[Federal Register Volume 67, Number 105 (Friday, May 31, 2002)]
[Proposed Rules]
[Pages 38050-38056]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-13615]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of the Secretary

45 CFR Part 162

[CMS-0005-P]
RIN 0938-AK76


Health Insurance Reform: Modifications to Transactions and Code 
Set Standards for Electronic Transactions

AGENCY: Office of the Secretary, HHS.

ACTION: Proposed rule.

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SUMMARY: This rule proposes to adopt modifications to certain standards 
adopted in our regulations entitled ``Health Insurance Reform: 
Standards for Electronic Transactions'' published in the Federal 
Register on August 17, 2000 (65 FR 50312), which

[[Page 38051]]

implemented some of the requirements of the Administrative 
Simplification subtitle of the Health Insurance Portability and 
Accountability Act of 1996. The proposed modifications are a result of 
the Designated Standard Maintenance Organization (DSMO) process to 
maintain standards adopted by the Secretary and to process requests for 
adopting new standards or modifying adopted standards.

DATES: We will consider comments if we receive them at the appropriate 
address, as provided below, no later than 5 p.m. on July 1, 2002.

ADDRESSES: In commenting, please refer to file code CMS-0005-P. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission. Mail written comments (one original and 
three copies) to the following address ONLY: Centers for Medicare and 
Medicaid Services, Department of Health and Human Services, Attention: 
CMS-0005-P, P.O. Box 8010, Baltimore, MD 21244-8010.
    Please allow sufficient time for mailed comments to be timely 
received in the event of delivery delays. If you prefer, you may 
deliver (by hand or courier) your written comments (one original and 
three copies) to one of the following addresses: Room 445-G, Hubert H. 
Humphrey Building, 200 Independence Avenue, SW., Washington, DC 20201, 
or Room C5-14-03, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and could be considered late.
    Comments may also be submitted electronically to the following e-
mail address: [email protected]. For e-mail procedures, see the 
beginning of the SUPPLEMENTARY INFORMATION section.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Stanley Nachimson, (410) 786-6153.

SUPPLEMENTARY INFORMATION:   
    Public Comments: Normally, we provide a 60-day public comment 
period for a proposed rule; for this rule, however, there is a 30-day 
comment period. After publication of the Standards for Electronic 
Transactions final rule (65 FR 50312), we received an overwhelming 
response from the affected industry and industry representatives 
requesting that we modify the standards. The changes we are proposing 
already were subjected to the public DSMO process and were discussed 
and approved by the National Committee on Vital and Health Statistics 
(NCVHS) in public sessions. Therefore, we believe it is unnecessary to 
provide more than a 30-day comment period for this rule.
    Inspection of Public Comments: Comments received timely will be 
available for public inspection as they are received, generally 
beginning approximately 3 weeks after publication of a document, at the 
headquarters of the Centers for Medicare & Medicaid Services, 7500 
Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of 
each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view 
public comments, please call (410) 786-9994.
    Electronic Comments: We will consider all electronic comments that 
include the full name, postal address, and affiliation (if applicable) 
of the sender and are submitted to the electronic address identified in 
the ADDRESSES section of this preamble. All comments must be 
incorporated in the e-mail message because we may not be able to access 
attachments. Electronically submitted comments will be available for 
public inspection at 7500 Security Boulevard, Baltimore, MD 21244.
    Copies: To order copies of the Federal Register containing this 
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Government Printing Office. The web site address is: http://www.access.gpo.gov/nara/index.html.

I. Background

A. Legislation

    The Congress included provisions to address the need for standards 
for electronic transactions and other administrative simplification 
issues in the Health Insurance Portability and Accountability Act of 
1996 (HIPAA), Pub. L. 104-191, which became effective on August 21, 
1996. Through subtitle F of title II of that statute, the Congress 
added to title XI of the Social Security Act (the Act) a new Part C, 
titled Administrative Simplification. Pub. L. 104-191 affects several 
titles in the United States Code. The purpose of this part is to 
improve the Medicare and Medicaid programs in particular and the 
efficiency and effectiveness of the health care system in general by 
encouraging the development of a health information system through the 
establishment of standards and requirements to facilitate the 
electronic transmission of certain health information.
    Part C of title XI consists of sections 1171 through 1179 of the 
Act. These sections define various terms and impose several 
requirements on the Secretary, health plans, health care 
clearinghouses, and certain health care providers.
    We discussed the legislation in greater detail in the Standards for 
Electronic Transactions final rule (Transactions Rule) published on 
August 17, 2000 (65 FR 50312), and in a final rule for Privacy of 
Individually Identifiable Health Information (Privacy Rule) published 
on December 28, 2000 (65 FR 82462). Rather than repeating the 
discussion here, we refer the reader to those documents for further 
information about electronic data interchange and the statutory 
background.
    Section 1172 of the Act makes any standard adopted under part C 
applicable to (1) health plans, (2) health care clearinghouses, and (3) 
health care providers who transmit any health information in electronic 
form in connection with a transaction covered by 45 CFR part 162.
    In general, section 1172 of the Act requires any standard adopted 
by the Secretary under this part to be a standard that has been 
developed, adopted, or modified by a standard setting organization 
(SSO). The Secretary may adopt a different standard if the standard 
will substantially reduce administrative costs to providers and health 
plans compared to the alternatives, and the standard is promulgated in 
accordance with the rulemaking procedures of subchapter III of chapter 
5 of Title 5, United States Code.
    Section 1172 of the Act also sets forth consultation requirements 
that must be met before standards are adopted by the Secretary. In the 
case of a standard that is developed, adopted, or modified by an SSO, 
the SSO must consult with the following Data Content Committees (DCCs) 
in the course of the development, adoption, or modification

[[Page 38052]]

of the standard: the National Uniform Billing Committee (NUBC), the 
National Uniform Claim Committee (NUCC), the Workgroup for Electronic 
Data Interchange (WEDI), and the American Dental Association. In the 
case of any other standard, the Secretary is required to consult with 
each of the above-named groups before adopting the standard and must 
also comply with the provisions of section 1172(f) of the Act regarding 
consultation with the National Committee on Vital and Health Statistics 
(NCVHS).

B. The Transactions Rule

    The SSOs have developed a broad range of implementation 
instructions for implementing standards for particular industry 
sectors, for example, instructions on how to use the ASC X12N 837 to 
claim payment for hospital services. The implementation instructions 
for implementing standards are detailed and highly specific. Section 
1172(d) of the Act requires the Secretary to establish specifications 
for implementing each of the adopted standards, which were adopted in 
the Transactions Rule. However, because the implementation instructions 
are voluminous, they were incorporated by reference in the Transactions 
Rule. This approach, to incorporate by reference, commonly is used by 
the Office of the Federal Register when external standards developed by 
SSOs are adopted as national standards. The approach allows the agency 
to avoid publication of extraordinarily voluminous documents.

C. Designated Standard Maintenance Organizations

    The Transactions Rule acknowledged the need for a group of 
organizations to maintain the standards for health care transaction 
standards adopted by the Secretary, and to receive and process requests 
for adopting new standards or modifying adopted standards. ``Designated 
Standard Maintenance Organization'' (DSMO) is the term used in the 
Transactions Rule to identify the organizations designated by the 
Secretary to undertake those functions. Section 162.910 of the 
Transactions Rule sets forth the conditions under which an organization 
may be designated a DSMO by the Secretary and the functions to be 
performed by a DSMO. On August 17, 2000, the Secretary published a 
Federal Register notice (65 FR 50373) designating the following six 
organizations (three SSOs and three DCCs) as DSMOs. The organization 
names are followed by their respective websites. All of the SSOs (X12, 
NCPDP, and HL 7) that developed standards that the Secretary adopted or 
expects to propose in the near future were designated as DSMOs:
     Accredited Standards Committee X12 (ASC X12) (http://www.x12.org).
     Health Level Seven, Inc. (HL 7) (http://www.hl7.org).
     National Council for Prescription Drug Programs (NCPDP) 
(http://www.ncpdp.org).
     National Uniform Billing Committee (NUBC) (http://www.nubc.org).
     National Uniform Claim Committee (NUCC) (http://www.nucc.org).
     Dental Content Committee of the American Dental 
Association (http://www.ada.org).
    The six organizations signed a Memorandum of Understanding (MOU) 
agreeing to undertake the functions specified in Sec. 162.910 and to 
follow a framework of cooperation with each other and HHS. The initial 
term of the MOU is 3 years and is automatically renewed for subsequent 
1-year periods. The MOU document sets forth a general process to be 
followed by the DSMOs when a request is made to change the HIPAA 
standards. The DSMOs designated a steering committee to facilitate 
implementation of the MOU. In order to manage the change request 
process, the signatory organizations agreed to:
     Allow open public access
     Provide for timely review
     Cooperate and communicate
     Consider all viewpoints
     Evaluate the impact of each change request
     Maintain a national perspective
     Conform to law
    A web site (http://www.hipaa-dsmo.org) was established for 
requesting changes. For additional information regarding the general 
change request management process, see the MOU document which is 
available at: www.hipaa-dsmo.org/mou.pdf.
    After the initial standards were adopted in the Transactions Rule, 
a significant number of change requests were submitted through the DSMO 
process. Many of those change requests were for changes that were 
considered by the submitters to be essential to permit initial 
implementation of the standards throughout the entire healthcare 
industry. Those essential changes address specific details or elements 
within the implementation specifications.
    You can review all change requests reviewed by the DSMOs and sent 
to NCVHS for adoption as addenda to the final rule at http://hipaa-dsmo.org/crs/fasttrack.pdf. (Nonessential changes are still addressed 
by the general change request management process set forth in the MOU.) 
The procedure for electronically submitting change requests to the 
DSMOs and specific details on submitted requests such as business needs 
and disposition are available at the DSMO change request web site: 
http://www.hipaa-dsmo.org.
    The DSMOs as a group presented their list of proposed modifications 
that they judged essential for implementation to the NCVHS. The NCVHS 
held public hearings on those proposed changes (transcripts of those 
hearings are available at http://www.ncvhs.hhs.gov). The NCVHS made its 
own determination about the modification requests and recommended that 
the Secretary adopt all of the changes proposed by the DSMOs as 
modifications to the national standards.

II. Provisions of the Proposed Regulations

    The Secretary reviewed the changes recommended by the NCVHS and is 
proposing their adoption in this rule.

A. Summary

    This rule proposes to make some limited technical modifications to 
some of the transactions standards, specifically the implementation 
specifications, adopted in the Transactions Rule by adopting those 
changes identified by the DSMOs, and approved by the NCVHS, as 
necessary to permit initial implementation of the standards within the 
industry. Details of the proposed modifications are not set forth 
specifically in this document, but are available at http://hipaa-dsmo.org/crs/fasttrack.pdf. A summary of those details follows:
    A total of 231 change requests were submitted to the DSMOs for 
consideration. 85 requests were rejected because the implementation 
specifications already met the specified business need, or the business 
need was not well substantiated. 21 requests were recommended for 
future changes. 6 requests were withdrawn by the submitter. 7 requests 
were referred to the Department as policy issues. The remaining 115 
change requests were approved and are included in the draft addenda. 
They fell into 2 categories--48 maintenance changes (minor error 
corrections, clarifications) and 67 modifications to the standards. 
Details of these 67 modifications include:
     Changing required data elements to situational (about 20 % 
of changes) Submitters pointed out several data elements that were 
required by the original standards, but were really only needed in some 
situations. These data

[[Page 38053]]

elements were made situational in the addenda, with clearly defined 
situations. Examples are:
    1. Provider Taxonomy codes on claims-many health plans store this 
information on their systems when providers enroll, so there is no need 
to continually send this information. The code will now only be 
reported ``when adjudication is known to be impacted by the code.''
    2. Date last seen by physician (used for certain physical therapy 
claims)--this is only needed by Medicare, so usage was changed from 
required on all claims to ``required on Medicare claims.''
     Removal of certain data elements (about 20% of changes)
    Several data elements were removed since they do not appear to be 
needed.
    Examples are:
    1. Referral date
    2. Estimated date of birth
     Allowing certain items to be reported via external code 
sets rather than data elements in the transaction (about 20% of 
changes)
    There were several instances where codes could be used to indicate 
certain data elements. This will allow external code set organizations 
to easily update codes and reporting, as opposed to having the DSMOs 
make changes to the standards.

    Examples are:
    1. Special program indicator codes
    2. Newborn birth weights
     Adding additional functionality to some transactions 
(about 40% of changes) Requestors suggested several additional data 
elements, codes, or loops to enable them to do certain business 
functions in the transactions. These include:
    1. Cross-referencing two subscriber IDs (surviving spouse and 
dependents)
    2. Sending a patient's primary care physician number

The DSMOs and the NCVHS determined that these proposed modifications 
would respond to industry requests for changes that would facilitate 
HIPAA implementation.
    The SSOs have incorporated the proposed modifications for each 
transaction into draft addenda for each implementation specification. 
These draft addenda represent the final product of the DSMO change 
request process, in that the requested change successfully completed 
the DSMO change request process in the form of proposed draft addenda 
to the adopted implementation specifications. As previously discussed, 
the original implementation specifications are incorporated by 
reference. This rule proposes to adopt the modifications in the draft 
addenda. The addenda would be incorporated by reference just as are the 
original implementation specifications. We are are soliciting comments 
specifically on those modifications found in the draft addenda. 
Comments may be submitted for specific individual proposed 
modifications or for the proposed modifications collectively. The full 
text of the draft addenda can be obtained from the Washington 
Publishing Company, PMB 161, 5284 Randolph Road, Rockville, Md., 20852-
2116; telephone 301-949-9740. They are also available through the 
Washington Publishing Company on the Internet at http://hipaa.wpc-edi.com/HIPAAAddenda_40.asp.

B. Proposed Modifications

    The Transactions Rule established standards for eight electronic 
transactions, including, when appropriate, specific standards tailored 
to specific industry sectors, for example, retail pharmacy, 
institutional, and professional. The modifications proposed here would 
affect some of the transaction standards (identified below). The new 
standards would consist of the implementation guide plus the addenda. 
The addenda are identified below:
    1. Health care claims or equivalent encounter information 
(Sec. 162.1102).
    a. Dental Health Care Claims. The ASC X12N Addenda to Health Care 
Claim: Dental, Version 4010, May 2000, Washington Publishing Company, 
004010X097A1 (NPRM Draft Addenda October 2001).
    b. Professional Health Care Claims. The ASC X12N Addenda to Health 
Care Claim: Professional, Volumes 1 and 2, Version 4010, May 2000, 
Washington Publishing Company, 004010X098A1 (NPRM Draft Addenda October 
2001).
    c. Institutional Health Care Claims. The ASC X12N Addenda to Health 
Care Claim: Institutional, Volumes 1 and 2, Version 4010, May 2000, 
Washington Publishing Company, 004010X096A1 (NPRM Draft Addenda October 
2001).
    2. Eligibility for a health plan (Sec. 162.1202).
    Dental, professional, and institutional. The ASC X12N Addenda to 
Health Care Eligibility Benefit Inquiry and Response, Version 4010, May 
2000, Washington Publishing Company, 004010X092A1 (NPRM Draft Addenda 
October 2001).
    3. Referral certification and authorization (Sec. 162.1302).
    The ASC X12N Addenda to Health Care Services Review-Request for 
Review and Response, Version 4010, May 2000, Washington Publishing 
Company, 004010X094A1 (NPRM Draft Addenda October 2001). In the 
proposed rule titled CMS-0003-P, published elsewhere in this Federal 
Register issue, we are proposing to add a new paragraph (a) to this 
section.
    4. Health care claim status (Sec. 162.1402).
    The ASC X12N Addenda to Health Care Claim Status Request and 
Response, Version 4010, May 2000, Washington Publishing Company 
004010X093A1 (NPRM Draft Addenda October 2001).
    5. Enrollment and disenrollment in a health plan (Sec. 162.1502).
    The ASC X12N Addenda to Benefit Enrollment and Maintenance, Version 
4010, May 2000, Washington Publishing Company 004010X095A1 (NPRM Draft 
Addenda October 2001).
    6. Health care payment and remittance advice (Sec. 162.1602).
    a. Dental, professional, and institutional health care claims and 
remittance advice. The ASC X12N Addenda to Health Care Claim Payment/
Advice, Version 4010, May 2000, Washington Publishing Company, 
004010X091A1 (NPRM Draft Addenda October 2001).

C. Compliance Dates

    The compliance date for the standards for the transactions adopted 
in the Transactions Rule is October 16, 2002 for covered entities, with 
the exception of small health plans, for which the compliance date is 
October 16, 2003 (65 FR 50368). Under Sec. 160.104, the Secretary 
establishes the compliance date for modifications. The date must not be 
earlier than 180 days after the adoption date of the modification.
    The Administrative Simplification Compliance Act (Pub. L. 107-105) 
was enacted on December 27, 2001. This law provides an extension to the 
compliance dates adopted in the Standards for Electronic Transactions 
final rule of August 17, 2000 (65 FR 50368), for covered entities, with 
the exception of small health plans, that submit a plan to the 
Secretary of Health and Human Services indicating how the entity will 
come into compliance by October 16, 2003. This plan must be submitted 
to the Secretary before October 16, 2002. Entities that obtain such an 
extension will also have a corresponding extension of the compliance 
dates set forth in this proposed rule.

III. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide a 60-day notice in the Federal Register and solicit public 
comment before a collection of information requirement is

[[Page 38054]]

submitted to the Office of Management and Budget (OMB) for review and 
approval. In order to fairly evaluate whether an information collection 
should be approved by OMB, section 3506(c)(2)(A) of the Paperwork 
Reduction Act of 1995 (PRA) requires that we solicit comment on the 
following issues:
     The need for the information collection and its usefulness 
in carrying out the proper functions of our agency.
     The accuracy of our estimate of the information collection 
burden.
     The quality, utility, and clarity of the information to be 
collected.
     Recommendations to minimize the information collection 
burden on the affected public, including automated collection 
techniques.
    The collection of information requirements associated with the 
transaction regulation are currently approved by OMB under OMB approval 
number 0938-0866. We are soliciting public comments on each of the 
above issues for the information collection requirements (ICRs) 
contained in the sections covered by this proposed rule.
    If you comment on these information collection and recordkeeping 
requirements, please mail copies directly to the following:

Centers for Medicare & Medicaid Services,
Office of Information Services,
DCES, SSG,
Attn: John Burke,
Room N2-14-26, 7500 Security Boulevard,
Baltimore, MD 21244-1850; and
Office of Information and Regulatory Affairs,
Office of Management and Budget,
Room 10235, New Executive Office Building,
Washington, DC 20503,
Attn: Brenda Aguilar, CMS Desk Officer.

IV. Response to Comments

    Because of the large number of items of correspondence we normally 
receive on Federal Register documents published for comment, we are not 
able to acknowledge or respond to them individually. We will consider 
all comments we receive by the date and time specified in the DATES 
section of this preamble, and, if we proceed with a subsequent 
document, we will respond to the major comments in the preamble to that 
document.

IV. Regulatory Impact Analysis

    We have examined the impact of this rule as required by Executive 
Order 12866 (September 1993, Regulatory Planning and Review) and the 
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354). 
Executive Order 12866 directs agencies to assess all costs and benefits 
of available regulatory alternatives and, if regulation is necessary, 
to select regulatory approaches that maximize net benefits (including 
potential economic, environmental, public health and safety effects, 
distributive impacts, and equity). A regulatory impact analysis (RIA) 
must be prepared for major rules with economically significant effects 
($100 million or more annually). An impact analysis was published in 
the Standards for Electronic Transactions final rule of August 17, 2000 
(65 FR 50350). This analysis detailed the significant costs and 
benefits of adopting standard electronic transactions and codes sets. 
The analysis assumed that the adopted standards would be able to be 
implemented successfully by the industry. The changes in this proposed 
rule are a result of industry analyses that showed certain minor 
modifications in the adopted standards would be necessary to permit 
industry compliance with the standards. These modifications would make 
limited adjustments and corrections to the overall standards and would 
facilitate the Congressional intent of implementation of national 
electronic standards. Thus, the impact analysis previously published 
would reflect industry experience if the changes proposed in this rule 
are adopted.
    In relation to the prior impact analysis, this rule would impose no 
additional burdens and create no additional costs. All of the proposed 
changes in this rule are required to facilitate successful 
implementation of the standards. Their implementation would, in fact, 
avoid costs that were not anticipated in the initial impact analysis. 
Therefore, no additional impact analysis under Executive Order 12866 is 
required.
    It is estimated that substantial costs would incur for the health 
care industry without the adoption of these proposed changes. The 
proposed changes eliminate the need for expensive computer system 
changes, and in some cases, facilitate an implementation that might not 
have been possible without the proposed changes. The industry has 
approved these proposed changes as an essential component to their 
HIPAA implementation.
    A total of 231 change requests were submitted to the DSMOs for 
consideration. 85 requests were rejected because the implementation 
specifications already met the specified business need, or the business 
need was not well substantiated. 21 requests were recommended for 
future changes. 6 requests were withdrawn by the submitter. 7 requests 
were referred to the Department as policy issues. The remaining 115 
change requests were approved and are included in the draft addenda. 
They fell into 2 categories -48 maintenance changes (minor error 
corrections, clarifications) and 67 modifications to the standards. 
Details of these 67 modifications include:
     Changing required data elements to situational (about 20% 
of changes)
    Submitters pointed out several data elements that were required by 
the original standards, but were really only needed in some situations. 
These data elements were made situational in the addenda, with clearly 
defined situations. Examples are:
    1. Provider Taxonomy codes on claims--many health plans store this 
information on their systems when providers enroll, so there is no need 
to continually send this information. The code will now only be 
reported ``when adjudication is known to be impacted by the code.''
    2. Date last seen by physician (used for certain physical therapy 
claims)--this is only needed by Medicare, so usage was changed from 
required on all claims to ``required on Medicare claims.''
     Removal of certain data elements (about 20% of changes)
    Several data elements were removed since they do not appear to be 
needed.
    Examples are:
    1. Referral date.
    2. Estimated date of birth.
     Allowing certain items to be reported via external code 
sets rather than data elements in the transaction (about 20% of 
changes)
    There were several instances where codes could be used to indicate 
certain data elements. This will allow external code set organizations 
to easily update codes and reporting, as opposed to having the DSMOs 
make changes to the standards.
    Examples are:
    1. Special program indicator codes.
    2. Newborn birth weights.
     Adding additional functionality to some transactions 
(about 40% of changes)
    Requestors suggested several additional data elements, codes, or 
loops to enable them to do certain business functions in the 
transactions. These include:
    1. Cross-referencing two subscriber IDs (surviving spouse and 
dependents).
    2. Sending a patient's primary care physician number.
    These changes recognize that several pieces of information 
initially required

[[Page 38055]]

by the standards were unduly burdensome to collect, so have been 
changed to only be collected in a more limited set of circumstances.
    One particular example is that of the provider information to be 
collected for each service on a hospital claim. The initial standards 
required that this information be collected if the provider is 
different for each service (which it usually is in a hospital--
radiologists read x-rays, physical therapists provide therapy, etc.). 
Many hospitals said that their systems do not routinely collect the 
different providers for each claim, that this information is not 
currently used by health plans for processing most claims, and it would 
be extremely burdensome to collect such information.
    As a result, the condition under which this information was 
collected was revised in the implementation guide to state ``Required 
when the line level information is known to impact adjudication''. This 
will substantially reduce the number of claims for which this 
information needs to be collected.
    There are other examples of data elements that have been removed or 
will be required under more limited circumstances.
    The RFA requires agencies to determine whether a rule will have a 
significant economic impact on a substantial number of small entities. 
On November 17, 2000, the Small Business Administration (SBA) published 
a final rule (65 FR 69432) changing the small business size standards 
for the health care industry. This SBA final rule became effective 
December 18, 2000. The size standards that the SBA now uses are those 
defined by the North American Industry Classification System. Before 
that, the SBA used size standards as defined by the Standard Industrial 
Codes. The size standard is no longer a uniform $5 million in annual 
revenues for all components in the health care sector. Rather, the size 
standard now ranges from $6 million to $29 million. The regulatory 
flexibility analysis for this proposed rule is linked to the aggregate 
regulatory flexibility analysis for all the Administrative 
Simplification standards that appeared in the final rule on Standards 
for Electronic Transactions (65 FR 50312), published on August 17, 
2000, which predated the SBA change. It is appropriate, for purposes of 
this proposed rule, to continue to use the $5 million small business 
size standard that was in effect at the time of publication of the 
final rule on Standards for Electronic Transactions. Nonprofit 
organizations are considered small entities. Small government 
jurisdictions with a population of less than 50,000 are considered 
small entities. Individuals and States are not considered small 
entities. Most hospitals and most other providers and suppliers are 
small entities, either by nonprofit status or by having revenues of $5 
million or less annually. For purposes of the RFA, all retail 
pharmacies are considered to be small entities. We have determined that 
this proposed rule would not have a significant economic impact on a 
substantial number of small entities.
    In addition, section 1102(b) of the Act requires us to prepare a 
regulatory impact analysis if a rule may have a significant impact on 
the operations of a substantial number of small rural hospitals. This 
analysis must conform to the provisions of section 603 of the RFA. For 
purposes of section 1102(b) of the Act, we define a small rural 
hospital as a hospital that is located outside of a Metropolitan 
Statistical Area and has fewer than 100 beds. We have determined that 
this proposed rule would not have a significant impact on a substantial 
number of small rural hospitals. Section 202 of the Unfunded Mandates 
Reform Act of 1995 also requires that agencies assess anticipated costs 
and benefits before issuing any rule that may result in an expenditure 
in any 1 year by State, local, or tribal governments, in the aggregate, 
or by the private sector, of $110 million. This rule would have no 
mandated consequential effect on State, local, or tribal governments, 
or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on State 
and local governments, preempts State law, or otherwise has Federalism 
implications. We have determined that this proposed rule would not 
significantly affect the rights, roles and responsibilities of States.
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

List of Subjects in 45 CFR Part 162

    Administrative practice and procedure, Electronic transactions, 
Health facilities, Health insurance, Hospitals, Incorporation by 
reference, Medicare, Medicaid, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, the Department of Health 
and Human Services would amend 45 CFR subtitle A, subchapter C, part 
162 as follows:

PART 162--ADMINISTRATIVE REQUIREMENTS

    1. The authority citation for part 162 continues to read as 
follows:

    Authority: Secs. 1171 through 1179 of the Social Security Act 
(42 U.S.C. 1320d--1320d-8), as added by sec. 262 of Pub. L. 104-191, 
110 Stat. 2021-2031, and sec. 264 of Pub. L. 104-191, 110 Stat. 
2033-2034 (42 U.S.C. 1320d-2 (note)).

    2. Revise Sec. 162.1102 (b), (c) and (d) to read as follows:


Sec. 162.1102  Standards for health care claims or equivalent encounter 
information.

* * * * *
    (b) Dental Health Care Claims. The ASC X12N 837-Health Care Claim 
Dental, Version 4010, May 2000, Washington Publishing Company, 
004010X097 and Addenda to Health Care Claim Dental, Version 4010, 
October 2001, Washington Publishing Company, 004010X097A1. The 
implementation specification is available at addresses specified in 
Sec. 162.920(a)(1).
    (c) Professional Health Care Claims. The ASC X12N 837-Health Care 
Claim: Professional, Volumes 1 and 2, version 4010, May 2000, 
Washington Publishing Company, 004010X098 and Addenda to Health Care 
Claim: Professional, Volumes 1 and 2, version 4010, October 2001, 
Washington Publishing Company, 004010X098A1. The implementation 
specification is available at the address specified in 
Sec. 162.920(a)(1).
    (d) Institutional Health Care Claims. The ASC X12N 837-Health Care 
Claim: Institutional, Volumes 1 and 2, Version 4010, May 2000, 
Washington Publishing Company, 004010X096 and Addenda to Health Care 
Claim: Institutional, Volumes 1 and 2, Version 4010, October 2001, 
Washington Publishing Company, 004010X096A1. The implementation 
specification is available at the addresses specified in 
Sec. 162.920(a)(1).
    3. Revise Sec. 162.1202(b) to read as follows:


Sec. 162.1202  Standards for eligibility for a health plan.

* * * * *
    (b) Dental, professional, and institutional. The ASC X12N 270/271-
Health Care Eligibility Benefit Inquiry and Response, Version 4010, May 
2000, Washington Publishing Company, 004010X092 and Addenda to Health 
Care Eligibility Benefit Inquiry and Response, Version 4010, October 
2001, Washington Publishing Company, 004010X092A1. The implementation 
specification is available at the addresses specified in 
Sec. 162.920(a)(1).
* * * * *

[[Page 38056]]

    4. Revise Sec. 162.1302 to read as follows:


Sec. 162.1302  Standard for referral certification and authorization.

    The Secretary adopts the following standards for the referral 
certification and authorization transaction:
    (a) [Reserved]
    (b) Dental, professional, and institutional referral certification 
and authorization. The Secretary adopts the ASC X12N 278-Health Care 
Services Review-Request for Review and Response, Version 4010, May 
2000, Washington Publishing Company, 004010X094 and Addenda to Health 
Care Services Review-Request for Review and Response, Version 4010, 
October 2001, Washington Publishing Company, 004010X094A1 as the 
standard for the referral certification and authorization transaction. 
The implementation specification is available at the addresses 
specified in Sec. 162.920(a)(1).
    5. Revise Sec. 162.1402 to read as follows:


Sec. 162.1402  Standard for health care claims status.

    The Secretary adopts the ASC X12N-276/277 Health Care Claim Status 
Request and Response, Version 4010, May 2000, Washington Publishing 
Company, 004010X093 and Addenda to Health Care Claim Status Request and 
Response, Version 4010, October 2001, Washington Publishing Company, 
004010X093A1 as the standard for the health care claim status 
transaction. The implementation specification is available at the 
addresses specified in Sec. 162.920(a)(1).
    6. Revise Sec. 162.1502 to read as follows:


Sec. 162.1502  Standard for enrollment and disenrollment in a health 
plan.

    The Secretary adopts the ASC X12N 834-Benefit Enrollment and 
Maintenance, Version 4010, May 2000, Washington Publishing Company, 
004010X095 and Addenda to Benefit Enrollment and Maintenance, Version 
4010, October 2001, Washington Publishing Company, 004010X095A1 as the 
standard for enrollment and disenrollment in a health plan transaction. 
The implementation specification is available at the addresses 
specified in Sec. 162.920(a)(1).
    7. Revise Sec. 162.1602(b) to read as follows:


Sec. 162.1602  Standards for health care payment and remittance advice.

* * * * *
    (b) Dental, professional, and institutional health care claims and 
remittance advice. The ASC X12N 835-Health Care Claim Payment/Advice, 
Version 4010, May 2000, Washington Publishing Company, 004010X091 and 
Addenda to Health Care Claim Payment/Advice, Version 4010, October 
2001, Washington Publishing Company, 004010X091A1. The implementation 
specification is available at the addresses specified in 
Sec. 162.920(a)(1).

(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)

    Dated: March 20, 2002.
Tommy G. Thompson,
Secretary.
[FR Doc. 02-13615 Filed 5-24-02; 4:53 pm]
BILLING CODE 4120-01-P