[Federal Register Volume 73, Number 59 (Wednesday, March 26, 2008)]
[Rules and Regulations]
[Pages 15937-15939]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-6164]



Office of the Secretary

Office of Inspector General

42 CFR Part 1008

Medicare and State Health Care Programs: Fraud and Abuse; 
Issuance of Advisory Opinions by OIG

AGENCY: Office of Inspector General (OIG), HHS.

ACTION: Interim final rule with comment period.


SUMMARY: In accordance with section 205 of the Health Insurance 
Portability and Accountability Act of 1996, this final rule amends the 
OIG regulations at 42 CFR part 1008 by (1) revising the process for 
advisory opinion requestors to submit payments for advisory opinion 
costs, and (2) clarifying that notices to the public announcing 
procedures for processing advisory opinion requests will be published 
on OIG's Web site.

DATES: Effective Date: These regulations are effective on April 25, 
    Comment Period: To assure consideration, public comments must be 
delivered to the address provided below by no later than 5 p.m. on 
April 25, 2008.

ADDRESSES: In commenting, please refer to file code OIG-223-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, 
    1. Electronically. You may submit electronic comments on specific 
recommendations and proposals through the Federal eRulemaking Portal at 
http://www.regulations.gov. (Attachments should be in Microsoft Word, 
if possible.)
    2. By regular, express, or overnight mail. You may send written 
comments to the following address: Office of Inspector General, 
Department of Health and Human Services, Attention: OIG-223-IFC, Room 
5246, Cohen Building, 330 Independence Avenue, SW., Washington, DC 
20201. Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By hand or courier. If you prefer, you may deliver, by hand or 
courier, your written comments before the close period to Office of 
Inspector General, Department of Health and Human Services, Cohen 
Building, 330 Independence Avenue, SW., Washington, DC 20201. Because 
access to the interior of the Cohen Building is not readily available 
to persons without Federal Government identification, commenters are 
encouraged to schedule their delivery with one of our staff members at 
(202) 358-3141.
    For information on viewing public comments, please see section IV 
in the Supplementary information section below.

FOR FURTHER INFORMATION CONTACT: Meredith Melmed, Office of Counsel to 
the Inspector General, (202) 619-0335.


I. Background

A. Section 205 of Public Law 104-191

    The Health Insurance Portability and Accountability Act of 1996 
(HIPAA), Public Law 104-101, specifically required the Department to 
provide a formal guidance process to requesting individuals and 
entities regarding the application of the anti-kickback statute, the 
safe harbor provisions, and other OIG health care fraud and abuse 
sanctions. In accordance with section 205 of HIPAA, the Department, in 
consultation with the Department of Justice, issues written advisory 
opinions to parties with regard to: (1) What constitutes prohibited 
remuneration under the anti-kickback statute; (2) whether an 
arrangement or proposed arrangement satisfies the criteria in section 
1128B(b)(3) of the Social Security Act (the Act), or established by 
regulation, for activities which do not result in prohibited 
remuneration; (3) what constitutes an inducement to reduce or limit 
services to Medicare or Medicaid program beneficiaries under section 
1128A(b) of the Act \1\; and (4) whether an activity or proposed 
activity constitutes grounds for the imposition of civil or criminal 
sanctions under sections 1128, 1128A, or 1128B of the Act.

    \1\ Public Law 104-191 erroneously cited this provision as 
section 1128B(b) of the Act. Section 4331(a) of the Balanced Budget 
Act of 1997, Public Law 105-33, corrected this citation to section 
1128A(b) of the Act.

B. OIG Final Regulations

    OIG published an interim final rule (62 FR 7350; February 19, 1997) 
establishing a new part 1008 in 42 CFR chapter V addressing various 
procedural issues and aspects of the advisory opinion process. In 
response to public comments received on the interim final regulations, 
we published a final rule (63 FR 38311; July 16, 1998) revising and 
clarifying various aspects of the earlier rulemaking. The rulemaking 
established procedures for requesting an advisory opinion. 
Specifically, the rule provided information to the public regarding 
costs associated with preparing an opinion and procedures for 
submitting an initial deposit and final payment to OIG for such costs.

 II. Provisions of the Interim Final Rule

    By statute, the Department must charge a fee equal to the costs 
incurred by the Department in responding to a request for an advisory 
opinion. (42 U.S.C. 1320a-7d(b)(5)(B)(ii)). Under the interim final and 
final advisory opinion rules, we directed requestors to make an initial 
payment to the U.S. Treasury by check or money order in the amount of 
$250. The regulations have also allowed for the acceptance of final 
payment of the fee by check or money order.
    Through this interim final rule, we are setting forth several 
revisions to the payment process for advisory opinion requests. 
Specifically, we are modifying our procedures for submitting an 
advisory opinion request by deleting the current requirements at 
Sec. Sec.  1008.31(b) and 1008.36(b)(6) for an initial payment of $250 
for each advisory opinion request, and replacing the existing provision 
set forth in Sec.  1008.31(b) with a requirement that payment for an 
advisory opinion be made directly to the Treasury of the United States, 
as directed by OIG. In addition, we are amending Sec.  1008.43(d) to 
state that an advisory opinion will be issued following receipt by OIG 
of confirmation that payment in full has been remitted by the 
requesting party to the Department of Treasury as directed by OIG.

[[Page 15938]]

A. Electronic Payment Directly to the U.S. Treasury

    As of the effective date of this rule, we will no longer accept 
checks or money orders from requesting parties and will require 
payments to be made directly to the United States Treasury through wire 
or other electronic funds transfer. Changing the requirement that 
payment be made by check or money order to provide for wire or other 
electronic funds transfers will create efficiencies in processing 
payments for advisory opinion requests, reduce the use of staff 
resources to process such payments, and reduce the burden on requesting 

B. Elimination of Initial Deposit

    We are also eliminating the initial deposit payment from the 
requirements for submitting an advisory opinion request. A deposit is 
not required by statute. We believe that deleting the initial deposit 
payment will further streamline the electronic payment process and will 
eliminate administrative burdens that may arise if an initial deposit 
must be returned. For instance, where parties erroneously submit 
requests that are wholly outside our authority to issue an advisory 
opinion, such as requests regarding issues arising under the physician 
self-referral law (42 U.S.C. 1395nn), returning funds submitted 
directly to the Department of Treasury would be cumbersome. In 
addition, eliminating the initial deposit requirement will reduce the 
burden on requesting parties by consolidating the parties' payment 
obligations into one final payment. We will provide additional 
instructions to the public on our Web site (http://www.oig.hhs.gov) for 
paying fees owed for advisory opinions via wire or other electronic 
funds transfer.

III. Regulatory Impact Statement

A. Administrative Procedure Act

    OIG has determined that the public notice and comment requirements 
of the Administrative Procedure Act, 5 U.S.C. 553(b), do not apply to 
this rule because the rule is procedural in nature and does not alter 
the substantive rights of the affected parties. Therefore, this rule 
satisfies the exemption from notice and comment rulemaking in 5 U.S.C. 
553(b)(A). OIG nevertheless invites comments on this rule and will 
consider all timely submitted comments.
    The advisory opinion process is an established OIG program. This 
rule is limited to modifying the processing of payments received for 
advisory opinion requests. It does not modify eligibility of a party to 
request an advisory opinion, nor does it modify the standards under 
which OIG will accept and/or analyze a request. OIG expects that this 
rule will further the public's interest in minimal burden by deleting 
the requirement for an initial payment of a deposit to be credited 
toward the final advisory opinion processing costs and by allowing the 
use of electronic transfers of funds. The rule will also provide 
greater efficiency in processing payments from requestors and will save 
staff time.

B. Regulatory Analysis

    We have examined the impact of this rule as required by Executive 
Order 12866, the Unfunded Mandates Reform Act of 1995, the Regulatory 
Flexibility Act (RFA) of 1980, and Executive Order 13132.
Executive Order 12866
    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, if regulations are 
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 must be prepared for major rules with economically significant 
effects (i.e., $100 million or more in any given year).
    This is not a major rule, as defined at 5 U.S.C. 804(2), and it is 
not economically significant since the overall economic effect of the 
rule is less than $100 million annually. As indicated in Section II of 
this preamble, this rule deals exclusively with the procedural issues 
involved in the payment for advisory opinions issued by OIG. This rule 
does not address the substance of the anti-kickback statute or other 
sanction statutes. This rule does not change any costs associated with 
requesting an advisory opinion, but, rather, clarifies the procedures 
for submitting statutorily-mandated payment for costs incurred 
preparing an advisory opinion. We believe that the aggregate economic 
impact of this rule will be minimal and will have no effect on the 
economy or on Federal or State expenditures. To the extent that there 
is any economic impact, that impact will likely result in savings of 
Federal dollars through the improved efficiencies in the use of staff 
resources for processing advisory opinion requests and payments related 
to advisory opinion requests, as well as savings for parties that 
request advisory opinions.
Unfunded Mandates Reform Act
    Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law 
104-4, requires that agencies assess anticipated costs and benefits 
before issuing any rule that may result in expenditures in any one year 
by State, local or tribal governments, in the aggregate, or by the 
private sector, of $110 million. Since the rule merely revises the 
process for paying for advisory opinions and creates greater 
efficiencies in processing payments, we believe that this rule that 
will not impose any mandates on State, local, or tribal governments or 
the private sector that would result in an expenditure of $110 million 
or more (adjusted for inflation) in any given year, and that a full 
analysis under the Unfunded Mandates Reform Act is not necessary.
Regulatory Flexibility Act
    The RFA and the Small Business Regulatory Enforcement and Fairness 
Act of 1996, which amended the RFA, require agencies to analyze options 
for regulatory relief of small entities. For purposes of the RFA, small 
entities include small businesses, certain nonprofit organizations, and 
small governmental jurisdictions. Individuals and States are not 
included in the definition of a small entity. The RFA, as amended, 
requires an agency to prepare and make available to the public a 
regulatory flexibility analysis that describes the effect of a proposed 
rule on small entities when the agency is required to publish a general 
notice of proposed rulemaking for any proposed rule. Because this rule 
is being issued as an interim final rule, on the grounds set forth 
above, a regulatory flexibility analysis is not required under the RFA.
Executive Order 13132
    Executive Order 13132, Federalism, establishes certain requirements 
that an agency must meet when it promulgates a rule that imposes 
substantial direct requirements or costs on State and local 
governments, preempts State law, or otherwise has Federalism 
implications. In reviewing this rule under the threshold criteria of 
Executive Order 13132, we have determined that this rule would not 
significantly limit the rights, roles, and responsibilities of State or 
local governments. We have determined, therefore, that a full analysis 
under Executive Order 13132 is not necessary.
    The Office of Management and Budget (OMB) has reviewed this rule in 
accordance with Executive Order 12866.

C. Paperwork Reduction Act

    In accordance with section 3506(c)(2)(A) of the Paperwork Reduction 
Act of 1995, we are required to solicit public comments, and receive

[[Page 15939]]

final OMB approval, on any information collection requirements set 
forth in rulemaking.
    This rule will not impose any information collection burden or 
affect information currently collected by OIG.

IV. Inspection of Public Comments

    All comments received before the end of the comment period are 
available for viewing by the public. All comments will be posted on 
http://www.regulations.gov as soon as possible after they have been 
received. Comments received timely will also be available for public 
inspection as they are received at Office of Inspector General, 
Department of Health and Human Services, Cohen Building, 330 
Independence Avenue, SW., Washington, DC 20201, Monday through Friday 
of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to 
view public comments, phone (202) 619-0089.

List of Subjects in 42 CFR Part 1008

    Administrative practice and procedure, Fraud, Grant programs--
health, Health facilities, Health professions, Medicaid, Medicare, 

Accordingly, 42 CFR chapter V, subchapter B is mended as set forth 


1. The authority citation for part 1008 continues to read as follows:

    Authority: 42 U.S.C. 1320a-7d(b)

2. Section 1008.31 is amended by revising paragraph (b) to read as 

Sec.  1008.31  OIG fees for the cost of advisory opinions.

* * * * *
    (b) Payment Method. Payment for a request for an advisory opinion 
must be made to the Treasury of the United States, as directed by OIG.
* * * * *

3. Section 1008.36 is amended by removing paragraph (b)(6) and 
redesignating paragraphs (b)(7) and (b)(8) as (b)(6) and (b)(7) 
* * * * *

4. Section 1008.43 is amended by revising paragraph (d) to read as 

Sec.  1008.43  Issuance of a formal advisory opinion.

* * * * *
    (d) After OIG has notified the requestor of the full amount owed 
and OIG has determined that the full payment of that amount has been 
properly paid by the requestor, OIG will issue the advisory opinion and 
promptly mail it to the requestor by regular first class U.S. mail.

    Dated: January 30, 2008.
Daniel R. Levinson,
Inspector General.
    Approved: February 28, 2008.
Michael O. Leavitt, Secretary.
[FR Doc. E8-6164 Filed 3-25-08; 8:45 am]