[Federal Register Volume 76, Number 34 (Friday, February 18, 2011)]
[Rules and Regulations]
[Pages 9503-9512]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-3806]


-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 483, 488, 489 and 498

[CMS-3230-IFC]
RIN 0938-AQ09


Medicare and Medicaid Programs; Requirements for Long-Term Care 
(LTC) Facilities; Notice of Facility Closure

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

ACTION: Interim final rule with comment period.

-----------------------------------------------------------------------

SUMMARY: This interim final rule amends the requirements that a long-
term care (LTC) facility must meet in order to qualify to participate 
as a skilled nursing facility (SNF) in the Medicare program, or a 
nursing facility (NF) in the Medicaid program. These requirements 
implement section 6113 of the Affordable Care Act to ensure that, among 
other things, in the case of a LTC facility closure, individuals 
serving as administrators of a SNF or NF provide written notification 
of the impending closure and a plan for the relocation of residents at 
least 60 days prior to the impending closure or, if the Secretary 
terminates the facility's participation in Medicare or Medicaid, not 
later than the date the Secretary determines appropriate.

DATES: Effective Date: March 23, 2011.
    Comments: To be assured consideration, comments must be received at 
one of the addresses provided below, no later than 5 p.m. on April 19, 
2011.

[[Page 9504]]


ADDRESSES: In commenting, please refer to file code CMS-3230-IFC. 
Because of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to http://www.regulations.gov. Follow the instructions under 
the ``More Search Options'' tab.
    2. By regular mail. You may mail written comments to the following 
address only: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-3230-IFC, P.O. Box 8010, 
Baltimore, MD 21244-8010.
    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 to 
the following address only: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-3230-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 before the close of the comment period 
to either of the following addresses:
    a. For delivery in Washington, DC--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Room 445-G, Hubert 
H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 
20201.
    (Because access to the interior of the Hubert H. Humphrey 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.).
    b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.
    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.
    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 following the 
instructions 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: Kadie Thomas, (410) 786-0468. Mary 
Collins, (410) 786-3189.

SUPPLEMENTARY INFORMATION: 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.regulations.gov. Follow the search instructions 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.

I. Legislative and Regulatory Background

    According to the Centers for Medicare and Medicaid Services (CMS) 
data, as of April 2010, there are 15,713 long-term care (LTC) 
facilities (commonly referred to as nursing homes) in the U.S. LTC 
facilities are also referred to as skilled nursing facilities (SNFs) in 
the Medicare program and as nursing facilities (NFs) in the Medicaid 
program. For the past decade, CMS Online Survey Certification and 
Reporting (OSCAR) data have shown a decline in the number of nursing 
homes, from 17,508 in 1999 to 15,713 in 2010. In 2009, there were 231 
nursing home closures. In 2010, there were 191 closures.
    LTC facility closures have implications related to access to care, 
the quality of care, availability of services, and the overall health 
of residents. Therefore, having an organized process facilities must 
follow in the event of a nursing home closure would protect residents' 
health and safety, and make the transition as smooth as possible for 
residents, as well as family members and facility staff.

A. Current Regulatory Requirements for Notification of Closure to 
Residents of LTC Facilities

    Currently, requirements for the protection of residents' rights in 
the case of facility closure are found at 42 CFR 483.12(a), Transfer 
and Discharge.
    Section Sec.  483.12(a)(2), Transfer and discharge requirements, 
prohibits facilities from transferring or discharging a resident from 
the facility, except under certain circumstances, including cessation 
of operations.
    Section Sec.  483.12(a)(4), Notice before transfer, requires that 
before a facility transfers or discharges a resident, the facility must 
notify the resident and, if known, a family member or legal 
representative of the resident, of the transfer or discharge and the 
reasons for the move in writing and in a language and manner they 
understand.
    Section Sec.  483.12(a)(5), Timing of the notice, requires 
facilities to inform residents 30 days before the resident is 
transferred or discharged, except in the case of certain specific 
circumstances that include, for example, an immediate transfer or 
discharge due to a resident's urgent medical needs. In such cases, the 
notification must be made ``as soon as is practicable.'' State laws 
regarding notification of LTC facility closures vary, with the majority 
of States requiring 30 days notice prior to closure. However, there are 
some States that require up to 90 days notice, such as Vermont, 
Illinois and Pennsylvania (see (http://www.sph.umn.edu/hpm/nhregsPlus/category_attachments/category_admission_discharge_transfer_rights.pdf#pagemode=bookmarks&page=1 for information on these States 
and general background on State regulations pertaining to nursing 
facility admission, transfer, and discharge rights).
    Section Sec.  483.12(a)(6), Contents of the notice, specifies what 
must be included in such notifications, for example the location to 
which the resident is being transferred or discharged. Finally, Sec.  
483.12(a)(7), Orientation for transfer or discharge, requires a 
facility to provide sufficient preparation and orientation to residents 
to ensure safe and orderly transfer or discharge from the facility.
    Section Sec.  488.426 Transfer of residents, or closure of the 
facility and transfer of residents, gives authority to the State in 
emergency situations. Section 488.426 (a), which is not being revised 
in this rule, requires that, in an emergency, the State has the 
authority to--(1) Transfer Medicaid and Medicare residents to another 
facility; or (2) Close

[[Page 9505]]

the facility and transfer the Medicaid and Medicare residents to 
another facility.
    If a facility closes permanently due to an emergency, the 
administrator is required to provide proper notification. However, if 
the State temporarily relocates residents during an emergency with the 
expectation that the residents will return to the facility, we would 
not regard this situation to be a facility closure and would not 
require the administrator to provide notification. For example, CMS 
recently received notification that a facility's air conditioning 
failed during a heat wave. The State ordered the facility to relocate 
all of its residents while the problem was being investigated but did 
not close the facility. Since the States customarily provide 
notification under Sec.  488.426 for emergency-related closures, CMS is 
not proposing the administrator be required to provide such 
notification.

B. Requirements for Notification of Closure to Other Individuals or 
Entities

    Currently, there are no Federal regulations requiring that a LTC 
facility notify the Secretary or a State's LTC ombudsman prior to 
closure of a LTC facility and there are no Federal requirements for 
submission of a plan for closure of a LTC facility to any individual or 
entity.

C. Legislative Requirements and the Affordable Care Act Amendments

    Sections 1819(b)(1)(A) of the Social Security Act (the Act) for 
SNFs and 1919(b)(1)(A) of the Act for NFs both state that a SNF/NF must 
care for its residents in such a manner and in such an environment as 
will promote maintenance or enhancement of the quality of life of each 
resident.
    Sections 1819(c)(2)(A) and 1919(c)(2)(A) of the Act state that in 
general, with certain specified exceptions, a SNF/NF must permit each 
resident to remain in the facility and must not transfer or discharge 
the resident from the facility.
    Section 6102 of the Affordable Care Act of 2010 (Pub. L. 111-148, 
March 23, 2010) added a new section 1128I to the Act to promote greater 
accountability for LTC facilities (defined as skilled nursing 
facilities and nursing facilities pursuant to new subsection 1128I(a) 
of the Act). Section 6113 of the Affordable Care Act added an 
additional subsection 1128I(h) to the Act, setting forth certain 
requirements for LTC facility closures, effective March 23, 2011, as 
follows:
1. Notification of Facility Closure
    Section 1128I(h)(1)(A)(i) of the Act, as added by the Affordable 
Care Act, states that in general, any individual who is the 
administrator of the facility must submit to the Secretary, the State 
LTC ombudsman, residents of the facility, and the legal representatives 
of such residents or other responsible parties, written notification of 
an impending facility closure.
    For informational purposes, LTC ombudsmen are advocates for 
residents of nursing homes, board and care homes and assisted living 
facilities. Ombudsmen provide information about how to find a facility 
and what to do to get quality care. They are trained to resolve 
problems, and will assist individuals with complaints; however, unless 
an ombudsman is given permission, these matters are kept confidential. 
Under the Federal Older Americans Act, every State is required to have 
an Ombudsman Program that addresses complaints and advocates for 
improvements in the LTC system (http:[sol][sol]www.ltcombudsman.org/).
    For voluntary or State-mandated closures, the required written 
notification must not be later than 60 days prior to the date of such 
closure. Section 1128I(h)(1)(A)(ii) of the Act states that if the 
Secretary terminates the facility's participation under this title, 
notification must be provided no later than the date that the Secretary 
determines appropriate. Section 1128I(h)(1)(B) of the Act states that 
the administrator must also ensure that the facility does not admit any 
new residents on or after the date on which such written notification 
is submitted.
    Finally, section 1128I(h)(1)(C) of the Act states that LTC 
facilities must include in their closure notices a plan, approved by 
the State, for the transfer and adequate relocation of residents of the 
facility by a specified date prior to closure. The notices must also 
include assurances that the residents will be transferred to the most 
appropriate facility or other setting in terms of quality, services, 
and location, taking into consideration the needs, choice, and best 
interests of each resident.
2. Relocation
    Section 1128I(h)(2)(A) of the Act requires a State to ensure, 
before a facility in the State closes, that all residents of the 
facility have been successfully relocated to another facility or an 
alternative home and community-based setting. Because this requirement 
applies to States and not the LTC facility, we have not included it in 
this rule for LTC facilities. We will implement this statutory 
requirement through sub-regulatory guidance to be published in the 
State Operations Manual (SOM) as interpretive guidance for surveyors. 
We are requesting comments on the best means of implementing this 
provision.
    Section 1128I(h)(2)(B) of the Act authorizes the Secretary to 
continue to make payments under this title with respect to residents of 
a facility that has submitted the required notifications under section 
1128I(h)(1) during the period beginning on the date such notification 
is submitted and ending on the date on which the resident is 
successfully relocated.
3. Sanctions
    Section 1128I(h)(3) of the Act, as added by the Affordable Care 
Act, states that any individual who is the administrator of the 
facility that fails to comply with the requirements set out in the 
subsection shall be subject to a civil monetary penalty of up to 
$100,000, may be subject to exclusion from participation in any Federal 
health care program (as defined in section 1128B(f) of the Act), and 
shall be subject to any other penalties that may be prescribed by law.
    Additionally, Section 1128I(h)(4) of the Act ``Procedure,'' states 
that the provisions of section 1128A of the Act (other than subsections 
(a) and (b) and the second sentence of subsection (f)) shall apply to a 
civil money penalty or exclusion under paragraph (3) in the same manner 
as such provisions apply to a penalty or proceeding under section 
1128A(a) of the Act.
    Subsection 6113(c) of the Affordable Care Act requires that the 
provisions of new subsection 1128I(h) of the Act become effective one 
year after the date of enactment--that is, March 23, 2011. Therefore, 
because of the statutory deadline, we are implementing this rule as an 
interim final rule with comment period.

II. Health Disparities

    CMS is committed to developing regulation in a manner that focuses 
on improving the quality of health care for all persons. Therefore, we 
believe that it is important in the preamble of regulations to discuss 
our goal of addressing health care disparities and to solicit comments 
on how our regulations could be used to address such disparities.
    In 1985, the Secretary of the Department of Health and Human 
Services issued a landmark report that revealed large and persistent 
gaps in health status among Americans of different racial and ethnic 
groups and served as an impetus for addressing health inequalities for 
racial and ethnic minorities in the U.S. This report led to the 
establishment of the Office of

[[Page 9506]]

Minority Health (OMH) within the Department of Health and Human 
Services (HHS), with a mission to address these disparities. National 
concern for these differences, termed health disparities, and the 
associated excess mortality and morbidity have been expressed as a high 
priority in national health status reviews, including Healthy People 
2000 and 2010.
    Since that time, research has extensively documented the 
pervasiveness of racial and ethnic disparities in health care and has 
led to the acknowledgement of racial and ethnic disparities as a 
national problem. As a result, more populations have been identified as 
vulnerable, which has necessitated the development of programs and 
strategies to reduce disparities for vulnerable populations, as well as 
the emergence of new leadership to address such disparities. Currently, 
vulnerable populations can be defined by race/ethnicity, socio-economic 
status, geography, gender, age, disability status, sexual orientation, 
and other populations identified to be at-risk for health disparities. 
Other populations at risk may include persons with visual or hearing 
problems, cognitive perceptual problems, language barriers, pregnant 
women, infants, and persons with disabilities or special health care 
needs.
    Although there has been much attention at the national level to 
ideas for reducing health disparities in vulnerable populations, we 
remain vigilant in our efforts to improve health care quality for all 
persons by improving health care access and by eliminating real and 
perceived barriers to care that may contribute to less than optimal 
health outcomes for vulnerable populations. For example, we are aware 
that immunization rates remain low among some minorities. Despite the 
long-term implementation of some strategies, such as the use of 
language translators in hospitals, health literacy and its impact on 
health care outcomes continues to be in the forefront.
    We are always seeking better ways to address the needs of 
vulnerable populations; therefore, we are specifically requesting 
comments in regard to how our LTC facility closure requirements could 
be used to address disparities among facility residents.

III. Provisions of the Interim Final Rule With Comment Period

    Based on the provisions of section 1128I(h) of the Act, as added by 
the Affordable Care Act, we are revising the current requirements for 
LTC facilities, as discussed below. Under this new provision the 
administrator of the facility will be subject to sanctions for failure 
to provide proper notice according to these new provisions. However, in 
some cases, an administrator has no control over closure procedures. 
For instance, an administrator may be hired to oversee a facility's 
impending closure, although he or she was not present when the decision 
was made to close, or the administrator was employed fewer than 60 days 
prior to closure. In regards to LTC facilities, this is the first 
regulation where civil monetary penalties would be imposed on an 
individual. CMS considered the impact that this rule would have on an 
administrator that would be in a facility for an insufficient amount of 
time to comply with this regulation. We believe that the Congress 
intended CMS to use sanctions as a method to assure that the 
requirements in the statue be implemented. The language that the 
Congress used was ``up to $100,000.'' They used this language to have a 
maximum amount, but intended for CMS to determine the amount of the 
sanctions. Due to the many possible combinations of violations that 
could be cited gradations would be limited to the number of offenses. 
Any sanctions that have been levied against an administrator would also 
be reviewed by the State's licensing agency for possible disciplinary 
action including suspension and termination of the administrator's 
license. Because of the unique Federal laws applicable to the operation 
of IHS and Tribal LTC facilities under the authority of 25 U.S.C. 
1621(d), the implementation of this IFC by such facilities will be 
developed in consultation with the IHS and Tribal programs.

A. Transfer and Discharge Sec.  483.12(a)

    We are revising Sec.  483.12(a) by redesignating current paragraph 
(a)(8) as paragraph (a)(9) and adding a new Sec.  483.12(a)(8) to 
require that, in the case of a facility closure, any individual who is 
the administrator of the facility must provide written notification 
prior to the impending closure to the Secretary, the State LTC 
ombudsman, the residents of the facility, and the legal representatives 
of such resident or other responsible parties, as well as provide a 
plan for the transfer and adequate relocation of the residents, in 
accordance with new Sec.  483.75(r).
    We are also revising Sec.  483.12(a)(5)(i) ``Timing of the 
notice'', which allows for exceptions to the 30-day notification 
requirement for closures. We are adding a statement that newly added 
paragraph (a)(8), which generally states who must file a notice and 
plan and to whom the notice and plan must be filed in the event of 
impending closure, is also an exception to the timing requirements 
found in paragraph (a)(5)(i).

B. Facility Closure-Administrator Sec.  483.75(r)

    We are adding a new subsection (r) to Sec.  483.75. At Sec.  
483.75(r)(1), we are requiring that any individual who is the 
administrator of the facility must submit to the Secretary, the State 
LTC ombudsman, residents of the facility, and the legal representative 
of such residents (or other responsible parties) written notification 
of an impending closure at least 60 days prior to the date of closure; 
or, in the case of a facility where the Secretary terminates the 
facility's participation in the Medicare and/or Medicaid programs, not 
later than the date that the Secretary determines appropriate for such 
notification.
    To understand how the Secretary may determine a date for a 
notification when the Secretary has terminated the facility's 
participation in Medicare, Medicaid, or both, we are providing 
background on facility requirements to participate in these programs. 
The Secretary may terminate a facility's participation if the facility 
fails in any area outlined in Sec.  489.53(a)(1) through (a)(15). For 
instance, at Sec.  489.53(a)(3), failure to continue to meet the 
appropriate conditions of participation or requirements for SNFs and 
NFs set forth elsewhere in this chapter would be grounds for 
termination by CMS. In addition, the timing of the notification of 
termination by the Secretary may vary based on the justification for 
the closure. Section 489.53(d)(1) provides the basic timing rule for 
notice of termination by CMS, which is 15 days before the effective 
date of termination of the provider agreement. Section 489.53(d)(2)(ii) 
provides the timing rule for closures that are the result of 
deficiencies that may pose immediate jeopardy, which is 2 days prior to 
the effective date of the termination of the provider agreement.
    In addition, at Sec.  483.75(r)(2) we are requiring any individual 
who is the administrator of the LTC facility to ensure that the 
facility does not admit any new residents on or after the date on which 
such written notification is submitted to the Secretary, the State LTC 
ombudsman, and the residents, and/or their representatives or other 
responsible parties.
    At Sec.  483.75(r)(3), we are requiring that any individual who is 
the administrator of a LTC facility include in the written notice of 
closure, a plan that has been approved by the State for the transfer

[[Page 9507]]

and adequate relocation of the residents of the facility by a date that 
would be specified prior to closure, including assurances that the 
residents would be transferred to the most appropriate facility or 
other setting in terms of quality, services, and location, taking into 
consideration the needs, choice, and best interests of each resident.
    We would expect that the closure plan would include sufficient 
detail to clearly identify the steps the facility would take, and the 
individual responsible for ensuring the steps are successfully carried 
out. As an example, the plan might include: (among other things):
     Assessment of residents' care needs and the provision of 
appropriate services.
     A plan for communicating with staff and/or unions.
     Continuation of appropriate staffing levels and paychecks 
at the facility.
     Provision of necessary supplies.
     Identification of available facilities to which residents 
could be transferred, along with an assessment of the quality of care 
provided by these facilities (for example, Minimum Data Set (MDS) OSCAR 
data).
     A process for relocation of residents.
     Operation and management of the facility and oversight of 
those managing the facility.
     The roles and responsibilities of the facility's 
Administrator or replacement.
     Sources of supplemental funding to assist in keeping a 
facility open until the residents are transferred.
     A plan for communicating with the Secretary, the State LTC 
ombudsman, residents and legal representatives of the residents or 
other responsible parties.

C. Facility Closure Sec.  483.75(s)

    We are adding Sec.  483.75(s) to require that the facility have in 
place policies and procedures that will ensure the administrator's 
duties and responsibilities involve providing the appropriate notices. 
While this provision is not explicitly required by section 1128I(h), we 
believe that it is implicitly authorized by the terms of section 6113 
of the Affordable Care Act. Moreover, it is explicitly permitted by the 
general rulemaking authority of sections 1819(d)(4)(B) and 
1919(d)(4)(B) of the Act, which permit the Secretary to issue rules 
relating to the health, safety and well-being of residents, and rules 
concerning physical facilities. The facility will not be sanctioned for 
noncompliance with this rule; however, it will be cited for a 
deficiency during the survey process.

D. Transfer of Residents, or Closure of the Facility and Transfer of 
Residents Sec.  488.426

    At Sec.  488.426, we are revising paragraph (b) to include a cross-
reference to the new requirements at Sec.  483.75(r). We are also 
adding paragraph (c) Required notifications when a facility's provider 
agreement is terminated to address the required notifications when a 
facility closes.

E. Administrator Sanctions: Long-Term Care Facility Closures Sec.  
488.446

    As required by Section 6113 of the Affordable Care Act, new Sec.  
488.446 will subject any administrator of a facility that fails to 
comply with the requirements at Sec.  483.75(r) to sanctions. Such 
individual--
    (1) Would be subject to a civil monetary penalty as follows: A 
minimum of $500 for the first offense; a minimum of $1,500 for the 
second offense; and a minimum of $3,000 for the third and subsequent 
offenses. The three levels of civil monetary penalties (CMPs) represent 
a minimum amount for each offense; however, an administrator could be 
subject to higher amounts of CMPs (not to exceed $100,000) based on 
criteria that CMS will identify in interpretative guidelines. If it is 
determined that an administrator of record completely fails to take the 
necessary and timely actions to adhere to the Notice of Facility 
Closure thus causing unjustified harm to the resident, family, and 
visitors, then the administrator could be subject to additional CMPs. 
For example, the administrator abandons his or her responsibility as 
set forth in the Notice of Facility Closure for the purpose of personal 
gain (financial) by devoting his or her energies to keeping the 
facility open rather than working on a safe and timely closure.
    (2) Could be subject to exclusion from participation in any Federal 
health care program (as defined in section 1128B(f) of the Act); and
    (3) Would be subject to any other penalties that may be prescribed 
by law.

F. Period of Continued Payments Sec.  488.450(c)

    At Sec.  488.450(c), we are renumbering this section to add 
paragraphs (1) and (2). Current Sec.  488.450(c) corresponds with new 
Sec.  488.450(c)(1), and new paragraph (2) provides that the Secretary 
may, as deemed appropriate, continue to make payments under this title 
with respect to residents of an LTC facility that has submitted a 
notification of closure during the period beginning on the date such 
notification is submitted and ending on the date on which the resident 
is successfully relocated.

G. Notice to CMS Sec.  489.52(a)

    We are revising Sec.  489.52(a)(1) to provide an exception for 
SNFs, redesignating paragraph (a)(2) as paragraph (a)(3), and outlining 
the requirement specific to SNF notifications to CMS in new paragraph 
(a)(2).
    At Sec.  489.52(a)(2), we are requiring that a SNF provider that 
wishes to terminate its agreement must send CMS written notice of its 
intent at least 60 days prior to the date of closure, in accordance 
with Sec.  483.75(r)(1)(i).

H. Skilled Nursing Facility Closure Sec.  489.53(d)(3)

    At Sec.  489.53(d)(3), we are revising and redesignating the 
section to state that when CMS terminates a facility's participation 
under Medicare or Medicaid, CMS will determine the date of the required 
notifications. We are also revising Sec.  489.53(d)(1) to reflect this 
change.

I. Exceptions to Effective Date of Termination Sec.  489.55

    When a notification is made as required at Sec.  483.75(r), the new 
requirements authorize the Secretary to continue to make payments to 
the SNF or, for a NF, to the State, as the Secretary considers 
appropriate, during the period beginning at the time the notification 
is submitted and until the resident is successfully relocated. We 
renumbered this section to redesignate paragraphs (a) and (b) as 
paragraphs (1) and (2), and added a new paragraph (b) to implement this 
requirement.

J. Scope and Applicability Sec.  498.3

    We are adding Sec.  498.3(a)(2)(iv) to clarify that CMS may also 
impose sanctions on NF administrators for noncompliance with Sec.  
483.75(r). In addition, we are adding a new subparagraph Sec.  
498.3(a)(3)(ii) to indicate that the appeals process applies to NFs as 
well as SNFs.
    We are adding to Sec.  498.3(b) Initial determinations by CMS, a 
new paragraph (18) to indicate that a sanction imposed on a SNF or NF 
administrator for noncompliance with the requirements set out at Sec.  
483.75(r) constitutes an initial determination of the agency.

K. Appeal Rights Sec.  498.5

    At Sec.  498.5, we are adding paragraph (m) Appeal rights of an 
individual who is the administrator of a SNF or NF to establish appeal 
rights for administrator

[[Page 9508]]

sanctions for noncompliance with the requirements set out at Sec.  
483.75(r).

IV. 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.

V. Waiver of Proposed Rulemaking

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register and invite public comment on the interim final rule in 
accordance with 5 U.S.C. 553(b) of the Administrative Procedure Act 
(APA). The notice of proposed rulemaking includes a reference to the 
legal authority under which the rule is proposed, and the terms and 
substances of the interim final 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.
    Section 6113 of the Affordable Care Act, effective March 23, 2011, 
added new section 1128I(h) of the Act, which requires that the 
administrator of a facility follow specified procedures prior to 
closure of a facility. The Act requires any individual who is the 
administrator to provide written notification to the Secretary, the 
State LTC ombudsman, residents of the facility, and the legal 
representatives of such residents or other responsible parties, of an 
impending facility closure. As mentioned above, LTC facility closures 
have implications for access, the quality of care provided, 
availability of services, and the overall health of residents, 
necessitating that an organized process be followed in the event of a 
nursing home closure. The Congress mandated at subsection 6113(c) of 
the Affordable Care Act that these amendments take effect one year 
after the date of the enactment of this Act.
    We believe that, in mandating a 1 year effective date, the Congress 
was acknowledging the importance of protecting the vulnerable elderly 
residents of LTC facilities. Advance notice of facility closure allows 
a resident and his or her legal representative or interested family 
member to prepare for the move to another facility, which can prove 
very traumatic to the resident. A move uproots a resident from a 
familiar environment, including a roommate and other residents, as well 
as assigned care providers, sometimes including the resident's 
physician. LTC facility closures require critical adjustments and 
create difficult issues for residents and their families and 
representatives. The Affordable Care Act under section 1128I(h) 
mandates specific procedures in the event of a closure of a nursing 
home. These procedures help protect the resident, the resident's 
family, and visitors because it requires the facility to provide an 
organized plan that allows the resident, family, and visitors to make 
the necessary adjustments within a reasonable time frame. At present, 
no Federal rule exists for facility closure. Delaying the 
implementation of the rule would continue to cause unjustified harm to 
the resident, family, and visitors.
    We believe that to publish this rule as a proposed rule would 
jeopardize the safety of these individuals and the fulfillment of the 
mandated implementation date of March 23, 2011. Thus, we find that the 
Congressional directive renders adherence to the normal notice of 
proposed rulemaking requirements under the APA both impracticable and 
contrary to the public interest. Therefore, we find good cause to waive 
the notice of proposed rulemaking and to issue this final rule on an 
interim basis. We are providing a 60-day public comment period. In 
accordance with section 1871(a)(3) of the Act, all Medicare interim 
final rules must be finalized within three years.

VI. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 60-day notice in the Federal Register and solicit public 
comment before 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):
    The revisions at Sec.  483.12(a)(8) require any individual who is 
the administrator of the facility to submit to the Secretary, the State 
LTC ombudsman, residents and their legal representatives or other 
responsible parties, written notification of an impending closure at 
least 60 days prior to such closure; or not later than the date that 
the Secretary deems appropriate in the case of a facility where the 
Secretary terminates the facility's participation under this title.
    Current regulations at Sec.  483.12(a)(5) require notification of 
transfer or discharge to a resident and, if known, a family member or 
legal representative, in writing. Except in certain specified 
circumstances, notification must be made at least 30 days prior to 
transfer or discharge. Facility closure is not a circumstance that 
permits a facility to make notification in fewer than 30 days. Although 
the requirement extends the time period for notification from 30 days 
to 60 days (or a date determined by the Secretary in case of CMS 
termination of the facility), we do not believe the change in the time 
period for reporting imposes any additional burden. In addition, 
notification of transfer or discharge to residents and their 
representatives is already a usual and customary business practice. 
Therefore, in accordance with 5 CFR 1320.3(b)(2), we will not include 
this activity in the ICR burden analysis.
    Although there are no existing Federal regulatory requirements for 
LTC facilities to notify other individuals or entities of an impending 
closure, according to feedback to CMS from State surveyors for LTC 
facilities, nearly all States already require LTC facilities to notify 
the State within 30 to 90 days. Because we have found that 
notifications of impending closure are a standard business practice for 
most LTC facilities, we believe that this requirement would impose 
burden on only a small number of facilities.
    Each facility that does not already notify the State and the State 
LTC ombudsman must develop a process for doing so. We estimate that the 
burden associated with complying with this requirement would be due to 
the resources required to develop a process for notifying the State and 
the State LTC ombudsman and the time it takes to notify those entities. 
We expect that such a notification process would involve the 
administrator of the facility

[[Page 9509]]

and administrative support person and an attorney to review the plan.
    We anticipate that, on average, it will take 7 hours for a total 
burden of $5,584,400.16.
    The revisions at Sec.  483.75(r)(2) require that the administrator 
of the facility ensure that the facility does not admit any new 
residents on or after the date written notification is submitted. We do 
not anticipate any ICR burden associated with this requirement.
    Section 483.75(r)(3) requires the administrator of the facility to 
include in the notice the plan for the transfer and adequate relocation 
of the residents of the facility by a date that is specified by the 
State prior to closure, including assurances that the residents would 
be transferred to the most appropriate facility or other setting in 
terms of quality, services, and location, taking into consideration the 
needs, choice, and best interests of each resident.
    Section 483.75(s) requires the facility to have in place policies 
and procedures to ensure that the administrator's duties and 
responsibilities include the provision of the appropriate notices in 
the event of a facility closure.
    In our experience, based on feedback to CMS from State surveyors of 
LTC facilities, most facilities already have plans for transfer of 
residents, regardless of whether closure of the facility is expected. 
For example, most facilities have plans for transfer of residents to 
another facility in the event of an emergency. Also based on our 
experience, nearly all facilities anticipating closure develop plans 
for the relocation of residents and other closure-related activities. 
Many States require such plans. For example, Vermont requires that the 
State licensing agency and the LTC ombudsman be notified by the 
administrator of the facility 90 days prior to the proposed date of 
closure. In addition, the facility administrator is required to provide 
to the State licensing agency and LTC ombudsman a written transfer plan 
60 days prior to closure.
    Because we have found that transfer plans are a standard business 
practice for most LTC facilities, we believe that this requirement 
would impose burden on only a small number of facilities.
    Each facility that does not already have a plan in place must 
develop a plan for the transfer and adequate relocation of residents of 
the facility. We estimate that the burden associated with complying 
with this requirement would be due to the resources required to develop 
and review a new plan or, if necessary, modify an existing plan for the 
transfer of residents in the event of facility closure. We expect that 
development of such a plan would involve the administrator of the 
facility, an administrative support person, and an attorney to review 
the plan.
    LTC facilities are currently required to have a plan under Sec.  
483.12 for discharge and transfer of residents. A facility must provide 
sufficient preparation and orientation to residents to ensure safe and 
orderly transfer or discharge from the facility. Therefore, we 
anticipate that, on average, it will take 3 hours to develop the plan, 
1 hour to ensure that the administrator's duties include policies and 
procedures relating to facility closures, 2 hours for an administrative 
support person to prepare the document(s), and 1 hour for an attorney 
to review the document(s), for a total estimated burden of 7 hours per 
facility. We also believe that the burden would remain approximately 
the same for the first year and beyond.
    Currently, there are 15,713 LTC facilities in the U.S. Based on an 
hourly rate of $58.17 for a nursing home administrator, we estimate 
that development of the plan and incorporating facility closure 
policies and procedures into the administrator's duties would cost 
$3,656,100.80 (15,713 facilities x 4 hours per facility) x $58.17 per 
hour). Based on an hourly rate of $20.11 for an administrative 
assistant, we estimate that preparing the plan documents would cost 
$631,976.86 ((15,713 facilities x 2 hours per facility) x $20.11 per 
hour). Finally, based on an hourly rate of $82.50 for an attorney, we 
estimate that reviewing the plan document would cost $1,296,322.50 
((15,713 facilities x 1 hour per facility) x $82.50 per hour). The 
salary estimates include 33 percent of the mean hourly rate for 
overhead and fringe benefits (Source: BLS.gov).
    If you comment on these information collection and recordkeeping 
requirements, please submit your comments electronically as specified 
in the ADDRESSES section of this interim final rule.

VII. Regulatory Impact Analysis

A. Statement of Need

    Executive Order 13563 directs agencies to consider and discuss 
qualitatively values that are difficult to quantify, including equity, 
human dignity, fairness and distributive impacts. This IFC will 
implement the Affordable Care Act under section 1128I(h) that mandates 
specific procedures in the event of a closure of a nursing home. LTC 
facility closure procedures have implications related to access to 
care, the quality of care, and the overall health of residents. These 
procedures help protect the resident, the resident's family, and 
visitors because it requires the facility to provide an organized plan 
that allows the resident, family, and visitors to make the necessary 
adjustments within a reasonable time frame.

B. Overall Impact

1. Executive Order 12866
    We have examined the impacts of this rule as required by Executive 
Order 12866 on Regulatory Planning and Review (September 30, 1993), 
Executive Order 13563 on Improving Regulation and Regulatory Review 
(February 2, 2011), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, the 
Unfunded Mandates Reform Act of 1995 (March 22, 1995; Pub. L. 104-4), 
Executive Order 13132 on Federalism (August 4, 1999) and the 
Congressional Review Act (5 U.S.C. 804(2)).
    Executive Order 12866 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 in any 1 year). This rule 
does not qualify as a major rule as the estimated economic impact. We 
estimate that these requirements will cost $355 (5,584,400/15,713) per 
facility the first year and each year thereafter.
2. Regulatory Flexibility Act (RFA)
    The RFA requires agencies to analyze options for regulatory relief 
of small businesses, if a rule has a significant impact on a 
substantial number of small entities. For purposes of the RFA, small 
entities include small businesses, nonprofit organizations, and small 
government jurisdictions. The great majority of hospitals and most 
other health care providers and suppliers are small entities, either by 
being nonprofit organizations or by meeting the SBA definition of a 
small business (having revenues of less than $7.0 million to $34.5 
million in any 1 year). For purposes of the RFA, most physician 
practices, hospitals and other providers are small entities, either by 
nonprofit status or by qualifying as small businesses under the Small 
Business Administration's size standards (revenues of less than $7.0 to 
$34.5

[[Page 9510]]

million in any 1 year). States and individuals are not included in the 
definition of a small entity. For details, see the Small Business 
Administration's Web site at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&sid=2465b064ba6965cc1fbd2eae60854b11&rgn=div8&view=text&node=13:1.0.1.1.16.1.266.9&idno=13. A rule has a significant economic impact 
on the small entities it affects, if it significantly affects their 
total costs or revenues. Under statute we are required to assess the 
compliance burden the regulation will impose on small entities. 
Generally, we analyze the burden in terms of the impact it will have on 
entities' costs if these are identifiable or revenues. As a matter of 
sound analytic methodology, to the extent that data are available, we 
attempt to stratify entities by major operating characteristics such as 
size and geographic location. If the average annual impact on small 
entities is 3 to 5 percent or more, it is to be considered significant.
    We estimate that these requirements will cost $355 ($5,584,400/
15,713 facilities) per facility initially and $355 ($5,584,400/15,713 
facilities) thereafter. This clearly is much below 1 percent; 
therefore, we do not anticipate it to have a significant impact. We do 
not have any data related to the number of LTC facilities that have 
facility closure plans in place; however, we are aware through our 
experience with LTC facilities and the survey process that most 
facilities have a plan for closure either because they are required to 
have such a plan in place at the State level or because of their 
understanding that this is a standard business practice.
3. Social Security Act
    In addition, section 1102(b) of the Social Security 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 the 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 and has fewer than 100 beds. This 
rule would impact only SNFs and NFs. Therefore, the Secretary has 
determined that this interim final rule would not have any impact on 
the operations of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 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. In 2010, that 
threshold is approximately $135 million. This rule would not have a 
significant impact on the governments mentioned or on private sector 
costs. The estimated economic effect of this rule is $5,584,400 the 
first year and $5,584,400 thereafter. These estimates are derived from 
our analysis of burden associated with these requirements in section 
IV, ``Collection of Information Requirements.''
    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. This rule would not have any effect on State or local 
governments.

C. Anticipated Effects

1. Effects on LTC Facilities
    The purpose of this rule is to ensure that, among other things, in 
the case of a facility closure, any individual who is the administrator 
of the facility provide written notification of the closure and the 
plan for the relocation of residents at least 60 days prior to the 
impending closure or, if the Secretary terminates the facility's 
participation in Medicare or Medicaid, not later than the date the 
Secretary determines appropriate. This would protect residents' health 
and safety and make the transition to closure as smooth as possible for 
residents, as well as family members and facility staff.
2. Effects on Other Providers
    This rule is expected to allow for a smoother transition when a 
facility closes. It requires facilities and facility administrators to 
prepare in advance for closure so, in the event of a closure, the 
facility is equipped to protect resident rights and continue to provide 
quality care to residents who must be relocated. This interim final 
rule would also improve coordination of care between the LTC facility 
where the residents are transferred from and the LTC facility they are 
transferred to. We anticipate that only LTC facilities would be 
affected.
3. Effects on the Medicare and Medicaid Programs
    This rule would require that CMS and the State be notified in the 
case of a facility closure and provides them with the ability to make 
determinations regarding the timing of termination of provider 
agreements and continuation of payments to LTC facilities. This rule 
would also support efforts directed toward broad-based improvements in 
the quality of health care furnished by Medicare and Medicaid 
providers.

D. Alternatives Considered

    We considered the effects of not addressing specific requirements 
for the notification of facility closures in LTC facilities, although 
these requirements are statutory and only allow limited discretion on 
the part of the Secretary. However, we do believe that to improve 
quality and ensure consistency in the provision of care in LTC 
facilities, it is important to ensure that residents rights are 
protected in LTC facilities and that they are relocated appropriately, 
taking into consideration the needs, choice and best interest of each 
resident should a facility closure take place. We expect that these 
requirements would result in improvement in the quality of services 
provided to LTC residents when they need to be involuntarily relocated.

E. Conclusion

    This interim final rule ensures that, among other things, in the 
case of a facility closure, any individual who is the administrator of 
the facility provide written notification of the closure and the plan 
for the relocation of residents at least 60 days prior to the impending 
closure or, if the Secretary terminates the facility's participation in 
Medicare or Medicaid, not later than the date the Secretary determines 
appropriate.
    It is consistent with the requirements set forth in section 6113 of 
the Affordable Care Act and the Administration's efforts toward broad-
based improvements in the quality of health care furnished by Medicare 
and Medicaid providers.
    This interim final rule clarifies the responsibility of the 
administrator of a facility, which is to ensure that the specified 
parties are notified of an impending closure in a specified timeframe 
and identifies penalties for non-compliance. It also clarifies the 
responsibility of the administrator of the facility to ensure that no 
new residents are admitted after written notice is submitted and that 
the notice of closure must include a plan for transfer and adequate 
relocation to another facility. These facilities must take into 
consideration the needs, choices and best interests of each resident.
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

[[Page 9511]]

List of Subjects

42 CFR Part 483

    Grant programs--Health, Health facilities, Health professions, 
Health records, Medicaid, Medicare, Nursing homes, Nutrition, Reporting 
and recordkeeping requirements, Safety.

42 CFR Part 488

    Administrative practice and procedure, Health facilities, Medicare, 
Reporting and recordkeeping requirements.

42 CFR Part 489

    Health facilities, Medicare, Reporting and recordkeeping 
requirements.

42 CFR Part 498

    Administrative practice and procedure, Health facilities, Health 
professions, Medicare, Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services amends 42 CFR Chapter IV as set forth below:

PART 483--REQUIREMENTS FOR STATES AND LONG TERM CARE FACILITIES

0
1. The authority citation for part 483 is revised to read as follows:

    Authority:  Secs. 1102, 1128I and 1871 of the Social Security 
Act (42 U.S.C. 1302 and 1395hh).

Subpart B--Requirements for Long Term Care Facilities

0
2. Section 483.12 is amended by--
0
A. Revising paragraph (a)(5)(i);
0
B. Redesignating paragraph (a)(8) as paragraph (a)(9).
0
C. Adding a new paragraph (a)(8).
    The revisions and additions read as follows:


Sec.  483.12  Admission, transfer and discharge rights.

    (a) * * *
    (5) Timing of the notice. (i) Except as specified in paragraphs 
(a)(5)(ii) and (a)(8) of this section, the notice of transfer or 
discharge required under paragraph (a)(4) of this section must be made 
by the facility at least 30 days before the resident is transferred or 
discharged.
* * * * *
    (8) Notice in advance of facility closure. In the case of facility 
closure, the individual who is the administrator of the facility must 
provide written notification prior to the impending closure to the 
Secretary, the State LTC ombudsman, residents of the facility, and the 
legal representatives of the residents or other responsible parties, as 
well as the plan for the transfer and adequate relocation of the 
residents, as required at Sec.  483.75(r).
* * * * *

0
3. Section 483.75 is amended by adding a new paragraph (r) and 
paragraph (s) to read as follows:


Sec.  483.75  Administration.

* * * * *
    (r) Facility closure-Administrator. Any individual who is the 
administrator of the facility must:
    (1) Submit to the Secretary, the State LTC ombudsman, residents of 
the facility, and the legal representatives of such residents or other 
responsible parties, written notification of an impending closure:
    (i) At least 60 days prior to the date of closure; or
    (ii) In the case of a facility where the Secretary or a State 
terminates the facility's participation in the Medicare and/or Medicaid 
programs, not later than the date that the Secretary determines 
appropriate;
    (2) Ensure that the facility does not admit any new residents on or 
after the date on which such written notification is submitted; and
    (3) Include in the notice the plan for the transfer and adequate 
relocation of the residents of the facility by a date that would be 
specified by the State prior to closure, including assurances that the 
residents would be transferred to the most appropriate facility or 
other setting in terms of quality, services, and location, taking into 
consideration the needs, choice, and best interests of each resident.
    (s) Facility closure. The facility must have in place policies and 
procedures to ensure that the administrator's duties and 
responsibilities involve providing the appropriate notices in the event 
of a facility closure, as required at paragraph (r) of this section.

PART 488--SURVEY, CERTIFICATION, AND ENFORCEMENT PROCEDURES

0
4. The authority citation for part 488 is revised to read as follows:

    Authority:  Secs. 1102, 1128I and 1871 of the Social Security 
Act, unless otherwise noted (42 U.S.C. 1302 and 1395hh); Pub. L. 
110-149, 121 Stat. 1820.

Subpart F--Enforcement of Compliance for Long-Term Care Facilities 
With Deficiencies

0
5. Section 488.426 is amended by--
0
A. Revising paragraph (b).
0
B. Adding a new paragraph (c).
    The revisions and additions read as follows:


Sec.  488.426  Transfer of residents, or closure of the facility and 
transfer of residents.

* * * * *
    (b) Required transfer when a facility's provider agreement is 
terminated. When the State or CMS terminates a facility's provider 
agreement, the State will arrange for the safe and orderly transfer of 
all Medicare and Medicaid residents to another facility, in accordance 
with Sec.  483.75(r) of this chapter.
    (c) Required notifications when a facility's provider agreement is 
terminated. When the State or CMS terminates a facility's provider 
agreement, CMS determines the appropriate date for notification, in 
accordance with Sec.  483.75(r)(1)(ii) of this chapter.


0
6. Add a new Sec.  488.446 to read as follows:


Sec.  488.446  Administrator sanctions: long-term care facility 
closures.

    Any individual who is or was the administrator of a facility and 
fails or failed to comply with the requirements at Sec.  483.75(r) of 
this chapter--
    (a) Will be subject to a civil monetary penalty as follows:
    (1) A minimum of $500 for the first offense.
    (2) A minimum of $1,500 for the second offense.
    (3) A minimum of $3,000 for the third and subsequent offenses.
    (b) May be subject to exclusion from participation in any Federal 
health care program (as defined in section 1128B(f) of the Act); and
    (c) Will be subject to any other penalties that may be prescribed 
by law.


0
7. Section 488.450 is amended by revising paragraph (c) to read as 
follows:


Sec.  488.450  Continuation of payments to a facility with 
deficiencies.

* * * * *
    (c) Period of continued payments-- (1) Non-compliance. If the 
conditions in paragraph (a)(1) of this section are met, CMS may 
continue payments to a Medicare facility or the State for a Medicaid 
facility with noncompliance that does not constitute immediate jeopardy 
for up to 6 months from the last day of the survey.
    (2) Facility closure. In the case of a facility closure, the 
Secretary may, as the Secretary determines appropriate, continue to 
make payments with respect to residents of a long-term care facility 
that has submitted a notification of closure during the period 
beginning on the date such notification is submitted to CMS and ending 
on the date on which the resident is successfully relocated.
* * * * *

[[Page 9512]]

PART 489--PROVIDER AGREEMENTS AND SUPPLIER APPROVAL

0
8. The authority for part 489 is revised to read as follows:

    Authority:  Secs. 1102, 1128I and 1819, 1820(e), 1861, 1864(m), 
1866, 1869, and 1871 of the Social Security Act (42 U.S.C. 1302, 
1351i-3, 1395x, 1395aa(m), 1395cc, 1395ff, and 1395hh).

Subpart E--Termination of Agreement and Reinstatement After 
Termination

0
9. Section 489.52 is amended by revising paragraph (a) to read as 
follows:


Sec.  489.52  Termination by the provider.

    (a) Notice to CMS. (1) A provider that wishes to terminate its 
agreement, except for a SNF as specified in paragraph (a)(2) of this 
section, must send CMS written notice of its intention in accordance 
with paragraph (a)(3) of this section.
    (2) A SNF that wishes to terminate its agreement due to closure of 
the facility must send CMS written notice of its intention at least 60 
days prior to the date of closure, as required at Sec.  483.75(r) of 
this chapter.
    (3) The notice may state the intended date of termination which 
must be the first day of the month.
* * * * *

0
10. Section Sec.  489.53 is amended by--
0
A. Revising paragraph (d)(1).
0
B. Redesignating paragraph (d)(3) and paragraph (d)(4) as paragraph 
(d)(4) and paragraph (d)(5).
0
C. Adding a new paragraph (d)(3).
    The revisions and additions read as follows:


Sec.  489.53  Termination by CMS.

* * * * *
    (d) Notice of termination--(1) Timing: basic rule. Except as 
provided in paragraphs (d)(2) and (d)(3) of this section, CMS gives the 
provider notice of termination at least 15 days before the effective 
date of termination of the provider agreement.
* * * * *
    (3) Notice of LTC facility closure. In the case of a facility where 
CMS terminates a facility's participation under Medicare or Medicaid in 
the absence of immediate jeopardy, CMS determines the appropriate date 
for notification.
* * * * *

0
11. Section Sec.  489.55 is revised to read as follows:


Sec.  489.55  Exceptions to effective date of termination.

    (a) Payment is available for up to 30 days after the effective date 
of termination for:
    (1) Inpatient hospital services (including inpatient psychiatric 
hospital services) and posthospital extended care services (except as 
specified in paragraph (b) of this section with respect to LTC 
facilities) furnished to a beneficiary who was admitted before the 
effective date of termination; and
    (2) Home health services and hospice care furnished under a plan 
established before the effective date of termination.
    (b) The Secretary may, as the Secretary determines is appropriate, 
continue to make payments with respect to residents of a long-term care 
facility that has submitted a notification of closure as required at 
Sec.  483.75(r) of this chapter during the period beginning on the date 
such notification is submitted and ending on the date on which the 
residents are successfully relocated.

PART 498--APPEAL PROCEDURES FOR DETERMINATIONS THAT AFFECT 
PARTICIPATION IN THE MEDICARE PROGRAM AND FOR DETERMINATIONS THAT 
AFFECT THE PARTICIPATION OF ICFs/MR AND CERTAIN NFs IN THE MEDICAID 
PROGRAM

0
12. The authority citation for part 498 is revised to read as follows:

    Authority:  Secs. 1102, 1128I and 1871 of the Social Security 
Act (42 U.S.C. 1302 and 1395hh).

Subpart A--General Provisions

0
13. Section 498.3 is amended by--
0
A. Adding a new paragraph (a)(2)(iv).
0
B. Revising paragraph (a)(3) introductory text and (a)(3)(ii).
0
C. Adding a new paragraph (b)(18).
    The revisions and additions read as follows:


Sec.  498.3  Scope and applicability.

    (a) * * *
    (2) * * *
    (iv) CMS's determination to impose sanctions on the individual who 
is the administrator of a NF for failure to comply with the 
requirements at Sec.  483.75(r) of this chapter.
    (3) The following parts of this chapter specify the applicability 
of the provisions of this part 498 to sanctions or remedies imposed on 
the indicated entities or individuals:
* * * * *
    (ii) Part 488, subpart E (Sec.  488.330(e)) and subpart F (Sec.  
488.446)--for SNFs and NFs and their administrators.
* * * * *
    (b) * * *
    (18) The level of noncompliance found by CMS with respect to the 
failure of an individual who is the administrator of a SNF to comply 
with the requirements at Sec.  483.75(r) of this chapter, and the 
appropriate sanction to be imposed under Sec.  488.446 of this chapter.
* * * * *

0
14. Section 498.5 is amended by adding a new paragraph (m) to read as 
follows:


Sec.  498.5  Appeal rights.

* * * * *
    (m) Appeal rights of an individual who is the administrator of a 
SNF. An individual who is the administrator of a SNF who is 
dissatisfied with the decision of CMS to impose sanctions authorized 
under Sec.  488.446 of this chapter is entitled to a hearing before an 
ALJ, to request Board review of the hearing decision, and to seek 
judicial review of the Board's decision.

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

    Dated: November 18, 2010.
Donald M. Berwick,

Administrator, Centers for Medicare & Medicaid Services.
    Approved: February 15, 2011.
Kathleen Sebelius,
Secretary.
[FR Doc. 2011-3806 Filed 2-17-11; 8:45 am]
BILLING CODE 4120-01-P