[Federal Register Volume 60, Number 52 (Friday, March 17, 1995)]
[Notices]
[Pages 14584-14586]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6614]



      

[[Page 14583]]

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Part VI





Department of Health and Human Services





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Food and Drug Administration



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Medical Devices: Mammography Quality Standards Act of 1992, Inspection 
Fees; Notice

  Federal Register / Vol. 60, No. 52 / Friday, March 17, 1995 / 
Notices  
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[[Page 14584]] 


DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration
[Docket No. 94N-0335]


Medical Devices; Mammography Quality Standards Act of 1992; 
Inspection Fees

AGENCY: Food and Drug Administration, HHS.
ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA) is announcing the fees 
it will assess for inspections of mammography facilities during fiscal 
year 1995 (FY 95). The Mammography Quality Standards Act of 1992 (MQSA) 
requires FDA to assess and collect fees from mammography facilities to 
cover the costs of annual inspections required by the MQSA. This notice 
explains which facilities are subject to payment of inspection fees, 
provides information on the costs included in developing inspection 
fees, and provides information on the inspection, billing, and 
collection processes.

DATES: Effective October 1, 1994, for all inspections conducted under 
42 U.S.C. 263b(g). Written comments by June 15, 1995.

ADDRESSES: Submit written comments to the Dockets Management Branch 
(HFA-305), Food and Drug Administration, rm.1-23, 12420 Parklawn Dr., 
Rockville, MD 20857.

FOR FURTHER INFORMATION CONTACT: John L. McCrohan, Center for Devices 
and Radiological Health (HFZ-240), Food and Drug Administration, 1350 
Piccard Dr., Rockville, MD 20850, 301-594-3332, fax 301-594-3306.
SUPPLEMENTARY INFORMATION:

I. Background

    The MQSA amended Title III of the Public Health Services Act (the 
PHS Act) (42 U.S.C. 262 et seq.) by adding a new section 354 (42 U.S.C. 
263b) to require uniform national quality standards for mammography 
facilities. The MQSA requires all mammography facilities, other than 
facilities of the Department of Veterans Affairs, to be accredited by 
an approved accreditation body and certified by the Secretary of Health 
and Human Services as meeting quality standards. Facilities must obtain 
a certificate by October 1, 1994, in order to continue to legally 
provide mammography services. See 58 FR 67558, December 21, 1993, 
``Mammography Facilities--Requirements for Accrediting Bodies and 
Quality Standards and Certification Requirements,'' interim rules and 
59 FR 49808, September 30, 1994, ``Quality Standards and Certification 
Requirements for Mammography Facilities,'' amending the interim rules. 
The MQSA requires FDA to establish a Federal certification and 
inspection program for mammography facilities; regulations and 
standards for accreditation bodies; and standards for equipment, 
personnel, quality assurance, and recordkeeping and reporting by 
mammography facilities.
    The MQSA requires annual facility inspections to determine 
compliance with the quality standards. Section 354(r) of the PHS Act 
requires FDA to assess and collect fees for inspections of all 
mammography facilities, other than Governmental entities as determined 
by FDA, to cover the costs of inspections. FDA is providing notice of 
the fees to be assessed during FY 95 and additional information 
relating to those fees. Although the MQSA does not require FDA to 
solicit comments on fee assessment and collection, FDA is inviting 
comments from interested persons in order to have the benefit of 
additional views and information.

II. Inspections under the Mammography Quality Standards Act of 1992

    Section 354(g)(1) of the PHS Act requires FDA, or a State operating 
under a delegation of authority from FDA, to conduct an annual 
inspection of each mammography facility. The purpose of the annual 
inspection is to determine facility compliance with quality standards 
established under the MQSA. The quality standards to be enforced during 
FY 95 were established by an interim rule published at 58 FR 67565, 
December 21, 1993, ``Quality Standards and Certification Requirements 
for Mammography Facilities,'' amended by an interim rule published at 
59 FR 49808, September 30, 1994, ``Quality Standards and Certification 
Requirements for Mammography Facilities.'' Inspections will be 
conducted by inspectors who have met Federal training requirements and 
who are certified by FDA.
    Under ordinary circumstances, inspections will be conducted during 
the regular business hours of the facility or at a mutually agreed 
time. FDA normally will provide 5 working days advance notice of each 
annual inspection. If a significant deficiency is identified during an 
inspection, FDA will provide information on necessary corrective action 
and in appropriate cases, will schedule a followup inspection after the 
facility has had a reasonable time to correct the deficiency. FDA 
normally will provide 5 working days advance notice of each followup 
inspection. FDA may make unannounced inspections or may provide shorter 
notice if prompt action is necessary to protect the public health (see 
42 U.S.C. 263b(g)(4)).

III. Costs Included in FY 1995 Inspection Fees

    Section 354(r) of the PHS Act requires FDA to assess and collect 
fees from persons who own or lease mammography facilities, or their 
agents, to cover the cost of annual and followup inspections conducted 
by FDA or a State acting under a delegation from FDA. Section 354(r) 
limits FDA's discretion in setting inspection fees in three ways: (1) 
Fees must be set so that, for a given fiscal year, the aggregate amount 
of fees collected will equal the aggregate costs of inspections 
conducted; (2) a facility's liability for fees must be reasonably based 
on the proportion of the inspection costs which relate to the facility; 
and (3) Governmental entities, as determined by FDA, are exempt from 
payment of fees.
    FDA has determined that the following categories of costs are 
recoverable under section 354(r) of the PHS Act and has included them 
in the fees to be assessed in FY 95:
     Personnel costs of annual and followup inspections of 
mammography facilities, including administration and support.
     Purchase of equipment, development of instrument 
calibration procedures, calibration of instruments used in the 
inspections, and modification of training facilities and laboratories 
to support MQSA operations.
     Design, programming, and maintenance of data systems 
necessary to schedule and track inspections and to collect data during 
inspections.
     Training and certification of inspectors (both FDA and 
State inspectors).
     Costs of billing facilities for fees due for annual and 
followup inspections and collecting facility payments.
     Tracking, coordination, and direction of inspections.
     Overhead and support attributable to facility inspections.
    FDA has calculated the fixed and variable amounts of these costs. 
Because facilities and most scientific equipment are durable and can be 
used for a period of years, it is not appropriate to recover the full 
costs of such expenditures in the year of purchase. To do so would 
result in the MQSA inspection fee varying widely from one year to the 
next. Instead, these costs will be [[Page 14585]] recovered over the 
useful life of the asset. FDA has used these data on fixed and variable 
costs to determine fees for two categories of inspection:
     Annual inspection of each mammography facility. The 
recoverable portions of all fixed costs of the inspection program and 
appropriate variable costs are recovered in the annual inspection fee. 
This fee will vary depending on how many mammography units are used by 
a facility. All mammography facilities, except Governmental entities, 
will be subject to this fee.
     Followup inspections. If the annual inspection of a 
facility identifies a deficiency that necessitates a followup 
inspection, that facility will be assessed an additional fee to recover 
the costs of that additional inspection. Only variable costs directly 
related to followup inspections are recovered. Governmental entities 
and all facilities that do not require a followup inspection are not 
subject to this fee.

IV. Inspection Fees to be Assessed During FY 95

    After consulting with the National Mammography Quality Advisory 
Committee, FDA has determined that, for FY 95 (October 1, 1994 to 
September 30, 1995), a facility's inspection fees will be based on the 
number of mammography units used by the facility. Based on information 
submitted by States during contract negotiations and a 1993 survey by 
the National Cancer Institute, FDA estimates that there are 13,252 
mammography units and 10,666 facilities subject to inspection in FY 
1995. Most facilities (83 percent) have only a single mammography unit 
and fewer than 5 percent of facilities have more than two units.
    FDA has determined that the following fees will be assessed for 
facility inspections conducted in fiscal year 1995:

------------------------------------------------------------------------
         Type of Inspection                          Fee                
------------------------------------------------------------------------
Annual.............................  $1,178 for the first unit, plus    
                                      $152 for each additional unit.    
Followup...........................  $670 for each followup inspection. 
------------------------------------------------------------------------

The fee schedule is subject to change each fiscal year to ensure that 
the aggregate amount of fees collected during any fiscal year equals 
the aggregate amount of costs for such fiscal year for inspection of 
facilities
    FDA reviewed and considered several methodologies for setting 
annual inspection fees for FY 95, including fee structures that would 
do one or more of the following: (1) Account for differences in 
facility size (the adopted methodology); (2) establish a flat fee that 
would not vary by facility size; (3) account for regional variations in 
inspection costs; (4) eliminate separate followup inspection fees by 
increasing the annual inspection fee. FDA decided to charge separately 
for annual and followup inspections because FDA believes it is more 
appropriate and equitable for the costs of followup inspections to be 
borne entirely by the facilities that require such inspections. In 
addition, this approach eliminated the need for FDA to attempt to 
estimate the number of followup inspections that will be conducted. FDA 
chose to use a uniform, national fee structure because, at this time, 
the agency lacks sufficient information to adopt any other approach.
    For followup inspections, FDA considered a flat fee (the adopted 
methodology) and an hourly rate that would vary the fee by the length 
of the inspection. FDA has chosen to adopt a flat fee for followup 
inspections because this approach eliminates concerns about variations 
among inspectors and differential treatment of facilities.
    The methodology adopted by FDA to determine inspection fees does 
not pass on the costs of inspecting Governmental entities to other 
facilities. The entire cost of inspecting Governmental entities will be 
borne by FDA and paid out of appropriated funds.
    The agency invites comments on alternative methods of determining 
inspection fees under the MQSA and may consider altering its 
methodology in the future, after actual inspection experience provides 
more accurate data about differences among facilities and variations in 
costs by State, region, or other factors.

V. Facilities Subject to Payment of Inspection Fees

    Under the MQSA, all certified mammography facilities except 
Governmental entities, as determined by FDA, are subject to payment of 
inspection fees (see 42 U.S.C. 263b(r)).
    FDA has developed a definition that will be used to determine 
whether a facility qualifies as a ``Governmental entity'' for the 
purpose of determining whether a facility is exempt from payment of 
inspection fees under 42 U.S.C. 263b(r). A Governmental entity is a 
mammography facility subject to inspection under section 354(g)(1) of 
the Public Health Service Act (42 U.S.C. 263b(g)(1), that meets either 
of the following criteria: (1) Is operated by any Federal department, 
State, district, territory, possession, Federally-recognized Indian 
tribe, city, county, town, village, municipal corporation or similar 
political organization or subpart thereof, or (2) provides services 
under the Breast and Cervical Cancer Mortality Prevention Act of 1990, 
42 U.S.C. 300k et seq., and at least 50 percent of the mammography 
screening examinations provided during the preceding 12 months were 
funded under that statute.
    In making these determinations, FDA reviewed the legislative 
history of the Mammography Quality Standards Act of 1992. There is 
nothing in the legislative history to indicate that Congress intended 
the exemption for Governmental entities to be read expansively. Nor is 
there anything in the legislative history to suggest that Congress 
intended FDA to distinguish among mammography facilities with respect 
to this exemption for any particular policy reason, such as the type of 
organization operating the facility (e.g., facilities that qualify as a 
charitable organization under section 501(c)(3) of the Internal Revenue 
Code), location (e.g., rural facilities), or size (e.g., facilities 
that handle relatively few patients). Accordingly, FDA has interpreted 
the exemption provision in a manner that will recoup the costs of 
inspections from as many facilities as possible. This approach will 
reduce the likelihood that fiscal constraints will undermine the 
agency's ability to perform adequate inspections required by the law.
    FDA determined that the definition of Governmental entity under the 
MQSA should include facilities that are highly dependent on funding 
provided under the Breast and Cervical Cancer Mortality Prevention Act 
of 1990 (BCCMPA) (see 42 U.S.C. 300k et seq.). That statute authorizes 
grants to States for programs to screen women for breast and cervical 
cancer as a preventive health measure (see 42 U.S.C. 300k). Low income 
women are given priority for screening services, including free 
services to any woman with income below the official poverty line (see 
42 U.S.C. 300n). Advisory committee discussions raised concern that 
assessing an inspection fee on certain facilities receiving these 
grants would be at variance with, and could undermine, the initiative 
that Congress legislated through BCCMPA, and that the Department of 
Health and Human Services implemented, to provide mammography screening 
to under-served populations. In response to this concern, FDA decided 
to include in its definition of Governmental entity, those facilities 
with BCCMPA grants that provide at least 50 percent of their 
mammography screening services to the [[Page 14586]] population 
targeted by BCCMPA. FDA believes relatively few (less than 100) 
facilities will qualify as Governmental entities because of their 
dependence on BCCMPA grants. These facilities pursue the same public 
health objectives as the MQSA and are largely dependent on Federal 
payments. Assessing an inspection fee would do little more than shift 
the costs of one Federal program to another Federal program while 
subjecting the Federal government to the transaction costs involved 
with such transfers.
    The agency invites comments on alternative ways to define 
Governmental entities under the MQSA and may consider altering its 
determination in the future, after actual inspection experience 
provides more accurate data about other types of facilities that might 
be included in the category which is exempt from inspection fees under 
42 U.S.C. 263b(r).
    Prior to the first annual inspection of a facility, FDA will 
contact the facility and provide an opportunity for the facility to 
attest that it qualifies as a Governmental entity. Facilities that FDA 
finds to be Governmental entities will not be billed for inspections.

VI. Billing and Collection Procedures

    Within 30 days following inspection, FDA will mail a bill to the 
inspected facility (Governmental entities will not receive bills). The 
bill will set forth the type of inspection conducted (annual or 
followup), the fee to be paid, and the date payment is due (30 days 
after billing date). Inspection fees will be billed to and collected 
from the party that operates the facility. If the facility is owned or 
controlled by an entity other than the operator, it is up to the 
parties to establish, through contract or otherwise, how the costs of 
facility inspections will be allocated.
    If full payment is not received by the due date, a second bill will 
be sent. At that time, interest will begin to accrue at the prevailing 
rate set by the Department of the Treasury (currently, the prevailing 
rate is 13 percent), a 6 percent late payment penalty will be assessed 
in accordance with 45 CFR 30.13, and a $20 administrative fee will be 
assessed for each 30-day period that a balance remains due. If payment 
is not received within 30 days of a third and final bill, FDA may 
initiate action to collect unpaid balances (with interest and 
penalties), including the use of collection agencies and reporting of 
delinquencies to commercial credit reporting agencies.

VII. Review and Appeals Procedures

    FDA will review each declaration that a facility qualifies as a 
Governmental entity. If FDA disallows a facility's claim that it is a 
Governmental entity, a bill will be sent to the facility with payment 
due within 30 days.
    If FDA determines that a facility is not a Governmental entity, but 
the facility believes it qualifies for exemption under the definition 
of Governmental entity set forth above, the facility may appeal FDA's 
determination by explaining and certifying the basis for its belief in 
a letter directed to the FDA Ombudsman, c/o Mammography Quality 
Assurance Program, Food and Drug Administration, P.O. Box 6057, 
Columbia, MD 21045-6057, postmarked within 30 days of FDA's notice to 
the facility that the facility does not qualify as a Governmental 
entity. The FDA Ombudsman will review a facility's claim that it is a 
Governmental entity and will normally reach a decision within 60 days. 
If the Ombudsman determines that a facility does not qualify as a 
Governmental entity, the Ombudsman shall provide a statement of the 
grounds for that determination. The Ombudsman's decision will 
constitute the agency's final decision on the matter. During the time 
required for the Ombudsman's review, FDA's efforts to collect the fee 
will be suspended.

VIII. Request for Comments

    Although MQSA does not require FDA to solicit comments on fee 
exemption, assessment and collection, FDA is inviting comments from 
interested persons in order to have the benefit of additional views and 
information. FDA may consider altering its methodology of defining 
Governmental entities, and assessing and collecting fees under MQSA in 
future years, after actual inspection experience provides more accurate 
data about differences among facilities and variations in costs by 
State, region, or other factors.
    Interested persons may on or before June 15, 1995 submit to the 
Dockets Management Branch (address above) written comments regarding 
this notice. Two copies of any comments are to be submitted, except 
that individuals may submit one copy. Comments are to be identified 
with the docket number found in brackets in the heading of this 
document. Received comments and a full explanation of the costs 
included and the methodology employed in determining these fees are on 
file with the Dockets Management Branch (address above) and may be seen 
in that office between 9:00 a.m. and 4:00 p.m., Monday through Friday.

    Dated: March 13, 1995.
William B. Schultz,
Deputy Commissoner for Policy.
[FR Doc. 95-6614 Filed 3-16-95; 8:45 am]
BILLING CODE 4160-01-F