b) Comprehensive assessments--(1) Resident assessment instrument. A 
facility must make a comprehensive assessment of a resident's needs, 
using the resident assessment instrument (RAI) specified by the State. 
The assessment must include at least the following:
    (i) Identification and demographic information.
    (ii) Customary routine.
    (iii) Cognitive patterns.
    (iv) Communication.
    (v) Vision.
    (vi) Mood and behavior patterns.
    (vii) Psychosocial well-being.
    (viii) Physical functioning and structural problems.
    (ix) Continence.
    (x) Disease diagnoses and health conditions.
    (xi) Dental and nutritional status.
    (xii) Skin condition.
    (xiii) Activity pursuit.
    (xiv) Medications.
    (xv) Special treatments and procedures.
    (xvi) Discharge potential.
    (xvii) Documentation of summary information regarding the additional 
assessment performed on the care areas triggered by the completion of 
the Minimum Data Set (MDS).
    (xviii) Documentation of participation in assessment.
    The assessment process must include direct observation and 
communication with the resident, as well as communication with licensed 
and nonlicensed direct care staff members on all shifts.
    (2) When required. Subject to the timeframes prescribed in Sec.  
413.343(b) of this chapter, a facility must conduct a comprehensive 
assessment of a resident in accordance with the timeframes specified in 
paragraphs (b)(2) (i) through (iii) of this section. The timeframes 
prescribed in Sec.  413.343(b) of this chapter do not apply to CAHs.
    (i) Within 14 calendar days after admission, excluding readmissions 
in which there is no significant change in the resident's physical or 
mental condition. (For purposes of this section, ``readmission'' means a 
return to the facility following a temporary absence for hospitalization 
or for therapeutic leave.)
    (ii) Within 14 calendar days after the facility determines, or 
should have determined, that there has been a significant change in the 
resident's physical or mental condition. (For purposes of this section, 
a ``significant change'' means a major decline or improvement in the 
resident's status that will not normally resolve itself without further 
intervention by staff or by implementing standard disease-related 
clinical interventions, that has an impact on more than one area of the 
resident's health status, and requires interdisciplinary review or 
revision of the care plan, or both.)
    (iii) Not less often than once every 12 months.
    (c) Quarterly review assessment. A facility must assess a resident 
using the quarterly review instrument specified by the State and 
approved by CMS not less frequently than once every 3 months.
    (d) Use. A facility must maintain all resident assessments completed 
within the previous 15 months in the resident's active record and use 
the results of the assessments to develop, review, and revise the 
resident's comprehensive plan f care.
    (e) Coordination. A facility must coordinate assessments with the 
preadmission screening and resident review program under Medicaid in 
part 483, subpart C to the maximum extent practicable to avoid 
duplicative testing and effort.
    (f) Automated data processing requirement--(1) Encoding data. Within 
7 days after a facility completes a resident's assessment, a facility 
must encode the following information for each resident in the facility:
    (i) Admission assessment.
    (ii) Annual assessment updates.
    (iii) Significant change in status assessments.
    (iv) Quarterly review assessments.

[[Page 54]]

    (v) A subset of items upon a resident's transfer, reentry, 
discharge, and death.
    (vi) Background (face-sheet) information, if there is no admission 
assessment.
    (2) Transmitting data. Within 7 days after a facility completes a 
resident's assessment, a facility must be capable of transmitting to the 
CMS System information for each resident contained in the MDS in a 
format that conforms to standard record layouts and data dictionaries, 
and that passes standardized edits defined by CMS and the State.
    (3) Transmittal requirements. Within 14 days after a facility 
completes a resident's assessment, a facility must electronically 
transmit encoded, accurate, and complete MDS data to the CMS System, 
including the following:
    (i) Admission assessment.
    (ii) Annual assessment.
    (iii) Significant change in status assessment.
    (iv) Significant correction of prior full assessment.
    (v) Significant correction of prior quarterly assessment.
    (vi) Quarterly review.
    (vii) A subset of items upon a resident's transfer, reentry, 
discharge, and death.
    (viii) Background (face-sheet) information, for an initial 
transmission of MDS data on a resident that does not have an admission 
assessment.
    (4) Data format. The facility must transmit data in the format 
specified by CMS or, for a State which has an alternate RAI approved by 
CMS, in the format specified by the State and approved by CMS.
    (5) Resident-identifiable information. (i) A facility may not 
release information that is resident-identifiable to the public.
    (ii) The facility may release information that is resident-
identifiable to an agent only in accordance with a contract under which 
the agent agrees not to use or disclose the information except to the 
extent the facility itself is permitted to do so.
    (g) Accuracy of assessments. The assessment must accurately reflect 
the resident's status.
    (h) Coordination. A registered nurse must conduct or coordinate each 
assessment with the appropriate participation of health professionals.
    (i) Certification. (1) A registered nurse must sign and certify that 
the assessment is completed.
    (2) Each individual who completes a portion of the assessment must 
sign and certify the accuracy of that portion of the assessment.
    (j) Penalty for falsification. (1) Under Medicare and Medicaid, an 
individual who willfully and knowingly--
    (i) Certifies a material and false statement in a resident 
assessment is subject to a civil money penalty of not more than $1,000 
for each assessment; or
    (ii) Causes another individual to certify a material and false 
statement in a resident assessment is subject to a civil money penalty 
of not more than $5,000 for each assessment.
    (2) Clinical disagreement does not constitute a material and false 
statement.
    (k) Comprehensive care plans. (1) The facility must develop a 
comprehensive care plan for each resident that includes measurable 
objectives and timetables to meet a resident's medical, nursing, and 
mental and psychosocial needs that are identified in the comprehensive 
assessment. The care plan must describe the following--
    (i) The services that are to be furnished to attain or maintain the 
resident's highest practicable physical, mental, and psychosocial well-
being as required under Sec.  483.25; and
    (ii) Any services that would otherwise be required under Sec.  
483.25 but are not provided due to the resident's exercise of rights 
under Sec.  483.10, including the right to refuse treatment under Sec.  
483.10(b)(4).
    (2) A comprehensive care plan must be--
    (i) Developed within 7 days after completion of the comprehensive 
assessment;
    (ii) Prepared by an interdisciplinary team, that includes the 
attending physician, a registered nurse with responsibility for the 
resident, and other appropriate staff in disciplines as determined by 
the resident's needs, and, to

[[Page 55]]

the extent practicable, the participation of the resident, the 
resident's family or the resident's legal representative; and
    (iii) Periodically reviewed and revised by a team of qualified 
persons after each assessment.
    (3) The services provided or arranged by the facility must--
    (i) Meet professional standards of quality; and
    (ii) Be provided by qualified persons in accordance with each 
resident's written plan of care.
    (l) Discharge summary. When the facility anticipates discharge a 
resident must have a discharge summary that includes--
    (1) A recapitulation of the resident's stay;
    (2) A final summary of the resident's status to include items in 
paragraph (b)(2) of this section, at the time of the discharge that is 
available for release to authorized persons and agencies, with the 
consent of the resident or legal representative; and
    (3) A post-discharge plan of care that is developed with the 
participation of the resident and his or her family, which will assist 
the resident to adjust to his or her new living environment.
    (m) Preadmission screening for mentally ill individuals and 
individuals with mental retardation. (1) A nursing facility must not 
admit, on or after January 1, 1989, any new resident with--
    (i) Mental illness as defined in paragraph (f)(2)(i) of this 
section, unless the State mental health authority has determined, based 
on an independent physical and mental evaluation performed by a person 
or entity other than the State mental health authority, prior to 
admission,
    (A) That, because of the physical and mental condition of the 
individual, the individual requires the level of services provided by a 
nursing facility; and
    (B) If the individual requires such level of services, whether the 
individual requires specialized services; or
    (ii) Mental retardation, as defined in paragraph (f)(2)(ii) of this 
section, unless the State mental retardation or developmental disability 
authority has determined prior to admission--
    (A) That, because of the physical and mental condition of the 
individual, the individual requires the level of services provided by a 
nursing facility; and
    (B) If the individual requires such level of services, whether the 
individual requires specialized services for mental retardation.
    (2) Definition. For purposes of this section--
    (i) An individual is considered to have mental illness if the 
individual has a serious mental illness as defined in Sec.  
483.102(b)(1).
    (ii) An individual is considered to be mentally retarded if the 
individual is mentally retarded as defined in Sec.  483.102(b)(3) or is 
a person with a related condition as described in 42 CFR 435.1010 of 
this chapter.

[56 FR 48871, Sept. 26, 1991, as amended at 57 FR 43924, Sept. 23, 1992; 
62 FR 67211, Dec. 23, 1997; 63 FR 53307, Oct. 5, 1998; 64 FR 41543, July 
30, 1999; 68 FR 46072, Aug. 4, 2003; 71 FR 39229, July 12, 2006; 74 FR 
40363, Aug.11, 2009]



Sec.  483.25  Quality of care.

    Each resident must receive and the facility must provide the 
necessary care and services to attain or maintain the highest 
practicable physical, mental, and psychosocial well-being, in accordance 
with the comprehensive assessment and plan of care.
    (a) Activities of daily living. Based on the comprehensive 
assessment of a resident, the facility must ensure that--
    (1) A resident's abilities in activities of daily living do not 
diminish unless circumstances of the individual's clinical condition 
demonstrate that diminution was unavoidable. This includes the 
resident's ability to--
    (i) Bathe, dress, and groom;
    (ii) Transfer and ambulate;
    (iii) Toilet;
    (iv) Eat; and
    (v) Use speech, language, or other functional communication systems.
    (2) A resident is given the appropriate treatment and services to 
maintain or improve his or her abilities specified in paragraph (a)(1) 
of this section; and
    (3) A resident who is unable to carry out activities of daily living 
receives the necessary services to maintain good nutrition, grooming, 
and personal and oral hygiene.

[[Page 56]]

    (b) Vision and hearing. To ensure that residents receive proper 
treatment and assistive devices to maintain vision and hearing 
abilities, the facility must, if necessary, assist the resident--
    (1) In making appointments, and
    (2) By arranging for transportation to and from the office of a 
practitioner specializing in the treatment of vision or hearing 
impairment or the office of a professional specializing in the provision 
of vision or hearing assistive devices.
    (c) Pressure sores. Based on the comprehensive assessment of a 
resident, the facility must ensure that--
    (1) A resident who enters the facility without pressure sores does 
not develop pressure sores unless the individual's clinical condition 
demonstrates that they were unavoidable; and
    (2) A resident having pressure sores receives necessary treatment 
and services to promote healing, prevent infection and prevent new sores 
from developing.
    (d) Urinary Incontinence. Based on the resident's comprehensive 
assessment, the facility must ensure that--
    (1) A resident who enters the facility without an indwelling 
catheter is not catheterized unless the resident's clinical condition 
demonstrates that catheterization was necessary; and
    (2) A resident who is incontinent of bladder receives appropriate 
treatment and services to prevent urinary tract infections and to 
restore as much normal bladder function as possible.
    (e) Range of motion. Based on the comprehensive assessment of a 
resident, the facility must ensure that--
    (1) A resident who enters the facility without a limited range of 
motion does not experience reduction in range of motion unless the 
resident's clinical condition demonstrates that a reduction in range of 
motion is unavoidable; and
    (2) A resident with a limited range of motion receives appropriate 
treatment and services to increase range of motion and/or to prevent 
further decrease in range of motion.
    (f) Mental and Psychosocial functioning. Based on the comprehensive 
assessment of a resident, the facility must ensure that--
    (1) A resident who displays mental or psychosocial adjustment 
difficulty, receives appropriate treatment and services to correct the 
assessed problem, and
    (2) A resident whose assessment did not reveal a mental or 
psychosocial adjustment difficulty does not display a pattern of 
decreased social interaction and/or increased withdrawn, angry, or 
depressive behaviors, unless the resident's clinical condition 
demonstrates that such a pattern was unavoidable.
    (g) Naso-gastric tubes. Based on the comprehensive assessment of a 
resident, the facility must ensure that--
    (1) A resident who has been able to eat enough alone or with 
assistance is not fed by naso-gastric tube unless the resident's 
clinical condition demonstrates that use of a naso-gastric tube was 
unavoidable; and
    (2) A resident who is fed by a naso-gastric or gastrostomy tube 
receives the appropriate treatment and services to prevent aspiration 
pneumonia, diarrhea, vomiting, dehydration, metabolic abnormalities, and 
nasal-pharyngeal ulcers and to restore, if possible, normal eating 
skills.
    (h) Accidents. The facility must ensure that--
    (1) The resident environment remains as free of accident hazards as 
is possible; and
    (2) Each resident receives adequate supervision and assistance 
devices to prevent accidents.
    (i) Nutrition. Based on a resident's comprehensive assessment, the 
facility must ensure that a resident--
    (1) Maintains acceptable parameters of nutritional status, such as 
body weight and protein levels, unless the resident's clinical condition 
demonstrates that this is not possible; and
    (2) Receives a therapeutic diet when there is a nutritional problem.
    (j) Hydration. The facility must provide each resident with 
sufficient fluid intake to maintain proper hydration and health.
    (k) Special needs. The facility must ensure that residents receive 
proper treatment and care for the following special services:
    (1) Injections;
    (2) Parenteral and enteral fluids;

[[Page 57]]

    (3) Colostomy, ureterostomy, or ileostomy care;
    (4) Tracheostomy care;
    (5) Tracheal suctioning;
    (6) Respiratory care;
    (7) Foot care; and
    (8) Prostheses.
    (l) Unnecessary drugs--(1) General. Each resident's drug regimen 
must be free from unnecessary drugs. An unnecessary drug is any drug 
when used:
    (i) In excessive dose (including duplicate drug therapy); or
    (ii) For excessive duration; or
    (iii) Without adequate monitoring; or
    (iv) Without adequate indications for its use; or
    (v) In the presence of adverse consequences which indicate the dose 
should be reduced or discontinued; or
    (vi) Any combinations of the reasons above.
    (2) Antipsychotic Drugs. Based on a comprehensive assessment of a 
resident, the facility must ensure that--
    (i) Residents who have not used antipsychotic drugs are not given 
these drugs unless antipsychotic drug therapy is necessary to treat a 
specific condition as diagnosed and documented in the clinical record; 
and
    (ii) Residents who use antipsychotic drugs receive gradual dose 
reductions, and behavioral interventions, unless clinically 
contraindicated, in an effort to discontinue these drugs.
    (m) Medication Errors. The facility must ensure that--
    (1) It is free of medication error rates of five percent or greater; 
and
    (2) Residents are free of any significant medication errors.
    (n) Influenza and pneumococcal immunizations--(1) Influenza. The 
facility must develop policies and procedures that ensure that--
    (i) Before offering the influenza immunization, each resident or the 
resident's legal representative receives education regarding the 
benefits and potential side effects of the immunization;
    (ii) Each resident is offered an influenza immunization October 1 
through March 31 annually, unless the immunization is medically 
contraindicated or the resident has already been immunized during this 
time period;
    (iii) The resident or the resident's legal representative has the 
opportunity to refuse immunization; and
    (iv) The resident's medical record includes documentation that 
indicates, at a minimum, the following:
    (A) That the resident or resident's legal representative was 
provided education regarding the benefits and potential side effects of 
influenza immunization; and
    (B) That the resident either received the influenza immunization or 
did not receive the influenza immunization due to medical 
contraindications or refusal.
    (2) Pneumococcal disease. The facility must develop policies and 
procedures that ensure that--
    (i) Before offering the pneumococcal immunization, each resident or 
the resident's legal representative receives education regarding the 
benefits and potential side effects of the immunization;
    (ii) Each resident is offered a pneumococcal immunization, unless 
the immunization is medically contraindicated or the resident has 
already been immunized;
    (iii) The resident or the resident's legal representative has the 
opportunity to refuse immunization; and
    (iv) The resident's medical record includes documentation that 
indicates, at a minimum, the following:
    (A) That the resident or resident's legal representative was 
provided education regarding the benefits and potential side effects of 
pneumococcal immunization; and
    (B) That the resident either received the pneumococcal immunization 
or did not receive the pneumococcal immunization due to medical 
contraindication or refusal.
    (v) Exception. As an alternative, based on an assessment and 
practitioner recommendation, a second pneumococcal immunization may be 
given after 5 years following the first pneumococcal immunization, 
unless medically contraindicated or the resident or the resident's legal 
representative refuses the second immunization.

[56 FR 48873, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992; 
70 FR 58851, Oct. 7, 2005]

[[Page 58]]



Sec.  483.30  Nursing services.

    The facility must have sufficient nursing staff to provide nursing 
and related services to attain or maintain the highest practicable 
physical, mental, and psychosocial well-being of each resident, as 
determined by resident assessments and individual plans of care.
    (a) Sufficient staff. (1) The facility must provide services by 
sufficient numbers of each of the following types of personnel on a 24-
hour basis to provide nursing care to all residents in accordance with 
resident care plans:
    (i) Except when waived under paragraph (c) of this section, licensed 
nurses; and
    (ii) Other nursing personnel.
    (2) Except when waived under paragraph (c) of this section, the 
facility must designate a licensed nurse to serve as a charge nurse on 
each tour of duty.
    (b) Registered nurse. (1) Except when waived under paragraph (c) or 
(d) of this section, the facility must use the services of a registered 
nurse for at least 8 consecutive hours a day, 7 days a week.
    (2) Except when waived under paragraph (c) or (d) of this section, 
the facility must designate a registered nurse to serve as the director 
of nursing on a full time basis.
    (3) The director of nursing may serve as a charge nurse only when 
the facility has an average daily occupancy of 60 or fewer residents.
    (c) Nursing facilities: Waiver of requirement to provide licensed 
nurses on a 24-hour basis. To the extent that a facility is unable to 
meet the requirements of paragraphs (a)(2) and (b)(1) of this section, a 
State may waive such requirements with respect to the facility if--
    (1) The facility demonstrates to the satisfaction of the State that 
the facility has been unable, despite diligent efforts (including 
offering wages at the community prevailing rate for nursing facilities), 
to recruit appropriate personnel;
    (2) The State determines that a waiver of the requirement will not 
endanger the health or safety of individuals staying in the facility;
    (3) The State finds that, for any periods in which licensed nursing 
services are not available, a registered nurse or a physician is 
obligated to respond immediately to telephone calls from the facility;
    (4) A waiver granted under the conditions listed in paragraph (c) of 
this section is subject to annual State review;
    (5) In granting or renewing a waiver, a facility may be required by 
the State to use other qualified, licensed personnel;
    (6) The State agency granting a waiver of such requirements provides 
notice of the waiver to the State long term care ombudsman (established 
under section 307(a)(12) of the Older Americans Act of 1965) and the 
protection and advocacy system in the State for the mentally ill and 
mentally retarded; and
    (7) The nursing facility that is granted such a waiver by a State 
notifies residents of the facility (or, where appropriate, the guardians 
or legal representatives of such residents) and members of their 
immediate families of the waiver.
    (d) SNFs: Waiver of the requirement to provide services of a 
registered nurse for more than 40 hours a week. (1) The Secretary may 
waive the requirement that a SNF provide the services of a registered 
nurse for more than 40 hours a week, including a director of nursing 
specified in paragraph (b) of this section, if the Secretary finds 
that--
    (i) The facility is located in a rural area and the supply of 
skilled nursing facility services in the area is not sufficient to meet 
the needs of individuals residing in the area;
    (ii) The facility has one full-time registered nurse who is 
regularly on duty at the facility 40 hours a week; and
    (iii) The facility either--
    (A) Has only patients whose physicians have indicated (through 
physicians' orders or admission notes) that they do not require the 
services of a registered nurse or a physician for a 48-hours period, or
    (B) Has made arrangements for a registered nurse or a physician to 
spend time at the facility, as determined necessary by the physician, to 
provide necessary skilled nursing services on days when the regular 
full-time registered nurse is not on duty;
    (iv) The Secretary provides notice of the waiver to the State long 
term care

[[Page 59]]

ombudsman (established under section 307(a)(12) of the Older Americans 
Act of 1965) and the protection and advocacy system in the State for the 
mentally ill and mentally retarded; and
    (v) The facility that is granted such a waiver notifies residents of 
the facility (or, where appropriate, the guardians or legal 
representatives of such residents) and members of their immediate 
families of the waiver.
    (2) A waiver of the registered nurse requirement under paragraph 
(d)(1) of this section is subject to annual renewal by the Secretary.
    (e) Nurse staffing information--(1) Data requirements. The facility 
must post the following information on a daily basis:
    (i) Facility name.
    (ii) The current date.
    (iii) The total number and the actual hours worked by the following 
categories of licensed and unlicensed nursing staff directly responsible 
for resident care per shift:
    (A) Registered nurses.
    (B) Licensed practical nurses or licensed vocational nurses (as 
defined under State law).
    (C) Certified nurse aides.
    (iv) Resident census.
    (2) Posting requirements. (i) The facility must post the nurse 
staffing data specified in paragraph (e)(1) of this section on a daily 
basis at the beginning of each shift.
    (ii) Data must be posted as follows:
    (A) Clear and readable format.
    (B) In a prominent place readily accessible to residents and 
visitors.
    (3) Public access to posted nurse staffing data. The facility must, 
upon oral or written request, make nurse staffing data available to the 
public for review at a cost not to exceed the community standard.
    (4) Facility data retention requirements. The facility must maintain 
the posted daily nurse staffing data for a minimum of 18 months, or as 
required by State law, whichever is greater.

[56 FR 48873, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992; 
70 FR 62073, Oct. 28, 2005]



Sec.  483.35  Dietary services.

    The facility must provide each resident with a nourishing, 
palatable, well-balanced diet that meets the daily nutritional and 
special dietary needs of each resident.
    (a) Staffing. The facility must employ a qualified dietitian either 
full-time, part-time, or on a consultant basis.
    (1) If a qualified dietitian is not employed full-time, the facility 
must designate a person to serve as the director of food service who 
receives frequently scheduled consultation from a qualified dietitian.
    (2) A qualified dietitian is one who is qualified based upon either 
registration by the Commission on Dietetic Registration of the American 
Dietetic Association, or on the basis of education, training, or 
experience in identification of dietary needs, planning, and 
implementation of dietary programs.
    (b) Sufficient staff. The facility must employ sufficient support 
personnel competent to carry out the functions of the dietary service.
    (c) Menus and nutritional adequacy. Menus must--
    (1) Meet the nutritional needs of residents in accordance with the 
recommended dietary allowances of the Food and Nutrition Board of the 
National Research Council, National Academy of Sciences;
    (2) Be prepared in advance; and
    (3) Be followed.
    (d) Food. Each resident receives and the facility provides--
    (1) Food prepared by methods that conserve nutritive value, flavor, 
and appearance;
    (2) Food that is palatable, attractive, and at the proper 
temperature;
    (3) Food prepared in a form designed to meet individual needs; and
    (4) Substitutes offered of similar nutritive value to residents who 
refuse food served.
    (e) Therapeutic diets. Therapeutic diets must be prescribed by the 
attending physician.
    (f) Frequency of meals. (1) Each resident receives and the facility 
provides at least three meals daily, at regular times comparable to 
normal mealtimes in the community.
    (2) There must be no more than 14 hours between a substantial 
evening meal and breakfast the following day, except as provided in (4) 
below.
    (3) The facility must offer snacks at bedtime daily.

[[Page 60]]

    (4) When a nourishing snack is provided at bedtime, up to 16 hours 
may elapse between a substantial evening meal and breakfast the 
following day if a resident group agrees to this meal span, and a 
nourishing snack is served.
    (g) Assistive devices. The facility must provide special eating 
equipment and utensils for residents who need them.
    (h) Paid feeding assistants--(1) State-approved training course. A 
facility may use a paid feeding assistant, as defined in Sec.  488.301 
of this chapter, if--
    (i) The feeding assistant has successfully completed a State-
approved training course that meets the requirements of Sec.  483.160 
before feeding residents; and
    (ii) The use of feeding assistants is consistent with State law.
    (2) Supervision. (i) A feeding assistant must work under the 
supervision of a registered nurse (RN) or licensed practical nurse 
(LPN).
    (ii) In an emergency, a feeding assistant must call a supervisory 
nurse for help on the resident call system.
    (3) Resident selection criteria. (i) A facility must ensure that a 
feeding assistant feeds only residents who have no complicated feeding 
problems.
    (ii) Complicated feeding problems include, but are not limited to, 
difficulty swallowing, recurrent lung aspirations, and tube or 
parenteral/IV feedings.
    (iii) The facility must base resident selection on the charge 
nurse's assessment and the resident's latest assessment and plan of 
care.
    (i) Sanitary conditions. The facility must--
    (1) Procure food from sources approved or considered satisfactory by 
Federal, State, or local authorities;
    (2) Store, prepare, distribute, and serve food under sanitary 
conditions; and
    (3) Dispose of garbage and refuse properly.

[56 FR 48874, Sept. 26, 1991, as amended at 68 FR 55539, Sept. 26, 2003]



Sec.  483.40  Physician services.

    A physician must personally approve in writing a recommendation that 
an individual be admitted to a facility. Each resident must remain under 
the care of a physician.
    (a) Physician supervision. The facility must ensure that--
    (1) The medical care of each resident is supervised by a physician; 
and
    (2) Another physician supervises the medical care of residents when 
their attending physician is unavailable.
    (b) Physician visits. The physician must--
    (1) Review the resident's total program of care, including 
medications and treatments, at each visit required by paragraph (c) of 
this section;
    (2) Write, sign, and date progress notes at each visit; and
    (3) Sign and date all orders with the exception of influenza and 
pneumococcal polysaccharide vaccines, which may be administered per 
physician-approved facility policy after an assessment for 
contraindications.
    (c) Frequency of physician visits. (1) The resident must be seen by 
a physician at least once every 30 days for the first 90 days after 
admission, and at least once every 60 days thereafter.
    (2) A physician visit is considered timely if it occurs not later 
than 10 days after the date the visit was required.
    (3) Except as provided in paragraphs (c)(4) and (f) of this section, 
all required physician visits must be made by the physician personally.
    (4) At the option of the physician, required visits in SNFs after 
the initial visit may alternate between personal visits by the physician 
and visits by a physician assistant, nurse practitioner, or clinical 
nurse specialist in accordance with paragraph (e) of this section.
    (d) Availability of physicians for emergency care. The facility must 
provide or arrange for the provision of physician services 24 hours a 
day, in case of an emergency.
    (e) Physician delegation of tasks in SNFs. (1) Except as specified 
in paragraph (e)(2) of this section, a physician may delegate tasks to a 
physician assistant, nurse practitioner, or clinical nurse specialist 
who--
    (i) Meets the applicable definition in Sec.  491.2 of this chapter 
or, in the case of a clinical nurse specialist, is licensed as such by 
the State;
    (ii) Is acting within the scope of practice as defined by State law; 
and

[[Page 61]]

    (iii) Is under the supervision of the physician.
    (2) A physician may not delegate a task when the regulations specify 
that the physician must perform it personally, or when the delegation is 
prohibited under State law or by the facility's own policies.
    (f) Performance of physician tasks in NFs. At the option of the 
State, any required physician task in a NF (including tasks which the 
regulations specify must be performed personally by the physician) may 
also be satisfied when performed by a nurse practitioner, clinical nurse 
specialist, or physician assistant who is not an employee of the 
facility but who is working in collaboration with a physician.

[56 FR 48875, Sept. 26, 1991, as amended at 67 FR 61814, Oct. 2, 2002]



Sec.  483.45  Specialized rehabilitative services.

    (a) Provision of services. If specialized rehabilitative services 
such as but not limited to physical therapy, speech-language pathology, 
occupational therapy, and mental health rehabilitative services for 
mental illness and mental retardation, are required in the resident's 
comprehensive plan of care, the facility must--
    (1) Provide the required services; or
    (2) Obtain the required services from an outside resource (in 
accordance with Sec.  483.75(h) of this part) from a provider of 
specialized rehabilitative services.
    (b) Qualifications. Specialized rehabilitative services must be 
provided under the written order of a physician by qualified personnel.

[56 FR 48875, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992]



Sec.  483.55  Dental services.

    The facility must assist residents in obtaining routine and 24-hour 
emergency dental care.
    (a) Skilled nursing facilities. A facility (1) Must provide or 
obtain from an outside resource, in accordance with Sec.  483.75(h) of 
this part, routine and emergency dental services to meet the needs of 
each resident;
    (2) May charge a Medicare resident an additional amount for routine 
and emergency dental services;
    (3) Must if necessary, assist the resident--
    (i) In making appointments; and
    (ii) By arranging for transportation to and from the dentist's 
office; and
    (4) Promptly refer residents with lost or damaged dentures to a 
dentist.
    (b) Nursing facilities. The facility (1) Must provide or obtain from 
an outside resource, in accordance with Sec.  483.75(h) of this part, 
the following dental services to meet the needs of each resident:
    (i) Routine dental services (to the extent covered under the State 
plan); and
    (ii) Emergency dental services;
    (2) Must, if necessary, assist the resident--
    (i) In making appointments; and
    (ii) By arranging for transportation to and from the dentist's 
office; and
    (3) Must promptly refer residents with lost or damaged dentures to a 
dentist.

[56 FR 48875, Sept. 26, 1991]



Sec.  483.60  Pharmacy services.

    The facility must provide routine and emergency drugs and 
biologicals to its residents, or obtain them under an agreement 
described in Sec.  483.75(h) of this part. The facility may permit 
unlicensed personnel to administer drugs if State law permits, but only 
under the general supervision of a licensed nurse.
    (a) Procedures. A facility must provide pharmaceutical services 
(including procedures that assure the accurate acquiring, receiving, 
dispensing, and administering of all drugs and biologicals) to meet the 
needs of each resident.
    (b) Service consultation. The facility must employ or obtain the 
services of a licensed pharmacist who--
    (1) Provides consultation on all aspects of the provision of 
pharmacy services in the facility;
    (2) Establishes a system of records of receipt and disposition of 
all controlled drugs in sufficient detail to enable an accurate 
reconciliation; and
    (3) Determines that drug records are in order and that an account of 
all controlled drugs is maintained and periodically reconciled.
    (c) Drug regimen review. (1) The drug regimen of each resident must 
be reviewed at least once a month by a licensed pharmacist.

[[Page 62]]

    (2) The pharmacist must report any irregularities to the attending 
physician and the director of nursing, and these reports must be acted 
upon.
    (d) Labeling of drugs and biologicals. Drugs and biologicals used in 
the facility must be labeled in accordance with currently accepted 
professional principles, and include the appropriate accessory and 
cautionary instructions, and the expiration date when applicable.
    (e) Storage of drugs and biologicals. (1) In accordance with State 
and Federal laws, the facility must store all drugs and biologicals in 
locked compartments under proper temperature controls, and permit only 
authorized personnel to have access to the keys.
    (2) The facility must provide separately locked, permanently affixed 
compartments for storage of controlled drugs listed in Schedule II of 
the Comprehensive Drug Abuse Prevention and Control Act of 1976 and 
other drugs subject to abuse, except when the facility uses single unit 
package drug distribution systems in which the quantity stored is 
minimal and a missing dose can be readily detected.

[56 FR 48875, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992]



Sec.  483.65  Infection control.

    The facility must establish and maintain an infection control 
program designed to provide a safe, sanitary, and comfortable 
environment and to help prevent the development and transmission of 
disease and infection.
    (a) Infection control program. The facility must establish an 
infection control program under which it--
    (1) Investigates, controls, and prevents infections in the facility;
    (2) Decides what procedures, such as isolation, should be applied to 
an individual resident; and
    (3) Maintains a record of incidents and corrective actions related 
to infections.
    (b) Preventing spread of infection. (1) When the infection control 
program determines that a resident needs isolation to prevent the spread 
of infection, the facility must isolate the resident.
    (2) The facility must prohibit employees with a communicable disease 
or infected skin lesions from direct contact with residents or their 
food, if direct contact will transmit the disease.
    (3) The facility must require staff to wash their hands after each 
direct resident contact for which handwashing is indicated by accepted 
professional practice.
    (c) Linens. Personnel must handle, store, process, and transport 
linens so as to prevent the spread of infection.

[56 FR 48876, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992]



Sec.  483.70  Physical environment.

    The facility must be designed, constructed, equipped, and maintained 
to protect the health and safety of residents, personnel and the public.
    (a) Life safety from fire. (1) Except as otherwise provided in this 
section--
    (i) The facility must meet the applicable provisions of the 2000 
edition of the Life Safety Code of the National Fire Protection 
Association. The Director of the Office of the Federal Register has 
approved the NFPA 101 [reg] 2000 edition of the Life Safety 
Code, issued January 14, 2000, for incorporation by reference in 
accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy of the Code is 
available for inspection at the CMS Information Resource Center, 7500 
Security Boulevard, Baltimore, MD or at the National Archives and 
Records Administration (NARA). For information on the availability of 
this material at NARA, call 202-741-6030, or go to: http://
www.archives.gov/federal--register/code--of--federal--regulations/ibr--
locations.html. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269. If any changes in 
this edition of the Code are incorporated by reference, CMS will publish 
notice in the Federal Register to announce the changes.
    (ii) Chapter 19.3.6.3.2, exception number 2 of the adopted edition 
of the LSC does not apply to long-term care facilities.
    (2) After consideration of State survey agency findings, CMS may 
waive specific provisions of the Life Safety ode which, if rigidly 
applied, would result in unreasonable hardship upon the facility, but 
only if the waiver does not

[[Page 63]]

adversely affect the health and safety of the patients.
    (3) The provisions of the Life safety Code do not apply in a State 
where CMS finds, in accordance with applicable provisions of sections 
1819(d)(2)(B)(ii) and 1919(d)(2)(B)(ii) of the Act, that a fire and 
safety code imposed by State law adequately protects patients, residents 
and personnel in long term care facilities.
    (4) Beginning March 13, 2006, a long-term care facility must be in 
compliance with Chapter 19.2.9, Emergency Lighting.
    (5) Beginning March 13, 2006, Chapter 19.3.6.3.2, exception number 2 
does not apply to long-term care facilities.
    (6) Notwithstanding any provisions of the 2000 edition of the Life 
Safety Code to the contrary, a long-term care facility may install 
alcohol-based hand rub dispensers in its facility if--
    (i) Use of alcohol-based hand rub dispensers does not conflict with 
any State or local codes that prohibit or otherwise restrict the 
placement of alcohol-based hand rub dispensers in health care 
facilities;
    (ii) The dispensers are installed in a manner that minimizes leaks 
and spills that could lead to falls;
    (iii) The dispensers are installed in a manner that adequately 
protects against inappropriate access;
    (iv) The dispensers are installed in accordance with chapter 
18.3.2.7 or chapter 19.3.2.7 of the 2000 edition of the Life Safety 
Code, as amended by NFPA Temporary Interim Amendment 00-1(101), issued 
by the Standards Council of the National Fire Protection Association on 
April 15, 2004. The Director of the Office of the Federal Register has 
approved NFPA Temporary Interim Amendment 00-1(101) for incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy 
of the amendment is available for inspection at the CMS Information 
Resource Center, 7500 Security Boulevard, Baltimore, MD and at the 
Office of the Federal Register, 800 North Capitol Street NW., Suite 700, 
Washington, DC. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269; and
    (v) The dispensers are maintained in accordance with dispenser 
manufacturer guidelines.
    (7) A long term care facility must:
    (i) Install, at least, battery-operated single station smoke alarms 
in accordance with the manufacturer's recommendations in resident 
sleeping rooms and common areas.
    (ii) Have a program for inspection, testing, maintenance, and 
battery replacement that conforms to the manufacturer's recommendations 
and that verifies correct operation of the smoke alarms.
    (iii) Exception:
    (A) The facility has system-based smoke detectors in patient rooms 
and common areas that are installed, tested, and maintained in 
accordance with NFPA 72, National Fire Alarm Code, for system-based 
smoke detectors; or
    (B) The facility is fully sprinklered in accordance with NFPA 13, 
Standard for the Installation of Sprinkler Systems.
    (8) A long term care facility must:
    (i) Install an approved, supervised automatic sprinkler system in 
accordance with the 1999 edition of NFPA 13, Standard for the 
Installation of Sprinkler Systems, as incorporated by reference, 
throughout the building by August 13, 2013. The Director of the Office 
of the Federal Register has approved the NFPA 13 1999 edition of the 
Standard for the Installation of Sprinkler Systems, issued July 22, 1999 
for incorporation by reference in accordance with 5 U.S.C. 552(a) and 1 
CFR part 51. A copy of the Code is available for inspection at the CMS 
Information Resource Center, 7500 Security Boulevard, Baltimore, MD or 
at the National Archives and Records Administration (NARA). For 
information on the availability of this material at NARA, call 202-741-
6030, or go to: http://www.archives.gov/federal--register/code--of--
federal--regulations/ibr--locations.html. Copies may be obtained from 
the National Fire Protection Association, 1 Batterymarch Park, Quincy, 
MA 02269.
    (ii) Test, inspect, and maintain an approved, supervised automatic 
sprinkler system in accordance with the 1998 edition of NFPA 25, 
Standard for the Inspection, Testing, and Maintenance of Water-Based 
Fire Protection Systems, as

[[Page 64]]

incorporated by reference. The Director of the Office of the Federal 
Register has approved the NFPA 25, Standard for the Inspection, Testing, 
and Maintenance of Water-Based Fire Protection Systems, 1998 edition, 
issued January 16, 1998 for incorporation by reference in accordance 
with 5 U.S.C. 552(a) and 1 CFR part 51. A copy of the Code is available 
for inspection at the CMS Information Resource Center, 7500 Security 
Boulevard, Baltimore, MD or at the National Archives and Records 
Administration (NARA). For information on the availability of this 
material at NARA, call 202-741-6030, or go to: http://www.archives.gov/
federal--register/code--of--federal--regulations/ibr--locations.html. 
Copies may be obtained from the National Fire Protection Association, 1 
Batterymarch Park, Quincy, MA 02269.
    (b) Emergency power. (1) An emergency electrical power system must 
supply power adequate at least for lighting all entrances and exits; 
equipment to maintain the fire detection, alarm, and extinguishing 
systems; and life support systems in the event the normal electrical 
supply is interrupted.
    (2) When life support systems are used, the facility must provide 
emergency electrical power with an emergency generator (as defined in 
NFPA 99, Health Care Facilities) that is located on the premises.
    (c) Space and equipment. The facility must--
    (1) Provide sufficient space and equipment in dining, health 
services, recreation, and program areas to enable staff to provide 
residents with needed services as required by these standards and as 
identified in each resident's plan of care; and
    (2) Maintain all essential mechanical, electrical, and patient care 
equipment in safe operating condition.
    (d) Resident rooms. Resident rooms must be designed and equipped for 
adequate nursing care, comfort, and privacy of residents.
    (1) Bedrooms must--
    (i) Accommodate no more than four residents;
    (ii) Measure at least 80 square feet per resident in multiple 
resident bedrooms, and at least 100 square feet in single resident 
rooms;
    (iii) Have direct access to an exit corridor;
    (iv) Be designed or equipped to assure full visual privacy for each 
resident;
    (v) In facilities initially certified after March 31, 1992, except 
in private rooms, each bed must have ceiling suspended curtains, which 
extend around the bed to provide total visual privacy in combination 
with adjacent walls and curtains;
    (vi) Have at least one window to the outside; and
    (vii) Have a floor at or above grade level.
    (2) The facility must provide each resident with--
    (i) A separate bed of proper size and height for the convenience of 
the resident;
    (ii) A clean, comfortable mattress;
    (iii) Bedding appropriate to the weather and climate; and
    (iv) Functional furniture appropriate to the resident's needs, and 
individual closet space in the resident's bedroom with clothes racks and 
shelves accessible to the resident.
    (3) CMS, or in the case of a nursing facility the survey agency, may 
permit variations in requirements specified in paragraphs (d)(1) (i) and 
(ii) of this section relating to rooms in individual cases when the 
facility demonstrates in writing that the variations--
    (i) Are in accordance with the special needs of the residents; and
    (ii) Will not adversely affect residents' health and safety.
    (e) Toilet facilities. Each resident room must be equipped with or 
located near toilet and bathing facilities.
    (f) Resident call system. The nurse's station must be equipped to 
receive resident calls through a communication system from--
    (1) Resident rooms; and
    (2) Toilet and bathing facilities.
    (g) Dining and resident activities. The facility must provide one or 
more rooms designated for resident dining and activities. These rooms 
must--
    (1) Be well lighted;
    (2) Be well ventilated, with nonsmoking areas identified;
    (3) Be adequately furnished; and
    (4) Have sufficient space to accommodate all activities.

[[Page 65]]

    (h) Other environmental conditions. The facility must provide a 
safe, functional, sanitary, and comfortable environment for the 
residents, staff and the public. The facility must--
    (1) Establish procedures to ensure that water is available to 
essential areas when there is a loss of normal water supply;
    (2) Have adequate outside ventilation by means of windows, or 
mechanical ventilation, or a combination of the two;
    (3) Equip corridors with firmly secured handrails on each side; and
    (4) Maintain an effective pest control program so that the facility 
is free of pests and rodents.

[56 FR 48876, Sept. 26, 1991, as amended at 57 FR 43925, Sept. 23, 1992; 
68 FR 1386, Jan. 10, 2003; 69 FR 49268, Aug. 11, 2004; 70 FR 15238, Mar. 
25, 2005; 71 FR 55340, Sept. 22, 2006; 73 FR 47091, Aug. 13, 2008]



Sec.  483.75  Administration.

    A facility must be administered in a manner that enables it to use 
its resources effectively and efficiently to attain or maintain the 
highest practicable physical, mental, and psychosocial well-being of 
each resident.
    (a) Licensure. A facility must be licensed under applicable State 
and local law.
    (b) Compliance with Federal, State, and local laws and professional 
standards. The facility must operate and provide services in compliance 
with all applicable Federal, State, and local laws, regulations, and 
codes, and with accepted professional standards and principles that 
apply to professionals providing services in such a facility.
    (c) Relationship to other HHS regulations. In addition to compliance 
with the regulations set forth in this subpart, facilities are obliged 
to meet the applicable provisions of other HHS regulations, including 
but not limited to those pertaining to nondiscrimination on the basis of 
race, color, or national origin (45 CFR part 80); nondiscrimination on 
the basis of handicap (45 CFR part 84); nondiscrimination on the basis 
of age (45 CFR part 91); protection of human subjects of research (45 
CFR part 46); and fraud and abuse (42 CFR part 455). Although these 
regulations are not in themselves considered requirements under this 
part, their violation may result in the termination or suspension of, or 
the refusal to grant or continue payment with Federal funds.
    (d) Governing body. (1) The facility must have a governing body, or 
designated persons functioning as a governing body, that is legally 
responsible for establishing and implementing policies regarding the 
management and operation of the facility; and
    (2) The governing body appoints the administrator who is--
    (i) Licensed by the State where licensing is required; and
    (ii) Responsible for management of the facility.
    (e) Required training of nursing aides--(1) Definitions.
    Licensed health professional means a physician; physician assistant; 
nurse practitioner; physical, speech, or occupational therapist; 
physical or occupational therapy assistant; registered professional 
nurse; licensed practical nurse; or licensed or certified social worker.
    Nurse aide means any individual providing nursing or nursing-related 
services to residents in a facility who is not a licensed health 
professional, a registered dietitian, or someone who volunteers to 
provide such services without pay. Nurse aides do not include those 
individuals who furnish services to residents only as paid feeding 
assistants as defined in Sec.  488.301 of this chapter.
    (2) General rule. A facility must not use any individual working in 
the facility as a nurse aide for more than 4 months, on a full-time 
basis, unless:
    (i) That individual is competent to provide nursing and nursing 
related services; and
    (ii)(A) That individual has completed a training and competency 
evaluation program, or a competency evaluation program approved by the 
State as meeting the requirements of Sec. Sec.  483.151-483.154 of this 
part; or
    (B) That individual has been deemed or determined competent as 
provided in Sec.  483.150 (a) and (b).
    (3) Non-permanent employees. A facility must not use on a temporary, 
per diem, leased, or any basis other than a permanent employee any 
individual who does not meet the requirements in

[[Page 66]]

paragraphs (e)(2) (i) and (ii) of this section.
    (4) Competency. A facility must not use any individual who has 
worked less than 4 months as a nurse aide in that facility unless the 
individual--
    (i) Is a full-time employee in a State-approved training and 
competency evaluation program;
    (ii) Has demonstrated competence through satisfactory participation 
in a State-approved nurse aide training and competency evaluation 
program or competency evaluation program; or
    (iii) Has been deemed or determined competent as provided in Sec.  
483.150 (a) and (b).
    (5) Registry verification. Before allowing an individual to serve as 
a nurse aide, a facility must receive registry verification that the 
individual has met competency evaluation requirements unless--
    (i) The individual is a full-time employee in a training and 
competency evaluation program approved by the State; or
    (ii) The individual can prove that he or she has recently 
successfully completed a training and competency evaluation program or 
competency evaluation program approved by the State and has not yet been 
included in the registry. Facilities must follow up to ensure that such 
an individual actually becomes registered.
    (6) Multi-State registry verification. Before allowing an individual 
to serve as a nurse aide, a facility must seek information from every 
State registry established under sections 1819(e)(2)(A) or 1919(e)(2)(A) 
of the Act the facility believes will include information on the 
individual.
    (7) Required retraining. If, since an individual's most recent 
completion of a training and competency evaluation program, there has 
been a continuous period of 24 consecutive months during none of which 
the individual provided nursing or nursing-related services for monetary 
compensation, the individual must complete a new training and competency 
evaluation program or a new competency evaluation program.
    (8) Regular in-service education. The facility must complete a 
performance review of every nurse aide at least once every 12 months, 
and must provide regular in-service education based on the outcome of 
these reviews. The in-service training must--
    (i) Be sufficient to ensure the continuing competence of nurse 
aides, but must be no less than 12 hours per year;
    (ii) Address areas of weakness as determined in nurse aides' 
performance reviews and may address the special needs of residents as 
determined by the facility staff; and
    (iii) For nurse aides providing services to individuals with 
cognitive impairments, also address the care of the cognitively 
impaired.
    (f) Proficiency of Nurse aides. The facility must ensure that nurse 
aides are able to demonstrate competency in skills and techniques 
necessary to care for residents' needs, as identified through resident 
assessments, and described in the plan of care.
    (g) Staff qualifications. (1) The facility must employ on a full-
time, part-time or consultant basis those professionals necessary to 
carry out the provisions of these requirements.
    (2) Professional staff must be licensed, certified, or registered in 
accordance with applicable State laws.
    (h) Use of outside resources. (1) If the facility does not employ a 
qualified professional person to furnish a specific service to be 
provided by the facility, the facility must have that service furnished 
to residents by a person or agency outside the facility under an 
arrangement described in section 1861(w) of the Act or (with respect to 
services furnished to NF residents and dental services furnished to SNF 
residents) an agreement described in paragraph (h)(2) of this section.
    (2) Arrangements as described in section 1861(w) of the Act or 
agreements pertaining to services furnished by outside resources must 
specify in writing that the facility assumes responsibility for--
    (i) Obtaining services that meet professional standards and 
principles that apply to professionals providing services in such a 
facility; and
    (ii) The timeliness of the services.
    (i) Medical director. (1) The facility must designate a physician to 
serve as medical director.
    (2) The medical director is responsible for--

[[Page 67]]

    (i) Implementation of resident care policies; and
    (ii) The coordination of medical care in the facility.
    (j) Laboratory services. (1) The facility must provide or obtain 
laboratory services to meet the needs of its residents. The facility is 
responsible for the quality and timeliness of the services.
    (i) If the facility provides its own laboratory services, the 
services must meet the applicable requirements for laboratories 
specified in part 493 of this chapter.
    (ii) If the facility provides blood bank and transfusion services, 
it must meet the applicable requirements for laboratories specified in 
part 493 of this chapter.
    (iii) If the laboratory chooses to refer specimens for testing to 
another laboratory, the referral laboratory must be certified in the 
appropriate specialties and subspecialties of services in accordance 
with the requirements of part 493 of this chapter.
    (iv) If the facility does not provide laboratory services on site, 
it must have an agreement to obtain these services from a laboratory 
that meets the applicable requirements of part 493 of this chapter.
    (2) The facility must--
    (i) Provide or obtain laboratory services only when ordered by the 
attending physician;
    (ii) Promptly notify the attending physican of the findings;
    (iii) Assist the resident in making transportation arrangements to 
and from the source of service, if the resident needs asistance; and
    (iv) File in the resident's clinical record laboratory reports that 
are dated and contain the name and address of the testing laboratory.
    (k) Radiology and other diagnostic services. (1) The facility must 
provide or obtain radiology and other diagnostic services to meet the 
needs of its residents. The facility is responsible for the quality and 
timeliness of the services.
    (i) If the facility provides its own diagnostic services, the 
services must meet the applicable conditions of participation for 
hospitals contained in Sec.  482.26 of this subchapter.
    (ii) If the facility does not provide its own diagnostic services, 
it must have an agreement to obtain these services from a provider or 
supplier that is approved to provide these services under Medicare.
    (2) The facility must--
    (i) Provide or obtain radiology and other diagnostic services only 
when ordered by the attending physician;
    (ii) Promptly notify the attending physician of the findings;
    (iii) Assist the resident in making transportation arrangements to 
and from the source of service, if the resident needs assistance; and
    (iv) File in the resident's clinical record signed and dated reports 
of x-ray and other diagnostic services.
    (l) Clinical records. (1) The facility must maintain clinical 
records on each resident in accordance with accepted professional 
standards and practices that are--
    (i) Complete;
    (ii) Accurately documented;
    (iii) Readily accessible; and
    (iv) Systematically organized.
    (2) Clinical records must be retained for--
    (i) The period of time required by State law; or
    (ii) Five years from the date of discharge when there is no 
requirement in State law; or
    (iii) For a minor, three years after a resident reaches legal age 
under State law.
    (3) The facility must safeguard clinical record information against 
loss, destruction, or unauthorized use;
    (4) The facility must keep confidential all information contained in 
the resident's records, regardless of the form or storage method of the 
records, except when release is required by--
    (i) Transfer to another health care institution;
    (ii) Law;
    (iii) Third party payment contract; or
    (iv) The resident.
    (5) The clinical record must contain--
    (i) Sufficient information to identify the resident;
    (ii) A record of the resident's assessments;
    (iii) The plan of care and services provided;

[[Page 68]]

    (iv) The results of any preadmission screening conducted by the 
State; and
    (v) Progress notes.
    (m) Disaster and emergency preparedness. (1) The facility must have 
detailed written plans and procedures to meet all potential emergencies 
and disasters, such as fire, severe weather, and missing residents.
    (2) The facility must train all employees in emergency procedures 
when they begin to work in the facility, periodically review the 
procedures with existing staff, and carry out unannounced staff drills 
using those procedures.
    (n) Transfer agreement. (1) In accordance with section 1861(l) of 
the Act, the facility (other than a nursing facility which is located in 
a State on an Indian reservation) must have in effect a written transfer 
agreement with one or more hospitals approved for participation under 
the Medicare and Medicaid programs that reasonably assures that--
    (i) Residents will be transferred from the facility to the hospital, 
and ensured of timely admission to the hospital when transfer is 
medically appropriate as determined by the attending physician; and
    (ii) Medical and other information needed for care and treatment of 
residents, and, when the transferring facility deems it appropriate, for 
determining whether such residents can be adequately cared for in a less 
expensive setting than either the facility or the hospital, will be 
exchanged between the institutions.
    (2) The facility is considered to have a transfer agreement in 
effect if the facility has attempted in good faith to enter into an 
agreement with a hospital sufficiently close to the facility to make 
transfer feasible.
    (o) Quality assessment and assurance. (1) A facility must maintain a 
quality assessment and assurance committee consisting of--
    (i) The director of nursing services;
    (ii) A physician designated by the facility; and
    (iii) At least 3 other members of the facility's staff.
    (2) The quality assessment and assurance committee--
    (i) Meets at least quarterly to identify issues with respect to 
which quality assessment and assurance activities are necessary; and
    (ii) Develops and implements appropriate plans of action to correct 
identified quality deficiencies.
    (3) A State or the Secretary may not require disclosure of the 
records of such committee except in so far as such disclosure is related 
to the compliance of such committee with the requirements of this 
section.
    (4) Good faith attempts by the committee to identify and correct 
quality deficiencies will not be used as a basis for sanctions.
    (p) Disclosure of ownership. (1) The facility must comply with the 
disclosure requirements of Sec. Sec.  420.206 and 455.104 of this 
chapter.
    (2) The facility must provide written notice to the State agency 
responsible for licensing the facility at the time of change, if a 
change occurs in--
    (i) Persons with an ownership or control interest, as defined in 
Sec. Sec.  420.201 and 455.101 of this chapter;
    (ii) The officers, directors, agents, or managing employees;
    (iii) The corporation, association, or other company responsible for 
the management of the facility; or
    (iv) The facility's administrator or director of nursing.
    (3) The notice specified in paragraph (p)(2) of this section must 
include the identity of each new individual or company.
    (q) Required training of feeding assistants. A facility must not use 
any individual working in the facility as a paid feeding assistant 
unless that individual has successfully completed a State-approved 
training program for feeding assistants, as specified in Sec.  483.160 
of this part.

[56 FR 48877, Sept. 26, 1991, as amended at 56 FR 48918, Sept. 26, 1991; 
57 FR 7136, Feb. 28, 1992; 57 FR 43925, Sept. 23, 1992; 59 FR 56237, 
Nov. 10, 1994; 63 FR 26311, May 12, 1998; 68 FR 55539, Sept. 26, 2003; 
74 FR 40363, Aug. 11, 2009]



 Subpart C_Preadmission Screening and Annual Review of Mentally Ill and 
                      Mentally Retarded Individuals

    Source: 57 FR 56506, Nov. 30, 1992, unless otherwise noted.

[[Page 69]]



Sec.  483.100  Basis.

    The requirements of Sec. Sec.  483.100 through 483.138 governing the 
State's responsibility for preadmission screening and annual resident 
review (PASARR) of individuals with mental illness and mental 
retardation are based on section 1919(e)(7) of the Act.



Sec.  483.102  Applicability and definitions.

    (a) This subpart applies to the screening or reviewing of all 
individuals with mental illness or mental retardation who apply to or 
reside in Medicaid certified NFs regardless of the source of payment for 
the NF services, and regardless of the individual's or resident's known 
diagnoses.
    (b) Definitions. As used in this subpart--
    (1) An individual is considered to have a serious mental illness 
(MI) if the individual meets the following requirements on diagnosis, 
level of impairment and duration of illness:
    (i) Diagnosis. The individual has a major mental disorder 
diagnosable under the Diagnostic and Statistical Manual of Mental 
Disorders, 3rd edition, revised in 1987.
    Incorporation of the 1987 edition of the Diagnostic and Statistical 
Manual of Mental Disorders, 3rd edition, was approved by the Director of 
the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 
51 that govern the use of incorporation by reference. \1\
---------------------------------------------------------------------------

    \1\ The Diagnostic and Statistical Manual of Mental Disorders is 
available for inspection at the Centers for Medicare & Medicaid 
Services, room 132, East High Rise Building, 6325 Security Boulevard, 
Baltimore, Maryland, or at the National Archives and Records 
Administration (NARA). For information on the availability of this 
material at NARA, call 202-741-6030, or go to: http://www.archives.gov/
federal--register/code--of--federal--regulations/ibr--locations.html. 
Copies may be obtained from the American Psychiatric Association, 
Division of Publications and Marketing, 1400 K Street, NW., Washington, 
DC 20005.
---------------------------------------------------------------------------

    This mental disorder is--
    (A) A schizophrenic, mood, paranoid, panic or other severe anxiety 
disorder; somatoform disorder; personality disorder; other psychotic 
disorder; or another mental disorder that may lead to a chronic 
disability; but
    (B) Not a primary diagnosis of dementia, including Alzheimer's 
disease or a related disorder, or a non-primary diagnosis of dementia 
unless the primary diagnosis is a major mental disorder as defined in 
paragraph (b)(1)(i)(A) of this section.
    (ii) Level of impairment. The disorder results in functional 
limitations in major life activities within the past 3 to 6 months that 
would be appropriate for the individual's developmental stage. An 
individual typically has at least one of the following characteristics 
on a continuing or intermittent basis:
    (A) Interpersonal functioning. The individual has serious difficulty 
interacting appropriately and communicating effectively with other 
persons, has a possible history of altercations, evictions, firing, fear 
of strangers, avoidance of interpersonal relationships and social 
isolation;
    (B) Concentration, persistence, and pace. The individual has serious 
difficulty in sustaining focused attention for a long enough period to 
permit the completion of tasks commonly found in work settings or in 
work-like structured activities occurring in school or home settings, 
manifests difficulties in concentration, inability to complete simple 
tasks within an established time period, makes frequent errors, or 
requires assistance in the completion of these tasks; and
    (C) Adaptation to change. The individual has serious difficulty in 
adapting to typical changes in circumstances associated with work, 
school, family, or social interaction, manifests agitation, exacerbated 
signs and symptoms associated with the illness, or withdrawal from the 
situation, or requires intervention by the mental health or judicial 
system.
    (iii) Recent treatment. The treatment history indicates that the 
individual has experienced at least one of the following:
    (A) Psychiatric treatment more intensive than outpatient care more 
than once in the past 2 years (e.g., partial hospitalization or 
inpatient hospitalization); or
    (B) Within the last 2 years, due to the mental disorder, experienced 
an episode of significant disruption to the

[[Page 70]]

normal living situation, for which supportive services were required to 
maintain functioning at home, or in a residential treatment environment, 
or which resulted in intervention by housing or law enforcement 
officials.
    (2) An individual is considered to have dementia if he or she has a 
primary diagnosis of dementia, as described in the Diagnostic and 
Statistical Manual of Mental Disorders, 3rd edition, revised in 1987, or 
a non-primary diagnosis of dementia unless the primary diagnosis is a 
major mental disorder as defined in paragraph (b)(1)(i)(A) of this 
section.
    (3) An individual is considered to have mental retardation (MR) if 
he or she has--
    (i) A level of retardation (mild, moderate, severe or profound) 
described in the American Association on Mental Retardation's Manual on 
Classification in Mental Retardation (1983). Incorporation by reference 
of the 1983 edition of the American Association on Mental Retardation's 
Manual on Classification in Mental Retardation was approved by the 
Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 
1 CFR part 51 that govern the use of incorporations by reference;\2\ or
---------------------------------------------------------------------------

    \2\ The American Association on Mental Retardation's Manual on 
Classification in Mental Retardation is available for inspection at the 
Centers for Medicare & Medicaid Services, Room 132, East High Rise 
Building, 6325 Security Boulevard, Baltimore, Maryland, or at the 
National Archives and Records Administration (NARA). For information on 
the availability of this material at NARA, call 202-741-6030, or go to: 
http://www.archives.gov/federal--register/code--of--federal--
regulations/ibr--locations.html. Copies may be obtained from the 
American Association on Mental Retardation, 1719 Kalorama Rd., NW., 
Washington, DC 20009.
---------------------------------------------------------------------------

    (ii) A related condition as defined by Sec.  435.1010 of this 
chapter.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993; 71 FR 39229, 
July 12, 2006]



Sec.  483.104  State plan requirement.

    As a condition of approval of the State plan, the State must operate 
a preadmission screening and annual resident review program that meets 
the requirements of Sec. Sec.  483.100 through 438.138.



Sec.  483.106  Basic rule.

    (a) Requirement. The State PASARR program must require--(1) 
Preadmission screening of all individuals with mental illness or mental 
retardation who apply as new admissions to Medicaid NFs on or after 
January 1, 1989;
    (2) Initial review, by April 1, 1990, of all current residents with 
mental retardation or mental illness who entered Medicaid NFs prior to 
January 1, 1989; and
    (3) At least annual review, as of April 1, 1990, of all residents 
with mental illness or mental retardation, regardless of whether they 
were first screened under the preadmission screening or annual resident 
review requirements.
    (b) Admissions, readmissions and interfacility transfers--(1) New 
admission. An individual is a new admission if he or she is admitted to 
any NF for the first time or does not qualify as a readmission. With the 
exception of certain hospital discharges described in paragraph (b)(2) 
of this section, new admissions are subject to preadmission screening.
    (2) Exempted hospital discharge. (i) An exempted hospital discharge 
means an individual--
    (A) Who is admitted to any NF directly from a hospital after 
receiving acute inpatient care at the hospital;
    (B) Who requires NF services for the condition for which he or she 
received care in the hospital; and
    (C) Whose attending physician has certified before admission to the 
facility that the individual is likely to require less than 30 days 
nursing facility services.
    (ii) If an individual who enters a NF as an exempted hospital 
discharge is later found to require more than 30 days of NF care, the 
State mental health or mental retardation authority must conduct an 
annual resident review within 40 calendar days of admission.
    (3) Readmissions. An individual is a readmission if he or she was 
readmitted to a facility from a hospital to which he or she was 
transferred for

[[Page 71]]

the purpose of receiving care. Readmissions are subject to annual 
resident review rather than preadmission screening.
    (4) Interfacility transfers--(i) An interfacility transfer occurs 
when an individual is transferred from one NF to another NF, with or 
without an intervening hospital stay. Interfacility transfers are 
subject to annual resident review rather than preadmission screening.
    (ii) In cases of transfer of a resident with MI or MR from a NF to a 
hospital or to another NF, the transferring NF is responsible for 
ensuring that copies of the resident's most recent PASARR and resident 
assessment reports accompany the transferring resident.
    (c) Purpose. The preadmission screening and annual resident review 
process must result in determinations based on a physical and mental 
evaluation of each individual with mental illness or mental retardation, 
that are described in Sec. Sec.  483.112 and 483.114.
    (d) Responsibility for evaluations and determinations. The PASARR 
determinations of whether an individual requires the level of services 
provided by a NF and whether specialized services are needed--
    (1) For individuals with mental illness, must be made by the State 
mental health authority and be based on an independent physical and 
mental evaluation performed by a person or entity other than the State 
mental health authority; and
    (2) For individuals with mental retardation, must be made by the 
State mental retardation or developmental disabilities authority.
    (e) Delegation of responsibility--(1) The State mental health and 
mental retardation authorities may delegate by subcontract or otherwise 
the evaluation and determination functions for which they are 
responsible to another entity only if--
    (i) The State mental health and mental retardation authorities 
retain ultimate control and responsibility for the performance of their 
statutory obligations;
    (ii) The two determinations as to the need for NF services and for 
specialized services are made, based on a consistent analysis of the 
data; and
    (iii) The entity to which the delegation is made is not a NF or an 
entity that has a direct or indirect affiliation or relationship with a 
NF.
    (2) The State mental retardation authority has responsibility for 
both the evaluation and determination functions for individuals with MR 
whereas the State mental health authority has responsibility only for 
the determination function.
    (3) The evaluation of individuals with MI cannot be delegated by the 
State mental health authority because it does not have responsibility 
for this function. The evaluation function must be performed by a person 
or entity other than the State mental health authority. In designating 
an independent person or entity to perform MI evaluations, the State 
must not use a NF or an entity that has a direct or indirect affiliation 
or relationship with a NF.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993]



Sec.  483.108  Relationship of PASARR to other Medicaid processes.

    (a) PASARR determinations made by the State mental health or mental 
retardation authorities cannot be countermanded by the State Medicaid 
agency, either in the claims process or through other utilization 
control/review processes or by the State survey and certification 
agency. Only appeals determinations made through the system specified in 
subpart E of this part may overturn a PASARR determination made by the 
State mental health or mental retardation authorities.
    (b) In making their determinations, however, the State mental health 
and mental retardation authorities must not use criteria relating to the 
need for NF care or specialized services that are inconsistent with this 
regulation and any supplementary criteria adopted by the State Medicaid 
agency under its approved State plan.
    (c) To the maximum extent practicable, in order to avoid duplicative 
testing and effort, the PASARR must be coordinated with the routine 
resident assessments required by Sec.  483.20(b).



Sec.  483.110  Out-of-State arrangements.

    (a) Basic rule. The State in which the individual is a State 
resident (or would

[[Page 72]]

be a State resident at the time he or she becomes eligible for 
Medicaid), as defined in Sec.  435.403 of this chapter, must pay for the 
PASARR and make the required determinations, in accordance with Sec.  
431.52(b).
    (b) Agreements. A State may include arrangements for PASARR in its 
provider agreements with out-of-State facilities or reciprocal 
interstate agreements.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993]



Sec.  483.112  Preadmission screening of applicants for admission to NFs.

    (a) Determination of need for NF services. For each NF applicant 
with MI or MR, the State mental health or mental retardation authority 
(as appropriate) must determine, in accordance with Sec.  483.130, 
whether, because of the resident's physical and mental condition, the 
individual requires the level of services provided by a NF.
    (b) Determination of need for specialized services. If the 
individual with mental illness or mental retardation is determined to 
require a NF level of care, the State mental health or mental 
retardation authority (as appropriate) must also determine, in 
accordance with Sec.  483.130, whether the individual requires 
specialized services for the mental illness or mental retardation, as 
defined in Sec.  483.120.
    (c) Timeliness--(1) Except as specified in paragraph (c)(4) of this 
section, a preadmission screening determination must be made in writing 
within an annual average of 7 to 9 working days of referral of the 
individual with MI or MR by whatever agent performs the Level I 
identification, under Sec.  483.128(a) of this part, to the State mental 
health or mental retardation authority for screening. (See Sec.  
483.128(a) for discussion of Level I evaluation.)
    (2) The State may convey determinations verbally to nursing 
facilities and the individual and confirm them in writing.
    (3) The State may compute separate annual averages for the mentally 
ill and the mentally retarded/developmentally disabled populations.
    (4) The Secretary may grant an exception to the timeliness standard 
in paragraph (c)(1) of this section when the State--
    (i) Exceeds the annual average; and
    (ii) Provides justification satisfactory to the Secretary that a 
longer time period was necessary.



Sec.  483.114  Annual review of NF residents.

    (a) Individuals with mental illness. For each resident of a NF who 
has mental illness, the State mental health authority must determine in 
accordance with Sec.  483.130 whether, because of the resident's 
physical and mental condition, the resident requires--
    (1) The level of services provided by--
    (i) A NF;
    (ii) An inpatient psychiatric hospital for individuals under age 21, 
as described in section 1905(h) of the Act; or
    (iii) An institution for mental diseases providing medical 
assistance to individuals age 65 or older; and
    (2) Specialized services for mental illness, as defined in Sec.  
483.120.
    (b) Individuals with mental retardation. For each resident of a NF 
who has mental retardation, the State mental retardation or 
developmental disability authority must determine in accordance with 
Sec.  483.130 whether, because of his or her physical or mental 
condition, the resident requires--
    (1) The level of services provided by a NF or an intermediate care 
facility for the mentally retarded; and
    (2) Specialized services for mental retardation as defined in Sec.  
483.120.
    (c) Frequency of review--(1) A review and determination must be 
conducted for each resident of a Medicaid NF who has mental illness or 
mental retardation not less often than annually.
    (2) ``Annually'' is defined as occurring within every fourth quarter 
after the previous preadmission screen or annual resident review.
    (d) April 1, 1990 deadline for initial reviews. The first set of 
annual reviews on residents who entered the NF prior to January 1, 1989, 
must be completed by April 1, 1990.

[[Page 73]]



Sec.  483.116  Residents and applicants determined to require NF level of services.

    (a) Individuals needing NF services. If the State mental health or 
mental retardation authority determines that a resident or applicant for 
admission to a NF requires a NF level of services, the NF may admit or 
retain the individual.
    (b) Individuals needing NF services and specialized services. If the 
State mental health or mental retardation authority determines that a 
resident or applicant for admission requires both a NF level of services 
and specialized services for the mental illness or mental retardation--
    (1) The NF may admit or retain the individual; and
    (2) The State must provide or arrange for the provision of the 
specialized services needed by the individual while he or she resides in 
the NF.



Sec.  483.118  Residents and applicants determined not to require NF level of services.

    (a) Applicants who do not require NF services. If the State mental 
health or mental retardation authority determines that an applicant for 
admission to a NF does not require NF services, the applicant cannot be 
admitted. NF services are not a covered Medicaid service for that 
individual, and further screening is not required.
    (b) Residents who require neither NF services nor specialized 
services for MI or MR. If the State mental health or mental retardation 
authority determines that a resident requires neither the level of 
services provided by a NF nor specialized services for MI or MR, 
regardless of the length of stay in the facility, the State must--
    (1) Arrange for the safe and orderly discharge of the resident from 
the facility in accordance with Sec.  483.12(a); and
    (2) Prepare and orient the resident for discharge.
    (c) Residents who do not require NF services but require specialized 
services for MI or MR--(1) Long term residents. Except as otherwise may 
be provided in an alternative disposition plan adopted under section 
1919(e)(7)(E) of the Act, for any resident who has continuously resided 
in a NF for at least 30 months before the date of the determination, and 
who requires only specialized services as defined in Sec.  483.120, the 
State must, in consultation with the resident's family or legal 
representative and caregivers--
    (i) Offer the resident the choice of remaining in the facility or of 
receiving services in an alternative appropriate setting;
    (ii) Inform the resident of the institutional and noninstitutional 
alternatives covered under the State Medicaid plan for the resident;
    (iii) Clarify the effect on eligibility for Medicaid services under 
the State plan if the resident chooses to leave the facility, including 
its effect on readmission to the facility; and
    (iv) Regardless of the resident's choice, provide for, or arrange 
for the provision of specialized services for the mental illness or 
mental retardation.
    (2) Short term residents. Except as otherwise may be provided in an 
alternative disposition plan adopted under section 1919(e)(7)(E) of the 
Act, for any resident who requires only specialized services, as defined 
in Sec.  483.120, and who has not continuously resided in a NF for at 
least 30 months before the date of the determination, the State must, in 
consultation with the resident's family or legal representative and 
caregivers--
    (i) Arrange for the safe and orderly discharge of the resident from 
the facility in accordance with Sec.  483.12(a);
    (ii) Prepare and orient the resident for discharge; and
    (iii) Provide for, or arrange for the provision of, specialized 
services for the mental illness or mental retardation.
    (3) For the purpose of establishing length of stay in a NF, the 30 
months of continuous residence in a NF or longer--
    (i) Is calculated back from the date of the first annual resident 
review determination which finds that the individual is not in need of 
NF level of services;
    (ii) May include temporary absences for hospitalization or 
therapeutic leave; and
    (iii) May consist of consecutive residences in more than one NF.

[[Page 74]]



Sec.  483.120  Specialized services.

    (a) Definition--(1) For mental illness, specialized services means 
the services specified by the State which, combined with services 
provided by the NF, results in the continuous and aggressive 
implementation of an individualized plan of care that--
    (i) Is developed and supervised by an interdisciplinary team, which 
includes a physician, qualified mental health professionals and, as 
appropriate, other professionals.
    (ii) Prescribes specific therapies and activities for the treatment 
of persons experiencing an acute episode of serious mental illness, 
which necessitates supervision by trained mental health personnel; and
    (iii) Is directed toward diagnosing and reducing the resident's 
behavioral symptoms that necessitated institutionalization, improving 
his or her level of independent functioning, and achieving a functioning 
level that permits reduction in the intensity of mental health services 
to below the level of specialized services at the earliest possible 
time.
    (2) For mental retardation, specialized services means the services 
specified by the State which, combined with services provided by the NF 
or other service providers, results in treatment which meets the 
requirements of Sec.  483.440(a)(1).
    (b) Who must receive specialized services. The State must provide or 
arrange for the provision of specialized services, in accordance with 
this subpart, to all NF residents with MI or MR whose needs are such 
that continuous supervision, treatment and training by qualified mental 
health or mental retardation personnel is necessary, as identified by 
the screening provided in Sec.  483.130 or Sec. Sec.  483.134 and 
483.136.
    (c) Services of lesser intensity than specialized services. The NF 
must provide mental health or mental retardation services which are of a 
lesser intensity than specialized services to all residents who need 
such services.



Sec.  483.122  FFP for NF services.

    (a) Basic rule. Except as otherwise may be provided in an 
alternative disposition plan adopted under section 1919(e)(7)(E) of the 
Act, FFP is available in State expenditures for NF services provided to 
a Medicaid eligible individual subject to the requirements of this part 
only if the individual has been determined--
    (1) To need NF care under Sec.  483.116(a) or
    (2) Not to need NF services but to need specialized services, meets 
the requirements of Sec.  483.118(c)(1), and elects to stay in the NF.
    (b) FFP for late reviews. When a preadmission screening has not been 
performed prior to admission or an annual review is not performed 
timely, in accordance with Sec.  483.114(c), but either is performed at 
a later date, FFP is available only for services furnished after the 
screening or review has been performed, subject to the provisions of 
paragraph (a) of this section.



Sec.  483.124  FFP for specialized services.

    FFP is not available for specialized services furnished to NF 
residents as NF services.



Sec.  483.126  Appropriate placement.

    Placement of an individual with MI or MR in a NF may be considered 
appropriate only when the individual's needs are such that he or she 
meets the minimum standards for admission and the individual's needs for 
treatment do not exceed the level of services which can be delivered in 
the NF to which the individual is admitted either through NF services 
alone or, where necessary, through NF services supplemented by 
specialized services provided by or arranged for by the State.



Sec.  483.128  PASARR evaluation criteria.

    (a) Level I: Identification of individuals with MI or MR. The 
State's PASARR program must identify all individuals who are suspected 
of having MI or MR as defined in Sec.  483.102. This identification 
function is termed Level I. Level II is the function of evaluating and 
determining whether NF services and specialized services are needed. The 
State's performance of the Level I identification function must provide 
at least, in the case of first time identifications, for the issuance of 
written notice to the individual or resident and his or her legal 
representative that the individual or resident is suspected of

[[Page 75]]

having MI or MR and is being referred to the State mental health or 
mental retardation authority for Level II screening.
    (b) Adaptation to culture, language, ethnic origin. Evaluations 
performed under PASARR and PASARR notices must be adapted to the 
cultural background, language, ethnic origin and means of communication 
used by the individual being evaluated.
    (c) Participation by individual and family. PASARR evaluations must 
involve--
    (1) The individual being evaluated;
    (2) The individual's legal representative, if one has been 
designated under State law; and
    (3) The individual's family if--
    (i) Available; and
    (ii) The individual or the legal representative agrees to family 
participation.
    (d) Interdisciplinary coordination. When parts of a PASARR 
evaluation are performed by more than one evaluator, the State must 
ensure that there is interdisciplinary coordination among the 
evaluators.
    (e) The State's PASARR program must use at least the evaluative 
criteria of Sec.  483.130 (if one or both determinations can easily be 
made categorically as described in Sec.  483.130) or of Sec. Sec.  
483.132 and 483.134 or Sec.  483.136 (or, in the case of individuals 
with both MI and MR, Sec. Sec.  483.132, 483.134 and 483.136 if a more 
extensive individualized evaluation is required).
    (f) Data. In the case of individualized evaluations, information 
that is necessary for determining whether it is appropriate for the 
individual with MI or MR to be placed in an NF or in another appropriate 
setting should be gathered throughout all applicable portions of the 
PASARR evaluation (Sec. Sec.  483.132 and 483.134 and/or Sec.  483.136). 
The two determinations relating to the need for NF level of care and 
specialized services are interrelated and must be based upon a 
comprehensive analysis of all data concerning the individual.
    (g) Preexisting data. Evaluators may use relevant evaluative data, 
obtained prior to initiation of preadmission screening or annual 
resident review, if the data are considered valid and accurate and 
reflect the current functional status of the individual. However, in the 
case of individualized evaluations, to supplement and verify the 
currency and accuracy of existing data, the State's PASARR program may 
need to gather additional information necessary to assess proper 
placement and treatment.
    (h) Findings. For both categorical and individualized 
determinations, findings of the evaluation must correspond to the 
person's current functional status as documented in medical and social 
history records.
    (i) Evaluation report: Individualized determinations. For 
individualized PASARR determinations, findings must be issued in the 
form of a written evaluative report which--
    (1) Identifies the name and professional title of person(s) who 
performed the evaluation(s) and the date on which each portion of the 
evaluation was administered;
    (2) Provides a summary of the medical and social history, including 
the positive traits or developmental strengths and weaknesses or 
developmental needs of the evaluated individual;
    (3) If NF services are recommended, identifies the specific services 
which are required to meet the evaluated individual's needs, including 
services required in paragraph (i)(5) of this section;
    (4) If specialized services are not recommended, identifies any 
specific mental retardation or mental health services which are of a 
lesser intensity than specialized services that are required to meet the 
evaluated individual's needs;
    (5) If specialized services are recommended, identifies the specific 
mental retardation or mental health services required to meet the 
evaluated individual's needs; and
    (6) Includes the bases for the report's conclusions.
    (j) Evaluation report: Categorical determinations. For categorical 
PASARR determinations, findings must be issued in the form of an 
abbreviated written evaluative report which--
    (1) Identifies the name and professional title of the person 
applying the

[[Page 76]]

categorical determination and the data on which the application was 
made;
    (2) Explains the categorical determination(s) that has (have) been 
made and, if only one of the two required determinations can be made 
categorically, describes the nature of any further screening which is 
required;
    (3) Identifies, to the extent possible, based on the available data, 
NF services, including any mental health or specialized psychiatric 
rehabilitative services, that may be needed; and
    (4) Includes the bases for the report's conclusions.
    (k) Interpretation of findings to individual. For both categorical 
and individualized determinations, findings of the evaluation must be 
interpreted and explained to the individual and, where applicable, to a 
legal representative designated under State law.
    (l) Evaluation report. The evaluator must send a copy of the 
evaluation report to the--
    (1) Individual or resident and his or her legal representative;
    (2) Appropriate State authority in sufficient time for the State 
authorities to meet the times identified in Sec.  483.112(c) for PASs 
and Sec.  483.114(c) for ARRs;
    (3) Admitting or retaining NF;
    (4) Individual's attending physician; and
    (5) The discharging hospital if the individual is seeking NF 
admission from a hospital.
    (m) The evaluation may be terminated if the evaluator finds at any 
time during the evaluation that the individual being evaluated--
    (1) Does not have MI or MR; or
    (2) Has--
    (i) A primary diagnosis of dementia (including Alzheimer's Disease 
or a related disorder); or
    (ii) A non-primary diagnosis of dementia without a primary diagnosis 
that is a serious mental illness, and does not have a diagnosis of MR or 
a related condition.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993]



Sec.  483.130  PASARR determination criteria.

    (a) Basis for determinations. Determinations made by the State 
mental health or mental retardation authority as to whether NF level of 
services and specialized services are needed must be based on an 
evaluation of data concerning the individual, as specified in paragraph 
(b) of this section.
    (b) Types of determinations. Determinations may be--
    (1) Advance group determinations, in accordance with this section, 
by category that take into account that certain diagnoses, levels of 
severity of illness, or need for a particular service clearly indicate 
that admission to or residence in a NF is normally needed, or that the 
provision of specialized services is not normally needed; or
    (2) Individualized determinations based on more extensive 
individualized evaluations as required in Sec.  483.132, Sec.  483.134, 
or Sec.  483.136 (or, in the case of an individual having both MR and 
MI, Sec. Sec.  483.134 and 483.136).
    (c) Group determinations by category. Advance group determinations 
by category developed by the State mental health or mental retardation 
authorities may be made applicable to individuals by the NF or other 
evaluator following Level I review only if existing data on the 
individual appear to be current and accurate and are sufficient to allow 
the evaluator readily to determine that the individual fits into the 
category established by the State authorities (see Sec.  483.132(c)). 
Sources of existing data on the individual that could form the basis for 
applying a categorical determination by the State authorities would be 
hospital records, physician's evaluations, election of hospice status, 
records of community mental health centers or community mental 
retardation or developmental disability providers.
    (d) Examples of categories. Examples of categories for which the 
State mental health or mental retardation authority may make an advance 
group determination that NF services are needed are--
    (1) Convalescent care from an acute physical illness which--
    (i) Required hospitalization; and
    (ii) Does not meet all the criteria for an exempt hospital 
discharge, which is not subject to preadmission screening, as specified 
in Sec.  483.106(b)(2).

[[Page 77]]

    (2) Terminal illness, as defined for hospice purposes in Sec.  418.3 
of this chapter;
    (3) Severe physical illnesses such as coma, ventilator dependence, 
functioning at a brain stem level, or diagnoses such as chronic 
obstructive pulmonary disease, Parkinson's disease, Huntington's 
disease, amyotrophic lateral sclerosis, and congestive heart failure 
which result in a level of impairment so severe that the individual 
could not be expected to benefit from specialized services;
    (4) Provisional admissions pending further assessment in cases of 
delirium where an accurate diagnosis cannot be made until the delirium 
clears;
    (5) Provisional admissions pending further assessment in emergency 
situations requiring protective services, with placement in a nursing 
facility not to exceed 7 days; and
    (6) Very brief and finite stays of up to a fixed number of days to 
provide respite to in-home caregivers to whom the individual with MI or 
MR is expected to return following the brief NF stay.
    (e) Time limits. The State may specify time limits for categorical 
determinations that NF services are needed and in the case of paragraphs 
(d)(4), (5) and (6) of this section, must specify a time limit which is 
appropriate for provisional admissions pending further assessment and 
for emergency situations and respite care. If an individual is later 
determined to need a longer stay than the State's limit allows, the 
individual must be subjected to an annual resident review before 
continuation of the stay may be permitted and payment made for days of 
NF care beyond the State's time limit.
    (f) The State mental health and mental retardation authorities may 
make categorical determinations that specialized services are not needed 
in the provisional, emergency and respite admission situations 
identified in Sec.  483.130(d)(4)-(6). In all other cases, except for 
Sec.  483.130(h), a determination that specialized services are not 
needed must be based on a more extensive individualized evaluation under 
Sec.  483.134 or Sec.  483.136.
    (g) Categorical determinations: No positive specialized treatment 
determinations. The State mental health and mental retardation 
authorities must not make categorical determinations that specialized 
services are needed. Such a determination must be based on a more 
extensive individualized evaluation under Sec.  483.134 or Sec.  483.136 
to determine the exact nature of the specialized services that are 
needed.
    (h) Categorical determinations: Dementia and MR. The State mental 
retardation authority may make categorical determinations that 
individuals with dementia, which exists in combination with mental 
retardation or a related condition, do not need specialized services.
    (i) If a State mental health or mental retardation authority 
determines NF needs by category, it may not waive the specialized 
services determination. The appropriate State authority must also 
determine whether specialized services are needed either by category (if 
permitted) or by individualized evaluations, as specified in Sec.  
483.134 or Sec.  483.136.
    (j) Recording determinations. All determinations made by the State 
mental health and mental retardation authority, regardless of how they 
are arrived at, must be recorded in the individual's record.
    (k) Notice of determination. The State mental health or mental 
retardation authority must notify in writing the following entities of a 
determination made under this subpart:
    (1) The evaluated individual and his or her legal representative;
    (2) The admitting or retaining NF;
    (3) The individual or resident's attending physician; and
    (4) The discharging hospital, unless the individual is exempt from 
preadmission screening as provided for at Sec.  483.106(b)(2).
    (l) Contents of notice. Each notice of the determination made by the 
State mental health or mental retardation authority must include--
    (1) Whether a NF level of services is needed;
    (2) Whether specialized services are needed;
    (3) The placement options that are available to the individual 
consistent with these determinations; and

[[Page 78]]

    (4) The rights of the individual to appeal the determination under 
subpart E of this part.
    (m) Placement options. Except as otherwise may be provided in an 
alternative disposition plan adopted under section 1919(e)(7)(E) of the 
Act, the placement options and the required State actions are as 
follows:
    (1) Can be admitted to a NF. Any applicant for admission to a NF who 
has MI or MR and who requires the level of services provided by a NF, 
regardless of whether specialized services are also needed, may be 
admitted to a NF, if the placement is appropriate, as determined in 
Sec.  483.126. If specialized services are also needed, the State is 
responsible for providing or arranging for the provision of the 
specialized services.
    (2) Cannot be admitted to a NF. Any applicant for admission to a NF 
who has MI or MR and who does not require the level of services provided 
by a NF, regardless of whether specialized services are also needed, is 
inappropriate for NF placement and must not be admitted.
    (3) Can be considered appropriate for continued placement in a NF. 
Any NF resident with MI or MR who requires the level of services 
provided by a NF, regardless of the length of his or her stay or the 
need for specialized services, can continue to reside in the NF, if the 
placement is appropriate, as determined in Sec.  483.126.
    (4) May choose to remain in the NF even though the placement would 
otherwise be inappropriate. Any NF resident with MI or MR who does not 
require the level of services provided by a NF but does require 
specialized services and who has continuously resided in a NF for at 
least 30 consecutive months before the date of determination may choose 
to continue to reside in the facility or to receive covered services in 
an alternative appropriate institutional or noninstitutional setting. 
Wherever the resident chooses to reside, the State must meet his or her 
specialized services needs. The determination notice must provide 
information concerning how, when, and by whom the various placement 
options available to the resident will be fully explained to the 
resident.
    (5) Cannot be considered appropriate for continued placement in a NF 
and must be discharged (short-term residents). Any NF resident with MI 
or MR who does not require the level of services provided by a NF but 
does require specialized services and who has resided in a NF for less 
than 30 consecutive months must be discharged in accordance with Sec.  
483.12(a) to an appropriate setting where the State must provide 
specialized services. The determination notice must provide information 
on how, when, and by whom the resident will be advised of discharge 
arrangements and of his/her appeal rights under both PASARR and 
discharge provisions.
    (6) Cannot be considered appropriate for continued placement in a NF 
and must be discharged (short or long-term residents). Any NF resident 
with MI or MR who does not require the level of services provided by a 
NF and does not require specialized services regardless of his or her 
length of stay, must be discharged in accordance with Sec.  483.12(a). 
The determination notice must provide information on how, when, and by 
whom the resident will be advised of discharge arrangements and of his 
or her appeal rights under both PASARR and discharge provisions.
    (n) Specialized services needed in a NF. If a determination is made 
to admit or allow to remain in a NF any individual who requires 
specialized services, the determination must be supported by assurances 
that the specialized services that are needed can and will be provided 
or arranged for by the State while the individual resides in the NF.
    (o) Record retention. The State PASARR system must maintain records 
of evaluations and determinations, regardless of whether they are 
performed categorically or individually, in order to support its 
determinations and actions and to protect the appeal rights of 
individuals subjected to PASARR; and
    (p) Tracking system. The State PASARR system must establish and 
maintain a tracking system for all individuals with MI or MR in NFs to 
ensure that appeals and future reviews are performed in accordance with 
this subpart and subpart E.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993]

[[Page 79]]



Sec.  483.132  Evaluating the need for NF services and NF level of care (PASARR/NF).

    (a) Basic rule. For each applicant for admission to a NF and each NF 
resident who has MI or MR, the evaluator must assess whether--
    (1) The individual's total needs are such that his or her needs can 
be met in an appropriate community setting;
    (2) The individual's total needs are such that they can be met only 
on an inpatient basis, which may include the option of placement in a 
home and community-based services waiver program, but for which the 
inpatient care would be required;
    (3) If inpatient care is appropriate and desired, the NF is an 
appropriate institutional setting for meeting those needs in accordance 
with Sec.  483.126; or
    (4) If the inpatient care is appropriate and desired but the NF is 
not the appropriate setting for meeting the individual's needs in 
accordance with Sec.  483.126, another setting such as an ICF/MR 
(including small, community-based facilities), an IMD providing services 
to individuals aged 65 or older, or a psychiatric hospital is an 
appropriate institutional setting for meeting those needs.
    (b) Determining appropriate placement. In determining appropriate 
placement, the evaluator must prioritize the physical and mental needs 
of the individual being evaluated, taking into account the severity of 
each condition.
    (c) Data. At a minimum, the data relied on to make a determination 
must include:
    (1) Evaluation of physical status (for example, diagnoses, date of 
onset, medical history, and prognosis);
    (2) Evaluation of mental status (for example, diagnoses, date of 
onset, medical history, likelihood that the individual may be a danger 
to himself/herself or others); and
    (3) Functional assessment (activities of daily living).
    (d) Based on the data compiled in Sec.  483.132 and, as appropriate, 
in Sec. Sec.  483.134 and 483.136, the State mental health or mental 
retardation authority must determine whether an NF level of services is 
needed.



Sec.  483.134  Evaluating whether an individual with mental illness requires specialized services (PASARR/MI).

    (a) Purpose. The purpose of this section is to identify the minimum 
data needs and process requirements for the State mental health 
authority, which is responsible for determining whether or not the 
applicant or resident with MI, as defined in Sec.  483.102(b)(1) of this 
part, needs a specialized services program for mental illness as defined 
in Sec.  483.120.
    (b) Data. Minimum data collected must include--(1) A comprehensive 
history and physical examination of the person. The following areas must 
be included (if not previously addressed):
    (i) Complete medical history;
    (ii) Review of all body systems;
    (iii) Specific evaluation of the person's neurological system in the 
areas of motor functioning, sensory functioning, gait, deep tendon 
reflexes, cranial nerves, and abnormal reflexes; and
    (iv) In case of abnormal findings which are the basis for an NF 
placement, additional evaluations conducted by appropriate specialists.
    (2) A comprehensive drug history including current or immediate past 
use of medications that could mask symptoms or mimic mental illness.
    (3) A psychosocial evaluation of the person, including current 
living arrangements and medical and support systems.
    (4) A comprehensive psychiatric evaluation including a complete 
psychiatric history, evaluation of intellectual functioning, memory 
functioning, and orientation, description of current attitudes and overt 
behaviors, affect, suicidal or homicidal ideation, paranoia, and degree 
of reality testing (presence and content of delusions) and 
hallucinations.
    (5) A functional assessment of the individual's ability to engage in 
activities of daily living and the level of support that would be needed 
to assist the individual to perform these activities while living in the 
community. The assessment must determine whether this level of support 
can be provided to the individual in an alternative community setting or 
whether the level of support needed is such that NF placement is 
required.

[[Page 80]]

    (6) The functional assessment must address the following areas: 
Self-monitoring of health status, self-administering and scheduling of 
medical treatment, including medication compliance, or both, self-
monitoring of nutritional status, handling money, dressing 
appropriately, and grooming.
    (c) Personnel requirements. (1) If the history and physical 
examination are not performed by a physician, then a physician must 
review and concur with the conclusions.
    (2) The State may designate the mental health professionals who are 
qualified--
    (i) To perform the evaluations required under paragraph (b) (2)-(6) 
of this section including the--
    (A) Comprehensive drug history;
    (B) Psychosocial evaluation;
    (C) Comprehensive psychiatric evaluation;
    (D) Functional assessment; and
    (ii) To make the determination required in paragraph (d) of this 
section.
    (d) Data interpretation. Based on the data compiled, a qualified 
mental health professional, as designated by the State, must validate 
the diagnosis of mental illness and determine whether a program of 
psychiatric specialized services is needed.



Sec.  483.136  Evaluating whether an individual with mental retardation requires specialized services (PASARR/MR).

    (a) Purpose. The purpose of this section is to identify the minimum 
data needs and process requirements for the State mental retardation 
authority to determine whether or not the applicant or resident with 
mental retardation, as defined in Sec.  483.102(b)(3) of this part, 
needs a continuous specialized services program, which is analogous to 
active treatment, as defined in Sec.  435.1010 of this chapter and Sec.  
483.440.
    (b) Data. Minimum data collected must include the individual's 
comprehensive history and physical examination results to identify the 
following information or, in the absence of data, must include 
information that permits a reviewer specifically to assess:
    (1) The individual's medical problems;
    (2) The level of impact these problems have on the individual's 
independent functioning;
    (3) All current medications used by the individual and the current 
response of the individual to any prescribed medications in the 
following drug groups:
    (i) Hypnotics,
    (ii) Antipsychotics (neuroleptics),
    (iii) Mood stabilizers and antidepressants,
    (iv) Antianxiety-sedative agents, and
    (v) Anti-Parkinson agents.
    (4) Self-monitoring of health status;
    (5) Self-administering and scheduling of medical treatments;
    (6) Self-monitoring of nutritional status;
    (7) Self-help development such as toileting, dressing, grooming, and 
eating;
    (8) Sensorimotor development, such as ambulation, positioning, 
transfer skills, gross motor dexterity, visual motor perception, fine 
motor dexterity, eye-hand coordination, and extent to which prosthetic, 
orthotic, corrective or mechanical supportive devices can improve the 
individual's functional capacity;
    (9) Speech and language (communication) development, such as 
expressive language (verbal and nonverbal), receptive language (verbal 
and nonverbal), extent to which non-oral communication systems can 
improve the individual's function capacity, auditory functioning, and 
extent to which amplification devices (for example, hearing aid) or a 
program of amplification can improve the individual's functional 
capacity;
    (10) Social development, such as interpersonal skills, recreation-
leisure skills, and relationships with others;
    (11) Academic/educational development, including functional learning 
skills;
    (12) Independent living development such as meal preparation, 
budgeting and personal finances, survival skills, mobility skills 
(orientation to the neighborhood, town, city), laundry, housekeeping, 
shopping, bedmaking, care of clothing, and orientation skills (for 
individuals with visual impairments);

[[Page 81]]

    (13) Vocational development, including present vocational skills;
    (14) Affective development such as interests, and skills involved 
with expressing emotions, making judgments, and making independent 
decisions; and
    (15) The presence of identifiable maladaptive or inappropriate 
behaviors of the individual based on systematic observation (including, 
but not limited to, the frequency and intensity of identified 
maladaptive or inappropriate behaviors).
    (c) Data interpretation--(1) The State must ensure that a licensed 
psychologist identifies the intellectual functioning measurement of 
individuals with MR or a related condition.
    (2) Based on the data compiled in paragraph (b) of this section, the 
State mental retardation authority, using appropriate personnel, as 
designated by the State, must validate that the individual has MR or is 
a person with a related condition and must determine whether specialized 
services for mental retardation are needed. In making this 
determination, the State mental retardation authority must make a 
qualitative judgment on the extent to which the person's status 
reflects, singly and collectively, the characteristics commonly 
associated with the need for specialized services, including--
    (i) Inability to--
    (A) Take care of the most personal care needs;
    (B) Understand simple commands;
    (C) Communicate basic needs and wants;
    (D) Be employed at a productive wage level without systematic long 
term supervision or support;
    (E) Learn new skills without aggressive and consistent training;
    (F) Apply skills learned in a training situation to other 
environments or settings without aggressive and consistent training;
    (G) Demonstrate behavior appropriate to the time, situation or place 
without direct supervision; and
    (H) Make decisions requiring informed consent without extreme 
difficulty;
    (ii) Demonstration of severe maladaptive behavior(s) that place the 
person or others in jeopardy to health and safety; and
    (iii) Presence of other skill deficits or specialized training needs 
that necessitate the availability of trained MR personnel, 24 hours per 
day, to teach the person functional skills.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993, as amended at 
71 FR 39229, July 12, 2006]



Sec.  483.138  Maintenance of services and availability of FFP.

    (a) Maintenance of services. If a NF mails a 30 day notice of its 
intent to transfer or discharge a resident, under Sec.  483.12(a) of 
this chapter, the agency may not terminate or reduce services until--
    (1) The expiration of the notice period; or
    (2) A subpart E appeal, if one has been filed, has been resolved.
    (b) Availability of FFP. FFP is available for expenditures for 
services provided to Medicaid recipients during--
    (1) The 30 day notice period specified in Sec.  483.12(a) of this 
chapter; or
    (2) During the period an appeal is in progress.



 Subpart D_Requirements That Must Be Met by States and State Agencies: 
    Nurse Aide Training and Competency Evaluation, and Paid Feeding 
                               Assistants

    Source: 56 FR 48919, Sept. 26, 1991, unless otherwise noted.



Sec.  483.150  Statutory basis; Deemed meeting or waiver of requirements.

    (a) Statutory basis. This subpart is based on sections 1819(b)(5) 
and 1919(b)(5) of the Act, which establish standards for training nurse-
aides and for evaluating their competency.
    (b) Deemed meeting of requirements. A nurse aide is deemed to 
satisfy the requirement of completing a training and competency 
evaluation approved by the State if he or she successfully completed a 
training and competency evaluation program before July 1, 1989 if--
    (1) The aide would have satisfied this requirement if--
    (i) At least 60 hours were substituted for 75 hours in sections 
1819(f)(2) and 1919(f)(2) of the Act, and

[[Page 82]]

    (ii) The individual has made up at least the difference in the 
number of hours in the program he or she completed and 75 hours in 
supervised practical nurse aide training or in regular in-service nurse 
aide education;

or
    (2) The individual was found to be competent (whether or not by the 
State) after the completion of nurse aide training of at least 100 hours 
duration.
    (c) Waiver of requirements. A State may--
    (1) Waive the requirement for an individual to complete a competency 
evaluation program approved by the State for any individual who can 
demonstrate to the satisfaction of the State that he or she has served 
as a nurse aide at one or more facilities of the same employer in the 
state for at least 24 consecutive months before December 19, 1989; or
    (2) Deem an individual to have completed a nurse aide training and 
competency evaluation program approved by the State if the individual 
completed, before July 1, 1989, such a program that the State determines 
would have met the requirements for approval at the time it was offered.

[56 FR 48919, Sept. 26, 1991; 56 FR 59331, Nov. 25, 1991, as amended at 
60 FR 50443, Sept. 29, 1995]



Sec.  483.151  State review and approval of nurse aide training and competency evaluation programs and competency evaluation programs.

    (a) State review and administration. (1) The State--
    (i) Must specify any nurse aide training and competency evaluation 
programs that the State approves as meeting the requirements of Sec.  
483.152 and/or competency evaluations programs that the State approves 
as meeting the requirements of Sec.  483.154; and
    (ii) May choose to offer a nurse aide training and competency 
evaluation program that meets the requirements of Sec.  483.152 and/or a 
competency evaluation program that meets the requirements of Sec.  
483.154.
    (2) If the State does not choose to offer a nurse aide training and 
competency evaluation program or competency evaluation program, the 
State must review and approve or disapprove nurse aide training and 
competency evaluation programs and nurse aide competency evaluation 
programs upon request.
    (3) The State survey agency must in the course of all surveys, 
determine whether the nurse aide training and competency evaluation 
requirements of Sec.  483.75(e) are met.
    (b) Requirements for approval of programs. (1) Before the State 
approves a nurse aide training and competency evaluation program or 
competency evaluation program, the State must--
    (i) Determine whether the nurse aide training and competency 
evaluation program meets the course requirements of Sec. Sec.  483.152:
    (ii) Determine whether the nurse aide competency evaluation program 
meets the requirements of Sec.  483.154; and
    (iii) In all reviews other than the initial review, visit the entity 
providing the program.
    (2) The State may not approve a nurse aide training and competency 
evaluation program or competency evaluation program offered by or in a 
facility which, in the previous two years--
    (i) In the case of a skilled nursing facility, has operated under a 
waiver under section 1819(b)(4)(C)(ii)(II) of the Act;
    (ii) In the case of a nursing facility, has operated under a waiver 
under section 1919(b)(4)(C)(ii) of the Act that was granted on the basis 
of a demonstration that the facility is unable to provide nursing care 
required under section 1919(b)(4)(C)(i) of the Act for a period in 
excess of 48 hours per week;
    (iii) Has been subject to an extended (or partial extended) survey 
under sections 1819(g)(2)(B)(i) or 1919(g)(2)(B)(i) of the Act;
    (iv) Has been assessed a civil money penalty described in section 
1819(h)(2)(B)(ii) of 1919(h)(2)(A)(ii) of the Act of not less than 
$5,000; or
    (v) Has been subject to a remedy described in sections 1819(h)(2)(B) 
(i) or (iii), 1819(h)(4), 1919(h)(1)(B)(i), or 1919(h)(2)(A) (i), (iii) 
or (iv) of the Act.
    (3) A State may not, until two years since the assessment of the 
penalty (or penalties) has elapsed, approve a nurse

[[Page 83]]

aide training and competency evaluation program or competency evaluation 
program offered by or in a facility that, within the two-year period 
beginning October 1, 1988--
    (i) Had its participation terminated under title XVIII of the Act or 
under the State plan under title XIX of the Act;
    (ii) Was subject to a denial of payment under title XVIII or title 
XIX;
    (iii) Was assessed a civil money penalty of not less than $5,000 for 
deficiencies in nursing facility standards;
    (iv) Operated under temporary management appointed to oversee the 
operation of the facility and to ensure the health and safety of its 
residents; or
    (v) Pursuant to State action, was closed or had its residents 
transferred.
    (c) Time frame for acting on a request for approval. The State must, 
within 90 days of the date of a request under paragraph (a)(3) of this 
section or receipt of additional information from the requester--
    (1) Advise the requester whether or not the program has been 
approved; or
    (2) Request additional information form the requesting entity.
    (d) Duration of approval. The State may not grant approval of a 
nurse aide training and competency evaluation program for a period 
longer than 2 years. A program must notify the State and the State must 
review that program when there are substantive changes made to that 
program within the 2-year period.
    (e) Withdrawal of approval. (1) The State must withdraw approval of 
a nurse aide training and competency evaluation program or nurse aide 
competency evaluation program offered by or in a facility described in 
paragraph (b)(2) of this section.
    (2) The State may withdraw approval of a nurse aide training and 
competency evaluation program or nurse aide competency evaluation 
program if the State determines that any of the applicable requirements 
of Sec. Sec.  483.152 or 483.154 are not met by the program.
    (3) The State must withdraw approval of a nurse aide training and 
competency evaluation program or a nurse aide competency evaluation 
program if the entity providing the program refuses to permit 
unannounced visits by the State.
    (4) If a State withdraws approval of a nurse aide training and 
competency evaluation program or competency evaluation program--
    (i) The State must notify the program in writing, indicating the 
reason(s) for withdrawal of approval of the program.
    (ii) Students who have started a training and competency evaluation 
program from which approval has been withdrawn must be allowed to 
complete the course.



Sec.  483.152  Requirements for approval of a nurse aide training and competency evaluation program.

    (a) For a nurse aide training and competency evaluation program to 
be approved by the State, it must, at a minimum--
    (1) Consist of no less than 75 clock hours of training;
    (2) Include at least the subjects specified in paragraph (b) of this 
section;
    (3) Include at least 16 hours of supervised practical training. 
Supervised practical training means training in a laboratory or other 
setting in which the trainee demonstrates knowledge while performing 
tasks on an individual under the direct supervision of a registered 
nurse or a licensed practical nurse;
    (4) Ensure that--
    (i) Students do not perform any services for which they have not 
trained and been found proficient by the instructor; and
    (ii) Students who are providing services to residents are under the 
general supervision of a licensed nurse or a registered nurse;
    (5) Meet the following requirements for instructors who train nurse 
aides;
    (i) The training of nurse aides must be performed by or under the 
general supervision of a registered nurse who possesses a minimum of 2 
years of nursing experience, at least 1 year of which must be in the 
provision of long term care facility services;
    (ii) Instructors must have completed a course in teaching adults or 
have experience in teaching adults or supervising nurse aides;

[[Page 84]]

    (iii) In a facility-based program, the training of nurse aides may 
be performed under the general supervision of the director of nursing 
for the facility who is prohibited from performing the actual training; 
and
    (iv) Other personnel from the health professions may supplement the 
instructor, including, but not limited to, registered nurses, licensed 
practical/vocational nurses, pharmacists, dietitians, social workers, 
sanitarians, fire safety experts, nursing home administrators, 
gerontologists, psychologists, physical and occupational therapists, 
activities specialists, speech/language/hearing therapists, and resident 
rights experts. Supplemental personnel must have at least 1 year of 
experience in their fields;
    (6) Contain competency evaluation procedures specified in Sec.  
483.154.
    (b) The curriculum of the nurse aide training program must include--
    (1) At least a total of 16 hours of training in the following areas 
prior to any direct contact with a resident:
    (i) Communication and interpersonal skills;
    (ii) Infection control;
    (iii) Safety/emergency procedures, including the Heimlich maneuver;
    (iv) Promoting residents' independence; and
    (v) Respecting residents' rights.
    (2) Basic nursing skills;
    (i) Taking and recording vital signs;
    (ii) Measuring and recording height and weight;
    (iii) Caring for the residents' environment;
    (iv) Recognizing abnormal changes in body functioning and the 
importance of reporting such changes to a supervisor; and
    (v) Caring for residents when death is imminent.
    (3) Personal care skills, including, but not limited to--
    (i) Bathing;
    (ii) Grooming, including mouth care;
    (iii) Dressing;
    (iv) Toileting;
    (v) Assisting with eating and hydration;
    (vi) Proper feeding techniques;
    (vii) Skin care; and
    (viii) Transfers, positioning, and turning.
    (4) Mental health and social service needs:
    (i) Modifying aide's behavior in response to residents' behavior;
    (ii) Awareness of developmental tasks associated with the aging 
process;
    (iii) How to respond to resident behavior;
    (iv) Allowing the resident to make personal choices, providing and 
reinforcing other behavior consistent with the resident's dignity; and
    (v) Using the resident's family as a source of emotional support.
    (5) Care of cognitively impaired residents:
    (i) Techniques for addressing the unique needs and behaviors of 
individual with dementia (Alzheimer's and others);
    (ii) Communicating with cognitively impaired residents;
    (iii) Understanding the behavior of cognitively impaired residents;
    (iv) Appropriate responses to the behavior of cognitively impaired 
residents; and
    (v) Methods of reducing the effects of cognitive impairments.
    (6) Basic restorative services:
    (i) Training the resident in self care according to the resident's 
abilities;
    (ii) Use of assistive devices in transferring, ambulation, eating, 
and dressing;
    (iii) Maintenance of range of motion;
    (iv) Proper turning and positioning in bed and chair;
    (v) Bowel and bladder training; and
    (vi) Care and use of prosthetic and orthotic devices.
    (7) Residents' Rights.
    (i) Providing privacy and maintenance of confidentiality;
    (ii) Promoting the residents' right to make personal choices to 
accommodate their needs;
    (iii) Giving assistance in resolving grievances and disputes;
    (iv) Providing needed assistance in getting to and participating in 
resident and family groups and other activities;
    (v) Maintaining care and security of residents' personal 
possessions;
    (vi) Promoting the resident's right to be free from abuse, 
mistreatment, and

[[Page 85]]

neglect and the need to report any instances of such treatment to 
appropriate facility staff;
    (vii) Avoiding the need for restraints in accordance with current 
professional standards.
    (c) Prohibition of charges. (1) No nurse aide who is employed by, or 
who has received an offer of employment from, a facility on the date on 
which the aide begins a nurse aide training and competency evaluation 
program may be charged for any portion of the program (including any 
fees for textbooks or other required course materials).
    (2) If an individual who is not employed, or does not have an offer 
to be employed, as a nurse aide becomes employed by, or receives an 
offer of employment from, a facility not later than 12 months after 
completing a nurse aide training and competency evaluation program, the 
State must provide for the reimbursement of costs incurred in completing 
the program on a pro rata basis during the period in which the 
individual is employed as a nurse aide.



Sec.  483.154  Nurse aide competency evaluation.

    (a) Notification to Individual. The State must advise in advance any 
individual who takes the competency evaluation that a record of the 
successful completion of the evaluation will be included in the State's 
nurse aid registry.
    (b) Content of the competency evaluation program--(1) Written or 
oral examinations. The competency evaluation must--
    (i) Allow an aide to choose between a written and an oral 
examination;
    (ii) Address each course requirement specified in Sec.  483.152(b);
    (iii) Be developed from a pool of test questions, only a portion of 
which is used in any one examination;
    (iv) Use a system that prevents disclosure of both the pool of 
questions and the individual competency evaluations; and
    (v) If oral, must be read from a prepared text in a neutral manner.
    (2) Demonstration of skills. The skills demonstration must consist 
of a demonstration of randomly selected items drawn from a pool 
consisting of the tasks generally performed by nurse aides. This pool of 
skills must include all of the personal care skills listed in Sec.  
483.152(b)(3).
    (c) Administration of the competency evaluation. (1) The competency 
examination must be administered and evaluated only by--
    (i) The State directly; or
    (ii) A State approved entity which is neither a skilled nursing 
facility that participates in Medicare nor a nursing facility that 
participates in Medicaid.
    (2) No nurse aide who is employed by, or who has received an offer 
of employment from, a facility on the date on which the aide begins a 
nurse aide competency evaluation program may be charged for any portion 
of the program.
    (3) If an individual who is not employed, or does not have an offer 
to be employed, as a nurse aide becomes employed by, or receives an 
offer of employment from, a facility not later than 12 months after 
completing a nurse aide competency evaluation program, the State must 
provide for the reimbursement of costs incurred in completing the 
program on a pro rata basis during the period in which the individual is 
employed as a nurse aide.
    (4) The skills demonstration part of the evaluation must be--
    (i) Performed in a facility or laboratory setting comparable to the 
setting in which the individual will function as a nurse aide; and
    (ii) Administered and evaluated by a registered nurse with at least 
one year's experience in providing care for the elderly or the 
chronically ill of any age.
    (d) Facility proctoring of the competency evaluation. (1) The 
competency evaluation may, at the nurse aide's option, be conducted at 
the facility in which the nurse aide is or will be employed unless the 
facility is described in Sec.  483.151(b)(2).
    (2) The State may permit the competency evaluation to be proctored 
by facility personnel if the State finds that the procedure adopted by 
the facility assures that the competency evaluation program--
    (i) Is secure from tampering;

[[Page 86]]

    (ii) Is standardized and scored by a testing, educational, or other 
organization approved by the State; and
    (iii) Requires no scoring by facility personnel.
    (3) The State must retract the right to proctor nurse aide 
competency evaluations from facilities in which the State finds any 
evidence of impropriety, including evidence of tampering by facility 
staff.
    (e) Successful completion of the competency evaluation program. (1) 
The State must establish a standard for satisfactory completion of the 
competency evaluation. To complete the competency evaluation 
successfully an individual must pass both the written or oral 
examination and the skills demonstration.
    (2) A record of successful completion of the competency evaluation 
must be included in the nurse aide registry provided in Sec.  483.156 
within 30 days of the date if the individual is found to be competent.
    (f) Unsuccessful completion of the competency evaluation program. 
(1) If the individual does not complete the evaluation satisfactorily, 
the individual must be advised--
    (i) Of the areas which he or she; did not pass; and
    (ii) That he or she has at least three opportunities to take the 
evaluation.
    (2) The State may impose a maximum upon the number of times an 
individual upon the number of times an individual may attempt to 
complete the competency evaluation successfully, but the maximum may be 
no less than three.



Sec.  483.156  Registry of nurse aides.

    (a) Establishment of registry. The State must establish and maintain 
a registry of nurse aides that meets the requirement of this section. 
The registry--
    (1) Must include as a minimum the information contained in paragraph 
(c) of this section:
    (2) Must be sufficiently accessible to meet the needs of the public 
and health care providers promptly;
    (3) May include home health aides who have successfully completed a 
home health aide competency evaluation program approved by the State if 
home health aides are differentiated from nurse aides; and
    (4) Must provide that any response to an inquiry that includes a 
finding of abuse, neglect, or misappropriation of property also include 
any statement disputing the finding made by the nurse aide, as provided 
under paragraph (c)(1)(ix) of this section.
    (b) Registry operation. (1) The State may contract the daily 
operation and maintenance of the registry to a non-State entity. 
However, the State must maintain accountability for overall operation of 
the registry and compliance with these regulations.
    (2) Only the State survey and certification agency may place on the 
registry findings of abuse, neglect, or misappropriation of property.
    (3) The State must determine which individuals who (i) have 
successfully completed a nurse aide training and competency evaluation 
program or nurse aide competency evaluation program; (ii) have been 
deemed as meeting these requirements; or (iii) have had these 
requirements waived by the State do not qualify to remain on the 
registry because they have performed no nursing or nursing-related 
services for a period of 24 consecutive months.
    (4) The State may not impose any charges related to registration on 
individuals listed in the registry.
    (5) The State must provide information on the registry promptly.
    (c) Registry Content. (1) The registry must contain at least the 
following information on each individual who has successfully completed 
a nurse aide training and competency evaluation program which meets the 
requirements of Sec.  483.152 or a competency evaluation which meets the 
requirements of Sec.  483.154 and has been found by the State to be 
competent to function as a nurse aide or who may function as a nurse 
aide because of meeting criteria in Sec.  483.150:
    (i) The individual's full name.
    (ii) Information necessary to identify each individual;
    (iii) The date the individual became eligible for placement in the 
registry through successfully completing a nurse aide training and 
competency evaluation program or competency

[[Page 87]]

evaluation program or by meeting the requirements of Sec.  483.150; and
    (iv) The following information on any finding by the State survey 
agency of abuse, neglect, or misappropriation of property by the 
individual:
    (A) Documentation of the State's investigation, including the nature 
of the allegation and the evidence that led the State to conclude that 
the allegation was valid;
    (B) The date of the hearing, if the individual chose to have one, 
and its outcome; and
    (C) A statement by the individual disputing the allegation, if he or 
she chooses to make one; and
    (D) This information must be included in the registry within 10 
working days of the finding and must remain in the registry permanently, 
unless the finding was made in error, the individual was found not 
guilty in a court of law, or the State is notified of the individual's 
death.
    (2) The registry must remove entries for individuals who have 
performed no nursing or nursing-related services for a period of 24 
consecutive months, unless the individual's registry entry includes 
documented findings of abuse, neglect, or misappropriation of property.
    (d) Disclosure of information. The State must--
    (1) Disclose all of the information in Sec.  483.156(c)(1) (iii) and 
(iv) to all requesters and may disclose additional information it deems 
necessary; and
    (2) Promptly provide individuals with all information contained in 
the registry on them when adverse findings are placed on the registry 
and upon request. Individuals on the registry must have sufficient 
opportunity to correct any misstatements or inaccuracies contained in 
the registry.

[56 FR 48919, Sept. 26, 1991; 56 FR 59331, Nov. 25, 1991]



Sec.  483.158  FFP for nurse aide training and competency evaluation.

    (a) State expenditures for nurse aide training and competency 
evaluation programs and competency evaluation programs are 
administrative costs. They are matched as indicated in Sec.  
433.15(b)(8) of this chapter.
    (b) FFP is available for State expenditures associated with nurse 
aide training and competency evaluation programs and competency 
evaluation programs only for--
    (1) Nurse aides employed by a facility;
    (2) Nurse aides who have an offer of employment from a facility;
    (3) Nurse aides who become employed by a facility not later than 12 
months after completing a nurse aide training and competency evaluation 
program or competency evaluation program; or
    (4) Nurse aides who receive an offer of employment from a facility 
not later than 12 months after completing a nurse aide training and 
competency evaluation program or competency evaluation program.



Sec.  483.160  Requirements for training of paid feeding assistants.

    (a) Minimum training course contents. A State-approved training 
course for paid feeding assistants must include, at a minimum, 8 hours 
of training in the following:
    (1) Feeding techniques.
    (2) Assistance with feeding and hydration.
    (3) Communication and interpersonal skills.
    (4) Appropriate responses to resident behavior.
    (5) Safety and emergency procedures, including the Heimlich 
maneuver.
    (6) Infection control.
    (7) Resident rights.
    (8) Recognizing changes in residents that are inconsistent with 
their normal behavior and the importance of reporting those changes to 
the supervisory nurse.
    (b) Maintenance of records. A facility must maintain a record of all 
individuals, used by the facility as feeding assistants, who have 
successfully completed the training course for paid feeding assistants.

[68 FR 55539, Sept. 26, 2003]

[[Page 88]]



 Subpart E_Appeals of Discharges, Transfers, and Preadmission Screening 
           and Annual Resident Review (PASARR) Determinations

    Source: 57 FR 56514, Nov. 30, 1992, unless otherwise noted.



Sec.  483.200  Statutory basis.

    This subpart is based on sections 1819(e)(3) and (f)(3) and 
1919(e)(3) and (f)(3) of the Act, which require States to make 
available, to individuals who are discharged or transferred from SNFs or 
NFs, an appeals process that complies with guidelines issued by the 
Secretary.

[60 FR 50443, Sept. 29, 1995]



Sec.  483.202  Definitions.

    For purposes of this subpart and subparts B and C--
    Discharge means movement from an entity that participates in 
Medicare as a skilled nursing facility, a Medicare certified distinct 
part, an entity that participates in Medicaid as a nursing facility, or 
a Medicaid certified distinct part to a noninstitutional setting when 
the discharging facility ceases to be legally responsible for the care 
of the resident.
    Individual means an individual or any legal representative of the 
individual.
    Resident means a resident of a SNF or NF or any legal representative 
of the resident.
    Transfer means movement from an entity that participates in Medicare 
as a skilled nursing facility, a Medicare certified distinct part, an 
entity that participates in Medicaid as a nursing facility or a Medicaid 
certified distinct part to another institutional setting when the legal 
responsibility for the care of the resident changes from the 
transferring facility to the receiving facility.



Sec.  483.204  Provision of a hearing and appeal system.

    (a) Each State must provide a system for:
    (1) A resident of a SNF or a NF to appeal a notice from the SNF or 
NF of intent to discharge or transfer the resident; and
    (2) An individual who has been adversely affected by any PASARR 
determination made by the State in the context of either a preadmission 
screening or an annual resident review under subpart C of part 483 to 
appeal that determination.
    (b) The State must provide an appeals system that meets the 
requirements of this subpart, Sec.  483.12 of this part, and part 431 
subpart E of this chapter.

[57 FR 56506, Nov. 30, 1992; 58 FR 25784, Apr. 28, 1993]



Sec.  483.206  Transfers, discharges and relocations subject to appeal.

    (a) ``Facility'' means a certified entity, either a Medicare SNF or 
a Medicaid NF (see Sec. Sec.  483.5 and 483.12(a)(1)).
    (b) A resident has appeal rights when he or she is transferred 
from--
    (1) A certified bed into a noncertified bed; and
    (2) A bed in a certified entity to a bed in an entity which is 
certified as a different provider.
    (c) A resident has no appeal rights when he or she is moved from one 
bed in the certified entity to another bed in the same certified entity.



 Subpart F_Requirements That Must be Met by States and State Agencies, 
                           Resident Assessment



Sec.  483.315  Specification of resident assessment instrument.

    (a) Statutory basis. Sections 1819(e)(5) and 1919(e)(5) of the Act 
require that a State specify the resident assessment instrument (RAI) to 
be used by long term care facilities in the State when conducting 
initial and periodic assessments of each resident's functional capacity, 
in accordance with Sec.  483.20.
    (b) State options in specifying an RAI. The RAI that the State 
specifies must be one of the following:
    (1) The instrument designated by CMS.
    (2) An alternate instrument specified by the State and approved by 
CMS, using the criteria specified in the State Operations Manual issued 
by CMS (CMS Pub. 7) which is available for purchase through the National 
Technical

[[Page 89]]

Information Service, 5285 Port Royal Rd., Springfield, VA 22151.
    (c) State requirements in specifying an RAI. (1) Within 30 days 
after CMS notifies the State of the CMS-designated RAI or changes to it, 
the State must do one of the following:
    (i) Specify the CMS-designated RAI.
    (ii) Notify CMS of its intent to specify an alternate instrument.
    (2) Within 60 days after receiving CMS approval of an alternate RAI, 
the State must specify the RAI for use by all long term care facilities 
participating in the Medicare and Medicaid programs.
    (3) After specifying an instrument, the State must provide periodic 
educational programs for facility staff to assist with implementation of 
the RAI.
    (4) A State must audit implementation of the RAI through the survey 
process.
    (5) A State must obtain approval from CMS before making any 
modifications to its RAI.
    (6) A State must adopt revisions to the RAI that are specified by 
CMS.
    (d) CMS-designated RAI. The CMS-designated RAI is published in the 
State Operations Manual issued by CMS (CMS Pub. 7), as updated 
periodically, and consists of the following:
    (1) The minimum data set (MDS) and common definitions.
    (2) Care area assessment (CAA) guidelines and care area triggers 
(CATs) that are necessary to accurately assess residents, established by 
CMS.
    (3) The quarterly review, based on a subset of the MDS specified by 
CMS.
    (4) The requirements for use of the RAI that appear at Sec.  483.20.
    (e) Minimum data set (MDS). The MDS includes assessment in the areas 
specified in Sec.  483.20(b)(i) through (xviii) of this chapter, and as 
defined in the RAI manual published in the State Operations Manual 
issued by CMS (CMS Pub. 100-07).
    (f) [Reserved]
    (g) Criteria for CMS approval of alternate instrument. To receive 
CMS approval, a State's alternate instrument must use the standardized 
format, organization, item labels and definitions, and instructions 
specified by CMS in the latest issuance of the State Operations Manual 
issued by CMS (CMS Pub. 7).
    (h) State MDS system and database requirements. As part of facility 
agency responsibilities, the State Survey Agency must:
    (1) Support and maintain the CMS State system and database.
    (2) Specify to a facility the method of transmission of data, and 
instruct the facility on this method.
    (3) Upon receipt of facility data from CMS, ensure that a facility 
resolves errors.
    (4) Analyze data and generate reports, as specified by CMS.
    (i) State identification of agency that receives RAI data. The State 
must identify the component agency that receives RAI data, and ensure 
that this agency restricts access to the data except for the following:
    (1) Reports that contain no resident-identifiable data.
    (2) Transmission of reports to CMS.
    (3) Transmission of data and reports to the State agency that 
conducts surveys to ensure compliance with Medicare and Medicaid 
participation requirements, for purposes related to this function.
    (4) Transmission of data and reports to the State Medicaid agency 
for purposes directly related to the administration of the State 
Medicaid plan.
    (5) Transmission of data and reports to other entities only when 
authorized as a routine use by CMS.
    (j) Resident-identifiable data. (1) The State may not release 
information that is resident-identifiable to the public.
    (2) The State may not release RAI data that is resident-identifiable 
except in accordance with a written agreement under which the recipient 
agrees to be bound by the restrictions described in paragraph (i) of 
this section.

[62 FR 67212, Dec. 23, 1997, as amended at 74 FR 40363, Aug. 11, 2009]

[[Page 90]]



    Subpart G_Condition of Participation for the Use of Restraint or 
  Seclusion in Psychiatric Residential Treatment Facilities Providing 
       Inpatient Psychiatric Services for Individuals Under Age 21

    Source: 66 FR 7161, Jan. 22, 2001, unless otherwise noted.



Sec.  483.350  Basis and scope.

    (a) Statutory basis. Sections 1905(a)(16) and (h) of the Act provide 
that inpatient psychiatric services for individuals under age 21 include 
only inpatient services that are provided in an institution (or distinct 
part thereof) that is a psychiatric hospital as defined in section 
1861(f) of the Act or in another inpatient setting that the Secretary 
has specified in regulations. Additionally, the Children's Health Act of 
2000 (Pub. L. 106-310) imposes procedural reporting and training 
requirements regarding the use of restraints and involuntary seclusion 
in facilities, specifically including facilities that provide inpatient 
psychiatric services for children under the age of 21 as defined by 
sections 1905(a)(16) and (h) of the Act.
    (b) Scope. This subpart imposes requirements regarding the use of 
restraint or seclusion in psychiatric residential treatment facilities, 
that are not hospitals, providing inpatient psychiatric services to 
individuals under age 21.



Sec.  483.352  Definitions.

    For purposes of this subpart, the following definitions apply:
    Drug used as a restraint means any drug that--
    (1) Is administered to manage a resident's behavior in a way that 
reduces the safety risk to the resident or others;
    (2) Has the temporary effect of restricting the resident's freedom 
of movement; and
    (3) Is not a standard treatment for the resident's medical or 
psychiatric condition.
    Emergency safety intervention means the use of restraint or 
seclusion as an immediate response to an emergency safety situation.
    Emergency safety situation means unanticipated resident behavior 
that places the resident or others at serious threat of violence or 
injury if no intervention occurs and that calls for an emergency safety 
intervention as defined in this section.
    Mechanical restraint means any device attached or adjacent to the 
resident's body that he or she cannot easily remove that restricts 
freedom of movement or normal access to his or her body.
    Minor means a minor as defined under State law and, for the purpose 
of this subpart, includes a resident who has been declared legally 
incompetent by the applicable State court.
    Personal restraint means the application of physical force without 
the use of any device, for the purposes of restraining the free movement 
of a resident's body. The term personal restraint does not include 
briefly holding without undue force a resident in order to calm or 
comfort him or her, or holding a resident's hand to safely escort a 
resident from one area to another.
    Psychiatric Residential Treatment Facility means a facility other 
than a hospital, that provides psychiatric services, as described in 
subpart D of part 441 of this chapter, to individuals under age 21, in 
an inpatient setting.
    Restraint means a ``personal restraint,'' ``mechanical restraint,'' 
or ``drug used as a restraint'' as defined in this section.
    Seclusion means the involuntary confinement of a resident alone in a 
room or an area from which the resident is physically prevented from 
leaving.
    Serious injury means any significant impairment of the physical 
condition of the resident as determined by qualified medical personnel. 
This includes, but is not limited to, burns, lacerations, bone 
fractures, substantial hematoma, and injuries to internal organs, 
whether self-inflicted or inflicted by someone else.
    Staff means those individuals with responsibility for managing a 
resident's health or participating in an emergency safety intervention 
and who are employed by the facility on a full-time, part-time, or 
contract basis.

[[Page 91]]

    Time out means the restriction of a resident for a period of time to 
a designated area from which the resident is not physically prevented 
from leaving, for the purpose of providing the resident an opportunity 
to regain self-control.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28116, May 22, 2001]



Sec.  483.354  General requirements for psychiatric residential treatment facilities.

    A psychiatric residential treatment facility must meet the 
requirements in Sec.  441.151 through Sec.  441.182 of this chapter.



Sec.  483.356  Protection of residents.

    (a) Restraint and seclusion policy for the protection of residents. 
(1) Each resident has the right to be free from restraint or seclusion, 
of any form, used as a means of coercion, discipline, convenience, or 
retaliation.
    (2) An order for restraint or seclusion must not be written as a 
standing order or on an as-needed basis.
    (3) Restraint or seclusion must not result in harm or injury to the 
resident and must be used only--
    (i) To ensure the safety of the resident or others during an 
emergency safety situation; and
    (ii) Until the emergency safety situation has ceased and the 
resident's safety and the safety of others can be ensured, even if the 
restraint or seclusion order has not expired.
    (4) Restraint and seclusion must not be used simultaneously.
    (b) Emergency safety intervention. An emergency safety intervention 
must be performed in a manner that is safe, proportionate, and 
appropriate to the severity of the behavior, and the resident's 
chronological and developmental age; size; gender; physical, medical, 
and psychiatric condition; and personal history (including any history 
of physical or sexual abuse).
    (c) Notification of facility policy. At admission, the facility 
must--
    (1) Inform both the incoming resident and, in the case of a minor, 
the resident's parent(s) or legal guardian(s) of the facility's policy 
regarding the use of restraint or seclusion during an emergency safety 
situation that may occur while the resident is in the program;
    (2) Communicate its restraint and seclusion policy in a language 
that the resident, or his or her parent(s) or legal guardian(s) 
understands (including American Sign Language, if appropriate) and when 
necessary, the facility must provide interpreters or translators;
    (3) Obtain an acknowledgment, in writing, from the resident, or in 
the case of a minor, from the parent(s) or legal guardian(s) that he or 
she has been informed of the facility's policy on the use of restraint 
or seclusion during an emergency safety situation. Staff must file this 
acknowledgment in the resident's record; and
    (4) Provide a copy of the facility policy to the resident and in the 
case of a minor, to the resident's parent(s) or legal guardian(s).
    (d) Contact information. The facility's policy must provide contact 
information, including the phone number and mailing address, for the 
appropriate State Protection and Advocacy organization.



Sec.  483.358  Orders for the use of restraint or seclusion.

    (a) Orders for restraint or seclusion must be by a physician, or 
other licensed practitioner permitted by the State and the facility to 
order restraint or seclusion and trained in the use of emergency safety 
interventions. Federal regulations at 42 CFR 441.151 require that 
inpatient psychiatric services for recipients under age 21 be provided 
under the direction of a physician.
    (b) If the resident's treatment team physician is available, only he 
or she can order restraint or seclusion.
    (c) A physician or other licensed practitioner permitted by the 
state and the facility to order restraint or seclusion must order the 
least restrictive emergency safety intervention that is most likely to 
be effective in resolving the emergency safety situation based on 
consultation with staff.
    (d) If the order for restraint or seclusion is verbal, the verbal 
order must be received by a registered nurse or other licensed staff 
such as a licensed practical nurse, while the emergency safety

[[Page 92]]

intervention is being initiated by staff or immediately after the 
emergency safety situation ends. The physician or other licensed 
practitioner permitted by the state and the facility to order restraint 
or seclusion must verify the verbal order in a signed written form in 
the resident's record. The physician or other licensed practitioner 
permitted by the state and the facility to order restraint or seclusion 
must be available to staff for consultation, at least by telephone, 
throughout the period of the emergency safety intervention.
    (e) Each order for restraint or seclusion must:
    (1) Be limited to no longer than the duration of the emergency 
safety situation; and
    (2) Under no circumstances exceed 4 hours for residents ages 18 to 
21; 2 hours for residents ages 9 to 17; or 1 hour for residents under 
age 9.
    (f) Within 1 hour of the initiation of the emergency safety 
intervention a physician, or other licensed practitioner trained in the 
use of emergency safety interventions and permitted by the state and the 
facility to assess the physical and psychological well being of 
residents, must conduct a face-to-face assessment of the physical and 
psychological well being of the resident, including but not limited to--
    (1) The resident's physical and psychological status;
    (2) The resident's behavior;
    (3) The appropriateness of the intervention measures; and
    (4) Any complications resulting from the intervention.
    (g) Each order for restraint or seclusion must include--
    (1) The name of the ordering physician or other licensed 
practitioner permitted by the state and the facility to order restraint 
or seclusion;
    (2) The date and time the order was obtained; and
    (3) The emergency safety intervention ordered, including the length 
of time for which the physician or other licensed practitioner permitted 
by the state and the facility to order restraint or seclusion authorized 
its use.
    (h) Staff must document the intervention in the resident's record. 
That documentation must be completed by the end of the shift in which 
the intervention occurs. If the intervention does not end during the 
shift in which it began, documentation must be completed during the 
shift in which it ends. Documentation must include all of the following:
    (1) Each order for restraint or seclusion as required in paragraph 
(g) of this section.
    (2) The time the emergency safety intervention actually began and 
ended.
    (3) The time and results of the 1-hour assessment required in 
paragraph (f) of this section.
    (4) The emergency safety situation that required the resident to be 
restrained or put in seclusion.
    (5) The name of staff involved in the emergency safety intervention.
    (i) The facility must maintain a record of each emergency safety 
situation, the interventions used, and their outcomes.
    (j) The physician or other licensed practitioner permitted by the 
state and the facility to order restraint or seclusion must sign the 
restraint or seclusion order in the resident's record as soon as 
possible.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28116, May 22, 2001]



Sec.  483.360  Consultation with treatment team physician.

    If a physician or other licensed practitioner permitted by the state 
and the facility to order restraint or seclusion orders the use of 
restraint or seclusion, that person must contact the resident's 
treatment team physician, unless the ordering physician is in fact the 
resident's treatment team physician. The person ordering the use of 
restraint or seclusion must--
    (a) Consult with the resident's treatment team physician as soon as 
possible and inform the team physician of the emergency safety situation 
that required the resident to be restrained or placed in seclusion; and
    (b) Document in the resident's record the date and time the team 
physician was consulted.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28117, May 22, 2001]

[[Page 93]]



Sec.  483.362  Monitoring of the resident in and immediately after restraint.

    (a) Clinical staff trained in the use of emergency safety 
interventions must be physically present, continually assessing and 
monitoring the physical and psychological well-being of the resident and 
the safe use of restraint throughout the duration of the emergency 
safety intervention.
    (b) If the emergency safety situation continues beyond the time 
limit of the order for the use of restraint, a registered nurse or other 
licensed staff, such as a licensed practical nurse, must immediately 
contact the ordering physician or other licensed practitioner permitted 
by the state and the facility to order restraint or seclusion to receive 
further instructions.
    (c) A physician, or other licensed practitioner permitted by the 
state and the facility to evaluate the resident's well-being and trained 
in the use of emergency safety interventions, must evaluate the 
resident's well-being immediately after the restraint is removed.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28117, May 22, 2001]



Sec.  483.364  Monitoring of the resident in and immediately after seclusion.

    (a) Clinical staff, trained in the use of emergency safety 
interventions, must be physically present in or immediately outside the 
seclusion room, continually assessing, monitoring, and evaluating the 
physical and psychological well-being of the resident in seclusion. 
Video monitoring does not meet this requirement.
    (b) A room used for seclusion must--
    (1) Allow staff full view of the resident in all areas of the room; 
and
    (2) Be free of potentially hazardous conditions such as unprotected 
light fixtures and electrical outlets.
    (c) If the emergency safety situation continues beyond the time 
limit of the order for the use of seclusion, a registered nurse or other 
licensed staff, such as a licensed practical nurse, must immediately 
contact the ordering physician or other licensed practitioner permitted 
by the state and the facility to order restraint or seclusion to receive 
further instructions.
    (d) A physician, or other licensed practitioner permitted by the 
state and the facility to evaluate the resident's well-being and trained 
in the use of emergency safety interventions, must evaluate the 
resident's well-being immediately after the resident is removed from 
seclusion.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28117, May 22, 2001]



Sec.  483.366  Notification of parent(s) or legal guardian(s).

    If the resident is a minor as defined in this subpart:
    (a) The facility must notify the parent(s) or legal guardian(s) of 
the resident who has been restrained or placed in seclusion as soon as 
possible after the initiation of each emergency safety intervention.
    (b) The facility must document in the resident's record that the 
parent(s) or legal guardian(s) has been notified of the emergency safety 
intervention, including the date and time of notification and the name 
of the staff person providing the notification.



Sec.  483.368  Application of time out.

    (a) A resident in time out must never be physically prevented from 
leaving the time out area.
    (b) Time out may take place away from the area of activity or from 
other residents, such as in the resident's room (exclusionary), or in 
the area of activity or other residents (inclusionary).
    (c) Staff must monitor the resident while he or she is in time out.



Sec.  483.370  Postintervention debriefings.

    (a) Within 24 hours after the use of restraint or seclusion, staff 
involved in an emergency safety intervention and the resident must have 
a face-to-face discussion. This discussion must include all staff 
involved in the intervention except when the presence of a particular 
staff person may jeopardize the well-being of the resident. Other staff 
and the resident's parent(s) or legal guardian(s) may participate in the 
disussion when it is deemed appropriate by the facility. The facility 
must conduct such discussion in a language that is understood by the 
resident's parent(s) or legal guardian(s).

[[Page 94]]

The discussion must provide both the resident and staff the opportunity 
to discuss the circumstances resulting in the use of restraint or 
seclusion and strategies to be used by the staff, the resident, or 
others that could prevent the future use of restraint or seclusion.
    (b) Within 24 hours after the use of restraint or seclusion, all 
staff involved in the emergency safety intervention, and appropriate 
supervisory and administrative staff, must conduct a debriefing session 
that includes, at a minimum, a review and discussion of--
    (1) The emergency safety situation that required the intervention, 
including a discussion of the precipitating factors that led up to the 
intervention;
    (2) Alternative techniques that might have prevented the use of the 
restraint or seclusion;
    (3) The procedures, if any, that staff are to implement to prevent 
any recurrence of the use of restraint or seclusion; and
    (4) The outcome of the intervention, including any injuries that may 
have resulted from the use of restraint or seclusion.
    (c) Staff must document in the resident's record that both 
debriefing sessions took place and must include in that documentation 
the names of staff who were present for the debriefing, names of staff 
that were excused from the debriefing, and any changes to the resident's 
treatment plan that result from the debriefings.



Sec.  483.372  Medical treatment for injuries resulting from an emergency safety intervention.

    (a) Staff must immediately obtain medical treatment from qualified 
medical personnel for a resident injured as a result of an emergency 
safety intervention.
    (b) The psychiatric residential treatment facility must have 
affiliations or written transfer agreements in effect with one or more 
hospitals approved for participation under the Medicaid program that 
reasonably ensure that--
    (1) A resident will be transferred from the facility to a hospital 
and admitted in a timely manner when a transfer is medically necessary 
for medical care or acute psychiatric care;
    (2) Medical and other information needed for care of the resident in 
light of such a transfer, will be exchanged between the institutions in 
accordance with State medical privacy law, including any information 
needed to determine whether the appropriate care can be provided in a 
less restrictive setting; and
    (3) Services are available to each resident 24 hours a day, 7 days a 
week.
    (c) Staff must document in the resident's record, all injuries that 
occur as a result of an emergency safety intervention, including 
injuries to staff resulting from that intervention.
    (d) Staff involved in an emergency safety intervention that results 
in an injury to a resident or staff must meet with supervisory staff and 
evaluate the circumstances that caused the injury and develop a plan to 
prevent future injuries.



Sec.  483.374  Facility reporting.

    (a) Attestation of facility compliance. Each psychiatric residential 
treatment facility that provides inpatient psychiatric services to 
individuals under age 21 must attest, in writing, that the facility is 
in compliance with CMS's standards governing the use of restraint and 
seclusion. This attestation must be signed by the facility director.
    (1) A facility with a current provider agreement with the Medicaid 
agency must provide its attestation to the State Medicaid agency by July 
21, 2001.
    (2) A facility enrolling as a Medicaid provider must meet this 
requirement at the time it executes a provider agreement with the 
Medicaid agency.
    (b) Reporting of serious occurrences. The facility must report each 
serious occurrence to both the State Medicaid agency and, unless 
prohibited by State law, the State-designated Protection and Advocacy 
system. Serious occurrences that must be reported include a resident's 
death, a serious injury to a resident as defined in Sec.  483.352 of 
this part, and a resident's suicide attempt.
    (1) Staff must report any serious occurrence involving a resident to 
both the State Medicaid agency and the State-designated Protection and 
Advocacy system by no later than close of business the next business day 
after a

[[Page 95]]

serious occurrence. The report must include the name of the resident 
involved in the serious occurrence, a description of the occurrence, and 
the name, street address, and telephone number of the facility.
    (2) In the case of a minor, the facility must notify the resident's 
parent(s) or legal guardian(s) as soon as possible, and in no case later 
than 24 hours after the serious occurrence.
    (3) Staff must document in the resident's record that the serious 
occurrence was reported to both the State Medicaid agency and the State-
designated Protection and Advocacy system, including the name of the 
person to whom the incident was reported. A copy of the report must be 
maintained in the resident's record, as well as in the incident and 
accident report logs kept by the facility.
    (c) Reporting of deaths. In addition to the reporting requirements 
contained in paragraph (b) of this section, facilities must report the 
death of any resident to the Centers for Medicare & Medicaid Services 
(CMS) regional office.
    (1) Staff must report the death of any resident to the CMS regional 
office by no later than close of business the next business day after 
the resident's death.
    (2) Staff must document in the resident's record that the death was 
reported to the CMS regional office.

[66 FR 7161, Jan. 22, 2001, as amended at 66 FR 28117, May 22, 2001]



Sec.  483.376  Education and training.

    (a) The facility must require staff to have ongoing education, 
training, and demonstrated knowledge of--
    (1) Techniques to identify staff and resident behaviors, events, and 
environmental factors that may trigger emergency safety situations;
    (2) The use of nonphysical intervention skills, such as de-
escalation, mediation conflict resolution, active listening, and verbal 
and observational methods, to prevent emergency safety situations; and
    (3) The safe use of restraint and the safe use of seclusion, 
including the ability to recognize and respond to signs of physical 
distress in residents who are restrained or in seclusion.
    (b) Certification in the use of cardiopulmonary resuscitation, 
including periodic recertification, is required.
    (c) Individuals who are qualified by education, training, and 
experience must provide staff training.
    (d) Staff training must include training exercises in which staff 
members successfully demonstrate in practice the techniques they have 
learned for managing emergency safety situations.
    (e) Staff must be trained and demonstrate competency before 
participating in an emergency safety intervention.
    (f) Staff must demonstrate their competencies as specified in 
paragraph (a) of this section on a semiannual basis and their 
competencies as specified in paragraph (b) of this section on an annual 
basis.
    (g) The facility must document in the staff personnel records that 
the training and demonstration of competency were successfully 
completed. Documentation must include the date training was completed 
and the name of persons certifying the completion of training.
    (h) All training programs and materials used by the facility must be 
available for review by CMS, the State Medicaid agency, and the State 
survey agency.

Subpart H [Reserved]



 Subpart I_Conditions of Participation for Intermediate Care Facilities 
                        for the Mentally Retarded

    Source: 53 FR 20496, June 3, 1988, unless otherwise noted. 
Redesignated at 56 FR 48918, Sept. 26, 1991.



Sec.  483.400  Basis and purpose.

    This subpart implements section 1905 (c) and (d) of the Act which 
gives the Secretary authority to prescribe regulations for intermediate 
care facility services in facilities for the mentally retarded or 
persons with related conditions.

[[Page 96]]



Sec.  483.405  Relationship to other HHS regulations.

    In addition to compliance with the regulations set forth in this 
subpart, facilities are obliged to meet the applicable provisions of 
other HHS regulations, including but not limited to those pertaining to 
nondiscrimination on the basis of race, color, or national origin (45 
CFR Part 80), nondiscrimination on the basis of handicap (45 CFR Part 
84), nondiscrimination on the basis of age (45 CFR Part 91), protection 
of human subjects of research (45 CFR Part 46), and fraud and abuse (42 
CFR Part 455). Although those regulations are not in themselves 
considered conditions of participation under this Part, their violation 
may result in the termination or suspension of, or the refusal to grant 
or continue, Federal financial assistance.



Sec.  483.410  Condition of participation: Governing body and management.

    (a) Standard: Governing body. The facility must identify an 
individual or individuals to constitute the governing body of the 
facility. The governing body must--
    (1) Exercise general policy, budget, and operating direction over 
the facility;
    (2) Set the qualifications (in addition to those already set by 
State law, if any) for the administrator of the facility; and
    (3) Appoint the administrator of the facility.
    (b) Standard: Compliance with Federal, State, and local laws. The 
facility must be in compliance with all applicable provisions of 
Federal, State and local laws, regulations and codes pertaining to 
health, safety, and sanitation.
    (c) Standard: Client records. (1) The facility must develop and 
maintain a recordkeeping system that includes a separate record for each 
client and that documents the client's health care, active treatment, 
social information, and protection of the client's rights.
    (2) The facility must keep confidential all information contained in 
the clients' records, regardless of the form or storage method of the 
records.
    (3) The facility must develop and implement policies and procedures 
governing the release of any client information, including consents 
necessary from the client, or parents (if the client is a minor) or 
legal guardian.
    (4) Any individual who makes an entry in a client's record must make 
it legibly, date it, and sign it.
    (5) The facility must provide a legend to explain any symbol or 
abbreviation used in a client's record.
    (6) The facility must provide each identified residential living 
unit with appropriate aspects of each client's record.
    (d) Standard: Services provided under agreements with outside 
sources. (1) If a service required under this subpart is not provided 
directly, the facility must have a written agreement with an outside 
program, resource, or service to furnish the necessary service, 
including emergency and other health care.
    (2) The agreement must--
    (i) Contain the responsibilities, functions, objectives, and other 
terms agreed to by both parties; and
    (ii) Provide that the facility is responsible for assuring that the 
outside services meet the standards for quality of services contained in 
this subpart.
    (3) The facility must assure that outside services meet the needs of 
each client.
    (4) If living quarters are not provided in a facility owned by the 
ICF/MR, the ICF/MR remains directly responsible for the standards 
relating to physical environment that are specified in Sec.  483.470 (a) 
through (g), (j) and (k).
    (e) Standard: Licensure. The facility must be licensed under 
applicable State and local law.

[53 FR 20496, June 3, 1988. Redesignated at 56 FR 48918, Sept. 26, 1991, 
and amended at 57 FR 43925, Sept. 23, 1992]



Sec.  483.420  Condition of participation: Client protections.

    (a) Standard: Protection of clients' rights. The facility must 
ensure the rights of all clients. Therefore, the facility must--
    (1) Inform each client, parent (if the client is a minor), or legal 
guardian, of the client's rights and the rules of the facility;
    (2) Inform each client, parent (if the client is a minor), or legal 
guardian, of

[[Page 97]]

the client's medical condition, developmental and behavioral status, 
attendant risks of treatment, and of the right to refuse treatment;
    (3) Allow and encourage individual clients to exercise their rights 
as clients of the facility, and as citizens of the United States, 
including the right to file complaints, and the right to due process;
    (4) Allow individual clients to manage their financial affairs and 
teach them to do so to the extent of their capabilities;
    (5) Ensure that clients are not subjected to physical, verbal, 
sexual or psychological abuse or punishment;
    (6) Ensure that clients are free from unnecessary drugs and physical 
restraints and are provided active treatment to reduce dependency on 
drugs and physical restraints;
    (7) Provide each client with the opportunity for personal privacy 
and ensure privacy during treatment and care of personal needs;
    (8) Ensure that clients are not compelled to perform services for 
the facility and ensure that clients who do work for the facility are 
compensated for their efforts at prevailing wages and commensurate with 
their abilities;
    (9) Ensure clients the opportunity to communicate, associate and 
meet privately with individuals of their choice, and to send and receive 
unopened mail;
    (10) Ensure that clients have access to telephones with privacy for 
incoming and outgoing local and long distance calls except as 
contraindicated by factors identified within their individual program 
plans;
    (11) Ensure clients the opportunity to participate in social, 
religious, and community group activities;
    (12) Ensure that clients have the right to retain and use 
appropriate personal possessions and clothing, and ensure that each 
client is dressed in his or her own clothing each day; and
    (13) Permit a husband and wife who both reside in the facility to 
share a room.
    (b) Standard: Client finances. (1) The facility must establish and 
maintain a system that--
    (i) Assures a full and complete accounting of clients' personal 
funds entrusted to the facility on behalf of clients; and
    (ii) Precludes any commingling of client funds with facility funds 
or with the funds of any person other than another client.
    (2) The client's financial record must be available on request to 
the client, parents (if the client is a minor) or legal guardian.
    (c) Standard: Communication with clients, parents, and guardians. 
The facility must--
    (1) Promote participation of parents (if the client is a minor) and 
legal guardians in the process of providing active treatment to a client 
unless their participation is unobtainable or inappropriate;
    (2) Answer communications from clients' families and friends 
promptly and appropriately;
    (3) Promote visits by individuals with a relationship to the client 
(such as family, close friends, legal guardians and advocates) at any 
reasonable hour, without prior notice, consistent with the right of that 
client's and other clients' privacy, unless the interdisciplinary team 
determines that the visit would not be appropriate;
    (4) Promote visits by parents or guardians to any area of the 
facility that provides direct client care services to the client, 
consistent with the right of that client's and other clients' privacy;
    (5) Promote frequent and informal leaves from the facility for 
visits, trips, or vacations; and
    (6) Notify promptly the client's parents or guardian of any 
significant incidents, or changes in the client's condition including, 
but not limited to, serious illness, accident, death, abuse, or 
unauthorized absence.
    (d) Standard: Staff treatment of clients. (1) The facility must 
develop and implement written policies and procedures that prohibit 
mistreatment, neglect or abuse of the client.
    (i) Staff of the facility must not use physical, verbal, sexual or 
psychological abuse or punishment.
    (ii) Staff must not punish a client by withholding food or hydration 
that contributes to a nutritionally adequate diet.

[[Page 98]]

    (iii) The facility must prohibit the employment of individuals with 
a conviction or prior employment history of child or client abuse, 
neglect or mistreatment.
    (2) The facility must ensure that all allegations of mistreatment, 
neglect or abuse, as well as injuries of unknown source, are reported 
immediately to the administrator or to other officials in accordance 
with State law through established procedures.
    (3) The facility must have evidence that all alleged violations are 
thoroughly investigated and must prevent further potential abuse while 
the investigation is in progress.
    (4) The results of all investigations must be reported to the 
administrator or designated representative or to other officials in 
accordance with State law within five working days of the incident and, 
if the alleged violation is verified, appropriate corrective action must 
be taken.



Sec.  483.430  Condition of participation: Facility staffing.

    (a) Standard: Qualified mental retardation professional. Each 
client's active treatment program must be integrated, coordinated and 
monitored by a qualified mental retardation professional who--
    (1) Has at least one year of experience working directly with 
persons with mental retardation or other developmental disabilities; and
    (2) Is one of the following:
    (i) A doctor of medicine or osteopathy.
    (ii) A registered nurse.
    (iii) An individual who holds at least a bachelor's degree in a 
professional category specified in paragraph (b)(5) of this section.
    (b) Standard: Professional program services. (1) Each client must 
receive the professional program services needed to implement the active 
treatment program defined by each client's individual program plan. 
Professional program staff must work directly with clients and with 
paraprofessional, nonprofessional and other professional program staff 
who work with clients.
    (2) The facility must have available enough qualified professional 
staff to carry out and monitor the various professional interventions in 
accordance with the stated goals and objectives of every individual 
program plan.
    (3) Professional program staff must participate as members of the 
interdisciplinary team in relevant aspects of the active treatment 
process.
    (4) Professional program staff must participate in on-going staff 
development and training in both formal and informal settings with other 
professional, paraprofessional, and nonprofessional staff members.
    (5) Professional program staff must be licensed, certified, or 
registered, as applicable, to provide professional services by the State 
in which he or she practices. Those professional program staff who do 
not fall under the jurisdiction of State licensure, certification, or 
registration requirements, specified in Sec.  483.410(b), must meet the 
following qualifications:
    (i) To be designated as an occupational therapist, an individual 
must be eligible for certification as an occupational therapist by the 
American Occupational Therapy Association or another comparable body.
    (ii) To be designated as an occupational therapy assistant, an 
individual must be eligible for certification as a certified 
occupational therapy assistant by the American Occupational Therapy 
Association or another comparable body.
    (iii) To be designated as a physical therapist, an individual must 
be eligible for certification as a physical therapist by the American 
Physical Therapy Association or another comparable body.
    (iv) To be designated as a physical therapy assistant, an individual 
must be eligible for registration by the American Physical Therapy 
Association or be a graduate of a two year college-level program 
approved by the American Physical Therapy Association or another 
comparable body.
    (v) To be designated as a psychologist, an individual must have at 
least a master's degree in psychology from an accredited school.
    (vi) To be designated as a social worker, an individual must--
    (A) Hold a graduate degree from a school of social work accredited 
or approved by the Council on Social Work

[[Page 99]]

Education or another comparable body; or
    (B) Hold a Bachelor of Social Work degree from a college or 
university accredited or approved by the Council on Social Work 
Education or another comparable body.
    (vii) To be designated as a speech-language pathologist or 
audiologist, an individual must--
    (A) Be eligible for a Certificate of Clinical Competence in Speech-
Language Pathology or Audiology granted by the American Speech-Language-
Hearing Association or another comparable body; or
    (B) Meet the educational requirements for certification and be in 
the process of accumulating the supervised experience required for 
certification.
    (viii) To be designated as a professional recreation staff member, 
an individual must have a bachelor's degree in recreation or in a 
specialty area such as art, dance, music or physical education.
    (ix) To be designated as a professional dietitian, an individual 
must be eligible for registration by the American Dietetics Association.
    (x) To be designated as a human services professional an individual 
must have at least a bachelor's degree in a human services field 
(including, but not limited to: sociology, special education, 
rehabilitation counseling, and psychology).
    (xi) If the client's individual program plan is being successfully 
implemented by facility staff, professional program staff meeting the 
qualifications of paragraph (b)(5) (i) through (x) of this section are 
not required--
    (A) Except for qualified mental retardation professionals;
    (B) Except for the requirements of paragraph (b)(2) of this section 
concerning the facility's provision of enough qualified professional 
program staff; and
    (C) Unless otherwise specified by State licensure and certification 
requirements.
    (c) Standard: Facility staffing. (1) The facility must not depend 
upon clients or volunteers to perform direct care services for the 
facility.
    (2) There must be responsible direct care staff on duty and awake on 
a 24-hour basis, when clients are present, to take prompt, appropriate 
action in case of injury, illness, fire or other emergency, in each 
defined residential living unit housing--
    (i) Clients for whom a physician has ordered a medical care plan;
    (ii) Clients who are aggressive, assaultive or security risks;
    (iii) More than 16 clients; or
    (iv) Fewer than 16 clients within a multi-unit building.
    (3) There must be a responsible direct care staff person on duty on 
a 24 hour basis (when clients are present) to respond to injuries and 
symptoms of illness, and to handle emergencies, in each defined 
residential living unit housing--
    (i) Clients for whom a physician has not ordered a medical care 
plan;
    (ii) Clients who are not aggressive, assaultive or security risks; 
and
    (iii) Sixteen or fewer clients,
    (4) The facility must provide sufficient support staff so that 
direct care staff are not required to perform support services to the 
extent that these duties interfere with the exercise of their primary 
direct client care duties.
    (d) Standard: Direct care (residential living unit) staff. (1) The 
facility must provide sufficient direct care staff to manage and 
supervise clients in accordance with their individual program plans.
    (2) Direct care staff are defined as the present on-duty staff 
calculated over all shifts in a 24-hour period for each defined 
residential living unit.
    (3) Direct care staff must be provided by the facility in the 
following minimum ratios of direct care staff to clients:
    (i) For each defined residential living unit serving children under 
the age of 12, severely and profoundly retarded clients, clients with 
severe physical disabilities, or clients who are aggressive, assaultive, 
or security risks, or who manifest severely hyperactive or psychotic-
like behavior, the staff to client ratio is 1 to 3.2.
    (ii) For each defined residential living unit serving moderately 
retarded clients, the staff to client ratio is 1 to 4.
    (iii) For each defined residential living unit serving clients who 
function

[[Page 100]]

within the range of mild retardation, the staff to client ratio is 1 to 
6.4.
    (4) When there are no clients present in the living unit, a 
responsible staff member must be available by telephone.
    (e) Standard: Staff training program. (1) The facility must provide 
each employee with initial and continuing training that enables the 
employee to perform his or her duties effectively, efficiently, and 
competently.
    (2) For employees who work with clients, training must focus on 
skills and competencies directed toward clients' developmental, 
behavioral, and health needs.
    (3) Staff must be able to demonstrate the skills and techniques 
necessary to administer interventions to manage the inappropriate 
behavior of clients.
    (4) Staff must be able to demonstrate the skills and techniques 
necessary to implement the individual program plans for each client for 
whom they are responsible.



Sec.  483.440  Condition of participation: Active treatment services.

    (a) Standard: Active treatment. (1) Each client must receive a 
continuous active treatment program, which includes aggressive, 
consistent implementation of a program of specialized and generic 
training, treatment, health services and related services described in 
this subpart, that is directed toward--
    (i) The acquisition of the behaviors necessary for the client to 
function with as much self determination and independence as possible; 
and
    (ii) The prevention or deceleration of regression or loss of current 
optimal functional status.
    (2) Active treatment does not include services to maintain generally 
independent clients who are able to function with little supervision or 
in the absence of a continuous active treatment program.
    (b) Standard: Admissions, transfers, and discharge. (1) Clients who 
are admitted by the facility must be in need of and receiving active 
treatment services.
    (2) Admission decisions must be based on a preliminary evaluation of 
the client that is conducted or updated by the facility or by outside 
sources.
    (3) A preliminary evaluation must contain background information as 
well as currently valid assessments of functional developmental, 
behavioral, social, health and nutritional status to determine if the 
facility can provide for the client's needs and if the client is likely 
to benefit from placement in the facility.
    (4) If a client is to be either transferred or discharged, the 
facility must--
    (i) Have documentation in the client's record that the client was 
transferred or discharged for good cause; and
    (ii) Provide a reasonable time to prepare the client and his or her 
parents or guardian for the transfer or discharge (except in 
emergencies).
    (5) At the time of the discharge, the facility must--
    (i) Develop a final summary of the client's developmental, 
behavioral, social, health and nutritional status and, with the consent 
of the client, parents (if the client is a minor) or legal guardian, 
provide a copy to authorized persons and agencies; and
    (ii) Provide a post-discharge plan of care that will assist the 
client to adjust to the new living environment.
    (c) Standard: Individual program plan. (1) Each client must have an 
individual program plan developed by an interdisciplinary team that 
represents the professions, disciplines or service areas that are 
relevant to--
    (i) Identifying the client's needs, as described by the 
comprehensive functional assessments required in paragraph (c)(3) of 
this section; and
    (ii) Designing programs that meet the client's needs.
    (2) Appropriate facility staff must participate in interdisciplinary 
team meetings. Participation by other agencies serving the client is 
encouraged. Participation by the client, his or her parent (if the 
client is a minor), or the client's legal guardian is required unless 
that participation is unobtainable or inappropriate.
    (3) Within 30 days after admission, the interdisciplinary team must 
perform accurate assessments or reassessments as needed to supplement 
the preliminary evaluation conducted prior to

[[Page 101]]

admission. The comprehensive functional assessment must take into 
consideration the client's age (for example, child, young adult, elderly 
person) and the implications for active treatment at each stage, as 
applicable, and must--
    (i) Identify the presenting problems and disabilities and where 
possible, their causes;
    (ii) Identify the client's specific developmental strengths;
    (iii) Identify the client's specific developmental and behavioral 
management needs;
    (iv) Identify the client's need for services without regard to the 
actual availability of the services needed; and
    (v) Include physical development and health, nutritional status, 
sensorimotor development, affective development, speech and language 
development and auditory functioning, cognitive development, social 
development, adaptive behaviors or independent living skills necessary 
for the client to be able to function in the community, and as 
applicable, vocational skills.
    (4) Within 30 days after admission, the interdisciplinary team must 
prepare for each client an individual program plan that states the 
specific objectives necessary to meet the client's needs, as identified 
by the comprehensive assessment required by paragraph (c)(3) of this 
section, and the planned sequence for dealing with those objectives. 
These objectives must--
    (i) Be stated separately, in terms of a single behavioral outcome;
    (ii) Be assigned projected completion dates;
    (iii) Be expressed in behavioral terms that provide measurable 
indices of performance;
    (iv) Be organized to reflect a developmental progression appropriate 
to the individual; and
    (v) Be assigned priorities.
    (5) Each written training program designed to implement the 
objectives in the individual program plan must specify:
    (i) The methods to be used;
    (ii) The schedule for use of the method;
    (iii) The person responsible for the program;
    (iv) The type of data and frequency of data collection necessary to 
be able to assess progress toward the desired objectives;
    (v) The inappropriate client behavior(s), if applicable; and
    (vi) Provision for the appropriate expression of behavior and the 
replacement of inappropriate behavior, if applicable, with behavior that 
is adaptive or appropriate.
    (6) The individual program plan must also:
    (i) Describe relevant interventions to support the individual toward 
independence.
    (ii) Identify the location where program strategy information (which 
must be accessible to any person responsible for implementation) can be 
found.
    (iii) Include, for those clients who lack them, training in personal 
skills essential for privacy and independence (including, but not 
limited to, toilet training, personal hygiene, dental hygiene, self-
feeding, bathing, dressing, grooming, and communication of basic needs), 
until it has been demonstrated that the client is developmentally 
incapable of acquiring them.
    (iv) Identify mechanical supports, if needed, to achieve proper body 
position, balance, or alignment. The plan must specify the reason for 
each support, the situations in which each is to be applied, and a 
schedule for the use of each support.
    (v) Provide that clients who have multiple disabling conditions 
spend a major portion of each waking day out of bed and outside the 
bedroom area, moving about by various methods and devices whenever 
possible.
    (vi) Include opportunities for client choice and self-management.
    (7) A copy of each client's individual program plan must be made 
available to all relevant staff, including staff of other agencies who 
work with the client, and to the client, parents (if the client is a 
minor) or legal guardian.
    (d) Standard: Program implementation. (1) As soon as the 
interdisciplinary team has formulated a client's individual program 
plan, each client must receive a continuous active treatment program 
consisting of needed interventions and services in sufficient number

[[Page 102]]

and frequency to support the achievement of the objectives identified in 
the individual program plan.
    (2) The facility must develop an active treatment schedule that 
outlines the current active treatment program and that is readily 
available for review by relevant staff.
    (3) Except for those facets of the individual program plan that must 
be implemented only by licensed personnel, each client's individual 
program plan must be implemented by all staff who work with the client, 
including professional, paraprofessional and nonprofessional staff.
    (e) Standard: Program documentation. (1) Data relative to 
accomplishment of the criteria specified in client individual program 
plan objectives must be documented in measureable terms.
    (2) The facility must document significant events that are related 
to the client's individual program plan and assessments and that 
contribute to an overall understanding of the client's ongoing level and 
quality of functioning.
    (f) Standard: Program monitoring and change. (1) The individual 
program plan must be reviewed at least by the qualified mental 
retardation professional and revised as necessary, including, but not 
limited to situations in which the client--
    (i) Has successfully completed an objective or objectives identified 
in the individual program plan;
    (ii) Is regressing or losing skills already gained;
    (iii) Is failing to progress toward identified objectives after 
reasonable efforts have been made; or
    (iv) Is being considered for training towards new objectives.
    (2) At least annually, the comprehensive functional assessment of 
each client must be reviewed by the interdisciplinary team for relevancy 
and updated as needed, and the individual program plan must be revised, 
as appropriate, repeating the process set forth in paragraph (c) of this 
section.
    (3) The facility must designate and use a specially constituted 
committee or committees consisting of members of facility staff, 
parents, legal guardians, clients (as appropriate), qualified persons 
who have either experience or training in contemporary practices to 
change inappropriate client behavior, and persons with no ownership or 
controlling interest in the facility to--
    (i) Review, approve, and monitor individual programs designed to 
manage inappropriate behavior and other programs that, in the opinion of 
the committee, involve risks to client protection and rights;
    (ii) Insure that these programs are conducted only with the written 
informed consent of the client, parent (if the client is a minor), or 
legal guardian; and
    (iii) Review, monitor and make suggestions to the facility about its 
practices and programs as they relate to drug usage, physical 
restraints, time-out rooms, application of painful or noxious stimuli, 
control of inappropriate behavior, protection of client rights and 
funds, and any other area that the committee believes need to be 
addressed.
    (4) The provisions of paragraph (f)(3) of this section may be 
modified only if, in the judgment of the State survey agency, Court 
decrees, State law or regulations provide for equivalent client 
protection and consultation.



Sec.  483.450  Condition of participation: Client behavior and facility practices.

    (a) Standard: Facility practices--Conduct toward clients. (1) The 
facility must develop and implement written policies and procedures for 
the management of conduct between staff and clients. These policies and 
procedures must--
    (i) Promote the growth, development and independence of the client;
    (ii) Address the extent to which client choice will be accommodated 
in daily decision-making, emphasizing self-determination and self-
management, to the extent possible;
    (iii) Specify client conduct to be allowed or not allowed; and
    (iv) Be available to all staff, clients, parents of minor children, 
and legal guardians.
    (2) To the extent possible, clients must participate in the 
formulation of these policies and procedures.
    (3) Clients must not discipline other clients, except as part of an 
organized

[[Page 103]]

system of self-government, as set forth in facility policy.
    (b) Standard: Management of inappropriate client behavior. (1) The 
facility must develop and implement written policies and procedures that 
govern the management of inappropriate client behavior. These policies 
and procedures must be consistent with the provisions of paragraph (a) 
of this section. These procedures must--
    (i) Specify all facility approved interventions to manage 
inappropriate client behavior;
    (ii) Designate these interventions on a hierarchy to be implemented, 
ranging from most positive or least intrusive, to least positive or most 
intrusive;
    (iii) Insure, prior to the use of more restrictive techniques, that 
the client's record documents that programs incorporating the use of 
less intrusive or more positive techniques have been tried 
systematically and demonstrated to be ineffective; and
    (iv) Address the following:
    (A) The use of time-out rooms.
    (B) The use of physical restraints.
    (C) The use of drugs to manage inappropriate behavior.
    (D) The application of painful or noxious stimuli.
    (E) The staff members who may authorize the use of specified 
interventions.
    (F) A mechanism for monitoring and controlling the use of such 
interventions.
    (2) Interventions to manage inappropriate client behavior must be 
employed with sufficient safeguards and supervision to ensure that the 
safety, welfare and civil and human rights of clients are adequately 
protected.
    (3) Techniques to manage inappropriate client behavior must never be 
used for disciplinary purposes, for the convenience of staff or as a 
substitute for an active treatment program.
    (4) The use of systematic interventions to manage inappropriate 
client behavior must be incorporated into the client's individual 
program plan, in accordance with Sec.  483.440(c) (4) and (5) of this 
subpart.
    (5) Standing or as needed programs to control inappropriate behavior 
are not permitted.
    (c) Standard: Time-out rooms. (1) A client may be placed in a room 
from which egress is prevented only if the following conditions are met:
    (i) The placement is a part of an approved systematic time-out 
program as required by paragraph (b) of this section. (Thus, emergency 
placement of a client into a time-out room is not allowed.)
    (ii) The client is under the direct constant visual supervision of 
designated staff.
    (iii) The door to the room is held shut by staff or by a mechanism 
requiring constant physical pressure from a staff member to keep the 
mechanism engaged.
    (2) Placement of a client in a time-out room must not exceed one 
hour.
    (3) Clients placed in time-out rooms must be protected from 
hazardous conditions including, but not limited to, presence of sharp 
corners and objects, uncovered light fixtures, unprotected electrical 
outlets.
    (4) A record of time-out activities must be kept.
    (d) Standard: Physical restraints. (1) The facility may employ 
physical restraint only--
    (i) As an integral part of an individual program plan that is 
intended to lead to less restrictive means of managing and eliminating 
the behavior for which the restraint is applied;
    (ii) As an emergency measure, but only if absolutely necessary to 
protect the client or others from injury; or
    (iii) As a health-related protection prescribed by a physician, but 
only if absolutely necessary during the conduct of a specific medical or 
surgical procedure, or only if absolutely necessary for client 
protection during the time that a medical condition exists.
    (2) Authorizations to use or extend restraints as an emergency must 
be:
    (i) In effect no longer than 12 consecutive hours; and
    (ii) Obtained as soon as the client is restrained or stable.
    (3) The facility must not issue orders for restraint on a standing 
or as needed basis.
    (4) A client placed in restraint must be checked at least every 30 
minutes by staff trained in the use of restraints, released from the 
restraint as quickly

[[Page 104]]

as possible, and a record of these checks and usage must be kept.
    (5) Restraints must be designed and used so as not to cause physical 
injury to the client and so as to cause the least possible discomfort.
    (6) Opportunity for motion and exercise must be provided for a 
period of not less than 10 minutes during each two hour period in which 
restraint is employed, and a record of such activity must be kept.
    (7) Barred enclosures must not be more than three feet in height and 
must not have tops.
    (e) Standard: Drug usage. (1) The facility must not use drugs in 
doses that interfere with the individual client's daily living 
activities.
    (2) Drugs used for control of inappropriate behavior must be 
approved by the interdisciplinary team and be used only as an integral 
part of the client's individual program plan that is directed 
specifically towards the reduction of and eventual elimination of the 
behaviors for which the drugs are employed.
    (3) Drugs used for control of inappropriate behavior must not be 
used until it can be justified that the harmful effects of the behavior 
clearly outweigh the potentially harmful effects of the drugs.
    (4) Drugs used for control of inappropriate behavior must be--
    (i) Monitored closely, in conjunction with the physician and the 
drug regimen review requirement at Sec.  483.460(j), for desired 
responses and adverse consequences by facility staff; and
    (ii) Gradually withdrawn at least annually in a carefully monitored 
program conducted in conjunction with the interdisciplinary team, unless 
clinical evidence justifies that this is contraindicated.



Sec.  483.460  Condition of participation: Health care services.

    (a) Standard: Physician services. (1) The facility must ensure the 
availability of physician services 24 hours a day.
    (2) The physician must develop, in coordination with licensed 
nursing personnel, a medical care plan of treatment for a client if the 
physician determines that an individual client requires 24-hour licensed 
nursing care. This plan must be integrated in the individual program 
plan.
    (3) The facility must provide or obtain preventive and general 
medical care as well as annual physical examinations of each client that 
at a minimum include the following:
    (i) Evaluation of vision and hearing.
    (ii) Immunizations, using as a guide the recommendations of the 
Public Health Service Advisory Commitee on Immunization Practices or of 
the Committee on the Control of Infectious Diseases of the American 
Academy of Pediatrics.
    (iii) Routine screening laboratory examinations as determined 
necessary by the physician, and special studies when needed.
    (iv) Tuberculosis control, appropriate to the facility's population, 
and in accordance with the recommendations of the American College of 
Chest Physicians or the section of diseases of the chest of the American 
Academy of Pediatrics, or both.
    (4) To the extent permitted by State law, the facility may utilize 
physician assistants and nurse practitioners to provide physician 
services as described in this section.
    (b) Standard: Physician participation in the individual program 
plan. A physician must participate in--
    (1) The establishment of each newly admitted client's initial 
individual program plan as required by Sec.  456.380 of this chapter 
that specified plan of care requirements for ICFs; and
    (2) If appropriate, physicians must participate in the review and 
update of an individual program plan as part of the interdisciplinary 
team process either in person or through written report to the 
interdisciplinary team.
    (c) Standard: Nursing services. The facility must provide clients 
with nursing services in accordance with their needs. These services 
must include--
    (1) Participation as appropriate in the development, review, and 
update of an individual program plan as part of the interdisciplinary 
team process;
    (2) The development, with a physician, of a medical care plan of 
treatment for a client when the physician has determined that an 
individual client requires such a plan;

[[Page 105]]

    (3) For those clients certified as not needing a medical care plan, 
a review of their health status which must--
    (i) Be by a direct physical examination;
    (ii) Be by a licensed nurse;
    (iii) Be on a quarterly or more frequent basis depending on client 
need;
    (iv) Be recorded in the client's record; and
    (v) Result in any necessary action (including referral to a 
physician to address client health problems).
    (4) Other nursing care as prescribed by the physician or as 
identified by client needs; and
    (5) Implementing, with other members of the interdisciplinary team, 
appropriate protective and preventive health measures that include, but 
are not limited to--
    (i) Training clients and staff as needed in appropriate health and 
hygiene methods;
    (ii) Control of communicable diseases and infections, including the 
instruction of other personnel in methods of infection control; and
    (iii) Training direct care staff in detecting signs and symptoms of 
illness or dysfunction, first aid for accidents or illness, and basic 
skills required to meet the health needs of the clients.
    (d) Standard: Nursing staff. (1) Nurses providing services in the 
facility must have a current license to practice in the State.
    (2) The facility must employ or arrange for licensed nursing 
services sufficient to care for clients health needs including those 
clients with medical care plans.
    (3) The facility must utilize registered nurses as appropriate and 
required by State law to perform the health services specified in this 
section.
    (4) If the facility utilizes only licensed practical or vocational 
nurses to provide health services, it must have a formal arrangement 
with a registered nurse to be available for verbal or onsite 
consultation to the licensed practical or vocational nurse.
    (5) Non-licensed nursing personnel who work with clients under a 
medical care plan must do so under the supervision of licensed persons.
    (e) Standard: Dental services. (1) The facility must provide or make 
arrangements for comprehensive diagnostic and treatment services for 
each client from qualified personnel, including licensed dentists and 
dental hygienists either through organized dental services in-house or 
through arrangement.
    (2) If appropriate, dental professionals must participate, in the 
development, review and update of an individual program plan as part of 
the interdisciplinary process either in person or through written report 
to the interdisciplinary team.
    (3) The facility must provide education and training in the 
maintenance of oral health.
    (f) Standard: Comprehensive dental diagnostic services. 
Comprehensive dental diagnostic services include--
    (1) A complete extraoral and intraoral examination, using all 
diagnostic aids necessary to properly evaluate the client's oral 
condition, not later than one month after admission to the facility 
(unless the examination was completed within twelve months before 
admission);
    (2) Periodic examination and diagnosis performed at least annually, 
including radiographs when indicated and detection of manifestations of 
systemic disease; and
    (3) A review of the results of examination and entry of the results 
in the client's dental record.
    (g) Standard: Comprehensive dental treatment. The facility must 
ensure comprehensive dental treatment services that include--
    (1) The availability for emergency dental treatment on a 24-hour-a-
day basis by a licensed dentist; and
    (2) Dental care needed for relief of pain and infections, 
restoration of teeth, and maintenance of dental health.
    (h) Standard: Documentation of dental services. (1) If the facility 
maintains an in-house dental service, the facility must keep a permanent 
dental record for each client, with a dental summary maintained in the 
client's living unit.
    (2) If the facility does not maintain an in-house dental service, 
the facility must obtain a dental summary of the results of dental 
visits and maintain

[[Page 106]]

the summary in the client's living unit.
    (i) Standard: Pharmacy services. The facility must provide or make 
arrangements for the provision of routine and emergency drugs and 
biologicals to its clients. Drugs and biologicals may be obtained from 
community or contract pharmacists or the facility may maintain a 
licensed pharmacy.
    (j) Standard: Drug regimen review. (1) A pharmacist with input from 
the interdisciplinary team must review the drug regimen of each client 
at least quarterly.
    (2) The pharmacist must report any irregularities in clients' drug 
regimens to the prescribing physician and interdisciplinary team.
    (3) The pharmacist must prepare a record of each client's drug 
regimen reviews and the facility must maintain that record.
    (4) An individual medication administration record must be 
maintained for each client.
    (5) As appropriate the pharmacist must participate in the 
development, implementation, and review of each client's individual 
program plan either in person or through written report to the 
interdisciplinary team.
    (k) Standard: Drug administration. The facility must have an 
organized system for drug administration that identifies each drug up to 
the point of administration. The system must assure that--
    (1) All drugs are administered in compliance with the physician's 
orders;
    (2) All drugs, including those that are self-administered, are 
administered without error;
    (3) Unlicensed personnel are allowed to administer drugs only if 
State law permits;
    (4) Clients are taught how to administer their own medications if 
the interdisciplinary team determines that self administration of 
medications is an appropriate objective, and if the physician does not 
specify otherwise;
    (5) The client's physician is informed of the interdisciplinary 
team's decision that self-administration of medications is an objective 
for the client;
    (6) No client self-administers medications until he or she 
demonstrates the competency to do so;
    (7) Drugs used by clients while not under the direct care of the 
facility are packaged and labeled in accordance with State law; and
    (8) Drug administration errors and adverse drug reactions are 
recorded and reported immediately to a physician.
    (l) Standard: Drug storage and recordkeeping. (1) The facility must 
store drugs under proper conditions of sanitation, temperature, light, 
humidity, and security.
    (2) The facility must keep all drugs and biologicals locked except 
when being prepared for administration. Only authorized persons may have 
access to the keys to the drug storage area. Clients who have been 
trained to self administer drugs in accordance with Sec.  483.460(k)(4) 
may have access to keys to their individual drug supply.
    (3) The facility must maintain records of the receipt and 
disposition of all controlled drugs.
    (4) The facility must, on a sample basis, periodically reconcile the 
receipt and disposition of all controlled drugs in schedules II through 
IV (drugs subject to the Comprehensive Drug Abuse Prevention and Control 
Act of 1970, 21 U.S.C. 801 et seq., as implemented by 21 CFR part 308).
    (5) If the facility maintains a licensed pharmacy, the facility must 
comply with the regulations for controlled drugs.
    (m) Standard: Drug labeling. (1) Labeling of drugs and biologicals 
must--
    (i) Be based on currently accepted professional principles and 
practices; and
    (ii) Include the appropriate accessory and cautionary instructions, 
as well as the expiration date, if applicable.
    (2) The facility must remove from use--
    (i) Outdated drugs; and
    (ii) Drug containers with worn, illegible, or missing labels.
    (3) Drugs and biologicals packaged in containers designated for a 
particular client must be immediately removed from the client's current 
medication supply if discontinued by the physician.
    (n) Standard: Laboratory services. (1) If a facility chooses to 
provide laboratory services, the laboratory must meet the

[[Page 107]]

requirements specified in part 493 of this chapter.
    (2) If the laboratory chooses to refer specimens for testing to 
another laboratory, the referral laboratory must be certified in the 
appropriate specialties and subspecialities of service in accordance 
with the requirements of part 493 of this chapter.

[53 FR 20496, June 3, 1988, as amended at 57 FR 7136, Feb. 28, 1992]



Sec.  483.470  Condition of participation: Physical environment.

    (a) Standard: Client living environment. (1) The facility must not 
house clients of grossly different ages, developmental levels, and 
social needs in close physical or social proximity unless the housing is 
planned to promote the growth and development of all those housed 
together.
    (2) The facility must not segregate clients solely on the basis of 
their physical disabilities. It must integrate clients who have 
ambulation deficits or who are deaf, blind, or have seizure disorders, 
etc., with others of comparable social and intellectual development.
    (b) Standard: Client bedrooms. (1) Bedrooms must--
    (i) Be rooms that have at least one outside wall;
    (ii) Be equipped with or located near toilet and bathing facilities;
    (iii) Accommodate no more than four clients unless granted a 
variance under paragraph (b)(3) of this section;
    (iv) Measure at least 60 square feet per client in multiple client 
bedrooms and at least 80 square feet in single client bedrooms; and
    (v) In all facilities initially certified, or in buildings 
constructed or with major renovations or conversions on or after October 
3, 1988, have walls that extend from floor to ceiling.
    (2) If a bedroom is below grade level, it must have a window that--
    (i) Is usable as a second means of escape by the client(s) occupying 
the room; and
    (ii) Is no more than 44 inches (measured to the window sill) above 
the floor unless the facility is surveyed under the Health Care 
Occupancy Chapter of the Life Safety Code, in which case the window must 
be no more than 36 inches (measured to the window sill) above the floor.
    (3) The survey agency may grant a variance from the limit of four 
clients per room only if a physician who is a member of the 
interdisciplinary team and who is a qualified mental retardation 
professional--
    (i) Certifies that each client to be placed in a bedroom housing 
more than four persons is so severely medically impaired as to require 
direct and continuous monitoring during sleeping hours; and
    (ii) Documents the reasons why housing in a room of only four or 
fewer persons would not be medically feasible.
    (4) The facility must provide each client with--
    (i) A separate bed of proper size and height for the convenience of 
the client;
    (ii) A clean, comfortable, mattress;
    (iii) Bedding appropriate to the weather and climate; and
    (iv) Functional furniture appropriate to the client's needs, and 
individual closet space in the client's bedroom with clothes racks and 
shelves accessible to the client.
    (c) Standard: Storage space in bedroom. The facility must provide--
    (1) Space and equipment for daily out-of-bed activity for all 
clients who are not yet mobile, except those who have a short-term 
illness or those few clients for whom out-of-bed activity is a threat to 
health and safety; and
    (2) Suitable storage space, accessible to clients, for personal 
possessions, such as TVs, radios, prosthetic equipment and clothing.
    (d) Standard: Client bathrooms. The facility must--
    (1) Provide toilet and bathing facilities appropriate in number, 
size, and design to meet the needs of the clients;
    (2) Provide for individual privacy in toilets, bathtubs, and 
showers; and
    (3) In areas of the facility where clients who have not been trained 
to regulate water temperature are exposed to hot water, ensure that the 
temperature of the water does not exceed 110[deg] Fahrenheit.
    (e) Standard: Heating and ventilation. (1) Each client bedroom in 
the facility must have--

[[Page 108]]

    (i) At least one window to the outside; and
    (ii) Direct outside ventilation by means of windows, air 
conditioning, or mechanical ventilation.
    (2) The facility must--
    (i) Maintain the temperature and humidity within a normal comfort 
range by heating, air conditioning or other means; and
    (ii) Ensure that the heating apparatus does not constitute a burn or 
smoke hazard to clients.
    (f) Standard: Floors. The facility must have--
    (1) Floors that have a resilient, nonabrasive, and slip-resistant 
surface;
    (2) Nonabrasive carpeting, if the area used by clients is carpeted 
and serves clients who lie on the floor or ambulate with parts of their 
bodies, other than feet, touching the floor; and
    (3) Exposed floor surfaces and floor coverings that promote mobility 
in areas used by clients, and promote maintenance of sanitary 
conditions.
    (g) Standard: Space and equipment. The facility must--
    (1) Provide sufficient space and equipment in dining, living, health 
services, recreation, and program areas (including adequately equipped 
and sound treated areas for hearing and other evaluations if they are 
conducted in the facility) to enable staff to provide clients with 
needed services as required by this subpart and as identified in each 
client's individual program plan.
    (2) Furnish, maintain in good repair, and teach clients to use and 
to make informed choices about the use of dentures, eyeglasses, hearing 
and other communications aids, braces, and other devices identified by 
the interdisciplinary team as needed by the client.
    (3) Provide adequate clean linen and dirty linen storage areas.
    (h) Standard: Emergency plan and procedures. (1) The facility must 
develop and implement detailed written plans and procedures to meet all 
potential emergencies and disasters such as fire, severe weather, and 
missing clients.
    (2) The facility must communicate, periodically review, make the 
plan available, and provide training to the staff.
    (i) Standard: Evacuation drills. (1) The facility must hold 
evacuation drills at least quarterly for each shift of personnel and 
under varied conditions to--
    (i) Ensure that all personnel on all shifts are trained to perform 
assigned tasks;
    (ii) Ensure that all personnel on all shifts are familiar with the 
use of the facility's fire protection features; and
    (iii) Evaluate the effectiveness of emergency and disaster plans and 
procedures.
    (2) The facility must--
    (i) Actually evacuate clients during at least one drill each year on 
each shift;
    (ii) Make special provisions for the evacuation of clients with 
physical disabilities;
    (iii) File a report and evaluation on each evacuation drill;
    (iv) Investigate all problems with evacuation drills, including 
accidents, and take corrective action; and
    (v) During fire drills, clients may be evacuated to a safe area in 
facilities certified under the Health Care Occupancies Chapter of the 
Life Safety Code.
    (3) Facilities must meet the requirements of paragraphs (i)(1) and 
(2) of this section for any live-in and relief staff they utilize.
    (j) Standard: Fire protection--(1) General. Except as otherwise 
provided in this section--
    (i) The facility must meet the applicable provisions of either the 
Health Care Occupancies Chapters or the Residential Board and Care 
Occupancies Chapter of the 2000 edition of the Life Safety Code of the 
National Fire Protection Association. The Director of the Office of the 
Federal Register has approved the NFPA 101 [reg] 2000 edition 
of the Life Safety Code, issued January 14, 2000, for incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy 
of the Code is available for inspection at the CMS Information Resource 
Center, 7500 Security Boulevard, Baltimore, MD or at the National 
Archives and Records Administration (NARA). For information on the 
availability of this material at NARA, call 202-741-6030, or go to: 
http://www.archives.gov/federal--register/code--of--federal--
regulations/

[[Page 109]]

ibr--locations.html. Copies may be obtained from the National Fire 
Protection Association, 1 Batterymarch Park, Quincy, MA 02269. If any 
changes in this edition of the Code are incorporated by reference, CMS 
will publish notice in the Federal Register to announce the changes.
    (ii) Chapter 19.3.6.3.2, exception number 2 of the adopted LSC does 
not apply to a facility.
    (2) The State survey agency may apply a single chapter of the LSC to 
the entire facility or may apply different chapters to different 
buildings or parts of buildings as permitted by the LSC.
    (3) A facility that meets the LSC definition of a residential board 
and care occupancy must have its evacuation capability evaluated in 
accordance with the Evacuation Difficulty Index of the Fire Safety 
Evaluation System for Board and Care facilities (FSES/BC).
    (4) If CMS finds that the State has a fire and safety code imposed 
by State law that adequately protects a facility's clients, CMS may 
allow the State survey agency to apply the State's fire and safety code 
instead of the LSC.
    (5) Beginning March 13, 2006, a facility must be in compliance with 
Chapter 19.2.9, Emergency Lighting.
    (6) Beginning March 13, 2006, Chapter 19.3.6.3.2, exception number 2 
does not apply to a facility.
    (7) Facilities that meet the LSC definition of a health care 
occupancy. (i) After consideration of State survey agency 
recommendations, CMS may waive, for appropriate periods, specific 
provisions of the Life Safety Code if the following requirements are 
met:
    (A) The waiver would not adversely affect the health and safety of 
the clients.
    (B) Rigid application of specific provisions would result in an 
unreasonable hardship for the facility.
    (ii) Notwithstanding any provisions of the 2000 edition of the Life 
Safety Code to the contrary, a facility may install alcohol-based hand 
rub dispensers if--
    (A) Use of alcohol-based hand rub dispensers does not conflict with 
any State or local codes that prohibit or otherwise restrict the 
placement of alcohol-based hand rub dispensers in health care 
facilities;
    (B) The dispensers are installed in a manner that minimizes leaks 
and spills that could lead to falls;
    (C) The dispensers are installed in a manner that adequately 
protects against inappropriate access;
    (D) The dispensers are installed in accordance with chapter 18.3.2.7 
or chapter 19.3.2.7 of the 2000 edition of the Life Safety Code, as 
amended by NFPA Temporary Interim Amendment 00-1(101), issued by the 
Standards Council of the National Fire Protection Association on April 
15, 2004. The Director of the Office of the Federal Register has 
approved NFPA Temporary Interim Amendment 00-1(101) for incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy 
of the amendment is available for inspection at the CMS Information 
Resource Center, 7500 Security Boulevard, Baltimore, MD and at the 
Office of the Federal Register, 800 North Capitol Street NW., Suite 700, 
Washington, DC. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269; and
    (E) The dispensers are maintained in accordance with dispenser 
manufacturer guidelines.
    (k) Standard: Paint. The facility must--
    (1) Use lead-free paint inside the facility; and
    (2) Remove or cover interior paint or plaster containing lead so 
that it is not accessible to clients.
    (l) Standard: Infection control. (1) The facility must provide a 
sanitary environment to avoid sources and transmission of infections. 
There must be an active program for the prevention, control, and 
investigation of infection and communicable diseases.
    (2) The facility must implement successful corrective action in 
affected problem areas.
    (3) The facility must maintain a record of incidents and corrective 
actions related to infections.
    (4) The facility must prohibit employees with symptoms or signs of a

[[Page 110]]

communicable disease from direct contact with clients and their food.

[53 FR 20496, June 3, 1988. Redesignated at 56 FR 48918, Sept. 26, 1991, 
as amended at 68 FR 1387, Jan. 10, 2003; 69 FR 49271, Aug. 11, 2004; 70 
FR 15239, Mar. 25, 2005; 71 FR 55340, Sept. 22, 2006]



Sec.  483.480  Condition of participation: Dietetic services.

    (a) Standard: Food and nutrition services. (1) Each client must 
receive a nourishing, well-balanced diet including modified and 
specially-prescribed diets.
    (2) A qualified dietitian must be employed either full-time, part-
time, or on a consultant basis at the facility's discretion.
    (3) If a qualified dietitian is not employed full-time, the facility 
must designate a person to serve as the director of food services.
    (4) The client's interdisciplinary team, including a qualified 
dietitian and physician, must prescribe all modified and special diets 
including those used as a part of a program to manage inappropriate 
client behavior.
    (5) Foods proposed for use as a primary reinforcement of adaptive 
behavior are evaluated in light of the client's nutritional status and 
needs.
    (6) Unless otherwise specified by medical needs, the diet must be 
prepared at least in accordance with the latest edition of the 
recommended dietary allowances of the Food and Nutrition Board of the 
National Research Council, National Academy of Sciences, adjusted for 
age, sex, disability and activity.
    (b) Standard: Meal services. (1) Each client must receive at least 
three meals daily, at regular times comparable to normal mealtimes in 
the community with--
    (i) Not more than 14 hours between a substantial evening meal and 
breakfast of the following day, except on weekends and holidays when a 
nourishing snack is provided at bedtime, 16 hours may elapse between a 
substantial evening meal and breakfast; and
    (ii) Not less than 10 hours between breakfast and the evening meal 
of the same day, except as provided under paragraph (b)(1)(i) of this 
section.
    (2) Food must be served--
    (i) In appropriate quantity;
    (ii) At appropriate temperature;
    (iii) In a form consistent with the developmental level of the 
client; and
    (iv) With appropriate utensils.
    (3) Food served to clients individually and uneaten must be 
discarded.
    (c) Standard: Menus. (1) Menus must--
    (i) Be prepared in advance;
    (ii) Provide a variety of foods at each meal;
    (iii) Be different for the same days of each week and adjusted for 
seasonal changes; and
    (iv) Include the average portion sizes for menu items.
    (2) Menus for food actually served must be kept on file for 30 days.
    (d) Standard: Dining areas and service. The facility must--
    (1) Serve meals for all clients, including persons with ambulation 
deficits, in dining areas, unless otherwise specified by the 
interdisciplinary team or a physician;
    (2) Provide table service for all clients who can and will eat at a 
table, including clients in wheelchairs;
    (3) Equip areas with tables, chairs, eating utensils, and dishes 
designed to meet the developmental needs of each client;
    (4) Supervise and staff dining rooms adequately to direct self-help 
dining procedure, to assure that each client receives enough food and to 
assure that each client eats in a manner consistent with his or her 
developmental level: and
    (5) Ensure that each client eats in an upright position, unless 
otherwise specified by the interdisciplinary team or a physician.



PART 484_HOME HEALTH SERVICES--Table of Contents




                      Subpart A_General Provisions

Sec.
484.1 Basis and scope.
484.2 Definitions.
484.4 Personnel qualifications.

                        Subpart B_Administration

484.10 Condition of participation: Patient rights.
484.11 Condition of participation: Release of patient identifiable OASIS 
          information.
484.12 Condition of participation: Compliance with Federal, State, and 
          local laws,

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          disclosure and ownership information, and accepted 
          professional standards and principles.
484.14 Condition of participation: Organization, services, and 
          administration.
484.16 Condition of participation: Group of professional personnel.
484.18 Condition of participation: Acceptance of patients, plan of care, 
          and medical supervision.
484.20 Condition of participation: Reporting OASIS information.

                    Subpart C_Furnishing of Services

484.30 Condition of participation: Skilled nursing services.
484.32 Condition of participation: Therapy services.
484.34 Condition of participation: Medical social services.
484.36 Condition of participation: Home health aide services.
484.38 Condition of participation: Qualifying to furnish outpatient 
          physical therapy or speech pathology services.
484.48 Condition of participation: Clinical records.
484.52 Condition of participation: Evaluation of the agency's program.
484.55 Condition of participation: Comprehensive assessment of patients.

Subpart D [Reserved]

      Subpart E_Prospective Payment System for Home Health Agencies

484.200 Basis and scope.
484.202 Definitions.
484.205 Basis of payment.
484.210 Data used for the calculation of the national prospective 60-day 
          episode payment.
484.215 Initial establishment of the calculation of the national 60-day 
          episode payment.
484.220 Calculation of the national adjusted prospective 60-day episode 
          payment rate for case-mix and area wage levels.
484.225 Annual update of the national adjusted prospective 60-day 
          episode payment rate.
484.230 Methodology used for the calculation of the low-utilization 
          payment adjustment.
484.235 Methodology used for the calculation of the partial episode 
          payment adjustment.
484.240 Methodology used for the calculation of the outlier payment.
484.245 Accelerated payments for home health agencies.
484.250 Patient assessment data.
484.260 Limitation on review.
484.265 Additional payment.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395(hh)) unless otherwise indicated.

    Source: 54 FR 33367, Aug. 14, 1989, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  484.1  Basis and scope.

    (a) Basis and scope. This part is based on the indicated provisions 
of the following sections of the Act:
    (1) Sections 1861(o) and 1891 establish the conditions that an HHA 
must meet in order to participate in Medicare.
    (2) Section 1861(z) specifies the Institutional planning standards 
that HHAs must meet.
    (3) Section 1895 provides for the establishment of a prospective 
payment system for home health services covered under Medicare.
    (b) This part also sets forth additional requirements that are 
considered necessary to ensure the health and safety of patients.

[60 FR 50443, Sept. 29, 1995, as amended at 65 FR 41211, July 3, 2000]



Sec.  484.2  Definitions.

    As used in this part, unless the context indicates otherwise--Bylaws 
or equivalent means a set of rules adopted by an HHA for governing the 
agency's operation.
    Branch office means a location or site from which a home health 
agency provides services within a portion of the total geographic area 
served by the parent agency. The branch office is part of the home 
health agency and is located sufficiently close to share administration, 
supervision, and services in a manner that renders it unnecessary for 
the branch independently to meet the conditions of participation as a 
home health agency.
    Clinical note means a notation of a contact with a patient that is 
written and dated by a member of the health team, and that describes 
signs and symptoms, treatment and drugs administered and the patient's 
reaction, and any changes in physical or emotional condition.
    HHA stands for home health agency.
    Nonprofit agency means an agency exempt from Federal income taxation

[[Page 112]]

under section 501 of the Internal Revenue Code of 1954.
    Parent home health agency means the agency that develops and 
maintains administrative controls of subunits and/or branch offices.
    Primary home health agency means the agency that is responsible for 
the services furnished to patients and for implementation of the plan of 
care.
    Progress note means a written notation, dated and signed by a member 
of the health team, that summarizes facts about care furnished and the 
patient's response during a given period of time.
    Proprietary agency means a private profit-making agency licensed by 
the State.
    Public agency means an agency operated by a State or local 
government.
    Subdivision means a component of a multi-function health agency, 
such as the home care department of a hospital or the nursing division 
of a health department, which independently meets the conditions of 
participation for HHAs. A subdivision that has subunits or branch 
offices is considered a parent agency.
    Subunit means a semi-autonomous organization that--
    (1) Serves patients in a geographic area different from that of the 
parent agency; and
    (2) Must independently meet the conditions of participation for HHAs 
because it is too far from the parent agency to share administration, 
supervision, and services on a daily basis.
    Summary report means the compilation of the pertinent factors of a 
patient's clinical notes and progress notes that is submitted to the 
patient's physician.
    Supervision means authoritative procedural guidance by a qualified 
person for the accomplishment of a function or activity. Unless 
otherwise specified in this part, the supervisor must be on the premises 
to supervise an individual who does not meet the qualifications 
specified in Sec.  484.4.



Sec.  484.4  Personnel qualifications.

    Staff required to meet the conditions set forth in this part are 
staff who meet the qualifications specified in this section.
    Administrator, home health agency. A person who:
    (a) Is a licensed physician; or
    (b) Is a registered nurse; or
    (c) Has training and experience in health service administration and 
at least 1 year of supervisory or administrative experience in home 
health care or related health programs.
    Audiologist. A person who:
    (a) Meets the education and experience requirements for a 
Certificate of Clinical Competence in audiology granted by the American 
Speech-Language-Hearing Association; or
    (b) Meets the educational requirements for certification and is in 
the process of accumulating the supervised experience required for 
certification.
    Home health aide. Effective for services furnished after August 14, 
1990, a person who has successfully completed a State-established or 
other training program that meets the requirements of Sec.  484.36(a) 
and a competency evaluation program or State licensure program that 
meets the requirements of Sec.  484.36 (b) or (e), or a competency 
evaluation program or State licensure program that meets the 
requirements of Sec.  484.36 (b) or (e). An individual is not considered 
to have completed a training and competency evaluation program, or a 
competency evaluation program if, since the individual's most recent 
completion of this program(s), there has been a continuous period of 24 
consecutive months during none of which the individual furnished 
services described in Sec.  409.40 of this chapter for compensation.
    Occupational therapist. A person who--
    (a)(1) Is licensed or otherwise regulated, if applicable, as an 
occupational therapist by the State in which practicing, unless 
licensure does not apply;
    (2) Graduated after successful completion of an occupational 
therapist education program accredited by the Accreditation Council for 
Occupational Therapy Education (ACOTE) of the American Occupational 
Therapy Association, Inc. (AOTA), or successor organizations of ACOTE; 
and
    (3) Is eligible to take, or has successfully completed the entry-
level certification examination for occupational therapists developed 
and administered

[[Page 113]]

by the National Board for Certification in Occupational Therapy, Inc. 
(NBCOT).
    (b) On or before December 31, 2009--
    (1) Is licensed or otherwise regulated, if applicable, as an 
occupational therapist by the State in which practicing; or
    (2) When licensure or other regulation does not apply--
    (i) Graduated after successful completion of an occupational 
therapist education program accredited by the Accreditation Council for 
Occupational Therapy Education (ACOTE) of the American Occupational 
Therapy Association, Inc. (AOTA) or successor organizations of ACOTE; 
and
    (ii) Is eligible to take, or has successfully completed the entry-
level certification examination for occupational therapists developed 
and administered by the National Board for Certification in Occupational 
Therapy, Inc., (NBCOT).
    (c) On or before January 1, 2008--
    (1) Graduated after successful completion of an occupational therapy 
program accredited jointly by the committee on Allied Health Education 
and Accreditation of the American Medical Association and the American 
Occupational Therapy Association; or
    (2) Is eligible for the National Registration Examination of the 
American Occupational Therapy Association or the National Board for 
Certification in Occupational Therapy.
    (d) On or before December 31, 1977--
    (1) Had 2 years of appropriate experience as an occupational 
therapist; and
    (2) Had achieved a satisfactory grade on an occupational therapist 
proficiency examination conducted, approved, or sponsored by the U.S. 
Public Health Service.
    (e) If educated outside the United States, must meet all of the 
following:
    (1) Graduated after successful completion of an occupational 
therapist education program accredited as substantially equivalent to 
occupational therapist entry level education in the United States by one 
of the following:
    (i) The Accreditation Council for Occupational Therapy Education 
(ACOTE).
    (ii) Successor organizations of ACOTE.
    (iii) The World Federation of Occupational Therapists.
    (iv) A credentialing body approved by the American Occupational 
Therapy Association.
    (2) Successfully completed the entry-level certification examination 
for occupational therapists developed and administered by the National 
Board for Certification in Occupational Therapy, Inc. (NBCOT).
    (3) On or before December 31, 2009, is licensed or otherwise 
regulated, if applicable, as an occupational therapist by the State in 
which practicing.
    Occupational therapy assistant. A person who--
    (a) Meets all of the following:
    (1) Is licensed, unless licensure does not apply, or otherwise 
regulated, if applicable, as an occupational therapy assistant by the 
State in which practicing.
    (2) Graduated after successful completion of an occupational therapy 
assistant education program accredited by the Accreditation Council for 
Occupational Therapy Education, (ACOTE) of the American Occupational 
Therapy Association, Inc. (AOTA) or its successor organizations.
    (3) Is eligible to take or successfully completed the entry-level 
certification examination for occupational therapy assistants developed 
and administered by the National Board for Certification in Occupational 
Therapy, Inc. (NBCOT).
    (b) On or before December 31, 2009--
    (1) Is licensed or otherwise regulated as an occupational therapy 
assistant, if applicable, by the State in which practicing; or any 
qualifications defined by the State in which practicing, unless 
licensure does not apply; or
    (2) Must meet both of the following:
    (i) Completed certification requirements to practice as an 
occupational therapy assistant established by a credentialing 
organization approved by the American Occupational Therapy Association.
    (ii) After January 1, 2010, meets the requirements in paragraph (a) 
of this section.
    (c) After December 31, 1977 and on or before December 31, 2007--
    (1) Completed certification requirements to practice as an 
occupational

[[Page 114]]

therapy assistant established by a credentialing organization approved 
by the American Occupational Therapy Association; or
    (2) Completed the requirements to practice as an occupational 
therapy assistant applicable in the State in which practicing.
    (d) On or before December 31, 1977--
    (1) Had 2 years of appropriate experience as an occupational therapy 
assistant; and
    (2) Had achieved a satisfactory grade on an occupational therapy 
assistant proficiency examination conducted, approved, or sponsored by 
the U.S. Public Health Service.
    (e) If educated outside the United States, on or after January 1, 
2008--
    (1) Graduated after successful completion of an occupational therapy 
assistant education program that is accredited as substantially 
equivalent to occupational therapist assistant entry level education in 
the United States by--
    (i) The Accreditation Council for Occupational Therapy Education 
(ACOTE).
    (ii) Its successor organizations.
    (iii) The World Federation of Occupational Therapists.
    (iv) By a credentialing body approved by the American Occupational 
Therapy Association; and
    (2) Successfully completed the entry-level certification examination 
for occupational therapy assistants developed and administered by the 
National Board for Certification in Occupational Therapy, Inc. (NBCOT).
    Physical therapist. A person who is licensed, if applicable, by the 
State in which practicing, unless licensure does not apply and meets one 
of the following requirements:
    (a)(1) Graduated after successful completion of a physical therapist 
education program approved by one of the following:
    (i) The Commission on Accreditation in Physical Therapy Education 
(CAPTE).
    (ii) Successor organizations of CAPTE.
    (iii) An education program outside the United States determined to 
be substantially equivalent to physical therapist entry-level education 
in the United States by a credentials evaluation organization approved 
by the American Physical Therapy Association or an organization 
identified in 8 CFR 212.15(e) as it relates to physical therapists; and
    (2) Passed an examination for physical therapists approved by the 
State in which physical therapy services are provided.
    (b) On or before December 31, 2009--
    (1) Graduated after successful completion of a physical therapy 
curriculum approved by the Commission on Accreditation in Physical 
Therapy Education (CAPTE); or
    (2) Meets both of the following:
    (i) Graduated after successful completion of an education program 
determined to be substantially equivalent to physical therapist entry 
level education in the United States by a credentials evaluation 
organization approved by the American Physical Therapy Association or 
identified in 8 CFR 212.15(e) as it relates to physical therapists.
    (ii) Passed an examination for physical therapists approved by the 
State in which physical therapy services are provided.
    (c) Before January 1, 2008--
    (1) Graduated from a physical therapy curriculum approved by one of 
the following:
    (i) The American Physical Therapy Association.
    (ii) The Committee on Allied Health Education and Accreditation of 
the American Medical Association.
    (iii) The Council on Medical Education of the American Medical 
Association and the American Physical Therapy Association.
    (d) On or before December 31, 1977 was licensed or qualified as a 
physical therapist and meets both of the following:
    (1) Has 2 years of appropriate experience as a physical therapist.
    (2) Has achieved a satisfactory grade on a proficiency examination 
conducted, approved, or sponsored by the U.S. Public Health Service.
    (e) Before January 1, 1966--
    (1) Was admitted to membership by the American Physical Therapy 
Association; or

[[Page 115]]

    (2) Was admitted to registration by the American Registry of 
Physical Therapists; or
    (3) Has graduated from a physical therapy curriculum in a 4-year 
college or university approved by a State department of education.
    (f) Before January 1, 1966 was licensed or registered, and before 
January 1, 1970, had 15 years of full-time experience in the treatment 
of illness or injury through the practice of physical therapy in which 
services were rendered under the order and direction of attending and 
referring doctors of medicine or osteopathy.
    (g) If trained outside the United States before January 1, 2008, 
meets the following requirements:
    (1) Was graduated since 1928 from a physical therapy curriculum 
approved in the country in which the curriculum was located and in which 
there is a member organization of the World Confederation for Physical 
Therapy.
    (2) Meets the requirements for membership in a member organization 
of the World Confederation for Physical Therapy.
    Physical therapist assistant. A person who is licensed, unless 
licensure does not apply, registered, or certified as a physical 
therapist assistant, if applicable, by the State in which practicing, 
and meets one of the following requirements:
    (a)(1) Graduated from a physical therapist assistant curriculum 
approved by the Commission on Accreditation in Physical Therapy 
Education of the American Physical Therapy Association; or if educated 
outside the United States or trained in the United States military, 
graduated from an education program determined to be substantially 
equivalent to physical therapist assistant entry level education in the 
United States by a credentials evaluation organization approved by the 
American Physical Therapy Association or identified at 8 CFR 212.15(e); 
and
    (2) Passed a national examination for physical therapist assistants.
    (b) On or before December 31, 2009, meets one of the following:
    (1) Is licensed, or otherwise regulated in the State in which 
practicing.
    (2) In States where licensure or other regulations do not apply, 
graduated on or before December 31, 2009, from a 2-year college-level 
program approved by the American Physical Therapy Association and, 
effective January 1, 2010 meets the requirements of paragraph (a) of 
this definition.
    (c) Before January 1, 2008, where licensure or other regulation does 
not apply, graduated from a 2-year college-level program approved by the 
American Physical Therapy Association.
    (d) On or before December 31, 1977, was licensed or qualified as a 
physical therapist assistant and has achieved a satisfactory grade on a 
proficiency examination conducted, approved, or sponsored by the U.S. 
Public Health Service.
    Physician. A doctor of medicine, osteophathy or podiatry legally 
authorized to practice medicine and surgery by the State in which such 
function or action is performed.
    Practical (vocational) nurse. A person who is licensed as a 
practical (vocational) nurse by the State in which practicing.
    Public health nurse. A registered nurse who has completed a 
baccalaureate degree program approved by the National League for Nursing 
for public health nursing preparation or postregistered nurse study that 
includes content aproved by the National League for Nursing for public 
health nursing preparation.
    Registered nurse (RN). A graduate of an approved school of 
professional nursing, who is licensed as a registered nurse by the State 
in which practicing.
    Social work assistant. A person who:
    (1) Has a baccalaureate degree in social work, psychology, 
sociology, or other field related to social work, and has had at least 1 
year of social work experience in a health care setting; or
    (2) Has 2 years of appropriate experience as a social work 
assistant, and has achieved a satisfactory grade on a proficiency 
examination conducted, approved, or sponsored by the U.S. Public Health 
Service, except that these determinations of proficiency do not apply 
with respect to persons initially licensed by a State or seeking initial 
qualification as a social work assistant after December 31, 1977.

[[Page 116]]

    Social worker. A person who has a master's degree from a school of 
social work accredited by the Council on Social Work Education, and has 
1 year of social work experience in a health care setting.
    Speech-language pathologist. A person who meets either of the 
following requirements:
    (a) The education and experience requirements for a Certificate of 
Clinical Competence in speech-language pathology granted by the American 
Speech-Language-Hearing Association.
    (b) The educational requirements for certification and is in the 
process of accumulating the supervised experience required for 
certification.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32973, July 18, 1991; 
69 FR 66426, Nov. 15, 2004; 72 FR 66406, Nov. 27, 2007; 73 FR 2433, Jan. 
15, 2008]



                        Subpart B_Administration



Sec.  484.10  Condition of participation: Patient rights.

    The patient has the right to be informed of his or her rights. The 
HHA must protect and promote the exercise of these rights.
    (a) Standard: Notice of rights. (1) The HHA must provide the patient 
with a written notice of the patient's rights in advance of furnishing 
care to the patient or during the initial evaluation visit before the 
initiation of treatment.
    (2) The HHA must maintain documentation showing that it has complied 
with the requirements of this section.
    (b) Standard: Exercise of rights and respect for property and 
person. (1) The patient has the right to exercise his or her rights as a 
patient of the HHA.
    (2) The patient's family or guardian may exercise the patient's 
rights when the patient has been judged incompetent.
    (3) The patient has the right to have his or her property treated 
with respect.
    (4) The patient has the right to voice grievances regarding 
treatment or care that is (or fails to be) furnished, or regarding the 
lack of respect for property by anyone who is furnishing services on 
behalf of the HHA and must not be subjected to discrimination or 
reprisal for doing so.
    (5) The HHA must investigate complaints made by a patient or the 
patient's family or guardian regarding treatment or care that is (or 
fails to be) furnished, or regarding the lack of respect for the 
patient's property by anyone furnishing services on behalf of the HHA, 
and must document both the existence of the complaint and the resolution 
of the complaint.
    (c) Standard: Right to be informed and to participate in planning 
care and treatment. (1) The patient has the right to be informed, in 
advance about the care to be furnished, and of any changes in the care 
to be furnished.
    (i) The HHA must advise the patient in advance of the disciplines 
that will furnish care, and the frequency of visits proposed to be 
furnished.
    (ii) The HHA must advise the patient in advance of any change in the 
plan of care before the change is made.
    (2) The patient has the right to participate in the planning of the 
care.
    (i) The HHA must advise the patient in advance of the right to 
participate in planning the care or treatment and in planning changes in 
the care or treatment.
    (ii) The HHA complies with the requirements of subpart I of part 489 
of this chapter relating to maintaining written policies and procedures 
regarding advance directives. The HHA must inform and distribute written 
information to the patient, in advance, concerning its policies on 
advance directives, including a description of applicable State law. The 
HHA may furnish advance directives information to a patient at the time 
of the first home visit, as long as the information is furnished before 
care is provided.
    (d) Standard: Confidentiality of medical records. The patient has 
the right to confidentiality of the clinical records maintained by the 
HHA. The HHA must advise the patient of the agency's policies and 
procedures regarding disclosure of clinical records.
    (e) Standard: Patient liability for payment. (1) The patient has the 
right to be advised, before care is initiated, of the extent to which 
payment for the HHA services may be expected from

[[Page 117]]

Medicare or other sources, and the extent to which payment may be 
required from the patient. Before the care is initiated, the HHA must 
inform the patient, orally and in writing, of--
    (i) The extent to which payment may be expected from Medicare, 
Medicaid, or any other Federally funded or aided program known to the 
HHA;
    (ii) The charges for services that will not be covered by Medicare; 
and
    (iii) The charges that the individual may have to pay.
    (2) The patient has the right to be advised orally and in writing of 
any changes in the information provided in accordance with paragraph 
(e)(1) of this section when they occur. The HHA must advise the patient 
of these changes orally and in writing as soon as possible, but no later 
than 30 calendar days from the date that the HHA becomes aware of a 
change.
    (f) Standard: Home health hotline. The patient has the right to be 
advised of the availability of the toll-free HHA hotline in the State. 
When the agency accepts the patient for treatment or care, the HHA must 
advise the patient in writing of the telephone number of the home health 
hotline established by the State, the hours of its operation, and that 
the purpose of the hotline is to receive complaints or questions about 
local HHAs. The patient also has the right to use this hotline to lodge 
complaints concerning the implementation of the advance directives 
requirements.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32973, July 18, 1991; 
57 FR 8203, Mar. 6, 1992; 60 FR 33293, June 27, 1995]



Sec.  484.11  Condition of participation: Release of patient identifiable OASIS information.

    The HHA and agent acting on behalf of the HHA in accordance with a 
written contract must ensure the confidentiality of all patient 
identifiable information contained in the clinical record, including 
OASIS data, and may not release patient identifiable OASIS information 
to the public.

[64 FR 3763, Jan. 25, 1999]



Sec.  484.12  Condition of participation: Compliance with Federal, State, and local laws, disclosure and ownership information, and accepted professional 
          standards and principles.

    (a) Standard: Compliance with Federal, State, and local laws and 
regulations. The HHA and its staff must operate and furnish services in 
compliance with all applicable Federal, State, and local laws and 
regulations. If State or applicable local law provides for the licensure 
of HHAs, an agency not subject to licensure is approved by the licensing 
authority as meeting the standards established for licensure.
    (b) Standard: Disclosure of ownership and management information. 
The HHA must comply with the requirements of Part 420, Subpart C of this 
chapter. The HHA also must disclose the following information to the 
State survey agency at the time of the HHA's initial request for 
certification, for each survey, and at the time of any change in 
ownership or management:
    (1) The name and address of all persons with an ownership or control 
interest in the HHA as defined in Sec. Sec.  420.201, 420.202, and 
420.206 of this chapter.
    (2) The name and address of each person who is an officer, a 
director, an agent or a managing employee of the HHA as defined in 
Sec. Sec.  420.201, 420.202, and 420.206 of this chapter.
    (3) The name and address of the corporation, association, or other 
company that is responsible for the management of the HHA, and the name 
and address of the chief executive officer and the chairman of the board 
of directors of that corporation, association, or other company 
responsible for the management of the HHA.
    (c) Standard: Compliance with accepted professional standards and 
principles. The HHA and its staff must comply with accepted professional 
standards and principles that apply to professionals furnishing services 
in an HHA.

[[Page 118]]



Sec.  484.14  Condition of participation: Organization, services, and administration.

    Organization, services furnished, administrative control, and lines 
of authority for the delegation of responsibility down to the patient 
care level are clearly set forth in writing and are readily 
identifiable. Administrative and supervisory functions are not delegated 
to another agency or organization and all services not furnished 
directly, including services provided through subunits are monitored and 
controlled by the parent agency. If an agency has subunits, appropriate 
administrative records are maintained for each subunit.
    (a) Standard: Services furnished. Part-time or intermittent skilled 
nursing services and at least one other therapeutic service (physical, 
speech, or occupational therapy; medical social services; or home health 
aide services) are made available on a visiting basis, in a place of 
residence used as a patient's home. An HHA must provide at least one of 
the qualifying services directly through agency employees, but may 
provide the second qualifying service and additional services under 
arrangements with another agency or organization.
    (b) Standard: Governing body. A governing body (or designated 
persons so functioning) assumes full legal authority and responsibility 
for the operation of the agency. The governing body appoints a qualified 
administrator, arranges for professional advice as required under Sec.  
484.16, adopts and periodically reviews written bylaws or an acceptable 
equivalent, and oversees the management and fiscal affairs of the 
agency.
    (c) Standard: Administrator. The administrator, who may also be the 
supervising physician or registered nurse required under paragraph (d) 
of this section, organizes and directs the agency's ongoing functions; 
maintains ongoing liaison among the governing body, the group of 
professional personnel, and the staff; employs qualified personnel and 
ensures adequate staff education and evaluations; ensures the accuracy 
of public information materials and activities; and implements an 
effective budgeting and accounting system. A qualified person is 
authorized in writing to act in the absence of the administrator.
    (d) Standard: Supervising physician or registered nurse. The skilled 
nursing and other therapeutic services furnished are under the 
supervision and direction of a physician or a registered nurse (who 
preferably has at least 1 year of nursing experience and is a public 
health nurse). This person, or similarly qualified alternate, is 
available at all times during operating hours and participates in all 
activities relevant to the professional services furnished, including 
the development of qualifications and the assignment of personnel.
    (e) Standard: Personnel policies. Personnel practices and patient 
care are supported by appropriate, written personnel policies. Personnel 
records include qualifications and licensure that are kept current.
    (f) Standard: Personnel under hourly or per visit contracts. If 
personnel under hourly or per visit contracts are used by the HHA, there 
is a written contract between those personnel and the agency that 
specifies the following:
    (1) Patients are accepted for care only by the primary HHA.
    (2) The services to be furnished.
    (3) The necessity to conform to all applicable agency policies, 
including personnel qualifications.
    (4) The responsibility for participating in developing plans of 
care.
    (5) The manner in which services will be controlled, coordinated, 
and evaluated by the primary HHA.
    (6) The procedures for submitting clinical and progress notes, 
scheduling of visits, periodic patient evaluation.
    (7) The procedures for payment for services furnished under the 
contract.
    (g) Standard: Coordination of patient services. All personnel 
furnishing services maintain liaison to ensure that their efforts are 
coordinated effectively and support the objectives outlined in the plan 
of care. The clinical record or minutes of case conferences establish 
that effective interchange, reporting, and coordination of patient care 
does occur. A written summary report for each patient is sent to the 
attending physician at least every 60 days.

[[Page 119]]

    (h) Standard: Services under arrangements. Services furnished under 
arrangements are subject to a written contract conforming with the 
requirements specified in paragraph (f) of this section and with the 
requirements of section 1861(w) of the Act (42 U.S.C. 1495x(w)).
    (i) Standard: Institutional planning. The HHA, under the direction 
of the governing body, prepares an overall plan and a budget that 
includes an annual operating budget and capital expenditure plan.
    (1) Annual operating budget. There is an annual operating budget 
that includes all anticipated income and expenses related to items that 
would, under generally accepted accounting principles, be considered 
income and expense items. However, it is not required that there be 
prepared, in connection with any budget, an item by item identification 
of the components of each type of anticipated income or expense.
    (2) Capital expenditure plan. (i) There is a capital expenditure 
plan for at least a 3-year period, including the operating budget year. 
The plan includes and identifies in detail the anticipated sources of 
financing for, and the objectives of, each anticipated expenditure of 
more than $600,000 for items that would under generally accepted 
accounting principles, be considered capital items. In determining if a 
single capital expenditure exceeds $600,000, the cost of studies, 
surveys, designs, plans, working drawings, specifications, and other 
activities essential to the acquisition, improvement, modernization, 
expansion, or replacement of land, plant, building, and equipment are 
included. Expenditures directly or indirectly related to capital 
expenditures, such as grading, paving, broker commissions, taxes 
assessed during the construction period, and costs involved in 
demolishing or razing structures on land are also included. Transactions 
that are separated in time, but are components of an overall plan or 
patient care objective, are viewed in their entirety without regard to 
their timing. Other costs related to capital expenditures include title 
fees, permit and license fees, broker commissions, architect, legal, 
accounting, and appraisal fees; interest, finance, or carrying charges 
on bonds, notes and other costs incurred for borrowing funds.
    (ii) If the anticipated source of financing is, in any part, the 
anticipated payment from title V (Maternal and Child Health and Crippled 
Children's Services) or title XVIII (Medicare) or title XIX (Medicaid) 
of the Social Security Act, the plan specifies the following:
    (A) Whether the proposed capital expenditure is required to comform, 
or is likely to be required to conform, to current standards, criteria, 
or plans developed in accordance with the Public Health Service Act or 
the Mental Retardation Facilities and Community Mental Health Centers 
Construction Act of 1963.
    (B) Whether a capital expenditure proposal has been submitted to the 
designated planning agency for approval in accordance with section 1122 
of the Act (42 U.S.C. 1320a-1) and implementing regulations.
    (C) Whether the designated planning agency has approved or 
disapproved the proposed capital expenditure if it was presented to that 
agency.
    (3) Preparation of plan and budget. The overall plan and budget is 
prepared under the direction of the governing body of the HHA by a 
committee consisting of representatives of the governing body, the 
administrative staff, and the medical staff (if any) of the HHA.
    (4) Annual review of plan and budget. The overall plan and budget is 
reviewed and updated at least annually by the committee referred to in 
paragraph (i)(3) of this section under the direction of the governing 
body of the HHA.
    (j) Standard: Laboratory services. (1) If the HHA engages in 
laboratory testing outside of the context of assisting an individual in 
self-administering a test with an appliance that has been cleared for 
that purpose by the FDA, such testing must be in compliance with all 
applicable requirements of part 493 of this chapter.
    (2) If the HHA chooses to refer specimens for laboratory testing to 
another laboratory, the referral laboratory must be certified in the 
appropriate

[[Page 120]]

specialties and subspecialties of services in accordance with the 
applicable requirements of part 493 of this chapter.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32973, July 18, 1991; 
56 FR 51334, Oct. 11, 1991; 57 FR 7136, Feb. 28, 1992; 66 FR 32778, June 
18, 2001]



Sec.  484.16  Condition of participation: Group of professional personnel.

    A group of professional personnel, which includes at least one 
physician and one registered nurse (preferably a public health nurse), 
and with appropriate representation from other professional disciplines, 
establishes and annually reviews the agency's policies governing scope 
of services offered, admission and discharge policies, medical 
supervision and plans of care, emergency care, clinical records, 
personnel qualifications, and program evaluation. At least one member of 
the group is neither an owner nor an employee of the agency.
    (a) Standard: Advisory and evaluation function. The group of 
professional personnel meets frequently to advise the agency on 
professional issues, to participate in the evaluation of the agency's 
program, and to assist the agency in maintaining liaison with other 
health care providers in the community and in the agency's community 
information program. The meetings are documented by dated minutes.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32974, July 18, 1991]



Sec.  484.18  Condition of participation: Acceptance of patients, plan of care, and medical supervision.

    Patients are accepted for treatment on the basis of a reasonable 
expectation that the patient's medical, nursing, and social needs can be 
met adequately by the agency in the patient's place of residence. Care 
follows a written plan of care established and periodically reviewed by 
a doctor of medicine, osteopathy, or podiatric medicine.
    (a) Standard: Plan of care. The plan of care developed in 
consultation with the agency staff covers all pertinent diagnoses, 
including mental status, types of services and equipment required, 
frequency of visits, prognosis, rehabilitation potential, functional 
limitations, activities permitted, nutritional requirements, medications 
and treatments, any safety measures to protect against injury, 
instructions for timely discharge or referral, and any other appropriate 
items. If a physician refers a patient under a plan of care that cannot 
be completed until after an evaluation visit, the physician is consulted 
to approve additions or modifications to the original plan. Orders for 
therapy services include the specific procedures and modalities to be 
used and the amount, frequency, and duration. The therapist and other 
agency personnel participate in developing the plan of care.
    (b) Standard: Periodic review of plan of care. The total plan of 
care is reviewed by the attending physician and HHA personnel as often 
as the severity of the patient's condition requires, but at least once 
every 60 days or more frequently when there is a beneficiary elected 
transfer; a significant change in condition resulting in a change in the 
case-mix assignment; or a discharge and return to the same HHA during 
the 60-day episode. Agency professional staff promptly alert the 
physician to any changes that suggest a need to alter the plan of care.
    (c) Standard: Conformance with physician orders. Drugs and 
treatments are administered by agency staff only as ordered by the 
physician with the exception of influenza and pneumococcal 
polysaccharide vaccines, which may be administered per agency policy 
developed in consultation with a physician, and after an assessment for 
contraindications. Verbal orders are put in writing and signed and dated 
with the date of receipt by the registered nurse or qualified therapist 
(as defined in Sec.  484.4 of this chapter) responsible for furnishing 
or supervising the ordered services. Verbal orders are only accepted by 
personnel authorized to do so by applicable State and Federal laws and 
regulations as well as by the HHA's internal policies.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32974, July 18, 1991; 
64 FR 3784, Jan. 25, 1999; 65 FR 41211, July 3, 2000; 67 FR 61814, Oct. 
2, 2002]

[[Page 121]]



Sec.  484.20  Condition of participation: Reporting OASIS information.

    HHAs must electronically report all OASIS data collected in 
accordance with Sec.  484.55.
    (a) Standard: Encoding and transmitting OASIS data. An HHA must 
encode and electronically transmit each completed OASIS assessment to 
the State agency or the CMS OASIS contractor, regarding each beneficiary 
with respect to which such information is required to be transmitted (as 
determined by the Secretary), within 30 days of completing the 
assessment of the beneficiary.
    (b) Standard: Accuracy of encoded OASIS data. The encoded OASIS data 
must accurately reflect the patient's status at the time of assessment.
    (c) Standard: Transmittal of OASIS data. An HHA must--
    (1) For all completed assessments, transmit OASIS data in a format 
that meets the requirements of paragraph (d) of this section.
    (2) Successfully transmit test data to the State agency or CMS OASIS 
contractor.
    (3) Transmit data using electronics communications software that 
provides a direct telephone connection from the HHA to the State agency 
or CMS OASIS contractor.
    (4) Transmit data that includes the CMS-assigned branch 
identification number, as applicable.
    (d) Standard: Data Format. The HHA must encode and transmit data 
using the software available from CMS or software that conforms to CMS 
standard electronic record layout, edit specifications, and data 
dictionary, and that includes the required OASIS data set.

[64 FR 3763, Jan. 25, 1999, as amended at 70 FR 76208, Dec. 23, 2005]



                    Subpart C_Furnishing of Services



Sec.  484.30  Condition of participation: Skilled nursing services.

    The HHA furnishes skilled nursing services by or under the 
supervision of a registered nurse and in accordance with the plan of 
care.
    (a) Standard: Duties of the registered nurse. The registered nurse 
makes the initial evaluation visit, regularly reevaluates the patient's 
nursing needs, initiates the plan of care and necessary revisions, 
furnishes those services requiring substantial and specialized nursing 
skill, initiates appropriate preventive and rehabilitative nursing 
procedures, prepares clinical and progress notes, coordinates services, 
informs the physician and other personnel of changes in the patient's 
condition and needs, counsels the patient and family in meeting nursing 
and related needs, participates in in-service programs, and supervises 
and teaches other nursing personnel.
    (b) Standard: Duties of the licensed practical nurse. The licensed 
practical nurse furnishes services in accordance with agency policies, 
prepares clinical and progress notes, assists the physician and 
registered nurse in performing specialized procedures, prepares 
equipment and materials for treatments observing aseptic technique as 
required, and assists the patient in learning appropriate self-care 
techniques.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32974, July 18, 1991]



Sec.  484.32  Condition of participation: Therapy services.

    Any therapy services offered by the HHA directly or under 
arrangement are given by a qualified therapist or by a qualified therapy 
assistant under the supervision of a qualified therapist and in 
accordance with the plan of care. The qualified therapist assists the 
physician in evaluating level of function, helps develop the plan of 
care (revising it as necessary), prepares clinical and progress notes, 
advises and consults with the family and other agency personnel, and 
participates in in-service programs.
    (a) Standard: Supervision of physical therapy assistant and 
occupational therapy assistant. Services furnished by a qualified 
physical therapy assistant or qualified occupational therapy assistant 
may be furnished under the supervision of a qualified physical or 
occupational therapist. A physical therapy assistant or occupational 
therapy assistant performs services planned, delegated, and supervised 
by the therapist, assists in preparing clinical notes and progress 
reports, and participates in

[[Page 122]]

educating the patient and family, and in in-service programs.
    (b) Standard: Supervision of speech therapy services. Speech therapy 
services are furnished only by or under supervision of a qualified 
speech pathologist or audiologist.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32974, July 18, 1991]



Sec.  484.34  Condition of participation: Medical social services.

    If the agency furnishes medical social services, those services are 
given by a qualified social worker or by a qualified social work 
assistant under the supervision of a qualified social worker, and in 
accordance with the plan of care. The social worker assists the 
physician and other team members in understanding the significant social 
and emotional factors related to the health problems, participates in 
the development of the plan of care, prepares clinical and progress 
notes, works with the family, uses appropriate community resources, 
participates in discharge planning and in-service programs, and acts as 
a consultant to other agency personnel.



Sec.  484.36  Condition of participation: Home health aide services.

    Home health aides are selected on the basis of such factors as a 
sympathetic attitude toward the care of the sick, ability to read, 
write, and carry out directions, and maturity and ability to deal 
effectively with the demands of the job. They are closely supervised to 
ensure their competence in providing care. For home health services 
furnished (either directly or through arrangements with other 
organizations) after August 14, 1990, the HHA must use individuals who 
meet the personnel qualifications specified in Sec.  484.4 for ``home 
health aide''.
    (a) Standard: Home health aide training--(1) Content and duration of 
training. The aide training program must address each of the following 
subject areas through classroom and supervised practical training 
totalling at least 75 hours, with at least 16 hours devoted to 
supervised practical training. The individual being trained must 
complete at least 16 hours of classroom training before beginning the 
supervisied practical training.
    (i) Communications skills.
    (ii) Observation, reporting and documentation of patient status and 
the care or service furnished.
    (iii) Reading and recording temperature, pulse, and respiration.
    (iv) Basic infection control procedures.
    (v) Basic elements of body functioning and changes in body function 
that must be reported to an aide's supervisor.
    (vi) Maintenance of a clean, safe, and healthy environment.
    (vii) Recognizing emergencies and knowledge of emergency procedures.
    (viii) The physical, emotional, and developmental needs of and ways 
to work with the populations served by the HHA, including the need for 
respect for the patient, his or her privacy and his or her property.
    (ix) Appropriate and safe techniques in personal hygiene and 
grooming that include--
    (A) Bed bath.
    (B) Sponge, tub, or shower bath.
    (C) Shampoo, sink, tub, or bed.
    (D) Nail and skin care.
    (E) Oral hygiene.
    (F) Toileting and elimination.
    (x) Safe transfer techniques and ambulation.
    (xi) Normal range of motion and positioning.
    (xii) Adequate nutrition and fluid intake.
    (xiii) Any other task that the HHA may choose to have the home 
health aide perform.
    ``Supervised practical training'' means training in a laboratory or 
other setting in which the trainee demonstrates knowledge while 
performing tasks on an individual under the direct supervision of a 
registered nurse or licensed practical nurse.
    (2) Conduct of training--(i) Organizations. A home health aide 
training program may be offered by any organization except an HHA that, 
within the previous 2 years has been found--
    (A) Out of compliance with requirements of this paragraph (a) or 
paragraph (b) of this section;
    (B) To permit an individual that does not meet the definition of 
``home

[[Page 123]]

health aide'' as specified in Sec.  484.4 to furnish home health aide 
services (with the exception of licensed health professionals and 
volunteers);
    (C) Has been subject to an extended (or partial extended) survey as 
a result of having been found to have furnished substandard care (or for 
other reasons at the discretion of the CMS or the State);
    (D) Has been assessed a civil monetary penalty of not less than 
$5,000 as an intermediate sanction;
    (E) Has been found to have compliance deficiencies that endanger the 
health and safety of the HHA's patients and has had a temporary 
management appointed to oversee the management of the HHA;
    (F) Has had all or part of its Medicare payments suspended; or
    (G) Under any Federal or State law within the 2-year period 
beginning on October 1, 1988--
    (1) Has had its participation in the Medicare program terminated;
    (2) Has been assessed a penalty of not less than $5,000 for 
deficiencies in Federal or State standards for HHAs;
    (3) Was subject to a suspension of Medicare payments to which it 
otherwise would have been entitled;
    (4) Had operated under a temporary management that was appointed to 
oversee the operation of the HHA and to ensure the health and safety of 
the HHA's patients; or
    (5) Was closed or had it's residents transferred by the State.
    (ii) Qualifications for instructors. The training of home health 
aides and the supervision of home health aides during the supervised 
practical portion of the training must be performed by or under the 
general supervision of a registered nurse who possesses a minimum of 2 
years of nursing experience, at least 1 year of which must be in the 
provision of home health care. Other individuals may be used to provide 
instruction under the supervision of a qualified registered nurse.
    (3) Documentation of training. The HHA must maintain sufficient 
documentation to demonstrate that the requirements of this standard are 
met.
    (b) Standard: Competency evaluation and in-service training--(1) 
Applicability. An individual may furnish home health aide services on 
behalf of an HHA only after that individual has successfully completed a 
competency evaluation program as described in this paragraph. The HHA is 
responsible for ensuring that the individuals who furnish home health 
aide services on its behalf meet the competency evaluation requirements 
of this section.
    (2) Content and frequency of evaluations and amount of in-service 
training. (i) The competency evaluation must address each of the 
subjects listed in paragraph (a)(1) (ii) through (xiii) of this section.
    (ii) The HHA must complete a performance review of each home health 
aide no less frequently than every 12 months.
    (iii) The home health aide must receive at least 12 hours of in-
service training during each 12-month period. The in-service training 
may be furnished while the aide is furnishing care to the patient.
    (3) Conduct of evaluation and training--(i) Organizations. A home 
health aide competency evaluation program may be offered by any 
organization except as specified in paragraph (a)(2)(i) of this section.
    The in-service training may be offered by any organization.
    (ii) Evaluators and instructors. The competency evaluation must be 
performed by a registered nurse. The in-service training generally must 
be supervised by a registered nurse who possesses a minimum of 2 years 
of nursing experience at least 1 year of which must be in the provision 
of home health care.
    (iii) Subject areas. The subject areas listed at paragraphs (a)(1) 
(iii), (ix), (x), and (xi) of this section must be evaluated after 
observation of the aide's performance of the tasks with a patient. The 
other subject areas in paragraph (a)(1) of this section may be evaluated 
through written examination, oral examination, or after observation of a 
home health aide with a patient.
    (4) Competency determination. (i) A home health aide is not 
considered competent in any task for which he or she is evaluated as 
``unsatisfactory''. The aide must not perform that task

[[Page 124]]

without direct supervision by a licensed nurse until after he or she 
receives training in the task for which he or she was evaluated as 
``unsatisfactory'' and passes a subsequent evaluation with 
``satisfactory''.
    (ii) A home health aide is not considered to have successfully 
passed a competency evaluation if the aide has an ``unsatisfactory'' 
rating in more than one of the required areas.
    (5) Documentation of competency evaluation. The HHA must maintain 
documentation which demonstrates that the requirements of this standard 
are met.
    (6) Effective date. The HHA must implement a competency evaluation 
program that meets the requirements of this paragraph before February 
14, 1990. The HHA must provide the preparation necessary for the 
individual to successfully complete the competency evaluation program. 
After August 14, 1990, the HHA may use only those aides that have been 
found to be competent in accordance with Sec.  484.36(b).
    (c) Standard: Assignment and duties of the home health aide--(1) 
Assignment. The home health aide is assigned to a specific patient by 
the registered nurse. Written patient care instructions for the home 
health aide must be prepared by the registered nurse or other 
appropriate professional who is responsible for the supervision of the 
home health aide under paragraph (d) of this section.
    (2) Duties. The home health aide provides services that are ordered 
by the physician in the plan of care and that the aide is permitted to 
perform under State law. The duties of a home health aide include the 
provision of hands-on personal care, performance of simple procedures as 
an extension of therapy or nursing services, assistance in ambulation or 
exercises, and assistance in administering medications that are 
ordinarily self-administered. Any home health aide services offered by 
an HHA must be provided by a qualified home health aide.
    (d) Standard: Supervision. (1) If the patient receives skilled 
nursing care, the registered nurse must perform the supervisory visit 
required by paragraph (d)(2) of this section. If the patient is not 
receiving skilled nursing care, but is receiving another skilled service 
(that is, physical therapy, occupational therapy, or speech-language 
pathology services), supervision may be provided by the appropriate 
therapist.
    (2) The registered nurse (or another professional described in 
paragraph (d)(1) of this section) must make an on-site visit to the 
patient's home no less frequently than every 2 weeks.
    (3) If home health aide services are provided to a patient who is 
not receiving skilled nursing care, physical or occupational therapy or 
speech-language pathology services, the registered nurse must make a 
supervisory visit to the patient's home no less frequently than every 60 
days. In these cases, to ensure that the aide is properly caring for the 
patient, each supervisory visit must occur while the home health aide is 
providing patient care.
    (4) If home health aide services are provided by an individual who 
is not employed directly by the HHA (or hospice), the services of the 
home health aide must be provided under arrangements, as defined in 
section 1861(w)(1) of the Act. If the HHA (or hospice) chooses to 
provide home health aide services under arrangements with another 
organization, the HHA's (or hospice's) responsibilities include, but are 
not limited to--
    (i) Ensuring the overall quality of the care provided by the aide;
    (ii) Supervision of the aide's services as described in paragraphs 
(d)(1) and (d)(2) of this section; and
    (iii) Ensuring that home health aides providing services under 
arrangements have met the training requirements of paragraphs (a) and 
(b) of this section.
    (e) Personal care attendant: Evaluation requirements--(1) 
Applicability. This paragraph applies to individuals who are employed by 
HHAs exclusively to furnish personal care attendant services under a 
Medicaid personal care benefit.
    (2) Rule. An individual may furnish personal care services, as 
defined in Sec.  440.170 of this chapter, on behalf of an HHA after the 
individual has been found competent by the State to furnish those 
services for which a competency evaluation is required by paragraph (b) 
of this section and which the individual is required to perform. The

[[Page 125]]

individual need not be determined competent in those services listed in 
paragraph (a) of this section that the individual is not required to 
furnish.

[54 FR 33367, August 14, 1989, as amended at 56 FR 32974, July 18, 1991; 
56 FR 51334, Oct. 11, 1991; 59 FR 65498, Dec. 20, 1994; 60 FR 39123, 
Aug. 1, 1995; 66 FR 32778, June 18, 2001]



Sec.  484.38  Condition of participation: Qualifying to furnish outpatient physical therapy or speech pathology services.

    An HHA that wishes to furnish outpatient physical therapy or speech 
pathology services must meet all the pertinent conditions of this part 
and also meet the additional health and safety requirements set forth in 
Sec. Sec.  485.711, 485.713, 485.715, 485.719, 485.723, and 485.727 of 
this chapter to implement section 1861(p) of the Act.

[54 FR 33367, Aug. 14, 1989, as amended at 60 FR 2329, Jan. 9, 1995; 60 
FR 11632, Mar. 2, 1995]



Sec.  484.48  Condition of participation: Clinical records.

    A clinical record containing pertinent past and current findings in 
accordance with accepted professional standards is maintained for every 
patient receiving home health services. In addition to the plan of care, 
the record contains appropriate identifying information; name of 
physician; drug, dietary, treatment, and activity orders; signed and 
dated clinical and progress notes; copies of summary reports sent to the 
attending physician; and a discharge summary. The HHA must inform the 
attending physician of the availability of a discharge summary. The 
discharge summary must be sent to the attending physician upon request 
and must include the patient's medical and health status at discharge.
    (a) Standards: Retention of records. Clinical records are retained 
for 5 years after the month the cost report to which the records apply 
is filed with the intermediary, unless State law stipulates a longer 
period of time. Policies provide for retention even if the HHA 
discontinues operations. If a patient is transferred to another health 
facility, a copy of the record or abstract is sent with the patient.
    (b) Standards: Protection of records. Clinical record information is 
safe-guarded against loss or unauthorized use. Written procedures govern 
use and removal of records and the conditions for release of 
information. Patient's written consent is required for release of 
information not authorized by law.

[54 FR 33367, Aug. 14, 1989, as amended at 60 FR 65498, Dec. 20, 1994]



Sec.  484.52  Condition of participation: Evaluation of the agency's program.

    The HHA has written policies requiring an overall evaluation of the 
agency's total program at least once a year by the group of professional 
personnel (or a committee of this group), HHA staff, and consumers, or 
by professional people outside the agency working in conjunction with 
consumers. The evaluation consists of an overall policy and 
administrative review and a clinical record review. The evaluation 
assesses the extent to which the agency's program is appropriate, 
adequate, effective, and efficient. Results of the evaluation are 
reported to and acted upon by those responsible for the operation of the 
agency and are maintained separately as administrative records.
    (a) Standard: Policy and administrative review. As a part of the 
evaluation process the policies and administrative practices of the 
agency are reviewed to determine the extent to which they promote 
patient care that is appropriate, adequate, effective, and efficient. 
Mechanisms are established in writing for the collection of pertinent 
data to assist in evaluation.
    (b) Standard: Clinical record review. At least quarterly, 
appropriate health professionals, representing at least the scope of the 
program, review a sample of both active and closed clinical records to 
determine whether established policies are followed in furnishing 
services directly or under arrangement. There is a continuing review of 
clinical records for each 60-day period that a patient receives home 
health services to determine adequacy of the plan of care and 
appropriateness of continuation of care.

[54 FR 33367, Aug. 14, 1989; 66 FR 32778, June 18, 2001]

[[Page 126]]



Sec.  484.55  Condition of participation: Comprehensive assessment of patients.

    Each patient must receive, and an HHA must provide, a patient-
specific, comprehensive assessment that accurately reflects the 
patient's current health status and includes information that may be 
used to demonstrate the patient's progress toward achievement of desired 
outcomes. The comprehensive assessment must identify the patient's 
continuing need for home care and meet the patient's medical, nursing, 
rehabilitative, social, and discharge planning needs. For Medicare 
beneficiaries, the HHA must verify the patient's eligibility for the 
Medicare home health benefit including homebound status, both at the 
time of the initial assessment visit and at the time of the 
comprehensive assessment. The comprehensive assessment must also 
incorporate the use of the current version of the Outcome and Assessment 
Information Set (OASIS) items, using the language and groupings of the 
OASIS items, as specified by the Secretary.
    (a) Standard: Initial assessment visit. (1) A registered nurse must 
conduct an initial assessment visit to determine the immediate care and 
support needs of the patient; and, for Medicare patients, to determine 
eligibility for the Medicare home health benefit, including homebound 
status. The initial assessment visit must be held either within 48 hours 
of referral, or within 48 hours of the patient's return home, or on the 
physician-ordered start of care date.
    (2) When rehabilitation therapy service (speech language pathology, 
physical therapy, or occupational therapy) is the only service ordered 
by the physician, and if the need for that service establishes program 
eligibility, the initial assessment visit may be made by the appropriate 
rehabilitation skilled professional.
    (b) Standard: Completion of the comprehensive assessment. (1) The 
comprehensive assessment must be completed in a timely manner, 
consistent with the patient's immediate needs, but no later than 5 
calendar days after the start of care.
    (2) Except as provided in paragraph (b)(3) of this section, a 
registered nurse must complete the comprehensive assessment and for 
Medicare patients, determine eligibility for the Medicare home health 
benefit, including homebound status.
    (3) When physical therapy, speech-language pathology, or 
occupational therapy is the only service ordered by the physician, a 
physical therapist, speech-language pathologist or occupational 
therapist may complete the comprehensive assessment, and for Medicare 
patients, determine eligibility for the Medicare home health benefit, 
including homebound status. The occupational therapist may complete the 
comprehensive assessment if the need for occupational therapy 
establishes program eligibility.
    (c) Standard: Drug regimen review. The comprehensive assessment must 
include a review of all medications the patient is currently using in 
order to identify any potential adverse effects and drug reactions, 
including ineffective drug therapy, significant side effects, 
significant drug interactions, duplicate drug therapy, and noncompliance 
with drug therapy.
    (d) Standard: Update of the comprehensive assessment. The 
comprehensive assessment must be updated and revised (including the 
administration of the OASIS) as frequently as the patient's condition 
warrants due to a major decline or improvement in the patient's health 
status, but not less frequently than--
    (1) The last five days of every 60 days beginning with the start-of-
care date, unless there is a--
    (i) Beneficiary elected transfer;
    (ii) Significant change in condition resulting in a new case-mix 
assignment; or
    (iii) Discharge and return to the same HHA during the 60-day 
episode.
    (2) Within 48 hours of the patient's return to the home from a 
hospital admission of 24 hours or more for any reason other than 
diagnostic tests;
    (3) At discharge.
    (e) Standard: Incorporation of OASIS data items. The OASIS data 
items determined by the Secretary must be incorporated into the HHA's 
own assessment and must include: clinical record

[[Page 127]]

items, demographics and patient history, living arrangements, supportive 
assistance, sensory status, integumentary status, respiratory status, 
elimination status, neuro/emotional/behavioral status, activities of 
daily living, medications, equipment management, emergent care, and data 
items collected at inpatient facility admission or discharge only.

[64 FR 3784, Jan. 25, 1999, as amended at 65 FR 41211, July 3, 2000]

Subpart D [Reserved]



      Subpart E_Prospective Payment System for Home Health Agencies

    Source: 65 FR 41212, July 3, 2000, unless otherwise noted.



Sec.  484.200  Basis and scope.

    (a) Basis. This subpart implements section 1895 of the Act, which 
provides for the implementation of a prospective payment system (PPS) 
for HHAs for portions of cost reporting periods occurring on or after 
October 1, 2000.
    (b) Scope. This subpart sets forth the framework for the HHA PPS, 
including the methodology used for the development of the payment rates, 
associated adjustments, and related rules.



Sec.  484.202  Definitions.

    As used in this subpart--
    Case-mix index means a scale that measures the relative difference 
in resource intensity among different groups in the clinical model.
    Discipline means one of the six home health disciplines covered 
under the Medicare home health benefit (skilled nursing services, home 
health aide services, physical therapy services, occupational therapy 
services, speech- language pathology services, and medical social 
services).
    Home health market basket index means an index that reflects changes 
over time in the prices of an appropriate mix of goods and services 
included in home health services.
    Rural area means, with respect to home health episodes ending on or 
after January 1, 2006, an area defined in Sec.  412.64(b)(1)(ii)(C) of 
this chapter.
    Urban area means, with respect to home health episodes ending on or 
after January 1, 2006, an area defined in Sec.  412.64(b)(1)(ii)(A) and 
(B) of this chapter.

[70 FR 68142, Nov. 9, 2005]



Sec.  484.205  Basis of payment.

    (a) Method of payment. An HHA receives a national prospective 60-day 
episode payment of a predetermined rate for a home health service 
previously paid on a reasonable cost basis (except the osteoporosis drug 
defined in section 1861(kk) of the Act) as of August 5, 1997. The 
national 60-day episode payment is determined in accordance with Sec.  
484.215. The national prospective 60-day episode payment is subject to 
the following adjustments and additional payments:
    (1) A low-utilization payment adjustment (LUPA) of a predetermined 
per-visit rate as specified in Sec.  484.230.
    (2) A partial episode payment (PEP) adjustment due to an intervening 
event defined as a beneficiary elected transfer or a discharge and 
return to the same HHA during the 60-day episode, that warrants a new 
60-day episode payment during an existing 60-day episode, that initiates 
the start of a new 60-day episode payment and a new physician 
certification of the new plan of care. The PEP adjustment is determined 
in accordance with Sec.  484.235.
    (3) An outlier payment is determined in accordance with Sec.  
484.240.
    (b) Episode payment. The national prospective 60-day episode payment 
represents payment in full for all costs associated with furnishing home 
health services previously paid on a reasonable cost basis (except the 
osteoporosis drug listed in section 1861(m) of the Act as defined in 
section 1861(kk) of the Act) as of August 5, 1997 unless the national 
60-day episode payment is subject to a low-utilization payment 
adjustment set forth in Sec.  484.230, a partial episode payment 
adjustment set forth at Sec.  484.235, or an additional outlier payment 
set forth in Sec.  484.240. All payments under this system may be 
subject to a medical review adjustment reflecting beneficiary 
eligibility, medical necessity determinations, and HHRG assignment. DME 
provided as a home health service as defined in section

[[Page 128]]

1861(m) of the Act continues to be paid the fee schedule amount.
    (1) Split percentage payment for initial episodes. The initial 
percentage payment for initial episodes is paid to an HHA at 60 percent 
of the case-mix and wage adjusted 60-day episode rate. The residual 
final payment for initial episodes is paid at 40 percent of the case-mix 
and wage adjusted 60-day episode rate. Split percentage payments are 
made in accordance with requirements at Sec.  409.43(c) of this chapter.
    (2) Split percentage payment for subsequent episodes. The initial 
percentage payment for subsequent episodes is paid to an HHA at 50 
percent of the case-mix and wage adjusted 60-day episode rate. The 
residual final payment for subsequent episodes is paid at 50 percent of 
the case-mix and wage adjusted 60-day episode rate. Split percentage 
payments are made in accordance with requirements at Sec.  409.43(c) of 
this chapter.
    (c) Low-utilization payment. An HHA receives a national 60-day 
episode payment of a predetermined rate for home health services 
previously paid on a reasonable cost basis as of August 5, 1997, unless 
CMS determines at the end of the 60-day episode that the HHA furnished 
minimal services to a patient during the 60-day episode. A low- 
utilization payment adjustment is determined in accordance with Sec.  
484.230.
    (d) Partial episode payment adjustment. An HHA receives a national 
60-day episode payment of a predetermined rate for home health services 
previously paid on a reasonable cost basis as of August 5, 1997, unless 
CMS determines an intervening event, defined as a beneficiary elected 
transfer, or discharge and return to the same HHA during a 60-day 
episode, warrants a new 60-day episode payment. The PEP adjustment would 
not apply in situations of transfers among HHAs of common ownership as 
defined in Sec.  424.22 of this chapter. Those situations would be 
considered services provided under arrangement on behalf of the 
originating HHA by the receiving HHA with the common ownership interest 
for the balance of the 60-day episode. The common ownership exception to 
the transfer PEP adjustment does not apply if the beneficiary moves to a 
different MSA or Non-MSA during the 60-day episode before the transfer 
to the receiving HHA. The transferring HHA in situations of common 
ownership not only serves as a billing agent, but must also exercise 
professional responsibility over the arranged-for services in order for 
services provided under arrangements to be paid. The discharge and 
return to the same HHA during the 60-day episode is only recognized in 
those circumstances when a beneficiary reached the goals in the original 
plan of care. The original plan of care must have been terminated with 
no anticipated need for additional home health services for the balance 
of the 60-day episode. If the intervening event warrants a new 60-day 
episode payment and the new physician certification of a new plan of 
care, the initial HHA receives a partial episode payment adjustment 
reflecting the length of time the patient remained under its care. A 
partial episode payment adjustment is determined in accordance with 
Sec.  484.235.
    (e) Outlier payment. An HHA receives a national 60-day episode 
payment of a predetermined rate for a home health service paid on a 
reasonable cost basis as of August 5, 1997, unless the imputed cost of 
the 60-day episode exceeds a threshold amount. The outlier payment is 
defined to be a proportion of the imputed costs beyond the threshold. An 
outlier payment is a payment in addition to the national 60-day episode 
payment. The total of all outlier payments is limited to 5 percent of 
total outlays under the HHA PPS. An outlier payment is determined in 
accordance with Sec.  484.240.

[65 FR 41212, July 3, 2000, as amended at 72 FR 49878]



Sec.  484.210  Data used for the calculation of the national prospective 60-day episode payment.

    To calculate the national prospective 60-day episode payment, CMS 
uses the following:
    (a) Medicare cost data on the most recent audited cost report data 
available.
    (b) Utilization data based on Medicare claims.
    (c) An appropriate wage index to adjust for area wage differences.

[[Page 129]]

    (d) The most recent projections of increases in costs from the HHA 
market basket index.
    (e) OASIS assessment data and other data that account for the 
relative resource utilization for different HHA Medicare patient case-
mix.



Sec.  484.215  Initial establishment of the calculation of the national 60-day episode payment.

    (a) Determining an HHA's costs. In calculating the initial 
unadjusted national 60-day episode payment applicable for a service 
furnished by an HHA using data on the most recent available audited cost 
reports, CMS determines each HHA's costs by summing its allowable costs 
for the period. CMS determines the national mean cost per visit.
    (b) Determining HHA utilization. In calculating the initial 
unadjusted national 60-day episode payment, CMS determines the national 
mean utilization for each of the six disciplines using home health 
claims data.
    (c) Use of the market basket index. CMS uses the HHA market basket 
index to adjust the HHA cost data to reflect cost increases occurring 
between October 1, 1996 through September 30, 2001.
    (d) Calculation of the unadjusted national average prospective 
payment amount for the 60-day episode. CMS calculates the unadjusted 
national 60-day episode payment in the following manner:
    (1) By computing the mean national cost per visit.
    (2) By computing the national mean utilization for each discipline.
    (3) By multiplying the mean national cost per visit by the national 
mean utilization summed in the aggregate for the six disciplines.
    (4) By adding to the amount derived in paragraph (d)(3) of this 
section, amounts for nonroutine medical supplies, an OASIS adjustment 
for estimated ongoing reporting costs, an OASIS adjustment for the one 
time implementation costs associated with assessment scheduling form 
changes and amounts for Part B therapies that could have been unbundled 
to Part B prior to October 1, 2000. The resulting amount is the 
unadjusted national 60-day episode rate.
    (e) Standardization of the data for variation in area wage levels 
and case-mix. CMS standardizes--
    (1) The cost data described in paragraph (a) of this section to 
remove the effects of geographic variation in wage levels and variation 
in case-mix;
    (2) The cost data for geographic variation in wage levels using the 
hospital wage index; and
    (3) The cost data for HHA variation in case-mix using the case-mix 
indices and other data that indicate HHA case-mix.



Sec.  484.220  Calculation of the adjusted national prospective 60-day episode payment rate for case-mix and area wage levels.

    CMS adjusts the national prospective 60-day episode payment rate to 
account for the following:
    (a) HHA case-mix using a case-mix index to explain the relative 
resource utilization of different patients. To address changes to the 
case-mix that are a result of changes in the coding or classification of 
different units of service that do not reflect real changes in case-mix, 
the national prospective 60-day episode payment rate will be adjusted 
downward as follows:
    (1) For CY 2008, the adjustment is 2.75 percent.
    (2) For CY 2009 and CY 2010, the adjustment is 2.75 percent in each 
year.
    (3) For CY 2011, the adjustment is 2.71 percent.
    (b) Geographic differences in wage levels using an appropriate wage 
index based on the site of service of the beneficiary.

[72 FR 49879, Aug. 29, 2007]



Sec.  484.225  Annual update of the unadjusted national prospective 60-day episode payment rate.

    (a) CMS updates the unadjusted national 60-day episode payment rate 
on a fiscal year basis.
    (b) For fiscal year 2001, the unadjusted national 60-day episode 
payment rate is adjusted using the latest available home health market 
basket index factors.
    (c) For fiscal years 2002 and 2003, the unadjusted national 
prospective 60-day episode payment rate is updated by a factor equal to 
the applicable home

[[Page 130]]

health market basket minus 1.1 percentage points.
    (d) For the last calendar quarter of 2003 and the first calendar 
quarter of 2004, the unadjusted national prospective 60-day episode 
payment rate is equal to the rate from the previous fiscal year (FY 
2003) increased by the applicable home health market basket index 
amount.
    (e) For the last the 3 calendar quarters of 2004, the unadjusted 
national prospective 60-day episode payment rate is equal to the rate 
from the previous fiscal year (FY 2003) increased by the applicable home 
health market basket minus 0.8 percentage points.
    (f) For calendar year 2005, the unadjusted national prospective 60-
day episode payment rate is equal to the rate from the previous calendar 
year, increased by the applicable home health market basket minus 0.8 
percentage points.
    (g) For calendar year 2006, the unadjusted national prospective 60-
day episode payment rate is equal to the rate from calendar year 2005.
    (h) For 2007 and subsequent calendar years, in the case of a home 
health agency that submits home health quality data, as specified by the 
Secretary, the unadjusted national prospective 60-day episode rate is 
equal to the rate for the previous calendar year increased by the 
applicable home health market basket index amount.
    (i) For 2007 and subsequent calendar years, in the case of a home 
health agency that does not submit home health quality data, as 
specified by the Secretary, the unadjusted national prospective 60-day 
episode rate is equal to the rate for the previous calendar year 
increased by the applicable home health market basket index amount minus 
2 percentage points. Any reduction of the percentage change will apply 
only to the calendar year involved and will not be taken into account in 
computing the prospective payment amount for a subsequent calendar year.

[65 FR 41212, July 3, 2000, as amended at 69 FR 62138, Oct. 22, 2004; 71 
FR 65935, Nov. 9, 2006]



Sec.  484.230  Methodology used for the calculation of the low-utilization payment adjustment.

    An episode with four or fewer visits is paid the national per-visit 
amount by discipline updated annually by the applicable market basket 
for each visit type. The national per-visit amount is determined by 
using cost data set forth in Sec.  484.210(a) and adjusting by the 
appropriate wage index based on the site of service for the beneficiary. 
For 2008 and subsequent calendar years, an amount will be added to low-
utilization payment adjustments for low-utilization episodes that occur 
as the beneficiary's only episode or initial episode in a sequence of 
adjacent episodes. For purposes of the home health PPS, a sequence of 
adjacent episodes for a beneficiary is a series of claims with no more 
than 60 days without home care between the end of one episode, which is 
the 60th day (except for episodes that have been PEP-adjusted), and the 
beginning of the next episode. This additional amount will be updated 
annually after 2008 by a factor equal to the applicable home health 
market basket percentage.

[65 FR 41212, July 3, 2000, as amended at 72 FR 69879, Aug. 29, 2007]



Sec.  484.235  Methodology used for the calculation of the partial episode payment adjustment.

    (a) CMS makes a PEP adjustment to the original 60-day episode 
payment that is interrupted by an intervening event described in Sec.  
484.205(d).
    (b) The original 60-day episode payment is adjusted to reflect the 
length of time the beneficiary remained under the care of the original 
HHA based on the first billable visit date through and including the 
last billable visit date.
    (c) The partial episode payment is calculated by determining the 
actual days served by the original HHA as a proportion of 60 multiplied 
by the initial 60-day episode payment.



Sec.  484.240  Methodology used for the calculation of the outlier payment.

    (a) CMS makes an outlier payment for an episode whose estimated cost 
exceeds a threshold amount for each case-mix group.

[[Page 131]]

    (b) The outlier threshold for each case-mix group is the episode 
payment amount for that group, the PEP adjustment amount for the episode 
plus a fixed dollar loss amount that is the same for all case-mix 
groups.
    (c) The outlier payment is a proportion of the amount of estimated 
cost beyond the threshold.
    (d) CMS imputes the cost for each episode by multiplying the 
national per-visit amount of each discipline by the number of visits in 
the discipline and computing the total imputed cost for all disciplines.
    (e) The fixed dollar loss amount and the loss sharing proportion are 
chosen so that the estimated total outlier payment is no more than 5 
percent of total payment under home health PPS.

[65 FR 41212, July 3, 2000, as amended at 72 FR 69879, Aug. 29, 2007]



Sec.  484.245  Accelerated payments for home health agencies.

    (a) General rule. Upon request, an accelerated payment may be made 
to an HHA that is receiving payment under the home health prospective 
payment system if the HHA is experiencing financial difficulties because 
there is a delay by the intermediary in making payment to the HHA.
    (b) Approval of payment. An HHA's request for an accelerated payment 
must be approved by the intermediary and CMS.
    (c) Amount of payment. The amount of the accelerated payment is 
computed as a percentage of the net payment for unbilled or unpaid 
covered services.
    (d) Recovery of payment. Recovery of the accelerated payment is made 
by recoupment as HHA bills are processed or by direct payment by the 
HHA.



Sec.  484.250  Patient assessment data.

    An HHA must submit to CMS the OASIS data described at Sec.  
484.55(b)(1) and (d)(1) in order for CMS to administer the payment rate 
methodologies described in Sec. Sec.  484.215, 484.230, 484.235, and 
484.237.



Sec.  484.260  Limitation on review.

    An HHA is not entitled to judicial or administrative review under 
sections 1869 or 1878 of the Act, or otherwise, with regard to the 
establishment of the payment unit, including the national 60-day 
prospective episode payment rate, adjustments and outlier payments. An 
HHA is not entitled to the review regarding the establishment of the 
transition period, definition and application of the unit of payments, 
the computation of initial standard prospective payment amounts, the 
establishment of the adjustment for outliers, and the establishment of 
case-mix and area wage adjustment factors.



Sec.  484.265  Additional payment.

    QIO photocopy and mailing costs. An additional payment is made to a 
home health agency in accordance with Sec.  476.78 of this chapter for 
the costs of photocopying and mailing medical records requested by a 
QIO.

[68 FR 67960, Dec. 5, 2003]



PART 485_CONDITIONS OF PARTICIPATION: SPECIALIZED PROVIDERS--Table of Contents




Subpart A [Reserved]

    Subpart B_Conditions of Participation: Comprehensive Outpatient 
                        Rehabilitation Facilities

Sec.
485.50 Basis and scope.
485.51 Definition.
485.54 Condition of participation: Compliance with State and local laws.
485.56 Condition of participation: Governing body and administration.
485.58 Condition of participation: Comprehensive rehabilitation program.
485.60 Condition of participation: Clinical records.
485.62 Condition of participation: Physical environment.
485.64 Condition of participation: Disaster procedures.
485.66 Condition of participation: Utilization review plan.
485.70 Personnel qualifications.
485.74 Appeal rights.

Subparts C-E [Reserved]

 Subpart F_Conditions of Participation: Critical Access Hospitals (CAHs)

485.601 Basis and scope.
485.602 Definitions.
485.603 Rural health network.
485.604 Personnel qualifications.

[[Page 132]]

485.606 Designation and certification of CAHs.
485.608 Condition of participation: Compliance with Federal, State, and 
          local laws and regulations.
485.610 Condition of participation: Status and location.
485.612 Condition of participation: Compliance with hospital 
          requirements at the time of application.
485.616 Condition of participation: Agreements.
485.618 Condition of participation: Emergency services.
485.620 Condition of participation: Number of beds and length of stay.
485.623 Condition of participation: Physical plant and environment.
485.627 Condition of participation: Organizational structure.
485.631 Condition of participation: Staffing and staff responsibilities.
485.635 Condition of participation: Provision of services.
485.638 Condition of participation: Clinical records.
485.639 Condition of participation: Surgical services.
485.641 Condition of participation: Periodic evaluation and quality 
          assurance review.
485.643 Condition of participation: Organ, tissue, and eye procurement.
485.645 Special requirements for CAH providers of long-term care 
          services (``swing-beds'').
485.647 Condition of participation: psychiatric and rehabilitation 
          distinct part units.

Subpart G [Reserved]

   Subpart H_Conditions of Participation for Clinics, Rehabilitation 
Agencies, and Public Health Agencies as Providers of Outpatient Physical 
             Therapy and Speech-Language Pathology Services

485.701 Basis and scope.
485.703 Definitions.
485.705 Personnel qualifications.
485.707 Condition of participation: Compliance with Federal, State, and 
          local laws.
485.709 Condition of participation: Administrative management.
485.711 Condition of participation: Plan of care and physician 
          involvement.
485.713 Condition of participation: Physical therapy services.
485.715 Condition of participation: Speech pathology services.
485.717 Condition of participation: Rehabilitation program.
485.719 Condition of participation: Arrangements for physical therapy 
          and speech pathology services to be performed by other than 
          salaried organization personnel.
485.721 Condition of participation: Clinical records.
485.723 Condition of participation: Physical environment.
485.725 Condition of participation: Infection control.
485.727 Condition of participation: Disaster preparedness.
485.729 Condition of participation: Program evaluation.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395(hh)).

    Source: 48 FR 56293, Dec. 15, 1982, unless otherwise noted. 
Redesignated at 50 FR 33034, Aug. 16, 1985.

Subpart A [Reserved]



    Subpart B_Conditions of Participation: Comprehensive Outpatient 
                        Rehabilitation Facilities



Sec.  485.50  Basis and scope.

    This subpart sets forth the conditions that facilities must meet to 
be certified as comprehensive outpatient rehabilitation facilities 
(CORFs) under section 1861(cc)(2) of the Social Security Act and be 
accepted for participation in Medicare in accordance with part 489 of 
this chapter.



Sec.  485.51  Definition.

    As used in this subpart, unless the context indicates otherwise, 
``comprehensive outpatient rehabilitation facility'', ``CORF'', or 
``facility'' means a nonresidential facility that--
    (a) Is established and operated exclusively for the purpose of 
providing diagnostic, therapeutic, and restorative services to 
outpatients for the rehabilitation of injured, disabled, or sick 
persons, at a single fixed location, by or under the supervision of a 
physician except as provided in paragraph (c) of this section;
    (b) Meets all the requirements of this subpart.
    (c) Exception. May provide influenza, pneumococcal and Hepatitis B 
vaccines provided the applicable conditions of coverage under Sec.  
410.58 and Sec.  410.63 of this chapter are met.

[48 FR 56293, Dec. 15, 1982, as amended at 72 FR 66408, Nov. 27, 2007]

[[Page 133]]



Sec.  485.54  Condition of participation: Compliance with State and local laws.

    The facility and all personnel who provide services must be in 
compliance with applicable State and local laws and regulations.
    (a) Standard: Licensure of facility. If State or local law provides 
for licensing, the facility must be currently licensed or approved as 
meeting the standards established for licensure.
    (b) Standard: Licensure of personnel. Personnel that provide service 
must be licensed, certified, or registered in accordance with applicable 
State and local laws.



Sec.  485.56  Condition of participation: Governing body and administration.

    The facility must have a governing body that assumes full legal 
responsibility for establishing and implementing policies regarding the 
management and operation of the facility.
    (a) Standard: Disclosure of ownership. The facility must comply with 
the provisions of part 420, subpart C of this chapter that require 
health care providers and fiscal agents to disclose certain information 
about ownership and control.
    (b) Standard: Administrator. The governing body must appoint an 
administrator who--
    (1) Is responsible for the overall management of the facility under 
the authority delegated by the governing body;
    (2) Implements and enforces the facility's policies and procedures;
    (3) Designates, in writing, an individual who, in the absence of the 
administrator, acts on behalf of the administrator; and
    (4) Retains professional and administrative responsibility for all 
personnel providing facility services.
    (c) Standard: Group of professional personnel. The facility must 
have a group of professional personnel associated with the facility 
that--
    (1) Develops and periodically reviews policies to govern the 
services provided by the facility; and
    (2) Consists of at least one physician and one professional 
representing each of the services provided by the facility.
    (d) Standard: Institutional budget plan. The facility must have an 
institutional budget plan that meets the following conditions:
    (1) It is prepared, under the direction of the governing body, by a 
committee consisting of representatives of the governing body and the 
administrative staff.
    (2) It provides for--
    (i) An annual operating budget prepared according to generally 
accepted accounting principles;
    (ii) A 3-year capital expenditure plan if expenditures in excess of 
$100,000 are anticipated, for that period, for the acquisition of land; 
the improvement of land, buildings, and equipment; and the replacement, 
modernization, and expansion of buildings and equipment; and
    (iii) Annual review and updating by the governing body.
    (e) Standard: Patient care policies. The facility must have written 
patient care policies that govern the services it furnishes. The patient 
care policies must include the following:
    (1) A description of the services the facility furnishes through 
employees and those furnished under arrangements.
    (2) Rules for and personnel responsibilities in handling medical 
emergencies.
    (3) Rules for the storage, handling, and administration of drugs and 
biologicals.
    (4) Criteria for patient admission, continuing care, and discharge.
    (5) Procedures for preparing and maintaining clinical records on all 
patients.
    (6) A procedure for explaining to the patient and the patient's 
family the extent and purpose of the services to be provided.
    (7) A procedure to assist the referring physician in locating 
another level of care for--patients whose treatment has terminated and 
who are discharged.
    (8) A requirement that patients accepted by the facility must be 
under the care of a physician.
    (9) A requirement that there be a plan of treatment established by a 
physician for each patient.
    (10) A procedure to ensure that the group of professional personnel 
reviews

[[Page 134]]

and takes appropriate action on recommendations from the utilization 
review committee regarding patient care policies.
    (f) Standard: Delegation of authority. The responsibility for 
overall administration, management, and operation must be retained by 
the facility itself and not delegated to others.
    (1) The facility may enter into a contract for purposes of 
assistance in financial management and may delegate to others the 
following and similar services:
    (i) Bookkeeping.
    (ii) Assistance in the development of procedures for billing and 
accounting systems.
    (iii) Assistance in the development of an operating budget.
    (iv) Purchase of supplies in bulk form.
    (v) The preparation of financial statements.
    (2) When the services listed in paragraph (f)(1) of this section are 
delegated, a contract must be in effect and:
    (i) May not be for a term of more than 5 years;
    (ii) Must be subject to termination within 60 days of written notice 
by either party;
    (iii) Must contain a clause requiring renegotiation of any provision 
that CMS finds to be in contravention to any new, revised or amended 
Federal regulation or law;
    (iv) Must state that only the facility may bill the Medicare 
program; and
    (v) May not include clauses that state or imply that the contractor 
has power and authority to act on behalf of the facility, or clauses 
that give the contractor rights, duties, discretions, or 
responsibilities that enable it to dictate the administration, 
mangement, or operations of the facility.



Sec.  485.58  Condition of participation: Comprehensive rehabilitation program.

    The facility must provide a coordinated rehabilitation program that 
includes, at a minimum, physicians' services, physical therapy services, 
and social or psychological services. These services must be furnished 
by personnel that meet the qualifications set forth in Sec. Sec.  485.70 
and 484.4 of this chapter and must be consistent with the plan of 
treatment and the results of comprehensive patient assessments.
    (a) Standard: Physician services. (1) A facility physician must be 
present in the facility for a sufficient time to--
    (i) Provide, in accordance with accepted principles of medical 
practice, medical direction, medical care services, consultation, and 
medical supervision of nonphysician staff;
    (ii) Establish the plan of treatment in cases where a plan has not 
been established by the referring physician;
    (iii) Assist in establishing and implementing the facility's patient 
care policies; and
    (iv) Participate in plan of treatment reviews, patient case review 
conferences, comprehensive patient assessment and reassessments, and 
utilization review.
    (2) The facility must provide for emergency physician services 
during the facility operating hours.
    (b) Standard: Plan of treatment. For each patient, a physician must 
establish a plan of treatment before the facility initiates treatment. 
The plan of treatment must meet the following requirements:
    (1) It must delineate anticipated goals and specify the type, 
amount, frequency and duration of services to be provided.
    (2) It must be promptly evaluated after changes in the patient's 
condition and revised when necessary.
    (3) It must, if appropriate, be developed in consultation with the 
facility physician and the appropriate facility professional personnel.
    (4) It must be reviewed at least every 60 days by a facility 
physician who, when appropriate, consults with the professional 
personnel providing services. The results of this review must be 
communicated to the patient's referring physician for concurrence before 
treatment is continued or discontinued.
    (5) It must be revised if the comprehensive reassessment of the 
patient's status or the results of the patient case review conference 
indicate the need for revision.
    (c) Standard: Coordination of services. The facility must designate, 
in writing, a qualified professional to ensure that

[[Page 135]]

professional personnel coordinate their related activities and exchange 
information about each patient under their care. Mechanisms to assist in 
the coordination of services must include--
    (1) Providing to all personnel associated with the facility, a 
schedule indicating the frequency and type of services provided at the 
facility;
    (2) A procedure for communicating to all patient care personnel 
pertinent information concerning significant changes in the patient's 
status;
    (3) Periodic clinical record entries, noting at least the patient's 
status in relationship to goal attainment; and
    (4) Scheduling patient case review conferences for purposes of 
determining appropriateness of treatment, when indicated by the results 
of the initial comprehensive patient assessment, reassessment(s), the 
recommendation of the facility physician (or other physician who 
established the plan of treatment), or upon the recommendation of one of 
the professionals providing services.
    (d) Standard: Provision of services. (1) All patients must be 
referred to the facility by a physician who provides the following 
information to the facility before treatment is initiated:
    (i) The patient's significant medical history.
    (ii) Current medical findings.
    (iii) Diagnosis(es) and contraindications to any treatment modality.
    (iv) Rehabilitation goals, if determined.
    (2) Services may be provided by facility employees or by others 
under arrangements made by the facility.
    (3) The facility must have on its premises the necessary equipment 
to implement the plan of treatment and sufficient space to allow 
adequate care.
    (4) The services must be furnished by personnel that meet the 
qualifications of Sec.  485.70 and the number of qualified personnel 
must be adequate for the volume and diversity of services offered. 
Personnel that do not meet the qualifications specified in Sec.  485.70 
may be used by the facility in assisting qualified staff. When a 
qualified individual is assisted by these personnel, the qualified 
individual must be on the premises, and must instruct these personnel in 
appropriate patient care service techniques and retain responsibility 
for their activities.
    (5) A qualified professional must initiate and coordinate the 
appropriate portions of the plan of treatment, monitor the patient's 
progress, and recommend changes, in the plan, if necessary.
    (6) A qualified professional representing each service made 
available at the facility must be either on the premises of the facility 
or must be available through direct telecommunication for consultation 
and assistance during the facility's operating hours. At least one 
qualified professional must be on the premises during the facility's 
operating hours.
    (7) All services must be provided consistent with accepted 
professional standards and practice.
    (e) Standard: Scope and site of services--(1) Basic requirements. 
The facility must provide all the CORF services required in the plan of 
treatment and, except as provided in paragraph (e)(2) of this section, 
must provide the services on its premises.
    (2) Exceptions. Physical therapy, occupational therapy, and speech-
language pathology services may be furnished away from the premises of 
the CORF including the individual's home when payment is not otherwise 
made under Title XVIII of the Act. In addition, a single home 
environment evaluation is covered if there is a need to evaluate the 
potential impact of the home environment on the rehabilitation goals. 
The single home environment evaluation requires the presence of the 
patient and the physical therapist, occupational therapist, or speech-
language pathologist, as appropriate.
    (f) Standard: Patient assessment. Each qualified professional 
involved in the patient's care, as specified in the plan of treatment, 
must--
    (1) Carry out an initial patient assessment; and
    (2) In order to identify whether or not the current plan of 
treatment is appropriate, perform a patient reassessment after 
significant changes in the patient's status.
    (g) Standard: Laboratory services. (1) If the facility provides its 
own laboratory services, the services must meet the

[[Page 136]]

applicable requirements for laboratories specified in part 493 of this 
chapter.
    (2) If the facility chooses to refer specimens for laboratory 
testing, the referral laboratory must be certified in the appropriate 
specialties and subspecialties of services in accordance with the 
requirements of part 493 of this chapter.

[48 FR 56293, Dec. 15, 1982, as amended at 56 FR 8852, Mar. 1, 1991; 57 
FR 7137, Feb. 28, 1992; 73 FR 69941, Nov. 19, 2008]



Sec.  485.60  Condition of participation: Clinical records.

    The facility must maintain clinical records on all patients in 
accordance with accepted professional standards and practice. The 
clinical records must be completely, promptly, and accurately 
documented, readily accessible, and systematically organized to 
facilitate retrieval and compilation of information.
    (a) Standard: Content. Each clinical record must contain sufficient 
information to identify the patient clearly and to justify the diagnosis 
and treatment. Entries in the clinical record must be made as frequently 
as is necessary to insure effective treatment and must be signed by 
personnel providing services. All entries made by assistant level 
personnel must be countersigned by the corresponding professional. 
Documentation on each patient must be consolidated into one clinical 
record that must contain--
    (1) The initial assessment and subsequent reassessments of the 
patient's needs;
    (2) Current plan of treatment;
    (3) Identification data and consent or authorization forms;
    (4) Pertinent medical history, past and present;
    (5) A report of pertinent physical examinations if any;
    (6) Progress notes or other documentation that reflect patient 
reaction to treatment, tests, or injury, or the need to change the 
established plan of treatment; and
    (7) Upon discharge, a discharge summary including patient status 
relative to goal achievement, prognosis, and future treatment 
considerations.
    (b) Standard: Protection of clinical record information. The 
facility must safeguard clinical record information against loss, 
destruction, or unauthorized use. The facility must have procedures that 
govern the use and removal of records and the conditions for release of 
information. The facility must obtain the patient's written consent 
before releasing information not required to be released by law.
    (c) Standard: Retention and preservation. The facility must retain 
clinical record information for 5 years after patient discharge and must 
make provision for the maintenance of such records in the event that it 
is no longer able to treat patients.



Sec.  485.62  Condition of participation: Physical environment.

    The facility must provide a physical environment that protects the 
health and safety or patients, personnel, and the public.
    (a) Standard: Safety and comfort of patients. The physical premises 
of the facility and those areas of its surrounding physical structure 
that are used by the patients (including at least all stairwells, 
corridors and passageways) must meet the following requirements:
    (1) Applicable Federal, State, and local building, fire, and safety 
codes must be met.
    (2) Fire extinguishers must be easily accessible and fire 
regulations must be prominently posted.
    (3) A fire alarm system with local (in-house) capability must be 
functional, and where power is generated by electricity, an alternate 
power source with automatic triggering must be present.
    (4) Lights, supported by an emergency power source, must be placed 
at exits.
    (5) A sufficient number of staff to evacuate patients during a 
disaster must be on the premises of the facility whenever patients are 
being treated.
    (6) Lighting must be sufficient to carry out services safely; room 
temperature must be maintained at comfortable levels; and ventilation 
through windows, mechanical means, or a combination of both must be 
provided.

[[Page 137]]

    (7) Safe and sufficient space must be available for the scope of 
services offered.
    (b) Standard: Sanitary environment. The facility must maintain a 
sanitary environment and establish a program to identify, investigate, 
prevent, and control the cause of patient infections.
    (1) The facility must establish written policies and procedures 
designed to control and prevent infection in the facility and to 
investigate and identify possible causes of infection.
    (2) The facility must monitor the infection control program to 
ensure that the staff implement the policies and procedures and that the 
policies and procedures are consistent with current practices in the 
field.
    (3) The facility must make available at all times a quantity of 
laundered linen adequate for proper care and comfort of patients. Linens 
must be handled, stored, and processed in a mannner that prevents the 
spread of infection.
    (4) Provisions must be in effect to ensure that the facility's 
premises are maintained free of rodent and insect infestation.
    (c) Standard: Maintenance of equipment, physical location, and 
grounds. The facility must establish a written preventive maintenance 
program to ensure that--
    (1) All equipment is properly maintained and equipment needing 
periodic calibration is calibrated consistent with the manufacturer's 
recommendations; and
    (2) The interior of the facility, the exterior of the physical 
structure housing the facility, and the exterior walkways and parking 
areas are clean and orderly and maintained free of any defects that are 
a hazard to patients, personnel, and the public.
    (d) Standard: Access for the physically impaired. The facility must 
ensure the following:
    (1) Doorways, stairwells, corridors, and passageways used by 
patients are--
    (i) Of adequate width to allow for easy movement of all patients 
(including those on stretchers or in wheelchairs); and
    (ii) In the case of stairwells, equipped with firmly attached 
handrails on at least one side.
    (2) At least one toilet facility is accessible and constructed to 
allow utilization by ambulatory and nonambulatory individuals.
    (3) At least one entrance is usable by individuals in wheelchairs.
    (4) In multi-story buildings, elevators are accessible to and usable 
by the physically impaired on the level that they use to enter the 
building and all levels normally used by the patients of the facility.
    (5) Parking spaces are large enough and close enough to the facility 
to allow safe access by the physically impaired.



Sec.  485.64  Condition of participation: Disaster procedures.

    The facility must have written policies and procedures that 
specifically define the handling of patients, personnel, records, and 
the public during disasters. All personnel associated with the facility 
must be knowledgeable with respect to these procedures, be trained in 
their application, and be assigned specific responsibilities.
    (a) Standard: Disaster plan. The facility's written disaster plan 
must be developed and maintained with assistance of qualified fire, 
safety, and other appropriate experts. The plan must include--
    (1) Procedures for prompt transfer of casualties and records;
    (2) Procedures for notifying community emergency personnel (for 
example, fire department, ambulance, etc.);
    (3) Instructions regarding the location and use of alarm systems and 
signals and fire fighting equipment; and
    (4) Specification of evacuation routes and procedures for leaving 
the facility.
    (b) Standard: Drills and staff training. (1) The facility must 
provide ongoing training and drills for all personnel associated with 
the facility in all aspects of disaster preparedness.
    (2) All new personnel must be oriented and assigned specific 
responsibilities regarding the facility's disaster plan within two weeks 
of their first workday.



Sec.  485.66  Condition of participation: Utilization review plan.

    The facility must have in effect a written utilization review plan 
that is

[[Page 138]]

implemented at least each quarter, to assess the necessity of services 
and promotes the most efficient use of services provided by the 
facility.
    (a) Standard: Utilization review committee. The utilization review 
committee, consisting of the group of professional personnel specified 
in Sec.  485.56(c), a committee of this group, or a group of similar 
composition, comprised by professional personnel not associated with the 
facility, must carry out the utilization review plan.
    (b) Standard: Utilization review plan. The utilization review plan 
must contain written procedures for evaluating--
    (1) Admissions, continued care, and discharges using, at a minimum, 
the criteria established in the patient care policies;
    (2) The applicability of the plan of treatment to established goals; 
and
    (3) The adequacy of clinical records with regard to--
    (i) Assessing the quality of services provided; and
    (ii) Determining whether the facility's policies and clinical 
practices are compatible and promote appropriate and efficient 
utilization of services.



Sec.  485.70  Personnel qualifications.

    This section sets forth the qualifications that must be met, as a 
condition of participation, under Sec.  485.58, and as a condition of 
coverage of services under Sec.  410.100 of this chapter.
    (a) A facility physician must be a doctor of medicine or osteopathy 
who--
    (1) Is licensed under State law to practice medicine or surgery; and
    (2) Has had, subsequent to completing a 1-year hospital internship, 
at least 1 year of training in the medical management of patients 
requiring rehabilitation services; or
    (3) Has had at least 1 year of full-time or part-time experience in 
a rehabilitation setting providing physicians' services similar to those 
required in this subpart.
    (b) A licensed practical nurse must be licensed as a practical or 
vocational nurse by the State in which practicing, if applicable.
    (c) An occupational therapist and an occupational therapy assistant 
must meet the qualifications in Sec.  484.4 of this chapter.
    (d) An orthotist must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Have successfully completed a training program in orthotics that 
is jointly recognized by the American Council on Education and the 
American Board for Certification in Orthotics and Prosthetics; and
    (3) Be eligible to take that Board's certification examination in 
orthotics.
    (e) A physical therapist and a physical therapist assistant must 
meet the qualifications in Sec.  484.4 of this chapter.
    (f) A prosthetist must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Have successfully completed a training program in prosthetics 
that is jointly recognized by the American Council on Education and the 
American Board for Certification in Orthotics and Prosthetics; and
    (3) Be eligible to take that Board's certification examination in 
prosthetics.
    (g) A psychologist must be certified or licensed by the State in 
which he or she is practicing, if that State requires certification or 
licensing, and must hold a masters degree in psychology from and 
educational institution approved by the State in which the institution 
is located.
    (h) A registered nurse must be a graduate of an approved school of 
nursing and be licensed as a registered nurse by the State in which 
practicing, if applicable.
    (i) A rehabilitation counselor must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Hold at least a bachelor's degree; and
    (3) Be eligible to take the certification examination administered 
by the Commission on Rehabilitation Counselor Certification.
    (j) A respiratory therapist must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Have successfully completed a nationally--accredited educational 
program that confers eligibility for the National Board for Respiratory 
Care (NBRC) registry exams, and have

[[Page 139]]

passed the registry examination administered by the NBRC, or
    (3) Have equivalent training and experience as determined by the 
National Board for Respiratory Care (NBRC) and passed the registry 
examination administered by the NBRC.
    (k) A respiratory therapy technician must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Have successfully completed a training program accredited by the 
Committees on Allied Health Education and Accreditation (CAHEA) in 
collaboration with the Joint Review Committee for Respiratory Therapy 
Education; and
    (3) Either--
    (i) Be eligible to take the certification examination for 
respiratory therapy technicians administered by the National Board for 
Respiratory Therapy, Inc,; or
    (ii) Have equivalent training and experience as determined by the 
National Board for Respiratory Therapy, Inc.
    (l) A social worker must--
    (1) Be licensed by the State in which practicing, if applicable;
    (2) Hold at least a bachelor's degree from a school accredited or 
approved by the Council on Social Work Education; and
    (3) Have 1 year of social work experience in a health care setting.
    (m) A speech-language pathologist must meet the qualifications set 
forth in part 484 of this chapter.

[48 FR 56293, Dec. 15, 1982. Redesignated and amended at 50 FR 33034, 
Aug. 16, 1985; 51 FR 41352, Nov. 14, 1986; 60 FR 2327, Jan. 9, 1995; 72 
FR 66408, Nov. 27, 2007; 73 FR 69941, Nov. 19, 2008]



Sec.  485.74  Appeal rights.

    The appeal provisions set forth in part 498 of this chapter, for 
providers, are applicable to any entity that is participating or seeks 
to participate in the Medicare program as a CORF.

[48 FR 56293, Dec. 15, 1982, as amended at 52 FR 22454, June 12, 1987]

Subparts C-E [Reserved]



 Subpart F_Conditions of Participation: Critical Access Hospitals (CAHs)

    Source: 58 FR 30671, May 26, 1993, unless otherwise noted.



Sec.  485.601  Basis and scope.

    (a) Statutory basis. This subpart is based on section 1820 of the 
Act which sets forth the conditions for designating certain hospitals as 
CAHs.
    (b) Scope. This subpart sets forth the conditions that a hospital 
must meet to be designated as a CAH.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.602  Definitions.

    As used in this subpart, unless the context indicates otherwise:
    Direct services means services provided by employed staff of the 
CAH, not services provided through arrangements or agreements.

[59 FR 45403, Sept. 1, 1994, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.603  Rural health network.

    A rural health network is an organization that meets the following 
specifications:
    (a) It includes--
    (1) At least one hospital that the State has designated or plans to 
designate as a CAH; and
    (2) At least one hospital that furnishes acute care services.
    (b) The members of the organization have entered into agreements 
regarding--
    (1) Patient referral and transfer;
    (2) The development and use of communications systems, including, 
where feasible, telemetry systems and systems for electronic sharing of 
patient data; and
    (3) The provision of emergency and nonemergency transportation among 
members.
    (c) Each CAH has an agreement with respect to credentialing and 
quality assurance with at least--
    (1) One hospital that is a member of the network when applicable;
    (2) One QIO or equivalent entity; or

[[Page 140]]

    (3) One other appropriate and qualified entity identified in the 
State rural health care plan.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46035, Aug. 29, 1997; 63 
FR 26359, May 12, 1998]



Sec.  485.604  Personnel qualifications.

    Staff that furnish services in a CAH must meet the applicable 
requirements of this section.
    (a) Clinical nurse specialist. A clinical nurse specialist must be a 
person who performs the services of a clinical nurse specialist as 
authorized by the State, in accordance with State law or the State 
regulatory mechanism provided by State law.
    (b) Nurse practitioner. A nurse practitioner must be a registered 
professional nurse who is currently licensed to practice in the State, 
who meets the State's requirements governing the qualification of nurse 
practitioners, and who meets one of the following conditions:
    (1) Is currently certified as a primary care nurse practitioner by 
the American Nurses' Association or by the National Board of Pediatric 
Nurse Practitioners and Associates.
    (2) Has successfully completed a 1 academic year program that--
    (i) Prepares registered nurses to perform an expanded role in the 
delivery of primary care;
    (ii) Includes at least 4 months (in the aggregate) of classroom 
instruction and a component of supervised clinical practice; and
    (iii) Awards a degree, diploma, or certificate to persons who 
successfully complete the program.
    (3) Has successfully completed a formal educational program (for 
preparing registered nurses to perform an expanded role in the delivery 
of primary care) that does not meet the requirements of paragraph (a)(2) 
of this section, and has been performing an expanded role in the 
delivery of primary care for a total of 12 months during the 18-month 
period immediately preceding June 25, 1993.
    (c) Physician assistant. A physician assistant must be a person who 
meets the applicable State requirements governing the qualifications for 
assistants to primary care physicians, and who meets at least one of the 
following conditions:
    (1) Is currently certified by the National Commission on 
Certification of Physician Assistants to assist primary care physicians.
    (2) Has satisfactorily completed a program for preparing physician 
assistants that--
    (i) Was at least one academic year in length;
    (ii) Consisted of supervised clinical practice and at least 4 months 
(in the aggregate) of classroom instruction directed toward preparing 
students to deliver health care; and
    (iii) Was accredited by the American Medical Association's Committee 
on Allied Health Education and Accreditation.
    (3) Has satisfactorily completed a formal educational program (for 
preparing physician assistants) that does not meet the requirements of 
paragraph (c)(2) of this section and has been assisting primary care 
physicians for a total of 12 months during the 18-month period 
immediately preceding June 25, 1993.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.606  Designation and certification of CAHs.

    (a) Criteria for State designation. (1) A State that has established 
a Medicare rural hospital flexibility program described in section 
1820(c) of the Act may designate one or more facilities as CAHs if each 
facility meets the CAH conditions of participation in this subpart F.
    (2) The State must not deny any hospital that is otherwise eligible 
for designation as a CAH under this paragraph (a) solely because the 
hospital has entered into an agreement under which the hospital may 
provide posthospital SNF care as described in Sec.  482.66 of this 
chapter.
    (b) Criteria for CMS certification. CMS certifies a facility as a 
CAH if--
    (1) The facility is designated as a CAH by the State in which it is 
located and has been surveyed by the State survey agency or by CMS and 
found to meet all conditions of participation in

[[Page 141]]

this Part and all other applicable requirements for participation in 
Part 489 of this chapter.
    (2) The facility is a medical assistance facility operating in 
Montana or a rural primary care hospital designated by CMS before August 
5, 1997, and is otherwise eligible to be designated as a CAH by the 
State under the rules in this subpart.

[62 FR 46036, Aug. 29, 1997, as amended at 63 FR 26359, May 12, 1998]



Sec.  485.608  Condition of participation: Compliance with Federal, State, and local laws and regulations.

    The CAH and its staff are in compliance with applicable Federal, 
State and local laws and regulations.
    (a) Standard: Compliance with Federal laws and regulations. The CAH 
is in compliance with applicable Federal laws and regulations related to 
the health and safety of patients.
    (b) Standard: Compliance with State and local laws and regulations. 
All patient care services are furnished in accordance with applicable 
State and local laws and regulations.
    (c) Standard: Licensure of CAH. The CAH is licensed in accordance 
with applicable Federal, State and local laws and regulations.
    (d) Standard: Licensure, certification or registration of personnel. 
Staff of the CAH are licensed, certified, or registered in accordance 
with applicable Federal, State, and local laws and regulations.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.610  Condition of participation: Status and location.

    (a) Standard: Status. The facility is--
    (1) A currently participating hospital that meets all conditions of 
participation set forth in this subpart;
    (2) A recently closed facility, provided that the facility--
    (i) Was a hospital that ceased operations on or after the date that 
is 10 years before November 29, 1999; and
    (ii) Meets the criteria for designation under this subpart as of the 
effective date of its designation; or
    (3) A health clinic or a health center (as defined by the State) 
that--
    (i) Is licensed by the State as a health clinic or a health center;
    (ii) Was a hospital that was downsized to a health clinic or a 
health center; and
    (iii) As of the effective date of its designation, meets the 
criteria for designation set forth in this subpart.
    (b) Standard: Location in a rural area or treatment as rural. The 
CAH meets the requirements of either paragraph (b)(1) or (b)(2) or 
(b)(3) of this section.
    (1) The CAH meets the following requirements:
    (i) The CAH is located outside any area that is a Metropolitan 
Statistical Area, as defined by the Office of Management and Budget, or 
that has been recognized as urban under Sec.  412.64(b), excluding 
paragraph (b)(3) of this chapter;
    (ii) The CAH has not been classified as an urban hospital for 
purposes of the standardized payment amount by CMS or the Medicare 
Geographic Classification Review Board under Sec.  412.230(e) of this 
chapter, and is not among a group of hospitals that have been 
redesignated to an adjacent urban area under Sec.  412.232 of this 
chapter.
    (2) The CAH is located within a Metropolitan Statistical Area, as 
defined by the Office of Management and Budget, but is being treated as 
being located in a rural area in accordance with Sec.  412.103 of this 
chapter.
    (3) Effective for October 1, 2004 through September 30, 2006, the 
CAH does not meet the location requirements in either paragraph (b)(1) 
or (b)(2) of this section and is located in a county that, in FY 2004, 
was not part of a Metropolitan Statistical Area as defined by the Office 
of Management and Budget, but as of FY 2005 was included as part of such 
a Metropolitan Statistical Area as a result of the most recent census 
data and implementation of the new Metropolitan Statistical Area 
definitions announced by the Office of Management and Budget on June 3, 
2003.
    (4) Effective for October 1, 2009 through September 30, 2011, the 
CAH does not meet the location requirements in either paragraph (b)(1) 
or (b)(2) of this section and is located in a county that, in FY 2009, 
was not part of

[[Page 142]]

a Metropolitan Statistical Area as defined by the Office of Management 
and Budget, but, as of FY 2010, was included as part of such a 
Metropolitan Statistical Area as a result of the most recent census data 
and implementation of the new Metropolitan Statistical Area definitions 
announced by the Office of Management and Budget on November 20, 2008.
    (c) Standard: Location relative to other facilities or necessary 
provider certification. The CAH is located more than a 35-mile drive 
(or, in the case of mountainous terrain or in areas with only secondary 
roads available, a 15-mile drive) from a hospital or another CAH, or 
before January 1, 2006, the CAH is certified by the State as being a 
necessary provider of health care services to residents in the area. A 
CAH that is designated as a necessary provider on or before December 31, 
2005, will maintain its necessary provider designation after January 1, 
2006.
    (d) Standard: Relocation of CAHs with a necessary provider 
designation. A CAH that has a necessary provider designation from the 
State that was in effect prior to January 1, 2006, and relocates its 
facility after January 1, 2006, can continue to meet the location 
requirement of paragraph (c) of this section based on the necessary 
provider designation only if the relocated facility meets the 
requirements as specified in paragraph (d)(1) of this section.
    (1) If a necessary provider CAH relocates its facility and begins 
providing services in a new location, the CAH can continue to meet the 
location requirement of paragraph (c) of this section based on the 
necessary provider designation only if the CAH in its new location--
    (i) Serves at least 75 percent of the same service area that it 
served prior to its relocation;
    (ii) Provides at least 75 percent of the same services that it 
provided prior to the relocation; and
    (iii) Is staffed by 75 percent of the same staff (including medical 
staff, contracted staff, and employees) that were on staff at the 
original location.
    (2) If a CAH that has been designated as a necessary provider by the 
State begins providing services at another location after January 1, 
2006, and does not meet the requirements in paragraph (d)(1) of this 
section, the action will be considered a cessation of business as 
described in Sec.  489.52(b)(3).
    (e) Standard: Off-campus and co-location requirements for CAHs. A 
CAH may continue to meet the location requirements of paragraph (c) of 
this section only if the CAH meets the following:
    (1) If a CAH with a necessary provider designation is co-located 
(that is, it shares a campus, as defined in Sec.  413.65(a)(2) of this 
chapter, with another hospital or CAH), the necessary provider CAH can 
continue to meet the location requirement of paragraph (c) of this 
section only if the co-location arrangement was in effect before January 
1, 2008, and the type and scope of services offered by the facility co-
located with the necessary provider CAH do not change. A change of 
ownership of any of the facilities with a co-location arrangement that 
was in effect before January 1, 2008, will not be considered to be a new 
co-location arrangement.
    (2) If a CAH or a necessary provider CAH operates an off-campus 
provider-based location, excluding an RHC as defined in Sec.  
405.2401(b) of this chapter, but including a department or remote 
location, as defined in Sec.  413.65(a)(2) of this chapter, or an off-
campus distinct part psychiatric or rehabilitation unit, as defined in 
Sec.  485.647, that was created or acquired by the CAH on or after 
January 1, 2008, the CAH can continue to meet the location requirement 
of paragraph (c) of this section only if the off-campus provider-based 
location or off-campus distinct part unit is located more than a 35-mile 
drive (or, in the case of mountainous terrain or in areas with only 
secondary roads available, a 15-mile drive) from a hospital or another 
CAH.
    (3) If either a CAH or a CAH that has been designated as a necessary 
provider by the State does not meet the requirements in paragraph (e)(1) 
of this section, by co-locating with another hospital or CAH on or after 
January 1, 2008, or creates or acquires an off-campus provider-based 
location or off-campus distinct part unit on or after January 1, 2008, 
that does not meet the requirements in paragraph (e)(2) of this section, 
the CAH's provider agreement

[[Page 143]]

will be subject to termination in accordance with the provisions of 
Sec.  489.53(a)(3) of this subchapter, unless the CAH terminates the 
off-campus arrangement or the co-location arrangement, or both.

[62 FR 46036, Aug. 29, 1997, as amended at 65 FR 47052, Aug. 1, 2000; 66 
FR 39938, Aug. 1, 2001; 69 FR 49271, Aug. 11, 2004; 69 FR 60252, Oct. 7, 
2004; 70 FR 47490, Aug. 12, 2005; 71 FR 48143, Aug. 18, 2006; 72 FR 
66934, Nov. 27, 2007; 73 FR 9862, Feb. 22, 2008; 74 FR 44001, Aug. 27, 
2009]



Sec.  485.612  Condition of participation: Compliance with hospital requirements at the time of application.

    Except for recently closed facilities as described in Sec.  
485.610(a)(2), or health clinics or health centers as described in Sec.  
485.610(a)(3), the facility is a hospital that has a provider agreement 
to participate in the Medicare program as a hospital at the time the 
hospital applies for designation as a CAH.

[66 FR 32196, June 13, 2001]



Sec.  485.616  Condition of participation: Agreements.

    (a) Standard: Agreements with network hospitals. In the case of a 
CAH that is a member of a rural health network as defined in Sec.  
485.603 of this chapter, the CAH has in effect an agreement with at 
least one hospital that is a member of the network for--
    (1) Patient referral and transfer;
    (2) The development and use of communications systems of the 
network, including the network's system for the electronic sharing of 
patient data, and telemetry and medical records, if the network has in 
operation such a system; and
    (3) The provision of emergency and nonemergency transportation 
between the facility and the hospital.
    (b) Standard: Agreements for credentialing and quality assurance. 
Each CAH that is a member of a rural health network shall have an 
agreement with respect to credentialing and quality assurance with at 
least--
    (1) One hospital that is a member of the network;
    (2) One QIO or equivalent entity; or
    (3) One other appropriate and qualified entity identified in the 
State rural health care plan.

[62 FR 46036, Aug. 29, 1997]



Sec.  485.618  Condition of participation: Emergency services.

    The CAH provides emergency care necessary to meet the needs of its 
inpatients and outpatients.
    (a) Standard: Availability. Emergency services are available on a 
24-hours a day basis.
    (b) Standard: Equipment, supplies, and medication. Equipment, 
supplies, and medication used in treating emergency cases are kept at 
the CAH and are readily available for treating emergency cases. The 
items available must include the following:
    (1) Drugs and biologicals commonly used in life-saving procedures, 
including analgesics, local anesthetics, antibiotics, anticonvulsants, 
antidotes and emetics, serums and toxoids, antiarrythmics, cardiac 
glycosides, antihypertensives, diuretics, and electrolytes and 
replacement solutions.
    (2) Equipment and supplies commonly used in life-saving procedures, 
including airways, endotracheal tubes, ambu bag/valve/mask, oxygen, 
tourniquets, immobilization devices, nasogastric tubes, splints, IV 
therapy supplies, suction machine, defibrillator, cardiac monitor, chest 
tubes, and indwelling urinary catheters.
    (c) Standard: Blood and blood products. The facility provides, 
either directly or under arrangements, the following:
    (1) Services for the procurement, safekeeping, and transfusion of 
blood, including the availability of blood products needed for 
emergencies on a 24-hours a day basis.
    (2) Blood storage facilities that meet the requirements of 42 CFR 
part 493, subpart K, and are under the control and supervision of a 
pathologist or other qualified doctor of medicine or osteopathy. If 
blood banking services are provided under an arrangement, the 
arrangement is approved by the facility's medical staff and by the 
persons directly responsible for the operation of the facility.

[[Page 144]]

    (d) Standard: Personnel. (1) Except as specified in paragraph (d)(3) 
of this section, there must be a doctor of medicine or osteopathy, a 
physician assistant, a nurse practitioner, or a clinical nurse 
specialist, with training or experience in emergency care, on call and 
immediately available by telephone or radio contact, and available on 
site within the following timeframes:
    (i) Within 30 minutes, on a 24-hour a day basis, if the CAH is 
located in an area other than an area described in paragraph (d)(1)(ii) 
of this section; or
    (ii) Within 60 minutes, on a 24-hour a day basis, if all of the 
following requirements are met:
    (A) The CAH is located in an area designated as a frontier area 
(that is, an area with fewer than six residents per square mile based on 
the latest population data published by the Bureau of the Census) or in 
an area that meets the criteria for a remote location adopted by the 
State in its rural health care plan, and approved by CMS, under section 
1820(b) of the Act.
    (B) The State has determined, under criteria in its rural health 
care plan, that allowing an emergency response time longer than 30 
minutes is the only feasible method of providing emergency care to 
residents of the area served by the CAH.
    (C) The State maintains documentation showing that the response time 
of up to 60 minutes at a particular CAH it designates is justified 
because other available alternatives would increase the time needed to 
stabilize a patient in an emergency.
    (2) A registered nurse with training and experience in emergency 
care can be utilized to conduct specific medical screening examinations 
only if--
    (i) The registered nurse is on site and immediately available at the 
CAH when a patient requests medical care; and
    (ii) The nature of the patient's request for medical care is within 
the scope of practice of a registered nurse and consistent with 
applicable State laws and the CAH's bylaws or rules and regulations.
    (3) A registered nurse satisfies the personnel requirement specified 
in paragraph (d)(1) of this section for a temporary period if--
    (i) The CAH has no greater than 10 beds;
    (ii) The CAH is located in an area designated as a frontier area or 
remote location as described in paragraph (d)(1)(ii)(A) of this section;
    (iii) The State in which the CAH is located submits a letter to CMS 
signed by the Governor, following consultation on the issue of using RNs 
on a temporary basis as part of their State rural healthcare plan with 
the State Boards of Medicine and Nursing, and in accordance with State 
law, requesting that a registered nurse with training and experience in 
emergency care be included in the list of personnel specified in 
paragraph (d)(1) of this section. The letter from the Governor must 
attest that he or she has consulted with State Boards of Medicine and 
Nursing about issues related to access to and the quality of emergency 
services in the States. The letter from the Governor must also describe 
the circumstances and duration of the temporary request to include the 
registered nurses on the list of personnel specified in paragraph (d)(1) 
of this section;
    (iv) Once a Governor submits a letter, as specified in paragraph 
(d)(3)(iii) of this section, a CAH must submit documentation to the 
State survey agency demonstrating that it has been unable, due to the 
shortage of such personnel in the area, to provide adequate coverage as 
specified in this paragraph (d).
    (4) The request, as specified in paragraph (d)(3)(iii) of this 
section, and the withdrawal of the request, may be submitted to us at 
any time, and are effective upon submission.
    (e) Standard: Coordination with emergency response systems. The CAH 
must, in coordination with emergency response systems in the area, 
establish procedures under which a doctor of medicine or osteopathy is 
immediately available by telephone or radio contact on a 24-hours a day 
basis to receive emergency calls, provide information on treatment of 
emergency patients,

[[Page 145]]

and refer patients to the CAH or other appropriate locations for 
treatment.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997; 64 
FR 41544, July 30, 1999; 67 FR 80041, Dec. 31, 2002; 69 FR 49271, Aug. 
11, 2004; 71 FR 68230, Nov. 24, 2006]



Sec.  485.620  Condition of participation: Number of beds and length of stay.

    (a) Standard: Number of beds. Except as permitted for CAHs having 
distinct part units under Sec.  485.647, the CAH maintains no more than 
25 inpatient beds after January 1, 2004, that can be used for either 
inpatient or swing-bed services.
    (b) Standard: Length of stay. The CAH provides acute inpatient care 
for a period that does not exceed, on an annual average basis, 96 hours 
per patient.

[62 FR 46036, Aug. 29, 1997, as amended at 65 FR 47052, Aug. 1, 2000; 69 
FR 49271, Aug. 11, 2004; 69 FR 60252, Oct. 7, 2004]



Sec.  485.623  Condition of participation: Physical plant and environment.

    (a) Standard: Construction. The CAH is constructed, arranged, and 
maintained to ensure access to and safety of patients, and provides 
adequate space for the provision of direct services.
    (b) Standard: Maintenance. The CAH has housekeeping and preventive 
maintenance programs to ensure that--
    (1) All essential mechanical, electrical, and patient-care equipment 
is maintained in safe operating condition;
    (2) There is proper routine storage and prompt disposal of trash;
    (3) Drugs and biologicals are appropriately stored;
    (4) The premises are clean and orderly; and
    (5) There is proper ventilation, lighting, and temperature control 
in all pharmaceutical, patient care, and food preparation areas.
    (c) Standard: Emergency procedures. The CAH assures the safety of 
patients in non-medical emergencies by--
    (1) Training staff in handling emergencies, including prompt 
reporting of fires, extinguishing of fires, protection and, where 
necessary, evacuation of patients, personnel, and guests, and 
cooperation with fire fighting and disaster authorities;
    (2) Providing for emergency power and lighting in the emergency room 
and for battery lamps and flashlights in other areas;
    (3) Providing for an emergency fuel and water supply; and
    (4) Taking other appropriate measures that are consistent with the 
particular conditions of the area in which the CAH is located.
    (d) Standard: Life safety from fire. (1) Except as otherwise 
provided in this section--
    (i) The CAH must meet the applicable provisions of the 2000 edition 
of the Life Safety Code of the National Fire Protection Association. The 
Director of the Office of the Federal Register has approved the NFPA 101 
[reg] 2000 edition of the Life Safety Code, issued January 
14, 2000, for incorporation by reference in accordance with 5 U.S.C. 
552(a) and 1 CFR part 51. A copy of the Code is available for inspection 
at the CMS Information Resource Center, 7500 Security Boulevard, 
Baltimore, MD or at the National Archives and Records Administration 
(NARA). For information on the availability of this material at NARA, 
call 202-741-6030, or go to: http://www.archives.gov/federal--register/
code--of--federal--regulations/ibr--locations.html. Copies may be 
obtained from the National Fire Protection Association, 1 Batterymarch 
Park, Quincy, MA 02269. If any changes in this edition of the Code are 
incorporated by reference, CMS will publish notice in the Federal 
Register to announce the changes.
    (ii) Chapter 19.3.6.3.2, exception number 2 of the adopted edition 
of the Life Safety Code does not apply to a CAH.
    (2) If CMS finds that the State has a fire and safety code imposed 
by State law that adequately protects patients, CMS may allow the State 
survey agency to apply the State's fire and safety code instead of the 
LSC.
    (3) After consideration of State survey agency findings, CMS may 
waive specific provisions of the Life Safety Code that, if rigidly 
applied, would result in unreasonable hardship on the CAH, but only if 
the waiver does not adversely affect the health and safety of patients.

[[Page 146]]

    (4) The CAH maintains written evidence of regular inspection and 
approval by State or local fire control agencies.
    (5) Beginning March 13, 2006, a critical access hospital must be in 
compliance with Chapter 9.2.9, Emergency Lighting.
    (6) Beginning March 13, 2006, Chapter 19.3.6.3.2, exception number 2 
does not apply to critical access hospitals.
    (7) Notwithstanding any provisions of the 2000 edition of the Life 
Safety Code to the contrary, a critical access hospital may install 
alcohol-based hand rub dispensers in its facility if--
    (i) Use of alcohol-based hand rub dispensers does not conflict with 
any State or local codes that prohibit or otherwise restrict the 
placement of alcohol-based hand rub dispensers in health care 
facilities;
    (ii) The dispensers are installed in a manner that minimizes leaks 
and spills that could lead to falls;
    (iii) The dispensers are installed in a manner that adequately 
protects against inappropriate access;
    (iv) The dispensers are installed in accordance with chapter 
18.3.2.7 or chapter 19.3.2.7 of the 2000 edition of the Life Safety 
Code, as amended by NFPA Temporary Interim Amendment 00-1(101), issued 
by the Standards Council of the National Fire Protection Association on 
April 15, 2004. The Director of the Office of the Federal Register has 
approved NFPA Temporary Interim Amendment 00-1(101) for incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. A copy 
of the amendment is available for inspection at the CMS Information 
Resource Center, 7500 Security Boulevard, Baltimore, MD and at the 
Office of the Federal Register, 800 North Capitol Street NW., Suite 700, 
Washington, DC. Copies may be obtained from the National Fire Protection 
Association, 1 Batterymarch Park, Quincy, MA 02269; and
    (v) The dispensers are maintained in accordance with dispenser 
manufacturer guidelines.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46036, 46037, Aug. 29, 
1997; 68 FR 1387, Jan. 10, 2003; 69 FR 49271, Aug. 11, 2004; 70 FR 
15239, Mar. 25, 2005; 71 FR 55341, Sept. 22, 2006]



Sec.  485.627  Condition of participation: Organizational structure.

    (a) Standard: Governing body or responsible individual. The CAH has 
a governing body or an individual that assumes full legal responsibility 
for determining, implementing and monitoring policies governing the 
CAH's total operation and for ensuring that those policies are 
administered so as to provide quality health care in a safe environment.
    (b) Standard: Disclosure. The CAH discloses the names and addresses 
of--
    (1) Its owners, or those with a controlling interest in the CAH or 
in any subcontractor in which the CAH directly or indirectly has a 5 
percent or more ownership interest, in accordance with subpart C of part 
420 of this chapter;
    (2) The person principally responsible for the operation of the CAH; 
and
    (3) The person responsible for medical direction.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.631  Condition of participation: Staffing and staff responsibilities.

    (a) Standard: Staffing--(1) The CAH has a professional health care 
staff that includes one or more doctors of medicine or osteopathy, and 
may include one or more physician assistants, nurse practitioners, or 
clinical nurse specialists.
    (2) Any ancillary personnel are supervised by the professional 
staff.
    (3) The staff is sufficient to provide the services essential to the 
operation of the CAH.
    (4) A doctor of medicine or osteopathy, nurse practitioner, clinical 
nurse specialist, or physician assistant is available to furnish patient 
care services at all times the CAH operates.
    (5) A registered nurse, clinical nurse specialist, or licensed 
practical nurse is on duty whenever the CAH has one or more inpatients.
    (b) Standard: Responsibilities of the doctor of medicine or 
osteopathy. (1) The doctor of medicine or osteopathy--
    (i) Provides medical direction for the CAH's health care activities 
and consultation for, and medical supervision of, the health care staff;

[[Page 147]]

    (ii) In conjunction with the physician assistant and/or nurse 
practitioner member(s), participates in developing, executing, and 
periodically reviewing the CAH's written policies governing the services 
it furnishes.
    (iii) In conjunction with the physician assistant and/or nurse 
practitioner members, periodically reviews the CAH's patient records, 
provides medical orders, and provides medical care services to the 
patients of the CAH; and
    (iv) Periodically reviews and signs the records of all inpatients 
cared for by nurse practitioners, clinical nurse specialists, certified 
nurse midwives, or physician assistants.
    (v) Periodically, but not less than every 2 weeks, reviews and signs 
a sample of outpatient records of patients cared for by nurse 
practitioners, clinical nurse specialists, certified nurse midwives, or 
physician assistants according to the policies of the CAH and according 
to current standards of practice where State law requires record reviews 
or co-signatures, or both, by a collaborating physician.
    (vi) Is not required to review and sign outpatient records of 
patients cared for by nurse practitioners, clinical nurse specialists, 
certified nurse midwives, or physician assistants where State law does 
not require record reviews or co-signatures, or both, by a collaborating 
physician.
    (2) A doctor of medicine or osteopathy is present for sufficient 
periods of time, at least once in every 2 week period (except in 
extraordinary circumstances) to provide the medical direction, medical 
care services, consultation, and supervision described in this 
paragraph, and is available through direct radio or telephone 
communication for consultation, assistance with medical emergencies, or 
patient referral. The extraordinary circumstances are documented in the 
records of the CAH. A site visit is not required if no patients have 
been treated since the latest site visit.
    (c) Standard: Physician assistant, nurse practitioner, and clinical 
nurse specialist responsibilities. (1) The physician assistant, the 
nurse practitioner, or clinical nurse specialist members of the CAH's 
staff--
    (i) Participate in the development, execution and periodic review of 
the written policies governing the services the CAH furnishes; and
    (ii) Participate with a doctor of medicine or osteopathy in a 
periodic review of the patients' health records.
    (2) The physician assistant, nurse practitioner, or clinical nurse 
specialist performs the following functions to the extent they are not 
being performed by a doctor of medicine or osteopathy:
    (i) Provides services in accordance with the CAH's policies.
    (ii) Arranges for, or refers patients to, needed services that 
cannot be furnished at the CAH, and assures that adequate patient health 
records are maintained and transferred as required when patients are 
referred.
    (3) Whenever a patient is admitted to the CAH by a nurse 
practitioner, physician assistant, or clinical nurse specialist, a 
doctor of medicine or osteopathy on the staff of the CAH is notified of 
the admission.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997; 70 
FR 68728, Nov. 10, 2005]



Sec.  485.635  Condition of participation: Provision of services.

    (a) Standard: Patient care policies. (1) The CAH's health care 
services are furnished in accordance with appropriate written policies 
that are consistent with applicable State law.
    (2) The policies are developed with the advice of a group of 
professional personnel that includes one or more doctors of medicine or 
osteopathy and one or more physician assistants, nurse practitioners, or 
clinical nurse specialists, if they are on staff under the provisions of 
Sec.  485.631(a)(1); at least one member is not a member of the CAH 
staff.
    (3) The policies include the following: (i) A description of the 
services the CAH furnishes directly and those furnished through 
agreement or arrangement.
    (ii) Policies and procedures for emergency medical services.
    (iii) Guidelines for the medical management of health problems that 
include the conditions requiring medical consultation and/or patient 
referral,

[[Page 148]]

the maintenance of health care records, and procedures for the periodic 
review and evaluation of the services furnished by the CAH.
    (iv) Rules for the storage, handling, dispensation, and 
administration of drugs and biologicals. These rules must provide that 
there is a drug storage area that is administered in accordance with 
accepted professional principles, that current and accurate records are 
kept of the receipt and disposition of all scheduled drugs, and that 
outdated, mislabeled, or otherwise unusable drugs are not available for 
patient use.
    (v) Procedures for reporting adverse drug reactions and errors in 
the administration of drugs.
    (vi) A system for identifying, reporting, investigating and 
controlling infections and communicable diseases of patients and 
personnel.
    (vii) If the CAH furnishes inpatient services, procedures that 
ensure that the nutritional needs of inpatients are met in accordance 
with recognized dietary practices and the orders of the practitioner 
responsible for the care of the patients, and that the requirement of 
Sec.  483.25(i) is met with respect to inpatients receiving posthospital 
SNF care.
    (4) These policies are reviewed at least annually by the group of 
professional personnel required under paragraph (a)(2) of this section, 
and reviewed as necessary by the CAH.
    (b) Standard: Direct services--(1) General. The CAH staff furnishes, 
as direct services, those diagnostic and therapeutic services and 
supplies that are commonly furnished in a physician's office or at 
another entry point into the health care delivery system, such as a low 
intensity hospital outpatient department or emergency department. These 
direct services include medical history, physical examination, specimen 
collection, assessment of health status, and treatment for a variety of 
medical conditions.
    (2) Laboratory services. The CAH provides, as direct services, basic 
laboratory services essential to the immediate diagnosis and treatment 
of the patient that meet the standards imposed under section 353 of the 
Public Health Service Act (42 U.S.C. 236a). (See the laboratory 
requirements specified in part 493 of this chapter.) The services 
provided include:
    (i) Chemical examination of urine by stick or tablet method or both 
(including urine ketones);
    (ii) Hemoglobin or hematocrit;
    (iii) Blood glucose:
    (iv) Examination of stool specimens for occult blood;
    (v) Pregnancy tests; and
    (vi) Primary culturing for transmittal to a certified laboratory.
    (3) Radiology services. Radiology services furnished at the CAH are 
provided as direct services by staff qualified under State law, and do 
not expose CAH patients or staff to radiation hazards.
    (4) Emergency procedures. In accordance with the requirements of 
Sec.  485.618, the CAH provides as direct services medical emergency 
procedures as a first response to common life-threatening injuries and 
acute illness.
    (c) Standard: Services provided through agreements or arrangements. 
(1) The CAH has agreements or arrangements (as appropriate) with one or 
more providers or suppliers participating under Medicare to furnish 
other services to its patients, including--
    (i) Inpatient hospital care;
    (ii) Services of doctors of medicine or osteopathy; and
    (iii) Additional or specialized diagnostic and clinical laboratory 
services that are not available at the CAH.
    (iv) Food and other services to meet inpatients' nutritional needs 
to the extent these services are not provided directly by the CAH.
    (2) If the agreements or arrangements are not in writing, the CAH is 
able to present evidence that patients referred by the CAH are being 
accepted and treated.
    (3) The CAH maintains a list of all services furnished under 
arrangements or agreements. The list describes the nature and scope of 
the services provided.
    (4) The person principally responsible for the operation of the CAH 
under Sec.  485.627(b)(2) of this chapter is also responsible for the 
following:
    (i) Services furnished in the CAH whether or not they are furnished 
under arrangements or agreements.

[[Page 149]]

    (ii) Ensuring that a contractor of services (including one for 
shared services and joint ventures) furnishes services that enable the 
CAH to comply with all applicable conditions of participation and 
standards for the contracted services.
    (d) Standard: Nursing services. Nursing services must meet the needs 
of patients.
    (1) A registered nurse must provide (or assign to other personnel) 
the nursing care of each patient, including patients at a SNF level of 
care in a swing-bed CAH. The care must be provided in accordance with 
the patient's needs and the specialized qualifications and competence of 
the staff available.
    (2) A registered nurse or, where permitted by State law, a physician 
assistant, must supervise and evaluate the nursing care for each 
patient, including patients at a SNF level of care in a swing-bed CAH.
    (3) All drugs, biologicals, and intravenous medications must be 
administered by or under the supervision of a registered nurse, a doctor 
of medicine or osteopathy, or, where permitted by State law, a physician 
assistant, in accordance with written and signed orders, accepted 
standards of practice, and Federal and State laws.
    (4) A nursing care plan must be developed and kept current for each 
inpatient.
    (e) Standard: Rehabilitation Therapy Services. Physical therapy, 
occupational therapy, and speech-language pathology services furnished 
at the CAH, if provided, are provided by staff qualified under State 
law, and consistent with the requirements for therapy services in Sec.  
409.17 of this subpart.

[58 FR 30671, May 26, 1993; 58 FR 49935, Sept. 24, 1993, as amended at 
59 FR 45403, Sept. 1, 1994; 62 FR 46037, Aug. 29, 1997; 72 FR 66408, 
Nov. 27, 2007; 73 FR 69941, Nov. 19, 2008]



Sec.  485.638  Conditions of participation: Clinical records.

    (a) Standard: Records system--(1) The CAH maintains a clinical 
records system in accordance with written policies and procedures.
    (2) The records are legible, complete, accurately documented, 
readily accessible, and systematically organized.
    (3) A designated member of the professional staff is responsible for 
maintaining the records and for ensuring that they are completely and 
accurately documented, readily accessible, and systematically organized.
    (4) For each patient receiving health care services, the CAH 
maintains a record that includes, as applicable--
    (i) Identification and social data, evidence of properly executed 
informed consent forms, pertinent medical history, assessment of the 
health status and health care needs of the patient, and a brief summary 
of the episode, disposition, and instructions to the patient;
    (ii) Reports of physical examinations, diagnostic and laboratory 
test results, including clinical laboratory services, and consultative 
findings;
    (iii) All orders of doctors of medicine or osteopathy or other 
practitioners, reports of treatments and medications, nursing notes and 
documentation of complications, and other pertinent information 
necessary to monitor the patient's progress, such as temperature 
graphics, progress notes describing the patient's response to treatment; 
and
    (iv) Dated signatures of the doctor of medicine or osteopathy or 
other health care professional.
    (b) Standard: Protection of record information--(1) The CAH 
maintains the confidentiality of record information and provides 
safeguards against loss, destruction, or unauthorized use.
    (2) Written policies and procedures govern the use and removal of 
records from the CAH and the conditions for the release of information.
    (3) The patient's written consent is required for release of 
information not required by law.
    (c) Standard: Retention of records. The records are retained for at 
least 6 years from date of last entry, and longer if required by State 
statute, or if the records may be needed in any pending proceeding.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997]



Sec.  485.639  Condition of participation: Surgical services.

    Surgical procedures must be performed in a safe manner by qualified 
practitioners who have been granted

[[Page 150]]

clinical privileges by the governing body of the CAH in accordance with 
the designation requirements under paragraph (a) of this section.
    (a) Designation of qualified practitioners. The CAH designates the 
practitioners who are allowed to perform surgery for CAH patients, in 
accordance with its approved policies and procedures, and with State 
scope of practice laws. Surgery is performed only by--
    (1) A doctor of medicine or osteopathy, including an osteopathic 
practitioner recognized under section 1101(a)(7) of the Act;
    (2) A doctor of dental surgery or dental medicine; or
    (3) A doctor of podiatric medicine.
    (b) Anesthetic risk and evaluation. (1) A qualified practitioner, as 
specified in paragraph (a) of this section, must examine the patient 
immediately before surgery to evaluate the risk of the procedure to be 
performed.
    (2) A qualified practitioner, as specified in paragraph (c) of this 
section, must examine each patient before surgery to evaluate the risk 
of anesthesia.
    (3) Before discharge from the CAH, each patient must be evaluated 
for proper anesthesia recovery by a qualified practitioner, as specified 
in paragraph (c) of this section.
    (c) Administration of anesthesia. The CAH designates the person who 
is allowed to administer anesthesia to CAH patients in accordance with 
its approved policies and procedures and with State scope-of-practice 
laws.
    (1) Anesthesia must be administered by only--
    (i) A qualified anesthesiologist;
    (ii) A doctor of medicine or osteopathy other than an 
anesthesiologist; including an osteopathic practitioner recognized under 
section 1101(a)(7) of the Act;
    (iii) A doctor of dental surgery or dental medicine;
    (iv) A doctor of podiatric medicine;
    (v) A certified registered nurse anesthetist (CRNA), as defined in 
Sec.  410.69(b) of this chapter;
    (vi) An anesthesiologist's assistant, as defined in Sec.  410.69(b) 
of this chapter; or
    (vii) A supervised trainee in an approved educational program, as 
described in Sec. Sec.  413.85 or 413.86 of this chapter.
    (2) In those cases in which a CRNA administers the anesthesia, the 
anesthetist must be under the supervision of the operating practitioner 
except as provided in paragraph (e) of this section. An 
anesthesiologist's assistant who administers anesthesia must be under 
the supervision of an anesthesiologist.
    (d) Discharge. All patients are discharged in the company of a 
responsible adult, except those exempted by the practitioner who 
performed the surgical procedure.
    (e) Standard: State exemption. (1) A CAH may be exempted from the 
requirement for physician supervision of CRNAs as described in paragraph 
(c)(2) of this section, if the State in which the CAH is located submits 
a letter to CMS signed by the Governor, following consultation with the 
State's Boards of Medicine and Nursing, requesting exemption from 
physician supervision for CRNAs. The letter from the Governor must 
attest that he or she has consulted with the State Boards of Medicine 
and Nursing about issues related to access to and the quality of 
anesthesia services in the State and has concluded that it is in the 
best interests of the State's citizens to opt-out of the current 
physician supervision requirement, and that the opt-out is consistent 
with State law.
    (2) The request for exemption and recognition of State laws and the 
withdrawal of the request may be submitted at any time, and are 
effective upon submission.

[60 FR 45851, Sept. 1, 1995, as amended at 62 FR 46037, Aug. 29, 1997; 
66 FR 39938, Aug. 1, 2001; 66 FR 56769, Nov. 13, 2001]



Sec.  485.641  Condition of participation: Periodic evaluation and quality assurance review.

    (a) Standard: Periodic evaluation--(1) The CAH carries out or 
arranges for a periodic evaluation of its total program. The evaluation 
is done at least once a year and includes review of--
    (i) The utilization of CAH services, including at least the number 
of patients served and the volume of services;

[[Page 151]]

    (ii) A representative sample of both active and closed clinical 
records; and
    (iii) The CAH's health care policies.
    (2) The purpose of the evaluation is to determine whether the 
utilization of services was appropriate, the established policies were 
followed, and any changes are needed.
    (b) Standard: Quality assurance. The CAH has an effective quality 
assurance program to evaluate the quality and appropriateness of the 
diagnosis and treatment furnished in the CAH and of the treatment 
outcomes. The program requires that--
    (1) All patient care services and other services affecting patient 
health and safety, are evaluated;
    (2) Nosocomial infections and medication therapy are evaluated;
    (3) The quality and appropriateness of the diagnosis and treatment 
furnished by nurse practitioners, clinical nurse specialists, and 
physician assistants at the CAH are evaluated by a member of the CAH 
staff who is a doctor of medicine or osteopathy or by another doctor of 
medicine or osteopathy under contract with the CAH;
    (4) The quality and appropriateness of the diagnosis and treatment 
furnished by doctors of medicine or osteopathy at the CAH are evaluated 
by--
    (i) One hospital that is a member of the network, when applicable;
    (ii) One QIO or equivalent entity; or
    (iii) One other appropriate and qualified entity identified in the 
State rural health care plan; and
    (5)(i) The CAH staff considers the findings of the evaluations, 
including any findings or recommendations of the QIO, and takes 
corrective action if necessary.
    (ii) The CAH also takes appropriate remedial action to address 
deficiencies found through the quality assurance program.
    (iii) The CAH documents the outcome of all remedial action.

[58 FR 30671, May 26, 1993, as amended at 62 FR 46037, Aug. 29, 1997; 63 
FR 26359, May 12, 1998]



Sec.  485.643  Condition of participation: Organ, tissue, and eye procurement.

    The CAH must have and implement written protocols that:
    (a) Incorporate an agreement with an OPO designated under part 486 
of this chapter, under which it must notify, in a timely manner, the OPO 
or a third party designated by the OPO of individuals whose death is 
imminent or who have died in the CAH. The OPO determines medical 
suitability for organ donation and, in the absence of alternative 
arrangements by the CAH, the OPO determines medical suitability for 
tissue and eye donation, using the definition of potential tissue and 
eye donor and the notification protocol developed in consultation with 
the tissue and eye banks identified by the CAH for this purpose;
    (b) Incorporate an agreement with at least one tissue bank and at 
least one eye bank to cooperate in the retrieval, processing, 
preservation, storage and distribution of tissues and eyes, as may be 
appropriate to assure that all usable tissues and eyes are obtained from 
potential donors, insofar as such an agreement does not interfere with 
organ procurement;
    (c) Ensure, in collaboration with the designated OPO, that the 
family of each potential donor is informed of its option to either 
donate or not donate organs, tissues, or eyes. The individual designated 
by the CAH to initiate the request to the family must be a designated 
requestor. A designated requestor is an individual who has completed a 
course offered or approved by the OPO and designed in conjunction with 
the tissue and eye bank community in the methodology for approaching 
potential donor families and requesting organ or tissue donation;
    (d) Encourage discretion and sensitivity with respect to the 
circumstances, views, and beliefs of the families of potential donors;
    (e) Ensure that the CAH works cooperatively with the designated OPO, 
tissue bank and eye bank in educating staff on donation issues, 
reviewing death records to improve identification of potential donors, 
and maintaining potential donors while necessary testing and placement 
of potential donated organs, tissues, and eyes take place.

[[Page 152]]

    (f) For purposes of these standards, the term ``organ'' means a 
human kidney, liver, heart, lung, pancreas, or intestines (or 
multivisceral organs).

[65 FR 47110, Aug. 1, 2000, as amended at 66 FR 39938, Aug. 1, 2001]



Sec.  485.645  Special requirements for CAH providers of long-term care services (``swing-beds'')

    A CAH must meet the following requirements in order to be granted an 
approval from CMS to provided post-hospital SNF care, as specified in 
Sec.  409.30 of this chapter, and to be paid for SNF-level services, in 
accordance with paragraph (c) of this section.
    (a) Eligibility. A CAH must meet the following eligibility 
requirements:
    (1) The facility has been certified as a CAH by CMS under Sec.  
485.606(b) of this subpart; and
    (2) The facility provides not more than 25 inpatient beds. Any bed 
of a unit of the facility that is licensed as a distinct-part SNF at the 
time the facility applies to the State for designation as a CAH is not 
counted under paragraph (a) of this section.
    (b) Facilities participating as rural primary care hospitals (RPCHs) 
on September 30, 1997. These facilities must meet the following 
requirements:
    (1) Notwithstanding paragraph (a) of this section, a CAH that 
participated in Medicare as a RPCH on September 30, 1997, and on that 
date had in effect an approval from CMS to use its inpatient facilities 
to provide post-hospital SNF care may continue in that status under the 
same terms, conditions and limitations that were applicable at the time 
those approvals were granted.
    (2) A CAH that was granted swing-bed approval under paragraph (b)(1) 
of this section may request that its application to be a CAH and swing-
bed provider be reevaluated under paragraph (a) of this section. If this 
request is approved, the approval is effective not earlier than October 
1, 1997. As of the date of approval, the CAH no longer has any status 
under paragraph (b)(1) of this section and may not request reinstatement 
under paragraph (b)(1) of this section.
    (c) Payment. Payment for inpatient RPCH services to a CAH that has 
qualified as a CAH under the provisions in paragraph (a) of this section 
is made in accordance with Sec.  413.70 of this chapter. Payment for 
post-hospital SNF-level of care services is made in accordance with the 
payment provisions in Sec.  413.114 of this chapter.
    (d) SNF services. The CAH is substantially in compliance with the 
following SNF requirements contained in subpart B of part 483 of this 
chapter:
    (1) Residents rights (Sec.  483.10(b)(3) through (b)(6), (d) (e), 
(h), (i), (j)(1)(vii) and (viii), (l), and (m) of this chapter).
    (2) Admission, transfer, and discharge rights (Sec.  483.12(a) of 
this chapter).
    (3) Resident behavior and facility practices (Sec.  483.13 of this 
chapter).
    (4) Patient activities (Sec.  483.15(f) of this chapter), except 
that the services may be directed either by a qualified professional 
meeting the requirements of Sec.  485.15(f)(2), or by an individual on 
the facility staff who is designated as the activities director and who 
serves in consultation with a therapeutic recreation specialist, 
occupational therapist, or other professional with experience or 
education in recreational therapy.
    (5) Social services (Sec.  483.15(g) of this chapter).
    (6) Comprehensive assessment, comprehensive care plan, and discharge 
planning (Sec.  483.20(b), (k), and (l) of this chapter, except that the 
CAH is not required to use the resident assessment instrument (RAI) 
specified by the State that is required under Sec.  483.20(b), or to 
comply with the requirements for frequency, scope, and number of 
assessments prescribed in Sec.  413.343(b) of this chapter).
    (7) Specialized rehabilitative services (Sec.  483.45 of this 
chapter).
    (8) Dental services (Sec.  483.55 of this chapter).
    (9) Nutrition (Sec.  483.25(i) of this chapter).

[63 FR 26359, May 12, 1998 as amended at 64 FR 41544, July 30, 1999; 67 
FR 50120, Aug. 1, 2002; 69 FR 49272, Aug. 11, 2004]



Sec.  485.647  Condition of participation: psychiatric and rehabilitation distinct part units.

    (a) Conditions. (1) If a CAH provides inpatient psychiatric services 
in a distinct part unit, the services furnished by the distinct part 
unit must comply

[[Page 153]]

with the hospital requirements specified in Subparts A, B, C, and D of 
Part 482 of this subchapter, the common requirements of Sec.  
412.25(a)(2) through (f) of Part 412 of this chapter for hospital units 
excluded from the prospective payment systems, and the additional 
requirements of Sec.  412.27 of Part 412 of this chapter for excluded 
psychiatric units.
    (2) If a CAH provides inpatient rehabilitation services in a 
distinct part unit, the services furnished by the distinct part unit 
must comply with the hospital requirements specified in Subparts A, B, 
C, and D of Part 482 of this subchapter, the common requirements of 
Sec.  412.25(a)(2) through (f) of Part 412 of this chapter for hospital 
units excluded from the prospective payments systems, and the additional 
requirements of Sec. Sec.  412.29 and Sec.  412.30 of Part 412 of this 
chapter related specifically to rehabilitation units.
    (b) Eligibility requirements. (1) To be eligible to receive Medicare 
payments for psychiatric or rehabilitation services as a distinct part 
unit, the facility provides no more than 10 beds in the distinct part 
unit.
    (2) The beds in the distinct part are excluded from the 25 
inpatient-bed count limit specified in Sec.  485.620(a).
    (3) The average annual 96-hour length of stay requirement specified 
under Sec.  485.620(b) does not apply to the 10 beds in the distinct 
part units specified in paragraph (b)(1) of this section, and admissions 
and days of inpatient care in the distinct part units are not taken into 
account in determining the CAH's compliance with the limits on the 
number of beds and length of stay in Sec.  485.620.

[69 FR 49272, Aug. 11, 2004]

Subpart G [Reserved]



   Subpart H_Conditions of Participation for Clinics, Rehabilitation 
Agencies, and Public Health Agencies as Providers of Outpatient Physical 
             Therapy and Speech-Language Pathology Services



Sec.  485.701  Basis and scope.

    This subpart implements section 1861(p)(4) of the Act, which--
    (a) Defines outpatient physical therapy and speech pathology 
services;
    (b) Imposes requirements with respect to adequate program, 
facilities, policies, staffing, and clinical records; and
    (c) Authorizes the Secretary to establish by regulation other health 
and safety requirements.

[60 FR 2327, Jan. 9, 1995]



Sec.  485.703  Definitions.

    Clinic. A facility that is established primarily to furnish 
outpatient physician services and that meets the following tests of 
physician involvement:
    (1) The medical services are furnished by a group of three or more 
physicians practicing medicine together.
    (2) A physician is present during all hours of operation of the 
clinic to furnish medical services, as distinguished from purely 
administrative services.
    Extension location. A location or site from which a rehabilitation 
agency provides services within a portion of the total geographic area 
served by the primary site. The extension location is part of the 
rehabilitation agency. The extension location should be located 
sufficiently close to share administration, supervision, and services in 
a manner that renders it unnecessary for the extension location to 
independently meet the conditions of participation as a rehabilitation 
agency.
    Organization. A clinic, rehabilitation agency, or public health 
agency.
    Public health agency. An official agency established by a State or 
local government, the primary function of which is to maintain the 
health of the population served by performing environmental health 
services, preventive medical services, and in certain cases, therapeutic 
services.

[[Page 154]]

    Rehabilitation agency. An agency that--
    (1) Provides an integrated interdisciplinary rehabilitation program 
designed to upgrade the physical functioning of handicapped disabled 
individuals by bringing specialized rehabilitation staff together to 
perform as a team; and
    (2) Provides at least physical therapy or speech-language pathology 
services.
    Supervision. Authoritative procedural guidance that is for the 
accomplishment of a function or activity and that--
    (1) Includes initial direction and periodic observation of the 
actual performance of the function or activity; and
    (2) Is furnished by a qualified person--
    (i) Whose sphere of competence encompasses the particular function 
or activity; and
    (ii) Who (unless otherwise provided in this subpart) is on the 
premises if the person performing the function or activity does not meet 
the assistant-level practitioner qualifications specified in Sec.  
485.705.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977, 
and amended at 53 FR 12015, Apr. 12, 1988; 54 FR 38679, Sept. 20, 1989. 
Redesignated and amended at 60 FR 2326, 2327, Jan. 9, 1995; 60 FR 50447, 
Sept. 29, 1995; 73 FR 69941, Nov. 19, 2008]



Sec.  485.705  Personnel qualifications.

    (a) General qualification requirements. Except as specified in 
paragraphs (b) and (c) of this section, all personnel who are involved 
in the furnishing of outpatient physical therapy, occupational therapy, 
and speech-language pathology services directly by or under arrangements 
with an organization must be legally authorized (licensed or, if 
applicable, certified or registered) to practice by the State in which 
they perform the functions or actions, and must act only within the 
scope of their State license or State certification or registration.
    (b) Exception for Federally defined qualifications. The following 
Federally defined qualifications must be met:
    (1) For a physician, the qualifications and conditions as defined in 
section 1861(r) of the Act and the requirements in part 484 of this 
chapter.
    (2) For a speech-language pathologist, the qualifications specified 
in section 1861(11)(1) of the Act and the requirements in part 484 of 
this chapter.
    (c) Exceptions when no State Licensing laws or State certification 
or registration requirements exist. If no State licensing laws or State 
certification or registration requirements exist for the profession, the 
following requirements must be met--
    (1) An administrator is a person who has a bachelor's degree and:
    (i) Has experience or specialized training in the administration of 
health institutions or agencies; or
    (ii) Is qualified and has experience in one of the professional 
health disciplines.
    (2) An occupational therapist must meet the requirements in part 484 
of this chapter.
    (3) An occupational therapy assistant must meet the requirements in 
part 484 of this chapter.
    (4) A physical therapist must meet the requirements in part 484 of 
this chapter.
    (5) A physical therapist assistant must meet the requirements in 
part 484 of this chapter.
    (6) A social worker must meet the requirements in part 484 of this 
chapter.
    (7) A vocational specialist is a person who has a baccalaureate 
degree and--
    (i) Two years experience in vocational counseling in a 
rehabilitation setting such as a sheltered workshop, State employment 
service agency, etc.; or
    (ii) At least 18 semester hours in vocational rehabilitation, 
educational or vocational guidance, psychology, social work, special 
education or personnel administration, and 1 year of experience in 
vocational counseling in a rehabilitation setting; or
    (iii) A master's degree in vocational counseling.
    (8) A nurse practitioner is a person who must:
    (i) Be a registered professional nurse who is authorized by the 
State in which the services are furnished to practice as a nurse 
practitioner in accordance with State law; and

[[Page 155]]

    (ii) Be certified as a nurse practitioner by a recognized national 
certifying body that has established standards for nurse practitioners; 
or
    (iii) Be a registered professional nurse who is authorized by the 
State in which the services are furnished to practice as a nurse 
practitioner in accordance with State law and have been granted a 
Medicare billing number as a nurse practitioner by December 31, 2000; or
    (iv) Be a nurse practitioner who on or after January 1, 2001, 
applies for a Medicare billing number for the first time and meets the 
standards for nurse practitioners in paragraphs (c)(8)(i) and (c)(8)(ii) 
of this section; or
    (v) Be a nurse practitioner who on or after January 1, 2003, applies 
for a Medicare billing number for the first time and possesses a 
master's degree in nursing and meets the standards for nurse 
practitioners in paragraphs (b)(1)(i) and (b)(1)(ii) of this section.
    (9) A clinical nurse specialist is a person who must:
    (i) Be a registered nurse who is currently licensed to practice in 
the State where he or she practices and be authorized to perform the 
services of a clinical nurse specialist in accordance with State law;
    (ii) Have a master's degree in a defined clinical area of nursing 
from an accredited educational institution; and,
    (iii) Be certified as a clinical nurse specialist by the American 
Nurses Credentialing Center.
    (10) A physician assistant is a person who:
    (i) Has graduated from a physician assistant educational program 
that is accredited by the Commission on Accreditation of Allied Health 
Education Programs; or
    (ii) Has passed the national certification examination that is 
administered by the National Commission on Certification of Physician 
Assistants; and
    (iii) Is licensed by the State to practice as a physician assistant.

[63 FR 58912, Nov. 2, 1998; 64 FR 25457, May 12, 1999; 64 FR 59442, Nov. 
2, 1999]



Sec.  485.707  Condition of participation: Compliance with Federal, State, and local laws.

    The organization and its staff are in compliance with all applicable 
Federal, State, and local laws and regulations.
    (a) Standard: Licensure of organization. In any State in which State 
or applicable local law provides for the licensing of organizations, a 
clinic, rehabilitation agency, or public health agency is licensed in 
accordance with applicable laws.
    (b) Standard: Licensure or registration of personnel. Staff of the 
organization are licensed or registered in accordance with applicable 
laws.

[41 FR 20865, May 21, 1976, unless otherwise noted. Redesignated at 42 
FR 52826, Sept. 30, 1977. Further redesignated and amended at 60 FR 
2326, 2327, Jan. 9, 1995]



Sec.  485.709  Condition of participation: Administrative management.

    The clinic or rehabilitation agency has an effective governing body 
that is legally responsible for the conduct of the clinic or 
rehabilitation agency. The governing body designates an administrator, 
and establishes administrative policies.
    (a) Standard: Governing body. There is a governing body (or 
designated person(s) so functioning) which assumes full legal 
responsibility for the overall conduct of the clinic or rehabilitation 
agency and for compliance with applicable laws and regulations. The name 
of the owner(s) of the clinic or rehabilitation agency is fully 
disclosed to the State agency. In the case of corporations, the names of 
the corporate officers are made known.
    (b) Standard: Administrator. The governing body--
    (1) Appoints a qualified full-time administrator;
    (2) Delegates to the administrator the internal operation of the 
clinic or rehabilitation agency in accordance with written policies;
    (3) Defines clearly the administrator's responsibilities for 
procurement and direction of personnel; and
    (4) Designates a competent individual to act during temporary 
absence of the administrator.

[[Page 156]]

    (c) Standard: Personnel policies. Personnel practices are supported 
by appropriate written personnel policies that are kept current. 
Personnel records include the qualifications of all professional and 
assistant level personnel, as well as evidence of State licensure if 
applicable.
    (d) Standard: Patient care policies. Patient care practices and 
procedures are supported by written policies established by a group of 
professional personnel including one or more physicians associated with 
the clinic or rehabilitation agency, one or more qualified physical 
therapists (if physical therapy services are provided), and one or more 
qualified speech pathologists (if speech pathology services are 
provided). The policies govern the outpatient physical therapy and/or 
speech pathology services and related services that are provided. These 
policies are evaluated at least annually by the group of professional 
personnel, and revised as necessary based upon this evaluation.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977, 
and amended at 53 FR 12015, Apr. 12, 1988. Redesignated and amended at 
60 FR 2326, 2327, Jan. 9, 1995; 60 FR 50447, Sept. 29, 1995]



Sec.  485.711  Condition of participation: Plan of care and physician involvement.

    For each patient in need of outpatient physical therapy or speech 
pathology services, there is a written plan of care established and 
periodically reviewed by a physician, or by a physical therapist or 
speech pathologist respectively.
    (a) Standard: Medical history and prior treatment. The following are 
obtained by the organization before or at the time of initiation of 
treatment:
    (1) The patient's significant past history.
    (2) Current medical findings, if any.
    (3) Diagnosis(es), if established.
    (4) Physician's orders, if any.
    (5) Rehabilitation goals, if determined.
    (6) Contraindications, if any.
    (7) The extent to which the patient is aware of the diagnosis(es) 
and prognosis.
    (8) If appropriate, the summary of treatment furnished and results 
achieved during previous periods of rehabilitation services or 
institutionalization.
    (b) Standard: Plan of care. (1) For each patient there is a written 
plan of care established by the physician or by the physical therapist 
or speech-language pathologist who furnishes the services.
    (2) The plan of care for physical therapy or speech pathology 
services indicates anticipated goals and specifies for those services 
the--
    (i) Type;
    (ii) Amount;
    (iii) Frequency; and
    (iv) Duration.
    (3) The plan of care and results of treatment are reviewed by the 
physician or by the individual who established the plan at least as 
often as the patient's condition requires, and the indicated action is 
taken.
    (4) Changes in the plan of care are noted in the clinical record. If 
the patient has an attending physician, the therapist or speech-language 
pathologist who furnishes the services promptly notifies him or her of 
any change in the patient's condition or in the plan of care.
    (c) Standard: Emergency care. The rehabilitation agency must 
establish procedures to be followed by personnel in an emergency, which 
cover immediate care of the patient, persons to be notified, and reports 
to be prepared.

[54 FR 38679, Sept. 20, 1989. Redesignated and amended at 60 FR 2326, 
2327, Jan. 9, 1995; 63 FR 58913, Nov. 2, 1998; 73 FR 69941, Nov. 19, 
2008]



Sec.  485.713  Condition of participation: Physical therapy services.

    If the organization offers physical therapy services, it provides an 
adequate program of physical therapy and has an adequate number of 
qualified personnel and the equipment necessary to carry out its program 
and to fulfill its objectives.
    (a) Standard: Adequate program. (1) The organization is considered 
to have an adequate outpatient physical therapy program if it can:
    (i) Provide services using therapeutic exercise and the modalities 
of heat, cold, water, and electricity;

[[Page 157]]

    (ii) Conduct patient evaluations; and
    (iii) Administer tests and measurements of strength, balance, 
endurance, range of motion, and activities of daily living.
    (2) A qualified physical therapist is present or readily available 
to offer supervision when a physical therapist assistant furnishes 
services.
    (i) If a qualified physical therapist is not on the premises during 
all hours of operation, patients are scheduled so as to ensure that the 
therapist is present when special skills are needed, for example, for 
evaluation and reevaluation.
    (ii) When a physical therapist assistant furnishes services off the 
organization's premises, those services are supervised by a qualified 
physical therapist who makes an onsite supervisory visit at least once 
every 30 days.
    (b) Standard: Facilities and equipment. The organization has the 
equipment and facilities required to provide the range of services 
necessary in the treatment of the types of disabilities it accepts for 
service.
    (c) Standard: Personnel qualified to provide physical therapy 
services. Physical therapy services are provided by, or under the 
supervision of, a qualified physical therapist. The number of qualified 
physical therapists and qualified physical therapist assistants is 
adequate for the volume and diversity of physical therapy services 
offered. A qualified physical therapist is on the premises or readily 
available during the operating hours of the organization.
    (d) Standard: Supportive personnel. If personnel are available to 
assist qualified physical therapists by performing services incident to 
physical therapy that do not require professional knowledge and skill, 
these personnel are instructed in appropriate patient care services by 
qualified physical therapists who retain responsibility for the 
treatment prescribed by the attending physician.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, 2327, Jan. 9, 1995; 60 
FR 50447, Sept. 29, 1995]



Sec.  485.715  Condition of participation: Speech pathology services.

    If speech pathology services are offered, the organization provides 
an adequate program of speech pathology and has an adequate number of 
qualified personnel and the equipment necessary to carry out its program 
and to fulfill its objectives.
    (a) Standard: Adequate program. The organization is considered to 
have an adequate outpatient speech pathology program if it can provide 
the diagnostic and treatment services to effectively treat speech 
disorders.
    (b) Standard: Facilities and equipment. The organization has the 
equipment and facilities required to provide the range of services 
necessary in the treatment of the types of speech disorders it accepts 
for service.
    (c) Standard: Personnel qualified to provide speech pathology 
services. Speech pathology services are given or supervised by a 
qualified speech pathologist and the number of qualified speech 
pathologists is adequate for the volume and diversity of speech 
pathology services offered. At least one qualified speech pathologist is 
present at all times when speech pathology services are furnished.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326-2328, Jan. 9, 1995]



Sec.  485.717  Condition of participation: Rehabilitation program.

    This condition and standards apply only to a rehabilitation agency's 
own patients, not to patients of hospitals, skilled nursing facilities 
(SNFs), or Medicaid nursing facilities (NFs) to which the agency 
furnishes services. The hospital, SNF, or NF is responsible for ensuring 
that qualified staff furnish services for which they arrange or contract 
for their patients. The rehabilitation agency provides physical therapy 
and speech-language pathology services to all of its patients who need 
them.
    (a) Standard: Qualification of staff. The agency's therapy services 
are furnished by qualified individuals as direct services and/or 
services provided under contract.
    (b) Standard: Arrangements for services. If services are provided 
under contract,

[[Page 158]]

the contract must specify the term of the contract, the manner of 
termination or renewal and provide that the agency retains 
responsibility for the control and supervision of the services.

[73 FR 69942, Nov. 19, 2008]



Sec.  485.719  Condition of participation: Arrangements for physical therapy and speech pathology services to be performed by other than salaried organization 
          personnel.

    (a) Conditions. If an organization provides outpatient physical 
therapy or speech pathology services under an arrangement with others, 
the services are to be furnished in accordance with the terms of a 
written contract, which provides that the organization retains of 
professional and administrative responsibility for, and control and 
supervision of, the services.
    (b) Standard: Contract provisions. The contract--
    (1) Specifies the term of the contract and the manner of termination 
or renewal;
    (2) Requires that personnel who furnish the services meet the 
requirements that are set forth in this subpart for salaried personnel; 
and
    (3) Provides that the contracting outside resource may not bill the 
patient or Medicare for the services. This limitation is based on 
section 1861(w)(1) of the Act, which provides that--
    (i) Only the provider may bill the beneficiary for covered services 
furnished under arrangements; and
    (ii) Receipt of Medicare payment by the provider, on behalf of an 
entitled individual, discharges the liability of the individual or any 
other person to pay for those services.

[56 FR 46562, Sept. 13, 1991. Redesignated and amended at 60 FR 2326, 
2328, Jan. 9, 1995; 60 FR 50447, Sept. 29, 1995]



Sec.  485.721  Condition of participation: Clinical records.

    The organization maintains clinical records on all patients in 
accordance with accepted professional standards, and practices. The 
clinical records are completely and accurately documented, readily 
accessible, and systematically organized to facilitate retrieving and 
compiling information.
    (a) Standard: Protection of clinical record information. The 
organization recognizes the confidentiality of clinical record 
information and provides safeguards against loss, destruction, or 
unauthorized use. Written procedures govern the use and removal of 
records and the conditions for release of information. The patient's 
written consent is required for release of information not authorized by 
law.
    (b) Standard: Content. The clinical record contains sufficient 
information to identify the patient clearly, to justify the 
diagnosis(es) and treatment, and to document the results accurately. All 
clinical records contain the following general categories of data:
    (1) Documented evidence of the assessment of the needs of the 
patient, of an appropriate plan of care, and of the care and services 
furnished.
    (2) Identification data and consent forms.
    (3) Medical history.
    (4) Report of physical examinations, if any.
    (5) Observations and progress notes.
    (6) Reports of treatments and clinical findings.
    (7) Discharge summary including final diagnosis(es) and prognosis.
    (c) Standard: Completion of records and centralization of reports. 
Current clinical records and those of discharged patients are completed 
promptly. All clinical information pertaining to a patient is 
centralized in the patient's clinical record. Each physician signs the 
entries that he or she makes in the clinical record.
    (d) Standard: Retention and preservation. Clinical records are 
retained for at least:
    (1) The period determined by the respective State statute, or the 
statute of limitations in the State; or
    (2) In the absence of a State statute--
    (i) Five years after the date of discharge; or
    (ii) In the case of a minor, 3 years after the patient becomes of 
age under State law or 5 years after the date of discharge, whichever is 
longer.
    (e) Standard: Indexes. Clinical records are indexed at least 
according to name of patient to facilitate acquisition of

[[Page 159]]

statistical medical information and retrieval of records for research or 
administrative action.
    (f) Standard: Location and facilities. The organization maintains 
adequate facilities and equipment, conveniently located, to provide 
efficient processing of clinical records (reviewing, indexing, filing, 
and prompt retrieval).

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326-2328, Jan. 9, 1995]



Sec.  485.723  Condition of participation: Physical environment.

    The building housing the organization is constructed, equipped, and 
maintained to protect the health and safety of patients, personnel, and 
the public and provides a functional, sanitary, and comfortable 
environment.
    (a) Standard: Safety of patients. The organization satisfies the 
following requirements:
    (1) It complies with all applicable State and local building, fire, 
and safety codes.
    (2) Permanently attached automatic fire-extinguishing systems of 
adequate capacity are installed in all areas of the premises considered 
to have special fire hazards. Fire extinguishers are conveniently 
located on each floor of the premises. Fire regulations are prominently 
posted.
    (3) Doorways, passageways and stairwells negotiated by patients are:
    (i) Of adequate width to allow for easy movement of all patients 
(including those on stretchers or in wheelchairs), (ii) free from 
obstruction at all times, and (iii) in the case of stairwells, equipped 
with firmly attached handrails on at least one side.
    (4) Lights are placed at exits and in corridors used by patients and 
are supported by an emergency power source.
    (5) A fire alarm system with local alarm capability and, where 
applicable, an emergency power source, is functional.
    (6) At least two persons are on duty on the premises of the 
organization whenever a patient is being treated.
    (7) No occupancies or activities undesirable or injurious to the 
health and safety of patients are located in the building.
    (b) Standard: Maintenance of equipment, building, and grounds. The 
organization establishes a written preventive-maintenance program to 
ensure that--
    (1) The equipment is operative, and is properly calibrated; and
    (2) The interior and exterior of the building are clean and orderly 
and maintained free of any defects that are a potential hazard to 
patients, personnel, and the public.
    (c) Standard: Other environmental considerations. The organization 
provides a functional, sanitary, and comfortable environment for 
patients, personnel, and the public.
    (1) Provision is made for adequate and comfortable lighting levels 
in all areas; limitation of sounds at comfort levels; a comfortable room 
temperature; and adequate ventilation through windows, mechanical means, 
or a combination of both.
    (2) Toilet rooms, toilet stalls, and lavatories are accessible and 
constructed so as to allow use by nonambulatory and semiambulatory 
individuals.
    (3) Whatever the size of the building, there is an adequate amount 
of space for the services provided and disabilities treated, including 
reception area, staff space, examining room, treatment areas, and 
storage.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326-2328, Jan. 9, 1995]



Sec.  485.725  Condition of participation: Infection control.

    The organization that provides outpatient physical therapy services 
establishes an infection-control committee of representative 
professional staff with responsibility for overall infection control. 
All necessary housekeeping and maintenance services are provided to 
maintain a sanitary and comfortable environment and to help prevent the 
development and transmission of infection.
    (a) Standard: Infection-control committee. The infection-control 
committee establishes policies and procedures for investigating, 
controlling, and preventing infections in the organization and monitors 
staff performance to ensure that the policies and procedures are 
executed.

[[Page 160]]

    (b) All personnel follow written procedures for effective aseptic 
techniques. The procedures are reviewed annually and revised if 
necessary to improve them.
    (c) Standard: Housekeeping. (1) The organization employs sufficient 
housekeeping personnel and provides all necessary equipment to maintain 
a safe, clean, and orderly interior. A full-time employee is designated 
as the one responsible for the housekeeping services and for supervision 
and training of housekeeping personnel.
    (2) An organization that has a contract with an outside resource for 
housekeeping services may be found to be in compliance with this 
standard provided the organization or outside resource or both meet the 
requirements of the standard.
    (d) Standard: Linen. The organization has available at all times a 
quantity of linen essential for proper care and comfort of patients. 
Linens are handled, stored, processed, and transported in such a manner 
as to prevent the spread of infection.
    (e) Standard: Pest control. The organization's premises are 
maintained free from insects and rodents through operation of a pest-
control program.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, 2328, Jan. 9, 1995; 60 
FR 50447, Sept. 29, 1995]



Sec.  485.727  Condition of participation: Disaster preparedness.

    The organization has a written plan, periodically rehearsed, with 
procedures to be followed in the event of an internal or external 
disaster and for the care of casualties (patients and personnel) arising 
from a disaster.
    (a) Standard: Disaster plan. The organization has a written plan in 
operation, with procedures to be followed in the event of fire, 
explosion, or other disaster. The plan is developed and maintained with 
the assistance of qualified fire, safety, and other appropriate experts, 
and includes:
    (1) Transfer of casualties and records;
    (2) The location and use of alarm systems and signals;
    (3) Methods of containing fire;
    (4) Notification of appropriate persons; and
    (5) Evacuation routes and procedures.
    (b) Standard: Staff training and drills. All employees are trained, 
as part of their employment orientation, in all aspects of preparedness 
for any disaster. The disaster program includes orientation and ongoing 
training and drills for all personnel in all procedures so that each 
employee promptly and correctly carries out his assigned role in case of 
a disaster.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977, 
and amended at 53 FR 12015, Apr. 12, 1988. Redesignated and amended at 
60 FR 2326-2327, 2329, Jan. 9, 1995]



Sec.  485.729  Condition of participation: Program evaluation.

    The organization has procedures that provide for a systematic 
evaluation of its total program to ensure appropriate utilization of 
services and to determine whether the organization's policies are 
followed in providing services to patients through employees or under 
arrangements with others.
    (a) Standard: Clinical-record review. A sample of active and closed 
clinical records is reviewed quarterly by the appropriate health 
professionals to ensure that established policies are followed in 
providing services.
    (b) Standard: Annual statistical evaluation. An evaluation is 
conducted annually of statistical data such as number of different 
patients treated, number of patient visits, condition on admission and 
discharge, number of new patients, number of patients by diagnosis(es), 
sources of referral, number and cost of units of service by treatment 
given, and total staff days or work hours by discipline.

[41 FR 20865, May 21, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326-2327, 2329, Jan. 9, 1995]



PART 486_CONDITIONS FOR COVERAGE OF SPECIALIZED SERVICES FURNISHED BY SUPPLIERS--Table of Contents




                      Subpart A_General Provisions

Sec.
486.1 Basis and scope.

Subpart B [Reserved]

[[Page 161]]

       Subpart C_Conditions for Coverage: Portable X-Ray Services

486.100 Condition for coverage: Compliance with Federal, State, and 
          local laws and regulations.
486.102 Condition for coverage: Supervision by a qualified physician.
486.104 Condition for coverage: Qualifications, orientation, and health 
          of technical personnel.
486.106 Condition for coverage: Referral for service and preservation of 
          records.
486.108 Condition for coverage: Safety standards.
486.110 Condition for coverage: Inspection of equipment.

Subparts D-F [Reserved]

Subpart G_Requirements for Certification and Designation and Conditions 
              for Coverage: Organ Procurement Organizations

486.301 Basis and scope.
486.302 Definitions.

             Requirements for Certification and Designation

486.303 Requirements for certification.
486.304 Requirements for designation.
486.306 OPO service area size designation and documentation 
          requirements.
486.308 Designation of one OPO for each service area.
486.309 Re-certification from August 1, 2006 through July 31, 2010.
486.310 Changes in control or ownership or service area.

                  Re-certification and De-certification

486.312 De-certification.
486.314 Appeals.
486.316 Re-certification and competition processes.

           Organ Procurement Organization Outcome Requirements

486.318 Condition: Outcome measures.

       Organ Procurement Organization Process Performance Measures

486.320 Condition: Participation in Organ Procurement and 
          Transplantation Network.
486.322 Condition: Relationships with hospitals, critical access 
          hospitals, and tissue banks.
486.324 Condition: Administration and governing body.
486.326 Condition: Human resources.
486.328 Condition: Reporting of data.
486.330 Condition: Information management.
486.342 Condition: Requesting consent.
486.344 Condition: Evaluation and management of potential donors and 
          organ placement and recovery.
486.346 Condition: Organ preparation and transport.
486.348 Condition: Quality assessment and performance improvement 
          (QAPI).

    Authority: Secs. 1102, 1138, and 1871 of the Social Security Act (42 
U.S.C. 1302, 1320b-8, and 1395hh) and section 371 of the Public Health 
Service Act (42 U.S.C 273).



                      Subpart A_General Provisions



Sec.  486.1  Basis and scope.

    (a) Statutory basis. This part is based on the following sections of 
the Act:

    1102 and 1138(b), 1871 of the Social Security Act, section 371(b) of 
the Public Health Service Act--for coverage of organ procurement 
services.
    1861(p)--for coverage of outpatient physical therapy services 
furnished by physical therapists in independent practice.
    1861(s) (3), (15), and (17)--for coverage of portable X-ray 
services.

    (b) Scope. (1) This part sets forth the conditions for coverage of 
certain specialized services that are furnished by suppliers and that 
are not specified in other portions of this chapter.
    (2) The conditions for coverage of other specialized services 
furnished by suppliers are set forth in the following regulations which, 
unless otherwise indicated, are part of this chapter:
    (i) Ambulatory surgical center (ASC) services--Part 416.
    (ii) Ambulance services--Part 410, subpart B.
    (iii) ESRD services--Part 405, subpart U.
    (iv) Laboratory services--Part 493.
    (v) Mammography services--Part 410, subpart B (Sec.  410.34) and 21 
CFR Part 900, subpart B, of the Food and Drug Administration 
regulations.
    (vi) Rural health clinic and Federally qualified health center 
services--Part 491, subpart A.

[60 FR 50447, Sept. 29, 1995, as amended at 71 FR 31046, May 31, 2006]

Subpart B [Reserved]

[[Page 162]]



       Subpart C_Conditions for Coverage: Portable X-Ray Services

    Authority: Secs. 1102, 1861(s) (3), (11) and (12), 1864, and 1871 of 
the Social Security Act (42 U.S.C. 1302, 1395x(s) (3), (11), and (12), 
1395aa and 1395hh).

    Source: 34 FR 388, Jan. 10, 1969, unless otherwise noted. 
Redesignated at 42 FR 52826, Sept. 30, 1977, and further redesignated 
and amended at 60 FR 2326, Jan. 9, 1995.



Sec.  486.100  Condition for coverage: Compliance with Federal, State, and local laws and regulations.

    The supplier of portable X-ray services is in conformity with all 
applicable Federal, State, and local laws and regulations.
    (a) Standard--licensure or registration of supplier. In any State in 
which State or applicable local law provides for the licensure or 
registration of suppliers of X-ray services, the supplier is (1) 
licensed or registered pursuant to such law, or (2) approved by the 
agency of the State or locality responsible for licensure or 
registration as meeting the standards established for such licensure or 
registration.
    (b) Standard--licensure or registration of personnel. All personnel 
engaged in operating portable X-ray equipment are currently licensed or 
registered in accordance with all applicable State and local laws.
    (c) Standard--licensure or registration of equipment. All portable 
X-ray equipment used in providing portable X-ray services is licensed or 
registered in accordance with all applicable State and local laws.
    (d) Standard--conformity with other Federal, State, and local laws 
and regulations. The supplier of portable X-ray services agrees to 
render such services in conformity with Federal, State, and local laws 
relating to safety standards.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, Jan. 9, 1995; 60 FR 
45086, Aug. 30, 1995]



Sec.  486.102  Condition for coverage: Supervision by a qualified physician.

    Portable X-ray services are provided under the supervision of a 
qualified physician.
    (a) Standard--physician supervision. The performance of the 
roentgenologic procedures is subject to the supervision of a physician 
who meets the requirements of paragraph (b) of this section and one of 
the following requirements is met:
    (1) The supervising physician owns the equipment and it is operated 
only by his employees, or
    (2) The supervising physician certifies annually that he 
periodically checks the procedural manuals and observes the operators' 
performance, that he has verified that equipment and personnel meet 
applicable Federal, State, and local licensure and registration 
requirements and that safe operating procedures are used.
    (b) Standard--qualifications of the physician supervisor. Portable 
X-ray services are provided under the supervision of a licensed doctor 
of medicine or licensed doctor of osteopathy who is qualified by 
advanced training and experience in the use of X-rays for diagnostic 
purposes, i.e., he (1) is certified in radiology by the American Board 
of Radiology or by the American Osteopathic Board of Radiology or 
possesses qualifications which are equivalent to those required for such 
certification, or (2) is certified or meets the requirements for 
certification in a medical specialty in which he has become qualified by 
experience and training in the use of X-rays for diagnostic purposes, or 
(3) specializes in radiology and is recognized by the medical community 
as a specialist in radiology.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, Jan. 9, 1995; 60 FR 
45086, Aug. 30, 1995]



Sec.  486.104  Condition for coverage: Qualifications, orientation and health of technical personnel.

    Portable X-ray services are provided by qualified technologists.
    (a) Standard-qualifications of technologists. All operators of the 
portable X-ray equipment meet the requirements of paragraphs (a)(1), 
(2), (3), or (4) of this section:
    (1) Successful completion of a program of formal training in X-ray 
technology in a school approved by the Joint Review Committee on 
Education

[[Page 163]]

in Radiologic Technology (JRCERT), or have earned a bachelor's or 
associate degree in radiologic technology from an accredited college or 
university.
    (2) For those whose training was completed prior to July 1, 1966, 
but on or after July 1, 1960: Successful completion of 24 full months of 
training and/or experience under the direct supervision of a physician 
who is certified in radiology by the American College of Radiology or 
who possesses qualifications which are equivalent to those required for 
such certification, and at least 12 full months of pertinent portable X-
ray equipment operation experience in the 5 years prior to January 1, 
1968.
    (3) For those whose training was completed prior to July 1, 1960: 
Successful completion of 24 full months of training and/or experience of 
which at least 12 full months were under the direct supervision of a 
physician who is certified in radiology by the American College of 
Radiology or who possesses qualifications which are equivalent to those 
required for such certification, and at least 12 full months of 
pertinent portable X-ray equipment operation experience in the 5 years 
prior to January 1, 1968.
    (4) For those whose training was completed prior to January 1, 1993, 
successful completion of a program of formal training in X-ray 
technology in a school approved by the Council on Education of the 
American Medical Association, or by the American Osteopathic Association 
is acceptable.
    (b) Standard--personnel orientation. The supplier of portable X-ray 
services has an orientation program for personnel, based on a procedural 
manual which is: Available to all members of the staff, incorporates 
relevant portions of professionally recognized documents, and includes 
instruction in all of the following:
    (1) Precautions to be followed to protect the patient from 
unnecessary exposure to radiation;
    (2) Precautions to be followed to protect an individual supporting 
the patient during X-ray procedures from unnecessary exposure to 
radiation;
    (3) Precautions to be followed to protect other individuals in the 
surrounding environment from exposure to radiation;
    (4) Precautions to be followed to protect the operator of portable 
X-ray equipment from unnecessary exposure to radiation;
    (5) Considerations in determining the area which will receive the 
primary beam;
    (6) Determination of the time interval at which to check personnel 
radiation monitors;
    (7) Use of the personnel radiation monitor in providing an 
additional check on safety of equipment;
    (8) Proper use and maintenance of equipment;
    (9) Proper maintenance of records;
    (10) Technical problems which may arise and methods of solution;
    (11) Protection against electrical hazards;
    (12) Hazards of excessive exposure to radiation.
    (c) Standard: Employee records. Records are maintained and include 
evidence that--
    (1) Each employee is qualified for his or her position by means of 
training and experience; and
    (2) Employees receive adequate health supervision.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977, 
and amended at 53 FR 12015, Apr. 12, 1988; 60 FR 45086, Aug. 30, 1995; 
73 FR 69942, Nov. 19, 2008]



Sec.  486.106  Condition for coverage: Referral for service and preservation of records.

    All portable X-ray services performed for Medicare beneficiaries are 
ordered by a doctor of medicine or doctor of osteopathy and records are 
properly preserved.
    (a) Standard--referral by a physician. Portable X-ray examinations 
are performed only on the order of a doctor of medicine or doctor of 
osteopathy licensed to practice in the State. The supplier's records 
show that:
    (1) The X-ray test was ordered by a licensed doctor of medicine or 
doctor of osteopathy, and
    (2) Such physician's written, signed order specifies the reason an 
X-ray test is required, the area of the body to be exposed, the number 
of radiographs to be obtained, and the views needed; it

[[Page 164]]

also includes a statement concerning the condition of the patient which 
indicates why portable X-ray services are necessary.
    (b) Standard--records of examinations performed. The supplier makes 
for each patient a record of the date of the X-ray examination, the name 
of the patient, a description of the procedures ordered and performed, 
the referring physician, the operator(s) of the portable X-ray equipment 
who performed the examination, the physician to whom the radiograph was 
sent, and the date it was sent.
    (c) Standard--preservation of records. Such reports are maintained 
for a period of at least 2 years, or for the period of time required by 
State law for such records (as distinguished from requirements as to the 
radiograph itself), whichever is longer.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, Jan. 9, 1995; 60 FR 
45086, Aug. 30, 1995]



Sec.  486.108  Condition for coverage: Safety standards.

    X-ray examinations are conducted through the use of equipment which 
is free of unnecessary hazards for patients, personnel, and other 
persons in the immediate environment, and through operating procedures 
which provide minimum radiation exposure to patients, personnel, and 
other persons in the immediate environment.
    (a) Standard--tube housing and devices to restrict the useful beam. 
The tube housing is of diagnostic type. Diaphragms, cones, or adjustable 
collimators capable of restricting the useful beam to the area of 
clinical interest are used and provide the same degree of protection as 
is required of the housing.
    (b) Standard--total filtration. (1) The aluminum equivalent of the 
total filtration in the primary beam is not less than that shown in the 
following table except when contraindicated for a particular diagnostic 
procedure.

------------------------------------------------------------------------
                                             Total filtration (inherent
              Operating kVp                         plus added)
------------------------------------------------------------------------
Below 50 kVp.............................  0.5 millimeters aluminum.
50-70 kVp................................  1.5 millimeters aluminum.
Above 70 kVp.............................  2.5 millimeters aluminum.
------------------------------------------------------------------------

    (2) If the filter in the machine is not accessible for examination 
or the total filtration is unknown, it can be assumed that the 
requirements are met if the half-value layer is not less than that shown 
in the following table:

------------------------------------------------------------------------
              Operating kVp                       Half-value layer
------------------------------------------------------------------------
50 kVp...................................  0.6 millimeters aluminum.
70 kVp...................................  1.6 millimeters aluminum.
90 kVp...................................  2.6 millimeters aluminum.
100 kVp..................................  2.8 millimeters aluminum.
110 kVp..................................  3.0 millimeters aluminum.
120 kVp..................................  3.3 millimeters aluminum.
------------------------------------------------------------------------

    (c) Standard--termination of exposure. A device is provided to 
terminate the exposure after a preset time or exposure.
    (d) Standard--control panel. The control panel provides a device 
(usually a milliammeter or a means for an audible signal to give 
positive indication of the production of X-rays whenever the X-ray tube 
is energized. The control panel includes appropriate indicators 
(labelled control settings and/or meters) which show the physical 
factors (such as kVp, mA, exposure time or whether timing is automatic) 
used for the exposure.
    (e) Standard--exposure control switch. The exposure control switch 
is of the dead-man type and is so arranged that the operator can stand 
at least 6 feet from the patient and well away from the useful beam.
    (f) Standard--protection against electrical hazards. Only shockproof 
equipment is used. All electrical equipment is grounded.
    (g) Standard--mechanical supporting or restraining devices. 
Mechanical supporting or restraining devices are provided so that such 
devices can be used when a patient must be held in position for 
radiography.
    (h) Standard--protective gloves and aprons. Protective gloves and 
aprons are provided so that when the patient must be held by an 
individual, that individual is protected with these shielding devices.
    (i) Standard--restriction of the useful beam. Diaphragms, cones, or 
adjustable collimators are used to restrict the useful beam to the area 
of clinical interest.
    (j) Standard--personnel monitoring. A device which can be worn to 
monitor

[[Page 165]]

radiation exposure (e.g., a film badge) is provided to each individual 
who operates portable X-ray equipment. The device is evaluated for 
radiation exposure to the operator at least monthly and appropriate 
records are maintained by the supplier of portable X-ray services of 
radiation exposure measured by such a device for each individual.
    (k) Standard--personnel and public protection. No individual 
occupationally exposed to radiation is permitted to hold patients during 
exposures except during emergencies, nor is any other individual 
regularly used for this service. Care is taken to assure that pregnant 
women do not assist in portable X-ray examinations.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, Jan. 9, 1995; 60 FR 
45086, Aug. 30, 1995]



Sec.  486.110  Condition for coverage: Inspection of equipment.

    Inspections of all X-ray equipment and shielding are made by 
qualified individuals at intervals not greater than every 24 months.
    (a) Standard--qualified inspectors. Inspections are made at least 
every 24 months by a radiation health specialist who is on the staff of 
or approved by an appropriate State or local government agency.
    (b) Standard--records of inspection and scope of inspection. The 
supplier maintains records of current inspections which include the 
extent to which equipment and shielding are in compliance with the 
safety standards outlined in Sec.  486.108.

[34 FR 388, Jan. 10, 1969. Redesignated at 42 FR 52826, Sept. 30, 1977. 
Further redesignated and amended at 60 FR 2326, Jan. 9, 1995; 60 FR 
45086, Aug. 30, 1995; 60 FR 50447, Sept. 29, 1995]

Subparts D-F [Reserved]



Subpart G_Requirements for Certification and Designation and Conditions 
              for Coverage: Organ Procurement Organizations

    Source: 71 FR 31046, May 31, 2006, unless otherwise noted.



Sec.  486.301  Basis and scope.

    (a) Statutory basis. (1) Section 1138(b) of the Act sets forth the 
requirements that an organ procurement organization (OPO) must meet to 
have its organ procurement services to hospitals covered under Medicare 
and Medicaid. These include certification as a ``qualified'' OPO and 
designation as the OPO for a particular service area.
    (2) Section 371(b) of the Public Health Service Act sets forth the 
requirements for certification and the functions that a qualified OPO is 
expected to perform.
    (3) Section 1102 of the Act authorizes the Secretary of Health and 
Human Services to make and publish rules and regulations necessary to 
the efficient administration of the functions that are assigned to the 
Secretary under the Act.
    (4) Section 1871 of the Act authorizes the Secretary to prescribe 
regulations as may be necessary to carry out the administration of the 
Medicare program under title XVIII.
    (b) Scope. This subpart sets forth--
    (1) The conditions and requirements that an OPO must meet;
    (2) The procedures for certification and designation of OPOs; and
    (3) The terms of the agreement with CMS and the basis for and the 
effect of de-certification.
    (4) The requirements for an OPO to be re-certified.



Sec.  486.302  Definitions.

    As used in this subpart, the following definitions apply:
    Adverse event means an untoward, undesirable, and usually 
unanticipated event that causes death or serious injury or the risk 
thereof. As applied to OPOs, adverse events include but are not limited 
to transmission of disease from a donor to a recipient, avoidable loss 
of a medically suitable potential donor for whom consent for donation 
has been obtained, or delivery to a transplant center of the wrong organ 
or an organ whose blood type does not match the blood type of the 
intended recipient.
    Agreement cycle refers to the time period of at least 4 years when 
an agreement is in effect between CMS and an OPO.

[[Page 166]]

    Certification means a CMS determination that an OPO meets the 
requirements for certification at Sec.  486.303.
    Death record review means an assessment of the medical chart of a 
deceased patient to evaluate potential for organ donation.
    Decertification means a CMS determination that an OPO no longer 
meets the requirements for certification at Sec.  486.303.
    Designated requestor or effective requestor is an individual 
(generally employed by a hospital), who is trained to handle or 
participate in the donation consent process. The designated requestor 
may request consent for donation from the family of a potential donor or 
from the individual(s) responsible for making the donation decision in 
circumstances permitted under State law, provide information about 
donation to the family or decision-maker(s), or provide support to or 
collaborate with the OPO in the donation consent process.
    Designation means CMS assignment of a geographic service area to an 
OPO. Once an OPO is certified and assigned a geographic service area, 
organ procurement costs of the OPO are eligible for Medicare and 
Medicaid payment under section 1138(b)(1)(F) of the Act.
    Donation service area (DSA) means a geographical area of sufficient 
size to ensure maximum effectiveness in the procurement and equitable 
distribution of organs and that either includes an entire metropolitan 
statistical area or does not include any part of such an area and that 
meets the standards of this subpart.
    Donor means a deceased individual from whom at least one 
vascularized organ (heart, liver, lung, kidney, pancreas, or intestine) 
is recovered for the purpose of transplantation.
    Donor after cardiac death (DCD) means an individual who donates 
after his or her heart has irreversibly stopped beating. A donor after 
cardiac death may be termed a non-heartbeating or asystolic donor.
    Donor document is any documented indication of an individual's 
choice in regard to donation that meets the requirements of the 
governing state law.
    Eligible death for organ donation means the death of a patient 70 
years old or younger, who ultimately is legally declared brain dead 
according to hospital policy independent of family decision regarding 
donation or availability of next-of-kin, independent of medical examiner 
or coroner involvement in the case, and independent of local acceptance 
criteria or transplant center practice, who exhibits none of the 
following:
    (1) Active infections (specific diagnoses).
    (i) Bacterial:
    (A) Tuberculosis.
    (B) Gangrenous bowel or perforated bowel and/or intra-abdominal 
sepsis.
    (ii) Viral:
    (A) HIV infection by serologic or molecular detection.
    (B) Rabies.
    (C) Reactive Hepatitis B Surface Antigen.
    (D) Retroviral infections including HTLV I/II.
    (E) Viral Encephalitis or Meningitis.
    (F) Active Herpes simplex, varicella zoster, or cytomegalovirus 
viremia or pneumonia.
    (G) Acute Epstein Barr Virus (mononucleosis).
    (H) West Nile Virus infection.
    (I) Severe acute respiratory syndrome (SARS).
    (iii) Fungal:
    (A) Active infection with Cryptococcus, Aspergillus, Histoplasma, 
Coccidioides.
    (B) Active candidemia or invasive yeast infection.
    (iv) Parasites: active infection with Trypanosoma cruzi (Chagas'), 
Leishmania, Strongyloides, or Malaria (Plasmodium sp.).
    (v) Prion: Creutzfeldt-Jacob Disease.
    (2) General:
    (i) Aplastic Anemia.
    (ii) Agranulocytosis.
    (iii) Extreme Immaturity (<500 grams or gestational age of <32 
weeks).
    (iv) Current malignant neoplasms except non-melanoma skin cancers 
such as basal cell and squamous cell cancer and primary CNS tumors 
without evident metastatic disease.
    (v) Previous malignant neoplasms with current evident metastatic 
disease.
    (vi) A history of melanoma.

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    (vii) Hematologic malignancies: Leukemia, Hodgkin's Disease, 
Lymphoma, Multiple Myeloma.
    (viii) Multi-system organ failure (MSOF) due to overwhelming sepsis 
or MSOF without sepsis defined as 3 or more systems in simultaneous 
failure for a period of 24 hours or more without response to treatment 
or resuscitation.
    (ix) Active Fungal, Parasitic, viral, or Bacterial Meningitis or 
encephalitis.
    (3) The number of eligible deaths is the denominator for the 
donation rate outcome performance measure as described at Sec.  
486.318(a)(1).
    Eligible donor means any donor that meets the eligible death 
criteria. The number of eligible donors is the numerator of the donation 
rate outcome performance measure.
    Entire metropolitan statistical area means a metropolitan 
statistical area (MSA), a consolidated metropolitan statistical area 
(CMSA), or a primary metropolitan statistical area (PMSA) listed in the 
State and Metropolitan Area Data Book published by the U.S. Bureau of 
the Census. CMS does not recognize a CMSA as a metropolitan area for the 
purposes of establishing a geographical area for an OPO.
    Expected donation rate means the donation rate expected for an OPO 
based on the national experience for OPOs serving similar hospitals and 
donation service areas. This rate is adjusted for the following hospital 
characteristics: Level I or Level II trauma center, Metropolitan 
Statistical Area size, MS Case Mix Index, total bed size, number of 
intensive care unit (ICU) beds, primary service, presence of a 
neurosurgery unit, and hospital control/ownership.
    Observed donation rate is the number of donors meeting the 
eligibility criteria per 100 deaths.
    Open area means an OPO service area for which CMS has notified the 
public that it is accepting applications for designation.
    Organ means a human kidney, liver, heart, lung, pancreas, or 
intestine (or multivisceral organs when transplanted at the same time as 
an intestine).
    Organ procurement organization (OPO) means an organization that 
performs or coordinates the procurement, preservation, and transport of 
organs and maintains a system for locating prospective recipients for 
available organs.
    Re-certification cycle means the 4-year cycle during which an OPO is 
certified.
    Standard criteria donor (SCD) means a donor that meets the 
eligibility criteria for an eligible donor and does not meet the 
criteria to be a donor after cardiac death or expanded criteria donor.
    Transplant hospital means a hospital that provides organ transplants 
and other medical and surgical specialty services required for the care 
of transplant patients. There may be one or more types of organ 
transplant centers operating within the same transplant hospital.
    Urgent need occurs when an OPO's noncompliance with one or more 
conditions for coverage has caused, or is likely to cause, serious 
injury, harm, impairment, or death to a potential or actual donor or an 
organ recipient.

             Requirements for Certification and Designation



Sec.  486.303  Requirements for certification.

    In order to be certified as a qualified organ procurement 
organization, an organ procurement organization must:
    (a) Have received a grant under 42 U.S.C. 273(a) or have been 
certified or re-certified by the Secretary within the previous 4 years 
as being a qualified OPO.
    (b) Be a non-profit entity that is exempt from Federal income 
taxation under section 501 of the Internal Revenue Code of 1986.
    (c) Have accounting and other fiscal procedures necessary to assure 
the fiscal stability of the organization, including procedures to obtain 
payment for kidneys and non-renal organs provided to transplant 
hospitals.
    (d) Have an agreement with CMS, as the Secretary's designated 
representative, to be reimbursed under title XVIII for the procurement 
of kidneys.
    (e) Have been re-certified as an OPO under the Medicare program from 
January 1, 2002 through December 31, 2005.

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    (f) Have procedures to obtain payment for non-renal organs provided 
to transplant centers.
    (g) Agree to enter into an agreement with any hospital or critical 
access hospital in the OPO's service area, including a transplant 
hospital that requests an agreement.
    (h) Meet the conditions for coverage for organ procurement 
organizations, which include both outcome and process performance 
measures.
    (i) Meet the provisions of titles XI, XVIII, and XIX of the Act, 
section 371(b) of the Public Health Services Act, and any other 
applicable Federal regulations.



Sec.  486.304  Requirements for designation.

    (a) Designation is a condition for payment. Payment may be made 
under the Medicare and Medicaid programs for organ procurement costs 
attributable to payments made to an OPO by a hospital only if the OPO 
has been designated by CMS as an OPO.
    (b) An OPO must be certified as a qualified OPO by CMS under 42 
U.S.C. 273(b) and Sec.  486.303 to be eligible for designation.
    (c) An OPO must enter into an agreement with CMS in order for the 
organ procurement costs attributable to the OPO to be reimbursed under 
Medicare and Medicaid.



Sec.  486.306  OPO service area size designation and documentation requirements.

    (a) General documentation requirement. An OPO must make available to 
CMS documentation verifying that the OPO meets the requirements of 
paragraphs (b) through (d) of this section at the time of application 
and throughout the period of its designation.
    (b) Service area designation. The defined service area either 
includes an entire metropolitan statistical area or a New England county 
metropolitan statistical area as specified by the Director of the Office 
of Management and Budget or does not include any part of such an area.
    (c) Service area location and characteristics. An OPO must define 
and document a proposed service area's location through the following 
information:
    (1) The names of counties (or parishes in Louisiana) served or, if 
the service area includes an entire State, the name of the State.
    (2) Geographic boundaries of the service area.
    (3) The number and the names of all hospitals and critical access 
hospitals in the service area that have both a ventilator and an 
operating room.



Sec.  486.308  Designation of one OPO for each service area.

    (a) CMS designates only one OPO per service area. A service area is 
open for competition when the OPO for the service area is de-certified 
and all administrative appeals under Sec.  486.314 are exhausted.
    (b) Designation periods--
    (1) General. An OPO is normally designated for a 4-year agreement 
cycle. The period may be shorter, for example, if an OPO has voluntarily 
terminated its agreement with CMS and CMS selects a successor OPO for 
the balance of the 4-year agreement cycle. In rare situations, a 
designation period may be longer, for example, a designation may be 
extended if additional time is needed to select a successor OPO to an 
OPO that has been de-certified.
    (2) Re-Certification. Re-certification must occur not more 
frequently than once every 4 years.
    (c) Unless CMS has granted a hospital a waiver under paragraphs
    (d) through (f) of this section, the hospital must enter into an 
agreement only with the OPO designated to serve the area in which the 
hospital is located.
    (d) If CMS changes the OPO designated for an area, hospitals located 
in that area must enter into agreements with the newly designated OPO or 
submit a request for a waiver in accordance with paragraph (e) of this 
section within 30 days of notice of the change in designation.
    (e) A hospital may request and CMS may grant a waiver permitting the 
hospital to have an agreement with a designated OPO other than the OPO 
designated for the service area in which the hospital is located. To 
qualify for a waiver, the hospital must submit data to CMS establishing 
that--

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    (1) The waiver is expected to increase organ donations; and
    (2) The waiver will ensure equitable treatment of patients listed 
for transplants within the service area served by the hospital's 
designated OPO and within the service area served by the OPO with which 
the hospital seeks to enter into an agreement.
    (f) In making a determination on waiver requests, CMS considers--
    (1) Cost effectiveness;
    (2) Improvements in quality;
    (3) Changes in a hospital's designated OPO due to changes in the 
definitions of metropolitan statistical areas, if applicable; and
    (4) The length and continuity of a hospital's relationship with an 
OPO other than the hospital's designated OPO.
    (g) A hospital may continue to operate under its existing agreement 
with an out-of-area OPO while CMS is processing the waiver request. If a 
waiver request is denied, a hospital must enter into an agreement with 
the designated OPO within 30 days of notification of the final 
determination.



Sec.  486.309  Re-certification from August 1, 2006 through July 31, 2010.

    An OPO will be considered to be re-certified for the period of 
August 1, 2006 through July 31, 2010 if an OPO met the standards to be a 
qualified OPO within a 4-year period ending December 31, 2001 and has an 
agreement with the Secretary that is scheduled to terminate on July 31, 
2006. Agreements based on the August 1, 2006 through July 31, 2010 re-
certification cycle will end on January 31, 2011.



Sec.  486.310  Changes in control or ownership or service area.

    (a) OPO requirements. (1) A designated OPO considering a change in 
control (see Sec.  413.17(b)(3)) or ownership or in its service area 
must notify CMS before putting it into effect. This notification is 
required to ensure that the OPO, if changed, will continue to satisfy 
Medicare and Medicaid requirements. The merger of one OPO into another 
or the consolidation of one OPO with another is considered a change in 
control or ownership.
    (2) A designated OPO considering a change in its service area must 
obtain prior CMS approval. In the case of a service area change that 
results from a change of control or ownership due to merger or 
consolidation, the OPOs must resubmit the information required in an 
application for designation. The OPO must provide information specific 
to the board structure of the new organization, as well as operating 
budgets, financial information, and other written documentation CMS 
determines to be necessary for designation.
    (b) CMS requirements. (1) If CMS finds that the OPO has changed to 
such an extent that it no longer satisfies the requirements for OPO 
designation, CMS may de-certify the OPO and declare the OPO's service 
area to be an open area. An OPO may appeal such a de-certification as 
set forth in Sec.  486.314. The OPO's service area is not opened for 
competition until the conclusion of the administrative appeals process.
    (2) If CMS finds that the changed OPO continues to satisfy the 
requirements for OPO designation, the period of designation of the 
changed OPO is the remaining portion of the 4-year term of the OPO that 
was reorganized. If more than one designated OPO is involved in the 
reorganization, the remaining designation term is the longest of the 
remaining periods unless CMS determines that a shorter period is in the 
best interest of the Medicare and Medicaid programs. The changed OPO 
must continue to meet the requirements for certification at Sec.  
486.303 throughout the remaining period.

                  Re-Certification and De-Certification



Sec.  486.312  De-certification.

    (a) Voluntary termination of agreement. If an OPO wishes to 
terminate its agreement, the OPO must send CMS written notice of its 
intention to terminate its agreement and the proposed effective date. 
CMS may approve the proposed date, set a different date no later than 6 
months after the proposed effective date, or set a date less than 6 
months after the proposed effective date if it determines that a 
different date would not disrupt services to the

[[Page 170]]

service area. If CMS determines that a designated OPO has ceased to 
furnish organ procurement services to its service area, the cessation of 
services is deemed to constitute a voluntary termination by the OPO, 
effective on a date determined by CMS. CMS will de-certify the OPO as of 
the effective date of the voluntary termination.
    (b) Involuntary termination of agreement. During the term of the 
agreement, CMS may terminate an agreement with an OPO if the OPO no 
longer meets the requirements for certification at Sec.  486.303. CMS 
may also terminate an agreement immediately in cases of urgent need, 
such as the discovery of unsound medical practices. CMS will de-certify 
the OPO as of the effective date of the involuntary termination.
    (c) Non-renewal of agreement. CMS will not voluntarily renew its 
agreement with an OPO if the OPO fails to meet the requirements for 
certification at Sec.  486.318, based on findings from the most recent 
re-certification cycle, or the other requirements for certification at 
Sec.  486.303. CMS will de-certify the OPO as of the ending date of the 
agreement.
    (d) Notice to OPO. Except in cases of urgent need, CMS gives written 
notice of de-certification to an OPO at least 90 days before the 
effective date of the de-certification. In cases of urgent need, CMS 
gives written notice of de-certification to an OPO at least 3 calendar 
days prior to the effective date of the de-certification. The notice of 
de-certification states the reasons for de-certification and the 
effective date.
    (e) Public notice. Once CMS approves the date for a voluntary 
termination, the OPO must provide prompt public notice of the date of 
de-certification and such other information as CMS may require through 
publication in local newspapers in the service area. In the case of 
involuntary termination or non-renewal of an agreement, CMS provides 
public notice of the date of de-certification through publication in 
local newspapers in the service area. No payment under titles XVIII or 
XIX of the Act will be made with respect to organ procurement costs 
attributable to the OPO on or after the effective date of de-
certification.



Sec.  486.314  Appeals.

    If an OPO's de-certification is due to involuntary termination or 
non-renewal of its agreement with CMS, the OPO may appeal the de-
certification on substantive and procedural grounds.
    (a) Notice of initial determination. CMS mails notice to the OPO of 
an initial de-certification determination. The notice contains the 
reasons for the determination, the effect of the determination, and the 
OPO's right to seek reconsideration.
    (b) Reconsideration. (1) Filing request. If the OPO is dissatisfied 
with the de-certification determination, it has 15 business days from 
receipt of the notice of de-certification to seek reconsideration from 
CMS. The request for reconsideration must state the issues or findings 
of fact with which the OPO disagrees and the reasons for disagreement.
    (2) An OPO must seek reconsideration before it is entitled to seek a 
hearing before a hearing officer. If an OPO does not request 
reconsideration or its request is not made timely, the OPO has no right 
to further administrative review.
    (3) Reconsideration determination. CMS makes a written reconsidered 
determination within 10 business days of receipt of the request for 
reconsideration, affirming, reversing, or modifying the initial 
determination and the findings on which it was based. CMS augments the 
administrative record to include any additional materials submitted by 
the OPO, and a copy of the reconsideration decision and sends the 
supplemented administrative record to the CMS hearing officer.
    (c) Request for hearing. An OPO dissatisfied with the CMS 
reconsideration decision, must file a request for a hearing before a CMS 
hearing officer within 40 business days of receipt of the notice of the 
reconsideration determination. If an OPO does not request a hearing or 
its request is not received timely, the OPO has no right to further 
administrative review.
    (d) Administrative record. The hearing officer sends the 
administrative record to both parties within 10 business days of receipt 
of the request for a hearing.

[[Page 171]]

    (1) The administrative record consists of, but is not limited to, 
the following:
    (i) Factual findings from the survey(s) on the OPO conditions for 
coverage.
    (ii) Data from the outcome measures.
    (iii) Rankings of OPOs based on the outcome data.
    (iv) Correspondence between CMS and the affected OPO.
    (2) The administrative record will not include any privileged 
information.
    (e) Pre-Hearing conference. At any time before the hearing, the CMS 
hearing officer may call a pre-hearing conference if he or she believes 
that a conference would more clearly define the issues. At the pre-
hearing conference, the hearing officer may establish the briefing 
schedule, sets the hearing date, and addresses other administrative 
matters. The hearing officer will issue an order reflecting the results 
of the pre-hearing conference.
    (f) Date of hearing. The hearing officer sets a date for the hearing 
that is no more than 60 calendar days following the receipt of the 
request for a hearing.
    (g) Conduct of hearing. (1) The hearing is open to both parties, CMS 
and the OPO.
    (2) The hearing officer inquires fully into all the matters at issue 
and receives in evidence the testimony of witnesses and any documents 
that are relevant and material.
    (3) The hearing officer provides the parties with an opportunity to 
enter an objection to the inclusion of any document. The hearing officer 
will consider the objection and will rule on the document's 
admissibility.
    (4) The hearing officer decides the order in which the evidence and 
the arguments of the parties are presented and the conduct of the 
hearing.
    (5) The hearing officer rules on the admissibility of evidence and 
may admit evidence that would be inadmissible under rules applicable to 
court procedures.
    (6) The hearing officer rules on motions and other procedural items.
    (7) The hearing officer regulates the course of the hearing and 
conduct of counsel.
    (8) The hearing officer may examine witnesses.
    (9) The hearing officer takes any action authorized by the rules in 
this subpart.
    (h) Parties' rights. CMS and the OPO may:
    (1) Appear by counsel or other authorized representative, in all 
hearing proceedings.
    (2) Participate in any pre-hearing conference held by the hearing 
officer.
    (3) Agree to stipulations as to facts which will be made a part of 
the record.
    (4) Make opening statements at the hearing.
    (5) Present relevant evidence on the issues at the hearing.
    (6) Present witnesses, who then must be available for cross-
examination, and cross-examine witnesses presented by the other party.
    (7) Present oral arguments at the hearing.
    (i) Hearing officer's decision. The hearing officer renders a 
decision on the appeal of the notice of de-certification within 20 
business days of the hearing.
    (1) Reversal of de-certification. If the hearing officer reverses 
CMS' determination to de-certify an OPO in a case involving the 
involuntary termination of the OPO's agreement, CMS will not terminate 
the OPO's agreement and will not de-certify the OPO.
    (2) De-certification is upheld. If the de-certification 
determination is upheld by the hearing officer, the OPO is de-certified 
and it has no further administrative appeal rights.
    (j) Extension of agreement. If there is insufficient time prior to 
expiration of an agreement with CMS to allow for competition of the 
service area and, if necessary, transition of the service area to a 
successor OPO, CMS may choose to extend the OPO's agreement with CMS.
    (k) Effects of de-certification. Medicare and Medicaid payments may 
not be made for organ procurement services the OPO furnishes on or after 
the effective date of de-certification. CMS will then open the de-
certified OPO's service area for competition as set forth in Sec.  
486.316(c).

[[Page 172]]



Sec.  486.316  Re-certification and competition processes.

    (a) Re-Certification of OPOs. An OPO is re-certified for an 
additional 4 years and its service area is not opened for competition 
when the OPO:
    (1) Meets all 3 outcome measure requirements at Sec.  486.318; and
    (2) Has been shown by survey to be in compliance with the 
requirements for certification at Sec.  486.303, including the 
conditions for coverage at Sec.  486.320 through Sec.  486.348.
    (b) De-certification and competition. If an OPO does not meet all 3 
outcome measures as described in paragraph (a)(1) of this section or the 
requirements described in paragraph (a)(2) of this section, the OPO is 
de-certified. If the OPO does not appeal or the OPO appeals and the 
reconsideration official and CMS hearing officer uphold the de-
certification, the OPO's service area is opened for competition from 
other OPOs. The de-certified OPO is not permitted to compete for its 
open area or any other open area. An OPO competing for an open service 
area must submit information and data that describe the barriers in its 
service area, how they affected organ donation, what steps the OPO took 
to overcome them, and the results.
    (c) Criteria to compete. To compete for an open service area, an OPO 
must meet the criteria in paragraph (a) of this section and the 
following additional criteria:
    (1) The OPO's performance on the donation rate outcome measure and 
yield outcome measure is at or above 100 percent of the mean national 
rate averaged over the 4 years of the re-certification cycle; and
    (2) The OPO's donation rate is at least 15 percentage points higher 
than the donation rate of the OPO currently designated for the service 
area.
    (3) The OPO must compete for the entire service area.
    (d) Criteria for selection. CMS will designate an OPO for an open 
service area based on the following criteria:
    (1) Performance on the outcome measures at Sec.  486.318;
    (2) Relative success in meeting the process performance measures and 
other conditions at Sec. Sec.  486.320 through 486.348;
    (3) Contiguity to the open service area.
    (4) Success in identifying and overcoming barriers to donation 
within its own service area and the relevance of those barriers to 
barriers in the open area. An OPO competing for an open service area 
must submit information and data that describe the barriers in its 
service area, how they affected organ donation, what steps the OPO took 
to overcome them, and the results.
    (e) No OPO applies. If no OPO applies to compete for a de-certified 
OPO's open area, CMS may select a single OPO to take over the entire 
open area or may adjust the service area boundaries of two or more 
contiguous OPOs to incorporate the open area. CMS will make its decision 
based on the criteria in paragraph (d) of this section.

           Organ Procurement Organization Outcome Requirements



Sec.  486.318  Condition: Outcome measures.

    (a) With the exception of OPOs operating exclusively in non-
contiguous U.S. states, commonwealths, territories, or possessions, an 
OPO must meet all 3 of the following outcome measures:
    (1) The OPO's donation rate of eligible donors as a percentage of 
eligible deaths is no more than 1.5 standard deviations below the mean 
national donation rate of eligible donors as a percentage of eligible 
deaths, averaged over the 4 years of the re-certification cycle. Both 
the numerator and denominator of an individual OPO's donation rate ratio 
are adjusted by adding a 1 for each donation after cardiac death donor 
and each donor over the age of 70;
    (2) The observed donation rate is not significantly lower than the 
expected donation rate for 18 or more months of the 36 months of data 
used for re-certification, as calculated by the SRTR;
    (3) At least 2 out of the 3 following yield measures are no more 
than 1 standard deviation below the national mean, averaged over the 4 
years of the re-certification cycle:

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    (i) The number of organs transplanted per standard criteria donor, 
including pancreata used for islet cell transplantation;
    (ii) The number of organs transplanted per expanded criteria donor, 
including pancreata used for islet cell transplantation; and
    (iii) The number of organs used for research per donor, including 
pancreata used for islet cell research.
    (b) For OPOs operating exclusively in non-contiguous U.S. states, 
commonwealths, territories, and possessions, the OPO outcome measures 
are as follows:
    (1) The OPO's donation rate of eligible donors as a percentage of 
eligible deaths is no more than 1.5 standard deviations below the mean 
national donation rate of eligible donors as a percentage of eligible 
deaths, averaged over the 4 years of the re-certification cycle. Both 
the numerator and denominator of an individual OPO's donation rate ratio 
are adjusted by adding a 1 for each donation after cardiac death donor 
and each donor over the age of 70;
    (2) The observed donation rate is not significantly lower than the 
expected donation rate for 18 or more months of the 36 months of data 
used for re-certification, as calculated by the SRTR;
    (3) At least 2 out of the 3 following are no more than 1 standard 
deviation below the national mean:
    (i) The number of kidneys transplanted per standard criteria donor;
    (ii) The number of kidneys transplanted per expanded criteria donor; 
and
    (iii) The number of organs used for research per donor, including 
pancreata recovered for islet cell transplantation.
    (c) Data for the outcome measures.
    (1) An OPO's performance on the outcome measures is based on 36 
months of data, beginning with January 1 of the first full year of the 
re-certification cycle and ending 36 months later on December 31, 7 
months prior to the end of the re-certification cycle.
    (2) If an OPO takes over another OPO's service area on a date later 
than January 1 of the first full year of the re-certification cycle so 
that 36 months of data are not available to evaluate the OPO's 
performance in its new service area, we will not hold the OPO 
accountable for its performance in the new area until the end of the 
following re-certification cycle when 36 months of data are available.

       Organ Procurement Organization Process Performance Measures



Sec.  486.320  Condition: Participation in Organ Procurement and Transplantation Network.

    After being designated, an OPO must become a member of, participate 
in, and abide by the rules and requirements of the OPTN established and 
operated in accordance with section 372 of the Public Health Service Act 
(42 U.S.C. 274). The term ``rules and requirements of the OPTN'' means 
those rules and requirements approved by the Secretary. No OPO is 
considered out of compliance with section 1138(b)(1)(D) of the Act or 
this section until the Secretary approves a determination that the OPO 
failed to comply with the rules and requirements of the OPTN. The 
Secretary may impose sanctions under section 1138 only after such non-
compliance has been determined in this manner.



Sec.  486.322  Condition: Relationships with hospitals, critical access hospitals, and tissue banks.

    (a) Standard: Hospital agreements. An OPO must have a written 
agreement with 95 percent of the Medicare and Medicaid participating 
hospitals and critical access hospitals in its service area that have 
both a ventilator and an operating room and have not been granted a 
waiver by CMS to work with another OPO. The agreement must describe the 
responsibilities of both the OPO and hospital or critical access 
hospital in regard to donation after cardiac death (if the OPO has a 
protocol for donation after cardiac death) and the requirements for 
hospitals at Sec.  482.45 or Sec.  485.643. The agreement must specify 
the meaning of the terms ``timely referral'' and ``imminent death.''
    (b) Standard: Designated requestor training for hospital staff. The 
OPO must offer to provide designated requestor training on at least an 
annual

[[Page 174]]

basis for hospital and critical access hospital staff.
    (c) Standard: Cooperation with tissue banks.
    (1) The OPO must have arrangements to cooperate with tissue banks 
that have agreements with hospitals and critical access hospitals with 
which the OPO has agreements. The OPO must cooperate in the following 
activities, as may be appropriate, to ensure that all usable tissues are 
obtained from potential donors:
    (i) Screening and referral of potential tissue donors.
    (ii) Obtaining informed consent from families of potential tissue 
donors.
    (iii) Retrieval, processing, preservation, storage, and distribution 
of tissues.
    (iv) Providing designated requestor training.
    (2) An OPO is not required to have an arrangement with a tissue bank 
that is unwilling to have an arrangement with the OPO.



Sec.  486.324  Condition: Administration and governing body.

    (a) While an OPO may have more than one board, the OPO must have an 
advisory board that has both the authority described in paragraph (b) of 
this section and the following membership:
    (1) Members who represent hospital administrators, either intensive 
care or emergency room personnel, tissue banks, and voluntary health 
associations in the OPO's service area.
    (2) Individuals who represent the public residing in the OPO's 
service area.
    (3) A physician with knowledge, experience, or skill in the field of 
human histocompatibility, or an individual with a doctorate degree in a 
biological science and with knowledge, experience, or skills in the 
field of human histocompatibility.
    (4) A neurosurgeon or other physician with knowledge or skills in 
the neurosciences.
    (5) A transplant surgeon representing each transplant hospital in 
the service area with which the OPO has arrangements to coordinate its 
activities. The transplant surgeon must have practicing privileges and 
perform transplants in the transplant hospital represented.
    (6) An organ donor family member.
    (b) The OPO board described in paragraph (a) of this section has the 
authority to recommend policies for the following:
    (1) Procurement of organs.
    (2) Effective agreements to identify potential organ donors with a 
substantial majority of hospitals in its service area that have 
facilities for organ donation.
    (3) Systematic efforts, including professional education, to acquire 
all useable organs from potential donors.
    (4) Arrangements for the acquisition and preservation of donated 
organs and provision of quality standards for the acquisition of organs 
that are consistent with the standards adopted by the OPTN, including 
arranging for testing with respect to preventing the acquisition of 
organs that are infected with the etiologic agent for acquired 
immunodeficiency syndrome (AIDS).
    (5) Appropriate tissue typing of organs.
    (6) A system for allocation of organs among transplant patients that 
is consistent with the rules and requirements of the OPTN, as defined in 
Sec.  486.320 of this part.
    (7) Transportation of organs to transplant hospitals.
    (8) Coordination of activities with transplant hospitals in the 
OPO's service area.
    (9) Participation in the OPTN.
    (10) Arrangements to cooperate with tissue banks for the retrieval, 
processing, preservation, storage, and distribution of tissues as may be 
appropriate to assure that all useable tissues are obtained from 
potential donors.
    (11) Annual evaluation of the effectiveness of the OPO in acquiring 
organs.
    (12) Assistance to hospitals in establishing and implementing 
protocols for making routine inquiries about organ donations by 
potential donors.
    (c) The advisory board described in paragraph (a) of this section 
has no authority over any other activity of the OPO and may not serve as 
the OPO's governing body or board of directors. Members of the advisory 
board described in paragraph (a) of this section

[[Page 175]]

are prohibited from serving on any other OPO board.
    (d) The OPO must have bylaws for each of its board(s) that address 
potential conflicts of interest, length of terms, and criteria for 
selecting and removing members. (e) A governing body must have full 
legal authority and responsibility for the management and provision of 
all OPO services and must develop and oversee implementation of policies 
and procedures considered necessary for the effective administration of 
the OPO, including fiscal operations, the OPO's quality assessment and 
performance improvement (QAPI) program, and services furnished under 
contract or arrangement, including agreements for these services. The 
governing body must appoint an individual to be responsible for the day-
to-day operation of the OPO.
    (e) A governing body must have full legal authority and 
responsibility for the management and provision of all OPO services and 
must develop and oversee implementation of policies and procedures 
considered necessary for the effective administration of the OPO, 
including fiscal operations, the OPO's quality assessment and 
performance improvement (QAPI) program, and services furnished under 
contract or arrangement, including agreements for these services. The 
governing body must appoint an individual to be responsible for the day-
to-day operation of the OPO.
    (f) The OPO must have procedures to address potential conflicts of 
interest for the governing body described in paragraph (d) of this 
section.
    (g) The OPO's policies must state whether the OPO recovers organs 
from donors after cardiac death.



Sec.  486.326  Condition: Human resources.

    All OPOs must have a sufficient number of qualified staff, including 
a director, a medical director, organ procurement coordinators, and 
hospital development staff to obtain all usable organs from potential 
donors, and to ensure that required services are provided to families of 
potential donors, hospitals, tissue banks, and individuals and 
facilities that use organs for research.
    (a) Standard: Qualifications. (1) The OPO must ensure that all 
individuals who provide services and/or supervise services, including 
services furnished under contract or arrangement, are qualified to 
provide or supervise the services.
    (2) The OPO must develop and implement a written policy that 
addresses potential conflicts of interest for the OPO's director, 
medical director, senior management, and procurement coordinators.
    (3) The OPO must have credentialing records for physicians and other 
practitioners who routinely recover organs in hospitals under contract 
or arrangement with the OPO and ensure that all physicians and other 
practitioners who recover organs in hospitals with which the OPO has 
agreements are qualified and trained.
    (b) Standard: Staffing. (1) The OPO must provide sufficient 
coverage, either by its own staff or under contract or arrangement, to 
assure both that hospital referral calls are screened for donor 
potential and that potential donors are evaluated for medical 
suitability for organ and/or tissue donation in a timely manner.
    (2) The OPO must have a sufficient number of qualified staff to 
provide information and support to potential organ donor families; 
request consent for donation; ensure optimal maintenance of the donor, 
efficient placement of organs, and adequate oversight of organ recovery; 
and conduct QAPI activities, such as death record reviews and hospital 
development.
    (3) The OPO must provide a sufficient number of recovery personnel, 
either from its own staff or under contract or arrangement, to ensure 
that all usable organs are recovered in a manner that, to the extent 
possible, preserves them for transplantation.
    (c) Standard: Education, training, and performance evaluation. The 
OPO must provide its staff with the education, training, and supervision 
necessary to furnish required services. Training must include but is not 
limited to performance expectations for staff, applicable organizational 
policies and procedures, and QAPI activities. OPOs must evaluate the 
performance of their staffs and provide training, as needed,

[[Page 176]]

to improve individual and overall staff performance and effectiveness.
    (d) Standard: Medical director. The OPO's medical director is a 
physician licensed in at least one of the States or territories within 
the OPO's service area or as required by State or territory law or by 
the jurisdiction in which the OPO is located. The medical director is 
responsible for implementation of the OPO's protocols for donor 
evaluation and management and organ recovery and placement. The medical 
director is responsible for oversight of the clinical management of 
potential donors, including providing assistance in managing a donor 
case when the surgeon on call is unavailable.



Sec.  486.328  Condition: Reporting of data.

    (a) An OPO must provide individually-identifiable, hospital-specific 
organ donation and transplantation data and other information to the 
Organ Procurement and Transplantation Network, the Scientific Registry 
of Transplant Recipients, and DHHS, as requested by the Secretary. The 
data may include, but are not limited to:
    (1) Number of hospital deaths;
    (2) Results of death record reviews;
    (3) Number and timeliness of referral calls from hospitals;
    (4) Number of eligible deaths;
    (5) Data related to non-recovery of organs;
    (6) Data about consents for donation;
    (7) Number of eligible donors;
    (8) Number of organs recovered, by type of organ; and
    (9) Number of organs transplanted, by type of organ.
    (b) An OPO must provide hospital-specific organ donation data 
annually to the transplant hospitals with which it has agreements.
    (c) Data to be used for OPO re-certification purposes must be 
reported to the OPTN and must include data for all deaths in all 
hospitals and critical access hospitals in the OPO's donation service 
area, unless a hospital or critical access hospital has been granted a 
waiver to work with a different OPO.
    (d) Data reported by the OPO to the OPTN must be reported within 30 
days after the end of the month in which a death occurred. If an OPO 
determines through death record review or other means that the data it 
reported to the OPTN was incorrect, it must report the corrected data to 
the OPTN within 30 days of the end of the month in which the error is 
identified.
    (e) For the purpose of determining the information to be collected 
under paragraph (a) of this section, the following definitions apply:
    (1) Kidneys procured. Each kidney recovered will be counted 
individually. En bloc kidneys recovered will count as two kidneys 
procured.
    (2) Kidneys transplanted. Each kidney transplanted will be counted 
individually. En bloc kidney transplants will be counted as two kidneys 
transplanted.
    (3) Extra-renal organs procured. Each organ recovered is counted 
individually.
    (4) Extra-renal organs transplanted. Each organ or part thereof 
transplanted will be counted individually. For example, a single liver 
is counted as one organ procured and each portion that is transplanted 
will count as one transplant. Further, a heart and double lung 
transplant will be counted as three organs transplanted. A kidney/
pancreas transplant will count as one kidney transplanted and one extra-
renal organ transplanted.



Sec.  486.330  Condition: Information management.

    An OPO must establish and use an electronic information management 
system to maintain the required medical, social and identifying 
information for every donor and transplant recipient and develop and 
follow procedures to ensure the confidentiality and security of the 
information.
    (a) Donor information. The OPO must maintain a record for every 
donor. The record must include, at a minimum, information identifying 
the donor (for example, name, address, date of birth, social security 
number or other unique identifier, such as Medicare health insurance 
claim number), organs and (when applicable) tissues recovered, date of 
the organ recovery, donor management data, all test results, current 
hospital history, past medical and social history, the pronouncement of

[[Page 177]]

death, and consent and next-of-kin information.
    (b) Disposition of organs. The OPO must maintain records showing the 
disposition of each organ recovered for the purpose of transplantation, 
including information identifying transplant recipients.
    (c) Data retention. Donor and transplant recipient records must be 
maintained in a human readable and reproducible paper or electronic 
format for 7 years.
    (d) Format of records. The OPO must maintain data in a format that 
can readily be transferred to a successor OPO and in the event of a 
transfer must provide to CMS copies of all records, data, and software 
necessary to ensure uninterrupted service by a successor OPO. Records 
and data subject to this requirement include donor and transplant 
recipient records and procedural manuals and other materials used in 
conducting OPO operations.



Sec.  486.342  Condition: Requesting consent.

    An OPO must encourage discretion and sensitivity with respect to the 
circumstances, views, and beliefs of potential donor families.
    (a) An OPO must have a written protocol to ensure that, in the 
absence of a donor document, the individual(s) responsible for making 
the donation decision are informed of their options to donate organs or 
tissues (when the OPO is making a request for tissues) or to decline to 
donate. The OPO must provide to the individual(s) responsible for making 
the donation decision, at a minimum, the following:
    (1) A list of the organs and/or tissues that may be recovered.
    (2) The most likely uses for the donated organs or tissues.
    (3) A description of the screening and recovery processes.
    (4) Information about the organizations that will recover, process, 
and distribute the tissue.
    (5) Information regarding access to and release of the donor's 
medical records.
    (6) An explanation of the impact the donation process will have on 
burial arrangements and the appearance of the donor's body.
    (7) Contact information for individual(s) with questions or 
concerns.
    (8) A copy of the signed consent form if a donation is made.
    (b) If an OPO does not request consent to donation because a 
potential donor consented to donation before his or her death in a 
manner that satisfied applicable State law requirements in the potential 
donor's State of residence, the OPO must provide information about the 
donation to the family of the potential donor, as requested.



Sec.  486.344  Condition: Evaluation and management of potential donors and organ placement and recovery.

    The OPO must have written protocols for donor evaluation and 
management and organ placement and recovery that meet current standards 
of practice and are designed to maximize organ quality and optimize the 
number of donors and the number of organs recovered and transplanted per 
donor.
    (a) Potential donor protocol management. (1) The medical director is 
responsible for ensuring that potential donor evaluation and management 
protocols are implemented correctly and appropriately to ensure that 
potential donors are thoroughly assessed for medical suitability for 
organ donation and clinically managed to optimize organ viability and 
function.
    (2) The OPO must implement a system that ensures that a qualified 
physician or other qualified individual is available to assist in the 
medical management of a potential donor when the surgeon on call is 
unavailable.
    (b) Potential donor evaluation. The OPO must do the following:
    (1) Verify that death has been pronounced according to applicable 
local, State, and Federal laws.
    (2) Determine whether there are conditions that may influence donor 
acceptance.
    (3) If possible, obtain the potential donor's medical and social 
history.
    (4) Review the potential donor's medical chart and perform a 
physical examination of the donor.
    (5) Obtain the potential donor's vital signs and perform all 
pertinent tests.

[[Page 178]]

    (c) Testing. The OPO must do the following:
    (1) Arrange for screening and testing of the potential donor for 
infectious disease according to current standards of practice, including 
testing for the human immunodeficiency virus.
    (2) Ensure that screening and testing of the potential donor 
(including point-of-care testing and blood typing) are conducted by a 
laboratory that is certified in the appropriate specialty or 
subspecialty of service in accordance with part 493 of this chapter.
    (3) Ensure that the potential donor's blood is typed using two 
separate blood samples.
    (4) Document potential donor's record with all test results, 
including blood type, before organ recovery.
    (d) Standard: Collaboration with transplant programs. (1) The OPO 
must establish protocols in collaboration with transplant programs that 
define the roles and responsibilities of the OPO and the transplant 
program for all activities associated with the evaluation and management 
of potential donors, organ recovery, and organ placement, including 
donation after cardiac death, if the OPO has implemented a protocol for 
donation after cardiac death.
    (2) The protocol must ensure that:
    (i) The OPO is responsible for two separate determinations of the 
donor's blood type;
    (ii) If the identify of the intended recipient is known, the OPO has 
a procedure to ensure that prior to organ recovery, an individual from 
the OPO's staff compares the blood type of the donor with the blood type 
of the intended recipient, and the accuracy of the comparison is 
verified by a different individual;
    (iii) Documentation of the donor's blood type accompanies the organ 
to the hospital where the transplant will take place.
    (3) The established protocols must be reviewed regularly with the 
transplant programs to incorporate practices that have been shown to 
maximize organ donation and transplantation.
    (e) Documentation of recipient information. If the intended 
recipient has been identified prior to recovery of an organ for 
transplantation, the OPO must have written documentation from the OPTN 
showing, at a minimum, the intended organ recipient's ranking in 
relation to other suitable candidates and the recipient's OPTN 
identification number and blood type.
    (f) Donation after cardiac death. If an OPO recovers organs from 
donors after cardiac death, the OPO must have protocols that address the 
following:
    (1) Criteria for evaluating patients for donation after cardiac 
death;
    (2) Withdrawal of support, including the relationship between the 
time of consent to donation and the withdrawal of support;
    (3) Use of medications and interventions not related to withdrawal 
of support;
    (4) Involvement of family members prior to organ recovery;
    (5) Criteria for declaration of death and the time period that must 
elapse prior to organ recovery.
    (g) Organ allocation. The OPO must have a system to allocate donated 
organs among transplant patients that is consistent with the rules and 
requirements of the OPTN, as defined in Sec.  486.320 of this part.
    (h) Organ placement. The OPO must develop and implement a protocol 
to maximize placement of organs for transplantation.



Sec.  486.346  Condition: Organ preparation and transport.

    (a) The OPO must arrange for testing of organs for infectious 
disease and tissue typing of organs according to current standards of 
practice. The OPO must ensure that testing and tissue typing of organs 
are conducted by a laboratory that is certified in the appropriate 
specialty or subspecialty of service in accordance with part 493 of this 
chapter.
    (b) The OPO must send complete documentation of donor information to 
the transplant center with the organ, including donor evaluation, the 
complete record of the donor's management, documentation of consent, 
documentation of the pronouncement of death, and documentation for 
determining organ quality. Two individuals, one of whom must be an OPO 
employee, must verify that the documentation that accompanies an organ 
to a transplant center is correct.

[[Page 179]]

    (c) The OPO must develop and follow a written protocol for 
packaging, labeling, handling, and shipping organs in a manner that 
ensures their arrival without compromise to the quality of the organ. 
The protocol must include procedures to check the accuracy and integrity 
of labels, packaging, and contents prior to transport, including 
verification by two individuals, one of whom must be an OPO employee, 
that information listed on the labels is correct.
    (d) All packaging in which an organ is transported must be marked 
with the identification number, specific contents, and donor's blood 
type.



Sec.  486.348  Condition: Quality assessment and performance improvement (QAPI).

    The OPO must develop, implement, and maintain a comprehensive, data-
driven QAPI program designed to monitor and evaluate performance of all 
donation services, including services provided under contract or 
arrangement.
    (a) Standard: Components of a QAPI program. The OPO's QAPI program 
must include objective measures to evaluate and demonstrate improved 
performance with regard to OPO activities, such as hospital development, 
designated requestor training, donor management, timeliness of on-site 
response to hospital referrals, consent practices, organ recovery and 
placement, and organ packaging and transport. The OPO must take actions 
that result in performance improvements and track performance to ensure 
that improvements are sustained.
    (b) Standard: Death record reviews. As part of its ongoing QAPI 
efforts, an OPO must conduct at least monthly death record reviews in 
every Medicare and Medicaid participating hospital in its service area 
that has a Level I or Level II trauma center or 150 or more beds, a 
ventilator, and an intensive care unit (unless the hospital has a waiver 
to work with another OPO), with the exception of psychiatric and 
rehabilitation hospitals. When missed opportunities for donation are 
identified, the OPO must implement actions to improve performance.
    (c) Standard: Adverse events. (1) An OPO must establish written 
policies to address, at a minimum, the process for identification, 
reporting, analysis, and prevention of adverse events that occur during 
the organ donation process.
    (2) The OPO must conduct a thorough analysis of any adverse event 
and must use the analysis to affect changes in the OPO's policies and 
practices to prevent repeat incidents.



PART 488_SURVEY, CERTIFICATION, AND ENFORCEMENT PROCEDURES--Table of Contents




                      Subpart A_General Provisions

Sec.
488.1 Definitions.
488.2 Statutory basis.
488.3 Conditions of participation; conditions for coverage; and long-
          term care requirements.
488.4 Application and reapplication procedures for accreditation 
          organizations.
488.5 Effect of JCAHO or AOA accreditation of hospitals.
488.6 Other national accreditation programs for hospitals and other 
          providers and suppliers.
488.7 Validation survey.
488.8 Federal review of accreditation organizations.
488.9 Onsite observation of accreditation organization operations.
488.10 State survey agency review: Statutory provisions.
488.11 State survey agency functions.
488.12 Effect of survey agency certification.
488.14 Effect of QIO review.
488.18 Documentation of findings.
488.20 Periodic review of compliance and approval.
488.24 Certification of noncompliance.
488.26 Determining compliance.
488.28 Providers or suppliers, other than SNFs and NFs, with 
          deficiencies.
488.30 Revisit user fee for revisit surveys.

                     Subpart B_Special Requirements

488.52 [Reserved]
488.54 Temporary waivers applicable to hospitals.
488.56 Temporary waivers applicable to skilled nursing facilities.
488.60 Special procedures for approving end stage renal disease 
          facilities.
488.61 Special procedures for approval and re-approval of organ 
          transplant centers.
488.64 Remote facility variances for utilization review requirements.

[[Page 180]]

488.68 State Agency responsibilities for OASIS collection and data base 
          requirements.

                  Subpart C_Survey Forms and Procedures

488.100 Long term care survey forms, Part A.
488.105 Long term care survey forms, Part B.
488.110 Procedural guidelines.
488.115 Care guidelines.

 Subpart D_Reconsideration of Adverse Determinations_Deeming Authority 
for Accreditation Organizations and CLIA Exemption of Laboratories Under 
                             State Programs

488.201 Reconsideration.
488.203 Withdrawal of request for reconsideration.
488.205 Right to informal hearing.
488.207 Informal hearing procedures.
488.209 Hearing officer's findings.
488.211 Final reconsideration determination.

     Subpart E_Survey and Certification of Long-Term Care Facilities

488.300 Statutory basis.
488.301 Definitions.
488.303 State plan requirement.
488.305 Standard surveys.
488.307 Unannounced surveys.
488.308 Survey frequency.
488.310 Extended survey.
488.312 Consistency of survey results.
488.314 Survey teams.
488.318 Inadequate survey performance.
488.320 Sanctions for inadequate survey performance.
488.325 Disclosure of results of surveys and activities.
488.330 Certification of compliance or noncompliance.
488.331 Informal dispute resolution.
488.332 Investigation of complaints of violations and monitoring of 
          compliance.
488.334 Educational programs.
488.335 Action on complaints of resident neglect and abuse, and 
          misappropriation of resident property.

 Subpart F_Enforcement of Compliance For Long-Term Care Facilities with 
                              Deficiencies

488.400 Statutory basis.
488.401 Definitions.
488.402 General provisions.
488.404 Factors to be considered in selecting remedies.
488.406 Available remedies.
488.408 Selection of remedies.
488.410 Action when there is immediate jeopardy.
488.412 Action when there is no immediate jeopardy.
488.414 Action when there is repeated substandard quality of care.
488.415 Temporary management.
488.417 Denial of payment for all new admissions.
488.418 Secretarial authority to deny all payments.
488.422 State monitoring.
488.424 Directed plan of correction.
488.425 Directed inservice training.
488.426 Transfer of residents, or closure of the facility and transfer 
          of residents.
488.430 Civil money penalties: Basis for imposing penalty.
488.432 Civil money penalties: When a penalty is collected.
488.434 Civil money penalties: Notice of penalty.
488.436 Civil money penalties: Waiver of hearing, reduction of penalty 
          amount.
488.438 Civil money penalties: Amount of penalty.
488.440 Civil money penalties: Effective date and duration of penalty.
488.442 Civil money penalties: Due date for payment of penalty.
488.444 Civil money penalties: Settlement of penalties.
488.450 Continuation of payments to a facility with deficiencies.
488.452 State and Federal disagreements involving findings not in 
          agreement in non-State operated NFs and dually participating 
          facilities when there is no immediate jeopardy.
488.454 Duration of remedies.
488.456 Termination of provider agreement.

Subpart G [Reserved]

Subpart H_Termination of Medicare Coverage and Alternative Sanctions for 
                End-Stage Renal Disease (ESRD) Facilities

488.604 Termination of Medicare coverage.
488.606 Alternative sanctions.
488.608 Notice of alternative sanction and appeal rights: Termination of 
          coverage.
488.610 Notice of appeal rights: Alternative sanctions.

    Authority: Secs. 1102 and 1871 of the Social Security Act, unless 
otherwise noted (42 U.S.C. 1302 and 1395(hh)); Continuing Resolution 
Pub. L. 110-149 H.J. Res. 72.

    Source: 53 FR 22859, June 17, 1988, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  488.1  Definitions.

    As used in this part--

[[Page 181]]

    Accredited provider or supplier means a provider or supplier that 
has voluntarily applied for and has been accredited by a national 
accreditation program meeting the requirements of and approved by CMS in 
accordance with Sec.  488.5 or Sec.  488.6.
    Act means the Social Security Act.
    AOA stands for the American Osteopathic Association.
    Certification is a recommendation made by the State survey agency on 
the compliance of providers and suppliers with the conditions of 
participation, requirements (for SNFs and NFs), and conditions of 
coverage.
    Conditions for coverage means the requirements suppliers must meet 
to participate in the Medicare program.
    Conditions of participation means the requirements providers other 
than skilled nursing facilities must meet to participate in the Medicare 
program and includes conditions of certification for rural health 
clinics.
    Full review means a survey of a hospital for compliance with all 
conditions of participation for hospitals.
    JCAHO stands for the Joint Commission on Accreditation of Healthcare 
Organizations.
    Medicare condition means any condition of participation or for 
coverage, including any long term care requirements.
    Provider of services or provider means a hospital, critical access 
hospital, skilled nursing facility, nursing facility, home health 
agency, hospice, comprehensive outpatient rehabilitation facility, or 
provider of outpatient physical therapy or speech pathology services.
    Rate of disparity means the percentage of all sample validation 
surveys for which a State survey agency finds noncompliance with one or 
more Medicare conditions and no comparable condition level deficiency 
was cited by the accreditation organization, where it is reasonable to 
conclude that the deficiencies were present at the time of the 
accreditation organization's most recent surveys of providers or 
suppliers of the same type.

    Example:  Assume that during a validation review period State survey 
agencies perform validation surveys at 200 facilities of the same type 
(for example, ambulatory surgical centers, home health agencies) 
accredited by the same accreditation organization. The State survey 
agencies find 60 of the facilities out of compliance with one or more 
Medicare conditions, and it is reasonable to conclude that these 
deficiencies were present at the time of the most recent survey by an 
accreditation organization. The accreditation organization, however, has 
found deficiencies comparable to the condition level deficiencies at 
only 22 of the 60 facilities. These validation results would yield ((60-
22)/200) a rate of disparity of 19 percent.

    Reasonable assurance means that an accreditation organization has 
demonstrated to CMS's satisfaction that its requirements, taken as a 
whole, are at least as stringent as those established by CMS, taken as a 
whole.
    State includes the District of Columbia, the Commonwealth of Puerto 
Rico, the Virgin Islands, Guam, and American Samoa.
    State survey agency means the State health agency or other 
appropriate State or local agency used by HFCA to perform survey and 
review functions for Medicare.
    Substantial allegation of noncompliance means a complaint from any 
of a variety of sources (including complaints submitted in person, by 
telephone, through written correspondence, or in newspaper or magazine 
articles) that, if substantiated, would affect the health and safety of 
patients and raises doubts as to a provider's or supplier's 
noncompliance with any Medicare condition.
    Supplier means any of the following: Independent laboratory; 
portable X-ray services; physical therapist in independent practice; 
ESRD facility; rural health clinic; Federally qualified health center; 
chiropractor; or ambulatory surgical center.
    Validation review period means the one year period during which CMS 
conducts a review of the validation surveys and evaluates the results of 
the most recent surveys performed by the accreditation organization.

[53 FR 22859, June 17, 1988, as amended at 54 FR 5373, Feb. 2, 1989; 56 
FR 48879, Sept. 26, 1991; 57 FR 24982, June 12, 1992; 58 FR 30676, May 
26, 1993; 58 FR 61838, Nov. 23, 1993; 62 FR 46037, Aug. 29, 1997; 71 FR 
68230, Nov. 24, 2006]

[[Page 182]]



Sec.  488.2  Statutory basis.

    This part is based on the indicated provisions of the following 
sections of the Act:

1128--Exclusion of entities from participation in Medicare.
1128A--Civil money penalties.
1814--Conditions for, and limitations on, payment for Part A services.
1819--Requirements for SNFs.
1861(f)--Requirements for psychiatric hospitals.
1861(z)--Institutional planning standards that hospitals and SNFs must 
meet.
1861(ee)--Discharge planning guidelines for hospitals.
1861(ss)(2)--Accreditation of religious nonmedical health care 
institutions.
1864--Use of State survey agencies.
1865--Effect of accreditation.
1880--Requirements for hospitals and SNFs of the Indian Health Service.
1883--Requirements for hospitals that provide SNF care.
1902--Requirements for participation in the Medicaid program.
1913--Medicaid requirements for hospitals that provide NF care.
1919--Medicaid requirements for NFs.

[60 FR 50443, Sept. 29, 1995, as amended at 64 FR 67052, Nov. 30, 1999]



Sec.  488.3  Conditions of participation; conditions for coverage; and long-term care requirements.

    (a) Basic rules. In order to be approved for participation in or 
coverage under the Medicare program, a prospective provider or supplier 
must:
    (1) Meet the applicable statutory definition in section 1138(b), 
1819, 1832(a)(2)(F), 1861, 1881, or 1919 of the Act; and
    (2) Be in compliance with the applicable conditions or long-term 
care requirements prescribed in subpart N, Q or U of part 405, part 416, 
subpart C of part 418, part 482, part 483, part 484, part 485, subpart A 
of part 491, or part 494 of this chapter.
    (b) Special Conditions. (1) The Secretary, after consultation with 
the JCAHO or AOA, may issue conditions of participation for hospitals 
higher or more precise than those of either those accrediting bodies.
    (2) The Secretary may, at a State's request, approve health and 
safety requirements for providers and suppliers in that State, which are 
higher than those otherwise applied in the Medicare program.
    (3) If a State or political subdivision imposes higher requirements 
on institutions as a condition for the purchase of health services under 
a State Medicaid Plan approved under Title XIX of the Act, (or if Guam, 
Puerto Rico, or the Virgin Islands does so under a State plan for Old 
Age Assistance under Title I of the Act, or for Aid to the Aged, Blind, 
and Disabled under the original Title XVI of the Act), the Secretary is 
required to impose similar requirements as a condition for payment under 
Medicare in that State or political subdivision.

[53 FR 22859, June 17, 1988, as amended at 58 FR 61838, Nov. 23, 1993]



Sec.  488.4  Application and reapplication procedures for accreditation organizations.

    (a) A national accreditation organization applying for approval of 
deeming authority for Medicare requirements under Sec.  488.5 or 488.6 
of this subpart must furnish to CMS the information and materials 
specified in paragraphs (a)(1) through (10) of this section. A national 
accreditation organization reapplying for approval must furnish to CMS 
whatever information and materials from paragraphs (a)(1) through (10) 
of this section that CMS requests. The materials and information are--
    (1) The types of providers and suppliers for which the organization 
is requesting approval;
    (2) A detailed comparison of the organization's accreditation 
requirements and standards with the applicable Medicare requirements 
(for example, a crosswalk);
    (3) A detailed description of the organization's survey process, 
including--
    (i) Frequency of the surveys performed;
    (ii) Copies of the organization's survey forms, guidelines and 
instructions to surveyors;
    (iii) Accreditation survey review process and the accreditation 
status decision-making process;
    (iv) Procedures used to notify accredited facilities of deficiencies 
and the

[[Page 183]]

procedures used to monitor the correction of deficiencies in accredited 
facilities; and
    (v) Whether surveys are announced or unannounced;
    (4) Detailed information about the individuals who perform surveys 
for the accreditation organization, including--
    (i) The size and composition of accreditation survey teams for each 
type of provider and supplier accredited;
    (ii) The education and experience requirements surveyors must meet;
    (iii) The content and frequency of the in-service training provided 
to survey personnel;
    (iv) The evaluation systems used to monitor the performance of 
individual surveyors and survey teams; and
    (v) Policies and procedures with respect to an individual's 
participation in the survey or accreditation decision process of any 
facility with which the individual is professionally or financially 
affiliated;
    (5) A description of the organization's data management and analysis 
system with respect to its surveys and accreditation decisions, 
including the kinds of reports, tables, and other displays generated by 
that system;
    (6) The organization's procedures for responding to and for the 
investigation of complaints against accredited facilities, including 
policies and procedures regarding coordination of these activities with 
appropriate licensing bodies and ombudsmen programs;
    (7) The organization's policies and procedures with respect to the 
withholding or removal of accreditation status for facilities that fail 
to meet the accreditation organization's standards or requirements, and 
other actions taken by the organization in response to noncompliance 
with its standards and requirements;
    (8) A description of all types (for example, full, partial, type of 
facility, etc.) and categories (provisional, conditional, temporary, 
etc.) of accreditation offered by the organization, the duration of each 
type and category of accreditation and a statement specifying the types 
and categories of accreditation for which approval of deeming authority 
is sought;
    (9) A list of all currently accredited facilities, the type and 
category of accreditation currently held by each facility, and the 
expiration date of each facility's current accreditation; and
    (10) A list of all full and partial accreditation surveys scheduled 
to be performed by the organization.
    (b) The accreditation organization must also submit the following 
supporting documentation--
    (1) A written presentation that demonstrates the organization's 
ability to furnish CMS with electronic data in ASCII comparable code;
    (2) A resource analysis that demonstrates that the organization's 
staffing, funding and other resources are adequate to perform the 
required surveys and related activities; and
    (3) A statement acknowledging that as a condition for approval of 
deeming authority, the organization will agree to--
    (i) Notify CMS in writing of any facility that has had its 
accreditation revoked, withdrawn, or revised, or that has had any other 
remedial or adverse action taken against it by the accreditation 
organization within 30 days of any such action taken;
    (ii) Notify all accredited facilities within 10 days of CMS's 
withdrawal of the organization's approval of deeming authority;
    (iii) Notify CMS in writing at least 30 days in advance of the 
effective date of any proposed changes in accreditation requirements;
    (iv) Within 30 days of a change in CMS requirements, submit to CMS 
an acknowledgement of CMS's notification of the change as well as a 
revised crosswalk reflecting the new requirements and inform CMS about 
how the organization plans to alter its requirements to conform to CMS's 
new requirements;
    (v) Permit its surveyors to serve as witnesses if CMS takes an 
adverse action based on accreditation findings;
    (vi) [Reserved]
    (vii) Notify CMS in writing within ten days of a deficiency 
identified in any accreditation entity where the deficiency poses an 
immediate jeopardy to the entity's patients or residents or a hazard to 
the general public; and
    (viii) Conform accreditation requirements to changes in Medicare 
requirements.

[[Page 184]]

    (c) If CMS determines that additional information is necessary to 
make a determination for approval or denial of the accreditation 
organization's application for deeming authority, the organization will 
be notified and afforded an opportunity to provide the additional 
information.
    (d) CMS may visit the organization's offices to verify 
representations made by the organization in its application, including, 
but not limited to, review of documents and interviews with the 
organization's staff.
    (e) The accreditation organization will receive a formal notice from 
CMS stating whether the request for deeming authority has been approved 
or denied, the rationale for any denial, and reconsideration and 
reapplication procedures.
    (f) An accreditation organization may withdraw its application for 
approval of deeming authority at any time before the formal notice 
provided for in paragraph (e) of this section is received.
    (g) Except as provided in paragraph (i) of this section, an 
accreditation organization that has been notified that its request for 
deeming authority has been denied may request a reconsideration of that 
determination in accordance with subpart D of this part.
    (h) Except as provided in paragraph (i) of this section, any 
accreditation organization whose request for approval of deeming 
authority has been denied may resubmit its application if the 
organization--
    (1) Has revised its accreditation program to address the rationale 
for denial of its previous request;
    (2) Can demonstrate that it can provide reasonable assurance that 
its accredited facilities meet applicable Medicare requirements; and
    (3) Resubmits the application in its entirety.
    (i) If an accreditation organization has requested, in accordance 
with part 488, subpart D of this chapter, a reconsideration of CMS's 
determination that its request for deeming approval is denied, it may 
not submit a new application for deeming authority for the type of 
provider or supplier that is at issue in the reconsideration until the 
reconsideration is administratively final.

[58 FR 61838, Nov. 23, 1993]



Sec.  488.5  Effect of JCAHO or AOA accreditation of hospitals.

    (a) Deemed to meet. Institutions accredited as hospitals by the 
JCAHO or AOA are deemed to meet all of the Medicare conditions of 
participation for hospitals, except--
    (1) The requirement for utilization review as specified in section 
1861(e)(6) of the Act and in Sec.  482.30 of this chapter;
    (2) The additional special staffing and medical records requirements 
that are considered necessary for the provision of active treatment in 
psychiatric hospitals (section 1861(f) of the Act) and implementing 
regulations; and
    (3) Any requirements under section 1861(e) of the Act and 
implementing regulations that CMS, after consulting with JCAHO or AOA, 
identifies as being higher or more precise than the requirements for 
accreditation (section 1865(a)(4) of the Act).
    (b) Deemed status for providers and suppliers that participate in 
the Medicaid program. Eligibility for Medicaid participation can be 
established through Medicare deemed status for providers and suppliers 
that are not required under Medicaid regulations to comply with any 
requirements other than Medicare participation requirements for that 
provider r supplier type.
    (c) Release and use of hospital accreditation surveys. (1) A 
hospital deemed to meet program requirements must authorize its 
accreditation organization to release to CMS and the State survey agency 
a copy of its most current accreditation survey together with any other 
information related to the survey that CMS may require (including 
corrective action plans).
    (2) CMS may use a validation survey, an accreditation survey or 
other information related to the survey to determine that a hospital 
does not meet the Medicare conditions of participation.
    (3) CMS may disclose the survey and information related to the 
survey to the extent that the accreditation survey and related survey 
information are

[[Page 185]]

related to an enforcement action taken by CMS.

[58 FR 61840, Nov. 23, 1993]



Sec.  488.6  Other national accreditation programs for hospitals and other providers and suppliers.

    (a) In accordance with the requirements of this subpart, a national 
accreditation program for hospitals; psychiatric hospitals; transplant 
centers, except for kidney transplant centers; SNFs; HHAs; ASCs; RHCs; 
CORFs; hospices; religious nonmedical health care institutions; 
screening mammography services; critical access hospitals; or clinic, 
rehabilitation agency, or public health agency providers of outpatient 
physical therapy, occupational therapy or speech pathology services may 
provide reasonable assurance to CMS that it requires the providers or 
suppliers it accredits to meet requirements that are at least as 
stringent as the Medicare conditions when taken as a whole. In such a 
case, CMS may deem the providers or suppliers the program accredits to 
be in compliance with the appropriate Medicare conditions. These 
providers and suppliers are subject to validation surveys under Sec.  
488.7 of this subpart. CMS will publish notices in the Federal Register 
in accordance with Sec.  488.8(b) identifying the programs and deeming 
authority of any national accreditation program and the providers or 
suppliers it accredits. The notice will describe how the accreditation 
organization's accreditation program provides reasonable assurance that 
entities accredited by the organization meet Medicare requirements. (See 
Sec.  488.5 for requirements concerning hospitals accredited by JCAHO or 
AOA.)
    (b) Eligibility for Medicaid participation can be established 
through Medicare deemed status for providers and suppliers that are not 
required under Medicaid regulations to comply with any requirements 
other than Medicare participation requirements for that provider or 
supplier type.
    (c)(1) A provider or supplier deemed to meet program requirements 
under paragraph (a) of this section must authorize its accreditation 
organization to release to CMS and the State survey agency a copy of its 
most current accreditation survey, together with any information related 
to the survey that CMS may require (including corrective action plans).
    (2) CMS may determine that a provider or supplier does not meet the 
Medicare conditions on the basis of its own investigation of the 
accreditation survey or any other information related to the survey.
    (3) Upon written request, CMS may disclose the survey and 
information related to the survey--
    (i) Of any HHA; or
    (ii) Of any other provider or supplier specified at paragraph (a) of 
this section if the accreditation survey and related survey information 
relate to an enforcement action taken by CMS.

[58 FR 61840, Nov. 23, 1993, as amended at 62 FR 46037, Aug. 29, 1997; 
64 FR 67052, Nov. 30, 1999; 72 FR 15278, Mar. 30, 2007]



Sec.  488.7  Validation survey.

    (a) Basis for survey. CMS may require a survey of an accredited 
provider or supplier to validate its organization's accreditation 
process. These surveys will be conducted on a representative sample 
basis, or in response to substantial allegations of noncompliance.
    (1) When conducted on a representative sample basis, the survey is 
comprehensive and addresses all Medicare conditions or is focused on a 
specific condition or conditions.
    (2) When conducted in response to a substantial allegation, the 
State survey agency surveys for any condition that CMS determines is 
related to the allegations.
    (3) If the State survey agency substantiates a deficiency and CMS 
determines that the provider or supplier is out of compliance with any 
Medicare condition, the State survey agency conducts a full Medicare 
survey.
    (b) Effect of selection for survey. A provider or supplier selected 
for a validation survey must--
    (1) Authorize the validation survey to take place; and
    (2) Authorize the State survey agency to monitor the correction of 
any deficiencies found through the validation survey.
    (c) Refusal to cooperate with survey. If a provider or supplier 
selected for a validation survey fails to comply with

[[Page 186]]

the requirements specified in paragraph (b) of this section, it will no 
longer be deemed to meet the Medicare conditions but will be subject to 
full review by the State survey agency in accordance with Sec.  488.11 
and may be subject to termination of its provider agreement under Sec.  
489.53 of this chapter.
    (d) Consequences of finding of noncompliance. If a validation survey 
results in a finding that the provider or supplier is out of compliance 
with one or more Medicare conditions, the provider or supplier will no 
longer be deemed to meet any Medicare conditions. Specifically, the 
provider or supplier will be subject to the participation and 
enforcement requirements applied to all providers or suppliers that are 
found out of compliance following a State agency survey under Sec.  
488.24 and to full review by a State agency survey in accordance with 
Sec.  488.11 and may be subject to termination of the provider agreement 
under Sec.  439.53 of this chapter and any other applicable intermediate 
sanctions and remedies.
    (e) Reinstating effect of accreditation. An accredited provider or 
supplier will again be deemed to meet the Medicare conditions in 
accordance with this section if--
    (1) It withdraws any prior refusal to authorize its accreditation 
organization to release a copy of the provider's or supplier's current 
accreditation survey;
    (2) It withdraws any prior refusal to allow a validation survey; and
    (3) CMS finds that the provider or supplier meets all the applicable 
Medicare conditions. If CMS finds that an accredited facility meets the 
Life Safety Code Standard by virtue of a plan of correction, the State 
survey agency will continue to monitor the facility until it is in 
compliance with the Life Safety Code Standard.

[58 FR 61840, Nov. 23, 1993]



Sec.  488.8  Federal review of accreditation organizations.

    (a) Review and approval of national accreditation organization. 
CMS's review and evaluation of a national accreditation organization 
will be conducted in accordance with, but will not necessarily be 
limited to, the following general criteria--
    (1) The equivalency of an accreditation organization's accreditation 
requirements of an entity to the comparable CMS requirements for the 
entity;
    (2) The organization's survey process to determine--
    (i) The composition of the survey team, surveyor qualifications, and 
the ability of the organization to provide continuing surveyor training;
    (ii) The comparability of survey procedures to those of State survey 
agencies, including survey frequency, and the ability to investigate and 
respond appropriately to complaints against accredited facilities;
    (iii) The organization's procedures for monitoring providers or 
suppliers found by the organization to be out of compliance with program 
requirements. These monitoring procedures are to be used only when the 
organization identifies noncompliance. If noncompliance is identified 
through validation surveys, the State survey agency monitors corrections 
as specified at Sec.  488.7(b)(3);
    (iv) The ability of the organization to report deficiencies to the 
surveyed facilities and respond to the facility's plan of correction in 
a timely manner;
    (v) The ability of the organization to provide CMS with electronic 
data in ASCII comparable code and reports necessary for effective 
validation and assessment of the organization survey process;
    (vi) The adequacy of staff and other resources;
    (vii) The organization's ability to provide adequate funding for 
performing required surveys; and
    (viii) The organization's policies with respect to whether surveys 
are announced or unannounced; and
    (3) The accreditation organization's agreement to provide CMS with a 
copy of the most current accreditation survey together with any other 
information related to the survey as CMS may require (including 
corrective action plans).
    (b) Notice and comment. (1) CMS will publish a proposed notice in 
the Federal Register whenever it contemplates approving an accreditation

[[Page 187]]

organization's application for deeming authority. The proposed notice 
will specify the basis for granting approval of deeming authority and 
the types of providers and suppliers accredited by the organization for 
which deeming authority would be approved. The proposed notice will also 
describe how the accreditation organization's accreditation program 
provides reasonable assurance that entities accredited by the 
organization meet Medicare requirements. The proposed notice will also 
provide opportunity for public comment.
    (2) CMS will publish a final notice in the Federal Register whenever 
it grants deeming authority to a national accreditation organization. 
Publication of the final notice will follow publication of the proposed 
notice by at least six months. The final notice will specify the 
effective date of the approval of deeming authority and the term of 
approval (which will not exceed six years).
    (c) Effects of approval of an accreditation organization. CMS will 
deem providers and suppliers accredited by an approved accreditation 
organization to meet the Medicare conditions for which the approval of 
deeming authority has specifically been granted. The deeming authority 
will take effect 90 days following the publication of the final notice.
    (d) Continuing Federal oversight of equivalency of an accreditation 
organization and removal of deeming authority. This paragraph 
establishes specific criteria and procedures for continuing oversight 
and for removing the approval of deeming authority of a national 
accreditation organization.
    (1) Comparability review. CMS will compare the equivalency of an 
accreditation organization's accreditation requirements to the 
comparable CMS requirements if--
    (i) CMS imposes new requirements or changes its survey process;
    (ii) An accreditation organization proposes to adopt new 
requirements or change its survey process. An accreditation organization 
must provide written notification to CMS at least 30 days in advance of 
the effective date of any proposed changes in its accreditation 
requirements or survey process; and
    (iii) An accreditation organization's approval has been in effect 
for the maximum term specified by CMS in the final notice.
    (2) Validation review. Following the end of a validation review 
period, CMS will identify any accreditation programs for which--
    (i) Validation survey results indicate a rate of disparity between 
certifications of the accreditation organization and certification of 
the State agency of 20 percent or more; or
    (ii) Validation survey results, irrespective of the rate of 
disparity, indicate widespread or systematic problems in an 
organization's accreditation process that provide evidence that there is 
no longer reasonable assurance that accredited entities meet Medicare 
requirements.
    (3) Reapplication procedures. (i) Every six years, or sooner as 
determined by CMS, an approved accreditation organization must reapply 
for continued approval of deeming authority. CMS will notify the 
organization of the materials the organization must submit as part of 
the reapplication procedure.
    (ii) An accreditation organization that is not meeting the 
requirements of this subpart, as determined through a comparability 
review, must furnish CMS, upon request and at any time, with the 
reapplication materials CMS requests. CMS will establish a deadline by 
which the materials are to be submitted.
    (e) Notice. If a comparability or validation review reveals 
documentation that an accreditation organization is not meeting the 
requirements of this subpart, CMS will provide written notice to the 
organization indicating that its deeming authority approval may be in 
jeopardy and that a deeming authority review is being initiated. The 
notice provides the following information--
    (1) A statement of the requirements, instances, rates or patterns of 
discrepancies that were found as well as other related documentation;
    (2) An explanation of CMS's deeming authority review on which the 
final determination is based;

[[Page 188]]

    (3) A description of the process available if the accreditation 
organization wishes an opportunity to explain or justify the findings 
made during the comparability or validation review;
    (4) A description of the possible actions that may be imposed by CMS 
based on the findings from the validation review; and
    (5) The reapplication materials the organization must submit and the 
deadline for their submission.
    (f) Deeming authority review. (1) CMS will conduct a review of an 
accreditation organization's accreditation program if the comparability 
or validation review produces findings as described at paragraph (d)(1) 
or (2), respectively, of this section. CMS will review as appropriate 
either or both--
    (i) The requirements of the accreditation organization; or
    (ii) The criteria described in paragraph (a)(1) of this section to 
reevaluate whether the accreditation organization continues to meet all 
these criteria.
    (2) If CMS determines, following the deeming authority review, that 
the accreditation organization has failed to adopt requirements 
comparable to CMS's or submit new requirements timely, the accreditation 
organization may be given a conditional approval of its deeming 
authority for a probationary period of up to 180 days to adopt 
comparable requirements.
    (3) If CMS determines, following the deeming authority review, that 
the rate of disparity identified during the validation review meets 
either of the criteria set forth in paragraph (d)(2) of this section 
CMS--
    (i) May give the accreditation organization conditional approval of 
its deeming authority during a probationary period of up to one year 
(whether or not there are also noncomparable requirements) that will be 
effective 30 days following the date of this determination;
    (ii) Will require the accreditation organization to release to CMS 
upon its request any facility-specific data that is required by CMS for 
continued monitoring:
    (iii) Will require the accreditation organization to provide CMS 
with a survey schedule for the purpose of intermittent onsite monitoring 
by CMS staff, State surveyors, or both; and
    (iv) Will publish in the Medicare Annual Report to Congress the name 
of any accreditation organization given a probationary period by CMS.
    (4) Within 60 days after the end of any probationary period, CMS 
will make a final determination as to whether or not an accreditation 
program continues to meet the criteria described at paragraph (a)(1) of 
this section and will issue an appropriate notice (including reasons for 
the determination) to the accreditation organization and affected 
providers or suppliers. This determination will be based on any of the 
following--
    (i) The evaluation of the most current validation survey and review 
findings. The evaluation must indicate an acceptable rate of disparity 
of less than 20 percent between the certifications of the accreditation 
organization and the certifications of the State agency as described at 
paragraph (d)(2)(i) of this section in order for the accreditation 
organization to retain its approval;
    (ii) The evaluation of facility-specific data, as necessary, as well 
as other related information;
    (iii) The evaluation of an accreditation organization's surveyors in 
terms of qualifications, ongoing training composition of survey team, 
etc.;
    (iv) The evaluation of survey procedures; or
    (v) The accreditation requirements.
    (5) If the accreditation program has not made improvements 
acceptable to CMS during the probationary period, CMS may remove 
recognition of deemed authority effective 30 days from the date that it 
provides written notice to the organization that its deeming authority 
will be removed.
    (6) The existence of any validation review, deeming authority 
review, probationary period, or any other action by CMS, does not affect 
or limit the conducting of any validation survey.
    (7) CMS will publish a notice in the Federal Register containing a 
justification of the basis for removing the deeming authority from an 
accreditation organization. The notice will provide the reasons the 
accreditation organization's accreditation program no longer meets 
Medicare requirements.

[[Page 189]]

    (8) After CMS removes approval of an accreditation organization's 
deeming authority, an affected provider's or supplier's deemed status 
continues in effect 60 days after the removal of approval. CMS may 
extend the period for an additional 60 days for a provider or supplier 
if it determines that the provider or supplier submitted an application 
within the initial 60 day timeframe to another approved accreditation 
organization or to CMS so that a certification of compliance with 
Medicare conditions can be determined.
    (9) Failure to comply with the timeframe requirements specified in 
paragraph (f)(8) of this section will jeopardize a provider's or 
supplier's participation in the Medicare program and where applicable in 
the Medicaid program.
    (g) If at any time CMS determines that the continued approval of 
deeming authority of any accreditation organization poses an immediate 
jeopardy to the patients of the entities accredited by that 
organization, or such continued approval otherwise constitutes a 
significant hazard to the public health, CMS may immediately withdraw 
the approval of deeming authority of that accreditation organization.
    (h) Any accreditation organization dissatisfied with a determination 
to remove its deeming authority may request a reconsideration of that 
determination in accordance with subpart D of this part.

[58 FR 61841, Nov. 23, 1993]



Sec.  488.9  Onsite observation of accreditation organization operations.

    As part of the application review process, the validation review 
process, or the continuing oversight of an accreditation organization's 
performance, CMS may conduct an onsite inspection of the accreditation 
organization's operations and offices to verify the organization's 
representations and to assess the organization's compliance with its own 
policies and procedures. The onsite inspection may include, but is not 
limited to, the review of documents, auditing meetings concerning the 
accreditation process, the evaluation of survey results or the 
accreditation decision-making process, and interviews with the 
organization's staff.

[58 FR 61842, Nov. 23, 1993]



Sec.  488.10  State survey agency review: Statutory provisions.

    (a) Section 1864(a) of the Act requires the Secretary to enter into 
an agreement with any State that is able and willing to do so, under 
which appropriate State or local survey agencies will determine whether:
    (1) Providers or prospective providers meet the Medicare conditions 
of participation or requirements (for SNFs and NFs);
    (2) Suppliers meet the conditions for coverage; and
    (3) Rural health clinics meet the conditions of certification.
    (b) Section 1865(a) of the Act provides that if an institution is 
accredited as a hospital by the JCAHO, it will be deemed to meet the 
conditions of participation:
    (1) Except those specified in Sec.  488.5;
    (2) Provided that such hospital, if it is included within a 
validation survey, authorizes the JCAHO to release to CMS (on a 
confidential basis) upon request a copy of the most current JCAHO 
accreditation survey.
    (c) Section 1864(c) of the Act authorizes the Secretary to enter 
into agreements with State survey agencies for the purpose of conducting 
validation surveys in hospitals accredited by the JCAHO. Section 1865(b) 
provides that an accredited hospital which is found after a validation 
survey to have significant deficiencies related to the health and safety 
of patients will no longer be deemed to meet the conditions of 
participation.
    (d) Section 1865(a) of the Act also provides that if CMS finds that 
accreditation of a hospital; psychiatric hospital; SNF; HHA; hospice; 
ASC; RHC; CORF; laboratory; screening mammography service; critical 
access hospital; or clinic, rehabilitation agency, or public health 
agency provider of outpatient physical therapy, occupational therapy, or 
speech pathology services by any national accreditation organization 
provides reasonable assurance that any or all Medicare conditions are

[[Page 190]]

met, CMS may treat the provider or supplier as meeting the conditions.

[53 FR 22859, June 17, 1988, as amended at 56 FR 48879, Sept. 26, 1991; 
58 FR 61842, Nov. 23, 1993; 62 FR 46037, Aug. 29, 1997]



Sec.  488.11  State survey agency functions.

    State and local agencies that have agreements under section 1864(a) 
of the Act perform the following functions:
    (a) Survey and make recommendations regarding the issues listed in 
Sec.  488.10.
    (b) Conduct validation surveys of accredited facilities as provided 
in Sec.  488.7.
    (c) Perform other surveys and carry out other appropriate activities 
and certify their findings to CMS.
    (d) Make recommendations regarding the effective dates of provider 
agreements and supplier approvals in accordance with Sec.  489.13 of 
this chapter.

[62 FR 43936, Aug. 18, 1997]



Sec.  488.12  Effect of survey agency certification.

    Certifications by the State survey agency represent recommendations 
to CMS.
    (a) On the basis of these recommendations, CMS will determine 
whether:
    (1) A provider or supplier is eligible to participate in or be 
covered under the Medicare program; or
    (2) An accredited hospital is deemed to meet the Medicare conditions 
of participation or is subject to full review by the State survey 
agency.
    (b) Notice of CMS's determination will be sent to the provider or 
supplier.



Sec.  488.14  Effect of QIO review.

    When a QIO is conducting review activities under section 1154 of the 
Act and part 466 of this chapter, its activities are in lieu of the 
utilization review and evaluation activities required of health care 
institutions under sections 1861(e)(6), and 1861(k) of the Act.

[59 FR 56237, Nov. 10, 1994]



Sec.  488.18  Documentation of findings.

    (a) The findings of the State agency with respect to each of the 
conditions of participation, requirements (for SNFs and NFs), or 
conditions for coverage must be adequately documented. When the State 
agency certifies to the Secretary that a provider or supplier is not in 
compliance with the conditions or requirements (for SNFs and NFs), and 
therefore not eligible to participate in the program, such documentation 
includes, in addition to the description of the specific deficiencies 
which resulted in the agency's recommendation, any provider or supplier 
response.
    (b) If a provider or supplier is certified by the State agency as in 
compliance with the conditions or participation requirements (for SNFs 
and NFs) or as meeting the requirements for special certification (see 
Sec.  488.54), with deficiencies not adversely affecting the health and 
safety of patients, the following information will be incorporated into 
the finding:
    (1) A statement of the deficiencies that were found.
    (2) A description of further action that is required to remove the 
deficiencies.
    (3) A time-phased plan of correction developed by the provider and 
supplier and concurred with by the State agency.
    (4) A scheduled time for a resurvey of the institution or agency to 
be conducted by the State agency within 90 days following the completion 
of the survey.
    (c) If, on the basis of the State certification, the Secretary 
determines that the provider or supplier is eligible to participate, the 
information described in paragraph (b) of this section will be 
incorporated into a notice of eligibility to the provider or supplier.
    (d) If the State agency receives information to the effect that a 
hospital or a critical access hospital (as defined in section 
1861(mm)(1) of the Act) has violated Sec.  489.24 of this chapter, the 
State agency is to report the information to CMS promptly.

[39 FR 2251, Jan. 17, 1974. Redesignated at 39 FR 11419, Mar. 28, 1974, 
and further redesignated at 42 FR 52826, Sept. 30, 1977. Redesignated at 
53 FR 23100, June 17, 1988; 59 FR 32120, June 22, 1994; 59 FR 56237, 
Nov. 10, 1994; 62 FR 46037, Aug. 29, 1997]

    Effective Date Note: At 59 FR 32120, June 22, 1994, in Sec.  488.18, 
paragraph (d) was added. The amendment contains information collection 
and recordkeeping requirements and

[[Page 191]]

will not become effective until approval has been given by the Office of 
Management and Budget.



Sec.  488.20  Periodic review of compliance and approval.

    (a) Determinations by CMS to the effect that a provider or supplier 
is in compliance with the conditions of participation, or requirements 
(for SNFs and NFs), or the conditions for coverage are made as often as 
CMS deems necessary and may be more or less than a 12-month period, 
except for SNFs, NFs and HHAs. (See Sec.  488.308 for special rules for 
SNFs and NFs.)
    (b) The responsibilities of State survey agencies in the review and 
certification of compliance are as follows:
    (1) Resurvey providers or suppliers as frequently as necessary to 
ascertain compliance and confirm the correction of deficiencies;
    (2) Review reports prepared by a Professional Standards Review 
Organization (authorized under Part B Title XI of the Act) or a State 
inspection of care team (authorized under Title XIX of the Act) 
regarding the quality of a facility's care;
    (3) Evaluate reports that may pertain to the health and safety of 
patients; and
    (4) Take appropriate actions that may be necessary to achieve 
compliance or certify noncompliance to CMS.
    (c) A State survey agency certification to CMS that a provider or 
supplier is no longer in compliance with the conditions of participation 
or requirements (for SNFs and NFs) or conditions for coverage will 
supersede the State survey agency's previous certification.

(Secs. 1102, 1814, 1861, 1863 through 1866, 1871, and 1881; 42 U.S.C. 
1302, 1395f, 1395x, 1395z through 1395cc, 1395hh, and 1395rr)

[45 FR 74833, Nov. 12, 1981. Redesignated and amended at 53 FR 23100, 
June 17, 1988, and further amended at 54 FR 5373, Feb. 2, 1989; 56 FR 
48879, Sept. 26, 1991; 59 FR 56237, Nov. 10, 1994]



Sec.  488.24  Certification of noncompliance.

    (a) Special rules for certification of noncompliance for SNFs and 
NFs are set forth in Sec.  488.330.
    (b) The State agency will certify that a provider or supplier is not 
or is no longer in compliance with the conditions of participation or 
conditions for coverage where the deficiencies are of such character as 
to substantially limit the provider's or supplier's capacity to furnish 
adequate care or which adversely affect the health and safety of 
patients; or
    (c) If CMS determines that an institution or agency does not qualify 
for participation or coverage because it is not in compliance with the 
conditions of participation or conditions for coverage, or if a 
provider's agreement is terminated for that reason, the institution or 
agency has the right to request that the determination be reviewed. 
(Appeals procedures are set forth in Part 498 of this chapter.)

[59 FR 56237, Nov. 10, 1994]



Sec.  488.26  Determining compliance.

    (a) Additional rules for certification of compliance for SNFs and 
NFs are set forth in Sec.  488.330.
    (b) The decision as to whether there is compliance with a particular 
requirement, condition of participation, or condition for coverage 
depends upon the manner and degree to which the provider or supplier 
satisfies the various standards within each condition. Evaluation of a 
provider's or supplier's performance against these standards enables the 
State survey agency to document the nature and extent of deficiencies, 
if any, with respect to a particular function, and to assess the need 
for improvement in relation to the prescribed conditions.
    (c) The State survey agency must adhere to the following principles 
in determining compliance with participation requirements:
    (1) The survey process is the means to assess compliance with 
Federal health, safety and quality standards;
    (2) The survey process uses resident outcomes as the primary means 
to establish the compliance status of facilities. Specifically surveyors 
will directly observe the actual provision of care and services to 
residents, and the effects of that care, to assess whether the care 
provided meets the needs of individual residents;
    (3) Surveyors are professionals who use their judgment, in concert 
with

[[Page 192]]

Federal forms and procedures, to determine compliance;
    (4) Federal procedures are used by all surveyors to ensure uniform 
and consistent application and interpretation of Federal requirements;
    (5) Federal forms are used by all surveyors to ensure proper 
recording of findings and to document the basis for the findings.
    (d) The State survey agency must use the survey methods, procedures, 
and forms that are prescribed by CMS.
    (e) The State survey agency must ensure that a facility's actual 
provision of care and services to residents and the effects of that care 
on residents are assessed in a systematic manner.

[59 FR 56237, Nov. 10, 1994]



Sec.  488.28  Providers or suppliers, other than SNFs and NFs, with deficiencies.

    (a) If a provider or supplier is found to be deficient with respect 
to one or more of the standards in the conditions of participation or 
conditions for coverage, it may participate in or be covered under the 
Health Insurance for the Aged and Disabled Program only if the facility 
has submitted an acceptable plan of correction for achieving compliance 
within a reasonable period of time acceptable to the Secretary.
    (b) The existing deficiencies noted either individually or in 
combination neither jeopardize the health and safety of patients nor are 
of such character as to seriously limit the provider's capacity to 
render adequate care.
    (c)(1) If it is determined during a survey that a provider or 
supplier is not in compliance with one or more of the standards, it is 
granted a reasonable time to achieve compliance.
    (2) The amount of time depends upon the--
    (i) Nature of the deficiency; and
    (ii) State survey agency's judgment as to the capabilities of the 
facility to provide adequate and safe care.
    (d) Ordinarily a provider or supplier is expected to take the steps 
needed to achieve compliance within 60 days of being notified of the 
deficiencies but the State survey agency may recommend that additional 
time be granted by the Secretary in individual situations, if in its 
judgment, it is not reasonable to expect compliance within 60 days, for 
example, a facility must obtain the approval of its governing body, or 
engage in competitive bidding.

[59 FR 56237, Nov. 10, 1994]



Sec.  488.30  Revisit user fee for revisit surveys.

    (a) Definitions. As used in this section, the following definitions 
apply:
    Certification (both initial and recertification) means those 
activities as defined in Sec.  488.1.
    Complaint surveys means those surveys conducted on the basis of a 
substantial allegation of noncompliance, as defined in Sec.  488.1.
    Provider of services, provider, or supplier has the meaning defined 
in Sec.  488.1, and ambulatory surgical centers, transplant centers, and 
religious nonmedical health care institutions subject to Sec.  416.2, 
Sec.  482.70, and Sec.  403.702 [C8] of this chapter, respectively, will 
be subject to user fees unless otherwise exempted.
    Revisit survey means a survey performed with respect to a provider 
or supplier cited for deficiencies during an initial certification, 
recertification, or substantiated complaint survey and that is designed 
to evaluate the extent to which previously-cited deficiencies have been 
corrected and the provider or supplier is in substantial compliance with 
applicable conditions of participation, requirements, or conditions for 
coverage. Revisit surveys include both offsite and onsite review.
    Substantiated complaint survey means a complaint survey that results 
in the proof or finding of noncompliance at the time of the survey, a 
finding that noncompliance was proven to exist, but was corrected prior 
to the survey, and includes any deficiency that is cited during a 
complaint survey, whether or not the cited deficiency was the original 
subject of the complaint.
    (b) Criteria for determining the fee. (1) The provider or supplier 
will be assessed a revisit user fee based upon one or more of the 
following:
    (i) The average cost per provider or supplier type.
    (ii) The type of revisit survey conducted (onsite or offsite).
    (iii) The size of the provider or supplier.

[[Page 193]]

    (iv) The number of follow-up revisits resulting from uncorrected 
deficiencies.
    (v) The seriousness and number of deficiencies.
    (2) CMS may adjust the fees to account for any regional differences 
in cost.
    (c) Fee schedule. CMS must publish in the Federal Register the 
proposed and final notices of a uniform fee schedule before it assesses 
revised revisit user fees. The notices must set forth which criteria 
will be used and how, as well as the amounts of the assessed fees based 
on the criteria as identified in paragraph (b) of this subpart.
    (d) Collection of fees. (1) Fees for revisit surveys under this 
section may be deducted from amounts otherwise payable to the provider 
or supplier. As they are collected, fees will be deposited as an offset 
collection to be used exclusively for survey and certification 
activities conducted by State survey agencies pursuant to section 1864 
of the Act or by CMS, and will be available for CMS until expended. CMS 
may devise other collection methods as it deems appropriate. In 
determining these methods, CMS will consider efficiency, effectiveness, 
and convenience for the providers, suppliers, and CMS. CMS may consider 
any method allowed by law, including: Credit card; electronic fund 
transfer; check; money order; and offset collections from claims 
submitted.
    (2) Fees for revisit surveys under this section are not allowable 
items on a cost report, as identified in part 413, subpart B of this 
chapter, under title XVIII of the Act.
    (3) Fees for revisit surveys will be due for any revisit surveys 
conducted during the time period for which authority to levy a revisit 
user fee exists.
    (e) Reconsideration process for revisit user fees. (1) CMS will 
review a request for reconsideration of an assessed revisit user fee--
    (i) If a provider or supplier believes an error of fact has been 
made in the application of the revisit user fee, such as clerical 
errors, billing for a fee already paid, or assessment of a fee when 
there was no revisit conducted, and
    (ii) If the request for reconsideration is received by CMS within 14 
calendar days from the date identified on the revisit user fee 
assessment notice.
    (2) CMS will issue a credit toward any future revisit surveys 
conducted, if the provider or supplier has remitted an assessed revisit 
user fee and for which a reconsideration request is found in favor of 
the provider or supplier. If in the event that CMS judges that a 
significant amount of time has elapsed before such a credit is used, CMS 
will refund the assessed revisit user fee amount paid to the provider or 
supplier.
    (3) CMS will not reconsider the assessment of revisit user fees that 
request reconsideration of the survey findings or deficiency citations 
that may have given rise to the revisit, the revisit findings, the need 
for the revisit itself, or other similarly identified basis for the 
assessment of the revisit user fee.
    (f) Enforcement. If the full revisit user fee payment is not 
received within 30 calendar days from the date identified on the revisit 
user fee assessment notice, CMS may terminate the facility's provider 
agreement (pursuant to Sec.  489.53(a)(16) of this chapter) and 
enrollment in the Medicare program or the supplier's enrollment and 
participation in the Medicare program (pursuant to Sec.  424.535(a)(1) 
of this chapter).

[72 FR 53648, Sept. 19, 2007]



                     Subpart B_Special Requirements



Sec.  488.52  [Reserved]



Sec.  488.54  Temporary waivers applicable to hospitals.

    (a) General provisions. If a hospital is found to be out of 
compliance with one or more conditions of participation for hospitals, 
as specified in part 482 of this chapter, a temporary waiver may be 
granted by CMS. CMS may extend a temporary waiver only if such a waiver 
would not jeopardize or adversely affect the health and safety of 
patients. The waiver may be issued for any one year period or less under 
certain circumstances. The waiver may be withdrawn earlier if CMS 
determines this action is necessary to protect the

[[Page 194]]

health and safety of patients. A waiver may be granted only if:
    (1) The hospital is located in a rural area. This includes all areas 
not delineated as ``urban'' by the Bureau of the Census, based on the 
most recent census;
    (2) The hospital has 50 or fewer inpatient hospital beds;
    (3) The character and seriousness of the deficiencies do not 
adversely affect the health and safety of patients; and
    (4) The hospital has made and continues to make a good faith effort 
to comply with personnel requirements consistent with any waiver.
    (b) Minimum compliance requirements. Each case will have to be 
decided on its individual merits, and while the degree and extent of 
compliance will vary, the institution must, as a minimum, meet all of 
the statutory conditions in section 1861(e)(1)-(8), in addition to 
meeting such other requirements as the Secretary finds necessary under 
section 1861(e)(9). (For further information relating to the exception 
in section 1861(e)(5) of the Act, see paragraph (c) of this section.)
    (c) Temporary waiver of 24-hour nursing requirement of 24-hour 
registered nurse requirement. CMS may waive the requirement contained in 
section 1861(e)(5) that a hospital must provide 24-hour nursing service 
furnished or supervised by a registered nurse. Such a waiver may be 
granted when the following criteria are met:
    (1) The hospital's failure to comply fully with the 24-hour nursing 
requirement is attributable to a temporary shortage of qualified nursing 
personnel in the area in which the hospital is located.
    (2) A registered nurse is present on the premises to furnish or 
supervise the nursing services during at least the daytime shift, 7 days 
a week.
    (3) The hospital has in charge, on all tours of duty not covered by 
a registered nurse, a licensed practical (vocational) nurse.
    (4) The hospital complies with all requirements specified in 
paragraph (a) of this section.
    (d) Temporary waiver for technical personnel. CMS may waive 
technical personnel requirements, issued under section 1861(e)(9) of the 
Act, contained in the Conditions of Participation; Hospitals (part 482 
of this chapter). Such a waiver must take into account the availability 
of technical personnel and the educational opportunities for technical 
personnel in the area in which the hospital is located. CMS may also 
limit the scope of services furnished by a hospital in conjunction with 
the waiver in order not to adversely affect the health and safety of the 
patients. In addition, the hospital must also comply with all 
requirements specified in paragraph (a) of this section.

[39 FR 2251, Jan. 17, 1974. Redesignated at 39 FR 11419, Mar. 28, 1974, 
and amended at 41 FR 27962, July 8, 1976. Further redesignated at 42 FR 
52826, Sept. 30, 1977, and amended at 47 FR 31531, July 20, 1982; 51 FR 
22041, June 17, 1986. Redesignated at 53 FR 23100, June 17, 1988]



Sec.  488.56  Temporary waivers applicable to skilled nursing facilities.

    (a) Waiver of 7-day registered nurse requirement. To the extent that 
Sec.  483.30 of this chapter requires any skilled nursing facility to 
engage the services of a registered nurse more than 40 hours a week, the 
Secretary may waive such requirement for such periods as he deems 
appropriate if, based upon documented findings of the State agency, he 
determines that:
    (1) Such facility is located in a rural area and the supply of 
skilled nursing facility services in such area is not sufficient to meet 
the needs of individual patients therein,
    (2) Such facility has at least one fulltime registered nurse who is 
regularly on duty at such facility 40 hours a week, and
    (3) Such facility (i) has only patients whose attending physicians 
have indicated (through physicians' orders or admission notes) that each 
such patient does not require the services of a registered nurse for a 
48-hour period, or (ii) has made arrangements for a registered nurse or 
a physician to spend such time at the facility as is determined 
necessary by the patient's attending physician to provide necessary 
services on days when the regular fulltime registered nurse is not on 
duty.
    (4) Such facility has made and continues to make a good faith effort 
to

[[Page 195]]

comply with the more than 40-hour registered nurse requirement, but such 
compliance is impeded by the unavailability of registered nurses in the 
area.
    (b) Waiver of medical director requirement. To the extent that Sec.  
488.75(i) of this chapter requires any skilled nursing facility to 
engage the services of a medical director either part-time or full-time, 
the Secretary may waive such requirement for such periods as he deems 
appropriate if, based upon documented findings of the State agency, he 
determines that:
    (1) Such facility is located in an area where the supply of 
physicians is not sufficient to permit compliance with this requirement 
without seriously reducing the availability of physician services within 
the area, and
    (2) Such facility has made and continues to make a good faith effort 
to comply with Sec.  488.75(i) of this chapter, but such compliance is 
impeded by the unavailability of physicians in the area.

[39 FR 35777, Oct. 3, 1974. Redesignated and amended at 42 FR 52826, 
Sept. 30, 1977. Further redesignated and amended at 53 FR 23100, June 
17, 1988, and further amended at 56 FR 48879, Sept. 26, 1991; 57 FR 
43925, Sept. 23, 1992]



Sec.  488.60  Special procedures for approving end stage renal disease facilities.

    (a) Consideration for approval. An ESRD facility that wishes to be 
approved or that wishes an expansion of dialysis services to be approved 
for coverage, in accordance with part 494 of this chapter, must secure a 
determination by the Secretary. To secure a determination, the facility 
must submit the following documents and data for consideration by the 
Secretary:
    (1) Certification by the State agency referred to in Sec.  488.12 of 
this part.
    (2) Data furnished by ESRD network organizations and recommendations 
of the Public Health Service concerning the facility's contribution to 
the ESRD services of the network.
    (3) Data concerning the facility's compliance with professional 
norms and standards.
    (4) Data pertaining to the facility's qualifications for approval or 
for any expansion of services.
    (b) Determining compliance with minimal utilization rates: Time 
limitations--(1) Unconditional status. A facility which meets minimal 
utilization requirements will be assigned this status as long as it 
continues to meet these requirements.
    (2) Conditional status. A conditional status may be granted to a 
facility for not more than four consecutive calendar years and will not 
be renewable (see Sec.  405.2122(b) of this chapter). Its status may be 
examined each calendar year to ascertain its compliance with Subpart U.
    (3) Exception status. Under unusual circumstances (see Sec.  
405.2122 (b) of this chapter) the Secretary may grant a time-limited 
exception to a facility which is not in compliance with the minimal 
utilization rate(s) for either unconditional status or conditional 
status. This exception status may be granted, and may be renewed on an 
annual basis, under circumstances where rigid application of minimal 
utilization rate requirements would adversely affect the achievement of 
ESRD program objectives.
    (c) New applicant. A facility which has not previously participated 
in the ESRD program must submit a plan detailing how it expects to meet 
the conditional minimal utilization rate status by the end of the second 
calendar year of its operation under the program and meet the 
unconditional minimal utilization rate status by the end of the fourth 
calendar year of its operation under the program.
    (d) Notification. The Secretary will notify each facility and its 
network coordinating council of its initial and its subsequent minimal 
utilization rate classification.
    (e) Failure to meet minimal utilization rate. A facility failing to 
meet standards for unconditional status or conditional status, or if 
applicable, for exception status, will be so notified at the time of 
such classification.
    (f) Interim regulations participant. A facility previously 
participating under the interim regulations will not be approved under 
the program established by subpart U until it has demonstrated that it 
meets all the applicable requirements of this subpart, including the 
appropriate minimal utilization

[[Page 196]]

rate. It may continue under the interim program only for a period not to 
exceed 1 year from the effective date of these amendments (see Sec.  
405.2100(c) of this chapter). During this period it may demonstrate its 
ability to meet the appropriate minimal utilization rate. Failure to 
qualify under this subpart will automatically terminate coverage of such 
facility's services under the ESRD program at the end of such year.

[41 FR 22510, June 3, 1976. Redesignated at 42 FR 52826, Sept. 30, 1977, 
and further amended at 45 FR 58124, Sept. 2, 1980. Redesignated and 
amended at 53 FR 23100, June 17, 1988; 73 FR 20474, Apr. 15, 2008]



Sec.  488.61  Special procedures for approval and re-approval of organ transplant centers.

    For the purposes of this subpart, the survey, certification, and 
enforcement procedures described at 42 CFR part 488, subpart A apply to 
transplant centers, including the periodic review of compliance and 
approval described at Sec.  488.20.
    (a) Initial approval procedures for transplant centers that are not 
Medicare-approved as of June 28, 2007. A transplant center, including a 
kidney transplant center, may submit a request to CMS for Medicare 
approval at any time.
    (1) The request, signed by a person authorized to represent the 
center (for example, a chief executive officer), must include:
    (i) The hospital's Medicare provider I.D. number;
    (ii) Name(s) of the designated primary transplant surgeon and 
primary transplant physician; and,
    (iii) A statement from the OPTN that the center has complied with 
all data submission requirements.
    (2) To determine compliance with the clinical experience and outcome 
requirements at Sec. Sec.  482.80(b) and 482.80(c), CMS will review the 
data contained in the most recent OPTN Data Report and 1-year patient 
and graft survival data contained in the most recent Scientific Registry 
of Transplant Recipient (SRTR) center-specific report.
    (3) If CMS determines that a transplant center has not met the data 
submission, clinical experience, or outcome requirements, CMS may deny 
the request for approval or may review the center's compliance with the 
conditions of participation at Sec. Sec.  482.72 through 482.76 and 
Sec. Sec.  482.90 through 482.104 of this chapter, using the procedures 
described at 42 CFR part 488, subpart A, to determine whether the 
center's request will be approved. CMS will notify the transplant center 
in writing whether it is approved and, if approved, of the effective 
date of its approval.
    (4) CMS will consider mitigating factors, including (but not limited 
to) the following in considering initial approval of a transplant center 
that does not meet the data submission, clinical experience, outcome 
requirements and other conditions of participation:
    (i) The extent to which outcome measures are met or exceeded;
    (ii) Availability of Medicare-approved transplant centers in the 
area; and
    (iii) Extenuating circumstances (e.g., natural disaster) that may 
have a temporary effect on meeting the conditions of participation.
    (iv) CMS will not approve any program with a condition-level 
deficiency. However, CMS may approve a program with a standard-level 
deficiency upon receipt of an acceptable plan of correction.
    (5) If CMS determines that a transplant center has met the data 
submission, clinical experience, and outcome requirements, CMS will 
review the center's compliance with the conditions of participation 
contained at Sec. Sec.  482.72 through 482.76 and Sec. Sec.  482.90 
through 482.104 of this chapter using the procedures described at 42 CFR 
part 488, subpart A. If the transplant center is found to be in 
compliance with all the conditions of participation at Sec. Sec.  482.72 
through 482.104, except for Sec.  482.82 of this chapter (Re-approval 
Requirements), CMS will notify the transplant center in writing of the 
effective date of its Medicare-approval. CMS will notify the transplant 
center in writing if it is not Medicare-approved.
    (6) A kidney transplant center may submit a request for initial 
approval after performing at least 3 transplants over a 12-month period.
    (7) Transplant centers will be approved for 3 years.

[[Page 197]]

    (b) Initial approval procedures for transplant centers, including 
kidney transplant centers, that are Medicare approved as of June 28, 
2007. (1) A transplant center that wants to continue to be Medicare 
approved must be in compliance with the conditions of participation at 
Sec. Sec.  482.72 through 482.104 as of June 28, 2007 and submit a 
request to CMS for Medicare approval under the conditions of 
participation no later than December 26, 2007, using the process 
described in paragraph (a)(1) of the section.
    (2) CMS will determine whether to approve the transplant center, 
using the procedures described in paragraphs (a)(2) through (a)(5) of 
this section. Until CMS makes a determination whether to approve the 
transplant center under the conditions of participation at Sec. Sec.  
482.72 through 482.104, the transplant center will continue to be 
Medicare approved under the end stage renal disease (ESRD) conditions 
for coverage (CfCs) in part 405, subpart U of this chapter for kidney 
transplant centers or the pertinent national coverage decisions (NCDs) 
for extra-renal organ transplant centers, as applicable, and the 
transplant center will continue to be reimbursed for services provided 
to Medicare beneficiaries.
    (3) Once CMS approves a kidney transplant center under the 
conditions of participation, the ESRD CfCs no longer apply to the center 
as of the date of its approval. Once CMS approves an extra-renal organ 
transplant center under the conditions of participation, the NCDs no 
longer apply to the center as of the date of its approval.
    (4) If a transplant center that is Medicare approved as of June 28, 
2007 submits a request for approval under the CoPs at Sec. Sec.  482.72 
through 482.104 of this chapter but CMS does not approve the transplant 
center, or if the transplant center does not submit its request to CMS 
for Medicare approval under the CoPs by December 26, 2007, CMS will 
revoke the transplant center's approval under the conditions for 
coverage for kidney transplant centers or the national coverage 
decisions for extra-renal transplant centers, as applicable, and the 
transplant center will no longer be reimbursed for services provided to 
Medicare beneficiaries. CMS will notify the transplant center in writing 
of the effective date of its loss of Medicare approval.
    (c) Re-approval procedures. Once Medicare-approved, transplant 
centers, including kidney transplant centers, must be in compliance with 
all the conditions of participation for transplant centers at Sec. Sec.  
482.72 through 482.104 of this chapter, except for Sec.  482.80 (initial 
approval requirements) throughout the 3-year approval period.
    (1) Prior to the end of the 3-year approval period, CMS will review 
the transplant center's data in making re-approval determinations.
    (i) To determine compliance with the data submission requirements at 
Sec.  482.82(a) of this chapter, CMS will request data submission data 
from the OPTN for the previous 3 calendar years.
    (ii) To determine compliance with the clinical experience and 
outcome requirements at Sec.  482.82(b) and Sec.  482.82(c) of this 
chapter, CMS will review the data contained in the most recent OPTN Data 
Report and 1-year patient and graft survival data contained in the most 
recent SRTR center-specific reports.
    (2) If CMS determines that a transplant center has not met the data 
submission, clinical experience, or outcome requirements at Sec.  
482.82, the transplant center will be reviewed for compliance with 
Sec. Sec.  482.72 through 482.76 and Sec. Sec.  482.90 through 482.104 
of this chapter, using the procedures described at 42 CFR part 488, 
subpart A.
    (3) If CMS determines that a transplant center has met the data 
submission, clinical experience, and outcome requirements at Sec.  
482.82, CMS may choose to review the transplant center for compliance 
with Sec. Sec.  482.72 through 482.76 and Sec. Sec.  482.90 through 
482.104 of this chapter, using the procedures described at 42 CFR part 
488, subpart A.
    (4) CMS will consider mitigating factors, including (but not limited 
to) the following in considering re-approval of a transplant center that 
does not meet the data submission, clinical experience, outcome 
requirements and other conditions of participation:
    (i) The extent to which outcome measures are met or exceeded;

[[Page 198]]

    (ii) Availability of Medicare-approved transplant centers in the 
area; and
    (iii) Extenuating circumstances (e.g., natural disaster) that may 
have a temporary effect on meeting the conditions of participation.
    (iv) CMS will not approve any program with a condition-level 
deficiency. However, CMS may re-approve a program with a standard-level 
deficiency upon receipt of an acceptable plan of correction.
    (5) CMS will notify the transplant center in writing if its approval 
is being revoked and of the effective date of the revocation.
    (d) Loss of Medicare Approval. Centers that have lost their Medicare 
approval may seek re-entry into the Medicare program at any time. A 
center that has lost its Medicare approval must:
    (1) Request initial approval using the procedures described in Sec.  
488.61(a);
    (2) Be in compliance with Sec. Sec.  482.72 through 482.104 of this 
chapter, except for Sec.  482.82 (Re-approval Requirements), at the time 
of the request for Medicare approval; and
    (3) Submit a report to CMS documenting any changes or corrective 
actions taken by the center as a result of the loss of its Medicare 
approval status.
    (e) Transplant Center Inactivity. A transplant center may remain 
inactive and retain its Medicare approval for a period not to exceed 12 
months during the 3-year approval cycle. A transplant center must notify 
CMS upon its voluntary inactivation as required by Sec.  482.74(d) of 
this chapter.

[72 FR 15278, Mar. 30, 2007]



Sec.  488.64  Remote facility variances for utilization review requirements.

    (a) As used in this section:
    (1) An ``available'' individual is one who:
    (i) Possesses the necessary professional qualifications;
    (ii) Is not precluded from participating by reason of financial 
interest in any such facility or direct responsibility for the care of 
the patients being reviewed or, in the case of a skilled nursing 
facility, employment by the facility; and
    (iii) Is not precluded from effective participation by the distance 
between the facility and his residence, office, or other place of work. 
An individual whose residence, office, or other place of work is more 
than approximately one hour's travel time from the facility shall be 
considered precluded from effective participation.
    (2) ``Adjacent facility'' means a health care facility located 
within a 50-mile radius of the facility which requests a variance.
    (b) The Secretary may grant a requesting facility a variance from 
the time frames set forth in Sec. Sec.  405.1137(d) of this chapter and 
482.30 as applicable, within which reviews all of cases must be 
commenced and completed, upon a showing satisfactory to the Secretary 
that the requesting facility has been unable to meet one or more of the 
requirements of Sec.  405.1137 of this chapter or Sec.  482.30 of this 
chapter, as applicable, by reason of insufficient medical and other 
professional personnel available to conduct the utilization review 
required by Sec.  405.1137 of this chapter or Sec.  482.30 of this 
chapter, as applicable.
    (c) The request for variance shall document the requesting 
facility's inability to meet the requirements for which a variance is 
requested and the facility's good faith efforts to comply with the 
requirements contained in Sec.  405.1137 of this chapter or Sec.  482.30 
of this chapter, as applicable.
    (d) The request shall include an assurance by the requesting 
facility that it will continue its good faith efforts to meet the 
requirements contained in Sec.  405.1137 of this chapter or Sec.  482.30 
of this chapter, as applicable.
    (e) A revised utilization review plan for the requesting facility 
shall be submitted concurrently with the request for a variance. The 
revised plan shall specify the methods and procedures which the 
requesting facility will use, if a variance is granted, to assure:
    (1) That effective and timely control will be maintained over the 
utilization of services; and
    (2) That reviews will be conducted so as to improve the quality of 
care provided to patients.
    (f) The request for a variance shall include:
    (1) The name, location, and type (e.g., hospital, skilled nursing 
facility) of the

[[Page 199]]

facility for which the variance is requested;
    (2) The total number of patient admissions and average daily patient 
census at the facility within the previous six months;
    (3) The total number of title XVIII and title XIX patient admissions 
and the average daily patient census of title XVIII and title XIX 
patients in the facility within the previous six months;
    (4) As relevant to the request, the names of all physicians on the 
active staff of the facility and the names of all other professional 
personnel on the staff of the facility, or both;
    (5) The name, location, and type of each adjacent facility (e.g., 
hospital, skilled nursing facility);
    (6) The distance and average travel time between the facility and 
each adjacent facility;
    (7) As relevant to the request, the location of practice of 
available physicians and the estimated number of other available 
professional personnel, or both (see paragraph (a)(1)(iii) of this 
section);
    (8) Documentation by the facility of its attempt to obtain the 
services of available physicians or other professional personnel, or 
both; and
    (9) A statement of whether a QIO exists in the area where the 
facility is located.
    (g) The Secretary shall promptly notify the facility of the action 
taken on the request. Where a variance is in effect, the validation of 
utilization review pursuant to Sec.  405.1137 of this chapter or Sec.  
482.30 shall be made with reference to the revised utilization review 
plan submitted with the request for variance.
    (h) The Secretary, in granting a variance, will specify the period 
for which the variance has been granted; such period will not exceed one 
year. A request for a renewal shall be submitted not later than 30 days 
prior to the expiration of the variance and shall contain all 
information required by paragraphs (c), (d), and (f) of this section. 
Renewal of the variance will be contingent upon the facility's 
continuing to meet the provisions of this section.

[40 FR 30818, July 23, 1975. Redesignated at 42 FR 52826, Sept. 30, 
1977; 51 FR 22041, June 17, 1986; 51 FR 27847, Aug. 4, 1986; 51 FR 
43197, Dec. 1, 1986. Redesignated and amended at 53 FR 23100, June 17, 
1988]



Sec.  488.68  State Agency responsibilities for OASIS collection and data base requirements.

    As part of State agency survey responsibilities, the State agency or 
other entity designated by CMS has overall responsibility for fulfilling 
the following requirements for operating the OASIS system:
    (a) Establish and maintain an OASIS database. The State agency or 
other entity designated by CMS must--
    (1) Use a standard system developed or approved by CMS to collect, 
store, and analyze data;
    (2) Conduct basic system management activities including hardware 
and software maintenance, system back-up, and monitoring the status of 
the database; and
    (3) Obtain CMS approval before modifying any parts of the CMS 
standard system including, but not limited to, standard CMS-approved--
    (i) OASIS data items;
    (ii) Record formats and validation edits; and
    (iii) Agency encoding and transmission methods.
    (b) Analyze and edit OASIS data. The State agency or other entity 
designated by CMS must--
    (1) Upon receipt of data from an HHA, edit the data as specified by 
CMS and ensure that the HHA resolves errors within the limits specified 
by CMS;
    (2) At least monthly, make available for retrieval by CMS all edited 
OASIS records received during that period, according to formats 
specified by CMS, and correct and retransmit previously rejected data as 
needed; and
    (3) Analyze data and generate reports as specified by CMS.
    (c) Ensure accuracy of OASIS data. The State agency must audit the 
accuracy of the OASIS data through the survey process.

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    (d) Restrict access to OASIS data. The State agency or other entity 
designated by CMS must do the following:
    (1) Ensure that access to data is restricted except for the 
transmission of data and reports to--
    (i) CMS;
    (ii) The State agency component that conducts surveys for purposes 
related to this function; and
    (iii) Other entities if authorized by CMS.
    (2) Ensure that patient identifiable OASIS data is released only to 
the extent that it is permitted under the Privacy Act of 1974.
    (e) Provide training and technical support for HHAs. The State 
agency or other entity designated by CMS must--
    (1) Instruct each HHA on the administration of the data set, 
privacy/confidentiality of the data set, and integration of the OASIS 
data set into the facility's own record keeping system;
    (2) Instruct each HHA on the use of software to encode and transmit 
OASIS data to the State;
    (3) Specify to a facility the method of transmission of data to the 
State, and instruct the facility on this method.
    (4) Monitor each HHA's ability to transmit OASIS data.
    (5) Provide ongoing technical assistance and general support to HHAs 
in implementing the OASIS reporting requirements specified in the 
conditions of participation for home health agencies; and
    (6) Carry out any other functions as designated by CMS necessary to 
maintain OASIS data on the standard State system.

[64 FR 3763, Jan. 25, 1999]



                  SUBPART C_SURVEY FORMS AND PROCEDURES

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Sec.  488.100  Long term care survey forms, Part A.
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Sec.  488.105  Long term care survey forms, Part B.
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Sec.  488.110  Procedural guidelines.

    SNF/ICF Survey Process. The purpose for implementing a new SNF/ICF 
survey process is to assess whether the quality of care, as intended by 
the law and regulations, and as needed by the resident, is actually 
being provided in nursing homes. Although the onsite review procedures 
have been changed, facilities must continue to meet all applicable 
Conditions/Standards, in order to participate in Medicare/Medicaid 
programs. That is, the methods used to

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compile information about compliance with law and regulations are 
changed; the law and regulations themselves are not changed. The new 
process differs from the traditional process, principally in terms of 
its emphasis on resident outcomes. In ascertaining whether residents 
grooming and personal hygiene needs are met, for example, surveyors will 
no longer routinely evaluate a facility's written policies and 
procedures. Instead, surveyors will observe residents in order to make 
that determination. In addition, surveyors will confirm, through 
interviews with residents and staff, that such needs are indeed met on a 
regular basis. In most reviews, then, surveyors will ascertain whether 
the facility is actually providing the required and needed care and 
services, rather than whether the facility is capable of providing the 
care and services.

 The Outcome-Oriented Survey Process--Skilled Nursing Facilities (SNFs) 
                 and Intermediate Care Facilities (ICFs)

    (a) General.
    (b) The Survey Tasks.
    (c) Task 1--Entrance Conference.
    (d) Task 2--Resident Sample--Selection Methodology.
    (e) Task 3--Tour of the Facility.
    (f) Task 4--Observation/Interview/Medical Record Review (including 
drug regimen review).
    (g) Task 5--Drug Pass Observation.
    (h) Task 6--Dining Area and Eating Assistance Observation.
    (i) Task 7--Forming the Deficiency Statement.
    (j) Task 8--Exit Conference.
    (k) Plan of Correction.
    (l) Followup Surveys.
    (m) Role of Surveyor.
    (n) Confidentiality and Respect for Resident Privacy.
    (o) Team Composition.
    (p) Type of Facility-Application of SNF or ICF Regulations.
    (q) Use of Part A and Part B of the Survey Report.

    (a) General. A complete SNF/ICF facility survey consists of three 
components:
     Life Safety Code requirements;
     Administrative and structural requirements (Part 
A of the Survey Report, Form CMS-525); and
     Direct resident care requirements (Part B of the 
Survey Report, Form CMS-519), along with the related worksheets (CMS-520 
through 524).
    Use this survey process for all surveys of SNFs and ICFs--whether 
freestanding, distinct parts, or dually certified. Do not use this 
process for surveys of Intermediate Care Facilities for Mentally 
Retarded (ICFs/MR), swing-bed hospitals or skilled nursing sections of 
hospitals that are not separately certified as SNF distinct parts. Do 
not announce SNF/ICF surveys ahead of time.
    (b) The Survey Tasks. Listed below are the survey tasks for easy 
reference:
     Task 1. Entrance Conference.
     Task 2. Resident Sample--Selection Methodology.
     Task 3. Tour of the Facility. Resident Needs. 
Physical Environment. Meeting with Resident Council Representatives. 
Tour Summation and Focus of Remaining Survey Activity.
     Task 4. Observation/Interview/Medical Record. 
Review of Each Individual in the Resident Sample (including drug regimen 
review).
     Task 5. Drug Pass Observation.
     Task 6. Dining Area and Eating Assistance 
Observation.
     Task 7. Forming the Deficiency Statement (if 
necessary).
     Task 8. Exit Conference.
    (c) Task 1--Entrance Conference. Perform these activities during the 
entrance conference in every certification and recertification survey:
     Introduce all members of the team to the facility 
staff, if possible, even though the whole team may not be present for 
the entire entrance conference. (All surveyors wear identification 
tags.)
     Explain the SNF/ICF survey process as resident 
centered in focus, and outline the basic steps.
     Ask the facility for a list showing names of 
residents by room number with each of the following care needs/
treatments identified for each resident to whom they apply:

--Decubitus care
--Restraints
--Catheters
--Injections
--Parenteral fluids
--Rehabilitation service
--Colostomy/ileostomy care
--Respiratory care

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--Tracheostomy care
--Suctioning
--Tube feeding

    Use this list for selecting the resident sample.
     Ask the facility to complete page 2 of Form CMS-
519 (Resident Census) as soon as possible, so that the information can 
further orient you to the facility's population. In a survey of a SNF 
with a distinct part ICF, you may collect two sets of census data. 
However, consolidate the information when submitting it to the regional 
office. You may modify the Resident Census Form to include the numbers 
of licensed and certified beds, if necessary.
     Ask the facility to post signs on readily viewed 
areas (at least one on each floor) announcing that State surveyors are 
in the facility performing an ``inspection,'' and are available to meet 
with residents in private. Also indicate the name and telephone number 
of the State agency. Hand-printed signs with legible, large letters are 
acceptable.
     If the facility has a Resident Council, make 
mutually agreeable arrangements to meet privately with the president and 
officers and other individuals they might invite.
     Inform the facility that interviews with 
residents and Resident Councils are conducted privately, unless they 
independently request otherwise, in order to enhance the development of 
rapport as well as to allay any resident anxiety. Tell the facility that 
information is gathered from interviews, the tour, observations, 
discussions, record review, and facility officials. Point out that the 
facility will be given an opportunity to respond to all findings.
    (d) Task 2--Resident Sample--Selection Methodology. This methodology 
is aimed at formulating a sample that reflects the actual distribution 
of care needs/treatments in the facility population.
    Primarily performed on a random basis, it also ensures 
representation in the sample of certain care needs and treatments that 
are assessed during the survey.
    (1) Sample Size. Calculate the size of the sample according to the 
following guide:

------------------------------------------------------------------------
                                          Number of residents in sample
    Number of residents in facility                    \1\
------------------------------------------------------------------------
0-60 residents.........................  25% of residents (minimum--10).
61-120 residents.......................  20% of residents (minimum--15).
121-200 residents......................  15% of residents (minimum--24).
201+ residents.........................  10% of residents (minimum--30).
 
------------------------------------------------------------------------
\1\ Maximum--50.

    Note that the calculation is based on the resident census, not beds. 
After determining the appropriate sample size, select residents for the 
sample in a random manner. You may, for example, select every fifth 
resident from the resident census, beginning at a random position on the 
list. For surveys of dually certified facilities or distinct part SNFs/
ICFs, first use the combined SNF/ICF population to calculate the size of 
the sample, and then select a sample that reflects the proportions of 
SNF and ICF residents in the facility's overall population.
    (2) Special Care Needs/Treatments. The survey form specifies several 
care needs/treatments that must always be reviewed when they apply to 
any facility residents. These include:

 Decubitus Care
 Restraints
 Catheters
 Injections, Parenteral Fluids, Colostomy/Ileostomy, 
    Respiratory Care, Tracheostomy Care, Suctioning, Tube Feeding
 Rehabilitative Services (physical therapy, speech 
    pathology and audiology services, occupational therapy)

    Due to the relatively low prevalence of these care needs/treatments, 
appropriate residents may be either under-

represented or entirely omitted from the sample. Therefore, determine 
during the tour how many residents in the random selection fall into 
each of these care categories. Then, compare the number of such 
residents in the random selection with the total number of residents in 
the facility with each specified care need/treatment (based on either 
the resident census or other information provided by the facility).
    Review no less than 25 percent of the residents in each of these 
special care needs/treatments categories. For example, if the facility 
has 10 residents with

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decubitus ulcers, but only one of these residents is selected randomly, 
review two more residents with decubitis ulcers (25% of 10 equals 2.5, 
so review a total of 3). Or, if the facility has two residents who 
require tube feeding, neither of whom is in the random selection, review 
the care of at least one of the these residents. This can be 
accomplished in the following manner:
    Conduct in-depth reviews of the randomly selected residents and then 
perform limited reviews of additional residents as needed to cover the 
specified care categories. Such reviews are limited to the care and 
services related to the pertinent care areas only, e.g., catheters, 
restraints, or colostomy. Utilize those worksheets or portions of 
worksheets which are appropriate to the limited review. Refer to the 
Care Guidelines, as a resource document, when appropriate.
    Always keep in mind that neither the random selection approach nor 
the review of residents within the specified care categories precludes 
investigation of other resident care situations that you believe might 
pose a serious threat to a resident's health or safety. Add to the 
sample, as appropriate.
    (e) Task 3--Tour of the Facility--(1) Purpose. Conduct the tour in 
order to:
     Develop an overall picture of the types and 
patterns of care delivery present within the facility;
     View the physical environment; and
     Ascertain whether randomly selected residents are 
communicative and willing to be interviewed.
    (2) Protocol. You may tour the entire facility as a team or 
separately, as long as all areas of the facility are examined by at 
least one team member. Success of the latter approach, however, is 
largely dependent on open intra-team communication and the ability of 
each team member to identify situations for further review by the team 
member of the appropriate discipline. You may conduct the tour with or 
without facility staff accompanying you, as you prefer. Facilities, 
however, vary in staff member availability. Record your notes on the 
Tour Notes Worksheet, Form CMS-521.
    Allow approximately three hours for the tour. Converse with 
residents, family members/significant others (if present), and staff, 
asking open-ended questions in order to confirm observations, obtain 
additional information, or corroborate information, (e.g., accidents, 
odors, apparent inappropriate dress, adequacy and appropriateness of 
activities). Converse sufficiently with residents selected for in-depth 
review to ascertain whether they are willing to be interviewed and are 
communicative. Observe staff interactions with other staff members as 
well as with residents for insight into matters such as resident rights 
and assignments of staff responsibilities.
    Always knock and/or get permission before entering a room or 
interrupting privacy. If you wish to inspect a resident's skin, observe 
a treatment procedure, or observe a resident who is exposed, courteously 
ask permission from the resident if she/he comprehends, or ask 
permission from the staff nurse if the resident cannot communicate. Do 
not do ``hands-on'' monitoring such as removal of dressings; ask staff 
to remove a dressing or handle a resident.
    (3) Resident Needs. While touring, focus on the residents' needs--
physical, emotional, psychosocial, or spiritual--and whether those needs 
are being met. Refer to the following list as needed:

--Personal hygiene, grooming, and appropriate dress
--Position
--Assistive and other restorative devices
--Rehabilitation issues
--Functional limitations in ADL
--Functional limitations in gait, balance and coordination
--Hydration and nutritional status
--Resident rights
--Activity for time of day (appropriate or inappropriate)
--Emotional status
--Level of orientation
--Awareness of surroundings
--Behaviors
--Cleanliness of immediate environment (wheelchair, bed, bedside table, 
    etc.)
--Odors
--Adequate clothing and care supplies as well as maintenance and 
    cleanliness of same

    (4) Review of the Physical Environment. As you tour each resident's 
room and

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auxiliary rooms, also examine them in connection with the physical 
environment requirements. You need not document physical environment on 
the Tour Notes Worksheet. Instead, you may note any negative findings 
directly on the Survey Report Form in the remarks section.
    (5) Meeting With Resident Council Representatives. If a facility has 
a Resident Council, one or more surveyors meet with the respresentatives 
in a private area. Facility staff members do not attend unless 
specifically requested by the Council. Explain the purpose of the survey 
and briefly outline the steps in the survey process, i.e., entrance 
conference * * * exit conference. Indicate your interest in learning 
about the strengths of the facility in addition to any complaints or 
shortcomings. State that this meeting is one part of the information 
gathering; the findings have not yet been completed nor the conclusions 
formulated. Explain further, however, that the official survey findings 
are usually available within three months after the completion of the 
survey, and give the telephone number of the State agency office.
    Use this meeting to ascertain strengths and/or problems, if any, 
from the consumer's perspective, as well as to develop additional 
information about aspects of care and services gleaned during the tour 
that were possibly substandard.
    Conduct the meeting in a manner that allows for comments about any 
aspect of the facility. (See the section on Interview Procedures.) Use 
open-ended questions such as:

     ``What is best about this home?''
     ``What is worst?''
     ``What would you like to change?''

    In order to get more detail, use questions such as:

     ``Can you be more specific?''
     ``Can you give me an example?''
     ``What can anyone else tell me about this?''

    If you wish to obtain information about a topic not raised by the 
residents, use an approach like the following:

     ``Tell me what you think about the food/staff/
cleanliness here.''
     ``What would make it better?''
     ``What don't you like? What do you like?''

    (6) Tour Summation and Focus of Remaining Survey Activity. When the 
tour is completed, review the resident census data provided by the 
facility. Determine if the care categories specified in the section on 
Resident Sample are sufficiently represented in the random selection, 
make adjustments as needed, and complete the listing of residents on the 
worksheet labeled ``Residents Selected for In-depth Review'', Form CMS-
520.
    Transcribe notes of a negative nature onto the SRF in the 
``Remarks'' column under the appropriate rule. Findings from a later 
segment in the survey or gathered by another surveyor may combine to 
substantiate a deficiency. You need not check ``met'' or ``not met'' at 
this point in the survey. Discuss significant impressions/conclusions at 
the completion of each subsequent survey task, and transfer any negative 
findings onto the Survey Report Form in the Remarks section.
    (f) Task 4--Observation/Interview/Medical Record Review (including 
drug regimen review). Perform the in-depth review of each individual in 
the resident sample in order to ascertain whether the facility is 
meeting resident needs. Evaluate specific indicators for each resident, 
utilizing the front and back of the ``Observation/Interview/Record 
Review (OIRR)'' worksheet, Form CMS-524. You may prefer to perform the 
record review first, complete resident/staff/family observations and 
interviews, and finally, return to the record for any final unresolved 
issues. On the other hand, you may prefer to do the interviews first. 
Either method is acceptable. Whenever possible, however, complete one 
resident's observation/interview/medical record review and document the 
OIRR before moving onto another resident. If because of the facility 
layout, it is more efficient to do more than one record review at a 
time, limit such record review to two or three residents so your 
familiarity with the particular resident and continuity of the OIRR are 
not compromised.
    (1) Observation. Conduct observations concurrently with interviews 
of residents, family/significant others, and

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discussions with direct care staff [of the various disciplines involved. 
In multi-facility operations, whenever possible, observe staff that is 
regularly assigned to the facility in order to gain an understanding of 
the care and services usually provided.] Maintain respect for resident 
privacy. Minimize disruption of the operations of the facility or 
impositions upon any resident as much as possible. Based upon your 
observations of the residents' needs, gather information about any of 
the following areas, as appropriate:

Bowel and bladder training
Catheter care
Restraints
Injections
Parenteral fluids
Tube feeding/gastrostomy
Colostomy/ileostomy
Respiratory therapy
Tracheostomy care
Suctioning

    (2) Interviews. Interview each resident in private unless he/she 
independently requests that a facility staff member or other individual 
be present. Conduct the in-depth interview in a nonthreatening and 
noninvasive fashion so as to decrease anxiety and defensiveness. The 
open-ended approach described in the section on the Resident Council is 
also appropriate for the in-depth interview. While prolonged time 
expenditure is not usually a worthwhile use of resources or the 
resident's time, do allow time initially to establish rapport.
    At each interview:

     Introduce yourself.
     Address the resident by name.
     Explain in simple terms the reason for your visit 
(e.g., to assure that the care and services are adequate and appropriate 
for each resident).
     Briefly outline the process--entrance conference, 
tour, interviews, observations, review of medical records, resident 
interviews, and exit conference.
     Mention that the selection of a particular 
resident for an interview is not meant to imply that his/her care is 
substandard or that the facility provides substandard care. Also mention 
that most of those interviewed are selected randomly.
     Assure that you will strive for anonymity for the 
resident and that the interview is used in addition to medical records, 
observations, discussions, etc., to capture an accurate picture of the 
treatment and care provided by the facility. Explain that the official 
findings of the survey are usually available to the public about three 
months after completion of the survey, but resident names are not given 
to the public.
     When residents experience difficulty expressing 
themselves:

--Avoid pressuring residents to verbalize
--Accept and respond to all communication
--Ignore mistakes in word choice
--Allow time for recollection of words
--Encourage self-expression through any means available

     When interviewing residents with decreased 
receptive capacity:

--Speak slowly and distinctly
--Speak at conversational voice level
--Sit within the resident's line of vision
 Listen to all resident information/allegations 
    without judgment. Information gathered subsequently may substantiate 
    or repudiate an allegation.

    The length of the interview varies, depending on the condition and 
wishes of the resident and the amount of information supplied. Expect 
the average interview, however, to last approximately 15 minutes. 
Courteously terminate an interview whenever the resident is unable or 
unwilling to continue, or is too confused or disoriented to continue. 
Do, however, perform the other activities of this task (observation and 
record review). If, in spite of your conversing during the tour, you 
find that less than 40 percent of the residents in your sample are 
sufficiently alert and willing to be interviewed, try to select 
replacements so that a complete OIRR is performed for a group this size, 
if possible. There may be situations, however, where the resident 
population has a high percentage of confused individuals and this 
percentage is not achievable. Expect that the information from confused 
individuals can be, but is not necessarily, less

[[Page 300]]

reliable than that from more alert individuals.
    Include the following areas in the interview of each resident in the 
sample:

Activities of daily living
Grooming/hygiene
Nutrition/dietary
Restorative/rehabilitation care and services
Activities
Social services
Resident rights

    Refer to the Care Guidelines ``evaluation factors'' as a resource 
for possible elements to consider when focusing on particular aspects of 
care and resident needs.
    Document information obtained from the interviews/observations on 
the OIRR Worksheet. Record in the ``Notes'' section any additional 
information you may need in connection with substandard care or 
services. Unless the resident specifically requests that he/she be 
identified, do not reveal the source of the information gleaned from the 
interview.
    (3) Medical Record Review. The medical record review is a three-part 
process, which involves first reconciling the observation/interview 
findings with the record, then reconciling the record against itself, 
and lastly performing the drug regimen review.
    Document your findings on the OIRR Worksheet, as appropriate, and 
summarize on the Survey Report Form the findings that are indicative of 
problematic or substandard care. Be alert for repeated similar instances 
of substandard care developing as the number of completed OIRR 
Worksheets increases.

    Note: The problems related to a particular standard or condition 
could range from identical (e.g., meals not in accordance with dietary 
plan) to different but related (e.g., nursing services--lapse in care 
provided to residents with catheters, to residents with contractures, to 
residents needing assistance for personal hygiene and residents with 
improperly applied restraints).

    (i) Reconciling the observation/interview findings with the record. 
Determine if:

     An assessment has been performed.
     A plan with goals has been developed.
     The interventions have been carried out.
     The resident has been evaluated to determine the 
effectiveness of the interventions.

    For example, if a resident has developed a decubitus ulcer while in 
the facility, record review can validate staff and resident interviews 
regarding the facility's attempts at prevention. Use your own judgment; 
review as much of the record(s) as necessary to evaluate the care 
planning. Note that facilities need not establish specific areas in the 
record stating ``Assessment,'' ``Plan,'' ``Intervention,'' or 
``Evaluation'' in order for the documentation to be considered adequate.
    (ii) Reconciling the record with itself. Determine:

     If the resident has been properly assessed for 
all his/her needs.
     That normal and routine nursing practices such as 
periodic weights, temperatures, blood pressures, etc., are performed as 
required by the resident's conditions.

    (iii) Performing the drug regimen review. The purpose of the drug 
regimen review is to determine if the pharmacist has reviewed the drug 
regimen on a monthly basis. Follow the procedures in Part One of 
Appendix N, Surveyor Procedures for Pharmaceutical Service Requirements 
in Long-Term Care Facilities. Fill in the appropriate boxes on the top 
left hand corner of the reverse side of the OIRR Worksheet, Form CMS-
524. Appendix N lists many irregularities that can occur. Review at 
least six different indicators on each survey. However, the same six 
indicators need not be reviewed on every survey.

    Note: If you detect irregularities and the documentation 
demonstrates that the pharmacist has notified the attending physician, 
do not cite a deficiency. Do, however, bring the irregularity to the 
attention of the medical director or other facility official, and note 
the official's name and date of notification on the Survey Report Form.
    (g) Task 5--Drug Pass Observation. The purpose of the drug pass 
observation is to observe the actual preparation and administration of 
medications to residents. With this approach, there is no doubt that the 
errors detected, if any, are errors in drug administration, not

[[Page 301]]

documentation. Follow the procedure in Part Two of Appendix N, Surveyor 
Procedures for Pharmaceutical Service Requirements in Long-Term Care 
Facilities, and complete the Drug Pass Worksheet, Form CMS-522. Be as 
neutral and unobtrusive as possible during the drug pass observation. 
Whenever possible, select one surveyor, who is a Registered Nurse or a 
pharmacist, to observe the drug pass of approximately 20 residents. In 
facilities where fewer than 20 residents are receiving medications, 
review as many residents receiving medications as possible. Residents 
selected for the in-depth review need not be included in the group 
chosen for the drug pass; however, their whole or partial inclusion is 
acceptable. In order to get a balanced view of a facility's practices, 
observe more than one person administering a drug pass, if feasible. 
This might involve observing the morning pass one day in Wing A, for 
example, and the morning pass the next day in Wing B.
    Transfer findings noted on the ``Drug Pass'' worksheet to the SRF 
under the appropriate rule. If your team concludes that the facility's 
medication error rate is 5 percent or more, cite the deficiency under 
Nursing Services/Administration of Drugs. Report the error rate under 
F209. If the deficiency is at the standard level, cite it in Nursing 
Services, rather than Pharmacy.
    (h) Task 6--Dining Area and Eating Assistance Observation. The 
purpose of this task is to ascertain the extent to which the facility 
meets dietary needs, particularly for those who require eating 
assistance. This task also yields information about staff interaction 
with residents, promptness and appropriateness of assistance, adaptive 
equipment usage and availability, as well as appropriateness of dress 
and hygiene for meals.
    For this task, use the worksheet entitled ``Dining Area and Eating 
Assistance Observation'' (Form CMS-523). Observe two meals; for a 
balanced view, try to observe meals at different times of the day. For 
example, try to observe a breakfast and a dinner rather than two 
breakfasts. Give particular care to performing observations as 
unobtrusively as possible. Chatting with residents and sitting down 
nearby may help alleviate resident anxiety over the observation process.
    Select a minimum of five residents for each meal observation and 
include residents who have their meals in their rooms. Residents 
selected for the in-depth review need not be included in the dining and 
eating assistance observation; however, their whole or partial inclusion 
is acceptable. Ascertain the extent to which the facility assesses, 
plans, and evaluates the nutritional care of residents and eating 
assistance needs by reviewing the sample of 10 or more residents. If you 
are unable to determine whether the facility meets the standards from 
the sample reviewed, expand the sample and focus on the specific area(s) 
in question, until you can formulate a conclusion about the extent of 
compliance. As with the other survey tasks, transfer the findings noted 
on the ``Dining & Eating Assistance Observation'' worksheet to the 
Survey Report Form.
    (i) Task 7--Forming the Deficiency Statement--(1) General. The 
Survey Report Form contains information about all of the negative 
findings of the survey. Be sure to transfer to the Survey Report Form 
data from the tour, drug pass observation, dining area and eating 
assistance observation, as well as in-depth review of the sample of 
residents. Transfer only those findings which could possibly contribute 
to a determination that the facility is deficient in a certain area.
    Meet as a group in a pre-exit conference to discuss the findings and 
make conclusions about the deficiencies, subject to information provided 
by facility officials that may further explain the situation. Review the 
summaries/conclusions from each task and decide whether any further 
information and/or documentation is necessary to substantiate a 
deficiency. As the facility for additional information for clarification 
about particular findings, if necessary. Always consider information 
provided by the facility. If the facility considers as acceptable, 
practices which you believe are not acceptable, ask the facility to 
backup its contention with suitable reference material or sources and 
submit them for your consideration.

[[Page 302]]

    (2) Analysis. Analyze the findings on the Survey Report Form for the 
degree of severity, frequency of occurrence and impact on delivery of 
care or quality of life. The threshold at which the frequency of 
occurrences amounts to a deficiency varies from situation to situation. 
One occurrence directly related to a life-threatening or fatal outcome 
can be cited as a deficiency. On the other hand, a few sporadic 
occurrences may have so slight an impact on delivery of care or quality 
of life that they do not warrant a deficiency citation. Review carefully 
all the information gathered. What may appear during observation as a 
pattern, may or may not be corroborated by records, staff, and 
residents. For example, six of the 32 residents in the sample are 
dressed in mismatched, poorly buttoned clothes. A few of the six are 
wearing slippers without socks. A few others are wearing worn clothes. 
Six occurrences might well be indicative of a pattern of susbstandard 
care. Close scrutiny of records, discussions with staff, and interviews 
reveal, however, that the six residents are participating in dressing 
retraining programs. Those residents who are without socks, chose to do 
so. The worn clothing items were also chosen--they are favorites.
    Combinations of substandard care such as poor grooming of a number 
of residents, lack of ambulation of a number of residents, lack of 
attention to positioning, poor skin care, etc., can yield a deficiency 
in nursing services just as 10 out of 10 residents receiving substandard 
care for decubiti yields a deficiency.
    (3) Deficiencies Alleged by Staff or Residents. If staff or 
residents allege deficiencies, but records, interviews, and observation 
fail to confirm the situation, it is unlikely that a deficiency exists. 
Care and services that are indeed confirmed by the survey to be in 
compliance with the regulatory requirements, but considered deficient by 
residents or staff, cannot be cited as deficient for certification 
purposes. On the other hand, if an allegation is of a very serious 
nature (e.g., resident abuse) and the tools of record review and 
observation are not effective because the problem is concealed, obtain 
as much information as possible or necessary to ascertain compliance, 
and cite accordingly. Residents, family, or former employees may be 
helpful for information gathering.
    (4) Composing the Deficiency Statement. Write the deficiency 
statement in terms specific enough to allow a reasonably knowledgeable 
person to understand the aspect(s) of the requirement(s) that is (are) 
not met. Do not delve into the facility's policies and procedures to 
determine or speculate on the root cause of a deficiency, or sift 
through various alternatives in an effort to prescribe an acceptable 
remedy. Indicate the data prefix tag and regulatory citation, followed 
by a summary of the deficiency and supporting findings using resident 
identifiers, not resident names, as in the following example.

    F102 SNF 405.1123(b).--Each resident has not had a physician's visit 
at least once every 30 days for the first 90 days after admission. 
Resident 1602 has not been seen by a physician since she was 
admitted 50 days ago. Her condition has deteriorated since that time 
(formulation of decubiti, infections).

    When the data prefix tag does not repeat the regulations, also 
include a short phrase that describes the prefix tag (e.g., F117 
decubitus ulcer care). List the data tags in numerical order, whenever 
possible.
    (j) Task 8--Exit Conference. The purpose of the exit conference is 
to inform the facility of survey findings and to arrange for a plan of 
correction, if needed. Keep the tone of the exit conference consistent 
with the character of the survey process--inspection and enforcement. 
Tactful, business-like, professional presentation of the findings is of 
paramount importance. Recognize that the facility may wish to respond to 
various findings. Although deficiency statements continue to depend, in 
part, on surveyor professional judgment, support your conclusions with 
resident-specific examples (identifiers other than names) whenever you 
can do so without compromising confidentiality. Before formally citing 
deficiencies, discuss any allegations or findings that could not be 
substantiated during earlier tasks in the process. For example, if 
information is gathered that suggests a newly hired

[[Page 303]]

R.N. is not currently licensed, ask the facility officials to present 
current licensure information for the nurse in question. Identify 
residents when the substandard care is readily observed or discerned 
through record review. Ensure that the facility improves the care 
provided to all affected residents, not only the identified residents. 
Make clear to the facility that during a follow-up visit the surveyors 
may review residents other than those with significant problems from the 
original sample, in order to see that the facility has corrected the 
problems overall. Do not disclose the source of information provided 
during interviews, unless the resident has specifically requested you to 
inform the facility of his/her comments or complaints. In accordance 
with your Agency's policy, present the Statement of Deficiencies, form 
CMS-2567, on site or after supervisory review, no later than 10 calendar 
days following the survey.
    (k) Plan of Correction. Explain to the facility that your role is to 
identify care and services which are not consistent with the regulatory 
requirements, rather than to ascertain the root causes of deficiencies. 
Each facility is expected to review its own care delivery. Subsequent to 
the exit conference, each facility is required to submit a plan of 
correction that identifies necessary changes in operation that will 
assure correction of the cited deficiencies. In reviewing and accepting 
a proposed plan of correction, apply these criteria:

     Does the facility have a reasonable approach for 
correcting the deficiencies?
     Is there a high probability that the planned 
action will result in compliance?
     Is compliance expected timely?

    Plans of correction specific to residents identified on the 
deficiency statement are acceptable only where the deficiency is 
determined to be unique to that resident and not indicative of a 
possible systemic problem. For example, as a result of an aide being 
absent, two residents are not ambulated three times that day as called 
for in their care plans. A plan of correction that says ``Ambulate John 
Jones and Mary Smith three times per day,'' is not acceptable. An 
acceptable plan of correction would explain changes made to the 
facility's staffing and scheduling in order to gurantee that staff is 
available to provide all necessary services for all residents.
    Acceptance of the plan of correction does not absolve the facility 
of the responsibility for compliance should the implementation not 
result in correction and compliance. Acceptance indicates the State 
agency's acknowledgement that the facility indicated a willingness and 
ability to make corrections adequately and timely.
    Allow the facility up to 10 days to prepare and submit the plan of 
correction to the State agency, however, follow your SA policy if the 
timeframe is shorter. Retain the various survey worksheets as well as 
the Survey Report Form at the State agency. Forward the deficiency 
statement to the CMS regional office.
    (l) Follow-up Surveys. The purpose of the follow-up survey is to re-
evaluate the specific types of care or care delivery patterns that were 
cited as deficient during the original survey. Ascertain the corrective 
status of all deficiencies cited on the CMS-2567. Because this survey 
process focuses on the actual provision of care and services, revisits 
are almost always necessary to ascertain whether the deficienicies have 
indeed been corrected. The nature of the deficiencies dictates the scope 
of the follow-up visit. Use as many tasks or portions of the Survey 
Report Form(s) as needed to ascertain compliance status. For example, 
you need not perform another drug pass if no drug related deficiencies 
were cited on the initial survey. Similarly, you need not repeat the 
dining area and eating assistance observations if no related problems 
were identified. All or some of the aspects of the observation/
interview/medical record review, however, are likely to be appropriate 
for the follow-up survey.
    When selecting the resident sample for the follow-up, determine the 
sample size using the same formula as used earlier in the survey, with 
the following exceptions:

     The maximum sample size is 30 residents, rather 
than 50.

[[Page 304]]

     The minimum sample size of 10 residents does not 
apply if only one care category was cited as deficient and the total 
number of residents in the facility in that category was less than 10 
(e.g., deficiency cited under catheter care and only five residents have 
catheters).

    Include in the sample those residents who, in your judgment, are 
appropriate for reviewing vis-a-vis the cited substandard care. If 
possible, include some residents identified as receiving substandard 
care during the initial survey. If after completing the follow-up 
activities you determine that the cited deficiencies were not corrected, 
initiate adverse action procedures, as appropriate.
    (m) Role of Surveyor. The survey and certification process is 
intended to determine whether providers and suppliers meet program 
participation requirements. The primary role of the surveyor, then, is 
to assess the quality of care and services and to relate those findings 
to statutory and regulatory requirements for program participation.
    When you find substandard care or services in the course of a 
survey, carefully document your findings. Explain the deficiency in 
sufficient detail so that the facility officials understand your 
rationale. If the cause of the deficiency is obvious, share the 
information with the provider. For example, if you cite a deficiency for 
restraints (F118), indicate that restraints were applied backwards on 
residents 1621, 1634, 1646, etc.
    In those instances where the cause is not obvious, do not delve into 
the facility's policies and procedures to determine the root cause of 
any deficiency. Do not recommend or prescribe an acceptable remedy. The 
provider is responsible for deciding on and implementing the action(s) 
necessary for achieving compliance. For the restraint situation in the 
example above, you would not ascertain whether the improper application 
was due to improper training or lack of training, nor would you attempt 
to identify the staff member who applied the restraints. It is the 
provider's responsibility to make the necessary changes or corrections 
to ensure that the restriants are applied properly.
    A secondary role for the surveyor is to provide general consultation 
to the provider/consumer community. This includes meeting with provider/
consumer associations and other groups as well as participating in 
seminars. It also includes informational activities, whereby you respond 
to oral or written inquiries about required outcomes in care and 
services.
    (n) Confidentiality and Respect for Resident Privacy. Conduct the 
survey in a manner that allows for the greatest degree of 
confidentiality for residents, particularly regarding the information 
gathered during the in-depth interviews. When recording observations 
about care and resident conditions, protect the privacy of all 
residents. Use a code such as resident identifier number rather than 
names on worksheets whenever possible. Never use a resident's name on 
the Deficiency Statement, Form CMS-2567. Block out resident names, if 
any, from any document that is disclosed to the facility, individual or 
organization.
    When communicating to the facility about substandard care, fully 
identify the resident(s) by name if the situation was identified through 
observation or record review. Improperly applied restraints, expired 
medication, cold food, gloves not worn for a sterile procedure, and diet 
inconsistent with order, are examples of problems which can be 
identified to the facility by resident name. Information about injuries 
due to broken equipment, prolonged use of restraints, and opened mail is 
less likely to be obtained through observation or record review. Do not 
reveal the source of information unless actually observed, discovered in 
the record review, or requested by the resident or family.
    (o) Team Composition. Whenever possible, use the following survey 
team model:

                        SNF/ICF Survey Team Model

    In facilities with 200 beds or less, the team size may range from 2 
to 4 members. If the team size is:

     2 members: The team has at least one RN plus 
another RN or a dietitian or a pharmacist.

[[Page 305]]

     3-4 member: In addition to the composition 
described above, the team has one or two members of any discipline such 
as a social worker, sanitarian, etc.

    If the facility has over 200 beds and the survey will last more than 
2 days, the team size may be greater than 4 members. Select additional 
disciplines as appropriate to the facility's compliance history.
    Average onsite time per survey: 60 person hours (Number of surveyors 
multiplied by the number of hours on site)
    Preferably, team members have gerontological training and 
experience. Any member may serve as the team leader, consistent with 
State agency procedures. In followup surveys, select disciplines based 
on major areas of correction. Include a social worker, for example, if 
the survey revealed major psychosocial problems. This model does not 
consider integrated survey and Inspection of Care review teams, which 
typically would be larger.
    (p) Type of Facility--Application of SNF or ICF Regulations. Apply 
the regulations to the various types of facilities in the following 
manner:

             Apply SNF regulations.
 Freestanding Skilled Nursing
 Facility (SNF)
             Apply ICF regulations.
 Freestanding Intermediate
 Care Facility (ICF)
 SNF         Apply SNF regulations.
 Distinct Part of a Hospital
 ICF         Apply ICF regulations.
 Distinct Part of a Hospital
 Dually      Apply SNF regulations and 442.346(b).
 Certified SNF/ICF
             Apply SNF regulations for SNF unit.
 Freestanding SNF with ICF     Apply ICF regulations for ICF distinct
 Distinct Part (Regardless of   part.
 the proportion of SNF and     Apply both SNF and ICF regulations for
 ICF beds, the facility type    shared services (e.g., dietary).
 is determined by the higher   If the same deficiency occurs in both the
 level of care. Therefore,      SNF and ICF components of the facility,
 LTC facilities with distinct   cite both SNF and ICF regulations.
 parts are defined as SNFs     If the deficiency occurs in the SNF part
 with ICF distinct parts.)      only, cite only the SNF regulation.
                               If the deficiency occurs in the ICF part
                                only, cite only the ICF regulation.
 

    (q) Use of Part A and Part B of the Survey Report--(1) Use of Part A 
(CMS-525). Use Part A for initial certification surveys only, except 
under the following circumstances:

     When a terminated facility requests program 
participation 60 days or more after termination. Treat this situation as 
a request for initial certification and complete Part A of the survey 
report in addition to Part B.
     If an ICF with a favorable compliance history 
requests to covert a number of beds to SNF level, complete both Part A 
and Part B for compliance with the SNF requirements. If distinct part 
status is at issue, also examine whether it meets the criteria for 
certification as a distinct part.

    (i) Addendum for Outpatient Physical Therapy (OPT) or Speech 
Pathology Services. Use the Outpatient Physical Therapy--Speech 
Pathology SRF (CMS-1893) as an addendum to Part A.
    (ii) Resurvey of Participating Facilities. Do not use Part A for 
resurveys of participating SNFs and ICFs. A determination of compliance, 
based on documented examination of the written policies and procedures 
and other pertinent documents during the initial survey, establishes the 
facility's compliance status with Part A requirements. This does not 
preclude citing deficiencies if they pertain to administrative or 
structural requirements from Part A that are uncovered incidental to a 
Part B survey. As an assurance measure, however, each facility at the 
time of recertification must complete an affidavit (on the CMS-1516) 
attesting that no substantive changes have occurred that would affect 
compliance. Each facility must also agree to notify the State agency 
immediately of any upcoming changes in its organization or management 
which may affect its compliance status. If a new administrator is unable 
to complete the affidavit, proceed with the survey using the Part B form 
and worksheets; do not use the Part A form. The survey cannot be 
considered complete, however, until the affidavit is signed. If the 
facility fails to complete the affidavit, it cannot participate in the 
program.
    (iii) Substantial Changes in a Facility's Organization and 
Management. If you receive such information, review the changes to 
ensure compliance with the regulations. Request copies of the 
appropriate documents (e.g., written policies and procedures, personnel 
qualifications, or agreements) if they were

[[Page 306]]

not submitted. If the changes have made continued compliance seem 
doubtful, determine through a Part B survey whether deficiencies have 
resulted. Cite any deficiencies on the CMS-2567 and follow the usual 
procedures.
    (2) Use of Part B (CMS-519). Use Part B and the worksheets for all 
types of SNF and ICF surveys--initials, recertifications, followup, 
complaints, etc.
    The worksheets are:

 CMS-520--Residents Selected for Indepth Review
 CMS-521--Tour Notes Worksheet
 CMS-522--Drug Pass Worksheet
 CMS-523--Dining Area and Eating Assistance Worksheet
 CMS-5245--Observation/Interview/Record Review 
    Worksheet

    For complaint investigations, perform a full or partial Part B 
survey based on the extent of the allegations. If the complaint alleges 
substandard care in a general fashion or in a variety of services and 
care areas, perform several tasks or a full Part B survey, as needed. If 
the complaint is of a more specific nature, such as an allegation of 
improper medications, perform an appropriate partial Part B survey, such 
as a drug pass review and a review of selected medical records.

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 Subpart D_Reconsideration of Adverse Determinations_Deeming Authority 
for Accreditation Organizations and CLIA Exemption of Laboratories Under 
                             State Programs

    Source: 57 FR 34012, July 31, 1992, unless otherwise noted.



Sec.  488.201  Reconsideration.

    (a) Right to reconsideration. (1) A national accreditation 
organization dissatisfied with a determination that its accreditation 
requirements do not provide (or do not continue to provide) reasonable 
assurance that the entities accredited by the accreditation organization 
meet the applicable long-term care requirements, conditions for 
coverage, conditions of certification, conditions of participation, or 
CLIA condition level requirements is entitled to a reconsideration as 
provided in this subpart.
    (2) A State dissatisfied with a determination that the requirements 
it imposes on laboratories in that State and under the laws of that 
State do not provide (or do not continue to provide) reasonable 
assurance that laboratories licensed or approved by the State meet 
applicable CLIA requirements is entitled to a reconsideration as 
provided in this subpart.
    (b) Eligibility for reconsideration. CMS will reconsider any 
determination to deny, remove or not renew the approval of deeming 
authority to private accreditation organizations, or any determination 
to deny, remove or not renew the approval of a State laboratory program 
for the purpose of exempting the State's laboratories from CLIA 
requirements, if the accreditation organization or State files a written 
request for a reconsideration in accordance with paragraphs (c) and (d) 
of this section.
    (c) Manner and timing of request for reconsideration. (1) A national 
accreditation organization or a State laboratory program described in 
paragraph (b), dissatisfied with a determination with respect to its 
deeming authority, or, in the case of a State, a determination with 
respect to the exemption of the laboratories in the State from CLIA 
requirements, may request a reconsideration of the determination by 
filing a request with CMS either directly by its authorized officials or 
through its legal representative. The request must be filed within 60 
days of the receipt of notice of an adverse determination or nonrenewal 
as provided in subpart A of part 488 or subpart E of part 493, as 
applicable.
    (2) Reconsideration procedures are available after the effective 
date of the decision to deny, remove, or not renew the approval of an 
accreditation organization or State laboratory program.
    (d) Content of request. The request for reconsideration must specify 
the findings or issues with which the accreditation organization or 
State disagrees and the reasons for the disagreement.

[57 FR 34012, July 31, 1992, as amended at 58 FR 61843, Nov. 23, 1993]



Sec.  488.203  Withdrawal of request for reconsideration.

    A requestor may withdraw its request for reconsideration at any time 
before the issuance of a reconsideration determination.



Sec.  488.205  Right to informal hearing.

    In response to a request for reconsideration, CMS will provide the 
accreditation organization or the State laboratory program the 
opportunity for an informal hearing as described in Sec.  488.207 that 
will--
    (a) Be conducted by a hearing officer appointed by the Administrator 
of CMS; and
    (b) Provide the accreditation organization or State laboratory 
program the opportunity to present, in writing or in person, evidence or 
documentation to refute the determination to deny approval, or to 
withdraw or not renew deeming authority or the exemption of a State's 
laboratories from CLIA requirements.



Sec.  488.207  Informal hearing procedures.

    (a) CMS will provide written notice of the time and place of the 
informal hearing at least 10 days before the scheduled date.
    (b) The informal reconsideration hearing will be conducted in 
accordance with the following procedures--

[[Page 445]]

    (1) The hearing is open to CMS and the organization requesting the 
reconsideration, including--
    (i) Authorized representatives;
    (ii) Technical advisors (individuals with knowledge of the facts of 
the case or presenting interpretation of the facts); and
    (iii) Legal counsel;
    (2) The hearing is conducted by the hearing officer who receives 
testimony and documents related to the proposed action;
    (3) Testimony and other evidence may be accepted by the hearing 
officer even though it would be inadmissable under the usual rules of 
court procedures;
    (4) Either party may call witnesses from among those individuals 
specified in paragraph (b)(1) of this section; and
    (5) The hearing officer does not have the authority to compel by 
subpoena the production of witnesses, papers, or other evidence.



Sec.  488.209  Hearing officer's findings.

    (a) Within 30 days of the close of the hearing, the hearing officer 
will present the findings and recommendations to the accreditation 
organization or State laboratory program that requested the 
reconsideration.
    (b) The written report of the hearing officer will include--
    (1) Separate numbered findings of fact; and
    (2) The legal conclusions of the hearing officer.



Sec.  488.211  Final reconsideration determination.

    (a) The hearing officer's decision is final unless the 
Administrator, within 30 days of the hearing officer's decision, chooses 
to review that decision.
    (b) The Administrator may accept, reject or modify the hearing 
officer's findings.
    (c) Should the Administrator choose to review the hearing officer's 
decision, the Administrator will issue a final reconsideration 
determination to the accreditation organization or State laboratory 
program on the basis of the hearing officer's findings and 
recommendations and other relevant information.
    (d) The reconsideration determination of the Administrator is final.
    (e) A final reconsideration determination against an accreditation 
organization or State laboratory program will be published by CMS in the 
Federal Register.



     Subpart E_Survey and Certification of Long-Term Care Facilities

    Source: 59 FR 56238, Nov. 10, 1994, unless otherwise noted.



Sec.  488.300  Statutory basis.

    Sections 1819 and 1919 of the Act establish requirements for 
surveying SNFs and NFs to determine whether they meet the requirements 
for participation in the Medicare and Medicaid programs.



Sec.  488.301  Definitions.

    As used in this subpart--
    Abbreviated standard survey means a survey other than a standard 
survey that gathers information primarily through resident-centered 
techniques on facility compliance with the requirements for 
participation. An abbreviated standard survey may be premised on 
complaints received; a change of ownership, management, or director of 
nursing; or other indicators of specific concern.
    Abuse means the willful infliction of injury, unreasonable 
confinement, intimidation, or punishment with resulting physical harm, 
pain or mental anguish.
    Deficiency means a SNF's or NF's failure to meet a participation 
requirement specified in the Act or in part 483, subpart B of this 
chapter.
    Dually participating facility means a facility that has a provider 
agreement in both the Medicare and Medicaid programs.
    Extended survey means a survey that evaluates additional 
participation requirements subsequent to finding substandard quality of 
care during a standard survey.
    Facility means a SNF or NF, or a distinct part SNF or NF, in 
accordance with Sec.  483.5 of this chapter.

[[Page 446]]

    Immediate family means husband or wife; natural or adoptive parent, 
child or sibling; stepparent, stepchild, stepbrother, or stepsister; 
father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-
law, or sister-in-law; grandparent or grandchild.
    Immediate jeopardy means a situation in which the provider's 
noncompliance with one or more requirements of participation has caused, 
or is likely to cause, serious injury, harm, impairment, or death to a 
resident.
    Misappropriation of resident property means the deliberate 
misplacement, exploitation, or wrongful, temporary or permanent use of a 
resident's belongings or money without the resident's consent.
    Neglect means failure to provide goods and services necessary to 
avoid physical harm, mental anguish, or mental illness.
    Noncompliance means any deficiency that causes a facility to not be 
in substantial compliance.
    Nurse aide means an individual, as defined in Sec.  483.75(e)(1) of 
this chapter.
    Nursing facility (NF) means a Medicaid nursing facility.
    Paid feeding assistant means an individual who meets the 
requirements specified in Sec.  483.35(h)(2) of this chapter and who is 
paid to feed residents by a facility, or who is used under an 
arrangement with another agency or organization.
    Partial extended survey means a survey that evaluates additional 
participation requirements subsequent to finding substandard quality of 
care during an abbreviated standard survey.
    Skilled nursing facility (SNF) means a Medicare nursing facility.
    Standard survey means a periodic, resident-centered inspection which 
gathers information about the quality of service furnished in a facility 
to determine compliance with the requirements for participation.
    Substandard quality of care means one or more deficiencies related 
to participation requirements under Sec.  483.13, Resident behavior and 
facility practices, Sec.  483.15, Quality of life, or Sec.  483.25, 
Quality of care of this chapter, which constitute either immediate 
jeopardy to resident health or safety; a pattern of or widespread actual 
harm that is not immediate jeopardy; or a widespread potential for more 
than minimal harm, but less than immediate jeopardy, with no actual 
harm.
    Substantial compliance means a level of compliance with the 
requirements of participation such that any identified deficiencies pose 
no greater risk to resident health or safety than the potential for 
causing minimal harm.
    Validation survey means a survey conducted by the Secretary within 2 
months following a standard survey, abbreviated standard survey, partial 
extended survey, or extended survey for the purpose of monitoring State 
survey agency performance.

[59 FR 56238, Nov. 10, 1994, as amended at 68 FR 55539, Sept. 26, 2003]



Sec.  488.303  State plan requirement.

    (a) A State plan must provide that the requirements of this subpart 
and subpart F of this part are met, to the extent that those 
requirements apply to the Medicaid program.
    (b) A State may establish a program to reward, through public 
recognition, incentive payments, or both, nursing facilities that 
provide the highest quality care to Medicaid residents. For purposes of 
section 1903(a)(7) of the Social Security Act, proper expenses incurred 
by a State in carrying out such a program are considered to be expenses 
necessary for the proper and efficient administration of the State plan.
    (c) A State must conduct periodic educational programs for the staff 
and residents (and their representatives) of NFs in order to present 
current regulations, procedures, and policies under this subpart and 
subpart F of this part.
    (d) Required remedies for a non-State operated NF. A State must 
establish, in addition to termination of the provider agreement, the 
following remedies or an approved alternative to the following remedies 
for imposition against a non-State operated NF:
    (1) Temporary management.
    (2) Denial of payment for new admissions.
    (3) Civil money penalties.
    (4) Transfer of residents.
    (5) Closure of the facility and transfer of residents.
    (6) State monitoring.

[[Page 447]]

    (e) Optional remedies for a non-State operated NF. A State may 
establish the following remedies for imposition against a non-State 
operated NF:
    (1) Directed plan of correction.
    (2) Directed in-service training.
    (3) Alternative or additional State remedies.
    (f) Alternative or additional State remedies. If a State uses 
remedies that are in addition to those specified in paragraph (d) or (e) 
of this section, or alternative to those specified in paragraph (d) of 
this section (other than termination of participation), it must--
    (1) Specify those remedies in the State plan; and
    (2) Demonstrate to CMS's satisfaction that those alternative 
remedies are as effective in deterring noncompliance and correcting 
deficiencies as the remedies listed in paragraphs (d) and (e) of this 
section.

[59 FR 56238, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.305  Standard surveys.

    (a) For each SNF and NF, the State survey agency must conduct 
standard surveys that include all of the following:
    (1) A case-mix stratified sample of residents;
    (2) A survey of the quality of care furnished, as measured by 
indicators of medical, nursing, and rehabilitative care, dietary and 
nutrition services, activities and social participation, and sanitation, 
infection control, and the physical environment;
    (3) An audit of written plans of care and residents' assessments to 
determine the accuracy of such assessments and the adequacy of such 
plans of care; and
    (4) A review of compliance with residents' rights requirements set 
forth in sections 1819(c) and 1919(c) of the Act.
    (b) The State survey agency's failure to follow the procedures set 
forth in this section will not invalidate otherwise legitimate 
determinations that a facility's deficiencies exist.



Sec.  488.307  Unannounced surveys.

    (a) Basic rule. All standard surveys must be unannounced.
    (b) Review of survey agency's scheduling and surveying procedures. 
(1) CMS reviews on an annual basis each State survey agency's scheduling 
and surveying procedures and practices to ensure that survey agencies 
avoid giving notice of a survey through the scheduling procedures and 
the conduct of the surveys.
    (2) CMS takes corrective action in accordance with the nature and 
complexity of the problem when survey agencies are found to have 
notified a SNF or NF through their scheduling or procedural policies. 
Sanctions for inadequate survey performance are in accordance with Sec.  
488.320.
    (c) Civil money penalties. An individual who notifies a SNF or NF, 
or causes a SNF or NF to be notified, of the time or date on which a 
standard survey is scheduled to be conducted is subject to a Federal 
civil money penalty not to exceed $2,000.



Sec.  488.308  Survey frequency.

    (a) Basic period. The survey agency must conduct a standard survey 
of each SNF and NF not later than 15 months after the last day of the 
previous standard survey.
    (b) Statewide average interval. (1) The statewide average interval 
between standard surveys must be 12 months or less, computed in 
accordance with paragraph (d) of this section.
    (2) CMS takes corrective action in accordance with the nature of the 
State survey agency's failure to ensure that the 12-month statewide 
average interval requirement is met. CMS's corrective action is in 
accordance with Sec.  488.320.
    (c) Other surveys. The survey agency may conduct a survey as 
frequently as necessary to--
    (1) Determine whether a facility complies with the participation 
requirements; and
    (2) Confirm that the facility has corrected deficiencies previously 
cited.
    (d) Computation of statewide average interval. The statewide average 
interval is computed at the end of each Federal fiscal year by comparing 
the last day of the most recent standard survey for each participating 
facility to the last day of each facility's previous standard survey.

[[Page 448]]

    (e) Special surveys. (1) The survey agency may conduct a standard or 
an abbreviated standard survey to determine whether certain changes have 
caused a decline in the quality of care furnished by a SNF or a NF, 
within 60 days of a change in the following:
    (i) Ownership;
    (ii) Entity responsible for management of a facility (management 
firm);
    (iii) Nursing home administrator; or
    (iv) Director of nursing.
    (2) The survey agency must review all complaint allegations and 
conduct a standard or an abbreviated standard survey to investigate 
complaints of violations of requirements by SNFs and NFs if its review 
of the allegation concludes that--
    (i) A deficiency in one or more of the requirements may have 
occurred; and
    (ii) Only a survey can determine whether a deficiency or 
deficiencies exist.
    (3) The survey agency does not conduct a survey if the complaint 
raises issues that are outside the purview of Federal participation 
requirements.



Sec.  488.310  Extended survey.

    (a) Purpose of survey. The purpose of an extended survey is to 
identify the policies and procedures that caused the facility to furnish 
substandard quality of care.
    (b) Scope of extended survey. An extended survey includes all of the 
following:
    (1) Review of a larger sample of resident assessments than the 
sample used in a standard survey.
    (2) Review of the staffing and in-service training.
    (3) If appropriate, examination of the contracts with consultants.
    (4) A review of the policies and procedures related to the 
requirements for which deficiencies exist.
    (5) Investigation of any participation requirement at the discretion 
of the survey agency.
    (c) Timing and basis for survey. The survey agency must conduct an 
extended survey not later than 14 calendar days after completion of a 
standard survey which found that the facility had furnished substandard 
quality of care.



Sec.  488.312  Consistency of survey results.

    CMS does and the survey agency must implement programs to measure 
accuracy and improve consistency in the application of survey results 
and enforcement remedies.



Sec.  488.314  Survey teams.

    (a) Team composition. (1) Surveys must be conducted by an 
interdisciplinary team of professionals, which must include a registered 
nurse.
    (2) Examples of professionals include, but are not limited to, 
physicians, physician assistants, nurse practitioners, physical, speech, 
or occupational therapists, registered professional nurses, dieticians, 
sanitarians, engineers, licensed practical nurses, or social workers.
    (3) The State determines what constitutes a professional, subject to 
CMS approval.
    (4) Any of the following circumstances disqualifies a surveyor for 
surveying a particular facility:
    (i) The surveyor currently works, or, within the past two years, has 
worked as an employee, as employment agency staff at the facility, or as 
an officer, consultant, or agent for the facility to be surveyed.
    (ii) The surveyor has any financial interest or any ownership 
interest in the facility.
    (iii) The surveyor has an immediate family member who has a 
relationship with a facility described in paragraphs (a)(4)(i) or 
paragraph (a)(4)(ii) of this section.
    (iv) The surveyor has an immediate family member who is a resident 
in the facility to be surveyed. For purposes of this section, an 
immediate family member is defined at Sec.  488.301 of this part.
    (b) CMS training. CMS provides comprehensive training to surveyors, 
including at least the following:
    (1) Application and interpretation of regulations for SNFs and NFs.
    (2) Techniques and survey procedures for conducting standard and 
extended surveys.
    (3) Techniques for auditing resident assessments and plans of care.
    (c) Required surveyor training. (1) Except as specified in paragraph 
(c)(3) of

[[Page 449]]

this section, the survey agency may not permit an individual to serve as 
a member of a survey team unless the individual has successfully 
completed a training and testing program prescribed by the Secretary.
    (2) The survey agency must have a mechanism to identify and respond 
to in-service training needs of the surveyors.
    (3) The survey agency may permit an individual who has not completed 
a training program to participate in a survey as a trainee if 
accompanied on-site by a surveyor who has successfully completed the 
required training and testing program.

[59 FR 56238, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.318  Inadequate survey performance.

    (a) CMS considers survey performance to be inadequate if the State 
survey agency--
    (1) Indicates a pattern of failure to--
    (i) Identify deficiencies and the failure cannot be explained by 
changed conditions in the facility or other case specific factors;
    (ii) Cite only valid deficiencies;
    (iii) Conduct surveys in accordance with the requirements of this 
subpart; or
    (iv) Use Federal standards, protocols, and the forms, methods and 
procedures specified by CMS in manual instructions; or
    (2) Fails to identify an immediate jeopardy situation.
    (b) Inadequate survey performance does not--
    (1) Relieve a SNF or NF of its obligation to meet all requirements 
for program participation; or
    (2) Invalidate adequately documented deficiencies.



Sec.  488.320  Sanctions for inadequate survey performance.

    (a) Annual assessment of survey performance. CMS assesses the 
performance of the State's survey and certification program annually.
    (b) Sanctions for inadequate survey performance. When a State 
demonstrates inadequate survey performance, as specified in Sec.  
488.318, CMS notifies the survey agency of the inadequacy and takes 
action in accordance with paragraphs (c) and (d) of this section.
    (c) Medicaid facilities. (1) For a pattern of failure to identify 
deficiencies in Medicaid facilities, CMS--
    (i) Reduces FFP, as specified in paragraph (e) of this section, and 
if appropriate;
    (ii) Provides for training of survey teams.
    (2) For other survey inadequacies in Medicaid facilities, CMS 
provides for training of survey teams.
    (d) Medicare facilities. For all survey inadequacies in Medicare 
facilities, CMS--
    (1) Requires that the State survey agency submit a plan of 
correction;
    (2) Provides for training of survey teams;
    (3) Provides technical assistance on scheduling and procedural 
policies;
    (4) Provides CMS-directed scheduling; or
    (5) Initiates action to terminate the agreement between the 
Secretary and the State under section 1864 of the Act, either in whole 
or in part.
    (e) Reduction of FFP. In reducing FFP for inadequate survey 
performance, CMS uses the formula specified in section 1919(g)(3)(C) of 
the Act, that is 33 percent multiplied by a fraction--
    (1) The numerator of which is equal to the total number of residents 
in the NFs that CMS found to be noncompliant during validation surveys 
for that quarter; and
    (2) The denominator of which is equal to the total number of 
residents in the NFs in which CMS conducted validation surveys during 
that quarter.
    (f) Appeal of FFP reduction. When a State is dissatisfied with CMS's 
determination to reduce FFP, the State may appeal the determination to 
the Departmental Appeals Board, using the procedures specified in 45 CFR 
part 16.



Sec.  488.325  Disclosure of results of surveys and activities.

    (a) Information which must be provided to public. As provided in 
sections 1819(g)(5) and 1919(g)(5) of the Act, the following information 
must be made available to the public, upon the public's request, by the 
State or CMS for all surveys and certifications of SNFs and NFs:

[[Page 450]]

    (1) Statements of deficiencies and providers' comments.
    (2) A list of isolated deficiencies that constitute no actual harm, 
with the potential for minimal harm.
    (3) Approved plans of correction.
    (4) Statements that the facility did not submit an acceptable plan 
of correction or failed to comply with the conditions of imposed 
remedies.
    (5) Final appeal results.
    (6) Notice of termination of a facility.
    (7) Medicare and Medicaid cost reports.
    (8) Names of individuals with direct or indirect ownership interest 
in a SNF or NF, as defined in Sec.  420.201 of this chapter.
    (9) Names of individuals with direct or indirect ownership interest 
in a SNF or NF, as defined in Sec.  420.201 of this chapter, who have 
been found guilty by a court of law of a criminal offense in violation 
of Medicare or Medicaid law.
    (b) Charge to public for information. CMS and the State may charge 
the public for specified services with respect to requests for 
information in accordance with--
    (1) Section 401.140 of this chapter, for Medicare; or
    (2) State procedures, for Medicaid.
    (c) How public can request information. The public may request 
information in accordance with disclosure procedures specified in 45 CFR 
part 5.
    (d) When information must be disclosed. The disclosing agency must 
make available to the public, upon the public's request, information 
concerning all surveys and certifications of SNFs and NFs, including 
statements of deficiencies, separate listings of any isolated 
deficiencies that constitute no actual harm, with the potential for 
minimal harm, and plans of correction (which contain any provider 
response to the deficiency statement) within 14 calendar days after each 
item is made available to the facility.
    (e) Procedures for responding to requests. The procedures and time 
periods for responding to requests are in accordance with--
    (1) Section 401.136 of this chapter for documents maintained by CMS; 
and
    (2) State procedures for documents maintained by the State.
    (f) Information that must be provided to the State's long-term care 
ombudsman. The State must provide the State's long-term care ombudsman 
with the following:
    (1) A statement of deficiencies reflecting facility noncompliance, 
including a separate list of isolated deficiencies that constitute no 
harm with the potential for minimal harm.
    (2) Reports of adverse actions specified at Sec.  488.406 imposed on 
a facility.
    (3) Written response by the provider.
    (4) A provider's request for an appeal and the results of any 
appeal.
    (g) Information which must be provided to State by a facility with 
substandard quality of care. (1) To provide for the notice to physicians 
required under sections 1819(g)(5)(C) and 1919(g)(5)(C) of the Act, not 
later than 10 working days after receiving a notice of substandard 
quality of care, a SNF or NF must provide the State with a list of--
    (i) Each resident in the facility with respect to which such finding 
was made; and
    (ii) The name and address of his or her attending physician.
    (2) Failure to disclose the information timely will result in 
termination of participation or imposition of alternative remedies.
    (h) Information the State must provide to attending physician and 
State board. Not later than 20 calendar days after a SNF or NF complies 
with paragraph (g) of this section, the State must provide written 
notice of the noncompliance to--
    (1) The attending physician of each resident in the facility with 
respect to which a finding of substandard quality of care was made; and
    (2) The State board responsible for licensing the facility's 
administrator.
    (i) Access to information by State Medicaid fraud control unit. The 
State must provide access to any survey and certification information 
incidental to a SNF's or NF's participation in Medicare or Medicaid upon 
written request by the State Medicaid fraud control unit established 
under part 1007, of this title, consistent with current State laws.

[59 FR 56238, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]

[[Page 451]]



Sec.  488.330  Certification of compliance or noncompliance.

    (a) General rules--(1) Responsibility for certification. (i) The 
State survey agency surveys all facilities for compliance or 
noncompliance with requirements for long term care facilities. The 
survey by the State survey agency may be followed by a Federal 
validation survey.
    (A) The State certifies the compliance or noncompliance of non-State 
operated NFs. Regardless of the State entity doing the certification, it 
is final, except in the case of a complaint or validation survey 
conducted by CMS, or CMS review of the State's findings.
    (B) CMS certifies the compliance or noncompliance of all State-
operated facilities.
    (C) The State survey agency certifies the compliance or 
noncompliance of a non-State operated SNF, subject to the approval of 
CMS.
    (D) The State survey agency certifies compliance or noncompliance 
for a dually participating SNF/NF. In the case of a disagreement between 
CMS and the State survey agency, a finding of noncompliance takes 
precedence over that of compliance.
    (ii) In the case of a validation survey, the Secretary's 
determination as to the facility's noncompliance is binding, and takes 
precedence over a certification of compliance resulting from the State 
survey.
    (2) Basis for certification. (i) Certification by the State is based 
on the survey agency findings.
    (ii) Certification by CMS is based on either the survey agency 
findings (in the case of State-operated facilities), or, in the case of 
a validation survey, on CMS's own survey findings.
    (b) Effect of certification--(1) Certification of compliance. A 
certification of compliance constitutes a determination that the 
facility is in substantial compliance and is eligible to participate in 
Medicaid as a NF, or in Medicare as a SNF, or in Medicare and Medicaid 
as a dually participating facility.
    (2) Certification of noncompliance. A certification of noncompliance 
requires denial of participation for prospective providers and 
enforcement action for current providers in accordance with subpart F of 
this part. Enforcement action must include one of the following:
    (i) Termination of any Medicare or Medicaid provider agreements that 
are in effect.
    (ii) Application of alternative remedies instead of, or in addition 
to, termination procedures.
    (c) Notice of certification of noncompliance and resulting action. 
The notice of certification of noncompliance is sent in accordance with 
the timeframes specified in Sec.  488.402(f), and resulting action is 
issued by CMS, except when the State is taking the action for a non-
State operated NF.
    (d) Content of notice of certification of noncompliance. The notice 
of certification of noncompliance is sent in accordance with the 
timeframes specified in Sec.  488.402(f) and includes information on all 
of the following:
    (1) Nature of noncompliance.
    (2) Any alternative remedies to be imposed under subpart F of this 
part.
    (3) Any termination or denial of participation action to be taken 
under this part.
    (4) The appeal rights available to the facility under this part.
    (5) Timeframes to be met by the provider and certifying agency with 
regard to each of the enforcement actions or appeal procedures addressed 
in the notice.
    (e) Appeals. (1) Notwithstanding any provision of State law, the 
State must impose remedies promptly on any provider of services 
participating in the Medicaid program--
    (i) After promptly notifying the facility of the deficiencies and 
impending remedy or remedies; and
    (ii) Except for civil money penalties, during any pending hearing 
that may be requested by the provider of services.
    (2) CMS imposes remedies promptly on any provider of services 
participating in the Medicare or Medicaid program or any provider of 
services participating in both the Medicare and Medicaid programs--
    (i) After promptly notifying the facility of the deficiencies and 
impending remedy or remedies; and
    (ii) Except for civil money penalties, during any pending hearing 
that may

[[Page 452]]

be requested by the provider of services.
    (3) The provisions of part 498 of this chapter apply when the 
following providers request a hearing on a denial of participation, or 
certification of noncompliance leading to an enforcement remedy 
(including termination of the provider agreement), except State 
monitoring:
    (i) All State-operated facilities;
    (ii) SNFs and dually participating SNF/NFs; and
    (iii) Any other facilities subject to a CMS validation survey or CMS 
review of the State's findings.
    (4) The provisions of part 431 of this chapter apply when a non-
State operated Medicaid NF, which has not received a CMS validation 
survey or CMS review of the State's findings, requests a hearing on the 
State's denial of participation, termination of provider agreement, or 
certification of noncompliance leading to an alternative remedy, except 
State monitoring.
    (f) Provider agreements. CMS or the Medicaid agency may execute a 
provider agreement when a prospective provider is in substantial 
compliance with all the requirements for participation for a SNF or NF, 
respectively.
    (g) Special rules for Federal validation surveys. (1) CMS may make 
independent certifications of a NF's, SNF's, or dually participating 
facility's noncompliance based on a CMS validation survey.
    (2) CMS issues the notice of actions affecting facilities for which 
CMS did validation surveys.
    (3) For non-State-operated NFs and non-State-operated dually 
participating facilities, any disagreement between CMS and the State 
regarding the timing and choice of remedies is resolved in accordance 
with Sec.  488.452.
    (4) Either CMS or the survey agency, at CMS's option, may revisit 
the facility to ensure that corrections are made.

[59 FR 56238, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.331  Informal dispute resolution.

    (a) Opportunity to refute survey findings. (1) For non-Federal 
surveys, the State must offer a facility an informal opportunity, at the 
facility's request, to dispute survey findings upon the facility's 
receipt of the official statement of deficiencies.
    (2) For Federal surveys, CMS offers a facility an informal 
opportunity, at the facility's request, to dispute survey findings upon 
the facility's receipt of the official statement of deficiencies.
    (b)(1) Failure of the State or CMS, as appropriate, to complete 
informal dispute resolution timely cannot delay the effective date of 
any enforcement action against the facility.
    (2) A facility may not seek a delay of any enforcement action 
against it on the grounds that informal dispute resolution has not been 
completed before the effective date of the enforcement action.
    (c) If a provider is subsequently successful, during the informal 
dispute resolution process, at demonstrating that deficiencies should 
not have been cited, the deficiencies are removed from the statement of 
deficiencies and any enforcement actions imposed solely as a result of 
those cited deficiencies are rescinded.
    (d) Notification. Upon request, CMS does and the State must provide 
the facility with written notification of the informal dispute 
resolution process.



Sec.  488.332  Investigation of complaints of violations and monitoring of compliance.

    (a) Investigation of complaints. (1) The State survey agency must 
establish procedures and maintain adequate staff to investigate 
complaints of violations of participation requirements.
    (2) The State survey agency takes appropriate precautions to protect 
a complainant's anonymity and privacy, if possible.
    (3) If arrangements have been made with other State components for 
investigation of complaints, the State must have a means of 
communicating information among appropriate entities, and the State 
survey agency retains responsibility for the investigation process.
    (4) If, after investigating a complaint, the State has reason to 
believe that an identifiable individual neglected or abused a resident, 
or misappropriated a resident's property, the

[[Page 453]]

State survey agency must act on the complaint in accordance with Sec.  
488.335.
    (b) On-site monitoring. The State survey agency conducts on-site 
monitoring on an as necessary basis when--
    (1) A facility is not in substantial compliance with the 
requirements and is in the process of correcting deficiencies;
    (2) A facility has corrected deficiencies and verification of 
continued substantial compliance is needed; or
    (3) The survey agency has reason to question the substantial 
compliance of the facility with a requirement of participation.
    (c) Composition of the investigative team. A State may use a 
specialized team, which may include an attorney, auditor and appropriate 
health professionals, to identify, survey, gather and preserve evidence, 
and administer remedies to noncompliant facilities.



Sec.  488.334  Educational programs.

    A State must conduct periodic educational programs for the staff and 
residents (and their representatives) of SNFs and NFs in order to 
present current regulations, procedures, and policies on the survey, 
certification and enforcement process under this subpart and subpart F 
of this part.



Sec.  488.335  Action on complaints of resident neglect and abuse, and misappropriation of resident property.

    (a) Investigation. (1) The State must review all allegations of 
resident neglect and abuse, and misappropriation of resident property 
and follow procedures specified in Sec.  488.332.
    (2) If there is reason to believe, either through oral or written 
evidence that an individual used by a facility to provide services to 
residents could have abused or neglected a resident or misappropriated a 
resident's property, the State must investigate the allegation.
    (3) The State must have written procedures for the timely review and 
investigation of allegations of resident abuse and neglect, and 
misappropriation of resident property.
    (b) Source of complaints. The State must review all allegations 
regardless of the source.
    (c) Notification--(1) Individuals to be notified. If the State makes 
a preliminary determination, based on oral or written evidence and its 
investigation, that the abuse, neglect or misappropriation of property 
occurred, it must notify in writing--
    (i) The individuals implicated in the investigation; and
    (ii) The current administrator of the facility in which the incident 
occurred.
    (2) Timing of the notice. The State must notify the individuals 
specified in paragraph (c)(1) of this section in writing within 10 
working days of the State's investigation.
    (3) Contents of the notice. The notice must include the--
    (i) Nature of the allegation(s);
    (ii) Date and time of the occurrence;
    (iii) Right to a hearing;
    (iv) Intent to report the substantiated findings in writing, once 
the individual has had the opportunity for a hearing, to the nurse aide 
registry or appropriate licensure authority;
    (v) Fact that the individual's failure to request a hearing in 
writing within 30 days from the date of the notice will result in 
reporting the substantiated findings to the nurse aide registry or 
appropriate licensure authority.
    (vi) Consequences of waiving the right to a hearing;
    (vii) Consequences of a finding through the hearing process that the 
alleged resident abuse or neglect, or misappropriation of resident 
property did occur; and
    (viii) Fact that the individual has the right to be represented by 
an attorney at the individual's own expense.
    (d) Conduct of hearing. (1) The State must complete the hearing and 
the hearing record within 120 days from the day it receives the request 
for a hearing.
    (2) The State must hold the hearing at a reasonable place and time 
convenient for the individual.
    (e) Factors beyond the individual's control. A State must not make a 
finding that an individual has neglected a resident if the individual 
demonstrates that such neglect was caused by factors beyond the control 
of the individual.
    (f) Report of findings. If the finding is that the individual has 
neglected or abused a resident or misappropriated resident property or 
if the individual waives the right to a hearing, the State

[[Page 454]]

must report the findings in writing within 10 working days to--
    (1) The individual;
    (2) The current administrator of the facility in which the incident 
occurred; and
    (3) The administrator of the facility that currently employs the 
individual, if different than the facility in which the incident 
occurred;
    (4) The licensing authority for individuals used by the facility 
other than nurse aides, if applicable; and
    (5) The nurse aide registry for nurse aides. Only the State survey 
agency may report the findings to the nurse aide registry, and this must 
be done within 10 working days of the findings, in accordance with Sec.  
483.156(c) of this chapter. The State survey agency may not delegate 
this responsibility.
    (g) Contents and retention of report of finding to the nurse aide 
registry. (1) The report of finding must include information in 
accordance with Sec.  483.156(c) of this chapter.
    (2) The survey agency must retain the information as specified in 
paragraph (g)(1) of this section, in accordance with the procedures 
specified in Sec.  483.156(c) of this chapter.
    (h) Survey agency responsibility. (1) The survey agency must 
promptly review the results of all complaint investigations and 
determine whether or not a facility has violated any requirements in 
part 483, subpart B of this chapter.
    (2) If a facility is not in substantial compliance with the 
requirements in part 483, subpart B of this chapter, the survey agency 
initiates appropriate actions, as specified in subpart F of this part.

[59 FR 56238, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



 Subpart F_Enforcement of Compliance for Long-Term Care Facilities with 
                              Deficiencies

    Source: 59 FR 56243, Nov. 10, 1994, unless otherwise noted.



Sec.  488.400  Statutory basis.

    Sections 1819(h) and 1919(h) of the Act specify remedies that may be 
used by the Secretary or the State respectively when a SNF or a NF is 
not in substantial compliance with the requirements for participation in 
the Medicare and Medicaid programs. These sections also provide for 
ensuring prompt compliance and specify that these remedies are in 
addition to any others available under State or Federal law, and, except 
for civil money penalties, are imposed prior to the conduct of a 
hearing.



Sec.  488.401  Definitions.

    As used in this subpart--
    New admission means a resident who is admitted to the facility on or 
after the effective date of a denial of payment remedy and, if 
previously admitted, has been discharged before that effective date. 
Residents admitted before the effective date of the denial of payment, 
and taking temporary leave, are not considered new admissions, nor 
subject to the denial of payment.
    Plan of correction means a plan developed by the facility and 
approved by CMS or the survey agency that describes the actions the 
facility will take to correct deficiencies and specifies the date by 
which those deficiencies will be corrected.

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.402  General provisions.

    (a) Purpose of remedies. The purpose of remedies is to ensure prompt 
compliance with program requirements.
    (b) Basis for imposition and duration of remedies. When CMS or the 
State chooses to apply one or more remedies specified in Sec.  488.406, 
the remedies are applied on the basis of noncompliance found during 
surveys conducted by CMS or by the survey agency.
    (c) Number of remedies. CMS or the State may apply one or more 
remedies for each deficiency constituting noncompliance or for all 
deficiencies constituting noncompliance.
    (d) Plan of correction requirement. (1) Except as specified in 
paragraph (d)(2) of this section, regardless of which remedy is applied, 
each facility that has deficiencies with respect to program requirements 
must submit a plan of correction for approval by CMS or the survey 
agency.

[[Page 455]]

    (2) Isolated deficiencies. A facility is not required to submit a 
plan of correction when it has deficiencies that are isolated and have a 
potential for minimal harm, but no actual harm has occurred.
    (e) Disagreement regarding remedies. If the State and CMS disagree 
on the decision to impose a remedy, the disagreement is resolved in 
accordance with Sec.  488.452.
    (f) Notification requirements--(1) Except when the State is taking 
action against a non-State operated NF, CMS or the State (as authorized 
by CMS) gives the provider notice of the remedy, including the--
    (i) Nature of the noncompliance;
    (ii) Which remedy is imposed;
    (iii) Effective date of the remedy; and
    (iv) Right to appeal the determination leading to the remedy.
    (2) When a State is taking action against a non-State operated NF, 
the State's notice must include the same information required by CMS in 
paragraph (f)(1) of this section.
    (3) Immediate jeopardy--2 day notice. Except for civil money 
penalties and State monitoring imposed when there is immediate jeopardy, 
for all remedies specified in Sec.  488.406 imposed when there is 
immediate jeopardy, the notice must be given at least 2 calendar days 
before the effective date of the enforcement action.
    (4) No immediate jeopardy--15 day notice. Except for civil money 
penalties and State monitoring, notice must be given at least 15 
calendar days before the effective date of the enforcement action in 
situations in which there is no immediate jeopardy.
    (5) Date of enforcement action. The 2-and 15-day notice periods 
begin when the facility receives the notice.
    (6) Civil money penalties. For civil money penalties, the notices 
must be given in accordance with the provisions of Sec. Sec.  488.434 
and 488.440.
    (7) State monitoring. For State monitoring, no prior notice is 
required.

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995, as amended at 
64 FR 13360, Mar. 18, 1999]



Sec.  488.404  Factors to be considered in selecting remedies.

    (a) Initial assessment. In order to select the appropriate remedy, 
if any, to apply to a facility with deficiencies, CMS and the State 
determine the seriousness of the deficiencies.
    (b) Determining seriousness of deficiencies. To determine the 
seriousness of the deficiency, CMS considers and the State must consider 
at least the following factors:
    (1) Whether a facility's deficiencies constitute--
    (i) No actual harm with a potential for minimal harm;
    (ii) No actual harm with a potential for more than minimal harm, but 
not immediate jeopardy;
    (iii) Actual harm that is not immediate jeopardy; or
    (iv) Immediate jeopardy to resident health or safety.
    (2) Whether the deficiencies--
    (i) Are isolated;
    (ii) Constitute a pattern; or
    (iii) Are widespread.
    (c) Other factors which may be considered in choosing a remedy 
within a remedy category. Following the initial assessment, CMS and the 
State may consider other factors, which may include, but are not limited 
to the following:
    (1) The relationship of the one deficiency to other deficiencies 
resulting in noncompliance.
    (2) The facility's prior history of noncompliance in general and 
specifically with reference to the cited deficiencies.



Sec.  488.406  Available remedies.

    (a) General. In addition to the remedy of termination of the 
provider agreement, the following remedies are available:
    (1) Temporary management.
    (2) Denial of payment including--
    (i) Denial of payment for all individuals, imposed by CMS, to a--
    (A) Skilled nursing facility, for Medicare;
    (B) State, for Medicaid; or
    (ii) Denial of payment for all new admissions.
    (3) Civil money penalties.
    (4) State monitoring.
    (5) Transfer of residents.
    (6) Closure of the facility and transfer of residents.

[[Page 456]]

    (7) Directed plan of correction.
    (8) Directed in-service training.
    (9) Alternative or additional State remedies approved by CMS.
    (b) Remedies that must be established. At a minimum, and in addition 
to termination of the provider agreement, the State must establish the 
following remedies or approved alternatives to the following remedies:
    (1) Temporary management.
    (2) Denial of payment for new admissions.
    (3) Civil money penalties.
    (4) Transfer of residents.
    (5) Closure of the facility and transfer of residents.
    (6) State monitoring.
    (c) State plan requirement. If a State wishes to use remedies for 
noncompliance that are either additional or alternative to those 
specified in paragraphs (a) or (b) of this section, it must--
    (1) Specify those remedies in the State plan; and
    (2) Demonstrate to CMS's satisfaction that those remedies are as 
effective as the remedies listed in paragraph (a) of this section, for 
deterring noncompliance and correcting deficiencies.
    (d) State remedies in dually participating facilities. If the 
State's remedy is unique to the State plan and has been approved by CMS, 
then that remedy, as imposed by the State under its Medicaid authority, 
may be imposed by CMS against the Medicare provider agreement of a 
dually participating facility.

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.408  Selection of remedies.

    (a) Categories of remedies. In this section, the remedies specified 
in Sec.  488.406(a) are grouped into categories and applied to 
deficiencies according to how serious the noncompliance is.
    (b) Application of remedies. After considering the factors specified 
in Sec.  488.404, as applicable, if CMS and the State choose to impose 
remedies, as provided in paragraphs (c)(1), (d)(1) and (e)(1) of this 
section, for facility noncompliance, instead of, or in addition to, 
termination of the provider agreement, CMS does and the State must 
follow the criteria set forth in paragraphs (c)(2), (d)(2), and (e)(2) 
of this section, as applicable.
    (c) Category 1. (1) Category 1 remedies include the following:
    (i) Directed plan of correction.
    (ii) State monitoring.
    (iii) Directed in-service training.
    (2) CMS does or the State must apply one or more of the remedies in 
Category 1 when there--
    (i) Are isolated deficiencies that constitute no actual harm with a 
potential for more than minimal harm but not immediate jeopardy; or
    (ii) Is a pattern of deficiencies that constitutes no actual harm 
with a potential for more than minimal harm but not immediate jeopardy.
    (3) Except when the facility is in substantial compliance, CMS or 
the State may apply one or more of the remedies in Category 1 to any 
deficiency.
    (d) Category 2. (1) Category 2 remedies include the following:
    (i) Denial of payment for new admissions.
    (ii) Denial of payment for all individuals imposed only by CMS.
    (iii) Civil money penalties of $50-3,000 per day.
    (iv) Civil money penalty of $1,000-$10,000 per instance of 
noncompliance.
    (2) CMS applies one or more of the remedies in Category 2, or, 
except for denial of payment for all individuals, the State must apply 
one or more of the remedies in Category 2 when there are--
    (i) Widespread deficiencies that constitute no actual harm with a 
potential for more than minimal harm but not immediate jeopardy; or
    (ii) One or more deficiencies that constitute actual harm that is 
not immediate jeopardy.
    (3) CMS or the State may apply one or more of the remedies in 
Category 2 to any deficiency except when--
    (i) The facility is in substantial compliance; or
    (ii) CMS or the State imposes a civil money penalty for a deficiency 
that constitutes immediate jeopardy, the penalty must be in the upper 
range of penalty amounts, as specified in Sec.  488.438(a).
    (e) Category 3. (1) Category 3 remedies include the following:
    (i) Temporary management.

[[Page 457]]

    (ii) Immediate termination.
    (iii) Civil money penalties of $3,050-$10,000 per day.
    (iv) Civil money penalty of $1,000-$10,000 per instance of 
noncompliance.
    (2) When there are one or more deficiencies that constitute 
immediate jeopardy to resident health or safety--
    (i) CMS does and the State must do one or both of the following:
    (A) Impose temporary management; or
    (B) Terminate the provider agreement;
    (ii) CMS and the State may impose a civil money penalty of $3,050-
$10,000 per day or $1,000-$10,000 per instance of noncompliance, in 
addition to imposing the remedies specified in paragraph (e)(2)(i) of 
this section.
    (3) When there are widespread deficiencies that constitute actual 
harm that is not immediate jeopardy, CMS and the State may impose 
temporary management, in addition to Category 2 remedies.
    (f) Plan of correction. (1) Except as specified in paragraph (f)(2) 
of this section, each facility that has a deficiency with regard to a 
requirement for long term care facilities must submit a plan of 
correction for approval by CMS or the State, regardless of--
    (i) Which remedies are imposed; or
    (ii) The seriousness of the deficiencies.
    (2) When there are only isolated deficiencies that CMS or the State 
determines constitute no actual harm with a potential for minimal harm, 
the facility need not submit a plan of correction.
    (g) Appeal of a certification of noncompliance. (1) A facility may 
appeal a certification of noncompliance leading to an enforcement 
remedy.
    (2) A facility may not appeal the choice of remedy, including the 
factors considered by CMS or the State in selecting the remedy, 
specified in Sec.  488.404.

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995, as amended at 
64 FR 13360, Mar. 18, 1999]



Sec.  488.410  Action when there is immediate jeopardy.

    (a) If there is immediate jeopardy to resident health or safety, the 
State must (and CMS does) either terminate the provider agreement within 
23 calendar days of the last date of the survey or appoint a temporary 
manager to remove the immediate jeopardy. The rules for appointment of a 
temporary manager in an immediate jeopardy situation are as follows:
    (1) CMS does and the State must notify the facility that a temporary 
manager is being appointed.
    (2) If the facility fails to relinquish control to the temporary 
manager, CMS does and the State must terminate the provider agreement 
within 23 calendar days of the last day of the survey, if the immediate 
jeopardy is not removed. In these cases, State monitoring may be imposed 
pending termination.
    (3) If the facility relinquishes control to the temporary manager, 
the State must (and CMS does) notify the facility that, unless it 
removes the immediate jeopardy, its provider agreement will be 
terminated within 23 calendar days of the last day of the survey.
    (4) CMS does and the State must terminate the provider agreement 
within 23 calendar days of the last day of survey if the immediate 
jeopardy has not been removed.
    (b) CMS or the State may also impose other remedies, as appropriate.
    (c)(1) In a NF or dually participating facility, if either CMS or 
the State finds that a facility's noncompliance poses immediate jeopardy 
to resident health or safety, CMS or the State must notify the other of 
such a finding.
    (2) CMS will or the State must do one or both of the following:
    (i) Take immediate action to remove the jeopardy and correct the 
noncompliance through temporary management.
    (ii) Terminate the facility's participation under the State plan. If 
this is done, CMS will also terminate the facility's participation in 
Medicare if it is a dually participating facility.
    (d) The State must provide for the safe and orderly transfer of 
residents when the facility is terminated.
    (e) If the immediate jeopardy is also substandard quality of care, 
the State survey agency must notify attending

[[Page 458]]

physicians and the State board responsible for licensing the facility 
administrator of the finding of substandard quality of care, as 
specified in Sec.  488.325(h).

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.412  Action when there is no immediate jeopardy.

    (a) If a facility's deficiencies do not pose immediate jeopardy to 
residents' health or safety, and the facility is not in substantial 
compliance, CMS or the State may terminate the facility's provider 
agreement or may allow the facility to continue to participate for no 
longer than 6 months from the last day of the survey if--
    (1) The State survey agency finds that it is more appropriate to 
impose alternative remedies than to terminate the facility's provider 
agreement;
    (2) The State has submitted a plan and timetable for corrective 
action approved by CMS; and
    (3) The facility in the case of a Medicare SNF or the State in the 
case of a Medicaid NF agrees to repay to the Federal government payments 
received after the last day of the survey that first identified the 
deficiencies if corrective action is not taken in accordance with the 
approved plan of correction.
    (b) If a facility does not meet the criteria for continuation of 
payment under paragraph (a) of this section, CMS will and the State must 
terminate the facility's provider agreement.
    (c) CMS does and the State must deny payment for new admissions when 
a facility is not in substantial compliance 3 months after the last day 
of the survey.
    (d) CMS terminates the provider agreement for SNFs and NFs, and 
stops FFP to a State for a NF for which participation was continued 
under paragraph (a) of this section, if the facility is not in 
substantial compliance within 6 months of the last day of the survey.

[59 FR 56243, Nov. 10, 1994; 60 FR 50118, Sept. 28, 1995]



Sec.  488.414  Action when there is repeated substandard quality of care.

    (a) General. If a facility has been found to have provided 
substandard quality of care on the last three consecutive standard 
surveys, as defined in Sec.  488.305, regardless of other remedies 
provided--
    (1) CMS imposes denial of payment for all new admissions, as 
specified in Sec.  488.417, or denial of all payments, as specified in 
Sec.  488.418;
    (2) The State must impose denial of payment for all new admissions, 
as specified in Sec.  488.417; and
    (3) CMS does and the State survey agency must impose State 
monitoring, as specified in Sec.  488.422, until the facility has 
demonstrated to the satisfaction of CMS or the State, that it is in 
substantial compliance with all requirements and will remain in 
substantial compliance with all requirements.
    (b) Repeated noncompliance. For purposes of this section, repeated 
noncompliance is based on the repeated finding of substandard quality of 
care and not on the basis that the substance of the deficiency or the 
exact tag number for the deficiency was repeated.
    (c) Standard surveys to which this provision applies. Standard 
surveys completed by the State survey agency on or after October 1, 
1990, are used to determine whether the threshold of three consecutive 
standard surveys is met.
    (d) Program participation. (1) The determination that a certified 
facility has repeated instances of substandard quality of care is made 
without regard to any variances in the facility's program participation 
(that is, any standard survey completed for Medicare, Medicaid or both 
programs will be considered).
    (2) Termination would allow the count of repeated substandard 
quality of care surveys to start over.
    (3) Change of ownership. (i) A facility may not avoid a remedy on 
the basis that it underwent a change of ownership.
    (ii) In a facility that has undergone a change of ownership, CMS 
does not and the State may not restart the count of repeated substandard 
quality of care surveys unless the new owner can demonstrate to the 
satisfaction of CMS or the State that the poor past performance no 
longer is a factor due to the change in ownership.

[[Page 459]]

    (e) Facility alleges corrections or achieves compliance after 
repeated substandard quality of care is identified. (1) If a penalty is 
imposed for repeated substandard quality of care, it will continue until 
the facility has demonstrated to the satisfaction of CMS or the State 
that it is in substantial compliance with the requirements and that it 
will remain in substantial compliance with the requirements for a period 
of time specified by CMS or the State.
    (2) A facility will not avoid the imposition of remedies or the 
obligation to demonstrate that it will remain in compliance when it--
    (i) Alleges correction of the deficiencies cited in the most recent 
standard survey; or
    (ii) Achieves compliance before the effective date of the remedies.



Sec.  488.415  Temporary management.

    (a) Definition. Temporary management means the temporary appointment 
by CMS or the State of a substitute facility manager or administrator 
with authority to hire, terminate or reassign staff, obligate facility 
funds, alter facility procedures, and manage the facility to correct 
deficiencies identified in the facility's operation.
    (b) Qualifications. The temporary manager must--
    (1) Be qualified to oversee correction of deficiencies on the basis 
of experience and education, as determined by the State;
    (2) Not have been found guilty of misconduct by any licensing board 
or professional society in any State;
    (3) Have, or a member of his or her immediate family have, no 
financial ownership interest in the facility; and
    (4) Not currently serve or, within the past 2 years, have served as 
a member of the staff of the facility.
    (c) Payment of salary. The temporary manager's salary--
    (1) Is paid directly by the facility while the temporary manager is 
assigned to that facility; and
    (2) Must be at least equivalent to the sum of the following--
    (i) The prevailing salary paid by providers for positions of this 
type in what the State considers to be the facility's geographic area;
    (ii) Additional costs that would have reasonably been incurred by 
the provider if such person had been in an employment relationship; and
    (iii) Any other costs incurred by such a person in furnishing 
services under such an arrangement or as otherwise set by the State.
    (3) May exceed the amount specified in paragraph (c)(2) of this 
section if the State is otherwise unable to attract a qualified 
temporary manager.
    (d) Failure to relinquish authority to temporary management--(1) 
Termination of provider agreement. If a facility fails to relinquish 
authority to the temporary manager as described in this section, CMS 
will or the State must terminate the provider agreement in accordance 
with Sec.  488.456.
    (2) Failure to pay salary of temporary manager. A facility's failure 
to pay the salary of the temporary manager is considered a failure to 
relinquish authority to temporary management.
    (e) Duration of temporary management. Temporary management ends when 
the facility meets any of the conditions specified in Sec.  488.454(c).



Sec.  488.417  Denial of payment for all new admissions.

    (a) Optional denial of payment. Except as specified in paragraph (b) 
of this section, CMS or the State may deny payment for all new 
admissions when a facility is not in substantial compliance with the 
requirements, as defined in Sec.  488.401, as follows:
    (1) Medicare facilities. In the case of Medicare facilities, CMS may 
deny payment to the facility.
    (2) Medicaid facilities. In the case of Medicaid facilities--
    (i) The State may deny payment to the facility; and
    (ii) CMS may deny payment to the State for all new Medicaid 
admissions to the facility.
    (b) Required denial of payment. CMS does or the State must deny 
payment for all new admissions when--
    (1) The facility is not in substantial compliance, as defined in 
Sec.  488.401, 3 months after the last day of the survey identifying the 
noncompliance; or
    (2) The State survey agency has cited a facility with substandard 
quality of

[[Page 460]]

care on the last three consecutive standard surveys.
    (c) Resumption of payments: Repeated instances of substandard 
quality of care. When a facility has repeated instances of substandard 
quality of care, payments to the facility or, under Medicaid, CMS 
payments to the State on behalf of the facility, resume on the date 
that--
    (1) The facility achieves substantial compliance as indicated by a 
revisit or written credible evidence acceptable to CMS (for all 
facilities except non-State operated NFs against which CMS is imposing 
no remedies) or the State (for non-State operated NFs against which CMS 
is imposing no remedies); and
    (2) CMS (for all facilities except non-State operated NFs against 
which CMS is imposing no remedies) or the State (for non-State operated 
NFs against which CMS is imposing no remedies) believes that the 
facility is capable of remaining in substantial compliance.
    (d) Resumption of payments: No repeated instances of substandard 
quality of care. When a facility does not have repeated instances of 
substandard quality of care, payments to the facility or, under 
Medicaid, CMS payments to the State on behalf of the facility, resume 
prospectively on the date that the facility achieves substantial 
compliance, as indicated by a revisit or written credible evidence 
acceptable to CMS (under Medicare) or the State (under Medicaid).
    (e) Restriction. No payments to a facility or, under Medicaid, CMS 
payments to the State on behalf of the facility, are made for the period 
between the date that the--
    (1) Denial of payment remedy is imposed; and
    (2) Facility achieves substantial compliance, as determined by CMS 
or the State.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995]



Sec.  488.418  Secretarial authority to deny all payments.

    (a) CMS option to deny all payment. If a facility has not met a 
requirement, in addition to the authority to deny payment for all new 
admissions as specified in Sec.  488.417, CMS may deny any further 
payment for all Medicare residents in the facility and to the State for 
all Medicaid residents in the facility.
    (b) Prospective resumption of payment. Except as provided in 
paragraphs (d) and (e) of this section, if the facility achieves 
substantial compliance, CMS resumes payment prospectively from the date 
that it verifies as the date that the facility achieved substantial 
compliance.
    (c) Restriction on payment after denial of payment is imposed. If 
payment to the facility or to the State resumes after denial of payment 
for all residents, no payment is made for the period between the date 
that--
    (1) Denial of payment was imposed; and
    (2) CMS verifies as the date that the facility achieved substantial 
compliance.
    (d) Retroactive resumption of payment. Except when a facility has 
repeated instances of substandard quality of care, as specified in 
paragraph (e) of this section, when CMS or the State finds that the 
facility was in substantial compliance before the date of the revisit, 
or before CMS or the survey agency received credible evidence of such 
compliance, payment is resumed on the date that substantial compliance 
was achieved, as determined by CMS.
    (e) Resumption of payment--repeated instances of substandard care. 
When CMS denies payment for all Medicare residents for repeated 
instances of substandard quality of care, payment is resumed when--
    (1) The facility achieved substantial compliance, as indicated by a 
revisit or written credible evidence acceptable to CMS; and
    (2) CMS believes that the facility will remain in substantial 
compliance.



Sec.  488.422  State monitoring.

    (a) A State monitor--
    (1) Oversees the correction of deficiencies specified by CMS or the 
State survey agency at the facility site and protects the facility's 
residents from harm;
    (2) Is an employee or a contractor of the survey agency;
    (3) Is identified by the State as an appropriate professional to 
monitor cited deficiencies;

[[Page 461]]

    (4) Is not an employee of the facility;
    (5) Does not function as a consultant to the facility; and
    (6) Does not have an immediate family member who is a resident of 
the facility to be monitored.
    (b) A State monitor must be used when a survey agency has cited a 
facility with substandard quality of care deficiencies on the last 3 
consecutive standard surveys.
    (c) State monitoring is discontinued when--
    (1) The facility has demonstrated that it is in substantial 
compliance with the requirements, and, if imposed for repeated instances 
of substandard quality of care, will remain in compliance for a period 
of time specified by CMS or the State; or
    (2) Termination procedures are completed.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995]



Sec.  488.424  Directed plan of correction.

    CMS, the State survey agency, or the temporary manager (with CMS or 
State approval) may develop a plan of correction and CMS, the State, or 
the temporary manager require a facility to take action within specified 
timeframes.



Sec.  488.425  Directed inservice training.

    (a) Required training. CMS or the State agency may require the staff 
of a facility to attend an inservice training program if--
    (1) The facility has a pattern of deficiencies that indicate 
noncompliance; and
    (2) Education is likely to correct the deficiencies.
    (b) Action following training. After the staff has received 
inservice training, if the facility has not achieved substantial 
compliance, CMS or the State may impose one or more other remedies 
specified in Sec.  488.406.
    (c) Payment. The facility pays for directed inservice training.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995]



Sec.  488.426  Transfer of residents, or closure of the facility and transfer of residents.

    (a) Transfer of residents, or closure of the facility and transfer 
of residents in an emergency. In an emergency, the State has the 
authority to--
    (1) Transfer Medicaid and Medicare residents to another facility; or
    (2) Close the facility and transfer the Medicaid and Medicare 
residents to another facility.
    (b) Required transfer when a facility's provider agreement is 
terminated. When the State or CMS terminates a facility's provider 
agreement, the State arranges for the safe and orderly transfer of all 
Medicare and Medicaid residents to another facility.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995]



Sec.  488.430  Civil money penalties: Basis for imposing penalty.

    (a) CMS or the State may impose a civil money penalty for either the 
number of days a facility is not in substantial compliance with one or 
more participation requirements or for each instance that a facility is 
not in substantial compliance, regardless of whether or not the 
deficiencies constitute immediate jeopardy.
    (b) CMS or the State may impose a civil money penalty for the number 
of days of past noncompliance since the last standard survey, including 
the number of days of immediate jeopardy.

[59 FR 56243, Nov. 10, 1994, as amended at 64 FR 13360, Mar. 18, 1999]



Sec.  488.432  Civil money penalties: When a penalty is collected.

    (a) When facility requests a hearing. (1) A facility must request a 
hearing on the determination of the noncompliance that is the basis for 
imposition of the civil money penalty within the time specified in one 
of the following sections:
    (i) Section 498.40 of this chapter for a
    (A) SNF;
    (B) Dually participating facility;
    (C) State-operated NF; or
    (D) Non-State operated NF against which CMS is imposing remedies.
    (ii) Section 431.153 of this chapter for a non-State operated NF 
that is not

[[Page 462]]

subject to imposition of remedies by CMS.
    (2)(i) If a facility requests a hearing within the time specified in 
paragraph (a)(1) of this section, for a civil money penalty imposed per 
day, CMS or the State initiates collection of the penalty when there is 
a final administrative decision that upholds CMS's or the State's 
determination of noncompliance after the facility achieves substantial 
compliance or is terminated.
    (ii) If a facility requests a hearing for a civil money penalty 
imposed per instance of noncompliance within the time specified in 
paragraph (a)(1) of this section, CMS or the State initiates collection 
of the penalty when there is a final administrative decision that 
upholds CMS's or the State's determination of noncompliance.
    (b) When a facility does not request a hearing for a civil money 
penalty imposed per day. (1) If a facility does not request a hearing in 
accordance with paragraph (a) of this section, CMS or the State 
initiates collection of the penalty when the facility--
    (i) Achieves substantial compliance; or
    (ii) Is terminated.
    (2) When a facility does not request a hearing for a civil money 
penalty imposed per instance of noncompliance. If a facility does not 
request a hearing in accordance with paragraph (a) of this section, CMS 
or the State initiates collection of the penalty when the time frame for 
requesting a hearing expires.
    (c) When a facility waives a hearing. (1) If a facility waives, in 
writing, its right to a hearing as specified in Sec.  488.436, for a 
civil money penalty imposed per day, CMS or the State initiates 
collection of the penalty when the facility--
    (i) Achieves substantial compliance; or (ii) Is terminated.
    (2) If a facility waives, in writing, its right to a hearing as 
specified in Sec.  488.436, for a civil money penalty imposed per 
instance of noncompliance, CMS or the State initiates collection of the 
penalty upon receipt of the facility's notification.
    (d) Accrual and computation of penalties for a facility that--
    (1) Requests a hearing or does not request a hearing are specified 
in Sec.  488.440;
    (2) Waives its right to a hearing in writing, are specified in 
Sec. Sec.  488.436(b) and 488.440.
    (e) The collection of civil money penalties is made as provided in 
Sec.  488.442.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995, as amended at 
64 FR 13360, Mar. 18, 1999]



Sec.  488.434  Civil money penalties: Notice of penalty.

    (a) CMS notice of penalty. (1) CMS sends a written notice of the 
penalty to the facility for all facilities except non-State operated NFs 
when the State is imposing the penalty.
    (2) Content of notice. The notice that CMS sends includes--
    (i) The nature of the noncompliance;
    (ii) The statutory basis for the penalty;
    (iii) The amount of penalty per day of noncompliance or the amount 
of the penalty per instance of noncompliance;
    (iv) Any factors specified in Sec.  488.438(f) that were considered 
when determining the amount of the penalty;
    (v) The date of the instance of noncompliance or the date on which 
the penalty begins to accrue;
    (vi) When the penalty stops accruing, if applicable;
    (vii) When the penalty is collected; and
    (viii) Instructions for responding to the notice, including a 
statement of the facility's right to a hearing, and the implication of 
waiving a hearing, as provided in Sec.  488.436.
    (b) State notice of penalty. (1) The State must notify the facility 
in accordance with State procedures for all non-State operated NFs when 
the State takes the action.
    (2) The State's notice must--
    (i) Be in writing; and
    (ii) Include, at a minimum, the information specified in paragraph 
(a)(2) of this section.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995, as amended at 
64 FR 13360, Mar. 18, 1999]

[[Page 463]]



Sec.  488.436  Civil money penalties: Waiver of hearing, reduction of penalty amount.

    (a) Waiver of a hearing. The facility may waive the right to a 
hearing, in writing, within 60 days from the date of the notice imposing 
the civil money penalty.
    (b) Reduction of penalty amount. (1) If the facility waives its 
right to a hearing in accordance with the procedures specified in 
paragraph (a) of this section, CMS or the State reduces the civil money 
penalty amount by 35 percent.
    (2) If the facility does not waive its right to a hearing in 
accordance with the procedures specified in paragraph (a) of this 
section, the civil money penalty is not reduced by 35 percent.

[59 FR 56243, Nov. 10, 1994; 62 FR 44221, Aug. 20, 1997]



Sec.  488.438  Civil money penalties: Amount of penalty.

    (a) Amount of penalty. (1) The penalties are within the following 
ranges, set at $50 increments:
    (i) Upper range--$3,050-$10,000. Penalties in the range of $3,050-
$10,000 per day are imposed for deficiencies constituting immediate 
jeopardy, and as specified in paragraph (d)(2) of this section.
    (ii) Lower range--$50-$3,000. Penalties in the range of $50-$3,000 
per day are imposed for deficiencies that do not constitute immediate 
jeopardy, but either caused actual harm, or caused no actual harm, but 
have the potential for more than minimal harm.
    (2) Per instance penalty. When penalties are imposed for an instance 
of noncompliance, the penalties will be in the range of $1,000-$10,000 
per instance.
    (b) Basis for penalty amount. The amount of penalty is based on 
CMS's or the State's assessment of factors listed in paragraph (f) of 
this section.
    (c) Decreased penalty amounts. Except as specified in paragraph 
(d)(2) of this section, if immediate jeopardy is removed, but the 
noncompliance continues, CMS or the State will shift the penalty amount 
imposed per day to the lower range.
    (d) Increased penalty amounts. (1) Before a hearing requested in 
accordance with Sec.  488.432(a), CMS or the State may propose to 
increase the per day penalty amount for facility noncompliance which, 
after imposition of a lower level penalty amount, becomes sufficiently 
serious to pose immediate jeopardy.
    (2) CMS does and the State must increase the per day penalty amount 
for any repeated deficiencies for which a lower level penalty amount was 
previously imposed, regardless of whether the increased penalty amount 
would exceed the range otherwise reserved for nonimmediate jeopardy 
deficiencies.
    (3) Repeated deficiencies are deficiencies in the same regulatory 
grouping of requirements found at the last survey, subsequently 
corrected, and found again at the next survey.
    (e) Review of the penalty. When an administrative law judge or State 
hearing officer (or higher administrative review authority) finds that 
the basis for imposing a civil money penalty exists, as specified in 
Sec.  488.430, the administrative law judge or State hearing officer (or 
higher administrative review authority) may not--
    (1) Set a penalty of zero or reduce a penalty to zero;
    (2) Review the exercise of discretion by CMS or the State to impose 
a civil money penalty; and
    (3) Consider any factors in reviewing the amount of the penalty 
other than those specified in paragraph (f) of this section.
    (f) Factors affecting the amount of penalty. In determining the 
amount of penalty, CMS does or the State must take into account the 
following factors:
    (1) The facility's history of noncompliance, including repeated 
deficiencies.
    (2) The facility's financial condition.
    (3) The factors specified in Sec.  488.404.
    (4) The facility's degree of culpability. Culpability for purposes 
of this paragraph includes, but is not limited to, neglect, 
indifference, or disregard for resident care, comfort or safety. The 
absence of culpability is not a mitigating circumstance in reducing the 
amount of the penalty.

[59 FR 56243, Nov. 10, 1994, as amended at 64 FR 13360, Mar. 18, 1999; 
68 FR 46072, Aug. 4, 2003]

[[Page 464]]



Sec.  488.440  Civil money penalties: Effective date and duration of penalty.

    (a)(1) The per day civil money penalty may start accruing as early 
as the date that the facility was first out of compliance, as determined 
by CMS or the State.
    (2) A civil money penalty for each instance of noncompliance is 
imposed in a specific amount for that particular deficiency .
    (b) The per day civil money penalty is computed and collectible, as 
specified in Sec. Sec.  488.432 and 488.442, for the number of days of 
noncompliance until the date the facility achieves substantial 
compliance, or, if applicable, the date of termination when--
    (1) CMS's or the State's decision of noncompliance is upheld after a 
final administrative decision;
    (2) The facility waives its right to a hearing in accordance with 
Sec.  488.436; or
    (3) The time for requesting a hearing has expired and CMS or the 
State has not received a hearing request from the facility.
    (c) The entire penalty, whether imposed on a per day or per instance 
basis, is due and collectible as specified in the notice sent to the 
provider under paragraphs (d) and (e) of this section.
    (d)(1) When a civil money penalty is imposed on a per day basis and 
the facility achieves substantial compliance, CMS does or the State must 
send a separate notice to the facility containing the following 
information:
    (i) The amount of penalty per day.
    (ii) The number of days involved.
    (iii) The total amount due.
    (iv) The due date of the penalty.
    (v) The rate of interest assessed on the unpaid balance beginning on 
the due date, as provided in Sec.  488.442.
    (2) When a civil money penalty is imposed for an instance of 
noncompliance, CMS does or the State must send a separate notice to the 
facility containing the following information:
    (i) The amount of the penalty.
    (ii) The total amount due.
    (iii) The due date of the penalty.
    (iv) The rate of interest assessed on the unpaid balance beginning 
on the due date, as provided in Sec.  488.442.
    (e) In the case of a facility for which the provider agreement has 
been terminated and on which a civil money penalty was imposed on a per 
day basis, CMS does or the State must send this penalty information 
after the--
    (1) Final administrative decision is made;
    (2) Facility has waived its right to a hearing in accordance with 
Sec.  488.436; or
    (3) Time for requesting a hearing has expired and CMS or the state 
has not received a hearing request from the facility.
    (f) Accrual of penalties when there is no immediate jeopardy. (1) In 
the case of noncompliance that does not pose immediate jeopardy, the 
daily accrual of per day civil money penalties is imposed for the days 
of noncompliance prior to the notice specified in Sec.  488.434 and an 
additional period of no longer than 6 months following the last day of 
the survey.
    (2) After the period specified in paragraph (f)(1) of this section, 
if the facility has not achieved substantial compliance, CMS terminates 
the provider agreement and the State may terminate the provider 
agreement.
    (g)(1) In a case when per day civil money penalties are imposed, 
when a facility has deficiencies that pose immediate jeopardy, CMS does 
or the State must terminate the provider agreement within 23 calendar 
days after the last day of the survey if the immediate jeopardy remains.
    (2) The accrual of the civil money penalty imposed on a per day 
basis stops on the day the provider agreement is terminated.
    (h)(1) If an on-site revisit is necessary to confirm substantial 
compliance and the provider can supply documentation acceptable to CMS 
or the State agency that substantial compliance was achieved on a date 
preceding the revisit, penalties imposed on a per day basis only accrue 
until that date of correction for which there is written credible 
evidence.
    (2) If an on-site revisit is not necessary to confirm substantial 
compliance, penalties imposed on a per day basis only accrue until the 
date of correction for which CMS or the State receives and accepts 
written credible evidence.

[59 FR 56243, Nov. 10, 1994, as amended at 64 FR 13361, Mar. 18, 1999]

[[Page 465]]



Sec.  488.442  Civil money penalties: Due date for payment of penalty.

    (a) When payments are due for a civil money penalty imposed on a per 
day basis--(1) After a final administrative decision. A civil money 
penalty payment is due 15 days after a final administrative decision is 
made when--
    (i) The facility achieves substantial compliance before the final 
administrative decision; or
    (ii) The effective date of termination occurs before the final 
administrative decision.
    (2) When no hearing was requested. A civil money penalty payment is 
due 15 days after the time period for requesting a hearing has expired 
and a hearing request was not received when--
    (i) The facility achieved substantial compliance before the hearing 
request was due; or
    (ii) The effective date of termination occurs before the hearing 
request was due.
    (3) After a request to waive a hearing. A civil money penalty 
payment is due 15 days after receipt of the written request to waive a 
hearing when--
    (i) The facility achieved substantial compliance before CMS or the 
State received the written waiver of hearing; or
    (ii) The effective date of termination occurs before CMS or the 
State received the written waiver of hearing.
    (4) After substantial compliance is achieved. A civil money penalty 
payment is due 15 days after substantial compliance is achieved when--
    (i) The final administrative decision is made before the facility 
came into substantial compliance;
    (ii) The facility did not file a timely hearing request before it 
came into substantial compliance; or
    (iii) The facility waived its right to a hearing before it came into 
substantial compliance;
    (5) After the effective date of termination. A civil money penalty 
payment is due 15 days after the effective date of termination, if 
before the effective date of termination--
    (i) The final administrative decision was made;
    (ii) The time for requesting a hearing has expired and the facility 
did not request a hearing; or
    (iii) The facility waived its right to a hearing.
    (6) In the cases specified in paragraph (a)(4) of this section, the 
period of noncompliance may not extend beyond 6 months from the last day 
of the survey.
    (b) When payments are due for a civil money penalty imposed for an 
instance of noncompliance. Payment of a civil money penalty is due 15 
days after one of the following dates:
    (1) The final administrative decision is made;
    (2) The time for requesting a hearing has expired and the facility 
did not request a hearing; or
    (3) The facility waived its right to a hearing.
    (c) Deduction of penalty from amount owed. The amount of the 
penalty, when determined, may be deducted from any sum then or later 
owing by CMS or the State to the facility.
    (d) Interest--(1) Assessment. Interest is assessed on the unpaid 
balance of the penalty, beginning on the due date.
    (2) Medicare interest. Medicare rate of interest is the higher of--
    (i) The rate fixed by the Secretary of the Treasury after taking 
into consideration private consumer rates of interest prevailing on the 
date of the notice of the penalty amount due (published quarterly in the 
Federal Register by HHS under 45 CFR 30.13(a)); or
    (ii) The current value of funds (published annually in the Federal 
Register by the Secretary of the Treasury, subject to quarterly 
revisions).
    (3) Medicaid interest. The interest rate for Medicaid is determined 
by the State.
    (e) Penalties collected by CMS. Civil money penalties and 
corresponding interest collected by CMS from--
    (1) Medicare-participating facilities are deposited as miscellaneous 
receipts of the United States Treasury; and
    (2) Medicaid-participating facilities are returned to the State.
    (f) Collection from dually participating facilities. Civil money 
penalties collected from dually participating facilities are deposited 
as miscellaneous receipts of the United States Treasury and returned to 
the State in proportion commensurate with the relative proportions of 
Medicare and Medicaid beds

[[Page 466]]

at the facility actually in use by residents covered by the respective 
programs on the date the civil money penalty begins to accrue.
    (g) Penalties collected by the State. Civil money penalties 
collected by the State must be applied to the protection of the health 
or property of residents of facilities that the State or CMS finds 
noncompliant, such as--
    (1) Payment for the cost of relocating residents to other 
facilities;
    (2) State costs related to the operation of a facility pending 
correction of deficiencies or closure; and
    (3) Reimbursement of residents for personal funds or property lost 
at a facility as a result of actions by the facility or by individuals 
used by the facility to provide services to residents.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995, as amended at 
64 FR 13361, Mar. 18, 1999]



Sec.  488.444  Civil money penalties: Settlement of penalties.

    (a) CMS has authority to settle cases at any time prior to a final 
administrative decision for Medicare-only SNFs, State-operated 
facilities, or other facilities for which CMS's enforcement action 
prevails, in accordance with Sec.  488.330.
    (b) The State has the authority to settle cases at any time prior to 
the evidentiary hearing decision for all cases in which the State's 
enforcement action prevails.



Sec.  488.450  Continuation of payments to a facility with deficiencies.

    (a) Criteria. (1) CMS may continue payments to a facility not in 
substantial compliance for the periods specified in paragraph (c) of 
this section if the following criteria are met:
    (i) The State survey agency finds that it is more appropriate to 
impose alternative remedies than to terminate the facility;
    (ii) The State has submitted a plan and timetable for corrective 
action approved by CMS; and
    (iii) The facility, in the case of a Medicare SNF, or the State, in 
the case of a Medicaid NF, agrees to repay the Federal government 
payments received under this provision if corrective action is not taken 
in accordance with the approved plan and timetable for corrective 
action.
    (2) CMS or the State may terminate the SNF or NF agreement before 
the end of the correction period if the criteria in paragraph (a)(1) of 
this section are not met.
    (b) Cessation of payments. If termination is not sought, either by 
itself or along with another remedy or remedies, or any of the criteria 
set forth in paragraph (a)(1) of this section are not met or agreed to 
by either the facility or the State, the facility or State will receive 
no Medicare or Federal Medicaid payments, as applicable, from the last 
day of the survey.
    (c) Period of continued payments. If the conditions in paragraph 
(a)(1) of this section are met, CMS may continue payments to a Medicare 
facility or to the State for a Medicaid facility with noncompliance that 
does not constitute immediate jeopardy for up to 6 months from the last 
day of the survey.
    (d) Failure to achieve substantial compliance. If the facility does 
not achieve substantial compliance by the end of the period specified in 
paragraph (c) of this section,
    (1) CMS will--
    (i) Terminate the provider agreement of the Medicare SNF in 
accordance with Sec.  488.456; or
    (ii) Discontinue Federal funding to the SNF for Medicare; and
    (iii) Discontinue FFP to the State for the Medicaid NF.
    (2) The State may terminate the provider agreement for the NF.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995]



Sec.  488.452  State and Federal disagreements involving findings not in agreement in non-State operated NFs and dually participating facilities when there is 
          no immediate jeopardy.

    The following rules apply when CMS and the State disagree over 
findings of noncompliance or application of remedies in a non-State 
operated NF or dually participating facility:
    (a) Disagreement over whether facility has met requirements. (1) The 
State's finding of noncompliance takes precedence when--

[[Page 467]]

    (i) CMS finds that a NF or a dually participating facility is in 
substantial compliance with the participation requirements; and
    (ii) The State finds that a NF or dually participating facility has 
not achieved substantial compliance.
    (2) CMS's findings of noncompliance take precedence when--
    (i) CMS finds that a NF or a dually participating facility has not 
achieved substantial compliance; and
    (ii) The State finds that a NF or a dually participating facility is 
in substantial compliance with the participation requirements.
    (3) When CMS's survey findings take precedence, CMS may--
    (i) Impose any of the alternative remedies specified in Sec.  
488.406;
    (ii) Terminate the provider agreement subject to the applicable 
conditions of Sec.  488.450; and
    (iii) Stop FFP to the State for a NF.
    (b) Disagreement over decision to terminate. (1) CMS's decision to 
terminate the participation of a facility takes precedence when--
    (i) Both CMS and the State find that the facility has not achieved 
substantial compliance; and
    (ii) CMS, but not the State, finds that the facility's participation 
should be terminated. CMS will permit continuation of payment during the 
period prior to the effective date of termination not to exceed 6 
months, if the applicable conditions of Sec.  488.450 are met.
    (2) The State's decision to terminate a facility's participation and 
the procedures for appealing such termination, as specified in Sec.  
431.153(c) of this chapter, takes precedence when--
    (i) The State, but not CMS, finds that a NF's participation should 
be terminated; and
    (ii) The State's effective date for the termination of the NF's 
provider agreement is no later than 6 months after the last day of 
survey.
    (c) Disagreement over timing of termination of facility. The State's 
timing of termination takes precedence if it does not occur later than 6 
months after the last day of the survey when both CMS and the State find 
that--
    (1) A facility is not in substantial compliance; and
    (2) The facility's participation should be terminated.
    (d) Disagreement over remedies. (1) When CMS or the State, but not 
both, establishes one or more remedies, in addition to or as an 
alternative to termination, the additional or alternative remedies will 
also apply when--
    (i) Both CMS and the State find that a facility has not achieved 
substantial compliance; and
    (ii) Both CMS and the State find that no immediate jeopardy exists.
    (2) Overlap of remedies. When CMS and the State establish one or 
more remedies, in addition to or as an alternative to termination, only 
the CMS remedies apply when both CMS and the State find that a facility 
has not achieved substantial compliance.
    (e) Regardless of whether CMS's or the State's decision controls, 
only one noncompliance and enforcement decision is applied to the 
Medicaid agreement, and for a dually participating facility, that same 
decision will apply to the Medicare agreement.



Sec.  488.454  Duration of remedies.

    (a) Except as specified in paragraphs (b) and (d) of this section, 
alternative remedies continue until--
    (1) The facility has achieved substantial compliance, as determined 
by CMS or the State based upon a revisit or after an examination of 
credible written evidence that it can verify without an on-site visit; 
or
    (2) CMS or the State terminates the provider agreement.
    (b) In the cases of State monitoring and denial of payment imposed 
for repeated substandard quality of care, remedies continue until--
    (1) CMS or the State determines that the facility has achieved 
substantial compliance and is capable of remaining in substantial 
compliance; or
    (2) CMS or the State terminates the provider agreement.
    (c) In the case of temporary management, the remedy continues 
until--
    (1) CMS or the State determines that the facility has achieved 
substantial compliance and is capable of remaining in substantial 
compliance;
    (2) CMS or the State terminates the provider agreement; or

[[Page 468]]

    (3) The facility which has not achieved substantial compliance 
reassumes management control. In this case, CMS or the State initiates 
termination of the provider agreement and may impose additional 
remedies.
    (d) In the case of a civil money penalty imposed for an instance of 
noncompliance, the remedy is the specific amount of the civil money 
penalty imposed for the particular deficiency.
    (e) If the facility can supply documentation acceptable to CMS or 
the State survey agency that it was in substantial compliance and was 
capable of remaining in substantial compliance, if necessary, on a date 
preceding that of the revisit, the remedies terminate on the date that 
CMS or the State can verify as the date that substantial compliance was 
achieved and the facility demonstrated that it could maintain 
substantial compliance, if necessary.

[59 FR 56243, Nov. 10, 1994; 60 FR 50119, Sept. 28, 1995, as amended at 
64 FR 13361, Mar. 18, 1999]



Sec.  488.456  Termination of provider agreement.

    (a) Effect of termination. Termination of the provider agreement 
ends--
    (1) Payment to the facility; and
    (2) Any alternative remedy.
    (b) Basis for termination. (1) CMS and the State may terminate a 
facility's provider agreement if a facility--
    (i) Is not in substantial compliance with the requirements of 
participation, regardless of whether or not immediate jeopardy is 
present; or
    (ii) Fails to submit an acceptable plan of correction within the 
timeframe specified by CMS or the State.
    (2) CMS and the State terminate a facility's provider agreement if a 
facility--
    (i) Fails to relinquish control to the temporary manager, if that 
remedy is imposed by CMS or the State; or
    (ii) Does not meet the eligibility criteria for continuation of 
payment as set forth in Sec.  488.412(a)(1).
    (c) Notice of termination. Before terminating a provider agreement, 
CMS does and the State must notify the facility and the public--
    (1) At least 2 calendar days before the effective date of 
termination for a facility with immediate jeopardy deficiencies; and
    (2) At least 15 calendar days before the effective date of 
termination for a facility with non-immediate jeopardy deficiencies that 
constitute noncompliance.
    (d) Procedures for termination. (1) CMS terminates the provider 
agreement in accordance with procedures set forth in Sec.  489.53 of 
this chapter; and
    (2) The State must terminate the provider agreement of a NF in 
accordance with procedures specified in parts 431 and 442 of this 
chapter.

Subpart G [Reserved]



Subpart H_Termination of Medicare Coverage and Alternative Sanctions for 
                End-Stage Renal Disease (ESRD) Facilities

    Source: 73 FR 20475, Apr. 15, 2008, unless otherwise noted.



Sec.  488.604  Termination of Medicare coverage.

    (a) Except as otherwise provided in this subpart, failure of a 
supplier of ESRD services to meet one or more of the conditions for 
coverage set forth in part 494 of this chapter will result in 
termination of Medicare coverage of the services furnished by the 
supplier.
    (b) If termination of coverage is based solely on a supplier's 
failure to participate in network activities and pursue network goals, 
as required at Sec.  494.180(i) of this chapter, coverage may be 
reinstated when CMS determines that the supplier is making reasonable 
and appropriate efforts to meet that condition.
    (c) If termination of coverage is based on failure to meet any of 
the other conditions specified in part 494 of this chapter, coverage 
will not be reinstated until CMS finds that the reason for termination 
has been removed and there is reasonable assurance that it will not 
recur.



Sec.  488.606  Alternative sanctions.

    (a) Basis for application of alternative sanctions. CMS may, as an 
alternative to termination of Medicare coverage,

[[Page 469]]

impose one of the sanctions specified in paragraph (b) of this section 
if CMS finds that--
    (1) The supplier fails to participate in the activities and pursue 
the goals of the ESRD network that is designated to encompass the 
supplier's geographic area; and
    (2) This failure does not jeopardize patient health and safety.
    (b) Alternative sanctions. The alternative sanctions that CMS may 
apply in the circumstances specified in paragraph (a) of this section 
include the following:
    (1) Denial of payment for services furnished to patients first 
accepted for care after the effective date of the sanction as specified 
in the sanction notice.
    (2) Reduction of payments, for all ESRD services furnished by the 
supplier, by 20 percent for each 30-day period after the effective date 
of the sanction.
    (3) Withholding of all payments, without interest, for all ESRD 
services furnished by the supplier to Medicare beneficiaries.
    (c) Duration of alternative sanction. An alternative sanction 
remains in effect until CMS finds that the supplier is in substantial 
compliance with the requirement to cooperate in the network plans and 
goals, or terminates coverage of the supplier's services for lack of 
compliance.



Sec.  488.608  Notice of alternative sanction and appeal rights: Termination of coverage.

    (a) Notice of alternative sanction. CMS gives the supplier and the 
general public notice of the alternative sanction and of the effective 
date of the sanction. The effective date of the alternative sanction is 
at least 30 days after the date of the notice.
    (b) Appeal rights. Termination of Medicare coverage of a supplier's 
ESRD services because the supplier no longer meets the conditions for 
coverage of its services is an initial determination appealable under 
part 498 of this chapter.



Sec.  488.610  Notice of appeal rights: Alternative sanctions.

    If CMS proposes to apply an alternative sanction specified in Sec.  
488.606(b), the following rules apply:
    (a) CMS gives the facility notice of the proposed alternative 
sanction and 15 days in which to request a hearing.
    (b) If the facility requests a hearing, CMS provides an informal 
hearing by a CMS official who was not involved in making the appealed 
decision.
    (c) During the informal hearing, the facility--
    (1) May be represented by counsel;
    (2) Has access to the information on which the allegation was based; 
and
    (3) May present, orally or in writing, evidence and documentation to 
refute the finding of failure to participate in network activities and 
pursue network goals.
    (d) If the written decision of the informal hearing supports 
application of the alternative sanction, CMS provides the facility and 
the public, at least 30 days before the effective date of the 
alternative sanction, a written notice that specifies the effective date 
and the reasons for the alternative sanction.



PART 489_PROVIDER AGREEMENTS AND SUPPLIER APPROVAL--Table of Contents




                      Subpart A_General Provisions

Sec.
489.1 Statutory basis.
489.2 Scope of part.
489.3 Definitions.
489.10 Basic requirements.
489.11 Acceptance of a provider as a participant.
489.12 Decision to deny an agreement.
489.13 Effective date of agreement or approval.
489.18 Change of ownership or leasing: Effect on provider agreement.

               Subpart B_Essentials of Provider Agreements

489.20 Basic commitments.
489.21 Specific limitations on charges.
489.22 Special provisions applicable to prepayment requirements.
489.23 Specific limitation on charges for services provided to certain 
          enrollees of fee-for-service FEHB plans.
489.24 Special responsibilities of Medicare hospitals in emergency 
          cases.

[[Page 470]]

489.25 Special requirements concerning CHAMPUS and CHAMPVA programs.
489.26 Special requirements concerning veterans.
489.27 Beneficiary notice of discharge rights.
489.28 Special capitalization requirements for HHAs.
489.29 Special requirements concerning beneficiaries served by the 
          Indian Health Service, Tribal health programs, and urban 
          Indian organization health programs.

                       Subpart C_Allowable Charges

489.30 Allowable charges: Deductibles and coinsurance.
489.31 Allowable charges: Blood.
489.32 Allowable charges: Noncovered and partially covered services.
489.34 Allowable charges: Hospitals participating in State reimbursement 
          control systems or demonstration projects.
489.35 Notice to intermediary.

               Subpart D_Handling of Incorrect Collections

489.40 Definition of incorrect collection.
489.41 Timing and methods of handling.
489.42 Payment of offset amounts to beneficiary or other person.

 Subpart E_Termination of Agreement and Reinstatement After Termination

489.52 Termination by the provider.
489.53 Termination by CMS.
489.54 Termination by the OIG.
489.55 Exceptions to effective date of termination.
489.57 Reinstatement after termination.

               Subpart F_Surety Bond Requirements for HHAs

489.60 Definitions.
489.61 Basic requirement for surety bonds.
489.62 Requirement waived for Government-operated HHAs.
489.63 Parties to the bond.
489.64 Authorized Surety and exclusion of surety companies.
489.65 Amount of the bond.
489.66 Additional requirements of the surety bond.
489.67 Term and type of bond.
489.68 Effect of failure to obtain, maintain, and timely file a surety 
          bond.
489.69 Evidence of compliance.
489.70 Effect of payment by the Surety.
489.71 Surety's standing to appeal Medicare determinations.
489.72 Effect of review reversing CMS's determination.
489.73 Effect of conditions of payment.
489.74 Incorporation into existing provider agreements.

Subparts G-H [Reserved]

                      Subpart I_Advance Directives

489.100 Definition.
489.102 Requirements for providers.
489.104 Effective dates.

    Authority: Secs. 1102, 1819, 1820(e), 1861, 1864(m), 1866, 1869, and 
1871 of the Social Security Act (42 U.S.C. 1302, 1395i-3, 1395x, 
1395aa(m), 1395cc, 1395ff, and 1395hh).

    Source: 45 FR 22937, Apr. 4, 1980, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  489.1  Statutory basis.

    This part implements section 1866 of the Social Security Act. 
Section 1866 specifies the terms of provider agreements, the grounds for 
terminating a provider agreement, the circumstances under which payment 
for new admissions may be denied, and the circumstances under which 
payment may be withheld for failure to make timely utilization review. 
The following other sections of that Act are also pertinent.
    (a) Section 1861 defines the services covered under Medicare and the 
providers that may be reimbursed for furnishing those services.
    (b) Section 1864 provides for the use of State survey agencies to 
ascertain whether certain entities meet the conditions of participation.
    (c) Section 1871 authorizes the Secretary to prescribe regulations 
for the administration of the Medicare program.
    (d) Although section 1866 of the Act speaks only to providers and 
provider agreements, the effective date rules in this part are made 
applicable also to the approval of suppliers that meet the requirements 
specified in Sec.  489.13.
    (e) Section 1861(o)(7) of the Act requires each HHA to provide CMS 
with a surety bond.

[45 FR 22937, Apr. 4, 1980, as amended at 51 FR 24492, July 3, 1986; 62 
FR 43936, Aug. 18, 1997; 63 FR 312, Jan. 5, 1998]



Sec.  489.2  Scope of part.

    (a) Subpart A of this part sets forth the basic requirements for 
submittal

[[Page 471]]

and acceptance of a provider agreement under Medicare. Subpart B of this 
part specifies the basic commitments and limitations that the provider 
must agree to as part of an agreement to provide services. Subpart C 
specifies the limitations on allowable charges to beneficiaries for 
deductibles, coinsurance, copayments, blood, and services that must be 
part of the provider agreement. Subpart D of this part specifies how 
incorrect collections are to be handled. Subpart F sets forth the 
circumstances and procedures for denial of payments for new admissions 
and for withholding of payment as an alternative to termination of a 
provider agreement.
    (b) The following providers are subject to the provisions of this 
part:
    (1) Hospitals.
    (2) Skilled nursing facilities (SNFs).
    (3) Home health agencies (HHAs).
    (4) Clinics, rehabilitation agencies, and public health agencies.
    (5) Comprehensive outpatient rehabilitation facilities (CORFs).
    (6) Hospices.
    (7) Critical access hospital (CAHs).
    (8) Community mental health centers (CMHCs).
    (9) Religious nonmedical health care institutions (RNHCIs).
    (c)(1) Clinics, rehabilitation agencies, and public health agencies 
may enter into provider agreements only for furnishing outpatient 
physical therapy, and speech pathology services.
    (2) CMHCs may enter into provider agreements only to furnish partial 
hospitalization services.

[45 FR 22937, Apr. 4, 1980, as amended at 47 FR 56297, Dec. 15, 1982; 48 
FR 56036, Dec. 15, 1983; 51 FR 24492, July 3, 1986; 58 FR 30676, May 26, 
1993; 59 FR 6578, Feb. 11, 1994; 62 FR 46037, Aug. 29, 1997; 68 FR 
66720, Nov. 28, 2003]



Sec.  489.3  Definitions.

    For purposes of this part--
    Immediate jeopardy means a situation in which the provider's 
noncompliance with one or more requirements of participation has caused, 
or is likely to cause, serious injury, harm, impairment, or death to a 
resident.
    Physician-owned hospital means any participating hospital (as 
defined in Sec.  489.24) in which a physician, or an immediate family 
member of a physician (as defined in Sec.  411.351 of this chapter), has 
an ownership or investment interest in the hospital. The ownership or 
investment interest may be through equity, debt, or other means, and 
includes an interest in an entity that holds an ownership or investment 
interest in the hospital. This definition does not include a hospital 
with physician ownership or investment interests that satisfy the 
requirements at Sec.  411.356(a) or (b) of this chapter.
    Provider agreement means an agreement between CMS and one of the 
providers specified in Sec.  489.2(b) to provide services to Medicare 
beneficiaries and to comply with the requirements of section 1866 of the 
Act.

[48 FR 39837, Sept. 1, 1983, as amended at 51 FR 24492, July 3, 1986; 54 
FR 5373, Feb. 2, 1989; 59 FR 56250, Nov. 10, 1994; 60 FR 50119, Sept. 
28, 1995; 72 FR 47412, Aug. 22, 2007; 73 FR 48757, Aug. 19, 2008]



Sec.  489.10  Basic requirements.

    (a) Any of the providers specified in Sec.  489.2 may request 
participation in Medicare. In order to be accepted, it must meet the 
conditions of participation or requirements (for SNFs) set forth in this 
section and elsewhere in this chapter. The RNHCIs must meet the 
conditions for coverage, conditions for participation and the 
requirements set forth in this section and elsewhere in this chapter.
    (b) In order to participate in the Medicare program, the provider 
must meet the applicable civil rights requirements of:
    (1) Title VI of the Civil Rights Act of 1964, as implemented by 45 
CFR part 80, which provides that no person in the United States shall, 
on the ground of race, color, or national origin, be excluded from 
participation in, be denied the benefits of, or be subject to 
discrimination under, any program or activity receiving Federal 
financial assistance (section 601);
    (2) Section 504 of the Rehabilitation Act of 1973, as implemented by 
45 CFR part 84, which provides that no qualified handicapped person 
shall, on the basis of handicap, be excluded from participation in, be 
denied the benefits of, or otherwise be subject to discrimination under 
any program or activity receiving Federal financial assistance;

[[Page 472]]

    (3) The Age Discrimination Act of 1975, as implemented by 45 CFR 
part 90, which is designed to prohibit discrimination on the basis of 
age in programs or activities receiving Federal financial assistance. 
The Age Discrimination Act also permits federally assisted programs and 
activities, and recipients of Federal funds, to continue to use certain 
age distinctions, and factors other than age, that meet the requirements 
of the Age Discrimination Act and 45 CFR part 90; and
    (4) Other pertinent requirements of the Office of Civil Rights of 
HHS.
    (c) In order for a hospital, SNF, HHA, hospice, or RNHCI to be 
accepted, it must also meet the advance directives requirements 
specified in subpart I of this part.
    (d) The State survey agency will ascertain whether the provider 
meets the conditions of participation or requirements (for SNFs) and 
make its recommendations to CMS.
    (e) In order for a home health agency to be accepted, it must also 
meet the surety bond requirements specified in subpart F of this part.
    (f) In order for a home health agency to be accepted as a new 
provider, it must also meet the capitalization requirements specified in 
subpart B of this part.

[58 FR 61843, Nov. 23, 1993, as amended at 59 FR 6578, Feb. 11, 1994; 63 
FR 312, Jan. 5, 1998; 68 FR 66720, Nov. 28, 2003]



Sec.  489.11  Acceptance of a provider as a participant.

    (a) Action by CMS. If CMS determines that the provider meets the 
requirements, it will send the provider--
    (1) Written notice of that determination; and
    (2) Two copies of the provider agreement.
    (b) Action by provider. If the provider wishes to participate, it 
must return both copies of the agreement, duly signed by an authorized 
official, to CMS, together with a written statement indicating whether 
it has been adjudged insolvent or bankrupt in any State or Federal 
court, or whether any insolvency or bankruptcy actions are pending.
    (c) Notice of acceptance. If CMS accepts the agreement, it will 
return one copy to the provider with a written notice that--
    (1) Indicates the dates on which it was signed by the provider's 
representative and accepted by CMS; and
    (2) Specifies the effective date of the agreement.

[45 FR 22937, Apr. 4, 1980, as amended at 59 FR 56251, Nov. 10, 1994; 62 
FR 43937, Aug. 18, 1997]



Sec.  489.12  Decision to deny an agreement.

    (a) Bases for denial. CMS may refuse to enter into an agreement for 
any of the following reasons:
    (1) Principals of the prospective provider have been convicted of 
fraud (see Sec.  420.204 of this chapter);
    (2) The prospective provider has failed to disclose ownership and 
control interests in accordance with Sec.  420.206 of this chapter;
    (3) The prospective provider is a physician-owned hospital as 
defined in Sec.  489.3 and does not have procedures in place for making 
physician ownership disclosures to patients in accordance with Sec.  
489.20(u); or
    (4) The prospective provider is unable to give satisfactory 
assurance of compliance with the requirements of title XVIII of the Act.
    (b) [Reserved]
    (c) Compliance with civil rights requirements. CMS will not enter 
into a provider agreement if the provider fails to comply with civil 
rights requirements set forth in 45 CFR parts 80, 84, and 90, subject to 
the provisions of Sec.  489.10.

[45 FR 22937, Apr. 4, 1980, as amended at 51 FR 34833, Sept. 30, 1986; 
54 FR 4027, Jan. 27. 1989; 59 FR 6578, Feb. 11, 1994; 59 FR 56251, Nov. 
10, 1994; 72 FR 47413, Aug. 22, 2007]



Sec.  489.13  Effective date of agreement or approval.

    (a) Applicability--(1) General rule. Except as provided in paragraph 
(a)(2) of this section, this section applies to Medicare provider 
agreements with, and supplier approval of, entities that, as a basis for 
participation in Medicare--
    (i) Are subject to survey and certification by CMS or the State 
survey agency; or

[[Page 473]]

    (ii) Are deemed to meet Federal requirements on the basis of 
accreditation by an accrediting organization whose program has CMS 
approval at the time of accreditation survey and accreditation decision.
    (2) Exceptions. (i) For an agreement with a community mental health 
center (CMHC) or a Federally qualified health center (FQHC), the 
effective date is the date on which CMS accepts a signed agreement which 
assures that the CMHC or FQHC meets all Federal requirements.
    (ii) A Medicare supplier approval of a laboratory is effective only 
while the laboratory has in effect a valid CLIA certificate issued under 
part 493 of this chapter, and only for the specialty and subspecialty 
tests it is authorized to perform.
    (b) All Federal requirements are met on the date of survey. The 
agreement or approval is effective on the date the survey (including the 
Life Safety Code survey, if applicable) is completed, if on that date 
the provider or supplier meets all applicable Federal requirements as 
set forth in this chapter. (If the agreement or approval is time-
limited, the new agreement or approval is effective on the day following 
expiration of the current agreement or approval.)
    (c) All Federal requirements are not met on the date of survey. If 
on the date the survey is completed the provider or supplier fails to 
meet any of the requirements specified in paragraph (b) of this section, 
the following rules apply:
    (1) For an agreement with an SNF, the effective date is the date on 
which--
    (i) The SNF is in substantial compliance (as defined in Sec.  
488.301 of this chapter) with the requirements for participation; and
    (ii) CMS or the State survey agency receives from the SNF, if 
applicable, an approvable waiver request.
    (2) For an agreement with, or an approval of, any other provider or 
supplier, (except those specified in paragraph (a)(2) of this section), 
the effective date is the earlier of the following:
    (i) The date on which the provider or supplier meets all 
requirements.
    (ii) The date on which a provider or supplier is found to meet all 
conditions of participation or coverage, but has lower level 
deficiencies, and CMS or the State survey agency receives an acceptable 
plan of correction for the lower level deficiencies, or an approvable 
waiver request, or both. (The date of receipt is the effective date 
regardless of when CMS approves the plan of correction or the waiver 
request, or both.)
    (d) Accredited provider or supplier requests participation in the 
Medicare program--(1) General rule. If the provider or supplier is 
currently accredited by a national accrediting organization whose 
program had CMS approval at the time of accreditation survey and 
accreditation decision, and on the basis of accreditation, CMS has 
deemed the provider or supplier to meet Federal requirements, the 
effective date depends on whether the provider or supplier is subject to 
requirements in addition to those included in the accrediting 
organization's approved program.
    (i) Provider or supplier subject to additional requirements. If the 
provider or supplier is subject to additional requirements, the 
effective date of the agreement or approval is the date on which the 
provider or supplier meets all requirements, including the additional 
requirements.
    (ii) Provider or supplier not subject to additional requirements. 
For a provider or supplier that is not subject to additional 
requirements, the effective date is the date of the provider's or 
supplier's initial request for participation if on that date the 
provider or supplier met all Federal requirements.
    (2) Special rule: Retroactive effective date. If a provider or 
supplier meets the requirements of paragraphs (d)(1) and (d)(1)(i) or 
(d)(1)(ii) of this section, the effective date may be retroactive for up 
to one year to encompass dates on which the provider or supplier 
furnished, to a Medicare beneficiary, covered services for which it has 
not been paid.

[62 FR 43936, Aug. 18, 1997]



Sec.  489.18  Change of ownership or leasing: Effect on provider agreement.

    (a) What constitutes change of ownership--(1) Partnership. In the 
case of a

[[Page 474]]

partnership, the removal, addition, or substitution of a partner, unless 
the partners expressly agree otherwise, as permitted by applicable State 
law, constitutes change of ownership.
    (2) Unincorporated sole proprietorship. Transfer of title and 
property to another party constitutes change of ownership.
    (3) Corporation. The merger of the provider corporation into another 
corporation, or the consolidation of two or more corporations, resulting 
in the creation of a new corporation constitutes change of ownership. 
Transfer of corporate stock or the merger of another corporation into 
the provider corporation does not constitute change of ownership.
    (4) Leasing. The lease of all or part of a provider facility 
constitutes change of ownership of the leased portion.
    (b) Notice to CMS. A provider who is contemplating or negotiating a 
change of ownership must notify CMS.
    (c) Assignment of agreement. When there is a change of ownership as 
specified in paragraph (a) of this section, the existing provider 
agreement will automatically be assigned to the new owner.
    (d) Conditions that apply to assigned agreements. An assigned 
agreement is subject to all applicable statutes and regulations and to 
the terms and conditions under which it was originally issued including, 
but not limited to, the following:
    (1) Any existing plan of correction.
    (2) Compliance with applicable health and safety standards.
    (3) Compliance with the ownership and financial interest disclosure 
requirements of part 420, subpart C, of this chapter.
    (4) Compliance with civil rights requirements set forth in 45 CFR 
Parts 80, 84, and 90.
    (e) Effect of leasing. The provider agreement will be assigned to 
the lessee only to the extent of the leased portion of the facility.

[45 FR 22937, Apr. 4, 1980, as amended at 59 FR 56251, Nov. 10, 1994]



               Subpart B_Essentials of Provider Agreements



Sec.  489.20  Basic commitments.

    The provider agrees to the following:
    (a) To limit its charges to beneficiaries and to other individuals 
on their behalf, in accordance with provisions of subpart C of this 
part.
    (b) To comply with the requirements of subpart D of this part for 
the return or other disposition of any amounts incorrectly collected 
from a beneficiary or any other person in his or her behalf.
    (c) To comply with the requirements of Sec.  420.203 of this chapter 
when it hires certain former employees of intermediaries.
    (d) In the case of a hospital or a CAH that furnishes services to 
Medicare beneficiaries, either to furnish directly or to make 
arrangements (as defined in Sec.  409.3 of this chapter) for all 
Medicare-covered services to inpatients and outpatients of a hospital or 
a CAH except the following:
    (1) Physicians' services that meet the criteria of Sec.  415.102(a) 
of this chapter for payment on a reasonable charge basis.
    (2) Physician assistant services, as defined in section 
1861(s)(2)(K)(i) of the Act, that are furnished after December 31, 1990.
    (3) Nurse practitioner and clinical nurse specialist services, as 
defined in section 1861(s)(2)(K)(ii) of the Act.
    (4) Certified nurse-midwife services, as defined in section 1861(ff) 
of the Act, that are furnished after December 31, 1990.
    (5) Qualified psychologist services, as defined in section 1861(ii) 
of the Act, that are furnished after December 31, 1990.
    (6) Services of an anesthetist, as defined in Sec.  410.69 of this 
chapter.
    (e) In the case of a hospital or CAH that furnishes inpatient 
hospital services or inpatient CAH services for which payment may be 
made under Medicare, to maintain an agreement with a QIO for that 
organization to review the admissions, quality, appropriateness, and 
diagnostic information related to those inpatient services. The 
requirement of this paragraph (e) applies only if, for the area in which 
the hospital or CAH is located, there is a

[[Page 475]]

QIO that has a contract with CMS under part B of title XI of the Act.
    (f) To maintain a system that, during the admission process, 
identifies any primary payers other than Medicare, so that incorrect 
billing and Medicare overpayments can be prevented.
    (g) To bill other primary payers before Medicare.
    (h) If the provider receives payment for the same services from 
Medicare and another payer that is primary to Medicare, to reimburse 
Medicare any overpaid amount within 60 days.
    (i) If the provider receives, from a payer that is primary to 
Medicare, a payment that is reduced because the provider failed to file 
a proper claim--
    (1) To bill Medicare for an amount no greater than would have been 
payable as secondary payment if the primary insurer's payment had been 
based on a proper claim; and
    (2) To charge the beneficiary only: (i) The amount it would have 
been entitled to charge if it had filed a proper claim and received 
payment based on such a claim; and
    (ii) An amount equal to any primary payment reduction attributable 
to failure to file a proper claim, but only if the provider can show 
that--
    (A) It failed to file a proper claim solely because the beneficiary, 
for any reason other than mental or physical incapacity, failed to give 
the provider the necessary information; or
    (B) The beneficiary, who was responsible for filing a proper claim, 
failed to do so for any reason other than mental or physical incapacity.
    (j) In the State of Oregon, because of a court decision, and in the 
absence of a reversal on appeal or a statutory clarification overturning 
the decision, hospitals may bill liability insurers first. However, if 
the liability insurer does not pay ``promptly'', as defined in Sec.  
411.50 of this chapter, the hospital must withdraw its claim or lien and 
bill Medicare for covered services.
    (k) In the case of home health agencies that provide home health 
services to Medicare beneficiaries under subpart E of part 409 and 
subpart C f part 410 of this chapter, to offer to furnish catheters, 
catheter supplies, ostomy bags, and supplies related to ostomy care to 
any individual who requires them as part of their furnishing of home 
health services.
    (l) In the case of a hospital as defined in Sec.  489.24(b) to 
comply with Sec.  489.24.
    (m) In the case of a hospital as defined in Sec.  489.24(b), to 
report to CMS or the State survey agency any time it has reason to 
believe it may have received an individual who has been transferred in 
an unstable emergency medical condition from another hospital in 
violation of the requirements of Sec.  489.24(e).
    (n) In the case of inpatient hospital services, to participate in 
any health plan contracted for under 10 U.S.C. 1079 or 1086 or 38 U.S.C. 
613, in accordance with Sec.  489.25.
    (o) In the case of inpatient hospital services, to admit veterans 
whose admission has been authorized under 38 U.S.C. 603, in accordance 
with Sec.  489.26.
    (p) To comply with Sec.  489.27 of this part concerning notification 
of Medicare beneficiaries of their rights associated with the 
termination of Medicare services.
    (q) In the case of a hospital as defined in Sec.  489.24(b)--
    (1) To post conspicuously in any emergency department or in a place 
or places likely to be noticed by all individuals entering the emergency 
department, as well as those individuals waiting for examination and 
treatment in areas other than traditional emergency departments (that 
is, entrance, admitting area, waiting room, treatment area), a sign (in 
a form specified by the Secretary) specifying rights of individuals 
under Section 1867 of the Act with respect to examination and treatment 
for emergency medical conditions and women in labor; and
    (2) To post conspicuously (in a form specified by the Secretary) 
information indicating whether or not the hospital or rural primary care 
hospital participates in the Medicaid program under a State plan 
approved under title XIX.
    (r) In the case of a hospital as defined in Sec.  489.24(b) 
(including both the transferring and receiving hospitals), to maintain--
    (1) Medical and other records related to individuals transferred to 
or from the hospital for a period of 5 years from the date of the 
transfer;

[[Page 476]]

    (2) An on-call list of physicians who are on the hospital's medical 
staff or who have privileges at the hospital, or who are on the staff or 
have privileges at another hospital participating in a formal community 
call plan, in accordance with Sec.  489.24(j)(2)(iii), available to 
provide treatment necessary after the initial examination to stabilize 
individuals with emergency medical conditions who are receiving services 
required under Sec.  489.24 in accordance with the resources available 
to the hospital; and
    (3) A central log on each individual who comes to the emergency 
department, as defined in Sec.  489.24(b), seeking assistance and 
whether he or she refused treatment, was refused treatment, or whether 
he or she was transferred, admitted and treated, stabilized and 
transferred, or discharged.
    (s) In the case of an SNF, either to furnish directly or make 
arrangements (as defined in Sec.  409.3 of this chapter) for all 
Medicare-covered services furnished to a resident (as defined in Sec.  
411.15(p)(3) of this chapter) of the SNF, except the following:
    (1) Physicians' services that meet the criteria of Sec.  415.102(a) 
of this chapter for payment on a fee schedule basis.
    (2) Services performed under a physician's supervision by a 
physician assistant who meets the applicable definition in section 
1861(aa)(5) of the Act.
    (3) Services performed by a nurse practitioner or clinical nurse 
specialist who meets the applicable definition in section 1861(aa)(5) of 
the Act and is working in collaboration (as defined in section 
1861(aa)(6) of the Act) with a physician.
    (4) Services performed by a certified nurse-midwife, as defined in 
section 1861(gg) of the Act.
    (5) Services performed by a qualified psychologist, as defined in 
section 1861(ii) of the Act.
    (6) Services performed by a certified registered nurse anesthetist, 
as defined in section 1861(bb) of the Act.
    (7) Dialysis services and supplies, as defined in section 
1861(s)(2)(F) of the Act, and those ambulance services that are 
furnished in conjunction with them.
    (8) Erythropoietin (EPO) for dialysis patients, as defined in 
section 1861(s)(2)(O) of the Act.
    (9) Hospice care, as defined in section 1861(dd) of the Act.
    (10) An ambulance trip that initially conveys an individual to the 
SNF to be admitted as a resident, or that conveys an individual from the 
SNF in connection with one of the circumstances specified in Sec.  
411.15(p)(3)(i) through (p)(3)(iv) of this chapter as ending the 
individual's status as an SNF resident.
    (11) The transportation costs of electrocardiogram equipment (HCPCS 
code R0076), but only with respect to those electrocardiogram test 
services furnished during 1998.
    (12) Services described in paragraphs (s)(1) through (6) of this 
section when furnished via telehealth under section 
1834(m)(4)(C)(ii)(VII) of the Act.
    (13) Those chemotherapy items identified, as of July 1, 1999, by 
HCPCS codes J9000-J9020; J9040-J9151; J9170-J9185; J9200-J9201; J9206-
J9208; J9211; J9230-J9245; and J9265-J9600; and, as of January 1, 2004, 
by HCPCS codes A9522, A9523, A9533, and A9534.
    (14) Those chemotherapy administration services identified, as of 
July 1, 1999, by HCPCS codes 36260-36262; 36489; 36530-36535; 36640; 
36823; and 96405-96542.
    (15) Those radioisotope services identified, as of July 1, 1999, by 
HCPCS codes 79030-79440.
    (16) Those customized prosthetic devices (including artificial limbs 
and their components) identified, as of July 1, 1999, by HCPCS codes 
L5050-L5340; L5500-L5611; L5613-L5986; L5988; L6050-L6370; L6400-6880; 
L6920-L7274; and L7362-L7366, which are delivered for a resident's use 
during a stay in the SNF and intended to be used by the resident after 
discharge from the SNF.
    (t) Hospitals that are not otherwise subject to the Occupational 
Safety and Health Act of 1970 (or a State occupational safety and health 
plan that is approved under section 18(b) of the Occupational Safety and 
Health Act) must comply with the bloodborne pathogens (BBP) standards 
under 29 CFR 1910.1030. A hospital that fails to comply with the BBP 
standards may be subject to a civil money penalty in accordance with 
section 17 of the Occupational Safety and Health Act of 1970,

[[Page 477]]

including any adjustments of the civil money penalty amounts under the 
Federal Civil Penalties Inflation Adjustment Act, for a violation of the 
BBP standards. A civil money penalty will be imposed and collected in 
the same manner as civil money penalties under section 1128A(a) of the 
Social Security Act.
    (u) Except as provided in paragraph (v) of this section, in the case 
of a physician-owned hospital as defined at Sec.  489.3--
    (1) To furnish written notice to each patient at the beginning of 
the patient's hospital stay or outpatient visit that the hospital is a 
physician-owned hospital, in order to assist the patient in making an 
informed decision regarding his or her care, in accordance with Sec.  
482.13(b)(2) of this subchapter. The notice should disclose, in a manner 
reasonably designed to be understood by all patients, the fact that the 
hospital meets the Federal definition of a physician-owned hospital 
specified in Sec.  489.3 and that the list of the hospital's owners or 
investors who are physicians or immediate family members (as defined at 
Sec.  411.351 of this chapter) of physicians is available upon request 
and must be provided to the patient at the time the request for the list 
is made by or on behalf of the patient. For purposes of this paragraph 
(u)(1), the hospital stay or outpatient visit begins with the provision 
of a package of information regarding scheduled preadmission testing and 
registration for a planned hospital admission for inpatient care or an 
outpatient service.
    (2) To require each physician who is a member of the hospital's 
medical staff to agree, as a condition of continued medical staff 
membership or admitting privileges, to disclose, in writing, to all 
patients the physician refers to the hospital any ownership or 
investment interest in the hospital that is held by the physician or by 
an immediate family member (as defined at Sec.  411.351 of this chapter) 
of the physician. Disclosure must be required at the time the referral 
is made.
    (v) The requirements of paragraph (u) of this section do not apply 
to any physician-owned hospital that does not have at least one 
referring physician (as defined at Sec.  411.351 of this chapter) who 
has an ownership or investment interest in the hospital or who has an 
immediate family member who has an ownership or investment interest in 
the hospital, provided that such hospital signs an attestation statement 
to that effect and maintains such attestation in its records.
    (w) In the case of a hospital as defined in Sec.  489.24(b), to 
furnish written notice to all patients at the beginning of their 
hospital stay or outpatient visit if a doctor of medicine or a doctor of 
osteopathy is not present in the hospital 24 hours per day, 7 days per 
week, in order to assist the patients in making informed decisions 
regarding their care, in accordance with Sec.  482.13(b)(2) of this 
subchapter. The notice must indicate how the hospital will meet the 
medical needs of any patient who develops an emergency medical 
condition, as defined in Sec.  489.24(b), at a time when there is no 
physician present in the hospital. For purposes of this paragraph, the 
hospital stay or outpatient visit begins with the provision of a package 
of information regarding scheduled preadmission testing and registration 
for a planned hospital admission for inpatient care or outpatient 
service.
    (x) To comply with Sec.  488.30 of this chapter, to pay revisit user 
fees when and if assessed.

[45 FR 22937, Apr. 4, 1980, as amended at 48 FR 39837, Sept. 1, 1983; 49 
FR 323, Jan. 3, 1984; 54 FR 41747, Oct. 11, 1989; 57 FR 36018, Aug. 12, 
1992; 58 FR 30677, May 26, 1993; 59 FR 32120, June 22, 1994; 60 FR 
63189, Dec. 8, 1995; 62 FR 46037, Aug. 29, 1997; 63 FR 26312, May 12, 
1998; 65 FR 18548, Apr. 7, 2000; 65 FR 46796, July 31, 2000; 66 FR 
39601, July 31, 2001; 68 FR 16669, Apr. 4, 2003; 68 FR 43942, July 25, 
2003; 68 FR 46072, Aug. 4, 2003; 69 FR 49272, Aug. 11, 2004; 70 FR 
45055, Aug. 4, 2005; 71 FR 9471, Feb. 24, 2006; 72 FR 47413, Aug. 22, 
2007; 72 FR 53649, Sept. 19, 2007; 73 FR 48757, Aug. 19, 2008; 73 FR 
69942, Nov. 19, 2008]

    Effective Date Note: At 59 FR 32120, June 22, 1994, in Sec.  489.20, 
paragraphs (l) through (r) were added. Paragraphs (m), (r)(2) and (r)(3) 
contain information collection and recordkeeping requirements and will 
not become effective until approval has been given by the Office of 
Management and Budget.



Sec.  489.21  Specific limitations on charges.

    Except as specified in subpart C of this part, the provider agrees 
not to

[[Page 478]]

charge a beneficiary for any of the following:
    (a) Services for which the beneficiary is entitled to have payment 
made under Medicare.
    (b) Services for which the beneficiary would be entitled to have 
payment made if the provider--
    (1) Had in its files the required certification and recertification 
by a physician relating to the services furnished to the beneficiary;
    (2) Had furnished the information required by the intermediary in 
order to determine the amount due the provider on behalf of the 
individual for the period with respect to which payment is to be made or 
any prior period;
    (3) Had complied with the provisions requiring timely utilization 
review of long stay cases so that a limitation on days of service has 
not been imposed under section 1866(d) of the Act (see subpart K of part 
405 and part 482 of this chapter for utilization review requirements); 
and
    (4) Had obtained, from the beneficiary or a person acting on his or 
her behalf, a written request for payment to be made to the provider, 
and had properly filed that request. (If the beneficiary or person on 
his or her behalf refuses to execute a written request, the provider may 
charge the beneficiary for all services furnished to him or her.)
    (c) Inpatient hospital services furnished to a beneficiary who 
exhausted his or her Part A benefits, if CMS reimburses the provider for 
those services.
    (d) Custodial care and services not reasonable and necessary for the 
diagnosis or treatment of illness or injury, if--
    (1) The beneficiary was without fault in incurring the expenses; and
    (2) The determination that payment was incorrect was not made until 
after the third year following the year in which the payment notice was 
sent to the beneficiary.
    (e) Inpatient hospital services for which a beneficiary would be 
entitled to have payment made under Part A of Medicare but for a denial 
or reduction in payments under regulations at Sec.  412.48 of this 
chapter or under section 1886(f) of the Act.
    (f) Items and services furnished to a hospital inpatient (other than 
physicians' services as described in Sec.  415.102(a) of this chapter or 
the services of an anesthetist as described in Sec.  405.553(b)(4) of 
this chapter) for which Medicare payment would be made if furnished by 
the hospital or by other providers or suppliers under arrangements made 
with them by the hospital. For this purpose, a charge by another 
provider or supplier for such an item or service is treated as a charge 
by the hospital for the item or service, and is also prohibited.
    (g) [Reserved]
    (h) Items and services (other than those described in Sec. Sec.  
489.20(s)(1) through (15)) required to be furnished under Sec.  
489.20(s) to a resident of an SNF (defined in Sec.  411.15(p) of this 
chapter), for which Medicare payment would be made if furnished by the 
SNF or by other providers or suppliers under arrangements made with them 
by the SNF. For this purpose, a charge by another provider or supplier 
for such an item or service is treated as a charge by the SNF for the 
item or service, and is also prohibited.

[49 FR 324, Jan. 3, 1984, as amended at 51 FR 22052, June 17, 1986; 52 
FR 27765, July 23, 1987; 60 FR 63189, Dec. 8, 1995; 64 FR 41683, July 
30, 1999; 65 FR 46796, July 31, 2000; 65 FR 62646, Oct. 19, 2000; 66 FR 
39601, July 31, 2001]



Sec.  489.22  Special provisions applicable to prepayment requirements.

    (a) A provider may not require an individual entitled to hospital 
insurance benefits to prepay in part or in whole for inpatient services 
as a condition of admittance as an inpatient, except where it is clear 
upon admission that payment under Medicare, Part A cannot be made.
    (b) A provider may not deny covered inpatient services to an 
individual entitled to have payment made for those services on the 
ground of inability or failure to pay a requested amount at or before 
admission.
    (c) A provider may not evict, or threaten to evict, an individual 
for inability to pay a deductible or a coinsurance amount required under 
Medicare.
    (d) A provider may not charge an individual for (1) its agreement to 
admit

[[Page 479]]

or readmit the individual on some specified future date for covered 
inpatient services; or (2) for failure to remain an inpatient for any 
agreed-upon length of time or for failure to give advance notice of 
departure from the provider's facilities.

[45 FR 22937, Apr. 4, 1980, as amended at 68 FR 46072, Aug. 4, 2003]



Sec.  489.23  Specific limitation on charges for services provided to certain enrollees of fee-for-service FEHB plans.

    A provider that furnishes inpatient hospital services to a retired 
Federal worker age 65 or older who is enrolled in a fee-for-service FEHB 
plan and who is not covered under Medicare Part A, must accept, as 
payment in full, an amount that approximates as closely as possible the 
Medicare inpatient hospital prospective payment system (PPS) rate 
established under part 412. The payment to the provider is composed of a 
payment from the FEHB plan and a payment from the enrollee. This 
combined payment approximates the Medicare PPS rate. The payment from 
the FEHB plan approximates, as closely as possible, the Medicare PPS 
rate minus any applicable enrollee deductible, coinsurance, or copayment 
amount. The payment from the enrollee is equal to the applicable 
deductible, coinsurance, or copayment amount.

[62 FR 56111, Oct. 29, 1997]



Sec.  489.24  Special responsibilities of Medicare hospitals in emergency cases.

    (a) Applicability of provisions of this section. (1) In the case of 
a hospital that has an emergency department, if an individual (whether 
or not eligible for Medicare benefits and regardless of ability to pay) 
``comes to the emergency department'', as defined in paragraph (b) of 
this section, the hospital must--
    (i) Provide an appropriate medical screening examination within the 
capability of the hospital's emergency department, including ancillary 
services routinely available to the emergency department, to determine 
whether or not an emergency medical condition exists. The examination 
must be conducted by an individual(s) who is determined qualified by 
hospital bylaws or rules and regulations and who meets the requirements 
of Sec.  482.55 of this chapter concerning emergency services personnel 
and direction; and
    (ii) If an emergency medical condition is determined to exist, 
provide any necessary stabilizing treatment, as defined in paragraph (d) 
of this section, or an appropriate transfer as defined in paragraph (e) 
of this section. If the hospital admits the individual as an inpatient 
for further treatment, the hospital's obligation under this section 
ends, as specified in paragraph (d)(2) of this section.
    (2)(i) When a waiver has been issued in accordance with section 1135 
of the Act that includes a waiver under section 1135(b)(3) of the Act, 
sanctions under this section for an inappropriate transfer or for the 
direction or relocation of an individual to receive medical screening at 
an alternate location do not apply to a hospital with a dedicated 
emergency department if the following conditions are met:
    (A) The transfer is necessitated by the circumstances of the 
declared emergency in the emergency area during the emergency period.
    (B) The direction or relocation of an individual to receive medical 
screening at an alternate location is pursuant to an appropriate State 
emergency preparedness plan or, in the case of a public health emergency 
that involves a pandemic infectious disease, pursuant to a State 
pandemic preparedness plan.
    (C) The hospital does not discriminate on the basis of an 
individual's source of payment or ability to pay.
    (D) The hospital is located in an emergency area during an emergency 
period, as those terms are defined in section 1135(g)(1) of the Act.
    (E) There has been a determination that a waiver of sanctions is 
necessary.
    (ii) A waiver of these sanctions is limited to a 72-hour period 
beginning upon the implementation of a hospital disaster protocol, 
except that, if a public health emergency involves a pandemic infectious 
disease (such as pandemic influenza), the waiver will continue in effect 
until the termination of the applicable declaration of a public

[[Page 480]]

health emergency, as provided under section 1135(e)(1)(B) of the Act.
    (b) Definitions. As used in this subpart--
    Capacity means the ability of the hospital to accommodate the 
individual requesting examination or treatment of the transferred 
individual. Capacity encompasses such things as numbers and availability 
of qualified staff, beds and equipment and the hospital's past practices 
of accommodating additional patients in excess of its occupancy limits.
    Comes to the emergency department means, with respect to an 
individual who is not a patient (as defined in this section), the 
individual--
    (1) Has presented at a hospital's dedicated emergency department, as 
defined in this section, and requests examination or treatment for a 
medical condition, or has such a request made on his or her behalf. In 
the absence of such a request by or on behalf of the individual, a 
request on behalf of the individual will be considered to exist if a 
prudent layperson observer would believe, based on the individual's 
appearance or behavior, that the individual needs examination or 
treatment for a medical condition;
    (2) Has presented on hospital property, as defined in this section, 
other than the dedicated emergency department, and requests examination 
or treatment for what may be an emergency medical condition, or has such 
a request made on his or her behalf. In the absence of such a request by 
or on behalf of the individual, a request on behalf of the individual 
will be considered to exist if a prudent layperson observer would 
believe, based on the individual's appearance or behavior, that the 
individual needs emergency examination or treatment;
    (3) Is in a ground or air ambulance owned and operated by the 
hospital for purposes of examination and treatment for a medical 
condition at a hospital's dedicated emergency department, even if the 
ambulance is not on hospital grounds. However, an individual in an 
ambulance owned and operated by the hospital is not considered to have 
``come to the hospital's emergency department'' if--
    (i) The ambulance is operated under communitywide emergency medical 
service (EMS) protocols that direct it to transport the individual to a 
hospital other than the hospital that owns the ambulance; for example, 
to the closest appropriate facility. In this case, the individual is 
considered to have come to the emergency department of the hospital to 
which the individual is transported, at the time the individual is 
brought onto hospital property;
    (ii) The ambulance is operated at the direction of a physician who 
is not employed or otherwise affiliated with the hospital that owns the 
ambulance; or
    (4) Is in a ground or air nonhospital-owned ambulance on hospital 
property for presentation for examination and treatment for a medical 
condition at a hospital's dedicated emergency department. However, an 
individual in a nonhospital-owned ambulance off hospital property is not 
considered to have come to the hospital's emergency department, even if 
a member of the ambulance staff contacts the hospital by telephone or 
telemetry communications and informs the hospital that they want to 
transport the individual to the hospital for examination and treatment. 
The hospital may direct the ambulance to another facility if it is in 
``diversionary status,'' that is, it does not have the staff or 
facilities to accept any additional emergency patients. If, however, the 
ambulance staff disregards the hospital's diversion instructions and 
transports the individual onto hospital property, the individual is 
considered to have come to the emergency department.
    Dedicated emergency department means any department or facility of 
the hospital, regardless of whether it is located on or off the main 
hospital campus, that meets at least one of the following requirements:
    (1) It is licensed by the State in which it is located under 
applicable State law as an emergency room or emergency department;
    (2) It is held out to the public (by name, posted signs, 
advertising, or other means) as a place that provides care for emergency 
medical conditions on an urgent basis without requiring a previously 
scheduled appointment; or

[[Page 481]]

    (3) During the calendar year immediately preceding the calendar year 
in which a determination under this section is being made, based on a 
representative sample of patient visits that occurred during that 
calendar year, it provides at least one-third of all of its outpatient 
visits for the treatment of emergency medical conditions on an urgent 
basis without requiring a previously scheduled appointment.
    Emergency medical condition means--
    (1) A medical condition manifesting itself by acute symptoms of 
sufficient severity (including severe pain, psychiatric disturbances 
and/or symptoms of substance abuse) such that the absence of immediate 
medical attention could reasonably be expected to result in--
    (i) Placing the health of the individual (or, with respect to a 
pregnant woman, the health of the woman or her unborn child) in serious 
jeopardy;
    (ii) Serious impairment to bodily functions; or
    (iii) Serious dysfunction of any bodily organ or part; or
    (2) With respect to a pregnant woman who is having contractions--
    (i) That there is inadequate time to effect a safe transfer to 
another hospital before delivery; or
    (ii) That transfer may pose a threat to the health or safety of the 
woman or the unborn child.
    Hospital includes a critical access hospital as defined in section 
1861(mm)(1) of the Act.
    Hospital property means the entire main hospital campus as defined 
in Sec.  413.65(b) of this chapter, including the parking lot, sidewalk, 
and driveway, but excluding other areas or structures of the hospital's 
main building that are not part of the hospital, such as physician 
offices, rural health centers, skilled nursing facilities, or other 
entities that participate separately under Medicare, or restaurants, 
shops, or other nonmedical facilities.
    Hospital with an emergency department means a hospital with a 
dedicated emergency department as defined in this paragraph (b).
    Inpatient means an individual who is admitted to a hospital for bed 
occupancy for purposes of receiving inpatient hospital services as 
described in Sec.  409.10(a) of this chapter with the expectation that 
he or she will remain at least overnight and occupy a bed even though 
the situation later develops that the individual can be discharged or 
transferred to another hospital and does not actually use a hospital bed 
overnight.
    Labor means the process of childbirth beginning with the latent or 
early phase of labor and continuing through the delivery of the 
placenta. A woman experiencing contractions is in true labor unless a 
physician, certified nurse-midwife, or other qualified medical person 
acting within his or her scope of practice as defined in hospital 
medical staff bylaws and State law, certifies that, after a reasonable 
time of observation, the woman is in false labor.
    Participating hospital means (1) a hospital or (2) a critical access 
hospital as defined in section 1861(mm)(1) of the Act that has entered 
into a Medicare provider agreement under section 1866 of the Act.
    Patient means--
    (1) An individual who has begun to receive outpatient services as 
part of an encounter, as defined in Sec.  410.2 of this chapter, other 
than an encounter that the hospital is obligated by this section to 
provide;
    (2) An individual who has been admitted as an inpatient, as defined 
in this section.
    Stabilized means, with respect to an ``emergency medical condition'' 
as defined in this section under paragraph (1) of that definition, that 
no material deterioration of the condition is likely, within reasonable 
medical probability, to result from or occur during the transfer of the 
individual from a facility or, with respect to an ``emergency medical 
condition'' as defined in this section under paragraph (2) of that 
definition, that the woman has delivered the child and the placenta.
    To stabilize means, with respect to an ``emergency medical 
condition'' as defined in this section under paragraph (1) of that 
definition, to provide such medical treatment of the condition necessary 
to assure, within reasonable medical probability, that no material 
deterioration of the condition is likely to result from or occur during 
the

[[Page 482]]

transfer of the individual from a facility or that, with respect to an 
``emergency medical condition'' as defined in this section under 
paragraph (2) of that definition, the woman has delivered the child and 
the placenta.
    Transfer means the movement (including the discharge) of an 
individual outside a hospital's facilities at the direction of any 
person employed by (or affiliated or associated, directly or indirectly, 
with) the hospital, but does not include such a movement of an 
individual who (i) has been declared dead, or (ii) leaves the facility 
without the permission of any such person.
    (c) Use of dedicated emergency department for nonemergency services. 
If an individual comes to a hospital's dedicated emergency department 
and a request is made on his or her behalf for examination or treatment 
for a medical condition, but the nature of the request makes it clear 
that the medical condition is not of an emergency nature, the hospital 
is required only to perform such screening as would be appropriate for 
any individual presenting in that manner, to determine that the 
individual does not have an emergency medical condition.
    (d) Necessary stabilizing treatment for emergency medical 
conditions--(1) General. Subject to the provisions of paragraph (d)(2) 
of this section, if any individual (whether or not eligible for Medicare 
benefits) comes to a hospital and the hospital determines that the 
individual has an emergency medical condition, the hospital must provide 
either--
    (i) Within the capabilities of the staff and facilities available at 
the hospital, for further medical examination and treatment as required 
to stabilize the medical condition.
    (ii) For transfer of the individual to another medical facility in 
accordance with paragraph (e) of this section.
    (2) Exception: Application to inpatients. (i) If a hospital has 
screened an individual under paragraph (a) of this section and found the 
individual to have an emergency medical condition, and admits that 
individual as an inpatient in good faith in order to stabilize the 
emergency medical condition, the hospital has satisfied its special 
responsibilities under this section with respect to that individual.
    (ii) This section is not applicable to an inpatient who was admitted 
for elective (nonemergency) diagnosis or treatment.
    (iii) A hospital is required by the conditions of participation for 
hospitals under Part 482 of this chapter to provide care to its 
inpatients in accordance with those conditions of participation.
    (3) Refusal to consent to treatment. A hospital meets the 
requirements of paragraph (d)(1)(i) of this section with respect to an 
individual if the hospital offers the individual the further medical 
examination and treatment described in that paragraph and informs the 
individual (or a person acting on the individual's behalf) of the risks 
and benefits to the individual of the examination and treatment, but the 
individual (or a person acting on the individual's behalf) does not 
consent to the examination or treatment. The medical record must contain 
a description of the examination, treatment, or both if applicable, that 
was refused by or on behalf of the individual. The hospital must take 
all reasonable steps to secure the individual's written informed refusal 
(or that of the person acting on his or her behalf). The written 
document should indicate that the person has been informed of the risks 
and benefits of the examination or treatment, or both.
    (4) Delay in examination or treatment. (i) A participating hospital 
may not delay providing an appropriate medical screening examination 
required under paragraph (a) of this section or further medical 
examination and treatment required under paragraph (d)(1) of this 
section in order to inquire about the individual's method of payment or 
insurance status.
    (ii) A participating hospital may not seek, or direct an individual 
to seek, authorization from the individual's insurance company for 
screening or stabilization services to be furnished by a hospital, 
physician, or nonphysician practitioner to an individual until after the 
hospital has provided the appropriate medical screening examination 
required under paragraph (a) of this section, and initiated any further

[[Page 483]]

medical examination and treatment that may be required to stabilize the 
emergency medical condition under paragraph (d)(1) of this section.
    (iii) An emergency physician or nonphysician practitioner is not 
precluded from contacting the individual's physician at any time to seek 
advice regarding the individual's medical history and needs that may be 
relevant to the medical treatment and screening of the patient, as long 
as this consultation does not inappropriately delay services required 
under paragraph (a) or paragraphs (d)(1) and (d)(2) of this section.
    (iv) Hospitals may follow reasonable registration processes for 
individuals for whom examination or treatment is required by this 
section, including asking whether an individual is insured and, if so, 
what that insurance is, as long as that inquiry does not delay screening 
or treatment. Reasonable registration processes may not unduly 
discourage individuals from remaining for further evaluation.
    (5) Refusal to consent to transfer. A hospital meets the 
requirements of paragraph (d)(1)(ii) of this section with respect to an 
individual if the hospital offers to transfer the individual to another 
medical facility in accordance with paragraph (e) of this section and 
informs the individual (or a person acting on his or her behalf) of the 
risks and benefits to the individual of the transfer, but the individual 
(or a person acting on the individual's behalf) does not consent to the 
transfer. The hospital must take all reasonable steps to secure the 
individual's written informed refusal (or that of a person acting on his 
or her behalf). The written document must indicate the person has been 
informed of the risks and benefits of the transfer and state the reasons 
for the individual's refusal. The medical record must contain a 
description of the proposed transfer that was refused by or on behalf of 
the individual.
    (e) Restricting transfer until the individual is stabilized--(1) 
General. If an individual at a hospital has an emergency medical 
condition that has not been stabilized (as defined in paragraph (b) of 
this section), the hospital may not transfer the individual unless--
    (i) The transfer is an appropriate transfer (within the meaning of 
paragraph (e)(2) of this section); and
    (ii)(A) The individual (or a legally responsible person acting on 
the individual's behalf) requests the transfer, after being informed of 
the hospital's obligations under this section and of the risk of 
transfer. The request must be in writing and indicate the reasons for 
the request as well as indicate that he or she is aware of the risks and 
benefits of the transfer;
    (B) A physician (within the meaning of section 1861(r)(1) of the 
Act) has signed a certification that, based upon the information 
available at the time of transfer, the medical benefits reasonably 
expected from the provision of appropriate medical treatment at another 
medical facility outweigh the increased risks to the individual or, in 
the case of a woman in labor, to the woman or the unborn child, from 
being transferred. The certification must contain a summary of the risks 
and benefits upon which it is based; or
    (C) If a physician is not physically present in the emergency 
department at the time an individual is transferred, a qualified medical 
person (as determined by the hospital in its by-laws or rules and 
regulations) has signed a certification described in paragraph 
(e)(1)(ii)(B) of this section after a physician (as defined in section 
1861(r)(1) of the Act) in consultation with the qualified medical 
person, agrees with the certification and subsequently countersigns the 
certification. The certification must contain a summary of the risks and 
benefits upon which it is based.
    (2) A transfer to another medical facility will be appropriate only 
in those cases in which--
    (i) The transferring hospital provides medical treatment within its 
capacity that minimizes the risks to the individual's health and, in the 
case of a woman in labor, the health of the unborn child;
    (ii) The receiving facility--
    (A) Has available space and qualified personnel for the treatment of 
the individual; and
    (B) Has agreed to accept transfer of the individual and to provide 
appropriate medical treatment;

[[Page 484]]

    (iii) The transferring hospital sends to the receiving facility all 
medical records (or copies thereof) related to the emergency condition 
which the individual has presented that are available at the time of the 
transfer, including available history, records related to the 
individual's emergency medical condition, observations of signs or 
symptoms, preliminary diagnosis, results of diagnostic studies or 
telephone reports of the studies, treatment provided, results of any 
tests and the informed written consent or certification (or copy 
thereof) required under paragraph (e)(1)(ii) of this section, and the 
name and address of any on-call physician (described in paragraph (g) of 
this section) who has refused or failed to appear within a reasonable 
time to provide necessary stabilizing treatment. Other records (e.g., 
test results not yet available or historical records not readily 
available from the hospital's files) must be sent as soon as practicable 
after transfer; and
    (iv) The transfer is effected through qualified personnel and 
transportation equipment, as required, including the use of necessary 
and medically appropriate life support measures during the transfer.
    (3) A participating hospital may not penalize or take adverse action 
against a physician or a qualified medical person described in paragraph 
(e)(1)(ii)(C) of this section because the physician or qualified medical 
person refuses to authorize the transfer of an individual with an 
emergency medical condition that has not been stabilized, or against any 
hospital employee because the employee reports a violation of a 
requirement of this section.
    (f) Recipient hospital responsibilities. A participating hospital 
that has specialized capabilities or facilities (including, but not 
limited to, facilities such as burn units, shock-trauma units, neonatal 
intensive case units, or, with respect to rural areas, regional referral 
centers (which, for purposes of this subpart, mean hospitals meeting the 
requirements of referral centers found at Sec.  412.96 of this chapter)) 
may not refuse to accept from a referring hospital within the boundaries 
of the United States an appropriate transfer of an individual who 
requires such specialized capabilities or facilities if the receiving 
hospital has the capacity to treat the individual.
    (1) The provisions of this paragraph (f) apply to any participating 
hospital with specialized capabilities, regardless of whether the 
hospital has a dedicated emergency department.
    (2) The provisions of this paragraph (f) do not apply to an 
individual who has been admitted to a referring hospital under the 
provisions of paragraph (d)(2)(i) of this section.
    (g) Termination of provider agreement. If a hospital fails to meet 
the requirements of paragraph (a) through (f) of this section, CMS may 
terminate the provider agreement in accordance with Sec.  489.53.
    (h) Consultation with Quality Improvement Organizations (QIOs)--(1) 
General. Except as provided in paragraph (h)(3) of this section, in 
cases where a medical opinion is necessary to determine a physician's or 
hospital's liability under section 1867(d)(1) of the Act, CMS requests 
the appropriate QIO (with a contract under Part B of title XI of the 
Act) to review the alleged section 1867(d) violation and provide a 
report on its findings in accordance with paragraph (h)(2)(iv) and (v) 
of this section. CMS provides to the QIO all information relevant to the 
case and within its possession or control. CMS, in consultation with the 
OIG, also provides to the QIO a list of relevant questions to which the 
QIO must respond in its report.
    (2) Notice of review and opportunity for discussion and additional 
information. The QIO shall provide the physician and hospital reasonable 
notice of its review, a reasonable opportunity for discussion, and an 
opportunity for the physician and hospital to submit additional 
information before issuing its report. When a QIO receives a request for 
consultation under paragraph (h)(1) of this section, the following 
provisions apply--
    (i) The QIO reviews the case before the 15th calendar day and makes 
its tentative findings.
    (ii) Within 15 calendar days of receiving the case, the QIO gives 
written notice, sent by certified mail, return receipt requested, to the 
physician or the hospital (or both if applicable).

[[Page 485]]

    (iii)(A) The written notice must contain the following information:
    (1) The name of each individual who may have been the subject of the 
alleged violation.
    (2) The date on which each alleged violation occurred.
    (3) An invitation to meet, either by telephone or in person, to 
discuss the case with the QIO, and to submit additional information to 
the QIO within 30 calendar days of receipt of the notice, and a 
statement that these rights will be waived if the invitation is not 
accepted. The QIO must receive the information and hold the meeting 
within the 30-day period.
    (4) A copy of the regulations at 42 CFR 489.24.
    (B) For purposes of paragraph (h)(2)(iii)(A) of this section, the 
date of receipt is presumed to be 5 days after the certified mail date 
on the notice, unless there is a reasonable showing to the contrary.
    (iv) The physician or hospital (or both where applicable) may 
request a meeting with the QIO. This meeting is not designed to be a 
formal adversarial hearing or a mechanism for discovery by the physician 
or hospital. The meeting is intended to afford the physician and/or the 
hospital a full and fair opportunity to present the views of the 
physician and/or hospital regarding the case. The following provisions 
apply to that meeting:
    (A) The physician and/or hospital has the right to have legal 
counsel present during that meeting. However, the QIO may control the 
scope, extent, and manner of any questioning or any other presentation 
by the attorney. The QIO may also have legal counsel present.
    (B) The QIO makes arrangements so that, if requested by CMS or the 
OIG, a verbatim transcript of the meeting may be generated. If CMS or 
OIG requests a transcript, the affected physician and/or the affected 
hospital may request that CMS provide a copy of the transcript.
    (C) The QIO affords the physician and/or the hospital an opportunity 
to present, with the assistance of counsel, expert testimony in either 
oral or written form on the medical issues presented. However, the QIO 
may reasonably limit the number of witnesses and length of such 
testimony if such testimony is irrelevant or repetitive. The physician 
and/or hospital, directly or through counsel, may disclose patient 
records to potential expert witnesses without violating any non-
disclosure requirements set forth in part 476 of this chapter.
    (D) The QIO is not obligated to consider any additional information 
provided by the physician and/or the hospital after the meeting, unless, 
before the end of the meeting, the QIO requests that the physician and/
or hospital submit additional information to support the claims. The QIO 
then allows the physician and/or the hospital an additional period of 
time, not to exceed 5 calendar days from the meeting, to submit the 
relevant information to the QIO.
    (v) Within 60 calendar days of receiving the case, the QIO must 
submit to CMS a report on the QIO's findings. CMS provides copies to the 
OIG and to the affected physician and/or the affected hospital. The 
report must contain the name of the physician and/or the hospital, the 
name of the individual, and the dates and times the individual arrived 
at and was transferred (or discharged) from the hospital. The report 
provides expert medical opinion regarding whether the individual 
involved had an emergency medical condition, whether the individual's 
emergency medical condition was stabilized, whether the individual was 
transferred appropriately, and whether there were any medical 
utilization or quality of care issues involved in the case.
    (vi) The report required under paragraph (h)(2)(v) of this section 
should not state an opinion or conclusion as to whether section 1867 of 
the Act or Sec.  489.24 has been violated.
    (3) If a delay would jeopardize the health or safety of individuals 
or when there was no screening examination, the QIO review described in 
this section is not required before the OIG may impose civil monetary 
penalties or an exclusion in accordance with section 1867(d)(1) of the 
Act and 42 CFR part 1003 of this title.

[[Page 486]]

    (4) If the QIO determines after a preliminary review that there was 
an appropriate medical screening examination and the individual did not 
have an emergency medical condition, as defined by paragraph (b) of this 
section, then the QIO may, at its discretion, return the case to CMS and 
not meet the requirements of paragraph (h) except for those in paragraph 
(h)(2)(v).
    (i) Release of QIO assessments. Upon request, CMS may release a QIO 
assessment to the physician and/or hospital, or the affected individual, 
or his or her representative. The QIO physician's identity is 
confidential unless he or she consents to its release. (See Sec. Sec.  
476.132 and 476.133 of this chapter.)
    (j) Availability of on-call physicians. In accordance with the on-
call list requirements specified in Sec.  489.20(r)(2), a hospital must 
have written policies and procedures in place--
    (1) To respond to situations in which a particular specialty is not 
available or the on-call physician cannot respond because of 
circumstances beyond the physician's control; and
    (2) To provide that emergency services are available to meet the 
needs of individuals with emergency medical conditions if a hospital 
elects to--
    (i) Permit on-call physicians to schedule elective surgery during 
the time that they are on call;
    (ii) Permit on-call physicians to have simultaneous on-call duties; 
and
    (iii) Participate in a formal community call plan. Notwithstanding 
participation in a community call plan, hospitals are still required to 
perform medical screening examinations on individuals who present 
seeking treatment and to conduct appropriate transfers. The formal 
community plan must include the following elements:
    (A) A clear delineation of on-call coverage responsibilities; that 
is, when each hospital participating in the plan is responsible for on-
call coverage.
    (B) A description of the specific geographic area to which the plan 
applies.
    (C) A signature by an appropriate representative of each hospital 
participating in the plan.
    (D) Assurances that any local and regional EMS system protocol 
formally includes information on community on-call arrangements.
    (E) A statement specifying that even if an individual arrives at a 
hospital that is not designated as the on-call hospital, that hospital 
still has an obligation under Sec.  489.24 to provide a medical 
screening examination and stabilizing treatment within its capability, 
and that hospitals participating in the community call plan must abide 
by the regulations under Sec.  489.24 governing appropriate transfers.
    (F) An annual assessment of the community call plan by the 
participating hospitals.

[59 FR 32120, June 22, 1994, as amended at 62 FR 46037, Aug. 29, 1997; 
65 FR 18548, Apr. 7, 2000; 65 FR 59748, Oct. 6, 2000; 66 FR 1599, Jan. 
9, 2001; 66 FR 59923, Nov. 30, 2001; 68 FR 53262, Sept. 9, 2003; 71 FR 
48143, Aug. 18, 2006; 72 FR 47413, Aug. 22, 2007; 73 FR 48758, Aug. 19, 
2008; 74 FR 44001, Aug. 27, 2009]

    Effective Date Note: At 59 FR 32120, June 22, 1994, Sec.  489.24 was 
added. Paragraphs (d) and (g) contain information collection and 
recordkeeping requirements and will not become effective until approval 
has been given by the Office of Management and Budget.



Sec.  489.25  Special requirements concerning CHAMPUS and CHAMPVA programs.

    For inpatient services, a hospital that participates in the Medicare 
program must participate in any health plan contracted under 10 U.S.C. 
1079 or 1086 (Civilian Health and Medical Program of the Uniformed 
Services) and under 38 U.S.C. 613 (Civilian Health and Medical Program 
of the Veterans Administration) and accept the CHAMPUS/CHAMPVA-
determined allowable amount as payment in full, less applicable 
deductible, patient cost-share, and noncovered items. Hospitals must 
meet the requirements of 32 CFR part 199 concerning program benefits 
under the Department of Defense. This section applies to inpatient 
services furnished to beneficiaries admitted on or after January 1, 
1987.

[59 FR 32123, June 22, 1994]



Sec.  489.26  Special requirements concerning veterans.

    For inpatient services, a hospital that participates in the Medicare 
program must admit any veteran whose admission is authorized by the 
Department of Veterans Affairs under 38

[[Page 487]]

U.S.C. 603 and must meet the requirements of 38 CFR part 17 concerning 
admissions practices and payment methodology and amounts. This section 
applies to services furnished to veterans admitted on and after July 1, 
1987.

[59 FR 32123, June 22, 1994]



Sec.  489.27  Beneficiary notice of discharge rights.

    (a) A hospital that participates in the Medicare program must 
furnish each Medicare beneficiary or enrollee, (or an individual acting 
on his or her behalf), timely notice as required by section 
1866(A)(1)(M) of the Act and in accordance with Sec.  405.1205 and Sec.  
422.620. The hospital must be able to demonstrate compliance with this 
requirement.
    (b) Notification by hospitals and other providers. Hospitals and 
other providers (as identified at 489.2(b)) that participate in the 
Medicare program must furnish each Medicare beneficiary, or 
representative, applicable CMS notices in advance of discharge or 
termination of Medicare services, including the notices required under 
Sec.  405.1200, Sec.  405.1202, Sec.  405.1206, and Sec.  422.624 of 
this chapter.

[71 FR 68724, Nov. 27, 2006]



Sec.  489.28  Special capitalization requirements for HHAs.

    (a) Basic rule. An HHA entering the Medicare program on or after 
January 1, 1998, including a new HHA as a result of a change of 
ownership, if the change of ownership results in a new provider number 
being issued, must have available sufficient funds, which we term 
``initial reserve operating funds,'' to operate the HHA for the three 
month period after its Medicare provider agreement becomes effective, 
exclusive of actual or projected accounts receivable from Medicare or 
other health care insurers.
    (b) Standard. Initial reserve operating funds are sufficient to meet 
the requirement of this section if the total amount of such funds is 
equal to or greater than the product of the actual average cost per 
visit of three or more similarly situated HHAs in their first year of 
operation (selected by CMS for comparative purposes) multiplied by the 
number of visits projected by the HHA for its first three months of 
operation--or 22.5 percent (one fourth of 90 percent) of the average 
number of visits reported by the comparison HHAs--whichever is greater.
    (c) Method. CMS, through the intermediary, will determine the amount 
of the initial reserve operating funds using reported cost and visit 
data from submitted cost reports for the first full year of operation 
from at least three HHAs that the intermediary serves that are 
comparable to the HHA that is seeking to enter the Medicare program, 
considering such factors as geographic location and urban/rural status, 
number of visits, provider-based versus free-standing, and proprietary 
versus non-proprietary status. The determination of the adequacy of the 
required initial reserve operating funds is based on the average cost 
per visit of the comparable HHAs, by dividing the sum of total reported 
costs of the HHAs in their first year of operation by the sum of the 
HHAs' total reported visits. The resulting average cost per visit is 
then multiplied by the projected visits for the first three months of 
operation of the HHA seeking to enter the program, but not less than 90 
percent of average visits for a three month period for the HHAs used in 
determining the average cost per visit.
    (d) Required proof of availability of initial reserve operating 
funds. The HHA must provide CMS with adequate proof of the availability 
of initial reserve operating funds. Such proof, at a minimum, will 
include a copy of the statement(s) of the HHA's savings, checking, or 
other account(s) that contains the funds, accompanied by an attestation 
from an officer of the bank or other financial institution that the 
funds are in the account(s) and that the funds are immediately available 
to the HHA. In some cases, an HHA may have all or part of the initial 
reserve operating funds in cash equivalents. For the purpose of this 
section, cash equivalents are short-term, highly liquid investments that 
are readily convertible to known amounts of cash and that present 
insignificant risk of changes in value. A cash equivalent that is not 
readily convertible to a known amount of cash as needed during the 
initial three month period for which the initial reserve operating

[[Page 488]]

funds are required does not qualify in meeting the initial reserve 
operating funds requirement. Examples of cash equivalents for the 
purpose of this section are Treasury bills, commercial paper, and money 
market funds. As with funds in a checking, savings, or other account, 
the HHA also must be able to document the availability of any cash 
equivalents. CMS later may require the HHA to furnish another 
attestation from the financial institution that the funds remain 
available, or, if applicable, documentation from the HHA that any cash 
equivalents remain available, until a date when the HHA will have been 
surveyed by the State agency or by an approved accrediting organization. 
The officer of the HHA who will be certifying the accuracy of the 
information on the HHA's cost report must certify what portion of the 
required initial reserve operating funds is non-borrowed funds, 
including funds invested in the business by the owner. That amount must 
be at least 50 percent of the required initial reserve operating funds. 
The remainder of the reserve operating funds may be secured through 
borrowing or line of credit from an unrelated lender.
    (e) Borrowed funds. If borrowed funds are not in the same account(s) 
as the HHA's own non-borrowed funds, the HHA also must provide proof 
that the borrowed funds are available for use in operating the HHA, by 
providing, at a minimum, a copy of the statement(s) of the HHA's 
savings, checking, or other account(s) containing the borrowed funds, 
accompanied by an attestation from an officer of the bank or other 
financial institution that the funds are in the account(s) and are 
immediately available to the HHA. As with the HHA's own (that is, non-
borrowed) funds, CMS later may require the HHA to establish the current 
availability of such borrowed funds, including furnishing an attestation 
from a financial institution or other source, as may be appropriate, and 
to establish that such funds will remain available until a date when the 
HHA will have been surveyed by the State agency or by an approved 
accrediting organization.
    (f) Line of credit. If the HHA chooses to support the availability 
of a portion of the initial reserve operating funds with a line of 
credit, it must provide CMS with a letter of credit from the lender. CMS 
later may require the HHA to furnish an attestation from the lender that 
the HHA, upon its certification into the Medicare program, continues to 
be approved to borrow the amount specified in the letter of credit.
    (g) Provider agreement. CMS does not enter into a provider agreement 
with an HHA unless the HHA meets the initial reserve operating funds 
requirement of this section.

[63 FR 312, Jan. 5, 1998]



Sec.  489.29  Special requirements concerning beneficiaries served by the Indian Health Service, Tribal health programs, and urban Indian organization health 
          programs.

    (a) Hospitals (as defined in sections 1861(e) and (f) of the Social 
Security Act) and critical access hospitals (as defined in section 
1861(mm)(1) of the Social Security Act) that participate in the Medicare 
program and furnish inpatient hospital services must accept the payment 
methodology and no more than the rates of payment established under 42 
CFR part 136, subpart D as payment in full for the following programs:
    (1) A contract health service (CHS) program under 42 CFR part 136, 
subpart C, of the Indian Health Service (IHS);
    (2) A CHS program under 42 CFR part 136, subpart C, carried out by 
an Indian Tribe or Tribal organization pursuant to the Indian Self-
Determination and Education Assistance Act, as amended, Public Law 93-
638, 25 U.S.C. 450 et seq.; and
    (3) A program funded through a grant or contract by the IHS and 
operated by an urban Indian organization under which items and services 
are purchased for an eligible urban Indian (as those terms are defined 
in 25 U.S.C. 1603 (f) and (h)).
    (b) Hospitals and critical access hospitals may not refuse service 
to an individual on the basis that the payment for such service is 
authorized under programs described in paragraph (a) of this section.

[72 FR 30711, June 4, 2007]

[[Page 489]]



                       Subpart C_Allowable Charges



Sec.  489.30  Allowable charges: Deductibles and coinsurance.

    (a) Part A deductible and coinsurance. The provider may charge the 
beneficiary or other person on his or her behalf:
    (1) The amount of the inpatient hospital deductible or, if less, the 
actual charges for the services;
    (2) The amount of inpatient hospital coinsurance applicable for each 
day the individual is furnished inpatient hospital services after the 
60th day, during a benefit period; and
    (3) The posthospital SNF care coinsurance amount.
    (4) In the case of durable medical equipment (DME) furnished as a 
home health service, 20 percent of the customary charge for the service.
    (b) Part B deductible and coinsurance. (1) The basic allowable 
charges are the $75 deductible and 20 percent of the customary (insofar 
as reasonable) charges in excess of that deductible.
    (2) For hospital outpatient services, the allowable deductible 
charges depend on whether the hospital can determine the beneficiary's 
deductible status.
    (i) If the hospital is unable to determine the deductible status, it 
may charge the beneficiary its full customary charges up to $75.
    (ii) If the beneficiary provides official information as to 
deductible status, the hospital may charge only the unmet portion of the 
deductible.
    (3) In either of the cases discussed in paragraph (b)(2) of this 
section, the hospital is required to file with the intermediary, on a 
form prescribed by CMS, information as to the services, charges, and 
amounts collected.
    (4) The intermediary must reimburse the beneficiary if reimbursement 
is authorized and credit the expenses to the beneficiary's deductible if 
the deductible has not yet been met.
    (5) In the case of DME furnished as a home health service under 
Medicare Part B, the coinsurance is 20 percent of the customary (insofar 
as reasonable) charge for the services, with the following exception: If 
the DME is used DME purchased by or on behalf of the beneficiary at a 
price at least 25 percent less than the reasonable charge for comparable 
new equipment, no coinsurance is required.

[45 FR 22937, Apr. 4, 1980, as amended at 51 FR 41350, Nov. 14, 1986]



Sec.  489.31  Allowable charges: Blood.

    (a) Limitations on charges. (1) A provider may charge the 
beneficiary (or other person on his or her behalf) only for the first 
three pints of blood or units of packed red cells furnished under 
Medicare Part A during a calendar year, or furnished under Medicare Part 
B during a calendar year.
    (2) The charges may not exceed the provider's customary charges.
    (3) The provider may not charge for any whole blood or packed red 
cells in any of the circumstances specified in Sec.  409.87(c)(2) of 
this chapter.
    (b) Offset for excessive charges. If the charge exceeds the cost to 
the provider, that excess will be deducted from any Medicare payments 
due the provider.

[56 FR 23022, May 20, 1991, as amended at 57 FR 36018, Aug. 12, 1992]



Sec.  489.32  Allowable charges: Noncovered and partially covered services.

    (a) Services requested by beneficiary. If services furnished at the 
request of a beneficiary (or his or her representative) are more 
expensive than, or in excess of, services covered under Medicare--
    (1) A provider may charge the beneficiary an amount that does not 
exceed the difference between--
    (i) The provider's customary charges for the services furnished; and
    (ii) The provider's customary charges for the kinds and amounts of 
services that are covered under Medicare.
    (2) A provider may not charge for the services unless they have been 
requested by the beneficiary (or his or her representative) nor require 
a beneficiary to request services as a condition of admission.
    (3) To avoid misunderstanding and disputes, a provider must inform 
any beneficiary who requests a service for which a charge will be made 
that there will be a specified charge for that service.
    (b) Services not requested by the beneficiary. For special 
provisions that

[[Page 490]]

apply when a provider customarily furnishes more expensive services, see 
Sec.  413.35 of this chapter.

[45 FR 22937, Apr. 4, 1980, as amended at 51 FR 34833, Sept. 30, 1986]



Sec.  489.34  Allowable charges: Hospitals participating in State reimbursement control systems or demonstration projects.

    A hospital receiving payment for a covered hospital stay under 
either a State reimbursement control system approved under 1886(c) of 
the Act or a demonstration project authorized under section 402(a) of 
Pub. L. 90-248 (42 U.S.C. 1395b-1) or section 222(a) of Pub. L. 92-603 
(42 U.S.C. 1395b-1 (note)) and that would otherwise be subject to the 
prospective payment system set forth in part 412 of this chapter may 
charge a beneficiary for noncovered services as follows:
    (a) For the custodial care and medically unnecessary services 
described in Sec.  412.42(c) of this chapter, after the conditions of 
Sec.  412.42(c)(1) through (c)(4) are met; and
    (b) For all other services in accordance with the applicable rules 
of this subpart C.

[54 FR 41747, Oct. 11, 1989]



Sec.  489.35  Notice to intermediary.

    The provider must inform its intermediary of any amounts collected 
from a beneficiary or from other persons on his or her behalf.



               Subpart D_Handling of Incorrect Collections



Sec.  489.40  Definition of incorrect collection.

    (a) As used in this subpart, ``incorrect collections'' means any 
amounts collected from a beneficiary (or someone on his or her behalf) 
that are not authorized under subpart C of this part.
    (b) A payment properly made to a provider by an individual not 
considered entitled to Medicare benefits will be deemed to be an 
``incorrect collection'' when the individual is found to be 
retroactively entitled to benefits.



Sec.  489.41  Timing and methods of handling.

    (a) Refund. Prompt refund to the beneficiary or other person is the 
preferred method of handling incorrect collections.
    (b) Setting aside. If the provider cannot refund within 60 days from 
the date on the notice of incorrect collection, it must set aside an 
amount, equal to the amount incorrectly collected, in a separate account 
identified as to the individual to whom the payment is due. This amount 
incorrectly collected must be carried on the provider's records in this 
manner until final disposition is made in accordance with the applicable 
State law.
    (c) Notice to, and action by, intermediary. (1) The provider must 
notify the intermediary of the refund or setting aside required under 
paragraphs (a) and (b) of this section.
    (2) If the provider fails to refund or set aside the required 
amounts, they may be offset against amounts otherwise due the provider.



Sec.  489.42  Payment of offset amounts to beneficiary or other person.

    (a) In order to carry out the commitment to refund amounts 
incorrectly collected, CMS may determine that amounts offset in 
accordance with Sec.  489.41 are to be paid directly to the beneficiary 
or other person from whom the provider received the incorrect 
collection, if:
    (1) CMS finds that the provider has failed, following written 
request, to refund the amount of the incorrect collection to the 
beneficiary or other person; and
    (2) The provider agreement has been terminated in accordance with 
the provisions of subpart E of this part.
    (b) Before making a determination to make payment under paragraph 
(a) of this section, CMS will give written notice to the provider (1) 
explaining that an incorrect collection was made and the amount; (2) 
requesting the provider to refund the incorrect collection to the 
beneficiary or other person; and (3) advising of CMS's intention to make 
a determination under paragraph (a) of this section.

[[Page 491]]

    (c) The notice will afford an authorized official of the provider an 
opportunity to submit, within 20 days from the date on the notice, 
written statement or evidence with respect to the incorrect collection 
and/or offset amounts. CMS will consider any written statement or 
evidence in making a determination.
    (d) Payment to a beneficiary or other person under the provisions of 
paragraph (a) of this section:
    (1) Will not exceed the amount of the incorrect collection; and
    (2) May be considered as payment made to the provider.



 Subpart E_Termination of Agreement and Reinstatement After Termination



Sec.  489.52  Termination by the provider.

    (a) Notice to CMS. (1) A provider that wishes to terminate its 
agreement must send CMS written notice of its intent.
    (2) The notice may state the intended date of termination which must 
be the first day of a month.
    (b) Termination date. (1) If the notice does not specify a date, or 
the date is not acceptable to CMS, CMS may set a date that will not be 
more than 6 months from the date on the provider's notice of intent.
    (2) CMS may accept a termination date that is less than 6 months 
after the date on the provider's notice if it determines that to do so 
would not unduly disrupt services to the community or otherwise 
interfere with the effective and efficient administration of the 
Medicare program.
    (3) A cessation of business is deemed to be a termination by the 
provider, effective with the date on which it stopped providing services 
to the community.
    (c) Public notice. (1) The provider must give notice to the public 
at least 15 days before the effective date of termination.
    (2) The notice must be published in one or more local newspapers and 
must--
    (i) Specify the termination date; and
    (ii) Explain to what extent services may continue after that date, 
in accordance with the exceptions set forth in Sec.  489.55.



Sec.  489.53  Termination by CMS.

    (a) Basis for termination of agreement with any provider. CMS may 
terminate the agreement with any provider if CMS finds that any of the 
following failings is attributable to that provider:
    (1) It is not complying with the provisions of title XVIII and the 
applicable regulations of this chapter or with the provisions of the 
agreement.
    (2) It places restrictions on the persons it will accept for 
treatment and it fails either to exempt Medicare beneficiaries from 
those restrictions or to apply them to Medicare beneficiaries the same 
as to all other persons seeking care.
    (3) It no longer meets the appropriate conditions of participation 
or requirements (for SNFs and NFs) set forth elsewhere in this chapter. 
In the case of an RNHCI no longer meets the conditions for coverage, 
conditions of participation and requirements set forth elsewhere in this 
chapter.
    (4) It fails to furnish information that CMS finds necessary for a 
determination as to whether payments are or were due under Medicare and 
the amounts due.
    (5) It refuses to permit examination of its fiscal or other records 
by, or on behalf of CMS, as necessary for verification of information 
furnished as a basis for payment under Medicare.
    (6) It failed to furnish information on business transactions as 
required in Sec.  420.205 of this chapter.
    (7) It failed at the time the agreement was entered into or renewed 
to disclose information on convicted individuals as required in Sec.  
420.204 of this chapter.
    (8) It failed to furnish ownership information as required in Sec.  
420.206 of this chapter.
    (9) It failed to comply with civil rights requirements set forth in 
45 CFR parts 80, 84, and 90.
    (10) In the case of a hospital or a critical access hospital as 
defined in section 1861(mm)(1) of the Act that has reason to believe it 
may have received an individual transferred by another hospital in 
violation of Sec.  489.24(d), the

[[Page 492]]

hospital failed to report the incident to CMS or the State survey 
agency.
    (11) In the case of a hospital requested to furnish inpatient 
services to CHAMPUS or CHAMPVA beneficiaries or to veterans, it failed 
to comply with Sec.  489.25 or Sec.  489.26, respectively.
    (12) It failed to furnish the notice of discharge rights as required 
by Sec.  489.27.
    (13) It refuses to permit photocopying of any records or other 
information by, or on behalf of CMS, as necessary to determine or verify 
compliance with participation requirements.
    (14) The hospital knowingly and willfully fails to accept, on a 
repeated basis, an amount that approximates the Medicare rate 
established under the inpatient hospital prospective payment system, 
minus any enrollee deductibles or copayments, as payment in full from a 
fee-for-service FEHB plan for inpatient hospital services provided to a 
retired Federal enrollee of a fee-for-service FEHB plan, age 65 or 
older, who does not have Medicare Part A benefits.
    (15) It had its enrollment in the Medicare program revoked in 
accordance to Sec.  424.535 of this chapter.
    (b) Termination of agreements with certain hospitals. In the case of 
a hospital or critical access hospital that has an emergency department, 
as defined in Sec.  489.24(b), CMS may terminate the provider agreement 
if--
    (1) The hospital fails to comply with the requirements of Sec.  
489.24 (a) through (e), which require the hospital to examine, treat, or 
transfer emergency medical condition cases appropriately, and require 
that hospitals with specialized capabilities or facilities accept an 
appropriate transfer; or
    (2) The hospital fails to comply with Sec.  489.20(m), (q), and (r), 
which require the hospital to report suspected violations of Sec.  
489.24(e), to post conspicuously in emergency departments or in a place 
or places likely to be noticed by all individuals entering the emergency 
departments, as well as those individuals waiting for examination and 
treatment in areas other than traditional emergency departments, (that 
is, entrance, admitting area, waiting room, treatment area), signs 
specifying rights of individuals under this subpart, to post 
conspicuously information indicating whether or not the hospital 
participates in the Medicaid program, and to maintain medical and other 
records related to transferred individuals for a period of 5 years, a 
list of on-call physicians for individuals with emergency medical 
conditions, and a central log on each individual who comes to the 
emergency department seeking assistance.
    (16) It has failed to pay a revisit user fee when and if assessed.
    (c) Termination of agreements with hospitals that fail to make 
required disclosures. In the case of a physician-owned hospital, as 
defined at Sec.  489.3, CMS may terminate the provider agreement if the 
hospital failed to comply with the requirements of Sec.  489.20(u) or 
(w). In the case of other participating hospitals, as defined at Sec.  
489.24, CMS may terminate the provider agreement if the participating 
hospital failed to comply with the requirements of Sec.  489.20(w).
    (d) Notice of termination--(1) Timing: Basic rule. Except as 
provided in paragraph (d)(2) of this section, CMS gives the provider 
notice of termination at least 15 days before the effective date of 
termination of the provider agreement.
    (2) Timing exceptions: Immediate jeopardy situations--(i) Hospital 
with emergency department. If CMS finds that a hospital with an 
emergency department is in violation of Sec.  489.24, paragraphs (a) 
through (e), and CMS determines that the violation poses immediate 
jeopardy to the health or safety of individuals who present themselves 
to the hospital for emergency services, CMS--
    (A) Gives the hospital a preliminary notice indicating that its 
provider agreement will be terminated in 23 days if it does not correct 
the identified deficiencies or refute the finding; and
    (B) Gives a final notice of termination, and concurrent notice to 
the public, at least 2 , but not more than 4, days before the effective 
date of termination of the provider agreement.
    (ii) Skilled nursing facilities (SNFs). For an SNF with deficiencies 
that pose immediate jeopardy to the health or safety of residents, CMS 
gives notice at least 2 days before the effective date of termination of 
the provider agreement.

[[Page 493]]

    (3) Content of notice. The notice states the reasons for, and the 
effective date of, the termination, and explains the extent to which 
services may continue after that date, in accordance with Sec.  489.55.
    (4) Notice to public. CMS concurrently gives notice of the 
termination to the public.
    (e) Appeal by the provider. A provider may appeal the termination of 
its provider agreement by CMS in accordance with part 498 of this 
chapter.

[51 FR 24492, July 3, 1986, as amended at 52 FR 22454, June 12, 1987; 54 
FR 5373, Feb. 2, 1989; 56 FR 48879, Sept. 26, 1991; 59 FR 32123, June 
22, 1994; 59 FR 56251, Nov. 10, 1994; 60 FR 45851, Sept. 1, 1995; 60 FR 
50119, Sept. 28, 1995; 62 FR 43937, Aug. 18, 1997; 62 FR 46037, Aug. 29, 
1997; 62 FR 56111, Oct. 29, 1997; 68 FR 66720, Nov. 28, 2003; 69 FR 
49272, Aug. 11, 2004; 71 FR 20781, Apr. 21, 2006; 72 FR 47413, Aug. 22, 
2007; 72 FR 53649, Sept. 19, 2007; 73 FR 48758, Aug. 19, 2008]



Sec.  489.54  Termination by the OIG.

    (a) Basis for termination. (1) The OIG may terminate the agreement 
of any provider if the OIG finds that any of the following failings can 
be attributed to that provider.
    (i) It has knowingly and willfully made, or caused to be made, any 
false statement or representation of a material fact for use in an 
application or request for payment under Medicare.
    (ii) It has submitted, or caused to be submitted, requests for 
Medicare payment of amounts that substantially exceed the costs it 
incurred in furnishing the services for which payment is requested.
    (iii) It has furnished services that the OIG has determined to be 
substantially in excess of the needs of individuals or of a quality that 
fails to meet professionally recognized standards of health care. The 
OIG will not terminate a provider agreement under paragraph (a) if CMS 
has waived a disallowance with respect to the services in question on 
the grounds that the provider and the beneficiary could not reasonably 
be expected to know that payment would not be made. (The rules for 
determining such lack of knowledge are set forth in Sec. Sec.  405.330 
through 405.334 of this chapter.)
    (b) Notice of termination. The OIG will give the provider notice of 
termination at least 15 days before the effective date of termination of 
the agreement, and will concurrently give notice of termination to the 
public.
    (c) Appeal by the provider. A provider may appeal a termination of 
its agreement by the OIG in accordance with subpart O of part 405 of 
this chapter.
    (d) Other applicable rules. The termination of a provider agreement 
by the OIG is subject to the additional procedures specified in 
Sec. Sec.  1001.105 through 1001.109 of this title for notice and 
appeals.

[51 FR 24492, July 3, 1986, as amended at 51 FR 34788, Sept. 30, 1986]



Sec.  489.55  Exceptions to effective date of termination.

    Payment is available for up to 30 days after the effective date of 
termination for--
    (a) Inpatient hospital services (including inpatient psychiatric 
hospital services) and posthospital extended care services furnished to 
a beneficiary who was admitted before the effective date of termination; 
and
    (b) Home health services and hospice care furnished under a plan 
established before the effective date of termination. \1\
---------------------------------------------------------------------------

    \1\ For termination before July 18, 1984, payment was available 
through the calendar year in which the termination was effective.

[50 FR 37376, Sept. 13, 1985]



Sec.  489.57  Reinstatement after termination.

    When a provider agreement has been terminated by CMS under Sec.  
489.53, or by the OIG under Sec.  489.54, a new agreement with that 
provider will not be accepted unless CMS or the OIG, as appropriate, 
finds--
    (a) That the reason for termination of the previous agreement has 
been removed and there is reasonable assurance that it will not recur; 
and
    (b) That the provider has fulfilled, or has made satisfactory 
arrangements to fulfill, all of the statutory and regulatory 
responsibilities of its previous agreement.

[51 FR 24493, July 3, 1986]

[[Page 494]]



               Subpart F_Surety Bond Requirements for HHAs

    Source: 63 FR 313, Jan. 5, 1998, unless otherwise noted.



Sec.  489.60  Definitions.

    As used in this subpart unless the context indicates otherwise--
    Assessment means a sum certain that CMS may assess against an HHA in 
lieu of damages under Titles XI, XVIII, or XXI of the Social Security 
Act or under regulations in this chapter.
    Assets includes but is not limited to any listing that identifies 
Medicare beneficiaries to whom home health services were furnished by a 
participating or formerly participating HHA.
    Civil money penalty means a sum certain that CMS has the authority 
to impose on an HHA as a penalty under Titles XI, XVIII, or XXI of the 
Social Security Act or under regulations in this chapter.
    Participating home health agency means a ``home health agency'' 
(HHA), as that term is defined by section 1861(o) of the Social Security 
Act, that also meets the definition of a ``provider'' set forth at Sec.  
400.202 of this chapter.
    Rider means a notice issued by a Surety that a change in the bond 
has occurred or will occur.
    Surety bond means one or more bonds issued by one or more surety 
companies under 31 U.S.C. 9304 to 9308 and 31 CFR parts 223, 224, and 
225, provided the bond otherwise meets the requirements of this section.
    Unpaid civil money penalty or assessment means a civil money penalty 
or assessment imposed by CMS on an HHA under Titles XI, XVIII, or XXI of 
the Social Security Act, plus accrued interest, that, after the HHA or 
Surety has exhausted all administrative appeals, remains unpaid (because 
the civil money penalty or assessment has not been paid to, or offset or 
compromised by, CMS) and is not the subject of a written arrangement, 
acceptable to CMS, for payment by the HHA. In the event a written 
arrangement for payment, acceptable to CMS, is made, an unpaid civil 
money penalty or assessment also means such civil money penalty or 
assessment, plus accrued interest, that remains due 60 days after the 
HHA's default on such arrangement.
    Unpaid claim means a Medicare overpayment for which the HHA is 
responsible, plus accrued interest, that, 90 days after the date of the 
agency's notice to the HHA of the overpayment, remains due (because the 
overpayment has not been paid to, or recouped or compromised by, CMS) 
and is not the subject of a written arrangement, acceptable to CMS, for 
payment by the HHA. In the event a written arrangement for payment, 
acceptable to CMS, is made, an unpaid claim also means a Medicare 
overpayment for which the HHA is responsible, plus accrued interest, 
that remains due 60 days after the HHA's default on such arrangement.

[63 FR 313, Jan. 5, 1998, as amended at 63 FR 29655, June 1, 1998]



Sec.  489.61  Basic requirement for surety bonds.

    Except as provided in Sec.  489.62, each HHA that is a Medicare 
participating HHA, or that seeks to become a Medicare participating HHA, 
must obtain a surety bond (and furnish to CMS a copy of such surety 
bond) that meets the requirements of this subpart F and CMS's 
instructions.



Sec.  489.62  Requirement waived for Government-operated HHAs.

    An HHA operated by a Federal, State, local, or tribal government 
agency is deemed to have provided CMS with a comparable surety bond 
under State law, and CMS therefore waives the requirements of this 
subpart with respect to such an HHA if, during the preceding 5 years the 
HHA has--
    (a) Not had any unpaid claims or unpaid civil money penalties or 
assessments; and
    (b) Not had any of its claims referred by CMS to the Department of 
Justice or the General Accounting Office in accordance with part 401 of 
this chapter.

[63 FR 313, Jan. 5, 1998, as amended at 63 FR 29655, June 1, 1998]



Sec.  489.63  Parties to the bond.

    The surety bond must name the HHA as Principal, CMS as Obligee, and 
the

[[Page 495]]

surety company (and its heirs, executors, administrators, successors and 
assignees, jointly and severally) as Surety.



Sec.  489.64  Authorized Surety and exclusion of surety companies.

    (a) An HHA may obtain a surety bond required under Sec.  489.61 only 
from an authorized Surety.
    (b) An authorized Surety is a surety company that--
    (1) Has been issued a Certificate of Authority by the U.S. 
Department of the Treasury in accordance with 31 U.S.C. 9304 to 9308 and 
31 CFR parts 223, 224, and 225 as an acceptable surety on Federal bonds 
and the Certificate has neither expired nor been revoked; and
    (2) Has not been determined by CMS to be an unauthorized Surety for 
the purpose of an HHA obtaining a surety bond under this section.
    (c) CMS determines that a surety company is an unauthorized Surety 
under this section--
    (1) If, upon request by CMS, the surety company fails to furnish 
timely confirmation of the issuance of, and the validity and accuracy of 
information appearing on, a surety bond an HHA presents to CMS that 
shows the surety company as Surety on the bond;
    (2) If, upon presentation by CMS to the surety company of a request 
for payment on a surety bond and of sufficient evidence to establish the 
surety company's liability on the bond, the surety company fails to 
timely pay CMS in full the amount requested, up to the face amount of 
the bond; or
    (3) For other good cause.
    (d) Any determination CMS makes under paragraph (c) of this section 
is effective immediately when notice of the determination is published 
in the Federal Register and remains in effect until a notice of 
reinstatement is published in the Federal Register.
    (e) Any determination CMS makes under paragraph (c) of this section 
does not affect the Surety's liability under any surety bond issued by a 
surety company to an HHA before notice of such determination is 
published in accordance with paragraph (d) of this section.
    (f) A determination by CMS that a surety company is an unauthorized 
Surety under this section is not a debarment, suspension, or exclusion 
for the purposes of Executive Order No. 12549 (3 CFR, 1986 comp., p. 
189).



Sec.  489.65  Amount of the bond.

    (a) Basic rule. The amount of the surety bond must be $50,000 or 15 
percent of the Medicare payments made by CMS to the HHA in the HHA's 
most recent fiscal year for which a cost report has been accepted by 
CMS, whichever is greater.
    (b) Computation of the 15 percent: Participating HHA. The 15 percent 
is computed as follows:
    (1) For the initial bond--on the basis of Medicare payments made by 
CMS to the HHA in the HHA's most recent fiscal year as shown in the 
HHA's most recent cost report that has been accepted by CMS. If the 
initial bond will cover less than a full fiscal year, the computation of 
the 15 percent will be based on the number of months of the fiscal year 
that the bond will cover.
    (2) For subsequent bonds--on the basis of Medicare payments made by 
CMS in the most recent fiscal year for which a cost report has been 
accepted. However, if payments in the first six months of the current 
fiscal year differ from such an amount by more than 25 percent, then the 
amount of the bond is 15 percent of such payments projected on an 
annualized basis.
    (c) Computation of 15 percent: An HHA that seeks to become a 
participating HHA by obtaining assets or ownership interest. For an HHA 
that seeks to become a participating HHA by purchasing the assets or the 
ownership interest of a participating or formerly participating HHA, the 
15 percent is computed on the basis of Medicare payments made by CMS to 
the participating or formerly participating HHA in the most recent 
fiscal year that a cost report has been accepted.
    (d) Change of ownership. For an HHA that undergoes a change of 
ownership the 15 percent is computed on the basis of Medicare payments 
made by CMS to the HHA for the most recently accepted cost report.
    (e) An HHA that seeks to become a participating HHA without 
obtaining assets or ownership interest. For an HHA that seeks to become 
a participating HHA

[[Page 496]]

without purchasing the assets or the ownership interest of a 
participating or formerly participating HHA, the 15 percent computation 
does not apply.
    (f) Exception to the basic rule. If an HHA's overpayment in the most 
recently accepted cost report exceeds 15 percent of annual payments, CMS 
may require the HHA to secure a bond in an amount up to or equal to the 
amount of overpayment, provided the amount of the bond is not less than 
$50,000.
    (g) Expiration of the 15 percent provision. For an annual surety 
bond, or for a rider on a continuous surety bond, that is required to be 
submitted on or after June 1, 2005, notwithstanding any reference in 
this subpart to 15 percent as a basis for determining the amount of the 
bond, the amount of the bond or rider, as applicable, must be $50,000 or 
such amount as CMS specifies in accordance with paragraph (f) of this 
section, whichever amount is greater.

[63 FR 313, Jan. 5, 1998, as amended at 63 FR 29655, June 1, 1998]



Sec.  489.66  Additional requirements of the surety bond.

    The surety bond that an HHA obtains under this subpart must meet the 
following additional requirements:
    (a) The bond must guarantee that within 30 days of receiving written 
notice from CMS of an unpaid claim or unpaid civil money penalty or 
assessment, which notice contains sufficient evidence to establish the 
Surety's liability under the bond, the Surety will pay CMS, up to the 
stated amount of the bond--
    (1) The full amount of any unpaid claim, plus accrued interest, for 
which the HHA is responsible; and
    (2) The full amount of any unpaid civil money penalty or assessment 
imposed by CMS on the HHA, plus accrued interest.
    (b) The bond must provide the following:
    (1) The Surety is liable for unpaid claims, unpaid civil money 
penalties, and unpaid assessments that are discovered when the surety 
bond is in effect, regardless of when the payment, overpayment, or other 
event giving rise to the claim, civil money penalty, or assessment 
occurred, provided CMS makes a written demand for payment from the 
Surety during, or within 90 days after, the term of the bond.
    (2) If the HHA fails to furnish a bond meeting the requirements of 
this subpart F for the year following expiration of the term of an 
annual bond, or if the HHA fails to submit a rider when a rider is 
required to be submitted under this subpart, or if the HHA's provider 
agreement is terminated, the last bond or rider, as applicable, 
submitted by the HHA to CMS, which bond or applicable rider meets the 
requirements of this subpart, remains effective and the Surety remains 
liable for unpaid claims, civil money penalties, and assessments that--
    (i) CMS determines or imposes on or asserts against the HHA based on 
overpayments or other events that took place during or prior to the term 
of the last bond or rider; and
    (ii) Were determined or imposed during the 2 years following the 
date the HHA failed to submit a bond or required rider or the date the 
HHA's provider agreement is terminated, whichever is later.
    (c) The bond must provide that the Surety's liability to CMS under 
the bond is not extinguished by any action of the HHA, the Surety, or 
CMS, including but not necessarily limited to any of the following 
actions:
    (1) Action by the HHA or the Surety to terminate or limit the scope 
or term of the bond. The Surety's liability may be extinguished, 
however, when--
    (i) The Surety furnishes CMS with notice of such action not later 
than 10 days after receiving notice from the HHA of action by the HHA to 
terminate or limit the scope of the bond, or not later than 60 days 
before the effective date of such action by the Surety; or
    (ii) The HHA furnishes CMS with a new bond that meets the 
requirements of this subpart.
    (2) The Surety's failure to continue to meet the requirements of 
Sec.  489.64(a) or CMS's determination that the surety company is an 
unauthorized Surety under Sec.  489.64(b).
    (3) Termination of the HHA's provider agreement.
    (4) Any action by CMS to suspend, offset, or otherwise recover 
payments to the HHA.

[[Page 497]]

    (5) Any action by the HHA to--
    (i) Cease operation;
    (ii) Sell or transfer any asset or ownership interest;
    (iii) File for bankruptcy; or
    (iv) Fail to pay the Surety.
    (6) Any fraud, misrepresentation, or negligence by the HHA in 
obtaining the surety bond or by the Surety (or by the Surety's agent, if 
any) in issuing the surety bond, except that any fraud, 
misrepresentation, or negligence by the HHA in identifying to the Surety 
(or to the Surety's agent) the amount of Medicare payments upon which 
the amount of the surety bond is determined will not cause the Surety's 
liability to CMS to exceed the amount of the bond.
    (7) The HHA's failure to exercise available appeal rights under 
Medicare or to assign such rights to the Surety.
    (d) The bond must provide that actions under the bond may be brought 
by CMS or by CMS's fiscal intermediaries.
    (e) The bond must provide the Surety's name, street address or post 
office box number, city, state, and zipcode to which the CMS notice 
provided for in paragraph (a) of this section is to be sent.

[63 FR 313, Jan. 5, 1998, as amended at 63 FR 29655, June 1, 1998]



Sec.  489.67  Term and type of bond.

    (a) Each participating HHA that does not meet the criteria for 
waiver under Sec.  489.62 must submit to CMS in a form as CMS may 
specify, a surety bond for a term beginning January 1, 1998. If an 
annual bond is submitted for the initial term, it must be effective 
through the end of the HHA's current fiscal year.
    (b) Type of bond. The type of bond required to be submitted by an 
HHA under this subpart may be either--
    (1) An annual bond (that is, a bond that specifies an effective 
annual period corresponding to the HHA's fiscal year); or
    (2) A continuous bond (that is, a bond that remains in full force 
and effect from term to term unless it is terminated or canceled as 
provided for in the bond or as otherwise provided by law) that is 
updated by the Surety, via the issuance of a rider, for a particular 
fiscal year for which the bond amount has changed or will change.
    (c) HHA that seeks to become a participating HHA. (1) An HHA that 
seeks to become a participating HHA must submit a surety bond with its 
enrollment application (Form CMS-855, OMB number 0938-0685). The term of 
the initial surety bond must be effective from the effective date of 
provider agreement as specified in Sec.  489.13 of this part. However, 
if the effective date of the provider agreement is less than 30 days 
before the end of the HHA's current fiscal year, the HHA may obtain a 
bond effective through the end of the next fiscal year, provided the 
amount of the bond is the greater of $75,000 or 20 percent of the amount 
determined from the computation specified in Sec.  489.65(c) as 
applicable.
    (2) An HHA that seeks to become a participating HHA through the 
purchase or transfer of assets or ownership interest of a participating 
or formerly participating HHA must also ensure that the surety bond is 
effective from the date of such purchase or transfer.
    (d) Change of ownership. An HHA that undergoes a change of ownership 
must submit the surety bond to CMS not later than the effective date of 
the change of ownership and the bond must be effective from the 
effective date of the change of ownership through the remainder of the 
HHA's fiscal year.
    (e) Government-operated HHA that loses its waiver. A government-
operated HHA that, as of January 1, 1998, meets the criteria for waiver 
under Sec.  489.62 but thereafter is determined by CMS to not meet such 
criteria, must submit a surety bond to CMS within 60 days after it 
receives notice from CMS that it no longer meets the criteria for 
waiver.
    (f) Change of Surety. An HHA that obtains a replacement surety bond 
from a different Surety to cover the remaining term of a previously 
obtained bond must submit the new surety bond to CMS within 30 days of 
obtaining the bond from the new Surety.

(Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395hh))

[63 FR 315, Jan. 5, 1998, as amended at 63 FR 10731, Mar. 4, 1998; 63 FR 
29656, June 1, 1998; 63 FR 41171, July 31, 1998]

[[Page 498]]



Sec.  489.68  Effect of failure to obtain, maintain, and timely file a surety bond.

    (a) The failure of a participating HHA to obtain, file timely, and 
maintain a surety bond in accordance with this subpart F and CMS's 
instructions is sufficient under Sec.  489.53(a)(1) for CMS to terminate 
the HHA's provider agreement.
    (b) The failure of an HHA seeking to become a participating HHA to 
obtain and file timely a surety bond in accordance with this Subpart F 
and CMS's instructions is sufficient under Sec.  489.12(a)(3) for CMS to 
refuse to enter into a provider agreement with the HHA.



Sec.  489.69  Evidence of compliance.

    (a) CMS may at any time require an HHA to make a specific showing of 
being in compliance with the requirements of this Subpart F and may 
require the HHA to submit such additional evidence as CMS considers 
sufficient to demonstrate the HHA's compliance.
    (b) If requested by CMS to do so, the failure of an HHA to timely 
furnish sufficient evidence to CMS to demonstrate compliance with the 
requirements of this Subpart F is sufficient for CMS to terminate the 
HHA's provider agreement under Sec.  489.53(a)(1) or to refuse to enter 
into a provider agreement with the HHA under Sec.  489.12(a)(3), as 
applicable.



Sec.  489.70  Effect of payment by the Surety.

    A Surety's payment to CMS under a bond for an unpaid claim or an 
unpaid civil money penalty or assessment, constitutes--
    (a) Collection of the unpaid claim or unpaid civil money penalty or 
assessment (to the extent the Surety's payment on the bond covers such 
unpaid claim, civil money penalty, or assessment); and
    (b) A basis for termination of the HHA's provider agreement under 
Sec.  489.53(a)(1).



Sec.  489.71  Surety's standing to appeal Medicare determinations.

    A Surety has standing to appeal any matter that the HHA could 
appeal, provided the Surety satisfies all jurisdictional and procedural 
requirements that would otherwise have applied to the HHA, and provided 
the HHA is not, itself, actively pursuing its appeal rights under this 
chapter, and provided further that, with respect to unpaid claims, the 
Surety has paid CMS all amounts owed to CMS by the HHA on such unpaid 
claims, up to the amount of the bond.

[63 FR 29656, June 1, 1998]



Sec.  489.72  Effect of review reversing determination.

    In the event a Surety has paid CMS on the basis of liability 
incurred under a bond obtained by an HHA under this subpart F, and to 
the extent the HHA that obtained such bond (or the Surety under Sec.  
489.71) is subsequently successful in appealing the determination that 
was the basis of the unpaid claim or unpaid civil money penalty or 
assessment that caused the Surety to pay CMS under the bond, CMS will 
refund to the Surety the amount the Surety paid to CMS to the extent 
such amount relates to the matter that was successfully appealed by the 
HHA (or by the Surety), provided all review, including judicial review, 
has been completed on such matter. Any additional amounts owing as a 
result of the appeal will be paid to the HHA.



Sec.  489.73  Effect of conditions of payment.

    If a Surety has paid an amount to CMS on the basis of liability 
incurred under a bond obtained by an HHA under this subpart F, and CMS 
subsequently collects from the HHA, in whole or in part, on such unpaid 
claim, civil money penalty, or assessment that was the basis for the 
Surety's liability, CMS reimburses the Surety such amount as CMS 
collected from the HHA, up to the amount paid by the Surety to CMS, 
provided the Surety has no other liability to CMS under the bond.

(Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395hh))

[63 FR 29656, June 1, 1998]

[[Page 499]]



Sec.  489.74  Incorporation into existing provider agreements.

    The requirements of this subpart F are deemed to be incorporated 
into existing HHA provider agreements effective January 1, 1998.

[63 FR 315, Jan. 5, 1998. Redesignated at 63 FR 29656, June 1, 1998]

Subparts G-H [Reserved]



                      Subpart I_Advance Directives

    Source: 57 FR 8203, Mar. 6, 1992, unless otherwise noted.



Sec.  489.100  Definition.

    For purposes of this part, advance directive means a written 
instruction, such as a living will or durable power of attorney for 
health care, recognized under State law (whether statutory or as 
recognized by the courts of the State), relating to the provision of 
health care when the individual is incapacitated.



Sec.  489.102  Requirements for providers.

    (a) Hospitals, critical access hospitals, skilled nursing 
facilities, nursing facilities, home health agencies, providers of home 
health care (and for Medicaid purposes, providers of personal care 
services), hospices, and religious nonmedical health care institutions 
must maintain written policies and procedures concerning advance 
directives with respect to all adult individuals receiving medical care, 
or patient care in the case of a patient in a religious nonmedical 
health care institution, by or through the provider and are required to:
    (1) Provide written information to such individuals concerning--
    (i) An individual's rights under State law (whether statutory or 
recognized by the courts of the State) to make decisions concerning such 
medical care, including the right to accept or refuse medical or 
surgical treatment and the right to formulate, at the individual's 
option, advance directives. Providers are permitted to contract with 
other entities to furnish this information but are still legally 
responsible for ensuring that the requirements of this section are met. 
Providers are to update and disseminate amended information as soon as 
possible, but no later than 90 days from the effective date of the 
changes to State law; and
    (ii) The written policies of the provider or organization respecting 
the implementation of such rights, including a clear and precise 
statement of limitation if the provider cannot implement an advance 
directive on the basis of conscience. At a minimum, a provider's 
statement of limitation should:
    (A) Clarify any differences between institution-wide conscience 
objections and those that may be raised by individual physicians;
    (B) Identify the state legal authority permitting such objection; 
and
    (C) Describe the range of medical conditions or procedures affected 
by the conscience objection.
    (2) Document in a prominent part of the individual's current medical 
record, or patient care record in the case of an individual in a 
religious nonmedical health care institution, whether or not the 
individual has executed an advance directive;
    (3) Not condition the provision of care or otherwise discriminate 
against an individual based on whether or not the individual has 
executed an advance directive;
    (4) Ensure compliance with requirements of State law (whether 
statutory or recognized by the courts of the State) regarding advance 
directives. The provider must inform individuals that complaints 
concerning the advance directive requirements may be filed with the 
State survey and certification agency;
    (5) Provide for education of staff concerning its policies and 
procedures on advance directives; and
    (6) Provide for community education regarding issues concerning 
advance directives that may include material required in paragraph 
(a)(1) of this section, either directly or in concert with other 
providers and organizations. Separate community education materials may 
be developed and used, at the discretion of providers. The same written 
materials do not have to be provided in all settings, but the material 
should define what constitutes an advance directive, emphasizing that an 
advance

[[Page 500]]

directive is designed to enhance an incapacitated individual's control 
over medical treatment, and describe applicable State law concerning 
advance directives. A provider must be able to document its community 
education efforts.
    (b) The information specified in paragraph (a) of this section is 
furnished:
    (1) In the case of a hospital, at the time of the individual's 
admission as an inpatient.
    (2) In the case of a skilled nursing facility at the time of the 
individual's admission as a resident.
    (3)(i) In the case of a home health agency, in advance of the 
individual coming under the care of the agency. The HHA may furnish 
advance directives information to a patient at the time of the first 
home visit, as long as the information is furnished before care is 
provided.
    (ii) In the case of personal care services, in advance of the 
individual coming under the care of the personal care services provider. 
The personal care provider may furnish advance directives information to 
a patient at the time of the first home visit, as long as the 
information is furnished before care is provided.
    (4) In the case of a hospice program, at the time of initial receipt 
of hospice care by the individual from the program.
    (c) The providers listed in paragraph (a) of this section--
    (1) Are not required to provide care that conflicts with an advance 
directive.
    (2) Are not required to implement an advance directive if, as a 
matter of conscience, the provider cannot implement an advance directive 
and State law allows any health care provider or any agent of such 
provider to conscientiously object.
    (d) Prepaid or eligible organizations (as specified in sections 
1833(a)(1)(A) and 1876(b) of the Act) must meet the requirements 
specified in Sec.  417.436 of this chapter.
    (e) If an adult individual is incapacitated at the time of admission 
or at the start of care and is unable to receive information (due to the 
incapacitating conditions or a mental disorder) or articulate whether or 
not he or she has executed an advance directive, then the provider may 
give advance directive information to the individual's family or 
surrogate in the same manner that it issues other materials about 
policies and procedures to the family of the incapacitated individual or 
to a surrogate or other concerned persons in accordance with State law. 
The provider is not relieved of its obligation to provide this 
information to the individual once he or she is no longer incapacitated 
or unable to receive such information. Follow-up procedures must be in 
place to provide the information to the individual directly at the 
appropriate time.

[57 FR 8203, Mar. 6, 1992, as amended at 59 FR 45403, Sept. 1, 1994; 60 
FR 33294, June 27, 1995; 62 FR 46037, Aug. 29, 1997; 64 FR 67052, Nov. 
30, 1999; 68 FR 66720, Nov. 28, 2003]



Sec.  489.104  Effective dates.

    These provisions apply to services furnished on or after December 1, 
1991 payments made under section 1833(a)(1)(A) of the Act on or after 
December 1, 1991, and contracts effective on or after December 1, 1991.



PART 491_CERTIFICATION OF CERTAIN HEALTH FACILITIES--Table of Contents




Subpart A_Rural Health Clinics: Conditions for Certification; and FQHCs 
                         Conditions for Coverage

Sec.
491.1 Purpose and scope.
491.2 Definitions.
491.3 Certification procedures.
491.4 Compliance with Federal, State and local laws.
491.5 Location of clinic.
491.6 Physical plant and environment.
491.7 Organizational structure.
491.8 Staffing and staff responsibilities.
491.9 Provision of services.
491.10 Patient health records.
491.11 Program evaluation.

    Authority: Sec. 1102 of the Social Security Act (42 U.S.C. 1302); 
and sec. 353 of the Public Health Service Act (42 U.S.C. 263a).

[[Page 501]]



Subpart A_Rural Health Clinics: Conditions for Certification; and FQHCs 
                         Conditions for Coverage



Sec.  491.1  Purpose and scope.

    This subpart sets forth the conditions that rural health clinics or 
FQHCs must meet in order to qualify for reimbursement under Medicare 
(title XVIII of the Social Security Act) and that rural health clinics 
must meet in order to qualify for reimbursement under Medicaid (title 
XIX of the Act).

[57 FR 24982, June 12, 1992]



Sec.  491.2  Definitions.

    As used in this subpart, unless the context indicates otherwise:
    Direct services means services provided by the clinic's staff.
    FQHC means an entity as defined in Sec.  405.2401(b).
    Nurse practitioner means a registered professional nurse who is 
currently licensed to practice in the State, who meets the State's 
requirements governing the qualifications of nurse practitioners, and 
who meets one of the following conditions:
    (1) Is currently certified as a primary care nurse practitioner by 
the American Nurses' Association or by the National Board of Pediatric 
Nurse Practitioners and Associates; or
    (2) Has satisfactorily completed a formal 1 academic year 
educational program that:
    (i) Prepares registered nurses to perform an expanded role in the 
delivery of primary care;
    (ii) Includes at least 4 months (in the aggregate) of classroom 
instruction and a component of supervised clinical practice; and
    (iii) Awards a degree, diploma, or certificate to persons who 
successfully complete the program; or
    (3) Has successfully completed a formal educational program (for 
preparing registered nurses to perform an expanded role in the delivery 
of primary care) that does not meet the requirements of paragraph (2) of 
this definition, and has been performing an expanded role in the 
delivery of primary care for a total of 12 months during the 18-month 
period immediately preceding the effective date of this subpart.
    Physician means a doctor of medicine or osteopathy legally 
authorized to practice medicine or surgery in the State.
    Physician assistant means a person who meets the applicable State 
requirements governing the qualifications for assistants to primary care 
physicians, and who meets at least one of the following conditions:
    (1) Is currently certified by the National Commission on 
Certification of Physician Assistants to assist primary care physicians; 
or
    (2) Has satisfactorily completed a program for preparing physician's 
assistants that:
    (i) Was at least 1 academic year in length;
    (ii) Consisted of supervised clinical practice and at least 4 months 
(in the aggregate) of classroom instruction directed toward preparing 
students to deliver health care; and
    (iii) Was accredited by the American Medical Association's Committee 
on Allied Health Education and Accreditation; or
    (3) Has satisfactorily completed a formal educational program (for 
preparing physician assistants) that does not meet the requirements of 
paragraph (2) of this definition and assisted primary care physicians 
for a total of 12 months during the 18-month period that ended on 
December 31, 1986.
    Rural area means an area that is not delineated as an urbanized area 
by the Bureau of the Census.
    Rural health clinic or clinic means a clinic that is located in a 
rural area designated as a shortage area, is not a rehabilitation agency 
or a facility primarily for the care and treatment of mental diseases, 
and meets all other requirements of this subpart.
    Shortage area means a defined geographic area designated by the 
Department as having either a shortage of personal health services 
(under section 1302(7) of the Public Health Service Act) or a shortage 
of primary medical care manpower (under section 332 of that Act).

[[Page 502]]

    Secretary means the Secretary of Health and Human Services, or any 
official to whom he has delegated the pertinent authority.

[71 FR 55345, Sept. 22, 2006]



Sec.  491.3  Certification procedures.

    A rural health clinic will be certified for participation in 
Medicare in accordance with subpart S of 42 CFR part 405. The Secretary 
will notify the State Medicaid agency whenever he has certified or 
denied certification under Medicare for a prospective rural health 
clinic in that State. A clinic certified under Medicare will be deemed 
to meet the standards for certification under Medicaid.

[71 FR 55346, Sept. 22, 2006]



Sec.  491.4  Compliance with Federal, State and local laws.

    The rural health clinic or FQHC and its staff are in compliance with 
applicable Federal, State and local laws and regulations.
    (a) Licensure of clinic or center. The clinic or center is licensed 
pursuant to applicable State and local law.
    (b) Licensure, certification or registration of personnel. Staff of 
the clinic or center are licensed, certified or registered in accordance 
with applicable State and local laws.

[57 FR 24982, June 12, 1992]



Sec.  491.5  Location of clinic.

    (a) Basic requirements. (1) An RHC is located in a rural area that 
is designated as a shortage area.
    (2) An FQHC is located in a rural or urban area that is designated 
as either a shortage area or an area that has a medically underserved 
population.
    (3) Both the RHC and the FQHC may be permanent or mobile units.
    (i) Permanent unit. The objects, equipment, and supplies necessary 
for the provision of the services furnished directly by the clinic or 
center are housed in a permanent structure.
    (ii) Mobile unit. The objects, equipment, and supplies necessary for 
the provision of the services furnished directly by the clinic or center 
are housed in a mobile structure, which has fixed, scheduled 
location(s).
    (iii) Permanent unit in more than one location. If clinic or center 
services are furnished at permanent units in more than one location, 
each unit is independently considered for approval as a rural health 
clinic or for approval as an FQHC.
    (b) Exceptions. (1) CMS does not disqualify an RHC approved under 
this subpart if the area in which it is located subsequently fails to 
meet the definition of a rural, shortage area.
    (2) A private, nonprofit facility that meets all other conditions of 
this subpart except for location in a shortage area will be certified 
if, on July 1, 1977, it was operating in a rural area that is determined 
by the Secretary (on the basis of the ratio of primary care physicians 
to the general population) to have an insufficient supply of physicians 
to meet the needs of the area served.
    (3) Determinations on these exceptions will be made by the Secretary 
upon application by the facility.
    (c) Criteria for designation of rural areas. (1) Rural areas are 
areas not delineated as urbanized areas in the last census conducted by 
the Census Bureau.
    (2) Excluded from the rural area classification are:
    (i) Central cities of 50,000 inhabitants or more;
    (ii) Cities with at least 25,000 inhabitants which, together with 
contiguous areas having stipulated population density, have combined 
populations of 50,000 and constitute, for general economic and social 
purposes, single communities;
    (iii) Closely settled territories surrounding cities and 
specifically designated by the Census Bureau as urban.
    (3) Included in the rural area classification are those portions of 
extended cities that the Census Bureau has determined to be rural.
    (d) Criteria for designation of shortage areas. (1) The criteria for 
determination of shortage of personal health services (under section 
1302(7) of the Public Health Services Act), are:
    (i) The ratio of primary care physicians practicing within the area 
to the resident population;
    (ii) The infant mortality rate;

[[Page 503]]

    (iii) The percent of the population 65 years of age or older; and
    (iv) The percent of the population with a family income below the 
poverty level.
    (2) The criteria for determination of shortage of primary medical 
care manpower (under section 332(a)(1)(A) of the Public Health Services 
Act) are:
    (i) The area served is a rational area for the delivery of primary 
medical care services;
    (ii) The ratio of primary care physicians practicing within the area 
to the resident population; and
    (iii) The primary medical care manpower in contiguous areas is 
overutilized, excessively distant, or inaccessible to the population in 
this area.
    (e) Medically underserved population. A medically underserved 
population includes the following:
    (1) A population of an urban or rural area that is designated by PHS 
as having a shortage of personal health services.
    (2) A population group that is designated by PHS as having a 
shortage of personal health services.
    (f) Requirements specific to FQHCs. An FQHC approved for 
participation in Medicare must meet one of the following criteria:
    (1) Furnish services to a medically underserved population.
    (2) Be located in a medically underserved area, as demonstrated by 
an application approved by PHS.

    Cross Reference: See 42 CFR 110.203(g) (41 FR 45718, Oct. 15, 1976) 
and 42 CFR Part 5 (42 FR 1586, Jan. 10, 1978).

[43 FR 5375, Feb. 8, 1978. Redesignated at 50 FR 33034, Aug. 16, 1985, 
and amended at 57 FR 24982, June 12, 1992; 61 FR 14658, Apr. 3, 1996; 68 
FR 74816, Dec. 24, 2003; 71 FR 55346, Sept. 22, 2006]



Sec.  491.6  Physical plant and environment.

    (a) Construction. The clinic or center is constructed, arranged, and 
maintained to insure access to and safety of patients, and provides 
adequate space for the provision of direct services.
    (b) Maintenance. The clinic or center has a preventive maintenance 
program to ensure that:
    (1) All essential mechanical, electrical and patient-care equipment 
is maintained in safe operating condition;
    (2) Drugs and biologicals are appropriately stored; and
    (3) The premises are clean and orderly.
    (c) Emergency procedures. The clinic or center assures the safety of 
patients in case of non-medical emergencies by:
    (1) Training staff in handling emergencies;
    (2) Placing exit signs in appropriate locations; and
    (3) Taking other appropriate measures that are consistent with the 
particular conditions of the area in which the clinic or center is 
located.

[57 FR 24983, June 12, 1992]



Sec.  491.7  Organizational structure.

    (a) Basic requirements. (1) The clinic or center is under the 
medical direction of a physician, and has a health care staff that meets 
the requirements of Sec.  491.8.
    (2) The organization's policies and its lines of authority and 
responsibilities are clearly set forth in writing.
    (b) Disclosure. The clinic or center discloses the names and 
addresses of:
    (1) Its owners, in accordance with section 1124 of the Social 
Security Act (42 U.S.C. 132 A-3);
    (2) The person principally responsible for directing the operation 
of the clinic or center; and
    (3) The person responsible for medical direction.

[57 FR 24983, June 12, 1992]



Sec.  491.8  Staffing and staff responsibilities.

    (a) Staffing. (1) The clinic or center has a health care staff that 
includes one or more physicians. Rural health clinic staffs must also 
include one or more physician's assistants or nurse practitioners.
    (2) The physician member of the staff may be the owner of the rural 
health clinic, an employee of the clinic or center, or under agreement 
with the clinic or center to carry out the responsibilities required 
under this section.
    (3) The physician assistant, nurse practitioner, nurse-midwife, 
clinical social worker, or clinical psychologist

[[Page 504]]

member of the staff may be the owner or an employee of the clinic or 
center, or may furnish services under contract to the center.
    (4) The staff may also include ancillary personnel who are 
supervised by the professional staff.
    (5) The staff is sufficient to provide the services essential to the 
operation of the clinic or center.
    (6) A physician, nurse practitioner, physician assistant, nurse-
midwife, clinical social worker, or clinical psychologist is available 
to furnish patient care services at all times the clinic or center 
operates. In addition, for rural health clinics, a nurse practitioner or 
a physician assistant is available to furnish patient care services at 
least 60 percent of the time the clinic operates.
    (b) Physician responsibilities. (1) The physician:
    (i) Except for services furnished by a clinical psychologist in an 
FQHC, which State law permits to be provided without physician 
supervision, provides medical direction for the clinic's or center's 
health care activities and consultation for, and medical supervision of, 
the health care staff.
    (ii) In conjunction with the physician's assistant and/or nurse 
practitioner member(s), participates in developing, executing, and 
periodically reviewing the clinic's or center's written policies and the 
services provided to Federal program patients; and
    (iii) Periodically reviews the clinic's or center's patient records, 
provides medical orders, and provides medical care services to the 
patients of the clinic or center.
    (2) A physician is present for sufficient periods of time, at least 
once in every 2 week period (except in extraordinary circumstances), to 
provide the medical direction, medical care services, consultation and 
supervision described in paragraph (b)(1) of this section and is 
available through direct telecommunication for consultation, assistance 
with medical emergencies, or patient referral. The extraordinary 
circumstances are documented in the records of the clinic or center.
    (c) Physician assistant and nurse practitioner responsibilities. (1) 
The physician assistant and the nurse practitioner members of the 
clinic's or center's staff:
    (i) Participate in the development, execution and periodic review of 
the written policies governing the services the clinic or center 
furnishes;
    (ii) Participate with a physician in a periodic review of the 
patients' health records.
    (2) The physician assistant or nurse practitioner performs the 
following functions, to the extent they are not being performed by a 
physician:
    (i) Provides services in accordance with the clinic's or center's 
policies;
    (ii) Arranges for, or refers patients to, needed services that 
cannot be provided at the clinic or center; and
    (iii) Assures that adequate patient health records are maintained 
and transferred as required when patients are referred.

[57 FR 24983, June 12, 1992, as amended at 61 FR 14658, Apr. 3, 1996; 68 
FR 74817, Dec. 24, 2003; 71 FR 55346, Sept. 22, 2006]



Sec.  491.9  Provision of services.

    (a) Basic requirements. (1) All services offered by the clinic or 
center are furnished in accordance with applicable Federal, State, and 
local laws; and
    (2) The clinic or center is primarily engaged in providing 
outpatient health services and meets all other conditions of this 
subpart.
    (3) The laboratory requirements in paragraph (c)(2) of this section 
apply to RHCs, but do not apply to FQHCs.
    (b) Patient care policies. (1) The clinic's or center's health care 
services are furnished in accordance with appropriate written policies 
which are consistent with applicable State law.
    (2) The policies are developed with the advice of a group of 
professional personnel that includes one or more physicians and one or 
more physician assistants or nurse practitioners. At least one member is 
not a member of the clinic or center staff.
    (3) The policies include:
    (i) A description of the services the clinic or center furnishes 
directly and those furnished through agreement or arrangement.
    (ii) Guidelines for the medical management of health problems which 
include the conditions requiring medical consultation and/or patient 
referral,

[[Page 505]]

the maintenance of health care records, and procedures for the periodic 
review and evaluation of the services furnished by the clinic or center.
    (iii) Rules for the storage, handling, and administration of drugs 
and biologicals.
    (4) These policies are reviewed at least annually by the group of 
professional personnel required under paragraph (b)(2) of this section 
and reviewed as necessary by the clinic or center.
    (c) Direct services--(1) General. The clinic or center staff 
furnishes those diagnostic and therapeutic services and supplies that 
are commonly furnished in a physician's office or at the entry point 
into the health care delivery system. These include medical history, 
physical examination, assessment of health status, and treatment for a 
variety of medical conditions.
    (2) Laboratory. These requirements apply to RHCs but not to FQHCs. 
The RHC provides laboratory services in accordance with part 493 of this 
chapter, which implements the provisions of section 353 of the Public 
Health Service Act. The RHC provides basic laboratory services essential 
to the immediate diagnosis and treatment of the patient, including:
    (i) Chemical examinations of urine by stick or tablet method or both 
(including urine ketones);
    (ii) Hemoglobin or hematocrit;
    (iii) Blood glucose;
    (iv) Examination of stool specimens for occult blood;
    (v) Pregnancy tests; and
    (vi) Primary culturing for transmittal to a certified laboratory.
    (3) Emergency. The clinic or center provides medical emergency 
procedures as a first response to common life-threatening injuries and 
acute illness and has available the drugs and biologicals commonly used 
in life saving procedures, such as analgesics, anesthetics (local), 
antibiotics, anticonvulsants, antidotes and emetics, serums and toxoids.
    (d) Services provided through agreements or arrangements. (1) The 
clinic or center has agreements or arrangements with one or more 
providers or suppliers participating under Medicare or Medicaid to 
furnish other services to its patients, including:
    (i) Inpatient hospital care;
    (ii) Physician(s) services (whether furnished in the hospital, the 
office, the patient's home, a skilled nursing facility, or elsewhere); 
and
    (iii) Additional and specialized diagnostic and laboratory services 
that are not available at the clinic or center.
    (2) If the agreements are not in writing, there is evidence that 
patients referred by the clinic or center are being accepted and 
treated.

[57 FR 24983, June 12, 1992, as amended at 58 FR 63536, Dec. 2, 1993]



Sec.  491.10  Patient health records.

    (a) Records system. (1) The clinic or center maintains a clinical 
record system in accordance with written policies and procedures.
    (2) A designated member of the professional staff is responsible for 
maintaining the records and for insuring that they are completely and 
accurately documented, readily accessible, and systematically organized.
    (3) For each patient receiving health care services, the clinic or 
center maintains a record that includes, as applicable:
    (i) Identification and social data, evidence of consent forms, 
pertinent medical history, assessment of the health status and health 
care needs of the patient, and a brief summary of the episode, 
disposition, and instructions to the patient;
    (ii) Reports of physical examinations, diagnostic and laboratory 
test results, and consultative findings;
    (iii) All physician's orders, reports of treatments and medications, 
and other pertinent information necessary to monitor the patient's 
progress;
    (iv) Signatures of the physician or other health care professional.
    (b) Protection of record information. (1) The clinic or center 
maintains the confidentiality of record information and provides 
safeguards against loss, destruction or unauthorized use.
    (2) Written policies and procedures govern the use and removal of 
records from the clinic or center and the conditions for release of 
information.
    (3) The patient's written consent is required for release of 
information not

[[Page 506]]

authorized to be released without such consent.
    (c) Retention of records. The records are retained for at least 6 
years from date of last entry, and longer if required by State statute.

(Secs. 1102, 1833 and 1902(a)(13), Social Security Act; 49 Stat. 647, 91 
Stat. 1485 (42 U.S.C. 1302, 13951 and 1396a(a)(13)))

[43 FR 30529, July 14, 1978. Redesignated at 50 FR 33034, Aug. 16, 1985, 
as amended at 57 FR 24984, June 12, 1992]



Sec.  491.11  Program evaluation.

    (a) The clinic or center carries out, or arranges for, an annual 
evaluation of its total program.
    (b) The evaluation includes review of:
    (1) The utilization of clinic or center services, including at least 
the number of patients served and the volume of services;
    (2) A representative sample of both active and closed clinical 
records; and
    (3) The clinic's or center's health care policies.
    (c) The purpose of the evaluation is to determine whether:
    (1) The utilization of services was appropriate;
    (2) The established policies were followed; and
    (3) Any changes are needed.
    (d) The clinic or center staff considers the findings of the 
evaluation and takes corrective action if necessary.

[71 FR 55346, Sept. 22, 2006]



PART 493_LABORATORY REQUIREMENTS--Table of Contents




                      Subpart A_General Provisions

Sec.
493.1 Basis and scope.
493.2 Definitions.
493.3 Applicability.
493.5 Categories of tests by complexity.
493.15 Laboratories performing waived tests.
493.17 Test categorization.
493.19 Provider-performed microscopy (PPM) procedures.
493.20 Laboratories performing tests of moderate complexity.
493.25 Laboratories performing tests of high complexity.

                     Subpart B_Certificate of Waiver

493.35 Application for a certificate of waiver.
493.37 Requirements for a certificate of waiver.
493.39 Notification requirements for laboratories issued a certificate 
          of waiver.

 Subpart C_Registration Certificate, Certificate for Provider-performed 
          Microscopy Procedures, and Certificate of Compliance

493.43 Application for registration certificate, certificate for 
          provider-performed microscopy (PPM) procedures, and 
          certificate of compliance.
493.45 Requirements for a registration certificate.
493.47 Requirements for a certificate for provider-performed microscopy 
          (PPM) procedures.
493.49 Requirements for a certificate of compliance.
493.51 Notification requirements for laboratories issued a certificate 
          of compliance.
493.53 Notification requirements for laboratories issued a certificate 
          for provider-performed microscopy (PPM) procedures.

                 Subpart D_Certificate of Accreditation

493.55 Application for registration certificate and certificate of 
          accreditation.
493.57 Requirements for a registration certificate.
493.61 Requirements for a certificate of accreditation.
493.63 Notification requirements for laboratories issued a certificate 
          of accreditation.

     Subpart E_Accreditation by a Private, Nonprofit Accreditation 
  Organization or Exemption Under an Approved State Laboratory Program

493.551 General requirements for laboratories.
493.553 Approval process (application and reapplication) for 
          accreditation organizations and State licensure programs.
493.555 Federal review of laboratory requirements.
493.557 Additional submission requirements.
493.559 Publication of approval of deeming authority or CLIA exemption.
493.561 Denial of application or reapplication.
493.563 Validation inspections--Basis and focus.
493.565 Selection for validation inspection--laboratory 
          responsibilities.
493.567 Refusal to cooperate with validation inspection.

[[Page 507]]

493.569 Consequences of a finding of noncompliance as a result of a 
          validation inspection.
493.571 Disclosure of accreditation, State and CMS validation inspection 
          results.
493.573 Continuing Federal oversight of private nonprofit accreditation 
          organizations and approved State licensure programs.
493.575 Removal of deeming authority or CLIA exemption and final 
          determination review.

                    Subpart F_General Administration

493.602 Scope of subpart.
493.606 Applicability of subpart.
493.638 Certificate fees.
493.639 Fee for revised certificate.
493.643 Fee for determination of program compliance.
493.645 Additional fee(s) applicable to approved State laboratory 
          programs and laboratories issued a certificate of 
          accreditation, certificate of waiver, or certificate for PPM 
          procedures.
493.646 Payment of fees.
493.649 Methodology for determining fee amount.

Subpart G [Reserved]

    Subpart H_Participation in Proficiency Testing for Laboratories 
                      Performing Nonwaived Testing

493.801 Condition: Enrollment and testing of samples.
493.803 Condition: Successful participation.
493.807 Condition: Reinstatement of laboratories performing nonwaived 
          testing.

   Proficiency Testing by Specialty and Subspecialty for Laboratories 
  Performing Tests of Moderate Complexity (Including the Subcategory), 
           High Complexity, or Any Combination of These Tests

493.821 Condition: Microbiology.
493.823 Standard; Bacteriology.
493.825 Standard; Mycobacteriology.
493.827 Standard; Mycology.
493.829 Standard; Parasitology.
493.831 Standard; Virology.
493.833 Condition: Diagnostic immunology.
493.835 Standard; Syphilis serology.
493.837 Standard; General immunology.
493.839 Condition: Chemistry.
493.841 Standard; Routine chemistry.
493.843 Standard; Endocrinology.
493.845 Standard; Toxicology.
493.849 Condition: Hematology.
493.851 Standard; Hematology.
493.853 Condition: Pathology.
493.855 Standard; Cytology: gynecologic examinations.
493.857 Condition: Immunohematology.
493.859 Standard; ABO group and D (Rho) typing.
493.861 Standard; Unexpected antibody detection.
493.863 Standard; Compatibility testing.
493.865 Standard; Antibody identification.

      Subpart I_Proficiency Testing Programs for Nonwaived Testing

493.901 Approval of proficiency testing programs.
493.903 Administrative responsibilities.
493.905 Nonapproved proficiency testing programs.

       Proficiency Testing Programs by Specialty and Subspecialty

493.909 Microbiology.
493.911 Bacteriology.
493.913 Mycobacteriology.
493.915 Mycology.
493.917 Parasitology.
493.919 Virology.
493.921 Diagnostic immunology.
493.923 Syphilis serology.
493.927 General immunology.
493.929 Chemistry.
493.931 Routine chemistry.
493.933 Endocrinology.
493.937 Toxicology.
493.941 Hematology (including routine hematology and coagulation).
493.945 Cytology; gynecologic examinations.
493.959 Immunohematology.

         Subpart J_Facility Administration for Nonwaived Testing

493.1100 Condition: Facility administration.
493.1101 Standard: Facilities.
493.1103 Standard: Requirements for transfusion services.
493.1105 Standard: Retention requirements.

             Subpart K_Quality System for Nonwaived Testing

493.1200 Introduction.
493.1201 Condition: Bacteriology.
493.1202 Condition: Mycobacteriology.
493.1203 Condition: Mycology.
493.1204 Condition: Parasitology.
493.1205 Condition: Virology.
493.1207 Condition: Syphilis serology.
493.1208 Condition: General immunology.
493.1210 Condition: Routine chemistry.
493.1211 Condition: Urinalysis.
493.1212 Condition: Endocrinology.
493.1213 Condition: Toxicology.
493.1215 Condition: Hematology.
493.1217 Condition: Immunohematology.
493.1219 Condition: Histopathology.
493.1220 Condition: Oral pathology.
493.1221 Condition: Cytology.
493.1225 Condition: Clinical cytogenetics.
493.1226 Condition: Radiobioassay.

[[Page 508]]

493.1227 Condition: Histocompatibility.

                       General Laboratory Systems

493.1230 Condition: General laboratory systems.
493.1231 Standard: Confidentiality of patient information.
493.1232 Standard: Specimen identification and integrity.
493.1233 Standard: Complaint investigations.
493.1234 Standard: Communications.
493.1235 Standard: Personnel competency assessment policies.
493.1236 Standard: Evaluation of proficiency testing performance.
493.1239 Standard: General laboratory systems quality assessment.

                           Preanalytic Systems

493.1240 Condition: Preanalytic systems.
493.1241 Standard: Test request.
493.1242 Standard: Specimen submission, handling, and referral.
493.1249 Standard: Preanalytic systems quality assessment.

                            Analytic Systems

493.1250 Condition: Analytic systems.
493.1251 Standard: Procedure manual.
493.1252 Standard: Test systems, equipment, instruments, reagents, 
          materials, and supplies.
493.1253 Standard: Establishment and verification of performance 
          specifications.
493.1254 Standard: Maintenance and function checks.
493.1255 Standard: Calibration and calibration verification procedures.
493.1256 Standard: Control procedures.
493.1261 Standard: Bacteriology.
493.1262 Standard: Mycobacteriology.
493.1263 Standard: Mycology.
493.1264 Standard: Parasitology.
493.1265 Standard: Virology.
493.1267 Standard: Routine chemistry.
493.1269 Standard: Hematology.
493.1271 Standard: Immunohematology.
493.1273 Standard: Histopathology.
493.1274 Standard: Cytology.
493.1276 Standard: Clinical cytogenetics.
493.1278 Standard: Histocompatibility.
493.1281 Standard: Comparison of test results.
493.1282 Standard: Corrective actions.
493.1283 Standard: Test records.
493.1289 Standard: Analytic systems quality assessment.

                          Postanalytic Systems

493.1290 Condition: Postanalytic systems.
493.1291 Standard: Test report.
493.1299 Standard: Postanalytic systems quality assessment.

Subpart L [Reserved]

                Subpart M_Personnel for Nonwaived Testing

493.1351 General.

 Laboratories Performing Provider-Performed Microscopy (PPM) Procedures

493.1353 Scope.
493.1355 Condition: Laboratories performing PPM procedures; laboratory 
          director.
493.1357 Standard; laboratory director qualifications.
493.1359 Standard; PPM laboratory director responsibilities.
493.1361 Condition: Laboratories performing PPM procedures; testing 
          personnel.
493.1363 Standard; PPM testing personnel qualifications.
493.1365 Standard; PPM testing personnel responsibilities.

           Laboratories Performing Moderate Complexity Testing

493.1403 Condition: Laboratories performing moderate complexity testing; 
          laboratory director.
493.1405 Standard; Laboratory director qualifications.
493.1406 Standard; Laboratory director qualifications on or before 
          February 28, 1992.
493.1407 Standard; Laboratory director responsibilities.
493.1409 Condition: Laboratories performing moderate complexity testing; 
          technical consultant.
493.1411 Standard; Technical consultant qualifications.
493.1413 Standard; Technical consultant responsibilities.
493.1415 Condition: Laboratories performing moderate complexity testing; 
          clinical consultant.
493.1417 Standard; Clinical consultant qualifications.
493.1419 Standard; Clinical consultant responsibilities.
493.1421 Condition: Laboratories performing moderate complexity testing; 
          testing personnel.
493.1423 Standard; Testing personnel qualifications.
493.1425 Standard; Testing personnel responsibilities.

             Laboratories Performing High Complexity Testing

493.1441 Condition: Laboratories performing high complexity testing; 
          laboratory director.
493.1443 Standard; Laboratory director qualifications.
493.1445 Standard; Laboratory director responsibilities.

[[Page 509]]

493.1447 Condition: Laboratories performing high complexity testing; 
          technical supervisor.
493.1449 Standard; Technical supervisor qualifications.
493.1451 Standard; Technical supervisor responsibilities.
493.1453 Condition: Laboratories performing high complexity testing; 
          clinical consultant.
493.1455 Standard; Clinical consultant qualifications.
493.1457 Standard; Clinical consultant responsibilities.
493.1459 Condition: Laboratories performing high complexity testing; 
          general supervisor.
493.1461 Standard; General supervisor qualifications.
493.1462 General supervisor qualifications on or before February 28, 
          1992.
493.1463 Standard; General supervisor responsibilities.
493.1467 Condition: Laboratories performing high complexity testing; 
          cytology general supervisor.
493.1469 Standard; Cytology general supervisor qualifications.
493.1471 Standard; Cytology general supervisor responsibilities.
493.1481 Condition: Laboratories performing high complexity testing; 
          cytotechnologist.
493.1483 Standard; Cytotechnologist qualifications.
493.1485 Standard; Cytotechnologist responsibilities.
493.1487 Condition: Laboratories performing high complexity testing; 
          testing personnel.
493.1489 Standard; Testing personnel qualifications.
493.1491 Technologist qualifications on or before February 28, 1992.
493.1495 Standard; Testing personnel responsibilities.

Subparts N-P [Reserved]

                          Subpart Q_Inspection

493.1771 Condition: Inspection requirements applicable to all CLIA-
          certified and CLIA-exempt laboratories.
493.1773 Standard: Basic inspection requirements for all laboratories 
          issued a CLIA certificate and CLIA-exempt laboratories.
493.1775 Standard: Inspection of laboratories issued a certificate of 
          waiver or a certificate for provider-performed microscopy 
          procedures.
493.1777 Standard: Inspection of laboratories that have requested or 
          have been issued a certificate of compliance.
493.1780 Standard: Inspection of CLIA-exempt laboratories or 
          laboratories requesting or issued a certificate of 
          accreditation.

                    Subpart R_Enforcement Procedures

493.1800 Basis and scope.
493.1804 General considerations.
493.1806 Available sanctions: All laboratories.
493.1807 Additional sanctions: Laboratories that participate in 
          Medicare.
493.1808 Adverse action on any type of CLIA certificate: Effect on 
          Medicare approval.
493.1809 Limitation on Medicaid payment.
493.1810 Imposition and lifting of alternative sanctions.
493.1812 Action when deficiencies pose immediate jeopardy.
493.1814 Action when deficiencies are at the condition level but do not 
          pose immediate jeopardy.
493.1816 Action when deficiencies are not at the condition level.
493.1820 Ensuring timely correction of deficiencies.
493.1826 Suspension of part of Medicare payments.
493.1828 Suspension of all Medicare payments.
493.1832 Directed plan of correction and directed portion of a plan of 
          correction.
493.1834 Civil money penalty.
493.1836 State onsite monitoring.
493.1838 Training and technical assistance for unsuccessful 
          participation in proficiency testing.
493.1840 Suspension, limitation, or revocation of any type of CLIA 
          certificate.
493.1842 Cancellation of Medicare approval.
493.1844 Appeals procedures.
493.1846 Civil action.
493.1850 Laboratory registry.

Subpart S [Reserved]

                         Subpart T_Consultations

493.2001 Establishment and function of the Clinical Laboratory 
          Improvement Advisory Committee.

    Authority: Sec. 353 of the Public Health Service Act, secs. 1102, 
1861(e), the sentence following sections 1861(s)(11) through 1861(s)(16) 
of the Social Security Act (42 U.S.C. 263a, 1302, 1395x(e), the sentence 
following 1395x(s)(11) through 1395x(s)(16)).

    Source: 55 FR 9576, Mar. 14, 1990, unless otherwise noted.



                      Subpart A_General Provisions

    Source: 57 FR 7139, Feb. 28, 1992, unless otherwise noted.

[[Page 510]]



Sec.  493.1  Basis and scope.

    This part sets forth the conditions that all laboratories must meet 
to be certified to perform testing on human specimens under the Clinical 
Laboratory Improvement Amendments of 1988 (CLIA). It implements sections 
1861 (e) and (j), the sentence following section 1861(s)(13), and 
1902(a)(9) of the Social Security Act, and section 353 of the Public 
Health Service Act. This part applies to all laboratories as defined 
under ``laboratory'' in Sec.  493.2 of this part. This part also applies 
to laboratories seeking payment under the Medicare and Medicaid 
programs. The requirements are the same for Medicare approval as for 
CLIA certification.



Sec.  493.2  Definitions.

    As used in this part, unless the context indicates otherwise--
    Accredited institution means a school or program which--
    (a) Admits as regular student only persons having a certificate of 
graduation from a school providing secondary education, or the 
recognized equivalent of such certificate;
    (b) Is legally authorized within the State to provide a program of 
education beyond secondary education;
    (c) Provides an educational program for which it awards a bachelor's 
degree or provides not less than a 2-year program which is acceptable 
toward such a degree, or provides an educational program for which it 
awards a master's or doctoral degree;
    (d) Is accredited by a nationally recognized accrediting agency or 
association.
    This definition includes any foreign institution of higher education 
that HHS or its designee determines meets substantially equivalent 
requirements.
    Accredited laboratory means a laboratory that has voluntarily 
applied for and been accredited by a private, nonprofit accreditation 
organization approved by CMS in accordance with this part;
    Adverse action means the imposition of a principal or alternative 
sanction by CMS.
    ALJ stands for Administrative Law Judge.
    Alternative sanctions means sanctions that may be imposed in lieu of 
or in addition to principal sanctions. The term is synonymous with 
``intermediate sanctions'' as used in section 1846 of the Act.
    Analyte means a substance or constituent for which the laboratory 
conducts testing.
    Approved accreditation organization for laboratories means a 
private, nonprofit accreditation organization that has formally applied 
for and received CMS's approval based on the organization's compliance 
with this part.
    Approved State laboratory program means a licensure or other 
regulatory program for laboratories in a State, the requirements of 
which are imposed under State law, and the State laboratory program has 
received CMS approval based on the State's compliance with this part.
    Authorized person means an individual authorized under State law to 
order tests or receive test results, or both.
    Calibration means a process of testing and adjusting an instrument 
or test system to establish a correlation between the measurement 
response and the concentration or amount of the substance that is being 
measured by the test procedure.
    Calibration verification means the assaying of materials of known 
concentration in the same manner as patient samples to substantiate the 
instrument or test system's calibration throughout the reportable range 
for patient test results.
    Challenge means, for quantitative tests, an assessment of the amount 
of substance or analyte present or measured in a sample. For qualitative 
tests, a challenge means the determination of the presence or the 
absence of an analyte, organism, or substance in a sample.
    CLIA means the Clinical Laboratory Improvement Amendments of 1988.
    CLIA certificate means any of the following types of certificates 
issued by CMS or its agent:
    (1) Certificate of compliance means a certificate issued to a 
laboratory after an inspection that finds the laboratory to be in 
compliance with all applicable condition level requirements, or reissued 
before the expiration date, pending an appeal, in accordance with

[[Page 511]]

Sec.  493.49, when an inspection has found the laboratory to be out of 
compliance with one or more condition level requirements.
    (2) Certificate for provider-performed microscopy (PPM) procedures 
means a certificate issued or reissued before the expiration date, 
pending an appeal, in accordance with Sec.  493.47, to a laboratory in 
which a physician, midlevel practitioner or dentist performs no tests 
other than PPM procedures and, if desired, waived tests listed in Sec.  
493.15(c).
    (3) Certificate of accreditation means a certificate issued on the 
basis of the laboratory's accreditation by an accreditation organization 
approved by CMS (indicating that the laboratory is deemed to meet 
applicable CLIA requirements) or reissued before the expiration date, 
pending an appeal, in accordance with Sec.  493.61, when a validation or 
complaint survey has found the laboratory to be noncompliant with one or 
more CLIA conditions.
    (4) Certificate of registration or registration certificate means a 
certificate issued or reissued before the expiration date, pending an 
appeal, in accordance with Sec.  493.45, that enables the entity to 
conduct moderate or high complexity laboratory testing or both until the 
entity is determined to be in compliance through a survey by CMS or its 
agent; or in accordance with Sec.  493.57 to an entity that is 
accredited by an approved accreditation organization.
    (5) Certificate of waiver means a certificate issued or reissued 
before the expiration date, pending an appeal, in accordance with Sec.  
493.37, to a laboratory to perform only the waived tests listed at Sec.  
493.15(c).
    CLIA-exempt laboratory means a laboratory that has been licensed or 
approved by a State where CMS has determined that the State has enacted 
laws relating to laboratory requirements that are equal to or more 
stringent than CLIA requirements and the State licensure program has 
been approved by CMS in accordance with subpart E of this part.
    Condition level deficiency means noncompliance with one or more 
condition level requirements.
    Condition level requirements means any of the requirements 
identified as ``conditions'' in subparts G through Q of this part.
    Credible allegation of compliance means a statement or documentation 
that--
    (1) Is made by a representative of a laboratory that has a history 
of having maintained a commitment to compliance and of taking corrective 
action when required;
    (2) Is realistic in terms of its being possible to accomplish the 
required corrective action between the date of the exit conference and 
the date of the allegation; and
    (3) Indicates that the problem has been resolved.
    Dentist means a doctor of dental medicine or doctor of dental 
surgery licensed by the State to practice dentistry within the State in 
which the laboratory is located.
    Equivalency means that an accreditation organization's or a State 
laboratory program's requirements, taken as a whole, are equal to or 
more stringent than the CLIA requirements established by CMS, taken as 
whole. It is acceptable for an accreditation organization's or State 
laboratory program's requirements to be organized differently or 
otherwise vary from the CLIA requirements, as long as (1) all of the 
requirements taken as a whole would provide at least the same protection 
as the CLIA requirements taken as a whole; and (2) a finding of 
noncompliance with respect to CLIA requirements taken as a whole would 
be matched by a finding of noncompliance with the accreditation or State 
requirements taken as a whole.
    CMS agent means an entity with which CMS arranges to inspect 
laboratories and assess laboratory activities against CLIA requirements 
and may be a State survey agency, a private, nonprofit organization 
other than an approved accreditation organization, a component of HHS, 
or any other governmental component CMS approves for this purpose. In 
those instances where all of the laboratories in a State are exempt from 
CLIA requirements, based on the approval of a State's exemption request, 
the State survey agency is not the CMS agent.

[[Page 512]]

    FDA-cleared or approved test system means a test system cleared or 
approved by the FDA through the premarket notification (510(k)) or 
premarket approval (PMA) process for in-vitro diagnostic use. Unless 
otherwise stated, this includes test systems exempt from FDA premarket 
clearance or approval.
    HHS means the Department of Health and Human Services, or its 
designee.
    Immediate jeopardy means a situation in which immediate corrective 
action is necessary because the laboratory's noncompliance with one or 
more condition level requirements has already caused, is causing, or is 
likely to cause, at any time, serious injury or harm, or death, to 
individuals served by the laboratory or to the health or safety of the 
general public. This term is synonymous with imminent and serious risk 
to human health and significant hazard to the public health.
    Intentional violation means knowing and willful noncompliance with 
any CLIA condition.
    Kit means all components of a test that are packaged together.
    Laboratory means a facility for the biological, microbiological, 
serological, chemical, immunohematological, hematological, biophysical, 
cytological, pathological, or other examination of materials derived 
from the human body for the purpose of providing information for the 
diagnosis, prevention, or treatment of any disease or impairment of, or 
the assessment of the health of, human beings. These examinations also 
include procedures to determine, measure, or otherwise describe the 
presence or absence of various substances or organisms in the body. 
Facilities only collecting or preparing specimens (or both) or only 
serving as a mailing service and not performing testing are not 
considered laboratories.
    Midlevel practitioner means a nurse midwife, nurse practitioner, or 
physician assistant, licensed by the State within which the individual 
practices, if such licensing is required in the State in which the 
laboratory is located.
    Nonwaived test means any test system, assay, or examination that has 
not been found to meet the statutory criteria specified at section 
353(d)(3) of the Public Health Service Act.
    Operator means the individual or group of individuals who oversee 
all facets of the operation of a laboratory and who bear primary 
responsibility for the safety and reliability of the results of all 
specimen testing performed in that laboratory. The term includes--
    (1) A director of the laboratory if he or she meets the stated 
criteria; and
    (2) The members of the board of directors and the officers of a 
laboratory that is a small corporation under subchapter S of the 
Internal Revenue Code.
    Owner means any person who owns any interest in a laboratory except 
for an interest in a laboratory whose stock and/or securities are 
publicly traded. (That is e.g., the purchase of shares of stock or 
securities on the New York Stock Exchange in a corporation owning a 
laboratory would not make a person an owner for the purpose of this 
regulation.)
    Party means a laboratory affected by any of the enforcement 
procedures set forth in this subpart, by CMS or the OIG, as appropriate.
    Performance characteristic means a property of a test that is used 
to describe its quality, e.g., accuracy, precision, analytical 
sensitivity, analytical specificity, reportable range, reference range, 
etc.
    Performance specification means a value or range of values for a 
performance characteristic, established or verified by the laboratory, 
that is used to describe the quality of patient test results.
    Physician means an individual with a doctor of medicine, doctor of 
osteopathy, or doctor of podiatric medicine degree who is licensed by 
the State to practice medicine, osteopathy, or podiatry within the State 
in which the laboratory is located.
    Principal sanction means the suspension, limitation, or revocation 
of any type of CLIA certificate or the cancellation of the laboratory's 
approval to receive Medicare payment for its services.
    Prospective laboratory means a laboratory that is operating under a 
registration certificate or is seeking any of the three other types of 
CLIA certificates.

[[Page 513]]

    Rate of disparity means the percentage of sample validation 
inspections for a specific accreditation organization or State where 
CMS, the State survey agency or other CMS agent finds noncompliance with 
one or more condition level requirements but no comparable deficiencies 
were cited by the accreditation organization or the State, and it is 
reasonable to conclude that the deficiencies were present at the time of 
the most recent accreditation organization or State licensure 
inspection.

    Example: Assume the State survey agency, CMS or other CMS agent 
performs 200 sample validation inspections for laboratories accredited 
by a single accreditation organization or licensed in an exempt State 
during a validation review period and finds that 60 of the 200 
laboratories had one or more condition level requirements out of 
compliance. CMS reviews the validation and accreditation organization's 
or State's inspections of the validated laboratories and determines that 
the State or accreditation organization found comparable deficiencies in 
22 of the 60 laboratories and it is reasonable to conclude that 
deficiencies were present in the remaining 38 laboratories at the time 
of the accreditation organization's or State's inspection. Thirty-eight 
divided by 200 equals a 19 percent rate of disparity.

    Referee laboratory means a laboratory currently in compliance with 
applicable CLIA requirements, that has had a record of satisfactory 
proficiency testing performance for all testing events for at least one 
year for a specific test, analyte, subspecialty, or specialty and has 
been designated by an HHS approved proficiency testing program as a 
referee laboratory for analyzing proficiency testing specimens for the 
purpose of determining the correct response for the specimens in a 
testing event for that specific test, analyte, subspecialty, or 
specialty.
    Reference range means the range of test values expected for a 
designated population of individuals, e.g., 95 percent of individuals 
that are presumed to be healthy (or normal).
    Reportable range means the span of test result values over which the 
laboratory can establish or verify the accuracy of the instrument or 
test system measurement response.
    Sample in proficiency testing means the material contained in a 
vial, on a slide, or other unit that contains material to be tested by 
proficiency testing program participants. When possible, samples are of 
human origin.
    State includes, for purposes of this part, each of the 50 States, 
the District of Columbia, the Commonwealth of Puerto Rico, the Virgin 
Islands and a political subdivision of a State where the State, acting 
pursuant to State law, has expressly delegated powers to the political 
subdivision sufficient to authorize the political subdivision to act for 
the State in enforcing requirements equal to or more stringent than CLIA 
requirements.
    State licensure means the issuance of a license to, or the approval 
of, a laboratory by a State laboratory program as meeting standards for 
licensing or approval established under State law.
    State licensure program means a State laboratory licensure or 
approval program.
    State survey agency means the State health agency or other 
appropriate State or local agency that has an agreement under section 
1864 of the Social Security Act and is used by CMS to perform surveys 
and inspections.
    Substantial allegation of noncompliance means a complaint from any 
of a variety of sources (including complaints submitted in person, by 
telephone, through written correspondence, or in newspaper or magazine 
articles) that, if substantiated, would have an impact on the health and 
safety of the general public or of individuals served by a laboratory 
and raises doubts as to a laboratory's compliance with any condition 
level requirement.
    Target value for quantitative tests means either the mean of all 
participant responses after removal of outliers (those responses greater 
than 3 standard deviations from the original mean) or the mean 
established by definitive or reference methods acceptable for use in the 
National Reference System for the Clinical Laboratory (NRSCL) by the 
National Committee for the Clinical Laboratory Standards (NCCLS). In 
instances where definitive or reference methods are not available or a 
specific method's results demonstrate bias that is not observed with

[[Page 514]]

actual patient specimens, as determined by a defensible scientific 
protocol, a comparative method or a method group (``peer'' group) may be 
used. If the method group is less than 10 participants, ``target value'' 
means the overall mean after outlier removal (as defined above) unless 
acceptable scientific reasons are available to indicate that such an 
evaluation is not appropriate.
    Test system means the instructions and all of the instrumentation, 
equipment, reagents, and supplies needed to perform an assay or 
examination and generate test results.
    Unsatisfactory proficiency testing performance means failure to 
attain the minimum satisfactory score for an analyte, test, 
subspecialty, or specialty for a testing event.
    Unsuccessful participation in proficiency testing means any of the 
following:
    (1) Unsatisfactory performance for the same analyte in two 
consecutive or two out of three testing events.
    (2) Repeated unsatisfactory overall testing event scores for two 
consecutive or two out of three testing events for the same specialty or 
subspecialty.
    (3) An unsatisfactory testing event score for those subspecialties 
not graded by analyte (that is, bacteriology, mycobacteriology, 
virology, parasitology, mycology, blood compatibility, immunohematology, 
or syphilis serology) for the same subspecialty for two consecutive or 
two out of three testing events.
    (4) Failure of a laboratory performing gynecologic cytology to meet 
the standard at Sec.  493.855.
    Unsuccessful proficiency testing performance means a failure to 
attain the minimum satisfactory score for an analyte, test, 
subspecialty, or specialty for two consecutive or two of three 
consecutive testing events.
    Validation review period means the one year time period during which 
CMS conducts validation inspections and evaluates the results of the 
most recent surveys performed by an accreditation organization or State 
laboratory program.
    Waived test means a test system, assay, or examination that HHS has 
determined meets the CLIA statutory criteria as specified for waiver 
under section 353(d)(3) of the Public Health Service Act.

[57 FR 7139, Feb. 28, 1992, as amended at 57 FR 7236, Feb. 28, 1992; 57 
FR 34013, July 31, 1992; 57 FR 35761, Aug. 11, 1992; 58 FR 5220, Jan. 
19, 1993; 58 FR 48323, Sept. 15, 1993; 60 FR 20043, Apr. 24, 1995; 63 FR 
26732, May 14, 1998; 68 FR 3702, Jan. 24, 2003; 68 FR 50723, Aug. 22, 
2003]



Sec.  493.3  Applicability.

    (a) Basic rule. Except as specified in paragraph (b) of this 
section, a laboratory will be cited as out of compliance with section 
353 of the Public Health Service Act unless it--
    (1) Has a current, unrevoked or unsuspended certificate of waiver, 
registration certificate, certificate of compliance, certificate for PPM 
procedures, or certificate of accreditation issued by HHS applicable to 
the category of examinations or procedures performed by the laboratory; 
or
    (2) Is CLIA-exempt.
    (b) Exception. These rules do not apply to components or functions 
of--
    (1) Any facility or component of a facility that only performs 
testing for forensic purposes;
    (2) Research laboratories that test human specimens but do not 
report patient specific results for the diagnosis, prevention or 
treatment of any disease or impairment of, or the assessment of the 
health of individual patients; or
    (3) Laboratories certified by the Substance Abuse and Mental Health 
Services Administration (SAMHSA), in which drug testing is performed 
which meets SAMHSA guidelines and regulations. However, all other 
testing conducted by a SAMHSA-certified laboratory is subject to this 
rule.
    (c) Federal laboratories. Laboratories under the jurisdiction of an 
agency of the Federal Government are subject to the rules of this part, 
except that the Secretary may modify the application of such 
requirements as appropriate.

[57 FR 7139, Feb. 28, 1992, as amended at 58 FR 5221, Jan. 19, 1993; 60 
FR 20043, Apr. 24, 1995; 68 FR 3702, Jan. 24, 2003]



Sec.  493.5  Categories of tests by complexity.

    (a) Laboratory tests are categorized as one of the following:

[[Page 515]]

    (1) Waived tests.
    (2) Tests of moderate complexity, including the subcategory of PPM 
procedures.
    (3) Tests of high complexity.
    (b) A laboratory may perform only waived tests, only tests of 
moderate complexity, only PPM procedures, only tests of high complexity 
or any combination of these tests.
    (c) Each laboratory must be either CLIA-exempt or possess one of the 
following CLIA certificates, as defined in Sec.  493.2:
    (1) Certificate of registration or registration certificate.
    (2) Certificate of waiver.
    (3) Certificate for PPM procedures.
    (4) Certificate of compliance.
    (5) Certificate of accreditation.

[60 FR 20043, Apr. 24, 1995]



Sec.  493.15  Laboratories performing waived tests.

    (a) Requirement. Tests for certificate of waiver must meet the 
descriptive criteria specified in paragraph (b) of this section.
    (b) Criteria. Test systems are simple laboratory examinations and 
procedures which--
    (1) Are cleared by FDA for home use;
    (2) Employ methodologies that are so simple and accurate as to 
render the likelihood of erroneous results negligible; or
    (3) Pose no reasonable risk of harm to the patient if the test is 
performed incorrectly.
    (c) Certificate of waiver tests. A laboratory may qualify for a 
certificate of waiver under section 353 of the PHS Act if it restricts 
the tests that it performs to one or more of the following tests or 
examinations (or additional tests added to this list as provided under 
paragraph (d) of this section) and no others:
    (1) Dipstick or Tablet Reagent Urinalysis (non-automated) for the 
following:
    (i) Bilirubin;
    (ii) Glucose;
    (iii) Hemoglobin;
    (iv) Ketone;
    (v) Leukocytes;
    (vi) Nitrite;
    (vii) pH;
    (viii) Protein;
    (ix) Specific gravity; and
    (x) Urobilinogen.
    (2) Fecal occult blood;
    (3) Ovulation tests--visual color comparison tests for human 
luteinizing hormone;
    (4) Urine pregnancy tests--visual color comparison tests;
    (5) Erythrocyte sedimentation rate--non-automated;
    (6) Hemoglobin--copper sulfate--non-automated;
    (7) Blood glucose by glucose monitoring devices cleared by the FDA 
specifically for home use;
    (8) Spun microhematocrit; and
    (9) Hemoglobin by single analyte instruments with self-contained or 
component features to perform specimen/reagent interaction, providing 
direct measurement and readout.
    (d) Revisions to criteria for test categorization and the list of 
waived tests. HHS will determine whether a laboratory test meets the 
criteria listed under paragraph (b) of this section for a waived test. 
Revisions to the list of waived tests approved by HHS will be published 
in the Federal Register in a notice with opportunity for comment.
    (e) Laboratories eligible for a certificate of waiver must--
    (1) Follow manufacturers' instructions for performing the test; and
    (2) Meet the requirements in subpart B, Certificate of Waiver, of 
this part.

[57 FR 7139, Feb. 28, 1992, as amended at 58 FR 5221, Jan. 19, 1993]



Sec.  493.17  Test categorization.

    (a) Categorization by criteria. Notices will be published in the 
Federal Register which list each specific test system, assay, and 
examination categorized by complexity. Using the seven criteria 
specified in this paragraph for categorizing tests of moderate or high 
complexity, each specific laboratory test system, assay, and examination 
will be graded for level of complexity by assigning scores of 1, 2, or 3 
within each criteria. The score of ``1'' indicates the lowest level of 
complexity, and the score of ``3'' indicates the highest level. These 
scores will be totaled. Test systems, assays or examinations receiving 
scores of 12 or less

[[Page 516]]

will be categorized as moderate complexity, while those receiving scores 
above 12 will be categorized as high complexity.

    Note: A score of ``2'' will be assigned to a criteria heading when 
the characteristics for a particular test are intermediate between the 
descriptions listed for scores of ``1'' and ``3.''

    (1) Knowledge. (i) Score 1. (A) Minimal scientific and technical 
knowledge is required to perform the test; and
    (B) Knowledge required to perform the test may be obtained through 
on-the-job instruction.
    (ii) Score 3. Specialized scientific and technical knowledge is 
essential to perform preanalytic, analytic or postanalytic phases of the 
testing.
    (2) Training and experience. (i) Score 1. (A) Minimal training is 
required for preanalytic, analytic and postanalytic phases of the 
testing process; and
    (B) Limited experience is required to perform the test.
    (ii) Score 3. (A) Specialized training is essential to perform the 
preanalytic, analytic or postanalytic testing process; or
    (B) Substantial experience may be necessary for analytic test 
performance.
    (3) Reagents and materials preparation. (i) Score 1. (A) Reagents 
and materials are generally stable and reliable; and
    (B) Reagents and materials are prepackaged, or premeasured, or 
require no special handling, precautions or storage conditions.
    (ii) Score 3. (A) Reagents and materials may be labile and may 
require special handling to assure reliability; or
    (B) Reagents and materials preparation may include manual steps such 
as gravimetric or volumetric measurements.
    (4) Characteristics of operational steps. (i) Score 1. Operational 
steps are either automatically executed (such as pipetting, temperature 
monitoring, or timing of steps), or are easily controlled.
    (ii) Score 3. Operational steps in the testing process require close 
monitoring or control, and may require special specimen preparation, 
precise temperature control or timing of procedural steps, accurate 
pipetting, or extensive calculations.
    (5) Calibration, quality control, and proficiency testing materials. 
(i) Score 1. (A) Calibration materials are stable and readily available;
    (B) Quality control materials are stable and readily available; and
    (C) External proficiency testing materials, when available, are 
stable.
    (ii) Score 3. (A) Calibration materials, if available, may be 
labile;
    (B) Quality control materials may be labile, or not available; or
    (C) External proficiency testing materials, if available, may be 
labile.
    (6) Test system troubleshooting and equipment maintenance. (i) Score 
1. (A) Test system troubleshooting is automatic or self-correcting, or 
clearly described or requires minimal judgment; and
    (B) Equipment maintenance is provided by the manufacturer, is seldom 
needed, or can easily be performed.
    (ii) Score 3. (A) Troubleshooting is not automatic and requires 
decision-making and direct intervention to resolve most problems; or
    (B) Maintenance requires special knowledge, skills, and abilities.
    (7) Interpretation and judgment. (i) Score 1. (A) Minimal 
interpretation and judgment are required to perform preanalytic, 
analytic and postanalytic processes; and
    (B) Resolution of problems requires limited independent 
interpretation and judgment; and
    (ii) Score 3. (A) Extensive independent interpretation and judgment 
are required to perform the preanalytic, analytic or postanalytic 
processes; and
    (B) Resolution of problems requires extensive interpretation and 
judgment.
    (b) Revisions to the criteria for categorization. The Clinical 
Laboratory Improvement Advisory Committee, as defined in subpart T of 
this part, will conduct reviews upon request of HHS and recommend to HHS 
revisions to the criteria for categorization of tests.
    (c) Process for device/test categorization utilizing the scoring 
system under Sec.  493.17(a). (1)(i) For new commercial test systems, 
assays, or examinations, the manufacturer, as part of its 510(k)

[[Page 517]]

and PMA application to FDA, will submit supporting data for device/test 
categorization. FDA will determine the complexity category, notify the 
manufacturers directly, and will simultaneously inform both CMS and CDC 
of the device/test category. FDA will consult with CDC concerning test 
categorization in the following three situations:
    (A) When categorizing previously uncategorized new technology;
    (B) When FDA determines it to be necessary in cases involving a 
request for a change in categorization; and
    (C) If a manufacturer requests review of a categorization decision 
by FDA in accordance with 21 CFR 10.75.
    (ii) Test categorization will be effective as of the notification to 
the applicant.
    (2) For test systems, assays, or examinations not commercially 
available, a laboratory or professional group may submit a written 
request for categorization to PHS. These requests will be forwarded to 
CDC for evaluation; CDC will determine complexity category and notify 
the applicant, CMS, and FDA of the categorization decision. In the case 
of request for a change of category or for previously uncategorized new 
technology, PHS will receive the request application and forward it to 
CDC for categorization.
    (3) A request for recategorization will be accepted for review if it 
is based on new information not previously submitted in a request for 
categorization or recategorization by the same applicant and will not be 
considered more frequently than once per year.
    (4) If a laboratory test system, assay or examination does not 
appear on the lists of tests in the Federal Register notices, it is 
considered to be a test of high complexity until PHS, upon request, 
reviews the matter and notifies the applicant of its decision. Test 
categorization is effective as of the notification to the applicant.
    (5) PHS will publish revisions periodically to the list of moderate 
and high complexity tests in the Federal Register in a notice with 
opportunity for comment.

[57 FR 7139, Feb. 28, 1992, as amended at 58 FR 5222, Jan. 19, 1993]



Sec.  493.19  Provider-performed microscopy (PPM) procedures.

    (a) Requirement. To be categorized as a PPM procedure, the procedure 
must meet the criteria specified in paragraph (b) of this section.
    (b) Criteria. Procedures must meet the following specifications:
    (1) The examination must be personally performed by one of the 
following practitioners:
    (i) A physician during the patient's visit on a specimen obtained 
from his or her own patient or from a patient of a group medical 
practice of which the physician is a member or an employee.
    (ii) A midlevel practitioner, under the supervision of a physician 
or in independent practice only if authorized by the State, during the 
patient's visit on a specimen obtained from his or her own patient or 
from a patient of a clinic, group medical practice, or other health care 
provider of which the midlevel practitioner is a member or an employee.
    (iii) A dentist during the patient's visit on a specimen obtained 
from his or her own patient or from a patient of a group dental practice 
of which the dentist is a member or an employee.
    (2) The procedure must be categorized as moderately complex.
    (3) The primary instrument for performing the test is the 
microscope, limited to bright-field or phase-contrast microscopy.
    (4) The specimen is labile or delay in performing the test could 
compromise the accuracy of the test result.
    (5) Control materials are not available to monitor the entire 
testing process.
    (6) Limited specimen handling or processing is required.
    (c) Provider-performed microscopy (PPM) examinations. A laboratory 
may qualify to perform tests under this section if it restricts PPM 
examinations to one or more of the following procedures (or additional 
procedures added to this list as provided under paragraph (d) of this 
section), waived tests and no others:
    (1) All direct wet mount preparations for the presence or absence of 
bacteria, fungi, parasites, and human cellular elements.

[[Page 518]]

    (2) All potassium hydroxide (KOH) preparations.
    (3) Pinworm examinations.
    (4) Fern tests.
    (5) Post-coital direct, qualitative examinations of vaginal or 
cervical mucous.
    (6) Urine sediment examinations.
    (7) Nasal smears for granulocytes.
    (8) Fecal leukocyte examinations.
    (9) Qualitative semen analysis (limited to the presence or absence 
of sperm and detection of motility).
    (d) Revisions to criteria and the list of PPM procedures. (1) The 
CLIAC conducts reviews upon HHS' request and recommends to HHS revisions 
to the criteria for categorization of procedures.
    (2) HHS determines whether a laboratory procedure meets the criteria 
listed under paragraph (b) of this section for a PPM procedure. 
Revisions to the list of PPM procedures proposed by HHS are published in 
the Federal Register as a notice with an opportunity for public comment.
    (e) Laboratory requirements. Laboratories eligible to perform PPM 
examinations must--
    (1) Meet the applicable requirements in subpart C or subpart D, and 
subparts F, H, J, K, and M of this part.
    (2) Be subject to inspection as specified under subpart Q of this 
part.

[60 FR 20044, Apr. 24, 1995; 68 FR 50723, Aug. 22, 2003]



Sec.  493.20  Laboratories performing tests of moderate complexity.

    (a) A laboratory may qualify for a certificate to perform tests of 
moderate complexity provided that it restricts its test performance to 
waived tests or examinations and one or more tests or examinations 
meeting criteria for tests of moderate complexity including the 
subcategory of PPM procedures.
    (b) A laboratory that performs tests or examinations of moderate 
complexity must meet the applicable requirements in subpart C or subpart 
D, and subparts F, H, J, K, M, and Q of this part. Under a registration 
certificate or certificate of compliance, laboratories also performing 
PPM procedures must meet the inspection requirements at Sec. Sec.  
493.1773 and 493.1777.
    (c) If the laboratory also performs waived tests, compliance with 
subparts H, J, K, and M of this part is not applicable to the waived 
tests. However, the laboratory must comply with the requirements in 
Sec. Sec.  493.15(e), 493.1773, and 493.1775.

[60 FR 20044, Apr. 24, 1995, as amended at 68 FR 3702, Jan. 24, 2003; 68 
FR 50723, Aug. 22, 2003]



Sec.  493.25  Laboratories performing tests of high complexity.

    (a) A laboratory must obtain a certificate for tests of high 
complexity if it performs one or more tests that meet the criteria for 
tests of high complexity as specified in Sec.  493.17(a).
    (b) A laboratory performing one or more tests of high complexity 
must meet the applicable requirements of subpart C or subpart D, and 
subparts F, H, J, K, M, and Q of this part.
    (c) If the laboratory also performs tests of moderate complexity, 
the applicable requirements of subparts H, J, K, M, and Q of this part 
must be met. Under a registration certificate or certificate of 
compliance, PPM procedures must meet the inspection requirements at 
Sec. Sec.  493.1773 and 493.1777.
    (d) If the laboratory also performs waived tests, the requirements 
of subparts H, J, K, and M are not applicable to the waived tests. 
However, the laboratory must comply with the requirements in Sec. Sec.  
493.15(e), 493.1773, and 493.1775.

[57 FR 7139, Feb. 28, 1992, as amended at 60 FR 20044, Apr. 24, 1995; 68 
FR 3702, Jan. 24, 2003; 68 FR 50723, Aug. 22, 2003]



                     Subpart B_Certificate of Waiver

    Source: 57 FR 7142, Feb. 28, 1992, unless otherwise noted.



Sec.  493.35  Application for a certificate of waiver.

    (a) Filing of application. Except as specified in paragraph (b) of 
this section, a laboratory performing only one or more waived tests 
listed in Sec.  493.15 must file a separate application for each 
laboratory location.
    (b) Exceptions. (1) Laboratories that are not at a fixed location, 
that is, laboratories that move from testing site

[[Page 519]]

to testing site, such as mobile units providing laboratory testing, 
health screening fairs, or other temporary testing locations may be 
covered under the certificate of the designated primary site or home 
base, using its address.
    (2) Not-for-profit or Federal, State, or local government 
laboratories that engage in limited (not more than a combination of 15 
moderately complex or waived tests per certificate) public health 
testing may file a single application.
    (3) Laboratories within a hospital that are located at contiguous 
buildings on the same campus and under common direction may file a 
single application or multiple applications for the laboratory sites 
within the same physical location or street address.
    (c) Application format and contents. The application must--
    (1) Be made to HHS or its designee on a form or forms prescribed by 
HHS;
    (2) Be signed by an owner, or by an authorized representative of the 
laboratory who attests that the laboratory will be operated in 
accordance with requirements established by the Secretary under section 
353 of the PHS Act; and
    (3) Describe the characteristics of the laboratory operation and the 
examinations and other test procedures performed by the laboratory 
including--
    (i) The name and the total number of test procedures and 
examinations performed annually (excluding tests the laboratory may run 
for quality control, quality assurance or proficiency testing purposes;
    (ii) The methodologies for each laboratory test procedure or 
examination performed, or both; and
    (iii) The qualifications (educational background, training, and 
experience) of the personnel directing and supervising the laboratory 
and performing the laboratory examinations and test procedures.
    (d) Access requirements. Laboratories that perform one or more 
waived tests listed in Sec.  493.15(c) and no other tests must meet the 
following conditions:
    (1) Make records available and submit reports to HHS as HHS may 
reasonably require to determine compliance with this section and Sec.  
493.15(e);
    (2) Agree to permit announced and unannounced inspections by HHS in 
accordance with subpart Q of this part under the following 
circumstances:
    (i) When HHS has substantive reason to believe that the laboratory 
is being operated in a manner that constitutes an imminent and serious 
risk to human health.
    (ii) To evaluate complaints from the public.
    (iii) On a random basis to determine whether the laboratory is 
performing tests not listed in Sec.  493.15.
    (iv) To collect information regarding the appropriateness of waiver 
of tests listed in Sec.  493.15.
    (e) Denial of application. If HHS determines that the application 
for a certificate of waiver is to be denied, HHS will--
    (1) Provide the laboratory with a written statement of the grounds 
on which the denial is based and an opportunity for appeal, in 
accordance with the procedures set forth in subpart R of this part;
    (2) Notify a laboratory that has its application for a certificate 
of waiver denied that it cannot operate as a laboratory under the PHS 
Act unless the denial is overturned at the conclusion of the 
administrative appeals process provided by subpart R; and
    (3) Notify the laboratory that it is not eligible for payment under 
the Medicare and Medicaid programs.

[57 FR 7142, Feb. 28, 1992, as amended at 58 FR 5222, Jan. 19, 1993; 60 
FR 20044, Apr. 24, 1995]



Sec.  493.37  Requirements for a certificate of waiver.

    (a) HHS will issue a certificate of waiver to a laboratory only if 
the laboratory meets the requirements of Sec.  493.35.
    (b) Laboratories issued a certificate of waiver--
    (1) Are subject to the requirements of this subpart and Sec.  
493.15(e) of subpart A of this part; and
    (2) Must permit announced or unannounced inspections by HHS in 
accordance with subpart Q of this part.
    (c) Laboratories must remit the certificate of waiver fee specified 
in subpart F of this part.

[[Page 520]]

    (d) In accordance with subpart R of this part, HHS will suspend or 
revoke or limit a laboratory's certificate of waiver for failure to 
comply with the requirements of this subpart. In addition, failure to 
meet the requirements of this subpart will result in suspension or 
denial of payments under Medicare and Medicaid in accordance with 
subpart R of this part.
    (e)(1) A certificate of waiver issued under this subpart is valid 
for no more than 2 years. In the event of a non-compliance determination 
resulting in HHS action to revoke, suspend, or limit the laboratory's 
certificate of waiver, HHS will provide the laboratory with a statement 
of grounds on which the determination of non-compliance is based and 
offer an opportunity for appeal as provided in subpart R of this part.
    (2) If the laboratory requests a hearing within the time specified 
by HHS, it retains its certificate of waiver or reissued certificate of 
waiver until a decision is made by an administrative law judge, as 
specified in subpart R of this part, except when HHS finds that 
conditions at the laboratory pose an imminent and serious risk to human 
health.
    (3) For laboratories receiving payment from the Medicare or Medicaid 
program, such payments will be suspended on the effective date specified 
in the notice to the laboratory of a non-compliance determination even 
if there has been no appeals decision issued.
    (f) A laboratory seeking to renew its certificate of waiver must--
    (1) Complete the renewal application prescribed by HHS and return it 
to HHS not less than 9 months nor more than 1 year before the expiration 
of the certificate; and
    (2) Meet the requirements of Sec. Sec.  493.35 and 493.37.
    (g) A laboratory with a certificate of waiver that wishes to perform 
examinations or tests not listed in the waiver test category must meet 
the requirements set forth in subpart C or subpart D of this part, as 
applicable.

[57 FR 7142, Feb. 28, 1992, as amended at 58 FR 5222, Jan. 19, 1993; 60 
FR 20045, Apr. 24, 1995]



Sec.  493.39  Notification requirements for laboratories issued a certificate of waiver.

    Laboratories performing one or more tests listed in Sec.  493.15 and 
no others must notify HHS or its designee--
    (a) Before performing and reporting results for any test or 
examination that is not specified under Sec.  493.15 for which the 
laboratory does not have the appropriate certificate as required in 
subpart C or subpart D of this part, as applicable; and
    (b) Within 30 days of any change(s) in--
    (1) Ownership;
    (2) Name;
    (3) Location; or
    (4) Director.

[57 FR 7142, Feb. 28, 1992, as amended at 60 FR 20045, Apr. 24, 1995]



 Subpart C_Registration Certificate, Certificate for Provider-performed 
          Microscopy Procedures, and Certificate of Compliance

    Source: 57 FR 7143, Feb. 28, 1992, unless otherwise noted.



Sec.  493.43  Application for registration certificate, certificate for provider-performed microscopy (PPM) procedures, and certificate of compliance.

    (a) Filing of application. Except as specified in paragraph (b) of 
this section, all laboratories performing nonwaived testing must file a 
separate application for each laboratory location.
    (b) Exceptions. (1) Laboratories that are not at a fixed location, 
that is, laboratories that move from testing site to testing site, such 
as mobile units providing laboratory testing, health screening fairs, or 
other temporary testing locations may be covered under the certificate 
of the designated primary site or home base, using its address.
    (2) Not-for-profit or Federal, State, or local government 
laboratories that engage in limited (not more than a combination of 15 
moderately complex or waived tests per certificate) public health 
testing may file a single application.

[[Page 521]]

    (3) Laboratories within a hospital that are located at contiguous 
buildings on the same campus and under common direction may file a 
single application or multiple applications for the laboratory sites 
within the same physical location or street address.
    (c) Application format and contents. The application must--(1) Be 
made to HHS or its designee on a form or forms prescribed by HHS;
    (2) Be signed by an owner, or by an authorized representative of the 
laboratory who attests that the laboratory will be operated in 
accordance with the requirements established by the Secretary under 
section 353 of the Public Health Service Act; and
    (3) Describe the characteristics of the laboratory operation and the 
examinations and other test procedures performed by the laboratory 
including--
    (i) The name and total number of test procedures and examinations 
performed annually (excluding waived tests or tests for quality control, 
quality assurance or proficiency testing purposes);
    (ii) The methodologies for each laboratory test procedure or 
examination performed, or both;
    (iii) The qualifications (educational background, training, and 
experience) of the personnel directing and supervising the laboratory 
and performing the examinations and test procedures.
    (d) Access and reporting requirements. All laboratories must make 
records available and submit reports to HHS as HHS may reasonably 
require to determine compliance with this section.

[57 FR 7143, Feb. 28, 1992, as amended at 58 FR 5222, Jan. 19, 1993; 58 
FR 39155, July 22, 1993; 60 FR 20045, Apr. 24, 1995; 68 FR 3702, Jan. 
24, 2003]



Sec.  493.45  Requirements for a registration certificate.

    Laboratories performing only waived tests, PPM procedures, or any 
combination of these tests, are not required to obtain a registration 
certificate.
    (a) A registration certificate is required--(1) Initially for all 
laboratories performing test procedures of moderate complexity (other 
than the subcategory of PPM procedures) or high complexity, or both; and
    (2) For all laboratories that have been issued a certificate of 
waiver or certificate for PPM procedures that intend to perform tests of 
moderate or high complexity, or both, in addition to those tests listed 
in Sec.  493.15(c) or specified as PPM procedures.
    (b) HHS will issue a registration certificate if the laboratory--
    (1) Complies with the requirements of Sec.  493.43;
    (2) Agrees to notify HHS or its designee within 30 days of any 
changes in ownership, name, location, director or technical supervisor 
(laboratories performing high complexity testing only);
    (3) Agrees to treat proficiency testing samples in the same manner 
as it treats patient specimens; and
    (4) Remits the fee for the registration certificate, as specified in 
subpart F of this part.
    (c) Prior to the expiration of the registration certificate, a 
laboratory must--
    (1) Remit the certificate fee specified in subpart F of this part;
    (2) Be inspected by HHS as specified in subpart Q of this part; and
    (3) Demonstrate compliance with the applicable requirements of this 
subpart and subparts H, J, K, M, and Q of this part.
    (d) In accordance with subpart R of this part, HHS will initiate 
suspension or revocation of a laboratory's registration certificate and 
will deny the laboratory's application for a certificate of compliance 
for failure to comply with the requirements set forth in this subpart. 
HHS may also impose certain alternative sanctions. In addition, failure 
to meet the requirements of this subpart will result in suspension of 
payments under Medicare and Medicaid as specified in subpart R of this 
part.
    (e) A registration certificate is--
    (1) Valid for a period of no more than two years or until such time 
as an inspection to determine program compliance can be conducted, 
whichever is shorter; and
    (2) Not renewable; however, the registration certificate may be 
reissued if compliance has not been determined by HHS prior to the 
expiration date of the registration certificate.

[[Page 522]]

    (f) In the event of a noncompliance determination resulting in an 
HHS denial of a laboratory's certificate of compliance application, HHS 
will provide the laboratory with a statement of grounds on which the 
noncompliance determination is based and offer an opportunity for appeal 
as provided in subpart R.
    (g) If the laboratory requests a hearing within the time specified 
by HHS, it retains its registration certificate or reissued registration 
certificate until a decision is made by an administrative law judge as 
provided in subpart R of this part, except when HHS finds that 
conditions at the laboratory pose an imminent and serious risk to human 
health.
    (h) For laboratories receiving payment from the Medicare or Medicaid 
program, such payments will be suspended on the effective date specified 
in the notice to the laboratory of denial of the certificate application 
even if there has been no appeals decision issued.

[57 FR 7143, Feb. 28, 1992, as amended at 58 FR 5223, Jan. 19, 1993; 60 
FR 20045, Apr. 24, 1995; 68 FR 3702, Jan. 24, 2003]



Sec.  493.47  Requirements for a certificate for provider-performed microscopy (PPM) procedures.

    (a) A certificate for PPM procedures is required--
    (1) Initially for all laboratories performing test procedures 
specified as PPM procedures; and
    (2) For all certificate of waiver laboratories that intend to 
perform only test procedures specified as PPM procedures in addition to 
those tests listed in Sec.  493.15(c).
    (b) HHS will issue a certificate for PPM procedures if the 
laboratory--
    (1) Complies with the requirements of Sec.  493.43; and
    (2) Remits the fee for the certificate, as specified in subpart F of 
this part.
    (c) Laboratories issued a certificate for PPM procedures are subject 
to--
    (1) The notification requirements of Sec.  493.53;
    (2) The applicable requirements of this subpart and subparts H, J, 
K, and M of this part; and
    (3) Inspection only under the circumstances specified under 
Sec. Sec.  493.1773 and 493.1775, but are not routinely inspected to 
determine compliance with the requirements specified in paragraphs (c) 
(1) and (2) of this section.
    (d) In accordance with subpart R of this part, HHS will initiate 
suspension, limitation, or revocation of a laboratory's certificate for 
PPM procedures for failure to comply with the applicable requirements 
set forth in this subpart. HHS may also impose certain alternative 
sanctions. In addition, failure to meet the requirements of this subpart 
may result in suspension of all or part of payments under Medicare and 
Medicaid, as specified in subpart R of this part.
    (e) A certificate for PPM procedures is valid for a period of no 
more than 2 years.

[58 FR 5223, Jan. 19, 1993, as amended at 60 FR 20045, Apr. 24, 1995; 68 
FR 3702, Jan. 24, 2003; 68 FR 50723, Aug. 22, 2003]



Sec.  493.49  Requirements for a certificate of compliance.

    A certificate of compliance may include any combination of tests 
categorized as high complexity or moderate complexity or listed in Sec.  
493.15(c) as waived tests. Moderate complexity tests may include those 
specified as PPM procedures.
    (a) HHS will issue a certificate of compliance to a laboratory only 
if the laboratory--
    (1) Meets the requirements of Sec. Sec.  493.43 and 493.45;
    (2) Remits the certificate fee specified in subpart F of this part; 
and
    (3) Meets the applicable requirements of this subpart and subparts 
H, J, K, M, and Q of this part.
    (b) Laboratories issued a certificate of compliance--
    (1) Are subject to the notification requirements of Sec.  493.51; 
and
    (2) Must permit announced or unannounced inspections by HHS in 
accordance with subpart Q of this part--
    (i) To determine compliance with the applicable requirements of this 
part;
    (ii) To evaluate complaints;
    (iii) When HHS has substantive reason to believe that tests are 
being performed, or the laboratory is being operated in a manner that 
constitutes an imminent and serious risk to human health; and

[[Page 523]]

    (iv) To collect information regarding the appropriateness of tests 
listed in Sec.  493.15 or tests categorized as moderate complexity 
(including the subcategory) or high complexity.
    (c) Failure to comply with the requirements of this subpart will 
result in--
    (1) Suspension, revocation or limitation of a laboratory's 
certificate of compliance in accordance with subpart R of this part; and
    (2) Suspension or denial of payments under Medicare and Medicaid in 
accordance with subpart R of this part.
    (d) A certificate of compliance issued under this subpart is valid 
for no more than 2 years.
    (e) In the event of a noncompliance determination resulting in an 
HHS action to revoke, suspend or limit the laboratory's certificate of 
compliance, HHS will--
    (1) Provide the laboratory with a statement of grounds on which the 
determination of noncompliance is based; and
    (2) Offer an opportunity for appeal as provided in subpart R of this 
part. If the laboratory requests a hearing within 60 days of the notice 
of sanction, it retains its certificate of compliance or reissued 
certificate of compliance until a decision is made by an administrative 
law judge (ALJ) as provided in subpart R of this part, except when HHS 
finds that conditions at the laboratory pose an imminent and serious 
risk to human health or when the criteria at Sec.  493.1840(a) (4) and 
(5) are met.
    (f) For laboratories receiving payment from the Medicare or Medicaid 
program, such payments will be suspended on the effective date specified 
in the notice to the laboratory of a noncompliance determination even if 
there has been no appeals decision issued.
    (g) A laboratory seeking to renew its certificate of compliance 
must--
    (1) Complete and return the renewal application to HHS 9 to 12 
months prior to the expiration of the certificate of compliance; and
    (2) Meet the requirements of Sec.  493.43 and paragraphs (a)(2) and 
(b)(2) of this section.
    (h) If HHS determines that the application for the renewal of a 
certificate of compliance must be denied or limited, HHS will notify the 
laboratory in writing of the--
    (1) Basis for denial of the application; and
    (2) Opportunity for appeal as provided in subpart R of this part.
    (i) If the laboratory requests a hearing within the time period 
specified by HHS, the laboratory retains its certificate of compliance 
or reissued certificate of compliance until a decision is made by an ALJ 
as provided in subpart R, except when HHS finds that conditions at the 
laboratory pose an imminent and serious risk to human health.
    (j) For laboratories receiving payment from the Medicare or Medicaid 
program, such payments will be suspended on the effective date specified 
in the notice to the laboratory of nonrenewal of the certificate of 
compliance even if there has been no appeals decision issued.

[60 FR 20045, Apr. 24, 1995, as amended at 68 FR 3702, Jan. 24, 2003]



Sec.  493.51  Notification requirements for laboratories issued a certificate of compliance.

    Laboratories issued a certificate of compliance must meet the 
following conditions:
    (a) Notify HHS or its designee within 30 days of any change in--
    (1) Ownership;
    (2) Name;
    (3) Location;
    (4) Director; or
    (5) Technical supervisor (laboratories performing high complexity 
only).
    (b) Notify HHS no later than 6 months after performing any test or 
examination within a specialty or subspecialty area that is not included 
on the laboratory's certificate of compliance, so that compliance with 
requirements can be determined.
    (c) Notify HHS no later than 6 months after any deletions or changes 
in test methodologies for any test or examination included in a 
specialty or subspecialty, or both, for which the laboratory has been 
issued a certificate of compliance.

[57 FR 7143, Feb. 28, 1992, as amended at 60 FR 20046, Apr. 24, 1995]

[[Page 524]]



Sec.  493.53  Notification requirements for laboratories issued a certificate for provider-performed microscopy (PPM) procedures.

    Laboratories issued a certificate for PPM procedures must notify HHS 
or its designee--
    (a) Before performing and reporting results for any test of moderate 
or high complexity, or both, in addition to tests specified as PPM 
procedures or any test or examination that is not specified under Sec.  
493.15(c), for which it does not have a registration certificate as 
required in subpart C or subpart D, as applicable, of this part; and
    (b) Within 30 days of any change in--
    (1) Ownership;
    (2) Name;
    (3) Location; or
    (4) Director.

[58 FR 5224, Jan. 19, 1993, as amended at 60 FR 20046, Apr. 24, 1995]



                 Subpart D_Certificate of Accreditation

    Source: 57 FR 7144, Feb. 28, 1992, unless otherwise noted.



Sec.  493.55  Application for registration certificate and certificate of accreditation.

    (a) Filing of application. A laboratory may be issued a certificate 
of accreditation in lieu of the applicable certificate specified in 
subpart B or subpart C of this part provided the laboratory--
    (1) Meets the standards of a private non-profit accreditation 
program approved by HHS in accordance with subpart E; and
    (2) Files a separate application for each location, except as 
specified in paragraph (b) of this section.
    (b) Exceptions. (1) Laboratories that are not at fixed locations, 
that is, laboratories that move from testing site to testing site, such 
as mobile units providing laboratory testing, health screening fairs, or 
other temporary testing locations may be covered under the certificate 
of the designated primary site or home base, using its address.
    (2) Not-for-profit or Federal, State, or local government 
laboratories that engage in limited (not more than a combination of 15 
moderately complex or waived tests per certificate) public health 
testing may file a single application.
    (3) Laboratories within a hospital that are located at contiguous 
buildings on the same campus and under common direction may file a 
single application or multiple applications for the laboratory sites 
within the same physical location or street address.
    (c) Application format and contents. The application must--(1) Be 
made to HHS on a form or forms prescribed by HHS;
    (2) Be signed by an owner or authorized representative of the 
laboratory who attests that the laboratory will be operated in 
accordance with the requirements established by the Secretary under 
section 353 of the Public Health Service Act; and
    (3) Describe the characteristics of the laboratory operation and the 
examinations and other test procedures performed by the laboratory 
including--
    (i) The name and total number of tests and examinations performed 
annually (excluding waived tests and tests for quality control, quality 
assurance or proficiency testing purposes);
    (ii) The methodologies for each laboratory test procedure or 
examination performed, or both; and
    (iii) The qualifications (educational background, training, and 
experience) of the personnel directing and supervising the laboratory 
and performing the laboratory examinations and test procedures.
    (d) Access and reporting requirements. All laboratories must make 
records available and submit reports to HHS as HHS may reasonably 
require to determine compliance with this section.

[57 FR 7144, Feb. 28, 1992, as amended at 58 FR 5224, Jan. 19, 1993; 58 
FR 39155, July 22, 1993; 60 FR 20046, Apr. 24, 1995]



Sec.  493.57  Requirements for a registration certificate.

    A registration certificate is required for all laboratories seeking 
a certificate of accreditation, unless the laboratory holds a valid 
certificate of compliance issued by HHS.
    (a) HHS will issue a registration certificate if the laboratory--
    (1) Complies with the requirements of Sec.  493.55;

[[Page 525]]

    (2) Agrees to notify HHS within 30 days of any changes in ownership, 
name, location, director, or supervisor (laboratories performing high 
complexity testing only);
    (3) Agrees to treat proficiency testing samples in the same manner 
as it treats patient specimens; and
    (4) Remits the fee for the registration certificate specified in 
subpart F of this part.
    (b)(1) The laboratory must provide HHS with proof of accreditation 
by an approved accreditation program--
    (i) Within 11 months of issuance of the registration certificate; or
    (ii) Prior to the expiration of the certificate of compliance.
    (2) If such proof of accreditation is not supplied within this 
timeframe, the laboratory must meet, or continue to meet, the 
requirements of Sec.  493.49.
    (c) In accordance with subpart R of this part, HHS will initiate 
suspension, revocation, or limitation of a laboratory's registration 
certificate and will deny the laboratory's application for a certificate 
of accreditation for failure to comply with the requirements set forth 
in this subpart. In addition, failure to meet the requirements of this 
subpart will result in suspension or denial of payments under Medicare 
and Medicaid as specified in subpart R of this part.
    (d) A registration certificate is valid for a period of no more than 
2 years. However, it may be reissued if the laboratory is subject to 
subpart C of this part, as specified in Sec.  493.57(b)(2) and 
compliance has not been determined by HHS before the expiration date of 
the registration certificate.
    (e) In the event that the laboratory does not meet the requirements 
of this subpart, HHS will--
    (1) Deny a laboratory's request for certificate of accreditation;
    (2) Notify the laboratory if it must meet the requirements for a 
certificate as defined in subpart C of this part;
    (3) Provide the laboratory with a statement of grounds on which the 
application denial is based;
    (4) Offer an opportunity for appeal on the application denial as 
provided in subpart R of this part. If the laboratory requests a hearing 
within the time specified by HHS, the laboratory will retain its 
registration certificate or reissued registration certificate until a 
decision is made by an administrative law judge as provided in subpart 
R, unless HHS finds that conditions at the laboratory pose an imminent 
and serious risk to human health; and
    (5) For those laboratories receiving payment from the Medicare or 
Medicaid program, such payments will be suspended on the effective date 
specified in the notice to the laboratory of denial of the request even 
if there has been no appeals decision issued.

[57 FR 7144, Feb. 28, 1992, as amended at 60 FR 20046, Apr. 24, 1995]



Sec.  493.61  Requirements for a certificate of accreditation.

    (a) HHS will issue a certificate of accreditation to a laboratory if 
the laboratory--
    (1) Meets the requirements of Sec.  493.57 or, if applicable, Sec.  
493.49 of subpart C of this part; and
    (2) Remits the certificate of accreditation fee specified in subpart 
F of this part.
    (b) Laboratories issued a certificate of accreditation must--
    (1) Treat proficiency testing samples in the same manner as patient 
samples;
    (2) Meet the requirements of Sec.  493.63;
    (3) Comply with the requirements of the approved accreditation 
program;
    (4) Permit random sample validation and complaint inspections as 
required in subpart Q of this part;
    (5) Permit HHS to monitor the correction of any deficiencies found 
through the inspections specified in paragraph (b)(4) of this section;
    (6) Authorize the accreditation program to release to HHS the 
laboratory's inspection findings whenever HHS conducts random sample or 
complaint inspections; and
    (7) Authorize its accreditation program to submit to HHS the results 
of the laboratory's proficiency testing.
    (c) A laboratory failing to meet the requirements of this section--
    (1) Will no longer meet the requirements of this part by virtue of 
its accreditation in an approved accreditation program;
    (2) Will be subject to full determination of compliance by HHS;

[[Page 526]]

    (3) May be subject to suspension, revocation or limitation of the 
laboratory's certificate of accreditation or certain alternative 
sanctions; and
    (4) May be subject to suspension of payments under Medicare and 
Medicaid as specified in subpart R.
    (d) A certificate of accreditation issued under this subpart is 
valid for no more than 2 years. In the event of a non-compliance 
determination as a result of a random sample validation or complaint 
inspection, a laboratory will be subject to a full review by HHS in 
accordance with Sec.  488.11 of this chapter.
    (e) Failure to meet the applicable requirements of part 493, will 
result in an action by HHS to suspend, revoke or limit the certificate 
of accreditation. HHS will--
    (1) Provide the laboratory with a statement of grounds on which the 
determination of noncompliance is based;
    (2) Notify the laboratory if it is eligible to apply for a 
certificate as defined in subpart C of this part; and
    (3) Offer an opportunity for appeal as provided in subpart R of this 
part.
    (f) If the laboratory requests a hearing within the time frame 
specified by HHS--
    (1) It retains its certificate of accreditation or reissued 
certificate of accreditation until a decision is made by an 
administrative law judge as provided in subpart R of this part, unless 
HHS finds that conditions at the laboratory pose an imminent and serious 
risk to human health; and
    (2) For those laboratories receiving payments from the Medicare or 
Medicaid program, such payments will be suspended on the effective date 
specified in the notice to the laboratory even if there has been no 
appeals decision issued.
    (g) In the event the accreditation organization's approval is 
removed by HHS, the laboratory will be subject to the applicable 
requirements of subpart C of this part or Sec.  493.57.
    (h) A laboratory seeking to renew its certificate of accreditation 
must--
    (1) Complete and return the renewal application to HHS 9 to 12 
months prior to the expiration of the certificate of accreditation;
    (2) Meet the requirements of this subpart; and
    (3) Submit the certificate of accreditation fee specified in subpart 
F of this part.
    (i) If HHS determines that the renewal application for a certificate 
of accreditation is to be denied or limited, HHS will notify the 
laboratory in writing of--
    (1) The basis for denial of the application;
    (2) Whether the laboratory is eligible for a certificate as defined 
in subpart C of this part;
    (3) The opportunity for appeal on HHS's action to deny the renewal 
application for certificate of accreditation as provided in subpart R of 
this part. If the laboratory requests a hearing within the time frame 
specified by HHS, it retains its certificate of accreditation or 
reissued certificate of accreditation until a decision is made by an 
administrative law judge as provided in subpart R of this part, unless 
HHS finds that conditions at the laboratory pose an imminent and serious 
risk to human health; and
    (4) Suspension of payments under Medicare or Medicaid for those 
laboratories receiving payments under the Medicare or Medicaid programs.

[57 FR 7144, Feb. 28, 1992, as amended at 58 FR 5224, Jan. 19, 1993]



Sec.  493.63  Notification requirements for laboratories issued a certificate of accreditation.

    Laboratories issued a certificate of accreditation must:
    (a) Notify HHS and the approved accreditation program within 30 days 
of any changes in--
    (1) Ownership;
    (2) Name;
    (3) Location; or
    (4) Director.
    (b) Notify the approved accreditation program no later than 6 months 
after performing any test or examination within a specialty or 
subspecialty area that is not included in the laboratory's 
accreditation, so that the accreditation organization can determine 
compliance and a new certificate of accreditation can be issued.

[[Page 527]]

    (c) Notify the accreditation program no later than 6 months after of 
any deletions or changes in test methodologies for any test or 
examination included in a specialty or subspecialty, or both, for which 
the laboratory has been issued a certificate of accreditation.



     Subpart E_Accreditation by a Private, Nonprofit Accreditation 
  Organization or Exemption Under an Approved State Laboratory Program

    Source: 63 FR 26732, May 14, 1998, unless otherwise noted.



Sec.  493.551  General requirements for laboratories.

    (a) Applicability. CMS may deem a laboratory to meet all applicable 
CLIA program requirements through accreditation by a private nonprofit 
accreditation program (that is, grant deemed status), or may exempt from 
CLIA program requirements all State licensed or approved laboratories in 
a State that has a State licensure program established by law, if the 
following conditions are met:
    (1) The requirements of the accreditation organization or State 
licensure program are equal to, or more stringent than, the CLIA 
condition-level requirements specified in this part, and the laboratory 
would meet the condition-level requirements if it were inspected against 
these requirements.
    (2) The accreditation program or the State licensure program meets 
the requirements of this subpart and is approved by CMS.
    (3) The laboratory authorizes the approved accreditation 
organization or State licensure program to release to CMS all records 
and information required and permits inspections as outlined in this 
part.
    (b) Meeting CLIA requirements by accreditation. A laboratory seeking 
to meet CLIA requirements through accreditation by an approved 
accreditation organization must do the following:
    (1) Obtain a certificate of accreditation as required in subpart D 
of this part.
    (2) Pay the applicable fees as required in subpart F of this part.
    (3) Meet the proficiency testing (PT) requirements in subpart H of 
this part.
    (4) Authorize its PT organization to furnish to its accreditation 
organization the results of the laboratory's participation in an 
approved PT program for the purpose of monitoring the laboratory's PT 
and for making the annual PT results, along with explanatory information 
required to interpret the PT results, available on a reasonable basis, 
upon request of any person. A laboratory that refuses to authorize 
release of its PT results is no longer deemed to meet the condition-
level requirements and is subject to a full review by CMS, in accordance 
with subpart Q of this part, and may be subject to the suspension or 
revocation of its certificate of accreditation under Sec.  493.1840.
    (5) Authorize its accreditation organization to release to CMS or a 
CMS agent the laboratory's PT results that constitute unsuccessful 
participation in an approved PT program, in accordance with the 
definition of ``unsuccessful participation in an approved PT program,'' 
as specified in Sec.  493.2 of this part, when the laboratory has failed 
to achieve successful participation in an approved PT program.
    (6) Authorize its accreditation organization to release to CMS a 
notification of the actions taken by the organization as a result of the 
unsuccessful participation in a PT program within 30 days of the 
initiation of the action. Based on this notification, CMS may take an 
adverse action against a laboratory that fails to participate 
successfully in an approved PT program.
    (c) Withdrawal of laboratory accreditation. After an accreditation 
organization has withdrawn or revoked its accreditation of a laboratory, 
the laboratory retains its certificate of accreditation for 45 days 
after the laboratory receives notice of the withdrawal or revocation of 
the accreditation, or the effective date of any action taken by CMS, 
whichever is earlier.

[[Page 528]]



Sec.  493.553  Approval process (application and reapplication) for accreditation organizations and State licensure programs.

    (a) Information required. An accreditation organization that applies 
or reapplies to CMS for deeming authority, or a State licensure program 
that applies or reapplies to CMS for exemption from CLIA program 
requirements of licensed or approved laboratories within the State, must 
provide the following information:
    (1) A detailed comparison of the individual accreditation, or 
licensure or approval requirements with the comparable condition-level 
requirements; that is, a crosswalk.
    (2) A detailed description of the inspection process, including the 
following:
    (i) Frequency of inspections.
    (ii) Copies of inspection forms.
    (iii) Instructions and guidelines.
    (iv) A description of the review and decision-making process of 
inspections.
    (v) A statement concerning whether inspections are announced or 
unannounced.
    (vi) A description of the steps taken to monitor the correction of 
deficiencies.
    (3) A description of the process for monitoring PT performance, 
including action to be taken in response to unsuccessful participation 
in a CMS-approved PT program.
    (4) Procedures for responding to and for the investigation of 
complaints against its laboratories.
    (5) A list of all its current laboratories and the expiration date 
of their accreditation or licensure, as applicable.
    (6) Procedures for making PT information available (under State 
confidentiality and disclosure requirements, if applicable) including 
explanatory information required to interpret PT results, on a 
reasonable basis, upon request of any person.
    (b) CMS action on an application or reapplication. If CMS receives 
an application or reapplication from an accreditation organization, or 
State licensure program, CMS takes the following actions:
    (1) CMS determines if additional information is necessary to make a 
determination for approval or denial of the application and notifies the 
accreditation organization or State to afford it an opportunity to 
provide the additional information.
    (2) CMS may visit the accreditation organization or State licensure 
program offices to review and verify the policies and procedures 
represented in its application and other information, including, but not 
limited to, review and examination of documents and interviews with 
staff.
    (3) CMS notifies the accreditation organization or State licensure 
program indicating whether CMS approves or denies the request for 
deeming authority or exemption, respectively, and the rationale for any 
denial.
    (c) Duration of approval. CMS approval may not exceed 6 years.
    (d) Withdrawal of application. The accreditation organization or 
State licensure program may withdraw its application at any time before 
official notification, specified at Sec.  493.553(b)(3).



Sec.  493.555  Federal review of laboratory requirements.

    CMS's review of an accreditation organization or State licensure 
program includes, but is not limited to, an evaluation of the following:
    (a) Whether the organization's or State's requirements for 
laboratories are equal to, or more stringent than, the condition-level 
requirements for laboratories.
    (b) The organization's or State's inspection process to determine 
the comparability of the full inspection and complaint inspection 
procedures and requirements to those of CMS, including, but not limited 
to, inspection frequency and the ability to investigate and respond to 
complaints against its laboratories.
    (c) The organization's or State's agreement with CMS that requires 
it to do the following:
    (1) Notify CMS within 30 days of the action taken, of any laboratory 
that has--
    (i) Had its accreditation or licensure suspended, withdrawn, 
revoked, or limited;
    (ii) In any way been sanctioned; or
    (iii) Had any adverse action taken against it.

[[Page 529]]

    (2) Notify CMS within 10 days of any deficiency identified in an 
accredited or CLIA-exempt laboratory if the deficiency poses an 
immediate jeopardy to the laboratory's patients or a hazard to the 
general public.
    (3) Notify CMS, within 30 days, of all newly--
    (i) Accredited laboratories (or laboratories whose areas of 
specialty/subspecialty testing have changed); or
    (ii) Licensed laboratories, including the specialty/subspecialty 
areas of testing.
    (4) Notify each accredited or licensed laboratory within 10 days of 
CMS's withdrawal of the organization's deeming authority or State's 
exemption.
    (5) Provide CMS with inspection schedules, as requested, for 
validation purposes.



Sec.  493.557  Additional submission requirements.

    (a) Specific requirements for accreditation organizations. In 
addition to the information specified in Sec. Sec.  493.553 and 493.555, 
as part of the approval and review process, an accreditation 
organization applying or reapplying for deeming authority must also 
provide the following:
    (1) The specialty or subspecialty areas for which the organization 
is requesting deeming authority and its mechanism for monitoring 
compliance with all requirements equivalent to condition-level 
requirements within the scope of the specialty or subspecialty areas.
    (2) A description of the organization's data management and analysis 
system with respect to its inspection and accreditation decisions, 
including the kinds of routine reports and tables generated by the 
systems.
    (3) Detailed information concerning the inspection process, 
including, but not limited to the following:
    (i) The size and composition of individual accreditation inspection 
teams.
    (ii) Qualifications, education, and experience requirements that 
inspectors must meet.
    (iii) The content and frequency of training provided to inspection 
personnel, including the ability of the organization to provide 
continuing education and training to inspectors.
    (4) Procedures for removal or withdrawal of accreditation status for 
laboratories that fail to meet the organization's standards.
    (5) A proposed agreement between CMS and the accreditation 
organization with respect to the notification requirements specified in 
Sec.  493.555(c).
    (6) Procedures for monitoring laboratories found to be out of 
compliance with its requirements. (These monitoring procedures must be 
used only when the accreditation organization identifies noncompliance. 
If noncompliance is identified through validation inspections, CMS or a 
CMS agent monitors corrections, as authorized at Sec.  493.565(d)).
    (7) A demonstration of its ability to provide CMS with electronic 
data and reports in compatible code, including the crosswalk specified 
in Sec.  493.553(a)(1), that are necessary for effective validation and 
assessment of the organization's inspection process.
    (8) A demonstration of its ability to provide CMS with electronic 
data, in compatible code, related to the adverse actions resulting from 
PT results constituting unsuccessful participation in PT programs as 
well as data related to the PT failures, within 30 days of the 
initiation of adverse action.
    (9) A demonstration of its ability to provide CMS with electronic 
data, in compatible code, for all accredited laboratories, including the 
area of specialty or subspecialty.
    (10) Information defining the adequacy of numbers of staff and other 
resources.
    (11) Information defining the organization's ability to provide 
adequate funding for performing required inspections.
    (12) Any facility-specific data, upon request by CMS, which 
includes, but is not limited to, the following:
    (i) PT results that constitute unsuccessful participation in a CMS-
approved PT program.
    (ii) Notification of the adverse actions or corrective actions 
imposed by the accreditation organization as a result of unsuccessful PT 
participation.
    (13) An agreement to provide written notification to CMS at least 30 
days in advance of the effective date of any proposed change in its 
requirements.

[[Page 530]]

    (14) An agreement to disclose any laboratory's PT results upon 
reasonable request by any person.
    (b) Specific requirements for a State licensure program. In addition 
to requirements in Sec. Sec.  493.553 and 493.555, as part of the 
approval and review process, when a State licensure program applies or 
reapplies for exemption from the CLIA program, the State must do the 
following:
    (1) Demonstrate to CMS that it has enforcement authority and 
administrative structures and resources adequate to enforce its 
laboratory requirements.
    (2) Permit CMS or a CMS agent to inspect laboratories in the State.
    (3) Require laboratories in the State to submit to inspections by 
CMS or a CMS agent as a condition of licensure or approval.
    (4) Agree to pay the cost of the validation program administered in 
that State as specified in Sec. Sec.  493.645(a) and 493.646(b).
    (5) Take appropriate enforcement action against laboratories found 
by CMS not to be in compliance with requirements equivalent to CLIA 
requirements.
    (6) Submit for Medicare and Medicaid payment purposes, a list of the 
specialties and subspecialties of tests performed by each laboratory.
    (7) Submit a written presentation that demonstrates the agency's 
ability to furnish CMS with electronic data in compatible code, 
including the crosswalk specified in Sec.  493.553(a)(1).
    (8) Submit a statement acknowledging that the State will notify CMS 
through electronic transmission of the following:
    (i) Any laboratory that has had its licensure or approval revoked or 
withdrawn or has been in any way sanctioned by the State within 30 days 
of taking the action.
    (ii) Changes in licensure or inspection requirements.
    (iii) Changes in specialties or subspecialties under which any 
licensed laboratory in the State performs testing.
    (9) Provide information for the review of the State's enforcement 
procedures for laboratories found to be out of compliance with the 
State's requirements.
    (10) Submit information that demonstrates the ability of the State 
to provide CMS with the following:
    (i) Electronic data and reports in compatible code with the adverse 
or corrective actions resulting from PT results that constitute 
unsuccessful participation in PT programs.
    (ii) Other data that CMS determines are necessary for validation and 
assessment of the State's inspection process requirements.
    (11) Agree to provide CMS with written notification of any changes 
in its licensure/approval and inspection requirements.
    (12) Agree to disclose any laboratory's PT results in accordance 
with a State's confidentiality requirements.
    (13) Agree to take the appropriate enforcement action against 
laboratories found by CMS not to be in compliance with requirements 
comparable to condition-level requirements and report these enforcement 
actions to CMS.
    (14) If approved, reapply to CMS every 2 years to renew its exempt 
status and to renew its agreement to pay the cost of the CMS-
administered validation program in that State.



Sec.  493.559  Publication of approval of deeming authority or CLIA exemption.

    (a) Notice of deeming authority or exemption. CMS publishes a notice 
in the Federal Register when it grants deeming authority to an 
accreditation organization or exemption to a State licensure program.
    (b) Contents of notice. The notice includes the following:
    (1) The name of the accreditation organization or State licensure 
program.
    (2) For an accreditation organization:
    (i) The specific specialty or subspecialty areas for which it is 
granted deeming authority.
    (ii) A description of how the accreditation organization provides 
reasonable assurance to CMS that a laboratory accredited by the 
organization meets CLIA requirements equivalent to those in this part 
and would meet CLIA requirements if the laboratory had not been granted 
deemed status, but had been inspected against condition-level 
requirements.

[[Page 531]]

    (3) For a State licensure program, a description of how the 
laboratory requirements of the State are equal to, or more stringent 
than, those specified in this part.
    (4) The basis for granting deeming authority or exemption.
    (5) The term of approval, not to exceed 6 years.



Sec.  493.561  Denial of application or reapplication.

    (a) Reconsideration of denial. (1) If CMS denies a request for 
approval, an accreditation organization or State licensure program may 
request, within 60 days of the notification of denial, that CMS 
reconsider its original application or application for renewal, in 
accordance with part 488, subpart D.
    (2) If the accreditation organization or State licensure program 
requests a reconsideration of CMS's determination to deny its request 
for approval or reapproval, it may not submit a new application until 
CMS issues a final reconsideration determination.
    (b) Resubmittal of a request for approval--accreditation 
organization. An accreditation organization may resubmit a request for 
approval if a final reconsideration determination is not pending and the 
accreditation program meets the following conditions:
    (1) It has revised its accreditation program to address the 
rationale for denial of its previous request.
    (2) It demonstrates that it can provide reasonable assurance that 
its accredited facilities meet condition-level requirements.
    (3) It resubmits the application in its entirety.
    (c) Resubmittal of request for approval--State licensure program. 
The State licensure program may resubmit a request for approval if a 
final reconsideration determination is not pending and it has taken the 
necessary action to address the rationale for any previous denial.



Sec.  493.563  Validation inspections--Basis and focus.

    (a) Basis for validation inspection--(1) Laboratory with a 
certificate of accreditation. (i) CMS or a CMS agent may conduct an 
inspection of an accredited laboratory that has been issued a 
certificate of accreditation on a representative sample basis or in 
response to a substantial allegation of noncompliance.
    (ii) CMS uses the results of these inspections to validate the 
accreditation organization's accreditation process.
    (2) Laboratory in a State with an approved State licensure program. 
(i) CMS or a CMS agent may conduct an inspection of any laboratory in a 
State with an approved State licensure program on a representative 
sample basis or in response to a substantial allegation of 
noncompliance.
    (ii) The results of these inspections are used to validate the 
appropriateness of the exemption of that State's licensed or approved 
laboratories from CLIA program requirements.
    (b) Validation inspection conducted on a representative sample 
basis. (1) If CMS or a CMS agent conducts a validation inspection on a 
representative sample basis, the inspection is comprehensive, addressing 
all condition-level requirements, or it may be focused on a specific 
condition-level requirement.
    (2) The number of laboratories sampled is sufficient to allow a 
reasonable estimate of the performance of the accreditation organization 
or State.
    (c) Validation inspection conducted in response to a substantial 
allegation of noncompliance. (1) If CMS or a CMS agent conducts a 
validation inspection in response to a substantial allegation of 
noncompliance, the inspection focuses on any condition-level requirement 
that CMS determines to be related to the allegation.
    (2) If CMS or a CMS agent substantiates a deficiency and determines 
that the laboratory is out of compliance with any condition-level 
requirement, CMS or a CMS agent conducts a full CLIA inspection.
    (d) Inspection of operations and offices. As part of the validation 
review process, CMS may conduct an onsite inspection of the operations 
and offices to verify the following:
    (1) The accreditation organization's representations and to assess 
the accreditation organization's compliance with its own policies and 
procedures.
    (2) The State's representations and to assess the State's compliance 
with its own policies and procedures, including

[[Page 532]]

verification of State enforcement actions taken on the basis of 
validation inspections performed by CMS or a CMS agent.
    (e) Onsite inspection of an accreditation organization. An onsite 
inspection of an accreditation organization may include, but is not 
limited to, the following:
    (1) A review of documents.
    (2) An audit of meetings concerning the accreditation process.
    (3) Evaluation of accreditation inspection results and the 
accreditation decision-making process.
    (4) Interviews with the accreditation organization's staff.
    (f) Onsite inspection of a State licensure program. An onsite 
inspection of a State licensure program office may include, but is not 
limited to, the following:
    (1) A review of documents.
    (2) An audit of meetings concerning the licensure or approval 
process.
    (3) Evaluation of State inspection results and the licensure or 
approval decision-making process.
    (4) Interviews with State employees.



Sec.  493.565  Selection for validation inspection--laboratory responsibilities.

    A laboratory selected for a validation inspection must do the 
following:
    (a) Authorize its accreditation organization or State licensure 
program, as applicable, to release to CMS or a CMS agent, on a 
confidential basis, a copy of the laboratory's most recent full, and any 
subsequent partial inspection.
    (b) Authorize CMS or a CMS agent to conduct a validation inspection.
    (c) Provide CMS or a CMS agent with access to all facilities, 
equipment, materials, records, and information that CMS or a CMS agent 
determines have a bearing on whether the laboratory is being operated in 
accordance with the requirements of this part, and permit CMS or a CMS 
agent to copy material or require the laboratory to submit material.
    (d) If the laboratory possesses a valid certificate of 
accreditation, authorize CMS or a CMS agent to monitor the correction of 
any deficiencies found through the validation inspection.



Sec.  493.567  Refusal to cooperate with validation inspection.

    (a) Laboratory with a certificate of accreditation. (1) A laboratory 
with a certificate of accreditation that refuses to cooperate with a 
validation inspection by failing to comply with the requirements in 
Sec.  493.565--
    (i) Is subject to full review by CMS or a CMS agent, in accordance 
with this part; and
    (ii) May be subject to suspension, revocation, or limitation of its 
certificate of accreditation under this part.
    (2) A laboratory with a certificate of accreditation is again deemed 
to meet the condition-level requirements by virtue of its accreditation 
when the following conditions exist:
    (i) The laboratory withdraws any prior refusal to authorize its 
accreditation organization to release a copy of the laboratory's current 
accreditation inspection, PT results, or notification of any adverse 
actions resulting from PT failure.
    (ii) The laboratory withdraws any prior refusal to allow a 
validation inspection.
    (iii) CMS finds that the laboratory meets all the condition-level 
requirements.
    (b) CLIA-exempt laboratory. If a CLIA-exempt laboratory fails to 
comply with the requirements specified in Sec.  493.565, CMS notifies 
the State of the laboratory's failure to meet the requirements.



Sec.  493.569  Consequences of a finding of noncompliance as a result of a validation inspection.

    (a) Laboratory with a certificate of accreditation. If a validation 
inspection results in a finding that the accredited laboratory is out of 
compliance with one or more condition-level requirements, the laboratory 
is subject to--
    (1) The same requirements and survey and enforcement processes 
applied to laboratories that are not accredited and that are found out 
of compliance following an inspection under this part; and
    (2) Full review by CMS, in accordance with this part; that is, the 
laboratory is subject to the principal and alternative sanctions in 
Sec.  493.1806.

[[Page 533]]

    (b) CLIA-exempt laboratory. If a validation inspection results in a 
finding that a CLIA-exempt laboratory is out of compliance with one or 
more condition-level requirements, CMS directs the State to take 
appropriate enforcement action.



Sec.  493.571  Disclosure of accreditation, State and CMS validation inspection results.

    (a) Accreditation organization inspection results. CMS may disclose 
accreditation organization inspection results to the public only if the 
results are related to an enforcement action taken by the Secretary.
    (b) State inspection results. Disclosure of State inspection results 
is the responsibility of the approved State licensure program, in 
accordance with State law.
    (c) CMS validation inspection results. CMS may disclose the results 
of all validation inspections conducted by CMS or its agent.



Sec.  493.573  Continuing Federal oversight of private nonprofit accreditation organizations and approved State licensure programs.

    (a) Comparability review. In addition to the initial review for 
determining equivalency of specified organization or State requirements 
to the comparable condition-level requirements, CMS reviews the 
equivalency of requirements in the following cases:
    (1) When CMS promulgates new condition-level requirements.
    (2) When CMS identifies an accreditation organization or a State 
licensure program whose requirements are no longer equal to, or more 
stringent than, condition-level requirements.
    (3) When an accreditation organization or State licensure program 
adopts new requirements.
    (4) When an accreditation organization or State licensure program 
adopts changes to its inspection process, as required by Sec.  
493.575(b)(1), as applicable.
    (5) Every 6 years, or sooner if CMS determines an earlier review is 
required.
    (b) Validation review. Following the end of a validation review 
period, CMS evaluates the validation inspection results for each 
approved accreditation organization and State licensure program.
    (c) Reapplication procedures. (1) Every 6 years, or sooner, as 
determined by CMS, an approved accreditation organization must reapply 
for continued approval of deeming authority and a State licensure 
program must reapply for continued approval of a CLIA exemption. CMS 
provides notice of the materials that must be submitted as part of the 
reapplication procedure.
    (2) An accreditation organization or State licensure program that 
does not meet the requirements of this subpart, as determined through a 
comparability or validation review, must furnish CMS, upon request, with 
the reapplication materials CMS requests. CMS establishes a deadline by 
which the materials must be submitted.
    (d) Notice. (1) CMS provides written notice, as appropriate, to the 
following:
    (i) An accreditation organization indicating that its approval may 
be in jeopardy if a comparability or validation review reveals that it 
is not meeting the requirements of this subpart and CMS is initiating a 
review of the accreditation organization's deeming authority.
    (ii) A State licensure program indicating that its CLIA exemption 
may be in jeopardy if a comparability or validation review reveals that 
it is not meeting the requirements of this subpart and that a review is 
being initiated of the CLIA exemption of the State's laboratories.
    (2) The notice contains the following information:
    (i) A statement of the discrepancies that were found as well as 
other related documentation.
    (ii) An explanation of CMS's review process on which the final 
determination is based and a description of the possible actions, as 
specified in Sec.  493.575, that CMS may impose based on the findings 
from the comparability or validation review.
    (iii) A description of the procedures available if the accreditation 
organization or State licensure program, as applicable, desires an 
opportunity to explain or justify the findings made during the 
comparability or validation review.

[[Page 534]]

    (iv) The reapplication materials that the accreditation organization 
or State licensure program must submit and the deadline for that 
submission.



Sec.  493.575  Removal of deeming authority or CLIA exemption and final determination review.

    (a) CMS review. CMS conducts a review of the following:
    (1) A deeming authority review of an accreditation organization's 
program if the comparability or validation review produces findings, as 
described at Sec.  493.573. CMS reviews, as appropriate, the criteria 
described in Sec. Sec.  493.555 and 493.557(a) to reevaluate whether the 
accreditation organization continues to meet all these criteria.
    (2) An exemption review of a State's licensure program if the 
comparability or validation review produces findings, as described at 
Sec.  493.573. CMS reviews, as appropriate, the criteria described in 
Sec. Sec.  493.555 and 493.557(b) to reevaluate whether the licensure 
program continues to meet all these criteria.
    (3) A review of an accreditation organization or State licensure 
program, at CMS's discretion, if validation review findings, 
irrespective of the rate of disparity, indicate widespread or systematic 
problems in the organization's accreditation or State's licensure 
process that provide evidence that the requirements, taken as a whole, 
are no longer equivalent to CLIA requirements, taken as a whole.
    (4) A review of the accreditation organization or State licensure 
program whenever validation inspection results indicate a rate of 
disparity of 20 percent or more between the findings of the organization 
or State and those of CMS or a CMS agent for the following periods:
    (i) One year for accreditation organizations.
    (ii) Two years for State licensure programs.
    (b) CMS action after review. Following the review, CMS may take the 
following action:
    (1) If CMS determines that the accreditation organization or State 
has failed to adopt requirements equal to, or more stringent than, CLIA 
requirements, CMS may give a conditional approval for a probationary 
period of its deeming authority to an organization 30 days following the 
date of CMS's determination, or exempt status to a State within 30 days 
of CMS's determination, both not to exceed 1 year, to afford the 
organization or State an opportunity to adopt equal or more stringent 
requirements.
    (2) If CMS determines that there are widespread or systematic 
problems in the organization's or State's inspection process, CMS may 
give conditional approval during a probationary period, not to exceed 1 
year, effective 30 days following the date of the determination.
    (c) Final determination. CMS makes a final determination as to 
whether the organization or State continues to meet the criteria 
described in this subpart and issues a notice that includes the reasons 
for the determination to the organization or State within 60 days after 
the end of any probationary period. This determination is based on an 
evaluation of any of the following:
    (1) The most recent validation inspection and review findings. To 
continue to be approved, the organization or State must meet the 
criteria of this subpart.
    (2) Facility-specific data, as well as other related information.
    (3) The organization's or State's inspection procedures, surveyors' 
qualifications, ongoing education, training, and composition of 
inspection teams.
    (4) The organization's accreditation requirements, or the State's 
licensure or approval requirements.
    (d) Date of withdrawal of approval. CMS may withdraw its approval of 
the accreditation organization or State licensure program, effective 30 
days from the date of written notice to the organization or State of 
this proposed action, if improvements acceptable to CMS have not been 
made during the probationary period.
    (e) Continuation of validation inspections. The existence of any 
validation review, probationary status, or any other action, such as a 
deeming authority review, by CMS does not affect or limit the conduct of 
any validation inspection.

[[Page 535]]

    (f) Federal Register notice. CMS publishes a notice in the Federal 
Register containing a justification for removing the deeming authority 
from an accreditation organization, or the CLIA-exempt status of a State 
licensure program.
    (g) Withdrawal of approval-effect on laboratory status--(1) 
Accredited laboratory. After CMS withdraws approval of an accreditation 
organization's deeming authority, the certificate of accreditation of 
each affected laboratory continues in effect for 60 days after it 
receives notification of the withdrawal of approval.
    (2) CLIA-exempt laboratory. After CMS withdraws approval of a State 
licensure program, the exempt status of each licensed or approved 
laboratory in the State continues in effect for 60 days after a 
laboratory receives notification from the State of the withdrawal of 
CMS's approval of the program.
    (3) Extension. After CMS withdraws approval of an accreditation 
organization or State licensure program, CMS may extend the period for 
an additional 60 days for a laboratory if it determines that the 
laboratory submitted an application for accreditation to an approved 
accreditation organization or an application for the appropriate 
certificate to CMS or a CMS agent before the initial 60-day period ends.
    (h) Immediate jeopardy to patients. (1) If at any time CMS 
determines that the continued approval of deeming authority of any 
accreditation organization poses immediate jeopardy to the patients of 
the laboratories accredited by the organization, or continued approval 
otherwise constitutes a significant hazard to the public health, CMS may 
immediately withdraw the approval of deeming authority for that 
accreditation organization.
    (2) If at any time CMS determines that the continued approval of a 
State licensure program poses immediate jeopardy to the patients of the 
laboratories in that State, or continued approval otherwise constitutes 
a significant hazard to the public health, CMS may immediately withdraw 
the approval of that State licensure program.
    (i) Failure to pay fees. CMS withdraws the approval of a State 
licensure program if the State fails to pay the applicable fees, as 
specified in Sec. Sec.  493.645(a) and 493.646(b).
    (j) State refusal to take enforcement action. (1) CMS may withdraw 
approval of a State licensure program if the State refuses to take 
enforcement action against a laboratory in that State when CMS 
determines it to be necessary.
    (2) A laboratory that is in a State in which CMS has withdrawn 
program approval is subject to the same requirements and survey and 
enforcement processes that are applied to a laboratory that is not 
exempt from CLIA requirements.
    (k) Request for reconsideration. Any accreditation organization or 
State that is dissatisfied with a determination to withdraw approval of 
its deeming authority or remove approval of its State licensure program, 
as applicable, may request that CMS reconsider the determination, in 
accordance with subpart D of part 488.



                    Subpart F_General Administration

    Source: 57 FR 7138, 7213, Feb. 28, 1992, unless otherwise noted.



Sec.  493.602  Scope of subpart.

    This subpart sets forth the methodology for determining the amount 
of the fees for issuing the appropriate certificate, and for determining 
compliance with the applicable standards of the Public Health Service 
Act (the PHS Act) and the Federal validation of accredited laboratories 
and of CLIA-exempt laboratories.

[60 FR 20047, Apr. 24, 1995]



Sec.  493.606  Applicability of subpart.

    The rules of this subpart are applicable to those laboratories 
specified in Sec.  493.3.

[58 FR 5212, Jan. 19, 1993]



Sec.  493.638  Certificate fees.

    (a) Basic rule. Laboratories must pay a fee for the issuance of a 
registration certificate, certificate for PPM procedures, certificate of 
waiver, certificate of accreditation, or a certificate of

[[Page 536]]

compliance, as applicable. Laboratories must also pay a fee to reapply 
for a certificate for PPM procedures, certificate of waiver, certificate 
of accreditation, or a certificate of compliance. The total of fees 
collected by HHS under the laboratory program must be sufficient to 
cover the general costs of administering the laboratory certification 
program under section 353 of the PHS Act.
    (1) For registration certificates and certificates of compliance, 
the costs include issuing the certificates, collecting the fees, 
evaluating and monitoring proficiency testing programs, evaluating which 
procedures, tests or examinations meet the criteria for inclusion in the 
appropriate complexity category, and implementing section 353 of the PHS 
Act.
    (2) For a certificate of waiver, the costs include issuing the 
certificate, collecting the fees, determining if a certificate of waiver 
should be issued, evaluating which tests qualify for inclusion in the 
waived category, and other direct administrative costs.
    (3) For a certificate for PPM procedures, the costs include issuing 
the certificate, collecting the fees, determining if a certificate for 
PPM procedures should be issued, evaluating which procedures meet the 
criteria for inclusion in the subcategory of PPM procedures, and other 
direct administrative costs.
    (4) For a certificate of accreditation, the costs include issuing 
the certificate, collecting the fees, evaluating the programs of 
accrediting bodies, and other direct administrative costs.
    (b) Fee amount. The fee amount is set annually by HHS on a calendar 
year basis and is based on the category of test complexity, or on the 
category of test complexity and schedules or ranges of annual laboratory 
test volume (excluding waived tests and tests performed for quality 
control, quality assurance, and proficiency testing purposes) and 
specialties tested, with the amounts of the fees in each schedule being 
a function of the costs for all aspects of general administration of 
CLIA as set forth in Sec.  493.649 (b) and (c). This fee is assessed and 
payable at least biennially. The methodology used to determine the 
amount of the fee is found in Sec.  493.649. The amount of the fee 
applicable to the issuance of the registration certificate or the 
issuance or renewal of the certificate for PPM procedures, certificate 
of waiver, certificate of accreditation, or certificate of compliance is 
the amount in effect at the time the application is received. Upon 
receipt of an application for a certificate, HHS or its designee 
notifies the laboratory of the amount of the required fee for the 
requested certificate.

[60 FR 20047, Apr. 24, 1995]



Sec.  493.639  Fee for revised certificate.

    (a) If, after a laboratory is issued a registration certificate, it 
changes its name or location, the laboratory must pay a fee to cover the 
cost of issuing a revised registration certificate. The fee for the 
revised registration certificate is based on the cost to issue the 
revised certificate to the laboratory.
    (b) A laboratory must pay a fee to cover the cost of issuing a 
revised certificate in any of the following circumstances:
    (1) The fee for issuing an appropriate revised certificate is based 
on the cost to issue the revised certificate to the laboratory as 
follows:
    (i) If a laboratory with a certificate of waiver wishes to perform 
tests in addition to those listed in Sec.  493.15(c) as waived tests, it 
must, as set forth in Sec.  493.638, pay an additional fee for the 
appropriate certificate to cover the additional testing.
    (ii) If a laboratory with a certificate for PPM procedures wishes to 
perform tests in addition to those specified as PPM procedures or listed 
in Sec.  493.15(c) as waived tests, it must, as set forth in Sec.  
493.638, pay an additional fee for the appropriate certificate to cover 
the additional testing.
    (2) A laboratory must pay a fee to cover the cost of issuing a 
revised certificate when--
    (i) A laboratory changes its name, location, or its director; or
    (ii) A laboratory deletes services or wishes to add services and 
requests that its certificate be changed. (An additional fee is also 
required under

[[Page 537]]

Sec.  493.643(d) if it is necessary to determine compliance with 
additional requirements.)

[57 FR 7213, Feb. 28, 1992, as amended at 60 FR 20047, Apr, 24, 1995]



Sec.  493.643  Fee for determination of program compliance.

    (a) Fee requirement. In addition to the fee required under Sec.  
493.638, a laboratory subject to routine inspections must pay a fee to 
cover the cost of determining program compliance. Laboratories issued a 
certificate for PPM procedures, certificate of waiver, or a certificate 
of accreditation are not subject to this fee for routine inspections.
    (b) Costs included in the fee. Included in the fee for determining 
program compliance is the cost of evaluating qualifications of 
personnel; monitoring proficiency testing; conducting onsite 
inspections; documenting deficiencies; evaluating laboratories' plans to 
correct deficiencies; and necessary administrative costs. HHS sets the 
fee amounts annually on a calendar year basis. Laboratories are 
inspected biennially; therefore, fees are assessed and payable 
biennially. If additional expenses are incurred to conduct follow up 
visits to verify correction of deficiencies, to impose sanctions, and/or 
for surveyor preparation for and attendance at ALJ hearings, HHS 
assesses an additional fee to include these costs. The additional fee is 
based on the actual resources and time necessary to perform the 
activities.
    (c) Classification of laboratories that require inspection for 
purpose of determining amount of fee. (1) There are ten classifications 
(schedules) of laboratories for the purpose of determining the fee 
amount a laboratory is assessed. Each laboratory is placed into one of 
the ten following schedules based on the laboratory's scope and volume 
of testing (excluding tests performed for quality control, quality 
assurance, and proficiency testing purposes).
    (i) (A) Schedule A Low Volume. The laboratory performs not more than 
2,000 laboratory tests annually.
    (B) Schedule A. The laboratory performs tests in no more than 3 
specialties of service with a total annual volume of more than 2,000 but 
not more than 10,000 laboratory tests.
    (ii) Schedule B. The laboratory performs tests in at least 4 
specialties of service with a total annual volume of not more than 
10,000 laboratory tests.
    (iii) Schedule C. The laboratory performs tests in no more 3 
specialties of service with a total annual volume of more than 10,000 
but not more than 25,000 laboratory tests.
    (iv) Schedule D. The laboratory performs tests in at least 4 
specialties with a total annual volume of more than 10,000 but not more 
than 25,000 laboratory tests.
    (v) Schedule E. The laboratory performs more than 25,000 but not 
more than 50,000 laboratory tests annually.
    (vi) Schedule F. The laboratory performs more than 50,000 but not 
more than 75,000 laboratory tests annually.
    (vii) Schedule G. The laboratory performs more than 75,000 but not 
more than 100,000 laboratory tests annually.
    (viii) Schedule H. The laboratory performs more than 100,000 but not 
more than 500,000 laboratory tests annually.
    (ix) Schedule I. The laboratory performs more than 500,000 but not 
more than 1,000,000 laboratory tests annually.
    (x) Schedule J. The laboratory performs more than 1,000,000 
laboratory tests annually.
    (2) For purposes of determining a laboratory's classification under 
this section, a test is a procedure or examination for a single analyte. 
(Tests performed for quality control, quality assurance, and proficiency 
testing are excluded from the laboratory's total annual volume). Each 
profile (that is, group of tests) is counted as the number of separate 
procedures or examinations; for example, a chemistry profile consisting 
of 18 tests is counted as 18 separate procedures or tests.
    (3) For purposes of determining a laboratory's classification under 
this section, the specialties and subspecialties of service for 
inclusion are:
    (i) The specialty of Microbiology, which includes one or more of the 
following subspecialties:
    (A) Bacteriology.
    (B) Mycobacteriology.
    (C) Mycology.
    (D) Parasitology.

[[Page 538]]

    (E) Virology.
    (ii) The specialty of Serology, which includes one or more of the 
following subspecialties:
    (A) Syphilis Serology.
    (B) General immunology
    (iii) The specialty of Chemistry, which includes one or more of the 
following subspecialties:
    (A) Routine chemistry.
    (B) Endocrinology.
    (C) Toxicology.
    (D) Urinalysis.
    (iv) The specialty of Hematology.
    (v) The specialty of Immunohematology, which includes one or more of 
the following subspecialties:
    (A) ABO grouping and Rh typing.
    (B) Unexpected antibody detection.
    (C) Compatibility testing.
    (D) Unexpected antibody identification.
    (vi) The specialty of Pathology, which includes the following 
subspecialties:
    (A) Cytology.
    (B) Histopathology.
    (C) Oral pathology.
    (vii) The specialty of Radiobioassay.
    (viii) The specialty of Histocompatibility.
    (ix) The specialty of Clinical Cytogenetics.
    (d) Additional fees. (1) If after a certificate of compliance is 
issued, a laboratory adds services and requests that its certificate be 
upgraded, the laboratory must pay an additional fee if, in order to 
determine compliance with additional requirements, it is necessary to 
conduct an inspection, evaluate personnel, or monitor proficiency 
testing performance. The additional fee is based on the actual resources 
and time necessary to perform the activities. HHS revokes the 
laboratory's certificate for failure to pay the compliance determination 
fee.
    (2) If it is necessary to conduct a complaint investigation, impose 
sanctions, or conduct a hearing, HHS assesses the laboratory holding a 
certificate of compliance a fee to cover the cost of these activities. 
If a complaint investigation results in a complaint being 
unsubstantiated, or if an HHS adverse action is overturned at the 
conclusion of the administrative appeals process, the government's costs 
of these activities are not imposed upon the laboratory. Costs for these 
activities are based on the actual resources and time necessary to 
perform the activities and are not assessed until after the laboratory 
concedes the existence of deficiencies or an ALJ rules in favor of HHS. 
HHS revokes the laboratory's certificate of compliance for failure to 
pay the assessed costs.

[57 FR 7138 and 7213, Feb. 28, 1992, as amended at 60 FR 20047, Apr. 24, 
1995; 68 FR 3702, Jan. 24, 2003]



Sec.  493.645  Additional fee(s) applicable to approved State laboratory programs and laboratories issued a certificate of accreditation, certificate of waiver, 
          or certificate for PPM procedures.

    (a) Approved State laboratory programs. State laboratory programs 
approved by HHS are assessed a fee for the following:
    (1) Costs of Federal inspections of laboratories in that State (that 
is, CLIA-exempt laboratories) to verify that standards are being 
enforced in an appropriate manner.
    (2) Costs incurred for investigations of complaints against the 
State's CLIA-exempt laboratories if the complaint is substantiated.
    (3) Costs of the State's prorata share of general overhead to 
develop and implement CLIA.
    (b) Accredited laboratories. (1) In addition to the certificate fee, 
a laboratory that is issued a certificate of accreditation is also 
assessed a fee to cover the cost of evaluating individual laboratories 
to determine overall whether an accreditation organization's standards 
and inspection policies are equivalent to the Federal program. All 
accredited laboratories share in the cost of these inspections. These 
costs are the same as those that are incurred when inspecting 
nonaccredited laboratories.
    (2) If a laboratory issued a certificate of accreditation has been 
inspected and followup visits are necessary because of identified 
deficiencies, HHS assesses the laboratory a fee to cover the cost of 
these visits. The fee is based on the actual resources and time 
necessary to perform the followup visits. HHS revokes the laboratory's 
certificate of

[[Page 539]]

accreditation for failure to pay the assessed fee.
    (c) If, in the case of a laboratory that has been issued a 
certificate of accreditation, certificate of waiver, or certificate for 
PPM procedures, it is necessary to conduct a complaint investigation, 
impose sanctions, or conduct a hearing, HHS assesses that laboratory a 
fee to cover the cost of these activities. Costs are based on the actual 
resources and time necessary to perform the activities and are not 
assessed until after the laboratory concedes the existence of 
deficiencies or an ALJ rules in favor of HHS. HHS revokes the 
laboratory's certificate for failure to pay the assessed costs. If a 
complaint investigation results in a complaint being unsubstantiated, or 
if an HHS adverse action is overturned at the conclusion of the 
administrative appeals process, the costs of these activities are not 
imposed upon the laboratory.

[60 FR 20047, Apr. 24, 1995]



Sec.  493.646  Payment of fees.

    (a) Except for CLIA-exempt laboratories, all laboratories are 
notified in writing by HHS or its designee of the appropriate fee(s) and 
instructions for submitting the fee(s), including the due date for 
payment and where to make payment. The appropriate certificate is not 
issued until the applicable fees have been paid.
    (b) For State-exempt laboratories, HHS estimates the cost of 
conducting validation surveys within the State for a 2-year period. HHS 
or its designee notifies the State by mail of the appropriate fees, 
including the due date for payment and the address of the United States 
Department of Treasury designated commercial bank to which payment must 
be made. In addition, if complaint investigations are conducted in 
laboratories within these States and are substantiated, HHS bills the 
State(s) the costs of the complaint investigations.

[57 FR 7138 and 7213, Feb. 28, 1992, as amended at 60 FR 20048, Apr. 24, 
1995]



Sec.  493.649  Methodology for determining fee amount.

    (a) General rule. The amount of the fee in each schedule for 
compliance determination inspections is based on the average hourly rate 
(which includes the costs to perform the required activities and 
necessary administration costs) multiplied by the average number of 
hours required or, if activities are performed by more than one of the 
entities listed in paragraph (b) of this section, the sum of the 
products of the applicable hourly rates multiplied by the average number 
of hours required by the entity to perform the activity. The fee for 
issuance of the registration certificate or certificate of compliance is 
based on the laboratory's scope and volume of testing.
    (b) Determining average hourly rates used in fee schedules. Three 
different entities perform activities related to the issuance or 
reissuance of any certificate. HHS determines the average hourly rates 
for the activities of each of these entities.
    (1) State survey agencies. The following costs are included in 
determining an average hourly rate for the activities performed by State 
survey agencies:
    (i) The costs incurred by the State survey agencies in evaluating 
personnel qualifications and monitoring each laboratory's participation 
in an approved proficiency testing program. The cost of onsite 
inspections and monitoring activities is the hourly rate derived as a 
result of an annual budget negotiation process with each State. The 
hourly rate encompasses salary costs (as determined by each State's 
civil service pay scale) and fringe benefit costs to support the 
required number of State inspectors, management and direct support 
staff.
    (ii) Travel costs necessary to comply with each State's 
administrative requirements and other direct costs such as equipment, 
printing, and supplies. These costs are established based on historical 
State requirements.
    (iii) Indirect costs as negotiated by HHS.
    (2) Federal agencies. The hourly rate for activities performed by 
Federal agencies is the most recent average hourly cost to HHS to staff 
and support a full time equivalent employee. Included in this cost are 
salary and

[[Page 540]]

fringe benefit costs, necessary administrative costs, such as printing, 
training, postage, express mail, supplies, equipment, computer system 
and building service charges associated with support services provided 
by organizational components such as a computer center, and any other 
oversight activities necessary to support the program.
    (3) HHS contractors. The hourly rate for activities performed by HHS 
contractors is the average hourly rate established for contractor 
assistance based on an independent government cost estimate for the 
required workload. This rate includes the cost of contractor support to 
provide proficiency testing programs to laboratories that do not 
participate in an approved proficiency testing program, provide 
specialized assistance in the evaluation of laboratory performance in an 
approved proficiency testing program, perform assessments of cytology 
testing laboratories, conduct special studies, bill and collect fees, 
issue certificates, establish accounting, monitoring and reporting 
systems, and assist with necessary surveyor training.
    (c) Determining number of hours. The average number of hours used to 
determine the overall fee in each schedule is HHS's estimate, based on 
historical experience, of the average time needed by each entity to 
perform the activities for which it is responsible.

[57 FR 7138 and 7213, Feb. 28, 1992, as amended at 60 FR 20048, Apr. 24, 
1995]

Subpart G [Reserved]



    Subpart H_Participation in Proficiency Testing for Laboratories 
                      Performing Nonwaived Testing

    Source: 57 FR 7146, Feb. 28, 1992, unless otherwise noted.



Sec.  493.801  Condition: Enrollment and testing of samples.

    Each laboratory must enroll in a proficiency testing (PT) program 
that meets the criteria in subpart I of this part and is approved by 
HHS. The laboratory must enroll in an approved program or programs for 
each of the specialties and subspecialties for which it seeks 
certification. The laboratory must test the samples in the same manner 
as patients' specimens. For laboratories subject to 42 CFR part 493 
published on March 14, 1990 (55 FR 9538) prior to September 1, 1992, the 
rules of this subpart are effective on September 1, 1992. For all other 
laboratories, the rules of this subpart are effective January 1, 1994.
    (a) Standard; Enrollment. The laboratory must--
    (1) Notify HHS of the approved program or programs in which it 
chooses to participate to meet proficiency testing requirements of this 
subpart.
    (2)(i) Designate the program(s) to be used for each specialty, 
subspecialty, and analyte or test to determine compliance with this 
subpart if the laboratory participates in more than one proficiency 
testing program approved by CMS; and
    (ii) For those tests performed by the laboratory that are not 
included in subpart I of this part, a laboratory must establish and 
maintain the accuracy of its testing procedures, in accordance with 
Sec.  493.1236(c)(1).
    (3) For each specialty, subspecialty and analyte or test, 
participate in one approved proficiency testing program or programs, for 
one year before designating a different program and must notify CMS 
before any change in designation; and
    (4) Authorize the proficiency testing program to release to HHS all 
data required to--
    (i) Determine the laboratory's compliance with this subpart; and
    (ii) Make PT results available to the public as required in section 
353(f)(3)(F) of the Public Health Service Act.
    (b) Standard; Testing of proficiency testing samples. The laboratory 
must examine or test, as applicable, the proficiency testing samples it 
receives from the proficiency testing program in the same manner as it 
tests patient specimens.
    (1) The samples must be examined or tested with the laboratory's 
regular patient workload by personnel who routinely perform the testing 
in the laboratory, using the laboratory's routine

[[Page 541]]

methods. The individual testing or examining the samples and the 
laboratory director must attest to the routine integration of the 
samples into the patient workload using the laboratory's routine 
methods.
    (2) The laboratory must test samples the same number of times that 
it routinely tests patient samples.
    (3) Laboratories that perform tests on proficiency testing samples 
must not engage in any inter-laboratory communications pertaining to the 
results of proficiency testing sample(s) until after the date by which 
the laboratory must report proficiency testing results to the program 
for the testing event in which the samples were sent. Laboratories with 
multiple testing sites or separate locations must not participate in any 
communications or discussions across sites/locations concerning 
proficiency testing sample results until after the date by which the 
laboratory must report proficiency testing results to the program.
    (4) The laboratory must not send PT samples or portions of samples 
to another laboratory for any analysis which it is certified to perform 
in its own laboratory. Any laboratory that CMS determines intentionally 
referred its proficiency testing samples to another laboratory for 
analysis will have its certification revoked for at least one year. Any 
laboratory that receives proficiency testing samples from another 
laboratory for testing must notify CMS of the receipt of those samples.
    (5) The laboratory must document the handling, preparation, 
processing, examination, and each step in the testing and reporting of 
results for all proficiency testing samples. The laboratory must 
maintain a copy of all records, including a copy of the proficiency 
testing program report forms used by the laboratory to record 
proficiency testing results including the attestation statement provided 
by the PT program, signed by the analyst and the laboratory director, 
documenting that proficiency testing samples were tested in the same 
manner as patient specimens, for a minimum of two years from the date of 
the proficiency testing event.
    (6) PT is required for only the test system, assay, or examination 
used as the primary method for patient testing during the PT event.

[57 FR 7146, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.803  Condition: Successful participation.

    (a) Each laboratory performing nonwaived testing must successfully 
participate in a proficiency testing program approved by CMS, if 
applicable, as described in subpart I of this part for each specialty, 
subspecialty, and analyte or test in which the laboratory is certified 
under CLIA.
    (b) Except as specified in paragraph (c) of this section, if a 
laboratory fails to participate successfully in proficiency testing for 
a given specialty, subspecialty, analyte or test, as defined in this 
section, or fails to take remedial action when an individual fails 
gynecologic cytology, CMS imposes sanctions, as specified in subpart R 
of this part.
    (c) If a laboratory fails to perform successfully in a CMS-approved 
proficiency testing program, for the initial unsuccessful performance, 
CMS may direct the laboratory to undertake training of its personnel or 
to obtain technical assistance, or both, rather than imposing 
alternative or principle sanctions except when one or more of the 
following conditions exists:
    (1) There is immediate jeopardy to patient health and safety.
    (2) The laboratory fails to provide CMS or a CMS agent with 
satisfactory evidence that it has taken steps to correct the problem 
identified by the unsuccessful proficiency testing performance.
    (3) The laboratory has a poor compliance history.

[57 FR 7146, Feb. 28, 1992, as amended at 60 FR 20048, Apr. 24, 1995; 63 
FR 26737, May 14, 1998; 68 FR 3702, Jan. 24, 2003]



Sec.  493.807  Condition: Reinstatement of laboratories performing nonwaived testing.

    (a) If a laboratory's certificate is suspended or limited or its 
Medicare or Medicaid approval is cancelled or its Medicare or Medicaid 
payments are

[[Page 542]]

suspended because it fails to participate successfully in proficiency 
testing for one or more specialties, subspecialties, analyte or test, or 
voluntarily withdraws its certification under CLIA for the failed 
specialty, subspecialty, or analyte, the laboratory must then 
demonstrate sustained satisfactory performance on two consecutive 
proficiency testing events, one of which may be on site, before CMS will 
consider it for reinstatement for certification and Medicare or Medicaid 
approval in that specialty, subspecialty, analyte or test.
    (b) The cancellation period for Medicare and Medicaid approval or 
period for suspension of Medicare or Medicaid payments or suspension or 
limitation of certification under CLIA for the failed specialty, 
subspecialty, or analyte or test is for a period of not less than six 
months from the date of cancellation, limitation or suspension of the 
CLIA certificate.

[58 FR 5228, Jan. 19, 1993, as amended at 60 FR 20048, Apr. 24, 1995]

   Proficiency Testing by Specialty and Subspecialty for Laboratories 
  Performing Tests of Moderate Complexity (Including the Subcategory), 
           High Complexity, or Any Combination of These Tests



Sec.  493.821  Condition: Microbiology.

    The specialty of microbiology includes, for purposes of proficiency 
testing, the subspecialties of bacteriology, mycobacteriology, mycology, 
parasitology and virology.



Sec.  493.823  Standard; Bacteriology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) Remedial action must be taken and documented, and the 
documentation must be maintained by the laboratory for two years from 
the date of participation in the proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.825  Standard; Mycobacteriology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.

[[Page 543]]

    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) Remedial action must be taken and documented, and the 
documentation must be maintained by the laboratory for two years from 
the date of participation in the proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.827  Standard; Mycology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) Remedial action must be taken and documented, and the 
documentation must be maintained by the laboratory for two years from 
the date of participation in the proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.829  Standard; Parasitology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.

[[Page 544]]

    (2) Remedial action must be taken and documented, and the 
documentation must be maintained by the laboratory for two years from 
the date of participation in the proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.831  Standard; Virology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unsatisfactory testing events, remedial action must be 
taken and documented, and the documentation must be maintained by the 
laboratory for two years from the date of participation in the 
proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.833  Condition: Diagnostic immunology.

    The specialty of diagnostic immunology includes for purposes of 
proficiency testing the subspecialties of syphilis serology and general 
immunology.



Sec.  493.835  Standard; Syphilis serology.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unacceptable testing event score, remedial action must 
be taken and documented, and the documentation must be maintained by the 
laboratory for two years from the date of participation in the 
proficiency testing event.

[[Page 545]]

    (e) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.837  Standard; General immunology.

    (a) Failure to attain a score of at least 80 percent of acceptable 
responses for each analyte in each testing event is unsatisfactory 
analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (e)(1) For any unsatisfactory analyte or test performance or testing 
event for reasons other than a failure to participate, the laboratory 
must undertake appropriate training and employ the technical assistance 
necessary to correct problems associated with a proficiency testing 
failure.
    (2) For any unacceptable analyte or testing event score, remedial 
action must be taken and documented, and the documentation must be 
maintained by the laboratory for two years from the date of 
participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
or test in two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.839  Condition: Chemistry.

    The specialty of chemistry includes for the purposes of proficiency 
testing the subspecialties of routine chemistry, endocrinology, and 
toxicology.



Sec.  493.841  Standard; Routine chemistry.

    (a) Failure to attain a score of at least 80 percent of acceptable 
responses for each analyte in each testing event is unsatisfactory 
analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (e)(1) For any unsatisfactory analyte or test performance or testing 
event for reasons other than a failure to participate, the laboratory 
must undertake appropriate training and employ the technical assistance 
necessary to

[[Page 546]]

correct problems associated with a proficiency testing failure.
    (2) For any unacceptable analyte or testing event score, remedial 
action must be taken and documented, and the documentation must be 
maintained by the laboratory for two years from the date of 
participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
or test in two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.843  Standard; Endocrinology.

    (a) Failure to attain a score of at least 80 percent of acceptable 
responses for each analyte in each testing event is unsatisfactory 
analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (e)(1) For any unsatisfactory analyte or test performance or testing 
event for reasons other than a failure to participate, the laboratory 
must undertake appropriate training and employ the technical assistance 
necessary to correct problems associated with a proficiency testing 
failure.
    (2) For any unacceptable analyte or testing event score, remedial 
action must be taken and documented, and the documentation must be 
maintained by the laboratory for two years from the date of 
participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
or test in two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.845  Standard; Toxicology.

    (a) Failure to attain a score of at least 80 percent of acceptable 
responses for each analyte in each testing event is unsatisfactory 
analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.

[[Page 547]]

    (e)(1) For any unsatisfactory analyte or test performance or testing 
event for reasons other than a failure to participate, the laboratory 
must undertake appropriate training and employ the technical assistance 
necessary to correct problems associated with a proficiency testing 
failure.
    (2) For any unacceptable analyte or testing event score, remedial 
action must be taken and documented, and the documentation must be 
maintained by the laboratory for two years from the date of 
participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
or test in two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.849  Condition: Hematology.

    The specialty of hematology, for the purpose of proficiency testing, 
is not subdivided into subspecialties of testing.



Sec.  493.851  Standard; Hematology.

    (a) Failure to attain a score of at least 80 percent of acceptable 
responses for each analyte in each testing event is unsatisfactory 
analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (e)(1) For any unsatisfactory analyte or test performance or testing 
event for reasons other than a failure to participate, the laboratory 
must undertake appropriate training and employ the technical assistance 
necessary to correct problems associated with a proficiency testing 
failure.
    (2) For any unacceptable analyte or testing event score, remedial 
action must be taken and documented, and the documentation must be 
maintained by the laboratory for two years from the date of 
participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
in two consecutive events or two out of three consecutive testing events 
is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory performance for two consecutive testing events or two out 
of three consecutive testing events is unsuccessful performance.



Sec.  493.853  Condition: Pathology.

    The specialty of pathology includes, for purposes of proficiency 
testing, the subspecialty of cytology limited to gynecologic 
examinations.



Sec.  493.855  Standard; Cytology: gynecologic examinations.

    To participate successfully in a cytology proficiency testing 
program for gynecologic examinations (Pap smears), the laboratory must 
meet the requirements of paragraphs (a) through (c) of this section.
    (a) The laboratory must ensure that each individual engaged in the 
examination of gynecologic preparations is enrolled in a proficiency 
testing program approved by CMS by January 1, 1995, if available in the 
State in which he or she is employed. The laboratory must ensure that 
each individual is tested at least once per year and obtains a passing 
score. To ensure this

[[Page 548]]

annual testing of individuals, an announced or unannounced testing event 
will be conducted on-site in each laboratory at least once each year. 
Laboratories will be notified of the time of each announced on-site 
testing event at least 30 days prior to each event. Additional testing 
events will be conducted as necessary in each State or region for the 
purpose of testing individuals who miss the on-site testing event and 
for retesting individuals as described in paragraph (b) of this section.
    (b) The laboratory must ensure that each individual participates in 
an annual testing event that involves the examination of a 10-slide test 
set as described in Sec.  493.945. Individuals who fail this testing 
event are retested with another 10-slide test set as described in 
paragraphs (b)(1) and (b)(2) of this section. Individuals who fail this 
second test are subsequently retested with a 20-slide test set as 
described in paragraphs (b)(2) and (b)(3) of this section. Individuals 
are given not more than 2 hours to complete a 10-slide test and not more 
than 4 hours to complete a 20-slide test. Unexcused failure to appear by 
an individual for a retest will result in test failure with resulting 
remediation and limitations on slide examinations as specified in 
(b)(1), (b)(2), and (b)(3) of this section.
    (1) An individual is determined to have failed the annual testing 
event if he or she scores less than 90 percent on a 10-slide test set. 
For an individual who fails an annual proficiency testing event, the 
laboratory must schedule a retesting event which must take place not 
more than 45 days after receipt of the notification of failure.
    (2) An individual is determined to have failed the second testing 
event if he or she scores less than 90 percent on a 10-slide test set. 
For an individual who fails a second testing event, the laboratory must 
provide him or her with documented, remedial training and education in 
the area of failure, and must assure that all gynecologic slides 
evaluated subsequent to the notice of failure are reexamined until the 
individual is again retested with a 20-slide test set and scores at 
least 90 percent. Reexamination of slides must be documented.
    (3) An individual is determined to have failed the third testing 
event if he or she scores less than 90 percent on a 20-slide test set. 
An individual who fails the third testing event must cease examining 
gynecologic slide preparations immediately upon notification of test 
failure and may not resume examining gynecologic slides until the 
laboratory assures that the individual obtains at least 35 hours of 
documented, formally structured, continuing education in diagnostic 
cytopathology that focuses on the examination of gynecologic 
preparations, and until he or she is retested with a 20-slide test set 
and scores at least 90 percent.
    (c) If a laboratory fails to ensure that individuals are tested or 
those who fail a testing event are retested, or fails to take required 
remedial actions as described in paragraphs (b)(1), (b)(2) or (b)(3) of 
this section, CMS will initiate intermediate sanctions or limit the 
laboratory's certificate to exclude gynecologic cytology testing under 
CLIA, and, if applicable, suspend the laboratory's Medicare and Medicaid 
payments for gynecologic cytology testing in accordance with subpart R 
of this part.

[57 FR 7146, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993; 59 
FR 62609, Dec. 6, 1994]



Sec.  493.857  Condition: Immunohematology.

    The specialty of immunohematology includes four subspecialties for 
the purposes of proficiency testing: ABO group and D (Rho) typing; 
unexpected antibody detection; compatibility testing; and antibody 
identification.



Sec.  493.859  Standard; ABO group and D (Rho) typing.

    (a) Failure to attain a score of at least 100 percent of acceptable 
responses for each analyte or test in each testing event is 
unsatisfactory analyte performance for the testing event.
    (b) Failure to attain an overall testing event score of at least 100 
percent is unsatisfactory performance.
    (c) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given

[[Page 549]]

to those laboratories failing to participate in a testing event only 
if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (d) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (e)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unacceptable analyte or unsatisfactory testing event 
score, remedial action must be taken and documented, and the 
documentation must be maintained by the laboratory for two years from 
the date of participation in the proficiency testing event.
    (f) Failure to achieve satisfactory performance for the same analyte 
in two consecutive testing events or two out of three consecutive 
testing events is unsuccessful performance.
    (g) Failure to achieve an overall testing event score of 
satisfactory for two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.



Sec.  493.861  Standard; Unexpected antibody detection.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unsatisfactory testing event score, remedial action must 
be taken and documented, and the documentation must be maintained by the 
laboratory for two years from the date of participation in the 
proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory for two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.



Sec.  493.863  Standard; Compatibility testing.

    (a) Failure to attain an overall testing event score of at least 100 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame

[[Page 550]]

for submitting proficiency testing results of the suspension of patient 
testing and the circumstances associated with failure to perform tests 
on proficiency testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unsatisfactory testing event score, remedial action must 
be taken and documented, and the documentation must be maintained by the 
laboratory for two years from the date of participation in the 
proficiency testing event.
    (e) Failure to achieve an overall testing event score of 
satisfactory for two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.



Sec.  493.865  Standard; Antibody identification.

    (a) Failure to attain an overall testing event score of at least 80 
percent is unsatisfactory performance.
    (b) Failure to participate in a testing event is unsatisfactory 
performance and results in a score of 0 for the testing event. 
Consideration may be given to those laboratories failing to participate 
in a testing event only if--
    (1) Patient testing was suspended during the time frame allotted for 
testing and reporting proficiency testing results;
    (2) The laboratory notifies the inspecting agency and the 
proficiency testing program within the time frame for submitting 
proficiency testing results of the suspension of patient testing and the 
circumstances associated with failure to perform tests on proficiency 
testing samples; and
    (3) The laboratory participated in the previous two proficiency 
testing events.
    (c) Failure to return proficiency testing results to the proficiency 
testing program within the time frame specified by the program is 
unsatisfactory performance and results in a score of 0 for the testing 
event.
    (d)(1) For any unsatisfactory testing event for reasons other than a 
failure to participate, the laboratory must undertake appropriate 
training and employ the technical assistance necessary to correct 
problems associated with a proficiency testing failure.
    (2) For any unsatisfactory testing event score, remedial action must 
be taken and documented, and the documentation must be maintained by the 
laboratory for two years from the date of participation in the 
proficiency testing event.
    (e) Failure to identify the same antibody in two consecutive or two 
out of three consecutive testing events is unsuccessful performance.
    (f) Failure to achieve an overall testing event score of 
satisfactory for two consecutive testing events or two out of three 
consecutive testing events is unsuccessful performance.



      Subpart I_Proficiency Testing Programs for Nonwaived Testing

    Source: 57 FR 7151, Feb. 28, 1992, unless otherwise noted.



Sec.  493.901  Approval of proficiency testing programs.

    In order for a proficiency testing program to receive HHS approval, 
the program must be offered by a private nonprofit organization or a 
Federal or State agency, or entity acting as a designated agent for the 
State. An organization, Federal, or State program seeking approval or 
reapproval for its program for the next calendar year must submit an 
application providing the required information by July 1 of the current 
year. The organization, Federal, or State program must provide technical 
assistance to laboratories seeking to qualify under the program, and 
must, for each specialty, subspecialty, and analyte or test for which it 
provides testing--

[[Page 551]]

    (a) Assure the quality of test samples, appropriately evaluate and 
score the testing results, and identify performance problems in a timely 
manner;
    (b) Demonstrate to HHS that it has--
    (1) The technical ability required to--
    (i) Prepare or purchase samples from manufacturers who prepare the 
samples in conformance with the appropriate good manufacturing practices 
required in 21 CFR parts 606, 640, and 820; and
    (ii) Distribute the samples, using rigorous quality control to 
assure that samples mimic actual patient specimens when possible and 
that samples are homogeneous, except for specific subspecialties such as 
cytology, and will be stable within the time frame for analysis by 
proficiency testing participants;
    (2) A scientifically defensible process for determining the correct 
result for each challenge offered by the program;
    (3) A program of sufficient annual challenge and with the frequency 
specified in Sec. Sec.  493.909 through 493.959 to establish that a 
laboratory has met minimum performance requirements;
    (4) The resources needed to provide Statewide or nationwide reports 
to regulatory agencies on individual's performance for gynecologic 
cytology and on individual laboratory performance on testing events, 
cumulative reports and scores for each laboratory or individual, and 
reports of specific laboratory failures using grading criteria 
acceptable to HHS. These reports must be provided to HHS on a timely 
basis when requested;
    (5) Provisions to include on each proficiency testing program report 
form used by the laboratory to record testing event results, an 
attestation statement that proficiency testing samples were tested in 
the same manner as patient specimens with a signature block to be 
completed by the individual performing the test as well as by the 
laboratory director;
    (6) A mechanism for notifying participants of the PT shipping 
schedule and for participants to notify the proficiency testing program 
within three days of the expected date of receipt of the shipment that 
samples have not arrived or are unacceptable for testing. The program 
must have provisions for replacement of samples that are lost in transit 
or are received in a condition that is unacceptable for testing; and
    (7) A process to resolve technical, administrative, and scientific 
problems about program operations;
    (c) Meet the specific criteria for proficiency testing programs 
listed by specialty, subspecialty, and analyte or test contained in 
Sec. Sec.  493.901 through 493.959 for initial approval and thereafter 
provide HHS, on an annual basis, with the information necessary to 
assure that the proficiency testing program meets the criteria required 
for approval; and
    (d) Comply with all applicable packaging, shipment, and notification 
requirements of 42 CFR part 72.

[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993]



Sec.  493.903  Administrative responsibilities.

    The proficiency testing program must--
    (a)(1) Provide HHS or its designees and participating laboratories 
with an electronic or a hard copy, or both, of reports of proficiency 
testing results and all scores for each laboratory's performance in a 
format as required by and approved by CMS for each CLIA-certified 
specialty, subspecialty, and analyte or test within 60 days after the 
date by which the laboratory must report proficiency testing results to 
the proficiency testing program.
    (2) Provide HHS with reports of PT results and scores of individual 
performance in cytology and provide copies of reports to participating 
individuals, and to all laboratories that employ the individuals, within 
15 working days of the testing event;
    (b) Furnish to HHS cumulative reports on an individual laboratory's 
performance and aggregate data on CLIA-certified laboratories for the 
purpose of establishing a system to make the proficiency testing 
program's results available, on a reasonable basis, upon request of any 
person, and include such explanatory information as may be appropriate 
to assist in the interpretation of the proficiency testing program's 
results;
    (c) Provide HHS with additional information and data upon request 
and

[[Page 552]]

submit such information necessary for HHS to conduct an annual 
evaluation to determine whether the proficiency testing program 
continues to meet the requirements of Sec. Sec.  493.901 through 
493.959;
    (d) Maintain records of laboratories' performance for a period of 
five years or such time as may be necessary for any legal proceedings; 
and
    (e) Provide HHS with an annual report and, if needed, an interim 
report which identifies any previously unrecognized sources of 
variability in kits, instruments, methods, or PT samples, which 
adversely affect the programs' ability to evaluate laboratory 
performance.

[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993]



Sec.  493.905  Nonapproved proficiency testing programs.

    If a proficiency testing program is determined by HHS to fail to 
meet any criteria contained in Sec. Sec.  493.901 through 493.959 for 
approval of the proficiency testing program, CMS will notify the program 
and the program must notify all laboratories enrolled of the nonapproval 
and the reasons for nonapproval within 30 days of the notification.

       Proficiency Testing Programs by Specialty and Subspecialty



Sec.  493.909  Microbiology.

    The subspecialties under the specialty of microbiology for which a 
program may offer proficiency testing are bacteriology, 
mycobacteriology, mycology, parasitology and virology. Specific criteria 
for these subspecialties are found at Sec. Sec.  493.911 through 
493.919.



Sec.  493.911  Bacteriology.

    (a) Types of services offered by laboratories. In bacteriology, for 
proficiency testing purposes, there are five types of laboratories:
    (1) Those that interpret Gram stains or perform primary inoculation, 
or both; and refer cultures to another laboratory appropriately 
certified for the subspecialty of bacteriology for identification;
    (2) Those that use direct antigen techniques to detect an organism 
and may also interpret Gram stains or perform primary inoculation, or 
perform any combination of these;
    (3) Those that, in addition to interpreting Gram stains, performing 
primary inoculations, and using direct antigen tests, also isolate and 
identify aerobic bacteria from throat, urine, cervical, or urethral 
discharge specimens to the genus level and may also perform 
antimicrobial susceptibility tests on selected isolated microorganisms;
    (4) Those that perform the services in paragraph (a)(3) of this 
section and also isolate and identify aerobic bacteria from any source 
to the species level and may also perform antimicrobial susceptibility 
tests; and
    (5) Those that perform the services in paragraph (a)(4) of this 
section and also isolate and identify anaerobic bacteria from any 
source.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing for bacteriology, the annual program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The samples 
may be provided to the laboratory through mailed shipments or, at HHS' 
option, may be provided to HHS or its designee for on-site testing. For 
the types of laboratories specified in paragraph (a) of this section, an 
annual program must include samples that contain organisms that are 
representative of the six major groups of bacteria: anaerobes, 
Enterobacteriaceae, gram-positive bacilli, gram-positive cocci, gram-
negative cocci, and miscellaneous gram-negative bacteria, as 
appropriate. The specific organisms included in the samples may vary 
from year to year. The annual program must include samples for bacterial 
antigen detection, bacterial isolation and identification, Gram stain, 
and antimicrobial susceptibility testing.
    (1) An approved program must furnish HHS with a description of 
samples that it plans to include in its annual program no later than six 
months before each calendar year. At least 50 percent of the samples 
must be mixtures of the principal organism and appropriate normal flora. 
The program must

[[Page 553]]

include other important emerging pathogens (as determined by HHS) and 
either organisms commonly occurring in patient specimens or 
opportunistic pathogens. The program must include the following two 
types of samples; each type of sample must meet the 50 percent mixed 
culture criterion:
    (i) Samples that require laboratories to report only organisms that 
the testing laboratory considers to be a principal pathogen that is 
clearly responsible for a described illness (excluding immuno-
compromised patients). The program determines the reportable isolates, 
including antimicrobial susceptibility for any designated isolate; and
    (ii) Samples that require laboratories to report all organisms 
present. Samples must contain multiple organisms frequently found in 
specimens such as urine, blood, abscesses, and aspirates where multiple 
isolates are clearly significant or where specimens are derived from 
immuno-compromised patients. The program determines the reportable 
isolates.
    (2) An approved program may vary over time. For example, the types 
of organisms that might be included in an approved program over time 
are--

Anaerobes:
    Bacteroides fragilis group
    Clostridium perfringens
    Peptostreptococcus anaerobius
    Enterobacteriaceae
    Citrobacter freundii
    Enterobacter aerogenes
    Escherichia coli
    Klebsiella pneumoniae
    Proteus mirabilis
    Salmonella typhimurium
    Serratia marcescens
    Shigella sonnei
    Yersinia enterocolitica
Gram-positive bacilli:
    Listeria monocytogenes
    Corynebacterium species CDC Group JK
Gram-positive cocci:
    Staphylococcus aureus
    Streptococcus Group A
    Streptococcus Group B
    Streptococcus Group D (S. bovis and enterococcus)
    Streptococcus pneumoniae
Gram-negative cocci:
    Branhamella catarrhalis
    Neisseria gonorrhoeae
    Neisseria meningitidis
Miscellaneous Gram-negative bacteria:
    Campylobacter jejuni
    Haemophilis influenza, Type B
    Pseudomonas aeruginosa

    (3) For antimicrobial susceptibility testing, the program must 
provide at least one sample per testing event that includes gram-
positive or gram-negative strains that have a predetermined pattern of 
sensitivity or resistance to the common antimicrobial agents.
    (c) Evaluation of a laboratory's performance. HHS approves only 
those programs that assess the accuracy of a laboratory's responses in 
accordance with paragraphs (c) (1) through (7) of this section.
    (1) The program determines staining characteristics to be 
interpreted by Gram stain. The program determines the reportable 
bacteria to be detected by direct antigen techniques or isolation. To 
determine the accuracy of a laboratory's response for Gram stain 
interpretation, direct antigen detection, identification, or 
antimicrobial susceptibility testing, the program must compare the 
laboratory's response for each sample with the response which reflects 
agreement of either 80 percent of ten or more referee laboratories or 80 
percent or more of all participating laboratories.
    (2) To evaluate a laboratory's response for a particular sample, the 
program must determine a laboratory's type of service in accordance with 
paragraph (a) of this section. A laboratory must isolate and identify 
the organisms to the same extent it performs these procedures on patient 
specimens. A laboratory's performance will be evaluated on the basis of 
its final answer, for example, a laboratory specified in paragraph 
(a)(3) of this section will be evaluated on the basis of the average of 
its scores for paragraphs (c)(3) through (c)(6) as determined in 
paragraph (c)(7) of this section.
    (3) Since laboratories may incorrectly report the presence of 
organisms in addition to the correctly identified principal organism(s), 
the grading system must provide a means of deducting credit for 
additional erroneous organisms that are reported. Therefore, the total 
number of correct responses for organism isolation and identification 
submitted by the laboratory divided by the number of organisms present 
plus

[[Page 554]]

the number of incorrect organisms reported by the laboratory must be 
multiplied by 100 to establish a score for each sample in each testing 
event. For example, if a sample contained one principal organism and the 
laboratory reported it correctly but reported the presence of an 
additional organism, which was not considered reportable, the sample 
grade would be 1/(1+1)x100=50 percent.
    (4) For antimicrobial susceptibility testing, a laboratory must 
indicate which drugs are routinely included in its test panel when 
testing patient samples. A laboratory's performance will be evaluated 
for only those antibiotics for which service is offered. A correct 
response for each antibiotic will be determined as described in 
Sec. Sec.  493.911(c) (1) using criteria such as the guidelines 
established by the National Committee for Clinical Laboratory Standards. 
Grading is based on the number of correct susceptibility responses 
reported by the laboratory divided by the actual number of correct 
susceptibility responses determined by the program, multiplied by 100. 
For example, if a laboratory offers susceptibility testing for 
Enterobacteriaceae using amikacin, cephalothin, and tobramycin, and the 
organism in the proficiency testing sample is an Enterobacteriaceae, and 
the laboratory reports correct responses for two of three antimicrobial 
agents, the laboratory's grade would be 2/3x100=67 percent.
    (5) The performance criterion for qualitative antigen tests is the 
presence or absence of the bacterial antigen. The score for antigen 
tests is the number of correct responses divided by the number of 
samples to be tested for the antigen, multiplied by 100.
    (6) The performance criteria for Gram stain is staining reaction, 
i.e., gram positive or gram negative. The score for Gram stain is the 
number of correct responses divided by the number of challenges to be 
tested, multiplied by 100.
    (7) The score for a testing event in bacteriology is the average of 
the scores determined under paragraphs (c)(3) through (c)(6) of this 
section kbased on the type of service offered by the laboratory.

[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.913  Mycobacteriology.

    (a) Types of services offered by laboratories. In mycobacteriology, 
there are five types of laboratories for proficiency testing purposes:
    (1) Those that interpret acid-fast stains and refer specimen to 
another laboratory appropriately certified in the subspecialty of 
mycobacteriology;
    (2) Those that interpret acid-fast stains, perform primary 
inoculation, and refer cultures to another laboratory appropriately 
certified in the subspecialty of mycobacteriology for identification;
    (3) Those that interpret acid-fast stains, isolate and perform 
identification and/or antimycobacterial susceptibility of Mycobacterium 
tuberculosis, but refer other mycobacteria species to another laboratory 
appropriately certified in the subspecialty of mycobacteriology for 
identification and/or susceptibility tests;
    (4) Those that interpret acid-fast stains, isolate and identify all 
mycobacteria to the extent required for correct clinical diagnosis, but 
refer antimycobacterial susceptibility tests to another laboratory 
appropriately certified in the subspecialty of mycobacteriology; and
    (5) Those that interpret acid-fast stains, isolate and identify all 
mycobacteria to the extent required for correct clinical diagnosis, and 
perform antimycobacterial susceptibility tests on the organisms 
isolated.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing for mycobacteriology, the annual program must 
provide a minimum of five samples per testing event. There must be at 
least two testing events per year. The samples may be provided through 
mailed shipments or, at HHS' option, provided to HHS or its designee for 
on-site testing events. For types of laboratories specified in 
paragraphs (a)(1) and (a) (3) through (5) of this section, an annual 
program must include samples that contain species that are 
representative of the 5

[[Page 555]]

major groups (complexes) of mycobacteria encountered in human specimens. 
The specific mycobacteria included in the samples may vary from year to 
year.
    (1) An approved program must furnish HHS and its agents with a 
description of samples that it plans to include in its annual program no 
later than six months before each calendar year. At least 50 percent of 
the samples must be mixtures of the principal mycobacteria and 
appropriate normal flora. The program must include mycobacteria commonly 
occurring in patient specimens and other important emerging mycobacteria 
(as determined by HHS). The program determines the reportable isolates 
and correct responses for antimycobacterial susceptibility for any 
designated isolate.
    (2) An approved program may vary over time. For example, the types 
of mycobacteria that might be included in an approved program over time 
are--

TB
    Mycobacterium tuberculosis
    Mycobacterium bovis
Group I
    Mycobacterium kansasii
Group II
    Mycobacterium szulgai
Group III
    Mycobacterium avium-intracellulare
    Mycobacterium terrae
Group IV
    Mycobacterium fortuitum

    (3) For antimycobacterial susceptibility testing, the program must 
provide at least one sample per testing event that includes 
mycobacterium tuberculosis that has a predetermined pattern of 
sensitivity or resistance to the common antimycobacterial agents.
    (4) For laboratories specified in paragraphs (a)(1) and (a)(2), the 
program must provide at least five samples per testing event that 
includes challenges that are acid-fast and challenges which do not 
contain acid-fast organisms.
    (c) Evaluation of a laboratory's performance. HHS approves only 
those programs that assess the accuracy of a laboratory's response in 
accordance with paragraphs (c)(1) through (6) of this section.
    (1) The program determines the reportable mycobacteria to be 
detected by acid-fast stain, for isolation and identification, and for 
antimycobacterial susceptibility. To determine the accuracy of a 
laboratory's response, the program must compare the laboratory's 
response for each sample with the response that reflects agreement of 
either 80 percent of ten or more referee laboratories or 80 percent or 
more of all participating laboratories.
    (2) To evaluate a laboratory's response for a particular sample, the 
program must determine a laboratory's type of service in accordance with 
paragraph (a) of this section. A laboratory must interpret acid-fast 
stains and isolate and identify the organisms to the same extent it 
performs these procedures on patient specimens. A laboratory's 
performance will be evaluated on the basis of the average of its scores 
as determined in paragraph (c)(6) of this section.
    (3) Since laboratories may incorrectly report the presence of 
organisms in addition to the correctly identified principal organism(s), 
the grading system must provide a means of deducting credit for 
additional erroneous organisms reported. Therefore, the total number of 
correct responses submitted by the laboratory divided by the number of 
organisms present plus the number of incorrect organisms reported by the 
laboratory must be multiplied by 100 to establish a score for each 
sample in each testing event. For example, if a sample contained one 
principal organism and the laboratory reported it correctly but reported 
the presence of an additional organism, which was not present, the 
sample grade would be

1 / (1 + 1) x 100 = 50 percent
    (4) For antimycobacterial susceptibility testing, a laboratory must 
indicate which drugs are routinely included in its test panel when 
testing patient samples. A laboratory's performance will be evaluated 
for only those antibiotics for which susceptibility testing is routinely 
performed on patient specimens. A correct response for each antibiotic 
will be determined as described in Sec.  493.913(c)(1). Grading is based 
on the number of correct susceptibility responses reported by the 
laboratory divided by the actual number of correct susceptibility 
responses as determined by the program, multiplied

[[Page 556]]

by 100. For example, if a laboratory offers susceptibility testing using 
three antimycobacterial agents and the laboratory reports correct 
response for two of the three antimycobacterial agents, the laboratory's 
grade would be \2/3\ x 100 = 67 percent.
    (5) The performance criterion for qualitative tests is the presence 
or absence of acid-fast organisms. The score for acid-fast organism 
detection is the number of correct responses divided by the number of 
samples to be tested, multiplied by 100.
    (6) The score for a testing event in mycobacteriology is the average 
of the scores determined under paragraphs (c)(3) through (c)(5) of this 
section based on the type of service offered by the laboratory.

[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.915  Mycology.

    (a) Types of services offered by laboratories. In mycology, there 
are four types of laboratories for proficiency testing purposes that may 
perform different levels of service for yeasts, dimorphic fungi, 
dermatophytes, and aerobic actinomycetes:
    (1) Those that isolate and identify only yeasts and/or dermatophytes 
to the genus level;
    (2) Those that isolate and identify yeasts and/or dermatophytes to 
the species level;
    (3) Those that isolate and perform identification of all organisms 
to the genus level; and
    (4) Those that isolate and perform identification of all organisms 
to the species level.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing for mycology, the annual program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The samples 
may be provided through mailed shipments or, at HHS' option, may be 
provided to HHS or its designee for on-site testing. An annual program 
must include samples that contain organisms that are representative of 
five major groups of fungi: Yeast or yeast-like fungi; dimorphic fungi; 
dematiaceous fungi; dermatophytes; and saprophytes, including 
opportunistic fungi. The specific fungi included in the samples may vary 
from year to year.
    (1) An approved program must, before each calendar year, furnish HHS 
with a description of samples that it plans to include in its annual 
program no later than six months before each calendar year. At least 50 
percent of the samples must be mixtures of the principal organism and 
appropriate normal background flora. Other important emerging pathogens 
(as determined by HHS) and organisms commonly occurring in patient 
specimens must be included periodically in the program.
    (2) An approved program may vary over time. As an example, the types 
of organisms that might be included in an approved program over time 
are--

Candida albicans
Candida (other species)
Cryptococcus neoformans
Sporothrix schenckii
Exophiala jeanselmei
Fonsecaea pedrosoi
Microsporum sp.
Acremonium sp.
Trichophvton sp.
Aspergillus fumigatus
Nocardia sp.
Blastomyces dermatitidis \1\
Zygomycetes sp.
    \1\ Note: Provided as a nonviable sample.

    (c) Evaluation of a laboratory's performance. HHS approves only 
those programs that assess the accuracy of a laboratory's response, in 
accordance with paragraphs (c)(1) through (5) of this section.
    (1) The program determines the reportable organisms. To determine 
the accuracy of a laboratory's response, the program must compare the 
laboratory's response for each sample with the response that reflects 
agreement of either 80 percent of ten or more referee laboratories or 80 
percent or more of all participating laboratories.
    (2) To evaluate a laboratory's response for a particular sample, the 
program must determine a laboratory's type of service in accordance with 
paragraph (a) of this section. A laboratory must isolate and identify 
the organisms to the same extent it performs these procedures on patient 
specimens.

[[Page 557]]

    (3) Since laboratories may incorrectly report the presence of 
organisms in addition to the correctly identified principal organism(s), 
the grading system must deduct credit for additional erroneous organisms 
reported. Therefore, the total number of correct responses submitted by 
the laboratory divided by the number of organisms present plus the 
number of incorrect organisms reported by the laboratory must be 
multiplied by 100 to establish a score for each sample in each shipment 
or testing event. For example, if a sample contained one principal 
organism and the laboratory reported it correctly but reported the 
presence of an additional organism, which was not present, the sample 
grade would be 1/(1+1)x100=50 percent.
    (4) The score for the antigen tests is the number of correct 
responses divided by the number of samples to be tested for the antigen, 
multiplied by 100.
    (5) The score for a testing event is the average of the sample 
scores as determined under paragraph (c)(3) or (c)(4), or both, of this 
section.

[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5228, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.917  Parasitology.

    (a) Types of services offered by laboratories. In parasitology there 
are two types of laboratories for proficiency testing purposes--
    (1) Those that determine the presence or absence of parasites by 
direct observation (wet mount) and/or pinworm preparations and, if 
necessary, refer specimens to another laboratory appropriately certified 
in the subspecialty of parasitology for identification;
    (2) Those that identify parasites using concentration preparations 
and/or permanent stains.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing in parasitology, a program must provide a minimum of 
five samples per testing event. There must be at least three testing 
events at approximately equal intervals per year. The samples may be 
provided through mailed shipments or, at HHS's option, may be provided 
to HHS or its designee for on-site testing. An annual program must 
include samples that contain parasites that are commonly encountered in 
the United States as well as those recently introduced into the United 
States. Other important emerging pathogens (as determined by HHS) and 
parasites commonly occurring in patient specimens must be included 
periodically in the program.
    (1) An approved program must, before each calendar year furnish HHS 
with a description of samples that it plans to include in its annual 
program no later than six months before each calendar year. Samples must 
include both formalinized specimens and PVA (polyvinyl alcohol) fixed 
specimens as well as blood smears, as appropriate for a particular 
parasite and stage of the parasite. The majority of samples must contain 
protozoa or helminths or a combination of parasites. Some samples must 
be devoid of parasites.
    (2) An approved program may vary over time. As an example, the types 
of parasites that might be included in an approved program over time 
are--

Enterobius vermicularis
Entamoeba histolytica
Entamoeba coli
Giardia lamblia
Endolimax nana
Dientamoeba fragilis
Iodamoeba butschli
Chilomastix mesnili
Hookworm
Ascaris lumbricoides
Strongyloides stercoralis
Trichuris trichiura
Diphyllobothrium latum
Cryptosporidium sp.
Plasmodium falciparum

    (3) For laboratories specified in paragraph (a)(1) of this section, 
the program must provide at least five samples per testing event that 
include challenges which contain parasites and challenges that are 
devoid of parasites.
    (c) Evaluation of a laboratory's performance. HHS approves only 
those programs that assess the accuracy of a laboratory's responses in 
accordance with paragraphs (c)(1) through (6) of this section.
    (1) The program must determine the reportable parasites. It may 
elect to establish a minimum number of parasites to be identified in 
samples before they are reported. Parasites found in rare numbers by 
referee laboratories are not

[[Page 558]]

considered in scoring a laboratory's performance; such findings are 
neutral. To determine the accuracy of a laboratory's response, the 
program must compare the laboratory's response with the response that 
reflects agreement of either 80 percent of ten or more referee 
laboratories or 80 percent or more of all participating laboratories.
    (2) To evaluate a laboratory's response for a particular sample, the 
program must determine a laboratory's type of service in accordance with 
paragraph (a) of this section. A laboratory must determine the presence 
or absence of a parasite(s) or concentrate and identify the parasites to 
the same extent it performs these procedures on patient specimens.
    (3) Since laboratories may incorrectly report the presence of 
parasites in addition to the correctly identified principal parasite(s), 
the grading system must deduct credit for these additional erroneous 
parasites reported and not found in rare numbers by the program's 
referencing process. Therefore, the total number of correct responses 
submitted by the laboratory divided by the number of parasites present 
plus the number of incorrect parasites reported by the laboratory must 
be multiplied by 100 to establish a score for each sample in each 
testing event. For example, if a sample contained one principal parasite 
and the laboratory reported it correctly but reported the presence of an 
additional parasite, which was not present, the sample grade would be

1/(1+1)x100=50 percent.
    (4) The criterion for acceptable performance for qualitative 
parasitology examinations is presence or absence of a parasite(s).
    (5) The score for parasitology is the number of correct responses 
divided by the number of samples to be tested, multiplied by 100.
    (6) The score for a testing event is the average of the sample 
scores as determined under paragraphs (c)(3) through (c)(5) of this 
section.

[57 FR 7151, Feb. 28, 1992, as amended at 68 FR 3702, Jan. 24, 2003]



Sec.  493.919  Virology.

    (a) Types of services offered by laboratories. In virology, there 
are two types of laboratories for proficiency testing purposes--
    (1) Those that only perform tests that directly detect viral 
antigens or structures, either in cells derived from infected tissues or 
free in fluid specimens; and
    (2) Those that are able to isolate and identify viruses and use 
direct antigen techniques.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing in virology, a program must provide a minimum of 
five samples per testing event. There must be at least three testing 
events at approximately equal intervals per year. The samples may be 
provided to the laboratory through mailed shipments or, at HHS's option, 
may be provided to HHS or its designee for on-site testing. An annual 
program must include viral species that are the more commonly identified 
viruses. The specific organisms found in the samples may vary from year 
to year. The annual program must include samples for viral antigen 
detection and viral isolation and identification.
    (1) An approved program must furnish HHS with a description of 
samples that it plans to include in its annual program no later than six 
months before each calendar year. The program must include other 
important emerging viruses (as determined by HHS) and viruses commonly 
occurring in patient specimens.
    (2) An approved program may vary over time. For example, the types 
of viruses that might be included in an approved program over time are 
the more commonly identified viruses such as Herpes simplex, respiratory 
syncytial virus, adenoviruses, enteroviruses, and cytomegaloviruses.
    (c) Evaluation of laboratory's performance. HHS approves only those 
programs that assess the accuracy of a laboratory's response in 
accordance with paragraphs (c)(1) through (5) of this section.
    (1) The program determines the reportable viruses to be detected by 
direct antigen techniques or isolated by laboratories that perform viral 
isolation procedures. To determine the accuracy of a laboratory's 
response, the

[[Page 559]]

program must compare the laboratory's response for each sample with the 
response that reflects agreement of either 80 percent of ten or more 
referee laboratories or 80 percent or more of all participating 
laboratories.
    (2) To evaluate a laboratory's response for a particular sample, the 
program must determine a laboratory's type of service in accordance with 
paragraph (a) of this section. A laboratory must isolate and identify 
the viruses to the same extent it performs these procedures on patient 
specimens.
    (3) Since laboratories may incorrectly report the presence of 
viruses in addition to the correctly identified principal virus, the 
grading system must provide a means of deducting credit for additional 
erroneous viruses reported. Therefore, the total number of correct 
responses determined by virus culture techniques submitted by the 
laboratory divided by the number of viruses present plus the number of 
incorrect viruses reported by the laboratory must be multiplied by 100 
to establish a score for each sample in each testing event. For example, 
if a sample contained one principal virus and the laboratory reported it 
correctly but reported the presence of an additional virus, which was 
not present, the sample grade would be 1/(1+1)x100=50 percent.
    (4) The performance criterion for qualitative antigen tests is 
presence or absence of the viral antigen. The score for the antigen 
tests is the number of correct responses divided by the number of 
samples to be tested for the antigen, multiplied by 100.
    (5) The score for a testing event is the average of the sample 
scores as determined under paragraph (c)(3) and (c)(4) of this section.

[57 FR 7151, Feb. 28, 1992, as amended at 68 FR 3702, Jan. 24, 2003]



Sec.  493.921  Diagnostic immunology.

    The subspecialties under the specialty of immunology for which a 
program may offer proficiency testing are syphilis serology and general 
immunology. Specific criteria for these subspecialties are found at 
Sec. Sec.  493.923 and 493.927.



Sec.  493.923  Syphilis serology.

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing in syphilis serology, a program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The samples 
may be provided through mailed shipments or, at HHS' option, may be 
provided to HHS or its designee for on-site testing. An annual program 
must include samples that cover the full range of reactivity from highly 
reactive to non-reactive.
    (b) Evaluation of test performance. HHS approves only those programs 
that assess the accuracy of a laboratory's responses in accordance with 
paragraphs (b)(1) through (4) of this section.
    (1) To determine the accuracy of a laboratory's response for 
qualitative and quantitative syphilis tests, the program must compare 
the laboratory's response with the response that reflects agreement of 
either 80 percent of ten or more referee laboratories or 80 percent or 
more of all participating laboratories. The proficiency testing program 
must indicate the minimum concentration, by method, that will be 
considered as indicating a positive response. The score for a sample in 
syphilis serology is the average of scores determined under paragraphs 
(b)(2) and (b)(3) of this section.
    (2) For quantitative syphilis tests, the program must determine the 
correct response for each method by the distance of the response from 
the target value. After the target value has been established for each 
response, the appropriateness of the response must be determined by 
using fixed criteria. The criterion for acceptable performance for 
quantitative syphilis serology tests is the target value 1 dilution.
    (3) The criterion for acceptable performance for qualitative 
syphilis serology tests is reactive or nonreactive.
    (4) To determine the overall testing event score, the number of 
correct responses must be averaged using the following formula:

[[Page 560]]

[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.927  General immunology.

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing for immunology, the annual program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The annual 
program must provide samples that cover the full range of reactivity 
from highly reactive to nonreactive. The samples may be provided through 
mailed shipments or, at HHS' option, may be provided to HHS or its 
designee for on-site testing.
    (b) Challenges per testing event. The minimum number of challenges 
per testing event the program must provide for each analyte or test 
procedure is five. Analytes or tests for which laboratory performance is 
to be evaluated include:

                        Analyte or Test Procedure

Alpha-l antitrypsin
Alpha-fetoprotein (tumor marker)
Antinuclear antibody
Antistreptolysin O
Anti-human immunodeficiency virus (HIV)
Complement C3
Complement C4
Hepatitis markers (HBsAg, anti-HBc, HBeAg)
IgA
IgG
IgE
IgM
Infectious mononucleosis
Rheumatoid factor
Rubella

    (c) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
responses in accordance with paragraphs (c)(1) through (5) of this 
section.
    (1) To determine the accuracy of a laboratory's response for 
quantitative and qualitative immunology tests or analytes, the program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 80 percent of ten or more 
referee laboratories or 80 percent or more of all participating 
laboratories. The proficiency testing program must indicate the minimum 
concentration that will be considered as indicating a positive response. 
The score for a sample in general immunology is either the score 
determined under paragraph (c)(2) or (3) of this section.
    (2) For quantitative immunology analytes or tests, the program must 
determine the correct response for each analyte by the distance of the 
response from the target value. After the target value has been 
established for each response, the appropriateness of the response must 
be determined by using either fixed criteria or the number of standard 
deviations (SDs) the response differs from the target value.

                   Criteria for Acceptable Performance

    The criteria for acceptable performance are--

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
Alpha-1 antitrypsin.......................  Target value 3 SD.
Alpha-fetoprotein (tumor marker)..........  Target value 3 SD.
Antinuclear antibody......................  Target value 2 dilutions or
                                             positive or negative.
Antistreptolysin O........................  Target value 2 dilution or
                                             positive or negative.
Anti-Human Immunodeficiency virus.........  Reactive or nonreactive.
Complement C3.............................  Target value 3 SD.
Complement C4.............................  Target value 3 SD.
Hepatitis (HBsAg, anti-HBc, HBeAg)........  Reactive (positive) or
                                             nonreactive (negative).
IgA.......................................  Target value 3 SD.
IgE.......................................  Target value 3 SD.
IgG.......................................  Target value 25%.
IgM.......................................  Target value 3 SD.
Infectious mononucleosis..................  Target value 2 dilutions or
                                             positive or negative.
Rheumatoid factor.........................  Target value 2 dilutions or
                                             positive or negative.
Rubella...................................  Target value 2 dilutions or
                                             immune or nonimmune or
                                             positive or negative.
------------------------------------------------------------------------

    (3) The criterion for acceptable performance for qualitative general 
immunology tests is positive or negative.

[[Page 561]]

    (4) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (5) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.929  Chemistry.

    The subspecialties under the specialty of chemistry for which a 
proficiency testing program may offer proficiency testing are routine 
chemistry, endocrinology, and toxicology. Specific criteria for these 
subspecialties are listed in Sec. Sec.  493.931 through 493.939.



Sec.  493.931  Routine chemistry.

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing for routine chemistry, a program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The annual 
program must provide samples that cover the clinically relevant range of 
values that would be expected in patient specimens. The specimens may be 
provided through mailed shipments or, at HHS' option, may be provided to 
HHS or its designee for on-site testing.
    (b) Challenges per testing event. The minimum number of challenges 
per testing event a program must provide for each analyte or test 
procedure listed below is five serum, plasma or blood samples.

                        Analyte or Test Procedure

Alanine aminotransferase (ALT/SGPT)
Albumin
Alkaline phosphatase
Amylase
Aspartate aminotransferase (AST/SGOT)
Bilirubin, total
Blood gas (pH, pO2, and pCO2)
Calcium, total
Chloride
Cholesterol, total
Cholesterol, high density lipoprotein
Creatine kinase
Creatine kinase, isoenzymes
Creatinine
Glucose (Excluding measurements on devices cleared by FDA for home use)
Iron, total
Lactate dehydrogenase (LDH)
LDH isoenzymes
Magnesium
Potassium
Sodium
Total Protein
Triglycerides
Urea Nitrogen
Uric Acid

    (c) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
responses in accordance with paragraphs (c)(1) through (5) of this 
section.
    (1) To determine the accuracy of a laboratory's response for 
qualitative and quantitative chemistry tests or analytes, the program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 80 percent of ten or more 
referee laboratories or 80 percent

[[Page 562]]

or more of all participating laboratories. The score for a sample in 
routine chemistry is either the score determined under paragraph (c)(2) 
or (3) of this section.
    (2) For quantitative chemistry tests or analytes, the program must 
determine the correct response for each analyte by the distance of the 
response from the target value. After the target value has been 
established for each response, the appropriateness of the response must 
be determined by using either fixed criteria based on the percentage 
difference from the target value or the number of standard deviations 
(SDs) the response differs from the target value.

                   Criteria for Acceptable Performance

    The criteria for acceptable performance are--

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
Alanine aminotransferase (ALT/SGPT).......  Target value 20%.
Albumin...................................  Target value 10%.
Alkaline phosphatase......................  Target value 30%.
Amylase...................................  Target value 30%.
Aspartate aminotransferase (AST/SGOT).....  Target value 20%.
Bilirubin, total..........................  Target value 0.4 mg/dL or 20%
                                             (greater).
Blood gas pO2.............................  Target value 3 SD.
pCO2......................................  Target value 5 mm Hg or 8%
                                             (greater).
pH........................................  Target value 0.04.
Calcium, total............................  Target value 1.0 mg/dL.
Chloride..................................  Target value 5%.
Cholesterol, total........................  Target value 10%.
Cholesterol, high density lipoprotein.....  Target value 30%.
Creatine kinase...........................  Target value 30%.
Creatine kinase isoenzymes................  MB elevated (presence or
                                             absence) or Target value
                                             3SD.
Creatinine................................  Target value 0.3 mg/dL or 15%
                                             (greater).
Glucose (excluding glucose performed on     Target value 6 mg/dl or 10%
                                             (greater).
Iron, total...............................  Target value 20%.
Lactate dehydrogenase (LDH)...............  Target value 20%.
LDH isoenzymes............................  LDH1/LDH2 (+ or -) or Target
                                             value 30%.
Magnesium.................................  Target value 25%.
Potassium.................................  Target value 0.5 mmol/L.
Sodium....................................  Target value 4 mmol/L.
Total Protein.............................  Target value 10%.
Triglycerides.............................  Target value 25%.
Urea nitrogen.............................  Target value 2 mg/dL or 9%
                                             (greater).
Uric acid.................................  Target value 17%.
------------------------------------------------------------------------

    (3) The criterion for acceptable performance for qualitative routine 
chemistry tests is positive or negative.
    (4) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (5) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[57 FR 7151, Feb. 28, 1992, as amended at 68 FR 3702, Jan. 24, 2003]



Sec.  493.933  Endocrinology.

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing for endocrinology, a program must provide a minimum 
of five samples per testing event. There must be at least three testing 
events at approximately equal intervals per year. The annual program 
must provide samples that cover the clinically relevant range of values 
that would be expected

[[Page 563]]

in patient specimens. The samples may be provided through mailed 
shipments or, at HHS' option, may be provided to HHS or its designee for 
on-site testing.
    (b) Challenges per testing event. The minimum number of challenges 
per testing event a program must provide for each analyte or test 
procedure is five serum, plasma, blood, or urine samples.

                             Analyte or Test

Cortisol
Free Thyroxine
Human Chorionic gonadotropin (excluding urine pregnancy tests done by 
visual color comparison categorized as waived tests)
T3 Uptake
Triiodothyronine
Thyroid-stimulating hormone
Thyroxine

    (c) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
responses in accordance with paragraphs (c)(1) through (5) of this 
section.
    (1) To determine the accuracy of a laboratory's response for 
qualitative and quantitative endocrinology tests or analytes, a program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 80 percent of ten or more 
referee laboratories or 80 percent or more of all participating 
laboratories. The score for a sample in endocrinology is either the 
score determined under paragraph (c)(2) or (c)(3) of this section.
    (2) For quantitative endocrinology tests or analytes, the program 
must determine the correct response for each analyte by the distance of 
the response from the target value. After the target value has been 
established for each response, the appropriateness of the response must 
be determined by using either fixed criteria based on the percentage 
difference from the target value or the number of standard deviations 
(SDs) the response differs from the target value.

                   Criteria for Acceptable Performance

    The criteria for acceptable performance are--

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
Cortisol..................................  Target value 25%.
Free Thyroxine............................  Target value 3 SD.
Human Chorionic Gonadotropin (excluding     Target value 3 SD positive or
 color comparison categorized as waived      negative.
 tests).
T3 Uptake.................................  Target value 3 SD.
Triiodothyronine..........................  Target value 3 SD.
Thyroid-stimulating hormone...............  Target value 3 SD.
Thyroxine.................................  Target value 20% or 1.0 mcg/dL
                                             (greater).
------------------------------------------------------------------------

    (3) The criterion for acceptable performance for qualitative 
endocrinology tests is positive or negative.
    (4) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (5) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[[Page 564]]



[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.937  Toxicology.

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing for toxicology, the annual program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The annual 
program must provide samples that cover the clinically relevant range of 
values that would be expected in specimens of patients on drug therapy 
and that cover the level of clinical significance for the particular 
drug. The samples may be provided through mailed shipments or, at HHS' 
option, may be provided to HHS or its designee for on-site testing.
    (b) Challenges per testing event. The minimum number of challenges 
per testing event a program must provide for each analyte or test 
procedure is five serum, plasma, or blood samples.

                        Analyte or Test Procedure

Alcohol (blood)
Blood lead
Carbamazepine
Digoxin
Ethosuximide
Gentamicin
Lithium
Phenobarbital
Phenytoin
Primidone
Procainamide
 (and metabolite)
Quinidine
Theophylline
Tobramycin
Valproic Acid

    (c) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
responses in accordance with paragraphs (c)(1) through (4) of this 
section.
    (1) To determine the accuracy of a laboratory's responses for 
quantitative toxicology tests or analytes, the program must compare the 
laboratory's response for each analyte with the response that reflects 
agreement of either 80 percent of ten or more referee laboratories or 80 
percent or more of all participating laboratories. The score for a 
sample in toxicology is the score determined under paragraph (c)(2) of 
this section.
    (2) For quantitative toxicology tests or analytes, the program must 
determine the correct response for each analyte by the distance of the 
response from the target value. After the target value has been 
established for each response, the appropriateness of the response must 
be determined by using fixed criteria based on the percentage difference 
from the target value

                   Criteria for Acceptable Performance

    The criteria for acceptable performance are:

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
Alcohol, blood............................  Target Value 25%.
Blood lead................................  Target Value 10% or 4 mcg/dL
                                             (greater).
Carbamazepine.............................  Target Value 25%.
Digoxin...................................  Target Value 20% or 0.2 ng/mL
                                             (greater).
Ethosuximide..............................  Target Value 20%.
Gentamicin................................  Target Value 25%.
Lithium...................................  Target Value 0.3 mmol/L or 20%
                                             (greater).
Phenobarbital.............................  Target Value 20%
Phenytoin.................................  Target Value 25%.
Primidone.................................  Target Value 25%.
Procainamide (and metabolite).............  Target Value 25%.
Quinidine.................................  Target Value 25%.
Tobramycin................................  Target Value 25%.
Theophylline..............................  Target Value 25%.
Valproic Acid.............................  Target Value 25%.
------------------------------------------------------------------------

    (3) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (4) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula:

[[Page 565]]

[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.941  Hematology (including routine hematology and coagulation).

    (a) Program content and frequency of challenge. To be approved for 
proficiency testing for hematology, a program must provide a minimum of 
five samples per testing event. There must be at least three testing 
events at approximately equal intervals per year. The annual program 
must provide samples that cover the full range of values that would be 
expected in patient specimens. The samples may be provided through 
mailed shipments or, at HHS' option, may be provided to HHS and or its 
designee for on-site testing.
    (b) Challenges per testing event. The minimum number of challenges 
per testing event a program must provide for each analyte or test 
procedure is five.

                        Analyte or Test Procedure

Cell identification or white blood cell differential
Erythrocyte count
Hematocrit (excluding spun microhematocrit)
Hemoglobin
Leukocyte count
Platelet count
Fibrinogen
Partial thromboplastin time
Prothrombin time

    (1) An approved program for cell identification may vary over time. 
The types of cells that might be included in an approved program over 
time are--

Neutrophilic granulocytes
Eosinophilic granulocytes
Basophilic granulocytes
Lymphocytes
Monocytes
Major red and white blood cell abnormalities
Immature red and white blood cells

    (2) White blood cell differentials should be limited to the 
percentage distribution of cellular elements listed above.
    (c) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
responses in accordance with paragraphs (c) (1) through (5) of this 
section.
    (1) To determine the accuracy of a laboratory's responses for 
qualitative and quantitative hematology tests or analytes, the program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 80 percent of ten or more 
referee laboratories or 80 percent or more of all participating 
laboratories. The score for a sample in hematology is either the score 
determined under paragraph (c) (2) or (3) of this section.
    (2) For quantitative hematology tests or analytes, the program must 
determine the correct response for each analyte by the distance of the 
response from the target value. After the target value has been 
established for each response, the appropriateness of the response is 
determined using either fixed criteria based on the percentage 
difference from the target value or the number of standard deviations 
(SDs) the response differs from the target value.

                   Criteria for Acceptable Performance

    The criteria for acceptable performance are:

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
Cell identification.......................  90% or greater consensus on
                                             identification.
White blood cell differential.............  Target 3SD based on the
                                             percentage of different
                                             types of white blood cells
                                             in the samples.
Erythrocyte count.........................  Target 6%.
Hematocrit (Excluding spun hematocrits)...  Target 6%.
Hemoglobin................................  Target 7%.
Leukocyte count...........................  Target 15%.
Platelet count............................  Target 25%.
Fibrinogen................................  Target 20%.
Partial thromboplastin time...............  Target 15%.
Prothrombin time..........................  Target 15%.
------------------------------------------------------------------------


[[Page 566]]

    (3) The criterion for acceptable performance for the qualitative 
hematology test is correct cell identification.
    (4) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (5) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.022


[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.945  Cytology; gynecologic examinations.

    (a) Program content and frequency of challenge. (1) To be approved 
for proficiency testing for gynecologic examinations (Pap smears) in 
cytology, a program must provide test sets composed of 10- and 20-glass 
slides. Proficiency testing programs may obtain slides for test sets 
from cytology laboratories, provided the slides have been retained by 
the laboratory for the required period specified in Sec. Sec.  
493.1105(a)(7)(i)(A) and 493.1274(f)(2). If slide preparations are still 
subject to retention by the laboratory, they may be loaned to a 
proficiency testing program if the program provides the laboratory with 
documentation of the loan of the slides and ensures that slides loaned 
to it are retrievable upon request. Each test set must include at least 
one slide representing each of the response categories described in 
paragraph (b)(3)(ii)(A) of this section, and test sets should be 
comparable so that equitable testing is achieved within and between 
proficiency testing providers.
    (2) To be approved for proficiency testing in gynecologic cytology, 
a program must provide announced and unannounced on-site testing for 
each individual at least once per year and must provide an initial 
retesting event for each individual within 45 days after notification of 
test failure and subsequent retesting events within 45 days after 
completion of remedial action described in Sec.  493.855.
    (b) Evaluation of an individual's performance. HHS approves only 
those programs that assess the accuracy of each individual's responses 
on both 10- and 20-slide test sets in which the slides have been 
referenced as specified in paragraph (b)(1) of this section.
    (1) To determine the accuracy of an individual's response on a 
particular challenge (slide), the program must compare the individual's 
response for each slide preparation with the response that reflects the 
predetermined consensus agreement or confirmation on the diagnostic 
category, as described in the table in paragraph (b)(3)(ii)(A) of this 
section. For all slide preparations, a 100% consensus agreement among a 
minimum of three physicians certified in anatomic pathology is required. 
In addition, for premalignant and malignant slide preparations, 
confirmation by tissue biopsy is required either by comparison of the 
reported biopsy results or reevaluation of biopsy slide material by a 
physician certified in anatomic pathology.
    (2) An individual qualified as a technical supervisor under Sec.  
493.1449 (b) or

[[Page 567]]

(k) who routinely interprets gynecologic slide preparations only after 
they have been examined by a cytotechnologist can either be tested using 
a test set that has been screened by a cytotechnologist in the same 
laboratory or using a test set that has not been screened. A technical 
supervisor who screens and interprets slide preparations that have not 
been previously examined must be tested using a test set that has not 
been previously screened.
    (3) The criteria for acceptable performance are determined by using 
the scoring system in paragraphs (b)(3) (i) and (ii) of this section.
    (i) Each slide set must contain 10 or 20 slides with point values 
established for each slide preparation based on the significance of the 
relationship of the interpretation of the slide to a clinical condition 
and whether the participant in the testing event is a cytotechnologist 
qualified under Sec. Sec.  493.1469 or 493.1483 or functioning as a 
technical supervisor in cytology qualified under Sec.  493.1449 (b) or 
(k) of this part.
    (ii) The scoring system rewards or penalizes the participants in 
proportion to the distance of their answers from the correct response or 
target diagnosis and the penalty or reward is weighted in proportion to 
the severity of the lesion.
    (A) The four response categories for reporting proficiency testing 
results and their descriptions are as follows:

------------------------------------------------------------------------
             Category                            Description
------------------------------------------------------------------------
A.................................  Unsatisfactory for diagnosis due to:
                                    (1) Scant cellularity.
                                    (2) Air drying.
                                    (3) Obscuring material (blood,
                                     inflammatory cells, or lubricant).
B.................................  Normal or Benign Changes--includes:
                                    (1) Normal, negative or within
                                     normal limits.
                                    (2) Infection other than Human
                                     Papillomavirus (HPV) (e.g.,
                                     Trichomonas vaginalis, changes or
                                     morphology consistent with Candida
                                     spp., Actinomyces spp. or Herpes
                                     simplex virus).
                                    (3) Reactive and reparative changes
                                     (e.g., inflammation, effects of
                                     chemotherapy or radiation).
C.................................  Low Grade Squamous Intraepithelial
                                     Lesion--includes:
                                    (1) Cellular changes associated with
                                     HPV.
                                    (2) Mild dysplasia/CIN-1.
D.................................  High Grade Lesion and Carcinoma--
                                     includes:
                                    (1) High grade squamous
                                     intraepithelial lesions which
                                     include moderate dysplasia/CIN-2
                                     and severe dysplasia/carcinoma in-
                                     situ/CIN-3.
                                    (2) Squamous cell carcinoma.
                                    (3) Adenocarcinoma and other
                                     malignant neoplasms.
------------------------------------------------------------------------

    (B) In accordance with the criteria for the scoring system, the 
charts in paragraphs (b)(3)(ii)(C) and (D) of this section, for 
technical supervisors and cytotechnologists, respectively, provide a 
maximum of 10 points for a correct response and a maximum of minus five 
(-5) points for an incorrect response on a 10-slide test set. For 
example, if the correct response on a slide is ``high grade squamous 
intraepithelial lesion'' (category ``D'' on the scoring system chart) 
and an examinee calls it ``normal or negative'' (category ``B'' on the 
scoring system chart), then the examinee's point value on that slide is 
calculated as minus five (-5). Each slide is scored individually in the 
same manner. The individual's score for the testing event is determined 
by adding the point value achieved for each slide preparation, dividing 
by the total points for the testing event and multiplying by 100.
    (C) Criteria for scoring system for a 10-slide test set. (See table 
at (b)(3)(ii)(A) of this section for a description of the response 
categories.) For technical supervisors qualified under Sec.  493.1449(b) 
or (k):

------------------------------------------------------------------------
                Examinee's response:                   A    B    C    D
------------------------------------------------------------------------
Correct response category:
  A.................................................   10    0    0    0
  B.................................................    5   10    0    0
  C.................................................    5    0   10    5
  D.................................................    0   -5    5   10
------------------------------------------------------------------------

    (D) Criteria for scoring system for a 10-slide test set. (See table 
at paragraph (b)(3)(ii)(A) of this section for a description of the 
response categories.) For cytotechnologists qualified under Sec. Sec.  
493.1469 or 493.1483:

[[Page 568]]



------------------------------------------------------------------------
                Examinee's response:                   A    B    C    D
------------------------------------------------------------------------
Correct response category:
  A.................................................   10    0    5    5
  B.................................................    5   10    5    5
  C.................................................    5    0   10   10
  D.................................................    0   -5   10   10
------------------------------------------------------------------------

    (E) In accordance with the criteria for the scoring system, the 
charts in paragraphs (b)(3)(ii)(F) and (G) of this section, for 
technical supervisors and cytotechnologists, respectively, provide 
maximums of 5 points for a correct response and minus ten (-10) points 
for an incorrect response on a 20-slide test set.
    (F) Criteria for scoring system for a 20-slide test set. (See table 
at paragraph (b)(3)(ii)(A) of this section for a description of the 
response categories.) For technical supervisors qualified under Sec.  
493.1449(b) or (k):

------------------------------------------------------------------------
             Examinee's response:                 A      B      C     D
------------------------------------------------------------------------
Correct response category:
  A...........................................   5         0   0     0
  B...........................................   2.5       5   0     0
  C...........................................   2.5       0   5     2.5
  D...........................................   0       -10   2.5   5
------------------------------------------------------------------------

    (G) Criteria for scoring system for a 20-slide test set. (See table 
at (b)(3)(ii)(A) of this section for a description of the response 
categories.) For cytotechnologists qualified under Sec. Sec.  493.1469 
or 493.1483:

------------------------------------------------------------------------
              Examinee's response:                 A     B      C     D
------------------------------------------------------------------------
Correct response category:
  A............................................   5        0   2.5   2.5
  B............................................   2.5      5   2.5   2.5
  C............................................   2.5      0   5     5
  D............................................   0      -10   5     5
------------------------------------------------------------------------


[57 FR 7151, Feb. 28, 1992, as amended at 58 FR 5229, Jan. 19, 1993; 68 
FR 3702, Jan. 24, 2003]



Sec.  493.959  Immunohematology.

    (a) Types of services offered by laboratories. In immunohematology, 
there are four types of laboratories for proficiency testing purposes--
    (1) Those that perform ABO group and/or D (Rho) typing;
    (2) Those that perform ABO group and/or D (Rho) typing, and 
unexpected antibody detection;
    (3) Those that in addition to paragraph (a)(2) of this section 
perform compatibility testing; and
    (4) Those that perform in addition to paragraph (a)(3) of this 
section antibody identification.
    (b) Program content and frequency of challenge. To be approved for 
proficiency testing for immunohematology, a program must provide a 
minimum of five samples per testing event. There must be at least three 
testing events at approximately equal intervals per year. The annual 
program must provide samples that cover the full range of interpretation 
that would be expected in patient specimens. The samples may be provided 
through mailed shipments or, at HHS' option, may be provided to HHS or 
its designee for on-site testing.
    (c) Challenges per testing event. The minimum number of challenges 
per testing event a program must provide for each analyte or test 
procedure is five.

                        Analyte or Test Procedure

ABO group (excluding subgroups)
D (Rho) typing
Unexpected antibody detection
Compatibility testing
Antibody identification

    (d) Evaluation of a laboratory's analyte or test performance. HHS 
approves only those programs that assess the accuracy of a laboratory's 
response in accordance with paragraphs (d)(1) through (5) of this 
section.
    (1) To determine the accuracy of a laboratory's response, a program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 100 percent of ten or more 
referee laboratories or 95 percent or more of all participating 
laboratories except for unexpected antibody detection and antibody 
identification. To determine the accuracy of a laboratory's response for 
unexpected antibody detection and antibody identification, a program 
must compare the laboratory's response for each analyte with the 
response that reflects agreement of either 95 percent of ten or more 
referee laboratories or 95 percent or more of all participating 
laboratories. The score for a sample in immunohematology is either the 
score determined under paragraph (d)(2) or (3) of this section.

[[Page 569]]

    (2) Criteria for acceptable performance. The criteria for acceptable 
performance are--

------------------------------------------------------------------------
                                               Criteria for acceptable
              Analyte or test                        performance
------------------------------------------------------------------------
ABO group.................................  100% accuracy.
D (Rho) typing............................  100% accuracy.
Unexpected antibody detection.............  80% accuracy.
Compatibility testing.....................  100% accuracy.
Antibody identification...................  80% accuracy.
------------------------------------------------------------------------

    (3) The criterion for acceptable performance for qualitative 
immunohematology tests is positive or negative.
    (4) To determine the analyte testing event score, the number of 
acceptable analyte responses must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.023

    (5) To determine the overall testing event score, the number of 
correct responses for all analytes must be averaged using the following 
formula: 
[GRAPHIC] [TIFF OMITTED] TR25SE06.022



         Subpart J_Facility Administration for Nonwaived Testing

    Source: 68 FR 3703, Jan. 24, 2003, unless otherwise noted.



Sec.  493.1100  Condition: Facility administration.

    Each laboratory that performs nonwaived testing must meet the 
applicable requirements under Sec. Sec.  493.1101 through 493.1105, 
unless HHS approves a procedure that provides equivalent quality testing 
as specified in Appendix C of the State Operations Manual (CMS Pub. 7).



Sec.  493.1101  Standard: Facilities.

    (a) The laboratory must be constructed, arranged, and maintained to 
ensure the following:
    (1) The space, ventilation, and utilities necessary for conducting 
all phases of the testing process.
    (2) Contamination of patient specimens, equipment, instruments, 
reagents, materials, and supplies is minimized.
    (3) Molecular amplification procedures that are not contained in 
closed systems have a uni-directional workflow. This must include 
separate areas for specimen preparation, amplification and product 
detection, and, as applicable, reagent preparation.
    (b) The laboratory must have appropriate and sufficient equipment, 
instruments, reagents, materials, and supplies for the type and volume 
of testing it performs.
    (c) The laboratory must be in compliance with applicable Federal, 
State, and local laboratory requirements.
    (d) Safety procedures must be established, accessible, and observed 
to ensure protection from physical, chemical, biochemical, and 
electrical hazards, and biohazardous materials.
    (e) Records and, as applicable, slides, blocks, and tissues must be 
maintained and stored under conditions that ensure proper preservation.



Sec.  493.1103  Standard: Requirements for transfusion services.

    A facility that provides transfusion services must meet all of the 
requirements of this section and document all transfusion-related 
activities.
    (a) Arrangement for services. The facility must have a transfusion 
service

[[Page 570]]

agreement reviewed and approved by the responsible party(ies) that 
govern the procurement, transfer, and availability of blood and blood 
products.
    (b) Provision of testing. The facility must provide prompt ABO 
grouping, D(Rho) typing, unexpected antibody detection, compatibility 
testing, and laboratory investigation of transfusion reactions on a 
continuous basis through a CLIA-certified laboratory or a laboratory 
meeting equivalent requirements as determined by CMS.
    (c) Blood and blood products storage and distribution. (1) If a 
facility stores or maintains blood or blood products for transfusion 
outside of a monitored refrigerator, the facility must ensure the 
storage conditions, including temperature, are appropriate to prevent 
deterioration of the blood or blood product.
    (2) The facility must establish and follow policies to ensure 
positive identification of a blood or blood product recipient.
    (d) Investigation of transfusion reactions. The facility must have 
procedures for preventing transfusion reactions and when necessary, 
promptly identify, investigate, and report blood and blood product 
transfusion reactions to the laboratory and, as appropriate, to Federal 
and State authorities.



Sec.  493.1105  Standard: Retention requirements.

    (a) The laboratory must retain its records and, as applicable, 
slides, blocks, and tissues as follows:
    (1) Test requisitions and authorizations. Retain records of test 
requisitions and test authorizations, including the patient's chart or 
medical record if used as the test requisition or authorization, for at 
least 2 years.
    (2) Test procedures. Retain a copy of each test procedure for at 
least 2 years after a procedure has been discontinued. Each test 
procedure must include the dates of initial use and discontinuance.
    (3) Analytic systems records. Retain quality control and patient 
test records (including instrument printouts, if applicable) and records 
documenting all analytic systems activities specified in Sec. Sec.  
493.1252 through 493.1289 for at least 2 years. In addition, retain the 
following:
    (i) Records of test system performance specifications that the 
laboratory establishes or verifies under Sec.  493.1253 for the period 
of time the laboratory uses the test system but no less than 2 years.
    (ii) Immunohematology records, blood and blood product records, and 
transfusion records as specified in 21 CFR 606.160(b)(3)(ii), 
(b)(3)(iv), (b)(3)(v) and (d).
    (4) Proficiency testing records. Retain all proficiency testing 
records for at least 2 years.
    (5) Quality system assessment records. Retain all laboratory quality 
systems assessment records for at least 2 years.
    (6) Test reports. Retain or be able to retrieve a copy of the 
original report (including final, preliminary, and corrected reports) at 
least 2 years after the date of reporting. In addition, retain the 
following:
    (i) Immunohematology reports as specified in 21 CFR 606.160(d).
    (ii) Pathology test reports for at least 10 years after the date of 
reporting.
    (7) Slide, block, and tissue retention--(i) Slides. (A) Retain 
cytology slide preparations for at least 5 years from the date of 
examination (see Sec.  493.1274(f) for proficiency testing exception).
    (B) Retain histopathology slides for at least 10 years from the date 
of examination.
    (ii) Blocks. Retain pathology specimen blocks for at least 2 years 
from the date of examination.
    (iii) Tissue. Preserve remnants of tissue for pathology examination 
until a diagnosis is made on the specimen.
    (b) If the laboratory ceases operation, the laboratory must make 
provisions to ensure that all records and, as applicable, slides, 
blocks, and tissue are retained and available for the time frames 
specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50723, Aug. 22, 2003]



             Subpart K_Quality System for Nonwaived Testing

    Source: 68 FR 3703, Jan. 24, 2003, unless otherwise noted.

[[Page 571]]



Sec.  493.1200  Introduction.

    (a) Each laboratory that performs nonwaived testing must establish 
and maintain written policies and procedures that implement and monitor 
a quality system for all phases of the total testing process (that is, 
preanalytic, analytic, and postanalytic) as well as general laboratory 
systems.
    (b) The laboratory's quality systems must include a quality 
assessment component that ensures continuous improvement of the 
laboratory's performance and services through ongoing monitoring that 
identifies, evaluates and resolves problems.
    (c) The various components of the laboratory's quality system are 
used to meet the requirements in this part and must be appropriate for 
the specialties and subspecialties of testing the laboratory performs, 
services it offers, and clients it serves.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1201  Condition: Bacteriology.

    If the laboratory provides services in the subspecialty of 
Bacteriology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1261, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1202  Condition: Mycobacteriology.

    If the laboratory provides services in the subspecialty of 
Mycobacteriology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1262, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1203  Condition: Mycology.

    If the laboratory provides services in the subspecialty of Mycology, 
the laboratory must meet the requirements specified in Sec. Sec.  
493.1230 through 493.1256, Sec.  493.1263, and Sec. Sec.  493.1281 
through 493.1299.



Sec.  493.1204  Condition: Parasitology.

    If the laboratory provides services in the subspecialty of 
Parasitology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1264, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1205  Condition: Virology.

    If the laboratory provides services in the subspecialty of Virology, 
the laboratory must meet the requirements specified in Sec. Sec.  
493.1230 through 493.1256, Sec.  493.1265, and Sec. Sec.  493.1281 
through 493.1299.



Sec.  493.1207  Condition: Syphilis serology.

    If the laboratory provides services in the subspecialty of Syphilis 
serology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.



Sec.  493.1208  Condition: General immunology.

    If the laboratory provides services in the subspecialty of General 
immunology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1210  Condition: Routine chemistry.

    If the laboratory provides services in the subspecialty of Routine 
chemistry, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1267, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1211  Condition: Urinalysis.

    If the laboratory provides services in the subspecialty of 
Urinalysis, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.



Sec.  493.1212  Condition: Endocrinology.

    If the laboratory provides services in the subspecialty of 
Endocrinology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.



Sec.  493.1213  Condition: Toxicology.

    If the laboratory provides services in the subspecialty of 
Toxicology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.

[[Page 572]]



Sec.  493.1215  Condition: Hematology.

    If the laboratory provides services in the specialty of Hematology, 
the laboratory must meet the requirements specified in Sec. Sec.  
493.1230 through 493.1256, Sec.  493.1269, and Sec. Sec.  493.1281 
through 493.1299.



Sec.  493.1217  Condition: Immunohematology.

    If the laboratory provides services in the specialty of 
Immunohematology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1271, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1219  Condition: Histopathology.

    If the laboratory provides services in the subspecialty of 
Histopathology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1273, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1220  Condition: Oral pathology.

    If the laboratory provides services in the subspecialty of Oral 
pathology, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.



Sec.  493.1221  Condition: Cytology.

    If the laboratory provides services in the subspecialty of Cytology, 
the laboratory must meet the requirements specified in Sec. Sec.  
493.1230 through 493.1256, Sec.  493.1274, and Sec. Sec.  493.1281 
through 493.1299.



Sec.  493.1225  Condition: Clinical cytogenetics.

    If the laboratory provides services in the specialty of Clinical 
cytogenetics, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, Sec.  493.1276, and Sec. Sec.  
493.1281 through 493.1299.



Sec.  493.1226  Condition: Radiobioassay.

    If the laboratory provides services in the specialty of 
Radiobioassay, the laboratory must meet the requirements specified in 
Sec. Sec.  493.1230 through 493.1256, and Sec. Sec.  493.1281 through 
493.1299.



Sec.  493.1227  Condition: Histocompatibility.

    If the laboratory provides services in the specialty of 
Histocompatibility, the laboratory must meet the requirements specified 
in Sec. Sec.  493.1230 through 493.1256, Sec.  493.1278, and Sec. Sec.  
493.1281 through 493.1299.

                       General Laboratory Systems



Sec.  493.1230  Condition: General laboratory systems.

    Each laboratory that performs nonwaived testing must meet the 
applicable general laboratory systems requirements in Sec. Sec.  
493.1231 through 493.1236, unless HHS approves a procedure, specified in 
Appendix C of the State Operations Manual (CMS Pub. 7), that provides 
equivalent quality testing. The laboratory must monitor and evaluate the 
overall quality of the general laboratory systems and correct identified 
problems as specified in Sec.  493.1239 for each specialty and 
subspecialty of testing performed.



Sec.  493.1231  Standard: Confidentiality of patient information.

    The laboratory must ensure confidentiality of patient information 
throughout all phases of the total testing process that are under the 
laboratory's control.



Sec.  493.1232  Standard: Specimen identification and integrity.

    The laboratory must establish and follow written policies and 
procedures that ensure positive identification and optimum integrity of 
a patient's specimen from the time of collection or receipt of the 
specimen through completion of testing and reporting of results.



Sec.  493.1233  Standard: Complaint investigations.

    The laboratory must have a system in place to ensure that it 
documents all complaints and problems reported to the laboratory. The 
laboratory must conduct investigations of complaints, when appropriate.

[[Page 573]]



Sec.  493.1234  Standard: Communications.

    The laboratory must have a system in place to identify and document 
problems that occur as a result of a breakdown in communication between 
the laboratory and an authorized person who orders or receives test 
results.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1235  Standard: Personnel competency assessment policies.

    As specified in the personnel requirements in subpart M, the 
laboratory must establish and follow written policies and procedures to 
assess employee and, if applicable, consultant competency.



Sec.  493.1236  Standard: Evaluation of proficiency testing performance.

    (a) The laboratory must review and evaluate the results obtained on 
proficiency testing performed as specified in subpart H of this part.
    (b) The laboratory must verify the accuracy of the following:
    (1) Any analyte or subspecialty without analytes listed in subpart I 
of this part that is not evaluated or scored by a CMS-approved 
proficiency testing program.
    (2) Any analyte, specialty or subspecialty assigned a proficiency 
testing score that does not reflect laboratory test performance (that 
is, when the proficiency testing program does not obtain the agreement 
required for scoring as specified in subpart I of this part, or the 
laboratory receives a zero score for nonparticipation, or late return of 
results).
    (c) At least twice annually, the laboratory must verify the accuracy 
of the following:
    (1) Any test or procedure it performs that is not included in 
subpart I of this part.
    (2) Any test or procedure listed in subpart I of this part for which 
compatible proficiency testing samples are not offered by a CMS-approved 
proficiency testing program.
    (d) All proficiency testing evaluation and verification activities 
must be documented.



Sec.  493.1239  Standard: General laboratory systems quality assessment.

    (a) The laboratory must establish and follow written policies and 
procedures for an ongoing mechanism to monitor, assess, and, when 
indicated, correct problems identified in the general laboratory systems 
requirements specified at Sec. Sec.  493.1231 through 493.1236.
    (b) The general laboratory systems quality assessment must include a 
review of the effectiveness of corrective actions taken to resolve 
problems, revision of policies and procedures necessary to prevent 
recurrence of problems, and discussion of general laboratory systems 
quality assessment reviews with appropriate staff.
    (c) The laboratory must document all general laboratory systems 
quality assessment activities.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]

                           Preanalytic Systems



Sec.  493.1240  Condition: Preanalytic systems.

    Each laboratory that performs nonwaived testing must meet the 
applicable preanalytic system(s) requirements in Sec. Sec.  493.1241 and 
493.1242, unless HHS approves a procedure, specified in Appendix C of 
the State Operations Manual (CMS Pub. 7), that provides equivalent 
quality testing. The laboratory must monitor and evaluate the overall 
quality of the preanalytic systems and correct identified problems as 
specified in Sec.  493.1249 for each specialty and subspecialty of 
testing performed.



Sec.  493.1241  Standard: Test request.

    (a) The laboratory must have a written or electronic request for 
patient testing from an authorized person.
    (b) The laboratory may accept oral requests for laboratory tests if 
it solicits a written or electronic authorization within 30 days of the 
oral request and maintains the authorization or documentation of its 
efforts to obtain the authorization.
    (c) The laboratory must ensure the test requisition solicits the 
following information:
    (1) The name and address or other suitable identifiers of the 
authorized

[[Page 574]]

person requesting the test and, if appropriate, the individual 
responsible for using the test results, or the name and address of the 
laboratory submitting the specimen, including, as applicable, a contact 
person to enable the reporting of imminently life threatening laboratory 
results or panic or alert values.
    (2) The patient's name or unique patient identifier.
    (3) The sex and age or date of birth of the patient.
    (4) The test(s) to be performed.
    (5) The source of the specimen, when appropriate.
    (6) The date and, if appropriate, time of specimen collection.
    (7) For Pap smears, the patient's last menstrual period, and 
indication of whether the patient had a previous abnormal report, 
treatment, or biopsy.
    (8) Any additional information relevant and necessary for a specific 
test to ensure accurate and timely testing and reporting of results, 
including interpretation, if applicable.
    (d) The patient's chart or medical record may be used as the test 
requisition or authorization but must be available to the laboratory at 
the time of testing and available to CMS or a CMS agent upon request.
    (e) If the laboratory transcribes or enters test requisition or 
authorization information into a record system or a laboratory 
information system, the laboratory must ensure the information is 
transcribed or entered accurately.



Sec.  493.1242  Standard: Specimen submission, handling, and referral.

    (a) The laboratory must establish and follow written policies and 
procedures for each of the following, if applicable:
    (1) Patient preparation.
    (2) Specimen collection.
    (3) Specimen labeling, including patient name or unique patient 
identifier and, when appropriate, specimen source.
    (4) Specimen storage and preservation.
    (5) Conditions for specimen transportation.
    (6) Specimen processing.
    (7) Specimen acceptability and rejection.
    (8) Specimen referral.
    (b) The laboratory must document the date and time it receives a 
specimen.
    (c) The laboratory must refer a specimen for testing only to a CLIA-
certified laboratory or a laboratory meeting equivalent requirements as 
determined by CMS.
    (d) If the laboratory accepts a referral specimen, written 
instructions must be available to the laboratory's clients and must 
include, as appropriate, the information specified in paragraphs (a)(1) 
through (a)(7) of this section.



Sec.  493.1249  Standard: Preanalytic systems quality assessment.

    (a) The laboratory must establish and follow written policies and 
procedures for an ongoing mechanism to monitor, assess, and when 
indicated, correct problems identified in the preanalytic systems 
specified at Sec. Sec.  493.1241 through 493.1242.
    (b) The preanalytic systems quality assessment must include a review 
of the effectiveness of corrective actions taken to resolve problems, 
revision of policies and procedures necessary to prevent recurrence of 
problems, and discussion of preanalytic systems quality assessment 
reviews with appropriate staff.
    (c) The laboratory must document all preanalytic systems quality 
assessment activities.

[68 FR 3703, Jan. 24, 2003; 68 FR 3703, Aug. 22, 2003]

                            Analytic Systems



Sec.  493.1250  Condition: Analytic systems.

    Each laboratory that performs nonwaived testing must meet the 
applicable analytic systems requirements in Sec. Sec.  493.1251 through 
493.1283, unless HHS approves a procedure, specified in Appendix C of 
the State Operations Manual (CMS Pub. 7), that provides equivalent 
quality testing. The laboratory must monitor and evaluate the overall 
quality of the analytic systems and correct identified problems as 
specified in Sec.  493.1289 for each specialty and subspecialty of 
testing performed.

[[Page 575]]



Sec.  493.1251  Standard: Procedure manual.

    (a) A written procedure manual for all tests, assays, and 
examinations performed by the laboratory must be available to, and 
followed by, laboratory personnel. Textbooks may supplement but not 
replace the laboratory's written procedures for testing or examining 
specimens.
    (b) The procedure manual must include the following when applicable 
to the test procedure:
    (1) Requirements for patient preparation; specimen collection, 
labeling, storage, preservation, transportation, processing, and 
referral; and criteria for specimen acceptability and rejection as 
described in Sec.  493.1242.
    (2) Microscopic examination, including the detection of inadequately 
prepared slides.
    (3) Step-by-step performance of the procedure, including test 
calculations and interpretation of results.
    (4) Preparation of slides, solutions, calibrators, controls, 
reagents, stains, and other materials used in testing.
    (5) Calibration and calibration verification procedures.
    (6) The reportable range for test results for the test system as 
established or verified in Sec.  493.1253.
    (7) Control procedures.
    (8) Corrective action to take when calibration or control results 
fail to meet the laboratory's criteria for acceptability.
    (9) Limitations in the test methodology, including interfering 
substances.
    (10) Reference intervals (normal values).
    (11) Imminently life-threatening test results, or panic or alert 
values.
    (12) Pertinent literature references.
    (13) The laboratory's system for entering results in the patient 
record and reporting patient results including, when appropriate, the 
protocol for reporting imminently life-threatening results, or panic, or 
alert values.
    (14) Description of the course of action to take if a test system 
becomes inoperable.
    (c) Manufacturer's test system instructions or operator manuals may 
be used, when applicable, to meet the requirements of paragraphs (b)(1) 
through (b)(12) of this section. Any of the items under paragraphs 
(b)(1) through (b)(12) of this section not provided by the manufacturer 
must be provided by the laboratory.
    (d) Procedures and changes in procedures must be approved, signed, 
and dated by the current laboratory director before use.
    (e) The laboratory must maintain a copy of each procedure with the 
dates of initial use and discontinuance as described in Sec.  
493.1105(a)(2).

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1252  Standard: Test systems, equipment, instruments, reagents, materials, and supplies.

    (a) Test systems must be selected by the laboratory. The testing 
must be performed following the manufacturer's instructions and in a 
manner that provides test results within the laboratory's stated 
performance specifications for each test system as determined under 
Sec.  493.1253.
    (b) The laboratory must define criteria for those conditions that 
are essential for proper storage of reagents and specimens, accurate and 
reliable test system operation, and test result reporting. The criteria 
must be consistent with the manufacturer's instructions, if provided. 
These conditions must be monitored and documented and, if applicable, 
include the following:
    (1) Water quality.
    (2) Temperature.
    (3) Humidity.
    (4) Protection of equipment and instruments from fluctuations and 
interruptions in electrical current that adversely affect patient test 
results and test reports.
    (c) Reagents, solutions, culture media, control materials, 
calibration materials, and other supplies, as appropriate, must be 
labeled to indicate the following:
    (1) Identity and when significant, titer, strength or concentration.
    (2) Storage requirements.
    (3) Preparation and expiration dates.
    (4) Other pertinent information required for proper use.
    (d) Reagents, solutions, culture media, control materials, 
calibration materials, and other supplies must not

[[Page 576]]

be used when they have exceeded their expiration date, have 
deteriorated, or are of substandard quality.
    (e) Components of reagent kits of different lot numbers must not be 
interchanged unless otherwise specified by the manufacturer.



Sec.  493.1253  Standard: Establishment and verification of performance specifications.

    (a) Applicability. Laboratories are not required to verify or 
establish performance specifications for any test system used by the 
laboratory before April 24, 2003.
    (b)(1) Verification of performance specifications. Each laboratory 
that introduces an unmodified, FDA-cleared or approved test system must 
do the following before reporting patient test results:
    (i) Demonstrate that it can obtain performance specifications 
comparable to those established by the manufacturer for the following 
performance characteristics:
    (A) Accuracy.
    (B) Precision.
    (C) Reportable range of test results for the test system.
    (ii) Verify that the manufacturer's reference intervals (normal 
values) are appropriate for the laboratory's patient population.
    (2) Establishment of performance specifications. Each laboratory 
that modifies an FDA-cleared or approved test system, or introduces a 
test system not subject to FDA clearance or approval (including methods 
developed in-house and standardized methods such as text book 
procedures), or uses a test system in which performance specifications 
are not provided by the manufacturer must, before reporting patient test 
results, establish for each test system the performance specifications 
for the following performance characteristics, as applicable:
    (i) Accuracy.
    (ii) Precision.
    (iii) Analytical sensitivity.
    (iv) Analytical specificity to include interfering substances.
    (v) Reportable range of test results for the test system.
    (vi) Reference intervals (normal values).
    (vii) Any other performance characteristic required for test 
performance.
    (3) Determination of calibration and control procedures. The 
laboratory must determine the test system's calibration procedures and 
control procedures based upon the performance specifications verified or 
established under paragraph (b)(1) or (b)(2) of this section.
    (c) Documentation. The laboratory must document all activities 
specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1254  Standard: Maintenance and function checks.

    (a) Unmodified manufacturer's equipment, instruments, or test 
systems. The laboratory must perform and document the following:
    (1) Maintenance as defined by the manufacturer and with at least the 
frequency specified by the manufacturer.
    (2) Function checks as defined by the manufacturer and with at least 
the frequency specified by the manufacturer. Function checks must be 
within the manufacturer's established limits before patient testing is 
conducted.
    (b) Equipment, instruments, or test systems developed in-house, 
commercially available and modified by the laboratory, or maintenance 
and function check protocols are not provided by the manufacturer. The 
laboratory must do the following:
    (1)(i) Establish a maintenance protocol that ensures equipment, 
instrument, and test system performance that is necessary for accurate 
and reliable test results and test result reporting.
    (ii) Perform and document the maintenance activities specified in 
paragraph (b)(1)(i) of this section.
    (2)(i) Define a function check protocol that ensures equipment, 
instrument, and test system performance that is necessary for accurate 
and reliable test results and test result reporting.
    (ii) Perform and document the function checks, including background 
or baseline checks, specified in paragraph (b)(2)(i) of this section. 
Function checks must be within the laboratory's

[[Page 577]]

established limits before patient testing is conducted.



Sec.  493.1255  Standard: Calibration and calibration verification procedures.

    Calibration and calibration verification procedures are required to 
substantiate the continued accuracy of the test system throughout the 
laboratory's reportable range of test results for the test system. 
Unless otherwise specified in this subpart, for each applicable test 
system the laboratory must do the following:
    (a) Perform and document calibration procedures--
    (1) Following the manufacturer's test system instructions, using 
calibration materials provided or specified, and with at least the 
frequency recommended by the manufacturer;
    (2) Using the criteria verified or established by the laboratory as 
specified in Sec.  493.1253(b)(3)--
    (i) Using calibration materials appropriate for the test system and, 
if possible, traceable to a reference method or reference material of 
known value; and
    (ii) Including the number, type, and concentration of calibration 
materials, as well as acceptable limits for and the frequency of 
calibration; and
    (3) Whenever calibration verification fails to meet the laboratory's 
acceptable limits for calibration verification.
    (b) Perform and document calibration verification procedures--
    (1) Following the manufacturer's calibration verification 
instructions;
    (2) Using the criteria verified or established by the laboratory 
under Sec.  493.1253(b)(3)--
    (i) Including the number, type, and concentration of the materials, 
as well as acceptable limits for calibration verification; and
    (ii) Including at least a minimal (or zero) value, a mid-point 
value, and a maximum value near the upper limit of the range to verify 
the laboratory's reportable range of test results for the test system; 
and
    (3) At least once every 6 months and whenever any of the following 
occur:
    (i) A complete change of reagents for a procedure is introduced, 
unless the laboratory can demonstrate that changing reagent lot numbers 
does not affect the range used to report patient test results, and 
control values are not adversely affected by reagent lot number changes.
    (ii) There is major preventive maintenance or replacement of 
critical parts that may influence test performance.
    (iii) Control materials reflect an unusual trend or shift, or are 
outside of the laboratory's acceptable limits, and other means of 
assessing and correcting unacceptable control values fail to identify 
and correct the problem.
    (iv) The laboratory's established schedule for verifying the 
reportable range for patient test results requires more frequent 
calibration verification.



Sec.  493.1256  Standard: Control procedures.

    (a) For each test system, the laboratory is responsible for having 
control procedures that monitor the accuracy and precision of the 
complete analytic process.
    (b) The laboratory must establish the number, type, and frequency of 
testing control materials using, if applicable, the performance 
specifications verified or established by the laboratory as specified in 
Sec.  493.1253(b)(3).
    (c) The control procedures must--
    (1) Detect immediate errors that occur due to test system failure, 
adverse environmental conditions, and operator performance.
    (2) Monitor over time the accuracy and precision of test performance 
that may be influenced by changes in test system performance and 
environmental conditions, and variance in operator performance.
    (d) Unless CMS approves a procedure, specified in Appendix C of the 
State Operations Manual (CMS Pub. 7), that provides equivalent quality 
testing, the laboratory must--
    (1) Perform control procedures as defined in this section unless 
otherwise specified in the additional specialty and subspecialty 
requirements at Sec. Sec.  493.1261 through 493.1278.
    (2) For each test system, perform control procedures using the 
number

[[Page 578]]

and frequency specified by the manufacturer or established by the 
laboratory when they meet or exceed the requirements in paragraph (d)(3) 
of this section.
    (3) At least once each day patient specimens are assayed or examined 
perform the following for--
    (i) Each quantitative procedure, include two control materials of 
different concentrations;
    (ii) Each qualitative procedure, include a negative and positive 
control material;
    (iii) Test procedures producing graded or titered results, include a 
negative control material and a control material with graded or titered 
reactivity, respectively;
    (iv) Each test system that has an extraction phase, include two 
control materials, including one that is capable of detecting errors in 
the extraction process; and
    (v) Each molecular amplification procedure, include two control 
materials and, if reaction inhibition is a significant source of false 
negative results, a control material capable of detecting the 
inhibition.
    (4) For thin layer chromatography--
    (i) Spot each plate or card, as applicable, with a calibrator 
containing all known substances or drug groups, as appropriate, which 
are identified by thin layer chromatography and reported by the 
laboratory; and
    (ii) Include at least one control material on each plate or card, as 
applicable, which must be processed through each step of patient 
testing, including extraction processes.
    (5) For each electrophoretic procedure include, concurrent with 
patient specimens, at least one control material containing the 
substances being identified or measured.
    (6) Perform control material testing as specified in this paragraph 
before resuming patient testing when a complete change of reagents is 
introduced; major preventive maintenance is performed; or any critical 
part that may influence test performance is replaced.
    (7) Over time, rotate control material testing among all operators 
who perform the test.
    (8) Test control materials in the same manner as patient specimens.
    (9) When using calibration material as a control material, use 
calibration material from a different lot number than that used to 
establish a cut-off value or to calibrate the test system.
    (10) Establish or verify the criteria for acceptability of all 
control materials.
    (i) When control materials providing quantitative results are used, 
statistical parameters (for example, mean and standard deviation) for 
each batch and lot number of control materials must be defined and 
available.
    (ii) The laboratory may use the stated value of a commercially 
assayed control material provided the stated value is for the 
methodology and instrumentation employed by the laboratory and is 
verified by the laboratory.
    (iii) Statistical parameters for unassayed control materials must be 
established over time by the laboratory through concurrent testing of 
control materials having previously determined statistical parameters.
    (e) For reagent, media, and supply checks, the laboratory must do 
the following:
    (1) Check each batch (prepared in-house), lot number (commercially 
prepared) and shipment of reagents, disks, stains, antisera, (except 
those specifically referenced in Sec.  493.1261(a)(3)) and 
identification systems (systems using two or more substrates or two or 
more reagents, or a combination) when prepared or opened for positive 
and negative reactivity, as well as graded reactivity, if applicable.
    (2) Each day of use (unless otherwise specified in this subpart), 
test staining materials for intended reactivity to ensure predictable 
staining characteristics. Control materials for both positive and 
negative reactivity must be included, as appropriate.
    (3) Check fluorescent and immunohistochemical stains for positive 
and negative reactivity each time of use.
    (4) Before, or concurrent with the initial use--
    (i) Check each batch of media for sterility if sterility is required 
for testing;

[[Page 579]]

    (ii) Check each batch of media for its ability to support growth 
and, as appropriate, select or inhibit specific organisms or produce a 
biochemical response; and
    (iii) Document the physical characteristics of the media when 
compromised and report any deterioration in the media to the 
manufacturer.
    (5) Follow the manufacturer's specifications for using reagents, 
media, and supplies and be responsible for results.
    (f) Results of control materials must meet the laboratory's and, as 
applicable, the manufacturer's test system criteria for acceptability 
before reporting patient test results.
    (g) The laboratory must document all control procedures performed.
    (h) If control materials are not available, the laboratory must have 
an alternative mechanism to detect immediate errors and monitor test 
system performance over time. The performance of alternative control 
procedures must be documented.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1261  Standard: Bacteriology.

    (a) The laboratory must check the following for positive and 
negative reactivity using control organisms:
    (1) Each day of use for beta-lactamase methods other than 
Cefinase\TM\.
    (2) Each week of use for Gram stains.
    (3) When each batch (prepared in-house), lot number (commercially 
prepared), and shipment of antisera is prepared or opened, and once 
every 6 months thereafter.
    (b) For antimicrobial susceptibility tests, the laboratory must 
check each batch of media and each lot number and shipment of 
antimicrobial agent(s) before, or concurrent with, initial use, using 
approved control organisms.
    (1) Each day tests are performed, the laboratory must use the 
appropriate control organism(s) to check the procedure.
    (2) The laboratory's zone sizes or minimum inhibitory concentration 
for control organisms must be within established limits before reporting 
patient results.
    (c) The laboratory must document all control procedures performed, 
as specified in this section.



Sec.  493.1262  Standard: Mycobacteriology.

    (a) Each day of use, the laboratory must check all reagents or test 
procedures used for mycobacteria identification with at least one acid-
fast organism that produces a positive reaction and an acid-fast 
organism that produces a negative reaction.
    (b) For antimycobacterial susceptibility tests, the laboratory must 
check each batch of media and each lot number and shipment of 
antimycobacterial agent(s) before, or concurrent with, initial use, 
using an appropriate control organism(s).
    (1) The laboratory must establish limits for acceptable control 
results.
    (2) Each week tests are performed, the laboratory must use the 
appropriate control organism(s) to check the procedure.
    (3) The results for the control organism(s) must be within 
established limits before reporting patient results.
    (c) The laboratory must document all control procedures performed, 
as specified in this section.



Sec.  493.1263  Standard: Mycology.

    (a) The laboratory must check each batch (prepared in-house), lot 
number (commercially prepared), and shipment of lactophenol cotton blue 
when prepared or opened for intended reactivity with a control 
organism(s).
    (b) For antifungal susceptibility tests, the laboratory must check 
each batch of media and each lot number and shipment of antifungal 
agent(s) before, or concurrent with, initial use, using an appropriate 
control organism(s).
    (1) The laboratory must establish limits for acceptable control 
results.
    (2) Each day tests are performed, the laboratory must use the 
appropriate control organism(s) to check the procedure.
    (3) The results for the control organism(s) must be within 
established limits before reporting patient results.
    (c) The laboratory must document all control procedures performed, 
as specified in this section.

[[Page 580]]



Sec.  493.1264  Standard: Parasitology.

    (a) The laboratory must have available a reference collection of 
slides or photographs and, if available, gross specimens for 
identification of parasites and use these references in the laboratory 
for appropriate comparison with diagnostic specimens.
    (b) The laboratory must calibrate and use the calibrated ocular 
micrometer for determining the size of ova and parasites, if size is a 
critical parameter.
    (c) Each month of use, the laboratory must check permanent stains 
using a fecal sample control material that will demonstrate staining 
characteristics.
    (d) The laboratory must document all control procedures performed, 
as specified in this section.



Sec.  493.1265  Standard: Virology.

    (a) When using cell culture to isolate or identify viruses, the 
laboratory must simultaneously incubate a cell substrate control or 
uninoculated cells as a negative control material.
    (b) The laboratory must document all control procedures performed, 
as specified in this section.



Sec.  493.1267  Standard: Routine chemistry.

    For blood gas analyses, the laboratory must perform the following:
    (a) Calibrate or verify calibration according to the manufacturer's 
specifications and with at least the frequency recommended by the 
manufacturer.
    (b) Test one sample of control material each 8 hours of testing 
using a combination of control materials that include both low and high 
values on each day of testing.
    (c) Test one sample of control material each time specimens are 
tested unless automated instrumentation internally verifies calibration 
at least every 30 minutes.
    (d) Document all control procedures performed, as specified in this 
section.



Sec.  493.1269  Standard: Hematology.

    (a) For manual cell counts performed using a hemocytometer--
    (1) One control material must be tested each 8 hours of operation; 
and
    (2) Patient specimens and control materials must be tested in 
duplicate.
    (b) For all nonmanual coagulation test systems, the laboratory must 
include two levels of control material each 8 hours of operation and 
each time a reagent is changed.
    (c) For manual coagulation tests--
    (1) Each individual performing tests must test two levels of control 
materials before testing patient samples and each time a reagent is 
changed; and
    (2) Patient specimens and control materials must be tested in 
duplicate.
    (d) The laboratory must document all control procedures performed, 
as specified in this section.



Sec.  493.1271  Standard: Immunohematology.

    (a) Patient testing. (1) The laboratory must perform ABO grouping, 
D(Rho) typing, unexpected antibody detection, antibody identification, 
and compatibility testing by following the manufacturer's instructions, 
if provided, and as applicable, 21 CFR 606.151(a) through (e).
    (2) The laboratory must determine ABO group by concurrently testing 
unknown red cells with, at a minimum, anti-A and anti-B grouping 
reagents. For confirmation of ABO group, the unknown serum must be 
tested with known A1 and B red cells.
    (3) The laboratory must determine the D(Rho) type by testing unknown 
red cells with anti-D (anti-Rho) blood typing reagent.
    (b) Immunohematological testing and distribution of blood and blood 
products. Blood and blood product testing and distribution must comply 
with 21 CFR 606.100(b)(12); 606.160(b)(3)(ii) and (b)(3)(v); 610.40; 
640.5(a), (b), (c), and (e); and 640.11(b).
    (c) Blood and blood products storage. Blood and blood products must 
be stored under appropriate conditions that include an adequate 
temperature alarm system that is regularly inspected.
    (1) An audible alarm system must monitor proper blood and blood 
product storage temperature over a 24-hour period.
    (2) Inspections of the alarm system must be documented.

[[Page 581]]

    (d) Retention of samples of transfused blood. According to the 
laboratory's established procedures, samples of each unit of transfused 
blood must be retained for further testing in the event of transfusion 
reactions. The laboratory must promptly dispose of blood not retained 
for further testing that has passed its expiration date.
    (e) Investigation of transfusion reactions. (1) According to its 
established procedures, the laboratory that performs compatibility 
testing, or issues blood or blood products, must promptly investigate 
all transfusion reactions occurring in facilities for which it has 
investigational responsibility and make recommendations to the medical 
staff regarding improvements in transfusion procedures.
    (2) The laboratory must document, as applicable, that all necessary 
remedial actions are taken to prevent recurrences of transfusion 
reactions and that all policies and procedures are reviewed to assure 
they are adequate to ensure the safety of individuals being transfused.
    (f) Documentation. The laboratory must document all control 
procedures performed, as specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1273  Standard: Histopathology.

    (a) As specified in Sec.  493.1256(e)(3), fluorescent and 
immunohistochemical stains must be checked for positive and negative 
reactivity each time of use. For all other differential or special 
stains, a control slide of known reactivity must be stained with each 
patient slide or group of patient slides. Reaction(s) of the control 
slide with each special stain must be documented.
    (b) The laboratory must retain stained slides, specimen blocks, and 
tissue remnants as specified in Sec.  493.1105. The remnants of tissue 
specimens must be maintained in a manner that ensures proper 
preservation of the tissue specimens until the portions submitted for 
microscopic examination have been examined and a diagnosis made by an 
individual qualified under Sec. Sec.  493.1449(b), (l), or (m).
    (c) An individual who has successfully completed a training program 
in neuromuscular pathology approved by HHS may examine and provide 
reports for neuromuscular pathology.
    (d) Tissue pathology reports must be signed by an individual 
qualified as specified in paragraph (b) or, as appropriate, paragraph 
(c) of this section. If a computer report is generated with an 
electronic signature, it must be authorized by the individual who 
performed the examination and made the diagnosis.
    (e) The laboratory must use acceptable terminology of a recognized 
system of disease nomenclature in reporting results.
    (f) The laboratory must document all control procedures performed, 
as specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1274  Standard: Cytology.

    (a) Cytology slide examination site. All cytology slide preparations 
must be evaluated on the premises of a laboratory certified to conduct 
testing in the subspecialty of cytology.
    (b) Staining. The laboratory must have available and follow written 
policies and procedures for each of the following, if applicable:
    (1) All gynecologic slide preparations must be stained using a 
Papanicolaou or modified Papanicolaou staining method.
    (2) Effective measures to prevent cross-contamination between 
gynecologic and nongynecologic specimens during the staining process 
must be used.
    (3) Nongynecologic specimens that have a high potential for cross-
contamination must be stained separately from other nongynecologic 
specimens, and the stains must be filtered or changed following 
staining.
    (c) Control procedures. The laboratory must establish and follow 
written policies and procedures for a program designed to detect errors 
in the performance of cytologic examinations and the reporting of 
results. The program must include the following:
    (1) A review of slides from at least 10 percent of the gynecologic 
cases interpreted by individuals qualified under Sec. Sec.  493.1469 or 
493.1483, to be negative for epithelial cell abnormalities and other

[[Page 582]]

malignant neoplasms (as defined in paragraph (e)(1) of this section).
    (i) The review must be performed by an individual who meets one of 
the following qualifications:
    (A) A technical supervisor qualified under Sec. Sec.  493.1449(b) or 
(k).
    (B) A cytology general supervisor qualified under Sec.  493.1469.
    (C) A cytotechnologist qualified under Sec.  493.1483 who has the 
experience specified in Sec.  493.1469(b)(2).
    (ii) Cases must be randomly selected from the total caseload and 
include negatives and those from patients or groups of patients that are 
identified as having a higher than average probability of developing 
cervical cancer based on available patient information.
    (iii) The review of those cases selected must be completed before 
reporting patient results.
    (2) Laboratory comparison of clinical information, when available, 
with cytology reports and comparison of all gynecologic cytology reports 
with a diagnosis of high-grade squamous intraepithelial lesion (HSIL), 
adenocarcinoma, or other malignant neoplasms with the histopathology 
report, if available in the laboratory (either on-site or in storage), 
and determination of the causes of any discrepancies.
    (3) For each patient with a current HSIL, adenocarcinoma, or other 
malignant neoplasm, laboratory review of all normal or negative 
gynecologic specimens received within the previous 5 years, if available 
in the laboratory (either on-site or in storage). If significant 
discrepancies are found that will affect current patient care, the 
laboratory must notify the patient's physician and issue an amended 
report.
    (4) Records of initial examinations and all rescreening results must 
be documented.
    (5) An annual statistical laboratory evaluation of the number of--
    (i) Cytology cases examined;
    (ii) Specimens processed by specimen type;
    (iii) Patient cases reported by diagnosis (including the number 
reported as unsatisfactory for diagnostic interpretation);
    (iv) Gynecologic cases with a diagnosis of HSIL, adenocarcinoma, or 
other malignant neoplasm for which histology results were available for 
comparison;
    (v) Gynecologic cases where cytology and histology are discrepant; 
and
    (vi) Gynecologic cases where any rescreen of a normal or negative 
specimen results in reclassification as low-grade squamous 
intraepithelial lesion (LSIL), HSIL, adenocarcinoma, or other malignant 
neoplasms.
    (6) An evaluation of the case reviews of each individual examining 
slides against the laboratory's overall statistical values, 
documentation of any discrepancies, including reasons for the deviation 
and, if appropriate, corrective actions taken.
    (d) Workload limits. The laboratory must establish and follow 
written policies and procedures that ensure the following:
    (1) The technical supervisor establishes a maximum workload limit 
for each individual who performs primary screening.
    (i) The workload limit is based on the individual's performance 
using evaluations of the following:
    (A) Review of 10 percent of the cases interpreted as negative for 
the conditions defined in paragraph (e)(1) of this section.
    (B) Comparison of the individual's interpretation with the technical 
supervisor's confirmation of patient smears specified in paragraphs 
(e)(1) and (e)(3) of this section.
    (ii) Each individual's workload limit is reassessed at least every 6 
months and adjusted when necessary.
    (2) The maximum number of slides examined by an individual in each 
24-hour period does not exceed 100 slides (one patient specimen per 
slide; gynecologic, nongynecologic, or both) irrespective of the site or 
laboratory. This limit represents an absolute maximum number of slides 
and must not be employed as an individual's performance target. In 
addition--
    (i) The maximum number of 100 slides is examined in no less than an 
8-hour workday;
    (ii) For the purposes of establishing workload limits for 
individuals examining slides in less than an 8-hour workday (includes 
full-time employees with duties other than slide examination and part-
time employees), a period

[[Page 583]]

of 8 hours is used to prorate the number of slides that may be examined. 
The formula--
[GRAPHIC] [TIFF OMITTED] TR24JA03.000


is used to determine maximum slide volume to be examined;
    (iii) Nongynecologic slide preparations made using liquid-based 
slide preparatory techniques that result in cell dispersion over one-
half or less of the total available slide may be counted as one-half 
slide; and
    (iv) Technical supervisors who perform primary screening are not 
required to include tissue pathology slides and previously examined 
cytology slides (gynecologic and nongynecologic) in the 100 slide 
workload limit.
    (3) The laboratory must maintain records of the total number of 
slides examined by each individual during each 24-hour period and the 
number of hours spent examining slides in the 24-hour period 
irrespective of the site or laboratory.
    (4) Records are available to document the workload limit for each 
individual.
    (e) Slide examination and reporting. The laboratory must establish 
and follow written policies and procedures that ensure the following:
    (1) A technical supervisor confirms each gynecologic slide 
preparation interpreted to exhibit reactive or reparative changes or any 
of the following epithelial cell abnormalities:
    (i) Squamous cell.
    (A) Atypical squamous cells of undetermined significance (ASC-US) or 
cannot exclude HSIL (ASC-H).
    (B) LSIL-Human papillomavirus (HPV)/mild dysplasia/cervical 
intraepithelial neoplasia 1 (CIN 1).
    (C) HSIL-moderate and severe dysplasia, carcinoma in situ (CIS)/CIN 
2 and CIN 3 or with features suspicious for invasion.
    (D) Squamous cell carcinoma.
    (ii) Glandular cell.
    (A) Atypical cells not otherwise specified (NOS) or specified in 
comments (endocervical, endometrial, or glandular).
    (B) Atypical cells favor neoplastic (endocervical or glandular).
    (C) Endocervical adenocarcinoma in situ.
    (D) Adenocarcinoma endocervical, adenocarcinoma endometrial, 
adenocarcinoma extrauterine, and adenocarcinoma NOS.
    (iii) Other malignant neoplasms.
    (2) The report of gynecologic slide preparations with conditions 
specified in paragraph (e)(1) of this section must be signed to reflect 
the technical supervisory review or, if a computer report is generated 
with signature, it must reflect an electronic signature authorized by 
the technical supervisor who performed the review.
    (3) All nongynecologic preparations are reviewed by a technical 
supervisor. The report must be signed to reflect technical supervisory 
review or, if a computer report is generated with signature, it must 
reflect an electronic signature authorized by the technical supervisor 
who performed the review.
    (4) Unsatisfactory specimens or slide preparations are identified 
and reported as unsatisfactory.
    (5) The report contains narrative descriptive nomenclature for all 
results.
    (6) Corrected reports issued by the laboratory indicate the basis 
for correction.
    (f) Record and slide retention. (1) The laboratory must retain all 
records and slide preparations as specified in Sec.  493.1105.
    (2) Slides may be loaned to proficiency testing programs in lieu of 
maintaining them for the required time period, provided the laboratory 
receives written acknowledgment of the receipt of slides by the 
proficiency testing program and maintains the acknowledgment to document 
the loan of these slides.
    (3) Documentation of slides loaned or referred for purposes other 
than proficiency testing must be maintained.
    (4) All slides must be retrievable upon request.
    (g) Automated and semi-automated screening devices. When performing 
evaluations using automated and semi-automated screening devices, the 
laboratory must follow manufacturer's instructions for preanalytic, 
analytic, and postanalytic phases of testing, as applicable, and meet 
the applicable requirements of this subpart K.

[[Page 584]]

    (h) Documentation. The laboratory must document all control 
procedures performed, as specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1276  Standard: Clinical cytogenetics.

    (a) The laboratory must have policies and procedures for ensuring 
accurate and reliable patient specimen identification during the process 
of accessioning, cell preparation, photographing or other image 
reproduction technique, photographic printing, and reporting and storage 
of results, karyotypes, and photographs.
    (b) The laboratory must have records that document the following:
    (1) The media used, reactions observed, number of cells counted, 
number of cells karyotyped, number of chromosomes counted for each 
metaphase spread, and the quality of the banding.
    (2) The resolution is appropriate for the type of tissue or specimen 
and the type of study required based on the clinical information 
provided to the laboratory.
    (3) An adequate number of karyotypes are prepared for each patient.
    (c) Determination of sex must be performed by full chromosome 
analysis.
    (d) The laboratory report must include a summary and interpretation 
of the observations, number of cells counted and analyzed, and use the 
International System for Human Cytogenetic Nomenclature.
    (e) The laboratory must document all control procedures performed, 
as specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1278  Standard: Histocompatibility.

    (a) General. The laboratory must meet the following requirements:
    (1) An audible alarm system must be used to monitor the storage 
temperature of specimens (donor and recipient) and reagents. The 
laboratory must have an emergency plan for alternate storage.
    (2) All patient specimens must be easily retrievable.
    (3) Reagent typing sera inventory prepared in-house must indicate 
source, bleeding date and identification number, reagent specificity, 
and volume remaining.
    (4) If the laboratory uses immunologic reagents (for example, 
antibodies, antibody-coated particles, or complement) to facilitate or 
enhance the isolation of lymphocytes, or lymphocyte subsets, the 
efficacy of the methods must be monitored with appropriate quality 
control procedures.
    (5) Participate in at least one national or regional cell exchange 
program, if available, or develop an exchange system with another 
laboratory in order to validate interlaboratory reproducibility.
    (b) HLA typing. The laboratory must do the following:
    (1) Use a technique(s) that is established to optimally define, as 
applicable, HLA Class I and II specificities.
    (2) HLA type all potential transplant recipients at a level 
appropriate to support clinical transplant protocol and donor selection.
    (3) HLA type cells from organ donors referred to the laboratory.
    (4) Use HLA antigen terminology that conforms to the latest report 
of the World Health Organization (W.H.O.) Committee on Nomenclature. 
Potential new antigens not yet approved by this committee must have a 
designation that cannot be confused with W.H.O. terminology.
    (5) Have available and follow written criteria for the following:
    (i) The preparation of cells or cellular extracts (for example, 
solubilized antigens and nucleic acids), as applicable to the HLA typing 
technique(s) performed.
    (ii) Selecting typing reagents, whether prepared in-house or 
commercially.
    (iii) Ensuring that reagents used for typing are adequate to define 
all HLA-A, B and DR specificities that are officially recognized by the 
most recent W.H.O. Committee on Nomenclature and for which reagents are 
readily available.
    (iv) The assignment of HLA antigens.
    (v) When antigen redefinition and retyping are required.
    (6) Check each HLA typing by testing, at a minimum the following:

[[Page 585]]

    (i) A positive control material.
    (ii) A negative control material in which, if applicable to the 
technique performed, cell viability at the end of incubation is 
sufficient to permit accurate interpretation of results. In assays in 
which cell viability is not required, the negative control result must 
be sufficiently different from the positive control result to permit 
accurate interpretation of results.
    (iii) Positive control materials for specific cell types when 
applicable (that is, T cells, B cells, and monocytes).
    (c) Disease-associated studies. The laboratory must check each 
typing for disease-associated HLA antigens using control materials to 
monitor the test components and each phase of the test system to ensure 
acceptable performance.
    (d) Antibody Screening. The laboratory must do the following:
    (1) Use a technique(s) that detects HLA-specific antibody with a 
specificity equivalent or superior to that of the basic complement-
dependent microlymphocytotoxicity assay.
    (2) Use a method that distinguishes antibodies to HLA Class II 
antigens from antibodies to Class I antigens to detect antibodies to HLA 
Class II antigens.
    (3) Use a panel that contains all the major HLA specificities and 
common splits. If the laboratory does not use commercial panels, it must 
maintain a list of individuals for fresh panel bleeding.
    (4) Make a reasonable attempt to have available monthly serum 
specimens for all potential transplant recipients for periodic antibody 
screening and crossmatch.
    (5) Have available and follow a written policy consistent with 
clinical transplant protocols for the frequency of screening potential 
transplant recipient sera for preformed HLA-specific antibodies.
    (6) Check each antibody screening by testing, at a minimum the 
following:
    (i) A positive control material containing antibodies of the 
appropriate isotype for the assay.
    (ii) A negative control material.
    (7) As applicable, have available and follow written criteria and 
procedures for antibody identification to the level appropriate to 
support clinical transplant protocol.
    (e) Crossmatching. The laboratory must do the following:
    (1) Use a technique(s) documented to have increased sensitivity in 
comparison with the basic complement-dependent microlymphocytotoxicity 
assay.
    (2) Have available and follow written criteria for the following:
    (i) Selecting appropriate patient serum samples for crossmatching.
    (ii) The preparation of donor cells or cellular extracts (for 
example, solubilized antigens and nucleic acids), as applicable to the 
crossmatch technique(s) performed.
    (3) Check each crossmatch and compatibility test for HLA Class II 
antigenic differences using control materials to monitor the test 
components and each phase of the test system to ensure acceptable 
performance.
    (f) Transplantation. Laboratories performing histocompatibility 
testing for transfusion and transplantation purposes must do the 
following:
    (1) Have available and follow written policies and protocols 
specifying the histocompatibility testing (that is, HLA typing, antibody 
screening, compatibility testing and crossmatching) to be performed for 
each type of cell, tissue or organ to be transfused or transplanted. The 
laboratory's policies must include, as applicable--
    (i) Testing protocols for cadaver donor, living, living-related, and 
combined organ and tissue transplants;
    (ii) Testing protocols for patients at high risk for allograft 
rejection; and
    (iii) The level of testing required to support clinical transplant 
protocols (for example, antigen or allele level).
    (2) For renal allotransplantation and combined organ and tissue 
transplants in which a kidney is to be transplanted, have available 
results of final crossmatches before the kidney is transplanted.
    (3) For nonrenal transplantation, if HLA testing and final 
crossmatches were not performed prospectively because of an emergency 
situation, the laboratory must document the circumstances, if known, 
under which the emergency transplant was performed,

[[Page 586]]

and records of the transplant must reflect any information provided to 
the laboratory by the patient's physician.
    (g) Documentation. The laboratory must document all control 
procedures performed, as specified in this section.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1281  Standard: Comparison of test results.

    (a) If a laboratory performs the same test using different 
methodologies or instruments, or performs the same test at multiple 
testing sites, the laboratory must have a system that twice a year 
evaluates and defines the relationship between test results using the 
different methodologies, instruments, or testing sites.
    (b) The laboratory must have a system to identify and assess patient 
test results that appear inconsistent with the following relevant 
criteria, when available:
    (1) Patient age.
    (2) Sex.
    (3) Diagnosis or pertinent clinical data.
    (4) Distribution of patient test results.
    (5) Relationship with other test parameters.
    (c) The laboratory must document all test result comparison 
activities.



Sec.  493.1282  Standard: Corrective actions.

    (a) Corrective action policies and procedures must be available and 
followed as necessary to maintain the laboratory's operation for testing 
patient specimens in a manner that ensures accurate and reliable patient 
test results and reports.
    (b) The laboratory must document all corrective actions taken, 
including actions taken when any of the following occur:
    (1) Test systems do not meet the laboratory's verified or 
established performance specifications, as determined in Sec.  
493.1253(b), which include but are not limited to--
    (i) Equipment or methodologies that perform outside of established 
operating parameters or performance specifications;
    (ii) Patient test values that are outside of the laboratory's 
reportable range of test results for the test system; and
    (iii) When the laboratory determines that the reference intervals 
(normal values) for a test procedure are inappropriate for the 
laboratory's patient population.
    (2) Results of control or calibration materials, or both, fail to 
meet the laboratory's established criteria for acceptability. All 
patient test results obtained in the unacceptable test run and since the 
last acceptable test run must be evaluated to determine if patient test 
results have been adversely affected. The laboratory must take the 
corrective action necessary to ensure the reporting of accurate and 
reliable patient test results.
    (3) The criteria for proper storage of reagents and specimens, as 
specified under Sec.  493.1252(b), are not met.



Sec.  493.1283  Standard: Test records.

    (a) The laboratory must maintain an information or record system 
that includes the following:
    (1) The positive identification of the specimen.
    (2) The date and time of specimen receipt into the laboratory.
    (3) The condition and disposition of specimens that do not meet the 
laboratory's criteria for specimen acceptability.
    (4) The records and dates of all specimen testing, including the 
identity of the personnel who performed the test(s).
    (b) Records of patient testing including, if applicable, instrument 
printouts, must be retained.



Sec.  493.1289  Standard: Analytic systems quality assessment.

    (a) The laboratory must establish and follow written policies and 
procedures for an ongoing mechanism to monitor, assess, and when 
indicated, correct problems identified in the analytic systems specified 
in Sec. Sec.  493.1251 through 493.1283.
    (b) The analytic systems quality assessment must include a review of 
the effectiveness of corrective actions taken to resolve problems, 
revision of policies and procedures necessary to

[[Page 587]]

prevent recurrence of problems, and discussion of analytic systems 
quality assessment reviews with appropriate staff.
    (c) The laboratory must document all analytic systems quality 
assessment activities.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]

                          Postanalytic Systems



Sec.  493.1290  Condition: Postanalytic systems.

    Each laboratory that performs nonwaived testing must meet the 
applicable postanalytic systems requirements in Sec.  493.1291 unless 
HHS approves a procedure, specified in Appendix C of the State 
Operations Manual (CMS Pub. 7) that provides equivalent quality testing. 
The laboratory must monitor and evaluate the overall quality of the 
postanalytic systems and correct identified problems as specified in 
Sec.  493.1299 for each specialty and subspecialty of testing performed.



Sec.  493.1291  Standard: Test report.

    (a) The laboratory must have an adequate manual or electronic 
system(s) in place to ensure test results and other patient-specific 
data are accurately and reliably sent from the point of data entry 
(whether interfaced or entered manually) to final report destination, in 
a timely manner. This includes the following:
    (1) Results reported from calculated data.
    (2) Results and patient-specific data electronically reported to 
network or interfaced systems.
    (3) Manually transcribed or electronically transmitted results and 
patient-specific information reported directly or upon receipt from 
outside referral laboratories, satellite or point-of-care testing 
locations.
    (b) Test report information maintained as part of the patient's 
chart or medical record must be readily available to the laboratory and 
to CMS or a CMS agent upon request.
    (c) The test report must indicate the following:
    (1) For positive patient identification, either the patient's name 
and identification number, or a unique patient identifier and 
identification number.
    (2) The name and address of the laboratory location where the test 
was performed.
    (3) The test report date.
    (4) The test performed.
    (5) Specimen source, when appropriate.
    (6) The test result and, if applicable, the units of measurement or 
interpretation, or both.
    (7) Any information regarding the condition and disposition of 
specimens that do not meet the laboratory's criteria for acceptability.
    (d) Pertinent ``reference intervals'' or ``normal'' values, as 
determined by the laboratory performing the tests, must be available to 
the authorized person who ordered the tests and, if applicable, the 
individual responsible for using the test results.
    (e) The laboratory must, upon request, make available to clients a 
list of test methods employed by the laboratory and, as applicable, the 
performance specifications established or verified as specified in Sec.  
493.1253. In addition, information that may affect the interpretation of 
test results, for example test interferences, must be provided upon 
request. Pertinent updates on testing information must be provided to 
clients whenever changes occur that affect the test results or 
interpretation of test results.
    (f) Test results must be released only to authorized persons and, if 
applicable, the individual responsible for using the test results and 
the laboratory that initially requested the test.
    (g) The laboratory must immediately alert the individual or entity 
requesting the test and, if applicable, the individual responsible for 
using the test results when any test result indicates an imminently 
life-threatening condition, or panic or alert values.
    (h) When the laboratory cannot report patient test results within 
its established time frames, the laboratory must determine, based on the 
urgency of the patient test(s) requested, the need to notify the 
appropriate individual(s) of the delayed testing.
    (i) If a laboratory refers patient specimens for testing--

[[Page 588]]

    (1) The referring laboratory must not revise results or information 
directly related to the interpretation of results provided by the 
testing laboratory;
    (2) The referring laboratory may permit each testing laboratory to 
send the test result directly to the authorized person who initially 
requested the test. The referring laboratory must retain or be able to 
produce an exact duplicate of each testing laboratory's report; and
    (3) The authorized person who orders a test must be notified by the 
referring laboratory of the name and address of each laboratory location 
where the test was performed.
    (j) All test reports or records of the information on the test 
reports must be maintained by the laboratory in a manner that permits 
ready identification and timely accessibility.
    (k) When errors in the reported patient test results are detected, 
the laboratory must do the following:
    (1) Promptly notify the authorized person ordering the test and, if 
applicable, the individual using the test results of reporting errors.
    (2) Issue corrected reports promptly to the authorized person 
ordering the test and, if applicable, the individual using the test 
results.
    (3) Maintain duplicates of the original report, as well as the 
corrected report.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]



Sec.  493.1299  Standard: Postanalytic systems quality assessment.

    (a) The laboratory must establish and follow written policies and 
procedures for an ongoing mechanism to monitor, assess and, when 
indicated, correct problems identified in the postanalytic systems 
specified in Sec.  493.1291.
    (b) The postanalytic systems quality assessment must include a 
review of the effectiveness of corrective actions taken to resolve 
problems, revision of policies and procedures necessary to prevent 
recurrence of problems, and discussion of postanalytic systems quality 
assessment reviews with appropriate staff.
    (c) The laboratory must document all postanalytic systems quality 
assessment activities.

[68 FR 3703, Jan. 24, 2003; 68 FR 50724, Aug. 22, 2003]

Subpart L [Reserved]



                Subpart M_Personnel for Nonwaived Testing

    Source: 57 FR 7172, Feb. 28, 1992, unless otherwise noted.



Sec.  493.1351  General.

    This subpart consists of the personnel requirements that must be met 
by laboratories performing moderate complexity testing, PPM procedures, 
high complexity testing, or any combination of these tests.

[60 FR 20049, Apr. 24, 1995]

 Laboratories Performing Provider-Performed Microscopy (PPM) Procedures

    Source: 60 FR 20049, Apr. 24, 1995, unless otherwise noted.



Sec.  493.1353  Scope.

    In accordance with Sec.  493.19(b), the moderate complexity 
procedures specified as PPM procedures are considered such only when 
personally performed by a health care provider during a patient visit in 
the context of a physical examination. PPM procedures are subject to the 
personnel requirements in Sec. Sec.  493.1355 through 493.1365.



Sec.  493.1355  Condition: Laboratories performing PPM procedures; laboratory director.

    The laboratory must have a director who meets the qualification 
requirements of Sec.  493.1357 and provides overall management and 
direction in accordance with Sec.  493.1359.



Sec.  493.1357  Standard; laboratory director qualifications.

    The laboratory director must be qualified to manage and direct the 
laboratory personnel and the performance of PPM procedures as specified 
in Sec.  493.19(c) and must be eligible to be an

[[Page 589]]

operator of a laboratory within the requirements of subpart R of this 
part.
    (a) The laboratory director must possess a current license as a 
laboratory director issued by the State in which the laboratory is 
located, if the licensing is required.
    (b) The laboratory director must meet one of the following 
requirements:
    (1) Be a physician, as defined in Sec.  493.2.
    (2) Be a midlevel practitioner, as defined in Sec.  493.2, 
authorized by a State to practice independently in the State in which 
the laboratory is located.
    (3) Be a dentist, as defined in Sec.  493.2.



Sec.  493.1359  Standard; PPM laboratory director responsibilities.

    The laboratory director is responsible for the overall operation and 
administration of the laboratory, including the prompt, accurate, and 
proficient reporting of test results. The laboratory director must--
    (a) Direct no more than five laboratories; and
    (b) Ensure that any procedure listed under Sec.  493.19(c)--
    (1) Is personally performed by an individual who meets the 
qualification requirements in Sec.  493.1363; and
    (2) Is performed in accordance with applicable requirements in 
subparts H, J, K, and M of this part.

[57 FR 7172, Feb. 28, 1992, as amended at 68 FR 3713, Jan. 24, 2003; 68 
FR 50724, Aug. 22, 2003]



Sec.  493.1361  Condition: Laboratories performing PPM procedures; testing personnel.

    The laboratory must have a sufficient number of individuals who meet 
the qualification requirements of Sec.  493.1363 to perform the 
functions specified in Sec.  493.1365 for the volume and complexity of 
testing performed.



Sec.  493.1363  Standard: PPM testing personnel qualifications.

    Each individual performing PPM procedures must--
    (a) Possess a current license issued by the State in which the 
laboratory is located if the licensing is required; and
    (b) Meet one of the following requirements:
    (1) Be a physician, as defined in Sec.  493.2.
    (2) Be a midlevel practitioner, as defined in Sec.  493.2, under the 
supervision of a physician or in independent practice if authorized by 
the State in which the laboratory is located.
    (3) Be a dentist as defined in Sec.  493.2 of this part.



Sec.  493.1365  Standard; PPM testing personnel responsibilities.

    The testing personnel are responsible for specimen processing, test 
performance, and for reporting test results. Any PPM procedure must be--
    (a) Personally performed by one of the following practitioners:
    (1) A physician during the patient's visit on a specimen obtained 
from his or her own patient or from a patient of a group medical 
practice of which the physician is a member or employee.
    (2) A midlevel practitioner, under the supervision of a physician or 
in independent practice if authorized by the State in which the 
laboratory is located, during the patient's visit on a specimen obtained 
from his or her own patient or from the patient of a clinic, group 
medical practice, or other health care provider, in which the midlevel 
practitioner is a member or an employee.
    (3) A dentist during the patient's visit on a specimen obtained from 
his or her own patient or from a patient of a group dental practice of 
which the dentist is a member or an employee; and
    (b) Performed using a microscope limited to a brightfield or a 
phase/contrast microscope.

           Laboratories Performing Moderate Complexity Testing



Sec.  493.1403  Condition: Laboratories performing moderate complexity testing; laboratory director.

    The laboratory must have a director who meets the qualification 
requirements of Sec.  493.1405 of this subpart and provides overall 
management and direction in accordance with Sec.  493.1407 of this 
subpart.

[[Page 590]]



Sec.  493.1405  Standard; Laboratory director qualifications.

    The laboratory director must be qualified to manage and direct the 
laboratory personnel and the performance of moderate complexity tests 
and must be eligible to be an operator of a laboratory within the 
requirements of subpart R of this part.
    (a) The laboratory director must possess a current license as a 
laboratory director issued by the State in which the laboratory is 
located, if such licensing is required; and
    (b) The laboratory director must--
    (1) (i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in anatomic or clinical pathology, or both, by the 
American Board of Pathology or the American Osteopathic Board of 
Pathology or possess qualifications that are equivalent to those 
required for such certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have had laboratory training or experience consisting of:
    (A) At least one year directing or supervising non-waived laboratory 
testing; or
    (B) Beginning September 1, 1993, have at least 20 continuing medical 
education credit hours in laboratory practice commensurate with the 
director responsibilities defined in Sec.  493.1407; or
    (C) Laboratory training equivalent to paragraph (b)(2)(ii)(B) of 
this section obtained during medical residency. (For example, physicians 
certified either in hematology or hematology and medical oncology by the 
American Board of Internal Medicine); or
    (3) Hold an earned doctoral degree in a chemical, physical, 
biological, or clinical laboratory science from an accredited 
institution; and
    (i) Be certified by the American Board of Medical Microbiology, the 
American Board of Clinical Chemistry, the American Board of Bioanalysis, 
or the American Board of Medical Laboratory Immunology; or
    (ii) Have had at least one year experience directing or supervising 
non-waived laboratory testing;
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution;
    (ii) Have at least one year of laboratory training or experience, or 
both in non-waived testing; and
    (iii) In addition, have at least one year of supervisory laboratory 
experience in non-waived testing; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical, or 
biological science or medical technology from an accredited institution;
    (ii) Have at least 2 years of laboratory training or experience, or 
both in non-waived testing; and
    (iii) In addition, have at least 2 years of supervisory laboratory 
experience in non-waived testing;
    (6) Be serving as a laboratory director and must have previously 
qualified or could have qualified as a laboratory director under Sec.  
493.1406; or
    (7) On or before February 28, 1992, qualified under State law to 
direct a laboratory in the State in which the laboratory is located.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5233, Jan. 19, 1993]



Sec.  493.1406  Standard; Laboratory director qualifications on or before February 28, 1992.

    The laboratory director must be qualified to manage and direct the 
laboratory personnel and test performance.
    (a) The laboratory director must possess a current license as a 
laboratory director issued by the State, if such licensing exists; and
    (b) The laboratory director must:
    (1) Be a physician certified in anatomical or clinical pathology (or 
both) by the American Board of Pathology or the American Osteopathic 
Board of Pathology or possess qualifications that are equivalent to 
those required for such certification;
    (2) Be a physician who:
    (i) Is certified by the American Board of Pathology or the American 
Osteopathic Board of Pathology in at least one of the laboratory 
specialties; or

[[Page 591]]

    (ii) Is certified by the American Board of Medical Microbiology, the 
American Board of Clinical Chemistry, the American Board of Bioanalysis, 
or other national accrediting board in one of the laboratory 
specialties; or
    (iii) Is certified by the American Society of Cytology to practice 
cytopathology or possesses qualifications that are equivalent to those 
required for such certification; or
    (iv) Subsequent to graduation, has had 4 or more years of full-time 
general laboratory training and experience of which at least 2 years 
were spent acquiring proficiency in one of the laboratory specialties;
    (3) For the subspecialty of oral pathology only, be certified by the 
American Board of Oral Pathology, American Board of Pathology or the 
American Osteopathic Board of Pathology or possesses qualifications that 
are equivalent to those required for certification;
    (4) Hold an earned doctoral degree from an accredited institution 
with a chemical, physical, or biological science as a major subject and
    (i) Is certified by the American Board of Medical Microbiology, the 
American Board of Clinical Chemistry, the American Board of Bioanalysis, 
or other national accrediting board acceptable to HHS in one of the 
laboratory specialties; or
    (ii) Subsequent to graduation, has had 4 or more years of full-time 
general laboratory training and experience of which at least 2 years 
were spent acquiring proficiency in one of the laboratory specialties;
    (5) With respect to individuals first qualifying before July 1, 
1971, have been responsible for the direction of a laboratory for 12 
months between July 1, 1961, and January 1, 1968, and, in addition, 
either:
    (i) Was a physician and subsequent to graduation had at least 4 
years of pertinent full-time laboratory experience;
    (ii) Held a master's degree from an accredited institution with a 
chemical, physical, or biological science as a major subject and 
subsequent to graduation had at least 4 years of pertinent full-time 
laboratory experience;
    (iii) Held a bachelor's degree from an accredited institution with a 
chemical, physical, or biological science as a major subject and 
subsequent to graduation had at least 6 years of pertinent full-time 
laboratory experience; or
    (iv) Achieved a satisfactory grade through an examination conducted 
by or under the sponsorship of the U.S. Public Health Service on or 
before July 1, 1970; or
    (6) Qualify under State law to direct the laboratory in the State in 
which the laboratory is located.

    Note: The January 1, 1968 date for meeting the 12 months' laboratory 
direction requirement in paragraph (b)(5) of this section may be 
extended 1 year for each year of full-time laboratory experience 
obtained before January 1, 1958 required by State law for a laboratory 
director license. An exception to the July 1, 1971 qualifying date in 
paragraph (b)(5) of this section was made provided that the individual 
requested qualification approval by October 21, 1975 and had been 
employed in a laboratory for at least 3 years of the 5 years preceding 
the date of submission of his qualifications.

[58 FR 5233, Jan. 19, 1993]



Sec.  493.1407  Standard; Laboratory director responsibilities.

    The laboratory director is responsible for the overall operation and 
administration of the laboratory, including the employment of personnel 
who are competent to perform test procedures, and record and report test 
results promptly, accurate, and proficiently and for assuring compliance 
with the applicable regulations.
    (a) The laboratory director, if qualified, may perform the duties of 
the technical consultant, clinical consultant, and testing personnel, or 
delegate these responsibilities to personnel meeting the qualifications 
of Sec. Sec.  493.1409, 493.1415, and 493.1421, respectively.
    (b) If the laboratory director reapportions performance of his or 
her responsibilities, he or she remains responsible for ensuring that 
all duties are properly performed.
    (c) The laboratory director must be accessible to the laboratory to 
provide onsite, telephone or electronic consultation as needed.
    (d) Each individual may direct no more than five laboratories.
    (e) The laboratory director must--
    (1) Ensure that testing systems developed and used for each of the 
tests

[[Page 592]]

performed in the laboratory provide quality laboratory services for all 
aspects of test performance, which includes the preanalytic, analytic, 
and postanalytic phases of testing;
    (2) Ensure that the physical plant and environmental conditions of 
the laboratory are appropriate for the testing performed and provide a 
safe environment in which employees are protected from physical, 
chemical, and biological hazards;
    (3) Ensure that--
    (i) The test methodologies selected have the capability of providing 
the quality of results required for patient care;
    (ii) Verification procedures used are adequate to determine the 
accuracy, precision, and other pertinent performance characteristics of 
the method; and
    (iii) Laboratory personnel are performing the test methods as 
required for accurate and reliable results;
    (4) Ensure that the laboratory is enrolled in an HHS approved 
proficiency testing program for the testing performed and that--
    (i) The proficiency testing samples are tested as required under 
subpart H of this part;
    (ii) The results are returned within the timeframes established by 
the proficiency testing program;
    (iii) All proficiency testing reports received are reviewed by the 
appropriate staff to evaluate the laboratory's performance and to 
identify any problems that require corrective action; and
    (iv) An approved corrective action plan is followed when any 
proficiency testing results are found to be unacceptable or 
unsatisfactory;
    (5) Ensure that the quality control and quality assessment programs 
are established and maintained to assure the quality of laboratory 
services provided and to identify failures in quality as they occur;
    (6) Ensure the establishment and maintenance of acceptable levels of 
analytical performance for each test system;
    (7) Ensure that all necessary remedial actions are taken and 
documented whenever significant deviations from the laboratory's 
established performance specifications are identified, and that patient 
test results are reported only when the system is functioning properly;
    (8) Ensure that reports of test results include pertinent 
information required for interpretation;
    (9) Ensure that consultation is available to the laboratory's 
clients on matters relating to the quality of the test results reported 
and their interpretation concerning specific patient conditions;
    (10) Employ a sufficient number of laboratory personnel with the 
appropriate education and either experience or training to provide 
appropriate consultation, properly supervise and accurately perform 
tests and report test results in accordance with the personnel 
responsibilities described in this subpart;
    (11) Ensure that prior to testing patients' specimens, all personnel 
have the appropriate education and experience, receive the appropriate 
training for the type and complexity of the services offered, and have 
demonstrated that they can perform all testing operations reliably to 
provide and report accurate results;
    (12) Ensure that policies and procedures are established for 
monitoring individuals who conduct preanalytical, analytical, and 
postanalytical phases of testing to assure that they are competent and 
maintain their competency to process specimens, perform test procedures 
and report test results promptly and proficiently, and whenever 
necessary, identify needs for remedial training or continuing education 
to improve skills;
    (13) Ensure that an approved procedure manual is available to all 
personnel responsible for any aspect of the testing process; and
    (14) Specify, in writing, the responsibilities and duties of each 
consultant and each person, engaged in the performance of the 
preanalytic, analytic, and postanalytic phases of testing, that 
identifies which examinations and procedures each individual is 
authorized to perform, whether supervision is required for specimen 
processing, test performance or results reporting, and whether 
consultant or director review

[[Page 593]]

is required prior to reporting patient test results.

[57 FR 7172, Feb. 28, 1992, as amended at 68 FR 3713, Jan. 24, 2003]



Sec.  493.1409  Condition: Laboratories performing moderate complexity testing; technical consultant.

    The laboratory must have a technical consultant who meets the 
qualification requirements of Sec.  493.1411 of this subpart and 
provides technical oversight in accordance with Sec.  493.1413 of this 
subpart.



Sec.  493.1411  Standard; Technical consultant qualifications.

    The laboratory must employ one or more individuals who are qualified 
by education and either training or experience to provide technical 
consultation for each of the specialties and subspecialties of service 
in which the laboratory performs moderate complexity tests or 
procedures. The director of a laboratory performing moderate complexity 
testing may function as the technical consultant provided he or she 
meets the qualifications specified in this section.
    (a) The technical consultant must possess a current license issued 
by the State in which the laboratory is located, if such licensing is 
required.
    (b) The technical consultant must--
    (1) (i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in anatomic or clinical pathology, or both, by the 
American Board of Pathology or the American Osteopathic Board of 
Pathology or possess qualifications that are equivalent to those 
required for such certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least one year of laboratory training or experience, or 
both in non-waived testing, in the designated specialty or subspecialty 
areas of service for which the technical consultant is responsible (for 
example, physicians certified either in hematology or hematology and 
medical oncology by the American Board of Internal Medicine are 
qualified to serve as the technical consultant in hematology); or
    (3)(i) Hold an earned doctoral or master's degree in a chemical, 
physical, biological or clinical laboratory science or medical 
technology from an accredited institution; and
    (ii) Have at least one year of laboratory training or experience, or 
both in non-waived testing, in the designated specialty or subspecialty 
areas of service for which the technical consultant is responsible; or
    (4)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 2 years of laboratory training or experience, or 
both in non-waived testing, in the designated specialty or subspecialty 
areas of service for which the technical consultant is responsible.

    Note: The technical consultant requirements for ``laboratory 
training or experience, or both'' in each specialty or subspecialty may 
be acquired concurrently in more than one of the specialties or 
subspecialties of service, excluding waived tests. For example, an 
individual who has a bachelor's degree in biology and additionally has 
documentation of 2 years of work experience performing tests of moderate 
complexity in all specialties and subspecialties of service, would be 
qualified as a technical consultant in a laboratory performing moderate 
complexity testing in all specialties and subspecialties of service.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5234, Jan. 19, 1993]



Sec.  493.1413  Standard; Technical consultant responsibilities.

    The technical consultant is responsible for the technical and 
scientific oversight of the laboratory. The technical consultant is not 
required to be onsite at all times testing is performed; however, he or 
she must be available to the laboratory on an as needed basis to provide 
consultation, as specified in paragraph (a) of this section.
    (a) The technical consultant must be accessible to the laboratory to 
provide on-site, telephone, or electronic consultation; and
    (b) The technical consultant is responsible for--

[[Page 594]]

    (1) Selection of test methodology appropriate for the clinical use 
of the test results;
    (2) Verification of the test procedures performed and the 
establishment of the laboratory's test performance characteristics, 
including the precision and accuracy of each test and test system;
    (3) Enrollment and participation in an HHS approved proficiency 
testing program commensurate with the services offered;
    (4) Establishing a quality control program appropriate for the 
testing performed and establishing the parameters for acceptable levels 
of analytic performance and ensuring that these levels are maintained 
throughout the entire testing process from the initial receipt of the 
specimen, through sample analysis and reporting of test results;
    (5) Resolving technical problems and ensuring that remedial actions 
are taken whenever test systems deviate from the laboratory's 
established performance specifications;
    (6) Ensuring that patient test results are not reported until all 
corrective actions have been taken and the test system is functioning 
properly;
    (7) Identifying training needs and assuring that each individual 
performing tests receives regular in-service training and education 
appropriate for the type and complexity of the laboratory services 
performed;
    (8) Evaluating the competency of all testing personnel and assuring 
that the staff maintain their competency to perform test procedures and 
report test results promptly, accurately and proficiently. The 
procedures for evaluation of the competency of the staff must include, 
but are not limited to--
    (i) Direct observations of routine patient test performance, 
including patient preparation, if applicable, specimen handling, 
processing and testing;
    (ii) Monitoring the recording and reporting of test results;
    (iii) Review of intermediate test results or worksheets, quality 
control records, proficiency testing results, and preventive maintenance 
records;
    (iv) Direct observation of performance of instrument maintenance and 
function checks;
    (v) Assessment of test performance through testing previously 
analyzed specimens, internal blind testing samples or external 
proficiency testing samples; and
    (vi) Assessment of problem solving skills; and
    (9) Evaluating and documenting the performance of individuals 
responsible for moderate complexity testing at least semiannually during 
the first year the individual tests patient specimens. Thereafter, 
evaluations must be performed at least annually unless test methodology 
or instrumentation changes, in which case, prior to reporting patient 
test results, the individual's performance must be reevaluated to 
include the use of the new test methodology or instrumentation.



Sec.  493.1415  Condition: Laboratories performing moderate complexity testing; clinical consultant.

    The laboratory must have a clinical consultant who meets the 
qualification requirements of Sec.  493.1417 of this part and provides 
clinical consultation in accordance with Sec.  493.1419 of this part.



Sec.  493.1417  Standard; Clinical consultant qualifications.

    The clinical consultant must be qualified to consult with and render 
opinions to the laboratory's clients concerning the diagnosis, treatment 
and management of patient care. The clinical consultant must--
    (a) Be qualified as a laboratory director under Sec.  493.1405(b) 
(1), (2), or (3)(i); or
    (b) Be a doctor of medicine, doctor of osteopathy or doctor of 
podiatric medicine and possess a license to practice medicine, 
osteopathy or podiatry in the State in which the laboratory is located.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5234, Jan. 19, 1993]



Sec.  493.1419  Standard; Clinical consultant responsibilities.

    The clinical consultant provides consultation regarding the 
appropriateness of the testing ordered and interpretation of test 
results. The clinical consultant must--

[[Page 595]]

    (a) Be available to provide clinical consultation to the 
laboratory's clients;
    (b) Be available to assist the laboratory's clients in ensuring that 
appropriate tests are ordered to meet the clinical expectations;
    (c) Ensure that reports of test results include pertinent 
information required for specific patient interpretation; and
    (d) Ensure that consultation is available and communicated to the 
laboratory's clients on matters related to the quality of the test 
results reported and their interpretation concerning specific patient 
conditions.



Sec.  493.1421  Condition: Laboratories performing moderate complexity testing; testing personnel.

    The laboratory must have a sufficient number of individuals who meet 
the qualification requirements of Sec.  493.1423, to perform the 
functions specified in Sec.  493.1425 for the volume and complexity of 
tests performed.



Sec.  493.1423  Standard; Testing personnel qualifications.

    Each individual performing moderate complexity testing must--
    (a) Possess a current license issued by the State in which the 
laboratory is located, if such licensing is required; and
    (b) Meet one of the following requirements:
    (1) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located or have earned a doctoral, master's, or bachelor's degree in a 
chemical, physical, biological or clinical laboratory science, or 
medical technology from an accredited institution; or
    (2) Have earned an associate degree in a chemical, physical or 
biological science or medical laboratory technology from an accredited 
institution; or
    (3) Be a high school graduate or equivalent and have successfully 
completed an official military medical laboratory procedures course of 
at least 50 weeks duration and have held the military enlisted 
occupational specialty of Medical Laboratory Specialist (Laboratory 
Technician); or
    (4)(i) Have earned a high school diploma or equivalent; and
    (ii) Have documentation of training appropriate for the testing 
performed prior to analyzing patient specimens. Such training must 
ensure that the individual has--
    (A) The skills required for proper specimen collection, including 
patient preparation, if applicable, labeling, handling, preservation or 
fixation, processing or preparation, transportation and storage of 
specimens;
    (B) The skills required for implementing all standard laboratory 
procedures;
    (C) The skills required for performing each test method and for 
proper instrument use;
    (D) The skills required for performing preventive maintenance, 
troubleshooting and calibration procedures related to each test 
performed;
    (E) A working knowledge of reagent stability and storage;
    (F) The skills required to implement the quality control policies 
and procedures of the laboratory;
    (G) An awareness of the factors that influence test results; and
    (H) The skills required to assess and verify the validity of patient 
test results through the evaluation of quality control sample values 
prior to reporting patient test results.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5234, Jan. 19, 1993]



Sec.  493.1425  Standard; Testing personnel responsibilities.

    The testing personnel are responsible for specimen processing, test 
performance, and for reporting test results.
    (a) Each individual performs only those moderate complexity tests 
that are authorized by the laboratory director and require a degree of 
skill commensurate with the individual's education, training or 
experience, and technical abilities.
    (b) Each individual performing moderate complexity testing must--
    (1) Follow the laboratory's procedures for specimen handling and 
processing, test analyses, reporting and maintaining records of patient 
test results;

[[Page 596]]

    (2) Maintain records that demonstrate that proficiency testing 
samples are tested in the same manner as patient samples;
    (3) Adhere to the laboratory's quality control policies, document 
all quality control activities, instrument and procedural calibrations 
and maintenance performed;
    (4) Follow the laboratory's established corrective action policies 
and procedures whenever test systems are not within the laboratory's 
established acceptable levels of performance;
    (5) Be capable of identifying problems that may adversely affect 
test performance or reporting of test results and either must correct 
the problems or immediately notify the technical consultant, clinical 
consultant or director; and
    (6) Document all corrective actions taken when test systems deviate 
from the laboratory's established performance specifications.

             Laboratories Performing High Complexity Testing



Sec.  493.1441  Condition: Laboratories performing high complexity testing; laboratory director.

    The laboratory must have a director who meets the qualification 
requirements of Sec.  493.1443 of this subpart and provides overall 
management and direction in accordance with Sec.  493.1445 of this 
subpart.



Sec.  493.1443  Standard; Laboratory director qualifications.

    The laboratory director must be qualified to manage and direct the 
laboratory personnel and performance of high complexity tests and must 
be eligible to be an operator of a laboratory within the requirements of 
subpart R.
    (a) The laboratory director must possess a current license as a 
laboratory director issued by the State in which the laboratory is 
located, if such licensing is required; and
    (b) The laboratory director must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in anatomic or clinical pathology, or both, by the 
American Board of Pathology or the American Osteopathic Board of 
Pathology or possess qualifications that are equivalent to those 
required for such certification; or
    (2) Be a doctor of medicine, a doctor of osteopathy or doctor of 
podiatric medicine licensed to practice medicine, osteopathy or podiatry 
in the State in which the laboratory is located; and
    (i) Have at least one year of laboratory training during medical 
residency (for example, physicians certified either in hematology or 
hematology and medical oncology by the American Board of Internal 
Medicine); or
    (ii) Have at least 2 years of experience directing or supervising 
high complexity testing; or
    (3) Hold an earned doctoral degree in a chemical, physical, 
biological, or clinical laboratory science from an accredited 
institution and--
    (i) Be certified and continue to be certified by a board approved by 
HHS; or
    (ii) Before February 24, 2003, must have served or be serving as a 
director of a laboratory performing high complexity testing and must 
have at least--
    (A) Two years of laboratory training or experience, or both; and
    (B) Two years of laboratory experience directing or supervising high 
complexity testing.
    (4) Be serving as a laboratory director and must have previously 
qualified or could have qualified as a laboratory director under 
regulations at 42 CFR 493.1415, published March 14, 1990 at 55 FR 9538, 
on or before February 28, 1992; or
    (5) On or before February 28, 1992, be qualified under State law to 
direct a laboratory in the State in which the laboratory is located; or
    (6) For the subspecialty of oral pathology, be certified by the 
American Board of Oral Pathology, American Board of Pathology, the 
American Osteopathic Board of Pathology, or possess qualifications that 
are equivalent to those required for certification.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5234, Jan. 19, 1993; 59 
FR 62609, Dec. 6, 1994; 62 FR 25858, May 12, 1997; 63 FR 55034, Oct. 14, 
1998; 65 FR 82944, Dec. 29, 2000; 68 FR 3713, Jan. 24, 2003]

[[Page 597]]



Sec.  493.1445  Standard; Laboratory director responsibilities.

    The laboratory director is responsible for the overall operation and 
administration of the laboratory, including the employment of personnel 
who are competent to perform test procedures, record and report test 
results promptly, accurately and proficiently, and for assuring 
compliance with the applicable regulations.
    (a) The laboratory director, if qualified, may perform the duties of 
the technical supervisor, clinical consultant, general supervisor, and 
testing personnel, or delegate these responsibilities to personnel 
meeting the qualifications under Sec. Sec.  493.1447, 493.1453, 
493.1459, and 493.1487, respectively.
    (b) If the laboratory director reapportions performance of his or 
her responsibilities, he or she remains responsible for ensuring that 
all duties are properly performed.
    (c) The laboratory director must be accessible to the laboratory to 
provide onsite, telephone or electronic consultation as needed.
    (d) Each individual may direct no more than five laboratories.
    (e) The laboratory director must--
    (1) Ensure that testing systems developed and used for each of the 
tests performed in the laboratory provide quality laboratory services 
for all aspects of test performance, which includes the preanalytic, 
analytic, and postanalytic phases of testing;
    (2) Ensure that the physical plant and environmental conditions of 
the laboratory are appropriate for the testing performed and provide a 
safe environment in which employees are protected from physical, 
chemical, and biological hazards;
    (3) Ensure that--
    (i) The test methodologies selected have the capability of providing 
the quality of results required for patient care;
    (ii) Verification procedures used are adequate to determine the 
accuracy, precision, and other pertinent performance characteristics of 
the method; and
    (iii) Laboratory personnel are performing the test methods as 
required for accurate and reliable results;
    (4) Ensure that the laboratory is enrolled in an HHS-approved 
proficiency testing program for the testing performed and that--
    (i) The proficiency testing samples are tested as required under 
subpart H of this part;
    (ii) The results are returned within the timeframes established by 
the proficiency testing program;
    (iii) All proficiency testing reports received are reviewed by the 
appropriate staff to evaluate the laboratory's performance and to 
identify any problems that require corrective action; and
    (iv) An approved corrective action plan is followed when any 
proficiency testing result is found to be unacceptable or 
unsatisfactory;
    (5) Ensure that the quality control and quality assessment programs 
are established and maintained to assure the quality of laboratory 
services provided and to identify failures in quality as they occur;
    (6) Ensure the establishment and maintenance of acceptable levels of 
analytical performance for each test system;
    (7) Ensure that all necessary remedial actions are taken and 
documented whenever significant deviations from the laboratory's 
established performance characteristics are identified, and that patient 
test results are reported only when the system is functioning properly;
    (8) Ensure that reports of test results include pertinent 
information required for interpretation;
    (9) Ensure that consultation is available to the laboratory's 
clients on matters relating to the quality of the test results reported 
and their interpretation concerning specific patient conditions;
    (10) Ensure that a general supervisor provides on-site supervision 
of high complexity test performance by testing personnel qualified under 
Sec.  493.1489(b)(4);
    (11) Employ a sufficient number of laboratory personnel with the 
appropriate education and either experience or training to provide 
appropriate consultation, properly supervise and accurately perform 
tests and report test results in accordance with the personnel 
responsibilities described in this subpart;

[[Page 598]]

    (12) Ensure that prior to testing patients' specimens, all personnel 
have the appropriate education and experience, receive the appropriate 
training for the type and complexity of the services offered, and have 
demonstrated that they can perform all testing operations reliably to 
provide and report accurate results;
    (13) Ensure that policies and procedures are established for 
monitoring individuals who conduct preanalytical, analytical, and 
postanalytical phases of testing to assure that they are competent and 
maintain their competency to process specimens, perform test procedures 
and report test results promptly and proficiently, and whenever 
necessary, identify needs for remedial training or continuing education 
to improve skills;
    (14) Ensure that an approved procedure manual is available to all 
personnel responsible for any aspect of the testing process; and
    (15) Specify, in writing, the responsibilities and duties of each 
consultant and each supervisor, as well as each person engaged in the 
performance of the preanalytic, analytic, and postanalytic phases of 
testing, that identifies which examinations and procedures each 
individual is authorized to perform, whether supervision is required for 
specimen processing, test performance or result reporting and whether 
supervisory or director review is required prior to reporting patient 
test results.

[57 FR 7172, Feb. 28, 1992, as amended at 68 FR 3714, Jan. 24, 2003]



Sec.  493.1447  Condition: Laboratories performing high complexity testing; technical supervisor.

    The laboratory must have a technical supervisor who meets the 
qualification requirements of Sec.  493.1449 of this subpart and 
provides technical supervision in accordance with Sec.  493.1451 of this 
subpart.



Sec.  493.1449  Standard; Technical supervisor qualifications.

    The laboratory must employ one or more individuals who are qualified 
by education and either training or experience to provide technical 
supervision for each of the specialties and subspecialties of service in 
which the laboratory performs high complexity tests or procedures. The 
director of a laboratory performing high complexity testing may function 
as the technical supervisor provided he or she meets the qualifications 
specified in this section.
    (a) The technical supervisor must possess a current license issued 
by the State in which the laboratory is located, if such licensing is 
required; and
    (b) The laboratory may perform anatomic and clinical laboratory 
procedures and tests in all specialties and subspecialties of services 
except histocompatibility and clinical cytogenetics services provided 
the individual functioning as the technical supervisor--
    (1) Is a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (2) Is certified in both anatomic and clinical pathology by the 
American Board of Pathology or the American Osteopathic Board of 
Pathology or Possesses qualifications that are equivalent to those 
required for such certification.
    (c) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of bacteriology, 
the individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least one year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of bacteriology; or

[[Page 599]]

    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of bacteriology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of bacteriology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical, or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of bacteriology.
    (d) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of 
mycobacteriology, the individual functioning as the technical supervisor 
must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor or 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycobacteriology; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycobacteriology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycobacteriology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycobacteriology.
    (e) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of mycology, the 
individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and

[[Page 600]]

    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycology; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both in high complexity testing within the speciality of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of mycology.
    (f) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of parasitology, 
the individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least one year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of parasitology;
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of parasitology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of parasitology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of parasitology.
    (g) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of virology, the 
individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or

[[Page 601]]

the American Osteopathic Board of Pathology or possess qualifications 
that are equivalent to those required for such certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of virology; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of virology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of virology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing within the specialty of microbiology 
with a minimum of 6 months experience in high complexity testing within 
the subspecialty of virology.
    (h) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the specialty of diagnostic 
immunology, the individual functioning as the technical supervisor 
must--
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing for the specialty of diagnostic 
immunology; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of diagnostic 
immunology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of diagnostic 
immunology; or
    (5) (i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of diagnostic 
immunology.
    (i) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the specialty of chemistry, the 
individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or

[[Page 602]]

    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing for the specialty of chemistry; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of chemistry; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of chemistry; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of chemistry.
    (j) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the specialty of hematology, the 
individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least one year of laboratory training or experience, or 
both, in high complexity testing for the specialty of hematology (for 
example, physicians certified either in hematology or hematology and 
medical oncology by the American Board of Internal Medicine); or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of hematology; or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of hematology; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of hematology.
    (k)(1) If the requirements of paragraph (b) of this section are not 
met and the laboratory performs tests in the subspecialty of cytology, 
the individual functioning as the technical supervisor must--
    (i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Meet one of the following requirements--
    (A) Be certified in anatomic pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (B) Be certified by the American Society of Cytology to practice 
cytopathology or possess qualifications that are equivalent to those 
required for such certification;
    (2) An individual qualified under Sec.  493.1449(b) or paragraph 
(k)(1) of this section may delegate some of the cytology technical 
supervisor responsibilities to an individual who is in the final year of 
full-time training leading

[[Page 603]]

to certification specified in paragraphs (b) or (k)(1)(ii)(A) of this 
section provided the technical supervisor qualified under Sec.  
493.1449(b) or paragraph (k)(1) of this section remains ultimately 
responsible for ensuring that all of the responsibilities of the 
cytology technical supervisor are met.
    (l) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of histopathology, 
the individual functioning as the technical supervisor must--
    (1) Meet one of the following requirements:
    (i) (A) Be a doctor of medicine or a doctor of osteopathy licensed 
to practice medicine or osteopathy in the State in which the laboratory 
is located; and
    (B) Be certified in anatomic pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification;
    (ii) An individual qualified under Sec.  493.1449(b) or paragraph 
(l)(1) of this section may delegate to an individual who is a resident 
in a training program leading to certification specified in paragraph 
(b) or (l)(1)(i)(B) of this section, the responsibility for examination 
and interpretation of histopathology specimens.
    (2) For tests in dermatopathology, meet one of the following 
requirements:
    (i) (A) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located and--
    (B) Meet one of the following requirements:
    (1) Be certified in anatomic pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2) Be certified in dermatopathology by the American Board of 
Dermatology and the American Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (3) Be certified in dermatology by the American Board of Dermatology 
or possess qualifications that are equivalent to those required for such 
certification; or
    (ii) An individual qualified under Sec.  493.1449(b) or paragraph 
(l)(2)(i) of this section may delegate to an individual who is a 
resident in a training program leading to certification specified in 
paragraphs (b) or (l)(2)(i)(B) of this section, the responsibility for 
examination and interpretation of dermatopathology specimens.
    (3) For tests in ophthalmic pathology, meet one of the following 
requirements:
    (i)(A) Be a doctor of medicine or doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located and--
    (B) Must meet one of the following requirements:
    (1) Be certified in anatomic pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2) Be certified by the American Board of Ophthalmology or possess 
qualifications that are equivalent to those required for such 
certitication and have successfully completed at least 1 year of formal 
post-residency fellowship training in ophthalmic pathology; or
    (ii) An individual qualified under Sec.  493.1449(b) or paragraph 
(1)(3)(i) of this section may delegate to an individual who is a 
resident in a training program leading to certification specified in 
paragraphs (b) or (1)(3)(i)(B) of this section, the responsibility for 
examination and interpretation of ophthalmic specimens; or
    (m) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the subspecialty of oral pathology, 
the individual functioning as the technical supervisor must meet one of 
the following requirements:
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located and--
    (ii) Be certified in anatomic pathology by the American Board of 
Pathology or the American Osteopathic Board

[[Page 604]]

of Pathology or possess qualifications that are equivalent to those 
required for such certification; or
    (2) Be certified in oral pathology by the American Board of Oral 
Pathology or possess qualifications for such certification; or
    (3) An individual qualified under Sec.  493.1449(b) or paragraph (m) 
(1) or (2) of this section may delegate to an individual who is a 
resident in a training program leading to certification specified in 
paragraphs (b) or (m) (1) or (2) of this section, the responsibility for 
examination and interpretation of oral pathology specimens.
    (n) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the specialty of radiobioassay, the 
individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing for the specialty of radiobioassay; or
    (3)(i) Have an earned doctoral degree in a chemical, physical, 
biological or clinical laboratory science from an accredited 
institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing within the specialty of radiobioassay; 
or
    (4)(i) Have earned a master's degree in a chemical, physical, 
biological or clinical laboratory science or medical technology from an 
accredited institution; and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of radiobioassay; or
    (5)(i) Have earned a bachelor's degree in a chemical, physical or 
biological science or medical technology from an accredited institution; 
and
    (ii) Have at least 4 years of laboratory training or experience, or 
both, in high complexity testing for the specialty of radiobioassay.
    (o) If the laboratory performs tests in the specialty of 
histocompatibility, the individual functioning as the technical 
supervisor must either--
    (1)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have training or experience that meets one of the following 
requirements:
    (A) Have 4 years of laboratory training or experience, or both, 
within the specialty of histocompatibility; or
    (B)(1) Have 2 years of laboratory training or experience, or both, 
in the specialty of general immunology; and
    (2) Have 2 years of laboratory training or experience, or both, in 
the specialty of histocompatibility; or
    (2)(i) Have an earned doctoral degree in a biological or clinical 
laboratory science from an accredited institution; and
    (ii) Have training or experience that meets one of the following 
requirements:
    (A) Have 4 years of laboratory training or experience, or both, 
within the specialty of histocompatibility; or
    (B)(1) Have 2 years of laboratory training or experience, or both, 
in the specialty of general immunology; and
    (2) Have 2 years of laboratory training or experience, or both, in 
the specialty of histocompatibility.
    (p) If the laboratory performs tests in the specialty of clinical 
cytogenetics, the individual functioning as the technical supervisor 
must--
    (1)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have 4 years of training or experience, or both, in genetics, 2 
of which have been in clinical cytogenetics; or

[[Page 605]]

    (2)(i) Hold an earned doctoral degree in a biological science, 
including biochemistry, or clinical laboratory science from an 
accredited institution; and
    (ii) Have 4 years of training or experience, or both, in genetics, 2 
of which have been in clinical cytogenetics.
    (q) If the requirements of paragraph (b) of this section are not met 
and the laboratory performs tests in the specialty of immunohematology, 
the individual functioning as the technical supervisor must--
    (1)(i) Be a doctor of medicine or a doctor of osteopathy licensed to 
practice medicine or osteopathy in the State in which the laboratory is 
located; and
    (ii) Be certified in clinical pathology by the American Board of 
Pathology or the American Osteopathic Board of Pathology or possess 
qualifications that are equivalent to those required for such 
certification; or
    (2)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located; and
    (ii) Have at least one year of laboratory training or experience, or 
both, in high complexity testing for the specialty of immunohematology.

    Note: The technical supervisor requirements for ``laboratory 
training or experience, or both'' in each specialty or subspecialty may 
be acquired concurrently in more than one of the specialties or 
subspecialties of service. For example, an individual, who has a 
doctoral degree in chemistry and additionally has documentation of 1 
year of laboratory experience working concurrently in high complexity 
testing in the specialties of microbiology and chemistry and 6 months of 
that work experience included high complexity testing in bacteriology, 
mycology, and mycobacteriology, would qualify as the technical 
supervisor for the specialty of chemistry and the subspecialties of 
bacteriology, mycology, and mycobacteriology.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5234, Jan. 19, 1993]



Sec.  493.1451  Standard: Technical supervisor responsibilities.

    The technical supervisor is responsible for the technical and 
scientific oversight of the laboratory. The technical supervisor is not 
required to be on site at all times testing is performed; however, he or 
she must be available to the laboratory on an as needed basis to provide 
supervision as specified in (a) of this section.
    (a) The technical supervisor must be accessible to the laboratory to 
provide on-site, telephone, or electronic consultation; and
    (b) The technical supervisor is responsible for--
    (1) Selection of the test methodology that is appropriate for the 
clinical use of the test results;
    (2) Verification of the test procedures performed and establishment 
of the laboratory's test performance characteristics, including the 
precision and accuracy of each test and test system;
    (3) Enrollment and participation in an HHS approved proficiency 
testing program commensurate with the services offered;
    (4) Establishing a quality control program appropriate for the 
testing performed and establishing the parameters for acceptable levels 
of analytic performance and ensuring that these levels are maintained 
throughout the entire testing process from the initial receipt of the 
specimen, through sample analysis and reporting of test results;
    (5) Resolving technical problems and ensuring that remedial actions 
are taken whenever test systems deviate from the laboratory's 
established performance specifications;
    (6) Ensuring that patient test results are not reported until all 
corrective actions have been taken and the test system is functioning 
properly;
    (7) Identifying training needs and assuring that each individual 
performing tests receives regular in-service training and education 
appropriate for the type and complexity of the laboratory services 
performed;
    (8) Evaluating the competency of all testing personnel and assuring 
that the staff maintain their competency to perform test procedures and 
report test results promptly, accurately and proficiently. The 
procedures for evaluation of the competency of the staff must include, 
but are not limited to--

[[Page 606]]

    (i) Direct observations of routine patient test performance, 
including patient preparation, if applicable, specimen handling, 
processing and testing;
    (ii) Monitoring the recording and reporting of test results;
    (iii) Review of intermediate test results or worksheets, quality 
control records, proficiency testing results, and preventive maintenance 
records;
    (iv) Direct observation of performance of instrument maintenance and 
function checks;
    (v) Assessment of test performance through testing previously 
analyzed specimens, internal blind testing samples or external 
proficiency testing samples; and
    (vi) Assessment of problem solving skills; and
    (9) Evaluating and documenting the performance of individuals 
responsible for high complexity testing at least semiannually during the 
first year the individual tests patient specimens. Thereafter, 
evaluations must be performed at least annually unless test methodology 
or instrumentation changes, in which case, prior to reporting patient 
test results, the individual's performance must be reevaluated to 
include the use of the new test methodology or instrumentation.
    (c) In cytology, the technical supervisor or the individual 
qualified under Sec.  493.1449(k)(2)--
    (1) May perform the duties of the cytology general supervisor and 
the cytotechnologist, as specified in Sec. Sec.  493.1471 and 493.1485, 
respectively;
    (2) Must establish the workload limit for each individual examining 
slides;
    (3) Must reassess the workload limit for each individual examining 
slides at least every 6 months and adjust as necessary;
    (4) Must perform the functions specified in Sec.  493.1274(d) and 
(e);
    (5) Must ensure that each individual examining gynecologic 
preparations participates in an HHS approved cytology proficiency 
testing program, as specified in Sec.  493.945 and achieves a passing 
score, as specified in Sec.  493.855; and
    (6) If responsible for screening cytology slide preparations, must 
document the number of cytology slides screened in 24 hours and the 
number of hours devoted during each 24-hour period to screening cytology 
slides.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5235, Jan. 19, 1993; 68 
FR 3714, Jan. 24, 2003]



Sec.  493.1453  Condition: Laboratories performing high complexity testing; clinical consultant.

    The laboratory must have a clinical consultant who meets the 
requirements of Sec.  493.1455 of this subpart and provides clinical 
consultation in accordance with Sec.  493.1457 of this subpart.



Sec.  493.1455  Standard; Clinical consultant qualifications.

    The clinical consultant must be qualified to consult with and render 
opinions to the laboratory's clients concerning the diagnosis, treatment 
and management of patient care. The clinical consultant must--
    (a) Be qualified as a laboratory director under Sec.  
493.1443(b)(1), (2), or (3)(i) or, for the subspecialty of oral 
pathology, Sec.  493.1443(b)(6); or
    (b) Be a doctor of medicine, doctor of osteopathy, doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5235, Jan. 19, 1993]



Sec.  493.1457  Standard; Clinical consultant responsibilities.

    The clinical consultant provides consultation regarding the 
appropriateness of the testing ordered and interpretation of test 
results. The clinical consultant must--
    (a) Be available to provide consultation to the laboratory's 
clients;
    (b) Be available to assist the laboratory's clients in ensuring that 
appropriate tests are ordered to meet the clinical expectations;
    (c) Ensure that reports of test results include pertinent 
information required for specific patient interpretation; and
    (d) Ensure that consultation is available and communicated to the 
laboratory's clients on matters related to the quality of the test 
results reported and their interpretation concerning specific patient 
conditions.

[[Page 607]]



Sec.  493.1459  Condition: Laboratories performing high complexity testing; general supervisor.

    The laboratory must have one or more general supervisors who are 
qualified under Sec.  493.1461 of this subpart to provide general 
supervision in accordance with Sec.  493.1463 of this subpart.



Sec.  493.1461  Standard: General supervisor qualifications.

    The laboratory must have one or more general supervisors who, under 
the direction of the laboratory director and supervision of the 
technical supervisor, provides day-to-day supervision of testing 
personnel and reporting of test results. In the absence of the director 
and technical supervisor, the general supervisor must be responsible for 
the proper performance of all laboratory procedures and reporting of 
test results.
    (a) The general supervisor must possess a current license issued by 
the State in which the laboratory is located, if such licensing is 
required; and
    (b) The general supervisor must be qualified as a--
    (1) Laboratory director under Sec.  493.1443; or
    (2) Technical supervisor under Sec.  493.1449.
    (c) If the requirements of paragraph (b)(1) or paragraph (b)(2) of 
this section are not met, the individual functioning as the general 
supervisor must--
    (1)(i) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located or have earned 
a doctoral, master's, or bachelor's degree in a chemical, physical, 
biological or clinical laboratory science, or medical technology from an 
accredited institution; and
    (ii) Have at least 1 year of laboratory training or experience, or 
both, in high complexity testing; or
    (2)(i) Qualify as testing personnel under Sec.  493.1489(b)(2); and
    (ii) Have at least 2 years of laboratory training or experience, or 
both, in high complexity testing; or
    (3)(i) Except as specified in paragraph (3)(ii) of this section, 
have previously qualified as a general supervisor under Sec.  493.1462 
on or before February 28, 1992.
    (ii) Exception. An individual who achieved a satisfactory grade in a 
proficiency examination for technologist given by HHS between March 1, 
1986 and December 31, 1987, qualifies as a general supervisor if he or 
she meets the requirements of Sec.  493.1462 on or before January 1, 
1994.''
    (4) On or before September 1, 1992, have served as a general 
supervisor of high complexity testing and as of April 24, 1995--
    (i) Meet one of the following requirements:
    (A) Have graduated from a medical laboratory or clinical laboratory 
training program approved or accredited by the Accrediting Bureau of 
Health Education Schools (ABHES), the Commission on Allied Health 
Education Accreditation (CAHEA), or other organization approved by HHS.
    (B) Be a high school graduate or equivalent and have successfully 
completed an official U.S. military medical laboratory procedures course 
of at least 50 weeks duration and have held the military enlisted 
occupational specialty of Medical Laboratory Specialist (Laboratory 
Technician).
    (ii) Have at least 2 years of clinical laboratory training, or 
experience, or both, in high complexity testing; or
    (5) On or before September 1, 1992, have served as a general 
supervisor of high complexity testing and--
    (i) Be a high school graduate or equivalent; and
    (ii) Have had at least 10 years of laboratory training or 
experience, or both, in high complexity testing, including at least 6 
years of supervisory experience between September 1, 1982 and September 
1, 1992.
    (d) For blood gas analysis, the individual providing general 
supervision must--
    (1) Be qualified under Sec. Sec.  493.1461(b) (1) or (2), or 
493.1461(c); or
    (2)(i) Have earned a bachelor's degree in respiratory therapy or 
cardiovascular technology from an accredited institution; and
    (ii) Have at least one year of laboratory training or experience, or 
both, in blood gas analysis; or
    (3)(i) Have earned an associate degree related to pulmonary function 
from an accredited institution; and

[[Page 608]]

    (ii) Have at least two years of training or experience, or both in 
blood gas analysis.
    (e) The general supervisor requirement is met in histopathology, 
oral pathology, dermatopathology, and ophthalmic pathology because all 
tests and examinations, must be performed:
    (1) In histopathology, by an individual who is qualified as a 
technical supervisor under Sec. Sec.  493.1449(b) or 493.1449(l)(1);
    (2) In dermatopathology, by an individual who is qualified as a 
technical supervisor under Sec. Sec.  493.1449(b) or 493.1449(l) or (2);
    (3) In ophthalmic pathology, by an individual who is qualified as a 
technical supervisor under Sec. Sec.  493.1449(b) or 493.1449(1)(3); and
    (4) In oral pathology, by an individual who is qualified as a 
technical supervisor under Sec. Sec.  493.1449(b) or 493.1449(m).

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5235, Jan. 19, 1993; 58 
FR 39155, July 22, 1993; 60 FR 20049, Apr. 24, 1995]



Sec.  493.1462  General supervisor qualifications on or before February 28, 1992.

    To qualify as a general supervisor under Sec.  493.1461(c)(3), an 
individual must have met or could have met the following qualifications 
as they were in effect on or before February 28, 1992.
    (a) Each supervisor possesses a current license as a laboratory 
supervisor issued by the State, if such licensing exists; and
    (b) The laboratory supervisor--
    (1) Who qualifies as a laboratory director under Sec.  
493.1406(b)(1), (2), (4), or (5) is also qualified as a general 
supervisor; therefore, depending upon the size and functions of the 
laboratory, the laboratory director may also serve as the laboratory 
supervisor; or
    (2)(i) Is a physician or has earned a doctoral degree from an 
accredited institution with a major in one of the chemical, physical, or 
biological sciences; and
    (ii) Subsequent to graduation, has had at least 2 years of 
experience in one of the laboratory specialties in a laboratory; or
    (3)(i) Holds a master's degree from an accredited institution with a 
major in one of the chemical, physical, or biological sciences; and
    (ii) Subsequent to graduation has had at least 4 years of pertinent 
full-time laboratory experience of which not less than 2 years have been 
spent working in the designated specialty in a laboratory; or
    (4)(i) Is qualified as a laboratory technologist under Sec.  
493.1491; and
    (ii) After qualifying as a laboratory technologist, has had at least 
6 years of pertinent full-time laboratory experience of which not less 
than 2 years have been spent working in the designated laboratory 
specialty in a laboratory; or
    (5) With respect to individuals first qualifying before July 1, 
1971, has had at least 15 years of pertinent full-time laboratory 
experience before January 1, 1968; this required experience may be met 
by the substitution of education for experience.

[58 FR 39155, July 22, 1993]



Sec.  493.1463  Standard: General supervisor responsibilities.

    The general supervisor is responsible for day-to-day supervision or 
oversight of the laboratory operation and personnel performing testing 
and reporting test results.
    (a) The general supervisor--(1) Must be accessible to testing 
personnel at all times testing is performed to provide on-site, 
telephone or electronic consultation to resolve technical problems in 
accordance with policies and procedures established either by the 
laboratory director or technical supervisor;
    (2) Is responsible for providing day-to-day supervision of high 
complexity test performance by a testing personnel qualified under Sec.  
493.1489;
    (3) Except as specified in paragraph (c) of this section, must be 
onsite to provide direct supervision when high complexity testing is 
performed by any individuals qualified under Sec.  493.1489(b)(5); and
    (4) Is responsible for monitoring test analyses and specimen 
examinations to ensure that acceptable levels of analytic performance 
are maintained.
    (b) The director or technical supervisor may delegate to the general 
supervisor the responsibility for--

[[Page 609]]

    (1) Assuring that all remedial actions are taken whenever test 
systems deviate from the laboratory's established performance 
specifications;
    (2) Ensuring that patient test results are not reported until all 
corrective actions have been taken and the test system is properly 
functioning;
    (3) Providing orientation to all testing personnel; and
    (4) Annually evaluating and documenting the performance of all 
testing personnel.
    (c) Exception. For individuals qualified under Sec.  493.1489(b)(5), 
who were performing high complexity testing on or before January 19, 
1993, the requirements of paragraph (a)(3) of this section are not 
effective, provided that all high complexity testing performed by the 
individual in the absence of a general supervisor is reviewed within 24 
hours by a general supervisor qualified under Sec.  493.1461.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5235, Jan. 19, 1993; 60 
FR 20050, Apr. 24, 1995]



Sec.  493.1467  Condition: Laboratories performing high complexity testing; cytology general supervisor.

    For the subspecialty of cytology, the laboratory must have a general 
supervisor who meets the qualification requirements of Sec.  493.1469 of 
this subpart, and provides supervision in accordance with Sec.  493.1471 
of this subpart.



Sec.  493.1469  Standard: Cytology general supervisor qualifications.

    The cytology general supervisor must be qualified to supervise 
cytology services. The general supervisor in cytology must possess a 
current license issued by the State in which the laboratory is located, 
if such licensing is required, and must--
    (a) Be qualified as a technical supervisor under Sec.  493.1449 (b) 
or (k); or
    (b)(1) Be qualified as a cytotechnologist under Sec.  493.1483; and
    (2) Have at least 3 years of full-time (2,080 hours per year) 
experience as a cytotechnologist within the preceding 10 years.



Sec.  493.1471  Standard: Cytology general supervisor responsibilities.

    The technical supervisor of cytology may perform the duties of the 
cytology general supervisor or delegate the responsibilities to an 
individual qualified under Sec.  493.1469.
    (a) The cytology general supervisor is responsible for the day-to-
day supervision or oversight of the laboratory operation and personnel 
performing testing and reporting test results.
    (b) The cytology general supervisor must--
    (1) Be accessible to provide on-site, telephone, or electronic 
consultation to resolve technical problems in accordance with policies 
and procedures established by the technical supervisor of cytology;
    (2) Document the slide interpretation results of each gynecologic 
and nongynecologic cytology case he or she examined or reviewed (as 
specified under Sec.  493.1274(c));
    (3) For each 24-hour period, document the total number of slides he 
or she examined or reviewed in the laboratory as well as the total 
number of slides examined or reviewed in any other laboratory or for any 
other employer; and
    (4) Document the number of hours spent examining slides in each 24-
hour period.

[57 FR 7172, Feb. 28, 1992, as amended at 68 FR 3714, Jan. 24, 2003]



Sec.  493.1481  Condition: Laboratories performing high complexity testing; cytotechnologist.

    For the subspecialty of cytology, the laboratory must have a 
sufficient number of cytotechnologists who meet the qualifications 
specified in Sec.  493.1483 to perform the functions specified in Sec.  
493.1485.



Sec.  493.1483  Standard: Cytotechnologist qualifications.

    Each person examining cytology slide preparations must meet the 
qualifications of Sec.  493.1449 (b) or (k), or--
    (a) Possess a current license as a cytotechnologist issued by the 
State in which the laboratory is located, if such licensing is required; 
and
    (b) Meet one of the following requirements:

[[Page 610]]

    (1) Have graduated from a school of cytotechnology accredited by the 
Committee on Allied Health Education and Accreditation or other 
organization approved by HHS; or
    (2) Be certified in cytotechnology by a certifying agency approved 
by HHS; or
    (3) Before September 1, 1992--
    (i) Have successfully completed 2 years in an accredited institution 
with at least 12 semester hours in science, 8 hours of which are in 
biology; and
    (A) Have had 12 months of training in a school of cytotechnology 
accredited by an accrediting agency approved by HHS; or
    (B) Have received 6 months of formal training in a school of 
cytotechnology accredited by an accrediting agency approved by HHS and 6 
months of full-time experience in cytotechnology in a laboratory 
acceptable to the pathologist who directed the formal 6 months of 
training; or
    (ii) Have achieved a satisfactory grade to qualify as a 
cytotechnologist in a proficiency examination approved by HHS and 
designed to qualify persons as cytotechnologists; or
    (4) Before September 1, 1994, have full-time experience of at least 
2 years or equivalent within the preceding 5 years examining slide 
preparations under the supervision of a physician qualified under Sec.  
493.1449(b) or (k)(1), and before January 1, 1969, must have--
    (i) Graduated from high school;
    (ii) Completed 6 months of training in cytotechnology in a 
laboratory directed by a pathologist or other physician providing 
cytology services; and
    (iii) Completed 2 years of full-time supervised experience in 
cytotechnology; or
    (5)(i) On or before September 1, 1994, have full-time experience of 
at least 2 years or equivalent examining cytology slide preparations 
within the preceding 5 years in the United States under the supervision 
of a physician qualified under Sec.  493.1449(b) or (k)(1); and
    (ii) On or before September 1, 1995, have met the requirements in 
either paragraph (b)(1) or (2) of this section.

[57 FR 7172, Feb. 28, 1992, as amended at 59 FR 685, Jan. 6, 1994]



Sec.  493.1485  Standard; Cytotechnologist responsibilities.

    The cytotechnologist is responsible for documenting--
    (a) The slide interpretation results of each gynecologic and 
nongynecologic cytology case he or she examined or reviewed (as 
specified in Sec.  493.1274(c));
    (b) For each 24-hour period, the total number of slides examined or 
reviewed in the laboratory as well as the total number of slides 
examined or reviewed in any other laboratory or for any other employer; 
and
    (c) The number of hours spent examining slides in each 24-hour 
period.

[57 FR 7172, Feb. 28, 1992, as amended at 68 FR 3714, Jan. 24, 2003]



Sec.  493.1487  Condition: Laboratories performing high complexity testing; testing personnel.

    The laboratory has a sufficient number of individuals who meet the 
qualification requirements of Sec.  493.1489 of this subpart to perform 
the functions specified in Sec.  493.1495 of this subpart for the volume 
and complexity of testing performed.



Sec.  493.1489  Standard; Testing personnel qualifications.

    Each individual performing high complexity testing must--
    (a) Possess a current license issued by the State in which the 
laboratory is located, if such licensing is required; and
    (b) Meet one of the following requirements:
    (1) Be a doctor of medicine, doctor of osteopathy, or doctor of 
podiatric medicine licensed to practice medicine, osteopathy, or 
podiatry in the State in which the laboratory is located or have earned 
a doctoral, master's or bachelor's degree in a chemical, physical, 
biological or clinical laboratory science, or medical technology from an 
accredited institution;
    (2)(i) Have earned an associate degree in a laboratory science, or 
medical laboratory technology from an accredited institution or--
    (ii) Have education and training equivalent to that specified in 
paragraph (b)(2)(i) of this section that includes--

[[Page 611]]

    (A) At least 60 semester hours, or equivalent, from an accredited 
institution that, at a minimum, include either--
    (1) 24 semester hours of medical laboratory technology courses; or
    (2) 24 semester hours of science courses that include--
    (i) Six semester hours of chemistry;
    (ii) Six semester hours of biology; and
    (iii) Twelve semester hours of chemistry, biology, or medical 
laboratory technology in any combination; and
    (B) Have laboratory training that includes either of the following:
    (1) Completion of a clinical laboratory training program approved or 
accredited by the ABHES, the CAHEA, or other organization approved by 
HHS. (This training may be included in the 60 semester hours listed in 
paragraph (b)(2)(ii)(A) of this section.)
    (2) At least 3 months documented laboratory training in each 
specialty in which the individual performs high complexity testing.
    (3) Have previously qualified or could have qualified as a 
technologist under Sec.  493.1491 on or before February 28, 1992;
    (4) On or before April 24, 1995 be a high school graduate or 
equivalent and have either--
    (i) Graduated from a medical laboratory or clinical laboratory 
training program approved or accredited by ABHES, CAHEA, or other 
organization approved by HHS; or
    (ii) Successfully completed an official U.S. military medical 
laboratory procedures training course of at least 50 weeks duration and 
have held the military enlisted occupational specialty of Medical 
Laboratory Specialist (Laboratory Technician);
    (5)(i) Until September 1, 1997--
    (A) Have earned a high school diploma or equivalent; and
    (B) Have documentation of training appropriate for the testing 
performed before analyzing patient specimens. Such training must ensure 
that the individual has--
    (1) The skills required for proper specimen collection, including 
patient preparation, if applicable, labeling, handling, preservation or 
fixation, processing or preparation, transportation and storage of 
specimens;
    (2) The skills required for implementing all standard laboratory 
procedures;
    (3) The skills required for performing each test method and for 
proper instrument use;
    (4) The skills required for performing preventive maintenance, 
troubleshooting, and calibration procedures related to each test 
performed;
    (5) A working knowledge of reagent stability and storage;
    (6) The skills required to implement the quality control policies 
and procedures of the laboratory;
    (7) An awareness of the factors that influence test results; and
    (8) The skills required to assess and verify the validity of patient 
test results through the evaluation of quality control values before 
reporting patient test results; and
    (ii) As of September 1, 1997, be qualified under Sec.  
493.1489(b)(1), (b)(2), or (b)(4), except for those individuals 
qualified under paragraph (b)(5)(i) of this section who were performing 
high complexity testing on or before April 24, 1995;
    (6) For blood gas analysis--
    (i) Be qualified under Sec.  493.1489(b)(1), (b)(2), (b)(3), (b)(4), 
or (b)(5);
    (ii) Have earned a bachelor's degree in respiratory therapy or 
cardiovascular technology from an accredited institution; or
    (iii) Have earned an associate degree related to pulmonary function 
from an accredited institution; or
    (7) For histopathology, meet the qualifications of Sec.  493.1449 
(b) or (l) to perform tissue examinations.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5236, Jan. 19, 1993; 58 
FR 39155, July 22, 1993; 60 FR 20050, Apr. 24, 1995]



Sec.  493.1491  Technologist qualifications on or before February 28, 1992.

    In order to qualify as high complexity testing personnel under Sec.  
493.1489(b)(3), the individual must have met or could have met the 
following qualifications for technologist as they were in effect on or 
before February 28, 1992. Each technologist must--
    (a) Possess a current license as a laboratory technologist issued by 
the State, if such licensing exists; and

[[Page 612]]

    (b)(1) Have earned a bachelor's degree in medical technology from an 
accredited university; or
    (2) Have successfully completed 3 years of academic study (a minimum 
of 90 semester hours or equivalent) in an accredited college or 
university, which met the specific requirements for entrance into a 
school of medical technology accredited by an accrediting agency 
approved by the Secretary, and has successfully completed a course of 
training of at least 12 months in such a school; or
    (3) Have earned a bachelor's degree in one of the chemical, 
physical, or biological sciences and, in addition, has at least 1 year 
of pertinent full-time laboratory experience or training, or both, in 
the specialty or subspecialty in which the individual performs tests; or
    (4)(i) Have successfully completed 3 years (90 semester hours or 
equivalent) in an accredited college or university with the following 
distribution of courses--
    (A) For those whose training was completed before September 15, 
1963. At least 24 semester hours in chemistry and biology courses of 
which--
    (1) At least 6 semester hours were in inorganic chemistry and at 
least 3 semester hours were in other chemistry courses; and
    (2) At least 12 semester hours in biology courses pertinent to the 
medical sciences; or
    (B) For those whose training was completed after September 14, 1963.
    (1) 16 semester hours in chemistry courses that included at least 6 
semester hours in inorganic chemistry and that are acceptable toward a 
major in chemistry;
    (2) 16 semester hours in biology courses that are pertinent to the 
medical sciences and are acceptable toward a major in the biological 
sciences; and
    (3) 3 semester hours of mathematics; and
    (ii) Has experience, training, or both, covering several fields of 
medical laboratory work of at least 1 year and of such quality as to 
provide him or her with education and training in medical technology 
equivalent to that described in paragraphs (b)(1) and (2) of this 
section; or
    (5) With respect to individuals first qualifying before July 1, 
1971, the technologist--
    (i) Was performing the duties of a laboratory technologist at any 
time between July 1, 1961, and January 1, 1968, and
    (ii) Has had at least 10 years of pertinent laboratory experience 
prior to January 1, 1968. (This required experience may be met by the 
substitution of education for experience); or
    (6) Achieves a satisfactory grade in a proficiency examination 
approved by HHS.

[58 FR 39155, July 22, 1993]



Sec.  493.1495  Standard; Testing personnel responsibilities.

    The testing personnel are responsible for specimen processing, test 
performance and for reporting test results.
    (a) Each individual performs only those high complexity tests that 
are authorized by the laboratory director and require a degree of skill 
commensurate with the individual's education, training or experience, 
and technical abilities.
    (b) Each individual performing high complexity testing must--
    (1) Follow the laboratory's procedures for specimen handling and 
processing, test analyses, reporting and maintaining records of patient 
test results;
    (2) Maintain records that demonstrate that proficiency testing 
samples are tested in the same manner as patient specimens;
    (3) Adhere to the laboratory's quality control policies, document 
all quality control activities, instrument and procedural calibrations 
and maintenance performed;
    (4) Follow the laboratory's established policies and procedures 
whenever test systems are not within the laboratory's established 
acceptable levels of performance;
    (5) Be capable of identifying problems that may adversely affect 
test performance or reporting of test results and either must correct 
the problems or immediately notify the general supervisor, technical 
supervisor, clinical consultant, or director;
    (6) Document all corrective actions taken when test systems deviate 
from

[[Page 613]]

the laboratory's established performance specifications; and
    (7) Except as specified in paragraph (c) of this section, if 
qualified under Sec.  493.1489(b)(5), perform high complexity testing 
only under the onsite, direct supervision of a general supervisor 
qualified under Sec.  493.1461.
    (c) Exception. For individuals qualified under Sec.  493.1489(b)(5), 
who were performing high complexity testing on or before January 19, 
1993, the requirements of paragraph (b)(7) of this section are not 
effective, provided that all high complexity testing performed by the 
individual in the absence of a general supervisor is reviewed within 24 
hours by a general supervisor qualified under Sec.  493.1461.

[57 FR 7172, Feb. 28, 1992, as amended at 58 FR 5236, Jan. 19, 1993; 60 
FR 20050, Apr. 24, 1995]

Subparts N-P [Reserved]



                          Subpart Q_Inspection

    Source: 57 FR 7184, Feb. 28, 1992, unless otherwise noted.



Sec.  493.1771  Condition: Inspection requirements applicable to all CLIA-certified and CLIA-exempt laboratories.

    (a) Each laboratory issued a CLIA certificate must meet the 
requirements in Sec.  493.1773 and the specific requirements for its 
certificate type, as specified in Sec. Sec.  493.1775 through 493.1780.
    (b) All CLIA-exempt laboratories must comply with the inspection 
requirements in Sec. Sec.  493.1773 and 493.1780, when applicable.

[63 FR 26737, May 14, 1998]



Sec.  493.1773  Standard: Basic inspection requirements for all laboratories issued a CLIA certificate and CLIA-exempt laboratories.

    (a) A laboratory issued a certificate must permit CMS or a CMS agent 
to conduct an inspection to assess the laboratory's compliance with the 
requirements of this part. A CLIA-exempt laboratory and a laboratory 
that requests, or is issued a certificate of accreditation, must permit 
CMS or a CMS agent to conduct validation and complaint inspections.
    (b) General requirements. As part of the inspection process, CMS or 
a CMS agent may require the laboratory to do the following:
    (1) Test samples, including proficiency testing samples, or perform 
procedures.
    (2) Permit interviews of all personnel concerning the laboratory's 
compliance with the applicable requirements of this part.
    (3) Permit laboratory personnel to be observed performing all phases 
of the total testing process (preanalytic, analytic, and postanalytic).
    (4) Permit CMS or a CMS agent access to all areas encompassed under 
the certificate including, but not limited to, the following:
    (i) Specimen procurement and processing areas.
    (ii) Storage facilities for specimens, reagents, supplies, records, 
and reports.
    (iii) Testing and reporting areas.
    (5) Provide CMS or a CMS agent with copies or exact duplicates of 
all records and data it requires.
    (c) Accessible records and data. A laboratory must have all records 
and data accessible and retrievable within a reasonable time frame 
during the course of the inspection.
    (d) Requirement to provide information and data. A laboratory must 
provide, upon request, all information and data needed by CMS or a CMS 
agent to make a determination of the laboratory's compliance with the 
applicable requirements of this part.
    (e) Reinspection. CMS or a CMS agent may reinspect a laboratory at 
any time to evaluate the ability of the laboratory to provide accurate 
and reliable test results.
    (f) Complaint inspection. CMS or a CMS agent may conduct an 
inspection when there are complaints alleging noncompliance with any of 
the requirements of this part.
    (g) Failure to permit an inspection or reinspection. Failure to 
permit CMS or a CMS agent to conduct an inspection or reinspection 
results in the suspension or cancellation of the laboratory's 
participation in Medicare and Medicaid

[[Page 614]]

for payment, and suspension or limitation of, or action to revoke the 
laboratory's CLIA certificate, in accordance with subpart R of this 
part.

[63 FR 26737, May 14, 1998; 63 FR 32699, June 15, 1998]



Sec.  493.1775  Standard: Inspection of laboratories issued a certificate of waiver or a certificate for provider-performed microscopy procedures.

    (a) A laboratory that has been issued a certificate of waiver or a 
certificate for provider-performed microscopy procedures is not subject 
to biennial inspections.
    (b) If necessary, CMS or a CMS agent may conduct an inspection of a 
laboratory issued a certificate of waiver or a certificate for provider-
performed microscopy procedures at any time during the laboratory's 
hours of operation to do the following:
    (1) Determine if the laboratory is operated and testing is performed 
in a manner that does not constitute an imminent and serious risk to 
public health.
    (2) Evaluate a complaint from the public.
    (3) Determine whether the laboratory is performing tests beyond the 
scope of the certificate held by the laboratory.
    (4) Collect information regarding the appropriateness of tests 
specified as waived tests or provider-performed microscopy procedures.
    (c) The laboratory must comply with the basic inspection 
requirements of Sec.  493.1773.

[63 FR 26737, May 14, 1998]



Sec.  493.1777  Standard: Inspection of laboratories that have requested or have been issued a certificate of compliance.

    (a) Initial inspection. (1) A laboratory issued a registration 
certificate must permit an initial inspection to assess the laboratory's 
compliance with the requirements of this part before CMS issues a 
certificate of compliance.
    (2) The inspection may occur at any time during the laboratory's 
hours of operation.
    (b) Subsequent inspections. (1) CMS or a CMS agent may conduct 
subsequent inspections on a biennial basis or with such other frequency 
as CMS determines to be necessary to ensure compliance with the 
requirements of this part.
    (2) CMS bases the nature of subsequent inspections on the 
laboratory's compliance history.
    (c) Provider-performed microscopy procedures. The inspection sample 
for review may include testing in the subcategory of provider-performed 
microscopy procedures.
    (d) Compliance with basic inspection requirements. The laboratory 
must comply with the basic inspection requirements of Sec.  493.1773.

[63 FR 26738, May 14, 1998]



Sec.  493.1780  Standard: Inspection of CLIA-exempt laboratories or laboratories requesting or issued a certificate of accreditation.

    (a) Validation inspection. CMS or a CMS agent may conduct a 
validation inspection of any accredited or CLIA-exempt laboratory at any 
time during its hours of operation.
    (b) Complaint inspection. CMS or a CMS agent may conduct a complaint 
inspection of a CLIA-exempt laboratory or a laboratory requesting or 
issued a certificate of accreditation at any time during its hours of 
operation upon receiving a complaint applicable to the requirements of 
this part.
    (c) Noncompliance determination. If a validation or complaint 
inspection results in a finding that the laboratory is not in compliance 
with one or more condition-level requirements, the following actions 
occur:
    (1) A laboratory issued a certificate of accreditation is subject to 
a full review by CMS, in accordance with subpart E of this part and 
Sec.  488.11 of this chapter.
    (2) A CLIA-exempt laboratory is subject to appropriate enforcement 
actions under the approved State licensure program.
    (d) Compliance with basic inspection requirements. CLIA-exempt 
laboratories and laboratories requesting or issued a certificate of 
accreditation must comply with the basic inspection requirements in 
Sec.  493.1773.

[63 FR 26738, May 14, 1998]

[[Page 615]]



                    Subpart R_Enforcement Procedures

    Source: 57 FR 7237, Feb. 28, 1992, unless otherwise noted.



Sec.  493.1800  Basis and scope.

    (a) Statutory basis. (1) Section 1846 of the Act--
    (i) Provides for intermediate sanctions that may be imposed on 
laboratories that perform clinical diagnostic tests on human specimens 
when those laboratories are found to be out of compliance with one or 
more of the conditions for Medicare coverage of their services; and
    (ii) Requires the Secretary to develop and implement a range of such 
sanctions, including four that are specified in the statute.
    (2) The Clinical Laboratories Improvement Act of 1967 (section 353 
of the Public Health Service Act) as amended by CLIA '88--
    (i) Establishes requirements for all laboratories that perform 
clinical diagnostic tests on human specimens;
    (ii) Requires a Federal certification scheme to be applied to all 
such laboratories; and
    (iii) Grants the Secretary broad enforcement authority, including--
    (A) Use of intermediate sanctions;
    (B) Suspension, limitation, or revocation of the certificate of a 
laboratory that is out of compliance with one or more requirements for a 
certificate; and
    (C) Civil suit to enjoin any laboratory activity that constitutes a 
significant hazard to the public health.
    (3) Section 353 also--
    (i) Provides for imprisonment or fine for any person convicted of 
intentional violation of CLIA requirements;
    (ii) Specifies the administrative hearing and judicial review rights 
of a laboratory that is sanctioned under CLIA; and
    (iii) Requires the Secretary to publish annually a list of all 
laboratories that have been sanctioned during the preceding year.
    (b) Scope and applicability. This subpart sets forth--
    (1) The policies and procedures that CMS follows to enforce the 
requirements applicable to laboratories under CLIA and under section 
1846 of the Act; and
    (2) The appeal rights of laboratories on which CMS imposes 
sanctions.



Sec.  493.1804  General considerations.

    (a) Purpose. The enforcement mechanisms set forth in this subpart 
have the following purposes:
    (1) To protect all individuals served by laboratories against 
substandard testing of specimens.
    (2) To safeguard the general public against health and safety 
hazards that might result from laboratory activities.
    (3) To motivate laboratories to comply with CLIA requirements so 
that they can provide accurate and reliable test results.
    (b) Basis for decision to impose sanctions. (1) CMS's decision to 
impose sanctions is based on one or more of the following:
    (i) Deficiencies found by CMS or its agents in the conduct of 
inspections to certify or validate compliance with Federal requirements, 
or through review of materials submitted by the laboratory (e.g., 
personnel qualifications).
    (ii) Unsuccessful participation in proficiency testing.
    (2) CMS imposes one or more of the alternative or principal 
sanctions specified in Sec. Sec.  493.1806 and 493.1807 when CMS or 
CMS's agent finds that a laboratory has condition-level deficiencies.
    (c) Imposition of alternative sanctions. (1) CMS may impose 
alternative sanctions in lieu of, or in addition to principal sanctions, 
(CMS does not impose alternative sanctions on laboratories that have 
certificates of waiver because those laboratories are not inspected for 
compliance with condition-level requirements.)
    (2) CMS may impose alternative sanctions other than a civil money 
penalty after the laboratory has had an opportunity to respond, but 
before the hearing specified in Sec.  493.1844.
    (d) Choice of sanction: Factors considered. CMS bases its choice of 
sanction or sanctions on consideration of one or more factors that 
include, but are not limited to, the following, as assessed by the State 
or by CMS, or its agents:

[[Page 616]]

    (1) Whether the deficiencies pose immediate jeopardy.
    (2) The nature, incidence, severity, and duration of the 
deficiencies or noncompliance.
    (3) Whether the same condition level deficiencies have been 
identified repeatedly.
    (4) The accuracy and extent of laboratory records (e.g., of remedial 
action) in regard to the noncompliance, and their availability to the 
State, to other CMS agents, and to CMS.
    (5) The relationship of one deficiency or group of deficiencies to 
other deficiencies.
    (6) The overall compliance history of the laboratory including but 
not limited to any period of noncompliance that occurred between 
certifications of compliance.
    (7) The corrective and long-term compliance outcomes that CMS hopes 
to achieve through application of the sanction.
    (8) Whether the laboratory has made any progress toward improvement 
following a reasonable opportunity to correct deficiencies.
    (9) Any recommendation by the State agency as to which sanction 
would be appropriate.
    (e) Number of alternative sanctions. CMS may impose a separate 
sanction for each condition level deficiency or a single sanction for 
all condition level deficiencies that are interrelated and subject to 
correction by a single course of action.
    (f) Appeal rights. The appeal rights of laboratories dissatisfied 
with the imposition of a sanction are set forth in Sec.  493.1844.

[57 FR 7237, Feb. 28, 1992; 57 FR 35761, Aug. 11, 1992, as amended at 60 
FR 20051, Apr. 24, 1995]



Sec.  493.1806  Available sanctions: All laboratories.

    (a) Applicability. CMS may impose one or more of the sanctions 
specified in this section on a laboratory that is out of compliance with 
one or more CLIA conditions.
    (b) Principal sanction. CMS may impose any of the three principal 
CLIA sanctions, which are suspension, limitation, or revocation of any 
type of CLIA certificate.
    (c) Alternative sanctions. CMS may impose one or more of the 
following alternative sanctions in lieu of or in addition to imposing a 
principal sanction, except on a laboratory that has a certificate of 
waiver.
    (1) Directed plan of correction, as set forth at Sec.  493.1832.
    (2) State onsite monitoring as set forth at Sec.  493.1836.
    (3) Civil money penalty, as set forth at Sec.  493.1834.
    (d) Civil suit. CMS may bring suit in the appropriate U.S. District 
Court to enjoin continuation of any activity of any laboratory 
(including a CLIA-exempt laboratory that has been found with 
deficiencies during a validation survey), if CMS has reason to believe 
that continuation of the activity would constitute a significant hazard 
to the public health.
    (e) Criminal sanctions. Under section 353(1) of the PHS Act, an 
individual who is convicted of intentionally violating any CLIA 
requirement may be imprisoned or fined.

[57 FR 7237, Feb. 28, 1992, as amended at 58 FR 5237, Jan. 19, 1993]



Sec.  493.1807  Additional sanctions: Laboratories that participate in Medicare.

    The following additional sanctions are available for laboratories 
that are out of compliance with one or more CLIA conditions and that 
have approval to receive Medicare payment for their services.
    (a) Principal sanction. Cancellation of the laboratory's approval to 
receive Medicare payment for its services.
    (b) Alternative sanctions. (1) Suspension of payment for tests in 
one or more specific specialties or subspecialties, performed on or 
after the effective date of sanction.
    (2) Suspension of payment for all tests in all specialties and 
subspecialties performed on or after the effective date of sanction.



Sec.  493.1808  Adverse action on any type of CLIA certificate: Effect on Medicare approval.

    (a) Suspension or revocation of any type of CLIA certificate. When 
CMS suspends or revokes any type of CLIA certificate, CMS concurrently 
cancels the

[[Page 617]]

laboratory's approval to receive Medicare payment for its services.
    (b) Limitation of any type of CLIA certificate. When CMS limits any 
type of CLIA certificate, CMS concurrently limits Medicare approval to 
only those specialties or subspecialties that are authorized by the 
laboratory's limited certificate.



Sec.  493.1809  Limitation on Medicaid payment.

    As provided in section 1902(a)(9)(C) of the Act, payment for 
laboratory services may be made under the State plan only if those 
services are furnished by a laboratory that has a CLIA certificate or is 
licensed by a State whose licensure program has been approved by the 
Secretary under this part.

[57 FR 7237, Feb. 28, 1992; 57 FR 35761, Aug. 11, 1992]



Sec.  493.1810  Imposition and lifting of alternative sanctions.

    (a) Notice of noncompliance and of proposed sanction: Content. If 
CMS or its agency identifies condition level noncompliance in a 
laboratory, CMS or its agent gives the laboratory written notice of the 
following:
    (1) The condition level noncompliance that it has identified.
    (2) The sanction or sanctions that CMS or its agent proposes to 
impose against the laboratory.
    (3) The rationale for the proposed sanction or sanctions.
    (4) The projected effective date and duration of the proposed 
sanction or sanctions.
    (5) The authority for the proposed sanction or sanctions.
    (6) The time allowed (at least 10 days) for the laboratory to 
respond to the notice.
    (b) Opportunity to respond. During the period specified in paragraph 
(a)(6) of this section, the laboratory may submit to CMS or its agent 
written evidence or other information against the imposition of the 
proposed sanction or sanctions.
    (c) Notice of imposition of sanction--(1) Content. CMS gives the 
laboratory written notice that acknowledges any evidence or information 
received from the laboratory and specifies the following:
    (i) The sanction or sanctions to be imposed against the laboratory.
    (ii) The authority and rationale for the imposing sanction or 
sanctions.
    (iii) The effective date and duration of sanction.
    (2) Timing. (i) If CMS or its agent determines that the deficiencies 
pose immediate jeopardy, CMS provides notice at least 5 days before the 
effective date of sanction.
    (ii) If CMS or its agent determines that the deficiencies do not 
pose immediate jeopardy, CMS provides notice at least 15 days before the 
effective date of the sanction.
    (d) Duration of alternative sanctions. An alternative sanction 
continues until the earlier of the following occurs:
    (1) The laboratory corrects all condition level deficiencies.
    (2) CMS's suspension, limitation, or revocation of the laboratory's 
CLIA certificate becomes effective.
    (e) Lifting of alternative sanctions--(1) General rule. Alternative 
sanctions are not lifted until a laboratory's compliance with all 
condition level requirements is verified.
    (2) Credible allegation of compliance. When a sanctioned laboratory 
submits a credible allegation of compliance, CMS's agent determines 
whether--
    (i) It can certify compliance on the basis of the evidence presented 
by the laboratory in its allegation; or
    (ii) It must revisit to verify whether the laboratory has, in fact, 
achieved compliance.
    (3) Compliance achieved before the date of revisit. If during a 
revisit, the laboratory presents credible evidence (as determined by CMS 
or its agent) that it achieved compliance before the date of revisit, 
sanctions are lifted as of that earlier date.



Sec.  493.1812  Action when deficiencies pose immediate jeopardy.

    If a laboratory's deficiencies pose immediate jeopardy, the 
following rules apply:
    (a) CMS requires the laboratory to take immediate action to remove 
the jeopardy and may impose one or more alternative sanctions to help 
bring the laboratory into compliance.

[[Page 618]]

    (b) If the findings of a revisit indicate that a laboratory has not 
eliminated the jeopardy, CMS suspends or limits the laboratory's CLIA 
certificate no earlier than 5 days after the date of notice of 
suspension or limitation. CMS may later revoke the certificate.
    (c) In addition, if CMS has reason to believe that the continuation 
of any activity by any laboratory (either the entire laboratory 
operation or any specialty or subspecialty of testing) would constitute 
a significant hazard to the public health, CMS may bring suit and seek a 
temporary injunction or restraining order against continuation of that 
activity by the laboratory, regardless of the type of CLIA certificate 
the laboratory has and of whether it is State-exempt.



Sec.  493.1814  Action when deficiencies are at the condition level but do not pose immediate jeopardy.

    If a laboratory has condition level deficiencies that do not pose 
immediate jeopardy, the following rules apply:
    (a) Initial action. (1) CMS may cancel the laboratory's approval to 
receive Medicare payment for its services.
    (2) CMS may suspend, limit, or revoke the laboratory's CLIA 
certificate.
    (3) If CMS does not impose a principal sanction under paragraph 
(a)(1) or (a)(2) of this section, it imposes one or more alternative 
sanctions. In the case of unsuccessful participation in proficiency 
testing, CMS may impose the training and technical assistance 
requirement set forth at Sec.  493.1838 in lieu of, or in addition to, 
one or more alternative sanctions.
    (b) Failure to correct condition level deficiencies. If CMS imposes 
alternative sanctions for condition level deficiencies that do not pose 
immediate jeopardy, and the laboratory does not correct the condition 
level deficiencies within 12 months after the last day of inspection, 
CMS--
    (1) Cancels the laboratory's approval to receive Medicare payment 
for its services, and discontinues the Medicare payment sanctions as of 
the day cancellation is effective.
    (2) Following a revisit which indicates that the laboratory has not 
corrected its condition level deficiencies, notifies the laboratory that 
it proposes to suspend, limit, or revoke the certificate, as specified 
in Sec.  493.1816(b), and the laboratory's right to hearing; and
    (3) May impose (or continue, if already imposed) any alternative 
sanctions that do not pertain to Medicare payments. (Sanctions imposed 
under the authority of section 353 of the PHS Act may continue for more 
than 12 months from the last date of inspection, while a hearing on the 
proposed suspension, limitation, or revocation of the certificate of 
compliance, registration certificate, certificate of accreditation, or 
certificate for PPM procedures is pending.)
    (c) Action after hearing. If a hearing decision upholds a proposed 
suspension, limitation, or revocation of a laboratory's CLIA 
certificate, CMS discontinues any alternative sanctions as of the day it 
makes the suspension, limitation, or revocation effective.

[57 FR 7237, Feb. 28, 1992, as amended at 60 FR 20051, Apr. 24, 1995]



Sec.  493.1816  Action when deficiencies are not at the condition level.

    If a laboratory has deficiencies, that are not at the condition 
level, the following rules apply:
    (a) Initial action. The laboratory must submit a plan of correction 
that is acceptable to CMS in content and time frames.
    (b) Failure to correct deficiencies. If, on revisit, it is found 
that the laboratory has not corrected the deficiencies within 12 months 
after the last day of inspection, the following rules apply:
    (1) CMS cancels the laboratory's approval to receive Medicare 
payment for its services.
    (2) CMS notifies the laboratory of its intent to suspend, limit, or 
revoke the laboratory's CLIA certificate and of the laboratory's right 
to a hearing.



Sec.  493.1820  Ensuring timely correction of deficiencies.

    (a) Timing of visits. CMS, the State survey agency or other CMS 
agent may visit the laboratory at any time to evaluate progress, and at 
the end of the period to determine whether all corrections have been 
made.
    (b) Deficiencies corrected before a visit. If during a visit, a 
laboratory produces

[[Page 619]]

credible evidence that it achieved compliance before the visit, the 
sanctions are lifted as of that earlier date.
    (c) Failure to correct deficiencies. If during a visit it is found 
that the laboratory has not corrected its deficiencies, CMS may propose 
to suspend, limit, or revoke the laboratory's CLIA certificate.
    (d) Additional time for correcting lower level deficiencies not at 
the condition level. If at the end of the plan of correction period all 
condition level deficiencies have been corrected, and there are 
deficiencies, that are not at the condition level, CMS may request a 
revised plan of correction. The revised plan may not extend beyond 12 
months from the last day of the inspection that originally identified 
the cited deficiencies.
    (e) Persistence of deficiencies. If at the end of the period covered 
by the plan of correction, the laboratory still has deficiencies, the 
rules of Sec. Sec.  493.1814 and 493.1816 apply.



Sec.  493.1826  Suspension of part of Medicare payments.

    (a) Application. (1) CMS may impose this sanction if a laboratory--
    (i) Is found to have condition level deficiencies with respect to 
one or more specialties or subspecialties of tests; and
    (ii) Agrees (in return for not having its Medicare approval 
cancelled immediately) not to charge Medicare beneficiaries or their 
private insurance carriers for the services for which Medicare payment 
is suspended.
    (2) CMS suspends Medicare payment for those specialities or 
subspecialties of tests for which the laboratory is out of compliance 
with Federal requirements.
    (b) Procedures. Before imposing this sanction, CMS provides notice 
of sanction and opportunity to respond in accordance with Sec.  
493.1810.
    (c) Duration and effect of sanction. This sanction continues until 
the laboratory corrects the condition level deficiencies or CMS cancels 
the laboratory's approval to receive Medicare payment for its services, 
but in no event longer than 12 months.
    (1) If the laboratory corrects all condition level deficiencies, CMS 
resumes Medicare payment effective for all services furnished on or 
after the date the deficiencies are corrected.
    (2) [Reserved]

[57 FR 7237, Feb. 28, 1992; 57 FR 35761, Aug. 11, 1992]



Sec.  493.1828  Suspension of all Medicare payments.

    (a) Application. (1) CMS may suspend payment for all Medicare-
approved laboratory services when the laboratory has condition level 
deficiencies.
    (2) CMS suspends payment for all Medicare covered laboratory 
services when the following conditions are met:
    (i) Either--
    (A) The laboratory has not corrected its condition level 
deficiencies included in the plan of correction within 3 months from the 
last date of inspection; or
    (B) The laboratory has been found to have the same condition level 
deficiencies during three consecutive inspections; and
    (ii) The laboratory has chosen (in return for not having its 
Medicare approval immediately cancelled), to not charge Medicare 
beneficiaries or their private insurance carriers for services for which 
Medicare payment is suspended.
    (3) CMS suspends payment for services furnished on and after the 
effective date of sanction.
    (b) Procedures. Before imposing this sanction, CMS provides notice 
of sanction and opportunity to respond in accordance with Sec.  
493.1810.
    (c) Duration and effect of sanction. (1) Suspension of payment 
continues until all condition level deficiencies are corrected, but 
never beyond twelve months.
    (2) If all the deficiencies are not corrected by the end of the 12 
month period, CMS cancels the laboratory's approval to receive Medicare 
payment for its services.



Sec.  493.1832  Directed plan of correction and directed portion of a plan of correction.

    (a) Application. CMS may impose a directed plan of correction as an 
alternative sanction for any laboratory that has condition level 
deficiencies. If CMS

[[Page 620]]

does not impose a directed plan of correction as an alternative sanction 
for a laboratory that has condition level deficiencies, it at least 
imposes a directed portion of a plan of correction when it imposes any 
of the following alternative sanctions:
    (1) State onsite monitoring.
    (2) Civil money penalty.
    (3) Suspension of all or part of Medicare payments.
    (b) Procedures--(1) Directed plan of correction. When imposing this 
sanction, CMS--
    (i) Gives the laboratory prior notice of the sanction and 
opportunity to respond in accordance with Sec.  493.1810;
    (ii) Directs the laboratory to take specific corrective action 
within specific time frames in order to achieve compliance; and
    (iii) May direct the laboratory to submit the names of laboratory 
clients for notification purposes, as specified in paragraph (b)(3) of 
this section.
    (2) Directed portion of a plan of correction. CMS may decide to 
notify clients of a sanctioned laboratory, because of the seriousness of 
the noncompliance (e.g., the existence of immediate jeopardy) or for 
other reasons. When imposing this sanction, CMS takes the following 
steps--
    (i) Directs the laboratory to submit to CMS, the State survey 
agency, or other CMS agent, within 10 calendar days after the notice of 
the alternative sanction, a list of names and addresses of all 
physicians, providers, suppliers, and other clients who have used some 
or all of the services of the laboratory since the last certification 
inspection or within any other timeframe specified by CMS.
    (ii) Within 30 calendar days of receipt of the information, may send 
to each laboratory client, via the State survey agency, a notice 
containing the name and address of the laboratory, the nature of the 
laboratory's noncompliance, and the kind and effective date of the 
alternative sanction.
    (iii) Sends to each laboratory client, via the State survey agency, 
notice of the recission of an adverse action within 30 days of the 
rescission.
    (3) Notice of imposition of a principal sanction following the 
imposition of an alternative sanction. If CMS imposes a principal 
sanction following the imposition of an alternative sanction, and for 
which CMS has already obtained a list of laboratory clients, CMS may use 
that list to notify the clients of the imposition of the principal 
sanction.
    (c) Duration of a directed plan of correction. If CMS imposes a 
directed plan of correction, and on revisit it is found that the 
laboratory has not corrected the deficiencies within 12 months from the 
last day of inspection, the following rules apply:
    (1) CMS cancels the laboratory's approval for Medicare payment of 
its services, and notifies the laboratory of CMS's intent to suspend, 
limit, or revoke the laboratory's CLIA certificate.
    (2) The directed plan of correction continues in effect until the 
day suspension, limitation, or revocation of the laboratory's CLIA 
certificate.



Sec.  493.1834  Civil money penalty.

    (a) Statutory basis. Sections 1846 of the Act and 353(h)(2)(B) of 
the PHS Act authorize the Secretary to impose civil money penalties on 
laboratories. Section 1846(b)(3) of the Act specifically provides that 
incrementally more severe fines may be imposed for repeated or 
uncorrected deficiencies.
    (b) Scope. This section sets forth the procedures that CMS follows 
to impose a civil money penalty in lieu of, or in addition to, 
suspending, limiting, or revoking the certificate of compliance, 
registration certificate, certificate of accreditation, or certificate 
for PPM procedures of a laboratory that is found to have condition level 
deficiencies.
    (c) Basis for imposing a civil money penalty. CMS may impose a civil 
money penalty against any laboratory determined to have condition level 
deficiencies regardless of whether those deficiencies pose immediate 
jeopardy.
    (d) Amount of penalty--(1) Factors considered. In determining the 
amount of the penalty, CMS takes into account the following factors:
    (i) The nature, scope, severity, and duration of the noncompliance.
    (ii) Whether the same condition level deficiencies have been 
identified during three consecutive inspections.
    (iii) The laboratory's overall compliance history including but not 
limited

[[Page 621]]

to any period of noncompliance that occurred between certifications of 
compliance.
    (iv) The laboratory's intent or reason for noncompliance.
    (v) The accuracy and extent of laboratory records and their 
availability to CMS, the State survey agency, or other CMS agent.
    (2) Range of penalty amount. (i) For a condition level deficiency 
that poses immediate jeopardy, the range is $3,050-$10,000 per day of 
noncompliance or per violation.
    (ii) For a condition level deficiency that does not pose immediate 
jeopardy, the range is $50-$3,000 per day of noncompliance or per 
violation.
    (3) Decreased penalty amounts. If the immediate jeopardy is removed, 
but the deficiency continues, CMS shifts the penalty amount to the lower 
range.
    (4) Increased penalty amounts. CMS may, before the hearing, propose 
to increase the penalty amount for a laboratory that has deficiencies 
which, after imposition of a lower level penalty amount, become 
sufficiently serious to pose immediate jeopardy.
    (e) Procedures for imposition of civil money penalty--(1) Notice of 
intent. (i) CMS sends the laboratory written notice, of CMS's intent to 
impose a civil money penalty.
    (ii) The notice includes the following information:
    (A) The statutory basis for the penalty.
    (B) The proposed daily or per violation amount of the penalty.
    (C) The factors (as described in paragraph (d)(1) of this section) 
that CMS considered.
    (D) The opportunity for responding to the notice in accordance with 
Sec.  493.1810(c).
    (E) A specific statement regarding the laboratory's appeal rights.
    (2) Appeal rights. (i) The laboratory has 60 days from the date of 
receipt of the notice of intent to impose a civil money penalty to 
request a hearing in accordance with Sec.  493.1844(g).
    (ii) If the laboratory requests a hearing, all other pertinent 
provisions of Sec.  493.1844 apply.
    (iii) If the laboratory does not request a hearing, CMS may reduce 
the proposed penalty amount by 35 percent.
    (f) Accrual and duration of penalty--(1) Accrual of penalty. The 
civil money penalty begins accruing as follows:
    (i) 5 days after notice of intent if there is immediate jeopardy.
    (ii) 15 days after notice of intent if there is not immediate 
jeopardy.
    (2) Duration of penalty. The civil money penalty continues to accrue 
until the earliest of the following occurs:
    (i) The laboratory's compliance with condition level requirements is 
verified on the basis of the evidence presented by the laboratory in its 
credible allegation of compliance or at the time or revisit.
    (ii) Based on credible evidence presented by the laboratory at the 
time of revisit, CMS determines that compliance was achieved before the 
revisit. (In this situation, the money penalty stops accruing as of the 
date of compliance.)
    (iii) CMS suspends, limits, or revokes the laboratory's certificate 
of compliance, registration certificate, certificate of accreditation, 
or certificate for PPM procedures.
    (g) Computation and notice of total penalty amount--(1) Computation. 
CMS computes the total penalty amount after the laboratory's compliance 
is verified or CMS suspends, limits, or revokes the laboratory's CLIA 
certificate but in no event before--
    (i) The 60 day period for requesting a hearing has expired without a 
request or the laboratory has explicitly waived its right to a hearing; 
or
    (ii) Following a hearing requested by the laboratory, the ALJ issues 
a decision that upholds imposition of the penalty.
    (2) Notice of penalty amount and due date of penalty. The notice 
includes the following information:
    (i) Daily or per violation penalty amount.
    (ii) Number of days or violations for which the penalty is imposed.
    (iii) Total penalty amount.
    (iv) Due date for payment of the penalty.
    (h) Due date for payment of penalty. (1) Payment of a civil money 
penalty is due 15 days from the date of the notice specified in 
paragraph (g)(2) of this section.

[[Page 622]]

    (2) CMS may approve a plan for a laboratory to pay a civil money 
penalty, plus interest, over a period of up to one year from the 
original due date.
    (i) Collection and settlement--(1) Collection of penalty amounts. 
(i) The determined penalty amount may be deducted from any sums then or 
later owing by the United States to the laboratory subject to the 
penalty.
    (ii) Interest accrues on the unpaid balance of the penalty, 
beginning on the due date. Interest is computed at the rate specified in 
Sec.  405.378(d) of this chapter.
    (2) Settlement. CMS has authority to settle any case at any time 
before the ALJ issues a hearing decision.

[57 FR 7237, Feb. 28, 1992, as amended at 60 FR 20051, Apr. 24, 1995; 61 
FR 63749, Dec. 2, 1996]



Sec.  493.1836  State onsite monitoring.

    (a) Application. (1) CMS may require continuous or intermittent 
monitoring of a plan of correction by the State survey agency to ensure 
that the laboratory makes the improvements necessary to bring it into 
compliance with the condition level requirements. (The State monitor 
does not have management authority, that is, cannot hire or fire staff, 
obligate funds, or otherwise dictate how the laboratory operates. The 
monitor's responsibility is to oversee whether corrections are made.)
    (2) The laboratory must pay the costs of onsite monitoring by the 
State survey agency.
    (i) The costs are computed by multiplying the number of hours of 
onsite monitoring in the laboratory by the hourly rate negotiated by CMS 
and the State.
    (ii) The hourly rate includes salary, fringe benefits, travel, and 
other direct and indirect costs approved by CMS.
    (b) Procedures. Before imposing this sanction, CMS provides notice 
of sanction and opportunity to respond in accordance with Sec.  
493.1810.
    (c) Duration of sanction. (1) If CMS imposes onsite monitoring, the 
sanction continues until CMS determines that the laboratory has the 
capability to ensure compliance with all condition level requirements.
    (2) If the laboratory does not correct all deficiencies within 12 
months, and a revisit indicates that deficiencies remain, CMS cancels 
the laboratory's approval for Medicare payment for its services and 
notifies the laboratory of its intent to suspend, limit, or revoke the 
laboratory's certificate of compliance, registration certificate, 
certificate of accreditation, or certificate for PPM procedures.
    (3) If the laboratory still does not correct its deficiencies, the 
Medicare sanction continues until the suspension, limitation, or 
revocation of the laboratory's certificate of compliance, registration 
certificate, certificate of accreditation, or certificate for PPM 
procedures is effective.

[57 FR 7237, Feb. 28, 1992, as amended at 60 FR 20051, Apr. 24, 1995]



Sec.  493.1838  Training and technical assistance for unsuccessful participation in proficiency testing.

    If a laboratory's participation in proficiency testing is 
unsuccessful, CMS may require the laboratory to undertake training of 
its personnel, or to obtain necessary technical assistance, or both, in 
order to meet the requirements of the proficiency testing program. This 
requirement is separate from the principal and alternative sanctions set 
forth in Sec. Sec.  493.1806 and 493.1807.



Sec.  493.1840  Suspension, limitation, or revocation of any type of CLIA certificate.

    (a) Adverse action based on actions of the laboratory's owner, 
operator or employees. CMS may initiate adverse action to suspend, limit 
or revoke any CLIA certificate if CMS finds that a laboratory's owner or 
operator or one of its employees has--
    (1) Been guilty of misrepresentation in obtaining a CLIA 
certificate;
    (2) Performed, or represented the laboratory as entitled to perform, 
a laboratory examination or other procedure that is not within a 
category of laboratory examinations or other procedures authorized by 
its CLIA certificate;
    (3) Failed to comply with the certificate requirements and 
performance standards;
    (4) Failed to comply with reasonable requests by CMS for any 
information

[[Page 623]]

or work on materials that CMS concludes is necessary to determine the 
laboratory's continued eligibility for its CLIA certificate or continued 
compliance with performance standards set by CMS;
    (5) Refused a reasonable request by CMS or its agent for permission 
to inspect the laboratory and its operation and pertinent records during 
the hours that the laboratory is in operation;
    (6) Violated or aided and abetted in the violation of any provisions 
of CLIA and its implementing regulations;
    (7) Failed to comply with an alternative sanction imposed under this 
subpart; or
    (8) Within the preceding two-year period, owned or operated a 
laboratory that had its CLIA certificate revoked. (This provision 
applies only to the owner or operator, not to all of the laboratory's 
employees.)
    (b) Adverse action based on improper referrals in proficiency 
testing. If CMS determines that a laboratory has intentionally referred 
its proficiency testing samples to another laboratory for analysis, CMS 
revokes the laboratory's CLIA certificate for at least one year, and may 
also impose a civil money penalty.
    (c) Adverse action based on exclusion from Medicare. If the OIG 
excludes a laboratory from participation in Medicare, CMS suspends the 
laboratory's CLIA certificate for the period during which the laboratory 
is excluded.
    (d) Procedures for suspension or limitation--(1) Basic rule. Except 
as provided in paragraph (d)(2) of this section, CMS does not suspend or 
limit a CLIA certificate until after an ALJ hearing decision (as 
provided in Sec.  493.1844) that upholds suspension or limitation.
    (2) Exceptions. CMS may suspend or limit a CLIA certificate before 
the ALJ hearing in any of the following circumstances:
    (i) The laboratory's deficiencies pose immediate jeopardy.
    (ii) The laboratory has refused a reasonable request for information 
or work on materials.
    (iii) The laboratory has refused permission for CMS or a CMS agent 
to inspect the laboratory or its operation.
    (e) Procedures for revocation. (1) CMS does not revoke any type of 
CLIA certificate until after an ALJ hearing that upholds revocation.
    (2) CMS may revoke a CLIA certificate after the hearing decision 
even if it had not previously suspended or limited that certificate.
    (f) Notice to the OIG. CMS notifies the OIG of any violations under 
paragraphs (a)(1), (a)(2), (a)(6), and (b) of this section within 30 
days of the determination of the violation.



Sec.  493.1842  Cancellation of Medicare approval.

    (a) Basis for cancellation. (1) CMS always cancels a laboratory's 
approval to receive Medicare payment for its services if CMS suspends or 
revokes the laboratory's CLIA certificate.
    (2) CMS may cancel the laboratory's approval under any of the 
following circumstances:
    (i) The laboratory is out of compliance with a condition level 
requirement.
    (ii) The laboratory fails to submit a plan of correction 
satisfactory to CMS.
    (iii) The laboratory fails to correct all its deficiencies within 
the time frames specified in the plan of correction.
    (b) Notice and opportunity to respond. Before canceling a 
laboratory's approval to receive Medicare payment for its services, CMS 
gives the laboratory--
    (1) Written notice of the rationale for, effective date, and effect 
of, cancellation;
    (2) Opportunity to submit written evidence or other information 
against cancellation of the laboratory's approval.
    This sanction may be imposed before the hearing that may be 
requested by a laboratory, in accordance with the appeals procedures set 
forth in Sec.  493.1844.
    (c) Effect of cancellation. Cancellation of Medicare approval 
terminates any Medicare payment sanctions regardless of the time frames 
originally specified.



Sec.  493.1844  Appeals procedures.

    (a) General rules. (1) The provisions of this section apply to all 
laboratories and prospective laboratories that are dissatisfied with any 
initial determination under paragraph (b) of this section.

[[Page 624]]

    (2) Hearings are conducted in accordance with procedures set forth 
in subpart D of part 498 of this chapter, except that the authority to 
conduct hearings and issue decisions may be exercised by ALJs assigned 
to, or detailed to, the Departmental Appeals Board.
    (3) Any party dissatisfied with a hearing decision is entitled to 
request review of the decision as specified in subpart E of part 498 of 
this chapter, except that the authority to review the decision may be 
exercised by the Departmental Appeals Board.
    (4) When more than one of the actions specified in paragraph (b) of 
this section are carried out concurrently, the laboratory has a right to 
only one hearing on all matters at issue.
    (b) Actions that are initial determinations. The following actions 
are initial determinations and therefore are subject to appeal in 
accordance with this section:
    (1) The suspension, limitation, or revocation of the laboratory's 
CLIA certificate by CMS because of noncompliance with CLIA requirements.
    (2) The denial of a CLIA certificate.
    (3) The imposition of alternative sanctions under this subpart (but 
not the determination as to which alternative sanction or sanctions to 
impose).
    (4) The denial or cancellation of the laboratory's approval to 
receive Medicare payment for its services.
    (c) Actions that are not initial determinations. Actions that are 
not listed in paragraph (b) of this section are not initial 
determinations and therefore are not subject to appeal under this 
section. They include, but are not necessarily limited to, the 
following:
    (1) The finding that a laboratory accredited by a CMS-approved 
accreditation organization is no longer deemed to meet the conditions 
set forth in subparts H, J, K, M, and Q of this part. However, the 
suspension, limitation or revocation of a certificate of accreditation 
is an initial determination and is appealable.
    (2) The finding that a laboratory determined to be in compliance 
with condition-level requirements but has deficiencies that are not at 
the condition level.
    (3) The determination not to reinstate a suspended CLIA certificate 
because the reason for the suspension has not been removed or there is 
insufficient assurance that the reason will not recur.
    (4) The determination as to which alternative sanction or sanctions 
to impose, including the amount of a civil money penalty to impose per 
day or per violation.
    (5) The denial of approval for Medicare payment for the services of 
a laboratory that does not have in effect a valid CLIA certificate.
    (6) The determination that a laboratory's deficiencies pose 
immediate jeopardy.
    (7) The amount of the civil money penalty assessed per day or for 
each violation of Federal requirements.
    (d) Effect of pending appeals--(1) Alternative sanctions. The 
effective date of an alternative sanction (other than a civil money 
penalty) is not delayed because the laboratory has appealed and the 
hearing or the hearing decision is pending.
    (2) Suspension, limitation, or revocation of a laboratory's CLIA 
certificate--(i) General rule. Except as provided in paragraph 
(d)(2)(ii) of this section, suspension, limitation, or revocation of a 
CLIA certificate is not effective until after a hearing decision by an 
ALJ is issued.
    (ii) Exceptions. (A) If CMS determines that conditions at a 
laboratory pose immediate jeopardy, the effective date of the suspension 
or limitation of a CLIA certificate is not delayed because the 
laboratory has appealed and the hearing or the hearing decision is 
pending.
    (B) CMS may suspend or limit a laboratory's CLIA certificate before 
an ALJ hearing or hearing decision if the laboratory has refused a 
reasonable request for information (including but not limited to billing 
information), or for work on materials, or has refused permission for 
CMS or a CMS agent to inspect the laboratory or its operation.
    (3) Cancellation of Medicare approval. The effective date of the 
cancellation of a laboratory's approval to receive Medicare payment for 
its services is not delayed because the laboratory has

[[Page 625]]

appealed and the hearing or hearing decision is pending.
    (4) Effect of ALJ decision. (i) An ALJ decision is final unless, as 
provided in paragraph (a)(3) of this section, one of the parties 
requests review by the Departmental Appeals Board within 60 days, and 
the Board reviews the case and issues a revised decision.
    (ii) If an ALJ decision upholds a suspension imposed because of 
immediate jeopardy, that suspension becomes a revocation.
    (e) Appeal rights for prospective laboratories--(1) Reconsideration. 
Any prospective laboratory dissatisfied with a denial of a CLIA 
certificate, or of approval for Medicare payment for its services, may 
initiate the appeals process by requesting reconsideration in accordance 
with Sec. Sec.  498.22 through 498.25 of this chapter.
    (2) Notice of reopening. If CMS reopens an initial or reconsidered 
determination, CMS gives the prospective laboratory notice of the 
revised determination in accordance with Sec.  498.32 of this chapter.
    (3) ALJ hearing. Any prospective laboratory dissatisfied with a 
reconsidered determination under paragraph (e)(1) of this section or a 
revised reconsidered determination under Sec.  498.30 of this chapter is 
entitled to a hearing before an ALJ, as specified in paragraph (a)(2) of 
this section.
    (4) Review of ALJ hearing decisions. Any prospective laboratory that 
is dissatisfied with an ALJ's hearing decision or dismissal of a request 
for hearing may file a written request for review by the Departmental 
Appeals Board as provided in paragraph (a)(3) of this section.
    (f) Appeal rights of laboratories--(1) ALJ hearing. Any laboratory 
dissatisfied with the suspension, limitation, or revocation of its CLIA 
certificate, with the imposition of an alternative sanction under this 
subpart, or with cancellation of the approval to receive Medicare 
payment for its services, is entitled to a hearing before an ALJ as 
specified in paragraph (a)(2) of this section and has 60 days from the 
notice of sanction to request a hearing.
    (2) Review of ALJ hearing decisions. Any laboratory that is 
dissatisfied with an ALJ's hearing decision or dismissal of a request 
for hearing may file a written request for review by the Departmental 
Appeals Board, as provided in paragraph (a)(3) of this section.
    (3) Judicial review. Any laboratory dissatisfied with the decision 
to impose a civil money penalty or to suspend, limit, or revoke its CLIA 
certificate may, within 60 days after the decision becomes final, file 
with the U.S. Court of Appeals of the circuit in which the laboratory 
has its principal place of business, a petition for judicial review.
    (g) Notice of adverse action. (1) If CMS suspends, limits, or 
revokes a laboratory's CLIA certificate or cancels the approval to 
receive Medicare payment for its services, CMS gives notice to the 
laboratory, and may give notice to physicians, providers, suppliers, and 
other laboratory clients, according to the procedures set forth at Sec.  
493.1832. In addition, CMS notifies the general public each time one of 
these principal sanctions is imposed.
    (2) The notice to the laboratory--
    (i) Sets forth the reasons for the adverse action, the effective 
date and effect of that action, and the appeal rights if any; and
    (ii) When the certificate is limited, specifies the specialties or 
subspecialties of tests that the laboratory is no longer authorized to 
perform, and that are no longer covered under Medicare.
    (3) The notice to other entities includes the same information 
except the information about the laboratory's appeal rights.
    (h) Effective date of adverse action. (1) When the laboratory's 
deficiencies pose immediate jeopardy, the effective date of the adverse 
action is at least 5 days after the date of the notice.
    (2) When CMS determines that the laboratory's deficiencies do not 
pose immediate jeopardy, the effective date of the adverse action is at 
least 15 days after the date of the notice.

[57 FR 7237, Feb. 28, 1992; 57 FR 35761, Aug. 11, 1992, as amended at 68 
FR 3714, Jan. 24, 2003]



Sec.  493.1846  Civil action.

    If CMS has reason to believe that continuation of the activities of 
any laboratory, including a State-exempt laboratory, would constitute a 
significant hazard to the public health, CMS may bring suit in a U.S. 
District Court

[[Page 626]]

to enjoin continuation of the specific activity that is causing the 
hazard or to enjoin the continued operation of the laboratory if CMS 
deems it necessary. Upon proper showing, the court shall issue a 
temporary injunction or restraining order without bond against 
continuation of the activity.



Sec.  493.1850  Laboratory registry.

    (a) Once a year CMS makes available to physicians and to the general 
public specific information (including information provided to CMS by 
the OIG) that is useful in evaluating the performance of laboratories, 
including the following:
    (1) A list of laboratories that have been convicted, under Federal 
or State laws relating to fraud and abuse, false billing, or kickbacks.
    (2) A list of laboratories that have had their CLIA certificates 
suspended, limited, or revoked, and the reason for the adverse actions.
    (3) A list of persons who have been convicted of violating CLIA 
requirements, as specified in section 353(1) of the PHS Act, together 
with the circumstances of each case and the penalties imposed.
    (4) A list of laboratories on which alternative sanctions have been 
imposed, showing--
    (i) The effective date of the sanctions;
    (ii) The reasons for imposing them;
    (iii) Any corrective action taken by the laboratory; and
    (iv) If the laboratory has achieved compliance, the verified date of 
compliance.
    (5) A list of laboratories whose accreditation has been withdrawn or 
revoked and the reasons for the withdrawal or revocation.
    (6) All appeals and hearing decisions.
    (7) A list of laboratories against which CMS has brought suit under 
Sec.  493.1846 and the reasons for those actions.
    (8) A list of laboratories that have been excluded from 
participation in Medicare or Medicaid and the reasons for the exclusion.
    (b) The laboratory registry is compiled for the calendar year 
preceding the date the information is made available and includes 
appropriate explanatory information to aid in the interpretation of the 
data. It also contains corrections of any erroneous statements or 
information that appeared in the previous registry.

Subpart S [Reserved]



                         Subpart T_Consultations

    Source: 57 FR 7185, Feb. 28, 1992, unless otherwise noted.



Sec.  493.2001  Establishment and function of the Clinical Laboratory Improvement Advisory Committee.

    (a) HHS will establish a Clinical Laboratory Improvement Advisory 
Committee to advise and make recommendations on technical and scientific 
aspects of the provisions of this part 493.
    (b) The Clinical Laboratory Improvement Advisory Committee will be 
comprised of individuals involved in the provision of laboratory 
services, utilization of laboratory services, development of laboratory 
testing or methodology, and others as approved by HHS.
    (c) HHS will designate specialized subcommittees as necessary.
    (d) The Clinical Laboratory Improvement Advisory Committee or any 
designated subcommittees will meet as needed, but not less than once 
each year.
    (e) The Clinical Laboratory Improvement Advisory Committee or 
subcommittee, at the request of HHS, will review and make 
recommendations concerning:
    (1) Criteria for categorizing nonwaived testing;
    (2) Determination of waived tests;
    (3) Personnel standards;
    (4) Facility administration and quality systems standards.
    (5) Proficiency testing standards;
    (6) Applicability to the standards of new technology; and
    (7) Other issues relevant to part 493, if requested by HHS.
    (f) HHS will be responsible for providing the data and information, 
as

[[Page 627]]

necessary, to the members of the Clinical Laboratory Improvement 
Advisory Committee.

[57 FR 7185, Feb. 28, 1992, as amended at 58 FR 5237, Jan. 19, 1993; 60 
FR 20051, Apr. 24, 1995; 68 FR 3714, Jan. 24, 2003]



PART 494_ CONDITIONS FOR COVERAGE FOR END	STAGE RENAL DISEASE FACILITIES--Table of Contents




                      Subpart A_General Provisions

Sec.
494.1 Basis and scope.
494.10 Definitions.
494.20 Condition: Compliance with Federal, State, and local laws and 
          regulations.

                        Subpart B_Patient Safety

494.30 Condition: Infection control.
494.40 Condition: Water and dialysate quality.
494.50 Condition: Reuse of hemodialyzers and bloodlines.
494.60 Condition: Physical environment.

                         Subpart C_Patient Care

494.70 Condition: Patients' rights.
494.80 Condition: Patient assessment.
494.90 Condition: Patient plan of care.
494.100 Condition: Care at home.
494.110 Condition: Quality assessment and performance improvement.
494.120 Condition: Special purpose renal dialysis facilities.
494.130 Condition: Laboratory services.

                        Subpart D_Administration

494.140 Condition: Personnel qualifications.
494.150 Condition: Responsibilities of the medical director.
494.160 [Reserved]
494.170 Condition: Medical records.
494.180 Condition: Governance.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
l302 and l395hh).

    Source: 73 FR 20475, Apr. 15, 2008, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  494.1  Basis and scope.

    (a) Statutory basis. This part is based on the following provisions:
    (1) Section 299I of the Social Security Amendments of 1972 (Pub. L. 
92-603), which extended Medicare coverage to insured individuals, their 
spouses, and their dependent children with ESRD who require dialysis or 
transplantation.
    (2) Section 1861(e)(9) of the Act, which requires hospitals to meet 
such other requirements as the Secretary finds necessary in the interest 
of health and safety of individuals who are furnished services in the 
institution.
    (3) Section 1861(s)(2)(F) of the Act, which describes ``medical and 
other health services'' covered under Medicare to include home dialysis 
supplies and equipment, self-care home dialysis support services, and 
institutional dialysis services and supplies.
    (4) Section 1862(a) of the Act, which specifies exclusions from 
coverage.
    (5) Section 1881 of the Act, which authorizes Medicare coverage and 
payment for the treatment of ESRD in approved facilities, including 
institutional dialysis services, transplantation services, self-care 
home dialysis services, and the administration of erythropoiesis-
stimulating agent(s).
    (6) Section 12(d) of the National Technology Transfer and 
Advancement Act of 1995 (Pub. L. 104-113), which requires Federal 
agencies to use technical standards that are developed or adopted by 
voluntary consensus standards bodies, unless their use would be 
inconsistent with applicable law or otherwise impractical.
    (b) Scope. The provisions of this part establish the conditions for 
coverage of services under Medicare and are the basis for survey 
activities for the purpose of determining whether an ESRD facility's 
services may be covered.



Sec.  494.10  Definitions.

    As used in this part--
    Dialysis facility means an entity that provides outpatient 
maintenance dialysis services, or home dialysis training and support 
services, or both. A dialysis facility may be an independent or 
hospital-based unit (as described in Sec.  413.174(b) and (c) of this 
chapter) that includes a self-care dialysis unit that furnishes only 
self-dialysis services.
    Discharge means the termination of patient care services by a 
dialysis facility or the patient voluntarily terminating dialysis when 
he or she no longer wants to be dialyzed by that facility.

[[Page 628]]

    Furnishes directly means the ESRD facility provides the service 
through its own staff and employees or through individuals who are under 
direct contract to furnish these services personally for the facility.
    Home dialysis means dialysis performed at home by an ESRD patient or 
caregiver who has completed an appropriate course of training as 
described in Sec.  494.100(a) of this part.
    Self-dialysis means dialysis performed with little or no 
professional assistance by an ESRD patient or caregiver who has 
completed an appropriate course of training as specified in Sec.  
494.100(a) of this part.
    Transfer means a temporary or permanent move of a patient from one 
dialysis facility to another that requires a transmission of the 
patient's medical record to the facility receiving the patient.



Sec.  494.20  Condition: Compliance with Federal, State, and local laws and regulations.

    The facility and its staff must operate and furnish services in 
compliance with applicable Federal, State, and local laws and 
regulations pertaining to licensure and any other relevant health and 
safety requirements.



                        Subpart B_Patient Safety



Sec.  494.30  Condition: Infection control.

    The dialysis facility must provide and monitor a sanitary 
environment to minimize the transmission of infectious agents within and 
between the unit and any adjacent hospital or other public areas.
    (a) Standard: Procedures for infection control. The facility must 
demonstrate that it follows standard infection control precautions by 
implementing--
    (1)(i) The recommendations (with the exception of screening for 
hepatitis C), found in ``Recommendations for Preventing Transmission of 
Infections Among Chronic Hemodialysis Patients,'' developed by the 
Centers for Disease Control and Prevention, Morbidity and Mortality 
Weekly Report, volume 50, number RR05, April 27, 2001, pages 18 to 28. 
The Director of the Federal Register approves this incorporation by 
reference in accordance with 5 U.S.C. 552(a) and 1 CFR Part 51. This 
publication is available for inspection at the CMS Information Resource 
Center, 7500 Security Boulevard, Central Building, Baltimore, MD or at 
the National Archives and Records Administration (NARA). Copies may be 
obtained at the CMS Information Resource Center. For information on the 
availability of this material at NARA, call 202-741-6030, or go to: 
http://www.archives.gov/federal--register/code--of--regulations/ibr--
locations.html. The recommendation found under section header ``HBV-
Infected Patients'', found on pages 27 and 28 of RR05 (``Recommendations 
for Preventing Transmission of Infections Among Chronic Hemodialysis 
Patients''), concerning isolation rooms, must be complied with by 
February 9, 2009.
    (ii) When dialysis isolation rooms as required by (a)(1)(i) are 
available locally that sufficiently serve the needs of patients in the 
geographic area, a new dialysis facility may request a waiver of such 
requirement. Isolation room waivers may be granted at the discretion of, 
and subject to, additional qualifications as may be deemed necessary by 
the Secretary.
    (2) The ``Guidelines for the Prevention of Intravascular Catheter-
Related Infections'' entitled ``Recommendations for Placement of 
Intravascular Catheters in Adults and Children'' parts I-IV; and 
``Central Venous Catheters, Including PICCs, Hemodialysis, and Pulmonary 
Artery Catheters, in Adult and Pediatric Patients,'' Morbidity and 
Mortality Weekly Report, volume 51 number RR-10, pages 16 through 18, 
August 9, 2002. The Director of the Federal Register approves this 
incorporation by reference in accordance with 5 U.S.C. 552(a) and 1 CFR 
part 51. This publication is available for inspection at the CMS 
Information Resource Center, 7500 Security Boulevard, Central Building, 
Baltimore, MD or at the National Archives and Records Administration 
(NARA). Copies may be obtained at the CMS Information Resource Center. 
For information on the availability of this material at NARA, call 202-
741-6030, or go to: http://www.archives.gov/federal--register/code--of--
regulations/ibr--locations.html.

[[Page 629]]

    (3) Patient isolation procedures to minimize the spread of 
infectious agents and communicable diseases; and
    (4) Maintaining procedures, in accordance with applicable State and 
local laws and accepted public health procedures, for the--
    (i) Handling, storage, and disposal of potentially infectious waste; 
and
    (ii) Cleaning and disinfection of contaminated surfaces, medical 
devices, and equipment.
    (b) Standard: Oversight. The facility must--
    (1) Monitor and implement biohazard and infection control policies 
and activities within the dialysis unit;
    (2) Ensure that clinical staff demonstrate compliance with current 
aseptic techniques when dispensing and administering intravenous 
medications from vials and ampules; and
    (3) Require all clinical staff to report infection control issues to 
the dialysis facility's medical director (see Sec.  494.150 of this 
part) and the quality improvement committee.
    (c) Standard: Reporting. The facility must report incidences of 
communicable diseases as required by Federal, State, and local 
regulations.



Sec.  494.40  Condition: Water and dialysate quality.

    The facility must be able to demonstrate the following:
    (a) Standard: Water purity. Water and equipment used for dialysis 
meets the water and dialysate quality standards and equipment 
requirements found in the Association for the Advancement of Medical 
Instrumentation (AAMI) publication, ``Dialysate for hemodialysis,'' 
ANSI/AAMI RD52: 2004. The Director of the Federal Register approves this 
incorporation by reference in accordance with 5 U.S.C. 552(a) and 1 CFR 
part 51. This publication is available for inspection at the CMS 
Information Resource Center, 7500 Security Boulevard, Central Building, 
Baltimore, MD or at the National Archives and Records Administration 
(NARA). For information on the availability of this material at NARA, 
call 202-741-6030, or go to: http://www.archives.gov/federal--register/
code--of--regulations/ibr--locations.html. Copies may be purchased from 
the Association for the Advancement of Medical Instrumentation, 3300 
Washington Boulevard, Suite 400, Arlington, VA 22201-4598.
    (b) Standard: Chlorine/chloramines. (1) The water treatment system 
must include a component or carbon tank which removes chlorine/
chloramine along with a backup component or second carbon tank in series 
for chlorine/chloramine removal;
    (2)(i) If the test results from the port of the initial component or 
carbon tank referred to in section 6.2.5 of AAMI RD52:2004 are greater 
than 0.5 mg/L for free chlorine or 0.1 mg/L for chloramines, or equal to 
or greater than 0.1 mg/L of total chlorine, then the second component or 
carbon tank which removes chlorine/chloramine must be tested;
    (ii) If the test results from the last component or carbon tank are 
greater than the parameters for chlorine or chloramine specified in 
paragraph (b)(2)(i) of this section the facility must--
    (A) Immediately take corrective action to bring chlorine or 
chloramine levels into compliance with paragraph (b)(2)(i) of this 
section and confirm through testing that the corrective action has been 
effective, or terminate dialysis treatment to protect patients from 
exposure to chlorine/chloramine;
    (B) Only allow use of purified water in a holding tank, if 
appropriate, and if testing shows water chlorine or chloramine levels 
that are in compliance with paragraph (b)(2)(i) of this section; and
    (C) Immediately notify the medical director; and
    (D) Take corrective action to ensure ongoing compliance with 
acceptable chlorine and chloramine levels as described in paragraph 
(b)(2)(i) of this section.
    (c) Standard: Corrective action plan. Water testing results 
including, but not limited to, chemical, microbial, and endotoxin levels 
which meet AAMI action levels or deviate from the AAMI standards must be 
addressed with a corrective action plan that ensures patient safety.
    (d) Standard: Adverse events. A dialysis facility must maintain 
active surveillance of patient reactions during and following dialysis. 
When clinically

[[Page 630]]

indicated (for example, after adverse patient reactions) the facility 
must--
    (1) Obtain blood and dialysate cultures and endotoxin levels;
    (2) Evaluate the water purification system; and
    (3) Take corrective action.
    (e) Standard: In-center use of preconfigured hemodialysis systems. 
When using a preconfigured, FDA-approved hemodialysis system designed, 
tested and validated to yield AAMI quality (which includes standards for 
chemical and chlorine/chloramine testing) water and dialysate, the 
system's FDA-approved labeling must be adhered to for machine use and 
monitoring of the water and dialysate quality. The facility must meet 
all AAMI RD52:2004 requirements for water and dialysate. Moreover, the 
facility must perform bacteriological and endotoxin testing on a 
quarterly, or more frequent basis, as needed, to ensure that the water 
and dialysate are within AAMI limits.



Sec.  494.50  Condition: Reuse of hemodialyzers and bloodlines.

    (a) Standard: General requirements for the reuse of hemodialyzers 
and bloodlines. Certain hemodialyzers and bloodlines--
    (1) May be reused for certain patients with the exception of 
Hepatitis B positive patients;
    (2) Must be reused only for the same patient; and
    (3) Must be labeled for multiple reuse in accordance with the 
premarket notification provisions of section 510(k) of the Food, Drug, 
and Cosmetics Act and 21 CFR 876.5860.
    (b) Standard: Reprocessing requirements for the reuse of 
hemodialyzers and bloodlines. A dialysis facility that reuses 
hemodialyzers and bloodlines must adhere to the following reprocessing 
guidelines:
    (1) Meet the requirements of AAMI published in ``Reuse of 
Hemodialyzers,'' third edition, ANSI/AAMI RD47:2002 and RD47:2002/
A1:2003. The Director of the Federal Register approves this 
incorporation by reference in accordance with 5 U.S.C. 552(a) and 1 CFR 
part 51. This publication is available for inspection at the CMS 
Information Resource Center, 7500 Security Boulevard, Central Building, 
Baltimore, MD or at the National Archives and Records Administration 
(NARA). For information on the availability of this material at NARA, 
call 202-741-6030, or go to: http://www.archives.gov/federal--register/
code--of--regulations/ibr--locations.html. Copies may be purchased from 
the Association for the Advancement of Medical Instrumentation, 3300 
Washington Boulevard, Suite 400, Arlington, VA 22201-4598.
    (2) Reprocess hemodialyzers and bloodlines--
    (i) By following the manufacturer's recommendations; or
    (ii) Using an alternate method and maintaining documented evidence 
that the method is safe and effective.
    (3) Not expose hemodialyzers to more than one chemical germicide, 
other than bleach (used as a cleaner in this application), during the 
life of the dialyzer. All hemodialyzers must be discarded before a 
different chemical germicide is used in the facility.
    (c) Standard: Monitoring, evaluation, and reporting requirements for 
the reuse of hemodialyzers and bloodlines. In addition to the 
requirements for hemodialyzer and bloodline reuse specified in 
paragraphs (a) and (b) of this section, the dialysis facility must 
adhere to the following:
    (1) Monitor patient reactions during and following dialysis.
    (2) When clinically indicated (for example, after adverse patient 
reactions), the facility must--
    (i) Obtain blood and dialysate cultures and endotoxin levels; and
    (ii) Undertake evaluation of its dialyzer reprocessing and water 
purification system. When this evaluation suggests a cluster of adverse 
patient reactions is associated with hemodialyzer reuse, the facility 
must suspend reuse of hemodialyzers until it is satisfied the problem 
has been corrected.
    (iii) Report the adverse outcomes to the FDA and other Federal, 
State or local government agencies as required by law.



Sec.  494.60  Condition: Physical environment.

    The dialysis facility must be designed, constructed, equipped, and

[[Page 631]]

maintained to provide dialysis patients, staff, and the public a safe, 
functional, and comfortable treatment environment.
    (a) Standard: Building. The building in which dialysis services are 
furnished must be constructed and maintained to ensure the safety of the 
patients, the staff, and the public.
    (b) Standard: Equipment maintenance. The dialysis facility must 
implement and maintain a program to ensure that all equipment (including 
emergency equipment, dialysis machines and equipment, and the water 
treatment system) are maintained and operated in accordance with the 
manufacturer's recommendations.
    (c) Standard: Patient care environment. (1) The space for treating 
each patient must be sufficient to provide needed care and services, 
prevent cross-contamination, and to accommodate medical emergency 
equipment and staff.
    (2) The dialysis facility must:
    (i) Maintain a comfortable temperature within the facility; and
    (ii) Make reasonable accommodations for the patients who are not 
comfortable at this temperature.
    (3) The dialysis facility must make accommodations to provide for 
patient privacy when patients are examined or treated and body exposure 
is required.
    (4) Patients must be in view of staff during hemodialysis treatment 
to ensure patient safety (video surveillance will not meet this 
requirement).
    (d) Standard: Emergency preparedness. The dialysis facility must 
implement processes and procedures to manage medical and nonmedical 
emergencies that are likely to threaten the health or safety of the 
patients, the staff, or the public. These emergencies include, but are 
not limited to, fire, equipment or power failures, care-related 
emergencies, water supply interruption, and natural disasters likely to 
occur in the facility's geographic area.
    (1) Emergency preparedness of staff. The dialysis facility must 
provide appropriate training and orientation in emergency preparedness 
to the staff. Staff training must be provided and evaluated at least 
annually and include the following:
    (i) Ensuring that staff can demonstrate a knowledge of emergency 
procedures, including informing patients of--
    (A) What to do;
    (B) Where to go, including instructions for occasions when the 
geographic area of the dialysis facility must be evacuated;
    (C) Whom to contact if an emergency occurs while the patient is not 
in the dialysis facility. This contact information must include an 
alternate emergency phone number for the facility for instances when the 
dialysis facility is unable to receive phone calls due to an emergency 
situation (unless the facility has the ability to forward calls to a 
working phone number under such emergency conditions); and
    (D) How to disconnect themselves from the dialysis machine if an 
emergency occurs.
    (ii) Ensuring that, at a minimum, patient care staff maintain 
current CPR certification; and
    (iii) Ensuring that nursing staff are properly trained in the use of 
emergency equipment and emergency drugs.
    (2) Emergency preparedness patient training. The facility must 
provide appropriate orientation and training to patients, including the 
areas specified in paragraph (d)(1)(i) of this section.
    (3) Emergency equipment. Emergency equipment, including, but not 
limited to, oxygen, airways, suction, defibrillator or automated 
external defibrillator, artificial resuscitator, and emergency drugs, 
must be on the premises at all times and immediately available.
    (4) Emergency plans. The facility must--
    (i) Have a plan to obtain emergency medical system assistance when 
needed;
    (ii) Evaluate at least annually the effectiveness of emergency and 
disaster plans and update them as necessary; and
    (iii) Contact its local disaster management agency at least annually 
to ensure that such agency is aware of dialysis facility needs in the 
event of an emergency.
    (e) Standard: Fire safety. (1) Except as provided in paragraph 
(e)(2) of this section, by February 9, 2009. The dialysis facility must 
comply with applicable provisions of the 2000 edition of the

[[Page 632]]

Life Safety Code of the National Fire Protection Association (which is 
incorporated by reference at Sec.  403.744(a)(1)(i) of this chapter).
    (2) Notwithstanding paragraph (e)(1) of this section, dialysis 
facilities participating in Medicare as of October 14, 2008. Utilizing 
non-sprinklered buildings on such date may continue to use such 
facilities if such buildings were constructed before January 1, 2008 and 
State law so permits.
    (3) If CMS finds that a fire and safety code imposed by the 
facility's State law adequately protects a dialysis facility's patients, 
CMS may allow the State survey agency to apply the State's fire and 
safety code instead of the Life Safety Code.
    (4) After consideration of State survey agency recommendations, CMS 
may waive, for individual dialysis facilities and for appropriate 
periods, specific provisions of the Life Safety Code, if the following 
requirements are met:
    (i) The waiver would not adversely affect the health and safety of 
the dialysis facility's patients; and
    (ii) Rigid application of specific provisions of the Life Safety 
Code would result in an unreasonable hardship for the dialysis facility.



                         Subpart C_Patient Care



Sec.  494.70  Condition: Patients' rights.

    The dialysis facility must inform patients (or their 
representatives) of their rights (including their privacy rights) and 
responsibilities when they begin their treatment and must protect and 
provide for the exercise of those rights.
    (a) Standard: Patients' rights. The patient has the right to--
    (1) Respect, dignity, and recognition of his or her individuality 
and personal needs, and sensitivity to his or her psychological needs 
and ability to cope with ESRD;
    (2) Receive all information in a way that he or she can understand;
    (3) Privacy and confidentiality in all aspects of treatment;
    (4) Privacy and confidentiality in personal medical records;
    (5) Be informed about and participate, if desired, in all aspects of 
his or her care, and be informed of the right to refuse treatment, to 
discontinue treatment, and to refuse to participate in experimental 
research;
    (6) Be informed about his or her right to execute advance 
directives, and the facility's policy regarding advance directives;
    (7) Be informed about all treatment modalities and settings, 
including but not limited to, transplantation, home dialysis modalities 
(home hemodialysis, intermittent peritoneal dialysis, continuous 
ambulatory peritoneal dialysis, continuous cycling peritoneal 
dialysis),and in-facility hemodialysis. The patient has the right to 
receive resource information for dialysis modalities not offered by the 
facility, including information about alternative scheduling options for 
working patients;
    (8) Be informed of facility policies regarding patient care, 
including, but not limited to, isolation of patients;
    (9) Be informed of facility policies regarding the reuse of dialysis 
supplies, including hemodialyzers;
    (10) Be informed by the physician, nurse practitioner, clinical 
nurse specialist, or physician's assistant treating the patient for ESRD 
of his or her own medical status as documented in the patient's medical 
record, unless the medical record contains a documented 
contraindication;
    (11) Be informed of services available in the facility and charges 
for services not covered under Medicare;
    (12) Receive the necessary services outlined in the patient plan of 
care described in Sec.  494.90;
    (13) Be informed of the rules and expectations of the facility 
regarding patient conduct and responsibilities;
    (14) Be informed of the facility's internal grievance process;
    (15) Be informed of external grievance mechanisms and processes, 
including how to contact the ESRD Network and the State survey agency;
    (16) Be informed of his or her right to file internal grievances or 
external grievances or both without reprisal or denial of services; and
    (17) Be informed that he or she may file internal or external 
grievances, personally, anonymously or through a

[[Page 633]]

representative of the patient's choosing.
    (b) Standard: Right to be informed regarding the facility's 
discharge and transfer policies. The patient has the right to--
    (1) Be informed of the facility's policies for transfer, routine or 
involuntary discharge, and discontinuation of services to patients; and
    (2) Receive written notice 30 days in advance of an involuntary 
discharge, after the facility follows the involuntary discharge 
procedures described in Sec.  494.180(f)(4). In the case of immediate 
threats to the health and safety of others, an abbreviated discharge 
procedure may be allowed.
    (c) Standard: Posting of rights. The dialysis facility must 
prominently display a copy of the patient's rights in the facility, 
including the current State agency and ESRD network mailing addresses 
and telephone complaint numbers, where it can be easily seen and read by 
patients.



Sec.  494.80  Condition: Patient assessment.

    The facility's interdisciplinary team consists of, at a minimum, the 
patient or the patient's designee (if the patient chooses), a registered 
nurse, a physician treating the patient for ESRD, a social worker, and a 
dietitian. The interdisciplinary team is responsible for providing each 
patient with an individualized and comprehensive assessment of his or 
her needs. The comprehensive assessment must be used to develop the 
patient's treatment plan and expectations for care.
    (a) Standard: Assessment criteria. The patient's comprehensive 
assessment must include, but is not limited to, the following:
    (1) Evaluation of current health status and medical condition, 
including co-morbid conditions.
    (2) Evaluation of the appropriateness of the dialysis prescription, 
blood pressure, and fluid management needs.
    (3) Laboratory profile, immunization history, and medication 
history.
    (4) Evaluation of factors associated with anemia, such as 
hematocrit, hemoglobin, iron stores, and potential treatment plans for 
anemia, including administration of erythropoiesis-stimulating agent(s).
    (5) Evaluation of factors associated with renal bone disease.
    (6) Evaluation of nutritional status by a dietitian.
    (7) Evaluation of psychosocial needs by a social worker.
    (8) Evaluation of dialysis access type and maintenance (for example, 
arteriovenous fistulas, arteriovenous grafts, and peritoneal catheters).
    (9) Evaluation of the patient's abilities, interests, preferences, 
and goals, including the desired level of participation in the dialysis 
care process; the preferred modality (hemodialysis or peritoneal 
dialysis), and setting, (for example, home dialysis), and the patient's 
expectations for care outcomes.
    (10) Evaluation of suitability for a transplantation referral, based 
on criteria developed by the prospective transplantation center and its 
surgeon(s). If the patient is not suitable for transplantation referral, 
the basis for nonreferral must be documented in the patient's medical 
record.
    (11) Evaluation of family and other support systems.
    (12) Evaluation of current patient physical activity level.
    (13) Evaluation for referral to vocational and physical 
rehabilitation services.
    (b) Standard: Frequency of assessment for patients admitted to the 
dialysis facility. (1) An initial comprehensive assessment must be 
conducted on all new patients (that is, all admissions to a dialysis 
facility), within the latter of 30 calendar days or 13 outpatient 
hemodialysis sessions beginning with the first outpatient dialysis 
session.
    (2) A follow up comprehensive reassessment must occur within 3 
months after the completion of the initial assessment to provide 
information to adjust the patient's plan of care specified in Sec.  
494.90.
    (c) Standard: Assessment of treatment prescription. The adequacy of 
the patient's dialysis prescription, as described in Sec.  494.90(a)(1), 
must be assessed on an ongoing basis as follows:
    (1) Hemodialysis patients. At least monthly by calculating delivered 
Kt/V or an equivalent measure.

[[Page 634]]

    (2) Peritoneal dialysis patients. At least every 4 months by 
calculating delivered weekly Kt/V or an equivalent measure.
    (d) Standard: Patient reassessment. In accordance with the standards 
specified in paragraphs (a)(1) through (a)(13) of this section, a 
comprehensive reassessment of each patient and a revision of the plan of 
care must be conducted--
    (1) At least annually for stable patients; and
    (2) At least monthly for unstable patients including, but not 
limited to, patients with the following:
    (i) Extended or frequent hospitalizations;
    (ii) Marked deterioration in health status;
    (iii) Significant change in psychosocial needs; or
    (iv) Concurrent poor nutritional status, unmanaged anemia, and 
inadequate dialysis.



Sec.  494.90  Condition: Patient plan of care.

    The interdisciplinary team as defined at Sec.  494.80 must develop 
and implement a written, individualized comprehensive plan of care that 
specifies the services necessary to address the patient's needs, as 
identified by the comprehensive assessment and changes in the patient's 
condition, and must include measurable and expected outcomes and 
estimated timetables to achieve these outcomes. The outcomes specified 
in the patient plan of care must be consistent with current evidence-
based professionally-accepted clinical practice standards.
    (a) Standard: Development of patient plan of care. The 
interdisciplinary team must develop a plan of care for each patient. The 
plan of care must address, but not be limited to, the following:
    (1) Dose of dialysis. The interdisciplinary team must provide the 
necessary care and services to manage the patient's volume status; and 
achieve and sustain the prescribed dose of dialysis to meet a 
hemodialysis Kt/V of at least 1.2 and a peritoneal dialysis weekly Kt/V 
of at least 1.7 or meet an alternative equivalent professionally-
accepted clinical practice standard for adequacy of dialysis.
    (2) Nutritional status. The interdisciplinary team must provide the 
necessary care and counseling services to achieve and sustain an 
effective nutritional status. A patient's albumin level and body weight 
must be measured at least monthly. Additional evidence-based 
professionally-accepted clinical nutrition indicators may be monitored, 
as appropriate.
    (3) Mineral metabolism. Provide the necessary care to manage mineral 
metabolism and prevent or treat renal bone disease.
    (4) Anemia. The interdisciplinary team must provide the necessary 
care and services to achieve and sustain the clinically appropriate 
hemoglobin/hematocrit level. The patient's hemoglobin/hematocrit must be 
measured at least monthly. The dialysis facility must conduct an 
evaluation of the patient's anemia management needs. For a home dialysis 
patient, the facility must evaluate whether the patient can safely, 
aseptically, and effectively administer erythropoiesis-stimulating 
agents and store this medication under refrigeration if necessary. The 
patient's response to erythropoiesis-stimulating agent(s), including 
blood pressure levels and utilization of iron stores, must be monitored 
on a routine basis.
    (5) Vascular access. The interdisciplinary team must provide 
vascular access monitoring and appropriate, timely referrals to achieve 
and sustain vascular access. The hemodialysis patient must be evaluated 
for the appropriate vascular access type, taking into consideration co-
morbid conditions, other risk factors, and whether the patient is a 
potential candidate for arteriovenous fistula placement. The patient's 
vascular access must be monitored to prevent access failure, including 
monitoring of arteriovenous grafts and fistulae for symptoms of 
stenosis.
    (6) Psychosocial status. The interdisciplinary team must provide the 
necessary monitoring and social work interventions. These include 
counseling services and referrals for other social services, to assist 
the patient in achieving and sustaining an appropriate psychosocial 
status as measured by a standardized mental and physical assessment tool 
chosen by the social

[[Page 635]]

worker, at regular intervals, or more frequently on an as-needed basis.
    (7) Modality--(i) Home dialysis. The interdisciplinary team must 
identify a plan for the patient's home dialysis or explain why the 
patient is not a candidate for home dialysis.
    (ii) Transplantation status. When the patient is a transplant 
referral candidate, the interdisciplinary team must develop plans for 
pursuing transplantation. The patient's plan of care must include 
documentation of the--
    (A) Plan for transplantation, if the patient accepts the 
transplantation referral;
    (B) Patient's decision, if the patient is a transplantation referral 
candidate but declines the transplantation referral; or
    (C) Reason(s) for the patient's nonreferral as a transplantation 
candidate as documented in accordance with Sec.  494.80(a)(10).
    (8) Rehabilitation status. The interdisciplinary team must assist 
the patient in achieving and sustaining an appropriate level of 
productive activity, as desired by the patient, including the 
educational needs of pediatric patients (patients under the age of 18 
years), and make rehabilitation and vocational rehabilitation referrals 
as appropriate.
    (b) Standard: Implementation of the patient plan of care. (1) The 
patient's plan of care must--
    (i) Be completed by the interdisciplinary team, including the 
patient if the patient desires; and
    (ii) Be signed by team members, including the patient or the 
patient's designee; or, if the patient chooses not to sign the plan of 
care, this choice must be documented on the plan of care, along with the 
reason the signature was not provided.
    (2) Implementation of the initial plan of care must begin within the 
latter of 30 calendar days after admission to the dialysis facility or 
13 outpatient hemodialysis sessions beginning with the first outpatient 
dialysis session. Implementation of monthly or annual updates of the 
plan of care must be performed within 15 days of the completion of the 
additional patient assessments specified in Sec.  494.80(d).
    (3) If the expected outcome is not achieved, the interdisciplinary 
team must adjust the patient's plan of care to achieve the specified 
goals. When a patient is unable to achieve the desired outcomes, the 
team must--
    (i) Adjust the plan of care to reflect the patient's current 
condition;
    (ii) Document in the record the reasons why the patient was unable 
to achieve the goals; and
    (iii) Implement plan of care changes to address the issues 
identified in paragraph (b)(3)(ii) of this section.
    (4) The dialysis facility must ensure that all dialysis patients are 
seen by a physician, nurse practitioner, clinical nurse specialist, or 
physician's assistant providing ESRD care at least monthly, as evidenced 
by a monthly progress note placed in the medical record, and 
periodically while the hemodialysis patient is receiving in-facility 
dialysis.
    (c) Standard: Transplantation referral tracking. The 
interdisciplinary team must--
    (1) Track the results of each kidney transplant center referral;
    (2) Monitor the status of any facility patients who are on the 
transplant wait list; and
    (3) Communicate with the transplant center regarding patient 
transplant status at least annually, and when there is a change in 
transplant candidate status.
    (d) Standard: Patient education and training. The patient care plan 
must include, as applicable, education and training for patients and 
family members or caregivers or both, in aspects of the dialysis 
experience, dialysis management, infection prevention and personal care, 
home dialysis and self-care, quality of life, rehabilitation, 
transplantation, and the benefits and risks of various vascular access 
types.



Sec.  494.100  Condition: Care at home.

    A dialysis facility that is certified to provide services to home 
patients must ensure through its interdisciplinary team, that home 
dialysis services are at least equivalent to those provided to in-
facility patients and meet all applicable conditions of this part.

[[Page 636]]

    (a) Standard: Training. The interdisciplinary team must oversee 
training of the home dialysis patient, the designated caregiver, or 
self-dialysis patient before the initiation of home dialysis or self-
dialysis (as defined in Sec.  494.10) and when the home dialysis 
caregiver or home dialysis modality changes. The training must--
    (1) Be provided by a dialysis facility that is approved to provide 
home dialysis services;
    (2) Be conducted by a registered nurse who meets the requirements of 
Sec.  494.140(b)(2); and
    (3) Be conducted for each home dialysis patient and address the 
specific needs of the patient, in the following areas:
    (i) The nature and management of ESRD.
    (ii) The full range of techniques associated with the treatment 
modality selected, including effective use of dialysis supplies and 
equipment in achieving and delivering the physician's prescription of 
Kt/V or URR, and effective administration of erythropoiesis-stimulating 
agent(s) (if prescribed) to achieve and maintain a target level 
hemoglobin or hematocrit as written in patient's plan of care.
    (iii) How to detect, report, and manage potential dialysis 
complications, including water treatment problems.
    (iv) Availability of support resources and how to access and use 
resources.
    (v) How to self-monitor health status and record and report health 
status information.
    (vi) How to handle medical and non-medical emergencies.
    (vii) Infection control precautions.
    (viii) Proper waste storage and disposal procedures.
    (b) Standard: Home dialysis monitoring. The dialysis facility must--
    (1) Document in the medical record that the patient, the caregiver, 
or both received and demonstrated adequate comprehension of the 
training;
    (2) Retrieve and review complete self-monitoring data and other 
information from self-care patients or their designated caregiver(s) at 
least every 2 months; and
    (3) Maintain this information in the patient's medical record.
    (c) Standard: Support services. (1) A home dialysis facility must 
furnish (either directly, under agreement, or by arrangement with 
another ESRD facility) home dialysis support services regardless of 
whether dialysis supplies are provided by the dialysis facility or a 
durable medical equipment company. Services include, but are not limited 
to, the following:
    (i) Periodic monitoring of the patient's home adaptation, including 
visits to the patient's home by facility personnel in accordance with 
the patient's plan of care.
    (ii) Coordination of the home patient's care by a member of the 
dialysis facility's interdisciplinary team.
    (iii) Development and periodic review of the patient's 
individualized comprehensive plan of care that specifies the services 
necessary to address the patient's needs and meets the measurable and 
expected outcomes as specified in Sec.  494.90 of this part.
    (iv) Patient consultation with members of the interdisciplinary 
team, as needed.
    (v) Monitoring of the quality of water and dialysate used by home 
hemodialysis patients including conducting an onsite evaluation and 
testing of the water and dialysate system in accordance with--
    (A) The recommendations specified in the manufacturers' 
instructions; and
    (B) The system's FDA-approved labeling for preconfigured systems 
designed, tested, and validated to meet AAMI quality (which includes 
standards for chemical and chlorine/chloramine testing) water and 
dialysate. The facility must meet testing and other requirements of AAMI 
RD52:2004. In addition, bacteriological and endotoxin testing must be 
performed on a quarterly, or more frequent basis as needed, to ensure 
that the water and dialysate are within the AAMI limits.
    (C) The dialysis facility must correct any water and dialysate 
quality problem for the home hemodialysis patient, and if necessary, 
arrange for backup dialysis until the problem is corrected if--
    (1) Analysis of the water and dialysate quality indicates 
contamination; or

[[Page 637]]

    (2) The home hemodialysis patient demonstrates clinical symptoms 
associated with water and dialysate contamination.
    (vi) Purchasing, leasing, renting, delivering, installing, repairing 
and maintaining medically necessary home dialysis supplies and equipment 
(including supportive equipment) prescribed by the attending physician.
    (vii) Identifying a plan and arranging for emergency back-up 
dialysis services when needed.
    (2) The dialysis facility must maintain a recordkeeping system that 
ensures continuity of care and patient privacy. This includes items and 
services furnished by durable medical equipment (DME) suppliers referred 
to in Sec.  414.330(a)(2) of this chapter.



Sec.  494.110  Condition: Quality assessment and performance improvement.

    The dialysis facility must develop, implement, maintain, and 
evaluate an effective, data-driven, quality assessment and performance 
improvement program with participation by the professional members of 
the interdisciplinary team. The program must reflect the complexity of 
the dialysis facility's organization and services (including those 
services provided under arrangement), and must focus on indicators 
related to improved health outcomes and the prevention and reduction of 
medical errors. The dialysis facility must maintain and demonstrate 
evidence of its quality improvement and performance improvement program 
for review by CMS.
    (a) Standard: Program scope. (1) The program must include, but not 
be limited to, an ongoing program that achieves measurable improvement 
in health outcomes and reduction of medical errors by using indicators 
or performance measures associated with improved health outcomes and 
with the identification and reduction of medical errors.
    (2) The dialysis facility must measure, analyze, and track quality 
indicators or other aspects of performance that the facility adopts or 
develops that reflect processes of care and facility operations. These 
performance components must influence or relate to the desired outcomes 
or be the outcomes themselves. The program must include, but not be 
limited to, the following:
    (i) Adequacy of dialysis.
    (ii) Nutritional status.
    (iii) Mineral metabolism and renal bone disease.
    (iv) Anemia management.
    (v) Vascular access.
    (vi) Medical injuries and medical errors identification.
    (vii) Hemodialyzer reuse program, if the facility reuses 
hemodialyzers.
    (viii) Patient satisfaction and grievances.
    (ix) Infection control; with respect to this component the facility 
must--
    (A) Analyze and document the incidence of infection to identify 
trends and establish baseline information on infection incidence;
    (B) Develop recommendations and action plans to minimize infection 
transmission, promote immunization; and
    (C) Take actions to reduce future incidents.
    (b) Standard: Monitoring performance improvement. The dialysis 
facility must continuously monitor its performance, take actions that 
result in performance improvements, and track performance to ensure that 
improvements are sustained over time.
    (c) Standard: Prioritizing improvement activities. The dialysis 
facility must set priorities for performance improvement, considering 
prevalence and severity of identified problems and giving priority to 
improvement activities that affect clinical outcomes or patient safety. 
The facility must immediately correct any identified problems that 
threaten the health and safety of patients.



Sec.  494.120  Condition: Special purpose renal dialysis facilities.

    A special purpose renal dialysis facility is approved to furnish 
dialysis on a short-term basis at special locations. Special purpose 
dialysis facilities are divided into two categories: vacation camps 
(locations that serve ESRD patients while the patients are in a 
temporary residence) and facilities established to serve ESRD patients 
under emergency circumstances.

[[Page 638]]

    (a) Standard: Approval period. The period of approval for a special 
purpose renal dialysis facility may not exceed 8 months in any 12-month 
period.
    (b) Standard: Service limitation. Special purpose renal dialysis 
facilities are limited to areas in which there are limited dialysis 
resources or access-to-care problems due to an emergency circumstance. A 
special purpose renal dialysis facility may provide services only to 
those patients who would otherwise be unable to obtain treatments in the 
geographic locality served by the facility.
    (c) Standard: Scope of requirements--(1) Scope of requirements for a 
vacation camp. A vacation camp that provides dialysis services must be 
operated under the direction of a certified renal dialysis facility that 
assumes full responsibility for the care provided to patients. A special 
purpose renal dialysis facility established as a vacation camp must 
comply with the following conditions for coverage--
    (i) Infection control at Sec.  494.30;
    (ii) Water and dialysate quality at Sec.  494.40 (except as provided 
in paragraph (c)(1)(viii) of this section);
    (iii) Reuse of hemodialyzers at Sec.  494.50 (if reuse is 
performed);
    (iv) Patients' rights and posting of patients' rights at Sec.  
494.70(a) and Sec.  494.70(c);
    (v) Laboratory services at Sec.  494.130;
    (vi) Medical director responsibilities for staff education and 
patient care policies and procedures at Sec.  494.150(c) and Sec.  
494.150(d);
    (vii) Medical records at Sec.  494.170; and
    (viii) When portable home water treatment systems are used in place 
of a central water treatment system, the facility may adhere to Sec.  
494.100(c)(1)(v) (home monitoring of water quality), in place of Sec.  
494.40 (water quality).
    (2) Scope of requirements for an emergency circumstance facility. A 
special purpose renal dialysis facility set up due to emergency 
circumstances may provide services only to those patients who would 
otherwise be unable to obtain treatments in the geographic areas served 
by the facility. These types of special purpose dialysis facilities must 
comply with paragraph (c)(1) of this section and addition to complying 
with the following conditions:
    (i) Section 494.20 (compliance with Federal, State, and local laws 
and regulations).
    (ii) Section 494.60 (physical environment).
    (iii) Section 494.70(a) through section 494.70(c) (patient rights).
    (iv) Section 494.140 (personnel qualifications).
    (v) Section 494.150 (medical director).
    (vi) Section 494.180 (governance).
    (d) Standard: Physician contact. The facility must contact the 
patient's physician, if possible, prior to initiating dialysis in the 
special purpose renal dialysis facility, to discuss the patient's 
current condition to assure care provided in the special purpose renal 
dialysis facility is consistent with the patient plan of care (described 
in Sec.  494.90).
    (e) Standard: Documentation. All patient care provided in the 
special purpose facility is documented and forwarded to the patient's 
usual dialysis facility, if possible, within 30 days of the last 
scheduled treatment in the special purpose renal dialysis facility.



Sec.  494.130  Condition: Laboratory services.

    The dialysis facility must provide, or make available, laboratory 
services (other than tissue pathology and histocompatibility) to meet 
the needs of the ESRD patient. Any laboratory services, including tissue 
pathology and histocompatibility must be furnished by or obtained from, 
a facility that meets the requirements for laboratory services specified 
in part 493 of this chapter.



                        Subpart D_Administration



Sec.  494.140  Condition: Personnel qualifications.

    All dialysis facility staff must meet the applicable scope of 
practice board and licensure requirements in effect in the State in 
which they are employed. The dialysis facility's staff (employee or 
contractor) must meet the personnel qualifications and demonstrated 
competencies necessary to serve collectively the comprehensive needs of 
the patients. The dialysis facility's staff must have the ability to 
demonstrate

[[Page 639]]

and sustain the skills needed to perform the specific duties of their 
positions.
    (a) Standard: Medical director. (1) The medical director must be a 
board-certified physician in internal medicine or pediatrics by a 
professional board who has completed a board-approved training program 
in nephrology and has at least 12-months of experience providing care to 
patients receiving dialysis.
    (2) If a physician, as specified in paragraph (a)(1) of this 
section, is not available to direct a certified dialysis facility 
another physician may direct the facility, subject to the approval of 
the Secretary.
    (b) Standard: Nursing services. (1) Nurse manager. The facility must 
have a nurse manager responsible for nursing services in the facility 
who must--
    (i) Be a full time employee of the facility;
    (ii) Be a registered nurse; and
    (iii) Have at least 12 months of experience in clinical nursing, and 
an additional 6 months of experience in providing nursing care to 
patients on maintenance dialysis.
    (2) Self-care and home dialysis training nurse. The nurse 
responsible for self-care and/or home care training must--
    (i) Be a registered nurse; and
    (ii) Have at least 12 months experience in providing nursing care 
and an additional 3 months of experience in the specific modality for 
which the nurse will provide self-care training.
    (3) Charge nurse. The charge nurse responsible for each shift must--
    (i) Be a registered nurse, a licensed practical nurse, or vocational 
nurse who meets the practice requirements in the State in which he or 
she is employed;
    (ii) Have at least 12 months experience in providing nursing care, 
including 3 months of experience in providing nursing care to patients 
on maintenance dialysis; and
    (iii) If such nurse is a licensed practical nurse or licensed 
vocational nurse, work under the supervision of a registered nurse in 
accordance with state nursing practice act provisions.
    (4) Staff nurse. Each nurse who provides care and treatment to 
patients must be either a registered nurse or a practical nurse who 
meets the practice requirements in the State in which he or she is 
employed.
    (c) Standard: Dietitian. The facility must have a dietitian who 
must--
    (1) Be a registered dietitian with the Commission on Dietetic 
Registration; and
    (2) Have a minimum of 1 year professional work experience in 
clinical nutrition as a registered dietitian.
    (d) Standard: Social worker. The facility must have a social worker 
who--
    (1) Holds a master's degree in social work with a specialization in 
clinical practice from a school of social work accredited by the Council 
on Social Work Education; or
    (2) Has served at least 2 years as a social worker, 1 year of which 
was in a dialysis unit or transplantation program prior to September 1, 
1976, and has established a consultative relationship with a social 
worker who qualifies under Sec.  494.140(d)(1).
    (e) Standard: Patient care dialysis technicians. Patient care 
dialysis technicians must--
    (1) Meet all applicable State requirements for education, training, 
credentialing, competency, standards of practice, certification, and 
licensure in the State in which he or she is employed as a dialysis 
technician; and
    (2) Have a high school diploma or equivalency;
    (3) Have completed a training program that is approved by the 
medical director and governing body, under the direction of a registered 
nurse, focused on the operation of kidney dialysis equipment and 
machines, providing direct patient care, and communication and 
interpersonal skills, including patient sensitivity training and care of 
difficult patients. The training program must include the following 
subjects:
    (i) Principles of dialysis.
    (ii) Care of patients with kidney failure, including interpersonal 
skills.
    (iii) Dialysis procedures and documentation, including initiation, 
proper cannulation techniques, monitoring, and termination of dialysis.
    (iv) Possible complications of dialysis.
    (v) Water treatment and dialysate preparation.
    (vi) Infection control.

[[Page 640]]

    (vii) Safety.
    (viii) Dialyzer reprocessing, if applicable.
    (4) Be certified under a State certification program or a national 
commercially available certification program, as follows--
    (i) For newly employed patient care technicians, within 18 months of 
being hired as a dialysis patient care technician; or
    (ii) For patient care technicians employed on October 14, 2008, 
within 18 months after such date.
    (f) Standard: Water treatment system technicians. Technicians who 
perform monitoring and testing of the water treatment system must 
complete a training program that has been approved by the medical 
director and the governing body.



Sec.  494.150  Condition: Responsibilities of the medical director.

    The dialysis facility must have a medical director who meets the 
qualifications of Sec.  494.140(a) to be responsible for the delivery of 
patient care and outcomes in the facility. The medical director is 
accountable to the governing body for the quality of medical care 
provided to patients. Medical director responsibilities include, but are 
not limited to, the following:
    (a) Quality assessment and performance improvement program.
    (b) Staff education, training, and performance.
    (c) Policies and procedures. The medical director must--
    (1) Participate in the development, periodic review and approval of 
a ``patient care policies and procedures manual'' for the facility; and
    (2) Ensure that--
    (i) All policies and procedures relative to patient admissions, 
patient care, infection control, and safety are adhered to by all 
individuals who treat patients in the facility, including attending 
physicians and nonphysician providers; and
    (ii) The interdisciplinary team adheres to the discharge and 
transfer policies and procedures specified in Sec.  494.180(f).



Sec.  494.160  [Reserved]



Sec.  494.170  Condition: Medical records.

    The dialysis facility must maintain complete, accurate, and 
accessible records on all patients, including home patients who elect to 
receive dialysis supplies and equipment from a supplier that is not a 
provider of ESRD services and all other home dialysis patients whose 
care is under the supervision of the facility.
    (a) Standard: Protection of the patient's record. The dialysis 
facility must--
    (1) Safeguard patient records against loss, destruction, or 
unauthorized use; and
    (2) Keep confidential all information contained in the patient's 
record, except when release is authorized pursuant to one of the 
following:
    (i) The transfer of the patient to another facility.
    (ii) Certain exceptions provided for in the law.
    (iii) Provisions allowed under third party payment contracts.
    (iv) Approval by the patient.
    (v) Inspection by authorized agents of the Secretary, as required 
for the administration of the dialysis program.
    (3) Obtaining written authorization from the patient or legal 
representative before releasing information that is not authorized by 
law.
    (b) Standard: Completion of patient records and centralization of 
clinical information. (1) Current medical records and those of 
discharged patients must be completed promptly.
    (2) All clinical information pertaining to a patient must be 
centralized in the patient's record, including whether the patient has 
executed an advance directive. These records must be maintained in a 
manner such that each member of the interdisciplinary team has access to 
current information regarding the patient's condition and prescribed 
treatment.
    (3) The dialysis facility must complete, maintain, and monitor home 
care patients' records, including the records of patients who receive 
supplies and equipment from a durable medical equipment supplier.
    (c) Standard: Record retention and preservation. In accordance with 
45 CFR Sec.  164.530(j)(2), all patient records must

[[Page 641]]

be retained for 6 years from the date of the patient's discharge, 
transfer, or death.
    (d) Standard: Transfer of patient record information. When a 
dialysis patient is transferred, the dialysis facility releasing the 
patient must send all requested medical record information to the 
receiving facility within 1 working day of the transfer.



Sec.  494.180  Condition: Governance.

    The ESRD facility is under the control of an identifiable governing 
body, or designated person(s) with full legal authority and 
responsibility for the governance and operation of the facility. The 
governing body adopts and enforces rules and regulations relative to its 
own governance and to the health care and safety of patients, to the 
protection of the patients' personal and property rights, and to the 
general operation of the facility.
    (a) Standard: Designating a chief executive officer or 
administrator. The governing body or designated person responsible must 
appoint an individual who serves as the dialysis facility's chief 
executive officer or administrator who exercises responsibility for the 
management of the facility and the provision of all dialysis services, 
including, but not limited to--
    (1) Staff appointments;
    (2) Fiscal operations;
    (3) The relationship with the ESRD networks; and
    (4) Allocation of necessary staff and other resources for the 
facility's quality assessment and performance improvement program as 
described in Sec.  494.110.
    (b) Standard: Adequate number of qualified and trained staff. The 
governing body or designated person responsible must ensure that--
    (1) An adequate number of qualified personnel are present whenever 
patients are undergoing dialysis so that the patient/staff ratio is 
appropriate to the level of dialysis care given and meets the needs of 
patients; and the registered nurse, social worker and dietitian members 
of the interdisciplinary team are available to meet patient clinical 
needs;
    (2) A registered nurse, who is responsible for the nursing care 
provided, is present in the facility at all times that in-center 
dialysis patients are being treated;
    (3) All staff, including the medical director, have appropriate 
orientation to the facility and their work responsibilities; and
    (4) All employees have an opportunity for continuing education and 
related development activities.
    (c) Standard: Medical staff appointments. The governing body--
    (1) Is responsible for all medical staff appointments and 
credentialing in accordance with State law, including attending 
physicians, physician assistants, nurse practitioners, and clinical 
nurse specialists; and
    (2) Ensures that all medical staff who provide care in the facility 
are informed of all facility policies and procedures, including the 
facility's quality assessment and performance improvement program 
specified in Sec.  494.110.
    (3) Communicates expectations to the medical staff regarding staff 
participation in improving the quality of medical care provided to 
facility patients.
    (d) Standard: Furnishing services. The governing body is responsible 
for ensuring that the dialysis facility furnishes services directly on 
its main premises or on other premises that are contiguous with the main 
premises and are under the direction of the same professional staff and 
governing body as the main premises (except for services provided under 
Sec.  494.100).
    (e) Standard: Internal grievance process. The facility's internal 
grievance process must be implemented so that the patient may file an 
oral or written grievance with the facility without reprisal or denial 
of services. The grievance process must include:
    (1) A clearly explained procedure for the submission of grievances.
    (2) Timeframes for reviewing the grievance.
    (3) A description of how the patient or the patient's designated 
representative will be informed of steps taken to resolve the grievance.
    (f) Standard: Involuntary discharge and transfer policies and 
procedures. The governing body must ensure that all staff follow the 
facility's patient discharge and transfer policies and procedures. The 
medical director ensures that no

[[Page 642]]

patient is discharged or transferred from the facility unless--
    (1) The patient or payer no longer reimburses the facility for the 
ordered services;
    (2) The facility ceases to operate;
    (3) The transfer is necessary for the patient's welfare because the 
facility can no longer meet the patient's documented medical needs; or
    (4) The facility has reassessed the patient and determined that the 
patient's behavior is disruptive and abusive to the extent that the 
delivery of care to the patient or the ability of the facility to 
operate effectively is seriously impaired, in which case the medical 
director ensures that the patient's interdisciplinary team--
    (i) Documents the reassessments, ongoing problem(s), and efforts 
made to resolve the problem(s), and enters this documentation into the 
patient's medical record;
    (ii) Provides the patient and the local ESRD Network with a 30-day 
notice of the planned discharge;
    (iii) Obtains a written physician's order that must be signed by 
both the medical director and the patient's attending physician 
concurring with the patient's discharge or transfer from the facility;
    (iv) Contacts another facility, attempts to place the patient there, 
and documents that effort; and
    (v) Notifies the State survey agency of the involuntary transfer or 
discharge.
    (5) In the case of immediate severe threats to the health and safety 
of others, the facility may utilize an abbreviated involuntary discharge 
procedure.
    (g) Standard: Emergency coverage. (1) The governing body is 
responsible for ensuring that the dialysis facility provides patients 
and staff with written instructions for obtaining emergency medical 
care.
    (2) The dialysis facility must have available at the nursing/
monitoring station, a roster with the names of physicians to be called 
for emergencies, when they can be called, and how they can be reached.
    (3) The dialysis facility must have an agreement with a hospital 
that can provide inpatient care, routine and emergency dialysis and 
other hospital services, and emergency medical care which is available 
24 hours a day, 7 days a week. The agreement must:
    (i) Ensure that hospital services are available promptly to the 
dialysis facility's patients when needed.
    (ii) Include reasonable assurances that patients from the dialysis 
facility are accepted and treated in emergencies.
    (h) Standard: Furnishing data and information for ESRD program 
administration. Effective February 1, 2009, the dialysis facility must 
furnish data and information to CMS and at intervals as specified by the 
Secretary. This information is used in a national ESRD information 
system and in compilations relevant to program administration, including 
claims processing and reimbursement, quality improvement, and 
performance assessment. The data and information must--
    (1) Be submitted at the intervals specified by the Secretary;
    (2) Be submitted electronically in the format specified by the 
Secretary;
    (3) Include, but not be limited to--
    (i) Cost reports;
    (ii) ESRD administrative forms;
    (iii) Patient survival information; and
    (iv) Existing ESRD clinical performance measures, and any future 
clinical performance standards developed in accordance with a voluntary 
consensus standards process identified by the Secretary.
    (i) Standard: Relationship with the ESRD network. The governing body 
receives and acts upon recommendations from the ESRD network. The 
dialysis facility must cooperate with the ESRD network designated for 
its geographic area, in fulfilling the terms of the Network's current 
statement of work. Each facility must participate in ESRD network 
activities and pursue network goals.
    (j) Standard: Disclosure of ownership. In accordance with Sec.  
420.200 through Sec.  420.206 of this chapter, the governing body must 
report ownership interests of 5 percent or more to its State survey 
agency.

[[Page 643]]



PART 498_APPEALS PROCEDURES FOR DETERMINATIONS THAT AFFECT PARTICIPATION IN THE MEDICARE PROGRAM AND FOR DETERMINATIONS THAT AFFECT THE PARTICIPATION OF ICFs/MR 
AND CERTAIN NFs IN THE MEDICAID PROGRAM--Table of Contents




                      Subpart A_General Provisions

Sec.
498.1 Statutory basis.
498.2 Definitions.
498.3 Scope and applicability.
498.4 NFs subject to appeals process in part 498.
498.5 Appeal rights.
498.10 Appointment of representatives.
498.11 Authority of representatives.
498.13 Fees for services of representatives.
498.15 Charge for transcripts.
498.17 Filing of briefs with the ALJ or Departmental Appeals Board, and 
          opportunity for rebuttal.

       Subpart B_Initial, Reconsidered, and Revised Determinations

498.20 Notice and effect of initial determinations.
498.22 Reconsideration.
498.23 Withdrawal of request for reconsideration.
498.24 Reconsidered determination.
498.25 Notice and effect of reconsidered determination.

      Subpart C_Reopening of Initial or Reconsidered Determinations

498.30 Limitation on reopening.
498.32 Notice and effect of reopening and revision.

                           Subpart D_Hearings

498.40 Request for hearing.
498.42 Parties to the hearing.
498.44 Designation of hearing official.
498.45 Disqualification of Administrative Law Judge.
498.47 Prehearing conference.
498.48 Notice of prehearing conference.
498.49 Conduct of prehearing conference.
498.50 Record, order, and effect of prehearing conference.
498.52 Time and place of hearing.
498.53 Change in time and place of hearing.
498.54 Joint hearings.
498.56 Hearing on new issues.
498.58 Subpoenas.
498.60 Conduct of hearing.
498.61 Evidence.
498.62 Witnesses.
498.63 Oral and written summation.
498.64 Record of hearing.
498.66 Waiver of right to appear and present evidence.
498.68 Dismissal of request for hearing.
498.69 Dismissal for abandonment.
498.70 Dismissal for cause.
498.71 Notice and effect of dismissal and right to request review.
498.72 Vacating a dismissal of request for hearing.
498.74 Administrative Law Judge's decision.
498.76 Removal of hearing to Departmental Appeals Board.
498.78 Remand by the Administrative Law Judge.
498.79 Timeframes for deciding an enrollment appeal before an ALJ.

               Subpart E_Departmental Appeals Board Review

498.80 Right to request Departmental Appeals Board review of 
          Administrative Law Judge's decision or dismissal.
498.82 Request for Departmental Appeals Board review.
498.83 Departmental Appeals Board action on request for review.
498.85 Procedures before the Departmental Appeals Board on review.
498.86 Evidence admissible on review.
498.88 Decision or remand by the Departmental Appeals Board.
498.90 Effect of Departmental Appeals Board decision.
498.95 Extension of time for seeking judicial review.

 Subpart F_Reopening of Decisions Made by Administrative Law Judges or 
                     the Departmental Appeals Board

498.100 Basis, timing, and authority for reopening an ALJ or Board 
          decision.
498.102 Revision of reopened decision.
498.103 Notice and effect of revised decision.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 
1302 and 1395hh).

    Source: 52 FR 22446, June 12, 1987, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  498.1  Statutory basis.

    (a) Section 1866(h) of the Act provides for a hearing and for 
judicial review of the hearing for any institution or agency 
dissatisfied with a determination that it is not a provider, or with any 
determination described in section 1866(b)(2) of the Act.

[[Page 644]]

    (b) Section 1866(b)(2) of the Act lists determinations that serve as 
a basis for termination of a provider agreement.
    (c) Sections 1128 (a) and (b) of the Act provide for exclusion of 
certain individuals or entities because of conviction of crimes related 
to their participation in Medicare and section 1128(f) provides for 
hearing and judicial review for exclusions.
    (d) Section 1156 of the Act establishes certain obligations for 
practitioners and providers of health care services, and provides 
sanctions and penalties for those that fail to meet those obligations.
    (e)-(f) [Reserved]
    (g) Section 1866(j) of the Act provides for a hearing and judicial 
review for any provider or supplier whose application for enrollment or 
reenrollment in Medicare is denied or whose billing privileges are 
revoked.
    (h) Section 1128A(c)(2) of the Act provides that the Secretary may 
not collect a civil money penalty until the affected entity has had 
notice and opportunity for a hearing.
    (i) Section 1819(h) of the Act--
    (1) Provides that, for SNFs found to be out of compliance with the 
requirements for participation, specified remedies may be imposed 
instead of, or in addition to, termination of the facility's Medicare 
provider agreement; and
    (2) Makes certain provisions of section 1128A of the Act applicable 
to civil money penalties imposed on SNFs.
    (j) Section 1891(e) of the Act provides that, for home health 
agencies (HHAs) found to be out of compliance with the conditions of 
participation, specified remedies may be imposed instead of, or in 
addition to, termination of the HHA's Medicare provider agreement.
    (k) Section 1891(f) of the Act--
    (1) Requires the Secretary to develop a range of such remedies; and
    (2) Makes certain provisions of section 1128A of the Act applicable 
to civil money penalties imposed on HHAs.

[52 FR 22446, June 12, 1987, as amended at 59 FR 56251, Nov. 10, 1994; 
61 FR 32349, June 24, 1996; 73 FR 36462, June 27, 2008]



Sec.  498.2  Definitions.

    As used in this part--
    Affected party means a provider, prospective provider, supplier, 
prospective supplier, or practitioner that is affected by an initial 
determination or by any subsequent determination or decision issued 
under this part, and ``party'' means the affected party or CMS, as 
appropriate. For provider or supplier enrollment appeals, an affected 
party includes CMS or a CMS contractor.
    ALJ stands for Administrative Law Judge.
    Departmental Appeals Board or Board means a Board established in the 
Office of the Secretary to provide impartial review of disputed 
decisions made by the operating components of the Department.
    OIG stands for the Department's Office of the Inspector General.
    Prospective provider means any of the entities specified in the 
definition of provider under this section that seeks to be approved for 
coverage of its services by Medicare or to have any facility or 
organization determined to be a department of the provider or provider-
based entity under Sec.  413.65 of this chapter.
    Prospective supplier means any of the listed entities specified in 
the definition of supplier in this section that seek to be approved for 
coverage of its services by Medicare.
    Provider means either of the following:
    (1) Any of the following entities that have in effect an agreement 
to participate in Medicare:
    (i) Hospital.
    (ii) Transplant center.
    (iii) Critical access hospital (CAH).
    (iv) Skilled nursing facility (SNF).
    (v) Comprehensive outpatient rehabilitation facility (CORF).
    (vi) Home health agency (HHA).
    (vii) Hospice.
    (viii) Religious nonmedical health care institution (RNHCI).
    (2) Any of the following entities that have in effect an agreement 
to participate in Medicare but only to furnish outpatient physical 
therapy or outpatient speech pathology services.
    (i) Clinic.
    (ii) Rehabilitation agency.
    (iii) Public health agency.
    Supplier means any of the following entities that have in effect an 
agreement to participate in Medicare:

[[Page 645]]

    (1) An independent laboratory.
    (2) Supplier of durable medical equipment prosthetics, orthotics, or 
supplies (DMEPOS).
    (3) Ambulance service provider.
    (4) Independent diagnostic testing facility.
    (5) Physician or other practitioner such as physician assistant.
    (6) Physical therapist in independent practice.
    (7) Supplier of portable X-ray services.
    (8) Rural health clinic (RHC).
    (9) Federally qualified health center (FQHC).
    (10) Ambulatory surgical center (ASC).
    (11) An entity approved by CMS to furnish outpatient diabetes self-
management training.
    (12) End-stage renal disease (ESRD) treatment facility that is 
approved by CMS as meeting the conditions for coverage of its services.

[52 FR 22446, June 12, 1987, as amended at 53 FR 6551, March 1, 1988; 57 
FR 24984, June 12, 1992; 58 FR 30677, May 26, 1993; 59 FR 6579, Feb. 11, 
1994; 59 FR 56251, Nov. 10, 1994; 61 FR 32350, June 24, 1996; 62 FR 
46037, Aug. 29, 1997; 65 FR 18549, Apr. 7, 2000; 65 FR 83154, Dec. 29, 
2000; 68 FR 66721, Nov. 28, 2003; 71 FR 31054, May 31, 2006; 72 FR 
15280, Mar. 30, 2007; 73 FR 36462, June 27, 2008]



Sec.  498.3  Scope and applicability.

    (a) Scope. (1) This part sets forth procedures for reviewing initial 
determinations that CMS makes with respect to the matters specified in 
paragraph (b) of this section, and that the OIG makes with respect to 
the matters specified in paragraph (c) of this section. It also 
specifies, in paragraph (d) of this section, administrative actions that 
are not subject to appeal under this part.
    (2) The determinations listed in this section affect participation 
in the Medicare program. Many of the procedures of this part also apply 
to other determinations that do not affect participation in Medicare. 
Some examples follow:
    (i) CMS's determination to terminate an NF's Medicaid provider 
agreement.
    (ii) CMS's determination to cancel the approval of an ICF/MR under 
section 1910(b) of the Act.
    (iii) CMS's determination, under the Clinical Laboratory Improvement 
Act (CLIA), to impose alternative sanctions or to suspend, limit, or 
revoke the certificate of a laboratory even though it does not 
participate in Medicare.
    (3) The following parts of this chapter specify the applicability of 
the provisions of this part 498 to sanctions or remedies imposed on the 
indicated entities:
    (i) Part 431, subpart D--for nursing facilities (NFs).
    (ii) Part 488, subpart E (Sec.  488.330(e))--for SNFs and NFs.
    (iii) Part 493, subpart R (Sec.  493.1844)--for laboratories.
    (b) Initial determinations by CMS. CMS makes initial determinations 
with respect to the following matters:
    (1) Whether a prospective provider qualifies as a provider.
    (2) Whether a prospective department of a provider, remote location 
of a hospital, satellite facility, or provider-based entity qualifies 
for provider-based status under Sec.  413.65 of this chapter, or whether 
such a facility or entity currently treated as a department of a 
provider, remote location of a hospital, satellite facility, or a 
provider-based entity no longer qualifies for that status under Sec.  
413.65 of this chapter.
    (3) Whether an institution is a hospital qualified to elect to claim 
payment for all emergency hospital services furnished in a calendar 
year.
    (4) Whether an institution continues to remain in compliance with 
the qualifications for claiming reimbursement for all emergency services 
furnished in a calendar year.
    (5) Whether a prospective supplier meets the conditions for coverage 
of its services as those conditions are set forth elsewhere in this 
chapter.
    (6) Whether the services of a supplier continue to meet the 
conditions for coverage.
    (7) Whether a physical therapist in independent practice or a 
chiropractor meets the requirements for coverage of his or her services 
as set forth in subpart D of part 486 of this chapter and Sec.  410.22 
of this chapter, respectively.
    (8) The termination of a provider agreement in accordance with Sec.  
489.53 of this chapter, or the termination of a

[[Page 646]]

rural health clinic agreement in accordance with Sec.  405.2404 of this 
chapter, or the termination of a Federally qualified health center 
agreement in accordance with Sec.  405.2436 of this chapter.
    (9) CMS's cancellation, under section 1910(b) of the Act, of an ICF/
MR's approval to participate in Medicaid.
    (10) Whether, for purposes of rate setting and reimbursement, an 
ESRD treatment facility is considered to be hospital-based or 
independent.
    (11) [Reserved]
    (12) Whether a hospital, skilled nursing facility, home health 
agency, or hospice program meets or contimues to meet the advance 
directives requirements specified in subpart I of part 489 of this 
chapter.
    (13) With respect to an SNF or NF, a finding of noncompliance that 
results in the imposition of a remedy specified in Sec.  488.406 of this 
chapter, except the State monitoring remedy.
    (14) The level of noncompliance found by CMS in a SNF or NF but only 
if a successful challenge on this issue would affect--
    (i) The range of civil money penalty amounts that CMS could collect 
(The scope of review during a hearing on imposition of a civil money 
penalty is set forth in Sec.  488.438(e) of this chapter); or
    (ii) A finding of substandard quality of care that results in the 
loss of approval for a SNF or NF of its nurse aide training program.
    (15) The effective date of a Medicare provider agreement or supplier 
approval.
    (16) The finding of substandard quality of care that leads to the 
loss by a SNF or NF of the approval of its nurse aide training program.
    (17) Whether to deny or revoke a provider or supplier's Medicare 
enrollment in accordance with Sec.  424.530 or Sec.  424.535 of this 
chapter.
    (c) Initial determinations by the OIG. The OIG makes initial 
determinations with respect to the following matters:
    (1) The termination of a provider agreement in accordance with part 
1001, subpart C of this title.
    (2) The suspension, or exclusion from coverage and the denial of 
reimbursement for services furnished by a provider, practitioner, or 
supplier, because of fraud or abuse, or conviction of crimes related to 
participation in the program, in accordance with part 1001, subpart B of 
this title.
    (3) The imposition of sanctions in accordance with part 1004 of this 
title.
    (d) Administrative actions that are not initial determinations. 
Administrative actions that are not initial determination (and therefore 
not subject to appeal under this part) include but are not limited to 
the following:
    (1) The finding that a provider or supplier determined to be in 
compliance with the conditions or requirements for participation or for 
coverage has deficiencies.
    (2) The finding that a prospective provider does not meet the 
conditions of participation set forth elsewhere in this chapter, if the 
prospective provider is, nevertheless, approved for participation in 
Medicare on the basis of special access certification, as provided in 
subpart B of part 488 of this chapter.
    (3) The refusal to enter into a provider agreement because the 
prospective provider is unable to give satisfactory assurance of 
compliance with the requirements of title XVIII of the Act.
    (4) The finding that an entity that had its provider agreement 
terminated may not file another agreement because the reasons for 
terminating the previous agreement have not been removed or there is 
insufficient assurance that the reasons for the exclusion will not 
recur.
    (5) The determination not to reinstate a suspended or excluded 
practitioner, provider, or supplier because the reason for the 
suspension or exclusion has not been removed, or there is insufficient 
assurance that the reason will not recur.
    (6) The finding that the services of a laboratory are covered as 
hospital services or as physician's services, rather than as services of 
an independent laboratory, because the laboratory is not independent of 
the hospital or of the physician's office.
    (7) The refusal to accept for filing an election to claim payment 
for all emergency hospital services furnished in a calendar year because 
the institution--
    (i) Had previously charged an individual or other person for 
services furnished during that calendar year;

[[Page 647]]

    (ii) Submitted the election after the close of that calendar year; 
or
    (iii) Had previously been notified of its failure to continue to 
comply.
    (8) The finding that the reason for the revocation of a supplier's 
right to accept assignment has not been removed or there is insufficient 
assurance that the reason will not recur.
    (9) The finding that a hospital accredited by the Joint Commission 
on Accreditation of Hospitals or the American Osteopathic Association is 
not in compliance with a condition of participation, and a finding that 
that hospital is no longer deemed to meet the conditions of 
participation.
    (10) With respect to an SNF or NF-(i) The finding that the SNF's or 
NF's deficiencies pose immediate jeopardy to the health or safety of its 
residents;
    (ii) Except as provided in paragraph (b)(13) of this section, a 
determination by CMS as to the facility's level of noncompliance; and
    (iii) The imposition of State monitoring.
    (11) The choice of alternative sanction or remedy to be imposed on a 
provider or supplier.
    (12) The determination that the accreditation requirements of a 
national accreditation organization do not provide (or do not continue 
to provide) reasonable assurance that the entities accredited by the 
accreditation organization meet the applicable long-term care 
requirements, conditions for coverage, conditions of certification, 
conditions of participation, or CLIA condition level requirements.
    (13) The determination that requirements imposed on a State's 
laboratories under the laws of that State do not provide (or do not 
continue to provide) reasonable assurance that laboratories licensed or 
approved by the State meet applicable CLIA requirements.
    (14) The choice of alternative sanction or remedy to be imposed on a 
provider or supplier.
    (15) A decision by the State survey agency as to when to conduct an 
initial survey of a prospective provider or supplier.
    (e) Exclusion of civil rights issues. The procedures in this subpart 
do not apply to the adjudication of issues relating to a provider's 
compliance with civil rights requirements that are set forth in part 489 
of this chapter. Those issues are handled through the Department's 
Office of Civil Rights.

[52 FR 22446, June 12, 1987, as amended at 52 FR 27765, July 23, 1987; 
53 FR 6551, March 1, 1988; 53 FR 6649, March 2, 1988; 54 FR 5373, Feb. 
2, 1989; 56 FR 8854, Mar. 1, 1991; 56 FR 48879, Sept. 26, 1991; 57 FR 
8204, Mar. 6, 1992; 57 FR 34021, July 31, 1992; 57 FR 43925, Sept. 23, 
1992; 59 FR 56251, Nov. 10, 1994; 60 FR 2330, Jan. 9, 1995; 60 FR 50120, 
Sept. 28, 1995; 61 FR 32350, June 24, 1996; 62 FR 43937, Aug. 18, 1997; 
64 FR 24957, May 10, 1999; 64 FR 39937, July 23, 1999; 64 FR 43295, Aug. 
10, 1999; 65 FR 18549, Apr. 7, 2000; 65 FR 62646, Oct. 19, 2000; 71 FR 
20781, Apr. 21, 2006; 71 FR 37505, June 30, 2006]



Sec.  498.4  NFs subject to appeals process in part 498.

    A NF is considered a provider for purposes of this part when it has 
in effect an agreement to participate in Medicaid, including an 
agreement to participate in both Medicaid and Medicare and it is a--
    (a) State-operated NF; or
    (b) Non State-operated NF that is subject to compliance action as a 
result of--
    (1) A validation survey by CMS; or
    (2) CMS's review of the State's survey findings.

[59 FR 56252, Nov. 10, 1994]



Sec.  498.5  Appeal rights.

    (a) Appeal rights of prospective providers. (1) Any prospective 
provider dissatisfied with an initial determination or revised initial 
determination that it does not qualify as a provider may request 
reconsideration in accordance with Sec.  498.22(a).
    (2) Any prospective provider dissatisfied with a reconsidered 
determination under paragraph (a)(1) of this section, or a revised 
reconsidered determination under Sec.  498.30, is entitled to a hearing 
before an ALJ.
    (b) Appeal rights of providers. Any provider dissatisfied with an 
initial determination to terminate its provider agreement is entitled to 
a hearing before an ALJ.
    (c) Appeal rights of providers and prospective providers. Any 
provider or prospective provider dissatisfied with a hearing decision 
may request Departmental Appeals Board review, and has

[[Page 648]]

a right to seek judicial review of the Board's decision.
    (d) Appeal rights of prospective suppliers. (1) Any prospective 
supplier dissatisfied with an initial determination or a revised initial 
determination that its services do not meet the conditions for coverage 
may request reconsideration in accordance with Sec.  498.22(a).
    (2) Any prospective supplier dissatisfied with a reconsidered 
determination under paragraph (d)(1) of this section, or a revised 
reconsidered determination under Sec.  498.30, is entitled to a hearing 
before an ALJ.
    (e) Appeal rights of suppliers. Any supplier dissatisfied with an 
initial determination that the services subject to the determination no 
longer meet the conditions for coverage, is entitled to a hearing before 
an ALJ.
    (f) Appeal rights of suppliers and prospective suppliers. (1) Any 
supplier or prospective supplier dissatisfied with the hearing decision 
may request Departmental Appeals Board review of the ALJ's decision.
    (2) A supplier or prospective supplier dissatisfied with an ALJ 
decision may request Board review, and has a right to seek judicial 
review of the Board's decision.
    (g) Appeal rights for certain practitioners. A physical therapist in 
independent practice or a chiropractor dissatisfied with a determination 
that he or she does not meet the requirements for coverage of his or her 
services has the same appeal rights as suppliers have under paragraphs 
(d), (e) and (f) of this section.
    (h) Appeal rights for nonparticipating hospitals that furnish 
emergency services. A nonparticipating hospital dissatisfied with a 
determination or decision that it does not qualify to elect to claim 
payment for all emergency services furnished during a calendar year has 
the same appeal rights that providers have under paragraph (a), (b), and 
(c) of this section.
    (i) Appeal rights for suspended or excluded practitioners, 
providers, or suppliers. (1) Any practitioner, provider, or supplier who 
has been suspended, or whose services have been excluded from coverage 
in accordance with Sec.  498.3(c)(2), or has been sanctioned in 
accordance with Sec.  498.3(c)(3), is entitled to a hearing before an 
ALJ.
    (2) Any suspended or excluded practitioner, provider, or supplier 
dissatisfied with a hearing decision may request Departmental Appeals 
Board review and has a right to seek judicial review of the Board's 
decision by filing an action in Federal district court.
    (j) Appeal rights for Medicaid ICFs/MR terminated by CMS. (1) Any 
Medicaid ICF/MR that has had its approval cancelled by CMS in accordance 
with Sec.  498.3(b)(8) has a right to a hearing before an ALJ, to 
request Departmental Appeals Board review of the hearing decision, and 
to seek judicial review of the Board's decision.
    (2) The Medicaid agreement remains in effect until the period for 
requesting a hearing has expired or, if the facility requests a hearing, 
until a hearing decision is issued, unless CMS--
    (i) Makes a written determination that continuation of provider 
status for the SNF or ICF constitutes an immediate and serious threat to 
the health and safety of patients and specifies the reasons for that 
determination; and
    (ii) Certifies that the facility has been notified of its 
deficiencies and has failed to correct them.
    (k) Appeal rights of NFs. Under the circumstances specified in Sec.  
431.153 (g) and (h) of this chapter, an NF has a right to a hearing 
before an ALJ, to request Board review of the hearing decision, and to 
seek judicial review of the Board's decision.
    (l) Appeal rights related to provider enrollment. 1) Any prospective 
provider, an existing provider, prospective supplier or existing 
supplier dissatisfied with an initial determination or revised initial 
determination related to the denial or revocation of Medicare billing 
privileges may request reconsideration in accordance with Sec.  
498.22(a).
    (2) CMS, a CMS contractor, any prospective provider, an existing 
provider, prospective supplier, or existing supplier dissatisfied with a 
reconsidered determination under paragraph (l)(1) of this section, or a 
revised reconsidered determination under Sec.  498.30, is entitled to a 
hearing before an ALJ.
    (3) CMS, a CMS contractor, any prospective provider, an existing 
provider,

[[Page 649]]

prospective supplier, or existing supplier dissatisfied with a hearing 
decision may request Board review, and any prospective provider, an 
existing provider, prospective supplier, or existing supplier has a 
right to seek judicial review of the Board's decision.

[52 FR 22446, June 12, 1987, as amended at 57 FR 43925, Sept. 23, 1992; 
59 FR 56252, Nov. 10, 1994; 61 FR 32350, June 24, 1996; 73 FR 36462, 
June 27, 2008]



Sec.  498.10  Appointment of representatives.

    (a) An affected party may appoint as its representative anyone not 
disqualified or suspended from acting as a representative in proceedings 
before the Secretary or otherwise prohibited by law.
    (b) If the representative appointed is not an attorney, the party 
must file written notice of the appointment with CMS, the ALJ, or the 
Departmental Appeals Board.
    (c) If the representative appointed is an attorney, the attorney's 
statement that he or she has the authority to represent the party is 
sufficient.



Sec.  498.11  Authority of representatives.

    (a) A representative appointed and qualified in accordance with 
Sec.  498.10 may, on behalf of the represented party--
    (1) Give and accept any notice or request pertinent to the 
proceedings set forth in this part;
    (2) Present evidence and allegations as to facts and law in any 
proceedings affecting that party to the same extent as the party; and
    (3) Obtain information to the same extent as the party.
    (b) A notice or request may be sent to the affected party, to the 
party's representative, or to both. A notice or request sent to the 
representative has the same force and effect as if it had been sent to 
the party.



Sec.  498.13  Fees for services of representatives.

    Fees for any services performed on behalf of an affected party by an 
attorney appointed and qualified in accordance with Sec.  498.10 are not 
subject to the provisions of section 206 of Title II of the Act, which 
authorizes the Secretary to specify or limit those fees.



Sec.  498.15  Charge for transcripts.

    A party that requests a transcript of prehearing or hearing 
proceedings or Board review must pay the actual or estimated cost of 
preparing the transcript unless, for good cause shown by that party, the 
payment is waived by the ALJ or the Departmental Appeals Board, as 
appropriate.

[52 FR 22446, June 12, 1987, as amended at 61 FR 51021, Sept. 30, 1996]



Sec.  498.17  Filing of briefs with the ALJ or Departmental Appeals Board, and opportunity for rebuttal.

    (a) Filing of briefs and related documents. If a party files a brief 
or related document such as a written argument, contention, suggested 
finding of fact, conclusion of law, or any other written statement, it 
must submit an original and one copy to the ALJ or the Departmental 
Appeals Board, as appropriate. The material may be filed by mail or in 
person and must include a statement certifying that a copy has been 
furnished to the other party.
    (b) Opportunity for rebuttal. (1) The other party will have 20 days 
from the date of mailing or personal service to submit any rebuttal 
statement or additional evidence. If a party submits a rebuttal 
statement or additional evidence, it must file an original and one copy 
with the ALJ or the Board and furnish a copy to the other party.
    (2) The ALJ or the Board will grant an opportunity to reply to the 
rebuttal statement only if the party shows good cause.



       Subpart B_Initial, Reconsidered, and Revised Determinations



Sec.  498.20  Notice and effect of initial determinations.

    (a) Notice of initial determination--(1) General rule. CMS or the 
OIG, as appropriate, mails notice of an initial determination to the 
affected party, setting forth the basis or reasons for the 
determination, the effect of the determination, and the party's right to 
reconsideration, if applicable, or to a hearing.

[[Page 650]]

    (2) Special rules: Independent laboratories and suppliers of 
portable x-ray services. If CMS determines that an independent 
laboratory or a supplier of portable x-ray services no longer meets the 
conditions for coverage of some or all of its services, the notice--
    (i) Specifies an effective date of termination of coverage that is 
at least 15 days after the date of the notice;
    (ii) Is also sent to physicians, hospitals, and other parties that 
might use the services of the laboratory or supplier; and
    (iii) In the case of laboratories, specifies the categories of 
laboratory tests that are no longer covered.
    (3) Special rules: Nonparticipating hospitals that elect to claim 
payment for emergency services. If CMS determines that a 
nonparticipating hospital no longer qualifies to elect to claim payment 
for all emergency services furnished in a calendar year, the notice--
    (i) States the calendar year to which the determination applies;
    (ii) Specifies an effective date that is at least 5 days after the 
date of the notice; and
    (iii) Specifies that the determination applies to services 
furnished, in the specified calendar year, to patients accepted (as 
inpatients or outpatients) on or after the effective date of the 
determination.
    (4) Other special rules. Additional rules pertaining, for example, 
to content and timing of notice, notice to the public and to other 
entities, and time allowed for submittal of additional information, are 
set forth elsewhere in this chapter, as follows:

Part 405 Subpart X--for rural health clinics.
Part 416--for ambulatory surgical centers.
Part 489--for providers, when their provider agreements have been 
terminated.
Part 1001, Subpart B--for excluded or suspended providers, suppliers, 
physicians, or practitioners.
Part 1001, Subpart C--for providers, when their provider agreements are 
terminated by the OIG.
Part 1004--for sanctioned providers and practitioners.

    (b) Effect of initial determination. An initial determination is 
binding unless it is--
    (1) Reconsidered in accordance with Sec.  498.24;
    (2) Reversed or modified by a hearing decision in accordance with 
Sec.  498.78; or
    (3) Revised in accordance with Sec.  498.32 or Sec.  498.100.



Sec.  498.22  Reconsideration.

    (a) Right to reconsideration. CMS or one of its contractors 
reconsiders an initial determination that affects a prospective provider 
or supplier, or a hospital seeking to qualify to claim payment for all 
emergency hospital services furnished in a calendar year, if the 
affected party files a written request in accordance with paragraphs (b) 
and (c) of this section. For denial or revocation of enrollment, 
prospective providers and suppliers and providers and suppliers have a 
right to reconsideration.
    (b) Request for reconsideration: Manner and timing. The affected 
party specified in paragraph (a) of this section, if dissatisfied with 
the initial determination may request reconsideration by filing the 
request--
    (1) With CMS or with the State survey agency, or in the case of 
prospective supplier the entity specified in the notice of initial 
determination;
    (2) Directly or through its legal representative or other authorized 
official; and
    (3) Within 60 days from receipt of the notice of initial 
determination, unless the time is extended in accordance with paragraph 
(d) of this section. The date of receipt will be presumed to be 5 days 
after the date on the notice unless there is a showing that it was, in 
fact, received earlier or later.
    (c) Content of request. The request for reconsideration must state 
the issues, or the findings of fact with which the affected party 
disagrees, and the reasons for disagreement.
    (d) Extension of time to file a request for reconsideration. (1) If 
the affected party is unable to file the request within the 60 days 
specified in paragraph (b) of this section, it may file a written 
request with CMS, stating the reasons why the request was not filed 
timely.
    (2) CMS will extend the time for filing a request for 
reconsideration if the affected party shows good cause for missing the 
deadline.

[52 FR 22446, June 12, 1987, as amended at 73 FR 36462, June 27, 2008]

[[Page 651]]



Sec.  498.23  Withdrawal of request for reconsideration.

    A request for reconsideration is considered withdrawn if the 
requestor files a written withdrawal request before CMS mails the notice 
of reconsidered determination, and CMS approves the withdrawal request.



Sec.  498.24  Reconsidered determination.

    When a request for reconsideration has been properly filed in 
accordance with Sec.  498.22, CMS--
    (a) Receives written evidence and statements that are relevant and 
material to the matters at issue and are submitted within a reasonable 
time after the request for reconsideration;
    (b) Considers the initial determination, the findings on which the 
initial determination was based, the evidence considered in making the 
initial determination, and any other written evidence submitted under 
paragraph (a) of this section, taking into account facts relating to the 
status of the prospective provider or supplier subsequent to the initial 
determination; and
    (c) Makes a reconsidered determination, affirming or modifying the 
initial determination and the findings on which it was based.



Sec.  498.25  Notice and effect of reconsidered determination.

    (a) Notice. (1) CMS mails notice of a reconsidered determination to 
the affected party.
    (2) The notice gives the reasons for the determination.
    (3) If the determination is adverse, the notice specifies the 
conditions or requirements of law or regulations that the affected party 
fails to meet, and informs the party of its right to a hearing.
    (b) Effect. A reconsidered determination is binding unless--
    (1) CMS or the OIG, as appropriate, further revises the revised 
determination; or
    (2) The revised determination is reversed or modified by a hearing 
decision.



      Subpart C_Reopening of Initial or Reconsidered Determinations



Sec.  498.30  Limitation on reopening.

    An initial or reconsidered determination that a prospective provider 
is a provider or that a hospital qualifies to elect to claim payment for 
all emergency services furnished in a calendar year may not be reopened. 
CMS or the OIG, as appropriate, may on its own initiative, reopen any 
other initial or reconsidered determination, within 12 months after the 
date of notice of the initial determination.



Sec.  498.32  Notice and effect of reopening and revision.

    (a) Notice. (1) CMS or the OIG, as appropriate, gives the affected 
party notice of reopening and of any revision of the reopened 
determination.
    (2) The notice of revised determination states the basis or reason 
for the revised determination.
    (3) If the determination is that a supplier or prospective supplier 
does not meet the conditions for coverage of its services, the notice 
specifies the conditions with respect to which the affected party fails 
to meet the requirements of law and regulations, and informs the party 
of its right to a hearing.
    (b) Effect. A revised determination is binding unless
    (1) The affected party requests a hearing before an ALJ; or
    (2) CMS or the OIG further revises the revised determination.



                           Subpart D_Hearings



Sec.  498.40  Request for hearing.

    (a) Manner and timing of request. (1) An affected party entitled to 
a hearing under Sec.  498.5 may file a request for a hearing with the 
ALJ office identified in the determination letter.
    (2) The affected party or its legal representative or other 
authorized official must file the request in writing within 60 days from 
receipt of the notice of initial, reconsidered, or revised determination 
unless that period is extended in accordance with paragraph (c) of this 
section. (Presumed date of receipt

[[Page 652]]

is determined in accordance with Sec.  498.22(b)(3)).
    (b) Content of request for hearing. The request for hearing must--
    (1) Identify the specific issues, and the findings of fact and 
conclusions of law with which the affected party disagrees; and
    (2) Specify the basis for contending that the findings and 
conclusions are incorrect.
    (c) Extension of time for filing a request for hearing. If the 
request was not filed within 60 days--
    (1) The affected party or its legal representative or other 
authorized official may file with the ALJ a written request for 
extension of time stating the reasons why the request was not filed 
timely.
    (2) For good cause shown, the ALJ may extend the time for filing the 
request for hearing.

[52 FR 22446, June 12, 1987, as amended at 73 FR 36462, June 27, 2008]



Sec.  498.42  Parties to the hearing.

    The parties to the hearing are the affected party and CMS or the 
OIG, as appropriate.



Sec.  498.44  Designation of hearing official.

    (a) The Secretary or his or her delegate designates an ALJ or a 
member or members of the Board to conduct hearings.
    (b) If appropriate, the Secretary or the delegate may designate 
another ALJ or another member or other members of the Board to conduct 
the hearing.
    (c) As used in this part, ``ALJ'' includes any ALJ of the Department 
of Health and Human Services or members of the Board who are designated 
to conduct a hearing.

[73 FR 36462, June 27, 2008]



Sec.  498.45  Disqualification of Administrative Law Judge.

    (a) An ALJ may not conduct a hearing in a case in which he or she is 
prejudiced or partial to the affected party or has any interest in the 
matter pending for decision.
    (b) A party that objects to the ALJ designated to conduct the 
hearing must give notice of its objections at the earliest opportunity.
    (c) The ALJ will consider the objections and decide whether to 
withdraw or proceed with the hearing.
    (1) If the ALJ withdraws, another will be designated to conduct the 
hearing.
    (2) If the ALJ does not withdraw, the objecting party may, after the 
hearing, present its objections to the Departmental Appeals Board as 
reasons for changing, modifying, or reversing the ALJ's decision or 
providing a new hearing before another ALJ.



Sec.  498.47  Prehearing conference.

    (a) At any time before the hearing, the ALJ may call a prehearing 
conference for the purpose of delineating the issues in controversy, 
identifying the evidence and witnesses to be presented at the hearing, 
and obtaining stipulations accordingly.
    (b) On the request of either party or on his or her own motion, the 
ALJ may adjourn the prehearing conference and reconvene at a later date.



Sec.  498.48  Notice of prehearing conference.

    (a) Timing of notice. The ALJ will fix a time and place for the 
prehearing conference and mail written notice to the parties at least 10 
days before the scheduled date.
    (b) Content of notice. The notice will inform the parties of the 
purpose of the conference and specify what issues are sought to be 
resolved, agreed to, or excluded.
    (c) Additional issues. Issues other than those set forth in the 
notice of determination or the request for hearing may be considered at 
the prehearing conference if--
    (1) Either party gives timely notice to that effect to the ALJ and 
the other party; or
    (2) The ALJ raises the issues in the notice of prehearing conference 
or at the conference.



Sec.  498.49  Conduct of prehearing conference.

    (a) The prehearing conference is open to the affected party or its 
representative, to the CMS or OIG representatives and their technical 
advisors, and

[[Page 653]]

to any other persons whose presence the ALJ considers necessary or 
proper.
    (b) The ALJ may accept the agreement of the parties as to the 
following:
    (1) Facts that are not in controversy.
    (2) Questions that have been resolved favorably to the affected 
party after the determination in dispute.
    (3) Remaining issues to be resolved.
    (c) The ALJ may request the parties to indicate the following:
    (1) The witnesses that will be present to testify at the hearing.
    (2) The qualifications of those witnesses.
    (3) The nature of other evidence to be submitted.



Sec.  498.50  Record, order, and effect of prehearing conference.

    (a) Record of prehearing conference. (1) A record is made of all 
agreements and stipulations entered into at the prehearing conference.
    (2) The record may be transcribed at the request of either party or 
the ALJ.
    (b) Order and opportunity to object. (1) The ALJ issues an order 
setting forth the results of the prehearing conference, including the 
agreements made by the parties as to facts not in controversy, the 
matters to be considered at the hearing, and the issues to be resolved.
    (2) Copies of the order are sent to all parties and the parties have 
10 days to file objections to the order.
    (3) After the 10 days have elapsed, the ALJ settles the order.
    (c) Effect of prehearing conference. The agreements and stipulations 
entered into at the prehearing conference are binding on all parties, 
unless a party presents facts that, in the opinion of the ALJ, would 
make an agreement unreasonable or inequitable.



Sec.  498.52  Time and place of hearing.

    (a) The ALJ fixes a time and place for the hearing and gives the 
parties written notice at least 10 days before the scheduled date.
    (b) The notice informs the parties of the general and specific 
issues to be resolved at the hearing.



Sec.  498.53  Change in time and place of hearing.

    (a) The ALJ may change the time and place for the hearing either on 
his or her own initiative or at the request of a party for good cause 
shown, or may adjourn or postpone the hearing.
    (b) The ALJ may reopen the hearing for receipt of new evidence at 
any time before mailing the notice of hearing decision.
    (c) The ALJ gives the parties reasonable notice of any change in 
time or place or any adjournment or reopening of the hearing.



Sec.  498.54  Joint hearings.

    When two or more affected parties have requested hearings and the 
same or substantially similar matters are at issue, the ALJ may, if all 
parties agree, fix a single time and place for the prehearing conference 
or hearing and conduct all proceedings jointly. If joint hearings are 
held, a single record of the preceedings is made and a separate decision 
issued with respect to each affected party.



Sec.  498.56  Hearing on new issues.

    (a) Basic rules. (1) Within the time limits specified in paragraph 
(b) of this section, the ALJ may, at the request of either party, or on 
his or her own motion, provide a hearing on new issues that impinge on 
the rights of the affected party.
    (2) Except for provider or supplier enrollment appeals which are 
addressed in Sec.  498.56(e), the ALJ may consider new issues even if 
CMS or the OIG has not made initial or reconsidered determinations on 
them, and even if they arose after the request for hearing was filed or 
after the prehearing conference.
    (3) The ALJ may give notice of hearing on new issues at any time 
after the hearing request is filed and before the hearing record is 
closed.
    (b) Time limits. The ALJ will not consider any issue that arose on 
or after any of the following dates:
    (1) The effective date of the termination of a provider agreement.
    (2) The date on which it is determined that a supplier no longer 
meets the conditions for coverage of its services.

[[Page 654]]

    (3) The effective date of the notice to a hospital of its failure to 
remain in compliance with the qualifications for claiming reimbursement 
for all emergency services furnished to Medicare beneficiaries during 
the calendar year.
    (4) The effective date of the suspension, or of the exclusion from 
coverage of services furnished by a suspended or excluded practitioner, 
provider, or supplier.
    (5) With respect to Medicaid SNFs or ICFs surveyed under section 
1910(c) of the Act--
    (i) The completion date of the survey or resurvey that is the basis 
for a proposed cancellation of approval; or
    (ii) If approval was cancelled before the hearings, because of 
immediate and serious threat to patient health and safety, the effective 
date of cancellation.
    (c) Notice and conduct of hearing on new issues. (1) Unless the 
affected party waives its right to appear and present evidence, notice 
of the time and place of hearing on any new issue will be given to the 
parties in accordance with Sec.  498.52.
    (2) After giving notice, the ALJ will, except as provided in 
paragraph (d) of this section, proceed to hearing on new issues in the 
same manner as on an issue raised in the request for hearing.
    (d) Remand to CMS or the OIG. At the request of either party, or on 
his or her own motion, in lieu of a hearing under paragraph (c) of this 
section, the ALJ may remand the case to CMS or the OIG for consideration 
of the new issue and, if appropriate, a determination. If necessary, the 
ALJ may direct CMS or the OIG to return the case to the ALJ for further 
proceedings.
    (e) Provider and supplier enrollment appeals: Good cause 
requirement--(1) Examination of any new documentary evidence. After a 
hearing is requested but before it is held, the ALJ will examine any new 
documentary evidence submitted to the ALJ by a provider or supplier to 
determine whether the provider or supplier has good cause for submitting 
the evidence for the first time at the ALJ level.
    (2) Determining if good cause exists.--(i) If good cause exists. If 
the ALJ finds that there is good cause for submitting new documentary 
evidence for the first time at the ALJ level, the ALJ must include 
evidence and may consider it in reaching a decision.
    (ii) If good cause does not exist. If the ALJ determines that there 
was not good cause for submitting the evidence for the first time at the 
ALJ level, the ALJ must exclude the evidence from the proceeding and may 
not consider it in reaching a decision.
    (2) Notification to all parties. As soon as possible, but no later 
than the start of the hearing, the ALJ must notify all parties of any 
evidence that is excluded from the hearing.

[52 FR 22446, June 12, 1987, as amended at 53 FR 31335, Aug. 18, 1988; 
73 FR 36463, June 27, 2008]



Sec.  498.58  Subpoenas.

    (a) Basis for issuance. The ALJ, upon his or her own motion or at 
the request of a party, may issue subpoenas if they are reasonably 
necessary for the full presentation of a case.
    (b) Timing of request by a party. The party must file a written 
request for a subpoena with the ALJ at least 5 days before the date set 
for the hearing.
    (c) Content of request. The request must:
    (1) Identify the witnesses or documents to be produced;
    (2) Describe their addresses or location with sufficient 
particularity to permit them to be found; and
    (3) Specify the pertinent facts the party expects to establish by 
the witnesses or documents, and indicate why those facts could not be 
established without use of a subpoena.
    (d) Method of issuance. Subpoenas are issued in the name of the 
Secretary, who pays the cost of issuance and the fees and mileage of any 
subpoenaed witnesses.



Sec.  498.60  Conduct of hearing.

    (a) Participants in the hearing. The hearing is open to the parties 
and their representatives and technical advisors, and to any other 
persons whose presence the ALJ considers necessary or proper.
    (b) Hearing procedures. (1) The ALJ inquires fully into all of the 
matters at issue, and receives in evidence the testimony of witnesses 
and any documents that are relevant and material.

[[Page 655]]

    (2) If the ALJ believes that there is relevant and material evidence 
available which has not been presented at the hearing, he may, at any 
time before mailing of notice of the decision, reopen the hearing to 
receive that evidence.
    (3) The ALJ decides the order in which the evidence and the 
arguments of the parties are presented and the conduct of the hearing.
    (c) Scope of review: Civil money penalty. In civil money penalty 
cases--
    (1) The scope of review is as specified in Sec.  488.438(e) of this 
chapter; and
    (2) CMS's determination as to the level of noncompliance of an SNF 
or NF must be upheld unless it is clearly erroneous.

[52 FR 22446, June 12, 1987, as amended at 61 FR 32350, June 24, 1996]



Sec.  498.61  Evidence.

    Evidence may be received at the hearing even though inadmissible 
under the rules of evidence applicable to court procedure. The ALJ rules 
on the admissibility of evidence.

[59 FR 56252, Nov. 10, 1994, as amended at 61 FR 32350, June 24, 1996]



Sec.  498.62  Witnesses.

    Witnesses at the hearing testify under oath or affirmation. The 
representative of each party is permitted to examine his or her own 
witnesses subject to interrogation by the representative of the other 
party. The ALJ may ask any questions that he or she deems necessary. The 
ALJ rules upon any objection made by either party as to the propriety of 
any question.



Sec.  498.63  Oral and written summation.

    The parties to a hearing are allowed a reasonable time to present 
oral summation and to file briefs or other written statements of 
proposed findings of fact and conclusions of law. Copies of any briefs 
or other written statements must be sent in accordance with Sec.  
498.17.



Sec.  498.64  Record of hearing.

    A complete record of the proceedings at the hearing is made and 
transcribed in all cases.



Sec.  498.66  Waiver of right to appear and present evidence.

    (a) Waiver procedures. (1) If an affected party wishes to waive its 
right to appear and present evidence at the hearing, it must file a 
written waiver with the ALJ.
    (2) If the affected party wishes to withdraw a waiver, it may do so, 
for good cause, at any time before the ALJ mails notice of the hearing 
decision.
    (b) Effect of waiver. If the affected party waives the right to 
appear and present evidence, the ALJ need not conduct an oral hearing 
except in one of the following circumstances:
    (1) The ALJ believes that the testimony of the affected party or its 
representatives or other witnesses is necessary to clarify the facts at 
issue.
    (2) CMS or the OIG shows good cause for requiring the presentation 
of oral evidence.
    (c) Dismissal for failure to appear. If, despite the waiver, the ALJ 
sends notice of hearing and the affected party fails to appear, or to 
show good cause for the failure, the ALJ will dismiss the appeal in 
accordance with Sec.  498.69.
    (d) Hearing without oral testimony. When there is no oral testimony, 
the ALJ will--
    (1) Make a record of the relevant written evidence that was 
considered in making the determination being appealed, and of any 
additional evidence submitted by the parties;
    (2) Furnish to each party copies of the additional evidence 
submitted by the other party; and
    (3) Give both parties a reasonable opportunity for rebuttal.
    (e) Handling of briefs and related statements. If the parties submit 
briefs or other written statements of evidence or proposed findings of 
facts or conclusions of law, those documents will be handled in 
accordance with Sec.  498.17.



Sec.  498.68  Dismissal of request for hearing.

    (a) The ALJ may, at any time before mailing the notice of the 
decision, dismiss a hearing request if a party withdraws its request for 
a hearing or the affected party asks that its request be dismissed.

[[Page 656]]

    (b) An affected party may request a dismissal by filing a written 
notice with the ALJ.



Sec.  498.69  Dismissal for abandonment.

    (a) The ALJ may dismiss a request for hearing if it is abandoned by 
the party that requested it.
    (b) The ALJ may consider a request for hearing to be abandoned if 
the party or its representative--
    (1) Fails to appear at the prehearing conference or hearing without 
having previously shown good cause for not appearing; and
    (2) Fails to respond, within 10 days after the ALJ sends a ``show 
cause'' notice, with a showing of good cause.



Sec.  498.70  Dismissal for cause.

    On his or her own motion, or on the motion of a party to the 
hearing, the ALJ may dismiss a hearing request either entirely or as to 
any stated issue, under any of the following circumstances:
    (a) Res judicata. There has been a previous determination or 
decision with respect to the rights of the same affected party on the 
same facts and law pertinent to the same issue or issues which has 
become final either by judicial affirmance or, without judicial 
consideration, because the affected party did not timely request 
reconsideration, hearing, or review, or commence a civil action with 
respect to that determination or decision.
    (b) No right to hearing. The party requesting a hearing is not a 
proper party or does not otherwise have a right to a hearing.
    (c) Hearing request not timely filed. The affected party did not 
file a hearing request timely and the time for filing has not been 
extended.



Sec.  498.71  Notice and effect of dismissal and right to request review.

    (a) Notice of the ALJ's dismissal action is mailed to the parties. 
The notice advises the affected party of its right to request that the 
dismissal be vacated as provided in Sec.  498.72.
    (b) The dismissal of a request for hearing is binding unless it is 
vacated by the ALJ or the Departmental Appeals Board.



Sec.  498.72  Vacating a dismissal of request for hearing.

    An ALJ may vacate any dismissal of a request for hearing if a party 
files a request to that effect within 60 days from receipt of the notice 
of dismissal and shows good cause for vacating the dismissal. (Date of 
receipt is determined in accordance with Sec.  498.22(b)(3).)



Sec.  498.74  Administrative Law Judge's decision.

    (a) Timing, basis and content. As soon as practical after the close 
of the hearing, the ALJ issues a written decision in the case. The 
decision is based on the evidence of record and contains separate 
numbered findings of fact and conclusions of law.
    (b) Notice and effect. A copy of the decision is mailed to the 
parties and is binding on them unless--
    (1) A party requests review by the Departmental Appeals Board within 
the time period specified in Sec.  498.82, and the Board reviews the 
case;
    (2) The Departmental Appeals Board denies the request for review and 
the party seeks judicial review by filing an action in a United States 
District Court or, in the case of a civil money penalty, in a United 
States Court of Appeals;
    (3) The decision is revised by an ALJ or the Departmental Appeals 
Board; or
    (4) The decision is a recommended decision directed to the Board.

[52 FR 22446, June 12, 1987, as amended at 61 FR 32351, June 24, 1996]



Sec.  498.76  Removal of hearing to Departmental Appeals Board.

    (a) At any time before the ALJ receives oral testimony, the Board 
may remove to itself any pending request for a hearing.
    (b) Notice of removal is mailed to each party.
    (c) The Board conducts the hearing in accordance with the rules that 
apply to ALJ hearings under this subpart.



Sec.  498.78  Remand by the Administrative Law Judge.

    (a) If CMS requests a remand, the ALJ may remand any case properly 
before him or her to CMS.

[[Page 657]]

    (b) The ALJ may remand at any time before notice of hearing decision 
is mailed.

[52 FR 22446, June 12, 1987, as amended at 73 FR 36463, June 27, 2008]



Sec.  498.79  Timeframes for deciding an enrollment appeal before an ALJ.

    When a request for an ALJ hearing is filed after CMS or a FFS 
contractor has denied an enrollment application, the ALJ must issue a 
decision, dismissal order or remand to CMS, as appropriate, no later 
than the end of the 180-day period beginning from the date the appeal 
was filed with an ALJ.

[73 FR 36463, June 27, 2008]



               Subpart E_Departmental Appeals Board Review



Sec.  498.80  Right to request Departmental Appeals Board review of Administrative Law Judge's decision or dismissal.

    Either of the parties has a right to request Departmental Appeals 
Board review of the ALJ's decision or dismissal order, and the parties 
are so informed in the notice of the ALJ's action.



Sec.  498.82  Request for Departmental Appeals Board review.

    (a) Manner and time of filing. (1) Any party that is dissatisfied 
with an ALJ's decision or dismissal of a hearing request, may file a 
written request for review by the Departmental Appeals Board.
    (2) The requesting party or its representative or other authorized 
official must file the request with the OHA within 60 days from receipt 
of the notice of decision or dismissal, unless the Board, for good cause 
shown by the requesting party, extends the time for filing. The rules 
set forth in Sec.  498.40(c) apply to extension of time for requesting 
Departmental Appeals Board review. (The date of receipt of notice is 
determined in accordance with Sec.  498.22(c)(3).)
    (b) Content of request for review. A request for review of an ALJ 
decision or dismissal must specify the issues, the findings of fact or 
conclusions of law with which the party disagrees, and the basis for 
contending that the findings and conclusions are incorrect.



Sec.  498.83  Departmental Appeals Board action on request for review.

    (a) Request by CMS or the OIG. The Departmental Appeals Board may 
dismiss, deny, or grant a request made by CMS or the OIG for review of 
an ALJ decision or dismissal.
    (b) Request by the affected party. The Board will grant the affected 
party's request for review unless it dismisses the request for one of 
the following reasons:
    (1) The affected party requests dismissal of its request for review.
    (2) The affected party did not file timely or show good cause for 
late filing.
    (3) The affected party does not have a right to review.
    (4) A previous determination or decision, based on the same facts 
and law, and regarding the same issue, has become final through judicial 
affirmance or because the affected party failed to timely request 
reconsideration, hearing, Board review, or judicial review, as 
appropriate.
    (c) Effect of dismissal. The dismissal of a request for Departmental 
Appeals Board review is binding and not subject to further review.
    (d) Review panel. If the Board grants a request for review of the 
ALJ's decision, the review will be conducted by a panel of at least two 
members of the Board, designated by the Chairperson or Deputy 
Chairperson, and one individual designated by the Secretary from the U.S 
Public Health Service.



Sec.  498.85  Procedures before the Departmental Appeals Board on review.

    The parties are given, upon request, a reasonable opportunity to 
file briefs or other written statements as to fact and law, and to 
appear before the Departmental Appeals Board to present evidence or oral 
arguments. Copies of any brief or other written statement must be sent 
in accordance with Sec.  498.17.



Sec.  498.86  Evidence admissible on review.

    (a) Except for provider or supplier enrollment appeals, the Board 
may admit evidence into the record in addition to

[[Page 658]]

the evidence introduced at the ALJ hearing (or the documents considered 
by the ALJ if the hearing was waived) if the Board considers that the 
additional evidence is relevant and material to an issue before it.
    (b) If it appears to the Board that additional relevant evidence is 
available, the Board will require that it be produced.
    (c) Before additional evidence is admitted into the record--
    (1) Notice is mailed to the parties (unless they have waived notice) 
stating that evidence will be received regarding specified issues; and
    (2) The parties are given a reasonable time to comment and to 
present other evidence pertinent to the specified issues.
    (d) If additional evidence is presented orally to the Board, a 
transcript is prepared and made available to any party upon request.

[52 FR 22446, June 12, 1987, as amended at 73 FR 36463, June 27, 2008]



Sec.  498.88  Decision or remand by the Departmental Appeals Board.

    (a) When the Departmental Appeals Board reviews an ALJ's decision or 
order of dismissal, or receives a case remanded by a court, the Board 
may either issue a decision or remand the case to an ALJ for a hearing 
and decision or a recommended decision for final decision by the Board.
    (b) In a remanded case, the ALJ initiates additional proceedings and 
takes other actions as directed by the Board in its order of remand, and 
may take other action not inconsistent with that order.
    (c) Upon completion of all action called for by the remand order and 
any other consistent action, the ALJ promptly makes a decision or, as 
specified by the Board, certifies the case to the Board with a 
recommended decision.
    (d) The parties have 20 days from the date of a notice of a 
recommended decision to submit to the Board any exception, objection, or 
comment on the findings of fact, conclusions of law, and recommended 
decision.
    (e) After the 20-day period, the Board issues its decision adopting, 
modifying or rejecting the ALJ's recommended decision.
    (f) If the Board does not remand the case to an ALJ, the following 
rules apply:
    (1) The Board's decision--
    (i) Is based upon the evidence in the hearing record and any further 
evidence that the Board receives during its review;
    (ii) Is in writing and contains separate numbered findings of fact 
and conclusions of law; and
    (iii) May modify, affirm, or reverse the ALJ's decision.
    (2) A copy of the Board's decision is mailed to each party.
    (g) When a request for Board review of a denial of an enrollment 
application is filed after an ALJ has issued a decision or dismissal 
order, the Board must issue a decision, dismissal order or remand to the 
ALJ, as appropriate, no later than 180 days after the appeal was 
received by the Board.

[52 FR 22446, June 12, 1987, as amended at 73 FR 36463, June 27, 2008]



Sec.  498.90  Effect of Departmental Appeals Board decision.

    (a) General rule. The Board's decision is binding unless--
    (1) The affected party has a right to judicial review and timely 
files a civil action in a United States District Court or, in the case 
of a civil money penalty, in a United States Court of Appeals; or
    (2) The Board reopens and revises its decision in accordance with 
Sec.  498.102.
    (b) Right to judicial review. Section 498.5 specifies the 
circumstances under which an affected party has a right to seek judicial 
review.
    (c) Special rules: Civil money penalty--(1) Finality of Board's 
decision. When CMS imposes a civil money penalty, notice of the Board's 
decision (or denial of review) is the final administrative action that 
initiates the 60-day period for seeking judicial review.
    (2) Timing for collection of civil money penalty. For SNFs and NFs, 
the rules that apply are those set forth in subpart F of part 488 of 
this chapter.

[61 FR 32351, June 24, 1996]

[[Page 659]]



Sec.  498.95  Extension of time for seeking judicial review.

    (a) Any affected party that is dissatisfied with an Departmental 
Appeals Board decision and is entitled to judicial review must commence 
civil action within 60 days from receipt of the notice of the Board's 
decision (as determined under Sec.  498.22(c)(3)), unless the Board 
extends the time in accordance with paragraph (c) of this section.
    (b) The request for extension must be filed in writing with the 
Board before the 60-day period ends.
    (c) For good cause shown, the Board may extend the time for 
commencing civil action.



 Subpart F_Reopening of Decisions Made by Administrative Law Judges or 
                     the Departmental Appeals Board



Sec.  498.100  Basis, timing, and authority for reopening an ALJ or Board decision.

    (a) Basis and timing for reopening. An ALJ of Departmental Appeals 
Board decision may be reopened, within 60 days from the date of the 
notice of decision, upon the motion of the ALJ or the Board or upon the 
petition of either party to the hearing.
    (b) Authority to reopen. (1) A decision of the Departmental Appeals 
Board may be reopened only by the Departmental Appeals Board.
    (2) A decision of an ALJ may be reopened by that ALJ, by another ALJ 
if that one is not available, or by the Departmental Appeals Board. For 
purposes of this paragraph, an ALJ is considered to be unavailable if 
the ALJ has died, terminated employment, or been transferred to another 
duty station, is on leave of absence, or is unable to conduct a hearing 
because of illness.



Sec.  498.102  Revision of reopened decision.

    (a) Revision based on new evidence. If a reopened decision is to be 
revised on the basis of new evidence that was not included in the record 
of that decision, the ALJ or the Departmental Appeals Board--
    (1) Notifies the parties of the proposed revision; and
    (2) Unless the parties waive their right to hearing or appearance--
    (i) Grants a hearing in the case of an ALJ revision; and
    (ii) Grants opportunity to appear in the case of a Board revision.
    (b) Basis for revised decision and right to review. (1) If a revised 
decision is necessary, the ALJ or the Departmental Appeals Board, as 
appropriate, renders it on the basis of the entire record.
    (2) If the decision is revised by an ALJ, the Departmental Appeals 
Board may review that revised decision at the request of either party or 
on its own motion.



Sec.  498.103  Notice and effect of revised decision.

    (a) Notice. The notice mailed to the parties states the basis or 
reason for the revised decision and informs them of their right to 
Departmental Appeals Board review of an ALJ revised decision, or to 
judicial review of a Board reviewed decision.
    (b) Effect--(1) ALJ revised decision. An ALJ revised decision is 
binding unless it is reviewed by the Departmental Appeals Board.
    (2) Departmental Appeals Board revised decision. A Board revised 
decision is binding unless a party files a civil action in a district 
court of the United States within the time frames specified in Sec.  
498.95.

[[Page 660]]



       SUBCHAPTER H_HEALTH CARE INFRASTRUCTURE IMPROVEMENT PROGRAM





PART 505_ESTABLISHMENT OF THE HEALTH CARE INFRASTRUCTURE IMPROVEMENT PROGRAM--Table of Contents




                         Subpart A_Loan Criteria

Sec.
505.1 Basis and scope.
505.3 Definitions.
505.5 Loan criteria.
505.7 Terms of the loan.
505.9 State and local permits.
505.11 Loan application requirements and procedures.

                  Subpart B_Forgiveness of Indebtedness

505.13 Conditions for loan forgiveness.
505.15 Plan criteria for meeting the conditions for loan forgiveness.
505.17 Reporting requirements for meeting the conditions for loan 
          forgiveness.
505.19 Approval or denial of loan forgiveness.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 U.S.C 
1302 and 1395hh).

    Source: 70 FR 57374, Sept. 30, 2005, unless otherwise noted.



                         Subpart A_Loan Criteria



Sec.  505.1  Basis and scope.

    This part implements section 1016 of the Medicare Prescription Drug, 
Improvement and Modernization Act of 2003 (MMA) which amends section 
1897 of the Act. Section 1897 of the Act as amended by section 6045 of 
the Tsunami Relief Act of 2005 authorizes the Secretary to establish a 
loan program by which qualifying hospitals may apply for a loan for the 
capital costs of the health care infrastructure improvement projects. 
Section 1897 of the Act appropriates $142,000,000 for the loan program 
including program administration. The funds are available beginning July 
1, 2004 through September 30, 2008. This part sets forth the criteria 
that CMS uses to select among qualifying hospitals.



Sec.  505.3  Definitions.

    For purposes of this subpart, the following definitions apply:
    Eligible project means the project of a qualifying hospital that is 
designed to improve the health care infrastructure of the hospital, 
including construction, renovation, or other capital improvements.
    Entity is an entity described in section 501(c)(3) of the Internal 
Revenue Code of 1986 and exempt from tax under section 501(a) of the 
code. An entity must also have at least one existing memorandum of 
understanding or affiliation agreement with a hospital located in the 
State in which the entity is located and retains clinical outpatient 
treatment for cancer on site as well as laboratory research, education, 
and outreach for cancer in the same facility.
    Outreach programs mean formal cancer programs for teaching, 
diagnostic screening, therapy or treatment, prevention, or interventions 
to enhance the health and knowledge of their designated population(s).
    Qualifying hospital means a hospital as defined at section 1861(e) 
of the Act (42 U.S,C. 1395x(e)) or an entity (as defined in this 
section) that is engaged in research in the causes, prevention, and 
treatment of cancer; and is either designated as a cancer center for the 
National Cancer Institute; or designated by the State legislature as the 
official cancer institute of the State before December 8, 2003.
    Unique research resources means resources that are used for the 
purpose of discovering or testing options related to the causes, 
prevention, and treatment of cancer.

[70 FR 57374, Sept. 30, 2005, as amended at 71 FR 48143, Aug. 18, 2006]



Sec.  505.5  Loan criteria.

    (a) Qualifying criteria. To qualify for the loan program, the 
applicant must meet the following conditions:
    (1) Meet the definition of a ``qualifying hospital'' as set forth in 
Sec.  505.3 of this part.
    (2) Request a loan for the capital costs of an ``eligible project'' 
as defined in Sec.  505.3 of this part. The capital costs

[[Page 661]]

for which a qualifying hospital may obtain a loan are limited to the 
reasonable costs incurred by the hospital, and capitalized on the 
Medicare cost report, for any facility or item of equipment that it has 
acquired the possession or use of at the time the loan funding is 
awarded.
    (b) Selection criteria. In selecting loan recipients, CMS 
prioritizes qualifying hospitals that meet the following criteria:
    (1) The hospital is located in a State that, based on population 
density, is defined as a rural State. A rural State is one of ten States 
with the lowest population density. An applicant entity is required to 
be located in one of these ten States. The ten States are prioritized 
beginning with the State with the lowest population density. Population 
density is determined based on the most recent available U.S. Census 
Bureau data.
    (2) The hospital is located in a State with multiple Indian tribes 
in the State. After prioritizing based on paragraph (b)(1) of this 
section, States are further prioritized based on the States with the 
most Indian tribes. The number of Indian tribes in a State is based on 
the most recent data available published in ``Indian Entities Recognized 
and Eligible to Receive Services from the United State Bureau of Indian 
Affairs.'' (68 FR 68180) published on December 5, 2003.
    (c) CMS will send written notice to qualifying hospitals that have 
been selected to participate in the loan program under this part.



Sec.  505.7  Terms of the loan.

    All loan recipients must agree to the following loan terms:
    (a) Loan obligation. An authorized official of a qualifying hospital 
must execute a promissory note, loan agreement, or a form approved by 
CMS and accompanied by any other documents CMS may designate. The loan 
recipient must provide required documentation in a timely manner.
    (b) Schedule of loan. A loan recipient receives a lump sum 
distribution for which payment of principal and interest is deferred for 
60 months beginning with the day of award notification from CMS. The 
loan repayment period is 20 years.
    (c) Bankruptcy protection. In the event a loan recipient files for 
bankruptcy protection in a court of competent jurisdiction or otherwise 
proves to be insolvent, CMS may terminate the deferment period described 
in paragraph (b) of this section and require immediate payment of the 
loan. If a loan recipient should file for bankruptcy protection in a 
court of competent jurisdiction or should otherwise evidence insolvency 
after the deferment period we will require immediate repayment of the 
outstanding principal and interest due. Those payments may be deducted 
from any Medicare payments otherwise due that hospital.
    (d) Loan forgiveness. CMS does not require a loan recipient to begin 
making payments of principal or interest at the end of the 60-month 
deferment period if it determines that the loan recipient meets the 
criteria for loan forgiveness under section 1897 of the Act, as 
determined by the Secretary.
    (e) Default. If a loan recipient fails to make any payment in 
repayment of a loan under this subpart within 10 days of its due date, 
the loan recipient may be considered to have defaulted on the loan. Upon 
default, all principal and accrued interest become due immediately, and 
CMS may require immediate payment of any outstanding principal and 
interest due. Those payments may be deducted from any Medicare payments 
otherwise due that hospital.
    (f) Loan repayment. The loan recipient must meet the following 
conditions:
    (1) Make payments every month for 20 years until the loan, including 
interest payments, are paid in full.
    (2) Pay interest on the unpaid principal until the full amount of 
principal has been paid.
    (3) Pay interest at a yearly rate based upon the rate as fixed by 
the Secretary of the Treasury and set forth at 45 CFR 30.13(a).
    (4) If a loan recipient fails to make any payment in repayment of a 
loan under this subpart within 10 days of its due date, that payment may 
be deducted from any Medicare payments otherwise due to the recipient.

[[Page 662]]

    (g) Interest rate and monthly payment charges. CMS calculates 
interest charges and payments consistent with Sec.  405.378 of this 
chapter.
    (h) Loan recipient's right to prepay. A loan recipient has the right 
to make payments of principal at any time before they are due. A loan 
recipient may make full prepayment or partial prepayment without paying 
any prepayment charge. If a prepayment is made, the loan recipient must 
provide written notice to CMS at CMS, Division of Accounting Operations, 
P.O. Box 75120, Baltimore, MD 21207-0520.



Sec.  505.9  State and local permits.

    With respect to an eligible project, the provision of a loan under 
this part shall not--
    (a) Relieve the recipient of the loan or any obligation to obtain 
any required State or local permit or approval with respect to the 
project.
    (b) Limit the right of any unit of State or local government to 
approve or regulate any rate of return on private equity invested in the 
project.
    (c) Supersede any State or local law (including any regulation) 
applicable to the construction or operation of the project.



Sec.  505.11  Loan application requirements and procedures.

    (a) The loan application must be received by CMS no later than 5 
p.m. e.d.t. on December 29, 2005.
    (b) The requested information must be typed or clearly printed in 
ink and the loan recipient must mail or deliver an original copy of the 
loan to CMS. The loan application must contain the following 
information:
    (1) Qualifying hospital's name and street address.
    (2) Qualifying hospital's Medicare provider number.
    (3) Name, title, and telephone number of a contact person submitting 
the application.
    (4) Provide all appropriate supporting documentation for each answer 
made on the loan application.



                  Subpart B_Forgiveness of Indebtedness

    Source: 71 FR 48144, Aug. 18, 2006, unless otherwise noted.



Sec.  505.13  Conditions for loan forgiveness.

    The Secretary may forgive a loan provided under this part if the 
qualifying hospital--
    (a) Has been selected to participate in the loan program specified 
in Sec.  505.5(c).
    (b) Has established the following in accordance with a plan that 
meets the criteria specified in Sec.  505.15:
    (1) An outreach program for cancer prevention, early diagnosis, and 
treatment that provides services to a substantial majority of the 
residents of a State or region, including residents of rural areas;
    (2) An outreach program for cancer prevention, early diagnosis, and 
treatment that provides services to multiple Indian tribes; and
    (3) Unique research resources (such as population databases) or an 
affiliation with an entity that has unique research resources.
    (c) Submits to CMS, within the timeframe specified by the Secretary, 
a--
    (1) Written request for loan forgiveness; and
    (2) Loan forgiveness plan that meets the criteria specified in Sec.  
505.15 of this subpart.



Sec.  505.15  Plan criteria for meeting the conditions for loan forgiveness.

    The qualifying hospital requesting loan forgiveness must submit to 
CMS a plan specifying how it will develop, implement, or maintain an 
existing outreach program for cancer prevention, early diagnosis, and 
treatment for a substantial majority of the residents of a State or 
region, including residents of rural areas and for multiple Indian 
tribes and specifying how the qualifying hospital will establish or 
maintain existing unique research resources or an affiliation with an 
entity that has unique research resources.
    (a) Outreach programs. The initial plan must specify how the 
hospital will establish or develop, implement, or

[[Page 663]]

maintain existing outreach programs. The plan must--
    (1) Address cancer prevention for cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for decreasing the targeted cancer 
rates during the loan deferment program; and
    (2) Address early diagnosis of cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for improving early diagnosis rates 
for the targeted cancer(s) during the loan deferment period;
    (3) Address cancer treatment for cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for improving cancer treatment rates 
for the targeted cancer(s) during the loan deferment; and
    (4) Identify the measures that will be used to determine the 
qualifying hospital's annual progress in meeting the initial goals 
specified in paragraphs (a)(1) through (a)(3) of this section.
    (b) Unique research resources. The plan must specify how the 
qualifying hospital will establish or maintain existing unique research 
resources or an affiliation with an entity that has unique research 
resources.



Sec.  505.17  Reporting requirements for meeting the conditions for loan forgiveness.

    (a) Annual reporting requirements. On an annual basis, beginning one 
year from the date that CMS notified the qualifying hospital of the loan 
award, the qualifying hospital must submit a report to CMS that updates 
the plan specified in Sec.  505.15 by--
    (1) Describing the qualifying hospital's progress in meeting its 
initial plan goals;
    (2) Describing any changes to the qualifying hospital's initial plan 
goals; and
    (3) Including at least one measure used to track the qualifying 
hospital's progress in meeting its plan goals.
    (b) Review of annual reports. CMS will review each qualifying 
hospital's annual report to provide the hospital with feedback regarding 
its loan forgiveness status. If CMS determines that the annual report 
shows that the qualifying hospital has fulfilled the conditions, plan 
criteria, and reporting requirements for loan forgiveness specified in 
Sec. Sec.  505.13, 505.15, and Sec.  505.17, CMS will notify the 
qualifying hospital in writing that the loan is forgiven.
    (c) Final annual reporting requirements. A qualifying hospital must 
submit its final report to CMS at least 6 months before the end of the 
loan deferment period specified in Sec.  505.7(b).



Sec.  505.19  Approval or denial of loan forgiveness.

    (a) Approval of loan forgiveness. If CMS determines that a 
qualifying hospital has met the conditions, plan criteria, and reporting 
requirements for loan forgiveness specified in Sec.  505.13, Sec.  
505.15, and Sec.  505.17, CMS will send a written notification of 
approval for loan forgiveness to the qualifying hospital by the earlier 
of--
    (1) 30 days from the date of receipt of the annual report that shows 
the qualifying hospital has satisfied the requirements for loan 
forgiveness; or
    (2) 90 days before the end of the loan deferment period defined in 
Sec.  505.7(b).
    (b) Denial of loan forgiveness. If CMS determines that a qualifying 
hospital has not met the conditions, plan criteria, or reporting 
requirements for loan forgiveness specified in Sec.  505.13, Sec.  
505.15, or Sec.  505.17 of this part, CMS will send a written 
notification of denial of loan forgiveness to the qualifying hospital at 
least 30 days before the end of the loan deferment period defined in 
Sec.  505.7(b).

[[Page 665]]



CHAPTER V--OFFICE OF INSPECTOR GENERAL-HEALTH CARE, DEPARTMENT OF HEALTH 
                           AND HUMAN SERVICES




  --------------------------------------------------------------------


  Editorial Note: Nomenclature changes to chapter V appear at 66 FR 
39452, July 31, 2001, and 67 FR 36540, May 24, 2002.

                    SUBCHAPTER A--GENERAL PROVISIONS
Part                                                                Page
1000            Introduction; General definitions...........         667
                      SUBCHAPTER B--OIG AUTHORITIES
1001            Program integrity--Medicare and State health 
                    care programs...........................         670
1002            Program integrity--State-initiated 
                    exclusions from Medicaid................         719
1003            Civil money penalties, assessments and 
                    exclusions..............................         721
1004            Imposition of sanctions on health care 
                    practitioners and providers of health 
                    care services by a Quality Improvement 
                    Organization............................         737
1005            Appeals of exclusions, civil money penalties 
                    and assessments.........................         746
1006            Investigational inquiries...................         755
1007            State Medicaid fraud control units..........         756
1008            Advisory opinions by the OIG................         761

[[Page 667]]



                     SUBCHAPTER A_GENERAL PROVISIONS





PART 1000_INTRODUCTION; GENERAL DEFINITIONS--Table of Contents




Subpart A [Reserved]

                          Subpart B_Definitions

Sec.
1000.10 General definitions.
1000.20 Definitions specific to Medicare.
1000.30 Definitions specific to Medicaid.

    Authority: 42 U.S.C. 1320 and 1395hh.

    Source: 51 FR 34766, Sept. 30, 1986, unless otherwise noted.

Subpart A [Reserved]



                          Subpart B_Definitions



Sec.  1000.10  General definitions.

    In this chapter, unless the context indicates otherwise--
    Act means the Social Security Act, and titles referred to are titles 
of that Act.
    Administrator means the Administrator, Centers for Medicare & 
Medicaid Services (CMS), formerly the Health Care Financing 
Administration (HCFA).
    Beneficiary means any individual eligible to have benefits paid to 
him or her, or on his or her behalf, under Medicare or any State health 
care program.
    CFR stands for Code of Federal Regulations.
    CMS stands for Centers for Medicare & Medicaid Services, formerly 
the Health Care Financing Administration (HCFA).
    Department means the Department of Health and Human Services (HHS), 
formerly the Department of Health, Education, and Welfare.
    Directly, as used in the definition of ``furnished'' in this 
section, means the provision of items and services by individuals or 
entities (including items and services provided by them, but 
manufactured, ordered or prescribed by another individual or entity) who 
submit claims to Medicare, Medicaid or other Federal health care 
programs.
    ESRD stands for end-stage renal disease.
    FR stands for Federal Register.
    Furnished refers to items or services provided or supplied, directly 
or indirectly, by any individual or entity. This includes items and 
services manufactured, distributed or otherwise provided by individuals 
or entities that do not directly submit claims to Medicare, Medicaid or 
other Federal health care programs, but that supply items or services to 
providers, practitioners or suppliers who submit claims to these 
programs for such items or services.
    HHS stands for the Department of Health and Human Services.
    HHA stands for home health agency.
    HMO stands for health maintenance organization.
    ICF stands for intermediate care facility.
    Indirectly, as used in the definition of ``furnished'' in this 
section, means the provision of items and services manufactured, 
distributed or otherwise supplied by individuals or entities who do not 
directly submit claims to Medicare, Medicaid or other Federal health 
care programs, but that provide items and services to providers, 
practitioners or suppliers who submit claims to these programs for such 
items and services. This term does not include individuals and entities 
that submit claims directly to these programs for items and services 
ordered or prescribed by another individual or entity.
    Inspector General means the Inspector General for Health and Human 
Services.
    Medicaid means medical assistance provided under a State plan 
approved under Title XIX of the Act.
    Medicare means the health insurance program for the aged and 
disabled under Title XVIII of the Act.
    OIG means the Office of Inspector General within HHS.
    QIO stands for Utilization and Quality Control Quality Improvement 
Organization.
    Secretary means the Secretary of Health and Human Services.

[[Page 668]]

    SNF stands for skilled nursing facility.
    Social security benefits means monthly cash benefits payable under 
section 202 or 223 of the Act.
    SSA stands for Social Security Administration.
    United States means the fifty States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa, 
and the Northern Mariana Islands.
    U.S.C. stands for United States Code.

[51 FR 34766, Sept. 30, 1986 as amended at 57 FR 3329, Jan. 29, 1992; 63 
FR 46685, Sept. 2, 1998; 66 FR 39452, July 31, 2001]



Sec.  1000.20  Definitions specific to Medicare.

    As used in connection with the Medicare program, unless the context 
indicates otherwise--
    Carrier means an entity that has a contract with CMS to determine 
and make Medicare payments for Part B benefits payable on a charge basis 
and to perform other related functions.
    Entitled means that an individual meets all the requirements for 
Medicare benefits.
    Hospital insurance benefits means payments on behalf of, and in rare 
circumstances directly to, an entitled individual for services that are 
covered under Part A of Title XVIII of the Act.
    Intermediary means an entity that has a contract with CMS to 
determine and make Medicare payments for Part A or Part B benefits 
payable on a cost basis and to perform other related functions.
    Medicare Part A means the hospital insurance program authorized 
under Part A of Title XVIII of the Act.
    Medicare Part B means the supplementary medical insurance program 
authorized under Part B of Title XVIII of the Act.
    Provider means a hospital, a skilled nursing facility, a 
comprehensive outpatient rehabilitation facility, a home health agency, 
or effective November 1, 1983 through September 30, 1986, a hospice that 
has in effect an agreement to participate in Medicare, or a clinic, a 
rehabilitation agency, or a public health agency that has a similar 
agreement but only to furnish outpatient physical therapy or speech 
pathology services.
    Railroad retirement benefits means monthly benefits payable to 
individuals under the Railroad Retirement Act of 1974 (45 U.S.C. 
beginning at section 231).
    Services means medical care or services and items, such as medical 
diagnosis and treatment, drugs and biologicals, supplies, appliances, 
and equipment, medical social services, and use of hospital or SNF 
facilities.
    Supplementary medical insurance benefits means payment to or on 
behalf of an entitled individual for services covered under Part B of 
Title XVIII of the Act.
    Supplier means a physician or other practitioner, or an entity other 
than a provider, that furnishes health care services under Medicare.

[51 FR 34766, Sept. 30, 1986, as amended at 57 FR 3329, Jan. 29, 1992]



Sec.  1000.30  Definitions specific to Medicaid.

    As used in connection with the Medicaid program, unless the context 
indicates otherwise--
    Applicant means an individual whose written application for Medicaid 
has been submitted to the agency determining Medicaid eligibility, but 
has not received final action. This includes an individual (who need not 
be alive at the time of application) whose application is submitted 
through a representative or a person acting responsibly for the 
individual.
    Federal financial participation (FFP) means the Federal Government's 
share of a State's expenditures under the Medicaid program.
    FMAP stands for the Federal medical assistance percentage, which is 
used to calculate the amount of Federal share of State expenditures for 
services.
    Medicaid agency or agency means the single State agency 
administering or supervising the administration of a State Medicaid 
plan.
    Provider means any individual or entity furnishing Medicaid services 
under a provider agreement with the Medicaid agency.
    Recipient means an individual who has been determined eligible for 
Medicaid.

[[Page 669]]

    Services means the types of medical assistance specified in sections 
1905(a)(1) through (18) of the Act.
    State means the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa 
and the Northern Mariana Islands.
    State plan or the plan means a comprehensive written commitment by a 
Medicaid agency, submitted under section 1902(a) of the Act, to 
administer or supervise the administration of a Medicaid program in 
accordance with Federal requirements.

[[Page 670]]



                      SUBCHAPTER B_OIG AUTHORITIES





PART 1001_PROGRAM INTEGRITY_MEDICARE AND STATE HEALTH CARE PROGRAMS--Table of Contents




                      Subpart A_General Provisions

Sec.
1001.1 Scope and purpose.
1001.2 Definitions.

                     Subpart B_Mandatory Exclusions

1001.101 Basis for liability.
1001.102 Length of exclusion.

                     Subpart C_Permissive Exclusions

1001.201 Conviction relating to program or health care fraud.
1001.301 Conviction relating to obstruction of an investigation.
1001.401 Conviction relating to controlled substances.
1001.501 License revocation or suspension.
1001.601 Exclusion or suspension under a Federal or State health care 
          program.
1001.701 Excessive claims or furnishing of unnecessary or substandard 
          items and services.
1001.801 Failure of HMOs and CMPs to furnish medically necessary items 
          and services.
1001.901 False or improper claims.
1001.951 Fraud and kickbacks and other prohibited activities.
1001.952 Exceptions.
1001.1001 Exclusion of entities owned or controlled by a sanctioned 
          person.
1001.1051 Exclusion of individuals with ownership or control interest in 
          sanctioned entities.
1001.1101 Failure to disclose certain information.
1001.1201 Failure to provide payment information.
1001.1301 Failure to grant immediate access.
1001.1401 Violations of PPS corrective action.
1001.1501 Default of health education loan or scholarship obligations.
1001.1601 Violations of the limitations on physician charges.
1001.1701 Billing for services of assistant at surgery during cataract 
          operations.

Appendix A to Subpart C of Part 1001

                Subpart D_Waivers and Effect of Exclusion

1001.1801 Waivers of exclusions.
1001.1901 Scope and effect of exclusion.

                      Subpart E_Notice and Appeals

1001.2001 Notice of intent to exclude.
1001.2002 Notice of exclusion.
1001.2003 Notice of proposal to exclude.
1001.2004 Notice to State agencies.
1001.2005 Notice to State licensing agencies.
1001.2006 Notice to others regarding exclusion.
1001.2007 Appeal of exclusions.

                Subpart F_Reinstatement into the Programs

1001.3001 Timing and method of request for reinstatement.
1001.3002 Basis for reinstatement.
1001.3003 Approval of request for reinstatement.
1001.3004 Denial of request for reinstatement.
1001.3005 Reversed or vacated decisions.

    Authority: 42 U.S.C. 1302, 1320a-7, 1320a-7b, 1395u(j), 1395u(k), 
1395w-104(e)(6), 1395y(d), 1395y(e), 1395cc(b)(2)(D), (E) and (F), and 
1395hh; and sec. 2455, Pub. L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 
note).

    Source: 57 FR 3330, Jan. 29, 1992, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  1001.1  Scope and purpose.

    (a) The regulations in this part specify certain bases upon which 
individuals and entities may, or in some cases must, be excluded from 
participation in Medicare, Medicaid and all other Federal health care 
programs. They also state the effect of exclusion, the factors that will 
be considered in determining the length of any exclusion, the provisions 
governing notices of exclusions, and the process by which an excluded 
individual or entity may seek reinstatement into the programs.
    (b) The regulations in this part are applicable to and binding on 
the Office of Inspector General (OIG) in imposing and proposing 
exclusions, as well as to Administrative Law Judges (ALJs), the 
Departmental Appeals Board (DAB), and federal courts in reviewing the 
imposition of exclusions by the OIG (and,

[[Page 671]]

where applicable, in imposing exclusions proposed by the OIG).

[57 FR 3330, Jan. 29, 1992, as amended at 58 FR 5618, Jan. 22, 1993; 64 
FR 39426, July 22, 1999]



Sec.  1001.2  Definitions.

    Controlled substance means a drug or other substance, or immediate 
precursor:
    (a) Included in schedules I, II, III, IV or V of part B of 
subchapter I in 21 U.S.C. chapter 13, or
    (b) That is deemed a controlled substance by the law of any State.
    Convicted means that--
    (a) A judgment of conviction has been entered against an individual 
or entity by a Federal, State or local court, regardless of whether:
    (1) There is a post-trial motion or an appeal pending, or
    (2) The judgment of conviction or other record relating to the 
criminal conduct has been expunged or otherwise removed;
    (b) A Federal, State or local court has made a finding of guilt 
against an individual or entity;
    (c) A Federal, State or local court has accepted a plea of guilty or 
nolo contendere by an individual or entity; or
    (d) An individual or entity has entered into participation in a 
first offender, deferred adjudication or other program or arrangement 
where judgment of conviction has been withheld.
    Exclusion means that items and services furnished, ordered or 
prescribed by a specified individual or entity will not be reimbursed 
under Medicare, Medicaid and all other Federal health care programs 
until the individual or entity is reinstated by the OIG.
    Federal health care program means any plan or program providing 
health care benefits, whether directly through insurance or otherwise, 
that is funded directly, in whole or part, by the United States 
Government (other than the Federal Employees Health Benefits Program), 
or any State health care program as defined in this section.
    HHS means Department of Health and Human Services.
    Incarceration means imprisonment or any type of confinement with or 
without supervised release, including, but not limited to, community 
confinement, house arrest and home detention.
    OIG means Office of Inspector General of the Department of Health 
and Human Services.
    Patient means any individual who is receiving health care items or 
services, including any item or service provided to meet his or her 
physical, mental or emotional needs or well-being (including a resident 
receiving care in a facility as described in part 483 of this chapter), 
whether or not reimbursed under Medicare, Medicaid and any other Federal 
health care program and regardless of the location in which such item or 
service is provided.
    QIO means Utilization and Quality Control Quality Improvement 
Organization as created by the Tax Equity and Fiscal Responsibility Act 
of 1982 (42 U.S.C. 1320c-3).
    Professionally recognized standards of health care are Statewide or 
national standards of care, whether in writing or not, that professional 
peers of the individual or entity whose provision of care is an issue, 
recognize as applying to those peers practicing or providing care within 
a State. When the Department has declared a treatment modality not to be 
safe and effective, practitioners who employ such a treatment modality 
will be deemed not to meet professionally recognized standards of health 
care. This definition will not be construed to mean that all other 
treatments meet professionally recognized standards.
    Sole community physician means a physician who is the only physician 
who provides primary care services to Federal or State health care 
program beneficiaries within a defined service area.
    Sole source of essential specialized services in the community means 
that an individual or entity--
    (1) Is the only practitioner, supplier or provider furnishing 
specialized services in an area designated by the Health Resources 
Services Administration as a health professional shortage area for that 
medical specialty, as listed in 42 part 5, appendices B-F;
    (2) Is a sole community hospital, as defined in Sec.  412.92 of this 
title; or

[[Page 672]]

    (3) Is the only source of specialized services in a reasonably 
defined service area where services by a non-specialist could not be 
substituted for the source without jeopardizing the health or safety of 
beneficiaries.
    State health care program means:
    (a) A State plan approved under title XIX of the Act (Medicaid),
    (b) Any program receiving funds under title V of the Act or from an 
allotment to a State under such title (Maternal and Child Health 
Services Block Grant program), or
    (c) Any program receiving funds under title XX of the Act or from 
any allotment to a State under such title (Block Grants to States for 
Social Services).
    State Medicaid Fraud Control Unit means a unit certified by the 
Secretary as meeting the criteria of 42 U.S.C. 1396b(q) and Sec.  
1002.305 of this chapter.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46686, Sept. 2, 1998; 64 
FR 39426, July 22, 1999]



                     Subpart B_Mandatory Exclusions



Sec.  1001.101  Basis for liability.

    The OIG will exclude any individual or entity that--
    (a) Has been convicted of a criminal offense related to the delivery 
of an item or service under Medicare or a State health care program, 
including the performance of management or administrative services 
relating to the delivery of items or services under any such program;
    (b) Has been convicted, under Federal or State law, of a criminal 
offense related to the neglect or abuse of a patient, in connection with 
the delivery of a health care item or service, including any offense 
that the OIG concludes entailed, or resulted in, neglect or abuse of 
patients (the delivery of a health care item or service includes the 
provision of any item or service to an individual to meet his or her 
physical, mental or emotional needs or well-being, whether or not 
reimbursed under Medicare, Medicaid or any Federal health care program);
    (c) Has been convicted, under Federal or State law, of a felony that 
occurred after August 21, 1996, relating to fraud, theft, embezzlement, 
breach of fiduciary responsibility, or other financial misconduct--
    (1) In connection with the delivery of a health care item or 
service, including the performance of management or administrative 
services relating to the delivery of such items or services, or
    (2) With respect to any act or omission in a health care program 
(other than Medicare and a State health care program) operated by, or 
financed in whole or in part, by any Federal, State or local government 
agency; or
    (d) Has been convicted, under Federal or State law, of a felony that 
occurred after August 21, 1996 relating to the unlawful manufacture, 
distribution, prescription or dispensing of a controlled substance, as 
defined under Federal or State law. This applies to any individual or 
entity that--
    (1) Is, or has ever been, a health care practitioner, provider or 
supplier;
    (2) Holds, or has held, a direct or indirect ownership or control 
interest (as defined in section 1124(a)(3) of the Act) in an entity that 
is a health care provider or supplier, or is, or has ever been, an 
officer, director, agent or managing employee (as defined in section 
1126(b) of the Act) of such an entity; or
    (3) Is, or has ever been, employed in any capacity in the health 
care industry.

[63 FR 46686, Sept. 2, 1998, as amended at 67 FR 11932, Mar. 18, 2002]



Sec.  1001.102  Length of exclusion.

    (a) No exclusion imposed in accordance with Sec.  1001.101 will be 
for less than 5 years.
    (b) Any of the following factors may be considered to be aggravating 
and a basis for lengthening the period of exclusion--
    (1) The acts resulting in the conviction, or similar acts, that 
caused, or were intended to cause, a financial loss to a Government 
program or to one or more entities of $5,000 or more. (The entire amount 
of financial loss to such programs or entities, including any amounts 
resulting from similar acts not adjudicated, will be considered 
regardless of whether full or partial restitution has been made);

[[Page 673]]

    (2) The acts that resulted in the conviction, or similar acts, were 
committed over a period of one year or more;
    (3) The acts that resulted in the conviction, or similar acts, had a 
significant adverse physical, mental or financial impact on one or more 
program beneficiaries or other individuals;
    (4) In convictions involving patient abuse or neglect, the action 
that resulted in the conviction was premeditated, was part of a 
continuing pattern of behavior, or consisted of non-consensual sexual 
acts;
    (5) The sentence imposed by the court included incarceration;
    (6) The convicted individual or entity has a prior criminal, civil 
or administrative sanction record;
    (7) The individual or entity has at any time been overpaid a total 
of $1,500 or more by Medicare, Medicaid or any other Federal health care 
programs as a result of intentional improper billings;
    (8) The individual or entity has previously been convicted of a 
criminal offense involving the same or similar circumstances; or
    (9) Whether the individual or entity was convicted of other offenses 
besides those which formed the basis for the exclusion, or has been the 
subject of any other adverse action by any Federal, State or local 
government agency or board, if the adverse action is based on the same 
set of circumstances that serves as the basis for imposition of the 
exclusion.
    (c) Only if any of the aggravating factors set forth in paragraph 
(b) of this section justifies an exclusion longer than 5 years, may 
mitigating factors be considered as a basis for reducing the period of 
exclusion to no less than 5 years. Only the following factors may be 
considered mitigating--
    (1) The individual or entity was convicted of 3 or fewer misdemeanor 
offenses, and the entire amount of financial loss (both actual loss and 
intended loss) to Medicare or any other Federal, State or local 
governmental health care program due to the acts that resulted in the 
conviction, and similar acts, is less than $1,500;
    (2) The record in the criminal proceedings, including sentencing 
documents, demonstrates that the court determined that the individual 
had a mental, emotional or physical condition before or during the 
commission of the offense that reduced the individual's culpability; or
    (3) The individual's or entity's cooperation with Federal or State 
officials resulted in--
    (i) Others being convicted or excluded from Medicare, Medicaid and 
all other Federal health care programs,
    (ii) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses, or
    (iii) The imposition against anyone of a civil money penalty or 
assessment under part 1003 of this chapter.
    (d) In the case of an exclusion under this subpart, based on a 
conviction occurring on or after August 5, 1997, an exclusion will be--
    (1) For not less than 10 years if the individual has been convicted 
on one other occasion of one or more offenses for which an exclusion may 
be effected under section 1128(a) of the Act (The aggravating and 
mitigating factors in paragraphs (b) and (c) of this section can be used 
to impose a period of time in excess of the 10-year mandatory 
exclusion); or
    (2) Permanent if the individual has been convicted on two or more 
other occasions of one or more offenses for which an exclusion may be 
effected under section 1128(a) of the Act.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46686, Sept. 2, 1998; 63 
FR 57918, Oct. 29, 1998; 64 FR 39426, July 22, 1999; 67 FR 11932, Mar. 
18, 2002]



                     Subpart C_Permissive Exclusions



Sec.  1001.201  Conviction relating to program or health care fraud.

    (a) Circumstance for exclusion. The OIG may exclude an individual or 
entity convicted under Federal or State law of--
    (1) A misdemeanor relating to fraud, theft, embezzlement, breach of 
fiduciary responsibility, or other financial misconduct--
    (i) In connection with the delivery of any health care item or 
service, including the performance of management or

[[Page 674]]

administrative services relating to the delivery of such items or 
services, or
    (ii) With respect to any act or omission in a health care program, 
other than Medicare and a State health care program, operated by, or 
financed in whole or in part by, any Federal, State or local government 
agency; or
    (2) Fraud, theft, embezzlement, breach of fiduciary responsibility, 
or other financial misconduct with respect to any act or omission in a 
program, other than a health care program, operated by or financed in 
whole or in part by any Federal, State or local government agency.
    (b) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will be for a period of 3 years, unless aggravating or 
mitigating factors listed in paragraphs (b)(2) and (b)(3) of this 
section form a basis for lengthening or shortening that period.
    (2) Any of the following factors may be considered to be aggravating 
and a basis for lengthening the period of exclusion--
    (i) The acts resulting in the conviction, or similar acts that 
caused, or reasonably could have been expected to cause, a financial 
loss of $5,000 or more to a Government program or to one or more other 
entities, or had a significant financial impact on program beneficiaries 
or other individuals. (The total amount of financial loss will be 
considered, including any amounts resulting from similar acts not 
adjudicated, regardless of whether full or partial restitution has been 
made);
    (ii) The acts that resulted in the conviction, or similar acts, were 
committed over a period of one year or more;
    (iii) The acts that resulted in the conviction, or similar acts, had 
a significant adverse physical or mental impact on one or more program 
beneficiaries or other individuals;
    (iv) The sentence imposed by the court included incarceration;
    (v) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing; or
    (vi) Whether the individual or entity was convicted of other 
offenses besides those which formed the basis for the exclusion, or has 
been the subject of any other adverse action by any Federal, State or 
local government agency or board, if the adverse action is based on the 
same set of circumstances that serves as the basis for the imposition of 
the exclusion.
    (3) Only the following factors may be considered as mitigating and a 
basis for reducing the period of exclusion--
    (i) The individual or entity was convicted of 3 or fewer offenses, 
and the entire amount of financial loss (both actual loss and reasonably 
expected loss) to a Government program or to other individuals or 
entities due to the acts that resulted in the conviction and similar 
acts is less than $1,500;
    (ii) The record in the criminal proceedings, including sentencing 
documents, demonstrates that the court determined that the individual 
had a mental, emotional or physical condition, before or during the 
commission of the offense, that reduced the individual's culpability;
    (iii) The individual's or entity's cooperation with Federal or State 
officials resulted in--
    (A) Others being convicted or excluded from Medicare, Medicaid or 
any of the other Federal health care programs, or
    (B) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses, or
    (C) The imposition of a civil money penalty against others; or
    (iv) Alternative sources of the type of health care items or 
services furnished by the individual or entity are not available.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46687, Sept. 2, 1998; 64 
FR 39426, July 22, 1999; 67 FR 11932, Mar. 18, 2002; 67 FR 21579, May 1, 
2002]



Sec.  1001.301  Conviction relating to obstruction of an investigation.

    (a) Circumstance for exclusion. The OIG may exclude an individual or 
entity that has been convicted, under Federal or State law, in 
connection with the interference with or obstruction of any 
investigation into any criminal offense described in Sec. Sec.  1001.101 
or 1001.201.
    (b) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will be for a period of 3 years,

[[Page 675]]

unless aggravating or mitigating factors listed in paragraphs (b)(2) and 
(b)(3) of this section form the basis for lengthening or shortening that 
period.
    (2) Any of the following factors may be considered to be aggravating 
and a basis for lengthening the period of exclusion--
    (i) The interference with, or obstruction of, the investigation 
caused the expenditure of significant additional time or resources;
    (ii) The interference or obstruction had a significant adverse 
mental, physical or financial impact on program beneficiaries or other 
individuals or on the Medicare, Medicaid or other Federal health care 
programs;
    (iii) The interference or obstruction also affected a civil or 
administrative investigation;
    (iv) The sentence imposed by the court included incarceration;
    (v) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing; or
    (vi) Whether the individual or entity was convicted of other 
offenses besides those which formed the basis for the exclusion, or has 
been the subject of any other adverse action by any Federal, State or 
local government agency or board, if the adverse action is based on the 
same set of circumstances that serves as the basis for the imposition of 
the exclusion.
    (3) Only the following factors may be considered as mitigating and a 
basis for reducing the period of exclusion--
    (i) The record of the criminal proceedings, including sentencing 
documents, demonstrates that the court determined that the individual 
had a mental, emotional or physical condition, before or during the 
commission of the offense, that reduced the individual's culpability;
    (ii) The individual's or entity's cooperation with Federal or State 
officials resulted in--
    (A) Others being convicted or excluded from Medicare, Medicaid and 
all other Federal health care programs,
    (B) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses, or
    (C) The imposition of a civil money penalty against others; or
    (iii) Alternative sources of the type of health care items or 
services furnished by the individual or entity are not available.

[57 FR 3329, Jan. 29, 1992; 57 FR 9669, Mar. 20, 1992; 63 FR 46687, 
Sept. 2, 1998; 64 FR 39426, July 22, 1999]



Sec.  1001.401  Conviction relating to controlled substances.

    (a) Circumstance for exclusion. The OIG may exclude an individual or 
entity convicted under Federal or State law of a misdemeanor relating to 
the unlawful manufacture, distribution, prescription or dispensing of a 
controlled substance, as defined under Federal or State law. This 
section applies to any individual or entity that--
    (1) Is, or has ever been, a health care practitioner, provider or 
supplier;
    (2) Holds or has held a direct or indirect ownership or control 
interest, as defined in section 1124(a)(3) of the Act, in an entity that 
is a health care provider or supplier, or is or has been an officer, 
director, agent or managing employee, as defined in section 1126(b) of 
the Act, of such an entity; or
    (3) Is, or has ever been, employed in any capacity in the health 
care industry.
    (b) For purposes of this section, the definition of controlled 
substance will be the definition that applies to the law forming the 
basis for the conviction.
    (c) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will be for a period of 3 years, unless aggravating or 
mitigating factors listed in paragraphs (b)(2) and (b)(3) of this 
section form a basis for lengthening or shortening that period.
    (2) Any of the following factors may be considered to be aggravating 
and a basis for lengthening the period of exclusion--
    (i) The acts that resulted in the conviction or similar acts were 
committed over a period of one year or more;
    (ii) The acts that resulted in the conviction or similar acts had a 
significant adverse mental, physical or financial impact on program 
beneficiaries or other individuals or the Medicare, Medicaid or other 
Federal health care programs;

[[Page 676]]

    (iii) The sentence imposed by the court included incarceration;
    (iv) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing; or
    (v) Whether the individual or entity was convicted of other offenses 
besides those which formed the basis for the exclusion, or has been the 
subject of any other adverse action by any other Federal, State or local 
government agency or board, if the adverse action is based on the same 
set of circumstances that serves as the basis for the imposition of the 
exclusion.
    (3) Only the following factors may be considered as mitigating and a 
basis for shortening the period of exclusion--
    (i) The individual's or entity's cooperation with Federal or State 
officials resulted in--
    (A) Others being convicted or excluded from Medicare, Medicaid and 
all other Federal health care programs,
    (B) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses, or
    (C) The imposition of a civil money penalty against others; or
    (ii) Alternative sources of the type of health care items or 
services furnished by the individual or entity are not available.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46687, Sept. 2, 1998; 64 
FR 39426, July 22, 1999]



Sec.  1001.501  License revocation or suspension.

    (a) Circumstance for exclusion. The OIG may exclude an individual or 
entity that has--
    (1) Had a license to provide health care revoked or suspended by any 
State licensing authority, or has otherwise lost such a license 
(including the right to apply for or renew such a license), for reasons 
bearing on the individual's or entity's professional competence, 
professional performance or financial integrity; or
    (2) Has surrendered such a license while a formal disciplinary 
proceeding concerning the individual's or entity's professional 
competence, professional performance or financial integrity was pending 
before a State licensing authority.
    (b) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will not be for a period of time less than the period 
during which an individual's or entity's license is revoked, suspended 
or otherwise not in effect as a result of, or in connection with, a 
State licensing agency action.
    (2) Any of the following factors may be considered aggravating and a 
basis for lengthening the period of exclusion--
    (i) The acts that resulted in the revocation, suspension or loss of 
the individual's or entity's license to provide health care had or could 
have had a significant adverse physical, emotional or financial impact 
on one or more program beneficiaries or other individuals;
    (ii) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing;
    (iii) The acts, or similar acts, had or could have had a significant 
adverse impact on the financial integrity of the programs; or
    (iv) The individual or entity has been the subject of any other 
adverse action by any other Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion.
    (3) Only if any of the aggravating factors listed in paragraph 
(b)(2) of this section justifies a longer exclusion may mitigating 
factors be considered as a basis for reducing the period of exclusion to 
a period not less than that set forth in paragraph (b)(1) of this 
section. Only the following factors may be considered mitigating--
    (i) The individual's or entity's cooperation with a State licensing 
authority resulted in--
    (A) The sanctioning of other individuals or entities, or
    (B) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses; or
    (ii) Alternative sources of the type of health care items or 
services furnished by the individual or entity are not available.

[[Page 677]]

    (4) When an individual or entity has been excluded under this 
section, the OIG will consider a request for reinstatement in accordance 
with Sec.  1001.3001 if the individual or entity obtains a valid license 
in the State where the license was originally revoked, suspended, 
surrendered or otherwise lost.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46688, Sept. 2, 1998]



Sec.  1001.601  Exclusion or suspension under a Federal or State health care program.

    (a) Circumstance for exclusion. (1) The OIG may exclude an 
individual or entity suspended or excluded from participation, or 
otherwise sanctioned, under--
    (i) Any Federal program involving the provision of health care, or
    (ii) A State health care program, for reasons bearing on the 
individual's or entity's professional competence, professional 
performance or financial integrity.
    (2) The term ``or otherwise sanctioned'' in paragraph (a)(1) of this 
section is intended to cover all actions that limit the ability of a 
person to participate in the program at issue regardless of what such an 
action is called, and includes situations where an individual or entity 
voluntarily withdraws from a program to avoid a formal sanction.
    (b) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will not be for a period of time less than the period 
during which the individual or entity is excluded or suspended from a 
Federal or State health care program.
    (2) Any of the following factors may be considered aggravating and a 
basis for lengthening the period of exclusion--
    (i) The acts that resulted in the exclusion, suspension or other 
sanction under Medicare, Medicaid and all other Federal health care 
programs had, or could have had, a significant adverse impact on Federal 
or State health care programs or the beneficiaries of those programs or 
other individuals;
    (ii) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing; or
    (iii) The individual or entity has been the subject of any other 
adverse action by any Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion.
    (3) Only if any of the aggravating factors set forth in paragraph 
(b)(2) of this section justifies a longer exclusion may mitigating 
factors be considered as a basis for reducing the period of exclusion to 
a period not less than that set forth in paragraph (b)(1) of this 
section. Only the following factors may be considered mitigating--
    (i) The individual's or entity's cooperation with Federal or State 
officials resulted in--
    (A) The sanctioning of other individuals or entities, or
    (B) Additional cases being investigated or reports being issued by 
the appropriate law enforcement agency identifying program 
vulnerabilities or weaknesses; or
    (ii) Alternative sources of the types of health care items or 
services furnished by the individual or entity are not available.
    (4) If the individual or entity is eligible to apply for 
reinstatement in accordance with Sec.  1001.3001 of this part, and the 
sole reason for the State denying reinstatement is the existing Medicare 
exclusion imposed by the OIG as a result of the original State action, 
the OIG will consider a request for reinstatement.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46688, Sept. 2, 1998]



Sec.  1001.701  Excessive claims or furnishing of unnecessary or substandard items and services.

    (a) Circumstance for exclusion. The OIG may exclude an individual or 
entity that has--
    (1) Submitted, or caused to be submitted, bills or requests for 
payments under Medicare or any of the State health care programs 
containing charges or costs for items or services furnished that are 
substantially in excess of such individual's or entity's usual charges 
or costs for such items or services; or

[[Page 678]]

    (2) Furnished, or caused to be furnished, to patients (whether or 
not covered by Medicare or any of the State health care programs) any 
items or services substantially in excess of the patient's needs, or of 
a quality that fails to meet professionally recognized standards of 
health care.
    (b) The OIG's determination under paragraph (a)(2) of this section--
that the items or services furnished were excessive or of unacceptable 
quality--will be made on the basis of information, including sanction 
reports, from the following sources:
    (1) The QIO for the area served by the individual or entity;
    (2) State or local licensing or certification authorities;
    (3) Fiscal agents or contractors, or private insurance companies;
    (4) State or local professional societies; or
    (5) Any other sources deemed appropriate by the OIG.
    (c) Exceptions. An individual or entity will not be excluded for--
    (1) Submitting, or causing to be submitted, bills or requests for 
payment that contain charges or costs substantially in excess of usual 
charges or costs when such charges or costs are due to unusual 
circumstances or medical complications requiring additional time, 
effort, expense or other good cause; or
    (2) Furnishing, or causing to be furnished, items or services in 
excess of the needs of patients, when the items or services were ordered 
by a physician or other authorized individual, and the individual or 
entity furnishing the items or services was not in a position to 
determine medical necessity or to refuse to comply with the order of the 
physician or other authorized individual.
    (d) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will be for a period of 3 years, unless aggravating or 
mitigating factors set forth in paragraphs (d)(2) and (d)(3) of this 
section form a basis for lengthening or shortening the period. In no 
case may the period be shorter than 1 year for any exclusion taken in 
accordance with paragraph (a)(2) of this section.
    (2) Any of the following factors may be considered aggravating and a 
basis for lengthening the period of exclusion--
    (i) The violations were serious in nature, and occurred over a 
period of one year or more;
    (ii) The violations had a significant adverse physical, mental or 
financial impact on program beneficiaries or other individuals;
    (iii) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing;
    (iv) The violation resulted in financial loss to Medicare, Medicaid 
and all other Federal health care programs of $1,500 or more; or
    (v) The individual or entity has been the subject of any other 
adverse action by any Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion.
    (3) Only the following factors may be considered mitigating and a 
basis for reducing the period of exclusion--
    (i) There were few violations and they occurred over a short period 
of time; or
    (ii) Alternative sources of the type of health care items or 
services furnished by the individual or entity are not available.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46688, Sept. 2, 1998]



Sec.  1001.801  Failure of HMOs and CMPs to furnish medically necessary items and services.

    (a) Circumstances for exclusion. The OIG may exclude an entity--
    (1) That is a--
    (i) Health maintenance organization (HMO), as defined in section 
1903(m) of the Act, providing items or services under a State Medicaid 
Plan;
    (ii) Primary care case management system providing services, in 
accordance with a waiver approved under section 1915(b)(1) of the Act; 
or
    (iii) HMO or competitive medical plan providing items or services in 
accordance with a risk-sharing contract under section 1876 of the Act;
    (2) That has failed substantially to provide medically necessary 
items and services that are required under a plan,

[[Page 679]]

waiver or contract described in paragraph (a)(1) of this section to be 
provided to individuals covered by such plan, waiver or contract; and
    (3) Where such failure has adversely affected or has a substantial 
likelihood of adversely affecting covered individuals.
    (b) The OIG's determination under paragraph (a)(2) of this section--
that the medically necessary items and services required under law or 
contract were not provided--will be made on the basis of information, 
including sanction reports, from the following sources:
    (1) The QIO or other quality assurance organization under contract 
with a State Medicaid plan for the area served by the HMO or competitive 
medical plan;
    (2) State or local licensing or certification authorities;
    (3) Fiscal agents or contractors, or private insurance companies;
    (4) State or local professional societies;
    (5) CMS's HMO compliance office; or
    (6) Any other sources deemed appropriate by the OIG.
    (c) Length of exclusion. (1) An exclusion imposed in accordance with 
this section will be for a period of 3 years, unless aggravating or 
mitigating factors set forth in paragraphs (c)(2) and (c)(3) of this 
section form a basis for lengthening or shortening the period.
    (2) Any of the following factors may be considered aggravating and a 
basis for lengthening the period of exclusion--
    (i) The entity failed to provide a large number or a variety of 
items or services;
    (ii) The failures occurred over a lengthy period of time;
    (iii) The entity's failure to provide a necessary item or service 
that had or could have had a serious adverse effect;
    (iv) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing; or
    (v) The individual or entity has been the subject of any other 
adverse action by any Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion.
    (3) Only the following factors may be considered as mitigating and a 
basis for reducing the period of exclusion--
    (i) There were few violations and they occurred over a short period 
of time; or
    (ii) Alternative sources of the type of health care items or 
services furnished by the entity are not available.
    (iii) The entity took corrective action upon learning of 
impermissible activities by an employee or contractor.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46688, Sept. 2, 1998]



Sec.  1001.901  False or improper claims.

    (a) Circumstance for exclusion. The OIG may exclude any individual 
or entity that it determines has committed an act described in section 
1128A of the Act. The imposition of a civil money penalty or assessment 
is not a prerequisite for an exclusion under this section.
    (b) Length of exclusion. In determining the length of an exclusion 
imposed in accordance with this section, the OIG will consider the 
following factors--
    (1) The nature and circumstances surrounding the actions that are 
the basis for liability, including the period of time over which the 
acts occurred, the number of acts, whether there is evidence of a 
pattern and the amount claimed;
    (2) The degree of culpability;
    (3) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing (The lack of any prior 
record is to be considered neutral);
    (4) The individual or entity has been the subject of any other 
adverse action by any Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion; or
    (5) Other matters as justice may require.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46689, Sept. 2, 1998]



Sec.  1001.951  Fraud and kickbacks and other prohibited activities.

    (a) Circumstance for exclusion. (1) Except as provided for in 
paragraph (a)(2)(ii) of this section, the OIG may

[[Page 680]]

exclude any individual or entity that it determines has committed an act 
described in section 1128B(b) of the Act.
    (2) With respect to acts described in section 1128B of the Act, the 
OIG--
    (i) May exclude any individual or entity that it determines has 
knowingly and willfully solicited, received, offered or paid any 
remuneration in the manner and for the purposes described therein, 
irrespective of whether the individual or entity may be able to prove 
that the remuneration was also intended for some other purpose; and
    (ii) Will not exclude any individual or entity if that individual or 
entity can prove that the remuneration that is the subject of the 
exclusion is exempted from serving as the basis for an exclusion.
    (b) Length of exclusion. (1) The following factors will be 
considered in determining the length of exclusion in accordance with 
this section--
    (i) The nature and circumstances of the acts and other similar acts;
    (ii) The nature and extent of any adverse physical, mental, 
financial or other impact the conduct had on program beneficiaries or 
other individuals or the Medicare, Medicaid and all other Federal health 
care programs;
    (iii) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing (The lack of any prior 
record is to be considered neutral);
    (iv) The individual or entity has been the subject of any other 
adverse action by any Federal, State or local government agency or 
board, if the adverse action is based on the same set of circumstances 
that serves as the basis for the imposition of the exclusion; or
    (v) Any other facts bearing on the nature and seriousness of the 
individual's or entity's misconduct.
    (2) It will be considered a mitigating factor if--
    (i) The individual had a documented mental, emotional, or physical 
condition before or during the commission of the prohibited act(s) that 
reduced the individual's culpability for the acts in question;
    (ii) The individual's or entity's cooperation with Federal or State 
officials resulted in the--
    (A) Sanctioning of other individuals or entities, or
    (B) Imposition of a civil money penalty against others; or
    (iii) Alternative sources of the type of health care items or 
services provided by the individual or entity are not available.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46689, Sept. 2, 1998; 67 
FR 11933, Mar. 18, 2002]



Sec.  1001.952  Exceptions.

    The following payment practices shall not be treated as a criminal 
offense under section 1128B of the Act and shall not serve as the basis 
for an exclusion:
    (a) Investment interests. As used in section 1128B of the Act, 
``remuneration'' does not include any payment that is a return on an 
investment interest, such as a dividend or interest income, made to an 
investor as long as all of the applicable standards are met within one 
of the following three categories of entities:
    (1) If, within the previous fiscal year or previous 12 month period, 
the entity possesses more than $50,000,000 in undepreciated net tangible 
assets (based on the net acquisition cost of purchasing such assets from 
an unrelated entity) related to the furnishing of health care items and 
services, all of the following five standards must be met--
    (i) With respect to an investment interest that is an equity 
security, the equity security must be registered with the Securities and 
Exchange Commission under 15 U.S.C. 781 (b) or (g).
    (ii) The investment interest of an investor in a position to make or 
influence referrals to, furnish items or services to, or otherwise 
generate business for the entity must be obtained on terms (including 
any direct or indirect transferability restrictions) and at a price 
equally available to the public when trading on a registered securities 
exchange, such as the New York Stock Exchange or the American Stock 
Exchange, or in accordance with the National Association of Securities 
Dealers Automated Quotation System.
    (iii) The entity or any investor must not market or furnish the 
entity's items or services (or those of another

[[Page 681]]

entity as part of a cross referral agreement) to passive investors 
differently than to non-investors.
    (iv) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor in the entity) must not 
loan funds to or guarantee a loan for an investor who is in a position 
to make or influence referrals to, furnish items or services to, or 
otherwise generate business for the entity if the investor uses any part 
of such loan to obtain the investment interest.
    (v) The amount of payment to an investor in return for the 
investment interest must be directly proportional to the amount of the 
capital investment of that investor.
    (2) If the entity possesses investment interests that are held by 
either active or passive investors, all of the following eight 
applicable standards must be met--
    (i) No more than 40 percent of the value of the investment interests 
of each class of investment interests may be held in the previous fiscal 
year or previous 12 month period by investors who are in a position to 
make or influence referrals to, furnish items or services to, or 
otherwise generate business for the entity. (For purposes of paragraph 
(a)(2)(i) of this section, equivalent classes of equity investments may 
be combined, and equivalent classes of debt instruments may be 
combined.)
    (ii) The terms on which an investment interest is offered to a 
passive investor, if any, who is in a position to make or influence 
referrals to, furnish items or services to, or otherwise generate 
business for the entity must be no different from the terms offered to 
other passive investors.
    (iii) The terms on which an investment interest is offered to an 
investor who is in a position to make or influence referrals to, furnish 
items or services to, or otherwise generate business for the entity must 
not be related to the previous or expected volume of referrals, items or 
services furnished, or the amount of business otherwise generated from 
that investor to the entity.
    (iv) There is no requirement that a passive investor, if any, make 
referrals to, be in a position to make or influence referrals to, 
furnish items or services to, or otherwise generate business for the 
entity as a condition for remaining as an investor.
    (v) The entity or any investor must not market or furnish the 
entity's items or services (or those of another entity as part of a 
cross referral agreement) to passive investors differently than to non-
investors.
    (vi) No more than 40 percent of the entity's gross revenue related 
to the furnishing of health care items and services in the previous 
fiscal year or previous 12-month period may come from referrals or 
business otherwise generated from investors.
    (vii) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor in the entity) must not 
loan funds to or guarantee a loan for an investor who is in a position 
to make or influence referrals to, furnish items or services to, or 
otherwise generate business for the entity if the investor uses any part 
of such loan to obtain the investment interest.
    (viii) The amount of payment to an investor in return for the 
investment interest must be directly proportional to the amount of the 
capital investment (including the fair market value of any pre-
operational services rendered) of that investor.
    (3)(i) If the entity possesses investment interests that are held by 
either active or passive investors and is located in an underserved 
area, all of the following eight standards must be met--
    (A) No more than 50 percent of the value of the investment interests 
of each class of investments may be held in the previous fiscal year or 
previous 12-month period by investors who are in a position to make or 
influence referrals to, furnish items or services to, or otherwise 
generate business for, the entity. (For purposes of paragraph 
(a)(3)(i)(A) of this section, equivalent classes of equity investments 
may be combined, and equivalent classes of debt instruments may be 
combined.)
    (B) The terms on which an investment interest is offered to a 
passive investor, if any, who is in a position to make or influence 
referrals to, furnish items or services to, or otherwise generate 
business for the entity must be no different from the terms offered to 
other passive investors.

[[Page 682]]

    (C) The terms on which an investment interest is offered to an 
investor who is in a position to make or influence referrals to, furnish 
items or services to, or otherwise generate business for the entity must 
not be related to the previous or expected volume of referrals, items or 
services furnished, or the amount of business otherwise generated from 
that investor to the entity.
    (D) There is no requirement that a passive investor, if any, make 
referrals to, be in a position to make or influence referrals to, 
furnish items or services to, or otherwise generate business for the 
entity as a condition for remaining as an investor.
    (E) The entity or any investor must not market or furnish the 
entity's items or services (or those of another entity as part of a 
cross-referral agreement) to passive investors differently than to non-
investors.
    (F) At least 75 percent of the dollar volume of the entity's 
business in the previous fiscal year or previous 12-month period must be 
derived from the service of persons who reside in an underserved area or 
are members of medically underserved populations.
    (G) The entity or any investor (or other individual or entity acting 
on behalf of the entity or any investor in the entity) must not loan 
funds to or guarantee a loan for an investor who is in a position to 
make or influence referrals to, furnish items or services to, or 
otherwise generate business for the entity if the investor uses any part 
of such loan to obtain the investment interest.
    (H) The amount of payment to an investor in return for the 
investment interest must be directly proportional to the amount of the 
capital investment (including the fair market value of any pre-
operational services rendered) of that investor.
    (ii) If an entity that otherwise meets all of the above standards is 
located in an area that was an underserved area at the time of the 
initial investment, but subsequently ceases to be an underserved area, 
the entity will be deemed to comply with paragraph (a)(3)(i) of this 
section for a period equal to the lesser of:
    (A) The current term of the investment remaining after the date upon 
which the area ceased to be an underserved area or
    (B) Three years from the date the area ceased to be an underserved 
area.
    (4) For purposes of paragraph (a) of this section, the following 
terms apply. Active investor means an investor either who is responsible 
for the day-to-day management of the entity and is a bona fide general 
partner in a partnership under the Uniform Partnership Act or who agrees 
in writing to undertake liability for the actions of the entity's agents 
acting within the scope of their agency. Investment interest means a 
security issued by an entity, and may include the following classes of 
investments: shares in a corporation, interests or units in a 
partnership or limited liability company, bonds, debentures, notes, or 
other debt instruments. Investor means an individual or entity either 
who directly holds an investment interest in an entity, or who holds 
such investment interest indirectly by, including but not limited to, 
such means as having a family member hold such investment interest or 
holding a legal or beneficial interest in another entity (such as a 
trust or holding company) that holds such investment interest. Passive 
investor means an investor who is not an active investor, such as a 
limited partner in a partnership under the Uniform Partnership Act, a 
shareholder in a corporation, or a holder of a debt security. 
Underserved area means any defined geographic area that is designated as 
a Medically Underserved Area (MUA) in accordance with regulations issued 
by the Department. Medically underserved population means a Medically 
Underserved Population (MUP) in accordance with regulations issued by 
the Department.
    (b) Space rental. As used in section 1128B of the Act, 
``remuneration'' does not include any payment made by a lessee to a 
lessor for the use of premises, as long as all of the following six 
standards are met--
    (1) The lease agreement is set out in writing and signed by the 
parties.
    (2) The lease covers all of the premises leased between the parties 
for the term of the lease and specifies the premises covered by the 
lease.
    (3) If the lease is intended to provide the lessee with access to 
the premises

[[Page 683]]

for periodic intervals of time, rather than on a full-time basis for the 
term of the lease, the lease specifies exactly the schedule of such 
intervals, their precise length, and the exact rent for such intervals.
    (4) The term of the lease is for not less than one year.
    (5) The aggregate rental charge is set in advance, is consistent 
with fair market value in arms-length transactions and is not determined 
in a manner that takes into account the volume or value of any referrals 
or business otherwise generated between the parties for which payment 
may be made in whole or in part under Medicare, Medicaid or other 
Federal health care programs.
    (6) The aggregate space rented does not exceed that which is 
reasonably necessary to accomplish the commercially reasonable business 
purpose of the rental. Note that for purposes of paragraph (b) of this 
section, the term fair market value means the value of the rental 
property for general commercial purposes, but shall not be adjusted to 
reflect the additional value that one party (either the prospective 
lessee or lessor) would attribute to the property as a result of its 
proximity or convenience to sources of referrals or business otherwise 
generated for which payment may be made in whole or in part under 
Medicare, Medicaid and all other Federal health care programs.
    (c) Equipment rental. As used in section 1128B of the Act, 
``remuneration'' does not include any payment made by a lessee of 
equipment to the lessor of the equipment for the use of the equipment, 
as long as all of the following six standards are met--
    (1) The lease agreement is set out in writing and signed by the 
parties.
    (2) The lease covers all of the equipment leased between the parties 
for the term of the lease and specifies the equipment covered by the 
lease.
    (3) If the lease is intended to provide the lessee with use of the 
equipment for periodic intervals of time, rather than on a full-time 
basis for the term of the lease, the lease specifies exactly the 
schedule of such intervals, their precise length, and the exact rent for 
such interval.
    (4) The term of the lease is for not less than one year.
    (5) The aggregate rental charge is set in advance, is consistent 
with fair market value in arms-length transactions and is not determined 
in a manner that takes into account the volume or value of any referrals 
or business otherwise generated between the parties for which payment 
may be made in whole or in part under Medicare, Medicaid or all other 
Federal health care programs.
    (6) The aggregate equipment rental does not exceed that which is 
reasonably necessary to accomplish the commercially reasonable business 
purpose of the rental. Note that for purposes of paragraph (c) of this 
section, the term fair market value means that the value of the 
equipment when obtained from a manufacturer or professional distributor, 
but shall not be adjusted to reflect the additional value one party 
(either the prospective lessee or lessor) would attribute to the 
equipment as a result of its proximity or convenience to sources of 
referrals or business otherwise generated for which payment may be made 
in whole or in part under Medicare, Medicaid or other Federal health 
care programs.
    (d) Personal services and management contracts. As used in section 
1128B of the Act, ``remuneration'' does not include any payment made by 
a principal to an agent as compensation for the services of the agent, 
as long as all of the following seven standards are met--
    (1) The agency agreement is set out in writing and signed by the 
parties.
    (2) The agency agreement covers all of the services the agent 
provides to the principal for the term of the agreement and specifies 
the services to be provided by the agent.
    (3) If the agency agreement is intended to provide for the services 
of the agent on a periodic, sporadic or part-time basis, rather than on 
a full-time basis for the term of the agreement, the agreement specifies 
exactly the schedule of such intervals, their precise length, and the 
exact charge for such intervals.
    (4) The term of the agreement is for not less than one year.
    (5) The aggregate compensation paid to the agent over the term of 
the agreement is set in advance, is consistent with fair market value in 
arms-

[[Page 684]]

length transactions and is not determined in a manner that takes into 
account the volume or value of any referrals or business otherwise 
generated between the parties for which payment may be made in whole or 
in part under Medicare, Medicaid or other Federal health care programs.
    (6) The services performed under the agreement do not involve the 
counselling or promotion of a business arrangement or other activity 
that violates any State or Federal law.
    (7) The aggregate services contracted for do not exceed those which 
are reasonably necessary to accomplish the commercially reasonable 
business purpose of the services.
    For purposes of paragraph (d) of this section, an agent of a 
principal is any person, other than a bona fide employee of the 
principal, who has an agreement to perform services for, or on behalf 
of, the principal.
    (e) Sale of practice. (1) As used in section 1128B of the Act, 
``remuneration'' does not include any payment made to a practitioner by 
another practitioner where the former practitioner is selling his or her 
practice to the latter practitioner, as long as both of the following 
two standards are met--
    (i) The period from the date of the first agreement pertaining to 
the sale to the completion of the sale is not more than one year.
    (ii) The practitioner who is selling his or her practice will not be 
in a professional position to make referrals to, or otherwise generate 
business for, the purchasing practitioner for which payment may be made 
in whole or in part under Medicare, Medicaid or other Federal health 
care programs after 1 year from the date of the first agreement 
pertaining to the sale.
    (2) As used in section 1128B of the Act, ``remuneration'' does not 
include any payment made to a practitioner by a hospital or other entity 
where the practitioner is selling his or her practice to the hospital or 
other entity, so long as the following four standards are met:
    (i) The period from the date of the first agreement pertaining to 
the sale to the completion date of the sale is not more than three 
years.
    (ii) The practitioner who is selling his or her practice will not be 
in a professional position after completion of the sale to make or 
influence referrals to, or otherwise generate business for, the 
purchasing hospital or entity for which payment may be made under 
Medicare, Medicaid or other Federal health care programs.
    (iii) The practice being acquired must be located in a Health 
Professional Shortage Area (HPSA), as defined in Departmental 
regulations, for the practitioner's specialty area.
    (iv) Commencing at the time of the first agreement pertaining to the 
sale, the purchasing hospital or entity must diligently and in good 
faith engage in commercially reasonable recruitment activities that:
    (A) May reasonably be expected to result in the recruitment of a new 
practitioner to take over the acquired practice within a one year period 
and
    (B) Will satisfy the conditions of the practitioner recruitment safe 
harbor in accordance with paragraph (n) of this section.
    (f) Referral services. As used in section 1128B of the Act, 
``remuneration'' does not include any payment or exchange of anything of 
value between an individual or entity (``participant'') and another 
entity serving as a referral service (``referral service''), as long as 
all of the following four standards are met--
    (1) The referral service does not exclude as a participant in the 
referral service any individual or entity who meets the qualifications 
for participation.
    (2) Any payment the participant makes to the referral service is 
assessed equally against and collected equally from all participants, 
and is only based on the cost of operating the referral service, and not 
on the volume or value of any referrals to or business otherwise 
generated by either party for the referral service for which payment may 
be made in whole or in part under Medicare, Medicaid or other Federal 
health care programs.
    (3) The referral service imposes no requirements on the manner in 
which the participant provides services to a referred person, except 
that the referral

[[Page 685]]

service may require that the participant charge the person referred at 
the same rate as it charges other persons not referred by the referral 
service, or that these services be furnished free of charge or at 
reduced charge.
    (4) The referral service makes the following five disclosures to 
each person seeking a referral, with each such disclosure maintained by 
the referral service in a written record certifying such disclosure and 
signed by either such person seeking a referral or by the individual 
making the disclosure on behalf of the referral service--
    (i) The manner in which it selects the group of participants in the 
referral service to which it could make a referral;
    (ii) Whether the participant has paid a fee to the referral service;
    (iii) The manner in which it selects a particular participant from 
this group for that person;
    (iv) The nature of the relationship between the referral service and 
the group of participants to whom it could make the referral; and
    (v) The nature of any restrictions that would exclude such an 
individual or entity from continuing as a participant.
    (g) Warranties. As used in section 1128B of the Act, 
``remuneration'' does not include any payment or exchange of anything of 
value under a warranty provided by a manufacturer or supplier of an item 
to the buyer (such as a health care provider or beneficiary) of the 
item, as long as the buyer complies with all of the following standards 
in paragraphs (g)(1) and (g)(2) of this section and the manufacturer or 
supplier complies with all of the following standards in paragraphs 
(g)(3) and (g)(4) of this section--
    (1) The buyer must fully and accurately report any price reduction 
of the item (including a free item), which was obtained as part of the 
warranty, in the applicable cost reporting mechanism or claim for 
payment filed with the Department or a State agency.
    (2) The buyer must provide, upon request by the Secretary or a State 
agency, information provided by the manufacturer or supplier as 
specified in paragraph (g)(3) of this section.
    (3) The manufacturer or supplier must comply with either of the 
following two standards--
    (i) The manufacturer or supplier must fully and accurately report 
the price reduction of the item (including a free item), which was 
obtained as part of the warranty, on the invoice or statement submitted 
to the buyer, and inform the buyer of its obligations under paragraphs 
(a)(1) and (a)(2) of this section.
    (ii) Where the amount of the price reduction is not known at the 
time of sale, the manufacturer or supplier must fully and accurately 
report the existence of a warranty on the invoice or statement, inform 
the buyer of its obligations under paragraphs (g)(1) and (g)(2) of this 
section, and, when the price reduction becomes known, provide the buyer 
with documentation of the calculation of the price reduction resulting 
from the warranty.
    (4) The manufacturer or supplier must not pay any remuneration to 
any individual (other than a beneficiary) or entity for any medical, 
surgical, or hospital expense incurred by a beneficiary other than for 
the cost of the item itself.
    For purposes of paragraph (g) of this section, the term warranty 
means either an agreement made in accordance with the provisions of 15 
U.S.C. 2301(6), or a manufacturer's or supplier's agreement to replace 
another manufacturer's or supplier's defective item (which is covered by 
an agreement made in accordance with this statutory provision), on terms 
equal to the agreement that it replaces.
    (h) Discounts. As used in section 1128B of the Act, ``remuneration'' 
does not include a discount, as defined in paragraph (h)(5) of this 
section, on an item or service for which payment may be made in whole or 
in part under Medicare, Medicaid or other Federal health care programs 
for a buyer as long as the buyer complies with the applicable standards 
of paragraph (h)(1) of this section; a seller as long as the seller 
complies with the applicable standards of paragraph (h)(2) of this 
section; and an offeror of a discount who is not a seller under 
paragraph (h)(2) of this section so long as such offeror complies

[[Page 686]]

with the applicable standards of paragraph (h)(3) of this section.
    (1) With respect to the following three categories of buyers, the 
buyer must comply with all of the applicable standards within one of the 
three following categories--
    (i) If the buyer is an entity which is a health maintenance 
organization (HMO) or a competitive medical plan (CMP) acting in 
accordance with a risk contract under section 1876(g) or 1903(m) of the 
Act, or under another State health care program, it need not report the 
discount except as otherwise may be required under the risk contract.
    (ii) If the buyer is an entity which reports its costs on a cost 
report required by the Department or a State health care program, it 
must comply with all of the following four standards--
    (A) The discount must be earned based on purchases of that same good 
or service bought within a single fiscal year of the buyer;
    (B) The buyer must claim the benefit of the discount in the fiscal 
year in which the discount is earned or the following year;
    (C) The buyer must fully and accurately report the discount in the 
applicable cost report; and
    (D) the buyer must provide, upon request by the Secretary or a State 
agency, information provided by the seller as specified in paragraph 
(h)(2)(ii) of this section, or information provided by the offeror as 
specified in paragraph (h)(3)(ii) of this section.
    (iii) If the buyer is an individual or entity in whose name a claim 
or request for payment is submitted for the discounted item or service 
and payment may be made, in whole or in part, under Medicare, Medicaid 
or other Federal health care programs (not including individuals or 
entities defined as buyers in paragraph (h)(1)(i) or (h)(1)(ii) of this 
section), the buyer must comply with both of the following standards--
    (A) The discount must be made at the time of the sale of the good or 
service or the terms of the rebate must be fixed and disclosed in 
writing to the buyer at the time of the initial sale of the good or 
service; and
    (B) the buyer (if submitting the claim) must provide, upon request 
by the Secretary or a State agency, information provided by the seller 
as specified in paragraph (h)(2)(iii)(B) of this section, or information 
provided by the offeror as specified in paragraph (h)(3)(iii)(A) of this 
section.
    (2) The seller is an individual or entity that supplies an item or 
service for which payment may be made, in whole or in part, under 
Medicare, Medicaid or other Federal health care programs to the buyer 
and who permits a discount to be taken off the buyer's purchase price. 
The seller must comply with all of the applicable standards within one 
of the following three categories--
    (i) If the buyer is an entity which is an HMO a CMP acting in 
accordance with a risk contract under section 1876(g) or 1903(m) of the 
Act, or under another State health care program, the seller need not 
report the discount to the buyer for purposes of this provision.
    (ii) If the buyer is an entity that reports its costs on a cost 
report required by the Department or a State agency, the seller must 
comply with either of the following two standards--
    (A) Where a discount is required to be reported to Medicare or a 
State health care program under paragraph (h)(1) of this section, the 
seller must fully and accurately report such discount on the invoice, 
coupon or statement submitted to the buyer; inform the buyer in a manner 
that is reasonably calculated to give notice to the buyer of its 
obligations to report such discount and to provide information upon 
request under paragraph (h)(1) of this section; and refrain from doing 
anything that would impede the buyer from meeting its obligations under 
this paragraph; or
    (B) Where the value of the discount is not known at the time of 
sale, the seller must fully and accurately report the existence of a 
discount program on the invoice, coupon or statement submitted to the 
buyer; inform the buyer in a manner reasonably calculated to give notice 
to the buyer of its obligations to report such discount and to provide 
information upon request under paragraph (h)(1) of this section; when 
the value of the discount becomes

[[Page 687]]

known, provide the buyer with documentation of the calculation of the 
discount identifying the specific goods or services purchased to which 
the discount will be applied; and refrain from doing anything which 
would impede the buyer from meeting its obligations under this 
paragraph.
    (iii) If the buyer is an individual or entity not included in 
paragraph (h)(2)(i) or (h)(2)(ii) of this section, the seller must 
comply with either of the following two standards--
    (A) Where the seller submits a claim or request for payment on 
behalf of the buyer and the item or service is separately claimed, the 
seller must provide, upon request by the Secretary or a State agency, 
information provided by the offeror as specified in paragraph 
(h)(3)(iii)(A) of this section; or
    (B) Where the buyer submits a claim, the seller must fully and 
accurately report such discount on the invoice, coupon or statement 
submitted to the buyer; inform the buyer in a manner reasonably 
calculated to give notice to the buyer of its obligations to report such 
discount and to provide information upon request under paragraph (h)(1) 
of this section; and refrain from doing anything that would impede the 
buyer from meeting its obligations under this paragraph.
    (3) The offeror of a discount is an individual or entity who is not 
a seller under paragraph (h)(2) of this section, but promotes the 
purchase of an item or service by a buyer under paragraph (h)(1) of this 
section at a reduced price for which payment may be made, in whole or in 
part, under Medicare, Medicaid or other Federal health care programs. 
The offeror must comply with all of the applicable standards within the 
following three categories--
    (i) If the buyer is an entity which is an HMO or a CMP acting in 
accordance with a risk contract under section 1876(g) or 1903(m) of the 
Act, or under another State health care program, the offeror need not 
report the discount to the buyer for purposes of this provision.
    (ii) If the buyer is an entity that reports its costs on a cost 
report required by the Department or a State agency, the offeror must 
comply with the following two standards--
    (A) The offeror must inform the buyer in a manner reasonably 
calculated to give notice to the buyer of its obligations to report such 
a discount and to provide information upon request under paragraph 
(h)(1) of this section; and
    (B) The offeror of the discount must refrain from doing anything 
that would impede the buyer's ability to meet its obligations under this 
paragraph.
    (iii) If the buyer is an individual or entity in whose name a 
request for payment is submitted for the discounted item or service and 
payment may be made, in whole or in part, under Medicare, Medicaid or 
other Federal health care programs (not including individuals or 
entities defined as buyers in paragraph (h)(1)(i) or (h)(1)(ii) of this 
section), the offeror must comply with the following two standards--
    (A) The offeror must inform the individual or entity submitting the 
claim or request for payment in a manner reasonably calculated to give 
notice to the individual or entity of its obligations to report such a 
discount and to provide information upon request under paragraphs (h)(1) 
and (h)(2) of this section; and
    (B) The offeror of the discount must refrain from doing anything 
that would impede the buyer's or seller's ability to meet its 
obligations under this paragraph.
    (4) For purposes of this paragraph, a rebate is any discount the 
terms of which are fixed and disclosed in writing to the buyer at the 
time of the initial purchase to which the discount applies, but which is 
not given at the time of sale.
    (5) For purposes of this paragraph, the term discount means a 
reduction in the amount a buyer (who buys either directly or through a 
wholesaler or a group purchasing organization) is charged for an item or 
service based on an arms-length transaction. The term discount does not 
include--
    (i) Cash payment or cash equivalents (except that rebates as defined 
in paragraph (h)(4) of this section may be in the form of a check);
    (ii) Supplying one good or service without charge or at a reduced 
charge to induce the purchase of a different good or service, unless the 
goods and

[[Page 688]]

services are reimbursed by the same Federal health care program using 
the same methodology and the reduced charge is fully disclosed to the 
Federal health care program and accurately reflected where appropriate, 
and as appropriate, to the reimbursement methodology;
    (iii) A reduction in price applicable to one payer but not to 
Medicare, Medicaid or other Federal health care programs;
    (iv) A routine reduction or waiver of any coinsurance or deductible 
amount owed by a program beneficiary;
    (v) Warranties;
    (vi) Services provided in accordance with a personal or management 
services contract; or
    (vii) Other remuneration, in cash or in kind, not explicitly 
described in paragraph (h)(5) of this section.
    (i) Employees. As used in section 1128B of the Act, ``remuneration'' 
does not include any amount paid by an employer to an employee, who has 
a bona fide employment relationship with the employer, for employment in 
the furnishing of any item or service for which payment may be made in 
whole or in part under Medicare, Medicaid or other Federal health care 
programs. For purposes of paragraph (i) of this section, the term 
employee has the same meaning as it does for purposes of 26 U.S.C. 
3121(d)(2).
    (j) Group purchasing organizations. As used in section 1128B of the 
Act, ``remuneration'' does not include any payment by a vendor of goods 
or services to a group purchasing organization (GPO), as part of an 
agreement to furnish such goods or services to an individual or entity 
as long as both of the following two standards are met--
    (1) The GPO must have a written agreement with each individual or 
entity, for which items or services are furnished, that provides for 
either of the following--
    (i) The agreement states that participating vendors from which the 
individual or entity will purchase goods or services will pay a fee to 
the GPO of 3 percent or less of the purchase price of the goods or 
services provided by that vendor.
    (ii) In the event the fee paid to the GPO is not fixed at 3 percent 
or less of the purchase price of the goods or services, the agreement 
specifies the amount (or if not known, the maximum amount) the GPO will 
be paid by each vendor (where such amount may be a fixed sum or a fixed 
percentage of the value of purchases made from the vendor by the members 
of the group under the contract between the vendor and the GPO).
    (2) Where the entity which receives the goods or service from the 
vendor is a health care provider of services, the GPO must disclose in 
writing to the entity at least annually, and to the Secretary upon 
request, the amount received from each vendor with respect to purchases 
made by or on behalf of the entity. Note that for purposes of paragraph 
(j) of this section, the term group purchasing organization (GPO) means 
an entity authorized to act as a purchasing agent for a group of 
individuals or entities who are furnishing services for which payment 
may be made in whole or in part under Medicare, Medicaid or other 
Federal health care programs, and who are neither wholly-owned by the 
GPO nor subsidiaries of a parent corporation that wholly owns the GPO 
(either directly or through another wholly-owned entity).
    (k) Waiver of beneficiary coinsurance and deductible amounts. As 
used in section 1128B of the Act, ``remuneration'' does not include any 
reduction or waiver of a Medicare or a State health care program 
beneficiary's obligation to pay coinsurance or deductible amounts as 
long as all of the standards are met within either of the following two 
categories of health care providers:
    (1) If the coinsurance or deductible amounts are owed to a hospital 
for inpatient hospital services for which Medicare pays under the 
prospective payment system, the hospital must comply with all of the 
following three standards--
    (i) The hospital must not later claim the amount reduced or waived 
as a bad debt for payment purposes under Medicare or otherwise shift the 
burden of the reduction or waiver onto Medicare, a State health care 
program, other payers, or individuals.
    (ii) The hospital must offer to reduce or waive the coinsurance or 
deductible

[[Page 689]]

amounts without regard to the reason for admission, the length of stay 
of the beneficiary, or the diagnostic related group for which the claim 
for Medicare reimbursement is filed.
    (iii) The hospital's offer to reduce or waive the coinsurance or 
deductible amounts must not be made as part of a price reduction 
agreement between a hospital and a third-party payer (including a health 
plan as defined in paragraph (l)(2) of this section), unless the 
agreement is part of a contract for the furnishing of items or services 
to a beneficiary of a Medicare supplemental policy issued under the 
terms of section 1882(t)(1) of the Act.
    (2) If the coinsurance or deductible amounts are owed by an 
individual who qualifies for subsidized services under a provision of 
the Public Health Services Act or under titles V or XIX of the Act to a 
federally qualified health care center or other health care facility 
under any Public Health Services Act grant program or under title V of 
the Act, the health care center or facility may reduce or waive the 
coinsurance or deductible amounts for items or services for which 
payment may be made in whole or in part under part B of Medicare or a 
State health care program.
    (l) Increased coverage, reduced cost-sharing amounts, or reduced 
premium amounts offered by health plans. (1) As used in section 1128B of 
the Act, ``remuneration'' does not include the additional coverage of 
any item or service offered by a health plan to an enrollee or the 
reduction of some or all of the enrollee's obligation to pay the health 
plan or a contract health care provider for cost-sharing amounts (such 
as coinsurance, deductible, or copayment amounts) or for premium amounts 
attributable to items or services covered by the health plan, the 
Medicare program, or a State health care program, as long as the health 
plan complies with all of the standards within one of the following two 
categories of health plans:
    (i) If the health plan is a risk-based health maintenance 
organization, competitive medical plan, prepaid health plan, or other 
health plan under contract with CMS or a State health care program and 
operating in accordance with section 1876(g) or 1903(m) of the Act, 
under a Federal statutory demonstration authority, or under other 
Federal statutory or regulatory authority, it must offer the same 
increased coverage or reduced cost-sharing or premium amounts to all 
Medicare or State health care program enrollees covered by the contract 
unless otherwise approved by CMS or by a State health care program.
    (ii) If the health plan is a health maintenance organization, 
competitive medical plan, health care prepayment plan, prepaid health 
plan or other health plan that has executed a contract or agreement with 
CMS or with a State health care program to receive payment for enrollees 
on a reasonable cost or similar basis, it must comply with both of the 
following two standards--
    (A) The health plan must offer the same increased coverage or 
reduced cost-sharing or premium amounts to all Medicare or State health 
care program enrollees covered by the contract or agreement unless 
otherwise approved by CMS or by a State health care program; and
    (B) The health plan must not claim the costs of the increased 
coverage or the reduced cost-sharing or premium amounts as a bad debt 
for payment purposes under Medicare or a State health care program or 
otherwise shift the burden of the increased coverage or reduced cost-
sharing or premium amounts to the extent that increased payments are 
claimed from Medicare or a State health care program.
    (2) For purposes of paragraph (l) of this section, the terms--
    Contract health care provider means an individual or entity under 
contract with a health plan to furnish items or services to enrollees 
who are covered by the health plan, Medicare, or a State health care 
program.
    Enrollee means an individual who has entered into a contractual 
relationship with a health plan (or on whose behalf an employer, or 
other private or governmental entity has entered into such a 
relationship) under which the individual is entitled to receive 
specified health care items and services, or insurance coverage for such 
items and services, in return for payment of a premium or a fee.

[[Page 690]]

    Health plan means an entity that furnishes or arranges under 
agreement with contract health care providers for the furnishing of 
items or services to enrollees, or furnishes insurance coverage for the 
provision of such items and services, in exchange for a premium or a 
fee, where such entity:
    (i) Operates in accordance with a contract, agreement or statutory 
demonstration authority approved by CMS or a State health care program;
    (ii) Charges a premium and its premium structure is regulated under 
a State insurance statute or a State enabling statute governing health 
maintenance organizations or preferred provider organizations;
    (iii) Is an employer, if the enrollees of the plan are current or 
retired employees, or is a union welfare fund, if the enrollees of the 
plan are union members; or
    (iv) Is licensed in the State, is under contract with an employer, 
union welfare fund, or a company furnishing health insurance coverage as 
described in conditions (ii) and (iii) of this definition, and is paid a 
fee for the administration of the plan which reflects the fair market 
value of those services.
    (m) Price reductions offered to health plans. (1) As used in section 
1128B of the Act, ``remuneration'' does not include a reduction in price 
a contract health care provider offers to a health plan in accordance 
with the terms of a written agreement between the contract health care 
provider and the health plan for the sole purpose of furnishing to 
enrollees items or services that are covered by the health plan, 
Medicare, or a State health care program, as long as both the health 
plan and contract health care provider comply with all of the applicable 
standards within one of the following four categories of health plans:
    (i) If the health plan is a risk-based health maintenance 
organization, competitive medical plan, or prepaid health plan under 
contract with CMS or a State agency and operating in accordance with 
section 1876(g) or 1903(m) of the Act, under a Federal statutory 
demonstration authority, or under other Federal statutory or regulatory 
authority, the contract health care provider must not claim payment in 
any form from the Department or the State agency for items or services 
furnished in accordance with the agreement except as approved by CMS or 
the State health care program, or otherwise shift the burden of such an 
agreement to the extent that increased payments are claimed from 
Medicare or a State health care program.
    (ii) If the health plan is a health maintenance organization, 
competitive medical plan, health care prepayment plan, prepaid health 
plan, or other health plan that has executed a contract or agreement 
with CMS or a State health care program to receive payment for enrollees 
on a reasonable cost or similar basis, the health plan and contract 
health care provider must comply with all of the following four 
standards--
    (A) The term of the agreement between the health plan and the 
contract health care provider must be for not less than one year;
    (B) The agreement between the health plan and the contract health 
care provider must specify in advance the covered items and services to 
be furnished to enrollees, and the methodology for computing the payment 
to the contract health care provider;
    (C) The health plan must fully and accurately report, on the 
applicable cost report or other claim form filed with the Department or 
the State health care program, the amount it has paid the contract 
health care provider under the agreement for the covered items and 
services furnished to enrollees; and
    (D) The contract health care provider must not claim payment in any 
form from the Department or the State health care program for items or 
services furnished in accordance with the agreement except as approved 
by CMS or the State health care program, or otherwise shift the burden 
of such an agreement to the extent that increased payments are claimed 
from Medicare or a State health care program.
    (iii) If the health plan is not described in paragraphs (m)(1)(i) or 
(m)(1)(ii) of this section and the contract health care provider is not 
paid on an at-risk, capitated basis, both the health plan and contract 
health care

[[Page 691]]

provider must comply with all of the following six standards--
    (A) The term of the agreement between the health plan and the 
contract health care provider must be for not less than one year;
    (B) The agreement between the health plan and the contract health 
care provider must specify in advance the covered items and services to 
be furnished to enrollees, which party is to file claims or requests for 
payment with Medicare or the State health care program for such items 
and services, and the schedule of fees the contract health care provider 
will charge for furnishing such items and services to enrollees;
    (C) The fee schedule contained in the agreement between the health 
plan and the contract health care provider must remain in effect 
throughout the term of the agreement, unless a fee increase results 
directly from a payment update authorized by Medicare or the State 
health care program;
    (D) The party submitting claims or requests for payment from 
Medicare or the State health care program for items and services 
furnished in accordance with the agreement must not claim or request 
payment for amounts in excess of the fee schedule;
    (E) The contract health care provider and the health plan must fully 
and accurately report on any cost report filed with Medicare or a State 
health care program the fee schedule amounts charged in accordance with 
the agreement and, upon request, will report to the Medicare or a State 
health care program the terms of the agreement and the amounts paid in 
accordance with the agreement; and
    (F) The party to the agreement, which does not have the 
responsibility under the agreement for filing claims or requests for 
payment, must not claim or request payment in any form from the 
Department or the State health care program for items or services 
furnished in accordance with the agreement, or otherwise shift the 
burden of such an agreement to the extent that increased payments are 
claimed from Medicare or a State health care program.
    (iv) If the health plan is not described in paragraphs (m)(1)(i) or 
(m)(1)(ii) of this section, and the contract health care provider is 
paid on an at-risk, capitated basis, both the health plan and contract 
health care provider must comply with all of the following five 
standards--
    (A) The term of the agreement between the health plan and the 
contract health provider must be for not less than one year;
    (B) The agreement between the health plan and the contract health 
provider must specify in advance the covered items and services to be 
furnished to enrollees and the total amount per enrollee (which may be 
expressed in a per month or other time period basis) the contract health 
care provider will be paid by the health plan for furnishing such items 
and services to enrollees and must set forth any copayments, if any, to 
be paid by enrollees to the contract health care provider for covered 
services;
    (C) The payment amount contained in the agreement between the health 
care plan and the contract health care provider must remain in effect 
throughout the term of the agreement;
    (D) The contract health care provider and the health plan must fully 
and accurately report to the Medicare and State health care program upon 
request, the terms of the agreement and the amounts paid in accordance 
with the agreement; and
    (E) The contract health care provider must not claim or request 
payment in any form from the Department, a State health care program or 
an enrollee (other than copayment amounts described in paragraph 
(m)(2)(iv)(B) of this section) and the health plan must not pay the 
contract care provider in excess of the amounts described in paragraph 
(m)(2)(iv)(B) of this section for items and services covered by the 
agreement.
    (2) For purposes of this paragraph, the terms contract health care 
provider, enrollee, and health plan have the same meaning as in 
paragraph (l)(2) of this section.
    (n) Practitioner recruitment. As used in section 1128B of the Act, 
``remuneration'' does not include any payment or exchange of anything of 
value by an entity in order to induce a practitioner who has been 
practicing within his or

[[Page 692]]

her current specialty for less than one year to locate, or to induce any 
other practitioner to relocate, his or her primary place of practice 
into a HPSA for his or her specialty area, as defined in Departmental 
regulations, that is served by the entity, as long as all of the 
following nine standards are met--
    (1) The arrangement is set forth in a written agreement signed by 
the parties that specifies the benefits provided by the entity, the 
terms under which the benefits are to be provided, and the obligations 
of each party.
    (2) If a practitioner is leaving an established practice, at least 
75 percent of the revenues of the new practice must be generated from 
new patients not previously seen by the practitioner at his or her 
former practice.
    (3) The benefits are provided by the entity for a period not in 
excess of 3 years, and the terms of the agreement are not renegotiated 
during this 3-year period in any substantial aspect; provided, however, 
that if the HPSA to which the practitioner was recruited ceases to be a 
HPSA during the term of the written agreement, the payments made under 
the written agreement will continue to satisfy this paragraph for the 
duration of the written agreement (not to exceed 3 years).
    (4) There is no requirement that the practitioner make referrals to, 
be in a position to make or influence referrals to, or otherwise 
generate business for the entity as a condition for receiving the 
benefits; provided, however, that for purposes of this paragraph, the 
entity may require as a condition for receiving benefits that the 
practitioner maintain staff privileges at the entity.
    (5) The practitioner is not restricted from establishing staff 
privileges at, referring any service to, or otherwise generating any 
business for any other entity of his or her choosing.
    (6) The amount or value of the benefits provided by the entity may 
not vary (or be adjusted or renegotiated) in any manner based on the 
volume or value of any expected referrals to or business otherwise 
generated for the entity by the practitioner for which payment may be 
made in whole or in part under Medicare, Medicaid or any other Federal 
health care programs.
    (7) The practitioner agrees to treat patients receiving medical 
benefits or assistance under any Federal health care program in a 
nondiscriminatory manner.
    (8) At least 75 percent of the revenues of the new practice must be 
generated from patients residing in a HPSA or a Medically Underserved 
Area (MUA) or who are part of a Medically Underserved Population (MUP), 
all as defined in paragraph (a) of this section.
    (9) The payment or exchange of anything of value may not directly or 
indirectly benefit any person (other than the practitioner being 
recruited) or entity in a position to make or influence referrals to the 
entity providing the recruitment payments or benefits of items or 
services payable by a Federal health care program.
    (o) Obstetrical malpractice insurance subsidies. As used in section 
1128B of the Act, ``remuneration'' does not include any payment made by 
a hospital or other entity to another entity that is providing 
malpractice insurance (including a self-funded entity), where such 
payment is used to pay for some or all of the costs of malpractice 
insurance premiums for a practitioner (including a certified nurse-
midwife as defined in section 1861(gg) of the Act) who engages in 
obstetrical practice as a routine part of his or her medical practice in 
a primary care HPSA, as long as all of the following seven standards are 
met--
    (1) The payment is made in accordance with a written agreement 
between the entity paying the premiums and the practitioner, which sets 
out the payments to be made by the entity, and the terms under which the 
payments are to be provided.
    (2)(i) The practitioner must certify that for the initial coverage 
period (not to exceed one year) the practitioner has a reasonable basis 
for believing that at least 75 percent of the practitioner's obstetrical 
patients treated under the coverage of the malpractice insurance will 
either--
    (A) Reside in a HPSA or MUA, as defined in paragraph (a) of this 
section; or
    (B) Be part of a MUP, as defined in paragraph (a) of this section.

[[Page 693]]

    (ii) Thereafter, for each additional coverage period (not to exceed 
one year), at least 75 percent of the practitioner's obstetrical 
patients treated under the prior coverage period (not to exceed one 
year) must have--
    (A) Resided in a HPSA or MUA, as defined in paragraph (a) of this 
section; or
    (B) Been part of a MUP, as defined in paragraph (a) of this section.
    (3) There is no requirement that the practitioner make referrals to, 
or otherwise generate business for, the entity as a condition for 
receiving the benefits.
    (4) The practitioner is not restricted from establishing staff 
privileges at, referring any service to, or otherwise generating any 
business for any other entity of his or her choosing.
    (5) The amount of payment may not vary based on the volume or value 
of any previous or expected referrals to or business otherwise generated 
for the entity by the practitioner for which payment may be made in 
whole or in part under Medicare, Medicaid or any other Federal health 
care programs.
    (6) The practitioner must treat obstetrical patients who receive 
medical benefits or assistance under any Federal health care program in 
a nondiscriminatory manner.
    (7) The insurance is a bona fide malpractice insurance policy or 
program, and the premium, if any, is calculated based on a bona fide 
assessment of the liability risk covered under the insurance. For 
purposes of paragraph (o) of this section, costs of malpractice 
insurance premiums means:
    (i) For practitioners who engage in obstetrical practice full-time, 
any costs attributable to malpractice insurance; or
    (ii) For practitioners who engage in obstetrical practice on a part-
time or sporadic basis, the costs:
    (A) Attributable exclusively to the obstetrical portion of the 
practitioner's malpractice insurance and
    (B) Related exclusively to obstetrical services provided in a 
primary care HPSA.
    (p) Investments in group practices. As used in section 1128B of the 
Act, ``remuneration'' does not include any payment that is a return on 
an investment interest, such as a dividend or interest income, made to a 
solo or group practitioner investing in his or her own practice or group 
practice if the following four standards are met--
    (1) The equity interests in the practice or group must be held by 
licensed health care professionals who practice in the practice or 
group.
    (2) The equity interests must be in the practice or group itself, 
and not some subdivision of the practice or group.
    (3) In the case of group practices, the practice must:
    (i) Meet the definition of ``group practice'' in section 1877(h)(4) 
of the Social Security Act and implementing regulations; and
    (ii) Be a unified business with centralized decision-making, pooling 
of expenses and revenues, and a compensation/profit distribution system 
that is not based on satellite offices operating substantially as if 
they were separate enterprises or profit centers.
    (4) Revenues from ancillary services, if any, must be derived from 
``in-office ancillary services'' that meet the definition of such term 
in section 1877(b)(2) of the Act and implementing regulations.
    (q) Cooperative hospital service organizations. As used in section 
1128B of the Act, ``remuneration'' does not include any payment made 
between a cooperative hospital service organization (CHSO) and its 
patron-hospital, both of which are described in section 501(e) of the 
Internal Revenue Code of 1986 and are tax-exempt under section 501(c)(3) 
of the Internal Revenue Code, where the CHSO is wholly owned by two or 
more patron-hospitals, as long as the following standards are met--
    (1) If the patron-hospital makes a payment to the CHSO, the payment 
must be for the purpose of paying for the bona fide operating expenses 
of the CHSO, or
    (2) If the CHSO makes a payment to the patron-hospital, the payment 
must be for the purpose of paying a distribution of net earnings 
required to be made under section 501(e)(2) of the Internal Revenue Code 
of 1986.

[[Page 694]]

    (r) Ambulatory surgical centers. As used in section 1128B of the 
Act, ``remuneration'' does not include any payment that is a return on 
an investment interest, such as a dividend or interest income, made to 
an investor, as long as the investment entity is a certified ambulatory 
surgical center (ASC) under part 416 of this title, whose operating and 
recovery room space is dedicated exclusively to the ASC, patients 
referred to the investment entity by an investor are fully informed of 
the investor's investment interest, and all of the applicable standards 
are met within one of the following four categories--
    (1) Surgeon-owned ASCs--If all of the investors are general surgeons 
or surgeons engaged in the same surgical specialty, who are in a 
position to refer patients directly to the entity and perform surgery on 
such referred patients; surgical group practices (as defined in this 
paragraph) composed exclusively of such surgeons; or investors who are 
not employed by the entity or by any investor, are not in a position to 
provide items or services to the entity or any of its investors, and are 
not in a position to make or influence referrals directly or indirectly 
to the entity or any of its investors, all of the following six 
standards must be met--
    (i) The terms on which an investment interest is offered to an 
investor must not be related to the previous or expected volume of 
referrals, services furnished, or the amount of business otherwise 
generated from that investor to the entity.
    (ii) At least one-third of each surgeon investor's medical practice 
income from all sources for the previous fiscal year or previous 12-
month period must be derived from the surgeon's performance of 
procedures (as defined in this paragraph).
    (iii) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor) must not loan funds to 
or guarantee a loan for an investor if the investor uses any part of 
such loan to obtain the investment interest.
    (iv) The amount of payment to an investor in return for the 
investment must be directly proportional to the amount of the capital 
investment (including the fair market value of any pre-operational 
services rendered) of that investor.
    (v) All ancillary services for Federal health care program 
beneficiaries performed at the entity must be directly and integrally 
related to primary procedures performed at the entity, and none may be 
separately billed to Medicare or other Federal health care programs.
    (vi) The entity and any surgeon investors must treat patients 
receiving medical benefits or assistance under any Federal health care 
program in a nondiscriminatory manner.
    (2) Single-Specialty ASCs--If all of the investors are physicians 
engaged in the same medical practice specialty who are in a position to 
refer patients directly to the entity and perform procedures on such 
referred patients; group practices (as defined in this paragraph) 
composed exclusively of such physicians; or investors who are not 
employed by the entity or by any investor, are not in a position to 
provide items or services to the entity or any of its investors, and are 
not in a position to make or influence referrals directly or indirectly 
to the entity or any of its investors, all of the following six 
standards must be met--
    (i) The terms on which an investment interest is offered to an 
investor must not be related to the previous or expected volume of 
referrals, services furnished, or the amount of business otherwise 
generated from that investor to the entity.
    (ii) At least one-third of each physician investor's medical 
practice income from all sources for the previous fiscal year or 
previous 12-month period must be derived from the surgeon's performance 
of procedures (as defined in this paragraph).
    (iii) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor) must not loan funds to 
or guarantee a loan for an investor if the investor uses any part of 
such loan to obtain the investment interest.
    (iv) The amount of payment to an investor in return for the 
investment must be directly proportional to the amount of the capital 
investment (including the fair market value of any

[[Page 695]]

pre-operational services rendered) of that investor.
    (v) All ancillary services for Federal health care program 
beneficiaries performed at the entity must be directly and integrally 
related to primary procedures performed at the entity, and none may be 
separately billed to Medicare or other Federal health care programs.
    (vi) The entity and any physician investors must treat patients 
receiving medical benefits or assistance under any Federal health care 
program in a nondiscriminatory manner.
    (3) Multi-Specialty ASCs--If all of the investors are physicians who 
are in a position to refer patients directly to the entity and perform 
procedures on such referred patients; group practices, as defined in 
this paragraph, composed exclusively of such physicians; or investors 
who are not employed by the entity or by any investor, are not in a 
position to provide items or services to the entity or any of its 
investors, and are not in a position to make or influence referrals 
directly or indirectly to the entity or any of its investors, all of the 
following seven standards must be met--
    (i) The terms on which an investment interest is offered to an 
investor must not be related to the previous or expected volume of 
referrals, services furnished, or the amount of business otherwise 
generated from that investor to the entity.
    (ii) At least one-third of each physician investor's medical 
practice income from all sources for the previous fiscal year or 
previous 12-month period must be derived from the physician's 
performance of procedures (as defined in this paragraph).
    (iii) At least one-third of the procedures (as defined in this 
paragraph) performed by each physician investor for the previous fiscal 
year or previous 12-month period must be performed at the investment 
entity.
    (iv) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor) must not loan funds to 
or guarantee a loan for an investor if the investor uses any part of 
such loan to obtain the investment interest.
    (v) The amount of payment to an investor in return for the 
investment must be directly proportional to the amount of the capital 
investment (including the fair market value of any pre-operational 
services rendered) of that investor.
    (vi) All ancillary services for Federal health care program 
beneficiaries performed at the entity must be directly and integrally 
related to primary procedures performed at the entity, and none may be 
separately billed to Medicare or other Federal health care programs.
    (vii) The entity and any physician investors must treat patients 
receiving medical benefits or assistance under any Federal health care 
program in a nondiscriminatory manner.
    (4) Hospital/Physician ASCs--If at least one investor is a hospital, 
and all of the remaining investors are physicians who meet the 
requirements of paragraphs (r)(1), (r)(2) or (r)(3) of this section; 
group practices (as defined in this paragraph) composed of such 
physicians; surgical group practices (as defined in this paragraph); or 
investors who are not employed by the entity or by any investor, are not 
in a position to provide items or services to the entity or any of its 
investors, and are not in a position to refer patients directly or 
indirectly to the entity or any of its investors, all of the following 
eight standards must be met--
    (i) The terms on which an investment interest is offered to an 
investor must not be related to the previous or expected volume of 
referrals, services furnished, or the amount of business otherwise 
generated from that investor to the entity.
    (ii) The entity or any investor (or other individual or entity 
acting on behalf of the entity or any investor) must not loan funds to 
or guarantee a loan for an investor if the investor uses any part of 
such loan to obtain the investment interest.
    (iii) The amount of payment to an investor in return for the 
investment must be directly proportional to the amount of the capital 
investment (including the fair market value of any pre-operational 
services rendered) of that investor.

[[Page 696]]

    (iv) The entity and any hospital or physician investor must treat 
patients receiving medical benefits or assistance under any Federal 
health care program in a nondiscriminatory manner.
    (v) The entity may not use space, including, but not limited to, 
operating and recovery room space, located in or owned by any hospital 
investor, unless such space is leased from the hospital in accordance 
with a lease that complies with all the standards of the space rental 
safe harbor set forth in paragraph (b) of this section; nor may it use 
equipment owned by or services provided by the hospital unless such 
equipment is leased in accordance with a lease that complies with the 
equipment rental safe harbor set forth in paragraph (c) of this section, 
and such services are provided in accordance with a contract that 
complies with the personal services and management contracts safe harbor 
set forth in paragraph (d) of this section.
    (vi) All ancillary services for Federal health care program 
beneficiaries performed at the entity must be directly and integrally 
related to primary procedures performed at the entity, and none may be 
separately billed to Medicare or other Federal health care programs.
    (vii) The hospital may not include on its cost report or any claim 
for payment from a Federal health care program any costs associated with 
the ASC (unless such costs are required to be included by a Federal 
health care program).
    (viii) The hospital may not be in a position to make or influence 
referrals directly or indirectly to any investor or the entity.
    (5) For purposes of paragraph (r) of this section, procedures means 
any procedure or procedures on the list of Medicare-covered procedures 
for ambulatory surgical centers in accordance with regulations issued by 
the Department and group practice means a group practice that meets all 
of the standards of paragraph (p) of this section. Surgical group 
practice means a group practice that meets all of the standards of 
paragraph (p) of this section and is composed exclusively of surgeons 
who meet the requirements of paragraph (r)(1) of this section.
    (s) Referral arrangements for specialty services. As used in section 
1128B of the Act, ``remuneration'' does not include any exchange of 
value among individuals and entities where one party agrees to refer a 
patient to the other party for the provision of a specialty service 
payable in whole or in part under Medicare, Medicaid or any other 
Federal health care programs in return for an agreement on the part of 
the other party to refer that patient back at a mutually agreed upon 
time or circumstance as long as the following four standards are met--
    (1) The mutually agreed upon time or circumstance for referring the 
patient back to the originating individual or entity is clinically 
appropriate.
    (2) The service for which the referral is made is not within the 
medical expertise of the referring individual or entity, but is within 
the special expertise of the other party receiving the referral.
    (3) The parties receive no payment from each other for the referral 
and do not share or split a global fee from any Federal health care 
program in connection with the referred patient.
    (4) Unless both parties belong to the same group practice as defined 
in paragraph (p) of this section, the only exchange of value between the 
parties is the remuneration the parties receive directly from third-
party payors or the patient compensating the parties for the services 
they each have furnished to the patient.
    (t) Price reductions offered to eligible managed care organizations. 
(1) As used in section 1128(B) of the Act, ``remuneration'' does not 
include any payment between:
    (i) An eligible managed care organization and any first tier 
contractor for providing or arranging for items or services, as long as 
the following three standards are met--
    (A) The eligible managed care organization and the first tier 
contractor have an agreement that:
    (1) Is set out in writing and signed by both parties;
    (2) Specifies the items and services covered by the agreement;

[[Page 697]]

    (3) Is for a period of at least one year; and
    (4) Specifies that the first tier contractor cannot claim payment in 
any form directly or indirectly from a Federal health care program for 
items or services covered under the agreement, except for:
    (i) HMOs and competitive medical plans with cost-based contracts 
under section 1876 of the Act where the agreement with the eligible 
managed care organization sets out the arrangements in accordance with 
which the first tier contractor is billing the Federal health care 
program;
    (ii) Federally qualified HMOs without a contract under sections 1854 
or 1876 of the Act, where the agreement with the eligible managed care 
organization sets out the arrangements in accordance with which the 
first tier contractor is billing the Federal health care program; or
    (iii) First tier contractors that are Federally qualified health 
centers that claim supplemental payments from a Federal health care 
program.
    (B) In establishing the terms of the agreement, neither party gives 
or receives remuneration in return for or to induce the provision or 
acceptance of business (other than business covered by the agreement) 
for which payment may be made in whole or in part by a Federal health 
care program on a fee-for-service or cost basis.
    (C) Neither party to the agreement shifts the financial burden of 
the agreement to the extent that increased payments are claimed from a 
Federal health care program.
    (ii) A first tier contractor and a downstream contractor or between 
two downstream contractors to provide or arrange for items or services, 
as long as the following four standards are met--
    (A) The parties have an agreement that:
    (1) Is set out in writing and signed by both parties;
    (2) Specifies the items and services covered by the agreement;
    (3) Is for a period of at least one year; and
    (4) Specifies that the party providing the items or services cannot 
claim payment in any form from a Federal health care program for items 
or services covered under the agreement.
    (B) In establishing the terms of the agreement, neither party gives 
or receives remuneration in return for or to induce the provision or 
acceptance of business (other than business covered by the agreement) 
for which payment may be made in whole or in part by a Federal health 
care program on a fee-for-service or cost basis.
    (C) Neither party shifts the financial burden of the agreement to 
the extent that increased payments are claimed from a Federal health 
care program.
    (D) The agreement between the eligible managed care organization and 
first tier contractor covering the items or services that are covered by 
the agreement between the parties does not involve:
    (1) A Federally qualified health center receiving supplemental 
payments;
    (2) A HMO or CMP with a cost-based contract under section 1876 of 
the Act; or
    (3) A Federally qualified HMO, unless the items or services are 
covered by a risk based contract under sections 1854 or 1876 of the Act.
    (2) For purposes of this paragraph, the following terms are defined 
as follows:
    (i) Downstream contractor means an individual or entity that has a 
subcontract directly or indirectly with a first tier contractor for the 
provision or arrangement of items or services that are covered by an 
agreement between an eligible managed care organization and the first 
tier contractor.
    (ii) Eligible managed care organization \1\ means--
---------------------------------------------------------------------------

    \1\ The eligible managed care organizations in paragraphs 
(u)(2)(ii)(A)-(F) of this section are only eligible with respect to 
items or services covered by the contracts specified in those 
paragraphs.
---------------------------------------------------------------------------

    (A) A HMO or CMP with a risk or cost based contract in accordance 
with section 1876 of the Act;
    (B) Any Medicare Part C health plan that receives a capitated 
payment from Medicare and which must have its total Medicare beneficiary 
cost sharing approved by CMS under section 1854 of the Act;
    (C) Medicaid managed care organizations as defined in section 
1903(m)(1)(A)

[[Page 698]]

that provide or arrange for items or services for Medicaid enrollees 
under a contract in accordance with section 1903(m) of the Act (except 
for fee-for-service plans or medical savings accounts);
    (D) Any other health plans that provide or arrange for items and 
services for Medicaid enrollees in accordance with a risk-based contract 
with a State agency subject to the upper payment limits in Sec.  447.361 
of this title or an equivalent payment cap approved by the Secretary;
    (E) Programs For All Inclusive Care For The Elderly (PACE) under 
sections 1894 and 1934 of the Act, except for for-profit demonstrations 
under sections 4801(h) and 4802(h) of Pub. L. 105-33; or
    (F) A Federally qualified HMO.
    (iii) First tier contractor means an individual or entity that has a 
contract directly with an eligible managed care organization to provide 
or arrange for items or services.
    (iv) Items and services means health care items, devices, supplies 
or services or those services reasonably related to the provision of 
health care items, devices, supplies or services including, but not 
limited to, non-emergency transportation, patient education, attendant 
services, social services (e.g., case management), utilization review 
and quality assurance. Marketing and other pre-enrollment activities are 
not ``items or services'' for purposes of this section.
    (u) Price reductions offered by contractors with substantial 
financial risk to managed care organizations. (1) As used in section 
1128(B) of the Act, ``remuneration'' does not include any payment 
between:
    (i) A qualified managed care plan and a first tier contractor for 
providing or arranging for items or services, where the following five 
standards are met--
    (A) The agreement between the qualified managed care plan and first 
tier contractor must:
    (1) Be in writing and signed by the parties;
    (2) Specify the items and services covered by the agreement;
    (3) Be for a period of a least one year;
    (4) Require participation in a quality assurance program that 
promotes the coordination of care, protects against underutilization and 
specifies patient goals, including measurable outcomes where 
appropriate; and
    (5) Specify a methodology for determining payment that is 
commercially reasonable and consistent with fair market value 
established in an arms-length transaction and includes the intervals at 
which payments will be made and the formula for calculating incentives 
and penalties, if any.
    (B) If a first tier contractor has an investment interest in a 
qualified managed care plan, the investment interest must meet the 
criteria of paragraph (a)(1) of this section.
    (C) The first tier contractor must have substantial financial risk 
for the cost or utilization of services it is obligated to provide 
through one of the following four payment methodologies:
    (1) A periodic fixed payment per patient that does not take into 
account the dates services are provided, the frequency of services, or 
the extent or kind of services provided;
    (2) Percentage of premium;
    (3) Inpatient Federal health care program diagnosis-related groups 
(DRGs) (other than those for psychiatric services);
    (4) Bonus and withhold arrangements, provided--
    (i) The target payment for first tier contractors that are 
individuals or non-institutional providers is at least 20 percent 
greater than the minimum payment, and for first tier contractors that 
are institutional providers, i.e., hospitals and nursing homes, is at 
least 10 percent greater than the minimum payment;
    (ii) The amount at risk, i.e., the bonus or withhold, is earned by a 
first tier contractor in direct proportion to the ratio of the 
contractor's actual utilization to its target utilization;
    (iii) In calculating the percentage in accordance with paragraph 
(u)(1)(i)(C)(4)(i) of this section, both the target payment amount and 
the minimum payment amount include any performance bonus, e.g., payments 
for timely submission of paperwork, continuing medical education, 
meeting attendance, etc., at a level achieved by 75 percent of the first 
tier contractors who are eligible for such payments;

[[Page 699]]

    (iv) Payment amounts, including any bonus or withhold amounts, are 
reasonable given the historical utilization patterns and costs for the 
same or comparable populations in similar managed care arrangements; and
    (v) Alternatively, for a first tier contractor that is a physician, 
the qualified managed care plan has placed the physician at risk for 
referral services in an amount that exceeds the substantial financial 
risk threshold set forth in 42 CFR 417.479(f) and the arrangement is in 
compliance with the stop-loss and beneficiary survey requirements of 42 
CFR 417.479(g).
    (D) Payments for items and services reimbursable by Federal health 
care program must comply with the following two standards--
    (1) The qualified managed care plan (or in the case of a self-funded 
employer plan that contracts with a qualified managed care plan to 
provide administrative services, the self-funded employer plan) must 
submit the claims directly to the Federal health care program, in 
accordance with a valid reassignment agreement, for items or services 
reimbursed by the Federal health care program. (Notwithstanding the 
foregoing, inpatient hospital services, other than psychiatric services, 
will be deemed to comply if the hospital is reimbursed by a Federal 
health care program under a DRG methodology.)
    (2) Payments to first tier contractors and any downstream 
contractors for providing or arranging for items or services reimbursed 
by a Federal health care program must be identical to payment 
arrangements to or between such parties for the same items or services 
provided to other beneficiaries with similar health status, provided 
that such payments may be adjusted where the adjustments are related to 
utilization patterns or costs of providing items or services to the 
relevant population.
    (E) In establishing the terms of an arrangement--
    (1) Neither party gives or receives remuneration in return for or to 
induce the provision or acceptance of business (other than business 
covered by the arrangement) for which payment may be made in whole or in 
part by a Federal health care program on a fee-for-service or cost 
basis; and
    (2) Neither party to the arrangement shifts the financial burden of 
such arrangement to the extent that increased payments are claimed from 
a Federal health care program.
    (ii) A first tier contractor and a downstream contractor, or between 
downstream contractors, to provide or arrange for items or services, as 
long as the following three standards are met--
    (A) Both parties are being paid for the provision or arrangement of 
items or services in accordance with one of the payment methodologies 
set out in paragraph (u)(1)(i)(C) of this section;
    (B) Payment arrangements for items and services reimbursable by a 
Federal health care program comply with paragraph (u)(1)(i)(D) of this 
section; and
    (C) In establishing the terms of an arrangement--
    (1) Neither party gives or receives remuneration in return for or to 
induce the provision or acceptance of business (other than business 
covered by the arrangement) for which payment may be made in whole or in 
part by a Federal health care program on a fee-for-service or cost 
basis; and
    (2) Neither party to the arrangement shifts the financial burden of 
the arrangement to the extent that increased payments are claimed from a 
Federal health care program.
    (2) For purposes of this paragraph, the following terms are defined 
as follows:
    (i) Downstream contractor means an individual or entity that has a 
subcontract directly or indirectly with a first tier contractor for the 
provision or arrangement of items or services that are covered by an 
agreement between a qualified managed care plan and the first tier 
contractor.
    (ii) First tier contractor means an individual or entity that has a 
contract directly with a qualified managed care plan to provide or 
arrange for items or services.
    (iii) Is obligated to provide for a contractor refers to items or 
services:
    (A) Provided directly by an individual or entity and its employees;
    (B) For which an individual or entity is financially responsible, 
but which

[[Page 700]]

are provided by downstream contractors;
    (C) For which an individual or entity makes referrals or 
arrangements; or
    (D) For which an individual or entity receives financial incentives 
based on its own, its provider group's, or its qualified managed care 
plan's performance (or combination thereof).
    (iv) Items and services means health care items, devices, supplies 
or services or those services reasonably related to the provision of 
health care items, devices, supplies or services including, but not 
limited to, non-emergency transportation, patient education, attendant 
services, social services (e.g., case management), utilization review 
and quality assurance. Marketing or other pre-enrollment activities are 
not ``items or services'' for purposes of this definition in this 
paragraph.
    (v) Minimum payment is the guaranteed amount that a provider is 
entitled to receive under an agreement with a first tier or downstream 
contractor or a qualified managed care plan.
    (vi) Qualified managed care plan means a health plan as defined in 
paragraph (l)(2) of this section that:
    (A) Provides a comprehensive range of health services;
    (B) Provides or arranges for--
    (1) Reasonable utilization goals to avoid inappropriate utilization;
    (2) An operational utilization review program;
    (3) A quality assurance program that promotes the coordination of 
care, protects against underutilization, and specifies patient goals, 
including measurable outcomes where appropriate;
    (4) Grievance and hearing procedures;
    (5) Protection of enrollees from incurring financial liability other 
than copayments and deductibles; and
    (6) Treatment for Federal health care program beneficiaries that is 
not different than treatment for other enrollees because of their status 
as Federal health care program beneficiaries; and
    (C) Covers a beneficiary population of which either--
    (1) No more than 10 percent are Medicare beneficiaries, not 
including persons for whom a Federal health care program is the 
secondary payer; or
    (2) No more than 50 percent are Medicare beneficiaries (not 
including persons for whom a Federal health care program is the 
secondary payer), provided that payment of premiums is on a periodic 
basis that does not take into account the dates services are rendered, 
the frequency of services, or the extent or kind of services rendered, 
and provided further that such periodic payments for the non-Federal 
health care program beneficiaries do not take into account the number of 
Federal health care program fee-for-service beneficiaries covered by the 
agreement or the amount of services generated by such beneficiaries.
    (vii) Target payment means the fair market value payment established 
through arms length negotiations that will be earned by an individual or 
entity that:
    (A) Is dependent on the individual or entity's meeting a utilization 
target or range of utilization targets that are set consistent with 
historical utilization rates for the same or comparable populations in 
similar managed care arrangements, whether based on its own, its 
provider group's or the qualified managed care plan's utilization (or a 
combination thereof); and
    (B) Does not include any bonus or fees that the individual or entity 
may earn from exceeding the utilization target.
    (v) Ambulance replenishing. (1) As used in section 1128B of the Act, 
``remuneration'' does not include any gift or transfer of drugs or 
medical supplies (including linens) by a hospital or other receiving 
facility to an ambulance provider for the purpose of replenishing 
comparable drugs or medical supplies (including linens) used by the 
ambulance provider (or a first responder) in connection with the 
transport of a patient by ambulance to the hospital or other receiving 
facility if all of the standards in paragraph (v)(2) of this section are 
satisfied and all of the applicable standards in either paragraph 
(v)(3)(i), (v)(3)(ii) or (v)(3)(iii) of this section are satisfied. 
However, to qualify under paragraph (v), the ambulance that is 
replenished must be used to provide emergency ambulance services an 
average of three times per week, as measured over a reasonable period of 
time. Drugs and medical supplies (including linens) initially used

[[Page 701]]

by a first responder and replenished at the scene of the illness or 
injury by the ambulance provider that transports the patient to the 
hospital or other receiving facility will be deemed to have been used by 
the ambulance provider.
    (2) To qualify under paragraph (v) of this section, the ambulance 
replenishing arrangement must satisfy all of the following four 
conditions--
    (i)(A) Under no circumstances may the ambulance provider (or first 
responder) and the receiving facility both bill for the same replenished 
drug or supply. Replenished drugs or supplies may only be billed 
(including claiming bad debt) to a Federal health care program by either 
the ambulance provider (or first responder) or the receiving facility.
    (B) All billing or claims submission by the receiving facility, 
ambulance provider or first responder for replenished drugs and medical 
supplies used in connection with the transport of a Federal health care 
program beneficiary must comply with all applicable Federal health care 
program payment and coverage rules and regulations.
    (C) Compliance with paragraph (v)(2)(i)(B) of this section will be 
determined separately for the receiving facility and the ambulance 
provider (and first responder, if any), so long as the receiving 
facility, ambulance provider (or first responder) refrains from doing 
anything that would impede the other party or parties from meeting their 
obligations under paragraph (v)(2)(i)(B).
    (ii)(A) The receiving facility or ambulance provider, or both, must
    (1) Maintain records of the replenished drugs and medical supplies 
and the patient transport to which the replenished drugs and medical 
supplies related;
    (2) Provide a copy of such records to the other party within a 
reasonable time (unless the other party is separately maintaining 
records of the replenished drugs and medical supplies); and
    (3) Make those records available to the Secretary promptly upon 
request.
    (B) A pre-hospital care report (including, but not limited to, a 
trip sheet, patient care report or patient encounter report) prepared by 
the ambulance provider and filed with the receiving facility will meet 
the requirements of paragraph (v)(2)(ii)(A) of this section, provided 
that it documents the specific type and amount of medical supplies and 
drugs used on the patient and subsequently replenished.
    (C) For purposes of paragraph (v)(2)(ii) of this section, 
documentation may be maintained and, if required, filed with the other 
party in hard copy or electronically. If a replenishing arrangement 
includes linens, documentation need not be maintained for their 
exchange. If documentation is not maintained for the exchange of linens, 
the receiving facility will be presumed to have provided an exchange of 
comparable clean linens for soiled linens for each ambulance transport 
of a patient to the receiving facility. Records required under paragraph 
(v)(2)(ii)(A) of this section must be maintained for 5 years.
    (iii) The replenishing arrangement must not take into account the 
volume or value of any referrals or business otherwise generated between 
the parties for which payment may be made in whole or in part under any 
Federal health care program (other than the referral of the particular 
patient to whom the replenished drugs and medical supplies were 
furnished).
    (iv) The receiving facility and the ambulance provider otherwise 
comply with all Federal, State, and local laws regulating ambulance 
services, including, but not limited to, emergency services, and the 
provision of drugs and medical supplies, including, but not limited to, 
laws relating to the handling of controlled substances.
    (3) To qualify under paragraph (v) of this section, the arrangement 
must satisfy all of the standards in one of the following three 
categories:
    (i) General replenishing. (A) The receiving facility must replenish 
medical supplies or drugs on an equal basis for all ambulance providers 
that bring patients to the receiving facility in any one of the 
categories described in paragraph (v)(3)(i)(A)(1), (2), or (3) of this 
section. A receiving facility may offer replenishing to one or more of 
the categories and may offer different replenishing arrangements to 
different categories, so long as the replenishing is

[[Page 702]]

conducted uniformly within each category. For example, a receiving 
facility may offer to replenish a broader array of drugs or supplies for 
ambulance providers that do no not charge for their services than for 
ambulance providers that charge for their services. Within each 
category, the receiving facility may limit its replenishing arrangements 
to the replenishing of emergency ambulance transports only. A receiving 
facility may offer replenishing to one or more of the categories--
    (1) All ambulance providers that do not bill any patient or insurer 
(including Federal health care programs) for ambulance services, 
regardless of the payor or the patient's ability to pay (i.e., ambulance 
providers, such as volunteer companies, that provide ambulance services 
without charge to any person or entity);
    (2) All not-for-profit and State or local government ambulance 
service providers (including, but not limited to, municipal and 
volunteer ambulance services providers); or
    (3) All ambulance service providers.
    (B)(1) The replenishing arrangement must be conducted in an open and 
public manner. A replenishing arrangement will be considered to be 
conducted in an open and public manner if one of the following two 
conditions are satisfied:
    (i) A written disclosure of the replenishing program is posted 
conspicuously in the receiving facility's emergency room or other 
location where the ambulance providers deliver patients and copies are 
made available upon request to ambulance providers, Government 
representatives, and members of the public (subject to reasonable 
photocopying charges). The written disclosure can take any reasonable 
form and should include the category of ambulance service providers that 
qualifies for replenishment; the drugs or medical supplies included in 
the replenishment program; and the procedures for documenting the 
replenishment. A sample disclosure form is included in Appendix A to 
subpart C of this part for illustrative purposes only. No written 
contracts between the parties are required for purposes of paragraph 
(v)(3)(i)(B)(1)(i) of this section; or
    (ii) The replenishment arrangement operates in accordance with a 
plan or protocol of general application promulgated by an Emergency 
Medical Services (EMS) Council or comparable entity, agency or 
organization, provided a copy of the plan or protocol is available upon 
request to ambulance providers, Government representatives and members 
of the public (subject to reasonable photocopying charges). While 
parties are encouraged to participate in collaborative, comprehensive, 
community-wide EMS systems to improve the delivery of EMS in their local 
communities, nothing in this paragraph shall be construed as requiring 
the involvement of such organizations or the development or 
implementation of ambulance replenishment plans or protocols by such 
organizations.
    (2) Nothing in this paragraph (v)(3)(i) shall be construed as 
requiring disclosure of confidential proprietary or financial 
information related to the replenishing arrangement (including, but not 
limited to, information about cost, pricing or the volume of replenished 
drugs or supplies) to ambulance providers or members of the general 
public.
    (ii) Fair market value replenishing. (A) Except as otherwise 
provided in paragraph (v)(3)(ii)(B) of this section, the ambulance 
provider must pay the receiving facility fair market value, based on an 
arms-length transaction, for replenished medical supplies; and
    (B) If payment is not made at the same time as the replenishing of 
the medical supplies, the receiving facility and the ambulance provider 
must make commercially reasonable payment arrangements in advance.
    (iii) Government mandated replenishing. The replenishing arrangement 
is undertaken in accordance with a State or local statute, ordinance, 
regulation or binding protocol that requires hospitals or receiving 
facilities in the area subject to such requirement to replenish 
ambulances that deliver patients to the hospital with drugs or medical 
supplies (including linens) that are used during the transport of that 
patient.
    (4) For purposes of paragraph (v) of this section--

[[Page 703]]

    (i) A receiving facility is a hospital or other facility that 
provides emergency medical services.
    (ii) An ambulance provider is a provider or supplier of ambulance 
transport services that provides emergency ambulance services. The term 
does not include a provider of ambulance transport services that 
provides only non-emergency transport services.
    (iii) A first responder includes, but is not limited to, a fire 
department, paramedic service or search and rescue squad that responds 
to an emergency call (through 9-1-1 or other emergency access number) 
and treats the patient, but does not transport the patient to the 
hospital or other receiving facility.
    (iv) An emergency ambulance service is a transport by ambulance 
initiated as a result of a call through 9-1-1 or other emergency access 
number or a call from another acute care facility unable to provide the 
higher level care required by the patient and available at the receiving 
facility.
    (v) Medical supplies includes linens, unless otherwise provided.
    (w) Health centers. As used in section 1128B of the Act, 
``remuneration'' does not include the transfer of any goods, items, 
services, donations or loans (whether the donation or loan is in cash or 
in-kind), or combination thereof from an individual or entity to a 
health center (as defined in this paragraph), as long as the following 
nine standards are met--
    (1)(i) The transfer is made pursuant to a contract, lease, grant, 
loan, or other agreement that--
    (A) Is set out in writing;
    (B) Is signed by the parties; and
    (C) Covers, and specifies the amount of, all goods, items, services, 
donations, or loans to be provided by the individual or entity to the 
health center.
    (ii) The amount of goods, items, services, donations, or loans 
specified in the agreement in accordance with paragraph (w)(1)(i)(C) of 
this section may be a fixed sum, fixed percentage, or set forth by a 
fixed methodology. The amount may not be conditioned on the volume or 
value of Federal health care program business generated between the 
parties. The written agreement will be deemed to cover all goods, items, 
services, donations, or loans provided by the individual or entity to 
the health center as required by paragraph (w)(1)(i)(C) of this section 
if all separate agreements between the individual or entity and the 
health center incorporate each other by reference or if they cross-
reference a master list of agreements that is maintained centrally, is 
kept up to date, and is available for review by the Secretary upon 
request. The master list should be maintained in a manner that preserves 
the historical record of arrangements.
    (2) The goods, items, services, donations, or loans are medical or 
clinical in nature or relate directly to services provided by the health 
center as part of the scope of the health center's section 330 grant 
(including, by way of example, billing services, administrative support 
services, technology support, and enabling services, such as case 
management, transportation, and translation services, that are within 
the scope of the grant).
    (3) The health center reasonably expects the arrangement to 
contribute meaningfully to the health center's ability to maintain or 
increase the availability, or enhance the quality, of services provided 
to a medically underserved population served by the health center, and 
the health center documents the basis for the reasonable expectation 
prior to entering the arrangement. The documentation must be made 
available to the Secretary upon request.
    (4) At reasonable intervals, but at least annually, the health 
center must re-evaluate the arrangement to ensure that the arrangement 
is expected to continue to satisfy the standard set forth in paragraph 
(w)(3) of this section, and must document the re-evaluation 
contemporaneously. The documentation must be made available to the 
Secretary upon request. Arrangements must not be renewed or renegotiated 
unless the health center reasonably expects the standard set forth in 
paragraph (w)(3) of this section to be satisfied in the next agreement 
term. Renewed or renegotiated agreements must comply with the 
requirements of paragraph (w)(3) of this section.
    (5) The individual or entity does not (i) Require the health center 
(or its affiliated health care professionals) to

[[Page 704]]

refer patients to a particular individual or entity, or
    (ii) restrict the health center (or its affiliated health care 
professionals) from referring patients to any individual or entity.
    (6) Individuals and entities that offer to furnish goods, items, or 
services without charge or at a reduced charge to the health center must 
furnish such goods, items, or services to all patients from the health 
center who clinically qualify for the goods, items, or services, 
regardless of the patient's payor status or ability to pay. The 
individual or entity may impose reasonable limits on the aggregate 
volume or value of the goods, items, or services furnished under the 
arrangement with the health center, provided such limits do not take 
into account a patient's payor status or ability to pay.
    (7) The agreement must not restrict the health center's ability, if 
it chooses, to enter into agreements with other providers or suppliers 
of comparable goods, items, or services, or with other lenders or 
donors. Where a health center has multiple individuals or entities 
willing to offer comparable remuneration, the health center must employ 
a reasonable methodology to determine which individuals or entities to 
select and must document its determination. In making these 
determinations, health centers should look to the procurement standards 
for recipients of Federal grants set forth in 45 CFR 74.40 through 
74.48.
    (8) The health center must provide effective notification to 
patients of their freedom to choose any willing provider or supplier. In 
addition, the health center must disclose the existence and nature of an 
agreement under paragraph (w)(1) of this section to any patient who 
inquires. The health center must provide such notification or disclosure 
in a timely fashion and in a manner reasonably calculated to be 
effective and understood by the patient.
    (9) The health center may, at its option, elect to require that an 
individual or entity charge a referred health center patient the same 
rate it charges other similarly situated patients not referred by the 
health center or that the individual or entity charge a referred health 
center patient a reduced rate (where the discount applies to the total 
charge and not just to the cost-sharing portion owed by an insured 
patient).
    For purposes of this paragraph, the term ``health center'' means a 
Federally Qualified Health Center under section 1905(l)(2)(B)(i) or 
1905(l)(2)(B)(ii) of the Act, and ``medically underserved population'' 
means a medically underserved population as defined in regulations at 42 
CFR 51c.102(e).
    (x) Electronic prescribing items and services. As used in section 
1128B of the Act, ``remuneration'' does not include nonmonetary 
remuneration (consisting of items and services in the form of hardware, 
software, or information technology and training services) necessary and 
used solely to receive and transmit electronic prescription information, 
if all of the following conditions are met:
    (1) The items and services are provided by a--
    (i) Hospital to a physician who is a member of its medical staff;
    (ii) Group practice to a prescribing health care professional who is 
a member of the group practice; and
    (iii) A PDP sponsor or MA organization to pharmacists and pharmacies 
participating in the network of such sponsor or organization and to 
prescribing health care professionals.
    (2) The items and services are provided as part of, or are used to 
access, an electronic prescription drug program that meets the 
applicable standards under Medicare Part D at the time the items and 
services are provided.
    (3) The donor (or any person on the donor's behalf) does not take 
any action to limit or restrict the use or compatibility of the items or 
services with other electronic prescribing or electronic health records 
systems.
    (4) For items or services that are of the type that can be used for 
any patient without regard to payor status, the donor does not restrict, 
or take any action to limit, the recipient's right or ability to use the 
items or services for any patient.
    (5) Neither the recipient nor the recipient's practice (or any 
affiliated individual or entity) makes the receipt of

[[Page 705]]

items or services, or the amount or nature of the items or services, a 
condition of doing business with the donor.
    (6) Neither the eligibility of a recipient for the items or 
services, nor the amount or nature of the items or services, is 
determined in a manner that takes into account the volume or value of 
referrals or other business generated between the parties.
    (7) The arrangement is set forth in a written agreement that--
    (i) Is signed by the parties;
    (ii) Specifies the items and services being provided and the donor's 
cost of the items and services; and
    (iii) Covers all of the electronic prescribing items and services to 
be provided by the donor (or affiliated parties). This requirement will 
be met if all separate agreements between the donor (and affiliated 
parties) and the recipient incorporate each other by reference or if 
they cross-reference a master list of agreements that is maintained and 
updated centrally and is available for review by the Secretary upon 
request. The master list should be maintained in a manner that preserves 
the historical record of agreements.
    (8) The donor does not have actual knowledge of, and does not act in 
reckless disregard or deliberate ignorance of, the fact that the 
recipient possesses or has obtained items or services equivalent to 
those provided by the donor.

    Note to paragraph (x): For purposes of paragraph (x) of this 
section, group practice shall have the meaning set forth at 42 CFR 
411.352; member of the group practice shall mean all persons covered by 
the definition of ``member of the group or member of a group practice'' 
at 42 CFR 411.351, as well as other prescribing health care 
professionals who are owners or employees of the group practice; 
prescribing health care professional shall mean a physician or other 
health care professional licensed to prescribe drugs in the State in 
which the drugs are dispensed; PDP sponsor or MA organization shall have 
the meanings set forth at 42 CFR 423.4 and 422.2, respectively; 
prescription information shall mean information about prescriptions for 
drugs or for any other item or service normally accomplished through a 
written prescription; and electronic health record shall mean a 
repository of consumer health status information in computer processable 
form used for clinical diagnosis and treatment for a broad array of 
clinical conditions.

    (y) Electronic health records items and services. As used in section 
1128B of the Act, ``remuneration'' does not include nonmonetary 
remuneration (consisting of items and services in the form of software 
or information technology and training services) necessary and used 
predominantly to create, maintain, transmit, or receive electronic 
health records, if all of the following conditions are met:
    (1) The items and services are provided to an individual or entity 
engaged in the delivery of health care by--
    (i) An individual or entity that provides services covered by a 
Federal health care program and submits claims or requests for payment, 
either directly or through reassignment, to the Federal health care 
program; or
    (ii) A health plan.
    (2) The software is interoperable at the time it is provided to the 
recipient. For purposes of this subparagraph, software is deemed to be 
interoperable if a certifying body recognized by the Secretary has 
certified the software within no more than 12 months prior to the date 
it is provided to the recipient.
    (3) The donor (or any person on the donor's behalf) does not take 
any action to limit or restrict the use, compatibility, or 
interoperability of the items or services with other electronic 
prescribing or electronic health records systems.
    (4) Neither the recipient nor the recipient's practice (or any 
affiliated individual or entity) makes the receipt of items or services, 
or the amount or nature of the items or services, a condition of doing 
business with the donor.
    (5) Neither the eligibility of a recipient for the items or 
services, nor the amount or nature of the items or services, is 
determined in a manner that directly takes into account the volume or 
value of referrals or other business generated between the parties. For 
the purposes of this paragraph (y)(5), the determination is deemed not 
to directly take into account the volume or value of referrals or other 
business generated between the parties if any one of the following 
conditions is met:
    (i) The determination is based on the total number of prescriptions 
written by the recipient (but not the volume or

[[Page 706]]

value of prescriptions dispensed or paid by the donor or billed to a 
Federal health care program);
    (ii) The determination is based on the size of the recipient's 
medical practice (for example, total patients, total patient encounters, 
or total relative value units);
    (iii) The determination is based on the total number of hours that 
the recipient practices medicine;
    (iv) The determination is based on the recipient's overall use of 
automated technology in his or her medical practice (without specific 
reference to the use of technology in connection with referrals made to 
the donor);
    (v) The determination is based on whether the recipient is a member 
of the donor's medical staff, if the donor has a formal medical staff;
    (vi) The determination is based on the level of uncompensated care 
provided by the recipient; or
    (vii) The determination is made in any reasonable and verifiable 
manner that does not directly take into account the volume or value of 
referrals or other business generated between the parties.
    (6) The arrangement is set forth in a written agreement that --
    (i) Is signed by the parties;
    (ii) Specifies the items and services being provided, the donor's 
cost of those items and services, and the amount of the recipient's 
contribution; and
    (iii) Covers all of the electronic health records items and services 
to be provided by the donor (or any affiliate). This requirement will be 
met if all separate agreements between the donor (and affiliated 
parties) and the recipient incorporate each other by reference or if 
they cross-reference a master list of agreements that is maintained and 
updated centrally and is available for review by the Secretary upon 
request. The master list should be maintained in a manner that preserves 
the historical record of agreements.
    (7) The donor does not have actual knowledge of, and does not act in 
reckless disregard or deliberate ignorance of, the fact that the 
recipient possesses or has obtained items or services equivalent to 
those provided by the donor.
    (8) For items or services that are of the type that can be used for 
any patient without regard to payor status, the donor does not restrict, 
or take any action to limit, the recipient's right or ability to use the 
items or services for any patient.
    (9) The items and services do not include staffing of the 
recipient's office and are not used primarily to conduct personal 
business or business unrelated to the recipient's clinical practice or 
clinical operations.
    (10) The electronic health records software contains electronic 
prescribing capability, either through an electronic prescribing 
component or the ability to interface with the recipient's existing 
electronic prescribing system, that meets the applicable standards under 
Medicare Part D at the time the items and services are provided.
    (11) Before receipt of the items and services, the recipient pays 15 
percent of the donor's cost for the items and services. The donor (or 
any affiliated individual or entity) does not finance the recipient's 
payment or loan funds to be used by the recipient to pay for the items 
and services.
    (12) The donor does not shift the costs of the items or services to 
any Federal health care program.
    (13) The transfer of the items and services occurs, and all 
conditions in this paragraph (y) have been satisfied, on or before 
December 31, 2013.

    Note to paragraph (y): For purposes of paragraph (y) of this 
section, health plan shall have the meaning set forth at Sec.  
1001.952(l)(2); interoperable shall mean able to communicate and 
exchange data accurately, effectively, securely, and consistently with 
different information technology systems, software applications, and 
networks, in various settings, and exchange data such that the clinical 
or operational purpose and meaning of the data are preserved and 
unaltered; and electronic health record shall mean a repository of 
consumer health status information in computer processable form used for 
clinical diagnosis

[[Page 707]]

and treatment for a broad array of clinical conditions.

[57 FR 3330, Jan. 29, 1992, as amended at 57 FR 52729, Nov. 5, 1992; 61 
FR 2135, Jan. 25, 1996; 64 FR 63513, Nov. 19, 1999; 64 FR 63551, Nov. 
19, 1999; 64 FR 71317, Dec. 21, 1999; 66 FR 62989, Dec. 4, 2001; 66 FR 
63749, Dec. 10, 2001; 67 FR 11933, Mar. 18, 2002; 71 FR 45136, Aug. 8, 
2006; 72 FR 56644, Oct. 4, 2007]



Sec.  1001.1001  Exclusion of entities owned or controlled by a sanctioned person.

    (a) Circumstance for exclusion. (1) The OIG may exclude an entity 
if:
    (i) A person with a relationship with such entity--
    (A) Has been convicted of a criminal offense as described in 
sections 1128(a) and 1128(b) (1), (2) or (3) of the Act;
    (B) Has had civil money penalties or assessments imposed under 
section 1128A of the Act; or
    (C) Has been excluded from participation in Medicare or any of the 
State health care programs, and
    (ii) Such a person--
    (A)(1) Has a direct or indirect ownership interest (or any 
combination thereof) of 5 percent or more in the entity;
    (2) Is the owner of a whole or part interest in any mortgage, deed 
of trust, note or other obligation secured (in whole or in part) by the 
entity or any of the property assets thereof, in which whole or part 
interest is equal to or exceeds 5 percent of the total property and 
assets of the entity;
    (3) Is an officer or director of the entity, if the entity is 
organized as a corporation;
    (4) Is partner in the entity, if the entity is organized as a 
partnership;
    (5) Is an agent of the entity; or
    (6) Is a managing employee, that is, an individual (including a 
general manager, business manager, administrator or director) who 
exercises operational or managerial control over the entity or part 
thereof, or directly or indirectly conducts the day-to-day operations of 
the entity or part thereof, or
    (B) Was formerly described in paragraph (a)(1)(ii)(A) of this 
section, but is no longer so described because of a transfer of 
ownership or control interest to an immediate family member or a member 
of the person's household as defined in paragraph (a)(2) of this 
section, in anticipation of or following a conviction, assessment of a 
CMP, or imposition of an exclusion.
    (2) For purposes of this section, the term:
    Agent means any person who has express or implied authority to 
obligate or act on behalf of an entity.
    Immediate family member means, a person's husband or wife; natural 
or adoptive parent; child or sibling; stepparent, stepchild, stepbrother 
or stepsister; father-, mother-, daughter-, son-, brother- or sister-in-
law; grandparent or grandchild; or spouse of a grandparent or 
grandchild.
    Indirect ownership interest includes an ownership interest through 
any other entities that ultimately have an ownership interest in the 
entity in issue. (For example, an individual has a 10 percent ownership 
interest in the entity at issue if he or she has a 20 percent ownership 
interest in a corporation that wholly owns a subsidiary that is a 50 
percent owner of the entity in issue.)
    Member of household means, with respect to a person, any individual 
with whom they are sharing a common abode as part of a single family 
unit, including domestic employees and others who live together as a 
family unit. A roomer or boarder is not considered a member of 
household.
    Ownership interest means an interest in:
    (i) The capital, the stock or the profits of the entity, or
    (ii) Any mortgage, deed, trust or note, or other obligation secured 
in whole or in part by the property or assets of the entity.
    (b) Length of exclusion. (1) Except as provided in Sec.  
1001.3002(c), exclusions under this section will be for the same period 
as that of the individual whose relationship with the entity is the 
basis for this exclusion, if the individual has been or is being 
excluded.
    (2) If the individual was not excluded, the length of the entity's 
exclusion will be determined by considering the factors that would have 
been considered if the individual had been excluded.
    (3) An entity excluded under this section may apply for 
reinstatement at

[[Page 708]]

any time in accordance with the procedures set forth in Sec.  
1001.3001(a)(2).

[57 FR 3330, Jan. 29, 1992, as amended at 64 FR 39427, July 22, 1999]



Sec.  1001.1051  Exclusion of individuals with ownership or control interest in sanctioned entities.

    (a) Circumstance for exclusion. The OIG may exclude any individual 
who--
    (1) Has a direct or indirect ownership or control interest in a 
sanctioned entity, and who knows or should know (as defined in section 
1128A(i)(6) of the Act) of the action constituting the basis for the 
conviction or exclusion set forth in paragraph (b) of this section; or
    (2) Is an officer or managing employee (as defined in section 
1126(b) of the Act) of such an entity.
    (b) For purposes of paragraph (a) of this section, the term 
``sanctioned entity'' means an entity that--
    (1) Has been convicted of any offense described in Sec. Sec.  
1001.101 through 1001.401 of this part; or
    (2) Has been terminated or excluded from participation in Medicare, 
Medicaid and all other Federal health care programs.
    (c) Length of exclusion. (1) If the entity has been excluded, the 
length of the individual's exclusion will be for the same period as that 
of the sanctioned entity with which the individual has the prohibited 
relationship.
    (2) If the entity was not excluded, the length of the individual's 
exclusion will be determined by considering the factors that would have 
been considered if the entity had been excluded.
    (3) An individual excluded under this section may apply for 
reinstatement in accordance with the procedures set forth in Sec.  
1001.3001.

[63 FR 46689, Sept. 2, 1998]



Sec.  1001.1101  Failure to disclose certain information.

    (a) Circumstance for exclusion. The OIG may exclude any entity that 
did not fully and accurately, or completely, make disclosures as 
required by section 1124, 1124A or 1126 of the Act, and by part 455, 
subpart B and part 420, subpart C of this title.
    (b) Length of exclusion. The following factors will be considered in 
determining the length of an exclusion under this section--
    (1) The number of instances where full and accurate, or complete, 
disclosure was not made;
    (2) The significance of the undisclosed information;
    (3) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing (The lack of any prior 
record is to be considered neutral);
    (4) Any other facts that bear on the nature or seriousness of the 
conduct;
    (5) The availability of alternative sources of the type of health 
care services provided by the entity; and
    (6) The extent to which the entity knew that the disclosures made 
were not full or accurate.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46689, Sept. 2, 1998]



Sec.  1001.1201  Failure to provide payment information.

    (a) Circumstance for exclusion. The OIG may exclude any individual 
or entity that furnishes items or services for which payment may be made 
under Medicare or any of the State health care programs and that:
    (1) Fails to provide such information as is necessary to determine 
whether such payments are or were due and the amounts thereof, or
    (2) Has refused to permit such examination and duplication of its 
records as may be necessary to verify such information.
    (b) Length of exclusion. The following factors will be considered in 
determining the length of an exclusion under this section--
    (1) The number of instances where information was not provided;
    (2) The circumstances under which such information was not provided;
    (3) The amount of the payments at issue;
    (4) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing (The lack of any prior 
record is to be considered neutral); and
    (5) The availability of alternative sources of the type of health 
care items

[[Page 709]]

or services provided by the individual or entity.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46689, Sept. 2, 1998]



Sec.  1001.1301  Failure to grant immediate access.

    (a) Circumstance for exclusion. (1) The OIG may exclude any 
individual or entity that fails to grant immediate access upon 
reasonable request to--
    (i) The Secretary, a State survey agency or other authorized entity 
for the purpose of determining, in accordance with section 1864(a) of 
the Act, whether--
    (A) An institution is a hospital or skilled nursing facility;
    (B) An agency is a home health agency;
    (C) An agency is a hospice program;
    (D) A facility is a rural health clinic as defined in section 
1861(aa)(2) of the Act, or a comprehensive outpatient rehabilitation 
facility as defined in section 1861(cc)(2) of the Act;
    (E) A laboratory is meeting the requirements of section 1861(s) (15) 
and (16) of the Act, and section 353(f) of the Public Health Service 
Act;
    (F) A clinic, rehabilitation agency or public health agency is 
meeting the requirements of section 1861(p)(4) (A) or (B) of the Act;
    (G) An ambulatory surgical center is meeting the standards specified 
under section 1832(a)(2)(F)(i) of the Act;
    (H) A portable x-ray unit is meeting the requirements of section 
1861(s)(3) of the Act;
    (I) A screening mammography service is meeting the requirements of 
section 1834(c)(3) of the Act;
    (J) An end-stage renal disease facility is meeting the requirements 
of section 1881(b) of the Act;
    (K) A physical therapist in independent practice is meeting the 
requirements of section 1861(p) of the Act;
    (L) An occupational therapist in independent practice is meeting the 
requirements of section 1861(g) of the Act;
    (M) An organ procurement organization meets the requirements of 
section 1138(b) of the Act; or.
    (N) A rural primary care hospital meets the requirements of section 
1820(i)(2) of the Act;
    (ii) The Secretary, a State survey agency or other authorized entity 
to perform the reviews and surveys required under State plans in 
accordance with sections 1902(a)(26) (relating to inpatient mental 
hospital services), 1902(a)(31) (relating to intermediate care 
facilities for the mentally retarded), 1919(g) (relating to nursing 
facilities), 1929(i) (relating to providers of home and community care 
and community care settings), 1902(a)(33) and 1903(g) of the Act;
    (iii) The OIG for the purposes of reviewing records, documents and 
other data necessary to the performance of the Inspector General's 
statutory functions; or
    (iv) A State Medicaid fraud control unit for the purpose of 
conducting its activities.
    (2) For purposes of paragraphs (a)(1)(i) and (a)(1)(ii) of this 
section, the term--
    Failure to grant immediate access means the failure to grant access 
at the time of a reasonable request or to provide a compelling reason 
why access may not be granted.
    Reasonable request means a written request made by a properly 
identified agent of the Secretary, of a State survey agency or of 
another authorized entity, during hours that the facility, agency or 
institution is open for business.
    The request will include a statement of the authority for the 
request, the rights of the entity in responding to the request, the 
definition of reasonable request and immediate access, and the penalties 
for failure to comply, including when the exclusion will take effect.
    (3) For purposes of paragraphs (a)(1)(iii) and (a)(1)(iv) of this 
section, the term--
    Failure to grant immediate access means:
    (i) Except where the OIG or State Medicaid fraud control unit 
reasonably believes that requested documents are about to be altered or 
destroyed, the failure to produce or make available for inspection and 
copying requested records upon reasonable request, or to provide a 
compelling reason why they

[[Page 710]]

cannot be produced, within 24 hours of such request;
    (ii) Where the OIG or State Medicaid fraud control unit has reason 
to believe that requested documents are about to be altered or 
destroyed, the failure to provide access to requested records at the 
time the request is made.
    Reasonable request means a written request for documents, signed by 
a designated representative of the OIG or the State Medicaid fraud 
control unit, and made by a properly identified agent of the OIG or a 
State Medicaid fraud control unit during reasonable business hours, 
where there is information to suggest that the individual or entity has 
violated statutory or regulatory requirements under titles V, XI, XVIII, 
XIX or XX of the Act. The request will include a statement of the 
authority for the request, the rights of the individual or entity in 
responding to the request, the definition of reasonable request and 
immediate access, and the effective date, length, and scope and effect 
of the exclusion that would be imposed for failure to comply with the 
request, and the earliest date that a request for reinstatement would be 
considered.
    (4) Nothing in this section shall in any way limit access otherwise 
authorized under State or Federal law.
    (b) Length of exclusion. (1) An exclusion of an individual under 
this section may be for a period equal to the sum of:
    (i) The length of the period during which the immediate access was 
not granted, and
    (ii) An additional period of up to 90 days.
    (2) The exclusion of an entity may be for a longer period than the 
period in which immediate access was not granted based on consideration 
of the following factors--
    (i) The impact of the failure to grant the requested immediate 
access on Medicare or any of the State health care programs, 
beneficiaries or the public;
    (ii) The circumstances under which such access was refused;
    (iii) The impact of the exclusion on Medicare, Medicaid or any of 
the other Federal health care programs, beneficiaries or the public; and
    (iv) Whether the entity has a documented history of criminal, civil 
or administrative wrongdoing (The lack of any prior record is to be 
considered neutral).
    (3) For purposes of paragraphs (b)(1) and (b)(2) of this section, 
the length of the period in which immediate access was not granted will 
be measured from the time the request is made, or from the time by which 
access was required to be granted, whichever is later.
    (c) The exclusion will be effective as of the date immediate access 
was not granted.

[57 FR 3330, Jan. 29, 1992, as amended at 58 FR 40753, July 30, 1993; 63 
FR 46689, Sept. 2, 1998; 64 FR 39427, July 22, 1999]



Sec.  1001.1401  Violations of PPS corrective action.

    (a) Circumstance for exclusion. The OIG may exclude any hospital 
that CMS determines has failed substantially to comply with a corrective 
action plan required by CMS under section 1886(f)(2)(B) of the Act.
    (b) Length of exclusion. The following factors will be considered in 
determining the length of exclusion under this section--
    (1) The impact of the hospital's failure to comply on Medicare, 
Medicaid or any of the other Federal health care programs, program 
beneficiaries or other individuals;
    (2) The circumstances under which the failure occurred;
    (3) The nature of the failure to comply;
    (4) The impact of the exclusion on Medicare, Medicaid or any of the 
other Federal health care programs, beneficiaries or the public; and
    (5) Whether the individual or entity has a documented history of 
criminal, civil or administrative wrongdoing (The lack of any prior 
record is to be considered neutral).

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46689, Sept. 2, 1998; 64 
FR 39427, July 22, 1999]



Sec.  1001.1501  Default of health education loan or scholarship obligations.

    (a) Circumstance for exclusion. (1) Except as provided in paragraph 
(a)(4) of this section, the OIG may exclude any

[[Page 711]]

individual that the Public Health Service (PHS) determines is in default 
on repayments of scholarship obligations or loans in connection with 
health professions education made or secured in whole or in part by the 
Secretary.
    (2) Before imposing an exclusion in accordance with paragraph (a)(1) 
of this section, the OIG must determine that PHS has taken all 
reasonable administrative steps to secure repayment of the loans or 
obligations. If PHS has offered a Medicare offset arrangement as 
required by section 1892 of the Act, the OIG will find that all 
reasonable steps have been taken.
    (3) The OIG will take into account access of beneficiaries to 
physicians' services for which payment may be made under Medicare, 
Medicaid or other Federal health care programs in determining whether to 
impose an exclusion.
    (4) The OIG will not exclude a physician who is the sole community 
physician or the sole source of essential specialized services in a 
community if a State requests that the physician not be excluded.
    (b) Length of exclusion. The individual will be excluded until such 
time as PHS notifies the OIG that the default has been cured or that 
there is no longer an outstanding debt. Upon such notice, the OIG will 
inform the individual of his or her right to apply for reinstatement.

[57 FR 3330, Jan. 29, 1992, as amended at 64 FR 39427, July 22, 1999; 67 
FR 11935, Mar. 18, 2002]



Sec.  1001.1601  Violations of the limitations on physician charges.

    (a) Circumstance for exclusion. (1) The OIG may exclude a physician 
whom it determines--
    (i) Is a non-participating physician under section 1842(j) of the 
Act;
    (ii) Furnished services to a beneficiary;
    (iii) Knowingly and willfully billed--
    (A) On a repeated basis for such services actual charges in excess 
of the maximum allowable actual charge determined in accordance with 
section 1842(j)(1)(C) of the Act for the period January 1, 1987 through 
December 31, 1990, or
    (B) Individuals enrolled under part B of title XVIII of the Act 
during the statutory freeze for actual charges in excess of such 
physician's actual charges determined in accordance with section 
1842(j)(1)(A) of the Act for the period July 1, 1984 to December 31, 
1986; and''
    (iv) Is not the sole community physician or sole source of essential 
specialized services in the community.
    (2) The OIG will take into account access of beneficiaries to 
physicians' services for which Medicare payment may be made in 
determining whether to impose an exclusion.
    (b) Length of exclusion. (1) In determining the length of an 
exclusion in accordance with this section, the OIG will consider the 
following factors--
    (i) The number of services for which the physician billed in excess 
of the maximum allowable charges;
    (ii) The number of beneficiaries for whom services were billed in 
excess of the maximum allowable charges;
    (iii) The amount of the charges that were in excess of the maximum 
allowable charges;
    (iv) Whether the physician has a documented history of criminal, 
civil or administrative wrongdoing (The lack of any prior record is to 
be considered neutral); and
    (v) The availability of alternative sources of the type of health 
care items or services furnished by the physician.
    (2) The period of exclusion may not exceed 5 years.

[57 FR 3329, Jan. 29, 1992; 57 FR 9669, Mar. 20, 1992, as amended at 63 
FR 46689, Sept. 2, 1998]



Sec.  1001.1701  Billing for services of assistant at surgery during cataract operations.

    (a) Circumstance for exclusion. The OIG may exclude a physician whom 
it determines--
    (1) Has knowingly and willfully presented or caused to be presented 
a claim, or billed an individual enrolled under Part B of the Medicare 
program (or his or her representative) for:
    (i) Services of an assistant at surgery during a cataract operation, 
or
    (ii) Charges that include a charge for an assistant at surgery 
during a cataract operation;

[[Page 712]]

    (2) Has not obtained prior approval for the use of such assistant 
from the appropriate Utilization and Quality Control Quality Improvement 
Organization (QIO) or Medicare carrier; and
    (3) Is not the sole community physician or sole source of essential 
specialized services in the community.
    (b) The OIG will take into account access of beneficiaries to 
physicians' services for which Medicare payment may be made in 
determining whether to impose an exclusion.
    (c) Length of exclusion. (1) In determining the length of an 
exclusion in accordance with this section, the OIG will consider the 
following factors--
    (i) The number of instances for which claims were submitted or 
beneficiaries were billed for unapproved use of assistants during 
cataract operations;
    (ii) The amount of the claims or bills presented;
    (iii) The circumstances under which the claims or bills were made, 
including whether the services were medically necessary;
    (iv) Whether approval for the use of an assistant was requested from 
the QIO or carrier;
    (v) Whether the physician has a documented history of criminal, 
civil or administrative wrongdoing (The lack of any prior record is to 
be considered neutral); and
    (vi) The availability of alternative sources of the type of health 
care items or services furnished by the physician.
    (2) The period of exclusion may not exceed 5 years.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46690, Sept. 2, 1998]



                Sec. Appendix A to Subpart C of Part 1001

    The following is a sample written disclosure for purposes of 
satisfying the requirements of Sec.  1001.952(v)(3)(i)(B)(1)(i) of this 
part. This form is for illustrative purposes only; parties may, but are 
not required to, adapt this sample written disclosure form.

                 Notice of Ambulance Restocking Program

    Hospital X offers the following ambulance restocking program:
    1. We will restock all ambulance providers (other than ambulance 
providers that do not provide emergency services) that bring patients to 
Hospital X [or to a subpart of Hospital X, such as the emergency room] 
in the following category or categories: [insert description of category 
of ambulances to be restocked, i.e., all ambulance providers, all 
ambulance providers that do not charge patients or insurers for their 
services, or all nonprofit and Government ambulance providers]. 
[Optional: We only offer restocking of emergency transports.]
    2. The restocking will include the following drugs and medical 
supplies, and linens, used for patient prior to delivery of the patient 
to Hospital X: [insert description of drugs and medical supplies, and 
linens to be restocked].
    3. The ambulance providers [will/will not] be required to pay for 
the restocked drugs and medical supplies, and linens.
    4. The restocked drugs and medical supplies, and linens, must be 
documented as follows: [insert description consistent with the 
documentation requirements described in Sec.  1001.952(v). By way of 
example only, documentation may be by a patient care report filed with 
the receiving facility within 24 hours of delivery of the patient that 
records the name of the patient, the date of the transport, and the 
relevant drugs and medical supplies.]
    5. This restocking program does not apply to the restocking of 
ambulances that only provide non-emergency services or to the general 
stocking of an ambulance provider's inventory.
    6. To ensure that Hospital X does not bill any Federal health care 
program for restocked drugs or supplies for which a participating 
ambulance provider bills or is eligible to bill, all participating 
ambulance providers must notify Hospital X if they intend to submit 
claims for restocked drugs or supplies to any Federal health care 
program. Participating ambulance providers must agree to work with 
Hospital X to ensure that only one party bills for a particular 
restocked drug or supply.
    7. All participants in this ambulance restocking arrangement that 
bill Federal health care programs for restocked drugs or supplies must 
comply with all applicable Federal program billing and claims filing 
rules and regulations.
    8. For further information about our restocking program or to obtain 
a copy of this notice, please contact [name] at [telephone number].

Dated:--------

/s/--------
Appropriate officer or official

[66 FR 62991, Dec. 4, 2001]



                Subpart D_Waivers and Effect of Exclusion



Sec.  1001.1801  Waivers of exclusions.

    (a) The OIG has the authority to grant or deny a request from a 
State

[[Page 713]]

health care program that an exclusion from that program be waived with 
respect to an individual or entity, except that no waiver may be granted 
with respect to an exclusion under Sec.  1001.101(b). The request must 
be in writing and from an individual directly responsible for 
administering the State health care program.
    (b) With respect to exclusions under Sec.  1001.101(a), a request 
from a State health care program for a waiver of the exclusion will only 
be considered if the individual or entity is the sole community 
physician or the sole source of essential specialized services in a 
community.
    (c) With respect to exclusions imposed under subpart C of this part, 
a request for waiver will only be granted if the OIG determines that 
imposition of the exclusion would not be in the public interest.
    (d) If the basis for the waiver ceases to exist, the waiver will be 
rescinded, and the individual or entity will be excluded for the period 
remaining on the exclusion, measured from the time the exclusion would 
have been imposed if the waiver had not been granted.
    (e) In the event a waiver is granted, it is applicable only to the 
program(s) for which waiver is requested.
    (f) The decision to grant, deny or rescind a request for a waiver is 
not subject to administrative or judicial review.
    (g) The Inspector General may waive the exclusion of an individual 
or entity from participation in the Medicare program in conjunction with 
granting a waiver requested by a State health care program. If a State 
program waiver is rescinded, the derivative waiver of the exclusion from 
Medicare is automatically rescinded.



Sec.  1001.1901  Scope and effect of exclusion.

    (a) Scope of exclusion. Exclusions of individuals and entities under 
this title will be from Medicare, Medicaid and any of the other Federal 
health care programs, as defined in Sec.  1001.2.
    (b) Effect of exclusion on excluded individuals and entities. (1) 
Unless and until an individual or entity is reinstated into the 
Medicare, Medicaid and other Federal health care programs in accordance 
with subpart F of this part, no payment will be made by Medicare, 
Medicaid or any of the other Federal health care programs for any item 
or service furnished, on or after the effective date specified in the 
notice period, by an excluded individual or entity, or at the medical 
direction or on the prescription of a physician or other authorized 
individual who is excluded when the person furnishing such item or 
service knew or had reason to know of the exclusion. This section 
applies regardless of whether an individual or entity has obtained a 
program provider number or equivalent, either as an individual or as a 
member of a group, prior to being reinstated.
    (2) An excluded individual or entity may not take assignment of an 
enrollee's claim on or after the effective date of exclusion.
    (3) An excluded individual or entity that submits, or causes to be 
submitted, claims for items or services furnished during the exclusion 
period is subject to civil money penalty liability under section 
1128A(a)(1)(D) of the Act, and criminal liability under section 
1128B(a)(3) of the Act and other provisions. In addition, submitting 
claims, or causing claims to be submitted or payments to be made for 
items or services furnished, ordered or prescribed, including 
administrative and management services or salary, may serve as the basis 
for denying reinstatement to the programs.
    (c) Exceptions to paragraph (b)(1) of this section. (1) If an 
enrollee of Part B of Medicare submits an otherwise payable claim for 
items or services furnished by an excluded individual or entity, or 
under the medical direction or on the prescription of an excluded 
physician or other authorized individual after the effective date of 
exclusion, CMS will pay the first claim submitted by the enrollee and 
immediately notify the enrollee of the exclusion.
    (2) CMS will not pay an enrollee for items or services furnished by 
an excluded individual or entity, or under the medical direction or on 
the prescription of an excluded physician or other authorized individual 
more than 15 days after the date on the notice to the enrollee, or after 
the effective date of the exclusion, whichever is later.

[[Page 714]]

    (3) Unless the Secretary determines that the health and safety of 
beneficiaries receiving services under Medicare, Medicaid or any of the 
other Federal health care programs warrants the exclusion taking effect 
earlier, payment may be made under such program for up to 30 days after 
the effective date of the exclusion for--
    (i) Inpatient institutional services furnished to an individual who 
was admitted to an excluded institution before the date of the 
exclusion,
    (ii) Home health services and hospice care furnished to an 
individual under a plan of care established before the effective date of 
the exclusion, and
    (iii) Any health care items that are ordered by a practitioner, 
provider or supplier from an excluded manufacturer before the effective 
date of the exclusion and delivered within 30 days of the effective date 
of such exclusion. (For the period October 2, 1998, to October 4, 1999, 
payment may be made under Medicare or a State health care program for up 
to 60 days after the effective date of the exclusion for any health care 
items that are ordered by a practitioner, provider or supplier from an 
excluded manufacturer before the effective date of such exclusion and 
delivered within 60 days of the effect of the exclusion.)
    (4) CMS will not pay any claims submitted by, or for items or 
services ordered or prescribed by, an excluded provider for dates of 
service 15 days or more after the notice of the provider's exclusion was 
mailed to the supplier.
    (5)(i) Notwithstanding the other provisions of this section, payment 
may be made under Medicare, Medicaid or other Federal health care 
programs for certain emergency items or services furnished by an 
excluded individual or entity, or at the medical direction or on the 
prescription of an excluded physician or other authorized individual 
during the period of exclusion. To be payable, a claim for such 
emergency items or services must be accompanied by a sworn statement of 
the person furnishing the items or services specifying the nature of the 
emergency and why the items or services could not have been furnished by 
an individual or entity eligible to furnish or order such items or 
services.
    (ii) Notwithstanding paragraph (c)(5)(i) of this section, no claim 
for emergency items or services will be payable if such items or 
services were provided by an excluded individual who, through an 
employment, contractual or any other arrangement, routinely provides 
emergency health care items or services.

[57 FR 3330, Jan. 29, 1992, as amended at 60 FR 32917, June 26, 1995; 63 
FR 46690, Sept. 2, 1998; 64 FR 39427, July 22, 1999]



                      Subpart E_Notice and Appeals



Sec.  1001.2001  Notice of intent to exclude.

    (a) Except as provided in paragraph (c) of this section, if the OIG 
proposes to exclude an individual or entity in accordance with subpart C 
of this part, or in accordance with subpart B of this part where the 
exclusion is for a period exceeding 5 years, it will send written notice 
of its intent, the basis for the proposed exclusion and the potential 
effect of an exclusion. Within 30 days of receipt of notice, which will 
be deemed to be 5 days after the date on the notice, the individual or 
entity may submit documentary evidence and written argument concerning 
whether the exclusion is warranted and any related issues.
    (b) If the OIG proposes to exclude an individual or entity under the 
provisions of Sec.  1001.701 or Sec.  1001.801 of this part, in 
conjunction with the submission of documentary evidence and written 
argument, an individual or entity may request an opportunity to present 
oral argument to an OIG official.
    (c) Exception. If the OIG proposes to exclude an individual or 
entity under the provisions of Sec. Sec.  1001.1301, 1001.1401 or 
1001.1501 of this part, paragraph (a) of this section will not apply.
    (d) If an entity has a provider agreement under section 1866 of the 
Act, and the OIG proposes to terminate that agreement in accordance with 
section 1866(b)(2)(C) of the Act, the notice provided for in paragraph 
(a) of this section will so state.

[63 FR 46690, Sept. 2, 1998, as amended at 63 FR 57918, Oct. 29, 1998]

[[Page 715]]



Sec.  1001.2002  Notice of exclusion.

    (a) Except as provided in Sec.  1001.2003, if the OIG determines 
that exclusion is warranted, it will send a written notice of this 
decision to the affected individual or entity.
    (b) The exclusion will be effective 20 days from the date of the 
notice.
    (c) The written notice will state--
    (1) The basis for the exclusion;
    (2) The length of the exclusion and, where applicable, the factors 
considered in setting the length;
    (3) The effect of the exclusion;
    (4) The earliest date on which the OIG will consider a request for 
reinstatement;
    (5) The requirements and procedures for reinstatement; and
    (6) The appeal rights available to the excluded individual or 
entity.
    (d) Paragraph (b) of this section does not apply to exclusions 
imposed in accordance with Sec.  1001.1301.
    (e) No later than 15 days prior to the final exhibit exchanges 
required under Sec.  1005.8 of this chapter, the OIG may amend its 
notice letter if information comes to light that justifies the 
imposition of a different period of exclusion other than the one 
proposed in the original notice letter.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46690, Sept. 2, 1998]



Sec.  1001.2003  Notice of proposal to exclude.

    (a) Except as provided in paragraph (c) of this section, if the OIG 
proposes to exclude an individual or entity in accordance with 
Sec. Sec.  1001.901, 1001.951, 1001.1601 or 1001.1701, it will send 
written notice of this decision to the affected individual or entity. 
The written notice will provide the same information set forth in Sec.  
1001.2002(c). If an entity has a provider agreement under section 1866 
of the Act, and the OIG also proposes to terminate that agreement in 
accordance with section 1866(b)(2)(C) of the Act, the notice will so 
indicate. The exclusion will be effective 60 days after the receipt of 
the notice (as defined in Sec.  1005.2 of this chapter) unless, within 
that period, the individual or entity files a written request for a 
hearing in accordance with part 1005 of this chapter. Such request must 
set forth--
    (1) The specific issues or statements in the notice with which the 
individual or entity disagrees;
    (2) The basis for that disagreement;
    (3) The defenses on which reliance is intended;
    (4) Any reasons why the proposed length of exclusion should be 
modified; and
    (5) Reasons why the health or safety of individuals receiving 
services under Medicare or any of the State health care programs does 
not warrant the exclusion going into effect prior to the completion of 
an administrative law judge (ALJ) proceeding in accordance with part 
1005 of this chapter.
    (b)(1) If the individual or entity does not make a written request 
for a hearing as provided for in paragraph (a) of this section, the OIG 
will send a notice of exclusion as described in Sec.  1001.2002.
    (2) If the individual or entity makes a timely written request for a 
hearing and the OIG determines that the health or safety of individuals 
receiving services under Medicare or any of the State health care 
programs does not warrant immediate exclusion, an exclusion will only go 
into effect, with the date of the ALJ's decision, if the ALJ upholds the 
decision to exclude.
    (c) If, prior to issuing a notice of proposal to exclude under 
paragraph (a) of this section, the OIG determines that the health or 
safety of individuals receiving services under Medicare or any of the 
State health care programs warrants the exclusion taking place prior to 
the completion of an ALJ proceeding in accordance with part 1005 of this 
chapter, the OIG will proceed under Sec. Sec.  1001.2001 and 1001.2002.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46690, Sept. 2, 1998; 65 
FR 24414, Apr. 26, 2000]



Sec.  1001.2004  Notice to State agencies.

    HHS will promptly notify each appropriate State agency administering 
or supervising the administration of each State health care program of:
    (a) The facts and circumstances of each exclusion, and
    (b) The period for which the State agency is being directed to 
exclude the individual or entity.

[[Page 716]]



Sec.  1001.2005  Notice to State licensing agencies.

    (a) HHS will promptly notify the appropriate State(s) or local 
agencies or authorities having responsibility for the licensing or 
certification of an individual or entity excluded (or directed to be 
excluded) from participation of the facts and circumstances of the 
exclusion.
    (b) HHS will request that appropriate investigations be made and 
sanctions invoked in accordance with applicable State law and policy, 
and will request that the State or local agency or authority keep the 
Secretary and the OIG fully and currently informed with respect to any 
actions taken in response to the request.



Sec.  1001.2006  Notice to others regarding exclusion.

    (a) HHS will give notice of the exclusion and the effective date to 
the public, to beneficiaries (in accordance with Sec.  1001.1901(c)), 
and, as appropriate, to--
    (1) Any entity in which the excluded individual is known to be 
serving as an employee, administrator, operator, or in which the 
individual is serving in any other capacity and is receiving payment for 
providing services (The lack of this notice will not affect CMS's 
ability to deny payment for services);
    (2) State Medicaid Fraud Control Units;
    (3) Utilization and Quality Control Quality Improvement 
Organizations;
    (4) Hospitals, skilled nursing facilities, home health agencies and 
health maintenance organizations;
    (5) Medical societies and other professional organizations;
    (6) Contractors, health care prepayment plans, private insurance 
companies and other affected agencies and organizations;
    (7) The State and Area Agencies on Aging established under title III 
of the Older Americans Act;
    (8) The National Practitioner Data Bank.
    (9) Other Departmental operating divisions, Federal agencies, and 
other agencies or organizations, as appropriate.
    (b) In the case of an exclusion under Sec.  1001.101 of this 
chapter, if section 304(a)(5) of the Controlled Substances Act (21 
U.S.C. 824(a)(5)) applies, HHS will give notice to the Attorney General 
of the United States of the facts and circumstances of the exclusion and 
the length of the exclusion.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46690, Sept. 2, 1998]



Sec.  1001.2007  Appeal of exclusions.

    (a)(1) Except as provided in Sec.  1001.2003, an individual or 
entity excluded under this Part may file a request for a hearing before 
an ALJ only on the issues of whether:
    (i) The basis for the imposition of the sanction exists, and
    (ii) The length of exclusion is unreasonable.
    (2) When the OIG imposes an exclusion under subpart B of this part 
for a period of 5 years, paragraph (a)(1)(ii) of this section will not 
apply.
    (3) The request for a hearing should contain the information set 
forth in Sec.  1005.2(d) of this chapter.
    (b) The excluded individual or entity has 60 days from the receipt 
of notice of exclusion provided for in Sec.  1001.2002 to file a request 
for such a hearing.
    (c) The standard of proof at a hearing is preponderance of the 
evidence.
    (d) When the exclusion is based on the existence of a criminal 
conviction or a civil judgment imposing liability by Federal, State or 
local court, a determination by another Government agency, or any other 
prior determination where the facts were adjudicated and a final 
decision was made, the basis for the underlying conviction, civil 
judgment or determination is not reviewable and the individual or entity 
may not collaterally attack it either on substantive or procedural 
grounds in this appeal.
    (e) The procedures in part 1005 of this chapter will apply to the 
appeal.

[57 FR 3330, Jan. 29, 1992, as amended at 67 FR 11935, Mar. 18, 2002]



                Subpart F_Reinstatement into the Programs



Sec.  1001.3001  Timing and method of request for reinstatement.

    (a)(1) Except as provided in paragraphs (a)(2) and (a)(3) of this 
section

[[Page 717]]

or in Sec.  1001.501(b)(4) of this part, an excluded individual or 
entity (other than those excluded in accordance with Sec. Sec.  
1001.1001 and 1001.1501) may submit a written request for reinstatement 
to the OIG only after the date specified in the notice of exclusion. 
Obtaining a program provider number or equivalent does not reinstate 
eligibility.
    (2) An entity under Sec.  1001.1001 may apply for reinstatement 
prior to the date specified in the notice of exclusion by submitting a 
written request for reinstatement that includes documentation 
demonstrating that the standards set forth in Sec.  1001.3002(c) have 
been met.
    (3) Upon receipt of a written request, the OIG will require the 
requestor to furnish specific information and authorization to obtain 
information from private health insurers, peer review bodies, probation 
officers, professional associates, investigative agencies and such 
others as may be necessary to determine whether reinstatement should be 
granted.
    (4) Failure to furnish the required information or authorization 
will result in the continuation of the exclusion.
    (b) If a period of exclusion is reduced on appeal (regardless of 
whether further appeal is pending), the individual or entity may request 
reinstatement once the reduced exclusion period expires.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998]



Sec.  1001.3002  Basis for reinstatement.

    (a)(1) The OIG will authorize reinstatement if it determines that--
    (i) The period of exclusion has expired;
    (ii) There are reasonable assurances that the types of actions that 
formed the basis for the original exclusion have not recurred and will 
not recur; and
    (iii) There is no additional basis under sections 1128(a) or (b) or 
1128A of the Act for continuation of the exclusion.
    (2) Submitting claims or causing claims to be submitted or payments 
to be made by the programs for items or services furnished, ordered or 
prescribed, including administrative and management services or salary, 
may serve as the basis for denying reinstatement. This section applies 
regardless of whether an individual or entity has obtained a program 
provider number or equivalent, either as an individual or as a member of 
a group, prior to being reinstated.
    (b) In making the reinstatement determination, the OIG will 
consider--
    (1) Conduct of the individual or entity occurring prior to the date 
of the notice of exclusion, if not known to the OIG at the time of the 
exclusion;
    (2) Conduct of the individual or entity after the date of the notice 
of exclusion;
    (3) Whether all fines, and all debts due and owing (including 
overpayments) to any Federal, State or local government that relate to 
Medicare, Medicaid and all other Federal health care programs, have been 
paid or satisfactory arrangements have been made to fulfill obligations;
    (4) Whether CMS has determined that the individual or entity 
complies with, or has made satisfactory arrangements to fulfill, all of 
the applicable conditions of participation or supplier conditions for 
coverage under the statutes and regulations; and
    (5) [Reserved]
    (6) Whether the individual or entity has, during the period of 
exclusion, submitted claims, or caused claims to be submitted or payment 
to be made by any Federal health care program, for items or services the 
excluded party furnished, ordered or prescribed, including health care 
administrative services.
    (c) If the OIG determines that the criteria in paragraphs (a)(1)(ii) 
and (iii) of this section have been met, an entity excluded in 
accordance with Sec.  1001.1001 will be reinstated upon a determination 
by the OIG that the individual whose conviction, exclusion or civil 
money penalty was the basis for the entity's exclusion--
    (1) Has properly reduced his or her ownership or control interest in 
the entity below 5 percent;
    (2) Is no longer an officer, director, agent or managing employee of 
the entity; or
    (3) Has been reinstated in accordance with paragraph (a) of this 
section or Sec.  1001.3005.

[[Page 718]]

    (d) Reinstatement will not be effective until the OIG grants the 
request and provides notice under Sec.  1001.3003(a) of this part. 
Reinstatement will be effective as provided in the notice.
    (e) A determination with respect to reinstatement is not appealable 
or reviewable except as provided in Sec.  1001.3004.
    (f) An ALJ may not require reinstatement of an individual or entity 
in accordance with this chapter.

[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998; 64 
FR 39427, July 22, 1999]



Sec.  1001.3003  Approval of request for reinstatement.

    (a) If the OIG grants a request for reinstatement, the OIG will--
    (1) Give written notice to the excluded individual or entity 
specifying the date of reinstatement;
    (2) Notify CMS of the date of the individual's or entity's 
reinstatement;
    (3) Notify appropriate Federal and State agencies that administer 
health care programs that the individual or entity has been reinstated 
into all Federal health care programs; and
    (4) To the extent applicable, give notice to others that were 
originally notified of the exclusion.
    (b) A determination by the OIG to reinstate an individual or entity 
has no effect if a Federal health care program has imposed a longer 
period of exclusion under its own authorities.

[64 FR 39428, July 22, 1999]



Sec.  1001.3004  Denial of request for reinstatement.

    (a) If a request for reinstatement is denied, OIG will give written 
notice to the requesting individual or entity. Within 30 days of the 
date on the notice, the excluded individual or entity may submit:
    (1) Documentary evidence and written argument against the continued 
exclusion,
    (2) A written request to present written evidence and oral argument 
to an OIG official, or
    (3) Both documentary evidence and a written request.
    (b) After evaluating any additional evidence submitted by the 
excluded individual or entity (or at the end of the 30-day period, if 
none is submitted), the OIG will send written notice either confirming 
the denial, and indicating that a subsequent request for reinstatement 
will not be considered until at least one year after the date of denial, 
or approving the request consistent with the procedures set forth in 
Sec.  1001.3003(a).
    (c) The decision to deny reinstatement will not be subject to 
administrative or judicial review.



Sec.  1001.3005  Reversed or vacated decisions.

    (a) An individual or entity will be reinstated into Medicare, 
Medicaid and other Federal health care programs retroactive to the 
effective date of the exclusion when such exclusion is based on--
    (1) A conviction that is reversed or vacated on appeal;
    (2) An action by another agency, such as a State agency or licensing 
board, that is reversed or vacated on appeal; or
    (3) An OIG exclusion action that is reversed or vacated at any stage 
of an individual's or entity's administrative appeal process.
    (b) If an individual or entity is reinstated in accordance with 
paragraph (a) of this section, CMS and other Federal health care 
programs will make payment for services covered under such program that 
were furnished or performed during the period of exclusion.
    (c) The OIG will give notice of a reinstatement under this section 
in accordance with Sec.  1001.3003(a).
    (d) An action taken by the OIG under this section will not require 
any other Federal health care program to reinstate the individual or 
entity if such program has imposed an exclusion under its own authority.
    (e) If an action which results in the retroactive reinstatement of 
an individual or entity is subsequently overturned, the OIG may reimpose 
the exclusion for the initial period of time, less the period of time 
that was served prior to the reinstatement of the individual or entity.

[57 FR 3330, Jan. 29, 1992, as amended at 64 FR 39428, July 22, 1999; 67 
FR 11935, Mar. 18, 2002]

[[Page 719]]



PART 1002_PROGRAM INTEGRITY_STATE-INITIATED EXCLUSIONS FROM MEDICAID--Table of Contents




                      Subpart A_General Provisions

Sec.
1002.1 Scope and purpose.
1002.2 General authority.
1002.3 Disclosure by providers and State Medicaid agencies.
1002.100 State plan requirement.

                      Subpart B_Mandatory Exclusion

1002.203 Mandatory exclusion.

                     Subpart C_Permissive Exclusions

1002.210 Permissive exclusions; general authority.
1002.211 Effect of exclusion.
1002.212 State agency notifications.
1002.213 Appeals of exclusions.
1002.214 Basis for reinstatement after State agency-initiated exclusion.
1002.215 Action on request for reinstatement.

 Subpart D_Notification to OIG of State or Local Convictions of Crimes 
                            Against Medicaid

1002.230 Notification of State or local convictions of crimes against 
          Medicaid.

    Authority: 42 U.S.C. 1302, 1320a-3, 1320a-5, 1320a-7, 1396(a)(4)(A), 
1396(p)(1), 1396a(30), 1396a(39), 1396b(a)(6), 1396b(b)(3), 1396b(i)(2) 
and 1396b(q).

    Source: 57 FR 3343, Jan. 29, 1992, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  1002.1  Scope and purpose.

    The regulations in this part specify certain bases upon which 
individuals and entities may, or in some cases must, be excluded from 
participation in the Medicaid program. These regulations specifically 
address the authority of State agencies to exclude on their own 
initiative, regardless of whether the OIG has excluded an individual or 
entity under part 1001 of this chapter. These regulations also delineate 
the States' obligation to inform the OIG of certain Medicaid-related 
convictions.



Sec.  1002.2  General authority.

    (a) In addition to any other authority it may have, a State may 
exclude an individual or entity from participation in the Medicaid 
program for any reason for which the Secretary could exclude that 
individual or entity from participation in the Medicare, Medicaid and 
other Federal health care programs under sections 1128, 1128A or 
1866(b)(2) of the Social Security Act.
    (b) Nothing contained in this part should be construed to limit a 
State's own authority to exclude an individual or entity from Medicaid 
for any reason or period authorized by State law.

[57 FR 3343, Jan. 29, 1992, as amended at 64 FR 39428, July 22, 1999]



Sec.  1002.3  Disclosure by providers and State Medicaid agencies.

    (a) Information that must be disclosed. Before the Medicaid agency 
enters into or renews a provider agreement, or at any time upon written 
request by the Medicaid agency, the provider must disclose to the 
Medicaid agency the identity of any person described in Sec.  
1001.1001(a)(1) of this chapter.
    (b) Notification to Inspector General. (1) The Medicaid agency must 
notify the Inspector General of any disclosures made under paragraph (a) 
of this section within 20 working days from the date it receives the 
information.
    (2) The agency must promptly notify the Inspector General of any 
action it takes on the provider's application for participation in the 
program.
    (3) The agency must also promptly notify the Inspector General of 
any action it takes to limit the ability of an individual or entity to 
participate in its program, regardless of what such an action is called. 
This includes, but is not limited to, suspension actions, settlement 
agreements and situations where an individual or entity voluntarily 
withdraws from the program to avoid a formal sanction.
    (c) Denial or termination of provider participation. (1) The 
Medicaid agency may refuse to enter into or renew an agreement with a 
provider if any person who has ownership or control interest in the 
provider, or who is an agent or managing employee of the provider, has 
been convicted of a criminal offense related to that person's 
involvement in any program established under Medicare, Medicaid or the 
title XX Services program.

[[Page 720]]

    (2) The Medicaid agency may refuse to enter into, or terminate, a 
provider agreement if it determines that the provider did not fully and 
accurately make any disclosure required under paragraph (a) of this 
section.

[57 FR 3343, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998]



Sec.  1002.100  State plan requirement.

    The plan must provide that the requirements of this subpart are met. 
However, the provisions of these regulations are minimum requirements. 
The agency may impose broader sanctions if it has the authority to do so 
under State law.



                      Subpart B_Mandatory Exclusion



Sec.  1002.203  Mandatory exclusion.

    (a) The State agency, in order to receive Federal financial 
participation (FFP), must provide that it will exclude from 
participation any HMO, or entity furnishing services under a waiver 
approved under section 1915(b)(1) of the Act, if such organization or 
entity--
    (1) Could be excluded under Sec.  1001.1001 or Sec.  1001.1051 of 
this chapter, or
    (2) Has, directly or indirectly, a substantial contractual 
relationship with an individual or entity that could be excluded under 
Sec.  1001.1001 or Sec.  1001.1051 of this chapter.
    (b) As used in this section, the term--
    Exclude includes the refusal to enter into or renew a participation 
agreement or the termination of such an agreement.
    Substantial contractual relationship is one in which the sanctioned 
individual described in Sec.  1001.1001 of this chapter has direct or 
indirect business transactions with the organization or entity that, in 
any fiscal year, amount to more than $25,000 or 5 percent of the 
organization's or entity's total operating expenses, whichever is less. 
Business transactions include, but are not limited to, contracts, 
agreements, purchase orders, or leases to obtain services, supplies, 
equipment, space or salaried employment.

[57 FR 3343, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998]



                     Subpart C_Permissive Exclusions



Sec.  1002.210  Permissive exclusions; general authority.

    The State agency must have administrative procedures in place that 
enable it to exclude an individual or entity for any reason for which 
the Secretary could exclude such individual or entity under parts 1001 
or 1003 of this chapter. The period of such exclusion is at the 
discretion of the State agency.



Sec.  1002.211  Effect of exclusion.

    (a) Denial of payment. Except as provided for in Sec.  
1001.1901(c)(3), (c)(4) and (c)(5)(i) of this chapter, no payment may be 
made by the State agency for any item or service furnished on or after 
the effective date specified in the notice by an excluded individual or 
entity, or at the medical direction or on the prescription of a 
physician who is excluded when a person furnishing such item or service 
knew, or had reason to know, of the exclusion.
    (b) Denial of FFP. FFP is not available where the State agency is 
required to deny payment under paragraph (a) of this section. FFP will 
be reinstated at such time as the excluded individual or entity is 
reinstated in the Medicaid program.

[57 FR 3343, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998]



Sec.  1002.212  State agency notifications.

    When the State agency initiates an exclusion under Sec.  1002.210, 
it must provide to the individual or entity subject to the exclusion 
notification consistent with that required in subpart E of part 1001 of 
this chapter, and must notify other State agencies, the State medical 
licensing board (where applicable), the public, beneficiaries, and 
others as provided in Sec. Sec.  1001.2005 and 1001.2006 of this 
chapter.



Sec.  1002.213  Appeals of exclusions.

    Before imposing an exclusion under Sec.  1002.210, the State agency 
must give the individual or entity the opportunity to submit documents 
and written argument against the exclusion. The individual or entity 
must also be given any additional appeals rights that would otherwise be 
available

[[Page 721]]

under procedures established by the State.



Sec.  1002.214  Basis for reinstatement after State agency-initiated exclusion.

    (a) The provisions of this section and Sec.  1002.215 apply to the 
reinstatement in the Medicaid program of all individuals or entities 
excluded in accordance with Sec.  1002.210, if a State affords 
reinstatement opportunity to those excluded parties.
    (b) An individual or entity who has been excluded from Medicaid may 
be reinstated only by the Medicaid agency that imposed the exclusion.
    (c) An individual or entity may submit to the State agency a request 
for reinstatement at any time after the date specified in the notice of 
exclusion.



Sec.  1002.215  Action on request for reinstatement.

    (a) The State agency may grant reinstatement only if it is 
reasonably certain that the types of actions that formed the basis for 
the original exclusion have not recurred and will not recur. In making 
this determination, the agency will consider, in addition to any factors 
set forth in State law--
    (1) The conduct of the individual or entity occurring prior to the 
date of the notice of exclusion, if not known to the agency at the time 
of the exclusion;
    (2) The conduct of the individual or entity after the date of the 
notice of exclusion; and
    (3) Whether all fines, and all debts due and owing (including 
overpayments) to any Federal, State or local government that relate to 
Medicare or any of the State health care programs, have been paid, or 
satisfactory arrangements have been made, that fulfill these 
obligations.
    (b) Notice of action on request for reinstatement. (1) If the State 
agency approves the request for reinstatement, it must give written 
notice to the excluded party, and to all others who were informed of the 
exclusion in accordance with Sec.  1002.212, specifying the date on 
which Medicaid program participation may resume.
    (2) If the State agency does not approve the request for 
reinstatement, it will notify the excluded party of its decision. Any 
appeal of a denial of reinstatement will be in accordance with State 
procedures and need not be subject to administrative or judicial review, 
unless required by State law.



 Subpart D_Notification to OIG of State or Local Convictions of Crimes 
                            Against Medicaid



Sec.  1002.230  Notification of State or local convictions of crimes against Medicaid.

    (a) The State agency must notify the OIG whenever a State or local 
court has convicted an individual who is receiving reimbursement under 
Medicaid of a criminal offense related to participation in the delivery 
of health care items or services under the Medicaid program, except 
where the State Medicaid Fraud Control Unit (MFCU) has so notified the 
OIG.
    (b) If the State agency was involved in the investigation or 
prosecution of the case, it must send notice within 15 days after the 
conviction.
    (c) If the State agency was not so involved, it must give notice 
within 15 days after it learns of the conviction.



PART 1003_CIVIL MONEY PENALTIES, ASSESSMENTS AND EXCLUSIONS--Table of Contents




Sec.
1003.100 Basis and purpose.
1003.101 Definitions.
1003.102 Basis for civil money penalties and assessments.
1003.103 Amount of penalty.
1003.104 Amount of assessment.
1003.105 Exclusion from participation in Medicare, Medicaid and all 
          Federal health care programs.
1003.106 Determinations regarding the amount of the penalty and 
          assessment.
1003.107 Determinations regarding exclusion.
1003.108 Penalty, assessment, and exclusion not exclusive.
1003.109 Notice of proposed determination.
1003.110 Failure to request a hearing.
1003.114 Collateral estoppel.
1003.126 Settlement.
1003.127 Judicial review.
1003.128 Collection of penalty and assessment.

[[Page 722]]

1003.129 Notice to other agencies.
1003.132 Limitations.
1003.133 Statistical sampling.
1003.134 Effect of exclusion.
1003.135 Reinstatement.

    Authority: 42 U.S.C. 262a, 1302, 1320-7, 1320a-7a, 1320b-10, 
1395u(j), 1395u(k), 1395cc(j), 1395w-141(i)(3), 1395dd(d)(1), 1395mm, 
1395nn(g), 1395ss(d), 1396b(m), 11131(c), and 11137(b)(2).

    Source: 51 FR 34777, Sept. 30, 1986, unless otherwise noted.



Sec.  1003.100  Basis and purpose.

    (a)Basis. This part implements sections 1128(c), 1128A, 1140, 1860D-
31(i)(3), 1876(i)(6), 1877(g), 1882(d) and 1903(m)(5) of the Social 
Security Act; sections 421(c) and 427(b)(2) of Pub. L. 99-660; and 
section 201(i) of Pub. L. 107-188 (42 U.S.C. 1320-7(c), 1320a-7a, 1320b-
10, 1395w-141(i)(3), 1395dd(d)(1), 1395mm, 1395ss(d), 1396b(m), 
11131(c), 11137(b)(2) and 262).
    (b) Purpose. This part--
    (1) Provides for the imposition of civil money penalties and, as 
applicable, assessments against persons who--
    (i) Have knowingly submitted certain prohibited claims under Federal 
health care programs;
    (ii) Seek payment in violation of the terms of an agreement or a 
limitation on charges or payments under the Medicare program, or a 
requirement not to charge in excess of the amount permitted under the 
Medicaid program;
    (iii) Give false or misleading information that might affect the 
decision to discharge a Medicare patient from the hospital;
    (iv)(A) Fail to report information concerning medical malpractice 
payments or who improperly disclose, use or permit access to information 
reported under part B of title IV of Public Law 99-660, and regulations 
specified in 45 CFR part 60, or
    (B) Are health plans and fail to report information concerning 
sanctions or other adverse actions imposed on providers as required to 
be reported to the Healthcare Integrity and Protection Data Bank (HIPDB) 
in accordance with section 1128E of the Act;
    (v) Misuse certain Departmental and Medicare and Medicaid program 
words, letters symbols or emblems;
    (vi) Violate a requirement of section 1867 of the Act or Sec.  
489.24 of this title;
    (vii) Substantially fail to provide an enrollee with required 
medically necessary items and services; engage in certain marketing, 
enrollment, reporting, claims payment, employment or contracting abuses; 
or do not meet the requirements for physician incentive plans for 
Medicare specified in Sec. Sec.  417.479(d) through (f) of this title;
    (viii) Present or cause to be presented a bill or claim for 
designated health services (as defined in Sec.  411.351 of this title) 
that they know, or should know, were furnished in accordance with a 
referral prohibited under Sec.  411.353 of this title;
    (ix) Have collected amounts that they know or should know were 
billed in violation of Sec.  411.353 of this title and have not refunded 
the amounts collected on a timely basis;
    (x) Are physicians or entities that enter into an arrangement or 
scheme that they know or should know has as a principal purpose the 
assuring of referrals by the physician to a particular entity which, if 
made directly, would violate the provisions of Sec.  411.353 of this 
title;
    (xi) Are excluded, and who retain an ownership or control interest 
of five percent or more in an entity participating in Medicare or a 
State health care program, or who are officers or managing employees of 
such an entity (as defined in section 1126(b) of the Act);
    (xii) Offer inducements that they know or should know are likely to 
influence Medicare or State health care program beneficiaries to order 
or receive particular items or services;
    (xiii) Are physicians who knowingly misrepresent that a Medicare 
beneficiary requires home health services;
    (xiv) Have submitted, or caused to be submitted, certain prohibited 
claims, including claims for services rendered by excluded individuals 
employed by or otherwise under contract with such person, under one or 
more Federal health care programs;
    (xv) Violate the Federal health care programs' anti-kickback statute 
as set forth in section 1128B of the Act;
    (xvi) Violate the provisions of part 73 of this title, implementing 
section 351A(b) and (c) of the Public Health

[[Page 723]]

Service Act, with respect to the possession and use within the United 
States, receipt from outside the United States, and transfer within the 
United States, of select agents and toxins in use, or transfer of listed 
biological agents and toxins; or
    (xvii) Violate the provisions of part 403, subpart H of this title, 
implementing the Medicare prescription drug discount card and 
transitional assistance program, by misleading or defrauding program 
beneficiaries, by overcharging a discount program enrollee, or by 
misusing transitional assistance funds.
    (2) Provides for the exclusion of persons from the Medicare or State 
health care programs against whom a civil money penalty or assessment 
has been imposed, and the basis for reinstatement of persons who have 
been excluded; and
    (3) Sets forth the appeal rights of persons subject to a penalty, 
assessment and exclusion.

[65 FR 24414, Apr. 26, 2000, as amended at 67 FR 11935, Mar. 18, 2002; 
67 FR 76905, Dec. 13, 2002; 69 FR 28845, May 19, 2004]



Sec.  1003.101  Definitions.

    For purposes of this part:
    Act means the Social Security Act.
    Adverse effect means medical care has not been provided and the 
failure to provide such necessary medical care has presented an imminent 
danger to the health, safety, or well-being of the patient or has placed 
the patient unnecessarily in a high-risk situation.
    ALJ means an Administrative Law Judge.
    Assessment means the amount described in Sec.  1003.104, and 
includes the plural of that term.
    Claim means an application for payment for an item or service to a 
Federal health care program (as defined in section 1128B(f) of the Act).
    CMS stands for Centers for Medicare & Medicaid Services, formerly 
the Health Care Financing Administration (HCFA).
    Contracting organization means a public or private entity, including 
of a health maintenance organization (HMO), competitive medical plan, or 
health insuring organization (HIO) which meets the requirements of 
section 1876(b) of the Act or is subject to the requirements in section 
1903(m)(2)(A) of the Act and which has contracted with the Department or 
a State to furnish services to Medicare beneficiaries or Medicaid 
recipients.
    Department means the Department of Health and Human Services.
    Enrollee means an individual who is eligible for Medicare or 
Medicaid and who enters into an agreement to receive services from a 
contracting organization that contracts with the Department under title 
XVIII or title XIX of the Act.
    Exclusion means the temporary or permanent barring of a person from 
participation in a Federal health care program (as defined in section 
1128B(f) of the Act).
    Inspector General means the Inspector General of the Department or 
his or her designees.
    Item or service includes--
    (a) Any item, device, medical supply or service provided to a 
patient (i) which is listed in an itemized claim for program payment or 
a request for payment, or (ii) for which payment is included in other 
Federal or State health care reimbursement methods, such as a 
prospective payment system; and
    (b) In the case of a claim based on costs, any entry or omission in 
a cost report, books of account or other documents supporting the claim.
    Maternal and Child Health Services Block Grant program means the 
program authorized under Title V of the Act.
    Medicaid means the program of grants to the States for medical 
assistance authorized under title XIX of the Act.
    Medical malpractice claim or action means a written complaint or 
claim demanding payment based on a physician's, dentist's or other 
health care practitioner's provision of, or failure to provide health 
care services, and includes the filing of a cause of action based on the 
law of tort brought in any State or Federal court or other adjudicative 
body.
    Medicare means the program of health insurance for the aged and 
disabled authorized under Title XVIII of the Act.

[[Page 724]]

    Participating hospital means (1) a hospital or (2) a rural primary 
care hospital as defined in section 1861(mm)(1) of the Act that has 
entered into a Medicare provider agreement under section 1866 of the 
Act.
    Penalty means the amount described in Sec.  1003.103 and includes 
the plural of that term.
    Person means an individual, trust or estate, partnership, 
corporation, professional association or corporation, or other entity, 
public or private.
    Physician incentive plan means any compensation arrangement between 
a contracting organization and a physician group that may directly or 
indirectly have the effect of reducing or limiting services provided 
with respect to enrollees in the organization.
    Preventive care, for purposes of the definition of the term 
Remuneration as set forth in this section and the preventive care 
exception to section 231(h) of HIPAA, means any service that--
    (1) Is a prenatal service or a post-natal well-baby visit or is a 
specific clinical service described in the current U.S. Preventive 
Services Task Force's Guide to Clinical Preventive Services, and
    (2) Is reimbursable in whole or in part by Medicare or an applicable 
State health care program.
    Remuneration, as set forth in Sec.  1003.102(b)(13) of this part, is 
consistent with the definition contained in section 1128A(i)(6) of the 
Act, and includes the waiver of coinsurance and deductible amounts (or 
any part thereof) and transfers of items or services for free or for 
other than fair market value. The term ``remuneration'' does not 
include--
    (1) The waiver of coinsurance and deductible amounts by a person, if 
the waiver is not offered as part of any advertisement or solicitation; 
the person does not routinely waive coinsurance or deductible amounts; 
and the person waives coinsurance and deductible amounts after 
determining in good faith that the individual is in financial need or 
failure by the person to collect coinsurance or deductible amounts after 
making reasonable collection efforts;
    (2) Any permissible practice as specified in section 1128B(b)(3) of 
the Act or in regulations issued by the Secretary;
    (3) Differentials in coinsurance and deductible amounts as part of a 
benefit plan design (as long as the differentials have been disclosed in 
writing to all beneficiaries, third party payers and providers), to whom 
claims are presented; or
    (4) Incentives given to individuals to promote the delivery of 
preventive care services where the delivery of such services is not tied 
(directly or indirectly) to the provision of other services reimbursed 
in whole or in part by Medicare or an applicable State health care 
program. Such incentives may include the provision of preventive care, 
but may not include--
    (i) Cash or instruments convertible to cash; or
    (ii) An incentive the value of which is disproportionally large in 
relationship to the value of the preventive care service (i.e., either 
the value of the service itself or the future health care costs 
reasonably expected to be avoided as a result of the preventive care).
    Request for payment means an application submitted by a person to 
any person for payment for an item or service.
    Respondent means the person upon whom the Department has imposed, or 
proposes to impose, a penalty, assessment or exclusion.
    Responsible physician means a physician who is responsible for the 
examination, treatment, or transfer of an individual who comes to a 
participating hospital's emergency department seeking assistance and 
includes a physician on call for the care of such individual.
    Secretary means the Secretary of the Department or his or her 
designees.
    Select agents and toxins means agents and toxins that are listed by 
the HHS Secretary as having the potential to pose a severe threat to 
public health and safety, in accordance with section 351A(a)(1) of the 
Public Health Service Act.
    Should know or should have known means that a person, with respect 
to information--
    (1) Acts in deliberate ignorance of the truth or falsity of the 
information; or

[[Page 725]]

    (2) Acts in reckless disregard of the truth or falsity of the 
information. For purposes of this definition, no proof of specific 
intent to defraud is required.
    Social Services Block Grant program means the program authorized 
under title XX of the Social Security Act.
    State includes the District of Columbia, Puerto Rico, the Virgin 
Islands, Guam, American Samoa, the Northern Mariana Islands, and the 
Trust Territory of the Pacific Islands.
    State health care program means a State plan approved under title 
XIX of the Act, any program receiving funds under title V of the Act or 
from an allotment to a State under such title, or any program receiving 
funds under title XX of the Act or from an allotment to a State under 
such title.
    Timely basis means, in accordance with Sec.  1003.102(b)(9) of this 
part, the 60-day period from the time the prohibited amounts are 
collected by the individual or the entity.
    Transitional assistance means the subsidy funds that Medicare 
beneficiaries enrolled in the prescription drug discount card and 
transitional assistance program may apply toward the cost of covered 
discount card drugs in the manner described in Sec.  403.808(d) of this 
title.

[51 FR 34777, Sept. 30, 1986, as amended at 56 FR 28492, June 21, 1991; 
57 FR 3345, Jan. 29, 1992; 59 FR 32124, June 22, 1994; 59 FR 36086, July 
15, 1994; 60 FR 16584, Mar. 31, 1995; 61 FR 13449, Mar. 27, 1996; 65 FR 
24415, Apr. 26, 2000; 65 FR 35584, June 5, 2000; 66 FR 39452, July 31, 
2001; 67 FR 11935, Mar. 18, 2002; 67 FR 76905, Dec. 13, 2002; 69 FR 
28845, May 19, 2004]



Sec.  1003.102  Basis for civil money penalties and assessments.

    (a) The OIG may impose a penalty and assessment against any person 
whom it determines in accordance with this part has knowingly presented, 
or caused to be presented, a claim which is for--
    (1) An item or service that the person knew, or should have known, 
was not provided as claimed, including a claim that is part of a pattern 
or practice of claims based on codes that the person knows or should 
know will result in greater payment to the person than the code 
applicable to the item or service actually provided;
    (2) An item or service for which the person knew, or should have 
known, that the claim was false or fraudulent, including a claim for any 
item or service furnished by an excluded individual employed by or 
otherwise under contract with that person;
    (3) An item or service furnished during a period in which the person 
was excluded from participation in the Federal health care program to 
which the claim was made;
    (4) A physician's services (or an item or service) for which the 
person knew, or should have known, that the individual who furnished (or 
supervised the furnishing of) the service--
    (i) Was not licensed as a physician;
    (ii) Was licensed as a physician, but such license had been obtained 
through a misrepresentation of material fact (including cheating on an 
examination required for licensing); or
    (iii) Represented to the patient at the time the service was 
furnished that the physician was certified in a medical specialty board 
when he or she was not so certified;
    (5) A payment that such person knows, or should know, may not be 
made under Sec.  411.353 of this title; or
    (6) An item or service that a person knows or should know is 
medically unnecessary, and which is part of a pattern of such claims.
    (b) The OIG may impose a penalty, and where authorized, an 
assessment against any person (including an insurance company in the 
case of paragraphs (b)(5) and (b)(6) of this section) whom it determines 
in accordance with this part--
    (1) Has knowingly presented or caused to be presented a request for 
payment in violation of the terms of--
    (i) An agreement to accept payments on the basis of an assignment 
under section 1842(b)(3)(B)(ii) of the Act;
    (ii) An agreement with a State agency or other requirement of a 
State Medicaid plan not to charge a person for an item or service in 
excess of the amount permitted to be charged;
    (iii) An agreement to be a participating physician or supplier under 
section 1842(h)(1); or
    (iv) An agreement in accordance with section 1866(a)(1)(G) of the 
Act not to

[[Page 726]]

charge any person for inpatient hospital services for which payment had 
been denied or reduced under section 1886(f)(2) of the Act.
    (2)-(3) [Reserved]
    (4) Has knowingly given or caused to be given to any person, in the 
case of inpatient hospital services subject to the provisions of section 
1886 of the Act, information that he or she knew, or should have known, 
was false or misleading and that could reasonably have been expected to 
influence the decision when to discharge such person or another person 
from the hospital.
    (5) Fails to report information concerning--
    (i) A payment made under an insurance policy, self-insurance or 
otherwise, for the benefit of a physician, dentist or other health care 
practitioner in settlement of, or in satisfaction in whole or in part 
of, a medical malpractice claim or action or a judgment against such a 
physician, dentist or other practitioner in accordance with section 421 
of Public Law 99-660 (42 U.S.C. 11131) and as required by regulations at 
45 CFR part 60; or
    (ii) An adverse action required to be reported to the Healthcare 
Integrity and Protection Data Bank as established by section 221 of 
Public Law 104-191 and set forth in section 1128E of the Act.
    (6) Improperly discloses, uses or permits access to information 
reported in accordance with part B of title IV of Pub. L. 99-660, in 
violation of section 427 of Pub. L. 99-660 (42 U.S.C. 11137) or 
regulations at 45 CFR part 60. (The disclosure of information reported 
in accordance with part B of title IV in response to a subpoena or a 
discovery request is considered to be an improper disclosure in 
violation of section 427 of Pub. L. 99-660. However, disclosure or 
release by an entity of original documents or underlying records from 
which the reported information is obtained or derived is not considered 
to be an improper disclosure in violation of section 427 of Pub. L. 99-
660.)
    (7) Has made use of the words, letters, symbols or emblems as 
defined in paragraph (b)(7)(i) of this section in such a manner that 
such person knew or should have known would convey, or in a manner which 
reasonably could be interpreted or construed as conveying, the false 
impression that an advertisement, solicitation or other item was 
authorized, approved or endorsed by the Department or CMS, or that such 
person or organization has some connection with or authorization from 
the Department or CMS. Civil money penalties--
    (i) May be imposed, regardless of the use of a disclaimer of 
affiliation with the United States Government, the Department or its 
programs, for misuse of--
    (A) The words ``Department of Health and Human Services,'' ``Health 
and Human Services,'' ``Centers for Medicare & Medicaid Services,'' 
``Medicare,'' or ``Medicaid,'' or any other combination or variation of 
such words;
    (B) The letters ``DHHS,'' ``HHS,'' or ``CMS,'' or any other 
combination or variation of such letters; or
    (C) A symbol or emblem of the Department or CMS (including the 
design of, or a reasonable facsimile of the design of, the Medicare 
card, the check used for payment of benefits under title II, or 
envelopes or other stationery used by the Department or CMS) or any 
other combination or variation of such symbols or emblems; and
    (ii) Will not be imposed against any agency or instrumentality of a 
State, or political subdivision of the State, that makes use of any 
symbol or emblem, or any words or letters which specifically identifies 
that agency or instrumentality of the State or political subdivision.
    (8) Is a contracting organization that CMS determines has committed 
an act or failed to comply with the requirements set forth in Sec.  
417.500(a) or Sec.  434.67(a) of this title or failed to comply with the 
requirement set forth in Sec.  434.80(c) of this title.
    (9) Has not refunded on a timely basis, as defined in Sec.  1003.101 
of this part, amounts collected as the result of billing an individual, 
third party payer or other entity for a designated health service that 
was provided in accordance with a prohibited referral as described in 
Sec.  411.353 of this title.
    (10) Is a physician or entity that enters into--

[[Page 727]]

    (i) A cross referral arrangement, for example, whereby the physician 
owners of entity ``X'' refer to entity ``Y,'' and the physician owners 
of entity ``Y'' refer to entity ``X'' in violation of Sec.  411.353 of 
this title, or
    (ii) Any other arrangement or scheme that the physician or entity 
knows, or should know, has a principal purpose of circumventing the 
prohibitions of Sec.  411.353 of this title.
    (11) Has violated section 1128B of the Act by unlawfully offering, 
paying, soliciting or receiving remuneration in return for the referral 
of business paid for by Medicare, Medicaid or other Federal health care 
programs.
    (12) Who is not an organization, agency or other entity, and who is 
excluded from participating in Medicare or a State health care program 
in accordance with sections 1128 or 1128A of the Act, and who--
    (i) Knows or should know of the action constituting the basis for 
the exclusion, and retains a direct or indirect ownership or control 
interest of five percent or more in an entity that participates in 
Medicare or a State health care program; or
    (ii) Is an officer or managing employee (as defined in section 
1126(b) of the Act) of such entity.
    (13) Offers or transfers remuneration (as defined in Sec.  1003.101 
of this part) to any individual eligible for benefits under Medicare or 
a State health care program, that such person knows or should know is 
likely to influence such individual to order or to receive from a 
particular provider, practitioner or supplier any item or service for 
which payment may be made, in whole or in part, under Medicare or a 
State health care program.
    (14) Is a physician and who executes a document falsely by 
certifying that a Medicare beneficiary requires home health services 
when the physician knows that the beneficiary does not meet the 
eligibility requirements set forth in sections 1814(a)(2)(C) or 
1835(a)(2)(A) of the Act.
    (15) Has knowingly and willfully presented, or caused to be 
presented, a bill or request for payment for items and services 
furnished to a hospital patient for which payment may be made under the 
Medicare or another Federal health care program, if that bill or request 
is inconsistent with an arrangement under section 1866(a)(1)(H) of the 
Act, or violates the requirements for such an arrangement.
    (16) Is involved in the possession or use in the United States, 
receipt from outside the United States, or transfer within the United 
States, of select agents and toxins in violation of part 73 of this 
chapter as determined by the HHS Secretary, in accordance with sections 
351A(b) and (c) of the Public Health Service Act.
    (17) Is an endorsed sponsor under the Medicare prescription drug 
discount card program who knowingly misrepresented or falsified 
information in outreach material or comparable material provided to a 
program enrollee or other person.
    (18) Is an endorsed sponsor under the Medicare prescription drug 
discount card program who knowingly charged a program enrollee in 
violation of the terms of the endorsement contract.
    (19) Is an endorsed sponsor under the Medicare prescription drug 
discount card program who knowingly used transitional assistance funds 
of any program enrollee in any manner that is inconsistent with the 
purpose of the transitional assistance program.
    (c)(1) The Office of the Inspector General (OIG) may impose a 
penalty for violations of section 1867 of the Act or Sec.  489.24 of 
this title against--
    (i) Any participating hospital with an emergency department that--
    (A) Knowingly violates the statute on or after August 1, 1986 or;
    (B) Negligently violates the statute on or after May 1, 1991; and
    (ii) Any responsible physician who--
    (A) Knowingly violates the statute on or after August 1, 1986;
    (B) Negligently violates the statute on or after May 1, 1991;
    (C) Signs a certification under section 1867(c)(1)(A) of the Act if 
the physician knew or should have known that the benefits of transfer to 
another facility did not outweigh the risks of such a transfer; or
    (D) Misrepresents an individual's condition or other information, 
including a hospital's obligations under this section.

[[Page 728]]

    (2) For purposes of this section, a responsible physician or 
hospital ``knowingly'' violates section 1867 of the Act if the 
responsible physician or hospital recklessly disregards, or deliberately 
ignores a material fact.
    (d)(1) In any case in which it is determined that more than one 
person was responsible for presenting or causing to be presented a claim 
as described in paragraph (a) of this section, each such person may be 
held liable for the penalty prescribed by this part, and an assessment 
may be imposed against any one such person or jointly and severally 
against two or more such persons, but the aggregate amount of the 
assessments collected may not exceed the amount that could be assessed 
if only one person was responsible.
    (2) In any case in which it is determined that more than one person 
was responsible for presenting or causing to be presented a request for 
payment or for giving false or misleading information as described in 
paragraph (b) of this section, each such person may be held liable for 
the penalty prescribed by this part.
    (3) In any case in which it is determined that more than one person 
was responsible for failing to report information that is required to be 
reported on a medical malpractice payment, or for improperly disclosing, 
using, or permitting access to information, as described in paragraphs 
(b)(5) and (b)(6) of this section, each such person may be held liable 
for the penalty prescribed by this part.
    (4) In any case in which it is determined that more than one 
responsible physician violated the provisions of section 1867 of the Act 
or of Sec.  489.24 of this title, a penalty may be imposed against each 
responsible physician.
    (5) Under this section, a principal is liable for penalties and 
assessments for the actions of his or her agent acting within the scope 
of the agency.
    (e) For purposes of this section, the term ``knowingly'' is defined 
consistent with the definition set forth in the Civil False Claims Act 
(31 U.S.C. 3729(b)), that is, a person, with respect to information, has 
actual knowledge of information, acts in deliberate ignorance of the 
truth or falsity of the information, or acts in reckless disregard of 
the truth or falsity of the information, and that no proof of specific 
intent to defraud is required.

[57 FR 3345, Jan. 29, 1992; 57 FR 9670, Mar. 20, 1992, as amended at 59 
FR 32124, June 22, 1994; 59 FR 36086, July 15, 1994; 60 FR 16584, Mar. 
31, 1995; 60 FR 58241, Nov. 27, 1995; 64 FR 39428, July 22, 1999; 65 FR 
18550, Apr. 7, 2000; 65 FR 24415, Apr. 26, 2000; 65 FR 35584, June 5, 
2000; 67 FR 76905, Dec. 13, 2002; 69 FR 28845, May 19, 2004]



Sec.  1003.103  Amount of penalty.

    (a) Except as provided in paragraphs (b) through (k) of this 
section, the OIG may impose a penalty of not more than--
    (1) $2,000 for each wrongful act occurring before January 1, 1997 
that is subject to a determination under Sec.  1003.102; and
    (2) $10,000 for each wrongful act occurring on or after January 1, 
1997 that is subject to a determination under Sec.  1003.102.
    (b) The OIG may impose a penalty of not more than $15,000 for each 
person with respect to whom a determination was made that false or 
misleading information was given under Sec.  1003.102(b)(4), or for each 
item and service that is subject to a determination under Sec.  
1003.102(a)(5) or Sec.  1003.102(b)(9) of this part. The OIG may impose 
a penalty of not more than $100,000 for each arrangement or scheme that 
is subject to a determination under Sec.  1003.102(b)(10) of this part.
    (c) The OIG may impose a penalty of not more than $11,000 \1\ for 
each payment for which there was a failure to report required 
information in accordance with Sec.  1003.102(b)(5), or for each 
improper disclosure, use or access to information that is subject to a 
determination under Sec.  1003.102(b)(6).
---------------------------------------------------------------------------

    \1\ As adjusted in accordance with the Federal Civil Monetary 
Penalty Inflation Adjustment Act of 1990 (Pub. L. 101-140), as amended 
by the Debt Collection Improvement Act of 1996 (Pub. L. 104-134).
---------------------------------------------------------------------------

    (d)(1) The OIG may impose a penalty of not more than $5,000 for each 
violation resulting from the misuse of Departmental, CMS, Medicare or 
Medicaid program words, letters, symbols or emblems as described in 
Sec.  1003.102(b)(7) relating to printed media, and a penalty of not 
more than

[[Page 729]]

$25,000 in the case of such misuse related to a broadcast or telecast, 
that is related to a determination under Sec.  1003.102(b)(7).
    (2) For purposes of this paragraph, a violation is defined as--
    (i) In the case of a direct mailing solicitation or advertisement, 
each separate piece of mail which contains one or more words, letters, 
symbols or emblems related to a determination under Sec.  
1003.102(b)(7);
    (ii) In the case of a printed solicitation or advertisement, each 
reproduction, reprinting or distribution of such item related to a 
determination under Sec.  1003.102(b)(7); and
    (iii) In the case of a broadcast or telecast, each airing of a 
single commercial or solicitation related to a determination under Sec.  
1003.102(b)(7).
    (e) For violations of section 1867 of the Act or Sec.  489.24 of 
this title, the OIG may impose--
    (1) Against each participating hospital with an emergency 
department, a penalty of not more than $50,000 for each negligent 
violation occurring on or after May 1, 1991, except that if the 
participating hospital has fewer than 100 State-licensed, Medicare-
certified beds on the date the penalty is imposed, the penalty will not 
exceed $25,000; and
    (2) Against each responsible physician, a penalty of not more than 
$50,000 for each negligent violation occurring on or after May 1, 1991.
    (f)(1) The OIG may, in addition to or in lieu of other remedies 
available under law, impose a penalty of up to $25,000 for each 
determination by CMS that a contracting organization has--
    (i) Failed substantially to provide an enrollee with required 
medically necessary items and services and the failure adversely affects 
(or has the likelihood of adversely affecting) the enrollee;
    (ii) Imposed premiums on enrollees in excess of amounts permitted 
under section 1876 or title XIX of the Act;
    (iii) Acted to expel or to refuse to re-enroll a Medicare 
beneficiary in violation of the provisions of section 1876 of the Act 
and for reasons other than the beneficiary's health status or 
requirements for health care services;
    (iv) Misrepresented or falsified information furnished to an 
individual or any other entity under section 1876 or section 1903(m) of 
the Act;
    (v) Failed to comply with the requirements of section 1876(g)(6)(A) 
of the Act, regarding prompt payment of claims; or
    (vi) Failed to comply with the requirements of Sec. Sec.  417.479 
(d) through (i) of this title for Medicare, and Sec. Sec.  417.479 (d) 
through (g) and (i) of this title for Medicaid, regarding certain 
prohibited incentive payments to physicians.
    (2) The OIG may, in addition to or in lieu of other remedies 
available under law, impose a penalty of up to $25,000 for each 
determination by CMS that a contracting organization with a contract 
under section 1876 of the Act--
    (i) Employs or contracts with individuals or entities excluded, 
under section 1128 or section 1128A of the Act, from participation in 
Medicare for the provision of health care, utilization review, medical 
social work, or administrative services; or
    (ii) Employs or contracts with any entity for the provision of 
services (directly or indirectly) through an excluded individual or 
entity.
    (3) The OIG may, in addition to or in lieu of other remedies 
available under law, impose a penalty of up to $100,000 for each 
determination that a contracting organization has--
    (i) Misrepresented or falsified information to the Secretary under 
section 1876 of the Act or to the State under section 1903(m) of the 
Act; or
    (ii) Acted to expel or to refuse to re-enroll a Medicaid recipient 
because of the individual's health status or requirements for health 
care services, or engaged in any practice that would reasonably be 
expected to have the effect of denying or discouraging enrollment 
(except as permitted by section 1876 or section 1903(m) of the Act) with 
the contracting organization by Medicare beneficiaries and Medicaid 
recipients whose medical condition or history indicates a need for 
substantial future medical services.
    (4) If enrolles are charged more than the allowable premium, the OIG 
will impose an additional penalty equal to double the amount of excess 
premium

[[Page 730]]

charged by the contracting organization. The excess premium amount will 
be deducted from the penalty and returned to the enrollee.
    (5) The OIG will impose an additional $15,000 penalty for each 
individual not enrolled when CMS determines that a contracting 
organization has committed a violation described in paragraph (f)(3)(ii) 
of this section.
    (6) For purposes of paragraph (f) of this section, a violation is 
each incident where a person has committed an act listed in Sec.  
417.500(a) or Sec.  434.67(a) of this title, or failed to comply with a 
requirement set forth in Sec.  434.80(c) of this title.
    (g) The OIG may impose a penalty of not more than $25,000 against a 
health plan for failing to report information on an adverse action 
required to be reported to the Healthcare Integrity and Protection Data 
Bank in accordance with section 1128E of the Act and Sec.  
1003.102(b)(5)(ii).
    (h) For each violation of Sec.  1003.102(b)(11), the OIG may 
impose--
    (1) A penalty of not more than $50,000, and
    (2) An assessment of up to three times the total amount of 
remuneration offered, paid, solicited or received, as specified in Sec.  
1003.104(b).
    (i) For violations of Sec.  1003.102(b)(14) of this part, the OIG 
may impose a penalty of not more than the greater of--
    (1) $5,000, or
    (2) Three times the amount of Medicare payments for home health 
services that are made with regard to the false certification of 
eligibility by a physician in accordance with sections 1814(a)(2)(C) or 
1835(a)(2)(A) of the Act.
    (j) The OIG may impose a penalty of not more than $10,000 per day 
for each day that the prohibited relationship described in Sec.  
1001.102(b)(12) of this part occurs.
    (k) For violations of section 1862(a)(14) of the Act and Sec.  
1003.102(b)(15), the OIG may impose a penalty of not more than $2,000 
for each bill or request for payment for items and services furnished to 
a hospital patient.
    (l) For violations of section 351A(b) or (c) of the Public Health 
Service Act and 42 CFR part 73, the OIG may impose a penalty of not more 
than $250,000 in the case of an individual, and not more than $500,000 
in the case of any other person.
    (m) For violations of section 1860D-31 of the Act and 42 CFR part 
403, subpart H, regarding the misleading or defrauding of program 
beneficiaries, or the misuse of transitional assistance funds, the OIG 
may impose a penalty of not more than $10,000 for each individual 
violation.

[57 FR 3346, Jan. 29, 1992, as amended at 59 FR 32125, June 22, 1994; 59 
FR 48566, Sept. 22, 1994; 60 FR 16584, Mar. 31, 1995; 60 FR 58241, Nov. 
27, 1995; 61 FR 13449, Mar. 27, 1996; 61 FR 52301, Oct. 7, 1996; 64 FR 
39429, July 22, 1999; 65 FR 18550, Apr. 7, 2000; 65 FR 24416, Apr. 26, 
2000; 65 FR 35584, June 5, 2000; 67 FR 76905, Dec. 13, 2002; 69 FR 
28845, May 19, 2004]



Sec.  1003.104  Amount of assessment.

    (a) The OIG may impose an assessment, where authorized, in 
accordance with Sec.  1003.102, of not more than--
    (1) Two times the amount for each item or service wrongfully claimed 
prior to January 1, 1997; and
    (2) Three times the amount for each item or service wrongfully 
claimed on or after January 1, 1997.
    (b) The assessment is in lieu of damages sustained by the Department 
or a State agency because of that claim.

[65 FR 24416, Apr. 26, 2000]



Sec.  1003.105  Exclusion from participation in Medicare, Medicaid and all Federal health care programs.

    (a)(1) Except as set forth in paragraph (b) of this section, the 
following persons may be subject, in lieu of or in addition to any 
penalty or assessment, to an exclusion from participation in Medicare 
for a period of time determined under Sec.  1003.107. There will be 
exclusions from Federal health care programs for the same period as the 
Medicare exclusion for any person who--
    (i) Is subject to a penalty or assessment under Sec.  1003.102(a), 
(b)(1), (b)(4), (b)(12), (b)(13) or (b)(15); or
    (ii) Commits a gross and flagrant, or repeated, violation of section 
1867 of the Act or Sec.  489.24 of this title on or after May 1, 1991. 
For purposes of this section, a gross and flagrant violation is one that 
presents an imminent danger to the health, safety or well-being of the 
individual who seeks emergency

[[Page 731]]

examination and treatment or places that individual unnecessarily in a 
high-risk situation.
    (b)(1)(i) With respect to any exclusion based on liability for a 
penalty or assessment under Sec.  1003.102 (a), (b)(1), or (b)(4), the 
OIG will consider an application from a State agency for a waiver if the 
person is the sole community physician or the sole source of essential 
specialized services in a community. With respect to any exclusion 
imposed under Sec.  1003.105(a)(1)(ii), the OIG will consider an 
application from a State agency for a waiver if the physician's 
exclusion from the State health care program would deny beneficiaries 
access to medical care or would otherwise cause hardship to 
beneficiaries.
    (ii) If a waiver is granted, it is applicable only to the State 
health care program for which the State requested the waiver.
    (iii) If the OIG subsequently obtains information that the basis for 
a waiver no longer exists, or the State agency submits evidence that the 
basis for the waiver no longer exists, the waiver will cease and the 
person will be excluded from the State health care program for the 
remainder of the period that the person is excluded from Medicare.
    (iv) The OIG notifies the State agency whether its request for a 
waiver has been granted or denied.
    (v) The decision to deny a waiver is not subject to administrative 
or judicial review.
    (2) For purposes of this section, the definitions contained in Sec.  
1001.2 of this chapter for ``sole community physician'' and ``sole 
source of essential specialized services in a community'' apply.
    (c) When the Inspector General proposes to exclude a nursing 
facility from the Medicare and Medicaid programs, he or she will, at the 
same time he or she notifies the respondent, notify the appropriate 
State licensing authority, the State Office of Aging, the long-term care 
ombudsman, and the State Medicaid agency of the Inspector General's 
intention to exclude the facility.

[59 FR 32125, June 22, 1994, as amended at 64 FR 39429, July 22, 1999; 
65 FR 24416, Apr. 26, 2000; 65 FR 35584, June 5, 2000]



Sec.  1003.106  Determinations regarding the amount of the penalty and assessment.

    (a) Amount of penalty. (1) In determining the amount of any penalty 
or assessment in accordance with Sec.  1003.102(a), (b)(1), (b)(4), and 
(b)(9) through (b)(16) of this part, the Department will take into 
account--
    (i) The nature of the claim, referral arrangement or other 
wrongdoing;
    (ii) The degree of culpability of the person against whom a civil 
money penalty is proposed;
    (iii) The history of prior offenses of the person against whom a 
civil money penalty is proposed;
    (iv) The financial condition of the person against whom a civil 
money penalty is proposed;
    (v) The completeness and timeliness of the refund with respect to 
Sec.  1003.102(b)(9);
    (vi) The amount of financial interest involved with respect to Sec.  
1003.102(b)(12);
    (vii) The amount of remuneration offered or transferred with respect 
to Sec.  1003.102(b)(13); and
    (viii) Such other matters as justice may require.
    (2) In determining the amount of any penalty in accordance with 
Sec. Sec.  1003.102 (b)(5) and (b)(6), the Department will take into 
account--
    (i) The nature and circumstances of the failure to properly report 
information, or the improper disclosure of information, as required;
    (ii) The degree of culpability of the person in failing to provide 
timely and complete data or in improperly disclosing, using or 
permitting access to information, as appropriate;
    (iii) The materiality, or significance of omission, of the 
information to be reported, or the materiality of the improper 
disclosure of, or use of, or access to information, as appropriate;
    (iv) Any prior history of the person with respect to violations of 
these provisions; and
    (v) Such other matters as justice may require.
    (3)(i) In determining the amount of any penalty in accordance with 
Sec.  1003.102(b)(7), the OIG will take into account--

[[Page 732]]

    (A) The nature and objective of the advertisement, solicitation or 
other communication, and the degree to which it has the capacity to 
deceive members of the public;
    (B) The degree of culpability of the individual, organization or 
entity in the use of the prohibited words, letters, symbols or emblems;
    (C) The frequency and scope of the violation, and whether a specific 
segment of the population was targeted;
    (D) The prior history of the individual, organization or entity in 
its willingness or refusal to comply with informal requests to correct 
violations;
    (E) The history of prior offenses of the individual, organization or 
entity in its misuse of Departmental and program words, letters, symbols 
and emblems;
    (F) The financial condition of the individual, organization or 
entity involved with the violation; and
    (G) Such other matters as justice may require.
    (ii) The use of a disclaimer of affiliation with the United States 
Government, the Department or its programs will not be considered as a 
mitigating factor in determining the amount of penalty in accordance 
with Sec.  1003.102(b)(7).
    (4) In determining the amount of any penalty in accordance with 
Sec.  1003.102(c), the OIG takes into account--
    (i) The degree of culpability of the respondent;
    (ii) The seriousness of the condition of the individual seeking 
emergency medical treatment;
    (iii) Any other instances where the respondent failed to provide 
appropriate emergency medical screening, stabilization and treatment of 
individuals coming to a hospital's emergency department or to effect an 
appropriate transfer;
    (iv) The respondent's financial condition;
    (v) The nature and circumstances of the violation; and
    (vi) Such other matters as justice may require.
    (5) In determining the appropriate amount of any penalty in 
accordance with Sec.  1003.103(f), the OIG will consider as 
appropriate--
    (i) The nature and scope of the required medically necessary item or 
service not provided and the circumstances under which it was not 
provided;
    (ii) The degree of culpability of the contracting organization;
    (iii) The seriousness of the adverse effect that resulted or could 
have resulted from the failure to provide required medically necessary 
care;
    (iv) The harm which resulted or could have resulted from the 
provision of care by a person that the contracting organization is 
expressly prohibited, under section 1876(i)(6) or section 1903(p)(2) of 
the Act, from contracting with or employing;
    (v) The harm which resulted or could have resulted from the 
contracting organization's expulsion or refusal to re-enroll a Medicare 
beneficiary or Medicaid recipient;
    (vi) The nature of the misrepresentation or fallacious information 
furnished by the contracting organization to the Secretary, State, 
enrollee or other entity under section 1876 or section 1903(m) of the 
Act;
    (vii) The extent to which the failure to provide medically necessary 
services could be attributed to a prohibited inducement to reduce or 
limit services under a physician incentive plan and the harm to the 
enrollee which resulted or could have resulted from such failure. It 
would be considered an aggravating factor if the contracting 
organization knowingly or routinely engaged in any prohibited practice 
which acted as an inducement to reduce or limit medically necessary 
services provided with respect to a specific enrollee in the 
organization;
    (viii) The history of prior offenses by the contracting organization 
or principals of the contracting organization, including whether, at any 
time prior to determination of the current violation or violations, the 
contracting organization or any of its principals were convicted of a 
criminal charge or were held liable for civil or administrative 
sanctions in connection with a program covered by this part or any other 
public or private program of payment for medical services; and
    (ix) Such other matters as justice may require.

[[Page 733]]

    (b) Determining the amount of the penalty or assessment. As 
guidelines for taking into account the factors listed in paragraph 
(a)(1) of this section, the following circumstances are to be 
considered--
    (1) Nature and circumstances of the incident. It should be 
considered a mitigating circumstance if all the items or services or 
incidents subject to a determination under Sec.  1003.102 included in 
the action brought under this part were of the same type and occurred 
within a short period of time, there were few such items or services or 
incidents, and the total amount claimed or requested for such items or 
services was less than $1,000. It should be considered an aggravating 
circumstance if--
    (i) Such items or services or incidents were of several types, 
occurred over a lengthy period of time;
    (ii) There were many such items or services or incidents (or the 
nature and circumstances indicate a pattern of claims or requests for 
payment for such items or services or a pattern of incidents);
    (iii) The amount claimed or requested for such items or services was 
substantial; or
    (iv) The false or misleading information given resulted in harm to 
the patient, a premature discharge or a need for additional services or 
subsequent hospital admission.
    (2) Degree of culpability. It should be considered a mitigating 
circumstance if corrective steps were taken promptly after the error was 
discovered. It should be considered an aggravating circumstance if--
    (i) The respondent knew the item or service was not provided as 
claimed or if the respondent knew that the claim was false or 
fraudulent;
    (ii) The respondent knew that the items or services were furnished 
during a period that he or she had been excluded from participation and 
that no payment could be made as specified in Sec. Sec.  1003.102(a)(3) 
and 1003.102(b)(12), or because payment would violate the terms of an 
assignment or an agreement with a State agency or other agreement or 
limitation on payment under Sec.  1003.102(b);
    (iii) The respondent knew that the information could reasonably be 
expected to influence the decision of when to discharge a patient from a 
hospital; or
    (iv) The respondent knew that the offer or transfer of remuneration 
described in Sec.  1003.102(b)(13) of this part would influence a 
beneficiary to order or receive from a particular provider, practitioner 
or supplier items or services reimbursable under Medicare or a State 
health care program.
    (3) Prior offenses. It should be considered an aggravating 
circumstance if at any time prior to the incident or presentation of any 
claim or request for payment which included an item or service subject 
to a determination under Sec.  1003.102, the respondent was held liable 
for criminal, civil or administrative sanctions in connection with a 
program covered by this part or any other public or private program of 
reimbursement for medical services.
    (4) Other wrongful conduct. It should be considered an aggravating 
circumstance if there is proof that a respondent engaged in wrongful 
conduct, other than the specific conduct upon which liability is based, 
relating to government programs or in connection with the delivery of a 
health care item or service. The statute of limitations governing civil 
money penalty proceedings will not apply to proof of other wrongful 
conduct as an aggravating circumstance.
    (5) Financial condition. In all cases, the resources available to 
the respondent will be considered when determining the amount of the 
penalty and assessment.
    (6) Other matters as justice may require. Other circumstances of an 
aggravating or mitigating nature should be taken into account if, in the 
interests of justice, they require either a reduction of the penalty or 
assessment or an increase in order to assure the achievement of the 
purposes of this part.
    (c) In determining the amount of the penalty and assessment to be 
imposed for every item or service or incident subject to a determination 
under Sec. Sec.  1003.102(a), (b)(1) and (b)(4)--

[[Page 734]]

    (1) If there are substantial or several mitigating circumstances, 
the aggregate amount of the penalty and assessment should be set at an 
amount sufficiently below the maximium permitted by Sec. Sec.  
1003.103(a) and 1003.104, to reflect that fact.
    (2) If there are substantial or several aggravating circumstances, 
the aggregate amount of the penalty and assessment should be set at an 
amount sufficiently close or at the maximum permitted by Sec. Sec.  
1003.103(a) and 1003.104, to reflect that fact.
    (3) Unless there are extraordinary mitigating circumstances, the 
aggregate amount of the penalty and assessment should never be less than 
double the approximate amount of damages and costs (as defined in 
paragraph (f) of this section) sustained by the United States, or any 
State, as a result of claims or incidents subject to a determination 
under Sec. Sec.  1003.102(a), (b)(1) and (b)(4).
    (d) In considering the factors listed in paragraph (a)(4) of this 
section for violations subject to a determination under Sec.  
1003.103(e), the following circumstances are to be considered, as 
appropriate, in determining the amount of any penalty--
    (1) Degree of culpability. It would be a mitigating circumstance if 
the respondent hospital had appropriate policies and procedures in 
place, and had effectively trained all of its personnel in the 
requirements of section 1867 of the Act and Sec.  489.24 of this title, 
but an employee or responsible physician acted contrary to the 
respondent hospital's policies and procedures.
    (2) Seriousness of individual's condition. It would be an 
aggravating circumstance if the respondent's violation(s) occurred with 
regard to an individual who presented to the hospital a request for 
treatment of a medical condition that was clearly an emergency, as 
defined by Sec.  489.24(b) of this title.
    (3) Prior offenses. It would be an aggravating circumstance if there 
is evidence that at any time prior to the current violation(s) the 
respondent was found to have violated any provision of section 1867 of 
the Act or Sec.  489.24 of this title.
    (4) Financial condition. In all cases, the resources available to 
the respondent would be considered when determining the amount of the 
penalty. A respondent's audited financial statements, tax returns or 
financial disclosure statements, as appropriate, will be reviewed by OIG 
in making a determination with respect to the respondent's financial 
condition.
    (5) Nature and circumstances of the incident. It would be considered 
a mitigating circumstance if an individual presented a request for 
treatment, but subsequently exhibited conduct that demonstrated a clear 
intent to leave the respondent hospital voluntarily. In reviewing such 
circumstances, the OIG would evaluate the respondent's efforts to--
    (i) Provide the services required by section 1867 of the Act and 
Sec.  489.24 of this title, despite the individual's withdrawal of the 
request for examination or treatment; and
    (ii) Document any attempts to inform the individual (or his or her 
representative) of the risks of leaving the respondent hospital without 
receiving an appropriate medical screening examination or treatment, and 
obtain written acknowledgment from the individual (or his or her 
representative) prior to the individual's departure from the respondent 
hospital that he or she is leaving contrary to medical advice.
    (6) Other matters as justice may require. (i) It would be considered 
a mitigating circumstance if the respondent hospital--
    (A) Developed and implemented a corrective action plan;
    (B) Took immediate appropriate action against any hospital personnel 
or responsible physician who violated section 1867 of the Act or Sec.  
489.24 of this title prior to any investigation of the respondent 
hospital by CMS; or
    (C) Is a rural or publicly-owned facility that is faced with severe 
physician staffing and financial deficiencies.
    (ii) It would be considered an aggravating circumstance if an 
individual was severely harmed or died as a result, directly or 
indirectly, of the respondent's violation of section 1867 of the Act or 
Sec.  489.24 of this title.
    (iii) Other circumstances of an aggravating or mitigating nature 
will be taken into account if, in the interests

[[Page 735]]

of justice, they require either a reduction of the penalty or an 
increase in order to assure the achievement of the purposes of this 
part.
    (e) In considering the factors listed in paragraph (a)(5) of this 
section for violations subject to a determination under Sec.  
1003.103(f), the following circumstances are to be considered, as 
appropriate, in determining the amount of any penalty--
    (f)(1) The standards set forth in this section are binding, except 
to the extent that their application would result in imposition of an 
amount that would exceed limits imposed by the United States 
Constitution.
    (2) The amount imposed will not be less than the approximate amount 
required to fully compensate the United States, or any State, for its 
damages and costs, tangible and intangible, including but not limited to 
the costs attributable to the investigation, prosecution and 
administrative review of the case.
    (3) Nothing in this section will limit the authority of the 
Department to settle any issue or case as provided by Sec.  1003.126, or 
to compromise any penalty and assessment as provided by Sec.  1003.128.

[57 FR 3347, Jan. 29, 1992, as amended at 59 FR 32125, June 22, 1994; 59 
FR 36086, July 15, 1994; 59 FR 48567, Sept. 22, 1994; 60 FR 16584, Mar. 
31, 1995; 60 FR 58241, Nov. 27, 1995; 61 FR 13449, Mar. 27, 1996; 64 FR 
39429, July 22, 1999; 65 FR 24416, Apr. 26, 2000; 67 FR 11935, Mar. 18, 
2002; 70 FR 13325, Mar. 18, 2005]



Sec.  1003.107  Determinations regarding exclusion.

    (a) In determining whether to exclude a person under this part and 
the duration of any exclusion, the Department considers the 
circumstances described in Sec.  1003.106(a).
    (b) With respect to determinations to exclude a person under 
Sec. Sec.  1003.102(a), (b)(1), (b)(4), (b)(12) or (b)(13) of this part, 
the Department considers those circumstances described in Sec.  
1003.106(b). Where there are aggravating circumstances with respect to 
such determinations, the person should be excluded.
    (c) The guidelines set forth in this section are not binding. 
Nothing in this section limits the authority of the Department to settle 
any issue or case as provided by Sec.  1003.126 of this part.

[59 FR 32126, June 22, 1994, as amended at 65 FR 24418, Apr. 26, 2000]



Sec.  1003.108  Penalty, assessment, and exclusion not exclusive.

    Penalties, assessments, and exclusions imposed under this part are 
in addition to any other penalties prescribed by law.

[59 FR 32126, June 22, 1994]



Sec.  1003.109  Notice of proposed determination.

    (a) If the Inspector General proposes a penalty and, when 
applicable, assessment, or proposes to exclude a respondent from 
participation in a Federal health care program, as applicable, in 
accordance with this part, he or she must deliver or send by certified 
mail, return receipt requested, to the respondent written notice of his 
or her intent to impose a penalty, assessment and exclusion, as 
applicable. The notice includes--
    (1) Reference to the statutory basis for the penalty, assessment and 
exclusion;
    (2) A description of the claims, requests for payment, or incidents 
with respect to which the penalty, assessment and exclusion are proposed 
(except in cases where the Inspector General is relying upon statistical 
sampling in accordance with Sec.  1003.133 in which case the notice 
shall describe those claims and requests for payment comprising the 
sample upon which the Inspector General is relying and will also briefly 
describe the statistical sampling technique utilized by the Inspector 
General);
    (3) The reason why such claims, requests for payments or incidents 
subject the respondent to a penalty, assessment and exclusion;
    (4) The amount of the proposed penalty, assessment and the period of 
proposed exclusion (where applicable);
    (5) Any circumstances described in Sec.  1003.106 that were 
considered when determining the amount of the proposed penalty and 
assessment and the period of exclusion;
    (6) Instructions for responding to the notice, including--

[[Page 736]]

    (i) A specific statement of respondent's right to a hearing, and
    (ii) A statement that failure to request a hearing within 60 days 
permits the imposition of the proposed penalty, assessment and exclusion 
without right of appeal; and
    (7) In the case of a notice sent to a respondent who has an 
agreement under section 1866 of the Act, the notice also indicates that 
the imposition of an exclusion may result in the termination of the 
provider's agreement in accordance with section 1866(b)(2)(C) of the 
Act.
    (b) Any person upon whom the Inspector General has proposed the 
imposition of a penalty, assessment or exclusion may appeal such 
proposed penalty, assessment or exclusion to the DAB in accordance with 
Sec.  1005.2 of this chapter. The provisions of part 1005 of this 
chapter govern such appeals.
    (c) If the respondent fails, within the time permitted, to exercise 
his or her right to a hearing under this section, any exclusion, 
penalty, or assessment becomes final.

[57 FR 3348, Jan. 29, 1992, as amended at 59 FR 32126, June 22, 1994; 64 
FR 39429, July 22, 1999; 65 FR 24418, Apr. 26, 2000]



Sec.  1003.110  Failure to request a hearing.

    If the respondent does not request a hearing within the time 
prescribed by Sec.  1003.109(a), the Inspector General may impose the 
proposed penalty, assessment, and exclusion, or any less severe penalty, 
assessment, and suspension. The Inspector General shall notify the 
respondent by certified mail, return receipt requested, of any penalty, 
assessment, and exclusion that has been imposed and of the means by 
which the respondent may satisfy the judgment. The respondent has no 
right to appeal a penalty, assessment, and exclusion, with respect to 
which he or she has not requested a hearing.

[51 FR 34777, Sept. 30, 1986, as amended at 57 FR 3348, Jan. 29, 1992]



Sec.  1003.114  Collateral estoppel.

    (a) Where a final determination pertaining to the respondent's 
liability under Sec.  1003.102 has been rendered in any proceeding in 
which the respondent was a party and had an opportunity to be heard, the 
respondent shall be bound by such determination in any proceeding under 
this part.
    (b) In a proceeding under this part that--
    (1) Is against a person who has been convicted (whether upon a 
verdict after trial or upon a plea of guilty or nolo contendere) of a 
Federal crime charging fraud or false statements, and
    (2) Involves the same transactions as in the criminal action, the 
person is estopped from denying the essential elements of the criminal 
offense.

[57 FR 3348, Jan. 29, 1992, as amended at 64 FR 39429, July 22, 1999]



Sec.  1003.126  Settlement.

    The Inspector General has exclusive authority to settle any issues 
or case, without consent of the ALJ.

[65 FR 24418, Apr. 26, 2000]



Sec.  1003.127  Judicial review.

    Section 1128A(e) of the Act authorizes judicial review of a penalty, 
assessment or exclusion that has become final. Judicial review may be 
sought by a respondent only with respect to a penalty, assessment or 
exclusion with respect to which the respondent filed an exception under 
Sec.  1005.21(c) of this chapter unless the failure or neglect to urge 
such exception will be excused by the court in accordance with section 
1128A(e) of the Act because of extraordinary circumstances.

[57 FR 3348, Jan. 29, 1992]



Sec.  1003.128  Collection of penalty and assessment.

    (a) Once a determination by the Secretary has become final, 
collection of any penalty and assessment will be the responsibility of 
CMS, except in the case of the Maternal and Child Health Services Block 
Grant program, where the collection will be the responsibility of the 
PHS, and in the case of the Social Services Block Grant program, where 
the collection will be the responsibility of the Office of Human 
Development Services.
    (b) A penalty or assessment imposed under this part may be 
compromised by the Inspector General, and may be recovered in a civil 
action brought in the United States district court for the

[[Page 737]]

district where the claim was presented, or where the respondent resides.
    (c) The amount of a penalty and assessment when finally determined, 
or the amount agreed upon in compromise, may be deducted from any sum 
then or later owing by the United States, or by a State agency, to the 
respondent.
    (d) Matters that were raised or that could have been raised in a 
hearing before an ALJ or in an appeal under section 1128A(e) of the Act 
may not be raised as a defense in a civil action by the United States to 
collect a penalty under this part.

[51 FR 34777, Sept. 30, 1986, as amended at 57 FR 3349, Jan. 29, 1992; 
65 FR 24418, Apr. 26, 2000]



Sec.  1003.129  Notice to other agencies.

    Whenever a penalty, assessment or exclusion become final, the 
following organizations and entities will be notified about such action 
and the reasons for it--the appropriate State or local medical or 
professional association; the appropriate Quality Improvement 
Organization; as appropriate, the State agency responsible or the 
administration of each State health care program; the appropriate 
Medicare carrier or intermediary; the appropriate State or local 
licensing agency or organization (including the Medicare and Medicaid 
State survey agencies); and the long-term care ombudsman. In cases 
involving exclusions, notice will also be given to the public of the 
exclusion and its effective date.

[57 FR 3349, Jan. 29, 1992]



Sec.  1003.132  Limitations.

    No action under this part will be entertained unless commenced, in 
accordance with Sec.  1003.109(a) of this part, within 6 years from the 
date on which the claim was presented, the request for payment was made, 
or the incident occurred.

[57 FR 3349, Jan. 29, 1992]



Sec.  1003.133  Statistical sampling.

    (a) In meeting the burden of proof set forth in Sec.  1005.15, the 
Inspector General may introduce the results of a statistical sampling 
study as evidence of the number and amount of claims and/or requests for 
payment as described in Sec.  1003.102 that were presented or caused to 
be presented by respondent. Such a statistical sampling study, if based 
upon an appropriate sampling and computed by valid statistical methods, 
shall constitute prima facie evidence of the number and amount of claims 
or requests for payment as described in Sec.  1003.102.
    (b) Once the Inspector General has made a prima facie case as 
described in paragraph (a) of this section, the burden of production 
shall shift to respondent to produce evidence reasonably calculated to 
rebut the findings of the statistical sampling study. The Inspector 
General will then be given the opportunity to rebut this evidence.

[51 FR 34777, Sept. 30, 1986, as amended at 57 FR 3349, Jan. 29, 1992]



Sec.  1003.134  Effect of exclusion.

    The effect of an exclusion will be as set forth in Sec.  1001.1901 
of this chapter.

[57 FR 3349, Jan. 29, 1992]



Sec.  1003.135  Reinstatement.

    A person who has been excluded in accordance with this part may 
apply for reinstatement at the end of the period of exclusion. The OIG 
will consider any request for reinstatement in accordance with the 
provisions of Sec. Sec.  1001.3001 through 1001.3004 of this chapter.

[57 FR 3349, Jan. 29, 1992]



PART 1004_IMPOSITION OF SANCTIONS ON HEALTH CARE PRACTITIONERS AND PROVIDERS OF HEALTH CARE SERVICES BY A QUALITY IMPROVEMENT ORGANIZATION--Table of Contents




                      Subpart A_General Provisions

Sec.
1004.1 Scope and definitions.

      Subpart B_Sanctions Under the QIO Program; General Provisions

1004.10 Statutory obligations of practitioners and other persons.
1004.20 Sanctions.

[[Page 738]]

                     Subpart C_QIO Responsibilities

1004.30 Basic responsibilities.
1004.40 Action on identification of a violation.
1004.50 Meeting with a practitioner or other person.
1004.60 QIO finding of a violation.
1004.70 QIO action on final finding of a violation.
1004.80 QIO report to the OIG.
1004.90 Basis for recommended sanction.

                     Subpart D_OIG Responsibilities

1004.100 Acknowledgement and review of report.
1004.110 Notice of sanction.

               Subpart E_Effect and Duration of Exclusion

1004.120 Effect of an exclusion on program payments and services.
1004.130 Reinstatement after exclusion.

                            Subpart F_Appeals

1004.140 Appeal rights.

    Authority: 42 U.S.C. 1302 and 1320c-5.

    Source: 60 FR 63640, Dec. 12, 1995, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  1004.1  Scope and definitions.

    (a) Scope. This part implements section 1156 of the Act by--
    (1) Setting forth certain obligations imposed on practitioners and 
providers of services under Medicare;
    (2) Establishing criteria and procedures for the reports required 
from quality improvement organizations (QIOs) when there is failure to 
meet those obligations;
    (3) Specifying the policies and procedures for making determinations 
on violations and imposing sanctions; and
    (4) Defining the procedures for appeals by the affected party and 
the procedures for reinstatements.
    (b) Definitions. As used in this part, unless the context indicates 
otherwise--
    Dentist is limited to licensed doctors of dental surgery or dental 
medicine.
    Economically means the services are provided at the least expensive, 
medically appropriate type of setting or level of care available.
    Exclusion means that items and services furnished or ordered (or at 
the medical direction or on the prescription of a physician) by a 
specified health care practitioner, provider or other person during a 
specified period are not reimbursed under titles V, XVIII, XIX, or XX of 
the Social Security Act and all other Federal non-procurement programs.
    Gross and flagrant violation means a violation of an obligation has 
occurred in one or more instances which presents an imminent danger to 
the health, safety, or well-being of a program patient or places the 
program patient unnecessarily in high-risk situations.
    Health care service or services means services or items for which 
payment may be made (in whole or in part) under the Medicare or State 
health care programs.
    Health professional shortage area (HPSA) means an area designated by 
the Secretary and defined in 42 CFR 5.2.
    Metropolitan Statistical Area means an area as defined by the 
Executive Office of Management and Budget.
    Obligation means any of the obligations specified at section 1156(a) 
of the Act.
    Other person means a hospital or other health care facility, an 
organization or an agency that provides health care services or which 
payment may be made (in whole or in part) under the Medicare or State 
health care programs.
    Pattern or care means that the care under question has been 
demonstrated in more than three instances, each of which involved 
different admissions.
    Pharmacy professional is a term limited to individuals who are 
licensed or registered to provide pharmaceutical services.
    Podiatric professional is a term limited to licensed doctors of 
podiatric medicine.
    Practice area means the location where over 50 percent of the 
practitioner's or other person's patients are seen.
    Practitioner means a physician or other health care professional 
licensed under State law to practice his or her profession.
    Primary medical care professional is a term limited to:

[[Page 739]]

    (i) Licensed doctors of medicine and doctors of osteopathy providing 
direct patient care who practice in the fields of general or family 
practice, general internal medicine, pediatrics, obstetrics and 
gynecology, surgery, and any other specialty that is not accommodated by 
the remaining specialty HPSA designator, or
    (ii) Those facilities where care and treatment is provided to 
patients with health problems other than mental disorders.
    Pro area means the geographic area subject to review by a particular 
QIO.
    Provider means a hospital or other health care facility, agency, or 
organization.
    Psychiatric professional is a term limited to licensed doctors of 
medicine who limit their practice to psychiatry or to those facilities 
where care and treatment is limited to patients with mental disorders.
    Rural means any area outside an urban area.
    Rural health professional shortage area means any health 
professional shortage area located outside a Metropolitan Statistical 
Area.
    Sanction means an exclusion or monetary penalty that the Secretary 
may impose on a practitioner or other person as a result of a 
recommendation from a QIO.
    Serious risk includes situations that may involve the risk of 
unnecessary treatment, prolonged treatment, lack of treatment, incorrect 
treatment, medical complication, premature discharge, physiological or 
anatomical impairment, disability, or death.
    State health care program means a State plan approved under title 
XIX, any program receiving funds under title V or from an allotment to a 
State under such title, or any program receiving funds under title XX or 
from an allotment to a State under such title.
    Substantial violation in a substantial number of cases means a 
pattern of providing care, as defined in this section, that is 
inappropriate, unnecessary, or does not meet recognized professional 
standards of care, or is not supported by the necessary documentation of 
care as required by the QIO.
    Urban means a Metropolitan Statistical Area as defined by the 
Executive Office of Management and Budget.
    Vision care professional is a term limited to licensed doctors of 
medicine who limit their practice to ophthalmology and to doctors of 
optometry.



      Subpart B_Sanctions Under the QIO Program; General Provisions



Sec.  1004.10  Statutory obligations of practitioners and other persons.

    It is the obligation of any health care practitioner or other person 
who furnishes or orders health care services that may be reimbursed 
under the Medicare or State health care programs to ensure, to the 
extent of his or her or its authority, that those services are--
    (a) Provided economically and only when, and to the extent, 
medically necessary;
    (b) Of a quality that meets professionally recognized standards of 
health care; and
    (c) Supported by evidence of medical necessity and quality in the 
form and fashion and at such time that the reviewing QIO may reasonably 
require (including copies of the necessary documentation and evidence of 
compliance with pre-admission or pre-procedure review requirements) to 
ensure that the practitioner or other person is meeting the obligations 
imposed by section 1156(a) of the Act.



Sec.  1004.20  Sanctions.

    In addition to any other sanction provided under the law, a 
practitioner or other person may be--
    (a) Excluded from participating in programs under titles V, XVIII, 
XIX, and XX of the Social Security Act for a period of no less than 1 
year; or
    (b) In lieu of exclusion and as a condition for continued 
participation in titles V, XVIII, XIX, and XX of the Act, if the 
violation involved the provision or ordering of health care services (or 
services furnished at the medical direction or on the prescription of a 
physician) that were medically improper or unnecessary, required to pay 
an amount of up to $10,000 for each instance in which improper or 
unnecessary services were furnished or ordered

[[Page 740]]

(or prescribed, if appropriate). The practitioner or other person will 
be required either to pay the monetary assessment within 6 months of the 
date of notice or have it deducted from any sums the Federal Government 
owes the practitioner or other person.

[62 FR 23143, Apr. 29, 1997]



                     Subpart C_QIO Responsibilities



Sec.  1004.30  Basic responsibilities.

    (a) The QIO must use its authority or influence to enlist the 
support of other professional or government agencies to ensure that each 
practitioner or other person complies with the obligations specified in 
Sec.  1004.10.
    (b) When the QIO identifies situations where an obligation specified 
in Sec.  1004.10 is violated, it will afford the practitioner or other 
person reasonable notice and opportunity for discussion and, if 
appropriate, a suggested method for correcting the situation and a time 
period for a corrective action in accordance with Sec. Sec.  1004.40 and 
1004.60.
    (c) The QIO must submit a report to the OIG after the notice and 
opportunity provided under paragraph (b) of this section and, if 
appropriate, the opportunity to enter into and complete a corrective 
action plan (CAP) if the QIO finds that the practitioner or other person 
has--
    (1) Failed substantially to comply with any obligation in a 
substantial number of admissions; or
    (2) Grossly and flagrantly violated any obligation in one or more 
instances.
    (d) The QIO report to the OIG must comply with the provisions of 
Sec.  1004.80.
    (e) If a practitioner or other person relocates to another QIO area 
prior to a finding of a violation or sanction recommendation, and the 
originating QIO--
    (1) Is able to make a finding, the originating QIO must, as 
appropriate, close the case or forward a sanction recommendation to the 
OIG; or
    (2) Cannot make a finding, the originating QIO must forward all 
documentation regarding the case to the QIO with jurisdiction, and 
notify the practitioner or other person of this action.
    (f) The QIO must deny payment for services or items furnished or 
ordered (or at the medical direction or on the prescription of an 
excluded physician) by an excluded practitioner or other person when the 
QIO identifies the services or items. It must report the findings to the 
Centers for Medicare & Medicaid Services.



Sec.  1004.40  Action on identification of a violation.

    When a QIO identifies a violation, it must--
    (a) Indicate whether the violation is a gross and flagrant violation 
or is a substantial violation in a substantial number of cases; and
    (b) Send the practitioner or other person written notice of the 
identification of a violation containing the following information--
    (1) The obligation(s) involved;
    (2) The situation, circumstances or activity that resulted in a 
violation;
    (3) The authority and responsibility of the QIO to report violations 
of any obligation under section 1156(a) of the Act;
    (4) A suggested method for correcting the situation and a time 
period for corrective action, if appropriate;
    (5) The sanction that the QIO could recomment to the OIG;
    (6) The right of the practitioner or other person to submit to the 
QIO within 30 days of receipt of the notice additional information or a 
written request for a meeting with the QIO to review and discuss the 
finding, or both. The date of receipt is presumed to be 5 days after the 
date on the notice, unless there is a reasonable showing to the 
contrary. The notice will also state that if a meeting is requested--
    (i) It will be held within 30 days of receipt by the QIO of the 
request, but may be extended for good cause;
    (ii) The practitioner or other person may have an attorney present; 
and
    (iii) The attorney, if present, will be permitted to make opening 
and closing remarks, ask clarifying questions at the meeting and assist 
the practitioner or other person in presenting the testimony of expert 
witnesses who may appear on the practitioner's or other person's behalf; 
and

[[Page 741]]

    (7) A copy of the material used by the QIO in arriving at its 
finding except for QIO deliberations, as set forth in Sec.  476.139 of 
this part.



Sec.  1004.50  Meeting with a practitioner or other person.

    If the practitioner or other person requests a meeting with the 
QIO--
    (a) The QIO panel that meets with the practitioner or other person 
must consist of a minimum of 3 physicians;
    (b) No physician member of the QIO panel may be in direct economic 
competition with the practitioner or other person being considered for 
sanction;
    (c) The QIO must ensure that no physician member of the QIO panel 
has a substantial bias for or against the practitioner or other person 
being considered for sanction;
    (d) At least one member of the QIO panel meeting with the 
practitioner or other person should practice in a similar area, e.g., 
urban or rural, and at least one member of the panel must be in the same 
specialty (both requirements could be met by a single individual);
    (e) If the practitioner or other person has an attorney present, 
that attorney will be permitted to make opening and closing remarks, ask 
clarifying questions and assist the practitioner or other person in 
presenting the testimony of expert witnesses who may appear on the 
practitioner's or other person behalf;
    (f) The physician who recommends to the QIO that a practitioner or 
other person be sanctioned may not vote on that recommendation at the 
meeting;
    (g) The QIO may allow the practitioner or other person 5 working 
days after the meeting to provide the QIO additional relevant 
information that may affect its finding; and
    (h) A verbatim record must be made of the meeting and must be made 
available to the practitioner or other person promptly.



Sec.  1004.60  QIO finding of a violation.

    (a) On the basis of any additional information received, the QIO 
will affirm or modify its finding. If the QIO affirms its finding, it 
may suggest in writing a method for correcting the situation and a time 
period for corrective action. This CAP could correspond with, or be a 
continuation of, a prior CAP or be a new proposal based on additional 
information received by the QIO. If the finding has been resolved to the 
QIO's satisfaction, the QIO may modify its initial finding or 
recommendation or close the case.
    (b) The QIO must give written notice to the practitioner or other 
person of any action it takes as a result of the additional information 
received, as specified in Sec.  1004.70.
    (c) At least one member of the QIO participating in the process 
which resulted in a recommendation to the OIG that a practitioner or 
other person be sanctioned should practice in a similar geographic area, 
e.g. urban or rural, and at least one member of the panel must be in the 
same medical specialty. Both requirements can be met by a single 
individual. In addition, no one at the QIO who is a participant in such 
a finding may be in direct economic competition with, or have a 
substantial bias for or against, that practitioner or other person being 
recommended for sanction.



Sec.  1004.70  QIO action on final finding of a violation.

    If the finding is not resolved to the QIO's satisfaction as 
specified in Sec.  1004.60(a), the QIO must--
    (a) Submit its report and recommendation to the OIG;
    (b) Send the affected practitioner or other person a concurrent 
final notice, with a copy of all the material that is being forwarded to 
the OIG, advising that--
    (1) The QIO recommendation has been submitted to the OIG;
    (2) The practitioner or other person has 30 days from receipt of 
this final notice to submit any additional written material or 
documentary evidence to the OIG at its headquarters location. The date 
of receipt is presumed to be 5 days after the date on the notice, unless 
there is a reasonable showing to the contrary; and
    (3) Due to the 120-day statutory requirement specified in Sec.  
1004.100(e), the period for submitting additional information will not 
be extended and any material received by the OIG after the

[[Page 742]]

30-day period will not be considered; and
    (c) Provide notice to the State medical board or to other 
appropriate licensing boards for other practitioner types when it 
submits a report and recommendations to the OIG with respect to a 
physician or other person whom the board is responsible for licensing.



Sec.  1004.80  QIO report to the OIG.

    (a) Manner of reporting. If the violation(s) identified by the QIO 
have not been resolved, it must submit a report and recommendation to 
the OIG at the field office with jurisdiction.
    (b) Content of report. The QIO report must include the following 
information--
    (1) Identification of the practitioner or other person and, when 
applicable, the name of the director, administrator or owner of the 
entity involved;
    (2) The type of health care services involved;
    (3) A description of each failure to comply with an obligation, 
including specific dates, places, circumstances and other relevant 
facts;
    (4) Pertinent documentary evidence;
    (5) Copies of written correspondence, including reports of 
conversations with the practitioner or other person regarding the 
violation and, if applicable, a copy of the verbatim transcript of the 
meeting with the practitioner or other person;
    (6) The QIO's finding that an obligation under section 1156(a) of 
the Act has been violated and that the violation is substantial and has 
occurred in a substantial number of cases or is gross and flagrant;
    (7) A case-by-case analysis and evaluation of any additional 
information provided by the practitioner or other person in response to 
the QIO's initial finding;
    (8) A copy of the CAP that was developed and documentation of the 
results of such plan;
    (9) The number of admissions by the practitioner or other person 
reviewed by the QIO during the period in which the violation(s) were 
identified;
    (10) The professional qualifications of the QIO's reviewers; and
    (11) The QIO's sanction recommendation.
    (c) QIO recommendation. The QIO must specify in its report--
    (1) The sanction recommended;
    (2) The amount of the monetary penalty recommended, if applicable;
    (3) The period of exclusion recommended, if applicable;
    (4) The availability of alternative sources of services in the 
community, with supporting information; and
    (5) The county or counties in which the practitioner or other person 
furnishes services.

[60 FR 63640, Dec. 12, 1995, as amended at 62 FR 23143, Apr. 29, 1997]



Sec.  1004.90  Basis for recommended sanction.

    The QIO's specific recommendation must be based on documentation 
provided to the OIG showing its consideration of--
    (a) The type of offense involved;
    (b) The severity of the offense;
    (c) The deterrent value;
    (d) The practitioner's or other person's previous sanction record;
    (e) The availability of alternative sources of services in the 
community; and
    (f) Any other factors that the QIO considers relevant, such as the 
duration of the problem.



                     Subpart D_OIG Responsibilities



Sec.  1004.100  Acknowledgement and review of report.

    (a) Acknowledgement. The OIG will inform the QIO of the date it 
received the QIO's report and recommendation.
    (b) Review. The OIG will review the QIO report and recommendation to 
determine whether--
    (1) The QIO has followed the regulatory requirements of this part; 
and
    (2) A violation has occurred.
    (c) Rejection of the QIO recommendation. If the OIG decides that a 
sanction is not warranted, it will notify the QIO that recommended the 
sanction, the affected practitioner or other person, and the licensing 
board informed by the QIO of the sanction recommendation that the 
recommendation is rejected.
    (d) Decision to sanction. If the OIG decides that a violation of 
obligations has occurred, it will determine the appropriate sanction by 
considering--

[[Page 743]]

    (1) The recommendation of the QIO;
    (2) The type of offense;
    (3) The severity of the offense;
    (4) The previous sanction record of the practitioner or other 
person;
    (5) The availability of alternative sources of services in the 
community;
    (6) Any prior problems the Medicare or State health care programs 
have had with the practitioner or other person; and
    (7) Any other matters relevant to the particular case.
    (e) Exclusion sanction. If the QIO submits a recommendation for 
exclusion to the OIG, and a determination is not made by the 120th day 
after actual receipt by the OIG, the exclusion sanction recommended will 
become effective and the OIG will provide notice in accordance with 
Sec.  1004.110(f).
    (f) Monetary penalty. If the QIO recommendation is to assess a 
monetary penalty, the 120-day provision does not apply and the OIG will 
provide notice in accordance with Sec.  1004.110 (a)-(e).

[60 FR 63640, Dec. 12, 1995, as amended at 62 FR 23143, Apr. 29, 1997]



Sec.  1004.110  Notice of sanction.

    (a) The OIG must notify the practitioner or other person of the 
adverse determination and of the sanction to be imposed.
    (b) The sanction is effective 20 days from the date of the notice. 
Receipt is presumed to be 5 days after the date on the notice, unless 
there is a reasonable showing to the contrary.
    (c) The notice must specify--
    (1) The legal and factual basis for the determination;
    (2) The sanction to be imposed;
    (3) The effective date and, if appropriate, the duration of the 
exclusion;
    (4) The appeal rights of the practitioner or other person;
    (5) The opportunity and the process necessary to provide alternative 
notification as set forth in paragraphs (d) and (e) of this section; and
    (6) In the case of exclusion, the earliest date on which the OIG 
will accept a request for reinstatement.
    (d) Patient notification. (1)(i) The OIG will provide a sanctioned 
practitioner or other person an opportunity to elect to inform each of 
their patients of the sanction action. In order to elect this option, 
the sanctioned practitioner or other person must, within 30 calendar 
days from receipt of the OIG notice, inform both new and existing 
patients through written notice--based on a suggested (non-mandatory) 
model provided to the sanctioned individual by the OIG--of the sanction 
and, in the case of an exclusion, its effective date. Receipt of the OIG 
notice is presumed to be 5 days after the date of the notice, unless 
there is a reasonable showing to the contrary. Within this same period, 
the practitioner or other person must also sign and return the 
certification that the OIG will provide with the notice. For purposes of 
this section, the term ``all existing patients'' includes all patients 
currently under active treatment with the practitioner or other person, 
as well as all patients who have been treated by the practitioner or 
other person within the last 3 years. In addition, the practitioner or 
other person must notify all prospective patients orally at the time 
such persons request an appointment. If the sanctioned party is a 
hospital, it must notify all physicians who have privileges at the 
hospital, and must post a notice in its emergency room, business office 
and in all affiliated entities regarding the exclusion. In addition, for 
purposes of this section, the term ``in all affiliated entities'' 
encompasses all entities and properties in which the hospital has a 
direct or indirect ownership interest of 5 percent or more and any 
management, partnership or control of the entity.
    (ii) The certification will provide that the practitioner or other 
person--
    (A) Has informed each of his, her or its patients in writing that 
the practitioner or other person has been sanctioned, or if a hospital, 
has informed all physicians having privileges at the hospital that it 
has been sanctioned;
    (B) If excluded from Medicare and the State health care programs, 
has informed his, her or its existing patients in writing that the 
programs will not pay for items and services furnished or ordered (or at 
the medical direction or on the prescription of an excluded physician) 
by the practitioner or other person until they are reinstated, or if a 
hospital, has provided this information

[[Page 744]]

to all physicians having privileges at that hospital;
    (C) If excluded from Medicare and State health care programs, will 
provide prospective patients--or if a hospital, physicians requesting 
privileges at that hospital prior to furnishing or ordering (or in the 
case of an excluded physician, medically directing or prescribing) 
services--oral information of both the sanction and that the programs 
will not pay for services provided and written notification of the same 
at the time of the provision of services;
    (D) If excluded from Medicare and State health care programs and is 
an entity such as a hospital, has posted a notice in its emergency room, 
business office and in all affiliated entities that the programs will 
not pay for services provided; and
    (E) Certifies to the truthfulness and accuracy of the notification 
and the statements in the certification.
    (2) If the sanctioned practitioner or other person does not inform 
his, her or its patients and does not return the required certification 
within the 30-day period, or if the sanctioned practitioner or other 
person returns the certification within the 30-day period but the OIG 
obtains reliable evidence that such person nevertheless has not 
adequately informed new and existing patients of the sanction, the OIG--
    (i) Will see that the public is notified directly of the identity of 
the sanctioned practitioner or other person, the finding that the 
obligation has been violated, and the effective date of any exclusion; 
and
    (ii) May consider this failure to adhere to the certification 
obligation as an adverse factor at the time the sanctioned practitioner 
or other person requests reinstatement.
    (3) If the sanctioned practitioner or other person is entitled to a 
preliminary hearing in accordance with Sec.  1004.140(a) and requests 
such a preliminary hearing, and if the administrative law judge (ALJ) 
decides that he, she or it poses a risk to program beneficiaries, the 
sanctioned practitioner or other person would have 30 days from the date 
of receipt of the ALJ's decision to provide certification to the OIG in 
accordance with Sec.  1004.110(d)(1). The date of receipt is presumed to 
be 5 days after the date of the ALJ's decision, unless there is a 
reasonable showing to the contrary.
    (e) Notice of the sanction is also provided to the following 
entities as appropriate--
    (1) The QIO that originated the sanction report;
    (2) QIOs in adjacent areas;
    (3) State Medicaid fraud control units and State licensing and 
accreditation bodies;
    (4) Appropriate program contractors and State agencies;
    (5) Hospitals, including the hospital where the sanctioned 
individual's case originated and where the individual currently has 
privileges, if known; skilled nursing facilities, home health agencies, 
and health maintenance organizations and Federally-funded community 
health centers where the practitioner or other person works;
    (6) Medical societies and other professional organizations; and
    (7) Medicare carriers and fiscal intermediaries, health care 
prepayment plans and other affected agencies and organizations.
    (f) If an exclusion sanction is effectuated because a decision was 
not made within 120 days after receipt of the QIO recommendation, 
notification is as follows--
    (1) As soon as possible after the 120th day, the OIG will issue a 
notice to the practitioner or other person, in compliance with the 
requirements of paragraph (c) of this section, affirming the QIO 
recommendation based on the OIG's review of the case, and that the 
exclusion is effective 20 days from the date of the notice; and
    (2) Notice of sanction is also provided as specified in paragraph 
(e) of this section.

[60 FR 63640, Dec. 12, 1995; 61 FR 1841, Jan. 24, 1996, as amended at 62 
FR 23143, Apr. 29, 1997]



               Subpart E_Effect and Duration of Exclusion



Sec.  1004.120  Effect of an exclusion on program payments and services.

    The effect of an exclusion is set forth in Sec.  1001.1901 of this 
chapter.

[[Page 745]]



Sec.  1004.130  Reinstatement after exclusion.

    (a) A practitioner or other person who has been excluded in 
accordance with this part may apply for reinstatement at the end of the 
period of exclusion. The OIG will consider any request for reinstatement 
in accordance with provisions of Sec. Sec.  1001.3001 through 1001.3005 
of this chapter.
    (b) The OIG may also consider a practitioner's or other person's 
compliance with the certification obligation in Sec.  1004.110(d) at the 
time of reinstatement.



                            Subpart F_Appeals



Sec.  1004.140  Appeal rights.

    (a) Right to preliminary hearing. (1)(i) A practitioner or other 
person excluded from participation in Medicare and any State health care 
programs under section 1156 of the Act may request a preliminary hearing 
if the location where services are rendered to over 50 percent of the 
practitioner's or other person's patients at the time of the exclusion 
notice is in a rural HPSA or in a county with a population of less than 
70,000.
    (ii) Unless the practitioner's or other person's practice meets the 
definition for psychiatric professional, vision care professional, 
dental professional, podiatric professional or pharmacy professional, 
the HPSA used by the OIG for determination of entitlement to a 
preliminary hearing will be the HPSA list for primary medical care 
professional.
    (iii) Information on the population size of a county in order to 
determine entitlement to a preliminary hearing will be obtained by the 
OIG from the responsible officials of that county.
    (2)(i) A request for a preliminary hearing must be made in writing 
and received by the Departmental Appeals Board (DAB) no later than the 
15th day after the notice of exclusion is received by a practitioner or 
other person. The date of receipt of the notice of exclusion by the 
practitioner or other person is presumed to be 5 days after the date 
appearing on the notice, unless there is a reasonable showing to the 
contrary.
    (ii) A request for a preliminary hearing will stay the effective 
date of the exclusion pending a decision of the ALJ at the preliminary 
hearing, and all the parties informed by the OIG of the exclusion will 
be notified of the stay.
    (iii) A request for a preliminary hearing received after the 15-day 
period has expired will be treated as a request for a hearing before an 
ALJ in accordance with paragraph (b) of this section.
    (iv) If the practitioner or other person exercises his, her or its 
right to a preliminary hearing, such a hearing must be held by the ALJ 
in accordance with paragraph (a)(3)(i) of this section unless the OIG 
waives it in accordance with paragraph (a)(6)(i) of this section.
    (v) The ALJ cannot consolidate the preliminary hearing with a full 
hearing without the approval of all parties to the hearing.
    (3)(i) The preliminary hearing will be conducted by an ALJ of the 
DAB in a city that the ALJ deems equitable to all parties. The ALJ will 
conduct the preliminary hearing and render a decision no later than 45 
days after receipt of the request for such a hearing by the DAB. Unless 
there is a reasonable showing to the contrary, date of receipt by the 
DAB is presumed to be 5 days after the date on the request for a 
preliminary hearing or, if undated, the date of receipt will be the date 
the DAB actually received the request. A reasonable extension to the 45-
day period of up to 15 days may be requested by any party to the 
preliminary hearing and such a request may be granted upon concurrence 
by all parties to the preliminary hearing. Such request must be received 
no later than 15 days prior to the scheduled date of the preliminary 
hearing.
    (ii) The only issue to be heard and decided on by the ALJ at the 
preliminary hearing, based on the preponderance of the evidence, is 
whether the practitioner's or other person's continued participation in 
the Medicare and State health care programs during the appeal of the 
exclusion before an ALJ would place program beneficiaries at serious 
risk. The ALJ's decision is to be based on the preponderance of the 
evidence.
    (iii) In the interest of time, the ALJ may issue an oral decision to 
be followed by a written decision.

[[Page 746]]

    (iv) In those cases where the ALJ has stayed an exclusion after a 
preliminary hearing, a full hearing must be held and a decision rendered 
by the ALJ within 6 months. If, for any reason, the request for a full 
hearing before the ALJ is withdrawn or dismissed, the practitioner or 
other person will be excluded effective 5 days after the notice of the 
withdrawal or dismissal is received in the OIG headquarters.
    (4) The preliminary hearing decision is not appealable or subject to 
further administrative or judicial review.
    (5) A practitioner or other person found at the preliminary hearing 
not to place program beneficiaries at serious risk, but later determined 
to have been properly excluded from program participation after a full 
hearing before an ALJ, is not entitled to have the exclusion stayed 
further during an appeal to the DAB. Exclusions in such instances will 
be effective 5 days after receipt of the ALJ decision in the OIG 
headquarters.
    (6)(i) After notice of a timely request for a preliminary hearing, 
the OIG may determine that the practitioner's or other person's 
continued program participation during the appeal before the ALJ will 
not place program beneficiaries at serious risk and waive the 
preliminary hearing. Under these circumstances, the exclusion will be 
stayed pending the decision of the ALJ after a full hearing. the hearing 
must be held, and a decision reached, within 6 months.
    (ii) If the OIG decides to waive the preliminary hearing, the 
request for the preliminary hearing will be considered a request for a 
hearing before the ALJ in accordance with paragraph (b) of this section.
    (b) Right to administrative review. (1) A practitioner or other 
person dissatisfied with an OIG determination, or an exclusion that 
results from a determination not being made within 120 days, is entitled 
to appeal such sanction in accordance with part 1005 of this chapter.
    (2) Due to the 120-day statutory requirement specified in Sec.  
1004.100(e), the following limitations apply--
    (i) The period of time for submitting additional information will 
not be extended.
    (ii) Any material received by the OIG after the 30-day period 
allowed will not be considered by the ALJ or the DAB.
    (3) The OIG's determination continues in effect unless reversed by a 
hearing.
    (c) Rights to judicial review. Any practitioner or other person 
dissatisfied with a final decision of the Secretary may file a civil 
action in accordance with the provisions of section 205(g) of the Act.



PART 1005_APPEALS OF EXCLUSIONS, CIVIL MONEY PENALTIES AND ASSESSMENTS--Table of Contents




Sec.
1005.1 Definitions.
1005.2 Hearing before an administrative law judge.
1005.3 Rights of parties.
1005.4 Authority of the ALJ.
1005.5 Ex parte contacts.
1005.6 Prehearing conferences.
1005.7 Discovery.
1005.8 Exchange of witness lists, witness statements and exhibits.
1005.9 Subpoenas for attendance at hearing.
1005.10 Fees.
1005.11 Form, filing and service of papers.
1005.12 Computation of time.
1005.13 Motions.
1005.14 Sanctions.
1005.15 The hearing and burden of proof.
1005.16 Witnesses.
1005.17 Evidence.
1005.18 The record.
1005.19 Post-hearing briefs.
1005.20 Initial decision.
1005.21 Appeal to DAB.
1005.22 Stay of initial decision.
1005.23 Harmless error.

    Authority: 42 U.S.C. 405(a), 405(b), 1302, 1320a-7, 1320a-7a and 
1320c-5.

    Source: 57 FR 3350, Jan. 29, 1992, unless otherwise noted.



Sec.  1005.1  Definitions.

    Civil money penalty cases refer to all proceedings arising under any 
of the statutory bases for which the OIG has been delegated authority to 
impose civil money penalties under Medicare or the State health care 
programs.
    DAB refers to the Departmental Appeals Board or its delegatee.
    Exclusion cases refer to all proceedings arising under any of the 
statutory bases for which the OIG has been

[[Page 747]]

delegated authority to impose exclusions under Medicare or the State 
health care programs.
    Inspector General (IG) means the Inspector General of the Department 
of Health and Human Services or his or her designees.

[57 FR 3350, Jan. 29, 1992, as amended at 65 FR 24418, Apr. 26, 2000]



Sec.  1005.2  Hearing before an administrative law judge.

    (a) A party sanctioned under any criteria specified in parts 1001, 
1003 and 1004 of this chapter may request a hearing before an ALJ.
    (b) In exclusion cases, the parties to the proceeding will consist 
of the petitioner and the IG. In civil money penalty cases, the parties 
to the proceeding will consist of the respondent and the IG.
    (c) The request for a hearing will be made in writing to the DAB; 
signed by the petitioner or respondent, or by his or her attorney; and 
sent by certified mail. The request must be filed within 60 days after 
the notice, provided in accordance with Sec. Sec.  1001.2002, 1001.203 
or 1003.109, is received by the petitioner or respondent. For purposes 
of this section, the date of receipt of the notice letter will be 
presumed to be 5 days after the date of such notice unless there is a 
reasonable showing to the contrary.
    (d) The request for a hearing will contain a statement as to the 
specific issues or findings of fact and conclusions of law in the notice 
letter with which the petitioner or respondent disagrees, and the basis 
for his or her contention that the specific issues or findings and 
conclusions were incorrect.
    (e) The ALJ will dismiss a hearing request where--
    (1) The petitioner's or the respondent's hearing request is not 
filed in a timely manner;
    (2) The petitioner or respondent withdraws his or her request for a 
hearing;
    (3) The petitioner or respondent abandons his or her request for a 
hearing; or
    (4) The petitioner's or respondent's hearing request fails to raise 
any issue which may properly be addressed in a hearing.

[57 FR 3350, Jan. 29, 1992, as amended at 65 FR 24418, Apr. 26, 2000]



Sec.  1005.3  Rights of parties.

    (a) Except as otherwise limited by this part, all parties may--
    (1) Be accompanied, represented and advised by an attorney;
    (2) Participate in any conference held by the ALJ;
    (3) Conduct discovery of documents as permitted by this part;
    (4) Agree to stipulations of fact or law which will be made part of 
the record;
    (5) Present evidence relevant to the issues at the hearing;
    (6) Present and cross-examine witnesses;
    (7) Present oral arguments at the hearing as permitted by the ALJ; 
and
    (8) Submit written briefs and proposed findings of fact and 
conclusions of law after the hearing.
    (b) Fees for any services performed on behalf of a party by an 
attorney are not subject to the provisions of section 206 of title II of 
the Act, which authorizes the Secretary to specify or limit these fees.



Sec.  1005.4  Authority of the ALJ.

    (a) The ALJ will conduct a fair and impartial hearing, avoid delay, 
maintain order and assure that a record of the proceeding is made.
    (b) The ALJ has the authority to--
    (1) Set and change the date, time and place of the hearing upon 
reasonable notice to the parties;
    (2) Continue or recess the hearing in whole or in part for a 
reasonable period of time;
    (3) Hold conferences to identify or simplify the issues, or to 
consider other matters that may aid in the expeditious disposition of 
the proceeding;
    (4) Administer oaths and affirmations;
    (5) Issue subpoenas requiring the attendance of witnesses at 
hearings and the production of documents at or in relation to hearings;
    (6) Rule on motions and other procedural matters;

[[Page 748]]

    (7) Regulate the scope and timing of documentary discovery as 
permitted by this part;
    (8) Regulate the course of the hearing and the conduct of 
representatives, parties, and witnesses;
    (9) Examine witnesses;
    (10) Receive, rule on, exclude or limit evidence;
    (11) Upon motion of a party, take official notice of facts;
    (12) Upon motion of a party, decide cases, in whole or in part, by 
summary judgment where there is no disputed issue of material fact; and
    (13) Conduct any conference, argument or hearing in person or, upon 
agreement of the parties, by telephone.
    (c) The ALJ does not have the authority to--
    (1) Find invalid or refuse to follow Federal statutes or regulations 
or secretarial delegations of authority;
    (2) Enter an order in the nature of a directed verdict;
    (3) Compel settlement negotiations;
    (4) Enjoin any act of the Secretary;
    (5) Review the exercise of discretion by the OIG to exclude an 
individual or entity under section 1128(b) of the Act, or determine the 
scope or effect of the exclusion,
    (6) Set a period of exclusion at zero, or reduce a period of 
exclusion to zero, in any case where the ALJ finds that an individual or 
entity committed an act described in section 1128(b) of the Act, or
    (7) Review the exercise of discretion by the OIG to impose a CMP, 
assessment or exclusion under part 1003 of this chapter.

[57 FR 3350, Jan. 29, 1992, as amended at 58 FR 5618, Jan. 22, 1993]



Sec.  1005.5  Ex parte contacts.

    No party or person (except employees of the ALJ's office) will 
communicate in any way with the ALJ on any matter at issue in a case, 
unless on notice and opportunity for all parties to participate. This 
provision does not prohibit a person or party from inquiring about the 
status of a case or asking routine questions concerning administrative 
functions or procedures.



Sec.  1005.6  Prehearing conferences.

    (a) The ALJ will schedule at least one prehearing conference, and 
may schedule additional prehearing conferences as appropriate, upon 
reasonable notice to the parties.
    (b) The ALJ may use prehearing conferences to discuss the 
following--
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations and admissions of fact or as to the contents and 
authenticity of documents;
    (4) Whether the parties can agree to submission of the case on a 
stipulated record;
    (5) Whether a party chooses to waive appearance at an oral hearing 
and to submit only documentary evidence (subject to the objection of 
other parties) and written argument;
    (6) Limitation of the number of witnesses;
    (7) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (8) Discovery of documents as permitted by this part;
    (9) The time and place for the hearing;
    (10) Such other matters as may tend to encourage the fair, just and 
expeditious disposition of the proceedings; and
    (11) Potential settlement of the case.
    (c) The ALJ will issue an order containing the matters agreed upon 
by the parties or ordered by the ALJ at a prehearing conference.



Sec.  1005.7  Discovery.

    (a) A party may make a request to another party for production of 
documents for inspection and copying which are relevant and material to 
the issues before the ALJ.
    (b) For the purpose of this section, the term documents includes 
information, reports, answers, records, accounts, papers and other data 
and documentary evidence. Nothing contained in this section will be 
interpreted to require the creation of a document, except that requested 
data stored in an electronic data storage system will be

[[Page 749]]

produced in a form accessible to the requesting party.
    (c) Requests for documents, requests for admissions, written 
interrogatories, depositions and any forms of discovery, other than 
those permitted under paragraph (a) of this section, are not authorized.
    (d) This section will not be construed to require the disclosure of 
interview reports or statements obtained by any party, or on behalf of 
any party, of persons who will not be called as witnesses by that party, 
or analyses and summaries prepared in conjunction with the investigation 
or litigation of the case, or any otherwise privileged documents.
    (e)(1) When a request for production of documents has been received, 
within 30 days the party receiving that request will either fully 
respond to the request, or state that the request is being objected to 
and the reasons for that objection. If objection is made to part of an 
item or category, the part will be specified. Upon receiving any 
objections, the party seeking production may then, within 30 days or any 
other time frame set by the ALJ, file a motion for an order compelling 
discovery. (The party receiving a request for production may also file a 
motion for protective order any time prior to the date the production is 
due.)
    (2) The ALJ may grant a motion for protective order or deny a motion 
for an order compelling discovery if the ALJ finds that the discovery 
sought--
    (i) Is irrelevant,
    (ii) Is unduly costly or burdensome,
    (iii) Will unduly delay the proceeding, or
    (iv) Seeks privileged information.
    (3) The ALJ may extend any of the time frames set forth in paragraph 
(e)(1) of this section.
    (4) The burden of showing that discovery should be allowed is on the 
party seeking discovery.

[57 FR 3350, Jan. 29, 1992, as amended at 58 FR 5618, Jan. 22, 1993; 65 
FR 24418, Apr. 26, 2000; 65 FR 35584, June 5, 2000; 67 FR 11936, Mar. 
18, 2002]



Sec.  1005.8  Exchange of witness lists, witness statements and exhibits.

    (a) At least 15 days before the hearing, the ALJ will order the 
parties to exchange witness lists, copies of prior written statements of 
proposed witnesses and copies of proposed hearing exhibits, including 
copies of any written statements that the party intends to offer in lieu 
of live testimony in accordance with Sec.  1005.16.
    (b) (1) If at any time a party objects to the proposed admission of 
evidence not exchanged in accordance with paragraph (a) of this section, 
the ALJ will determine whether the failure to comply with paragraph (a) 
of this section should result in the exclusion of such evidence.
    (2) Unless the ALJ finds that extraordinary circumstances justified 
the failure to timely exchange the information listed under paragraph 
(a) of this section, the ALJ must exclude from the party's case-in-
chief:
    (i) The testimony of any witness whose name does not appear on the 
witness list, and
    (ii) Any exhibit not provided to the opposing party as specified in 
paragraph (a) of this section.
    (3) If the ALJ finds that extraordinary circumstances existed, the 
ALJ must then determine whether the admission of such evidence would 
cause substantial prejudice to the objecting party. If the ALJ finds 
that there is no substantial prejudice, the evidence may be admitted. If 
the ALJ finds that there is substantial prejudice, the ALJ may exclude 
the evidence, or at his or her discretion, may postpone the hearing for 
such time as is necessary for the objecting party to prepare and respond 
to the evidence.
    (c) Unless another party objects within a reasonable period of time 
prior to the hearing, documents exchanged in accordance with paragraph 
(a) of this section will be deemed to be authentic for the purpose of 
admissibility at the hearing.



Sec.  1005.9  Subpoenas for attendance at hearing.

    (a) A party wishing to procure the appearance and testimony of any 
individual at the hearing may make a motion requesting the ALJ to issue 
a subpoena if the appearance and testimony are reasonably necessary for 
the presentation of a party's case.

[[Page 750]]

    (b) A subpoena requiring the attendance of an individual in 
accordance with paragraph (a) of this section may also require the 
individual (whether or not the individual is a party) to produce 
evidence authorized under Sec.  1005.7 of this part at or prior to the 
hearing.
    (c) When a subpoena is served by a respondent or petitioner on a 
particular individual or particular office of the OIG, the OIG may 
comply by designating any of its representatives to appear and testify.
    (d) A party seeking a subpoena will file a written motion not less 
than 30 days before the date fixed for the hearing, unless otherwise 
allowed by the ALJ for good cause shown. Such request will:
    (1) Specify any evidence to be produced,
    (2) Designate the witnesses, and
    (3) Describe the address and location with sufficient particularity 
to permit such witnesses to be found.
    (e) The subpoena will specify the time and place at which the 
witness is to appear and any evidence the witness is to produce.
    (f) Within 15 days after the written motion requesting issuance of a 
subpoena is served, any party may file an opposition or other response.
    (g) If the motion requesting issuance of a subpoena is granted, the 
party seeking the subpoena will serve it by delivery to the individual 
named, or by certified mail addressed to such individual at his or her 
last dwelling place or principal place of business.
    (h) The individual to whom the subpoena is directed may file with 
the ALJ a motion to quash the subpoena within 10 days after service.
    (i) The exclusive remedy for contumacy by, or refusal to obey a 
subpoena duly served upon, any person is specified in section 205(e) of 
the Social Security Act (42 U.S.C. 405(e)).

[57 FR 3350, Jan. 29, 1992, as amended at 65 FR 24418, Apr. 26, 2000]



Sec.  1005.10  Fees.

    The party requesting a subpoena will pay the cost of the fees and 
mileage of any witness subpoenaed in the amounts that would be payable 
to a witness in a proceeding in United States District Court. A check 
for witness fees and mileage will accompany the subpoena when served, 
except that when a subpoena is issued on behalf of the IG, a check for 
witness fees and mileage need not accompany the subpoena.



Sec.  1005.11  Form, filing and service of papers.

    (a) Forms. (1) Unless the ALJ directs the parties to do otherwise, 
documents filed with the ALJ will include an original and two copies.
    (2) Every pleading and paper filed in the proceeding will contain a 
caption setting forth the title of the action, the case number, and a 
designation of the paper, such as motion to quash subpoena.
    (3) Every pleading and paper will be signed by, and will contain the 
address and telephone number of the party or the person on whose behalf 
the paper was filed, or his or her representative.
    (4) Papers are considered filed when they are mailed.
    (b) Service. A party filing a document with the ALJ or the Secretary 
will, at the time of filing, serve a copy of such document on every 
other party. Service upon any party of any document will be made by 
delivering a copy, or placing a copy of the document in the United 
States mail, postage prepaid and addressed, or with a private delivery 
service, to the party's last known address. When a party is represented 
by an attorney, service will be made upon such attorney in lieu of the 
party.
    (c) Proof of service. A certificate of the individual serving the 
document by personal delivery or by mail, setting forth the manner of 
service, will be proof of service.



Sec.  1005.12  Computation of time.

    (a) In computing any period of time under this part or in an order 
issued thereunder, the time begins with the day following the act, event 
or default, and includes the last day of the period unless it is a 
Saturday, Sunday or legal holiday observed by the Federal Government, in 
which event it includes the next business day.

[[Page 751]]

    (b) When the period of time allowed is less than 7 days, 
intermediate Saturdays, Sundays and legal holidays observed by the 
Federal Government will be excluded from the computation.
    (c) Where a document has been served or issued by placing it in the 
mail, an additional 5 days will be added to the time permitted for any 
response. This paragraph does not apply to requests for hearing under 
Sec.  1005.2.



Sec.  1005.13  Motions.

    (a) An application to the ALJ for an order or ruling will be by 
motion. Motions will state the relief sought, the authority relied upon 
and the facts alleged, and will be filed with the ALJ and served on all 
other parties.
    (b) Except for motions made during a prehearing conference or at the 
hearing, all motions will be in writing. The ALJ may require that oral 
motions be reduced to writing.
    (c) Within 10 days after a written motion is served, or such other 
time as may be fixed by the ALJ, any party may file a response to such 
motion.
    (d) The ALJ may not grant a written motion before the time for 
filing responses has expired, except upon consent of the parties or 
following a hearing on the motion, but may overrule or deny such motion 
without awaiting a response.
    (e) The ALJ will make a reasonable effort to dispose of all 
outstanding motions prior to the beginning of the hearing.



Sec.  1005.14  Sanctions.

    (a) The ALJ may sanction a person, including any party or attorney, 
for failing to comply with an order or procedure, for failing to defend 
an action or for other misconduct that interferes with the speedy, 
orderly or fair conduct of the hearing. Such sanctions will reasonably 
relate to the severity and nature of the failure or misconduct. Such 
sanction may include--
    (1) In the case of refusal to provide or permit discovery under the 
terms of this part, drawing negative factual inferences or treating such 
refusal as an admission by deeming the matter, or certain facts, to be 
established;
    (2) Prohibiting a party from introducing certain evidence or 
otherwise supporting a particular claim or defense;
    (3) Striking pleadings, in whole or in part;
    (4) Staying the proceedings;
    (5) Dismissal of the action;
    (6) Entering a decision by default; and
    (7) Refusing to consider any motion or other action that is not 
filed in a timely manner.
    (b) In civil money penalty cases commenced under section 1128A of 
the Act or under any provision which incorporates section 1128A(c)(4) of 
the Act, the ALJ may also order the party or attorney who has engaged in 
any of the acts described in paragraph (a) of this section to pay 
attorney's fees and other costs caused by the failure or misconduct.



Sec.  1005.15  The hearing and burden of proof.

    (a) The ALJ will conduct a hearing on the record in order to 
determine whether the petitioner or respondent should be found liable 
under this part.
    (b) With regard to the burden of proof in civil money penalty cases 
under part 1003, in Quality Improvement Organization exclusion cases 
under part 1004, and in exclusion cases under Sec. Sec.  1001.701, 
1001.901 and 1001.951 of this chapter--
    (1) The respondent or petitioner, as applicable, bears the burden of 
going forward and the burden of persuasion with respect to affirmative 
defenses and any mitigating circumstances; and
    (2) The IG bears the burden of going forward and the burden of 
persuasion with respect to all other issues.
    (c) Burden of proof in all other exclusion cases. In all exclusion 
cases except those governed by paragraph (b) of this section, the ALJ 
will allocate the burden of proof as the ALJ deems appropriate.
    (d) The burden of persuasion will be judged by a preponderance of 
the evidence.
    (e) The hearing will be open to the public unless otherwise ordered 
by the ALJ for good cause shown.
    (f)(1) A hearing under this part is not limited to specific items 
and information set forth in the notice letter to the petitioner or 
respondent. Subject to the 15-day requirement under

[[Page 752]]

Sec.  1005.8, additional items and information, including aggravating or 
mitigating circumstances that arose or became known subsequent to the 
issuance of the notice letter, may be introduced by either party during 
its case-in-chief unless such information or items are--
    (i) Privileged;
    (ii) Disqualified from consideration due to untimeliness in 
accordance with Sec.  1004.130(a)(2)(ii); or
    (iii) Deemed otherwise inadmissible under Sec.  1005.17.
    (2) After both parties have presented their cases, evidence may be 
admitted on rebuttal even if not previously exchanged in accordance with 
Sec.  1005.8.

[57 FR 3350, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998; 65 
FR 24418, Apr. 26, 2000]



Sec.  1005.16  Witnesses.

    (a) Except as provided in paragraph (b) of this section, testimony 
at the hearing will be given orally by witnesses under oath or 
affirmation.
    (b) At the discretion of the ALJ, testimony (other than expert 
testimony) may be admitted in the form of a written statement. The ALJ 
may, at his or her discretion, admit prior sworn testimony of experts 
which has been subject to adverse examination, such as a deposition or 
trial testimony. Any such written statement must be provided to all 
other parties along with the last known address of such witnesses, in a 
manner that allows sufficient time for other parties to subpoena such 
witness for cross-examination at the hearing. Prior written statements 
of witnesses proposed to testify at the hearing will be exchanged as 
provided in Sec.  1005.8.
    (c) The ALJ will exercise reasonable control over the mode and order 
of interrogating witnesses and presenting evidence so as to:
    (1) Make the interrogation and presentation effective for the 
ascertainment of the truth,
    (2) Avoid repetition or needless consumption of time, and
    (3) Protect witnesses from harassment or undue embarrassment.
    (d) The ALJ will permit the parties to conduct such cross-
examination of witnesses as may be required for a full and true 
disclosure of the facts.
    (e) The ALJ may order witnesses excluded so that they cannot hear 
the testimony of other witnesses. This does not authorize exclusion of--
    (1) A party who is an individual;
    (2) In the case of a party that is not an individual, an officer or 
employee of the party appearing for the entity pro se or designated as 
the party's representative; or
    (3) An individual whose presence is shown by a party to be essential 
to the presentation of its case, including an individual engaged in 
assisting the attorney for the IG.

[57 FR 3350, Jan. 29, 1992, as amended at 67 FR 11936, Mar. 18, 2002]



Sec.  1005.17  Evidence.

    (a) The ALJ will determine the admissibility of evidence.
    (b) Except as provided in this part, the ALJ will not be bound by 
the Federal Rules of Evidence. However, the ALJ may apply the Federal 
Rules of Evidence where appropriate, for example, to exclude unreliable 
evidence.
    (c) The ALJ must exclude irrelevant or immaterial evidence.
    (d) Although relevant, evidence may be excluded if its probative 
value is substantially outweighed by the danger of unfair prejudice, 
confusion of the issues, or by considerations of undue delay or needless 
presentation of cumulative evidence.
    (e) Although relevant, evidence must be excluded if it is privileged 
under Federal law.
    (f) Evidence concerning offers of compromise or settlement made in 
this action will be inadmissible to the extent provided in Rule 408 of 
the Federal Rules of Evidence.
    (g) Evidence of crimes, wrongs or acts other than those at issue in 
the instant case is admissible in order to show motive, opportunity, 
intent, knowledge, preparation, identity, lack of mistake, or existence 
of a scheme. Such evidence is admissible regardless of whether the 
crimes, wrongs or acts occurred during the statute of limitations period 
applicable to the acts which constitute the basis for liability in the 
case, and regardless of whether they were referenced in the IG's notice 
sent in accordance with Sec. Sec.  1001.2002, 1001.2003 or 1003.109.

[[Page 753]]

    (h) The ALJ will permit the parties to introduce rebuttal witnesses 
and evidence.
    (i) All documents and other evidence offered or taken for the record 
will be open to examination by all parties, unless otherwise ordered by 
the ALJ for good cause shown.
    (j) The ALJ may not consider evidence regarding the issue of 
willingness and ability to enter into and successfully complete a 
corrective action plan when such evidence pertains to matters occurring 
after the submittal of the case to the Secretary. The determination 
regarding the appropriateness of any corrective action plan is not 
reviewable.



Sec.  1005.18  The record.

    (a) The hearing will be recorded and transcribed. Transcripts may be 
obtained following the hearing from the ALJ.
    (b) The transcript of testimony, exhibits and other evidence 
admitted at the hearing, and all papers and requests filed in the 
proceeding constitute the record for the decision by the ALJ and the 
Secretary.
    (c) The record may be inspected and copied (upon payment of a 
reasonable fee) by any person, unless otherwise ordered by the ALJ for 
good cause shown.
    (d) For good cause, the ALJ may order appropriate redactions made to 
the record.



Sec.  1005.19  Post-hearing briefs.

    The ALJ may require the parties to file post-hearing briefs. In any 
event, any party may file a post-hearing brief. The ALJ will fix the 
time for filing such briefs which are not to exceed 60 days from the 
date the parties receive the transcript of the hearing or, if 
applicable, the stipulated record. Such briefs may be accompanied by 
proposed findings of fact and conclusions of law. The ALJ may permit the 
parties to file reply briefs.



Sec.  1005.20  Initial decision.

    (a) The ALJ will issue an initial decision, based only on the 
record, which will contain findings of fact and conclusions of law.
    (b) The ALJ may affirm, increase or reduce the penalties, assessment 
or exclusion proposed or imposed by the IG, or reverse the imposition of 
the exclusion. In exclusion cases where the period of exclusion 
commenced prior to the hearing, any period of exclusion imposed by the 
ALJ will be deemed to commence on the date such exclusion originally 
went into effect.
    (c) The ALJ will issue the initial decision to all parties within 60 
days after the time for submission of post-hearing briefs and reply 
briefs, if permitted, has expired. The decision will be accompanied by a 
statement describing the right of any party to file a notice of appeal 
with the DAB and instructions for how to file such appeal. If the ALJ 
fails to meet the deadline contained in this paragraph, he or she will 
notify the parties of the reason for the delay and will set a new 
deadline.
    (d) Except for exclusion actions taken in accordance with Sec.  
1001.2003 of this chapter and as provided in paragraph (e) of this 
section, unless the initial decision is appealed to the DAB, it will be 
final and binding on the parties 30 days after the ALJ serves the 
parties with a copy of the decision. If service is by mail, the date of 
service will be deemed to be 5 days from the date of mailing.
    (e) If an extension of time within which to appeal the initial 
decision is granted under Sec.  1005.21(a), except as provided in Sec.  
1005.22(a), the initial decision will become final and binding on the 
day following the end of the extension period.

[57 FR 3350, Jan. 29, 1992, as amended at 65 FR 24418, Apr. 26, 2000]



Sec.  1005.21  Appeal to DAB.

    (a) Any party may appeal the initial decision of the ALJ to the DAB 
by filing a notice of appeal with the DAB within 30 days of the date of 
service of the initial decision. The DAB may extend the initial 30 day 
period for a period of time not to exceed 30 days if a party files with 
the DAB a request for an extension within the initial 30 day period and 
shows good cause.
    (b) If a party files a timely notice of appeal with the DAB, the ALJ 
will forward the record of the proceeding to the DAB.

[[Page 754]]

    (c) A notice of appeal will be accompanied by a written brief 
specifying exceptions to the initial decision and reasons supporting the 
exceptions. Any party may file a brief in opposition to exceptions, 
which may raise any relevant issue not addressed in the exceptions, 
within 30 days of receiving the notice of appeal and accompanying brief. 
The DAB may permit the parties to file reply briefs.
    (d) There is no right to appear personally before the DAB or to 
appeal to the DAB any interlocutory ruling by the ALJ, except on the 
timeliness of a filing of the hearing request.
    (e) The DAB will not consider any issue not raised in the parties' 
briefs, nor any issue in the briefs that could have been raised before 
the ALJ but was not.
    (f) If any party demonstrates to the satisfaction of the DAB that 
additional evidence not presented at such hearing is relevant and 
material and that there were reasonable grounds for the failure to 
adduce such evidence at such hearing, the DAB may remand the matter to 
the ALJ for consideration of such additional evidence.
    (g) The DAB may decline to review the case, or may affirm, increase, 
reduce, reverse or remand any penalty, assessment or exclusion 
determined by the ALJ.
    (h) The standard of review on a disputed issue of fact is whether 
the initial decision is supported by substantial evidence on the whole 
record. The standard of review on a disputed issue of law is whether the 
initial decision is erroneous.
    (i) Within 60 days after the time for submission of briefs and reply 
briefs, if permitted, has expired, the DAB will issue to each party to 
the appeal a copy of the DAB's decision and a statement describing the 
right of any petitioner or respondent who is found liable to seek 
judicial review.
    (j) Except with respect to any penalty, assessment or exclusion 
remanded by the ALJ, the DAB's decision, including a decision to decline 
review of the initial decision, becomes final and binding 60 days after 
the date on which the DAB serves the parties with a copy of the 
decision. If service is by mail, the date of service will be deemed to 
be 5 days from the date of mailing.
    (k) (1) Any petition for judicial review must be filed within 60 
days after the DAB serves the parties with a copy of the decision. If 
service is by mail, the date of service will be deemed to be 5 days from 
the date of mailing.
    (2) In compliance with 28 U.S.C. 2112(a), a copy of any petition for 
judicial review filed in any U.S. Court of Appeals challenging a final 
action of the DAB will be sent by certified mail, return receipt 
requested, to the Chief Counsel to the IG. The petition copy will be 
time-stamped by the clerk of the court when the original is filed with 
the court.
    (3) If the Chief Counsel to the IG receives two or more petitions 
within 10 days after the DAB issues its decision, the Chief Counsel to 
the IG will notify the U.S. Judicial Panel on Multidistrict Litigation 
of any petitions that were received within the 10-day period.

[57 FR 3350, Jan. 29, 1992, as amended at 63 FR 46691, Sept. 2, 1998; 65 
FR 24419, Apr. 26, 2000]



Sec.  1005.22  Stay of initial decision.

    (a) In a CMP case under section 1128A of the Act, the filing of a 
respondent's request for review by the DAB will automatically stay the 
effective date of the ALJ's decision.
    (b) (1) After the DAB renders a decision in a CMP case, pending 
judicial review, the respondent may file a request for stay of the 
effective date of any penalty or assessment with the ALJ. The request 
must be accompanied by a copy of the notice of appeal filed with the 
Federal court. The filing of such a request will automatically act to 
stay the effective date of the penalty or assessment until such time as 
the ALJ rules upon the request.
    (2) The ALJ may not grant a respondent's request for stay of any 
penalty or assessment unless the respondent posts a bond or provides 
other adequate security.
    (3) The ALJ will rule upon a respondent's request for stay within 10 
days of receipt.



Sec.  1005.23  Harmless error.

    No error in either the admission or the exclusion of evidence, and 
no error

[[Page 755]]

or defect in any ruling or order or in any act done or omitted by the 
ALJ or by any of the parties, including Federal representatives such as 
Medicare carriers and intermediaries and Quality Improvement 
Organizations, is ground for vacating, modifying or otherwise disturbing 
an otherwise appropriate ruling or order or act, unless refusal to take 
such action appears to the ALJ or the DAB inconsistent with substantial 
justice. The ALJ and the DAB at every stage of the proceeding will 
disregard any error or defect in the proceeding that does not affect the 
substantial rights of the parties.



PART 1006_INVESTIGATIONAL INQUIRIES--Table of Contents




Sec.
1006.1 Scope.
1006.2 Contents of subpoena.
1006.3 Service and fees.
1006.4 Procedures for investigational inquiries.
1006.5 Enforcement of a subpoena.

    Authority: 42 U.S.C. 405(d), 405(e), 1302 and 1320a-7a.

    Source: 57 FR 3354, Jan. 29, 1992, unless otherwise noted.



Sec.  1006.1  Scope.

    (a) The provisions in this part govern subpoenas issued by the 
Inspector General, or his or her delegates, in accordance with sections 
205(d) and 1128A(j) of the Act, and require the attendance and testimony 
of witnesses and the production of any other evidence at an 
investigational inquiry.
    (b) Such subpoenas may be issued in investigations under section 
1128A of the Act or under any other section of the Act that incorporates 
the provisions of section 1128A(j).
    (c) Nothing in this part is intended to apply to or limit the 
authority of the Inspector General, or his or her delegates, to issue 
subpoenas for the production of documents in accordance with 5 U.S.C. 
6(a)(4), App. 3.



Sec.  1006.2  Contents of subpoena.

    A subpoena issued under this part will--
    (a) State the name of the individual or entity to whom the subpoena 
is addressed;
    (b) State the statutory authority for the subpoena;
    (c) Indicate the date, time and place that the investigational 
inquiry at which the witness is to testify will take place;
    (d) Include a reasonably specific description of any documents or 
items required to be produced; and
    (e) If the subpoena is addressed to an entity, describe with 
reasonable particularity the subject matter on which testimony is 
required. In such event, the named entity will designate one or more 
individuals who will testify on its behalf, and will state as to each 
individual so designated that individual's name and address and the 
matters on which he or she will testify. The individual so designated 
will testify as to matters known or reasonably available to the entity.



Sec.  1006.3  Service and fees.

    (a) A subpoena under this part will be served by--
    (1) Delivering a copy to the individual named in the subpoena;
    (2) Delivering a copy to the entity named in the subpoena at its 
last principal place of business; or
    (3) Registered or certified mail addressed to such individual or 
entity at its last known dwelling place or principal place of business.
    (b) A verified return by the individual serving the subpoena setting 
forth the manner of service or, in the case of service by registered or 
certified mail, the signed return post office receipt, will be proof of 
service.
    (c) Witnesses will be entitled to the same fees and mileage as 
witnesses in the district courts of the United States (28 U.S.C. 1821 
and 1825). Such fees need not be paid at the time the subpoena is 
served.



Sec.  1006.4  Procedures for investigational inquiries.

    (a) Testimony at investigational inquiries will be taken under oath 
or affirmation.
    (b) Investigational inquiries are non-public investigatory 
proceedings. Attendance of non-witnesses is within the discretion of the 
OIG, except that--

[[Page 756]]

    (1) A witness is entitled to be accompanied, represented and advised 
by an attorney; and
    (2) Representatives of the OIG are entitled to attend and ask 
questions.
    (c) A witness will have an opportunity to clarify his or her answers 
on the record following the questions by the OIG.
    (d) Any claim of privilege must be asserted by the witness on the 
record.
    (e) Objections must be asserted on the record. Errors of any kind 
that might be corrected if promptly presented will be deemed to be 
waived unless reasonable objection is made at the investigational 
inquiry. Except where the objection is on the grounds of privilege, the 
question will be answered on the record, subject to the objection.
    (f) If a witness refuses to answer any question not privileged or to 
produce requested documents or items, or engages in conduct likely to 
delay or obstruct the investigational inquiry, the OIG may seek 
enforcement of the subpoena under Sec.  1006.5.
    (g)(1) The proceedings will be recorded and transcribed.
    (2) The witness is entitled to a copy of the transcript, upon 
payment of prescribed costs, except that, for good cause, the witness 
may be limited to inspection of the official transcript of his or her 
testimony.
    (3)(i) The transcript will be submitted to the witness for 
signature.
    (ii) Where the witness will be provided a copy of the transcript, 
the transcript will be submitted to the witness for signature. The 
witness may submit to the OIG written proposed corrections to the 
transcript, with such corrections attached to the transcript. If the 
witness does not return a signed copy of the transcript or proposed 
corrections within 30 days of its being submitted to him or her for 
signature, the witness will be deemed to have agreed that the transcript 
is true and accurate.
    (iii) Where, as provided in paragraph (g)(2) of this section, the 
witness is limited to inspecting the transcript, the witness will have 
the opportunity at the time of inspection to propose corrections to the 
transcript, with corrections attached to the transcript. The witness 
will also have the opportunity to sign the transcript. If the witness 
does not sign the transcript or offer corrections within 30 days of 
receipt of notice of the opportunity to inspect the transcript, the 
witness will be deemed to have agreed that the transcript is true and 
accurate.
    (iv) The OIG's proposed corrections the record of transcript will be 
attached to the transcript.
    (h) Testimony and other evidence obtained in an investigational 
inquiry may be used by the OIG or DHHS in any of its activities, and may 
be used or offered into evidence in any administrative or judicial 
proceeding.

[57 FR 3354, Jan. 29, 1992, as amended at 65 FR 24419, Apr. 26, 2000]



Sec.  1006.5  Enforcement of a subpoena.

    A subpoena to appear at an investigational inquiry is enforceable 
through the District Court of the United States and the district where 
the subpoenaed person is found, resides or transacts business.



PART 1007_STATE MEDICAID FRAUD CONTROL UNITS--Table of Contents




Sec.
1007.1 Definitions.
1007.3 Scope and purpose.
1007.5 Basic requirement.
1007.7 Organization and location requirements.
1007.9 Relationship to, and agreement with, the Medicaid agency.
1007.11 Duties and responsibilities of the unit.
1007.13 Staffing requirements.
1007.15 Applications, certification and recertification.
1007.17 Annual report.
1007.19 Federal financial participation (FFP).
1007.21 Other applicable HHS regulations.

    Authority: 42 U.S.C. 1396b(a)(6), 1396b(b)(3) and 1396b(q).

    Source: 57 FR 3355, Jan. 29, 1992, unless otherwise noted.



Sec.  1007.1  Definitions.

    As used in this part, unless otherwise indicated by the context:
    Employ or employee, as the context requires, means full-time duty 
intended to last at least a year. It includes an arrangement whereby an 
individual is

[[Page 757]]

on full-time detail or assignment to the unit from another government 
agency, if the detail or assignment is for a period of at least 1 year 
and involves supervision by the unit.
    Provider means an individual or entity that furnishes items or 
services for which payment is claimed under Medicaid.
    Unit means the State Medicaid fraud control unit.



Sec.  1007.3  Scope and purpose.

    This part implements sections 1903(a)(6), 1903(b)(3), and 1903(q) of 
the Social Security Act, as amended by the Medicare-Medicaid Anti-Fraud 
and Abuse Amendments (Pub. L. 95-142). The statute authorizes the 
Secretary to pay a State 90 percent of the costs of establishing and 
operating a State Medicaid fraud control unit, as defined by the 
statute, for the purpose of eliminating fraud in the State Medicaid 
program.



Sec.  1007.5  Basic requirement.

    A State Medicaid fraud control unit must be a single identifiable 
entity of the State government certified by the Secretary as meeting the 
requirements of Sec. Sec.  1007.7 through 1007.13 of this part.



Sec.  1007.7  Organization and location requirements.

    Any of the following three alternatives is acceptable:
    (a) The unit is located in the office of the State Attorney General 
or another department of State government which has Statewide authority 
to prosecute individuals for violations of criminal laws with respect to 
fraud in the provision or administration of medical assistance under a 
State plan implementing title XIX of the Act;
    (b) If there is no State agency with Statewide authority and 
capability for criminal fraud prosecutions, the unit has established 
formal procedures that assure that the unit refers suspected cases of 
criminal fraud in the State Medicaid program to the appropriate State 
prosecuting authority or authorities, and provides assistance and 
coordination to such authority or authorities in the prosecution of such 
cases; or
    (c) The unit has a formal working relationship with the office of 
the State Attorney General and has formal procedures for referring to 
the Attorney General suspected criminal violations occurring in the 
State Medicaid program and for effective coordination of the activities 
of both entities relating to the detection, investigation and 
prosecution of those violations. Under this requirement, the office of 
the State Attorney General must agree to assume responsibility for 
prosecuting alleged criminal violations referred to it by the unit. 
However, if the Attorney General finds that another prosecuting 
authority has the demonstrated capacity, experience and willingness to 
prosecute an alleged violation, he or she may refer a case to that 
prosecuting authority, as long as the Attorney General's Office 
maintains oversight responsibility for the prosecution and for 
coordination between the unit and the prosecuting authority.



Sec.  1007.9  Relationship to, and agreement with, the Medicaid agency.

    (a) The unit must be separate and distinct from the Medicaid agency.
    (b) No official of the Medicaid agency will have authority to review 
the activities of the unit or to review or overrule the referral of a 
suspected criminal violation to an appropriate prosecuting authority.
    (c) The unit will not receive funds paid under this part either from 
or through the Medicaid agency.
    (d) The unit will enter into an agreement with the Medicaid agency 
under which the Medicaid agency will agree to comply with all 
requirements of Sec.  455.21(a)(2) of this title.



Sec.  1007.11  Duties and responsibilities of the unit.

    (a) The unit will conduct a Statewide program for investigating and 
prosecuting (or referring for prosecution) violations of all applicable 
State laws pertaining to fraud in the administration of the Medicaid 
program, the provision of medical assistance, or the activities of 
providers of medical assistance under the State Medicaid plan.

[[Page 758]]

    (b) (1) The unit will also review complaints alleging abuse or 
neglect of patients in health care facilities receiving payments under 
the State Medicaid plan and may review complaints of the 
misappropriation of patient's private funds in such facilities.
    (2) If the initial review indicates substantial potential for 
criminal prosecution, the unit will investigate the complaint or refer 
it to an appropriate criminal investigative or prosecutive authority.
    (3) If the initial review does not indicate a substantial potential 
for criminal prosecution, the unit will refer the complaint to an 
appropriate State agency.
    (c) If the unit, in carrying out its duties and responsibilities 
under paragraphs (a) and (b) of this section, discovers that 
overpayments have been made to a health care facility or other provider 
of medical assistance under the State Medicaid plan, the unit will 
either attempt to collect such overpayment or refer the matter to an 
appropriate State agency for collection.
    (d) Where a prosecuting authority other than the unit is to assume 
responsibility for the prosecution of a case investigated by the unit, 
the unit will insure that those responsible for the prosecutive decision 
and the preparation of the case for trial have the fullest possible 
opportunity to participate in the investigation from its inception and 
will provide all necessary assistance to the prosecuting authority 
throughout all resulting prosecutions.
    (e) The unit will make available to Federal investigators or 
prosecutors all information in its possession concerning fraud in the 
provision or administration of medical assistance under the State plan 
and will cooperate with such officials in coordinating any Federal and 
State investigations or prosecutions involving the same suspects or 
allegations.
    (f) The unit will safeguard the privacy rights of all individuals 
and will provide safeguards to prevent the misuse of information under 
the unit's control.



Sec.  1007.13  Staffing requirements.

    (a) The unit will employ sufficient professional, administrative, 
and support staff to carry out its duties and responsibilities in an 
effective and efficient manner. The staff must include:
    (1) One or more attorneys experienced in the investigation or 
prosecution of civil fraud or criminal cases, who are capable of giving 
informed advice on applicable law and procedures and providing effective 
prosecution or liaison with other prosecutors;
    (2) One or more experienced auditors capable of supervising the 
review of financial records and advising or assisting in the 
investigation of alleged fraud; and
    (3) A senior investigator with substantial experience in commercial 
or financial investigations who is capable of supervising and directing 
the investigative activities of the unit.
    (b) The unit will employ, or have available to it, professional 
staff who are knowledgeable about the provision of medical assistance 
under title XIX and about the operation of health care providers.



Sec.  1007.15  Applications, certification and recertification.

    (a) Initial application. In order to receive FFP under this part, 
the unit must submit to the Secretary, an application approved by the 
Governor, containing the following information and documentation--
    (1) A description of the applicant's organization, structure, and 
location within State government, and an indication of whether it seeks 
certification under Sec.  1007.7 (a), (b), or (c);
    (2) A statement from the State Attorney General that the applicant 
has authority to carry out the functions and responsibilities set forth 
in this part. If the applicant seeks certification under Sec.  
1007.7(b), the statement must also specify either that--
    (i) There is no State agency with the authority to exercise 
Statewide prosecuting authority for the violations with which the unit 
is concerned, or
    (ii) Although the State Attorney General may have common law 
authority for Statewide criminal prosecutions, he or she has not 
exercised that authority;
    (3) A copy of whatever memorandum of agreement, regulation, or other 
document sets forth the formal procedures

[[Page 759]]

required under Sec.  1007.7(b), or the formal working relationship and 
procedures required under Sec.  1007.7(c);
    (4) A copy of the agreement with the Medicaid agency required under 
Sec.  1007.9;
    (5) A statement of the procedures to be followed in carrying out the 
functions and responsibilities of this part;
    (6) A projection of the caseload and a proposed budget for the 12-
month period for which certification is sought; and
    (7) Current and projected staffing, including the names, education, 
and experience of all senior professional staff already employed and job 
descriptions, with minimum qualifications, for all professional 
positions.
    (b) Conditions for, and notification of certification. (1) The 
Secretary will approve an application only if he or she has specifically 
approved the applicant's formal procedures under Sec.  1007.7 (b) or 
(c), if either of those provisions is applicable, and has specifically 
certified that the applicant meets the requirements of Sec.  1007.7;
    (2) The Secretary will promptly notify the applicant whether the 
application meets the requirements of this part and is approved. If the 
application is not approved, the applicant may submit an amended 
application at any time. Approval and certification will be for a period 
of 1 year.
    (c) Conditions for recertification. In order to continue receiving 
payments under this part, a unit must submit a reapplication to the 
Secretary at least 60 days prior to the expiration of the 12-month 
certification period. A reapplication must--
    (1) Advise the Secretary of any changes in the information or 
documentation required under paragraphs (a) (1) through (5) of this 
section;
    (2) Provide projected caseload and proposed budget for the 
recertification period; and
    (3) Include or reference the annual report required under Sec.  
1007.17.
    (d) Basis for recertification. (1) The Secretary will consider the 
unit's reapplication, the reports required under Sec.  1007.17, and any 
other reviews or information he or she deems necessary or warranted, and 
will promptly notify the unit whether he or she has approved the 
reapplication and recertified the unit.
    (2) In reviewing the reapplication, the Secretary will give special 
attention to whether the unit has used its resources effectively in 
investigating cases of possible fraud, in preparing cases for 
prosecution, and in prosecuting cases or cooperating with the 
prosecuting authorities.

(Approved by the Office of Management and Budget under control number 
0990-0162)



Sec.  1007.17  Annual report.

    At least 60 days prior to the expiration of the certification 
period, the unit will submit to the Secretary a report covering the last 
12 months (the first 9 months of the certification period for the first 
annual report), and containing the following information--
    (a) The number of investigations initiated and the number completed 
or closed, categorized by type of provider;
    (b) The number of cases prosecuted or referred for prosecution; the 
number of cases finally resolved and their outcomes; and the number of 
cases investigated but not prosecuted or referred for prosecution 
because of insufficient evidence;
    (c) The number of complaints received regarding abuse and neglect of 
patients in health care facilities; the number of such complaints 
investigated by the unit; and the number referred to other identified 
State agencies;
    (d) The number of recovery actions initiated by the unit; the number 
of recovery actions referred to another agency; the total amount of 
overpayments identified by the unit; and the total amount of 
overpayments actually collected by the unit;
    (e) The number of recovery actions initiated by the Medicaid agency 
under its agreement with the unit, and the total amount of overpayments 
actually collected by the Medicaid agency under this agreement;
    (f) Projections for the succeeding 12 months for items listed in 
paragraphs (a) through (e) of this section;
    (g) The costs incurred by the unit; and
    (h) A narrative that evaluates the unit's performance; describes any 
specific problems it has had in connection

[[Page 760]]

with the procedures and agreements required under this part; and 
discusses any other matters that have impaired its effectiveness.

(Approved by the Office of Management and Budget under control number 
0990-0162)



Sec.  1007.19  Federal financial participation (FFP).

    (a) Rate of FFP. Subject to the limitation of this section, the 
Secretary will reimburse each State by an amount equal to 90 percent of 
the costs incurred by a certified unit which are attributable to 
carrying out its functions and responsibilities under this part.
    (b) Retroactive certification. The Secretary may grant certification 
retroactive to the date on which the unit first met all the requirements 
of the statute and of this part. For any quarter with respect to which 
the unit is certified, the Secretary will provide reimbursement for the 
entire quarter.
    (c) Amount of FFP. FFP for any quarter will not exceed the higher of 
$125,000 or one-quarter of 1 percent of the sums expended by the 
Federal, State, and local governments during the previous quarter in 
carrying out the State Medicaid program.
    (d) Costs subject to FFP. (1) FFP is available under this part for 
the expenditures attributable to the establishment and operation of the 
unit, including the cost of training personnel employed by the unit. 
Reimbursement will be limited to costs attributable to the specific 
responsibilities and functions set forth in this part in connection with 
the investigation and prosecution of suspected fraudulent activities and 
the review of complaints of alleged abuse or neglect of patients in 
health care facilities.
    (2) (i) Establishment costs are limited to clearly identifiable 
costs of personnel that--
    (A) Devote full time to the establishment of the unit which does 
achieve certification; and
    (B) Continue as full-time employees after the unit is certified.
    (ii) All establishment costs will be deemed made in the first 
quarter of certification.
    (e) Costs not subject to FFP. FFP is not available under this part 
for expenditures attributable to--
    (1) The investigation of cases involving program abuse or other 
failures to comply with applicable laws and regulations, if these cases 
do not involve substantial allegations or other indications of fraud;
    (2) Efforts to identify situations in which a question of fraud may 
exist, including the screening of claims, analysis of patterns of 
practice, or routine verification with recipients of whether services 
billed by providers were actually received;
    (3) The routine notification of providers that fraudulent claims may 
be punished under Federal or State law;
    (4) The performance by a person other than a full-time employee of 
the unit of any management function for the unit, any audit or 
investigation, any professional legal function, or any criminal, civil 
or administrative prosecution of suspected providers;
    (5) The investigation or prosecution of cases of suspected recipient 
fraud not involving suspected conspiracy with a provider; or
    (6) Any payment, direct or indirect, from the unit to the Medicaid 
agency, other than payments for the salaries of employees on detail to 
the unit.



Sec.  1007.21  Other applicable HHS regulations.

    Except as otherwise provided in this part, the following regulations 
from 45 CFR subtitle A apply to grants under this part:
    Part 16, subpart C--Department Grant Appeals Process--Special 
Provisions Applicable to Reconsideration of Disallowances [Note that 
this applies only to disallowance determinations and not to any other 
determinations, e.g., over certification or recertification];
    Part 74--Administration of Grants;
    Part 75--Informal Grant Appeals Procedures;
    Part 80--Nondiscrimination Under Programs Receiving Federal 
Assistance Through the Department of Health and Human Services, 
Effectuation of title VI of the Civil Rights Act of 1964;

[[Page 761]]

    Part 81--Practice and Procedure for Hearings Under 45 CFR part 80;
    Part 84--Nondiscrimination on the Basis of Handicap in Programs and 
Activities Receiving or Benefiting From Federal Financial Assistance;
    Part 91--Nondiscrimination on the Basis of Age in HHS Programs or 
Activities Receiving Federal Financial Assistance.



PART 1008_ADVISORY OPINIONS BY THE OIG--Table of Contents




                      Subpart A_General Provisions

Sec.
1008.1 Basis and purpose.
1008.3 Effective period.
1008.5 Matters subject to advisory opinions.

Subpart B_Preliminary Obligations and Responsibilities of the Requesting 
                                  Party

1008.11 Who may submit a request.
1008.15 Facts subject to advisory opinions.
1008.18 Preliminary questions suggested for the requesting party.

                     Subpart C_Advisory Opinion Fees

1008.31 OIG fees for the cost of advisory opinions.
1008.33 Expert opinions from outside sources.

    Subpart D_Submission of a Formal Request for an Advisory Opinion

1008.36 Submission of a request.
1008.37 Disclosure of ownership and related information.
1008.38 Signed certifications by the requestor.
1008.39 Additional information.
1008.40 Withdrawal.

          Subpart E_Obligations and Responsibilities of the OIG

1008.41 OIG acceptance of the request.
1008.43 Issuance of a formal advisory opinion.
1008.45 Rescission, termination or modification.
1008.47 Disclosure.

           Subpart F_Scope and Effect of OIG Advisory Opinions

1008.51 Exclusivity of OIG advisory opinions.
1008.53 Affected parties.
1008.55 Admissibility of evidence.
1008.59 Range of the advisory opinion.

    Authority: 42 U.S.C. 1320a-7d(b).

    Source: 62 FR 7357, Feb. 19, 1997, unless otherwise noted.



                      Subpart A_General Provisions



Sec.  1008.1  Basis and purpose.

    (a) This part contains the specific procedures for the submission of 
requests by an individual or entity for advisory opinions to, and the 
issuance of advisory opinions by, the OIG, in consultation with the 
Department of Justice (DoJ), in accordance with section 1128D(b) of the 
Social Security Act (Act), 42 U.S.C. 1320a-7d(b). The OIG will issue 
such advisory opinions based on actual or proposed factual circumstances 
submitted by the requesting individual or entity, or by counsel on 
behalf of the requesting individual or entity, provided all other 
requirements of this part are satisfied (including the requirement that 
the requesting individual or entity provide the certifications required 
in accordance with Sec.  1008.38 of this part).
    (b) An individual or entity may request an advisory opinion from the 
OIG regarding any of five specific subject matters described in Sec.  
1008.5 of this part.
    (c) The requesting party must provide a complete description of the 
facts as set forth in subpart B of this part, and pay the costs to the 
OIG of processing the request for an advisory opinion as set forth in 
subpart C of this part.
    (d) Nothing in this part limits the investigatory or prosecutorial 
authority of the OIG, DoJ or any other agency of the Government.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38324, July 16, 1998]



Sec.  1008.3  Effective period.

    The provisions in this part are applicable to requests for advisory 
opinions submitted on or after February 21, 1997, and before August 21, 
2000, and to any requests submitted during any other time period for 
which the OIG is required by law to issue advisory opinions.

[[Page 762]]



Sec.  1008.5  Matters subject to advisory opinions.

    (a) An individual or entity may request an advisory opinion from the 
OIG regarding--
    (1) What constitutes prohibited remuneration within the meaning of 
section 1128B(b) of the Act;
    (2) Whether an arrangement, or proposed arrangement, satisfies the 
criteria set forth in section 1128B(b)(3) of the Act for activities that 
do not result in prohibited remuneration;
    (3) Whether an arrangement, or proposed arrangement, satisfies the 
criteria set forth in Sec.  1001.952 of this chapter for activities that 
do not result in prohibited remuneration;
    (4) What constitutes an inducement to reduce or limit services under 
section 1128A(b) of the Act to Medicare or Medicaid program 
beneficiaries; and
    (5) Whether any activity, or proposed activity, constitutes grounds 
for the imposition of a sanction under sections 1128, 1128A or 1128B of 
the Act.
    (b) Exceptions. The OIG will not address through the advisory 
opinion process--
    (1) What the fair market value will be, or whether fair market value 
was paid or received, for any goods, services or property; or
    (2) Whether an individual is a bona fide employee within the 
requirements of section 3121(d)(2) of the Internal Revenue Code of 1986.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38324, July 16, 1998]



Subpart B_Preliminary Obligations and Responsibilities of the Requesting 
                                  Party



Sec.  1008.11  Who may submit a request.

    Any individual or entity may submit a request to the OIG for an 
advisory opinion regarding an existing arrangement or one which the 
requestor in good faith specifically plans to undertake. The requestor 
must be a party to the arrangement, or proposed arrangement, that is the 
subject of the request.



Sec.  1008.15  Facts subject to advisory opinions.

    (a) The OIG will consider requests from a requesting party for 
advisory opinions regarding the application of specific facts to the 
subject matters set forth in Sec.  1008.5(a) of this part. The facts 
must relate to an existing arrangement, or one which the requestor in 
good faith plans to undertake. The plans may be contingent upon 
receiving a favorable advisory opinion. The advisory opinion request 
should contain a complete description of the arrangement that the 
requestor is undertaking, or plans to undertake.
    (b) Requests presenting a general question of interpretation, posing 
a hypothetical situation, or regarding the activities of third parties 
do not qualify as advisory opinion requests.
    (c) Advisory opinion request will not be accepted, and/or opinions 
will not be issued when--
    (1) The request is not related to a named individual or entity;
    (2) The same, or substantially the same, course of action is under 
investigation, or is or has been the subject of a proceeding involving 
the Department of Health and Human Services or another governmental 
agency; or
    (3) An informed opinion cannot be made, or could be made only after 
extensive investigation, clinical study, testing, or collateral inquiry.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38324, July 16, 1998]



Sec.  1008.18  Preliminary questions suggested for the requesting party.

    (a) The OIG may establish and maintain a set of questions 
corresponding to the categories of opinion subject matter as set forth 
in Sec.  1008.5(a) of this part as appropriate. The questions will be 
designed to elicit specific information relevant to the advisory opinion 
being sought; however, answering the questions is voluntary.
    (b) Questions the OIG suggests that the requestor address may be 
obtained from the OIG. Requests should be made in writing, specify the 
subject matter, and be sent to the headquarter offices of the OIG.
    (c) When submitting a request for an advisory opinion, a requestor 
may answer the questions corresponding to

[[Page 763]]

the subject matter for which the opinion is requested. The extent to 
which any of the questions is not fully answered may effect the content 
of the advisory opinion.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38324, July 16, 1998]



                     Subpart C_Advisory Opinion Fees



Sec.  1008.31  OIG fees for the cost of advisory opinions.

    (a) Responsibility for fees. The requestor is responsible for paying 
a fee equal to the costs incurred by the Department in responding to the 
request for an advisory opinion.
    (b) Payment Method. Payment for a request for an advisory opinion 
must be made to the Treasury of the United States, as directed by OIG.
    (c) Calculation of costs: Prior to the issuance of the advisory 
opinion, the OIG will calculate the costs incurred by the Department in 
responding to the request. The calculation will include the costs of 
salaries and benefits payable to attorneys and others who have worked on 
the request in question, as well as administrative and supervisory 
support for such person. The OIG has the exclusive authority to 
determine the cost of responding to a request for an advisory opinion 
and such determination is not reviewable or waiveable.
    (d) Agreement to pay all costs. (1) By submitting the request for an 
advisory opinion, the requestor agrees, except as indicated in paragraph 
(d)(4) of this section, to pay all costs incurred by the OIG in 
responding to the request for an advisory opinion.
    (2) In its request for an advisory opinion, the requestor may 
request a written estimate of the cost involved in processing the 
advisory opinion. Within 10 business days of receipt of the request, the 
OIG will notify in writing of such estimate. Such estimate will not be 
binding on the Department, and the actual cost to be paid may be higher 
or lower than estimated. The time period for issuing the advisory 
opinion will be tolled from the time the OIG notifies the requestor of 
the estimate until the OIG receives written confirmation from the 
requestor that the requestor wants the OIG to continue processing the 
request. Such notice may include a new or revised triggering dollar 
amount, as set forth in paragraph (d)(3) of this section.
    (3) In its request for an advisory opinion, the requestor may 
designate a triggering dollar amount. If the OIG estimates that the 
costs of processing the advisory opinion request have reached, or are 
likely to exceed, the designated triggering dollar amount, the OIG will 
notify the requestor. The requestor may revise its designated triggering 
dollar amount in writing in its response to notification of a cost 
estimate in accordance with paragraph (d)(2) of this section.
    (4) If the OIG notifies the requestor that the estimated cost of 
processing the request has reached or is likely to exceed the triggering 
dollar amount, the OIG will stop processing the request until such time 
as the requestor makes a written request for the OIG to continue 
processing the request. Any delay in the processing of the request for 
an advisory opinion attributable to these procedures will toll the time 
for issuance of an advisory opinion until the requestor asks the OIG to 
continue working on the request.
    (5) If the requestor chooses not to pay for completion of an 
advisory opinion, or withdraws the request, the requestor is still 
obligated to pay for all costs incurred and identified by the OIG 
attributable to processing the request for an advisory opinion up to 
that point.
    (6) If the costs incurred by the OIG in responding to the request 
are greater than the amount paid by the requestor, the OIG will, prior 
to the issuance of the advisory opinion, notify the requestor of any 
additional amount due. The OIG will not issue an advisory opinion until 
the full amount owed by the requestor has been paid. Once the requestor 
has paid the OIG the total amount due for the costs of processing the 
request, the OIG will issue the advisory opinion. The time period for 
issuing advisory opinions will be tolled from the time the OIG notifies 
the requestor of the amount owed until the time full payment is 
received.
    (e) Fees for outside experts. (1) In addition to the fees identified 
in this section, the requestor also must pay any

[[Page 764]]

required fees for expert opinions, if any, from outside sources, as 
described in Sec.  1008.33.
    (2) If the OIG determines that it is necessary to obtain expert 
advice to issue a requested advisory opinion, the OIG will notify the 
requestor of that fact and provide the identity of the appropriate 
expert and an estimate of the costs of the expert advice.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38324, July 16, 1998; 73 
FR 15939, Mar. 26, 2008]



Sec.  1008.33  Expert opinions from outside sources.

    (a) The OIG may request expert advice from qualified sources on non-
legal issues if necessary to respond to the advisory opinion request. 
For example, the OIG may require the use of appropriate medical 
reviewers, such as quality improvement organizations, to obtain medical 
opinions on specific issues.
    (b) The time period for issuing an advisory opinion will be tolled 
from the time that the OIG notifies the requestor of the need for an 
outside expert opinion until the time the OIG receives the necessary 
expert opinion.
    (c) Once payment is made for the cost of the expert opinion, as set 
forth in Sec.  1008.31(e) of this part, either directly to the expert or 
otherwise, the OIG will arrange for a prompt expert review of the issue 
or issues in question. Regardless of the manner of payment, the expert's 
work and opinion will be subject to the sole direction of the OIG.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38325, July 16, 1998]



    Subpart D_Submission of a Formal Request for an Advisory Opinion



Sec.  1008.36  Submission of a request.

    (a) A request for a formal advisory opinion must be submitted in 
writing. An original and 2 copies of the request should be addressed to 
the headquarter offices of the OIG.
    (b) Each request for an advisory opinion must include--
    (1) To the extent known to the requestor, the identities, including 
the names and addresses, of the requestor and of all other actual and 
potential parties to the arrangement, that are the subject of the 
request for an advisory opinion;
    (2) The name, title, address, and daytime telephone number of a 
contact person who will be available to discuss the request for an 
advisory opinion with the OIG on behalf of the requestor;
    (3) A declaration of the subject category or categories as described 
in Sec.  1008.5 of this part for which the advisory opinion is 
requested. To the extent an individual or entity requests an advisory 
opinion in accordance with Sec. Sec.  1008.5(a)(3) or (a)(5) of this 
part, the requesting individual or entity should identify the specific 
subsections of sections 1128, 1128A or 1128B of the Act or the specific 
provision of Sec.  1001.952 of this chapter about which an advisory 
opinion is sought:
    (4) A complete and specific description of all relevant information 
bearing on the arrangement for which an advisory opinion is requested 
and on the circumstances of the conduct, \1\ including--
---------------------------------------------------------------------------

    \1\ The requestor is under an affirmative obligation to make full 
and true disclosure with respect to the facts regarding the advisory 
opinion being requested.
---------------------------------------------------------------------------

    (i) Background information,
    (ii) For existing arrangements, complete copies of all operative 
documents,
    (iii) For proposed arrangements, complete copies of all operative 
documents, if possible, and otherwise descriptions of proposed terms, 
drafts, or models of documents sufficient to permit the OIG to render an 
informed opinion,
    (iv) Detailed statements of all collateral or oral understandings, 
if any, and
    (v) If applicable, a designation of trade secrets or confidential 
commercial or financial information in the manner described in 45 CFR 
5.65;
    (5) Signed certifications by the requestor(s), as described in Sec.  
1008.37 of this part;
    (6) A declaration regarding whether an advisory opinion in 
accordance with part 411 of this title has been or will be requested 
from CMS about the arrangement that is the subject of the advisory 
opinion request; and

[[Page 765]]

    (7) Each requesting party's Taxpayer Identification Number.

(Approved by the Office of Management and Budget under control number 
0990-0213)

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38325, July 16, 1998; 73 
FR 15939, Mar. 26, 2008]



Sec.  1008.37  Disclosure of ownership and related information.

    Each individual or entity requesting an advisory opinion must supply 
full and complete information as to the identity of each entity owned or 
controlled by the individual or entity, and of each person with an 
ownership or control interest in the entity, as defined in section 
1124(a)(1) of the Social Security Act (42 U.S.C. 1320a-3(a)(1)) and part 
420 of this chapter.

(Approved by the Office of Management and Budget under control number 
0990-0213)

[67 FR 11936, Mar. 18, 2002]



Sec.  1008.38  Signed certifications by the requestor.

    (a) Every request must include the following signed certification 
from all requestors: ``With knowledge of the penalties for false 
statements provided by 18 U.S.C. 1001 and with knowledge that this 
request for an advisory opinion is being submitted to the Department of 
Health and Human Services, I certify that all of the information 
provided is true and correct, and constitutes a complete description of 
the facts regarding which an advisory opinion is sought, to the best of 
my knowledge and belief.''
    (b) If the advisory opinion relates to a proposed arrangement, the 
request must also include the following signed certification from all 
requestors: ``The arrangement described in this request for an advisory 
opinion is one that [the requestor(s)] in good faith plan(s) to 
undertake.'' This statement may be made contingent on a favorable OIG 
advisory opinion, in which case, the phrase ``if the OIG issues a 
favorable advisory opinion'' should be added to the certification.
    (c) The certification(s) must be signed by--
    (1) The requestor, if the requestor is an individual;
    (2) The chief executive officer, or comparable officer, of the 
requestor, if the requestor is a corporation;
    (3) The managing partner of the requestor, if the requestor is a 
partnership; or
    (4) The managing member, or comparable person, if the requestor is a 
limited liability company.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38325, July 16, 1998]



Sec.  1008.39  Additional information.

    (a) If the request for an advisory opinion does not contain all of 
the information required by Sec.  1008.36 of this part, or the OIG 
believes it needs more information prior to rendering an advisory 
opinion, the OIG may, at any time, request whatever additional 
information or documents it deems necessary. The time period for the 
issuance of an advisory opinion will be tolled from the time the OIG 
requests the additional information from the requestor until such time 
as the OIG determines that it has received the requested information.
    (b) The OIG may request additional information before or after the 
request for an advisory opinion has been accepted.
    (c) Additional information should be provided in writing and 
certified to be a true, correct and complete disclosure of the requested 
information in a manner equivalent to that described in Sec.  1008.38 of 
this part.
    (d) In connection with any request for an advisory opinion, the OIG 
or DoJ may conduct whatever independent investigation they believe 
appropriate.
    (e) Requesting parties are required to notify the OIG if they 
request an advisory opinion in accordance with part 411 of this title 
from CMS about the arrangement that is the subject of their advisory 
opinion request.
    (f) Where appropriate, after receipt of an advisory opinion request, 
the OIG may consult with the requesting parties to the extent the OIG 
deems necessary.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38325, July 16, 1998]

[[Page 766]]



Sec.  1008.40  Withdrawal.

    The requestor of an advisory opinion may withdraw the request prior 
to the issuance of a formal advisory opinion by the OIG. The withdrawal 
must be written and must be submitted to the same address as the 
submitted request, as indicated in Sec. Sec.  1008.18(b) and 1008.36(a) 
of this part. Regardless of whether the request is withdrawn, the 
requestor must pay the costs expended by the OIG in processing the 
opinion, as discussed in Sec.  1008.31(d) of this part. The OIG reserves 
the right to retain any request for an advisory opinion, documents and 
information submitted to it under these procedures, and to use them for 
any governmental purposes.



          Subpart E_Obligations and Responsibilities of the OIG



Sec.  1008.41  OIG acceptance of the request.

    (a) Upon receipt of a request for an advisory opinion, the OIG will 
promptly make an initial determination whether the submission includes 
all of the information the OIG will require to process the request.
    (b) Within 10 working days of receipt of the request, the OIG will--
    (1) Formally accept the request for an advisory opinion,
    (2) Notify the requestor of what additional information is needed, 
or
    (3) Formally decline to accept the request.
    (c) If the requestor provides the additional information requested, 
or otherwise resubmits the request, the OIG will process the 
resubmission in accordance with paragraphs (a) and (b) of this section 
as if it was an initial request for an advisory opinion.
    (d) Upon acceptance of the request, the OIG will notify the 
requestor by regular U.S. mail of the date that the request for the 
advisory opinion was formally accepted.
    (e) The 60-day period for issuance of an advisory opinion set forth 
in Sec.  1008.43(c) of this part will not commence until the OIG has 
formally accepted the request for an advisory opinion.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38326, July 16, 1998]



Sec.  1008.43  Issuance of a formal advisory opinion.

    (a) An advisory opinion will be considered issued once payment is 
received and it is dated, numbered, and signed by an authorized official 
of the OIG.
    (b) An advisory opinion will contain a description of the material 
facts provided to the OIG with regard to the arrangement for which an 
advisory opinion has been requested. The advisory opinion will state the 
OIG's opinion regarding the subject matter of the request based on the 
facts provided to the OIG. If necessary, to fully describe the 
arrangement, the OIG is authorized to include in the advisory opinion 
the material facts of the arrangement, notwithstanding that some of 
these facts could be considered confidential information or trade 
secrets within the meaning of 18 U.S.C. 1905.
    (c)(1) The OIG will issue an advisory opinion, in accordance with 
the provisions of this part, within 60 days after the request for an 
advisory opinion has been formally accepted;
    (2) If the 60th day falls on a Saturday, Sunday, or Federal holiday, 
the time period will end at the close of the next business day following 
the weekend or holiday;
    (3) The 60 day period will be tolled from the time the OIG--
    (i) Notifies the requestor that the costs have reached, or are 
likely to exceed, the triggering amount until the time when the OIG 
receives written notice from the requestor to continue processing the 
request;
    (ii) Requests additional information from the requestor until the 
time the OIG receives the requested information;
    (iii) Notifies the requestor of the full amount due until the time 
the OIG receives payment of the full amount owed; and
    (iv) Notifies the requestor of the need for expert advice until the 
time the OIG receives the expert advice.
    (d) After OIG has notified the requestor of the full amount owed and 
OIG has determined that the full payment of that amount has been 
properly paid by the requestor, OIG will issue the advisory opinion and 
promptly

[[Page 767]]

mail it to the requestor by regular first class U.S. mail.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38326, July 16, 1998; 73 
FR 15939, Mar. 26, 2008]



Sec.  1008.45  Rescission, termination or modification.

    (a) Any advisory opinion given by the OIG is without prejudice to 
the right of the OIG to reconsider the questions involved and, where the 
public interest requires, to rescind, terminate or modify the advisory 
opinion. Requestors will be given a preliminary notice of the OIG's 
intent to rescind, terminate or modify the opinion, and will be provided 
a reasonable opportunity to respond. A final notice of rescission, 
termination or modification will be given to the requestor so that the 
individual or entity may discontinue or modify, as the case may be, the 
course of action taken in accordance with the OIG advisory opinion.
    (b) For purposes of this part--
    (1) To rescind an advisory opinion means that the advisory opinion 
is revoked retroactively to the original date of issuance with the 
result that the advisory opinion will be deemed to have been without 
force and effect from the original date of issuance. Recission may occur 
only where relevant and material facts were not fully, completely and 
accurately disclosed to the OIG.
    (2) To terminate an advisory opinion means that the advisory opinion 
is revoked as of the termination date and is no longer in force and 
effect after the termination date. The OIG will not proceed against the 
requestor under this part if such action was promptly, diligently, and 
in good faith discontinued in accordance with reasonable time frames 
established by the OIG after consultation with the requestor.
    (3) To modify an advisory opinion means that the advisory opinion is 
amended, altered, or limited, and that the advisory opinion continues in 
full force and effect in modified form thereafter. The OIG will not 
proceed against the requestor under this part if such action was 
promptly, diligently, and in good faith modified in accordance with 
reasonable time frames established by the OIG after consultation with 
the requestor.

[63 FR 38326, July 16, 1998]



Sec.  1008.47  Disclosure.

    (a) Advisory opinions issued and released in accordance with the 
provisions set forth in this part will be available to the public.
    (b) Promptly after the issuance and release of an advisory opinion 
to the requestor, a copy of the advisory opinion will be available for 
public inspection between the hours of 10:00 a.m. and 3:00 p.m. on 
normal business days at the headquarter offices of the OIG and on the 
DHHS/OIG web site.
    (c) Any pre-decisional document, or part of such pre-decisional 
document, that is prepared by the OIG, DoJ, or any other Department or 
agency of the United States in connection with an advisory opinion 
request under the procedures set forth in this part generally will be 
exempt from disclosure under 5 U.S.C. 552, and will not be made publicly 
available.
    (d) Documents submitted by the requestor to the OIG in connection 
with a request for an advisory opinion may be available to the public in 
accordance with 5 U.S.C. 552 through procedures set forth in 45 CFR part 
5.
    (e) Nothing in this section will limit the OIG's right, in its 
discretion, to issue a press release or otherwise publicly disclose the 
identity of the requesting party or parties, and the nature of the 
action taken by the OIG upon the request.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38326, July 16, 1998]



           Subpart F_Scope and Effect of OIG Advisory Opinions



Sec.  1008.51  Exclusivity of OIG advisory opinions.

    The only method for obtaining a binding advisory opinion regarding 
any of the subject matters set forth in Sec.  1008.5(a) is through the 
procedures described in this part. No binding advisory opinion, oral or 
written, has or may be issued by the OIG regarding the specific matters 
set forth in Sec.  1008.5(a) except through written opinions issued in 
accordance with this part.

[[Page 768]]



Sec.  1008.53  Affected parties.

    An advisory opinion issued by the OIG will have no application to 
any individual or entity that does not join in the request for the 
opinion. No individual or entity other than the requestor(s) may rely on 
an advisory opinion.



Sec.  1008.55  Admissibility of evidence.

    (a) The failure of a party to seek an advisory opinion may not be 
introduced into evidence to prove that the party intended to violate the 
provisions of sections 1128, 1128A or 1128B of the Act.
    (b) An advisory opinion may not be introduced into evidence by a 
person or entity that was not the requestor of the advisory opinion to 
prove that the person or entity did not violate the provisions of 
sections 1128, 1128A or 1128B of the Act or any other law.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38326, July 16, 1998]



Sec.  1008.59  Range of the advisory opinion.

    (a) An advisory opinion will state only the OIG's opinion regarding 
the subject matter of the request. If the arrangement for which an 
advisory opinion is requested is subject to approval or regulation by 
any other Federal, State or local government agency, such advisory 
opinion may not be taken to indicate the OIG's views on the legal or 
factual issues that may be raised before that agency. The OIG will not 
provide any legal opinion on questions or issues regarding an authority 
which is vested in other Federal, State or local government agencies.
    (b) An advisory opinion issued under this part will not bind or 
obligate any agency other than the Department. It will not affect the 
requestor's, or anyone else's, obligations to any other agency, or under 
any statutory or regulatory provision other than that which is the 
specific subject matter of the advisory opinion.

[62 FR 7357, Feb. 19, 1997, as amended at 63 FR 38326, July 16, 1998]

[[Page 769]]



                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.

  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  Table of OMB Control Numbers
  List of CFR Sections Affected

[[Page 771]]



                    Table of CFR Titles and Chapters




                     (Revised as of October 1, 2009)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                    Title 2--Grants and Agreements

            Subtitle A--Office of Management and Budget Guidance 
                for Grants and Agreements
         I  Office of Management and Budget Governmentwide 
                Guidance for Grants and Agreements (Parts 100--
                199)
        II  Office of Management and Budget Circulars and Guidance 
                (200--299)
            Subtitle B--Federal Agency Regulations for Grants and 
                Agreements
       III  Department of Health and Human Services (Parts 300-- 
                399)
        VI  Department of State (Parts 600--699)
      VIII  Department of Veterans Affairs (Parts 800--899)
        IX  Department of Energy (Parts 900--999)
        XI  Department of Defense (Parts 1100--1199)
       XII  Department of Transportation (Parts 1200--1299)
      XIII  Department of Commerce (Parts 1300--1399)
       XIV  Department of the Interior (Parts 1400--1499)
        XV  Environmental Protection Agency (Parts 1500--1599)
     XVIII  National Aeronautics and Space Administration (Parts 
                1880--1899)
      XXII  Corporation for National and Community Service (Parts 
                2200--2299)
     XXIII  Social Security Administration (Parts 2300--2399)
      XXIV  Housing and Urban Development (Parts 2400--2499)
       XXV  National Science Foundation (Parts 2500--2599)
      XXVI  National Archives and Records Administration (Parts 
                2600--2699)
     XXVII  Small Business Administration (Parts 2700--2799)
    XXVIII  Department of Justice (Parts 2800--2899)
       XXX  Department of Homeland Security (Parts 3000--3099)
      XXXI  Institute of Museum and Library Services (Parts 3100--
                3199)
     XXXII  National Endowment for the Arts (Parts 3200--3299)
    XXXIII  National Endowment for the Humanities (Parts 3300--
                3399)

[[Page 772]]

      XXXV  Export-Import Bank of the United States (Parts 3500--
                3599)
    XXXVII  Peace Corps (Parts 3700--3799)

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  Government Accountability Office (Parts 1--99)
        II  Recovery Accountability and Transparency Board (Parts 
                200--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Parts 2100--2199)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Parts 3200--
                3299)
     XXIII  Department of Energy (Parts 3300--3399)
      XXIV  Federal Energy Regulatory Commission (Parts 3400--
                3499)
       XXV  Department of the Interior (Parts 3500--3599)
      XXVI  Department of Defense (Parts 3600-- 3699)
    XXVIII  Department of Justice (Parts 3800--3899)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Parts 4300--
                4399)
      XXXV  Office of Personnel Management (Parts 4500--4599)
        XL  Interstate Commerce Commission (Parts 5000--5099)
       XLI  Commodity Futures Trading Commission (Parts 5100--
                5199)
      XLII  Department of Labor (Parts 5200--5299)
     XLIII  National Science Foundation (Parts 5300--5399)

[[Page 773]]

       XLV  Department of Health and Human Services (Parts 5500--
                5599)
      XLVI  Postal Rate Commission (Parts 5600--5699)
     XLVII  Federal Trade Commission (Parts 5700--5799)
    XLVIII  Nuclear Regulatory Commission (Parts 5800--5899)
         L  Department of Transportation (Parts 6000--6099)
       LII  Export-Import Bank of the United States (Parts 6200--
                6299)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Parts 6400--6499)
        LV  National Endowment for the Arts (Parts 6500--6599)
       LVI  National Endowment for the Humanities (Parts 6600--
                6699)
      LVII  General Services Administration (Parts 6700--6799)
     LVIII  Board of Governors of the Federal Reserve System 
                (Parts 6800--6899)
       LIX  National Aeronautics and Space Administration (Parts 
                6900--6999)
        LX  United States Postal Service (Parts 7000--7099)
       LXI  National Labor Relations Board (Parts 7100--7199)
      LXII  Equal Employment Opportunity Commission (Parts 7200--
                7299)
     LXIII  Inter-American Foundation (Parts 7300--7399)
      LXIV  Merit Systems Protection Board (Parts 7400--7499)
       LXV  Department of Housing and Urban Development (Parts 
                7500--7599)
      LXVI  National Archives and Records Administration (Parts 
                7600--7699)
     LXVII  Institute of Museum and Library Services (Parts 7700--
                7799)
    LXVIII  Commission on Civil Rights (Parts 7800--7899)
      LXIX  Tennessee Valley Authority (Parts 7900--7999)
      LXXI  Consumer Product Safety Commission (Parts 8100--8199)
    LXXIII  Department of Agriculture (Parts 8300--8399)
     LXXIV  Federal Mine Safety and Health Review Commission 
                (Parts 8400--8499)
     LXXVI  Federal Retirement Thrift Investment Board (Parts 
                8600--8699)
    LXXVII  Office of Management and Budget (Parts 8700--8799)
     XCVII  Department of Homeland Security Human Resources 
                Management System (Department of Homeland 
                Security--Office of Personnel Management) (Parts 
                9700--9799)
      XCIX  Department of Defense Human Resources Management and 
                Labor Relations Systems (Department of Defense--
                Office of Personnel Management) (Parts 9900--9999)

                      Title 6--Domestic Security

         I  Department of Homeland Security, Office of the 
                Secretary (Parts 0--99)

[[Page 774]]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
        XX  Local Television Loan Guarantee Board (Parts 2200--
                2299)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy Policy and New Uses, Department of 
                Agriculture (Parts 2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)

[[Page 775]]

      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)
         L  Rural Business-Cooperative Service, Rurual Housing 
                Service, and Rural Utilities Service, Department 
                of Agriculture (Parts 5000--5099)

                    Title 8--Aliens and Nationality

         I  Department of Homeland Security (Immigration and 
                Naturalization) (Parts 1--499)
         V  Executive Office for Immigration Review, Department of 
                Justice (Parts 1000--1399)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Department of 
                Agriculture (Parts 300--599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
      XIII  Nuclear Waste Technical Review Board (Parts 1303--
                1399)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

[[Page 776]]

     XVIII  Northeast Interstate Low-Level Radioactive Waste 
                Commission (Parts 1800--1899)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)
        II  Election Assistance Commission (Parts9400--9499)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)
      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XII  Federal Housing Finance Agency (Parts 1200--1299)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Department of the Treasury (Parts 1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700--1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)
        IV  Emergency Steel Guarantee Loan Board (Parts 400--499)
         V  Emergency Oil and Gas Guaranteed Loan Board (Parts 
                500--599)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)

[[Page 777]]

         V  National Aeronautics and Space Administration (Parts 
                1200--1299)
        VI  Air Transportation System Stabilization (Parts 1300--
                1399)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Industry and Security, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)
            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

[[Page 778]]

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  Bureau of Customs and Border Protection, Department of 
                Homeland Security; Department of the Treasury 
                (Parts 0--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Bureau of Immigration and Customs Enforcement, 
                Department of Homeland Security (Parts 400--599)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)
        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training Service, Department of 
                Labor (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development (Parts 200--299)
       III  Peace Corps (Parts 300--399)

[[Page 779]]

        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  Broadcasting Board of Governors (Parts 500--599)
       VII  Overseas Private Investment Corporation (Parts 700--
                799)
        IX  Foreign Service Grievance Board (Parts 900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Millenium Challenge Corporation (Parts 1300--1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                HousingCommissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
        IV  Office of Housing and Office of Multifamily Housing 
                Assistance Restructuring, Department of Housing 
                and Urban Development (Parts 400--499)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)

[[Page 780]]

        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--1699)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Parts 1000--1199)
       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Parts 1200--1299)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--899)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Alcohol and Tobacco Tax and Trade Bureau, Department 
                of the Treasury (Parts 1--399)

[[Page 781]]

        II  Bureau of Alcohol, Tobacco, Firearms, and Explosives, 
                Department of Justice (Parts 400--699)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--299)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)
      VIII  Court Services and Offender Supervision Agency for the 
                District of Columbia (Parts 800--899)
        IX  National Crime Prevention and Privacy Compact Council 
                (Parts 900--999)
        XI  Department of Justice and Department of State (Parts 
                1100--1199)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Employee Benefits Security Administration, Department 
                of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

[[Page 782]]

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)
        IX  Federal Claims Collection Standards (Department of the 
                Treasury--Department of Justice) (Parts 900--999)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
      XVII  Office of the Director of National Intelligence (Parts 
                1700--1799)
     XVIII  National Counterintelligence Center (Parts 1800--1899)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)

[[Page 783]]

    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Homeland Security (Parts 
                1--199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvmeent, 
                Department of Education [Reserved]
        XI  National Institute for Literacy (Parts 1100--1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                          Title 35 [Reserved]

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
        VI  [Reserved]
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
         X  Presidio Trust (Parts 1000--1099)

[[Page 784]]

        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
        XV  Oklahoma City National Memorial Trust (Parts 1500--
                1599)
       XVI  Morris K. Udall Scholarship and Excellence in National 
                Environmental Policy Foundation (Parts 1600--1699)

             Title 37--Patents, Trademarks, and Copyrights

         I  United States Patent and Trademark Office, Department 
                of Commerce (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
       III  Copyright Royalty Board, Library of Congress (Parts 
                301--399)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Regulatory Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--1099)
        IV  Environmental Protection Agency and Department of 
                Justice (Parts 1400--1499)
         V  Council on Environmental Quality (Parts 1500--1599)
        VI  Chemical Safety and Hazard Investigation Board (Parts 
                1600--1699)
       VII  Environmental Protection Agency and Department of 
                Defense; Uniform National Discharge Standards for 
                Vessels of the Armed Forces (Parts 1700--1799)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans' 
                Employment and Training Service, Department of 
                Labor (Parts 61-1--61-999)

[[Page 785]]

            Chapters 62--100 [Reserved]
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       102  Federal Management Regulation (Parts 102-1--102-299)
            Chapters 103--104 [Reserved]
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Chapters 129--200 [Reserved]
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System [Reserved]
            Subtitle F--Federal Travel Regulation System
       300  General (Parts 300-1--300-99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)
       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Part 303-1--303-99)
       304  Payment of Travel Expenses from a Non-Federal Source 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Centers for Medicare & Medicaid Services, Department 
                of Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10010)

[[Page 786]]

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency, Department of 
                Homeland Security (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899) 
                [Reserved]
         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Homeland Security (Parts 
                1--199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)

[[Page 787]]

       III  Coast Guard (Great Lakes Pilotage), Department of 
                Homeland Security (Parts 400--499)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)
        IV  National Telecommunications and Information 
                Administration, Department of Commerce, and 
                National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 400--499)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Defense Acquisition Regulations System, Department of 
                Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  Agency for International Development (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)
        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management, Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  Broadcasting Board of Governors (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)

[[Page 788]]

        29  Department of Labor (Parts 2900--2999)
        30  Department of Homeland Security, Homeland Security 
                Acquisition Regulation (HSAR) (Parts 3000--3099)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement [Reserved]
        54  Defense Logistics Agency, Department of Defense (Parts 
                5400--5499)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Pipeline and Hazardous Materials Safety 
                Administration, Department of Transportation 
                (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)
       III  Federal Motor Carrier Safety Administration, 
                Department of Transportation (Parts 300--399)
        IV  Coast Guard, Department of Homeland Security (Parts 
                400--499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)
        XI  Research and Innovative Technology Administration, 
                Department of Transportation [Reserved]
       XII  Transportation Security Administration, Department of 
                Homeland Security (Parts 1500--1699)

[[Page 789]]

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR

[[Page 791]]





           Alphabetical List of Agencies Appearing in the CFR




                     (Revised as of October 1, 2009)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development              22, II
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department                            5, LXXIII
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               2, IX; 7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Nutrition Service                      7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Procurement and Property Management, Office of  7, XXXII
  Rural Business-Cooperative Service              7, XVIII, XLII, L
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV, L
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII, L
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Air Transportation Stabilization Board            14, VI
Alcohol and Tobacco Tax and Trade Bureau          27, I
Alcohol, Tobacco, Firearms, and Explosives,       27, II
     Bureau of
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX

[[Page 792]]

Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Broadcasting Board of Governors                   22, V
  Federal Acquisition Regulation                  48, 19
Census Bureau                                     15, I
Centers for Medicare & Medicaid Services          42, IV
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Civil Rights, Commission on                       5, LXVIII; 45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
Commerce Department                               44, IV
  Census Bureau                                   15, I
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  Industry and Security, Bureau of                15, VII
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV, VI
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office, United States      37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Copyright Royalty Board                           37, III
Corporation for National and Community Service    2, XXII; 45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Court Services and Offender Supervision Agency    28, VIII
     for the District of Columbia
Customs and Border Protection Bureau              19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A; 
                                                  40, VII

[[Page 793]]

  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII
  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Acquisition Regulations System          48, 2
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Human Resources Management and Labor Relations  5, XCIX
       Systems
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 2, XI; 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
District of Columbia, Court Services and          28, VIII
     Offender Supervision Agency for the
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Election Assistance Commission                    11, II
Elementary and Secondary Education, Office of     34, II
Emergency Oil and Gas Guaranteed Loan Board       13, V
Emergency Steel Guarantee Loan Board              13, IV
Employee Benefits Security Administration         29, XXV
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Environmental Protection Agency                   2, XV; 5, LIV; 40, I, IV, 
                                                  VII
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                5, III, LXXVII; 14, VI; 
                                                  48, 99

[[Page 794]]

  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export-Import Bank of the United States           2, XXXV; 5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV
Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               31, IX
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Agency                    12, XII
Federal Housing Finance Board                     12, IX
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Management Regulation                     41, 102
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Motor Carrier Safety Administration       49, III
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Nutrition Service                        7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II

[[Page 795]]

General Services Administration                   5, LVII; 41, 105
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Management Regulation                   41, 102
  Federal Property Management Regulations         41, 101
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Temporary Duty (TDY) Travel Allowances          41, 301
Geological Survey                                 30, IV
Government Accountability Office                  4, I
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          2, III; 5, XLV; 45, 
                                                  Subtitle A,
  Centers for Medicare & Medicaid Services        42, IV
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Homeland Security, Department of                  2, XXX; 6, I
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Customs and Border Protection Bureau            19, I
  Federal Emergency Management Agency             44, I
  Human Resources Management and Labor Relations  5, XCVII
       Systems
  Immigration and Customs Enforcement Bureau      19, IV
  Immigration and Naturalization                  8, I
  Transportation Security Administration          49, XII
HOPE for Homeowners Program, Board of Directors   24, XXIV
     of
Housing and Urban Development, Department of      2, XXIV; 5, LXV; 24, 
                                                  Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Housing, Office of, and Multifamily Housing     24, IV
       Assistance Restructuring, Office of
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Housing, Office of, and Multifamily Housing       24, IV
     Assistance Restructuring, Office of
Human Development Services, Office of             45, XIII
Immigration and Customs Enforcement Bureau        19, IV
Immigration and Naturalization                    8, I
Immigration Review, Executive Office for          8, V
Independent Counsel, Office of                    28, VII

[[Page 796]]

Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Industry and Security, Bureau of                  15, VII
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            2, XIV; 43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
International Fishing and Related Activities      50, III
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
Investment Security, Office of                    31, VIII
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                2, XXVII; 5, XXVIII; 28, 
                                                  I, XI; 40, IV
  Alcohol, Tobacco, Firearms, and Explosives,     27, II
       Bureau of
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             31, IX
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration Review, Executive Office for        8, V
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employee Benefits Security Administration       29, XXV
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V

[[Page 797]]

  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training Service,      41, 61; 20, IX
       Office of the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
  Copyright Royalty Board                         37, III
Local Television Loan Guarantee Board             7, XX
Management and Budget, Office of                  5, III, LXXVII; 14, VI; 
                                                  48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II, LXIV
Micronesian Status Negotiations, Office for       32, XXVII
Millenium Challenge Corporation                   22, XIII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Morris K. Udall Scholarship and Excellence in     36, XVI
     National Environmental Policy Foundation
Museum and Library Services, Institute of         2, XXXI
National Aeronautics and Space Administration     2, XVIII; 5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National and Community Service, Corporation for   45, XII, XXV
National Archives and Records Administration      2, XXVI; 5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National Council on Disability                    34, XII
National Counterintelligence Center               32, XVIII
National Credit Union Administration              12, VII
National Crime Prevention and Privacy Compact     28, IX
     Council
National Drug Control Policy, Office of           21, III
National Endowment for the Arts                   2, XXXII
National Endowment for the Humanities             2, XXXIII
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Intelligence, Office of Director of      32, XVII
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV, VI
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII

[[Page 798]]

National Science Foundation                       2, XXV; 5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Interstate Low-Level Radioactive Waste  10, XVIII
     Commission
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Oklahoma City National Memorial Trust             36, XV
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Patent and Trademark Office, United States        37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Human Resources Management and Labor Relations  5, XCIX
       Systems, Department of Defense
  Human Resources Management and Labor Relations  5, XCVII
       Systems, Department of Homeland Security
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
       Acquisition Regulation
  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Pipeline and Hazardous Materials Safety           49, I
     Administration
Postal Regulatory Commission                      5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Recovery Accountability and Transparency Board    4, II
Refugee Resettlement, Office of                   45, IV
Relocation Allowances                             41, 302
Research and Innovative Technology                49, XI
     Administration
Rural Business-Cooperative Service                7, XVIII, XLII, L
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV, L
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII, L
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
   National Security Council
[[Page 799]]

Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     2, XXVII; 13, I
Smithsonian Institution                           36, V
Social Security Administration                    2, XXIII; 20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  2, VI; 22, I; 28, XI
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     2, XII; 5, L
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II
  Federal Motor Carrier Safety Administration     49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Pipeline and Hazardous Materials Safety         49, I
       Administration
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Security Administration            49, XII
Transportation Statistics Bureau                  49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV; 
                                                  31, IX
  Alcohol and Tobacco Tax and Trade Bureau        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs and Border Protection Bureau            19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Claims Collection Standards             31, IX
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  Investment Security, Office of                  31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       2, VIII; 38, I
  Federal Acquisition Regulation                  48, 8

[[Page 800]]

Veterans' Employment and Training Service,        41, 61; 20, IX
     Office of the Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 801]]







                      Table of OMB Control Numbers



The OMB control numbers for chapter IV of title 42 appear in Sec.  
400.310. Sections 400.300 and 400.310 are reprinted below for the 
convenience of the user.

  Subpart C_OMB Control Numbers for Approved Collections of Information

    Source: 49 FR 4477, Feb. 7, 1984, unless therwise noted.

Sec.  400.300  Scope.

    This subpart collects and displays control numbers assigned by the 
Office of Management and Budget (OMB) to collections of information 
contained in CMS regulations, in accordance with OMB's regulations for 
controlling paperwork burdens on the public, 5 CFR part 1320. CMS 
intends that the subpart comply with the requirements of section 3507(f) 
of the Paperwork Reduction Act of 1980, 44 U.S.C. chapter 35 which 
requires that agencies shall not engage in a ``collection of 
information'' without obtaining a control number from OMB.

Sec.  400.310  Display of currently valid OMB control numbers.

------------------------------------------------------------------------
                                                             Current OMB
Sections in 42 CFR that contain collections of information  control Nos.
------------------------------------------------------------------------
403.510...................................................    0938--0641
405.509...................................................    0938--0666
405.512...................................................    0938--0008
405.2112, 405.2123, 405.2134, 405.2136-405.2140, 405.2171.    0938--0386
409.43....................................................    0938--0365
410.105...................................................    0938--0267
411.25, 411.32............................................    0938--0564
411.54....................................................    0938--0558
411.165...................................................    0938--0564
411.404, 411.406..........................................    0938--0465
411.408...................................................    0938--0566
412.42....................................................    0938--0666
412.92....................................................    0938--0477
412.105...................................................    0938--0456
412.230, 412.232, 412.234, 412.236, 412.254, 412.260,         0938--0573
 412.266, 412.278.........................................
415.60....................................................     0938-0301
415.162...................................................     0938-0301
416.43....................................................    0938--0506
416.47....................................................    0938--0266
                                                                     and
                                                              0938--0506
417.126...................................................    0938--0472
417.436, 417.801..........................................    0938--0610
418.22, 418.24, 418.28, 418.56, 418.58, 418.70, 418.74....    0938--0302
418.30, 418.82, 418.83, 418.96, 418.100...................    0938--0475
418.96, 418.100...........................................    0938--0302
421.117...................................................    0938--0542
424.3.....................................................    0938--0008
424.5, 424.7, 424.20......................................    0938--0454
424.22....................................................    0938--0489
424.32, 424.34............................................    0938--0008
431.17....................................................    0938--0467
431.50, 431.52, 431.55....................................    0938--0247
431.107...................................................    0938--0610
431.306...................................................    0938--0467
431.625...................................................    0938--0247
431.630...................................................    0938--0445
431.800...................................................    0938--0247
431.806, 431.830, 431.432, 431.834, 431.836...............    0938--0438
432.50....................................................    0938--0459
433.36, 433.37............................................    0938--0247
433.68, 433.74............................................    0938--0618
433.110, 433.112-433.114, 433.116, 433.117, 433.119-          0938--0247
 433.121, 433.123, 433.127, 433.130, 433.131, 433.135.....
433.138...................................................    0938--0502
                                                              0938--0553
                                                                     and
                                                              0938--0555
433.139...................................................    0938--0459
                                                              0938--0554
                                                                     and
                                                              0938--0555
434.27....................................................    0938--0572
434.28....................................................    0938--0610
435.1, 435.910, 435.919, 435.920, 435.940, 435.945,           0938--0247
 435.948, 435.952, 435.953, 435.955, 435.960, 435.965,
 435.1003, 441.11, 441.15, 441.20.........................
441.56, 441.58, 441.60, 441.61............................    0938--0354
441.302...................................................    0938--0449
441.303...................................................    0938--0272
                                                                     and
                                                              0938--0449
441.351, 441.352, 441.353, 441.356, 441.365...............    0938--0613
442.505...................................................    0938--0366
447.31....................................................    0938--0287
447.45, 447.50, 447.51, 447.52............................    0938--0247
447.53....................................................    0938--0429
447.55....................................................    0938--0247
447.253...................................................    0938--0366
                                                              0938--0523
                                                                     and
                                                              0938--0556
447.255...................................................    0938--0193
447.272, 447.299..........................................    0938--0618
447.302, 447.331, 447.332, 447.333........................    0938--0247
456.80....................................................    0938--0247
456.654...................................................    0938--0445
456.700, 456.705, 456.709, 456.711, 456.712...............    0938--0659
462.102, 462.103..........................................    0938--0526
466.70, 466.72, 466.74....................................    0938--0445

[[Page 802]]

 
466.78....................................................    0938--0445
                                                                     and
                                                              0938--0665
466.80, 466.94............................................    0938--0445
473.18, 473.34, 473.36, 473.42............................    0938--0443
476.104, 476.105, 476.116, 476.134........................    0938--0426
481.61....................................................    0938--0328
482.12, 482.21, 482.22, 482.27, 482.30, 482.41, 482.43,       0938--0328
 482.53, 482.56, 482.57, 482.60, 482.62...................
483.10....................................................    0938--0610
483.410, 483.420, 483.440, 483.460, 483.470...............    0938--0366
484.1, 484.2..............................................    0938--0365
484.10....................................................    0938--0365
                                                                     and
                                                              0938--0610
484.12, 484.14, 484.16, 484.18, 484.30, 484.32, 484.34,       0938--0365
 484.36, 484.48, 484.52...................................
485.56, 485.58, 485.60, 485.64, 485.66....................    0938--0267
                                                                     and
                                                              0938--0538
485.709, 485.711, 485.717, 485.719, 485.721, 487.723,         0938--0336
 485.725, 485.727.........................................
486.104, 486.106, 486.110.................................    0938--0338
486.155, 486.161, 486.163.................................    0938--0336
488.10....................................................    0938--0646
488.18....................................................    0938--0667
488.26....................................................    0938--0646
489.20....................................................    0938--0564
                                                                     and
                                                              0938--0667
489.24....................................................    0938--0334
                                                              0938--0663
                                                                     and
                                                              0938--0667
489.102...................................................    0938--0610
491.9, 491.10.............................................    0938--0334
493.35, 493.37, 493.39, 493.43, 493.45, 493.47, 493.49,
 493.51, 493.53,..........................................
493.55, 493.60, 493.61, 493.62, 493.63....................    0938--0612
493.614, 493.633, 494.634.................................    0938--0607
493.801-493.1285, 493.1425, 493.1701, 493.1703, 493.1705,     0938--0612
 493.1707, 493.1709, 493.1711, 493.1713, 493.1715,
 493.1717, 493.1719, 493.1721, 493.1775, 493.1776,
 493.1777, 493.1780, 493.2001.............................
494.52, 494.54, 494.56, 494.58, 494.64....................    0938--0608
498.22, 498.40, 498.58, 498.82............................    0938--0508
1004.40, 1004.50, 1004.60, 1004.70........................    0938--0444
------------------------------------------------------------------------


[60 FR 50445, Sept. 29, 1995, as amended at 60 FR 63188, Dec. 8, 1995]

[[Page 803]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations that were 
made by documents published in the Federal Register since January 1, 
2001, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 2001, see the ``List of CFR Sections 
Affected, 1949-1963, 1964-1972, 1973-1985, and 1986-2000'' published in 
11 separate volumes.

                                  2001

42 CFR
                                                                   66 FR
                                                                    Page
Chapter IV
482.52 (a) revised..................................................4686
    Regulation at 66 FR 4686 eff. date delayed.....................15352
    Regulation at 66 FR 4686 delayed to 11-14-01...................27598
    Regulation at 66 FR 4686 withdrawn.............................56768
    (a) revised; (c) added.........................................56769
483.350--483.376 (Subpart G) Added; interim.........................7161
    Regulation at 66 FR 7161 eff. date delayed.....................15800
483.352 Amended; interim...........................................28116
483.358 (a), (c), (d), (f) introductory text, (g)(1), (3) and (j) 
        revised; (b) amended; interim..............................28116
483.360 Introductory text revised; interim.........................28117
483.362 (b) and (c) revised; interim...............................28117
483.364 (c) and (d) revised; interim...............................28117
483.374 (c) added; interim.........................................28117
484.14 (g) amended.................................................32778
484.36 (d)(3) amended..............................................32778
484.52 (b) amended.................................................32778
485 Technical correction....................................13020, 13021
485.610 (a)(2)(ii) and (b) revised; (c) added......................39938
485.612 Revised; interim...........................................32196
485.639 (c) revised.................................................4687
    Regulation at 66 FR 4687 eff. date delayed.....................15352
    Regulation at 66 FR 4687 delayed to 11-14-01...................27598
    (b) revised....................................................39938
    Regulation at 66 FR 4687 withdrawn.............................56768
    (c) revised; (e) added.........................................56769
485.643 (f) revised................................................39938
486.301 (b)(4) added...............................................67111
486.302 Amended....................................................39938
486.309 Added......................................................67111
489 Technical correction............................................3497
489.20 (s) introductory text revised...............................39601
489.21 (h) revised.................................................39601
489.24 (i) corrected................................................1599
    (i)(2) introductory text and (ii) revised......................59923
498.2 Regulation at 65 FR 83154 confirmed..........................14861
Chapter V
Chapter V Nomenclature change......................................39452
1000.10 Amended....................................................39452
1001.952 (v) added.................................................62989
    (v)(4)(iii) corrected..........................................63749
1001.101--1001.1701 (Subpart C) Appendix A added...................62991
1003.101 Amended...................................................39452

                                  2002

42 CFR
                                                                   67 FR
                                                                    Page
Chapter IV
482.23 (c)(2) amended..............................................61814
483.40 (b)(3) revised..............................................61814
484.18 (c) amended.................................................61814
485.618 (d) revised................................................80041
485.645 (d)(6) revised.............................................50120

[[Page 804]]

489 Technical correction.............................11549, 13278, 15011
489.27 Revised.....................................................16669
Chapter V
Chapter V Nomenclature change......................................36540
1001.101 (c) introductory text revised.............................11932
1001.102 (b)(1) and (c)(1) revised.................................11932
1001.201 (b)(2)(i) and (3)(i) revised..............................11932
    (b)(3)(i) revised..............................................21579
1001.951 (b)(1)(ii) revised........................................11933
1001.952 (b)(5), (c)(5), (d)(5), (e)(1)(ii), (2)(ii), (f)(2), (h) 
        introductory text, (1) introductory text, (iii) 
        introductory text, (2) introductory text, (3) introductory 
        text, (iii) introductory text, (5)(iii), (i), (n)(6), 
        (o)(5) and (s) introductory text revised; (b)(6), (c)(6) 
        and (j)(2) amended; (b) concluding text, (c) concluding 
        text and (j) concluding text removed.......................11933
1001.1501 (b) revised..............................................11935
1001.2007 (d) revised..............................................11935
1001.3005 (a) revised; (e) added...................................11935
1003 Authority citation revised....................................76905
1003.100 (b)(1)(iv), (xii) and (xiii) revised; (b)(1)(xiv) and 
        (xv) added.................................................11935
    (a), (b)(1)(xiv) and (xv) revised; (b)(1)(xvi) added...........76905
1003.101 Amended............................................11935, 76905
1003.102 (b)(16) added.............................................76905
1003.103 (l) added.................................................76905
1003.106 (a)(4)(iii) revised.......................................11935
1005.7 (e)(1) revised..............................................11936
1005.16 (b) revised................................................11936
1008.37 Revised....................................................11936

                                  2003

42 CFR
                                                                   68 FR
                                                                    Page
Chapter IV
482.12 (f)(3) added; eff. 11-10-03.................................53262
482.21 Revised......................................................3454
482.41 (b)(1) introductory text, and (i) revised; (b)(7)(iv) added
                                                                    1386
483 Technical correction....................................55882, 58756
483.5 Revised......................................................46071
483.10 (b)(12) added...............................................46072
483.12 (a)(8) and (b)(4) added.....................................46072
483.20 (k)(1) amended..............................................46072
483.35 (h) redesignated as (i); new (h) added; eff. 10-27-03.......55539
483.70 (a) introductory text revised; (a)(4) added..................1387
483.75 (e)(1) amended; (q) added; eff. 10-27-03....................55539
483.160 Added; eff. 10-27-03.......................................55539
483.301--483.311 (Subpart D) Heading revised.......................55539
483.470 (j)(1)(i), (iii) and (2) revised; (j)(3) added..............1387
484.265 Added......................................................67960
485 Policy statement................................................9567
    Technical correction....................................22268, 32400
485.623 (d)(1) and (2) revised; (d)(5) added........................1387
488 Technical correction....................................55882, 58756
488.301 Amended; eff. 10-27-03.....................................55539
488.438 (d)(3) added...............................................46072
489 Technical correction.............................20349, 55882, 58756
489.2 (b)(9) added.................................................66720
489.10 (a) and (c) revised.........................................66720
489.20 (p) revised.................................................16669
    (g) revised....................................................43942
    (s)(12) revised................................................46072
489.22 (d) amended.................................................46072
489.24 (i)removed; (c) through (h) redesignated as (d) through new 
        (i); (a) and new (d) revised; (b), new (e)(1)(i), (ii)(C), 
        (2)(iii), (3), (g), (h)(1), (2) introductory text, 
        (iii)(B), (vi) and (4) amended; new (c) and (j) added; 
        eff. 11-10-03..............................................53262
489.27 Revised.....................................................16669
489.53 (a)(3) revised..............................................66720
489.102 (a) introductory text revised..............................66720
491.2 Revised......................................................74816
491.3 Revised......................................................74816
491.5 (b) revised; (d) and (e) removed; (f) redesignated as (d)....74816
491.8 (a)(6) revised; (d) added....................................74817
491.11 Revised.....................................................74817
493.2 Amended.......................................................3702
    Corrected......................................................50723
493.3 (b)(3) amended................................................3702
493.19 (e)(1) correctly revised....................................50723
493.20 (b) and (c) amended..........................................3702
    (c) correctly revised..........................................50723
493.25 (b), (c) and (d) amended.....................................3702
    (d) correctly revised..........................................50723

[[Page 805]]

493.43 (a) amended..................................................3702
493.45 (c)(3) amended...............................................3702
493.47 (c)(2) and (3) amended.......................................3702
    (c)(2) correctly revised.......................................50723
493.49 (a)(3) amended...............................................3702
493.643 (c)(3)(ix) amended..........................................3702
493.801--493.865 (Subpart H) Heading revised........................3702
493.801 (a)(2)(ii) amended..........................................3702
493.803 (a) amended.................................................3702
493.807 Heading revised.............................................3702
493.901--493.959 (Subpart I) Heading revised........................3702
493.911 (c)(1) amended..............................................3702
493.913 (c)(1) amended..............................................3702
493.915 (c)(1) amended..............................................3702
493.917 (c)(1) amended..............................................3702
493.919 (c)(1) amended..............................................3702
493.923 (b)(1) amended..............................................3702
493.927 (c)(1) amended..............................................3702
493.931 (c)(1) amended..............................................3702
493.933 (c)(1) amended..............................................3702
493.937 (c)(1) amended..............................................3702
493.941 (c)(1) amended..............................................3702
493.945 (a)(1) amended..............................................3702
493.1100--493.1105 (Subpart J) Revised..............................3703
493.1105 (a)(3) introductory text, (ii), (5), (6)(i), and (b) 
        corrected..................................................50723
493.1200--493.1299 (Subpart K) Revised..............................3703
493.1200 (a), (b) and (c) corrected................................50724
493.1208 Corrected.................................................50724
493.1234 Corrected.................................................50724
493.1239 Heading, (a), (b), and (c) corrected......................50724
493.1249 Heading, (b) and (c) corrected............................50724
493.1251 (b)(11) and (13) corrected................................50724
493.1253 (b)(2) corrected..........................................50724
493.1256 (a) and (e)(1) corrected..................................50724
493.1271 (f) corrected.............................................50724
493.1273 (a) corrected.............................................50724
493.1274 (d)(2)(iii) and (h) corrected.............................50724
493.1276 (d) corrected.............................................50724
493.1278 (g) corrected.............................................50724
493.1289 Heading, (b) and (c) corrected............................50724
493.1291 (a), (c)(1) and (g) corrected.............................50724
493.1299 Heading, (b) and (c) corrected............................50724
493.1351--493.1495 (Subpart M) Heading revised......................3713
493.1359 (b)(2) amended.............................................3713
    (b)(2) correctly revised.......................................50724
493.1407 (e)(5) amended.............................................3713
493.1443 (b)(3) revised.............................................3713
493.1445 (e)(5) amended.............................................3714
493.1451 (c)(4) amended.............................................3714
493.1471 (b)(2) amended.............................................3714
493.1485 (a) amended................................................3714
493.1701--493.1721 (Subpart P) Removed..............................3714
493.1844 (c)(1) amended.............................................3714
493.2001 (e)(1) amended; (e)(4) revised.............................3714
498.2 Amended......................................................66721

                                  2004

42 CFR
                                                                   69 FR
                                                                    Page
Title 42 Nomenclature change.......................................18803
Chapter IV
482 Application deadline...........................................69536
482.41 (b) revised.................................................49267
482.43 (c)(6), (7) and (8) added...................................49268
483 Application deadline...........................................69536
483.70 (a) revised.................................................49268
483.470 (j) revised................................................49271
484 Technical correction...........................................69686
484.4 Amended......................................................66426
484.225 (d) redesignated as (g) and revised; new (d), (e) and (f) 
        added......................................................62138
485 Application deadline...........................................69536
485.610 (b) introductory text and (c) revised; (b)(3) added........49271
    (b)(3) removed; (c) corrected..................................60252
485.618 (d)(1) introductory text revised; (d)(2)(iv) and (3) 
        amended....................................................49271
485.620 (a) revised................................................49271
    (a) corrected..................................................60252
485.623 (d)(1) and (5) revised; (d)(6) added.......................49271
485.645 (a)(2) revised.............................................49272
485.647 Added......................................................49272
486.150--486.163 (Subpart D) Removed...............................66426
489 Authority citation revised.....................................69268
    Application deadline...........................................69536
489.20 (m) amended; (t) added......................................49272
489.27 (b) revised.................................................69268
489.53 (b)(2) amended..............................................49272
493.945 (b)(3)(ii)(C) table correctly amended; CFR correction......57859

[[Page 806]]

Chapter V
1003 Authority citation revised....................................28845
1003.100 (a), (b)(1)(xv) and (xvi) revised; (b)(1)(xvii) added; 
        interim....................................................28845
    Regulation at 69 FR 28845 confirmed............................74453
1003.101 Amended; interim..........................................28845
    Regulation at 69 FR 28845 confirmed............................74453
1003.102 (b)(17), (18) and (19) added; interim.....................28845
    Regulation at 69 FR 28845 confirmed............................74453
1003.103 (m) added; interim........................................28845
    Regulation at 69 FR 28845 confirmed............................74453

                                  2005

42 CFR
                                                                   70 FR
                                                                    Page
Chapter IV
482--498 (Subchapter G) Regulation at 64 FR 66279 confirmed........71334
482.13 Revised; eff. 1-8-07........................................41426
482.22 (c)(5) revised..............................................68694
482.23 (c)(2) revised..............................................68694
482.24 (c)(1) and (2)(i) revised...................................68694
482.25 (b)(2) revised..............................................68694
482.41 (b)(9)(iii) revised; (b)(9)(iv) amended; (b)(9)(v) added; 
        eff. 10-23-06..............................................55340
482.52 (b)(3) revised..............................................68694
483.5 (a) amended; interim.........................................39229
    (d) and (e) added; eff. 10-23-06...............................55340
483.20 (m)(2)(ii) amended; interim.................................39229
483.70 (a)(6)(iii) and (7) revised; (a)(6)(iv) amended; (a)(6)(v) 
        added; eff. 10-23-06.......................................55340
483.102 (b)(3)(ii) amended; interim................................39229
483.136 (a) amended; interim.......................................39229
483.470 (j)(7)(ii)(C) and (D) amended; (j)(7)(ii)(E) added; eff. 
        10-23-06...................................................55340
484.225 (g) redesignated as (h); (f) and new (h) revised; new (g) 
        and (i) added..............................................65935
485 Technical correction...........................................58287
485.610 Amended....................................................48143
485.618 (d)(1) introductory text revised; (d)(2) and (3) 
        redesignated as (d)(3) and (4); new (d)(2) added; new 
        (d)(3)(iv) and (4) amended.................................68230
485.623 (d)(7)(iii) revised; (d)(7)(iv) amended; (d)(7)(v) added; 
        eff. 10-23-06..............................................55341
486 Authority citation revised.....................................31046
486.1 (a) revised..................................................31046
486.301--486.348 (Subpart G) Revised...............................31046
488.1 Amended......................................................68230
489 Technical correction...........................................58287
489.20 (i)(2)(ii) amended; interim..................................9471
489.24 (b) amended; (f) revised....................................48143
489.27 Revised.....................................................68724
489.53 (a)(15) added...............................................20781
491.2 Revised; interim.............................................55345
491.3 Revised; interim.............................................55346
491.5 (b) and (d) revised; (e) and (f) added; interim..............55346
491.8 (a) revised; (d) removed; interim............................55346
491.11 Revised; interim............................................55346
498.2 Amended......................................................31054
498.3 (b)(17) added................................................20781
    (b)(17) correctly revised......................................37505
505 Technical correction...........................................58287
505.3 Amended......................................................48143
505.13--505.19 (Subpart B) Added...................................48144
Chapter V
1001 Authority citation revised....................................45136
1001.952 (w), (x) and (y) added; eff. 10-10-06.....................45136

                                  2007

42 CFR
                                                                   72 FR
                                                                    Page
482.22 (c)(5) revised; interim.....................................66933
482.23 (b)(1) amended; interim.....................................66933
482.24 (c)(2)(i) revised; interim..................................66933
482 Authority citation revised.....................................15273
482.27 (a) designation removed; (b) and (c) redesignated as (a) 
        and (b); new (b) revised; new (c) added; interim; eff. 2-
        20-08......................................................48573
482.51 (b)(1) revised; interim.....................................66933
482.52 (b)(1) and (3) revised; (b)(4) removed; interim.............66934
482.56 (a)(2) and (b) revised......................................66406
482.60 Added.......................................................60788
482.61 Added.......................................................60788

[[Page 807]]

482.62 Added.......................................................60788
482.66 Added.......................................................60788
482.68--482.104 (Subpart E) Revised................................15273
483.5 Regulation at 71 FR 39229 confirmed..........................38690
483.20 Regulation at 71 FR 39229 confirmed.........................38690
483.102 Regulation at 71 FR 39229 confirmed........................38690
483.136 Regulation at 71 FR 39229 confirmed........................38690
484 Technical correction...........................................67656
484.4 Amended......................................................66406
484.205 (a)(3) and (e) removed; (a)(4) and (f) redesignated as new 
        (a)(3) and (e); (b) introductory text revised; eff. 1-1-08
                                                                   49878
484.220 Revised; eff. 1-1-08.......................................49879
484.230 Amended; eff. 1-1-08.......................................49879
484.237 Removed; eff. 1-1-08.......................................49879
484.240 (b) revised; eff. 1-1-08...................................49879
485.51 (a) revised; (c) added......................................66408
485.70 (c), (e) and (m) revised....................................66408
485.610 (e) added; interim.........................................66934
485.635 (e) added..................................................66408
488 Authority citation revised.......................53648, 61545, 71583
488.6 (a) amended..................................................15278
488.30 Added.......................................................53648
488.61 Added.......................................................15278
489 Technical correction..............................3748, 57634, 62585
    Authority citation amended.....................................47412
489.3 Amended......................................................47412
489.12 (a)(2) revised; (a)(3) redesignated as (a)(4); new (a)(3) 
        added......................................................47413
489.20 (u) and (v) added...........................................47413
    (w) added......................................................53649
489.24 (a)(2) revised..............................................47413
489.29 Added; eff. 7-5-07..........................................30711
489.53 (c) and (d) redesignated as (d) and (e); new (c) added; new 
        (d)(1) amended.............................................47413
    (a)(16) added..................................................53649
498.2 Amended......................................................15280
Chapter V
1001.952 (w) added.................................................56644

                                  2008

42 CFR
                                                                   73 FR
                                                                    Page
482 Technical correction......................................2568, 9860
482.27 Regulation at 72 FR 48573 confirmed.........................36471
483.70 (a)(8) added; eff. 10-14-08.................................47091
484 Technical correction............................................2568
484.4 Correctly amended.............................................2433
485 Technical correction...............................2568, 9860, 80302
485.58 Introductory text, (a)(1)(i) and (e)(2) revised.............69941
485.70 (c), (e), (j) introductory text, (2) and (3) revised; (k) 
        removed; (l) and (m) redesignated as new (k) and (l).......69941
485.610 (e) introductory text correctly revised.....................9862
485.635 (e) revised................................................69941
485.703 Amended....................................................69941
485.711 Introductory text, (b)(3) and (c) revised..................69941
485.717 Revised....................................................69942
486 Technical amendments...........................................80302
486.104 (a) introductory text and (1) revised; (a)(4) added........69942
488 Authority citation revised...............................3409, 11048
488.60 (a) revised; eff. 10-14-08..................................20474
488.604--488.610 (Subpart H) Added; eff. 10-14-08..................20475
489 Technical correction...........................................79664
    Technical amendments...........................................80302
489.3 Amended......................................................48757
489.20 Regulation at 71 FR 9471 confirmed...........................9684
    (r)(2) and (u) revised; (v) and (w) redesignated as (w) and 
(x); new (v) added.................................................48757
    (s)(12) through (15) redesignated as (s)(13) through (16); new 
(s)(12) added......................................................69942
489.24 (a)(2), (f) and (j) revised.................................48758
489.53 (c) revised.................................................48758
494 Added; eff. 10-14-08...........................................20475
498.1 (g) revised..................................................36462
498.2 Amended......................................................36462
498.5 (f)(2) revised; (l) added....................................36462
498.22 (a) and (b)(1) revised......................................36462
498.40 (a)(1) revised..............................................36462
498.44 Revised.....................................................36462
498.56 (a)(2) revised; (e) added...................................36463
498.78 (a) revised.................................................36463
498.79 Added.......................................................36463
498.86 (a) revised.................................................36463
498.88 (g) added...................................................36463
Chapter V
1008.31 (b) revised; interim.......................................15939
    Regulation at 73 FR 15939 confirmed............................40983

[[Page 808]]

1008.36 (b)(6) removed; (b)(7) and (8) redesignated as new (b)(6) 
        and (7); interim...........................................15939
    Regulation at 73 FR 15939 confirmed............................40983
1008.43 (d) revised; interim.......................................15939
    Regulation at 73 FR 15939 confirmed............................40983

                                  2009

  (Regulations published from January 1, 2009, through October 1, 2009)

42 CFR
                                                                   74 FR
                                                                    Page
483 Technical correction...........................................48865
483.20 (b)(1)(xvii), (f)(2) and (3) introductory text revised......40363
483.75 (j) heading revised.........................................40363
483.315 (d)(2), (e), (h), (i) introductory text and (2) revised; 
        (f) removed................................................40363
485.610 (b)(3) revised; (b)(4) added...............................44001
489.24 (a)(2) revised..............................................44001


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