[Federal Register Volume 71, Number 121 (Friday, June 23, 2006)]
[Notices]
[Pages 36100-36101]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-9907]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-2228-FN]


Medicare and Medicaid Programs; Denial of the T[Uuml]V Healthcare 
Specialists Request for Deeming Authority for Hospitals

AGENCY: Centers for Medicare & Medicaid Services, HHS.

ACTION: Final notice.

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SUMMARY: This final notice announces our decision to deny T[Uuml]V 
Healthcare Specialists' (T[Uuml]VHS) request for deeming authority for 
hospitals that wish to participate in the Medicare and Medicaid 
programs.

EFFECTIVE DATE: This final notice is effective June 23, 2006.

FOR FURTHER INFORMATION CONTACT: Amber MacCarroll, (410) 786-6773.

SUPPLEMENTARY INFORMATION:

I. Background

    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 
(CoP) for hospitals are located at 42 CFR part 482. These conditions 
implement section 1861(e) of the Social Security Act (the Act), which 
specifies 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 activities 
relating to the survey and certification of facilities are at 42 CFR 
part 488.
    Generally, in order to enter into an agreement with CMS, a hospital 
must first be certified by a State survey agency as complying with the 
conditions or requirements set forth in part 482 of our regulations. 
Then, the hospital is subject to regular surveys by a State survey 
agency to determine whether it continues to meet these requirements. 
There is an alternative, however, to surveys by State agencies.
    Section 1865(b)(1) of the Act provides that, if a provider entity 
demonstrates through accreditation by an approved national 
accreditation organization that all applicable Medicare conditions are 
met or exceeded, we will ``deem'' those provider entities as having met 
the requirements. Accreditation by an accreditation organization is 
voluntary and is not required for Medicare participation.
    If an accreditation organization is recognized by the Secretary as 
having standards for accreditation that meet or exceed Medicare 
requirements, any provider entity accredited by the national 
accrediting body's approved program would be deemed to meet the 
Medicare conditions. A national accreditation organization applying for 
approval of deeming authority under part 488, subpart A must provide us 
with reasonable assurance that the accreditation organization requires 
the accredited provider entities to meet requirements that are at least 
as stringent as the Medicare conditions.
    The Joint Commission on Accreditation of Healthcare Organizations 
(JCAHO) and the American Osteopathic Association (AOA) are currently 
the only approved national accreditation organizations for hospitals.

II. Deeming Applications Review Process

    Section 1865(b)(2) of the Act and our regulations at Sec.  488.8(a) 
require that our findings concerning review and approval of a national 
accrediting organization's requirements consider, among other factors, 
the applying accreditation organization's requirements for 
accreditation, including health and safety standards; survey 
procedures; resources for conducting required surveys; capacity to 
furnish information for use in enforcement activities; monitoring 
procedures for provider entities found not in compliance with the 
conditions or requirements; and ability to provide us with the 
necessary data for validation.
    Section 1865(b)(3)(A) of the Act provides a statutory timetable to 
ensure that our review of deeming applications is conducted in a timely 
manner. The Act provides us with 210 calendar days after the date of 
receipt of an application to complete our survey activities and 
application review process. At the end of the 210-day period, we must 
publish an approval or denial of the application.

III. Proposed Notice

    On January 27, 2006, we published a proposed notice (71 FR 4584) 
announcing T[Uuml]V Healthcare Specialists' (T[Uuml]VHS') request for 
approval as a deeming organization for hospitals. In the proposed 
notice, we detailed our evaluation criteria as set forth in section 
1865(b)(2) of the Act and our regulations at Sec.  488.8 (Federal 
review of accreditation organizations). Our review and evaluation of 
T[Uuml]VHS was conducted in accordance with, but not necessarily 
limited to, the following factors:
     The equivalency of T[Uuml]VHS' standards for hospitals as 
compared with our Medicare hospital conditions of participation; and
     T[Uuml]VHS' survey process to determine the following:

--The composition of the survey team, surveyor qualifications, and the 
ability of the organization to provide continuing survey or training.
--The comparability of T[Uuml]VHS' survey procedures to those of State 
agencies, including survey frequency, and the ability to investigate 
and respond appropriately to complaints against accredited facilities.
--T[Uuml]VHS' processes and procedures for monitoring providers or 
suppliers found out of compliance with T[Uuml]VHS program requirements. 
These monitoring procedures are used only when T[Uuml]VHS identifies 
noncompliance. If noncompliance is identified through validation 
reviews, the survey agency monitors corrections as specified at Sec.  
488.7(d).
--T[Uuml]VHS' capacity to report deficiencies to the surveyed 
facilities and respond to the facility's plan of correction in a timely 
manner.
--T[Uuml]VHS' capacity to provide us with electronic data in ASCII 
comparable code, and reports necessary for

[[Page 36101]]

effective validation and assessment of the organization's survey 
process.
--The adequacy of T[Uuml]VHS' staff and other resources, and its 
financial viability.
--T[Uuml]VHS' capacity to adequately fund required surveys.
--T[Uuml]VHS' policies with respect to whether surveys are announced or 
unannounced.
--T[Uuml]VHS' agreement to provide us with a copy of the most current 
accreditation survey together with any other information related to the 
survey as we may require (including corrective action plans).

IV. Analysis of and Response to Public Comments on the Proposed Notice

    We received 12 comments in response to the proposed notice 
published on January 27, 2006. These comments were from hospitals, 
professional organizations, an accrediting body and other individuals. 
Summaries of the public comments we received and our responses to those 
comments are set forth below.
    Comment: The majority of commenters expressed support for increased 
competition in the hospital accreditation arena.
    Response: We appreciate the commenters' support and agree that the 
accreditation process can benefit from increased competition. CMS must, 
however, ensure that any national accreditation organization approved 
for deeming authority meets our requirements and can provide us with 
reasonable assurance that its accredited hospitals are in compliance 
with accreditation standards that meet or exceed the Medicare CoPs.
    Comment: A few commenters expressed support specifically for the 
approval of T[Uuml]VHS' request for deeming authority. Conversely, one 
commenter expressed concerns about the T[Uuml]VHS accreditation process 
and provided specific technical comments regarding the ISO 9001 
certification process.
    Response: Based on our findings from the review of T[Uuml]VHS' 
application, T[Uuml]VHS has not demonstrated that it meets our 
requirements for approval as a national accreditation organization. 
Also, T[Uuml]VHS did not provide us with reasonable assurance that its 
accredited hospitals are in compliance with accreditation standards 
that meet or exceed the Medicare CoPs.
    Comment: One commenter asked us to consider the apparent conflict 
of interest that is posed by T[Uuml]VHS offering consultative services 
to prepare hospitals for JCAHO's accreditation reviews, while 
requesting deeming authority for Medicare participating hospitals, 
which would be in direct competition to JCAHO.
    Response: We agree that it is an unusual situation to have an 
organization apply for deeming authority while continuing to offer 
consultative services to prepare hospitals for accreditation surveys 
that are conducted by another accreditation organization. Because we 
are not granting deeming authority to T[Uuml]VHS at this time, the 
suggested conflict of interest is not relevant.

V. Provisions of the Final Notice

    Based on the findings from our review, using the evaluation 
criteria described above, we determined that the T[Uuml]VHS 
accreditation requirements for hospitals, including the accreditation 
standards, standards application and interpretation, survey procedures, 
and corrective action requirements, are not equivalent to the CMS 
requirements for hospitals. Additionally, T[Uuml]VHS has not provided 
reasonable assurance that the hospitals they accredit are in compliance 
with accreditation standards that are at least as stringent as the 
Medicare Hospital CoPs.
    The findings from the review, as described above, preclude us from 
granting T[Uuml]VHS deeming authority for hospitals.

VI. Executive Order 12866 Statement

    In accordance with the provisions of Executive Order 12866, this 
regulation was not reviewed by the Office of Management and Budget.

    Authority: Section 1865 of the Social Security Act (42 U.S.C. 
1395bb)

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program; No. 93.773, Medicare--Hospital Insurance 
Program; and No. 93.774, Medicare--Supplementary Medical Insurance 
Program)

    Dated: June 9, 2006.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
 [FR Doc. E6-9907 Filed 6-22-06; 8:45 am]
BILLING CODE 4120-01-P