[Federal Register Volume 70, Number 57 (Friday, March 25, 2005)]
[Notices]
[Pages 15333-15335]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-5550]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-2208-FN]


Medicare and Medicaid Programs; Recognition of the American 
Osteopathic Association (AOA) for Continued Approval of Deeming 
Authority for Hospitals

AGENCY: Centers for Medicare and Medicaid Services, HHS.

ACTION: Final notice.

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SUMMARY: This notice announces the Centers for Medicare & Medicaid 
Services' (CMS') reapproval of the American Osteopathic Association 
(AOA) as a national accreditation organization for hospitals that 
request participation in the Medicare program. We have determined that 
accreditation of hospitals by AOA demonstrates that all Medicare 
hospital conditions of participation are met or exceeded. Thus, CMS 
will continue to grant deemed status to those hospitals accredited by 
AOA.

DATES: Effective Date: This final notice is effective March 25, 2005 
through September 25, 2009.

FOR FURTHER INFORMATION CONTACT: Marjorie Eddinger (410) 786-0375.

SUPPLEMENTARY INFORMATION:

I. Background

A. Laws and Regulations

    Under the Medicare program, eligible beneficiaries may receive 
covered services in a hospital provided certain requirements are met. 
The regulations specifying the Medicare conditions of participation for 
hospitals are located in 42 CFR part 482. These conditions implement 
section 1861(e) of the Social Security Act (the Act), which specifies 
services covered as hospital care and the conditions that a hospital 
program must meet in order to participate in the Medicare program.
    Regulations concerning provider agreements are at 42 CFR part 489 
and those pertaining to the activities relating to the survey and 
certification of facilities are at 42 CFR part 488.
    Generally, in order to enter into a provider agreement, a hospital 
must first be certified by a State survey agency as complying with the 
conditions or standards set forth in the statute and part 482 of the 
regulations. Then, the hospital is subject to regular surveys by a 
State survey agency to determine whether it continues to meet Medicare 
requirements. There is an alternative, however, to surveys by State 
agencies.
    Section 1865(b)(1) of the Act permits hospitals accredited by the 
AOA to be exempt from routine surveys by State survey agencies to 
determine compliance with Medicare conditions of participation. 
Accreditation by an accreditation organization is voluntary and is not 
required for Medicare participation. Section 1865(b)(1) of the Act 
provides that, if a provider demonstrates through accreditation that 
all applicable conditions are met or exceed the Medicare conditions, we 
shall ``deem'' the hospital as having met the health and safety 
requirements.
    Our regulations concerning reapproval of accrediting organizations 
are set forth at Sec.  488.4 and Sec.  488.8(d)(3). The regulations at 
Sec.  488.8(d)(3) require reapplication at least every 6 years and 
permit us to determine the required materials from those enumerated in 
Sec.  488.4 and the deadline to reapply for continued approval of 
deeming authority.

II. Approval of Deeming Organizations

    Section 1865(b)(2) of the Act further requires that our findings 
concerning review of national accrediting organizations consider, among 
other factors, the accreditation organization's requirements for 
accreditation, its survey procedures, its ability to provide adequate 
resources for conducting required surveys and ability to supply 
information for use in enforcement activities, its monitoring 
procedures for provider entities found out of compliance with the 
conditions or requirements, and its ability to provide us with 
necessary data for validation.
    Section 1865(b)(3)(A) of the Act further requires that we publish, 
within 60 days of receipt of an organization's complete application, a 
notice of the national accreditation body's application, identifying 
the national accreditation body making the request, describing the 
nature of the request, and providing at least a 30-day public comment 
period. Subsequently, we have 210 days from the receipt of the request 
to publish approval or denial of the application.
    The purpose of this notice is to notify the public of our decision 
to approve AOA's request for continuation of its deeming authority. 
This decision is based on our finding that the AOA's separate 
accreditation program for hospital care meets or exceeds the Medicare 
hospital conditions of participation.

III. Proposed Notice

    On September 24, 2004, we published a proposed notice in the 
Federal Register (69 FR 57308) announcing AOA's request for reapproval 
as a deeming organization for hospitals. In the notice, we detailed the 
evaluation criteria. As set forth under section 1865(b)(2) of the Act 
and our regulations at Sec.  488.8(d)(3)(i), our review and evaluation 
of the AOA application included the following:
    1. An on-site administrative review of the corporate policies, 
resources to accomplish the accreditation surveys, program and surveyor 
evaluation and monitoring, AOA's ability to investigate and respond 
appropriately to complaints against accredited facilities, and the 
survey review and decision-making process for accreditation.
    2. A determination of the equivalency of AOA's standards for a 
hospital to our comparable hospital conditions of participation.
    3. A review through documentation and on-site observation of AOA's 
survey processes to determine the following:
     The comparability of AOA's processes to those of State 
agencies, including survey frequency and whether surveys are announced 
or unannounced.
     The adequacy of the guidance and instructions and survey 
forms AOA provides to surveyors.
     AOA's procedures for monitoring providers or suppliers 
found to be out of compliance with program requirements. (These 
procedures are used only when AOA identifies noncompliance.)
    4. AOA's procedures for responding to complaints and for 
coordinating these activities with appropriate licensing bodies and 
ombudsmen programs.
    5. AOA's policies and procedures for identifying potential fraud 
and abuse and its coordination with, or reporting to, CMS.
    6. AOA's survey team, the content and frequency of the in-service 
training provided, the evaluation systems used to assess the 
performance of surveyors, and potential conflict-of-interest policies 
and procedures.
    7. AOA's data management system and reports used to assess its 
surveys and accreditation decisions, and its ability to provide us with 
electronic data and new statistical validation information including 
the number, accreditation status, and resurvey cycle for facilities; 
the number, types, and resolution times for follow up when

[[Page 15334]]

deficiencies are detected during surveys; the top 10 deficiencies 
found, and the number of actionable cases of noncompliance and the 
method and time frame for resolution.
    8. A review of all types of accreditation status AOA offers and an 
assessment of the appropriateness of those for which AOA seeks deemed 
status.
    9. A review of the pattern of AOA's deemed facilities (that is, 
types and duration of accreditation and its schedule of all planned 
full and partial surveys).
    10. The adequacy of AOA's staff and other resources to perform the 
surveys, and its financial viability.
    11. AOA's written agreement to:
     Meet our requirements to provide to all relevant parties, 
timely notifications of changes to accreditation status or ownership, 
to report to all relevant parties remedial actions or immediate 
jeopardy, and to conform its requirements to changes in Medicare 
requirements; and
     Permit its surveyors to serve as witnesses for us in 
adverse actions against its accredited facilities.

IV. Summary of Public Comments Received on the Proposed Notice and Our 
Responses

    We received no public comments.

V. Review and Evaluation

    Our review and evaluation of the AOA application, which were 
conducted as detailed above, yielded the following information.
    We compared the standards contained in the AOA ``Accreditation 
Requirements for Healthcare Facilities'' and the AOA's survey process 
outlined in its ``Survey Team Handbook'' supplemented by flow charts of 
the survey process with the Medicare conditions of participation and 
the ``State Operations Manual''. The AOA has made the following 
revisions or clarifications.
    1. AOA developed and implemented standards and survey processes to 
address the new Quality Assessment and Performance Improvement Program 
Condition of Participation in accordance with the provisions of Sec.  
482.21.
    2. AOA developed and implemented standards and survey processes to 
address the new Life Safety from Fire Standard (which implements the 
use of the 2000 edition of the Life Safety Code of the National Fire 
Protection Association) in accordance with the provisions of Sec.  
482.41(b).
    3. AOA developed and implemented standards and survey processes to 
address changes in the Discharge Planning Condition of Participation in 
accordance with Sec.  482.43.
    4. AOA developed and implemented standards and survey processes to 
address changes in the Nursing Services Condition of Participation in 
accordance with Sec.  482.23.
    5. AOA developed and implemented standards and survey processes to 
address changes in the requirements for physician supervision of 
certified registered nurse anesthetists (CRNAs) in Anesthesia Services 
Condition of Participation in accordance with Sec.  482.52.
    6. AOA developed and implemented standards, explanations, and 
survey processes that are consistent with the Regulations at 42 CFR 
part 482 and CMS Interpretive Guidelines for the Hospital Conditions of 
Participation in Appendix A of the State Operations Manual which 
include the following:
     In order to meet the requirements of Sec.  482.13(a)(2), 
AOA added wording to its standard that makes the governing body 
responsible for the grievance process.
     AOA added language to its standard 1.00.13 that the 
hospital must maintain a list of all contracted services, including 
scope and nature of services provided to meet the standard of Sec.  
482.12(e)(2).
     AOA included criteria for determining the privileges to be 
granted to individual practitioners and a procedure for applying the 
criteria to individuals requesting privileges in order to meet the 
requirements of Sec.  482.22(c)(6).
     In order to comply with the requirements at Sec.  
482.27(c)(3)(i) and Sec.  482.27(c)(3)(ii), AOA added language to its 
standard concerning the hospital's policies about the disposition of 
blood or blood products and quarantine all blood and blood products 
from previous donations in inventory.
     In order to meet the requirements of Sec.  482.27(c)(1), 
AOA added the FDA definition of potentially infectious blood and blood 
products to its standard.
     AOA reworded its standard at 15.05.02 to address CMS 
restraint requirements at Sec.  482.13(e)(2) and Sec.  482.13(f)(2).
     In order to meet the requirements of Sec. Sec.  
482.13(b)(1) and Sec.  482.13(b)(2), AOA added standards that included 
the patient's right to participate in the development and 
implementation of his or her plan of care, and the right to be informed 
of his or her health status, care planning, and treatment.
     In order to meet the requirements of Sec.  482.23(b)(1), 
AOA added language to its standard to include that the hospital must 
provide 24-hour registered nursing services at all times, except for 
rural hospitals that have in effect a 24-hour registered nursing waiver 
granted under Sec.  488.54.
     AOA added standards to its chapter on Respiratory Services 
in order to meet the requirements at Sec.  482.57, Sec.  482.57(a), 
Sec.  482.57(b), and Sec.  482.57(b)(2).
     In order to meet the requirements of Sec.  482.53(b) and 
Sec.  482.53(b)(3), AOA added language to its chapter 23.00.01 on 
Nuclear Medicine Services.
     AOA added language to its standard to address the 
responsibility of daily management of the dietary services and that the 
individual was qualified by experience or training in order to meet the 
requirements at Sec.  482.28(a)(1)(ii) and Sec.  482.28(a)(1)(iii).
     To meet the requirements at Sec.  482.28(b)(2), AOA added 
the language that nutritional needs must be met in accordance with 
recognized dietary practices and in accordance with orders of the 
practitioner or practitioners responsible for the care of the patients.
     AOA added language to its chapter on Surgical Services 
language that the organization of the surgical services must be 
appropriate to the scope of the services offered in order to meet CMS 
standards at Sec.  482.51(a).
     In order to meet the requirements at Sec.  482.51(b)(4), 
AOA added to its standard wording to state that there must be adequate 
provisions for immediate post-operative care.
    7. All AOA hospital surveys will be unannounced effective January 
1, 2006 in accordance with the CMS policy of unannounced hospital 
surveys.
    8. AOA revised procedures and clarified its timeframes for 
complaint investigations in accordance with the State operations 
Manual.
    9. AOA redesigned its survey process to emphasize the use of 
interviews and surveyor observations of patient care and other 
compliance activities in order to determine the hospital compliance 
with requirements.

VI. Results of Evaluation

    We completed a standard-by-standard comparison of AOA's conditions 
or requirements for hospitals to determine whether they met or exceeded 
Medicare requirements. We found that, after requested revisions were 
made, AOA's requirements for hospitals did meet or exceed our 
requirements. In addition, we visited the corporate headquarters of AOA 
to validate the information it submitted and to verify that its 
administrative systems could adequately monitor compliance with its 
standards and survey processes and that

[[Page 15335]]

its decision-making documentation and processes met our standards. We 
also observed a survey in real time to see that it met or exceeded our 
standards. As a result of our review of the documents and observations, 
we requested certain clarifications to AOA's survey and communications 
processes. These clarifications were provided as indicated above, and 
changes were made to the documentation in the application. Therefore, 
we recognize AOA as a national accreditation organization for hospitals 
that request participation in the Medicare program, effective March 25, 
2005 through September 25, 2009.

VII. Collection of Information Requirements

    This document does not impose any information collection and record 
keeping requirements subject to the Paperwork Reduction Act (PRA). 
Consequently, it does not need to be reviewed by the Office of 
Management and Budget (OMB) under the authority of the PRA. The 
requirements associated with granting and withdrawal of deeming 
authority to national accreditation, codified in part 488, ``Survey, 
Certification, and Enforcement Procedures,'' are currently approved by 
OMB under OMB approval number 0938-0690, with an expiration date of 
October 31, 2005.

VIII. Regulatory Impact Statement

    We have examined the impacts of this notice as required by 
Executive Order 12866 and the Regulatory Flexibility Act (RFA) (Pub. L. 
96-354). Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects; distributive impacts; and equity). The RFA requires agencies 
to analyze options for regulatory relief for small businesses. For 
purposes of the RFA, States and individuals are not considered small 
entities.
    Also, section 1102(b) of the Act requires the Secretary to prepare 
a regulatory impact analysis for any notice that may have a significant 
impact on the operations of a substantial number of small rural 
hospitals. Such an analysis must conform to the provisions of section 
604 of the RFA. For purposes of section 1102(b) of the Act, we consider 
a small rural hospital as a hospital that is located outside of a 
Metropolitan Statistical Area and has fewer than 100 beds.
    This notice merely recognizes AOA as a national accreditation 
organization for hospitals that request participation in the Medicare 
program. As evidenced by the following data for the cost of surveys, 
there are neither significant costs nor savings for the program and 
administrative budgets of the Medicare program. This notice is not a 
major rule as defined in Title 5, United States Code, section 804(2) 
and is not an economically significant rule under Executive Order 
12866.
    Therefore, we have determined, and the Secretary certifies, that 
this notice will not result in a significant impact on a substantial 
number of small entities and will not have a significant effect on the 
operations of a substantial number of small rural hospitals. Therefore, 
we are not preparing analyses for either the RFA or section 1102(b) of 
the Act.
    In an effort to better ensure the health, safety, and services of 
beneficiaries in hospitals already certified, and to provide relief to 
State budgets in this time of tight fiscal constraints, we deem 
hospitals accredited by the AOA as meeting our Medicare hospital 
conditions of participation.
    In accordance with Executive Order 13122, Federalism, we have 
included various provisions throughout this regulation that demonstrate 
cooperation with the States. For example, while the provisions of this 
notice may reduce the number of surveys a State Agency performs for 
Medicare certification of hospital, it may engender additional 
validation surveys to assess the performance of the AOA survey process 
and standards as the validation process expands with the growth of 
deemed status facilities. State officials will remain responsible for 
any survey and certification requirements that are allegedly not being 
enforced.

IX. Executive Order 12866 Statement

    In accordance with the provisions of Executive Order 12866, this 
notice was not reviewed by OMB.

    Authority: Sec. 1865(b)(3)(A) of the Social Security Act (42 
U.S.C. 1395bb(b)(3)(A)).

(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance; and Program No. 93.778, Medical 
Assistance Program)

    Dated: February 18, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 05-5550 Filed 3-24-05; 8:45 am]
BILLING CODE 4120-01-P