[Federal Register Volume 72, Number 164 (Friday, August 24, 2007)]
[Rules and Regulations]
[Pages 48562-48574]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-16647]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 482

[CMS-3014-IFC]
RIN 0938-AJ29


Medicare and Medicaid Programs; Hospital Conditions of 
Participation: Laboratory Services

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

ACTION: Interim final rule with comment period.

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SUMMARY: This interim final rule with comment period requires hospitals 
that transfuse blood and blood components to: Prepare and follow 
written procedures for appropriate action when it is determined that 
blood and blood components the hospitals received and transfused are at 
increased risk for transmitting hepatitis C virus (HCV); quarantine 
prior collections from a donor who is at increased risk for 
transmitting HCV infection; notify transfusion recipients, as 
appropriate, of the need for HCV testing and counseling; and extend the 
records retention period for transfusion-related data to 10 years.
    These changes are based on recommendations by the Secretary's 
Advisory Committee on Blood Safety and Availability and are being 
published in conjunction with the Food and Drug Administration's (FDA) 
Final Rule, ``Current Good Manufacturing Practice for Blood and Blood 
Components; Notification of Consignees and Transfusion Recipients 
Receiving Blood and Blood Components at Increased Risk of Transmitting 
HCV Infection'' (``lookback'') found elsewhere in this issue of the 
Federal Register. The intent is to aid in the prevention of HCV 
infection and to create opportunities for disease prevention that, in 
most cases, can occur many years after recipient exposure to a donor.

DATES: Effective Date: These regulations are effective on February 20, 
2008.
    Comment date: To be assured consideration, comments must be 
received at one of the addresses provided below, no later than 5 p.m. 
on October 23, 2007.

ADDRESSES: In commenting, please refer to file code CMS-3014-IFC. 
Because of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of three ways (no duplicates, 
please):
    1. Electronically. You may submit electronic comments on specific 
issues in this regulation to http://www.cms.hhs.gov/eRulemaking. Click 
on the link ``Submit electronic comments on CMS regulations with an 
open comment period.'' (Attachments should be in Microsoft Word, 
WordPerfect, or Excel; however, we prefer Microsoft Word.)
    2. By regular mail. You may mail written comments (one original and 
two copies) to the following address ONLY: Centers for Medicare & 
Medicaid

[[Page 48563]]

Services, Department of Health and Human Services, Attention: CMS-3014-
IFC, P.O. Box 8014, Baltimore, MD 21244-8014.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments (one 
original and two copies) to the following address ONLY: Centers for 
Medicare & Medicaid Services, Department of Health and Human Services, 
Attention: CMS-3014-IFC, Mail Stop C4-26-05, 7500 Security Boulevard, 
Baltimore, MD 21244-1850.
    4. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments (one original and two copies) before the 
close of the comment period to one of the following addresses. If you 
intend to deliver your comments to the Baltimore address, please call 
telephone number (410) 786-9994 in advance to schedule your arrival 
with one of our staff members. Room 445-G, Hubert H. Humphrey Building, 
200 Independence Avenue, SW., Washington, DC 20201; or 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 persons 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 received after the comment 
period.
    Submission of comments on paperwork requirements. You may submit 
comments on this document's paperwork requirements by mailing your 
comments to the addresses provided at the end of the ``Collection of 
Information Requirements'' section in this document.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT: Mary Collins, (410) 786-3189. Jeannie 
Miller, (410) 786-3164.

SUPPLEMENTARY INFORMATION:
    Submitting Comments: We welcome comments from the public on all 
issues set forth in this rule to assist us in fully considering issues 
and developing policies. You can assist us by referencing the file code 
CMS-3014-IFC and the specific ``issue identifier'' that precedes the 
section on which you choose to comment.
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://www.cms.hhs.gov/eRulemaking. Click on the link ``Electronic Comments on 
CMS Regulations'' on that Web site to view public comments.
    Comments received timely will also 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, 
phone 1-800-743-3951.
    This Federal Register document is also available from the Federal 
Register online database through GPO Access, a service of the U.S. 
Government Printing Office. The Web site address is: http://www.access.gpo.gov/fr/index.html.

I. Background

    In accordance with section 1861(e) of the Social Security Act (the 
Act), hospitals must meet certain conditions in order to participate in 
the Medicare program. These conditions are intended to protect patient 
health and safety and ensure that high-quality care is provided. 
Hospitals receiving payment under Medicaid must meet the Medicare 
conditions of participation.
    Regulations containing the Medicare conditions of participation for 
hospitals are located in the Code of Federal Regulations (CFR) at 42 
CFR part 482. The condition of participation for hospital laboratory 
services at Sec.  482.27(c) currently specifies the steps hospitals 
must take when they become aware they have administered potentially 
human immunodeficiency virus (HIV) infectious blood or blood components 
to a patient. The more detailed requirements for laboratories appear in 
42 CFR part 493, which sets forth requirements for all laboratories 
participating in the Medicare, Medicaid, and Clinical Laboratory 
Improvement Amendments (CLIA) programs.
    The Centers for Medicare & Medicaid Services (CMS) and Federal 
agencies that comprise the Public Health Services, including the Food 
and Drug Administration (FDA), the Centers for Disease Control and 
Prevention (CDC), and the National Institutes of Health (NIH), are 
responsible for ensuring the safety of blood and blood components. In 
the November 16, 2000 proposed rule (65 FR 69416), we used the term 
``blood banks'' to refer to establishments that supply blood. However, 
for consistency, we will use the FDA's term of ``a blood collecting 
establishment'' (BCE) since blood suppliers include hospital blood 
banks and blood donor centers. BCEs are subject to the FDA regulations 
for current good manufacturing practice and additional standards for 
the manufacture of blood and blood components under 21 CFR parts 211, 
600, 601, 606, 610, and 640. Laboratories that provide transfusion 
services are subject to CLIA requirements for quality control and 
health and safety standards (42 CFR part 493, subpart K). Laboratories 
in hospitals are also subject to the hospital conditions of 
participation for adequacy of laboratory services (42 CFR 482.27). We 
coordinate inspections of hospital-based BCEs with the FDA to minimize 
duplication of effort and reduce the burden on affected facilities.
    Hepatitis C virus (HCV) was first discovered and established as a 
causative agent of transfusion-associated hepatitis in the late 1980s. 
In October 1989, FDA's Blood Products Advisory Committee (BPAC) first 
discussed steps to identify and quarantine potentially HCV infectious 
blood and blood components remaining in storage and notify recipients 
that they may possibly have received infectious blood or blood 
products. (These steps are known as a lookback.) BPAC advised that 
there was insufficient information available concerning HCV infection 
to propose either product quarantine or notification of recipients 
transfused with blood and blood components prepared from prior 
collections from donors later determined to be at increased risk for 
transmitting HCV.
    In 1996, the Tenth Report of the U.S. House of Representatives 
Committee on Government Reform and Oversight (H. Rpt. No. 104-746) 
focused attention on the significant public health problem that HCV 
infections pose for the nation. HCV infection is the most common 
chronic blood-borne infection in the United States. The CDC estimates 
that during the 1980s, as many as 230,000 new HCV infections occurred 
each year. Since 1989, the annual number of new infections has declined 
by 80 percent. The decline is in part attributed to the blood 
collection establishments' implementation of a donor screening test 
(HCV enzyme linked

[[Page 48564]]

immunosorbent assay (EIA) screening test) that was licensed in May 
1990. In 1996, however, data from the Third National Health and 
Nutritional Examination Survey conducted from 1988 to 1994 indicated 
that approximately 3 million individuals in the United States were 
believed to have been chronically infected with HCV and that 
chronically infected persons might not be aware of their infection.
    Despite progression of the disease, HCV infection is often 
asymptomatic for about 20 years, but in many cases eventually causes 
serious liver injury that is thought to be a leading cause of end stage 
liver disease among adults in the United States. HCV is also thought to 
play a significant role in the development of liver cancer. Between 
8,000 and 12,000 deaths annually result from HCV-related chronic liver 
disease.
    HCV can be transmitted in a number of ways, including sharing of 
drug use equipment among injection drug users, blood transfusion and 
solid organ transplants from infectious donors, exposure to infectious 
blood or body fluids in healthcare settings (for example, hemodialysis 
or occupational exposure to blood), perinatal exposure of infants to 
infected mothers, and possibly by unprotected sex.
    In response to scientific data that show that HCV is transmissible 
through blood and blood components, FDA has implemented an extensive 
system of donor screening and testing procedures performed before, 
during, and after a donation takes place to help prevent the 
transfusion of blood and blood components that are infected with HCV.
    Blood collecting establishments are currently testing each donation 
of blood and blood components for evidence of HCV infection. Current 
testing for HCV includes antibody screening, as well as direct viral 
detection through the current use of nucleic acid tests (NAT). FDA 
restricts the use of donations that test reactive for evidence of HCV 
infection for transfusion or further manufacture. (The term 
``repeatedly reactive'' has been used to indicate that the initial HCV 
antibody screening test is reactive (in which case it is retested in 
duplicate), and that one or both of the duplicate tests are reactive.) 
FDA now refers to screening tests as ``reactive,'' instead of 
``repeatedly reactive'' to accommodate the different testing algorithms 
established for NAT and other screening tests. In cases where the 
screening algorithm requires initial and repeat testing as part of a 
single screening procedure, FDA would interpret the term ``reactive'' 
to mean ``repeatedly reactive.''
    As a result of blood donor screening and testing procedures, the 
risk of transmitting HCV infections through blood transfusion is very 
low. Despite the best practices of blood establishments, however, a 
person may donate blood early in the infection process when the 
testable marker to HCV is not detectable by the test but HCV is 
nevertheless present in the donor's blood (called a ``window'' period).
    If the donor later tests reactive for evidence of HCV infection, or 
when the blood collecting establishment is made aware of other reliable 
test results or information indicating evidence of HCV infection, 
previously collected blood and blood components would be at increased 
risk for transmitting HCV. We believe that approximately 7 percent of 
the estimated 3.9 million Americans ever infected with HCV were 
infected as a result of transfusion of blood components before the 
availability of donor screening tests or due to past use of non-viral-
inactivated plasma derivative products.
    As a result of advances in identifying the presence of HCV, most 
notably through screening tests based on nucleic acid amplification 
technology, the window period and risk of HCV transmission from blood 
continues to shrink. The preamble to FDA's proposed rule entitled 
``Current Good Manufacturing Practice for Blood and Blood Components: 
Notification of Consignees and Transfusion Recipients Receiving Blood 
and Blood Components at Increased Risk of Transmitting HCV Infection 
(lookback),'' published on November 16, 2000 (65 FR 69378), and FDA's 
final rule published elsewhere in this issue of the Federal Register 
provide more information on the length of the window period and discuss 
various diagnostic modalities for HCV infection.
    The incidence of transfusion-transmitted HCV infection has 
decreased markedly since the implementation of donor screening and 
testing for HCV, and viral inactivation of derivatives. Blood 
establishments implemented donor screening tests after a single 
antigen, enzyme linked immunosorbent assay (EIA) for antibody to HCV 
(HCV EIA 1.0 screening test) was licensed in May 1990. The FDA issued a 
memorandum to all registered blood establishments in November 1990, 
``Testing for the Antibody to Hepatitis C Virus Encoded Antigen (Anti-
HCV),'' recommending use of approved donor screening tests for antibody 
to HCV. A lookback program was not recommended at that time because: 
(1) Screening tests available at the time could not distinguish between 
on-going infection and recovery, thus making unclear the meaning of a 
reactive test for any one individual; (2) donor screening for the 
antibody to HCV did not include confirmatory testing, and most 
notification would have been based on false positive donor test 
results; (3) there was limited knowledge of routes of transmission for 
HCV other than parenteral; and (4) no potential long-term benefits of 
therapy were known.
    A significantly more sensitive multiantigen screening test (HCV EIA 
2.0 screening test) was licensed in March 1992. In June 1993, FDA 
licensed an HCV 2.0 strip immunoblot assay (HCV RIBA 2.0), also known 
as recombinant immunoblot assay (RIBA), a supplemental test for 
antibody to HCV. Supplemental tests for HCV antibodies are used to 
counsel and resolve the donor's status. Following the December 1993 
BPAC meeting, BPAC recommended product quarantine of prior collections 
from a donor who later tests repeatedly reactive for the antibody to 
HCV and tests positive or indeterminate on a supplemental test; 
however, BPAC only marginally endorsed consignee notification for the 
purpose of transfusion recipient notification because the public health 
benefit of the notification was not clear.
    The Public Health Service Advisory Committee on Blood Safety and 
Availability (PHS Advisory Committee) discussed improvements in the 
treatment and management of HCV infection and improvements in testing 
for the antibody to HCV at public meetings held on April 24, 1997 and 
on August 11 and 12, 1997. The PHS Advisory Committee also discussed 
the public health benefits of notifying transfusion recipients 
receiving prior collections from a donor who subsequently tests 
repeatedly reactive for evidence of HCV infection. Following the 
Department of Health and Human Services' acceptance of recommendations 
from the PHS Advisory Committee, the FDA developed guidance, published 
in March 1998, regarding procedures for testing blood for HCV, 
quarantining blood and blood components, and notifying patients who may 
have received HCV-infected blood and blood components.
    In response to comments received, the March 1998 guidance was 
withdrawn and FDA issued a revised guidance dated September 1998, which 
it announced in the Federal Register on October 21, 1998 (63 FR 56198), 
entitled ``Guidance for Industry: Current Good Manufacturing Practice 
for Blood and

[[Page 48565]]

Blood Components: (1) Quarantine and Disposition of Units From Prior 
Collections From Donors With Repeatedly Reactive Screening Test for 
Antibody to Hepatitis C Virus (Anti-HCV); (2) Supplemental Testing, and 
the Notification of Consignees and Blood Recipients of Donor Test 
Results for Anti-HCV'' (the September 1998 guidance). The September 
1998 guidance provided recommendations to enable quarantine and 
disposition of blood and blood components from prior collections from 
donors with repeatedly reactive screening test results.
    At public meetings on November 24, 1998 and January 28, 1999, the 
PHS Advisory Committee reconsidered the issue of recipient notification 
related to repeatedly reactive results on the single antigen screening 
test. The PHS Advisory Committee recommended that targeted lookback 
should be initiated based on a repeatedly reactive HCV EIA 1.0 
screening test result on a repeat donor unless a supplemental test was 
performed and the result did not indicate increased risk of HCV 
infection or, in the absence of a supplemental test result, unless the 
signal to cut off value of the repeatedly reactive HCV EIA 1.0 
screening test was less than 2.5 or follow-up testing of the donor was 
negative.
    The FDA published a notice in the Federal Register on June 22, 1999 
(64 FR 33309) announcing the availability of a revised draft guidance 
titled ``Draft Guidance for Industry: Current Good Manufacturing 
Practice for Blood and Blood Components: (1) Quarantine and Disposition 
of Prior Collections from Donors with Repeatedly Reactive Screening 
Tests for Hepatitis C Virus (HCV); (2) Supplemental Testing, and the 
Notification of Consignees and Transfusion Recipients of Donor Test 
Results for Antibody to HCV (Anti-HCV).'' Consistent with the 
recommendations of the PHS Advisory Committee, this revised draft 
guidance addressed lookback actions related to donor screening by HCV 
EIA 1.0 and also recommended that the search of historical testing 
records of prior donations from donors with repeatedly reactive EIA 
1.0, EIA 2.0, or EIA 3.0 screening tests for HCV should extend back 
indefinitely to the extent that electronic or other retrievable records 
exist.
    In October 2004 FDA issued a final guidance, ``Guidance for 
Industry: Use of Nucleic Acid Tests on Pooled and Individual Samples 
from Donors of Whole Blood and Blood Components (Including Source 
Plasma and Source Leukocytes) to Adequately and Appropriately Reduce 
the Risk of Transmission of Human Immunodeficiency Virus Type 1 and 
Hepatitis C Virus'' which was announced in the Federal Register on 
October 28, 2004 (69 FR 62902). The guidance informed blood collecting 
establishments that FDA had licensed NAT as tests to screen blood 
donors for HIV-1 RNA and HCV RNA, that the licensed tests could detect 
evidence of infection at a significantly earlier stage than was 
possible under previously approved tests using antibody or antigen 
detection technology, and that the FDA believed that these newly 
licensed tests were widely available and met the criteria in 21 CFR 
610.40(b) for screening tests that are necessary to reduce adequately 
and appropriately the risk of transmission of communicable disease 
through blood products.

II. Provisions of the Proposed Rule

    In order to have consistent industry standards for potentially 
infectious blood and blood components, on November 16, 2000 (65 FR 
69416), we proposed to adopt as our requirements for hospitals the 
procedures for HCV proposed by the FDA in that same Federal Register 
(65 FR 69378). Since our proposed rule was published in conjunction 
with the FDA's proposed rule, we have considered comments we received 
in conjunction with the FDA. We specifically requested in the proposed 
rule comments on the reasonableness of our adopting the FDA 
requirements.
    The FDA proposed rule for HCV lookback would require blood 
establishments (in this IFC we changed the reference of ``blood 
establishments'' to ``blood collecting establishments'' (BCE)) to 
search historical testing records of prior donations from donors with 
repeatedly reactive EIA 1.0, EIA 2.0, or EIA 3.0 screening tests for 
HCV, extending back indefinitely for computerized electronic records, 
and to January 1, 1988 for other retrievable records. Under the FDA 
rule, a BCE would be required to notify a hospital if it supplied such 
hospital with potentially HCV infectious blood.
    We proposed to amend the hospital conditions of participation to 
require a hospital to develop agreements with outside BCEs under which 
the BCE would notify the hospital if it supplied the hospital with 
potentially HCV infectious blood and blood components. We proposed to 
establish a lookback, similar to that now in effect for HIV, requiring 
hospitals, when notified by BCEs, to quarantine prior collections from 
a donor who later tested repeatedly reactive for evidence of HCV 
infection, and to notify transfusion recipients of the prior 
collections, based on further testing of the donor, as appropriate.
    We proposed to remove current paragraph (a) in the existing Sec.  
482.27 and re-designate paragraphs (b) and (c) as (a) and (b), 
respectively. In addition, we proposed adding a definition of 
``potentially HCV infected blood and blood components'' as previous 
collections from a donor--(1) Who tested repeatedly reactive for 
evidence of HCV infection on a single antigen screening test with a 
signal to cut off value equal to or greater than 2.5 for at least two 
of the three EIA tests, or when the signal to cut off value for such 
donor could not be calculated, with no record of further testing; (2) 
who tested repeatedly reactive for evidence of HCV infection and 
positive on a multiantigen supplemental test licensed at an earlier or 
later date by FDA; (3) who tested repeatedly reactive for evidence of 
HCV infection and indeterminate on a supplemental test for HCV, unless 
an indeterminate RIBA 3.0 supplemental test result was obtained or a 
negative EIA 3.0 or negative RIBA 3.0 test result was subsequently 
obtained; (4) who tested repeatedly reactive for evidence of HCV 
infection on a multiantigen screening test with no record of further 
testing; or (5) who tested repeatedly reactive for evidence of HCV 
infection on a single antigen screening test and repeatedly reactive on 
a subsequent multiantigen screening test, unless a negative 
supplemental test result or an indeterminate RIBA 3.0 supplemental test 
result was obtained. (See proposed Sec.  482.27(b)(2).)
    Our regulations currently require a hospital that regularly uses 
the services of an outside BCE to have an agreement with the BCE that 
requires the establishment to notify the hospital if the establishment 
has supplied the hospital with potentially HIV infected blood. We 
proposed to amend that provision to also require notification in the 
case of potentially HCV infected blood. (See proposed Sec.  
482.27(b)(3).) In addition, we proposed to revise our regulations to 
include HCV-relevant testing required by FDA. (See proposed Sec.  
482.27(b)(3)(ii).)
    We also proposed conforming changes to the HIV requirement at Sec.  
482.27(b)(3)(i) by removing the word ``promptly'' and instead require 
that a blood bank notify a hospital of potentially infected blood 
within 3 calendar days after testing. Also, hospitals would have been 
required to make at least three attempts to notify the patient, or to 
notify the attending physician who ordered the blood or blood 
components.

[[Page 48566]]

    We proposed additional conforming changes that would have required 
a hospital's agreement with a BCE to require the BCE to notify the 
hospital within 3 calendar days of testing if blood tested repeatedly 
reactive for HCV antibodies. This change provides further clarity of 
the notification requirement.
    The FDA proposed a change to the maximum time permitted for a BCE 
to notify hospitals of the results of the further testing, from 30 to 
45 days, in order to create consistency between the HIV and HCV 
lookback provisions. Although FDA has stated that further testing for 
HIV and HCV could be completed within 30 days, additional time was 
needed to notify hospitals following completion of the further testing. 
We proposed the appropriate changes to Sec.  482.27(b)(3)(ii) to 
include the change from 30 to 45 days in the agreement a hospital had 
with a BCE.
    In Sec.  482.27(c)(3)(i) and (ii) regarding follow-up testing, we 
proposed deleting the words in Sec.  482.27(b)(1)(ii) to reflect that 
the additional follow-up testing was an FDA requirement and not a 
recommendation.
    As a new provision, we proposed that hospitals be required to 
include in agreements with BCEs a provision requiring the BCE to notify 
the hospital of lookback results under FDA's proposed 21 CFR 
610.48(h)(3)(i) and (h)(3)(ii), and (i)(3)(i) and (i)(3)(ii). FDA 
proposed that hospitals perform a lookback of blood or blood components 
collected from a donor extending back indefinitely for computerized 
electronic records and to January 1, 1988 for other retrievable 
records, or to the date 12 months before the donor's most recent 
negative multiantigen screening test for the antibody to HCV, whichever 
is the later date.
    We also proposed to revise our regulations to apply the provisions 
regarding the quarantine of potentially HIV infectious blood and blood 
components currently set forth at Sec.  482.27(c)(3) to potentially HCV 
infected blood and blood components. (See proposed Sec.  482.27(b)(4).) 
In addition, we proposed requiring hospitals to destroy or re-label 
previous collections of blood or blood components held in quarantine if 
the results of the testing were indeterminate. We proposed that 
hospitals re-label previous collections of blood or blood components 
held in quarantine if the results of the testing were indeterminate, in 
accordance with the FDA regulations at 21 CFR 606.121 and the HCV 
Lookback Guidance Documents.
    We proposed a change to Sec.  482.27(b)(4) by adding a 
parenthetical phrase ``(either internal or under an agreement).'' We 
proposed this change to clarify that a blood collecting establishment 
has a responsibility to notify the hospital of HIV or HCV screening 
results even when located at a hospital site.
    Hospitals are currently required to maintain clinical records on 
all patients for 5 years. We proposed adding a new provision requiring 
hospitals to maintain adequate records of the source and disposition of 
all units of blood and blood components for at least 10 years after the 
date of disposition. The FDA also proposed to increase record retention 
requirements for blood establishments from 5 years to 10 years. 
Hospitals would be required to increase the record retention period 
yearly until 10 years of records from the date of disposition had 
accrued. (For example, the first year after the effective date of this 
regulation, hospitals would have had 6 years of records, the second 
year after the effective date, 7 years, and so on until 10 years had 
been reached.) Hospitals would then have been able and expected to 
maintain 10 years of patient records. (See proposed Sec.  
482.27(b)(5).) We believed this would be necessary to increase 
opportunities for disease prevention or treatment years after a 
recipient had been exposed to a donor later determined to be at risk of 
transmitting the disease through transfusion. We proposed, as is 
currently required at Sec.  482.24(b)(2), that hospitals maintain the 
clinical records in such a manner that would permit prompt retrieval. 
We also had proposed that hospitals ensure that medical records would 
be transferred to another hospital or other entity if the former 
hospital ceased operation for any reason. (See proposed Sec.  
482.27(b)(5)(iii).)
    The FDA had proposed changes in its requirement for patient 
notification to allow transfusion services to make three attempts to 
either notify patients directly or notify the attending physician or 
the physician who ordered the blood. We proposed that hospitals follow 
the same notification procedures with regard to potentially HIV and HCV 
infectious blood and blood components. For consistency, we also 
proposed that the HIV lookback requirements be changed to conform to 
the requirements for HCV lookback.
    We had proposed adding a new paragraph (c) requiring hospitals to 
comply with FDA regulations pertaining to the appropriate testing and 
quarantining of infectious blood and blood components and to the 
notification and counseling of recipients who may receive any 
infectious blood and blood components that are identified after the 
publication of this rule.
    Note that our Medicaid regulations at Sec.  441.17 (``Laboratory 
services'') provide that the State plan must pay for laboratory 
services furnished by a hospital-based laboratory meeting the 
requirements for Medicare participation set forth in Sec.  482.27. 
Therefore, the provisions of this interim final rule with comment 
period will also affect the Medicaid program. That is, in order for the 
laboratory services furnished by a hospital-based laboratory under 
Medicaid to be covered under the State plan, the hospital will have to 
meet the new requirements set forth in this rule.

III. Analysis of and Responses to Public Comments

    While we are not issuing a new proposed rule as would otherwise be 
required under section 1871(a)(3)(B) of the Act, we are considering 
comments we received on the proposed rule published on November 16, 
2000 in this interim final rule with comment period. See section VI 
below for a more detailed discussion of our decision to publish this 
matter as an interim final rule with comment period.
    Six types of organizations, including blood banks, blood centers, 
the blood industry trade association, and hospitals, submitted comments 
raising several issues with the proposed rule. The main concerns were 
with the proposed requirement to make three attempts to notify affected 
transfusion recipients and the requirement to notify the deceased's 
relative of possible HCV infection.
    Both CMS and the FDA received comments related to the complex and 
prescriptive language in their respective proposed rules. As we stated 
in section II of this rule, we also reviewed the comments and responses 
that the FDA received, and we have coordinated our responses with the 
FDA.
    Comment: One commenter disagreed with adding specific language 
about the test method in the interim final rule with comment period, 
stating that the methodology could be obsolete in a few years.
    Response: We agree with the commenter that including specific 
testing methods in this interim final rule with comment period is too 
restrictive. We have changed the regulation at Sec.  482.27(b)(2) to 
reference 21 CFR 610.47, which describes blood and blood components 
subject to HCV lookback.
    Comment: Several commenters disagreed with our proposal to require 
a hospital to notify a patient's legal

[[Page 48567]]

guardian or relative of possible HCV exposure after a patient had 
already died (of any cause). They noted that there are no clear 
indications of risk to household contacts of patients with HCV. They 
request that Sec.  482.27(b)(10) be deleted.
    Response: We agree with respect to HCV. As previously discussed in 
both the FDA and CMS's rules, direct percutaneous exposure to infected 
blood, particularly in the setting of drug abuse, accounts for the 
majority of HCV infections acquired in the United States. Secondary 
transmission of HCV to sexual partners, care providers, or others with 
close contact is very unlikely. The proposed rule implies that 
notification efforts should be continued for HCV transmissions if the 
recipient is deceased. We will clarify that if the patient is deceased, 
the requirement to notify the legal guardian or relative of possible 
exposure applies only to HIV infection and not HCV infection. We have 
changed Sec.  482.27(b)(10) to reflect the clarification.
    Comment: One commenter stated that since the FDA requires that all 
blood donors and donated transfusions are screened, the risks of 
transmission through blood transfusions are currently very low. The 
commenter stated that there does not appear to be a need to increase 
the regulatory burden on hospitals because the problem of HCV 
transmission in hospitals by blood transfusion and tissue transplant 
has been effectively solved. The commenter stated that the proposed 
regulation should be withdrawn.
    Response: We understand that due to advanced screening techniques 
and the fact that hospitals are currently following the FDA's industry 
guidelines on HCV testing and quarantining of blood and blood 
components that test reactive for evidence of HCV infection, the risk 
of transmitting HCV through blood transfusions or administration has 
been greatly reduced. In addition to reducing the risk of current and 
future HCV transmission, this rule will ensure that hospitals 
appropriately notify those Americans who may have been infected with 
HCV as a result of transfusion of blood components before the broad 
availability of donor screening tests in 1990. It is important that 
these individuals are notified of the need for HCV testing and 
counseling. HCV infection is usually asymptomatic for about 20 years, 
but may cause serious liver injury that is thought to be a leading 
cause of end stage liver disease among adults in the United States. HCV 
is also thought to play a role in the development of liver cancer. 
Between 8,000 and 12,000 deaths annually result from HCV-related 
chronic liver disease.
    This interim final rule with comment period also increases the 
medical record retention period from 5 to 10 years. The FDA has 
recommended that the records retention period be increased because 
advances in medical diagnosis and therapy have created opportunities 
for disease prevention or treatment many years after recipient exposure 
to a donor later determined to be at increased risk of transfusion 
transmitted disease.
    Comment: One commenter stated that the burden of 16 hours for a 
hospital to develop the required procedures and establish the contract 
with the BCE is underestimated. They also stated that the estimated 
cost of $52,653,004 for recipient notification is very low.
    Response: As stated in the proposed rule, we currently require 
hospitals that receive blood from an outside BCE to have an agreement 
with the BCE that governs the procurement, transfer, and availability 
of blood and blood components for HIV. We do not envision that 
hospitals need a separate or different agreement for HCV. Hospitals 
will only need to modify their current agreement to include potentially 
HCV infected blood and blood components. Also, hospitals currently have 
procedures in place to conduct HIV lookback activities. We think that 
16 hours, as stated in the proposed rule, will provide adequate time to 
incorporate similar procedures for conducting HCV lookback activities.
    We agree with the commenter regarding the cost for recipient 
notification. Based on the recent Bureau of Labor Statistics estimates, 
we have increased the cost for recipient notification. We have 
increased the hourly wage for a staff medical technologist performing 
the review from $25.67 to $33.84. Each hospital will incur a one-time 
cost of $541.44, or about $2.7 million for the entire industry to 
develop HCV lookback procedures. Thus, the total one-time cost to 
hospitals for conducting the historical (retrospective) lookback 
efforts is estimated to be $41.6 million ($2.7 million to develop 
procedures and $38.9 million for recipient notification). The 
calculations are based on the latest data available related to 
hospitals and number of recipients that may need notification. There 
are approximately 4,980 Medicare- and Medicaid-participating hospitals, 
excluding 1,041 hospitals that operate blood collection centers, 
because they are counted among the collection establishments. The CDC 
estimated in 2000 that 212,000 recipients may need to be notified due 
to the historical review.
    Comment: One commenter stated that there is no reason for blood 
records to be kept for 10 years, stating that there is no reason for 
such records to be kept on a different basis than any other medical 
records. Having special rules for this narrow class of records will 
only lead to confusion. Several commenters agreed with requiring 
hospitals to maintain adequate records of the source and disposition of 
all units of blood and blood components for at least 10 years from the 
date of disposition, but recommended that the retention period be 
phased in.
    Response: We maintain that increasing the record retention period 
from 5 to 10 years will increase opportunities for disease prevention 
or treatment years after a recipient has been exposed to a donor that 
is later determined to be at risk of transmitting a disease through 
transfusion. In addition, advanced technology has improved the 
hospital's ability to maintain, store, and retrieve records.
    The record retention period will be phased in as described above in 
Section II, ``Provisions of the Proposed Regulation.'' Hospitals will 
be required to increase the record retention period yearly until 10 
years of records from the date of disposition have accrued.
    Comment: Several commenters agree that the hospital should directly 
notify the patient, the attending physician, or the physician who 
ordered the blood and blood component of HCV infection. However, they 
disagree with requiring, at a minimum, three attempts to notify the 
patient. They stated that only one notification attempt should be made 
using a traceable method such as certified mail or return receipt. A 
returned letter should be proof that notification was attempted and was 
unsuccessful, and that further attempts would be unsuccessful as well. 
However, one commenter disagrees with requiring just one notification 
attempt by certified mail. The commenter stated that there are 
individuals who will not claim a certified letter.
    Response: We agree that some individuals are reluctant to take 
possession of a certified letter. We have clarified in the interim 
final rule with comment period at 482.27(b)(6)(i) and (b)(7) that the 
hospital must make reasonable attempts to perform the notification 
within 12 weeks after being notified by the BCE that it has received 
potentially HIV or HCV infectious blood and blood components. The 
hospital will be required to notify the recipient, recipient's 
physician of record, or a legal representative or relative if the 
recipient is a minor or adjudged incompetent by a State court.

[[Page 48568]]

    Comment: Several commenters stated that it is important for both 
CMS' and FDA's requirements for HCV and HIV lookbacks to be identical 
in order to ensure that the targeted lookbacks are carried out in a 
uniform manner throughout the United States.
    Response: We appreciate the comments supporting a unified targeted 
lookback effort. It is important to have consistent industry standards 
for maintaining the safety of the nation's blood supply. As previously 
stated, we have collaborated with the FDA in developing and responding 
to the comments received on the proposed rule.
    Comment: A commenter stated that the time-frame for non-
computerized retrievable records should be from January 1, 1988 instead 
of January 1, 1998.
    Response: After the effective date of this rule, whenever a 
hospital or other BCE receives a blood donation that tests infectious 
for HCV, it must perform a lookback as far back as the period described 
above (that is, 1988 or to the extent of electronic records), to 
determine if that donor had previously given blood. If the donor's most 
recent previous donation (before the current infectious donation) 
tested non-reactive (that is, uninfected), or tested reactive on a 
viral detection test (for instance, the nucleic acid test) but non-
reactive on the associated antibody screening test on that previous 
occasion, the hospital and/or BCE must review the record for the 12 
months previous to the earlier donation test, to determine if there 
were any donations during that 12-month period, and to determine if 
those blood products are still available for use. If so, all such blood 
products still available for consignment/use 12 months and less before 
that previous donation must be quarantined retested, and the consignees 
of the blood products notified.

IV. Provisions of the Interim Final Rule With Comment Period

    For the most part, this interim final rule with comment period 
incorporates the provisions of the November, 2000 proposed rule. As 
discussed in section III, ``Analysis of and Responses to Public 
Comments,'' we have made minor changes to the proposed rule at Sec.  
482.27(b)(2), (6), (7), and (10). We have added Sec.  482.27(b)(11) to 
establish a cut-off date for retrospective HCV lookback.
    In Sec.  482.27(b)(2), we removed language that we determined, 
based on public comment, to be too restrictive. That language was 
replaced with a reference to FDA's regulations in 21 CFR 610.47.
    In Sec.  482.27(b)(3)(i) through (iii), we made changes to the 
regulation citations to conform to the FDA rule.
    In Sec.  482.27(b)(6) and (7), we changed the proposed requirement 
that the hospital make three attempts to notify the patient or 
physician of record that potentially infectious blood was transfused to 
the patient. Instead, we are requiring the hospital to make reasonable 
attempts to notify the recipient or the physician of record. We 
emphasize that a hospital should continue attempting its notification 
efforts until it is clear that further attempts would not be 
successful.
    In Sec.  482.27(b)(10), we have revised the language to clarify 
that if a patient is deceased, the requirement to notify a legal 
guardian or relative of possible exposure applies only to HIV infection 
and not to HCV infection.
    We have made changes to the interim final rule with comment period 
in Sec.  482.27(b)(11) to conform with the FDA's rule at Sec.  610.48 
whereby a cut-off date has been established for the retrospective 
lookback. As such, we have established a cut-off date in this rule for 
the retrospective (historical) HCV lookback. The requirement under 
Sec.  482.27(b) will remain in effect for 8 years after the date of 
publication in the Federal Register.
    We clarified the regulation at Sec.  482.27(c) by stating that the 
lookback activities discussed in this section are related only to new 
blood safety issues that are identified after the publication of this 
rule. Hospitals should comply with the FDA regulations pertaining to 
the appropriate testing and quarantining of infectious blood and blood 
components, and to the notification and counseling of recipients who 
may receive any infectious blood and blood components.

V. Response to Comments

    Because of the large number of public comments we normally receive 
on Federal Register documents, 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.

VI. Waiver of Proposed Rulemaking

    Section 1871(a)(3) of the Act (as added by section 902 of the 
Medicare Prescription Drug, Improvement, and Modernization Act of 2003 
(MMA)) provides that, effective December 8, 2003, the Secretary, in 
consultation with the Director of the Office of Management and Budget 
(OMB), shall establish and publish a regular timeline for the 
publication of Medicare final regulations based on the previous 
publication of a proposed regulation or an interim final regulation. 
Section 1871(a)(3)(B) of the Act further provides that such timelines 
may vary among different regulations, but shall not be longer than 3 
years except under exceptional circumstances. As noted above, CMS 
published a proposed rule regarding Hepatitis C Virus and blood 
collecting establishments on November 16, 2000. On December 30, 2004, 
we published a notice in the Federal Register implementing section 
1871(a)(3) of the Act (68 FR 78442). In that notice, we interpreted the 
effect of that section as generally rendering legally inoperative 
Medicare proposed rules that were over 3 years old on the MMA's 
effective date. Therefore, since 3 years had already elapsed since 
publication of the November, 2000 NPRM on December 8, 2003, we believe 
that the 2000 NPRM became legally ineffective as of that date. 
Accordingly, even though we sought and received extensive comments on 
this interim final rule with comment period in response to the 2000 
proposed rule, we are not publishing this rule as a final rule.
    Under such circumstances, we ordinarily would publish a new 
proposed rule in the Federal Register and invite public comment on the 
proposed rule. The proposed rule would include a reference to the legal 
authority under which the rule was 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.
    We are waiving publishing a proposed rule, and instead publishing 
this rule as an interim final rule with comment period. We are 
specifically going forward because of the importance of keeping this 
document coordinated with the FDA's lookback rule covering blood 
establishments, and the present danger to lives and health of 
individuals that arise from unknown contaminants in the nation's blood 
supply. Section 1871(a)(3) of the Act does not prohibit us from issuing 
an interim final rule with comment period based on the expired proposed 
rule, as long as we issue a final rule no later than 3 years after the 
interim final rule's publication

[[Page 48569]]

date (or publish in the Federal Register a notice extending the 
period).
    The FDA's final rule and CMS's interim final rule on blood safety 
are very closely related and dependent upon each other. However, the 
FDA is not restricted by this section of the MMA (which applies only to 
Medicare rules) and therefore is also issuing its final rule in this 
issue of the Federal Register. We believe that it would not be in the 
best interest of the public for the FDA to publish a final rule 
requiring blood establishments to notify hospitals of infectious blood 
and blood products and CMS not to require hospitals to perform the 
necessary lookback activities of notifying transfusion recipients of 
the need for HCV testing and counseling.
    For the FDA's rule to be effective practically, it is therefore 
necessary that we issue a companion interim final rule with comment 
period that covers transfusion services and further supports the 
notification of recipients of blood and blood components that are at 
increased risk of infection and transmission of HCV.
    Therefore, we find good cause to waive the publication of a 
proposed rule and to issue this interim final rule with comment period. 
We are providing a 60-day public comment period.

VII. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 30-day notice in the Federal Register and solicit public 
comment when a collection of information requirement is 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 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.
    We are soliciting public comment on each of these issues for the 
following sections of this document that contain information collection 
requirements (ICRs):

Section 482.27 Condition of Participation: Laboratory Services

    Section 482.27(b)(3) requires a hospital that regularly uses the 
services of an outside BCE to establish and maintain a written 
agreement with the BCE that governs the procurement, transfer, and 
availability of blood and blood components. This section also requires 
the BCE to notify the hospital within 3 calendar days after the date on 
which the donor tested reactive for evidence of HCV infection or after 
the date on which the blood establishment was made aware of other test 
results indicating evidence of HCV infection, as outlined in (b)(3)(i) 
through (iii).
    Section 482.27(b)(5) requires a hospital to maintain, in a manner 
that permits prompt retrieval, adequate records of the source and 
disposition of all units of blood and blood components for at least 10 
years from the date of disposition. In addition, this section requires 
a hospital to maintain a fully funded and documented plan that will 
allow the hospital to transfer these records to another hospital or 
other entity if such hospital ceases operation for any reason.
    Section 482.27(b)(6) requires a hospital that has administered 
potentially HIV or HCV infectious blood or blood components (either 
directly through its own BCE or under an agreement), or released the 
blood or blood components to another entity or individual, to make 
reasonable attempts to notify the patient, or to notify the attending 
physician or the physician who ordered the blood or blood component and 
ask the physician to notify the patient, that potentially HIV or HCV 
infectious blood or blood components were transfused to the patient. 
Time frame and notification requirements are outlined in Sec.  
482.27(b)(6), (b)(7), and (b)(8).
    Section 482.27(b)(9) requires a hospital to maintain policies and 
procedures for notification and documentation that conform to Federal, 
State, and local laws, including requirements for the confidentiality 
of medical records.
    Section 482.27(b)(10) requires a physician or hospital, if the 
patient has been adjudged incompetent by a State court, to notify a 
legal representative designated in accordance with State law. If the 
patient is competent, but State law permits a legal representative or 
relative to receive the information on the patient's behalf, the 
physician or hospital must notify the patient or his or her legal 
representative or relative. If the patient is deceased, the physician 
or hospital must continue the notification process for HIV infection 
and inform the deceased patient's legal representative or relative. If 
the patient is a minor, the legal guardian must be notified.
    While all of the information collection requirements referenced 
above are subject to the Paperwork Reduction Act, the burden associated 
with these requirements is captured and discussed in the FDA's final 
regulation titled ``Current Good Manufacturing Practice for Blood and 
Blood Components: Notification of Consignees and Transfusion Recipients 
Receiving Blood and Blood Components at Increased Risk of Transmitting 
HCV Infection'' published elsewhere in today's Federal Register. 
Therefore, we are assigning 1 token hour of burden to these 
requirements.
    The FDA's rule assigns a one-time burden of 16 hours for hospitals 
to develop procedures to conduct lookback activities. We also require 
hospitals that currently receive blood from an outside BCE to have an 
agreement with the BCE that governs the procurement, transfer, and 
availability of blood and blood components for HIV. Our rule requires 
hospitals to modify their current agreements to include HCV. Although 
the FDA does not require hospitals to have an agreement with a BCE, we 
believe that the time necessary to perform this task will be minimal 
and is already captured in the 16 hours allotted in the FDA rule.
    We received a comment that the burden of 16 hours for a hospital to 
develop the required procedures and establish the contract with the BCE 
is underestimated. This interim final rule with comment period will 
require a hospital to make minor modifications to the current agreement 
they have with the BCE for HIV. Therefore, we disagree with the comment 
that the 16 hours is not adequate to develop procedures to conduct 
lookback activities and modify their agreement with the BCE.
    We have submitted a copy of this interim final rule with comment 
period to OMB for its review of the information collection 
requirements. These requirements are not effective until they have been 
approved by OMB. A notice will be published in the Federal Register 
when we receive approval.
    If you comment on any of these information collection and record 
keeping requirements, please mail copies directly to the following: 
Centers for Medicare and Medicaid Services, Office of Strategic 
Operations and Regulatory Affairs, Regulations Development Group, Attn: 
Melissa Musotto, CMS-3014-IFC, Room C4-26-05, 7500 Security Boulevard, 
Baltimore, MD 21244-1850; and Office of

[[Page 48570]]

Information and Regulatory Affairs, Office of Management and Budget, 
Room 10235, New Executive Office Building, Washington, DC 20503, Attn: 
Carolyn Lovett, CMS Desk Officer, CMS-3014-IFC, [email protected]. Fax (202) 395-6974.

VIII. Regulatory Impact Analysis

A. Overall Impact

    We have examined the impacts of this interim final rule with 
comment period 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 (as amended by Executive Order 13258, which 
merely reassigns responsibility of duties) 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). 
Because the projected cost of this rule falls below the threshold for a 
major rule, we have determined that this rule is not a major rule.
    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 small governmental 
jurisdictions. Most hospitals and most other providers and suppliers 
are small entities, either by nonprofit status or by having revenues of 
less than $31.5 million in any 1 year. For purposes of the RFA, a 
majority of hospitals are considered small entities due to their non-
profit status. The agency has examined the impact on small entities and 
has determined that this rule will not have a significant economic 
impact on a substantial number of small entities. Individuals and 
States are not included in the definition of a small entity.
    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 (superseded by ``core-based statistical areas'' 
(CBSAs)) and has fewer than 100 beds. Because of the lack of 
information to characterize the number and volume of affected blood and 
blood components in small rural hospitals, we have prepared an analysis 
that is consistent with section 604 of the RFA.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. That threshold 
level is currently approximately $122 million. We believe that this 
interim final rule with comment period is not an economically 
significant rule as described in the Executive Order, or a significant 
action as defined in the Unfunded Mandates Reform Act. Aggregate 
impacts of the rule, and aggregate expenditures caused by the rule will 
not reach $120 million for either the public or the private sector. As 
discussed in the following paragraphs, because of the lack of 
information to characterize the number and volumes of affected blood 
and blood components in hospitals that might qualify as small entities, 
the impact on small entities is uncertain.
    It is clear that a number of hospitals that provide blood 
transfusions will be affected by the implementation of this interim 
final rule with comment period and that a substantial number of those 
entities will be required to make changes in their operations. For 
these reasons, we have prepared the following analysis. This analysis, 
in combination with the rest of the preamble, is consistent with the 
analysis set forth by the RFA.
    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 the rule does not contain 
policies that have substantial direct effects on the States, on the 
relationship between the National Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government. Accordingly, we have concluded that the rule does not 
contain policies that have federalism implications as defined in the 
Executive Order 13132 and, consequently, a federalism summary impact 
statement is not required.

B. Anticipated Effects

1. Effects on Hospitals
    This interim final rule with comment period requires hospitals that 
transfuse blood and blood components to (1) prepare and follow written 
procedures for appropriate action when it is determined that blood and 
blood components the hospitals received and transfused are at increased 
risk for transmitting HCV; (2) quarantine prior collections in 
inventory from a donor who is at increased risk for transmitting HCV 
infection; (3) notify transfusion recipients (and, where required, 
legal representatives or relatives), as appropriate, of the need for 
HCV testing and counseling; and (4) extend the records retention period 
to 10 years.
    This interim final rule with comment period will affect hospitals 
that transfuse blood and blood components. There are approximately 
4,980 Medicare- and Medicaid-participating hospitals, excluding 1,041 
hospitals that operate blood collection centers, because they are 
counted among the collection establishments. The CDC estimated in 2000 
that 212,000 recipients may need to be notified due to the historical 
review.
    Fixed Cost--Standard Operating Procedures and Record Review. This 
interim final rule with comment period is expected to generate one-time 
costs and some additional annual costs for hospitals. One-time costs 
include the development of procedures and policies for recipient 
notification and the agreement a hospital should have if it uses the 
services of an outside BCE. We assume that these tasks will involve a 
review of current procedures and policies (for example, for HIV 
lookback) and the adaptation or modification of current procedures and 
policies to address the provisions of this rule. We estimate, in 
consultation with the FDA, that the tasks will require an average of 16 
hours per facility.
    In the proposed rule, we estimated, based on the 1997 Bureau of 
Labor Statistics (BLS) estimates, that the total hourly compensation 
for a staff medical technologist is $25.67. We have revised the 
estimates to increase the hourly compensation to $33.84 to reflect the 
most recent BLS data. Each hospital will incur a one-time cost of 
$541.44 ($33.84 x 16 hours = $541.44). The total cost is about $2.7 
million ($541.44 x 4980 establishments = $2,696,371.) (See the table in 
this section.) The proposed rule would have required hospitals to make 
at least three attempts to notify the

[[Page 48571]]

transfusion recipient. Several commenters expressed concern that it 
would be unnecessary to continue notification attempts if the hospital 
had proof that notification was attempted and was unsuccessful and that 
further attempts would most likely be unsuccessful. Therefore, we have 
changed the prescriptive language about the number of attempts. 
However, hospitals must make a reasonable attempt to contact any 
affected transfusion recipient within a maximum of 12 weeks from the 
time they receive from the blood establishment the results of a donor's 
supplemental positive test for HCV.
    We did not receive comments on the initial estimate that it would 
cost $165 to comply with all of the lookback provisions for each 
affected component. However, based on a recent report the FDA received 
from Los Angeles County, a vendor was paid $118 per patient to abstract 
health records, locate and notify transfusion recipients, and to give 
pretest counseling. Therefore, the FDA has revised the cost for 
lookback activities. The FDA estimates that the product quarantine 
accounts for about 40 percent of the unit cost (that is, $66), and the 
recipient notification accounts for the other 60 percent of the unit 
cost (that is, $99). [EB2] Without other data from both the prospective 
and retrospective lookbacks, the FDA continues to use the $66 as the 
cost of product quarantine, but increased the cost of recipient 
notification from $99 to $118 based on the experience of Los Angeles 
County.
    Prospective HCV lookback. The FDA estimates (based on prevalence 
levels reported by the American Red Cross for 2000) about 2,400 
discrete components could trigger recipient notification (780 donations 
from HCV-infected donors x 3.1 components per donation). The CDC survey 
found that on average about 85 percent of the at-risk components sent 
to hospitals were transfused. For the analysis of the proposed rule, 
FDA assumed that no patient would receive more than one affected 
component. This assumption suggests that hospitals will quarantine 
about 2,400 components and attempt about 2,050 recipient notifications 
(780 HCV positive donors x 3.1 components per donor x 85 percent 
transfused). Because CMS inspected hospitals account for about 65 
percent to 75 percent of the number of transfusions, the annual costs 
for consignees to conduct the prospective lookback actions range from 
$260,000 to $300,000 (65 percent by CMS-inspected establishments x 
2,400 components annually triggering recipient notification x $66 per 
component quarantine plus 2050 components annually triggering recipient 
notification x $118 per recipient notification to 75 percent by CMS-
inspected establishments x 2,400 components annually triggering 
quarantine x $66 per component quarantine plus 2,050 components 
annually triggering recipient notification x $118 per recipient 
notification. (See the table in this section. The numbers in the table 
are rounded).
    Retrospective HCV lookback. For notifications resulting from donors 
tested before February 20, 2008 under 21 CFR 610.48(c), the hospital 
must complete the notification effort within 1 year from the time it 
receives notification from the blood establishment. The recipient 
notification provided by the hospital must include a basic explanation 
to the recipient, referral for counseling and further testing, and 
documentation of the notification or attempts to notify the attending 
physician or recipient. The estimated one-time cost of recipient 
notification associated with the review of historical testing records 
is $41.6 million. This is based on the FDA estimate of blood components 
of about 212,000 recipients identified for notification produced from 
donations, and the average cost of $184 ($66 + $118) for staff time per 
component for recipient notification. Thus, the total one-time cost to 
hospitals for conducting the historical (retrospective) lookback effort 
is estimated to be $38.9 million for recipient notification). (See the 
table in this section.)
    This interim final rule with comment period requires hospitals to 
increase the time they keep records from 5 to 10 years. Although we did 
not include the annual cost of keeping records for a longer period of 
time in the analysis for the proposed rule, we are including the cost 
in this interim final rule with comment period. The FDA has estimated 
in its final rule that it may take 40 hours for a computer programmer 
to perform routine maintenance of these additional records. At a wage 
of $34 per hour, including benefits, a hospital would spend an 
additional $1,360 annually to conform to this provision of the rule. 
However, according to the AABB (formerly knows as the American 
Association of Blood Banks), 80 percent of the establishments that 
transfuse blood are accredited by the AABB and already comply with 
their standards, including retaining records for 10 years. Taking AABB 
compliance into account, this analysis includes additional compliance 
costs for 20 percent of the transfusion facilities at a total annual 
cost of $1.4 million ($34.00 per hour x 40 hours x 4,980 hospitals x 20 
percent). The following table shows the estimated compliance cost of 
this interim final rule. We believe that hospitals will incur up to 
$1.7 million in annual compliance costs for the prospective lookback 
provisions and to retain records for 10 years, and up to $42 million in 
one-time costs for SOPs and the retrospective lookback based on 
historical review of records. The annualized costs of this interim 
final rule over 10 years at 3 and 7 percent interest rates will be $6.5 
and $7.6 million.

                  Summary of the Estimated Cost of This Interim Final Rule With Comment Period
----------------------------------------------------------------------------------------------------------------
                                                                                  Annualized costs  (millions of
                                      Number       One-time cost    Annual cost              dollars)
          Type of cost               affected      (millions of    (millions of  -------------------------------
                                                     dollars)        dollars)        3 percent       7 percent
----------------------------------------------------------------------------------------------------------------
Development of HCV lookback               *4,980            $2.7  ..............            $0.3            $0.4
 Procedures.....................
Prospective Review..............           4,980  ..............             0.3             0.3            $0.3
Historical Review (Retrospective           4,980           $38.9  ..............            $4.6            $5.5
 lookback)......................
Record Retention Retain records            4,980  ..............             1.4             1.4            $1.4
 for 10 years...................
                                 -------------------------------------------------------------------------------
    Total.......................  ..............           $41.6            $1.7            $6.5            $7.6
----------------------------------------------------------------------------------------------------------------
* Numbers are rounded. (Excluding 1,041 hospitals that operate blood collection centers, because they are
  counted among the collection establishments).
* The annualized cost is for a 10 year period.


[[Page 48572]]

2. Effects on Beneficiaries
    Timely notification of HCV infection benefits beneficiaries, both 
directly and indirectly, in several important ways. First, although 
factors predicting the severity of liver disease due to HCV have not 
been well defined, recent data indicate that increased alcohol intake 
is associated with more severe liver disease. According to CDC, even 
moderate amounts of alcohol in patients with chronic HCV might 
exacerbate liver disease. Consequently, an HCV-infected patient 
identified by the lookback program could minimize liver damage 
associated with alcohol consumption by restricting his or her intake.
    It is also important to note that identified infected patients will 
benefit from counseling and treatment with available therapies. Studies 
of patient characteristics and responsiveness to therapy indicate that 
when treatment is initiated early in an infection, the best and most 
cost effective outcomes are achieved. That is, best results are 
achieved if treatment is initiated earlier in the disease, when 
patients are younger and have not yet developed cirrhosis. For example, 
Bennett et al. showed that the years of life gained and cost 
effectiveness of interferon-alpha 2b treatment decreased as the age of 
the patient increased from 3.1 years at $500 per year of life (YLE) for 
20-year-old patients to 22 days at $62,000 per YLE for 70-year-old 
patients. The dollar amounts of $500 and $62,000 represent the cost 
effectiveness of the treatment when it is given at an earlier age.
    Finally, infected patients will be informed that they must not 
donate blood. The lookback program will, therefore, help to ensure the 
safety and continued availability of the national blood supply.
3. Effects on Medicare and Medicaid Programs
    This interim final rule with comment period will generate a one-
time cost to develop procedures for recipient notification. We estimate 
this cost to be $2.7 million. Finally, the total one-time cost for the 
development of HCV lookback procedures and for recipient notification 
associated with the review of historical testing records is estimated 
to be $41.6 million ($2.7 + $38.9). These one-time costs would likely 
be distributed among health programs as follows: Medicare, 33.3 
percent; private health insurance, 30.5 percent; Federal Medicaid, 9.8 
percent; State Medicaid, 5.8 percent; other private funds, 7.9 percent; 
other Federal funds, 6.9 percent; and other State and local funds, 5.7 
percent. The total Federal distribution would be 50 percent; that is, 
33.3 percent for Medicare, 9.8 percent for Medicaid, and 6.9 percent 
for other Federal sources. The degree to which the Federal programs 
fund these amounts will vary: Medicaid providers may be able to pass on 
costs through the States depending on the method of payment the State 
Medicaid program has adopted, while Medicare payments could be limited 
because of the hospital outpatient prospective payment system and 
increase only in accordance with specific rules regarding coverage of 
HCV testing for patients who have been exposed to HCV-infected blood, 
including those identified through the FDA lookback process.
    It is important to note that, although this interim final rule with 
comment period presents the costs that would be imposed on all payers 
of hospital services, including the Medicare and Medicaid programs, it 
merely conforms to the FDA's final rule and has no additional economic 
impact. We have simply restated the analysis performed in the FDA 
companion rule; both rules present the same total costs to hospitals.

C. Alternatives Considered

    The PHS Advisory Committee discussed improvements in the treatment 
and management of HCV infection and improvements in testing for the HCV 
antibody at public meetings held in April and August 1997. The PHS 
Advisory Committee recommended that blood establishments and hospitals 
notify previous recipients of blood components from donors who tested 
positive for HCV upon a subsequent donation.
    Following the Department of Health and Human Services' acceptance 
of recommendations from the PHS Advisory Committee, FDA developed 
industry guidance for testing blood for HCV, quarantining blood and 
blood components, and notifying patients who may have received HCV-
infected blood and blood components. We explored the possibility of 
using a program memorandum to notify hospitals that they must follow 
FDA guidance. We believe, however, that in order to protect the health 
and safety of beneficiaries, we should publish an enforceable 
regulation that will enable us to ensure compliance through the survey 
process.
    The FDA, in its final rule published elsewhere in this issue of the 
Federal Register, provides a lengthy discussion and cost-benefit 
analysis regarding a targeted lookback program compared to a general 
lookback program for HCV. Therefore, the following discussion considers 
some key elements of successful lookback efforts, describes certain 
challenges identified in lookback programs already in operation, and 
reviews the value of targeted recipient notification and treatment 
efforts.
    The lookback provisions of this interim final rule with comment 
period can be characterized as a targeted lookback program, meaning 
that the notification of infection risk is limited to, or targeted at, 
individuals identified as recipients of blood from donors subsequently 
found to test positive for HCV. This program is distinct from general 
lookback programs, which are aimed at all patients who received blood 
before the onset of screening and which include the recommendation that 
the patients be tested for evidence of infection. General and targeted 
lookback programs may be complementary. General lookback can be 
conducted in a variety of ways, including use of the broadcast media, 
education, and letter campaigns addressed to physicians or patients. By 
contrast, targeted lookback can only be performed successfully if the 
transfusion service is aware that the donor subsequently tested 
positive, if donor and product disposition records are available to 
link blood components with the identified donors, and if the physician 
or hospital knows the recipient's current whereabouts. Hospitals would 
locate recipient records for all transfused units from an affected 
donor and would have current recipient or physician address information 
available so that the hospitals could deliver notifications. Ideally, 
the recipient would be located, and would respond to the notification 
for testing and treatment, if appropriate.
    Despite the difficulties of implementing targeted lookback, it is 
considered a valuable means of reaching patients at high risk for HCV. 
For example, a comparison of Canadian efforts in targeted lookback with 
general lookback through physician and public education found that a 
large number of patients and families were unaware that the patient had 
ever received a transfusion while in the hospital. These recipients 
would not have been reached through the general lookback effort.
    Timely notification is important because studies of patient 
characteristics and responsiveness to therapy indicate that the best 
results are achieved if patients receive treatment when they are 
younger and have not yet developed cirrhosis. The primary treatment for 
chronic hepatitis C is combination therapy with standard or pegylated 
interferon alpha and ribavirin. Of those patients who undergo 
combination treatment, a reported 40 to

[[Page 48573]]

50 percent show a sustained response (SR) after 12 months of therapy. 
However, interferon alpha produces a wide array of adverse side 
effects, and some patients experience a relapse after therapy. Still, 
the benefits for patients identified for treatment through HCV lookback 
are likely to continue to increase as improved therapies are developed. 
FDA has recently approved the use of this combination therapy for HCV 
patients who suffer a relapse after initial therapy with interferon 
alone.
    As discussed in section I of this document, the BPAC and PHS 
Advisory Committee have met a number of times to discuss HCV testing 
and other issues related to HCV lookback. The PHS Advisory Committee 
made recommendations after considering alternative procedures to notify 
transfusion recipients. Alternative approaches for lookback are 
available but are not considered fully effective. Because of the 
importance of a safe national blood supply and because our mission is 
to protect the public health, we accepted the recommendations of the 
PHS Advisory Committee and did not select an alternative approach.

D. Conclusion

    In addition to the prospective HIV lookback that hospitals are 
currently required to perform, hospitals are also required to conduct a 
lookback of transfusion recipients of potentially HCV-infected blood. 
This interim final rule with comment period also requires hospitals to 
have in their agreements with BCEs that BCEs notify hospitals after 
performing their own FDA-mandated lookback. Therefore, we have prepared 
an analysis consistent with the analysis set forth by the RFA. We 
solicited public comments on the extent that these provisions will 
significantly economically affect any of the entities.
    We have reviewed this interim final rule with comment period under 
the threshold criteria of Executive Order 13132, Federalism. We have 
determined that it will 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 42 CFR Part 482

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

0
For the reasons set forth in the preamble 42 CFR part 482 is amended as 
set forth below:

PART 482--CONDITIONS OF PARTICIPATION FOR HOSPITALS

0
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).

0
2. Amend Sec.  482.27 by--
0
A. Removing the designation of paragraph (a).
0
B. Redesignating paragraphs (b) and (c) as paragraphs (a) and (b), 
respectively.
0
C. Revising re-designated paragraph (b).
0
D. Adding paragraph (c).
    The revisions and additions read as follows:


Sec.  482.27  Condition of participation: Laboratory services.

* * * * *
    (b) Standard: Potentially infectious blood and blood components--
(1) Potentially human immunodeficiency virus (HIV) infectious blood and 
blood components. Potentially HIV infectious blood and blood components 
are prior collections from a donor--
    (i) Who tested negative at the time of donation but tests reactive 
for evidence of HIV infection on a later donation;
    (ii) Who tests positive on the supplemental (additional, more 
specific) test or other follow-up testing required by FDA; and
    (iii) For whom the timing of seroconversion cannot be precisely 
estimated.
    (2) Potentially hepatitis C virus (HCV) infectious blood and blood 
components. Potentially HCV infectious blood and blood components are 
the blood and blood components identified in 21 CFR 610.47.
    (3) Services furnished by an outside blood collecting 
establishment. If a hospital regularly uses the services of an outside 
blood collecting establishment, it must have an agreement with the 
blood collecting establishment that governs the procurement, transfer, 
and availability of blood and blood components. The agreement must 
require that the blood collecting establishment notify the hospital--
    (i) Within 3 calendar days if the blood collecting establishment 
supplied blood and blood components collected from a donor who tested 
negative at the time of donation but tests reactive for evidence of HIV 
or HCV infection on a later donation or who is determined to be at 
increased risk for transmitting HIV or HCV infection;
    (ii) Within 45 days of the test, of the results of the supplemental 
(additional, more specific) test for HIV or HCV, as relevant, or other 
follow-up testing required by FDA; and
    (iii) Within 3 calendar days after the blood collecting 
establishment supplied blood and blood components collected from an 
infectious donor, whenever records are available, as set forth at 21 
CFR 610.48(b)(3).
    (4) Quarantine and disposition of blood and blood components 
pending completion of testing. If the blood collecting establishment 
(either internal or under an agreement) notifies the hospital of the 
reactive HIV or HCV screening test results, the hospital must determine 
the disposition of the blood or blood product and quarantine all blood 
and blood components from previous donations in inventory.
    (i) If the blood collecting establishment notifies the hospital 
that the result of the supplemental (additional, more specific) test or 
other follow-up testing required by FDA is negative, absent other 
informative test results, the hospital may release the blood and blood 
components from quarantine.
    (ii) If the blood collecting establishment notifies the hospital 
that the result of the supplemental, (additional, more specific) test 
or other follow-up testing required by FDA is positive, the hospital 
must--
    (A) Dispose of the blood and blood components; and
    (B) Notify the transfusion recipients as set forth in paragraph 
(b)(6) of this section.
    (iii) If the blood collecting establishment notifies the hospital 
that the result of the supplemental, (additional, more specific) test 
or other follow-up testing required by FDA is indeterminate, the 
hospital must destroy or label prior collections of blood or blood 
components held in quarantine as set forth at 21 CFR 610.46(b)(2), 
610.47(b)(2), and 610.48(c)(2).
    (5) Recordkeeping by the hospital. The hospital must maintain--
    (i) Records of the source and disposition of all units of blood and 
blood components for at least 10 years from the date of disposition in 
a manner that permits prompt retrieval; and
    (ii) A fully funded plan to transfer these records to another 
hospital or other entity if such hospital ceases operation for any 
reason.
    (6) Patient notification. If the hospital has administered 
potentially HIV or HCV infectious blood or blood components (either 
directly through its own blood collecting establishment or under an 
agreement) or released such blood or blood components to another entity 
or individual, the hospital must take the following actions:

[[Page 48574]]

    (i) Make reasonable attempts to notify the patient, or to notify 
the attending physician or the physician who ordered the blood or blood 
component and ask the physician to notify the patient, or other 
individual as permitted under paragraph (b)(10) of this section, that 
potentially HIV or HCV infectious blood or blood components were 
transfused to the patient and that there may be a need for HIV or HCV 
testing and counseling.
    (ii) If the physician is unavailable or declines to make the 
notification, make reasonable attempts to give this notification to the 
patient, legal guardian, or relative.
    (iii) Document in the patient's medical record the notification or 
attempts to give the required notification.
    (7) Timeframe for notification--(i) For donors tested on or after 
February 20, 2008. For notifications resulting from donors tested on or 
after February 20, 2008 as set forth at 21 CFR 610.46 and 21 CFR 610.47 
the notification effort begins when the blood collecting establishment 
notifies the hospital that it received potentially HIV or HCV 
infectious blood and blood components. The hospital must make 
reasonable attempts to give notification over a period of 12 weeks 
unless--
    (A) The patient is located and notified; or
    (B) The hospital is unable to locate the patient and documents in 
the patient's medical record the extenuating circumstances beyond the 
hospital's control that caused the notification timeframe to exceed 12 
weeks.
    (ii) For donors tested before February 20, 2008. For notifications 
resulting from donors tested before February 20, 2008 as set forth at 
21 CFR 610.48(b) and (c), the notification effort begins when the blood 
collecting establishment notifies the hospital that it received 
potentially HCV infectious blood and blood components. The hospital 
must make reasonable attempts to give notification and must complete 
the actions within 1 year of the date on which the hospital received 
notification from the outside blood collecting establishment.
    (8) Content of notification. The notification must include the 
following information:
    (i) A basic explanation of the need for HIV or HCV testing and 
counseling;
    (ii) Enough oral or written information so that an informed 
decision can be made about whether to obtain HIV or HCV testing and 
counseling; and
    (iii) A list of programs or places where the person can obtain HIV 
or HCV testing and counseling, including any requirements or 
restrictions the program may impose.
    (9) Policies and procedures. The hospital must establish policies 
and procedures for notification and documentation that conform to 
Federal, State, and local laws, including requirements for the 
confidentiality of medical records and other patient information.
    (10) Notification to legal representative or relative. If the 
patient has been adjudged incompetent by a State court, the physician 
or hospital must notify a legal representative designated in accordance 
with State law. If the patient is competent, but State law permits a 
legal representative or relative to receive the information on the 
patient's behalf, the physician or hospital must notify the patient or 
his or her legal representative or relative. For possible HIV 
infectious transfusion recipients that are deceased, the physician or 
hospital must inform the deceased patient's legal representative or 
relative. If the patient is a minor, the parents or legal guardian must 
be notified.
    (11) Applicability. HCV notification requirements resulting from 
donors tested before February 20, 2008 as set forth at 21 CFR 610.48 
will expire on August 24, 2015.
    (c) General blood safety issues. For lookback activities only 
related to new blood safety issues that are identified after August 24, 
2007, hospitals must comply with FDA regulations as they pertain to 
blood safety issues in the following areas:
    (1) Appropriate testing and quarantining of infectious blood and 
blood components.
    (2) Notification and counseling of recipients that may have 
received infectious blood and blood components.

(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 22, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
    Approved: December 18, 2006.
Michael O. Leavitt,
Secretary.

    Editorial Note: This document was received at the Office of the 
Federal Register on August 17, 2007.
[FR Doc. E7-16647 Filed 8-23-07; 8:45 am]
BILLING CODE 4120-01-P