[Federal Register Volume 72, Number 56 (Friday, March 23, 2007)]
[Rules and Regulations]
[Pages 13710-13711]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-1434]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 411 and 424

[CMS-1810-RCN]
RIN 0938-AK67


Medicare Program; Physicians' Referrals to Health Care Entities 
With Which They Have Financial Relations (Phase II); Continuation of 
Effectiveness and Extension of Timeline for Publication of Final Rule

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

ACTION: Interim final rule; continuation of effectiveness and extension 
of timeline for publication of final rule.

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SUMMARY: This notice announces the continuation of effectiveness of a 
Medicare interim final rule and the extension of the timeline for 
publication of the final rule. This notice is issued in accordance with 
section 1871(a)(3)(C) of the Social Security Act (the Act), which 
allows an interim final rule to remain in effect after the expiration 
of the timeline specified in section 1871(a)(3)(B) of the Act if the 
Secretary publishes a notice of continuation prior to the expiration of 
the timeline.

DATES: Effective Date: This notice is effective on March 23, 2007.

FOR FURTHER INFORMATION CONTACT: Lisa Ohrin, (410) 786-4565.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 1871(a)(3)(A) of the Social Security Act (Act) requires the 
Secretary, in consultation with the Director of the Office of 
Management and Budget (OMB), to establish a regular timeline for the 
publication of a final rule based on the previous publication of a 
proposed rule or an interim final rule. In accordance with section 
1871(a)(3)(B) of the Act, such regular timeline may vary among 
different final rules, based on the complexity of the rule, the number 
and scope of the comments received, and other relevant factors. The 
timeline for publishing the final regulation; however, cannot exceed 3 
years from the date of publication of the proposed or interim final 
rule, unless there are exceptional circumstances. After consultation 
with the Director of OMB, we published a notice in the Federal Register 
on December 30, 2004 (69 FR 78442) establishing a general 3-year 
timeline for publishing final rules after the publication of a proposed 
or interim final rule.
    Section 1871(a)(3)(C) of the Act states that a Medicare interim 
final rule shall not continue in effect if the final rule is not 
published before the expiration of the regular timeline, unless the 
Secretary publishes at the end of the regular timeline a notice of 
continuation that includes an explanation of why the regular timeline 
was not met. Upon publication of such a notice, the timeline for 
publishing the final rule is extended for 1 year.

II. Notice of Continuation

    On March 26, 2004, we published an interim final rule with comment 
period (the ``Phase II'' rule), which set forth the physician self-
referral prohibition and applicable definitions, interpreted various 
statutory exceptions to the prohibition, and created additional 
regulatory exceptions for arrangements that do not pose a risk of 
program or patient abuse (69 FR 16054). Phase II also responded to 
comments received from an earlier interim final rule (the ``Phase I'' 
rule) regarding the physician self-referral prohibition, which was 
published on January 4, 2001 (66 FR 856). Under the previously 
established regular timeline for the publication of a final rule, we 
must respond to public comments on the Phase II rule in a final rule 
(the ``Phase III'' rule) published no later than March 26, 2007.
    This notice announces an extension of the timeline for publication 
of the Phase III physician self-referral final rule and the 
continuation of effectiveness of the Phase II interim final rule. We 
are not able to meet the 3-year timeline for publication because we 
received extensive public comments requesting clarification of and 
revisions to the

[[Page 13711]]

physician self-referral regulations. We have given the numerous and 
varied public comments exhaustive review, which required a significant 
amount of time and resources. Further, because the physician self-
referral rules are jointly enforced by CMS, the Office of Inspector 
General, and the Department of Justice, substantial interagency 
coordination has been necessary.
    This notice extends the timeline for publication of the Phase III 
final rule through March 26, 2008. In accordance with section 
1871(a)(3)(C) of the Act, the March 26, 2004 interim final rule shall 
remain in effect through March 26, 2008 (unless Phase III is published 
and becomes effective before March 26, 2008).

    Authority: Section 1871 of the Social Security Act (42 U.S.C. 
1395hh).

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

    Dated: March 19, 2007.
Ann C. Agnew,
Executive Secretary to the Department.
[FR Doc. 07-1434 Filed 3-20-07; 4:00 am]
BILLING CODE 4120-01-P