[Federal Register Volume 59, Number 160 (Friday, August 19, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20361]


[[Page Unknown]]

[Federal Register: August 19, 1994]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Public Health Service

42 CFR Part 6

 

Federally Supported Health Centers Assistance Act of 1992

AGENCY: Public Health Service, HHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Secretary of Health and Human Services (the 
``Secretary''), in consultation with the Attorney General, proposes to 
issue rules under the ``Federally Supported Health Centers Assistance 
Act of 1992''. The Act provides for liability protection for certain 
health care professionals and entities. This proposed rule sets forth 
information whereby an entity or a person can determine when, and the 
extent to which, it is likely to be protected under the Act.

DATES: The public is invited to submit comments on this proposed rule 
until September 19, 1994.

ADDRESSES: Comments should be submitted to:

Libby Merrill, Office of Program Policy and Development, Bureau of 
Primary Health Care, 4350 East-West Highway, Rockville, Maryland 
20857.

FOR FURTHER INFORMATION CONTACT:

Richard C. Bohrer, Director, Division of Community and Migrant 
Health, Phone: (301) 594-4300.

SUPPLEMENTARY INFORMATION:

I. Introduction

    Section 224(a) of the Public Health Service Act (the Act), (section 
233(a) of Title 42 of the United States Code), provides that the remedy 
against the United States provided under the Federal Tort Claims Act 
(FTCA) resulting from the performance of medical, surgical, dental or 
related functions by any commissioned officer or employee of the Public 
Health Service while acting within the scope of his office or 
employment shall be exclusive of any other civil action or proceeding. 
Public Law 102-501 provides that, subject to its provisions, certain 
entities and officers, employees and contractors of entities shall be 
deemed to be employees of the Public Health Service within the 
exclusive remedy provision of section 224(a). This proposed rule 
implements certain provisions of Pub. L. 102-501.

II. Entities

    An entity will be deemed to be an employee of the Public Health 
Service pursuant to Pub. L. 102-501 only if HHS, in consultation with 
the Attorney General, has determined, and has advised the entity, that 
the entity--
    (A) receives Federal funds under any of the following grant 
programs:
    (1) Section 329 of the Act, 42 U.S.C. 254b (relating to grants for 
migrant health centers);
    (2) Section 330 of the Act, 42 U.S.C. 254c (relating to grants for 
community health centers);
    (3) Section 340 of the Act, 42 U.S.C. 256 (relating to grants for 
health services for the homeless); and
    (4) Section 340A of the Act, 42 U.S.C. 256a (relating to grants for 
health services for residents of public housing); and
    (B) meets the following requirements:
    (1) has implemented appropriate policies and procedures to reduce 
the risk of malpractice and the risk of lawsuits arising out of any 
health or health-related functions performed by the entity;
    (2) has reviewed and verified the professional credentials, 
references, claims history, fitness, progressional review organization 
findings, and license status of its physicians and other licensed or 
certified health care practitioners, and, where necessary, has obtained 
the permission from these individuals to gain access to this 
information;
    (3) has no history of claims having been filed against the United 
States as a result of the application of section 224 to the entity of 
its officers, employees, of contractors as provided for under this 
section, or, is such a history exists, has fully cooperated with the 
Attorney General in defending against any such claims and either has 
taken, or will take, any necessary corrective steps to assure against 
such claims in the future; and
    (4) has fully cooperated with the Attorney General in providing 
information relating to an estimate described under section 224(k) of 
the Act.
    Proposed Sec. 6.5 provides that an entity will be deemed to be an 
entity described in section 224(g) as of the effective date of the 
notice which it receives from the Department of Health and Human 
Services that it has been deemed to be an entity as described for 
purposes of the Act. Each notice shall be effective only as to acts and 
omissions occurring on and after the date specified in the notice and 
prior to January 1, 1996, the statutory sunset date for this program. 
(Proposed Sec. 6.6(a).)
    In some cases, grantees contract with other entities (as opposed to 
individual contractors--see section III below) for the provision of 
health services. The typical situation is a subgrant or contract for 
the provision of the full range of health services. For example, the 
legislative history of Pub. L. 102-501 describes the case of a grantee 
in the Los Angeles area which itself has no clinical staff, but which 
contracts with three primary care clinics for the actual delivery of 
services. If one (or more) of these clinics provides the full range of 
services mandated under section 330 to its own medically undeserved 
population, in accordance with other applicable requirements under 
section 330, it would be eligible for a determination by the Secretary 
that it too is a covered entity. (H.R. Rep. No. 102-823, Part 2, p. 7, 
102d Cong. 2d Sess., Sept. 14, 1992.) Proposed Sec. 6.3(b) provides 
that the Secretary will identify those contracting entities that will 
be subject to coverage under section 224(g) in notices issued pursuant 
to Sec. 6.5.

III. Covered Individuals

    In addition to the entity itself, section 224(g) provides that 
certain individuals may be covered under the FTCA. Officers and 
employees are subject to coverage, as well as certain contractors.
    Public Law 102-501 provides that an individual may be considered to 
be a contractor of an entity described in Pub. L. 102-501 only if--
    (A) the individual normally performs on average at least 32\1/2\ 
hours of service per week for the entity for the period of the 
contract; or
    (B) in the case of an individual who normally performs on average 
less than 32\1/2\ hours of services per week for the entity for the 
period of the contract and is a licensed or certified provider of 
obstetrical services--
    (1) the individual's medical malpractice liability insurance 
coverage does not extend to services performed by the individual for 
the entity under the contract; or
    (2) the Secretary finds that patients to whom the entity furnishes 
services will be deprived of obstetrical services if such individual is 
not considered a contractor of the entity for purposes of paragraph 
(1).
    Coverage of individuals, whether employees of contractors, does not 
extend to acts or omissions that are not related to the grant supported 
activity. The covered entity itself (assuming it meets the statutory 
requirements for FTCA coverage) will be covered for claims against it, 
even if an individual health care practitioner is not covered in a 
particular case. Thus, for example, if a contractor works fewer than 
32\1/2\ hours and is not a provider of obstetrical services, the 
contractor would not be covered for services related to the grant, but 
the grantee itself would be covered.

IV. Covered Acts and Omissions

    Proposed Sec. 6.6 provides elaboration on the scope of the 
statutory protection for covered entities and individuals. Paragraph 
(a) states the relevant dates of coverage. Paragraph (b) repeats the 
provision of section 224(a) that limits coverage to claims for damage 
for personal injury or death resulting from the performance of medical, 
surgical, dental, or related functions. Paragraph (c) states that for 
covered individuals, only acts or omissions within the scope of their 
employment (or contract for services, in the case of covered 
contractors) are covered. Thus, for example, ``moonlighting'' 
activities of a physician employed by a covered grantee would not be 
covered.
    Paragraph (d) of proposed Sec. 6.6 addresses the limitation that 
only acts or omissions related to the grant-supported activity are 
covered. The Department is aware that there has been some confusion 
since the enactment of section 224(g) about the types of activities 
that would be covered. In particular, there have been questions about 
the issue of when coverage is available where individuals who are not 
registered patients of the grantee are treated. This paragraph provides 
clear standards for answering these questions. Coverage will be 
available for the treatment of non-patients of the covered entities 
only when the Secretary determines either that (1) the provision of the 
services to such individuals benefits patients of the entity and 
general populations that could be served by the entity through 
community-wide intervention efforts within the communities served by 
the entity, or (2) the provision of services to such individuals 
facilitates the provision of services to patients of the entity, or (3) 
such services are otherwise required to be provided to such individuals 
under an employment contract or similar arrangement between the entity 
and the covered individual. Examples of situations within the scope of 
proposed Sec. 6.6(d) are as follows:
     A community health center deemed to be a covered entity 
establishes a school-based or school-linked health program as part of 
its grant supported activity. Even though the students treated are not 
necessarily registered patients of the center, the center and its 
health care practitioners will be covered for services provided, if the 
Secretary makes the determination in subparagraph (1).
     A migrant health center requires its physicians to obtain 
staff privileges at a community hospital. As a condition of obtaining 
such privileges, and thus being able to admit the center's patients to 
the hospital, the physicians must agree to provide occasional coverage 
of the hospital's emergency room. The Secretary would be authorized to 
determine that this coverage is necessary to facilitate the provision 
of services to the grantee's patients, and that it would therefore be 
covered by subparagraph (2).
     A homeless health services grantee makes arrangements with 
local community providers for after-hours coverage of its patients. The 
grantee's physicians are required by their employment contracts to 
provide periodic cross-coverage for patients of these providers, in 
order to make this arrangement feasible. The Secretary may determine 
that the arrangement is within the scope of subparagraph (3). Again, 
however, it should be understood that this would not extend the scope 
of coverage under Pub. L. 102-501 to ``moonlighting'' activities by 
center health care practitioners.
    This proposed rule is not intended to constitute, and does not 
constitute, a comprehensive notice pertaining to any provision of Pub. 
L. 102-501 except to the extent that procedures pertaining to 
implementation of Pub. L. 102-501 are described explicitly above. The 
applicability of Pub. L. 102-501 and 42 U.S.C. 233(a) to a particular 
claim or case will depend upon the determination or certification (as 
appropriate) by the Attorney General that the individual or entity is 
covered by Pub. L. 102-501 and was acting within the scope of 
employment, in accordance with normal Department of Justice procedures. 
A determination or certification by the Attorney General is subject to 
judicial review.

Economic Impact

    Executive Order 12866 requires that all regulations reflect 
consideration of alternatives, of costs, benefits, incentives, equity, 
and availability of information. Regulations which are ``significant'' 
because of cost, adverse effects on the economy, inconsistency with 
other agency actions, effects on the budget, or novel legal or policy 
issues, require special analysis. In addition, the Regulatory 
Flexibility Act of 1980 requires that we include an analysis of all 
rules the significantly impact small businesses.
    These proposed regulations provide information whereby health care 
entities or individual scan determine when, and to what extent they are 
likely to be protected for medical malpractice under the Federal Tort 
Claims Act (FTCA). Therefore, the Secretary certifies that the proposed 
regulations will not have a significant effect on a substantial number 
of small entities.
    For this reason, a regulatory analysis is not required.

Paperwork Reduction Act of 1980

    This proposed rule contains no information collection or reporting 
requirements which are subject to review by the Office of Management 
and Budget (OMB) under the Paperwork Reduction Act of 1980.

List of Subjects in 42 CFR Part 6

    Grant Programs--Health.

    Dated: May 9, 1994.
Philip R. Lee,
Assistant Secretary for Health.
    Approved: June 16, 1994.
Donna E. Shalala,
Secretary.

    Part 6 is added to Chapter I of Title 42 to read as follows:

PART 6--FEDERAL TORT CLAIMS ACT COVERAGE OF CERTAIN GRANTEES AND 
INDIVIDUALS

Sec.
6.1  Applicability.
6.2  Definitions.
6.3  Eligible Entities.
6.4  Covered Individuals.
6.5  Deeming Process for Eligible Entities.
6.6  Covered Acts and Omissions.

    Authority: Sections 215 and 224 of the Public Health Service 
Act, 42 U.S.C. 216 and 233.


Sec. 6.1  Applicability.

    This part applies to entities and individuals whose acts and 
omissions related to the performance of medical, surgical, dental, or 
related functions are covered by the Federal Tort Claims Act (28 U.S.C. 
1346(b) and 2671-2680) in accordance with the provisions of section 
224(g) of the Public Health Service Act (42 U.S.C. 233(g)).


Sec. 6.2  Definitions.

    Act means the Public Health Service Act, as amended.
    Attorney General means the Attorney General of the United States 
and any other officer or employee of the Department of Justice to whom 
the authority involved has been delegated.
    Covered entity means an entity described in Sec. 6.3 which has been 
deemed by the Secretary, in accordance with Sec. 6.5, to be covered by 
this part.
    Covered individual means an individual described in Sec. 6.4.
    Effective date as used in Sec. 6.5 and Sec. 6.6 refers to the date 
of the Secretary's determination that an entity is a covered entity.
    Secretary means the Secretary of Health and Human Services (HHS) 
and any other officer or employee of the Department of HHS to whom the 
authority involved has been delegated.
    Subrecipient means an entity which receives a grant or a contract 
from a covered entity to provide a full range of health services on 
behalf of the covered entity.


Sec. 6.3  Eligible entities.

    (a) Grantees. Entities eligible for coverage under this part are 
public and nonprofit private entities receiving Federal funds under any 
of the following grant programs:
    (1) Section 329 of the Act (relating to grants for migrant health 
centers);
    (2) Section 330 of the Act (relating to grants for community health 
centers);
    (3) Section 340 of the Act (relating to grants for health services 
for the homeless); and
    (4) Section 340A of the Act (relating to grants for health services 
for residents of public housing).
    (b) Subrecipients. Entities that are subrecipients of grant funds 
described in paragraph (a) of this section are eligible for coverage 
only if they provide a full range of health care services on behalf of 
an eligible grantee and only for those services carried out under the 
grant funded project.


Sec. 6.4  Covered individuals.

    (a) Officers and employees of a covered entity are eligible for 
coverage under this part.
    (b) Contractors of a covered entity who are physicians or other 
licensed or certified health care practitioners are eligible for 
coverage under this part if they meet the requirements of section 
224(g)(5) of the Act.
    (c) An individual physician or other licensed or certified health 
care practitioner who is an officer, employee, or contractor of a 
covered entity will not be covered for acts or omissions occurring 
after receipt by the entity employing such individual of notice of a 
final determination by the Attorney General that he or she is no longer 
covered by this part, in accordance with section 224(i) of the Act.


Sec. 6.5  Deeming process for eligible entities.

    Eligible entities will be covered by this part only on and after 
the effective date of a determination by the Secretary that they meet 
the requirements of section 224(h) of the Act. In making such 
determination, the Secretary will receive such assurances and conduct 
such investigations as he or she deems necessary.


Sec. 6.6  Covered acts and omissions.

    (a) Only acts and omissions occurring on and after the effective 
date of the Secretary's determination under Sec. 6.5 and before January 
1, 1996, are covered by this part.
    (b) Only claims for damage for personal injury, including death, 
resulting from the performance of medical, surgical, dental, or related 
functions are covered by this part.
    (c) With respect to covered individuals, only acts and omissions 
within the scope of their employment (or contract for services) are 
covered. If a covered individual is providing services which are not on 
behalf of the covered entity, such as on a volunteer basis or on behalf 
of a third-party (except as described in paragraph (d) of this 
section), whether for pay or otherwise, acts or omissions which are 
related to such services are not covered.
    (d) Only acts and omissions related to the grant-supported activity 
of entities are covered. Acts and omissions related to services 
provided to individuals who are not patients of a covered entity will 
be covered only if the Secretary determines that:
    (1) the provision of the services to such individuals benefits 
patients of the entity and general populations that could be served by 
the entity through community-wide intervention efforts within the 
communities served by such entity;
    (2) the provision of the services to such individuals facilitates 
the provision of services to patients of the entity; or
    (3) such services are otherwise required to be provided to such 
individuals under an employment contract or similar arrangement between 
the entity and the covered individual.

[FR Doc. 94-20361 Filed 8-18-94; 8:45 am]
BILLING CODE 4160-15-M