[Federal Register Volume 67, Number 191 (Wednesday, October 2, 2002)]
[Rules and Regulations]
[Pages 61808-61814]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-25096]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 482, 483, and 484

[CMS-3160-FC]
RIN 0938-AM00


Medicare and Medicaid Programs; Conditions of Participation: 
Immunization Standards for Hospitals, Long-Term Care Facilities, and 
Home Health Agencies

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Final rule with comment period.

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SUMMARY: The provisions of this final rule will remove the Federal 
barrier related to the requirement for a physician to order influenza 
and pneumococcal immunizations in Medicare and Medicaid participating 
hospitals, long-term care facilities, and home health agencies. This 
final rule will affect vaccine-preventable diseases and will help 
improve adult vaccination coverage rates. It will facilitate the 
delivery of appropriate vaccinations in a timely manner, increase the 
levels of vaccination coverage, and decrease the morbidity and 
mortality rate of influenza and pneumococcal diseases.

DATES: Effective date: These regulations are effective on October 2, 
2002.
    Comment date: Comments will be considered if we receive them at the 
appropriate address, as provided below, no later than 5 p.m. on 
December 2, 2002.

ADDRESSES: In commenting, please refer to file code CMS-3160-FC. 
Because of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission or e-mail.
    Mail written comments (one original and three copies) to the 
following address only: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-3160-FC, P.O. 
Box 8013, Baltimore, MD 21244-8013.

[[Page 61809]]

    Please allow sufficient time for mailed comments to be received 
timely 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. (Because access to the interior of 
the HHH Building is not readily available to persons without Federal 
Government identification, commenters are encouraged to leave their 
comments in the CMS drop slots located in the main lobby of the 
building. A stamp-in clock is available for commenters wishing to 
retain a proof of filing by stamping in and retaining an extra copy of 
the comments being filed.) Comments mailed to the addresses indicated 
as appropriate for hand or courier delivery may be delayed and could be 
considered late.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Anita Panicker, RN, MS, LCSW, (410) 
786-5646. Jeannie Miller, RN, (410) 786-3164.

SUPPLEMENTARY INFORMATION:

Inspection of Public Comments

    Comments received timely will be available for public inspection as 
they are received, generally beginning approximately three 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, call (410) 
786-7197.

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I. Background

A. Conditions of Participation: Immunization Standards for Hospitals, 
Long-Term Care Facilities, and Home Health Agencies

1. Influenza and Related Conditions
    Influenza and pneumonia combined represent the fifth leading cause 
of death in the elderly. The 1999 RAND report prepared for the Centers 
for Medicare & Medicaid Services (CMS), ``Interventions that Increase 
the Utilization of Medicare-Funded Preventive Services for Persons Age 
65 and Older,'' states that ``influenza and consequent respiratory 
diseases are common causes of morbidity and mortality in the United 
States each year, with 20,000 to 40,000 deaths reported for each 
influenza epidemic. Over 90 percent of these deaths occur among those 
age 65 or older.'' The report also states that influenza vaccination 
``has been shown to be efficacious in the elderly, decreasing 
hospitalizations by 27 percent to 57 percent and deaths by 27 percent 
to 30 percent.'' (http://www.cms.hhs.gov/healthyaging/2a.asp.)
    The Center for Health Research, a part of the Kaiser Permanente 
managed care organization, studied the cost-effectiveness of influenza 
vaccination over nine flu seasons in its northwest region in a study 
published in 1993. The study examined experiences of some 69,000 
elderly members of the health maintenance organization who experienced 
3,105 outpatient pneumonia and influenza episodes, 894 
hospitalizations, and 113 pneumonia and influenza deaths. The estimated 
cost of providing a vaccination was $7.11; average medical care costs 
for outpatient and inpatient episodes were $106 and $5,730, 
respectively, for high-risk elderly patients, and $141 and $4,477 for 
non-high-risk elderly patients. A similar study examined the cost-
effectiveness of vaccinating elderly members of a Minnesota health plan 
against influenza over three seasons beginning in 1990. The plan, Group 
Health Inc. of Minneapolis, vaccinated 45 percent to 58 percent of its 
members over age 64. Vaccinated individuals had lower hospitalization 
rates for flu, pneumonia, congestive heart failure, and other illness, 
for an average savings of $117 per vaccinated member. (``The costly 
toll of vaccine-preventable disease.'' Business and Health; Montvale; 
1995; (13)(3)16; Leavenworth, Geoffrey.)
    Despite the availability of safe and effective vaccines and 
substantial progress in reducing vaccine-preventable diseases, 
improving the delivery of the vaccines is vital to further reduce and 
eliminate vaccine-preventable causes of morbidity and mortality. The 
administration of influenza and pneumococcal polysaccharide vaccines 
per standing orders, governed by the physician-approved policies and 
procedures of the facility or agency, after assessments for 
contraindications, is the most consistently effective method for 
increasing adult vaccination rates and the least burdensome to 
implement.
    Influenza vaccine is the primary method for preventing influenza 
and its more severe complications. The Advisory Committee on 
Immunization Practices (ACIP) reported in 2002 that the primary target 
group for influenza vaccination includes persons who are at high risk 
for serious complications from influenza, including approximately 35 
million persons who are more than 65 years of age, and approximately 33 
to 39 million persons less than 65 who have chronic underlying medical 
conditions. Beginning with the 2000 to 2001 influenza season, the ACIP 
has added persons aged 50 to 64 years to the primary target group for 
annual influenza vaccination. This age group was added because a 
substantial proportion of persons aged 50 to 64 years (estimated at 
between 24 percent and 32 percent of the total population) have one or 
more chronic medical conditions that place them at high risk for 
influenza-related hospitalization and death. Rates of influenza-related 
excess hospitalization among adults younger than age 65 years old with 
one or more high-risk conditions have been estimated at 392 to 635 per 
100,000 persons compared with 13 to 23 per 100,000 among those without 
high-risk conditions. There are minimal adverse reactions or side 
effects related to influenza vaccines because, as the Morbidity and 
Mortality Weekly Report (MMWR) states, ``inactivated influenza vaccine 
contains noninfectious killed viruses and cannot cause influenza.'' The 
most frequent side effect of vaccination is soreness at the vaccination 
site that lasts less than 2 days. Fever, malaise, myalgia, and other 
systemic symptoms can occur but recent placebo-controlled trials 
demonstrate that among older persons and healthy

[[Page 61810]]

young adults, administration of split-virus influenza vaccine is not 
associated with higher rates of such systemic symptoms when compared 
with placebo injections. The potential benefits of influenza 
vaccination in preventing serious illness, hospitalization, and death 
greatly outweigh the vaccine reactions. (``Prevention and control of 
influenza: recommendations of the Advisory Committee on Immunization 
Practices (ACIP).'' MMWR 51; RR03, (April 12, 2002) (``ACIP 
Recommendations'')). The availability of safe and effective vaccines 
and substantial progress in the direction of reducing vaccine-
preventable diseases has not produced the expected outcome, due to the 
lack of proper delivery in a timely manner to the targeted populations.
    The Centers for Medicare & Medicaid Services and the Centers for 
Disease Control and Prevention (CDC) recognize the major impact of both 
influenza and pneumococcal disease on the residents of long-term care 
facilities, and the effectiveness of vaccines in reducing health care 
costs by preventing illness and hospitalization, and have collaborated 
to improve immunization coverage through standing orders. The goal is 
to immunize at least 90 percent of the institutionalized population to 
meet our Healthy People 2010 objectives through a national quality 
improvement program and to promote standing orders for immunization 
programs to ensure that all nursing facility residents are assessed for 
and offered influenza and pneumococcal vaccinations. (For more 
information on our Healthy People 2010 immunization goals and health 
objectives for the nation, in general, please see http://www.health.gov/healthypeople.) Standing orders programs authorize 
licensed practitioners, where allowed by State law, to administer 
vaccinations, after assessment for contraindications, according to a 
physician-approved facility or agency policy without the need for a 
physician's order. One of the key findings of the 1999 RAND report is 
that organizational changes are effective in improving the delivery of 
preventive services. Standing orders are a type of organizational 
change that allow appropriate non-physician staff to offer 
vaccinations, after assessment for contraindications, without an 
individual physician order, according to the facility or agency policy. 
The ACIP recommends implementing standing orders in nursing homes and 
hospitals. We have included home health agencies (HHAs) in this rule as 
providing vaccines in settings accessible to adults is critical and the 
need to use transportation to reach a health-care provider is a barrier 
to receiving preventive services. This barrier may be eliminated by 
offering vaccines in such convenient locations as homes, where HHAs 
already provide other services.
2. Why a Change in the Conditions of Participation Is Needed
    The Conditions of Participation (CoPs) are Federal requirements 
that establish basic health and safety standards that providers of 
health care services, such as hospitals and LTCFs, must meet in order 
to participate in the Medicare and Medicaid programs. However, the 
protection afforded by the Medicare and Medicaid CoPs apply to all 
patients regardless of payer source. Although the goal of the changes 
to the CoPs is to increase adult immunizations, the changes brought 
about by this rule could also be used by hospitals, HHAs, and LTCFs to 
implement immunization policies to improve flu and pneumonia 
immunization rates for children and adolescents.
    The provisions of the final rule will remove the Federal barrier 
related to the physician's order requirement for influenza and 
pneumococcal immunizations in Medicare and Medicaid participating 
hospitals, long-term care facilities (LTCFs), and HHAs. Preventing 
morbidity and mortality due to severe influenza and its complications 
is one of the goals of this regulation. During the influenza season, 
hospitalization rates for high-risk populations increase two to five-
fold, depending on the age group. Influenza-associated mortality is a 
major concern for persons with chronic diseases; this mortality 
increase is most marked in persons 65 years of age or older, with more 
than 90 percent of the deaths attributed to pneumonia and influenza 
occurring in persons of this age group. (``Prevention and Control of 
Influenza Indications for Influenza Vaccine.'' Disease Prevention News, 
Vol. 57, No. 20, September 20, 1997.) The proportion of elderly persons 
in the U.S. population is increasing, and age and its associated 
chronic diseases can increase the severity of influenza illness. Unless 
control measures are more vigorously implemented, the number of deaths 
from influenza and its complications is expected to increase.
    According to the article, each year, more people die of 
pneumococcal pneumonia alone than die of breast cancer and AIDS 
combined. According to the CDC, an estimated 40,000 deaths annually in 
the United States are attributed to pneumococcal infection. 
Immunization of high-risk persons could prevent up to half of these 
deaths. As of 1993, Medicare began reimbursing providers for influenza 
vaccine and its administration (http://cms.hhs.gov/preventiveservices/2a.asp). However, only 23 percent of one of the highest-risk groups, 
persons aged 65 years and older, had received vaccination against 
pneumococcal disease. Section 4107 of the Balanced Budget Act of 1997 
``extended the influenza and pneumococcal vaccination campaign 
conducted by CMS in conjunction with CDC and the National Coalition for 
Adult Immunization through fiscal year 2002, authorizing $8 million for 
each fiscal year from 1998 to 2002.'' Even with these changes in 
Medicare reimbursements, the rates of immunization did not improve as 
anticipated. A tragic example of these national trends occurred in 
Texas. In January 1997, a local health department alerted the Texas 
Department of Health to three laboratory-confirmed Streptococcal 
pneumoniae infections at a Northeast Texas nursing home with 90 
residents. Pneumococcal vaccine had been administered to only 10 (11 
percent) of the residents before the outbreak. The remaining nursing 
home residents were promptly vaccinated and given antibiotics to 
prevent further cases. However, two of the three patients with 
laboratory-confirmed infections died. A decade of use has confirmed the 
efficacy and safety of the current vaccine against pneumococcal 
disease. Moreover, the vaccine is inexpensive, and Medicare reimburses 
its cost.
    In summary, immunizations save lives and can help avoid needless 
suffering and unnecessary costs caused by complications from various 
infectious diseases, and, as many family members and health care 
workers know, they can prevent the infection of others. However, 
despite the availability of safe and effective vaccines, substantial 
portions of susceptible adults are not being immunized. Our report in 
2000 on the 1999 data indicate that 35 percent of the population age 65 
or older has received the pneumococcal vaccine and 45 percent of the 
population age 65 or older has been immunized against the flu (http://cms.hhs.gov/preventiveservices/2d.asp). To reduce the morbidity and 
mortality rates, delivering appropriate vaccinations in a timely manner 
is vital. Maintaining high levels of vaccination coverage and low rates 
of vaccine-preventable diseases is the goal of this final rule. 
Standing orders will decrease vaccine-preventable diseases and improve 
adult

[[Page 61811]]

vaccination rates because they are the most consistently effective 
method for increasing adult vaccination rates and are easy to 
implement.
    The report on ``Use of Standing Orders Programs to Increase Adult 
Vaccination Rates'' (MMWR 2000/49 RR01 15-26, March 24, 2000) (Standing 
Orders Report)), briefly reviews the evidence on the effectiveness of 
standing orders programs, describes standards for program 
implementation, and recommends initiating these programs to improve 
immunization coverage in several traditional and nontraditional 
settings. The report states that in recent years, a rapid emergence of 
antimicrobial resistance among pneumococci, especially to penicillin, 
has occurred. Increasing pneumococcal vaccination rates could help 
prevent invasive pneumococcal disease caused by vaccine-type, 
multidrug-resistant pneumococci. Outbreaks of pneumococcal disease 
caused by a single drug-resistant pneumococcal serotype have occurred 
in institutional settings, including nursing homes. The same MMWR 
report states that in 1999, because of concerns about pneumococcal 
antimicrobial resistance and underuse of pneumococcal vaccine, the 
American Medical Association and several partner organizations issued a 
Quality Care Alert that supports ACIP's recommendations for 
pneumococcal vaccination.

II. Provisions of the Final Rule

A. Conditions of Participation: Immunization Standards for Hospitals, 
Long-Term Care Facilities, and Home Health Agencies

    The provisions of the final rule will remove the Federal barrier 
related to the physician's order requirement for influenza and 
pneumococcal immunizations in Medicare and Medicaid participating 
hospitals, LTCFs and HHAs, that have such a requirement. In developing 
a facility or agency policy for immunizing patients/residents, there 
must be input from the medical director or a physician. We discuss 
examples of core aspects of facility policy under the direction of the 
medical director or a physician below. However, this policy is not 
limited to these examples, and the specific circumstances of each 
beneficiary must be taken into account.
    The most basic and vital aspect of facility policy must be patient 
assessment. Patient assessment is a mandatory element of professional 
practice standards for any procedure performed. This requirement, 
therefore, is not an exception, or a new practice even though we wish 
to emphasize its importance here. Assessment of possible 
contraindications must be carried out before vaccines are administered. 
Inactivated influenza vaccine should not be administered, for example, 
to persons known to have anaphylactic hypersensitivity to eggs, or to 
other components of the influenza vaccine, without first consulting a 
physician. Prophylactic use of antiviral agents is an option for 
preventing influenza among these persons. However, persons who have a 
history of anaphylactic hypersensitivity to vaccine components but who 
are also at high risk for complications from influenza can benefit from 
the vaccine after appropriate allergy evaluation and desensitization. 
Information regarding vaccine components can be found in package 
inserts from each manufacturer. Similarly, persons with acute febrile 
illness usually should not be vaccinated until their symptoms have 
abated. However, minor illnesses with or without fever do not 
contraindicate the use of the influenza vaccine, particularly among 
children with mild upper respiratory tract infection or allergic 
rhinitis (ACIP Recommendations). The Standing Orders Report states that 
standing orders protocols should also specify that vaccines be 
administered by healthcare professionals trained to (a) screen patients 
for contraindications to vaccination, (b) administer vaccines, and (c) 
monitor patients for adverse events, in accordance with State and local 
regulations.
1. Hospitals
    We are changing the current requirements in the first sentence of 
our condition of participation for hospitals, at 42 CFR. 482.23(c)(2), 
to read ``All orders for drugs and biologicals must be in writing and 
signed by the practitioner or practitioners responsible for the care of 
the patient as specified under Sec.  482.12(c) with the exception of 
influenza and pneumococcal polysaccharide vaccines, which may be 
administered per physician-approved hospital policy after an assessment 
for contraindications.''
    The September 2000 issue of the Journals of Gerontology includes an 
article that refers to a study that reviewed hospitals' data on 
influenza vaccination rates among hospitalized older adults that showed 
that in-hospital influenza vaccination rates for older adults were well 
below 5 percent (``Standing Orders for Influenza Vaccination Increased 
Vaccination Rates in Inpatient Settings Compared with Community 
Rates.'' The Journals of Gerontology; Washington; Sep 2000; Vol. 55A; 
9; M522-M526; Fiona Lawson; Vicki Baker; Dick Au; Janet E. McElhaney). 
The main barrier to vaccination was the requirement for a physician's 
order; other issues were that most of the medical staff did not view 
vaccination as a priority, or were concerned that vaccination might not 
be effective or might complicate the patient's course of treatment 
while in the hospital. Because an educational program was predicted to 
be ineffective for changing in-hospital practices of the attending 
staff, an influenza immunization program using a standing order under 
the principal investigator for the study was designed. The purpose of 
the study was to increase vaccination rates in this very high-risk 
group of hospitalized older adults. The result after implementation of 
the inpatient immunization program was an increase of 22 percent in the 
immunization rate. The study also found that in spite of many 
unvaccinated patients indicating that they would be vaccinated after 
discharge, only 1 percent were vaccinated in the community after 
discharge from the hospital.
    Specific recommendations for hospital-based immunization were first 
published by ACIP in the 1980s--for influenza vaccine in 1986, and for 
pneumococcal vaccine in 1989. These recommendations were included in 
the Standards of Adult Immunization Practice that were issued by the 
National Coalition for Adult Immunization in 1990, and appeared in the 
second edition of the American College of Physicians' Guide for Adult 
Immunization (1990). Soon thereafter, hospital-based influenza and 
pneumococcal vaccination was recommended in the National Vaccine 
Advisory Committee's report on adult immunization and in a critical 
report published by the General Accounting Office. Subsequently, this 
strategy was included in the action plan for adult immunizations 
developed by the CDC and CMS, and was later endorsed by the Task Force 
on Community Preventive Services. It also was emphasized in a 
comprehensive report prepared for CMS by the RAND Corporation to 
provide evidence-based recommendations for increasing the use of 
Medicare-funded preventive-care services. (``Hospital-Based Influenza 
and Pneumococcal Vaccination: Sutton's Law Applied to Prevention,'' 
David S. Fedson, MD; Peter Houck, MD; Dale Bratzler, DO, MPH, Infection 
Control and Hospital Epidemiology, Volume 21(11) (692-699), November 
2000.) (Fedson).
    The most remarkable example of success with hospital-based

[[Page 61812]]

immunization is the program that was conducted at the Minneapolis 
Veterans Affairs Medical Center since 1984. This hospital-wide program 
initially focused on influenza vaccination of outpatients and used a 
combination of administrative, organizational, and patient oriented 
interventions. No specific attempts were made to involve physicians. 
Instead, the program was implemented by nurses according to a hospital 
policy that allowed them to vaccinate patients without a signed 
physician's order. By 1987, the program was vaccinating 60 percent of 
the hospital's elderly outpatients; by the late 1990s, almost 90 
percent were regularly receiving influenza vaccine, most of them 
through the hospital's program.
    Among successful programs for hospital-based influenza and 
pneumococcal vaccinations, a standing order is probably the most 
important feature. The ACIP has specifically recommended that standing 
orders be used to increase adult vaccination rates in all settings. 
Furthermore, none of the successful programs described thus far in the 
literature has depended on active physician participation. Instead, 
nurses or pharmacists have been responsible for their implementation. 
(Fedson, 692-699).
2. Long-Term Care Facilities
    We are changing our current regulations in the Conditions of 
Participation for LTCFs at Sec.  483.40 (b)(3) to read ``the physician 
must sign and date all orders with the exception of orders for the 
administration of influenza and pneumococcal polysaccharide vaccines, 
which may be administered per physician-approved facility policy after 
an assessment for contraindications.''
    There were 1,590,763 individuals over 65 years of age in LTCFs in 
the United States in 1990, and the number is estimated to grow to 2.9 
million by 2020. (``Increasing Pneumococcal Vaccination Rates Among 
Residents of Long-Term Care Facilities: Provider-Based Improvement 
Strategies Implemented by Peer-Review Organizations in Four Western 
States.'' Kurt B. Stevenson, MD; John W. McMahon, Sr, MD; Jan Harris, 
MSHA, CHE; J. Richard Hillman, MD; Steven D. Helgerson, MD, MPH. 
Infection Control and Hospital Epidemiology, Volume 21 (11) (705-710) 
November 2000). (Stevenson). A substantial increase in vaccination 
rates among such a large population will prevent a significant number 
of cases of influenza and pneumococcal bacteremia and related deaths. 
Standing orders appear to be one intervention effective in sustaining 
successful vaccination efforts.
3. Home Health Agencies
    We are changing the first sentence of the current requirements in 
the CoPs at Sec.  484.18(c) for HHAs to read ``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.'' HHA staff 
must include the immunization information on the patient's plan of 
care, although a physician's order is not required for influenza and 
pneumoccal vaccines.
    Providing vaccines in settings readily accessible to adults who are 
most in need of the services is critical. For many adults, the need to 
use transportation to reach a healthcare provider is a barrier to 
receiving preventive services. This barrier may be eliminated by 
offering preventive services (for example, administration of vaccines) 
in convenient locations such as the patient's home. Eliminating the 
need for making an appointment in advance and avoiding the waiting time 
often associated with a clinic or office visit are factors that also 
might increase the opportunities for some adults to receive needed 
vaccinations. (``Adult Immunization Programs in Nontraditional 
Settings: Quality Standards and Guidance for Program Evaluation; A 
Report of the National Vaccine Advisory Committee.'' MMWR 49 (RR01)1-
13. March 24, 2000.)
    The 1999 RAND report states that the proportion of the U.S. 
population over age 65 has increased from 5 percent in 1900 to 13 
percent in 1997. This change in demographics, combined with an increase 
in average life expectancy, has highlighted the importance of 
preventive care services for older individuals. According to an October 
1997 JAMA article, vaccination of elderly people against pneumococcal 
bacteremia is one of the few interventions that have been found to both 
improve health and save medical costs. (``Cost-effectiveness of 
Vaccination Against Pneumococcal Bacteremia Among Elderly People.'' 
JAMA; Chicago; Oct 22-Oct 29, 1997; 278;16; Jane E Sisk; Alan J 
Moskowitz; William Whang; Jean D Lin; et al.)

III. 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, when we proceed with a subsequent 
document, we will respond to the comments in the preamble to that 
document.

IV. Waiver of Proposed Rulemaking

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register and invite public comment on the proposed rule. The 
notice of proposed rulemaking includes a reference to the legal 
authority under which the rule is proposed, and the terms and substance 
of the proposed rule or a description of the subjects and issues 
involved. This procedure can be waived, however, if an agency finds 
good cause that a notice-and-comment procedure is impracticable, 
unnecessary, or contrary to the public interest, and incorporates a 
statement of the finding and its reasons in the rule issued.
    The delay in publishing this rule would be extremely detrimental to 
the health of beneficiaries, as epidemics of influenza typically occur 
during the winter months and are responsible for an average of 
approximately 20,000 to 40,000 deaths per year in the United States. 
Influenza viruses also can cause pandemics, during which rates of 
illness and death from influenza-related complications can increase 
dramatically. Rates of infection are highest among children, but rates 
of serious illness and death are highest among persons older than 65 
years of age and persons of any age who have medical conditions that 
place them at increased risk for complications from influenza and 
pneumonia. Vaccines are the most effective means to protect against 
many complications related to influenza and pneumonia. The ACIP 
recommendations for 2002 to 2003 to decrease the risk of influenza 
state that the optimal time for influenza vaccinations is October 
through November. Therefore, it is imperative that this rule is 
published as a final rule immediately and the immunization process be 
implemented without delay this year so that influenza-related 
complications can be prevented. The goal of CMS and CDC, to immunize at 
least 90 percent of the adult population to meet the Healthy People 
2010 objectives, can be attained earlier if the barrier requiring a 
physician's order is removed as soon as possible. Even though 
pneumococcal vaccines can be administered throughout the year the 
percentage of patients and or residents immunized remains low. 
Therefore, this final rule will be a vehicle to improve

[[Page 61813]]

coverage and will be consistent with the Healthy People 2010 
objectives.

V. Waiver of Effective Date

    We believe that a continued delay in implementation of this final 
rule would greatly hinder increased immunizations of beneficiaries in 
the affected facilities before the onset of this year's flu season. As 
a result, we have concluded that, in this instance, a notice-and-
comment period, and a further delay in this rule's effective date is 
unnecessary and contrary to the public interest. We find, on this 
basis, that there is good cause for waiving the notice-and-comment 
period and for establishing this immediate effective date under 5 
U.S.C. section 808(2).

VI. Collection of Information Requirements

    This document does not impose information collection and 
recordkeeping requirements. Consequently, this document does not need 
to be reviewed by the Office of Management and Budget under the 
authority of the Paperwork Reduction Act of 1995.

VII. Regulatory Impact

A. Overall Impact

    We have examined the impact of this rule as required by Executive 
Order 12866 (September 1993, Regulatory Planning and Review), the 
Regulatory Flexibility Act (RFA) (September 16, 1980, Pub. L. 96-354), 
section 1102(b) of the Social Security Act, the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132.
    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 in any one year). This rule 
removes the barrier for an individual physician's order to be necessary 
to administer influenza and pneumococcal polysaccharide vaccines and is 
a requirement that has benefits in improving patient and resident 
health and in reducing health care spending. While it is not possible 
at this point to determine definitively the additional costs to the 
Medicare and Medicaid programs from increased immunizations resulting 
from this rule, we believe that the impact will be below the threshold 
of $100 million and will not be economically significant.
    The RFA requires agencies to analyze options for regulatory relief 
of small businesses. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and government agencies. 
Most hospitals and most other providers and suppliers are small 
entities, either by nonprofit status or by having revenues of $6 to $29 
million in any one year. For purposes of the RFA, all hospitals, LTCFs, 
and HHAs, are considered to be small entities. Individuals and States 
are not included in the definition of a small entity. For these 
reasons, we are not preparing analyses for either the RFA or section 
1102(b) of the Act because we have determined, and we certify, that 
this rule will not have a significant economic impact on a substantial 
number of small entities or a significant impact on the operations of a 
substantial number of small rural hospitals.
    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 604 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. This regulation does not 
have any impact on small rural hospitals that would be burdensome; 
instead rural hospitals will benefit from the implementation of the 
rule, as the overall cost associated with treating influenza and 
pneumococcal disease will be reduced.
    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 expenditure in any one year by 
State, local, or tribal governments, in the aggregate, or by the 
private sector, of $110 million. This rule will not have any effect on 
the governments mentioned or on private sector costs.
    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. This final rule will not have any effect on State or 
local governments. The costs related to the influenza and pneumococcal 
polysaccharide vaccines are currently a covered benefit for 
beneficiaries. In fact, this rule will remove the barriers that may 
have impacted the flexibility of State law in implementing immunization 
related requirements.

B. Anticipated Effects of the Immunization Standards

1. Effects on Hospitals, LTCFs, and HHAs
    We expect that these providers will benefit from the implementation 
of this rule, as prevention of influenza and pneumonia will lower 
hospitalization rates, resulting in cost reductions.
2. Effects on Other Providers
    We do not expect the provisions of this final rule to affect other 
providers.
3. Effects on the Medicare and Medicaid Programs
    While it is not possible at this point to determine definitively 
the additional costs to the Medicare and Medicaid programs from 
increased immunizations resulting from this rule, we believe that, due 
to the low cost for the immunizations, any budget impact to these 
programs would be negligible. Moreover, increased immunizations may 
help reduce the estimated $12 billion dollars in direct and indirect 
costs to society annually during severe influenza epidemics. Moderate 
epidemics cause more than 20,000 to 40,000 hospitalizations and 
estimated direct costs of up to $1 billion per year. (``It Pays to 
Immunize Adults.'' Therese M. Droste. Business and Health; Montvale. 
Sep. 1998; 16; 8-11.) According to the 1997 JAMA article, the first 
pneumococcal polysaccharide vaccine was marketed in the United States 
almost 20 years ago, and two Federal studies have assessed its cost-
effectiveness in preventing pneumococcal pneumonia in elderly people 
(JAMA; Oct 22-29, 1997; 278:1333-1339). In both analyses, vaccination 
was found to be cost-effective, that is, a reasonable investment for 
the health benefits gained. This article also states that even though 
savings cost is not the appropriate criterion for assessing an 
intervention, the issue is whether the investment in an intervention is 
worth the health benefits to be gained. Based on other interventions, 
policymakers have generally considered costs up to $50,000 or even 
$100,000 to be worth an extra year of healthy life. In that light, even 
worst-case estimates for pneumococcal vaccination through age 84 years 
would be deemed cost-effective.
    In 2001, Medicare payments for flu and pneumococcal immunizations

[[Page 61814]]

totaled $145,885,773. This figure represents Medicare payments for such 
immunizations furnished in all settings, including, but not limited to, 
hospitals, nursing homes, and HHAs. Immunization experts working under 
contract to CMS estimate that implementation of this rule will increase 
immunization rates by 10 percent. Therefore, we generally estimate that 
broad implementation of standing orders as allowed by this rule will 
increase Medicare immunization expenditures by $14,588,577 above the 
2001 expenditure.
    These cost-effectiveness results provide a compelling case for 
clinical and public policy to more forcefully promote pneumococcal 
vaccination for elderly people in the United States. They thus add 
support on economic grounds to public and private efforts already under 
way. (JAMA; Oct 22-29; 1997; 278:16)

C. Alternatives Considered

1. Immunization Standards for Hospitals, Long-Term Care Facilities, and 
Home Health Agencies
    An alternative would be to keep the present rules, as they are 
written. The current regulations, however, inhibit our ability to 
increase the rate of immunizations and to accomplish our goal to 
immunize at least 90 percent of the institutionalized population.
    Another alternative would be to educate providers on the value of 
influenza and pneumococcal vaccines while maintaining the Federal 
barrier requiring a physician's order for every vaccine given in these 
provider types. Studies previously referred to, however, show that this 
has not been very effective in improving immunization rates.

D. Conclusion

    Increasing the utilization of Medicare-funded preventive services 
is the goal of both CMS and CDC, and this final rule will facilitate 
the delivery of appropriate vaccinations in a timely manner, increase 
the levels of vaccination rate, and decrease the morbidity and 
mortality rate of influenza and pneumococcal diseases.
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

List of Subjects

42 CFR Part 482

    Grant programs-health, Hospitals, Medicaid, Medicare, Reporting and 
recordkeeping requirements.

42 CFR Part 483

    Grant programs-health, Health facilities, Health professions, 
Health records, Medicaid, Medicare, Nursing homes, Nutrition, Reporting 
and recordkeeping requirements, Safety.

42 CFR Part 484

    Health facilities, Health professions, Medicare, Reporting and 
recordkeeping requirements.


    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services amends 42 CFR chapter IV as set forth below:

PART 482--CONDITIONS OF PARTICIPATION FOR HOSPITALS

    1. The authority citation for part 482 continues to read as 
follows:

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

Subpart C--Basic Hospital Functions

    2. In Sec.  482.23, the first sentence of paragraph (c)(2) is 
revised to read as follows:


Sec.  482.23  Condition of participation: Nursing services.

* * * * *
    (c) * * *
    (2) All orders for drugs and biologicals must be in writing and 
signed by the practitioner or practitioners responsible for the care of 
the patient as specified under Sec.  482.12(c) with the exception of 
influenza and pneumococcal polysaccharide vaccines, which may be 
administered per physician-approved hospital policy after an assessment 
for contraindications. * * *
* * * * *

PART 483--REQUIREMENTS FOR STATES AND LONG-TERM CARE FACILITIES

    1. The authority citation for part 483 continues to read as 
follows:

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

Subpart B--Requirements for Long-Term Care Facilities

    2. In Sec.  483.40, paragraph (b)(3) is revised to read as follows:


Sec.  483.40  Physician services.

* * * * *
    (b) * * *
    (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.
* * * * *

PART 484--HOME HEALTH SERVICES

    1. The authority citation for part 484 continues to read as 
follows:

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


    2. In Sec.  484.18 the first sentence of paragraph (c) is revised 
to read as follows:


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

* * * * *
    (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. * * *

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)
(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
    Dated: July 23, 2002.
Thomas A. Scully,
Administrator, Centers for Medicare & Medicaid Services.
    Approved: August 28, 2002.
Tommy G. Thompson,
Secretary.
[FR Doc. 02-25096 Filed 10-1-02; 8:45 am]
BILLING CODE 4120-01-P