[Federal Register Volume 78, Number 209 (Tuesday, October 29, 2013)]
[Rules and Regulations]
[Pages 64604-64636]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-24056]



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Vol. 78

Tuesday,

No. 209

October 29, 2013

Part II





Department of Health and Human Services





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Center for Medicare & Medicaid Services





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42 CFR Part 485





Medicare Program: Conditions of Participation (CoPs) for Community 
Mental Health Centers; Final Rule

  Federal Register / Vol. 78 , No. 209 / Tuesday, October 29, 2013 / 
Rules and Regulations  

[[Page 64604]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Part 485

[CMS-3202-F]
RIN 0938-AP51


Medicare Program: Conditions of Participation (CoPs) for 
Community Mental Health Centers

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

ACTION: Final rule.

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SUMMARY: This final rule establishes, for the first time, conditions of 
participation (CoPs) that community mental health centers (CMHCs) must 
meet in order to participate in the Medicare program. These CoPs focus 
on the care provided to the client, establish requirements for staff 
and provider operations, and encourage clients to participate in their 
care plan and treatment. The new CoPs enable CMS to survey CMHCs for 
compliance with health and safety requirements.

DATES: These regulations are effective on October 29, 2014.

FOR FURTHER INFORMATION CONTACT: Mary Rossi-Coajou, (410) 786-6051.
Maria Hammel, (410) 786-1775.

SUPPLEMENTARY INFORMATION:

I. Background

A. Introduction

    In 2012, 100 certified Community Mental Health Centers (CMHCs) 
billed Medicare for partial hospitalization services. Currently, there 
are no Conditions of Participation (CoPs) in place for Medicare-
certified CMHCs. As such, an insufficient regulatory basis exists to 
ensure quality and safety for CMHC care. Sections 1102 and 1871 of the 
Social Security Act (the Act) give CMS the general authority to 
establish CoPs for Medicare providers. Therefore, we are establishing 
for the first time a set of requirements that Medicare-certified CMHCs 
must meet in order to participate in the Medicare program. These CoPs 
will help to ensure the quality and safety of CMHC care for all clients 
served by the CMHC, regardless of payment source.
    These requirements focus on a short term, person-centered, outcome-
oriented process that promotes quality client care. Requirements for 
CMHC services encompass--(1) personnel qualifications; (2) client 
rights; (3) admission, initial evaluation, comprehensive assessment, 
and discharge or transfer of the client; (4) treatment team, active 
treatment plan, and coordination of services; (5) quality assessment 
and performance improvement; and (6) organization, governance, 
administration of services, and partial hospitalization services. 
Bridging these CMHC requirements are quality assessment and performance 
improvement program requirements that build on a provider's own quality 
management system to improve client care performance. We expect CMHCs 
to furnish health care that meets the essential health and quality 
standards that are established by this rule; therefore, a CMHC will be 
expected to use its own quality management system to monitor and 
improve its own performance and compliance.

B. Current Requirements for CMHCs

    Section 1832(a)(2)(J) of the Act established coverage of partial 
hospitalization services for Medicare beneficiaries in CMHCs. Section 
1861(ff)(2) of the Act defines partial hospitalization services as a 
broad range of mental health services ``that are reasonable and 
necessary for the diagnosis or active treatment of the individual's 
condition, reasonably expected to improve or maintain the individual's 
condition and functional level and to prevent relapse or 
hospitalization, and furnished pursuant to such guidelines relating to 
frequency and duration of services as the Secretary shall by regulation 
establish. . . .''
    Section 4162 of the Omnibus Budget Reconciliation Act of 1990 (OBRA 
1990) (Pub. L. 101-508) amended sections 1832(a)(2) and 1861(ff)(3) of 
the Act to allow CMHCs to provide partial hospitalization services. 
Under the Medicare program, apart from limited telehealth services, 
CMHCs are recognized as Medicare providers only for partial 
hospitalization services (see 42 CFR 410.110).
    A CMHC, in accordance with section 1861(ff)(3)(B) of the Act, is an 
entity that meets applicable licensing or certification requirements 
for CMHCs in the State in which it is located, and provides the set of 
services specified in section 1913(c)(1) of the Public Health Service 
Act (PHS Act). However, CMS has learned that most States either do not 
have a certification or licensure program for these types of 
facilities, or have regulatory requirements that apply only to CMHCs 
that receive Medicaid or other direct state funding.
    A CMHC may receive Medicare payment for partial hospitalization 
services only if it meets the core requirements at Sec.  410.2 and 
provides partial hospitalization program (PHP) services that are in 
accordance with regulations at Sec.  424.24(e).
    When the partial hospitalization program benefit in CMHCs was first 
enacted, CMHCs were certified based on self-attestation. Currently, 
CMHCs are Medicare-certified and Medicare-enrolled based on a CMS 
Regional Office determination that the provider meets the definition of 
a CMHC at section 1861(ff)(3)(B) of the Act and provides the core 
services described in section 1913(c)(1) of the PHS Act. CMS has 
received complaints regarding some CMHCs, such as their ceasing to 
provide services once the CMHC has been certified, physically 
mistreating clients, and providing fragmented care. As there are no 
CoPs in place for CMHCs, many participating CMHCs have never had an 
onsite survey visit by CMS after their initial certification. 
Furthermore, there are currently only limited circumstances in which 
CMS can terminate a CMHC from Medicare participation based on the 
result of a complaint investigation. Without such health and safety 
standards in place, CMS's oversight of CMHCs is severely limited.

C. Rationale for Establishing CMHC CoPs

    Medicare is responsible for establishing requirements to promote 
the health and safety of care provided to its beneficiaries. We believe 
that basic health and safety standards should be established for CMHCs 
in order to protect clients and their families. Establishing CMHC CoPs 
will enable CMS to survey providers, through State survey and 
certification agencies, to ensure that the care being furnished meets 
the standards.
    On August 20, 2012, the U.S. Department of Health and Human 
Services Office of the Inspector General (OIG) published a report 
entitled Questionable Billing by Community Mental Health Centers, OEI-
04-11-00100 http://oig.hhs.gov/oei/reports/oei-04-11-00100.asp. In this 
report it was found that in 2010 approximately half of the CMHCs met or 
exceeded thresholds that indicated unusually high billing for at least 
one out of nine questionable billing characteristics. Approximately 
one-third of these CMHCs had at least two of the characteristics. 
Additionally, approximately two-thirds of the CMHCs with questionable 
billing were located in eight metropolitan areas. Finally, 90 percent 
of the CMHCs with questionable billing were located in States that do 
not require CMHCs to be licensed or certified. The OIG had four 
specific recommendations including the finalization of the proposed 
conditions

[[Page 64605]]

of participation for CMHCs. Due to the possibility of significant gaps 
in State requirements to ensure the health and safety of CMHC clients, 
we chose to propose and are finalizing a core set of health and safety 
requirements that will apply to all CMHCs receiving Medicare funds, 
regardless of the State in which the CMHC is located. These 
requirements will ensure a basic level of services provided by 
qualified staff, and will be consistent with the recommendations of the 
OIG. As with CoPs applied to other provider types, these requirements 
will apply for all clients served by the CMHC, not just Medicare 
beneficiaries.

D. Principles Applied in Developing the CMHC CoPs

    We developed the CMHC requirements based on the following 
principles:
     A focus on the continuous, integrated, mental health care 
process that a client experiences across all CMHC services.
     Activities that center around client assessment, the 
active treatment plan, and service delivery.
     Use of a person-centered, interdisciplinary approach that 
recognizes the contributions of various skilled professionals and other 
support personnel and their interaction with each other to meet the 
client's needs.
     Promotion and protection of client rights.
    Based on these principles, we proposed and are finalizing the 
following six CoPs: (1) Personnel qualifications; (2) client rights; 
(3) admission, initial evaluation, comprehensive assessment, and 
discharge or transfer of the client; (4) treatment team, active 
treatment plan, and coordination of services; (5) quality assessment 
and performance improvement; and (6) organization, governance, 
administration of services, and partial hospitalization services.
    The ``Personnel qualifications'' CoP establishes staff 
qualifications for the CMHC.
    The ``Client rights'' CoP emphasizes a CMHC's responsibility to 
respect and promote the rights of each CMHC client.
    The ``Admission, initial evaluation, comprehensive assessment, and 
discharge or transfer of the client'' CoP reflects the critical nature 
of a comprehensive assessment in determining appropriate treatments and 
accomplishing desired health outcomes.
    The ``Treatment team, active treatment plan, and coordination of 
services'' CoP incorporates a person-centered interdisciplinary team 
approach, in consultation with the client's primary health care 
provider (if any).
    The ``Quality assessment and performance improvement'' CoP 
challenges each CMHC to build and monitor its own quality management 
system to monitor and improve client care performance.
    The ``Organization, governance, administration of services, and 
partial hospitalization services'' CoP charges each CMHC with the 
responsibility for creating and implementing a governance structure 
that focuses on and enhances its coordination of services to better 
serve its clients.
    Two of the CoPs, ``Admission, initial evaluation, comprehensive 
assessment, and discharge or transfer of the client'' and ``Treatment 
team, active treatment plan, and coordination of services,'' establish 
a cycle of individualized client care. The client's care needs will be 
comprehensively assessed, enabling the interdisciplinary team, with the 
client, to establish an active treatment plan. The active treatment 
plan will be implemented, and the results of the care will be evaluated 
by updating the comprehensive assessment and active treatment plan.
    These CoPs present an opportunity for CMHCs, States, and CMS to 
join in a partnership for improvement. CMHC programming will reflect a 
person-centered approach that will affect how State survey and 
certification agencies and CMS manage the survey process. This approach 
provides opportunities for improvement in client care.

II. Provisions of the Proposed Rule and Analysis and Response to Public 
Comments

    We published a proposed rule in the Federal Register (76 FR 35684) 
on June 17, 2011. In that rule, we proposed to establish a new subpart 
J under the regulations at part 485 to incorporate the proposed CoPs 
for CMHCs.
    We specified that the new subpart J would include the basis and 
scope of the subpart, definitions, and the six CoPs and requirements.
    We provided a 60-day public comment period in which we received a 
total of 203 timely comments from accrediting bodies, consumer advocacy 
organizations, CMHCs, individuals, national health care provider 
organizations, State agencies, and State health care provider 
organizations. Overall, the majority of commenters were supportive of 
the proposed changes. Summaries of the major issues and our responses 
are set forth below.

A. Basis and Scope (Sec.  485.900)

    At Sec.  485.900, we proposed to cite the statutory authority for 
CMHCs to provide services that are payable under Medicare Part B. In 
addition, we proposed to describe the scope of provisions in proposed 
subpart J.

B. Definitions (Sec.  485.902)

    At Sec.  485.902, we proposed to define the following terms to be 
used in the CoPs for CMHCs under the proposed subpart J: ``active 
treatment plan,'' ``community mental health center (CMHC),'' 
``comprehensive assessment,'' ``employee of a CMHC,'' ``initial 
evaluation,'' ``representative,'' ``restraint,'' ``seclusion,'' and 
``volunteer''.
    Comment: Some commenters expressed concern related to the 
requirement that all volunteers meet the standard training requirements 
under Sec.  485.918(d). The commenters believe it is unreasonable to 
require CMHCs to provide the specific training and competency 
assessments required under Sec.  485.918(d)(1) and (d)(3) for 
volunteers. Other commenters believe an initial orientation tailored to 
the actual work a volunteer will be doing ensures that volunteers will 
receive the information and guidelines they need from CMHCs without 
imposing an unnecessary and impractical barrier to using volunteers.
    Response: We appreciate the feedback related to the definition of a 
volunteer and associated training requirements. We agree with the 
commenters that orientation should be tailored to the actual work the 
volunteer will be doing. However, the volunteer would need additional 
training in areas such as CMHC care and services, as well as specific 
in-service training and education, depending on the role of the 
volunteer. For example, if a volunteer role is to work in the CMHC 
client waiting area, we would expect the CMHC to educate the volunteer 
in areas such as the CMHC privacy policy, de-escalation techniques, and 
other pertinent training that may affect the role of that volunteer. 
Therefore, we are finalizing the definition of volunteer and their 
training requirements as proposed.
    Comment: One commenter stated that it is difficult to imagine a 
situation where a client's representative would be terminating medical 
care on the client's behalf. The commenter stated that the definition 
should reflect the principles of client involvement and the protection 
of client rights, including emphasizing the right of a client to make 
decisions regarding treatment. The commenter stated that one 
possibility would be to

[[Page 64606]]

change the definition to state that a representative is ``an individual 
legally authorized to make decisions on behalf of a client who is 
mentally and physically incapacitated,'' and eliminate any reference to 
terminating medical care.
    Response: We appreciate the feedback and suggestions related to the 
definition of ``representative''. We agree that it would be more common 
for a client to have a representative who would be authorizing care, 
not terminating care. However, CMS uses the term ``representative'' 
across many different provider types. Therefore, we are finalizing the 
definition of ``representative'' as proposed.
CMHC CoP: Personnel Qualifications (Sec.  485.904)
    We proposed to add a new CoP at Sec.  485.904 to establish staff 
qualifications for CMHCs. The proposed CoP was divided into two 
standards.
    At Sec.  485.904(a), ``Standard: General qualification 
requirements,'' we proposed to require that all professionals who 
furnish services directly, under an individual contract, or under 
arrangements with a CMHC, be legally authorized (licensed, certified or 
registered) in accordance with applicable Federal, State and local 
laws, and be required to act only within the scope of their State 
licenses, certifications, or registrations. We also proposed that all 
personnel qualifications would have to be kept current at all times.
    At Sec.  485.904(b), ``Standard: Personnel qualifications for 
certain disciplines,'' we proposed to require staff qualifications to 
be consistent with, or similar to, those set forth in CoPs for other 
provider types in the Medicare regulations. Specifically, we proposed 
personnel requirements for the following disciplines: Administrator of 
a CMHC, Clinical Psychologist, Clinical Social Worker, Mental Health 
Counselor, Occupational Therapist, Physician, Psychiatric Registered 
Nurse, and Psychiatrist.
    Comment: Several commenters agreed with requiring that ``all 
professionals who furnish services directly must be legally authorized 
(licensed, certified or registered) in accordance with applicable 
Federal, State and local laws, and must act only within the scope of 
their State licenses.'' They also stated that most states allow 
individuals with Master's level degrees, such as social work and 
psychology, to provide services under the supervision of a licensed 
professional. Commenters stated that a period of supervision is 
required for these professionals to receive licenses. In addition, 
commenters stated that many peer educators and Bachelor's level 
professionals do not have a process for becoming licensed, or must work 
in a supervised position for a certain number of hours to obtain 
certification.
    Response: We thank the commenters for the information regarding 
professionals who furnish services in a CMHC. We believe that the 
regulations at Sec.  485.904 allow for professionals with a Master's 
degree in psychology or social work to provide services under a 
licensed professional as long as it is within their scope of practice 
and allowed by the State. If a State decides that Baccalaureate level 
professionals need to be supervised for a certain number of hours to 
meet State licensure requirements to obtain their license, we defer to 
that State's decision. Our proposed language did not impose additional 
restrictions or require that States establish additional licensing 
programs or requirements. Therefore, we are finalizing Sec.  485.904(a) 
as proposed.
    Comment: A few commenters agreed that it is important that 
personnel qualifications be defined by CMS. However, they believe that 
the facility should qualify their staff and make sure their staff is 
competent to perform their job responsibilities. Commenters stated that 
this could be achieved by using the education, experience, and services 
the individual is able to perform under the scope of his or her license 
and based on the laws of his or her state. Commenters also believe it 
is important that CMS recognize that there are many different types of 
mental health professionals who are qualified to perform the clinical 
responsibilities within the CMHC, regardless of the ``title of their 
degree.'' According to the commenters, it is imperative that CMS not 
limit the CMHC provider to one specific degree and or license (that is, 
clinical social worker vs. mental health counselor) to perform 
``certain'' roles in the CMHC, as this would be an impossible task to 
adhere to and an administrative and financial burden that is 
unnecessary to the CMHC.
    Commenters also stated that CMS is required to accept the scope of 
state licensure of various mental health care professionals in the 
context of Medicare's partial hospitalization program benefit. Congress 
explicitly stated in the Social Security Act that individual and group 
therapy services provided within a partial hospitalization program at a 
CMHC can be conducted by physicians, psychologists or ``other mental 
health professionals to the extent authorized under State law'', as 
noted in Section 1861(ff)(2)(A) of the Act.
    Response: We thank the commenters for the comments regarding 
licensure, education, and experience as they relate to the personnel 
requirements. Our goal in requiring specific personnel requirements is 
to protect the health and safety of the clients served by the CMHC. 
That said, we agree that practitioners should not be restricted by our 
rules from acting within the scope of practice authorized under State 
law and any applicable licensing requirements. We have amended the 
language in this final rule to assist in ensuring that practitioners 
can practice to the full extent of their State licensure.
    Comment: A few commenters are concerned that, in their view, CMHCs 
may have inadequate boards of directors, and that the board and 
administrator of the CMHC are permitted to be one and the same. 
Commenters stated that anyone with limited investment capital and no 
knowledge of psychiatric care can open and operate a CMHC, and that 
this is one of the system's greatest weaknesses. Commenters requested 
that, in cases where the administrator has a financial (that is, 
controlling) interest in the CMHC, minimum professional standards 
should apply.
    Response: We thank the commenters for the information regarding the 
administrator and board of directors. We agree that in some cases there 
is potential for the administrator and the governing body to be one and 
the same. However, we do not believe that modifying the language under 
personnel requirements for the administrator is the best place to 
address this issue. Therefore, we are finalizing the administrator 
personnel requirements as proposed. We have also modified the language 
at Sec.  485.918(a)(1) related to the governing body to require two or 
more persons to serve on the governing body, one of whom must possess 
knowledge and experience as a mental health clinician. The 
administrator will be able to serve as a member of the governing body, 
but we will require at least one (or more) additional person(s) to be 
part of the governing body. For example, if the administrator has no 
psychiatric health background, either one of the CMHC's clinicians or 
another qualified professional should be appointed to serve as a member 
of the governing body.
    Comment: At proposed Sec.  485.904(b)(6), a few commenters noted 
that CMS used the definition of physician found in section 1861(r) of 
the Act. The commenters requested that CMS further limit the statutory

[[Page 64607]]

definition of physician by limiting it to section 1861(r)(1), which 
lists a doctor of medicine or osteopathy. The commenter believes that 
this will help ensure that clients in a CMHC receive quality care from 
appropriately trained doctors of medicine or osteopathy legally 
authorized to practice medicine and surgery by the State.
    Response: We thank the commenters for the comment regarding the 
definition of a physician, now located at Sec.  485.904(b)(7). We 
understand the commenters' concerns with the broadness of the 
definition, and believe that requiring the physician to have experience 
in providing mental health services to clients will assure that these 
physicians are qualified to provide CMHC services. Therefore, the 
requirements will remain as proposed.
    Comment: Some commenters expressed concern with the psychiatric 
registered nurse personnel requirements. Specifically, the commenters 
expressed concern about the requirement of 2 years of education and 
training in psychiatric nursing. Some commenters believe the training 
requirement should be reduced to 1 year. Other commenters stated that 
non-profit CMHCs face competition for professional staff and cannot 
always offer salaries as high as those offered by other providers, such 
as hospitals. CMHCs in rural areas have an added hurdle to recruiting 
and retaining clinicians. One way CMHCs can attract staff at the 
salaries they are able to pay is by offering recent graduates the 
opportunity to gain more experience working in community behavioral 
health. The commenters stated that it is unclear whether the two-year 
education and/or training requirement would disqualify recent nursing 
school graduates from working at non-profit CMHCs. The commenters are 
requesting clarification of this requirement to include approved 
nursing school graduates who have ``education and/or training in 
psychiatric nursing,'' without specifying a length of time.
    Other commenters stated that psychiatric registered nursing is 
specialized nursing care and an integral component in the provision of 
services at CMHCs. As a result, those commenters recommended that CMS 
remove the word ``registered'' and broaden the definition of 
``psychiatric nurse'' so that it includes all licensed nurses who 
possess the requisite education and experience as outlined in the CoP. 
Furthermore, the commenters requested that the personnel requirement 
for psychiatric registered nurses remain in accordance with Sec.  
410.43(a)(4)(iii), ``trained psychiatric nurses,'' and eliminate the 
word ``Registered.'' Commenters also requested that psychiatric nurses 
be permitted to facilitate education groups and to perform mental 
health assessments in the CMHC setting, as allowed by state law.
    Response: We appreciate the comments regarding personnel 
requirements of the psychiatric registered nurse. We understand that 
some CMHCs may have more difficulty than others hiring a psychiatric 
registered nurse, due to location, salaries and competition. However, 
we believe that the role of the psychiatric registered nurse is 
specialized and essential to the care of a CMHC client. Therefore the 
requirements will remain as proposed. We note that, in addition to the 
psychiatric registered nurse, the CMHC may hire nurses such as licensed 
practical nurses (LPNs) or licensed vocational nurse (LVNs), as long as 
they meet the personnel requirements at 485.904(a). In response to 
commenters' concerns about the proposed work experience requirements, 
we have modified the time to 1 year in this final rule, and will allow 
the time spent in a psychiatric nursing rotation during nursing 
education to count towards the 1-year training requirement. We will 
provide further sub-regulatory guidance regarding the work experience 
requirements in the State operations manual, which will include 
interpretive guidelines for this section.
    Comment: Several commenters requested that CMS add definitions for 
``Advanced Practice Registered Nurse,'' ``Nurse Practitioner,'' or 
``NP'' to the personnel requirements. Commenters also requested that 
CMS require the Advanced Practice Registered Nurse to be educated 
specifically in psychiatric and mental health nursing with a minimum of 
a Master's degree, to have experience which includes both didactic and 
clinical components, advanced knowledge in nursing theory, physical and 
psychosocial assessment, nursing interventions, and management of 
health care. They also stated that the NP should be practicing under a 
collaborative practice agreement with a board eligible psychiatrist and 
may perform services to the extent established by the governing bylaws, 
but not beyond the scope of license, certificate or other legal 
credentials as defined by the State in which he/she is licensed or 
certified. Additionally, commenters stated that advanced practice 
nurses--both psychiatric mental health nurse practitioners (PMHNPs) and 
psychiatric mental health clinical nurse specialists (PMHCNSs) need to 
be included in the mix of health care providers who are authorized as 
gatekeepers to mental health services.
    Response: We appreciate the comments regarding the utilization of 
advanced practice nurses (APNs) in a CMHC. We agree that non-physician 
practitioners, such as the APN, are essential to the care of clients 
served in a CMHC. To address the comments related to the use of an APN 
for assessment and as a member of the treatment team, we modified 
language in both Sec.  485.914, ``Admission, initial assessment, 
comprehensive assessment and discharge or transfer of the client'' and 
Sec.  485.916, ``Treatment team, person-centered active treatment plan 
and coordination of services.'' These changes allow for APNs to serve 
in these roles, as permitted by State licensure. We also added a new 
element at Sec.  485.904(b)(9), ``Advanced practice nurse,'' which 
covers the personnel requirements for both the nurse practitioner and 
the clinical nurse specialist.
    Comment: A few commenters requested that CMS include language in 
the definition of ``psychiatrist'' for the purpose of CMHC oversight, 
as set out at Sec.  482.62(b)(1): ``A physician is qualified to take 
the examinations for board certification upon successful completion of 
a psychiatric residency program approved by the American Board of 
Psychiatry and Neurology and/or the American Osteopathic Board of 
Psychiatry and Neurology.'' Commenters agreed that qualified physician 
oversight of CMHC programs is of paramount importance. However, they 
stated that it is important that CMS clarify the personnel requirements 
to include psychiatrists who are board-certified or eligible to be 
board-certified. This clarification mirrors the CoP definition 
currently applied to inpatient psychiatric hospitals.
    Response: We appreciate the comments regarding the personnel 
requirements for a psychiatrist or psychiatrist eligible to be board-
certified. We believe the comment partially misquoted the regulation 
text. However, we agree with the commenters that it is of utmost 
importance to hire a board-certified psychiatrist. We also understand 
that it may not always be possible for a rural CMHC to employ a board-
certified psychiatrist. In the rare cases that the CMHC has 
demonstrated that it is unable to employ a board-certified 
psychiatrist, we would expect the CMHC to hire a highly qualified 
psychiatrist who has documented equivalent education, training or 
experience, and is fully licensed to practice medicine in the State in 
which

[[Page 64608]]

he or she practices. Therefore, in response to comments, we have 
modified that language by adding ``board certified or is eligible to be 
board certified''. Additional information and guidance regarding this 
requirement will be available in State operations manual, which 
includes the interpretive guidelines.
    Comment: A few commenters requested that we add ``activity 
therapist'' to the personnel definitions. The commenters stated that an 
activity therapist is an individual who possesses a Bachelor's-level 
education in behavioral science or a related field, and who is 
certified or licensed by the state to facilitate activity groups.
    Response: We appreciate the comments related to activity 
therapists. An activity therapist falls under the general 
qualifications requirement at Sec.  485.904. CMHCs that employ activity 
therapists will be expected to employ individuals who are legally 
authorized (licensed, certified or registered) in accordance with 
applicable Federal, State and local laws, and they must act within the 
scope of any State licenses, certifications, or registrations that 
apply to these employees. We also expect CMHCs to have defined 
personnel requirements for these individuals.
    Comment: Several commenters suggested CMS avoid the use of specific 
licensure requirements in the definition of ``Clinical Social 
Worker''(CSW) and instead reflect the clinician's education and 
experience level. The commenters recommended that CMS consider and 
adopt the following alternative: ``CMHCs must employ a full time 
Director of Social Services who is a Master's degree level clinician 
with a minimum of 2 years experience in providing care to the mentally 
ill and is licensed or certified to perform psychotherapy by the laws 
of the State in which the services are performed. Other clinicians may 
be utilized to provide psychotherapy provided they are licensed or 
certified to perform psychotherapy in the state in which the services 
are performed.'' The commenters' suggested language eliminates the use 
of licensing titles which are not uniform in all states and may 
potentially eliminate clinicians who are licensed and certified to 
provide services. Another commenter stated that unlike other health 
care settings, CSWs in CMHCs do not operate independently, but rather 
operate as part of a clinical team of personnel/staff rendering 
treatment services. They recommended that CMS' definition require that 
CSWs providing care in CMHCs possess a Master's degree and have a 
minimum of at least 2 years' experience in providing treatments to 
clients with mental disorders or severe disabilities. Commenters also 
stated that CSWs working in the CMHC setting should be licensed or 
certified to perform psychotherapy by the laws of the state in which 
the services are performed. According to the commenters, CMS should 
specify that additional types of clinicians may provide psychotherapy 
in the CMHC setting, provided these professionals are licensed or 
certified to perform psychotherapy in the state in which the services 
are performed.
    Some commenters believe that the clinical social worker definition 
should be expanded to reflect the services that they perform. The 
definition recommended by the commenters was ``Clinical social work 
services include the assessment, diagnosis, treatment, and prevention 
of mental illness, emotional, and other behavioral disturbances.''
    Response: We appreciate the comments regarding the personnel 
requirements of the clinical social worker. We agree that addressing 
the education and experience level of the CSW may be a more appropriate 
means to ensure quality treatment and to meet the needs of the 
different types of clients served in a CMHC. This will ensure that 
appropriate personnel will work with each client to meet individual 
needs. We agree that eliminating the use of licensing titles, which are 
not uniform in all states and may potentially eliminate clinicians who 
are licensed and certified to provide services, is appropriate in these 
circumstances. We believe that all CMHCs must strive to employ 
qualified individuals to provide social work services to clients and 
their families. To ensure CMHCs employ a qualified individual as a 
clinical social worker, we are requiring that at least one of the CMHC 
clinical social worker(s) must meet the qualifications at Sec.  410.73. 
If the CMHC chooses to also employ a social worker that does not meet 
Sec.  410.73, then, at a minimum, the social worker must meet one of 
the following requirements:
     Have a Bachelor's degree in social work (BSW) from an 
institution accredited by the Council on Social Work Education; or a 
Bachelor's degree in psychology or sociology, and be supervised by an 
MSW who meets the qualifications set out at Sec.  410.73 of this 
chapter.
    If a CMHC chooses to employ a social worker with a Bachelor's 
degree in social work, psychology or sociology, the services of the 
social worker must be provided under the supervision of a clinical 
social worker with an MSW or a doctoral degree in social work from a 
school of social work accredited by the Council on Social Work 
Education. Such BSW must also meet the qualifications set out at Sec.  
410.73 of this chapter. We believe that requiring MSW supervision of 
BSW services will help ensure that client needs are met. The MSW 
supervisor role is that of an active advisor, consulting with the BSW 
on assessing the needs of clients, developing and updating the social 
work portion of the active treatment plan, and delivering care to 
clients. The supervision may occur over the telephone, through 
electronic communication, or any combination thereof.
    Comment: A few commenters recommended that CMS add additional 
language to the definition of mental health counselors. Commenters also 
stated that CMS should allow for the mental health counselors to 
provide mental health assessments, as permitted by state law, in 
addition to the other service areas included in the proposed rule. 
Commenters clarified that under the Joint Commission's standards, 
mental health counselors are qualified to perform assessments. They 
stated that since providing mental health assessments for state mental 
health entities is a core service area required of CMHCs by Federal 
law, it is important that the assessments be listed among the services 
provided by mental health counselors as outlined in the proposed rule.
    Response: We appreciate the comments related to mental health 
counselors. The role of the mental health counselor is located at Sec.  
485.904(b)(5) under the personnel requirements. We agree the mental 
health counselors can provide mental health assessments, as defined by 
State law. Therefore, we modified the regulation text at Sec.  
485.904(b)(5), Mental health counselor, to include ``assessments.'' We 
have also modified the language at Sec.  485.914, ``Admission, initial 
evaluation, comprehensive assessment and discharge or transfer of the 
client,'' to allow for mental health counselors to provide the 
assessment of the client. Specifically, we have modified the language 
at Sec.  485.904(b)(5) by broadening the requirement to allow for a 
licensed mental health professional (acting within his or her state 
scope of practice requirements) to complete the initial evaluation and 
the comprehensive assessment.
    Comment: Some commenters stated that the personnel requirement for 
clinical psychologists at Sec.  485.904(b)(2) is vague and lacks 
quality assurance

[[Page 64609]]

needed to protect Medicare beneficiaries. Commenters requested that CMS 
consider specifying that the clinical psychologist must have graduated 
from a doctoral program that is accredited by the American 
Psychological Association or designated by the Association of State and 
Provincial Psychology Boards/National Register of Health Service 
Providers in Psychology.
    Some commenters raised concern that the standard contains no 
verification that the psychologists are trained in health service 
provisions and that only requiring a generic license to authorize the 
individual to engage in a variety of psychological services does not 
distinguish between individuals who are trained and experienced in 
health service provision and those who are trained in research, 
teaching, or industrial/organizational fields.
    Response: We appreciate the comments related to the psychologist 
personnel requirements. We agree that properly educated and trained 
health service psychologists will be strong CMHC team leaders. These 
standards will help improve client treatment, and hold CMHCs 
accountable for their care.
    We also agree that protecting the clients served by the CMHC is of 
great importance. The personnel requirements for psychologists at Sec.  
485.904(b)(2) reference the clinical psychologist qualification 
requirements at Sec.  410.71(d). We understand the importance of 
requiring the schools to be accredited. However, we do not have any 
data indicating that clinical psychologists graduating from non-
accredited programs reduces the level of quality care provided to 
clients served. Without formal evidence, modifying the psychologist 
personnel requirement in the CoPs would create a discrepancy between 
the conditions of participation and the payment policy requirements at 
Sec.  410.71(d).
    Comment: A few commenters recommended the inclusion of physician 
assistants (PAs) in the proposed community mental health center 
conditions of participation to enable CMHCs to utilize this group of 
practitioners as legally authorized in accordance with applicable 
federal, State and local laws. Commenters believe that the lack of 
specific inclusion of PAs in a standard can imply to surveyors that PAs 
are not authorized to deliver certain medical services. Other 
commenters stated that PAs in psychiatry expand access to mental health 
services. They often work in behavioral health facilities and 
psychiatric units of rural and public hospitals, where psychiatrists 
are in short supply. The commenters defined a physician assistant as 
``an individual who meets the qualifications and conditions as defined 
in section 1861(s)(2)(K)(i) of the Act and provides services, in 
accordance with State law, at Sec.  410.74.''
    Response: We appreciate the comments regarding PAs. We agree that 
PAs play an important role in behavioral health. Therefore we have 
modified the language at Sec.  485.904(b)(8) to set requirements for 
PAs, and have re-designated the remaining elements accordingly.
    Comment: One commenter requested that CMS recognize psychiatric 
technicians. The commenter stated that in California, and elsewhere in 
the United States, these direct-care staff are used by providers.
    Other commenters requested that CMS add requirements for mental 
health technicians and drivers. The commenters also expressed concern 
regarding the level of supervision of these employees. Furthermore, the 
commenters stated that many CMHCs employ drivers who also work as 
``Mental Health Techs''. It is unclear if these medically unlicensed 
individuals have direct contact with clients and if so, what level of 
supervision should be expected.
    Response: We appreciate the comments and suggestions regarding 
psychiatric technicians, mental health technicians and drivers. 
Psychiatric technicians, mental health technicians, and CMHC drivers 
all play important roles in the care of clients. However, we do not 
believe that we need to add personnel requirements for these positions 
at this time. We expect the CMHCs that utilize psychiatric technicians, 
mental health technicians, and drivers to clearly define their roles 
and functions (utilizing accepted standards of practice) within the 
CMHC's own policies, procedures and personnel requirements. We would 
also expect the CMHC to educate and train these staff members, just as 
they educate and train their other staff, related to the functions of 
the CMHC and care of the CMHC clients, confidentiality, safety, and any 
other areas the CMHC assesses as needed. For states that have licensing 
and regulatory requirements for the psychiatric technician, mental 
health technician, and driver we would expect the psychiatric 
technician, mental health technician, and driver to provide services in 
accordance with State law.
CMHC CoP: Client Rights (Sec.  485.910)
    We proposed to add a new CoP at Sec.  485.910. The proposed CoP was 
divided into six standards.
    At Sec.  485.910(a), ``Standard: Notice of rights and 
responsibilities,'' we proposed to set forth certain rights to which 
CMHC clients would be entitled, and to require that CMHCs inform each 
client verbally of these rights in a language and manner that the 
client or client's representative (if appropriate) or surrogate 
understands.
    We also proposed to require that the client be provided a written 
copy of client rights information. This information would have to be 
accessible to persons who have limited English proficiency (LEP).
    At Sec.  485.910(a)(1), we proposed that the notice of rights and 
responsibilities, including information concerning how to file a 
grievance, would be given to the client, the client's representative or 
surrogate, as appropriate, during the initial evaluation, as described 
at proposed Sec.  485.914(b).
    At Sec.  485.910(b), ``Standard: Exercise of rights and respect for 
property and person,'' we proposed that a client be able to exercise 
his or her rights, have his or her property and person respected, voice 
grievances, and not be subjected to discrimination or reprisal for 
exercising his or her rights.
    Furthermore, at Sec.  485.910(b)(2), we proposed procedures if the 
client has been adjudged incompetent under State law. At (b)(3), the 
proposed rule addressed the appointment of a legal representative. We 
also proposed at Sec.  485.910, ``Standard: Rights of the client,'' 
that the client would have the right to--(1) participate in the active 
treatment planning process; (2) refuse care or treatment; (3) have his 
or her records kept confidential; (4) be free from mistreatment, 
neglect, abuse, and misappropriation of his or her personal property; 
(5) receive information about limitations on CMHC services; and (6) not 
be compelled to perform services for the CMHC.
    At Sec.  485.910(d), ``Standard: Addressing violations of client 
rights,'' we proposed that CMHC personnel be required to report all 
complaints of alleged violations of clients' rights to the CMHC 
administrator. We also proposed that the CMHC immediately investigate 
all alleged violations, take intermediate actions to prevent further 
potential client rights violations during the investigation period, and 
take appropriate corrective action, where necessary. Furthermore, we 
proposed that the CMHC report the violations to appropriate authorities 
having jurisdiction within 5 working days of the CMHC becoming aware of 
the verified violations of client rights.
    We proposed the client rights CoP to act as a safeguard of client 
health and

[[Page 64610]]

safety. Open communication between CMHC staff and the client, and 
client access to information are vital to enhancing the client's 
participation in his or her coordinated active treatment plan. We also 
proposed to require all CMHCs to comply with Federal rules concerning 
the privacy of individually identifiable health information set out at 
45 CFR parts 160 and 164.
    At Sec.  485.910(e), ``Standard: Restraint and seclusion,'' we 
addressed the use of restraints and seclusion in a CMHC. We proposed 
that all clients have the right to be free from physical or mental 
abuse, and corporal punishment. Since accidental injuries and deaths 
have been documented in medical facilities due to the use of restraint 
and seclusion, we want to strongly discourage the use of restraints or 
seclusion in a CMHC environment where the clients are receiving 
services on an outpatient basis. However, we are aware that under 
extremely rare instances their application may be warranted for brief 
periods of time, and only while awaiting transport of the client to a 
hospital for evaluation and treatment when exhibiting behavior that 
threatens immediate harm to the client or others. In response to 
accidental injuries and deaths, we published hospital restraint and 
seclusion requirements on December 8, 2006 (71 FR 71378) that included 
a new standard at Sec.  482.13. The hospital restraint and seclusion 
CoP is the basis for the proposed CMHC restraint and seclusion CoP, 
with modifications to the regulatory requirements to accommodate this 
outpatient setting.
    The proposed restraint and seclusion standard was divided into five 
elements. These elements focused on the proper use of seclusion and 
restraints and the need for CMHC personnel to receive training and 
education on the proper use of seclusion and restraint application and 
techniques, as well as the use of alternative methods for handling 
situations that arise. The standard proposed specific requirements for 
physician orders for seclusion or restraint, along with a corresponding 
order for the client's immediate transfer to a hospital when restraint 
or seclusion is ordered. The standard also included a requirement that 
there must be specific documentation in the client's clinical record 
regarding the use of restraints.
    At Sec.  485.910(f), ``Standard: Restraint or seclusion: Staff 
training requirements,'' we address the training of the CMHC staff. The 
training consists of specific intervals, content and trainer 
requirements. Sec.  485.910(g), ``Standard: Death reporting 
requirements'' states that a CMHC would have to report to its CMS 
regional office no later than close of business the next business day, 
any death that occurs while a client is restrained or in seclusion 
while awaiting transfer to the hospital.
    Comment: A few commenters stated that all CMHCs should establish 
written policies and procedures regarding clients' rights.
    Response: We appreciate the feedback on establishing policies and 
procedures for clients' rights. We believe it is already current 
standard of practice and the responsibility of each CMHC to establish 
written policies and procedures regarding clients' rights and the 
rights of the client's representative (if appropriate) or surrogate. We 
have provided requirements for clients' rights that facilitate the 
development of these policies and procedures. We are clarifying that 
the client's representative or surrogate must be able to exercise the 
rights of the client if the client is unable to represent himself or 
herself.
    Comment: Commenters stated that the CMHC should be required to 
attempt to communicate with the client, and should be required to 
accommodate the client's communication needs, before opting to rely on 
a representative or surrogate.
    Additionally, commenters also stated that there should also be 
additional emphasis on the provision of sign language interpretation 
for individuals who are deaf, and alternative written formats such as 
Braille and large print for individuals who are visually impaired.
    Response: We agree that all CMHCs should attempt to communicate 
with the client first, and accommodate the client's communication 
needs. CMHCs must take appropriate steps to ensure effective 
communication with their clients and provide auxiliary aids and 
services to accommodate the client's communication needs. There are 
specific civil rights statutes that address the obligation of covered 
entities to provide appropriate auxiliary aids and services, such as 
Braille and large print to individuals with disabilities.
    Section 504 of the Rehabilitation Act of 1973 prohibits 
discrimination on the basis of disability in programs or activities 
that receive Federal financial assistance. Therefore, as recipients of 
Federal financial assistance (that is, loans, grants, or Medicare or 
Medicaid reimbursements), CMHCs must comply with the nondiscrimination 
requirements. Furthermore, there are also several sections of the 
Americans with Disabilities Act (ADA) that require facilities, such as 
CMHC providers, to provide appropriate accommodations for their 
clients. Since section 504 and the ADA provisions are applicable to 
CMHCs, we are not addressing the specifics of these requirements in the 
CoPs.
    Comment: One commenter suggested that CMS should require a CMHC 
with a clientele that is more than 25 percent non-English speaking to 
provide written translations of clients' rights information in the 
relevant language(s).
    Response: We appreciate the feedback that if the CMHC clientele is 
over 25 percent non-English speaking, the CMHC must provide written 
translations of clients' rights information in the relevant languages. 
We recognize that this is an area of concern for CMHCs, as it may be 
challenging for CMHCs to communicate with clients who speak languages 
other than English. The HHS guidance on Title VI (August 8, 2003, 68 FR 
47311) applies to those entities that receive Federal financial 
assistance from HHS, including CMHCs. CMHCs are already expected to 
comply with the HHS guidance, which requires the CMHC to take 
reasonable steps to provide meaningful access to its programs or 
activities. CMHCs should take reasonable steps to provide meaningful 
access to persons with LEP. This may involve securing a qualified 
interpreter for CMHC-client communications, including those involving 
the notice of clients' rights. Providing meaningful access may also 
involve the CMHC translating written copies of the notice of rights 
available in the language(s) that are commonly spoken in the CMHC 
service area. As explained in the HHS LEP guidance at http://www.gpo.gov/fdsys/pkg/FR-2003-08-08/pdf/03-20179.pdf (section VI B), 
use of an oral interpreter presents a set of complex issues. For 
example, use of family members or friends as interpreters may be 
actively sought by some patients but may present a danger to the 
patient in other cases. What is required of CMHCs in particular 
communities will depend on what HHS terms a ``four factor analysis,'' 
taking into account availability of interpreters, how many languages 
are commonly or rarely encountered among CMHC clients, and other 
situational factors. For additional information related to LEP, the 
Department of Health and Human Services recently released a new 
document highlighting the departments commitment to LEP, which is 
located at the following Web site: http://www.hhs.gov/open/execorders/13166/index.html.
    Comment: Some commenters stated that a 5-day timeframe for 
violation reporting is too long. Other commenters

[[Page 64611]]

stated that the reliance on internal procedures and self-regulation may 
cause CMHCs to determine that most violations do not require any type 
of corrective action or reporting because of the fear of repercussions 
from State regulatory agencies or CMS.
    Response: We understand that the 5 working days timeframe may seem 
too long. However, the CMHC may require a shorter timeframe through its 
policies and procedures. The CMHC is required to immediately report an 
incident to the administrator, who must immediately investigate all 
alleged violations. The CMHC must take action to prevent further 
potential violations while the alleged violation is being verified. 
This process begins as soon as the alleged violation is discovered and 
will likely be resolved sooner than 5 days. Additionally, because CMHCs 
are not residential facilities, it is unlikely that the involved client 
will be in the facility during the entire 5-day period.
    We also understand the commenters' concern with the CMHC internal 
investigation procedures. We believe requiring CMHCs to investigate 
potential violations of client rights by CMHC staff (including 
contracted or arranged services) may represent a conflict of interest, 
or insufficient to protect clients and their families.
    For this reason, we are amending the requirement at Sec.  
485.910(d)(4) to require that all violations be reported to State 
survey and certification agencies, and verified by the appropriate 
investigator, violations also be reported to State and local entities 
having jurisdiction. While we understand the commenters' concern with 
the CMHC internal investigation procedures, we believe requiring CMHCs 
to investigate potential violations of client rights by CMHC staff 
(including contracted or arranged services) will protect clients and 
their families. Reporting violations, when verified in accordance with 
CMHC policies and procedures and any applicable State and local laws 
and regulations related to client health and safety, is an integral 
part of improving the quality of CMHC care provided to Medicare 
beneficiaries. Ultimately the CMHC must follow Federal and State laws 
related to client health and safety, as well as follow its own internal 
policies and procedures. We expect significant violations, such as 
illegal actions by CMHC staff, to be reported to State and local 
authorities. We believe that the framework in this regulation, coupled 
with a CMHC's own policies and procedures and State and local 
requirements related to client health and safety, will allow CMHCs to 
adapt the requirements to the particular needs and concerns of their 
client populations now and in the future.
    If State requirements for reporting violations are stricter than 
our Federal requirements, the stricter State requirements would take 
precedence. Stricter State requirements may be those that require 
violations to be reported regardless of whether they are verified, or 
requirements that verified violations be reported in less than five 
days. However, if State requirements are less stringent than Federal 
requirements, then the Federal requirements will take precedence.
    Comment: One commenter stated that there should be a limit to the 
number of clients attending a group session. Specifically, the 
commenter requested that CMS add an additional requirement at Sec.  
485.910(c), ``Standard: Rights of the client,'' limiting a PHP group 
maximum size to 12-15 clients. The commenter stated that this would 
help to ensure all clients receive full benefit from PHP sessions.
    Response: We appreciate the commenter's concern regarding the 
number of clients attending a group session. We believe that the CMHC 
would need to determine, through its policies, procedures, and 
guidelines related to group therapy sessions, what is appropriate for 
each client. There are many different acuity levels and needs for CMHC 
clients which may require larger or smaller group sizes. All the 
participants within a given group should have the same acuity level and 
group session treatment goal. A group's size should be based on the 
needs and abilities of its participants. A group should not be too 
small to prevent the benefit of learning and sharing from other 
participants that occurs in a ``group,'' nor too large as to prevent 
all members from the benefit of actively participating. We expect the 
CMHC and the client's therapist or team will exhibit sound clinical 
judgment and clinical practice when assigning a client to a particular 
group or group psychotherapy and when developing the actual group. 
Therefore, we will leave it up to the clinical expertise and sound 
professional judgment of the CMHC trained staff to determine what works 
best for each client. For each client there is a periodic reassessment 
and review of the client's progress. This review will allow adjustments 
for such treatments, including the size of the group to which the 
client belongs or the need for individualized therapy.
    Comment: Several commenters stated that restraint and seclusion are 
not used in CMHCs. Therefore, they believe training of staff should 
focus on de-escalation techniques. Commenters stated that following 
established procedures for involuntary hospitalization should minimize 
or completely eliminate the need to use restraint and/or seclusion. 
Likewise, other commenters stated that State law prohibits CMHCs from 
using seclusion and restraint in any program. As a result, CMHCs no 
longer train staff on these prohibited practices. Instead, CMHCs train 
staff in de-escalation techniques and crisis management. Furthermore, 
some commenters stated that there is no evidence that CMHCs' use of 
seclusion or restraint is a concern, and the training and reporting 
requirements would create administrative and financial burdens.
    Response: We appreciate the feedback from the commenters on 
restraint and seclusion. We agree that if State law is more stringent 
than Federal law, State law takes precedence. That is, if the use of 
seclusion and restraint is prohibited by the State, then the CMHC is 
not allowed to use seclusion and restraint techniques in the process of 
providing services to CMHC clients. The requirements at Sec.  
485.910(f)(1) and (f)(2) state that training of CMHC staff focuses on 
techniques to identify staff and client behaviors, events and 
environmental factors that may trigger circumstances that require the 
use of restraint or seclusion, as well as the use of nonphysical 
intervention skills. We believe that training CMHC staff to identify 
potential triggers and to use positive behavioral intervention supports 
and nonphysical intervention skills, also known as de-escalation 
techniques, is compatible with State law even in states that expressly 
prohibit the use of seclusion and restraint techniques. While the 
concepts are related, identifying triggers and using nonphysical 
interventions are not the same as using seclusion and restraint 
techniques. Therefore, all CMHCs, even those located in states that 
prohibit the use of seclusion and restraint techniques, are required to 
train their staff in the use of nonphysical interventions in order to 
assure the safety of all clients and staff. Training on nonphysical 
interventions could be incorporated into the CMHC staff in-service 
training requirements at Sec.  485.918(d)(3). This type of training 
meets the requirements of the regulation.
    We emphasize that in states where the use of seclusion and 
restraint techniques are permitted, they may only be used to protect 
the client or others from immediate harm, and their use would trigger 
immediate transportation to a hospital. In the rare occurrence that a 
restraint and seclusion order is

[[Page 64612]]

needed, the duration of the order is for 1 hour. If there is a delay in 
the arrival of client transport extending past the 1 hour order 
duration, a second order would need to be obtained. We believe that if 
this delay occurs, it is in the best interest of the health and safety 
of the client that a re-assessment of the client's condition be made to 
determine if restraints remain necessary, before the second order is 
obtained.
    Comment: A few commenters stated that restraint and seclusion death 
reporting should be expanded to include the reporting of deaths that 
occur as the result of abuse or neglect. Other commenters requested an 
additional requirement, such as reporting the incident to the relevant 
protection and advocacy agency. One commenter recommended that CMS be 
very specific in defining what it means by ``attributed to.'' 
Commenters recommended that reporting should be required only when 
restraint and seclusion was determined to be a direct cause of death. 
Additionally, commenters stated that CMS should investigate the death 
as part of the complaint survey investigation process.
    Response: We agree with the commenters on reporting deaths that 
occur as a result of abuse or neglect. We expect that a health care 
provider or agency that believes a CMHC client is the subject of abuse 
or neglect will report the concern to the proper State authorities. 
This requirement falls under Sec.  485.910(d)(1), to ensure that all 
alleged violations involving abuse or neglect are reported immediately 
to the CMHC administrator. An investigation should immediately occur 
and procedures should be put in place to prevent further potential 
violations while the alleged violation is investigated. The CMHC is 
then required to take appropriate corrective action in accordance with 
State law (which may include contacting appropriate advocacy agencies), 
if the alleged violation is verified by the CMHC administration or 
verified by an outside entity having jurisdiction.
    Should a seclusion or restraint-related death occur, our intent is 
to ensure that the CMHC immediately notify CMS and begin to fully 
investigate the death. Waiting to determine if the death was directly 
caused by the use of restraint or seclusion could potentially have 
negative impact on other clients being served by the CMHC. We 
acknowledge that seclusion and restraint are rarely, if ever, used and 
that the likelihood of death ever having to be reported is extremely 
low. However, it is imperative that the CMHC report any instance where 
a death of a client is associated with the use of seclusion or 
restraint. Should a seclusion or restraint-related death occur, we 
would initiate an onsite complaint survey of the CMHC in accordance 
with the existing complaint investigation process.
CMHC CoP: Admission, Initial Evaluation, Comprehensive Assessment and 
Discharge or Transfer of the Client (Sec.  485.914)
    We proposed to add a new CoP at Sec.  485.914 to establish 
requirements for admission, initial evaluation, comprehensive 
assessment, and discharge or transfer of the client. The proposed CoP 
at Sec.  485.914 identified general areas that would be included in a 
client assessment and the timeframes for completing the assessments to 
help the CMHC ensure it was identifying the needs in all areas in a 
timely fashion. The proposed CoP was divided into five standards.
    At Sec.  485.914(a), ``Standard: Admission,'' we proposed to 
require the CMHC to determine whether a client is appropriate for the 
services the CMHC provides. At Sec.  485.914(b), ``Standard: Initial 
evaluation,'' we proposed to require the CMHC psychiatric registered 
nurse or clinical psychologist to complete the initial evaluation. We 
stated that the care needs identified in the initial evaluation would 
include, but would not be limited to, those necessary for treatment and 
management of the psychiatric illness. We also specified that the 
initial assessment would be completed within 24 hours of the client 
admission to the CMHC.
    At Sec.  485.914(c), ``Standard: Comprehensive assessment,'' we 
proposed that a physician-led interdisciplinary team, in consultation 
with the client's primary health care provider (if any), complete the 
comprehensive assessment. We stated that the comprehensive assessment 
would build from the initial evaluation and identify the client's 
physical, psychological, psychosocial, emotional and therapeutic needs. 
The interdisciplinary team would be composed of a doctor of medicine, 
osteopathy or psychiatry; a psychiatric registered nurse, a clinical 
psychologist, a clinical social worker, an occupational therapist, and 
other licensed mental health counselors, as necessary. Each member of 
the team would provide input within the scope of that individual's 
practice. As proposed, the comprehensive assessment would include 
information about the client's psychiatric illness and history, 
complications and risk factors, drug profile review, and the need for 
referrals and further evaluations by appropriate health care 
professionals. The comprehensive assessment would be completed within 3 
working days after the admission to the CMHC.
    At Sec.  485.914(d), ``Standard: Update of the comprehensive 
assessment,'' we proposed that the CMHC would update the comprehensive 
assessment via the physician-led interdisciplinary treatment team, in 
consultation with the client's primary health care provider (if any), 
no less frequently than every 30 days, and when changes in the client's 
status, response to treatment, or goals occurred. The update would have 
to include information on the client's progress toward desired 
outcomes, a reassessment of the client's response to care and 
therapies, and the client's goals. We believe that these frequent 
reviews are necessary since clients with ongoing mental illness may be 
subject to frequent and/or rapid changes in status, needs, acuity, and 
circumstances, and the client's treatment goals may change, thereby 
affecting the type and frequency of services that should be furnished. 
The physician-led interdisciplinary treatment team would use assessment 
information to guide necessary reviews and/or changes to the client's 
active treatment plan.
    At Sec.  485.914(e), ``Standard: Discharge or transfer of the 
client,'' we proposed that the CMHC complete a discharge summary and 
forward it to the receiving facility/provider, if any, within 48 hours 
of discharge or transfer from the CMHC. If the client is being 
discharged due to non-compliance with the treatment plan, the CMHC 
would forward the discharge summary and, if requested, other pertinent 
clinical record information to the client's primary health care 
provider (if any). The discharge summary would be required to include--
(1) a summary of the services provided while a client of the CMHC, 
including the client's symptoms, treatment and recovery goals and 
preferences, treatments, and therapies; (2) the client's current active 
treatment plan at the time of discharge; (3) the client's most recent 
physician orders; and (4) any other documentation that would assist in 
post-discharge continuity of care. Furthermore, under this standard we 
proposed that the CMHC would have to adhere to all Federal and State-
related requirements pertaining to medical privacy and the release of 
client information. We believe this standard would help ensure that the 
information flow between the CMHC and the receiving entity was smooth, 
and that the appropriate care continued without being compromised 
(where applicable).

[[Page 64613]]

    Comment: Several commenters stated that under Medicaid and State 
law, CMHCs are allowed a wide range of staff to provide initial 
evaluations, from unlicensed, Master's level practitioners (under 
supervision of a licensed professional) to licensed Master's level 
clinicians, including social workers and counselors. Commenters also 
stated that State laws allow for licensed clinical social workers 
(LCSWs) or other mental health counselors to conduct initial 
evaluations. Other commenters stated that use of a psychiatric RN or 
clinical psychologist to conduct the initial evaluation should only 
apply to PHP programs.
    Response: We appreciate the comments regarding the appropriate 
staff to conduct an initial evaluation. We understand currently that 
there may be several different staff the CMHC uses to conduct an 
initial evaluation, and that the types of staff used may vary from 
State to State. While it may be appropriate for a psychiatric RN or 
psychologist to conduct an initial evaluation on a client, we 
understand that this may not be appropriate for all clients and is not 
necessarily a standard of practice in the CMHC setting. We would expect 
the CMHC to assign the most appropriate mental health professionals to 
conduct the initial evaluation. Therefore, the CMHC may add additional 
requirements under their policy and procedures to require the initial 
evaluation on all PHP clients to be conducted by a psychiatric RN, 
acting within his or her State's scope of practice, or by a clinical 
psychologist, who meets the qualifications in Sec.  410.71(d), acting 
within his or her State's scope of practice. We have removed the 
requirement that a psychiatric RN or clinical psychologist conduct the 
initial evaluation.
    We also understand that there may be unlicensed staff (completing 
their education or licensure requirements) conducting initial 
evaluations under the supervision of a licensed professional. We 
believe that the initial evaluation is paramount in meeting the 
immediate needs of the client and beginning the active treatment plan. 
Therefore, we have amended the language at Sec.  485.914(b)(1) to allow 
a licensed mental health professional acting within his or her State 
scope of practice to conduct the initial evaluation. We will allow 
staff working towards completing their education or licensure 
requirements to complete the initial evaluation under the direct 
supervision of a licensed mental health professional (as required by 
all State law and regulations related to the supervision of unlicensed 
professionals and students) employed by the CMHC.
    Comment: One commenter stated the CMHC should be required to notify 
a client's primary care provider, if any, in lieu of a formal 
consultation. The commenter stated that such notification would be 
contingent upon a client's understanding and consent.
    Response: This comment was somewhat unclear. We believe it is 
referring to communication between the CMHC and the client's primary 
care provider during the comprehensive assessment. We agree with the 
commenter that the CMHC should obtain consent from the client when 
sharing information between the CMHC and the PCP. Therefore, we have 
amended the language at Sec.  485.914(c)(4)(ii) regarding the CMHC 
receiving the client's consent before client information is obtained or 
shared with the client's primary care provider.
    Comment: Commenters asked to add additional assessment criteria 
such as environmental factors. Commenters stated that strengths and 
barriers related to a client's home, work, or social environments can 
play a critical role in the success or failure of key interventions.
    Response: We agree that it is important to assess environmental 
factors related to the home and work environments in the overall 
development and coordination of the active treatment plan. Furthermore, 
we believe the assessment and coordination of information related to 
environmental factors such as housing and employment services, as well 
as the client's preferences and personal goals, are essential in 
developing a recovery focused active treatment plan and to meeting the 
client's recovery goals. Therefore we amended the assessment language 
at Sec.  485.14(b)(4)(v) to include environmental factors and at Sec.  
485.16(e)(5) to include coordination of services with other healthcare 
and non-medical providers.
    We would like to stress the importance of client privacy and 
confidentiality and remind CMHCs that HIPAA applies to release of 
protected health information by CMHCs; it is generally prohibited to 
release client information to non-health care entities without the 
express consent of the client. If CMHCs do release such information to 
state or local agencies, they must generally obtain consent from the 
client before such release.
    Comment: Some commenters believe that the medication review should 
be limited to requiring that the partial hospitalization program 
maintain only a current list of the individual's medications, 
prescriptions and over-the-counter medications, as well as contact 
information for the treating practitioner of the individual served.
    Response: We appreciate the comments on medication review. We 
believe that listing the current medications (both prescription and 
over-the-counter) is extremely important for all clients during the 
initial evaluation. The information documented will be reviewed during 
the comprehensive assessment and may impact the development of the 
active treatment plan. Therefore, we believe that the documentation of 
current medications is essential to the start of care for the CMHC 
clients.
    Comment: Commenters stated that a psychiatrist should be required 
to address medication management.
    Response: We appreciate the comments regarding a psychiatrist 
addressing medication management. The initial evaluation requires 
documentation of both prescription and over-the-counter medications. 
The comprehensive assessment requires a drug profile that includes a 
review of all of the client's prescription and over-the-counter 
medications; herbal remedies; and other alternative treatments or 
substances that could affect drug therapy. We expect the drug profile 
section of the comprehensive assessment to be completed by a CMHC 
licensed mental health professional (such as the psychiatrist, MD or 
nurse practitioner) with the appropriate knowledge, skills, and 
certification or licensure, and acting within his or her State's scope 
of practice, to assess drug therapy.
    Comment: Commenters stated that a CMHC should be assessing the 
social service needs of pediatric clients. They also stated that, when 
appropriate, a referral should be made to social services, child 
welfare, and/or the juvenile justice system for pediatric clients.
    Response: We agree that assessing for the social service needs of 
pediatric clients is very important. We expect that the assessment of a 
pediatric client would include social service and child welfare 
questions. We also expect that a referral be made to social services 
and/or child welfare services, if appropriate. Therefore, we have added 
language at Sec.  485.914(c)(4)(xiv) to address the pediatric 
assessment.
    Comment: Some commenters stated that additional assessment criteria 
should be added to the comprehensive assessment. Commenters stated that 
CMHCs should assess for client strengths and goals, as well as a 
history of trauma.

[[Page 64614]]

    Response: We agree that it is important to assess the client for 
strengths, goals and a history of trauma. We believe that a history of 
trauma is already incorporated into the regulation language at Sec.  
485.914(c)(4)(ii) and (iii). These sections outline the assessment 
expectation of the psychiatric evaluation, which would review medical 
history and severity of symptoms, as well as assessment information 
concerning previous and current medical status, including but not 
limited to, previous therapeutic interventions and hospitalizations. 
Section Sec.  485.915(c)(4)(viii) addresses clients' goals and requires 
the client to be assessed for functional status, including the client's 
ability to understand and participate in his or her own care, and the 
client's strengths and goals.
    Comment: Some commenters stated that CMS should change the 
comprehensive assessment timeframe from 3 working days to 7 program 
days. Other commenters stated the assessment time-frames should be 
extended from 3 working days to 5 working days.
    Response: We appreciate the comments related to the assessment 
timeframe. However, we are unclear on what the commenters meant by 
``program days''. The commenters did not clarify or give examples 
regarding the term ``program days''. We use the term ``working days'', 
which allows the CMHC to not count the days that the CMHC is closed. 
Other commenters asked that we extend the time-frame for completion of 
the assessment. We understand that the clients a CMHC may see vary 
greatly in their treatment needs and that assessing a complex client 
may take longer than 3 working days. However, we believe that all 
clients should be assessed in a timely manner regardless of their 
diagnosis. Therefore, we have amended the timeframe for the assessment 
at Sec.  485.914(c)(2) from 3 working days to 4 working days, with day 
1 starting the day after admission. For example, if a client is 
admitted on a Friday, the CMHC would need to have the comprehensive 
assessment completed within 4 working days, which would be by Thursday.
    Comment: A few commenters requested that we extend the permissible 
timeframe for a CMHC to prepare and forward a discharge summary to a 
receiving facility or provider, if any, to 30 days from the date of 
discharge. The commenters stated that the proposed 48-hour requirement 
is inconsistent with the existing requirement for inpatient psychiatric 
providers and unnecessarily places an administrative burden upon CMHCs.
    Response: We appreciate the comments related to forwarding the 
discharge summary. We acknowledge that there is a 30-day discharge 
paperwork requirement for discharge from an inpatient psychiatric 
facility. However, the inpatient discharge expectation is that the 
client summary information is sent at the time of discharge to the 
receiving entity. Best practices would suggest that at discharge there 
would be no break in service and that the receiving entity receive the 
appropriate information to continue to meet the needs of the client. 
However, we understand that a CMHC is open during regular business 
hours and requiring a 48-hour timeframe may be unreasonable. Therefore, 
we modified the language at Sec.  485.914(e)(1) to require the CMHC to 
forward the discharge summary to the receiving entity or practitioner 
within 2 working days after the discharge. For example, if a client 
discharges from the CMHC on Friday the discharge summary should be sent 
to the receiving provider by close of business on Tuesday.
    Comment: A few commenters asked who should be responsible for 
ensuring the discharge plan is complete.
    Response: The discharge process is part of the client's active 
treatment plan and should be discussed and incorporated in the plan 
from the initial evaluation. The interdisciplinary team is responsible 
for the care and services for each client. Moreover, Sec.  
485.916(a)(2) requires the CMHC to determine the appropriate licensed 
mental health professional, who is a member of the client's 
interdisciplinary treatment team, to coordinate care and treatment 
decisions with each client, to ensure that each client's needs are 
assessed, and to ensure that the active treatment plan is implemented 
as indicated. Best practices would suggest that this coordinator would 
also manage the discharge process of the client. However, the CMHC has 
the flexibility to have any licensed professional who serves on the 
client's interdisciplinary treatment team coordinate the discharge 
plan.
    Comment: One commenter asked that we eliminate the requirements 
regarding discharge for non-compliance.
    Response: While we understand the commenter's concern regarding 
discharge for non-compliance, and believe that this rarely happens, we 
believe the CMHC wants to serve its clients to the best of its ability. 
Unfortunately, when a client is non-compliant with his or her active 
treatment plan, it may be in the best interest for both the client and 
the CMHC to discharge the client to a care level that meets the 
client's needs. If non-compliance became an issue for a client, the 
client's interdisciplinary team would need to document that it 
addressed the issue and tried repeatedly to work with the client and 
family, and that discharge was the last option. The CMHC must ensure 
that the client's discharge information is forwarded to the appropriate 
practitioner as required in Sec.  485.914(e).
CMHC CoP: Treatment Team, Person-Centered Active Treatment Plan, and 
Coordination of Services (Sec.  485.916)
    We proposed to add a new CoP at Sec.  485.916 to establish 
requirements for an active treatment plan and coordination of services.
    At Sec.  485.916(a), ``Standard: Delivery of services,'' we 
proposed that the CMHC designate a physician-led interdisciplinary team 
for each client. We proposed that the interdisciplinary team include a 
psychiatric registered nurse, clinical psychologist, or a Master's 
level prepared or Doctoral level prepared social worker, who would be a 
coordinator responsible, with the client, for directing, coordinating 
and managing the care and services provided to the client. The team 
would be composed of individuals who would work together to meet the 
physical, medical, psychosocial, emotional, and therapeutic needs of 
CMHC clients.
    The CMHC would designate a psychiatric registered nurse, clinical 
psychologist or clinical social worker who was a member of the 
interdisciplinary treatment team to coordinate care, ensure the 
continuous assessment of each client's needs, and ensure the 
implementation and revision of the active treatment plan. Depending on 
the number and/or type of clients served by the CMHC, the CMHC may have 
more than one interdisciplinary team. If so, the CMHC is required to 
designate one treatment team responsible for establishing policies and 
procedures governing the day-to-day operations of the CMHC, and the 
care and services provided to clients.
    At Sec.  485.916(b), ``Standard: Active treatment plan,'' we 
proposed to require that all CMHC services furnished to clients follow 
a written active treatment plan established by the CMHC physician-led 
interdisciplinary treatment team and the client (and representative, if 
any), in accordance with the client's psychiatric needs and goals 
within 3 working days after the client's admission to the CMHC. The 
CMHC would have to ensure that each client and, if relevant, primary

[[Page 64615]]

caregiver(s), received education and training that was consistent with 
the client's and caregiver's responsibilities, as identified in the 
client-specific active treatment plan. Education is necessary to ensure 
that the client and caregiver understand the services and treatments 
contained in the active treatment plan, and their roles in actively 
participating in, and following the plan.
    At Sec.  485.916(c), ``Standard: Content of the active treatment 
plan,'' we proposed to require that each client's active treatment plan 
reflects client goals and interventions for problems identified in the 
comprehensive and updated assessments. This proposed requirement would 
ensure that care and services were appropriate to the level of each 
client's specific needs. The active treatment plan would include all of 
the services necessary for the care and management of the psychiatric 
illness. We would also require a detailed statement of the type, 
duration and frequency of services, including social work, counseling, 
psychiatric nursing and therapy services. Services furnished by other 
staff trained to work with psychiatric clients necessary to meet the 
specific client's needs should also be documented. The 
interdisciplinary treatment team should document the client's and 
representative's (if any) understanding, involvement, and agreement 
with the active treatment plan, in accordance with the CMHC's own 
policies. This would include information about the client's need for 
services and supports, and treatment goals and preferences.
    At Sec.  485.916(d), ``Standard: Review of the active treatment 
plan,'' we proposed that a revised active treatment plan be updated 
with current information from the client's comprehensive assessment and 
information concerning the client's progress toward achieving outcomes 
and goals specified in the active treatment plan. The active treatment 
plan would have to be reviewed at intervals specified in the plan, but 
no less frequently than every 30 calendar days.
    At Sec.  485.916(e) ``Standard: Coordination of services,'' we 
proposed to require that the CMHC maintain a system of communication 
and integration to enable the interdisciplinary treatment team to 
ensure the overall provision of care and the efficient implementation 
of day-to-day policies and procedures. This proposed standard would 
also make it easier for the CMHC to ensure that the care and services 
are provided in accordance with the active treatment plan, and that all 
care and services provided are based on the comprehensive and updated 
assessments of the client's needs. An effective communication system 
also enables the CMHC to ensure the ongoing sharing of information 
among all disciplines providing care and services, whether the care and 
services are being provided by employees or by individuals under 
contract with the CMHC.
    Comment: Several commenters stated that the family and/or 
significant other should be included in the active treatment planning 
process.
    Response: We appreciate the suggestion to add family and/or 
significant other involvement in the active treatment plan. We agree 
with the commenters, but prefer to use the term ``primary caregiver'' 
instead of family and/or significant other. The term ``primary 
caregiver'' is a broader term that encompasses family and significant 
others but also represents caregivers such as friends or significant 
others. Therefore, we have amended the language at Sec.  485.916(b), 
``Standard: Active treatment plan'' to add ``primary caregiver.''
    Comment: Many commenters believe that the proposed CoPs were over-
reaching in requiring an interdisciplinary team (IDT) which ``would 
include'' many disciplines. Commenters stated that CMS should replace 
``would include'' with ``may include'' in order to allow for the 
individualization of the treatment planning for each client. Other 
commenters disagreed with CMS regarding the staff requirements for the 
IDT being standard medical practice.
    Response: We agree with the comments related to the members of the 
IDT. We understand that CMHC clients vary from clients receiving PHP to 
clients receiving short term counseling or medication management. We 
believe there may be clients who, based on their diagnosis and 
assessment, may only need a one-person IDT to meet their care needs. 
For example, a client who is being treated for medication management 
may be required to be seen by a practitioner a couple of times a year. 
Therefore, the proposed ``one size fits all'' approach to the IDT 
membership may not serve the client's interests and potentially takes 
away from the CMHC's flexibility to serve the client's needs, and the 
needs of other clients. Therefore, we have amended the language at 
Sec.  985.916(a)(2) to allow the CMHC to determine (based on the 
findings of the client's comprehensive assessment), the appropriate 
licensed mental health professionals and other CMHC staff to serve on 
the client's interdisciplinary team. The amended language now states 
that the interdisciplinary team may include: A doctor of medicine, 
osteopathy or psychiatry (who is an employee of or under contract with 
the CMHC), a psychiatric registered nurse, a clinical social worker, a 
clinical psychologist, an occupational therapist, other licensed mental 
health professionals, and other CMHC staff, as necessary. We note that 
the interdisciplinary team membership must be based on the client's 
assessed needs. CMHCs will be expected to demonstrate a correlation 
between the client's comprehensive assessment, assessed needs, members 
serving on the interdisciplinary team, and the active treatment plan. 
Therefore a PHP client's interdisciplinary team members are likely to 
be different than the client who is being treated by the CMHC for 
short-term counseling or medication management.
    Comment: A few commenters stated that CMHCs often do not have the 
resources to engage a physician in leading team care, treatment, and 
services planning. According to commenters, there is no recognized data 
to demonstrate improved outcomes in PHPs by having a physician leading 
the care team. Other commenters stated that the concept of a 
collaborative healthcare team should not be restricted to a 
``physician-led interdisciplinary team'' as it may be more achievable 
if viewed as an interdisciplinary team that includes a physician. The 
commenters also believe that a physician-led interdisciplinary team 
limits the capacity of advanced practice registered nurses, nurse 
practitioners and clinical psychologists, who are qualified and 
licensed to lead interdisciplinary teams.
    Response: We appreciate the comments regarding the physician 
leading the interdisciplinary team. We proposed this standard to ensure 
physician involvement in the interdisciplinary team process. However, 
we agree that there is no documented research that demonstrates 
improved outcomes in PHPs by having a physician leading the team, and 
such a requirement may limit collaboration and the role of the other 
qualified practitioners. Therefore, based on the client's needs, in 
addition to a physician, we have amended the language at Sec.  
485.916(a)(1), to now allow for a nurse practitioner, a clinical nurse 
specialist, a clinical psychologist, a physician assistant, or clinical 
social worker to serve as the leader of the team, if permitted by State 
law and within his or her scope of practice. This allows the CMHC 
greater flexibility to meet the client's needs. We stress that while 
this change allows additional

[[Page 64616]]

advanced practice practitioners to lead the team, it in no way 
minimizes the physician's involvement in managing the medical component 
of the client's care and/or serving on the interdisciplinary group.
    In the instance of partial hospitalization, clients need acute 
services and must be under the care of a physician. According to the 
statutory requirements, which are implemented in CMS regulations at 42 
CFR 424.24(e), PHP services must be prescribed by a physician and under 
the supervision of a physician pursuant to an individualized, written 
plan of treatment established and periodically reviewed by a physician 
(in consultation with appropriate staff participating in such program). 
Furthermore, upon admission, a physician must certify that in absence 
of PHP services, the person would otherwise require inpatient 
psychiatric treatment. If continued PHP treatment is necessary, a 
physician must recertify as of the 18th day of treatment and no less 
than every 30 days after that documenting the need for this level of 
service. Therefore, a physician is inextricably involved in a PHP 
client's treatment team.
    Comment: Several commenters stated that advanced practice nurses, 
including both psychiatric mental health nurse practitioners (PMHNPs) 
and psychiatric mental health clinical nurse specialists (PMHCNSs), 
need to be included in the list of professionals who can lead 
multidisciplinary teams. Other commenters stated that occupational 
therapists, social workers and other licensed mental health counselors 
should be added to the list of professionals who can serve as 
coordinators.
    Response: We appreciate the comments regarding leading the 
interdisciplinary team. There are two different requirements in the 
proposed CoPs where we discuss leadership of the interdisciplinary 
team. In Sec.  485.916(a)(1), we proposed that the interdisciplinary 
team be led by a physician. We proposed this standard to ensure 
physician involvement in the interdisciplinary team process. However, 
we agree that allowing a nurse practitioner, a clinical nurse 
specialist, a physician assistant, or a psychologist would allow the 
CMHC greater flexibility to meet the client's needs. While we allow for 
additional advanced practice practitioners to lead the team, that in no 
way minimizes the physician involvement in managing the medical 
component of the client's care.
    At Sec.  485.916(a)(2), we proposed a psychiatric registered nurse, 
a clinical psychologist, or a clinical social worker, who is a member 
of the interdisciplinary team to coordinate care and treatment 
decisions with each client, to ensure that each client's needs were 
assessed and to ensure the active treatment plan was implemented as 
indicated. We understand that there may be other licensed mental health 
professionals serving on the interdisciplinary team that could be 
appropriate to coordinate the client's care. Therefore, we have amended 
the language at Sec.  485.916(a)(2) to allow the CMHC to determine 
(based on the findings of the client's comprehensive assessment) which 
appropriate licensed mental health professional(s) on the client's 
interdisciplinary team should coordinate care and treatment decisions 
with each client. This coordinator role would work to ensure that each 
client's needs are assessed and to ensure that the active treatment 
plan is implemented as indicated.
    Comment: A few commenters stated that social workers and 
occupational therapists are not needed for every client, but should be 
available.
    Response: Services offered to a client should be based on the 
client's assessed needs. If a client is assessed to need the services 
of a social worker and/or an occupational therapist, we would expect 
those disciplines to be part of the interdisciplinary team. We note 
that the needs of CMHC clients vary from clients receiving PHP to 
clients receiving short term counseling. Therefore, the proposed 
approach to the interdisciplinary team membership may not serve the 
client's interests and potentially takes away from the CMHC's 
flexibility to serve the client's needs. Therefore, we have amended the 
language at Sec.  485.916(a)(2) to allow for the CMHC to determine 
(based on the findings of the client's comprehensive assessment) the 
appropriate licensed mental health professional(s) and other CMHC staff 
that will serve on the client's interdisciplinary team.
    Comment: One commenter stated that a Licensed Professional 
Counselor (LPC) can fulfill the clinical, psychological, and social 
work needs of clients.
    Response: We appreciate the comment regarding LPCs fulfilling 
multiple client needs. We agree there are times when an LPC may be able 
to meet several different assessed needs of the client, as long as the 
State licensure permits them to do so. We would expect to see 
documentation by the LPC of the progress toward the client's goals. The 
expectation is that if goals are not being met and additional needs are 
assessed, the interdisciplinary team will bring in additional team 
members to address the client's needs.
    Comment: One commenter stated that a peer specialist or family peer 
advocate should be added to the IDT. Another commenter stated that CMS 
should require support of the recovery model by allowing for peers 
(persons with lived experience of mental illness, or peer specialists) 
to be part of the treatment team.
    Response: We appreciate the comments regarding peer specialists and 
family peer advocates. We agree that, depending on the CMHC's client 
needs and programs, peer specialists or family peer advocates may be 
appropriate to meet individual client needs. Therefore, we have amended 
the language at Sec.  485.916(a)(2)(vii) to permit other CMHC staff or 
volunteers to serve on the interdisciplinary team, as necessary.
    Comment: A few commenters stated that the timeframe for developing 
the active treatment plan should be extended from 3 working days to 5 
working days.
    Response: We appreciate the commenters' request for extension of 
the active treatment plan timeframe. We believe that completing the 
assessment in a timely manner is very important. In this final rule, we 
have amended the timeframe of the comprehensive assessment to be 
completed within 4 working days. Therefore, we also amended the 
language at Sec.  485.916(b) to extend the timeframe for completion of 
the active treatment plan to 7 working days.
    In the instances of partial hospitalization, due to the acuity 
level of the clients served, we expect the partial hospitalization 
program to meet the requirement at Sec.  424.24.
    Comment: A few commenters recommended amending the treatment plan 
language to allow organizations to document the understanding of either 
the individual served or, if the individual served is unable to 
acknowledge his or her understanding and/or agreement, the 
representative's understanding of, and agreement with, the treatment 
plan.
    Response: We appreciate the commenters' suggestion. We agree that 
having the CMHC document the client's and/or the client 
representative's understanding of the active treatment plan is 
necessary. We would expect the CMHC to document the client's 
understanding and involvement in his or her active treatment plan. If 
the client is unable to understand the active treatment plan, the CMHC 
would document the client's representative's understanding and 
involvement in the active treatment plan. Therefore, we

[[Page 64617]]

have amended the language in Sec.  485.916(c)(7).
    Comment: A few commenters stated that we should include the 
individual's preferences and personal goals in the active treatment 
plan. Another commenter recommended that we revise the standards to 
reflect current recovery-focused care planning to better align with the 
recommendations previously set forth by the Substance Abuse and Mental 
Health Services Administration.
    Response: We appreciate both commenters' suggestions to include the 
client's preferences and personal goals in the active treatment plan 
and to have a recovery focused active treatment plan. We agree with 
both of the commenters, and have amended Sec.  485.916(b) accordingly. 
We expect that the interdisciplinary team will work together to 
establish the client's individual active treatment plan in accordance 
with the client's recovery goals and preferences.
    Comment: One commenter recommended that we require the development 
of a crisis plan for each client.
    Response: We agree with the commenter that crisis planning is 
important for the health and safety of clients. However, the individual 
client's risk factors are assessed during the comprehensive assessment 
and the information gathered in the assessment and active treatment 
plan would be used to guide the care of the client if an emergency 
should occur. Therefore, we do not believe it is necessary to add an 
additional regulatory requirement addressing crisis planning.
CoP: Quality Assessment and Performance Improvement (Proposed Sec.  
485.917)
    We proposed to add a new CoP at Sec.  485.917 to specify the 
requirements for a quality assessment and performance improvement 
program (QAPI). The proposed QAPI CoP was divided into five standards.
    At Sec.  485.917(a), ``Standard: Program scope,'' we proposed that 
a CMHC QAPI would include, but not be limited to, an ongoing program 
that is able to show measureable improvement in indicators linked to 
improving client care outcomes and behavioral health support services. 
We expect that a CMHC would use standards of care and the findings made 
available in current literature to select indicators to monitor its 
program. The CMHC would have to measure, analyze, and track quality 
indicators, including areas such as adverse client events and other 
aspects of performance that assess processes of care, CMHC services and 
operations. The term ``adverse client events,'' as used in the field, 
refers to occurrences that are harmful or contrary to the targeted 
client outcomes, including sentinel events such as an unexpected 
occurrence involving death or serious injury. The use of restraint or 
seclusion is contrary to targeted client outcomes; therefore, we would 
consider the use of restraint or seclusion to be an adverse client 
event that would be tracked and analyzed as part of the QAPI program.
    At Sec.  485.917(b), ``Standard: Program data,'' we proposed to 
require the CMHC to incorporate quality indicator data, including 
client care data and other relevant data, into its QAPI program. A 
fundamental barrier in identifying quality care is lack of measurement 
tools. Measurement tools can identify opportunities for improving 
medical care and examining the impact of interventions.
    We did not propose to require CMHCs to use any particular process, 
tools or quality measures. However, a CMHC that uses available quality 
measures could expect an enhanced degree of insight into the quality of 
its services and client satisfaction.
    The CMHC could also develop its own data elements and measurement 
process as part of its program. A CMHC would be free to develop a 
program that meets its needs. We recognize the diversity of provider 
needs and concerns with respect to QAPI programs. As such, a provider's 
QAPI program would not be judged against a specific model. We expect 
the CMHC to develop and implement a continuous QAPI program that 
stimulates the CMHC to constantly monitor and improve its own 
performance, and to be responsive to the needs and satisfaction levels 
of the clients it serves.
    At Sec.  485.917(b), we proposed to require that data collected by 
the CMHC, regardless of the source of the data elements, would be 
collected in accordance with the detail and frequency specifications 
established by the CMHC's governing body. Once collected, the CMHC 
would use the data to monitor the effectiveness and safety of services, 
and target areas for improvement. The main goal of the proposed 
standard would be to identify and correct ineffective and/or unsafe 
care. We expect CMHCs to assess their potential client load and 
identify circumstances that could lead to significant client care 
issues, and concentrate their energies in these areas.
    At Sec.  485.917(c), ``Standard: Program activities,'' we proposed 
to require the CMHC to set priorities for its performance improvement 
activities that focus on high risk, high volume or problem-prone areas; 
consider the prevalence and severity of identified problems; and give 
priority to improvement activities that affect client safety, and 
quality of client outcomes. We expect that a CMHC would take immediate 
action to correct any identified problems that would directly or 
potentially threaten the care and safety of clients. Prioritizing areas 
of improvement is essential for the CMHC to gain a strategic view of 
its operating environment and to ensure consistent quality of care over 
time.
    We also proposed to require the CMHC to track adverse client 
events, analyze their causes, and implement preventive actions that 
include feedback and learning throughout the CMHC. In implementing its 
QAPI program, a CMHC is expected to treat staff and clients/
representatives as full partners in quality improvement. Staff members 
and clients/representatives are in a unique position to provide the 
CMHC with structured feedback on, and suggestions for, improving the 
CMHC's performance. We expect the CMHC to demonstrate how the staff and 
clients have contributed to its quality improvement program.
    At Sec.  485.917(d), ``Standard: Performance improvement 
projects,'' we proposed to require that the number and scope of 
improvement projects conducted annually would reflect the scope, 
complexity and past performance of the CMHC's services and operations. 
The CMHC would document what improvement projects were being conducted, 
the reasons for conducting them and the measurable progress achieved by 
them.
    At Sec.  485.917(e), ``Standard: Executive responsibilities,'' we 
proposed to require that the CMHC's governing body would be responsible 
and accountable for ensuring that the ongoing quality improvement 
program is defined, implemented, maintained, and evaluated annually. 
The governing body would ensure that the program addressed priorities 
for improved quality of care and client safety. The governing body 
would also have to specify the frequency and level of detail of the 
data collection and ensure that all quality improvement actions were 
evaluated for effectiveness. The governing body's most important role 
would be to ensure that staff was furnishing, and clients were 
receiving, safe, effective, quality care. Therefore, it would be 
incumbent on the governing body to lend its full support to agency 
quality improvement and performance improvement efforts.
    Comment: One commenter suggested that as an alternative to the 
requirement

[[Page 64618]]

that CMHCs develop their own QAPI programs, CMS could point CMHCs to 
specific, existing programs, such as NCQA's Managed Behavioral Health 
Organization (MBHO) Certification program, to ensure consistency among 
facilities in delivering high quality care.
    Response: We acknowledge that there are existing programs that may 
be used by CMHCs in their efforts to meet the QAPI standards. We would 
caution, however, that participation in such programs does not 
guarantee that the CMHCs are in compliance with this requirement. As 
required in Sec.  485.917(b)(2)(ii), CMHCs must use the quality 
indicator data that they have gathered to identify and prioritize 
opportunities for improvement. In addition, Sec.  485.917(a)(1) 
requires the CMHC QAPI program to show measurable improvement in the 
areas related to improved behavioral health outcomes and CMHC services 
specific to the individual facility. Furthermore, Sec.  485.917(d)(1) 
requires that the scope and number of a CMHC's performance improvement 
projects are to be based on the unique needs of the CMHC and its client 
population. These requirements require the CMHC to develop, implement, 
and assess performance improvement projects that reflect the areas of 
weakness, as identified through the data they have collected, and the 
needs of their organization. If a CMHC participates in a certification 
program that does not address one more of the areas of weakness, or if 
that performance improvement project will not enable the CMHC to 
demonstrate measurable improvement in areas identified as needing to be 
addressed, then participation in a certification program alone would 
not meet the QAPI requirements in this rule.
    CMHCs utilizing resources from a quality improvement organization 
will still be expected to provide separate documentation evidencing 
their QAPI program.
    Comment: Several commenters stated their strong support for the 
proposed rule regarding QAPI. According to the commenters, the 
existence of a QAPI program ensures the provision of quality services, 
identifies weaknesses in the care process, and encourages the provider 
to make changes in order to improve their current practices. A few 
commenters stated that they were committed to supporting CMHCs in 
developing better data systems and using that data to improve service 
quality and efficiency.
    Response: We appreciate the overall support for the data collection 
and QAPI requirements, as this support will help ensure that CMHCs 
develop a data-driven program for continuous quality improvement that 
reflects the needs of the clients and CMHCs alike.
    Comment: Several commenters supported CMS' decision to work with 
the NCQA and Mathematica to develop measures for use in inpatient 
psychiatric facilities, and requested that CMS facilitate the 
development and adoption of robust, harmonized, tested, and validated 
measures around schizophrenia that could also be used in other 
settings, such as CMHCs. In addition, the commenters encouraged further 
development of functional measures, such as the ability to return to 
work, that could be used as important indicators of successful 
treatment, especially for those clients with negative symptoms such as 
delusional behavior. The commenters stated that such measures would 
provide CMHCs with an important tool for use in evaluating their own 
quality programs.
    Response: We appreciate the support for CMS' work with the NCQA. At 
this time there are no plans for CMS to develop measures specific to 
CMHCs. However as CMS works with NCQA and the Substance Abuse and 
Mental Health Services Administration (SAMHSA), we will continue to 
pursue measures appropriate for the CMHC setting. CMHCs can use the 
search term ``mental health'' on the National Quality Forum Web site at 
http://www.qualityforum.org/Qps/QpsTool.aspx to find additional 
measures-related resources.
    Comment: Several commenters strongly agree that CMHCs should track 
``adverse client events'' and immediately ``correct any identified 
problems that would directly or potentially threaten the care and 
safety of clients.'' Commenters stated that all existing CMHCs should 
not have any issues complying with this requirement.
    Response: We appreciate the support for tracking adverse events. We 
believe it is essential to the CMHC QAPI program to begin tracking and 
analyzing adverse events at the same time it begins collecting client 
level outcomes measures data elements and CMHC-wide measures that are 
available. Adverse events generally result in harm to a client; they 
serve as important indicators for areas of potential improvement. If 
CMHCs do not collect adverse event information, they may be missing 
important data from which to assess their performance.
CMHC CoP: Organization, Governance, Administration of Services, and 
Partial Hospitalization Services (Sec.  485.918)
    We proposed to add a new CoP at Sec.  485.918, to set out the 
CMHC's administrative and governance structure and to clarify 
performance expectations for the governing body. As explained in the 
proposed rule, the overall goal of this CoP is to ensure that the 
management structure is organized and accountable. The proposed CoP was 
divided into seven standards.
    In the proposed organization and administration of services CoP, we 
proposed to list the services that the statute (section 1861(ff)(3) of 
the Act) requires CMHCs to furnish. We also proposed a standard that 
would require a CMHC to provide in-service training to all employees 
and staff, including those under contract or under arrangements, who 
have client contact. This requirement would assist in ensuring that all 
staff serving CMHC clients was up to date on current standards of 
practice. The CMHC would be required to have written policies and 
procedures describing its methods for assessing staff skills and 
competency, and to maintain a written description of in-service 
training offered during the previous 12 months.
    At Sec.  485.918(a), ``Standard: Governing body and 
administrator,'' we proposed to emphasize the responsibility of the 
CMHC governing body (or designated persons so functioning) for managing 
all CMHC facilities and services, including fiscal operations, quality 
improvement, and the appointment of the administrator. The 
administrator would be responsible for the day-to-day operation of the 
CMHC and would report to the governing body. The administrator would 
have to be a CMHC employee, and meet the education and experience 
requirements established by the CMHC's governing body. The specifics of 
the administration of the CMHC would be left to the discretion of the 
governing body, thereby affording the CMHC's management with 
organizational flexibility. The proposed governing body standard 
reflects our goal of promoting the effective management and 
administration of the CMHC as an organizational entity without 
dictating prescriptive requirements for how a CMHC must meet that goal.
    At Sec.  485.918(b), ``Provision of services,'' we proposed to 
specify a comprehensive list of services that a CMHC would be required 
to provide. At Sec.  485.918(b)(1)(v), we proposed to require the CMHC 
to provide at least 40 percent of its services to individuals who are 
not eligible for benefits under title XVIII of the Act (Medicare). This 
proposed requirement would track the changes to Sec.  410.2 set out in 
the November 24, 2010 Outpatient Prospective Payment System (OPPS)

[[Page 64619]]

final rule (75 FR 71800, 72259). Both the CMHC proposed rule and the 
OPPS final rule changes implement the statutory changes made by section 
1301(a) of the Health Care and Education Reconciliation Act of 2010 
(Pub. L. 111-152) (HCERA).
    Enactment of section 1301(a) of HCERA revised the definition of a 
CMHC set forth at section 1861(ff)(3)(B) of the Act by adding a 
provision to the existing requirements for CMHCs, effective on the 
first day of the first calendar quarter that began at least 12 months 
after the date of enactment (that is, April 1, 2011). As of that date, 
a Medicare-participating CMHC must provide at least 40 percent of its 
services to individuals who are not eligible for benefits under 
Medicare.
    We proposed to measure whether a CMHC is providing at least 40 
percent of its services to individuals who are not eligible for 
Medicare benefits by the amount of reimbursement for all services 
furnished. Additionally, we proposed to measure the 40 percent of its 
services on an annual basis. We solicited public comments on whether we 
should determine if a CMHC meets the 40 percent requirement annually or 
at some other interval. We also solicited comments on both the 
definition of terms used in any approach to measuring the 40 percent 
threshold and the data sources for that measurement. Specifically, 
since the measure proposed to determine the 40 percent threshold was 
total reimbursement from all payers, for all services provided, we were 
interested in comments on how we should define reimbursement.
    We also requested feedback on whether the proposed calculation 
should include uncompensated care or any other aspect of reimbursement, 
and on whether CMS should require the CMHCs to attest to whether they 
meet the 40 percent requirement, or whether we should subject them to 
verification auditing.
    Furthermore, we stated our interest in receiving comments on any 
other approaches that could constitute a measure of the 40 percent 
threshold. We stressed that we were concerned that the implementation 
of this provision not negatively impact access to care.
    Medicare-certified CMHCs are already required to provide most of 
the services set out in the proposed provision of services standard 
through the existing CMS payment rules (42 CFR 410.2, Sec.  410.110, 
and Sec.  424.24(e)). It is essential for CMHCs to have sufficient 
numbers of appropriately educated and trained staff to meet these 
service expectations. For example, CMHCs that provide partial 
hospitalization services could provide the services of ``other staff 
trained to work with psychiatric clients'' (42 CFR 410.43(a)(3)(iii)). 
Non-specified staff might be responsible for supervising clients and 
ensuring a safe environment. CMHCs would be expected to have a 
sufficient number of appropriately-trained staff to meet these 
responsibilities at all times.
    At Sec.  485.918(c), ``Standard: Professional management 
responsibility,'' we proposed to require that where services are 
furnished by other than CMHC staff, a CMHC would have to have a written 
agreement with another agency, individual, or organization that 
furnishes the services. Under this agreement, the CMHC would retain 
administrative and financial management and oversight of staff and 
services for all arranged services. The CMHC would have to have a 
written agreement that specified that all services would have to be 
authorized by the CMHC, be furnished in a safe and effective manner, 
and be delivered in accordance with established professional standards, 
the policies of the CMHC and the client's active treatment plan. As 
part of retaining financial management responsibility, the CMHC would 
retain all payment responsibility for services furnished under 
arrangement on its behalf.
    At Sec.  485.918(d), ``Standard: Staff training,'' which would 
apply to all employees, staff under contract, and volunteers, we 
proposed to require a CMHC to take steps to develop appropriate in-
service programs, including initial orientation for each new employee 
or volunteer furnishing services. The new employee orientation would 
address specific job duties. The CMHC could also provide staff training 
under arrangement.
    We would not require a specific staff in-service training program; 
rather, we would expect each CMHC to determine the scope of its own 
program, including the manner in which it chose to deliver the 
training, assess competence levels, determine training content, 
determine the duration and frequency of training for all employees, and 
track the training on a yearly basis.
    At Sec.  485.918(e)(1), ``Standard: Environmental conditions,'' and 
(e)(2), ``Building,'' we proposed to require the CMHC to provide 
services in an environment that is safe, functional, sanitary, 
comfortable, and in compliance with all Federal, State, and local 
health and safety standards, as well as State health care occupancy 
regulations. We indicated that these proposed requirements would help 
to ensure that CMHC services are provided in a physical location that 
is both safe and conducive to meeting the needs of CMHC clients.
    At Sec.  485.918(e)(3), ''Infection control,'' we proposed to 
address the seriousness and potential hazards of infectious and 
communicable diseases. We would require a CMHC to develop policies, 
procedures, and monitoring, as well as take specific actions to address 
the prevention and control of infections and disease.
    We believe that a CMHC should follow nationally accepted infection 
control standards of practice and ensure that all staff know and use 
current best preventive practices. Periodic training is one way to 
assure staff understanding, and we would expect the CMHC to establish a 
method to ensure that all staff receives appropriate training. Where 
infection and/or communicable diseases are identified, we would expect 
actions be taken to protect all the clients and staff.
    At Sec.  485.918(e)(4), ``Therapy sessions,'' we proposed that the 
CMHCs ensure that all individual and group therapy sessions be 
conducted in a manner that maintains client privacy and dignity. We 
believe that a safe, private environment would enhance the 
effectiveness of the therapy sessions.
    At Sec.  485.918(f), ``Standard: Partial hospitalization 
services,'' we proposed that all partial hospitalization services would 
be required to meet all applicable requirements of 42 CFR parts 410 and 
424.
    At Sec.  485.918(g), ``Standard: Compliance with Federal, State, 
and local laws and regulations related to the health and safety of 
clients,'' we proposed that the CMHC and its staff be required to 
operate and furnish services in compliance with all applicable Federal, 
State, and local laws and regulations related to the health and safety 
of clients. If State or local law provided for licensing of CMHCs, the 
CMHC would have to be licensed. In addition, the CMHC staff would have 
to follow the CMHC's policies and procedures.
    Comment: Many commenters strongly agree with the overall goal of 
the administrative standard at Sec.  485.918(a). They believe it would 
ensure that the management structure is organized and accountable.
    Response: We appreciate the overall support for the administrative 
standard. This support would help ensure efficient operation of the 
CMHC and that the CMHC meets the needs of the clients and CMHCs alike.
    Comment: Some commenters strongly support the option of allowing 
the CMHCs to receive oversight from the Joint Commission, or other 
accrediting

[[Page 64620]]

bodies. Other commenters encouraged CMS to defer to the states 
regarding deemed status, by recognizing deeming authority for CMHCs in 
those states that allow deeming. However, some commenters stated that 
CMS should not adopt deeming authority for CMHCs.
    Response: We appreciate the wide array of comments related to 
deeming. As stated in the proposed rule, we are not proposing to amend 
our regulations at Sec.  488.6 to grant deeming authority for CMHCs to 
accrediting organizations. CMS's regulation at Sec.  488.6 does not 
permit deeming for CMHCs. To allow for deeming authority to occur for 
CMHCs, there would need to be a regulatory change. We will take this 
under advisement for future rulemaking.
    Comment: Many commenters stated that CMS should use the language in 
Section 1301 of HCERA to calculate the 40 percent threshold. 
Specifically, they noted that the Congress used the phrase ``40 percent 
of its services to individuals'' without making any reference at all to 
reimbursement or payment in the statute. Commenters also stated that to 
be consistent with the major themes of the Affordable Care Act (which 
incorporates HCERA), the legislative language in Section 1301 of HCERA 
indicates the need for a patient-centric approach rather than a 
reimbursement-based approach. Additionally, many commenters stated that 
using an independent auditing agency to review CMHC financial 
statements to certify compliance with the 40 percent threshold would be 
overly burdensome and confusing for the CMHC.
    Response: We agree with the commenters on the 40 percent 
calculation. We proposed several different potential ideas for 
calculating the 40 percent. After carefully considering all the 
comments received, we are adopting a patient-centric approach and will 
require that the calculation of 40 percent be based on CMHC services to 
individuals.
    Comment: Commenters offered very detailed recommendations on how to 
calculate the 40 percent threshold, the implementation process, the 
timeframes, and the consequences if the CMHC does not meet the 40 
percent threshold. Also, commenters stated that the calculation to 
determine the 40 percent threshold should be based on a patient-centric 
methodology, including the following elements:
     Numerator: The numerator would include an unduplicated 
census of individuals who rely solely on health care coverage provided 
through private sector insurance or public health programs other than 
Medicare, indigent individuals and any other uninsured or inadequately 
insured individuals who receive behavioral health services from the 
CMHC.
     Denominator: The denominator would include an unduplicated 
census for all clients who receive services from the CMHC.
     Validation: For each reporting period, the CMHC could 
attest to the accuracy of the numbers reported to CMS for the patient-
centric numerator and denominator identified above. Medicare providers 
are required to prepare attestations in other contexts involving 
eligibility to receive Medicare reimbursement, including, but not 
limited to, the attestations used in the calculation of bad debt.
     Annual Reporting Period: Adopt an annual reporting period 
based on a facility's cost reporting year.
     Failure to Meet Performance Level: Providers that fail to 
meet the 40 percent threshold by more than five percent during a 
particular year should be placed on probation for 12 months and 
required to develop and implement a corrective action plan to bring the 
facility into compliance with the 40 percent requirement. If a facility 
fails to meet the threshold for a second consecutive year, that CMHC 
should be rendered ineligible for Medicare reimbursement during the 
subsequent year.
    Response: We agree with the commenters' recommendations for 
calculating the 40 percent threshold. Therefore, we amended the 
proposed Sec.  485.918 (b)(1)(v) to read ``provides at least 40 percent 
of its items and services to individuals who are not eligible for 
benefits under title XVIII of the Act.'' We have removed the subsequent 
phrase, which read ``as measured by the total revenues received by the 
CMHC that are payments from Medicare versus payers other than 
Medicare.'' We agree that the numerator should include an unduplicated 
census of individuals who receive services not paid for in whole or in 
part by Medicare. This may include individuals who rely solely on 
health care coverage provided through private sector insurance or 
public health programs other than Medicare, or whose insurance doesn't 
cover the behavioral health services they receive from the CMHC. The 
denominator would consist of an unduplicated census of all clients who 
receive services from the CMHC, including Medicare beneficiaries. The 
calculation will determine the total percentage of individuals who are 
not eligible for benefits under title XVIII of the Act. The CMHC needs 
to assure continued compliance with the 40 percent threshold on an 
annual basis--that is, 40 percent of the clients served by the CMHC 
during each intervening 12 month period must be individuals for whom 
services are not paid for by Medicare.
    We will not be using the proposed language on reimbursement or cost 
report information to calculate the 40 percent. Rather, we will require 
all CMHCs to verify their compliance with the 40 percent requirement by 
sending documentation to the appropriate Part A/Part B Medicare 
Administrative Contractor (A/B MAC) from an independent entity such as 
an accounting technician, which will certify that it has reviewed the 
client care data for the CMHC. The documentation must be sent upon 
initial application for Medicare provider status, and upon 
revalidation, including off cycle revalidation, thereafter to the 
relevant A/B MAC (see revalidation requirements at Sec.  424.515). The 
documentation must state whether the CMHC met or did not meet the 40 
percent requirement for the prior 3 months (in the case of the initial 
application) or for each of the intervening 12 month periods between 
initial enrollment and revalidation. If the CMHC did not meet the 40 
percent threshold, the A/B MAC will notify the CMHC that they have 30 
days to correct the issue or their Medicare enrollment and billing 
privileges will be denied for non-compliance (see Sec.  424.530(a)(1)) 
or revoked for non-compliance (see Sec.  424.535(a)(1)).
    If an A/B MAC denies or revokes a CMHC's Medicare billing 
privileges, the CMHC is afforded provider enrollment appeal rights, and 
may reapply or seek reinstatement into the Medicare program subject to 
the provisions found in Sec.  424.535.
    We appreciate the commenters' suggestions related to failure to 
meet the 40 percent threshold. However, we disagree with the proposed 
probationary period and the suggestion of a 5 percent margin. The law 
does not allow for a probationary period or margins. This final rule 
becomes effective one year after publication of this rule in the 
Federal Register. This means all CMHCs will have one year to implement 
the provisions of this rule before the independent entity audit or a 
survey would occur.

[[Page 64621]]

    Comment: Several commenters stated that volunteers should not be 
included in the staff education component described by Sec.  
485.918(d)(1) and recommended that any reference to volunteers in this 
section be removed.
    Response: We appreciate the commenters' opinions. However, we 
believe that educating volunteers about CMHC care and services and 
person-centered planning is just as important for the volunteer as it 
is for the staff member. Volunteers are asked to interact with clients 
in many different situations, such as the waiting room and reception 
area. For the safety of the client and the volunteer, volunteers should 
have a basic understanding of the types of clients served and the 
workings within the CMHC.
    Comment: A few commenters stated that Sec.  485.918(d)(3) requires 
that CMHCs ``assess the skills and competence of all individuals 
furnishing care[hellip].'' They stated that it is not clear what such a 
skills and competency assessment would contain, and how much time it 
would take to develop and administer such assessments for each position 
within every CMHC. Commenters suggested that this requirement would be 
met by QAPI. Other commenters suggested that the requirement for CMHC 
staff to receive consistent and ongoing continuing education is best 
enforced through the personnel requirements. Commenters stated that 
licensure and credentialing laws typically include requirements for 
ongoing continuing education. Other commenters stated that while in-
service training may be appropriate in some circumstances, CMS should 
recognize and support existing continuing education practices required 
for practitioner licensure and certification.
    Response: To clarify, we are requiring the CMHC to create policies 
and procedures by which to evaluate their employees relevant to the 
duties assigned to each employee, which can be tied to the CMHC 
policies related to personnel requirements. The specifics of these 
policies and procedures would be up to each individual CMHC. The 
commenters are correct that this could also be part of the QAPI 
program. If an area of concern is recognized by staff administering the 
QAPI program, or the CMHC administration, then it is expected that the 
CMHC would conduct in-service training related to the area of concern. 
We understand that there may be specific individual provider licensure 
requirements based on State laws and regulations; however, this would 
be specific to the provider type, such as nurse or therapist to 
maintain his or her license or certification. Section 485.918(d)(3) is 
specifically related to overall training of the CMHC staff, whether it 
is specific to issues brought up through the QAPI program or new or 
edited policies and/or procedures within the CMHC. In-service training 
can also be used to meet other State and/or Federal requirements, such 
as infection control.
    Comment: A few commenters stated that assessing for self-harm is 
not enough. Commenters stated that CMHCs need to educate and train 
staff on suicide prevention. Commenters believe that these regulations 
could help address a well-established training deficit among service 
providers and their organizations and could reduce consumer suicide-
related morbidity and mortality. Commenters also stated that if staff 
are untrained and cannot demonstrate competency in the clinical 
assessment of suicide risk, clients may be at risk.
    Response: We agree with the commenter that the importance of 
suicide prevention education is critical to all staff within the CMHC. 
Therefore, we have modified the language at Sec.  485.914(b)(4)(ix) to 
read: ``Factors affecting client safety or the safety of others, 
including behavioral and physical factors as well as suicide risk 
factors.'' This is an example of where the use of in-service training 
in Sec.  485.918(c)(3) would benefit the entire CMHC staff and meet the 
in-service training requirements. It is very important that CMHCs 
follow current standards of practice and continually monitor and 
educate their staff as it relates to current standards of practice such 
as suicide prevention.

III. 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 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 (PRA) 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 published a proposed rule in the Federal Register (76 FR 35684) 
on June 17, 2011. The comment period closed on August 16, 2011. We did 
not receive any comments related to the PRA section of this rule.
    We have made several assumptions and estimates in order to assess 
the time that it will take for a CMHC to comply with the provisions and 
the associated costs of compliance. CMHC client data from outside 
sources are limited; therefore, our estimates are based on available 
Medicare data. We have detailed these assumptions and estimates in 
Table 1 below. We have also detailed many of the standards within each 
CoP, and have noted whether or not there is an impact for each in the 
section below. However, the requirements contained in many of the CoPs 
are already standard medical or business practices and, as a result, do 
not pose an additional burden on CMHCs.

[[Page 64622]]



  Table 1--Assumptions and Estimates Used Throughout the Collection of
                Information and Impact Analysis Sections
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Number of Medicare CMHCs nationwide (Based on CY 2012                100
 CMS data)............................................
Number of CMHC clients nationwide * (Estimate based on            22,700
 CY 2010 data)........................................
Number of clients per average CMHC....................               227
Hourly rate of psychiatric nurse......................               $47
Hourly rate of clinical psychologist..................               $54
Hourly rate of administrator..........................               $66
Hourly rate of clinical social worker.................               $35
Hourly rate of mental health counselor................               $31
Hourly rate of auditing or accounting clerk...........               $24
------------------------------------------------------------------------
* Reflects 13,600 Medicare clients and 9,100 non-Medicare clients.
Note: All salary estimates include benefits and overhead package worth
  48 percent of the base salary. Salary estimates were obtained from
  http://www.bls.gov/.

A. ICRs Related to Condition of Participation: Client Rights (Sec.  
485.910)

    Section 485.910(a) requires that the CMHC develop a notice of 
rights statement to be provided to each client. We estimate that it 
will require 8 hours on a one-time basis to develop this notice, and 
the CMHC administrator would be responsible for this task, at a cost of 
$528 per CMHC and $52,800 for all CMHCs nationwide. In addition, this 
standard requires that the CMHC obtain the client's and client 
representative's (if appropriate) signature confirming that he or she 
has received a copy of the notice of rights and responsibilities. The 
CMHC will have to retain the signed documentation showing that it 
complied with the requirements, and that the client and the client's 
representative demonstrated an understanding of these rights. We 
estimate that the time it will take for the CMHC to document the 
information will be 2.5 minutes per client or approximately 9.47 hours 
per CMHC. At an average of 2.5 minutes (.0417 hours) per client to 
complete both tasks, we estimate that all CMHCs will use 947 hours to 
comply with this requirement (.0417 hours per client x 22,700 clients). 
The estimated cost associated with these requirements is $44,509, based 
on a psychiatric nurse performing this function (947 hours x $47 per 
hour).
    We note that we do not impose any new language translation or 
interpretation requirements. Under Title VI of the Civil Rights Act of 
1964, recipients of federal financial assistance, such as CMHCs, have 
long been prohibited from discriminating on the basis of race, color, 
or national origin. Language interpretation is required under some 
circumstances under that statute and the HHS regulations at 45 CFR part 
80 (see previous discussion of Office for Civil Rights guidance issued 
in 2003). Because we impose no new requirements not already fully 
encompassed in that regulation and guidance, we have estimated no 
paperwork burden.
    Section 485.910(d)(2) requires a CMHC to document a client's or 
client representative's complaint of an alleged violation and the steps 
taken by the CMHC to resolve it. The burden associated with this 
requirement is the time it will take to document the necessary aspects 
of the issues. In late 2007, the American Association of Behavioral 
Health and The Joint Commission informed us that we could anticipate 52 
complaints per year per CMHC and that it will take the administrator 5 
minutes per complaint at the rate of $66/hr to document the complaint 
and resolution activities, for an annual total of 4.33 hours per CMHC 
or 433 hours for all CMHCs. The estimated cost associated with this 
requirement is $28,578.
    Section 485.910(d)(4) requires the CMHC to report within 5 working 
days of becoming aware of the violation, all confirmed violations to 
the state and local bodies having jurisdiction. We anticipate that it 
will take the administrator 5 minutes per complaint to report, for an 
annual total of 4.33 hours per CMHC or 433 hours for all CMHCs. The 
estimated cost associated with this requirement is $28,578.
    Section 485.910(e)(2) requires written orders for a physical 
restraint or seclusion, and Sec.  485.910(e)(4)(v) requires physical 
restraint or seclusion be supported by a documentation in the client's 
clinical record of the client's response or outcome. The burden 
associated with this requirement is the time and effort necessary to 
document the use of physical restraint or seclusion in the client's 
clinical record. We estimate that it will take 45 minutes per event for 
a nurse to document this information. Similarly, we estimate that there 
will be 1 occurrence of the use of physical restraint or seclusion per 
CMHC annually. The estimated annual burden associated with this 
requirement for all CMHCs is 75 hours. The estimated cost associated 
with this burden for all CMHCs is $3,525.
    Section 485.910(f) specifies restraint or seclusion staff training 
requirements. Specifically, Sec.  485.910(f)(1) requires that all 
client care staff working in the CMHC be trained and able to 
demonstrate competency in the application of restraints and 
implementation of seclusion, monitoring, assessment, and providing care 
for a client in restraint or seclusion, and on the use of alternative 
methods to restraint and seclusion. Section 485.910(f)(4) requires that 
a CMHC document in the personnel records that each employee 
successfully completed the restraint and seclusion training and 
demonstrated competency in the skill. We estimate that it will take 35 
minutes per CMHC to comply with these requirements. The estimated total 
annual burden associated with these requirements is 58 hours. The 
estimated cost associated with this requirement is $2,726.
    Section 485.910(g) requires the CMHC to report any death that 
occurred while a CMHC client was in restraint or seclusion in the CMHC 
while awaiting transfer to a hospital. We have a parallel requirement 
in all other CMS rules dealing with programs and providers where 
restraint or seclusion may be used (for example, in our hospital 
conditions of participation). Based on informal discussions with the 
CMHC industry and The Joint Commission, we believe restraints and 
seclusion are rarely, if ever, used in CMHCs, and that there are very 
few deaths (if any) that occur due to restraint or seclusion in a CMHC. 
Several commenters stated that the majority of CMHCs have a restraint 
or seclusion free policy. Therefore, restraint or seclusion is not 
permitted in these agencies. Hence, we believe the number of deaths 
associated with this requirement is estimated at zero. Under 5 CFR 
1320.3(c)(4), this requirement is not subject to the PRA as it would 
affect

[[Page 64623]]

fewer than 10 entities in a 12-month period.

B. ICRs Related to Condition of Participation: Admission, Initial 
Evaluation, Comprehensive Assessment, and Discharge or Transfer of the 
Client (Sec.  485.914)

    Section 485.914(b) through (e) requires each CMHC to conduct and 
document in writing an initial evaluation and a comprehensive client-
specific assessment; maintain documentation of the assessment and any 
updates; and coordinate the discharge or transfer of the client. The 
burden associated with these requirements is the time required to 
record the initial evaluation and comprehensive assessment, including 
changes and updates. We believe that documenting a client's initial 
evaluation and comprehensive assessment is a usual and customary 
business practice under 5 CFR 1320.3(b)(2) and, as such, the burden 
associated with it is exempt from the PRA.
    Section 485.914(e) requires that, if the client were transferred to 
another facility, the CMHC is required to forward a copy of the 
client's CMHC discharge summary and clinical record, if requested, to 
that facility. If a client is discharged from the CMHC because of 
noncompliance with the treatment plan or refusal of services from the 
CMHC, the CMHC is required to provide a copy of the client's discharge 
summary and clinical record, if requested, to the client's primary 
health care provider. The burden associated with this requirement is 
the time it takes to forward the discharge summary and clinical record, 
if requested. This requirement is considered to be a usual and 
customary business practice under 5 CFR 1320.3(b)(2) and, as such, the 
burden associated with it is exempt from the PRA.

C. ICRs Related to Condition of Participation: Treatment Team, Active 
Treatment Plan, and Coordination of Services (Sec.  485.916)

    Section 485.916(b) requires all CMHC care and services furnished to 
clients and their families to follow a written active treatment plan 
established by the interdisciplinary treatment team. The CMHC is 
required to ensure that each client and representative receives 
education provided by the CMHC, as appropriate, for the care and 
services identified in the active treatment plan.
    The provisions at Sec.  485.916(c) specify the minimum elements 
that the active treatment plan must include. In addition, in Sec.  
485.916(d), the interdisciplinary team is required to review, revise, 
and document the active treatment plan as frequently as the client's 
condition requires, but no less frequently than every 30 calendar days. 
A revised active treatment plan must include information from the 
client's updated comprehensive assessment, and must document the 
client's progress toward the outcomes specified in the active treatment 
plan. The burden associated with these requirements is the time it 
takes to document the active treatment plan (.1667 hours per client or 
approximately 3,784 hours nationally) estimated to be a total of $1,778 
per CMHC or $177,848 nationally. Additionally, we estimate any 
revisions to the active treatment plan (approximately 5 minutes) will 
cost $525 per CMHC or $88,877 nationally (1891 hours x $47/hour).
    Section 485.916(e) requires a CMHC to develop and maintain a system 
of communication and integration to ensure compliance with the 
requirements contained in Sec.  485.916(e)(1) through (e)(5). The 
burden associated with this requirement will be the time and effort 
required to develop and maintain the system of communication in 
accordance with the CMHC's policies and procedures. We believe that the 
requirement is usual and customary business practice under 5 CFR 
1320.3(b)(2) and, as such, the burden associated with it is exempt from 
the PRA.

D. ICRs Related to Condition of Participation: Quality Assessment and 
Performance Improvement (Sec.  485.917)

    Section 485.917 requires a CMHC to develop, implement, and maintain 
an effective ongoing CMHC-wide data driven quality assessment and 
performance improvement (QAPI) program. The CMHC is required to 
maintain and demonstrate evidence of its quality assessment and 
performance improvement program and be able to demonstrate its 
operation to CMS. The CMHC is required to take actions aimed at 
performance improvement and, after implementing those actions, must 
measure its success and track its performance to ensure that 
improvements were sustained. The CMHC is required to document what 
quality improvement projects were conducted, the reasons for conducting 
these projects, and the measurable progress achieved on these projects.
    The burden associated with these requirements is the time it takes 
to document the development of the quality assessment and performance 
improvement and associated activities. We estimate that it will take 
each CMHC administrator an average of 4 hours per year at the rate of 
$66/hr to comply with these requirements for a total of 400 hours 
annually. The estimated cost associated with this requirement is 
$26,400.

E. ICRs Related to Condition of Participation: Organization, 
Governance, Administration of Services, and Partial Hospitalization 
Services (Sec.  485.918)

    Section 485.918(b) lists care and services a Medicare CMHC must be 
primarily engaged in regardless of payer type. Specifically, Sec.  
485.918(b)(1)(v) requires the CMHC to provide at least 40 percent of 
its items and services to individuals who are not eligible for benefits 
under title XVIII of the Act as measured by the total number of CMHC 
clients treated by the CMHC and not paid for by Medicare, divided by 
the total number of clients treated by the CMHC. The burden associated 
with this requirement is the time it takes for an independent entity 
contracted by the CMHC to calculate compliance with the 40 percent 
requirement and create a letter for the CMHC to submit to CMS. We 
estimate it will take the independent entity an average of 5 hours per 
new CMHC applicant and 5 hours for each CMHC that is due for its every 
5 year revalidation to calculate compliance with the 40 percent 
requirement and create a letter to CMS. We estimate there will be 10 
new CMHC applicants per year for a total of 50 hours annually and an 
estimated cost of $1,200. We estimate there will be 20 CMHCs up for 
revalidation each year for a total of 100 hours for all CMHCs, with an 
estimated cost of $2,400. Therefore, the annual reporting for new CMHC 
applicants and CMHC revalidation is estimated at 150 hours with a total 
cost of $3,600.
    Section 485.918(c) lists the CMHC's professional management 
responsibilities. A CMHC could enter into a written agreement with 
another agency, individual, or organization to furnish any services 
under arrangement. The CMHC is required to retain administrative and 
financial management, and oversight of staff and services for all 
arranged services, to ensure the provision of quality care. The burden 
associated with this requirement is the time and effort necessary to 
develop, draft, execute, and maintain the written agreements. We 
believe these written agreements are part of the usual and customary 
business practices of CMHCs under 5 CFR 1320.3(b)(2) and, as such, the 
burden associated with them is exempt from the PRA.
    Section 485.918(d) describes the standard for training. In 
particular, Sec.  485.918(d)(2) requires a CMHC to

[[Page 64624]]

provide an initial orientation for each employee, contracted staff 
member, and volunteer that addresses the employee's or volunteer's 
specific job duties. Section 485.918(d)(3) requires a CMHC to have 
written policies and procedures describing its method(s) of assessing 
competency. In addition, the CMHC is required to maintain a written 
description of the in-service training provided during the previous 12 
months. These requirements are considered to be usual and customary 
business practices under 5 CFR 1320.3(b)(2) and, as such, the burden 
associated with them are exempt from the PRA.
    Section 485.918(e)(3) requires the CMHC to maintain policies, 
procedures, and monitoring of an infection control program for the 
prevention, control and investigation of infection and communicable 
diseases. The burden associated with this requirement is the time it 
takes to develop and maintain policies and procedures and document the 
monitoring of the infection control program. We believe this 
documentation is part of the usual and customary medical and business 
practices of CMHCs and, as such, is exempt from the PRA under 5 CFR 
1320.3(b)(2).
    Table 2 below summarizes the estimated reporting and recordkeeping 
burden for this final rule.

                                                 Table 2--Estimated Reporting and Recordkeeping Burdens
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                           Hourly       Total
                                                OMB                              Burden per     Total    labor cost  labor cost     Total
           Regulation section(s)              Control   Respondents   Responses   response     annual        of          of        capital/   Total cost
                                                No.                                (hours)     burden     reporting   reporting  maintenance      ($)
                                                                                               (hours)       ($)         ($)       costs ($)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Sec.   485.910(a)(1)......................    0938-New          100         100           8         800          66      52,800            0      52,800
Sec.   485.910(a)(3)......................    0938-New          100      22,700       .0417         947          47      44,509            0      44,509
Sec.   485.910(d)(2)......................    0938-New          100       5,200       .0833         433          66      28,578            0      28,578
Sec.   485.910(d)(4)......................    0938-New          100       5,200       .0833         433          66      28,578            0      28,578
Sec.   485.910(e)(4)(v)...................    0938-New          100         100         .75          75          47       3,525            0       3,525
Sec.   485.910(f)(4)......................    0938-New          100         700       .0833          58          47       2,726            0       2,726
Sec.   485.916(c).........................    0938-New          100      22,700       .1667        3784          47     177,848  ...........     177,848
Sec.   485.916(d).........................    0938-New          100      22,700       .0833        1891          47      88,877            0      88,877
Sec.   485.917............................    0938-New          100         100           4         400          66      26,400            0      26,400
Sec.   485.918(b).........................    0938-New           30          30           5         150          24       3,600            0       3,600
                                           -------------------------------------------------------------------------------------------------------------
    Total.................................  ..........          100      79,530     18.7083  ..........  ..........     457,441  ...........     457,441
--------------------------------------------------------------------------------------------------------------------------------------------------------

    If you comment on these information collection and recordkeeping 
requirements, please submit your comments to the Office of Information 
and Regulatory Affairs, Office of Management and Budget, Attention: CMS 
Desk Officer, [CMS-3202-F]; Fax: (202) 395-6974; or Email: [email protected].

IV. Regulatory Impact Analysis

A. Overall Impact

    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 
(January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19, 
1980, Pub. L. 96-354), section 1102(b) of the Social Security Act, 
section 202 of 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 Orders 12866 and 13563 direct 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). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. A regulatory impact analysis (RIA) must be prepared for 
major rules with economically significant effects ($100 million or more 
in any 1 year). The overall economic impact for all new CoPs in this 
final rule is estimated to be $3 million in the first year of 
implementation and $2.2 million annually thereafter. Therefore, this is 
not an economically significant or major final rule.
    The RFA requires agencies to analyze options for regulatory relief 
of small entities, 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 government 
agencies. Individuals and States are not included in the definition of 
a small entity. For purposes of the RFA, most CMHCs are considered to 
be small entities, either by virtue of their nonprofit or government 
status or by having revenues of less than $10 million in any one year 
(for details, see the Small Business Administration's Web site at 
http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf). We 
estimate there are approximately 100 CMHCs with average admissions of 
approximately 227 clients per CMHC.\1\
---------------------------------------------------------------------------

    \1\ In order to develop this estimate we divided the total 
number of Medicare beneficiaries who received partial 
hospitalization services in 2010 by the total number of Medicare-
participating CMHCs in 2010 to establish the average number of 
Medicare beneficiaries per CMHC. This resulted in 136 beneficiaries 
per CMHC. We then assumed that, in order to comply with the 40 
percent requirement, those 136 beneficiaries only accounted for 60 
percent of an average CMHC's total patient population. This meant 
that an average CMHC also treated another 91 clients who did not 
have Medicare as a payer source, for a total of 227 clients 
(Medicare + non-Medicare) in an average CMHC.
---------------------------------------------------------------------------

    We estimate that implementation of this rule will cost CMHCs 
approximately $3 million, or approximately $30,000 per average CMHC, in 
the first year of implementation and $2.2 million, or approximately 
$22,000 per average CMHC, after the first year of implementation and 
annually thereafter. Therefore, the Secretary has determined that this 
final rule will not have a significant impact on a substantial number 
of small entities, because the cost impact of this rule is less than 1 
percent of total CMHC Medicare revenue (approximately $218 million per 
year, as shown by CY 2010 claims data).
    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

[[Page 64625]]

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 and has fewer than 100 beds. We 
believe that this final rule will not have a significant impact on the 
operations of a substantial number of small rural hospitals since there 
are few CMHC programs in those facilities. Therefore, the Secretary has 
determined that this final rule will not have a significant impact on 
the operations of a substantial number 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 2013, that 
threshold is approximately $141 million. This final rule will not have 
an impact on the expenditures of State, local, or tribal governments in 
the aggregate, or on the private sector of $141 million.
    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 final rule has no Federalism implications.

B. Anticipated Effects on CMHCs

    We are establishing a new subpart J under the regulations at 42 CFR 
part 485 to incorporate the CoPs for CMHCs (which will be effective 12 
months after the publication of this final rule). The new subpart J 
includes the basis and scope of the subpart, definitions, and six 
conditions.
    Section III of this rule, Collection of Information Requirements, 
provides a detailed analysis of the burden hours and associated costs 
for all burdens related to the collection of information by CMHCs that 
are required by this rule. That section, in tandem with this regulatory 
impact analysis section, presents a full account of the burdens that 
are imposed by this rule. As shown above in table 2 the total cost of 
all information collection requirements in the first year is estimated 
to be $457,441. In addition, table 3 below presents the total first 
year cost of $2,596,809 for all other requirements. Therefore, the 
total cost for implementing all CoP requirements, including information 
collection and other costs that CMHCs must meet in order to participate 
in the Medicare program, is estimated to be $3 million in the first 
year of implementation and 2.2 million annually thereafter.

                                         Table 3--Total Estimates for All Requirements Described in This Section
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Total time (hours) per    Total industry time     Total cost per average
                                                            average CMHC               (hours)                    CMHC             Total industry cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Client rights.......................................         1st year: 167.47         1st year: 16,747        1st year: $10,968     1st year: $1,096,809
                                                                Annual: 67.47            Annual: 6,747           Annual: $3,449         Annual: $344,909
Treatment team. Active Treatment Plan, and                                265                   26,500                  $11,568               $1,156,800
 Coordination of Services...........................
Quality Assessment and Performance Improvement......                       20                    2,000                   $1,320                 $132,000
Organization, Governance, Administration of Services             1st year: 32          1st year: 3,200         1st year: $2,112       1st year: $211,200
                                                                   Annual: 24            Annual: 2,400           Annual: $1,584         Annual: $158,400
                                                     ---------------------------------------------------------------------------------------------------
    Totals..........................................         1st year: 484.47         1st year: 48,447        1st year: $25,968     1st year: $2,596,809
                                                               Annual: 376.47           Annual: 37,647          Annual: $17,921       Annual: $1,792,109
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Costs presented in this table do not include those accounted for in Section III. Collection of Information Requirements.

    We have detailed, below, many of the standards within each CoP, and 
have noted whether or not there is an impact for each. However, the 
requirements contained in many of the provisions are already standard 
medical or business practices. These requirements will, therefore, not 
pose additional burden to CMHCs because they are already standards of 
practice. Client Rights (Sec.  485.910)
    Section 485.910(a), ``Standard: Notice of rights and 
responsibilities,'' requires that during the initial evaluation, the 
CMHC must provide the client and the client's representative or 
surrogate (if appropriate) with verbal and written notice of the 
client's rights and responsibilities in a language and manner that the 
individual understands. Communicating with clients, and their 
representatives or surrogates, in a manner that meets their 
communication needs is a standard practice in the health care industry. 
Because we are implementing a requirement that is fully compatible with 
existing civil rights requirements and guidance, we believe that the 
requirement to communicate with clients in a manner that meets their 
communication needs will impose no additional costs.
    In addition, this standard requires a CMHC to provide each CMHC 
client and representative verbal and written notification of the CMHC 
client's rights. We estimate the burden for the time associated with 
providing the verbal notice will be 2.5 minutes (0.0417 hours) per 
client or approximately 9.47 hours per CMHC. We note that the burden 
associated with providing the written notice is discussed in the 
Collection of Information section of this rule. We estimate that all 
CMHCs will use 947 hours to comply with this requirement (0.0417 hours 
per client x 22,700 clients). The estimated cost associated with these 
requirements is $44,509, based on a psychiatric registered nurse 
performing this function (947 hours x $47 per hour).
    With respect to the CoP for client rights, the standard addressing 
violations of client rights requires a CMHC to investigate alleged 
client rights violations, and take corrective actions when necessary 
and appropriate. We estimate that the CMHC administrator will spend, on 
average, 25 minutes investigating each alleged client rights violation. 
For purposes of our analysis, we assume that an average CMHC will 
investigate 1 alleged violation per week, for a total of 22 hours 
annually, at a cost of $1,452

[[Page 64626]]

annually per CMHC. All CMHCs nationwide require 2,200 hours, with an 
average labor cost of $66 per hour for the administrator, the estimated 
nationwide cost of $145,200.
    In addition, we are implementing three standards under the CoP for 
client rights pertaining to restraint and seclusion, staff training 
requirements for restraints and seclusion, and death reporting 
requirements. These standards include requirements that guide the 
appropriate use of seclusion and restraint interventions in CMHCs, when 
necessary, to ensure the physical safety of the client and others while 
awaiting the client's transport to a hospital. They are adapted from 
the clients' rights CoP for hospitals published as a final rule in the 
Federal Register on December 8, 2006 (71 FR 71378), and codified at 
Sec.  482.13.
    We anticipate that CMHCs will be minimally impacted by these 
standards. Several public commenters stated that restraints and 
seclusion are never used in CMHCs and therefore are not needed in 
CMHCs. However, we are still estimating the burden to facilities for 
restraint and seclusion use. We do not have access to several key 
pieces of information to estimate the burden. For example, we do not 
have data on the volume of staff in CMHCs, or the varying levels and 
qualifications of CMHC staff that may use restraint and seclusion. 
Factors such as size of facility, services rendered, staffing, and 
client populations vary as well. We are hesitant to make impact 
estimates in this rule that may not account for these and other 
unforeseen variations. Below we discuss the anticipated effects on 
providers of the standards related to restraints and seclusion.
    The restraint and seclusion standards set forth the client's rights 
in the event that he or she is restrained or secluded, and sets limits 
on when and by whom restraint or seclusion can be implemented. We 
recognize that there will be some impact associated with performing 
client assessment and monitoring to ensure that seclusion or restraint 
is only used in a safe and effective manner, when necessary, to protect 
the client and others from immediate harm, pending transport to the 
hospital. However, client assessment and monitoring are standard 
components of client care, and this requirement does not pose a burden 
to a CMHC.
    The standards on staff training for restraint or seclusion that we 
are codifying at Sec.  485.910(f) set out the staff training 
requirements for all appropriate client care involving the use of 
seclusion and restraint in the CMHC. Training is important for the 
provision of safe and effective restraint or seclusion use. We require 
that before staff apply restraints, implement seclusion, perform 
associated monitoring and assessment of the restrained or secluded 
client, or provide care for a restrained or secluded client, the staff 
be trained and able to demonstrate competency in the performance of 
these actions. The staff training requirements will address the 
following broad areas: Training intervals, training content, trainer 
requirements, and training documentation.
    To reduce regulatory burden and create a reasonable requirement 
while assuring client safety, we are mandating that only those staff 
who would be involved in the application of restraint or seclusion or 
performing associated monitoring and assessment of, or providing care 
for, restrained or secluded clients would be required to have this 
training.
    In this final rule, we are finalizing broad topics to be covered in 
training, and are not requiring that staff be trained by an outside 
organization. We believe that in-house training could be more 
economical than sending staff off site for instruction. However, CMHCs 
will have the option of sending either selected or all staff to outside 
training if they believe this is warranted.
    Therefore, we have based our burden estimate on a CMHC nurse being 
trained by an outside organization (for example, the Crisis Prevention 
Institute) to provide such training. We believe that most CMHCs then 
will have this nurse function as a program developer and as a trainer 
of the appropriate CMHC staff. In addition, we believe in most 
instances this professional will be a psychiatric registered nurse.
    Train-the-trainer programs are the way many CMHCs provide staff 
instruction. For example, the 4-day instructor certification program 
given by the Crisis Prevention Institute (CPI, Inc.) costs $1,999 for 
tuition plus travel, lodging, and participant salary. More detailed 
information regarding the train-the-trainer programs can be found on 
CPI, Inc.'s Web site at http://www.crisisprevention.com.
    We estimate, on average, that the cost to train one nurse will 
include the following expenses: (1) Round trip travel at approximately 
$400 to cover the need for either local or distant travel; (2) lodging 
for 3 nights (at $120 per night) for approximately $360; and (3) meals 
and incidental expenses for 4 days (at $50 per day) for approximately 
$200, depending upon the location within the particular State. 
Therefore, we anticipate the cost to train one nurse is approximately 
$2,959 plus the nurse's total salary of $1,504 for 4 days (at $376 per 
day). The total estimated training cost for all CMHCs is approximately 
$446,300.
    We believe that CMHCs will add seclusion and restraint training 
onto their in-service training programs. The train-the-trainer program 
described above provides CMHCs with the necessary personnel and 
materials to implement a staff-wide seclusion and restraint training 
program. We estimate that developing this staff-wide training program 
requires 40 hours of the trainer's time on a one-time basis for all 
affected CMHCs, at a cost of $1,880 per CMHC.
    We are requiring that each individual who could potentially be 
involved in restraint and seclusion of a client have training in the 
proper techniques. According to the National Association of Psychiatric 
Health Systems (NAPHS), initial training in de-escalation techniques, 
restraint and seclusion policies and procedures, and restraint and 
seclusion techniques range from 7 to 16 hours of staff and instructor 
time.
    Due to a lack of data on the average number of employees in a CMHC, 
for purposes of this analysis only, we assume that an average CMHC will 
need to train seven employees in seclusion and restraint techniques. 
Based on one psychiatric registered nurse trainer conducting an 8-hour 
training course for seven CMHC staff members, we estimate that this 
requirement will cost $2,728 as calculated below.
     8 trainer hours at $47/hr = $376
     56 trainee hours at $42/hr = $2352
     $376 trainer cost + $2,352 trainee costs = $2,728
    We are also requiring that each individual receive documented, 
updated training. Again, according to National Association of 
Psychiatric Health Systems (NAPHS), annual updates involve about four 
hours of staff and instructor time per employee who has direct client 
contact. We assume an average size CMHC has seven employees with direct 
client contact who must be trained in de-escalation techniques. 
Therefore, we estimate that it will cost $1,364 annually to update each 
person's training as shown below.
     4 trainer hours at $47/hr = $188
     28 trainee hours at $42/hr = $1,176
     $188 trainer costs + $1,176 trainee costs = $1,364
    We require that each CMHC revise its training program annually as 
needed. We estimate this task, which must be completed by the trainer, 
to take approximately 4 hours annually per CMHC and have calculated 
below the

[[Page 64627]]

estimated total annual cost for all CMHCs.
     4 hours x $47/hr = $188 per CMHC
     $188 per CMHC x 100 CMHCs = $18,800 nationwide
    Table 4 below shows the initial year (one-time) and annual 
estimated CMHC burden, respectively, associated with the standards for 
the client rights CoP.

                                    Table 4--Client Rights Burden Assessment
----------------------------------------------------------------------------------------------------------------
                                                                    Total time       Cost per
               Standard                   Time per average CMHC     (in hours)     average CMHC     Total cost
----------------------------------------------------------------------------------------------------------------
Client rights notification............  9.47 hours..............             947            $445         $44,509
Addressing violations.................  22 hours................           2,200           1,452         145,200
4 day trainer training *..............  32 hours................           3,200           4,463         446,300
Staff training program development *..  40 hours................           4,000           1,880         188,000
Staff training *......................  64 hours................           6,400           2,728         272,800
Staff training update.................  32 hours................           3,200           1,364         136,400
Staff training program update.........  4 hours.................             400             188          18,800
                                       -------------------------------------------------------------------------
    Totals 1st year...................  167.47..................          16,747          10,968       1,096,809
    Totals Annually...................  67.47...................           6,747          3, 449         344,909
----------------------------------------------------------------------------------------------------------------
* Initial year (one-time) burden items.

Admission, Initial Evaluation, Comprehensive Assessment and Discharge 
or Transfer of the Client (Sec.  485.914)
    With respect to the CoP for admission, initial evaluation, 
comprehensive assessment and discharge or transfer of the client, we 
believe that several of the standards associated with the CoP are 
unlikely to impose a burden on CMHCs. Specifically, the requirements 
for admitting a client, initially evaluating a client, and completing a 
comprehensive assessment of each client's needs are standard medical 
practice; therefore, they do not impose a burden upon a CMHC.
    Moreover, the requirement to update the comprehensive assessment 
does not impose a burden upon CMHCs. Currently, all CMHCs are required 
by CMS payment rules (Sec.  424.24(e)(3)) to recertify a Medicare 
client's eligibility for partial hospitalization services. Therefore, 
the 13,600 Medicare beneficiaries who received partial hospitalization 
services have already received an updated assessment in order for the 
CMHC to recertify their eligibility. In addition, updating client 
assessments is part of standard medical practice to ensure that care is 
furnished to meet current client needs and treatment goals. Therefore, 
we believe that this requirement does not impose a burden upon a CMHC. 
Further, as part of the CMHC care model, it is assumed that clients 
will eventually be discharged or transferred from the CMHC's care. As 
such, CMHCs routinely plan for and implement client discharges and 
transfers. Therefore, we believe that the standard for the discharge or 
transfer of the client is part of a CMHC's standard practice and does 
not pose additional burden to CMHCs.
Treatment Team, Active Treatment Plan, and Coordination of Services 
(Sec.  485.916)
    Under the CoP for treatment team, active treatment plan, and 
coordination of services, we assessed the potential impact of the 
following standards on CMHCs: Delivery of services, active treatment 
plan, content of the active treatment plan, review of the active 
treatment plan, and coordination of services. First, the standard for 
delivery of services sets forth the required members of each CMHC's 
client's active treatment team and requires these members to work 
together to meet the needs of each CMHC client. We believe it is 
standard practice within the CMHC industry to include these identified 
members in an active treatment team and, therefore, this requirement 
does not pose a burden.
    Furthermore, this standard requires the CMHC to determine the 
appropriate licensed mental health processional, who is a member of the 
client's interdisciplinary treatment team, to be designated for each 
client as a care coordinator. The designated individual will be 
responsible for coordinating an individual client's care, including 
ensuring that the client's needs are fully assessed and reassessed in a 
timely manner, and that the client's active treatment plan is fully 
implemented. CMHCs may choose to assign a single individual to perform 
this function for all clients of the CMHC, or it may divide this duty 
between several individuals, assigning specific clients to specific 
individuals. While we believe that CMHCs already actively work to 
coordinate client assessment, care planning, and care implementation, 
we also believe that designating specific individuals to perform this 
function may be new to CMHCs. We estimate that, on average, designated 
CMHC staff will spend 20 to 30 minutes per client per week (76 to 114 
hours annually) overall to fulfill this requirement. The annual cost 
per CMHC associated with this requirement is $3,572 to $5,358 for a 
psychiatric registered nurse, $2,356 to $3,534 for a mental health 
counselor, or $2,660 to $3,990 for a clinical social worker. The 
aggregate annual cost for all CMHCs is $357,200 to $535,800 if a 
psychiatric registered nurse is used; $235,600 to $353,400 if a mental 
health counselor is used, or $266,000 to $399,000, if a clinical social 
worker is used. This estimated burden is shown in Table 5 below.
    Finally, paragraph (a)(4) of this standard requires a CMHC that has 
more than one interdisciplinary treatment team to designate a single 
team that is responsible for establishing policies and procedures 
governing the day-to-day provision of CMHC care and services. We 
believe that using multiple disciplines to establish client care 
policies and procedures is standard practice and does not pose a 
burden.
    The active treatment plan standard and its content sets forth the 
requirements for each client's active treatment plan. The written 
active treatment plan will be established by the client and 
interdisciplinary treatment team. It will address the client's needs as 
they were identified in the initial evaluation and subsequent 
comprehensive assessment. We estimate that establishing the first 
comprehensive active treatment plan requires 35 minutes of the 
interdisciplinary treatment team's time. We estimate that compliance 
with the requirements at Sec.  485.916(c) requires a licensed 
professional member of the

[[Page 64628]]

interdisciplinary team (for this burden estimate, we used the nurse) a 
total of 35 minutes per client, for a total of 132 hours per CMHC. 
Based on the nurses' hourly rate, the total cost will be $6,204 per 
CMHC.
    The standard for review of the active treatment plan requires the 
interdisciplinary treatment team to review and revise the active 
treatment plan as necessary, but no less frequently than every 30 
calendar days. We estimate that updating the content of the active 
treatment plan requires 10 minutes of the interdisciplinary treatment 
team's time. Therefore, we estimate that compliance with the 
requirements at Sec.  485.916(d) requires a licensed professional 
member of the interdisciplinary team (for this burden estimate we used 
the nurse) a total of 10 minutes per client, for a total of 38 hours 
per CMHC. Based on the nurse's hourly rate, the total cost will be 
$1,786 per CMHC.
    In addition, the coordination of services standard requires a CMHC 
to have and maintain a system of communication, in accordance with its 
own policies and procedures, to ensure the integration of its services 
and systems. We believe that active communication within health care 
providers, including CMHCs, is standard practice; therefore, this 
requirement does not impose a burden.
    Table 5 below shows the annual estimated CMHC burden associated 
with the standards for the treatment team, active treatment plan, and 
coordination of services CoP.

                             Table 5--Treatment Team, Active Treatment Plan, and Coordination of Services Burden Assessment
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Time per average CMHC
                                                         (in hours)           Total time (in hours)     Cost per average CMHC          Total cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Psychiatric Registered Nurse....................                 76 to 114           7,600 to 11,400          $3,572 to $5,358      $357,200 to $535,800
                                                               Average: 95            Average: 9,500           Average: $4,465         Average: $446,500
Mental Health Counselor.........................                 76 to 114           7,600 to 11,400          $2,356 to $3,534      $235,600 to $353,400
                                                               Average: 95            Average: 9,500           Average: $2,945         Average: $294,500
Clinical Social Worker..........................                 76 to 114           7,600 to 11,400          $2,660 to $3,990      $266,000 to $399,000
                                                               Average: 95            Average: 9,500           Average: $3,325         Average: $332,500
**Total Average (for all disciplines)...........                 76 to 114      Total Average Range:      Total Average Range:      Total Average Range:
                                                         Total Average: 95              7,600-11,400             $2,862-$4,294         $286,200-$429,400
                                                                                Total Average: 9,500     Total Average: $3,578   Total Average: $357,800
Development of the Active Treatment Plan........                       132                    13,200                    $6,204                  $620,400
Review and Update of the Active Treatment Plan..                        38                     3,800                    $1,786                  $178,600
                                                 -------------------------------------------------------------------------------------------------------
    Total.......................................                       265                    26,500                   $11,568                $1,156,800
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Note: CMHC will choose one of the providers in table 5 to coordinate each client care.
** Note: The Total columns represent an average of all 3 provider type.

Quality Assessment and Performance Improvement (Sec.  485.917)
    The proposed rule provided guidance to the CMHC on how to establish 
a quality assessment and performance improvement program. It is 
estimated that a CMHC will spend approximately 20 hours a year to 
implement a quality assessment and performance improvement program. 
Many providers are already using comprehensive quality assessment and 
performance improvement programs for accreditation or independent 
improvement purposes. For those providers who choose to develop their 
own quality assessment and performance improvement program, we estimate 
that it will take 9 hours to create a program. We also estimate that 
CMHCs will spend 4 hours a year collecting and analyzing data. In 
addition, we estimate that a CMHC will spend 3 hours a year training 
their staff and 4 hours a year implementing performance improvement 
activities. Both the program development and implementation will most 
likely be managed by that CMHC's administration. Based on an 
administrator's hourly rate, the total cost of the quality assessment 
and performance improvement condition of participation is $1,320 per 
CMHC.

$66 per hour x 20 hours = $1,320

    Table 6 below shows the annual estimated CMHC burden associated 
with the standards for the quality assessment and performance 
improvement CoP.

                    Table 6--Quality Assessment and Performance Improvement Burden Assessment
----------------------------------------------------------------------------------------------------------------
                                                   Time per CMHC    Total time
                    Standard                          (hours)         (hours)      Cost per CMHC    Total cost
----------------------------------------------------------------------------------------------------------------
QAPI development................................               9             900            $594         $59,400
QAPI implementation.............................              11           1,100             726          72,600
                                                 ---------------------------------------------------------------
    Total annually..............................              20           2,000           1,320         132,000
----------------------------------------------------------------------------------------------------------------

Organization, Governance, Administration of Services, and Partial 
Hospitalization Services (Sec.  485.918)
    Under the CoP for organization, governance, administration of 
services, and partial hospitalization services, we assessed the 
potential impact of the following standards on CMHCs: Governing body 
and administration, provision of services, professional management 
responsibility, staff training, and physical environment. The governing 
body and administration standard requires a CMHC to have a designated 
governing body that assumes

[[Page 64629]]

full legal responsibility for management of the CMHC. This standard 
will also require the CMHC governing body to appoint an administrator, 
in accordance with its own education and experience requirements, who 
is responsible for the day-to-day operations of the CMHC. Having a 
governing body and a designated administrator are standard business 
practices; therefore, this requirement does not impose a burden.
    The provision of services standard sets forth a comprehensive list 
of services that CMHCs are currently required by statute and regulation 
to furnish, requires the CMHC and all individuals furnishing services 
on its behalf to meet applicable State licensing and certification 
requirements, and requires the CMHC to provide at least 40 percent of 
its items and services to individuals who are not eligible for benefits 
under title XVIII of the Act.
    In addition, the professional management responsibility standard 
requires that, if a CMHC chooses to provide certain services under 
agreement, it must ensure that the agreement is written. This standard 
will also require the CMHC to retain full professional management 
responsibility for the services provided under arrangement on its 
behalf. Full professional management responsibility will include paying 
for the arranged services and ensuring that the services are furnished 
in a safe and effective manner. Having a written agreement and 
retaining professional management of all care and services provided is 
standard practice in the health care industry. Therefore, this 
requirement does not impose a burden.
    Further, the staff training standard requires a CMHC to educate all 
staff who have contact with clients and families about CMHC care and 
services. It also requires a CMHC to provide an initial orientation for 
each staff member that addresses his or her specific job duties. 
Educating staff about the nature of CMHC care and their particular job 
duties are standard practices that would not impose a burden upon 
CMHCs.
    This standard also requires a CMHC to assess the skills and 
competency of all individuals furnishing client and family care in 
accordance with its own written policies and procedures.
    Finally, this standard requires a CMHC to provide and document its 
in-service training program. This standard does not prescribe the 
content or format of the CMHC's assessment and in-service training 
programs. Rather, it allows CMHCs to establish their own policies and 
procedures to meet their individual needs and goals. For example, this 
can be done by in-servicing on a need recognized through the QAPI 
program. We believe these requirements reflect standard practice in the 
industry and present no additional burden.
    The physical environment standard requires CMHCs to furnish 
services in a safe, comfortable, and private environment that meets all 
Federal, State, and local health and safety requirements and occupancy 
rules. We believe that this requirement does not impose a burden on 
CMHCs as it is considered standard practice to provide services in a 
physical location that is both safe and conducive to meeting the needs 
of CMHC clients.
    This standard also requires a CMHC to have an infection control 
program. While basic precautions such as thorough hand washing and 
proper disposal of medical waste are standard practice, developing a 
comprehensive infection control program may impose a burden on CMHCs. 
We estimate that an administrator will spend 8 hours on a one-time 
basis developing infection control policies and procedures and 2 hours 
per month conducting follow up efforts. The estimated cost associated 
with this provision is $528 to develop the infection control program 
and $1,584 annually to follow-up on infection control issues in the 
CMHC. We believe that staff education regarding infection control will 
be incorporated into the CMHC's in-service training program, described 
above and therefore doesn't impose additional burden.
    Table 7 below shows the initial year (one-time) and annual 
estimated CMHC burden, respectively, associated with the standards for 
the organization, governance, administration of services, and partial 
hospitalization services CoP.

   Table 7--Organization, Governance, Administration of Services, and Partial Hospitalization Services Burden
                                                   Assessment
----------------------------------------------------------------------------------------------------------------
                                                     Time per
                                                   average CMHC   Total time (in     Cost per       Total cost
                                                    (in hours)        hours)       average CMHC
----------------------------------------------------------------------------------------------------------------
Infection control policies and procedures *.....               8             800            $528         $52,800
Infection control follow-up.....................              24           2,400           1,584         158,400
                                                 ---------------------------------------------------------------
  Total 1st Year................................              32           3,200           2,112         211,200
  Total Annually................................              24           2,400           1,584         158,400
----------------------------------------------------------------------------------------------------------------
* Initial year (one-time) burden items.

    We believe that the burden associated with this rule is reasonable 
and necessary to ensure the health and safety of all CMHC clients.
1. Estimated Effects of CoPs for CMHCs on Other Providers
    We do not expect the CoPs for CMHCs included in this rule to affect 
any other providers.
2. Estimated Effects of CoPs for CMHCs on the Medicare and Medicaid 
Programs
    The budget impacts to the Medicare and Medicaid programs resulting 
from implementation of the CoPs for CMHCs included in this rule are 
negligible. Even though there is likely to be an increase in CMS 
activities, such as on-site surveys, as a result of this final rule, 
CMS will likely be compelled by budgetary constraints to accommodate 
these activities into its existing budget. We note, however, that the 
rule-induced activities have an opportunity cost equal to the value of 
activities that would have been done in the rule's absence.

C. Alternatives Considered

    CMHC providers have been operating without federally-issued health 
and safety requirements since the 1990 inception of Medicare coverage 
of partial hospitalization services in CMHCs. In place of Federal 
standards, we have relied upon State certification and licensure 
requirements to ensure the health and safety of CMHC clients.

[[Page 64630]]

However, CMS has learned that most States either do not have 
certification or licensure requirements for CMHCs or that States do not 
apply such certification or licensure requirements to CMHCs that are 
for-profit, privately owned, and/or not receiving State funds. Due to 
the possibility of significant gaps in State requirements, to ensure 
the health and safety of CMHC clients, we chose to propose and are 
finalizing a core set of health and safety requirements that will apply 
to all CMHCs receiving Medicare funds, regardless of the State in which 
the CMHC is located. These requirements ensure a basic level of 
services provided by qualified staff.
    We also considered proposing a more comprehensive set of CoPs for 
CMHCs. Such a comprehensive set of CoPs would go beyond the 
requirements in this rule to address other areas of CMHC services and 
operations, such as a clinical records requirement that would outline 
the specific contents of a clinical record. While we believe that these 
areas are important and may warrant additional consideration in future 
rulemaking, we do not believe that it is appropriate to begin with an 
expansive set of CoPs at this time. Furthermore, a comprehensive set of 
CoPs may be difficult for CMHCs to manage, considering that many CMHCs 
are not currently required to meet any health and safety standards. As 
a result, we chose to focus on a core set of requirements and allow for 
the option of additional CoPs in the future.
    Additionally, we considered proposing fewer CoPs. However, all of 
the CoPs included in this regulation are intended to act as a cohesive 
system. For example eliminating the assessment requirement would most 
likely cause issues with the formation of the interdisciplinary team 
and the client's active treatment plan. We believe that the CoPs build 
on each other, and that eliminating one or more would introduce 
vulnerabilities in patient safety.

D. Conclusion

    We estimate that this final rule will cost CMHCs approximately $3 
million in the first year of implementation and approximately $2.2 
million annually thereafter. We believe that the burden associated with 
this rule is reasonable and necessary to ensure the health and safety 
of all CMHC clients.
    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 485

    Grant programs--health, Health facilities, Medicaid, Privacy, 
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 485--CONDITIONS OF PARTICIPATION: SPECIALIZED PROVIDERS

0
1. The authority citation for part 485 continues to read as follows:

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


0
2. Add and reserve subpart I, and add a new subpart J to part 485 to 
read as follows:
Subpart I--[Reserved]
Subpart J--Conditions of Participation: Community Mental Health Centers 
(CMHCs)
Sec.
485.900 Basis and scope.
485.902 Definitions.
485.904 Condition of participation: Personnel qualifications.
485.910 Condition of participation: Client rights.
485.914 Condition of participation: Admission, initial evaluation, 
comprehensive assessment, and discharge or transfer of the client.
485.916 Condition of participation: Treatment team, person-centered 
active treatment plan, and coordination of services.
485.917 Condition of participation: Quality assessment and 
performance improvement.
485.918 Condition of participation: Organization, governance, 
administration of services, and partial hospitalization services.

Subpart J--Conditions of Participation: Community Mental Health 
Centers (CMHCs)


Sec.  485.900  Basis and scope.

    (a) Basis. This subpart is based on the following sections of the 
Social Security Act:
    (1) Section 1832(a)(2)(J) of the Act specifies that payments may be 
made under Medicare Part B for partial hospitalization services 
furnished by a community mental health center (CMHC) as described in 
section 1861(ff)(3)(B) of the Act.
    (2) Section 1861(ff) of the Act describes the items and services 
that are covered under Medicare Part B as ``partial hospitalization 
services'' and the conditions under which the items and services must 
be provided. In addition, section 1861(ff) of the Act specifies that 
the entities authorized to provide partial hospitalization services 
under Medicare Part B include CMHCs and defines that term.
    (3) Section 1866(e)(2) of the Act specifies that a provider of 
services for purposes of provider agreement requirements includes a 
CMHC as defined in section 1861(ff)(3)(B) of the Act, but only with 
respect to providing partial hospitalization services.
    (b) Scope. The provisions of this subpart serve as the basis of 
survey activities for the purpose of determining whether a CMHC meets 
the specified requirements that are considered necessary to ensure the 
health and safety of clients; and for the purpose of determining 
whether a CMHC qualifies for a provider agreement under Medicare.


Sec.  485.902  Definitions.

    As used in this subpart, unless the context indicates otherwise--
    Active treatment plan means an individualized client plan that 
focuses on the provision of care and treatment services that address 
the client's physical, psychological, psychosocial, emotional, and 
therapeutic needs and goals as identified in the comprehensive 
assessment.
    Community mental health center (CMHC) means an entity as defined in 
Sec.  410.2 of this chapter.
    Comprehensive assessment means a thorough evaluation of the 
client's physical, psychological, psychosocial, emotional, and 
therapeutic needs related to the diagnosis under which care is being 
furnished by the CMHC.
    Employee of a CMHC means an individual--
    (1) Who works for the CMHC and for whom the CMHC is required to 
issue a W-2 form on his or her behalf; or
    (2) For whom an agency or organization issues a W-2 form, and who 
is assigned to such CMHC if the CMHC is a subdivision of an agency or 
organization.
    Initial evaluation means an immediate care and support assessment 
of the client's physical, psychosocial (including a screen for harm to 
self or others), and therapeutic needs related to the psychiatric 
illness and related conditions for which care is being furnished by the 
CMHC.
    Representative means an individual who has the authority under 
State law to authorize or terminate medical care on behalf of a client 
who is mentally or physically incapacitated. This includes a legal 
guardian.
    Restraint means--
    (1) Any manual method, physical or mechanical device, material, or 
equipment that immobilizes or reduces

[[Page 64631]]

the ability of a client to move his or her arms, legs, body, or head 
freely, not including devices, such as orthopedically prescribed 
devices, surgical dressings or bandages, protective helmets, or other 
methods that involve the physical holding of a client for the purpose 
of conducting routine physical examinations or tests, or to protect the 
client from falling out of bed, or to permit the client to participate 
in activities without the risk of physical harm (this does not include 
a client being physically escorted); or
    (2) A drug or medication when it is used as a restriction to manage 
the client's behavior or restrict the client's freedom of movement, and 
which is not a standard treatment or dosage for the client's condition.
    Seclusion means the involuntary confinement of a client alone in a 
room or an area from which the client is physically prevented from 
leaving.
    Volunteer means an individual who is an unpaid worker of the CMHC; 
or if the CMHC is a subdivision of an agency or organization, is an 
unpaid worker of the agency or organization and is assigned to the 
CMHC. All volunteers must meet the standard training requirements under 
Sec.  485.918(d).


Sec.  485.904  Condition of participation: Personnel qualifications.

    (a) Standard: General qualification requirements. All professionals 
who furnish services directly, under an individual contract, or under 
arrangements with a CMHC, must be legally authorized (licensed, 
certified or registered) in accordance with applicable Federal, State 
and local laws, and must act only within the scope of their State 
licenses, certifications, or registrations. All personnel 
qualifications must be kept current at all times.
    (b) Standard: Personnel qualifications for certain disciplines. The 
following qualifications must be met:
    (1) Administrator of a CMHC. A CMHC employee who meets the 
education and experience requirements established by the CMHC's 
governing body for that position and who is responsible for the day-to-
day operation of the CMHC.
    (2) Clinical psychologist. An individual who meets the 
qualifications at Sec.  410.71(d) of this chapter.
    (3) Clinical Social worker. An individual who meets the 
qualifications at Sec.  410.73 of this chapter.
    (4) Social worker. An individual who--
    (i) Has a baccalaureate degree in social work from an institution 
accredited by the Council on Social Work Education, or a baccalaureate 
degree in psychology or sociology, and is supervised by a clinical 
social worker, as described in paragraph (b)(3) of this section; and
    (ii) Has 1 year of social work experience in a psychiatric 
healthcare setting.
    (5) Mental health counselor. A professional counselor who is 
certified and/or licensed by the State in which he or she practices, 
and has the skills and knowledge to provide a range of behavioral 
health services to clients. The mental health counselor conducts 
assessments and provides services in areas such as psychotherapy, 
substance abuse, crisis management, psychoeducation, and prevention 
programs.
    (6) Occupational therapist. A person who meets the requirements for 
the definition of ``occupational therapist'' at Sec.  484.4 of this 
chapter.
    (7) Physician. An individual who meets the qualifications and 
conditions as defined in section 1861(r) of the Act, and provides the 
services at Sec.  410.20 of this chapter, and has experience providing 
mental health services to clients.
    (8) Physician assistant. An individual who meets the qualifications 
and conditions as defined in section 1861(s)(2)(K)(i) of the Act and 
provides the services, in accordance with State law, at Sec.  410.74 of 
this chapter.
    (9) Advanced practice nurse. An individual who meets the following 
qualifications:
    (i) Is a nurse practitioner who meets the qualifications at Sec.  
410.75 of this chapter; or
    (ii) Is a clinical nurse specialist who meets the qualifications at 
Sec.  410.76 of this chapter.
    (10) Psychiatric registered nurse. A registered nurse, who is a 
graduate of an approved school of professional nursing, is licensed as 
a registered nurse by the State in which he or she is practicing, and 
has at least 1 year of education and/or training in psychiatric 
nursing.
    (11) Psychiatrist. An individual who specializes in assessing and 
treating persons having psychiatric disorders; is board certified, or 
is eligible to be board certified by the American Board of Psychiatry 
and Neurology, or has documented equivalent education, training or 
experience, and is fully licensed to practice medicine in the State in 
which he or she practices.


Sec.  485.910  Condition of participation: Client rights.

    The client has the right to be informed of his or her rights. The 
CMHC must protect and promote the exercise of these client rights.
    (a) Standard: Notice of rights and responsibilities. (1) During the 
initial evaluation, the CMHC must provide the client, the client's 
representative (if appropriate) or surrogate with verbal and written 
notice of the client's rights and responsibilities. The verbal notice 
must be in a language and manner that the client or client's 
representative or surrogate understands. Written notice must be 
understandable to persons who have limited English proficiency.
    (2) During the initial evaluation, the CMHC must inform and 
distribute written information to the client concerning its policies on 
filing a grievance.
    (3) The CMHC must obtain the client's and/or the client 
representative's signature confirming that he or she has received a 
copy of the notice of rights and responsibilities.
    (b) Standard: Exercise of rights and respect for property and 
person. (1) The client has the right to--
    (i) Exercise his or her rights as a client of the CMHC.
    (ii) Have his or her property and person treated with respect.
    (iii) Voice grievances and understand the CMHC grievance process; 
including but not limited to grievances regarding mistreatment and 
treatment or care that is (or fails to be) furnished.
    (iv) Not be subjected to discrimination or reprisal for exercising 
his or her rights.
    (2) If a client has been adjudged incompetent under State law by a 
court of proper jurisdiction, the rights of the client are exercised by 
the person appointed in accordance with State law to act on the 
client's behalf.
    (3) If a State court has not adjudged a client incompetent, any 
legal representative designated by the client in accordance with State 
law may exercise the client's rights to the extent allowed under State 
law.
    (c) Standard: Rights of the client. The client has a right to--
    (1) Be involved in developing his or her active treatment plan.
    (2) Refuse care or treatment.
    (3) Have a confidential clinical record. Access to or release of 
client information and the clinical record client information is 
permitted only in accordance with 45 CFR parts 160 and 164.
    (4) Be free from mistreatment, neglect, or verbal, mental, sexual, 
and physical abuse, including injuries of unknown source, and 
misappropriation of client property.
    (5) Receive information about specific limitations on services that 
he or she will be furnished.

[[Page 64632]]

    (6) Not be compelled to perform services for the CMHC, and to be 
compensated by the CMHC for any work performed for the CMHC at 
prevailing wages and commensurate with the client's abilities.
    (d) Standard: Addressing violations of client rights. The CMHC must 
adhere to the following requirements:
    (1) Ensure that all alleged violations involving mistreatment, 
neglect, or verbal, mental, sexual, and physical abuse, including 
injuries of unknown source, and misappropriation of client property by 
anyone, including those furnishing services on behalf of the CMHC, are 
reported immediately to the CMHC's administrator by CMHC employees, 
volunteers and contracted staff.
    (2) Immediately investigate all alleged violations involving anyone 
furnishing services on behalf of the CMHC and immediately take action 
to prevent further potential violations while the alleged violation is 
being verified. Investigations and documentation of all alleged 
violations must be conducted in accordance with procedures established 
by the CMHC.
    (3) Take appropriate corrective action in accordance with State law 
if the alleged violation is investigated by the CMHC's administration 
or verified by an outside entity having jurisdiction, such as the State 
survey and certification agency or the local law enforcement agency; 
and
    (4) Ensure that, within 5 working days of becoming aware of the 
violation, all violations are reported to the State survey and 
certification agency, and verified violations are reported to State and 
local entities having jurisdiction.
    (e) Standard: Restraint and seclusion. (1) All clients have the 
right to be free from physical or mental abuse, and corporal 
punishment. All clients have the right to be free from restraint or 
seclusion, of any form, imposed as a means of coercion, discipline, 
convenience, or retaliation by staff. Restraint or seclusion, defined 
in Sec.  485.902, may only be imposed to ensure the immediate physical 
safety of the client, staff, or other individuals.
    (2) The use of restraint or seclusion must be in accordance with 
the written order of a physician or other licensed independent 
practitioner who is authorized to order restraint or seclusion in 
accordance with State law and must not exceed one 1-hour duration per 
order.
    (3) The CMHC must obtain a corresponding order for the client's 
immediate transfer to a hospital when restraint or seclusion is 
ordered.
    (4) Orders for the use of restraint or seclusion must never be 
written as a standing order or on an as-needed basis.
    (5) When a client becomes an immediate threat to the physical 
safety of himself or herself, staff or other individuals, the CMHC must 
adhere to the following requirements:
    (i) Restraint or seclusion may only be used when less restrictive 
interventions have been determined to be ineffective to protect the 
client or other individuals from harm.
    (ii) The type or technique of restraint or seclusion used must be 
the least restrictive intervention that will be effective to protect 
the client or other individuals from harm.
    (iii) The use of restraint or seclusion must be implemented in 
accordance with safe and appropriate restraint and seclusion techniques 
as determined by State law.
    (iv) The condition of the client who is restrained or secluded must 
be continuously monitored by a physician or by trained staff who have 
completed the training criteria specified in paragraph (f) of this 
section.
    (v) When restraint or seclusion is used, there must be 
documentation in the client's clinical record of the following:
    (A) A description of the client's behavior and the intervention 
used.
    (B) Alternatives or other less restrictive interventions attempted 
(as applicable).
    (C) The client's condition or symptom(s) that warranted the use of 
the restraint or seclusion.
    (D) The client's response to the intervention(s) used, including 
the rationale for continued use of the intervention.
    (E) The name of the hospital to which the client was transferred.
    (f) Standard: Restraint or seclusion: Staff training requirements. 
The client has the right to safe implementation of restraint or 
seclusion by trained staff. Application of restraint or seclusion in a 
CMHC must only be imposed when a client becomes an immediate physical 
threat to himself or herself, staff or other individuals and only in 
facilities where restraint and seclusion are permitted.
    (1) Training intervals. In facilities where restraint and seclusion 
are permitted, all appropriate client care staff working in the CMHC 
must be trained and able to demonstrate competency in the application 
of restraints, implementation of seclusion, monitoring, assessment, and 
providing care for a client in restraint or seclusion and use of 
alternative methods to restraint and seclusion. In facilities where 
restraint and seclusion are not permitted, appropriate client care 
staff working in CMHC must be trained in the use of alternative methods 
to restraint and seclusion. Training will occur as follows:
    (i) Before performing any of the actions specified in this 
paragraph (f).
    (ii) As part of orientation.
    (iii) Subsequently on a periodic basis, consistent with the CMHC's 
policy.
    (2) Training content. The CMHC must require all appropriate staff 
caring for clients to have appropriate education, training, and 
demonstrated knowledge based on the specific needs of the client 
population in at least the following:
    (i) Techniques to identify staff and client behaviors, events, and 
environmental factors that may trigger circumstances that could require 
the use of restraint or seclusion.
    (ii) The use of nonphysical intervention skills.
    (iii) In facilities where restraint and seclusion are permitted, 
choosing the least restrictive intervention based on an individualized 
assessment of the client's medical and behavioral status or condition.
    (iv) The safe application and use of all types of restraint or 
seclusion that are permitted in the CMHC, including training in how to 
recognize and respond to signs of physical and psychological distress.
    (v) In facilities where restraint and seclusion are permitted, 
clinical identification of specific behavioral changes that indicate 
that restraint or seclusion is no longer necessary.
    (vi) In facilities where restraint and seclusion are permitted, 
monitoring the physical and psychological well-being of the client who 
is restrained or secluded, including, but not limited to, respiratory 
and circulatory status, skin integrity, vital signs, and any special 
requirements specified by the CMHC's policy.
    (3) Trainer requirements. Individuals providing staff training must 
be qualified as evidenced by education, training, and experience in 
techniques used to address clients' behaviors.
    (4) Training documentation. The CMHC must document in the staff 
personnel records that the training and demonstration of competency 
were successfully completed.
    (g) Standard: Death reporting requirements. The CMHC must report 
deaths associated with the use of seclusion or restraint.
    (1) The CMHC must report to CMS each death that occurs while a 
client is in restraint or seclusion awaiting transfer to a hospital.
    (2) Each death referenced in paragraph (g)(1) of this section must 
be

[[Page 64633]]

reported to the CMS Regional Office by telephone no later than the 
close of business the next business day following knowledge of the 
client's death.
    (3) Staff must document in the client's clinical record the date 
and time the death was reported to CMS.


Sec.  485.914  Condition of participation: Admission, initial 
evaluation, comprehensive assessment, and discharge or transfer of the 
client.

    The CMHC must ensure that all clients admitted into its program are 
appropriate for the services the CMHC furnishes in its facility.
    (a) Standard: Admission. (1) The CMHC must determine that each 
client is appropriate for the services it provides as specified in 
Sec.  410.2 of this chapter.
    (2) For clients assessed and admitted to receive partial 
hospitalization services, the CMHC must also meet separate requirements 
as specified in Sec.  485.918(f).
    (b) Standard: Initial evaluation. (1) A licensed mental health 
professional employed by the CMHC and acting within his or her state 
scope of practice requirements must complete the initial evaluation 
within 24 hours of the client's admission to the CMHC.
    (2) The initial evaluation, at a minimum, must include the 
following:
    (i) The admitting diagnosis as well as other diagnoses.
    (ii) The source of referral.
    (iii) The reason for admission as stated by the client or other 
individuals who are significantly involved.
    (iv) Identification of the client's immediate clinical care needs 
related to the psychiatric diagnosis.
    (v) A list of current prescriptions and over-the-counter 
medications, as well as other substances that the client may be taking.
    (vi) For partial hospitalization services only, include an 
explanation as to why the client would be at risk for hospitalization 
if the partial hospitalization services were not provided.
    (3) Based on the findings of the initial evaluation, the CMHC must 
determine the appropriate members of each client's interdisciplinary 
treatment team.
    (c) Standard: Comprehensive assessment. (1) The comprehensive 
assessment must be completed by licensed mental health professionals 
who are members of the interdisciplinary treatment team, performing 
within their State's scope of practice.
    (2) The comprehensive assessment must be completed in a timely 
manner, consistent with the client's immediate needs, but no later than 
4 working days after admission to the CMHC.
    (3) The comprehensive assessment must identify the physical, 
psychological, psychosocial, emotional, therapeutic, and other needs 
related to the client's psychiatric illness. The CMHC's 
interdisciplinary treatment team must ensure that the active treatment 
plan is consistent with the findings of the comprehensive assessment.
    (4) The comprehensive assessment, at a minimum, must include the 
following:
    (i) The reasons for the admission.
    (ii) A psychiatric evaluation, completed by a psychiatrist, non-
physician practitioner or psychologist practicing within the scope of 
State licensure that includes the medical history and severity of 
symptoms. Information may be gathered from the client's primary health 
care provider (if any), contingent upon the client's consent.
    (iii) Information concerning previous and current mental status, 
including but not limited to, previous therapeutic interventions and 
hospitalizations.
    (iv) Information regarding the onset of symptoms of the illness and 
circumstances leading to the admission.
    (v) A description of attitudes and behaviors, including cultural 
and environmental factors that may affect the client's treatment plan.
    (vi) An assessment of intellectual functioning, memory functioning, 
and orientation.
    (vii) Complications and risk factors that may affect the care 
planning.
    (viii) Functional status, including the client's ability to 
understand and participate in his or her own care, and the client's 
strengths and goals.
    (ix) Factors affecting client safety or the safety of others, 
including behavioral and physical factors, as well as suicide risk 
factors.
    (x) A drug profile that includes a review of all of the client's 
prescription and over-the-counter medications; herbal remedies; and 
other alternative treatments or substances that could affect drug 
therapy.
    (xi) The need for referrals and further evaluation by appropriate 
health care professionals, including the client's primary health care 
provider (if any), when warranted.
    (xii) Factors to be considered in discharge planning.
    (xiii) Identification of the client's current social and health 
care support systems.
    (xiv) For pediatric clients, the CMHC must assess the social 
service needs of the client, and make referrals to social services and 
child welfare agencies as appropriate.
    (d) Standard: Update of the comprehensive assessment. (1) The CMHC 
must update the comprehensive assessment via the CMHC interdisciplinary 
treatment team, in consultation with the client's primary health care 
provider (if any), when changes in the client's status, responses to 
treatment, or goal achievement have occurred.
    (2) The assessment must be updated no less frequently than every 30 
days.
    (3) The update must include information on the client's progress 
toward desired outcomes, a reassessment of the client's response to 
care and therapies, and the client's goals.
    (e) Standard: Discharge or transfer of the client. (1) If the 
client is transferred to another entity, the CMHC must, within 2 
working days, forward to the entity, a copy of--
    (i) The CMHC discharge summary.
    (ii) The client's clinical record, if requested.
    (2) If a client refuses the services of a CMHC, or is discharged 
from a CMHC due to noncompliance with the treatment plan, the CMHC must 
forward to the primary health care provider (if any) a copy of--
    (i) The CMHC discharge summary.
    (ii) The client's clinical record, if requested.
    (3) The CMHC discharge summary must include--
    (i) A summary of the services provided, including the client's 
symptoms, treatment and recovery goals and preferences, treatments, and 
therapies.
    (ii) The client's current active treatment plan at time of 
discharge.
    (iii) The client's most recent physician orders.
    (iv) Any other documentation that will assist in post-discharge 
continuity of care.
    (4) The CMHC must adhere to all Federal and State-related 
requirements pertaining to the medical privacy and the release of 
client information.


Sec.  485.916  Condition of participation: Treatment team, person-
centered active treatment plan, and coordination of services.

    The CMHC must designate an interdisciplinary treatment team that is 
responsible, with the client, for directing, coordinating, and managing 
the care and services furnished for each client. The interdisciplinary 
treatment team is composed of individuals who work together to meet the 
physical, medical, psychosocial, emotional, and therapeutic needs of 
CMHC clients.

[[Page 64634]]

    (a) Standard: Delivery of services. (1) An interdisciplinary 
treatment team, led by a physician, NP, PA, CNS, clinical psychologist, 
or clinical social worker, must provide the care and services offered 
by the CMHC.
    (2) Based on the findings of the comprehensive assessment, the CMHC 
must determine the appropriate licensed mental health professional, who 
is a member of the client's interdisciplinary treatment team, to 
coordinate care and treatment decisions with each client, to ensure 
that each client's needs are assessed, and to ensure that the active 
treatment plan is implemented as indicated.
    (3) The interdisciplinary treatment team may include:
    (i) A doctor of medicine, osteopathy or psychiatry (who is an 
employee of or under contract with the CMHC).
    (ii) A psychiatric registered nurse.
    (iii) A clinical social worker.
    (iv) A clinical psychologist.
    (v) An occupational therapist.
    (vi) Other licensed mental health professionals, as necessary.
    (vii) Other CMHC staff or volunteers, as necessary.
    (4) If the CMHC has more than one interdisciplinary team, it must 
designate the treatment team responsible for establishing policies and 
procedures governing the coordination of services and the day-to-day 
provision of CMHC care and services.
    (b) Standard: Person-centered active treatment plan. All CMHC care 
and services furnished to clients must be consistent with an 
individualized, written, active treatment plan that is established by 
the CMHC interdisciplinary treatment team, the client, and the client's 
primary caregiver(s), in accordance with the client's recovery goals 
and preferences, within 7 working days of admission to the CMHC. The 
CMHC must ensure that each client and the client's primary 
caregiver(s), as applicable, receive education and training provided by 
the CMHC that are consistent with the client's and caregiver's 
responsibilities as identified in the active treatment plan.
    (c) Standard: Content of the person-centered active treatment plan. 
The CMHC must develop a person-centered individualized active treatment 
plan for each client. The active treatment plan must take into 
consideration client recovery goals and the issues identified in the 
comprehensive assessment. The active treatment plan must include all 
services necessary to assist the client in meeting his or her recovery 
goals, including the following:
    (1) Client diagnoses.
    (2) Treatment goals.
    (3) Interventions.
    (4) A detailed statement of the type, duration, and frequency of 
services, including social work, psychiatric nursing, counseling, and 
therapy services, necessary to meet the client's specific needs.
    (5) Drugs, treatments, and individual and/or group therapies.
    (6) Family psychotherapy with the primary focus on treatment of the 
client's conditions.
    (7) The interdisciplinary treatment team's documentation of the 
client's or representative's and primary caregiver's (if any) 
understanding, involvement, and agreement with the plan of care, in 
accordance with the CMHC's policies.
    (d) Standard: Review of the person-centered active treatment plan. 
The CMHC interdisciplinary treatment team must review, revise, and 
document the individualized active treatment plan as frequently as the 
client's condition requires, but no less frequently than every 30 
calendar days. A revised active treatment plan must include information 
from the client's initial evaluation and comprehensive assessments, the 
client's progress toward outcomes and goals specified in the active 
treatment plan, and changes in the client's goals. The CMHC must also 
meet partial hospitalization program requirements specified under Sec.  
424.24(e) of this chapter if such services are included in the active 
treatment plan.
    (e) Standard: Coordination of services. The CMHC must develop and 
maintain a system of communication that assures the integration of 
services in accordance with its policies and procedures and, at a 
minimum, would do the following:
    (1) Ensure that the interdisciplinary treatment team maintains 
responsibility for directing, coordinating, and supervising the care 
and services provided.
    (2) Ensure that care and services are provided in accordance with 
the active treatment plan.
    (3) Ensure that the care and services provided are based on all 
assessments of the client.
    (4) Provide for and ensure the ongoing sharing of information among 
all disciplines providing care and services, whether the care and 
services are provided by employees or those under contract with the 
CMHC.
    (5) Provide for ongoing sharing of information with other health 
care and non-medical providers, including the primary health care 
provider, furnishing services to a client for conditions unrelated to 
the psychiatric condition for which the client has been admitted, and 
non-medical supports addressing environmental factors such as housing 
and employment.


Sec.  485.917  Condition of participation: Quality assessment and 
performance improvement.

    The CMHC must develop, implement, and maintain an effective, 
ongoing, CMHC-wide data-driven quality assessment and performance 
improvement program (QAPI). The CMHC's governing body must ensure that 
the program reflects the complexity of its organization and services, 
involves all CMHC services (including those services furnished under 
contract or arrangement), focuses on indicators related to improved 
behavioral health or other healthcare outcomes, and takes actions to 
demonstrate improvement in CMHC performance. The CMHC must maintain 
documentary evidence of its quality assessment and performance 
improvement program and be able to demonstrate its operation to CMS.
    (a) Standard: Program scope. (1) The CMHC program must be able to 
demonstrate measurable improvement in indicators related to improving 
behavioral health outcomes and CMHC services.
    (2) The CMHC must measure, analyze, and track quality indicators; 
adverse client events, including the use of restraint and seclusion; 
and other aspects of performance that enable the CMHC to assess 
processes of care, CMHC services, and operations.
    (b) Standard: Program data. (1) The program must use quality 
indicator data, including client care, and other relevant data, in the 
design of its program.
    (2) The CMHC must use the data collected to do the following:
    (i) Monitor the effectiveness and safety of services and quality of 
care.
    (ii) Identify opportunities and priorities for improvement.
    (3) The frequency and detail of the data collection must be 
approved by the CMHC's governing body.
    (c) Standard: Program activities. (1) The CMHC's performance 
improvement activities must:
    (i) Focus on high risk, high volume, or problem-prone areas.
    (ii) Consider incidence, prevalence, and severity of problems.
    (iii) Give priority to improvements that affect behavioral 
outcomes, client safety, and person-centered quality of care.
    (2) Performance improvement activities must track adverse client 
events, analyze their causes, and implement preventive actions and 
mechanisms that include feedback and learning throughout the CMHC.

[[Page 64635]]

    (3) The CMHC must take actions aimed at performance improvement 
and, after implementing those actions, the CMHC must measure its 
success and track performance to ensure that improvements are 
sustained.
    (d) Standard: Performance improvement projects. CMHCs must develop, 
implement and evaluate performance improvement projects.
    (1) The number and scope of distinct performance improvement 
projects conducted annually, based on the needs of the CMHC's 
population and internal organizational needs, must reflect the scope, 
complexity, and past performance of the CMHC's services and operations.
    (2) The CMHC must document what performance improvement projects 
are being conducted, the reasons for conducting these projects, and the 
measurable progress achieved on these projects.
    (e) Standard: Executive responsibilities. The CMHC's governing body 
is responsible for ensuring the following:
    (1) That an ongoing QAPI program for quality improvement and client 
safety is defined, implemented, maintained, and evaluated annually.
    (2) That the CMHC-wide quality assessment and performance 
improvement efforts address priorities for improved quality of care and 
client safety, and that all improvement actions are evaluated for 
effectiveness.
    (3) That one or more individual(s) who are responsible for 
operating the QAPI program are designated.


Sec.  485.918  Condition of participation: Organization, governance, 
administration of services, and partial hospitalization services.

    The CMHC must organize, manage, and administer its resources to 
provide CMHC services, including specialized services for children, 
elderly individuals, individuals with serious mental illness, and 
residents of its mental health service area who have been discharged 
from an inpatient mental health facility.
    (a) Standard: Governing body and administrator. (1) A CMHC must 
have a designated governing body made up of two or more designated 
persons, one of which may be the administrator, that assumes full legal 
authority and responsibility for the management of the CMHC, the 
services it furnishes, its fiscal operations, and continuous quality 
improvement. One member of the governing body must possess knowledge 
and experience as a mental health clinician.
    (2) The CMHC's governing body must appoint an administrator who 
reports to the governing body and is responsible for the day-to-day 
operation of the CMHC. The administrator must be a CMHC employee and 
meet the education and experience requirements established by the 
CMHC's governing body.
    (b) Standard: Provision of services. (1) A CMHC must be primarily 
engaged in providing the following care and services to all clients 
served by the CMHC regardless of payer type, and must do so in a manner 
that is consistent with the following accepted standards of practice:
    (i) Provides outpatient services, including specialized outpatient 
services for children, elderly individuals, individuals with serious 
mental illness, and residents of its mental health service area who 
have been discharged from inpatient mental health facilities.
    (ii) Provides 24-hour-a-day emergency care services.
    (iii) Provides day treatment, partial hospitalization services 
other than in an individual's home or in an inpatient or residential 
setting, or psychosocial rehabilitation services.
    (iv) Provides screening for clients being considered for admission 
to State mental health facilities to determine the appropriateness of 
such services, unless otherwise directed by State law.
    (v) Provides at least 40 percent of its items and services to 
individuals who are not eligible for benefits under title XVIII of the 
Act, as measured by the total number of CMHC clients treated by the 
CMHC for whom services are not paid for by Medicare, divided by the 
total number of clients treated by the CMHC for each 12-month period of 
enrollment.
    (A) A CMHC is required to submit to CMS a certification statement 
provided by an independent entity that certifies that the CMHC's client 
population meets the 40 percent requirement specified at this paragraph 
(b)(1)(v).
    (B) The certification statement described in paragraph (b)(1)(v)(A) 
of this section is required upon initial application to enroll in 
Medicare, and as a part of revalidation, including any off cycle 
revalidation, thereafter carried out pursuant to Sec.  424.530 of this 
chapter. Medicare enrollment will be denied or revoked in instances 
where the CMHC fails to provide the certification statement as 
required. Medicare enrollment will also be denied or revoked if the 40 
percent requirement as specified in this paragraph (b)(1)(v) is not 
met.
    (vi) Provides individual and group psychotherapy utilizing a 
psychiatrist, psychologist, or other licensed mental health counselor, 
to the extent authorized under State law.
    (vii) Provides physician services.
    (viii) Provides psychiatric nursing services.
    (ix) Provides clinical social work services.
    (x) Provides family counseling services, with the primary purpose 
of treating the individual's condition.
    (xi) Provides occupational therapy services.
    (xii) Provides services of other staff trained to work with 
psychiatric clients.
    (xiii) Provides drugs and biologicals furnished for therapeutic 
purposes that cannot be self-administered.
    (xiv) Provides client training and education as related to the 
individual's care and active treatment.
    (xv) Provides individualized therapeutic activity services that are 
not primarily recreational or diversionary.
    (xvi) Provides diagnostic services.
    (2) The CMHC and individuals furnishing services on its behalf must 
meet applicable State licensing and certification requirements.
    (c) Standard: Professional management responsibility. A CMHC that 
has a written agreement with another agency, individual, or 
organization to furnish any services under arrangement must retain 
administrative and financial management and oversight of staff and 
services for all arranged services. As part of retaining financial 
management responsibility, the CMHC must retain all payment 
responsibility for services furnished under arrangement on its behalf. 
Arranged services must be supported by a written agreement which 
requires that all services be as follows:
    (1) Authorized by the CMHC.
    (2) Furnished in a safe and effective manner.
    (3) Delivered in accordance with established professional 
standards, the policies of the CMHC, and the client's active treatment 
plan.
    (d) Standard: Staff training. (1) A CMHC must provide education 
about CMHC care and services, and person-centered care to all 
employees, volunteers, and staff under contract who have contact with 
clients and their families.
    (2) A CMHC must provide an initial orientation for each individual 
furnishing services that addresses the specific duties of his or her 
job.
    (3) A CMHC must assess the skills and competence of all individuals 
furnishing care and, as necessary, provide in-service training and 
education programs where indicated. The CMHC must have written policies 
and procedures describing its method(s)

[[Page 64636]]

of assessing competency and must maintain a written description of the 
in-service training provided during the previous 12 months.
    (e) Standard: Physical environment. (1) Environmental conditions. 
The CMHC must provide a safe, functional, sanitary, and comfortable 
environment for clients and staff that is conducive to the provision of 
services that are identified in paragraph (b) of this section.
    (2) Building. The CMHC services must be provided in a location that 
meets Federal, State, and local health and safety standards and State 
health care occupancy regulations.
    (3) Infection control. There must be policies, procedures, and 
monitoring for the prevention, control, and investigation of infection 
and communicable diseases with the goal of avoiding sources and 
transmission of infection.
    (4) Therapy sessions. The CMHC must ensure that individual or group 
therapy sessions are conducted in a manner that maintains client 
privacy and ensures client dignity.
    (f) Standard: Partial hospitalization services. A CMHC providing 
partial hospitalization services must--
    (1) Provide services as defined in Sec.  410.2 of this chapter.
    (2) Provide the services and meet the requirements specified in 
Sec.  410.43 of this chapter.
    (3) Meet the requirements for coverage as described in Sec.  
410.110 of this chapter.
    (4) Meet the content of certification and plan of treatment 
requirements as described in Sec.  424.24(e) of this chapter.
    (g) Standard: Compliance with Federal, State, and local laws and 
regulations related to the health and safety of clients. The CMHC and 
its staff must operate and furnish services in compliance with all 
applicable Federal, State, and local laws and regulations related to 
the health and safety of clients. If State or local law provides for 
licensing of CMHCs, the CMHC must be licensed. The CMHC staff must 
follow the CMHC's policies and procedures.

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

    Dated: September 19, 2013.
Marilyn Tavenner,
Administrator, Centers for Medicare & Medicaid Services.
    Approved: September 24, 2013.
Kathleen Sebelius,
Secretary, Department of Health and Human Services.
[FR Doc. 2013-24056 Filed 10-28-13; 8:45 am]
BILLING CODE 4120-01-P