EASA, which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2022-0214, dated October 21, 2022 (EASA AD 2022-0214), to correct an unsafe condition on certain serial-numbered Leonardo S.p.A. Model AW189 helicopters.

The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to certain Leonardo S.p.a. Model AW189 helicopters. The NPRM published in the Federal Register on February 27, 2024 (89 FR 14420). The NPRM was prompted by a report of an uncommanded deployment of the ELS. Subsequent investigation determined incorrect installation of its control cable could have caused the occurrence. The NPRM proposed to require a one-time inspection of the life-raft installations and, depending on the results, accomplishing additional actions, as specified in EASA AD 2022-0214.

The FAA is issuing this AD to address unintended activation and deployment of the ELS. The unsafe condition, if not addressed, could result in unintended activation and deployment of the ELS in flight with possible impact on the rotors, resulting in reduced control of the helicopter.

The FAA received no comments on the NPRM or on the determination of the costs.

These helicopters have been approved by EASA and are approved for operation in the United States. Pursuant to the FAA's bilateral agreement with the European Union, EASA has notified the FAA about the unsafe condition described in its AD. The FAA reviewed the relevant data and determined that air safety requires adopting this AD as proposed. Accordingly, the FAA is issuing this AD to address the unsafe condition on these helicopters.

EASA AD 2022-0214 requires a one-time inspection of both the left- and right-side life-raft installations for certain serial-numbered helicopters and, depending on findings, replacing its control cable and checking the assembly, replacing a cable pulley cover, correcting the cable installation, and replacing the life-raft assembly, as applicable.

This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

The FAA also reviewed Leonardo Helicopters Alert Service Bulletin No.189-315, dated October 20, 2022. This service information specifies procedures for inspecting the ELS.

The service information referenced in EASA AD 2022-0214 specifies taking pictures, completing an inspection report, and sending removed parts to the manufacturer, whereas this AD does not include those actions.

The service information referenced in EASA AD 2022-0214 cautions that step 3.3 shall be performed by trained operators or by authorized service stations only, whereas this AD requires that step to be accomplished by persons authorized under 14 CFR 43.3.

EASA AD 2022-0214 refers to the emergency life-raft assembly inspection as a “check,” whereas this AD refers to that action as an “inspection” because that action must be accomplished by persons authorized under 14 CFR 43.3.

EASA AD 2022-0214 allows installing inoperative placard(s) in clear view of both pilots to defer certain corrective action, provided all flight crews are informed and, thereafter, the helicopter is operated accordingly. FAA regulations mandate compliance with placards. However, this AD does not require informing flight crews or operating the helicopter accordingly because compliance with such requirements in an AD is impracticable to demonstrate or track on an ongoing basis; therefore, a requirement to operate the aircraft in such a manner is unenforceable. Nonetheless, flight crews of the helicopters identified in the applicability must operate in accordance with the placard(s) in this AD.

The FAA estimates that this AD affects 4 helicopters of U.S. Registry. Labor rates are estimated at $85 per work-hour. Based on these numbers, the FAA estimates the following costs to comply with this AD.

Inspecting the left- and right-hand side life-raft installations will take approximately 4 work-hours for an estimated cost of $340 per helicopter and $1,360 for the U.S. fleet.

If required, replacing a control cable and inspecting the life-raft assembly will take approximately 1 work-hour and parts cost approximately $1,665 for an estimated cost of $1,750 per side. If required, replacing a pulley cover will take approximately 0.5 work-hour and parts cost approximately $100 for an estimated cost of $143 per side. If required, correcting the cable installation will take approximately 4 work-hours and cost approximately $340 per side. If required, replacing a life raft assembly will take approximately 4 work-hours and parts cost approximately $125,700 for an estimated cost of $126,040 per side.

The FAA has included all known costs in its cost estimate. According to the manufacturer, however, some of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected operators.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.

The FAA is issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: General requirements. Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

This AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866,

(2) Will not affect intrastate aviation in Alaska, and

(3) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:

The FAA invites you to send any written relevant data, views, or arguments about this final rule. Send your comments to an address listed under ADDRESSES . Include “Docket No. FAA-2024-1292; Project Identifier MCAI-2023-00908-T” at the beginning of your comments. The most helpful comments reference a specific portion of the final rule, explain the reason for any recommended change, and include supporting data. The FAA will consider all comments received by the closing date and may amend this final rule because of those comments.

Except for Confidential Business Information (CBI) as described in the following paragraph, and other information as described in 14 CFR 11.35, the FAA will post all comments received, without change, to regulations.gov, including any personal information you provide. The agency will also post a report summarizing each substantive verbal contact received about this final rule.

CBI is commercial or financial information that is both customarily and actually treated as private by its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552), CBI is exempt from public disclosure. If your comments responsive to this AD contain commercial or financial information that is customarily treated as private, that you actually treat as private, and that is relevant or responsive to this AD, it is important that you clearly designate the submitted comments as CBI. Please mark each page of your submission containing CBI as “PROPIN.” The FAA will treat such marked submissions as confidential under the FOIA, and they will not be placed in the public docket of this AD. Submissions containing CBI should be sent to William Reisenauer, Aviation Safety Engineer, FAA, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; telephone 516-228-7300; email 9-avs-nyaco-cos@faa.gov. Any commentary that the FAA receives which is not specifically designated as CBI will be placed in the public docket for this rulemaking.

Transport Canada, which is the aviation authority for Canada, has issued Transport Canada AD CF-2023-57, dated July 25, 2023 (Transport Canada AD CF-2023-57) (also referred to after this as the MCAI), to correct an unsafe condition on certain Airbus Canada Limited Partnership Model BD-500-1A11 airplanes. The MCAI states that a design review of the wardrobe PLB with lithium batteries indicated that certain original design assumptions were incorrect. The subject PLB, if installed, is in the left-side forward wardrobe. It was found that the heat generated by a thermal runaway event, caused by the lithium batteries, would not be sufficiently mitigated by the PLB design to prevent any adverse effect on the two portable oxygen cylinder assemblies (POCAs) located near the PLB installation. As a result, a thermal runaway could lead to the release of oxygen from each POCA, which could feed the fire caused by the thermal runaway of the lithium batteries.

The FAA is issuing this AD to prevent a lithium battery fire of the PLB at the left-side forward wardrobe assembly. The unsafe condition, if not addressed, could result in fire and smoke in the cabin leading to reduced ability of the flightcrew to maintain the safe flight and landing of the airplane. You may examine the MCAI in the AD docket at regulations.gov under Docket No. FAA-2024-1292.

The FAA reviewed Transport Canada AD CF-2023-57, which specifies procedures for removal of the PLB part number (P/N) 500-12Y, modification of the left-side forward wardrobe assembly, and installation of a new PLB P/N 500-32-2Y-H with a new mounting bracket and hardware attachments. This material is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in ADDRESSES .

This product has been approved by the aviation authority of another country and is approved for operation in the United States. Pursuant to the FAA's bilateral agreement with this State of Design Authority, it has notified the FAA of the unsafe condition described in the MCAI referenced above. The FAA is issuing this AD after determining that the unsafe condition described previously is likely to exist or develop on other products of the same type design.

This AD requires accomplishing the actions specified in Transport Canada AD CF-2023-57 described previously, except for any differences identified as exceptions in the regulatory text of this AD. This AD also prohibits the installation of affected parts.

In the FAA's ongoing efforts to improve the efficiency of the AD process, the FAA developed a process to use some civil aviation authority (CAA) ADs as the primary source of information for compliance with requirements for corresponding FAA ADs. The FAA has been coordinating this process with manufacturers and CAAs. As a result, Transport Canada AD CF-2023-57 is incorporated by reference in this AD. This AD requires compliance with Transport Canada AD CF-2023-57 in its entirety through that incorporation, except for any differences identified as exceptions in the regulatory text of this AD. Service information required by Transport Canada AD CF-2023-57 for compliance will be available at regulations.gov under Docket No. FAA-2024-1292 after this AD is published.

Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5 U.S.C. 551 et seq. ) authorizes agencies to dispense with notice and comment procedures for rules when the agency, for “good cause,” finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under this section, an agency, upon finding good cause, may issue a final rule without providing notice and seeking comment prior to issuance. Further, section 553(d) of the APA authorizes agencies to make rules effective in less than thirty days, upon a finding of good cause.

There are currently no domestic operators of these products. Accordingly, notice and opportunity for prior public comment are unnecessary, pursuant to 5 U.S.C. 553(b)(3)(B). In addition, for the foregoing reason(s), the FAA finds that good cause exists pursuant to 5 U.S.C. 553(d) for making this amendment effective in less than 30 days.

The requirements of the Regulatory Flexibility Act (RFA) do not apply when an agency finds good cause pursuant to 5 U.S.C. 553 to adopt a rule without prior notice and comment. Because the FAA has determined that it has good cause to adopt this rule without prior notice and comment, RFA analysis is not required.

Currently, there are no affected U.S.-registered airplanes. If an affected airplane is imported and placed on the U.S. Registry in the future, the FAA provides the following cost estimates to comply with this AD:

The FAA has included all known costs in its cost estimate. According to the manufacturer, however, some or all of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected operators.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs describes in more detail the scope of the Agency's authority.

The FAA is issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: General requirements. Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

This AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866, and

(2) Will not affect intrastate aviation in Alaska.

Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:

The Privacy Act  1 establishes a code of fair information practice principles that govern Federal agencies' collection, maintenance, use, and dissemination of an individual's personal information. The Privacy Act applies to information that is maintained in a “system of records,” defined as a group of any records under the control of an agency from which information is retrieved by the name of the individual or by some identifying number, symbol, or other identifying particular assigned to the individual. 2

In addition to establishing a code of fair information practice principles, the Privacy Act restricts disclosure of records containing personal information that an agency maintains. 3 The Privacy Act also grants individuals an increased right of access to records maintained about themselves as well as the right to request amendment of those records upon a showing that they are not accurate, relevant, timely, or complete. 4 The Privacy Act also permits agencies, where certain requirements are met and subject to limitations set forth in the Privacy Act, to specifically exempt systems of records from certain provisions of the Privacy Act, mainly pertaining to the Privacy Act's provisions permitting individuals to access and request amendment of their records. 5 In order to claim an exemption, the agency must engage in a rulemaking process pursuant to the Administrative Procedure Act  6 and make clear to the public why particular exemptions are being invoked. 7

On February 2, 2024, the Commission published a notice of proposed rulemaking (NPRM)  8 to revise certain of the Commission's part 146 regulations. 9 Current Commission regulations §§ 146.12 and 146.13 (together, Privacy Act regulations) assert exemptions for certain of the Commission's systems of records that contain records related to the Commission's investigatory mission and personnel security obligations. After reviewing those regulations, the Commission preliminarily determined that the current Privacy Act regulations do not include all of the systems of records for which the Commission would, in fact, assert exemptions, and those systems of records that are currently referenced are not clearly identified with each system of records' number and accurate title. The Commission also preliminarily determined to add more specificity regarding the rationale for exempting each of the systems of records in order to better demonstrate the Commission's compliance with sections (j) and (k) of the Privacy Act  10 and the corresponding guidance in OMB Circular A-108. 11 OMB A-108, issued in 2016, provides that, at minimum, an agency's Privacy Act exemption regulations shall include the specific name of any systems of records that will be exempt pursuant to the regulations, the specific provisions of the Privacy Act from which the systems of records will be exempt and the reasons therefor, and an explanation of why the exemption is necessary and appropriate.

In the NPRM, the Commission proposed to identify more specifically CFTC-10 Investigatory Records, CFTC-31 Closed Commission Meetings, and CFTC-44 Personnel Clearance System, identified in the current Privacy Act regulations as Exempted Investigatory Records, Exempted Closed Commission Meetings, and Exempted Employee Background Investigation Material, respectively; and proposed to add CFTC-1 Enforcement Matter Register and Matter Indices, CFTC-12 National Futures Association (NFA) Applications Suite System, and CFTC-49 Whistleblower Records. The Commission also proposed to remove Privacy Act regulation § 146.13, which provides for exempting CFTC-32 Office of the Inspector General Investigative Files, in favor of incorporating that system of records and the corresponding exemptions into Privacy Act regulation § 146.12. In addition, for all of the identified systems of records, the Commission proposed to specifically enumerate each provision of the Privacy Act from which each system of records was being exempted and the rationale for each exemption. Finally, the Commission proposed to reorganize the regulations for ease of reference.

The Commission requested comment on the justification for and the scope of each of the proposed exemptions. The Commission received no comments regarding the proposed modification to its Privacy Act regulations nor regarding any of the related matters for which comment was requested in the NPRM. Accordingly, the Commission is adopting the proposed modifications with no changes for the reasons set forth in the NPRM, as explained below.

The Commission is modifying Privacy Act regulation § 146.12 to add additional systems of records that the Commission is exempting from certain provisions of the Privacy Act, clearly identify those which it has previously exempted, remove current Privacy Act regulation § 146.13 in favor of adding the exemptions for the Office of Inspector General's system of records to § 146.12, and add more specificity regarding the rationale for exempting each of the systems of records in order to better demonstrate the Commission's compliance with sections (j) and (k) of the Privacy Act  12 and the corresponding guidance in OMB Circular A-108. 13 Specifically, the Commission is exempting the following systems of records:

CFTC-1 contains an index and registry of enforcement investigations. The Commission is exempting this system of records because the records are compiled for law enforcement purposes and must be protected from disclosure in order to maintain the integrity of the investigative process and not provide to any individual an opportunity to access records and compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information to the Commission during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities. Specifically, the Commission is exempting CFTC-1, pursuant to section (k)(2) of the Privacy Act  14 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-10 contains records compiled for law enforcement purposes, including records developed during an investigation of violations or potential violations of the Commodity Exchange Act (CEA or Act). 15 The Commission is identifying this system of records by its proper title and number, rather than as “Exempted Investigatory Records” as it was previously identified in the regulations, and setting forth the specific reasons for which it is being exempted from particular provisions of the Privacy Act. To that end, the Commission is exempting this system of records because the records must be protected from disclosure in order to maintain the integrity of the investigative process and not provide an individual an opportunity to access records and compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information to the Commission during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities. Specifically, the Commission is exempting CFTC-10, pursuant to section (k)(2) of the Privacy Act  16 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-12 contains records held by NFA on behalf of the Commission by delegated authority to support the Commission's registration and other regulatory authority. These records include records pertaining to the fitness of individuals to be registered with the Commission and engage in business activities that are subject to the Commission's jurisdiction and records pertaining to disciplinary or other adverse action investigated or taken with respect to individual registrants. The Commission is exempting this system of records because, to the extent the records pertaining to individuals that NFA holds on behalf of the Commission are investigatory records compiled for law enforcement purposes, they must be protected from disclosure in order to maintain the integrity of the investigative process and not provide to any individual an opportunity to access records and compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information to NFA acting on behalf of the Commission during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities. Specifically, the Commission is exempting CFTC-12, pursuant to section (k)(2) of the Privacy Act  17 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-31 contains records about individuals who are the subject of discussion at closed Commission meetings, including those who are the subject of investigations or who are being considered for employment. The Commission is identifying this system of records by its proper title and number rather than “Exempted Closed Commission Meetings” as it was previously identified in the regulations and setting forth the specific reasons for which it is being exempted from particular provisions of the Privacy Act. To that end, to the extent the records in this system of records pertain to law enforcement investigations, the Commission is exempting this system of records because the records must be protected from disclosure in order to maintain the integrity of the investigative process and not provide to any individual an opportunity to compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information to the Commission during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities. Finally, to the extent records in this system of records are compiled solely for the purpose of determining the suitability, eligibility, or qualifications of an individual who is being considered for employment with the Commission, the Commission is exempting this system of records where the disclosure of records would reveal the identity of somebody who provided information in the context of the Commission's determination and who had expressly requested that their identity remain confidential. The Commission has determined that such an exemption is necessary in order to obtain information relevant to its eligibility determinations. Accordingly, the Commission is exempting CFTC-31, pursuant to sections (k)(2) and (5) of the Privacy Act  18 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-32 contains records relevant to criminal and civil investigations conducted by the Office of the Inspector General (OIG). This system of records was previously included in the Commission regulation § 146.13 with exemptions promulgated pursuant to sections (j)(2) and (k)(2) of the Privacy Act, the former for records related to the OIG's criminal law enforcement activities and the latter for investigatory records compiled for law enforcement purposes not within the scope of section (j)(2). The Commission concluded that a separate Privacy Act regulation § 146.13 for exemptions taken for this OIG system of records is not required by the Privacy Act or OMB guidance. Accordingly, the Commission, after consultation with the OIG, is removing current Commission regulation § 146.13 and incorporating the exemptions for CFTC-32 into Commission regulation § 146.12. Moreover, the Commission is setting forth the specific reasons for which this system of records is being exempted from particular provisions of the Privacy Act. To that end, the Commission is exempting this system of records because the records must be protected from disclosure in order to maintain the integrity of the investigative process and not provide to any individual an opportunity to access records and compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information to the Commission during the course of the investigation under an express promise that their identities would remain confidential. This is consistent with the Inspector General Act of 1978, as amended, which prohibits disclosing the identities of Federal employees who submit complaints or other information related to investigations to the Office of the Inspector General. 19

If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities, Federal employee and contractor witnesses may risk retaliation in the Federal workplace, and any witness may risk witness interference tactics including threats, harassment, and physical and emotional harm. Specifically, the Commission is exempting this system of records, pursuant to section (j)(2) of the Privacy Act  20 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3) and (4); (d)(1) through (4); (e)(1) through (3), (e)(4)(G) through (I), (e)(5) and (8); (f); and (g). In addition, the Commission is exempting this system of records, pursuant to section (k)(2) of the Privacy Act  21 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-44 contains records related to the background investigations and security clearances of individuals who have been or are being considered for access to Commission facilities, information technology systems, and classified or confidential information. These records may include statements from individuals who have provided information in the course of a background investigation and have requested that their identity remain confidential, and records that constitute investigatory materials compiled for law enforcement purposes. The Commission is identifying this system of records by its proper title and number, rather than as “Exempted Employee Background Investigation Material” as it was previously identified in the regulations, and setting forth the specific reasons for which it is being exempted from particular provisions of the Privacy Act pursuant to both section (k)(2) and (5) of the Privacy Act. 22 To that end, to the extent records in this system of records are compiled solely for the purpose of determining an individual's suitability, eligibility, or qualifications for employment with the Commission, the Commission is explaining in Commission regulation § 146.12 that this system of records is exempt where the disclosure of records would reveal the identity of somebody who provided information in the context of the Commission's determination and who had expressly requested that their identity remain confidential in order to maintain the promised confidentiality and enable the Commission to obtain information relevant to its eligibility determinations. In addition, to the extent records in this system of records pertain to law enforcement investigations, the Commission is exempting this system of records because the records must be protected from disclosure in order to maintain the integrity of the investigative process and not provide to any individual the opportunity to compromise that process, such as through the destruction of evidence, interference with witnesses, or otherwise. The Commission also is exempting this system of records in order to keep confidential the identity of sources who provided information to the Commission during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs for its law enforcement activities. Specifically, the Commission is exempting this system of records, pursuant to sections (k)(2) and (5) of the Privacy Act  23 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

CFTC-49 contains records related to whistleblower tips, complaints and referrals, records related to investigations and inquiries into whistleblower complaints, and records related to the whistleblower award claim and determination process. The Commission is exempting this system of records because the records are compiled for law enforcement purposes and must be protected from disclosure in order to maintain the integrity of the whistleblower process and not provide to any individual an opportunity to access records and compromise an investigation, such as through the destruction of evidence, interference with witnesses, or otherwise. In addition, the Commission is exempting this system of records in order to keep confidential the identity of sources who provided information during the course of the investigation under an express promise that their identities would remain confidential. If an individual can access the identities of confidential sources, those sources may be unwilling to provide information that the Commission needs to investigate whistleblower tips, complaints, and referrals. Specifically, the Commission is exempting this system of records, pursuant to section (k)(2) of the Privacy Act  24 and subject to the requirements and limitations set forth therein, from the following provisions of the Privacy Act: 5 U.S.C. 552a(c)(3); (d)(1) through (4); (e)(1); (e)(4)(G) through (I); and (f).

The Regulatory Flexibility Act (RFA) requires Federal agencies to consider whether the rules they adopt will have a significant economic impact on a substantial number of small entities and, if so, to provide a regulatory flexibility analysis regarding the economic impact on those entities. 25 This final rule provides additional specificity regarding the systems of records that the Commission is exempting from the Privacy Act, sets forth the reasons for those exemptions, and reorganizes the regulations for ease of reference. These changes clarify the exemptions established under the Commission's regulations and do not impose any additional burden on individuals who may seek access to records under the Privacy Act.

Moreover, the final rules will not impact small entities as defined under the RFA. The modified regulations, issued under the Privacy Act, exempt certain systems of records maintained by the Commission from certain provisions of the Privacy Act, primarily those provisions related to an individual's right to access and seek amendment of those records. Individuals are defined in the Privacy Act as United States citizens or aliens lawfully admitted to the United States for permanent residence. 26 Small entities, as defined in the RFA, are not individuals under the Privacy Act and are not provided rights thereunder; therefore, the final rules do not impact small entities as defined under the RFA. Accordingly, the Chairman, on behalf of the Commission, hereby certifies pursuant to 5 U.S.C. 605(b), that this rule will not have a significant economic impact on a substantial number of small entities.

The Paperwork Reduction Act (PRA) imposes certain requirements on Federal agencies in connection with their conducting or sponsoring any collection of information. 27 The Commission may not conduct or sponsor, and a respondent is not required to respond to, a request for collection of information unless the information collection request displays a currently valid control number issued by OMB. This rule does not contain a “collection of information,” as defined in the PRA. Accordingly, the requirements imposed by the PRA are not applicable to this rule.

Section 15(a) of the CEA provides that, before promulgating a regulation under the CEA or issuing an order, the Commission shall consider the costs and benefits of the action of the Commission. 28 Section 15(a) further specifies that the costs and benefits shall be evaluated in light of five broad areas of market and public concern: (1) protection of market participants and the public; (2) efficiency, competitiveness, and financial integrity of the futures markets; (3) price discovery; (4) sound risk management practices; and (5) other public interest considerations. 29 The modified rules are being promulgated under the Privacy Act and pertain to the rights of individuals with respect to records the Commission maintains about them. The modified rules are not being promulgated under the CEA. Therefore, the Commission finds that the considerations enumerated in section 15(a)(2) of the CEA are not applicable here.

Section 15(b) of the CEA requires the Commission to “take into consideration the public interest to be protected by the antitrust laws and endeavor to take the least anticompetitive means of achieving the purposes of this Act, in issuing any order or adopting any Commission rule or regulation (including any exemption under section 4(c) or 4c(b)), or in requiring or approving any bylaw, rule, or regulation of a contract market or registered futures association established pursuant to section 17 of this Act.”  30

The Coast Guard is issuing this temporary rule under authority in 5 U.S.C. 553(b)(B). This statutory provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency, for good cause, finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” The Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it is impracticable. The Coast Guard received all relevant information for the transfer of the rubber tire gantry cranes and the need for the safety zone on May 15, 2024. Insufficient time remains to publish an NPRM and receive and consider public comments because the rulemaking process would not be completed before June 15, 2024. Proceeding with the NPRM process would delay the establishment of the safety zones beyond the event date, compromising the safety of the M/V HAPPY DIAMOND, the crew, and other vessels navigating in surrounding waterways. Therefore, it is impracticable to publish an NPRM because we must establish the temporary safety zone by June 15, 2024.

Also, under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable because prompt action is needed to respond to the potential safety hazards associated with the transfer of rubber tire gantry cranes beginning on June 15, 2024.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034. The Captain of the Port Houston-Galveston (COTP) has determined that potential hazards associated with the transfer of rubber tire gantry cranes starting June 15, 2024, will be a safety concern for anyone within a 100-yard radius while the M/V HAPPY DIAMOND is in transit and for anyone within 25-yard radius while the M/V HAPPY DIAMOND is moored. This rule is needed to protect persons, property, and the marine environment within the navigable waters of the safety zones while the M/V HAPPY DIAMOND transits to and unloads in Seabrook, Texas.

This rule establishes two temporary safety zones from 5 a.m. on June 15, 2024, through 4 p.m. on June 30, 2024. The temporary safety zones include a moving safety zone, covering all navigable waters within 100 yards of the M/V HAPPY DIAMOND general cargo ship, and a fixed safety zone, covering all navigable waters within 25 yards of M/V HAPPY DIAMOND. The duration of the zones is intended to ensure the safety of the public and navigable waters in the specified areas during the transit of the rubber tire gantry cranes in the Houston Ship Channel and while the vessel is moored and unloading. No vessel or person will be permitted to enter, transit through, anchor in, or remain within the safety zones without obtaining permission from the COTP or a designated representative.

Moving Safety Zone: This area includes all waters within 100 yards of the M/V HAPPY DIAMOND as the vessel transits from the Gulf of Mexico off the coast of Galveston and through the Houston Ship Channel. The approximate start position is 29°19′01.21″ N, 094°38′38.1″ W, located in the Gulf of Mexico off the coast of Galveston, Texas.

Fixed Safety Zone: This area includes all waters within 25 yards of the M/V HAPPY DIAMOND once the M/V HAPPY DIAMOND is moored at Bayport Terminal in Seabrook, Texas, 29°36′18.61″ N, 095°0′25.12″ W.

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below, we summarize our analyses based on a number of these statutes and Executive orders, and we discuss the First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. This rule has not been designated a “significant regulatory action” under section 3(f) of Executive Order 12866, as amended by Executive Order 14094 (Modernizing Regulatory Review). Accordingly, the Office of Management and Budget has not reviewed this rule.

This regulatory action determination is based on the safety zones' size, location, duration, and time-of-day. The safety zones will be enforced for 15 days during the transfer of rubber tire gantry cranes in the Houston Ship Channel. Although the rule prohibits persons and vessels from entering, transiting through, anchoring in, or remaining within the regulated area without authorization from the COTP or a designated representative, they may operate in the surrounding areas during the enforcement period. The Coast Guard will provide advance notification of the safety zones to the local maritime community by Local Notice to Mariners and/or Broadcast Notice to Mariners, and the rule would allow vessels to seek permission to enter the zones.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call or email the person listed in the FOR FURTHER INFORMATION CONTACT section.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small businesses. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental principles of federalism and preemption requirements described in Executive Order 13132.

Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves safety zones that will prohibit persons and vessels from entering, transiting through, anchoring in, or remaining within the regulated area during the transfer of rubber tire gantry cranes in the Houston Ship Channel. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to call or email the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places, or vessels.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because the party conducting the work notified the Coast Guard with insufficient time to accommodate a comment period. It is impracticable to publish an NPRM because we must establish this safety zone by June 21, 2024 in order to protect the public with the hazards associated with this demolition project.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable because prompt action is needed in order to protect the public with the hazards associated with this demolition project.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034 (previously 33 U.S.C. 1231). The Captain of the Port Detroit (COTP) has determined that potential hazards associated with the boiler demolition occurring between June 21 and June 22, will be a safety concern for anyone transiting near the Trenton DTE Power plant on the Detroit River. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the boiler is being demolished.

This rule is in effective from 5:45 a.m. on June 21, 2024, through 8 a.m. on June 22, 2024. The safety zone will be enforced from 5:45 a.m. through 8 a.m. on June 21, 2024. In the case of inclement weather on June 21, 2024, this safety zone will be enforced from 5:45 a.m. through 8 a.m. on June 22, 2024.

The safety zone will cover all navigable waters a 1,000 foot radius of the Trenton DTE Boilers. The duration of the safety zone is intended to protect personnel, vessels, and the marine environment in these navigable waters while the boilers are being demolished. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB).

This regulatory action determination is based on size, location, duration, and time-of-day of the safety zone.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call or email the person listed in the FOR FURTHER INFORMATION CONTACT section.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone that will prohibit entry into the waters of 1,000 foot radius of the Trenton DTE boilers while it is demolished. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to call or email the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because publishing an NPRM would be impracticable due to the date the event is taking place. It is impracticable to publish an NPRM because we must establish this safety zone by June 21, 2024, and lacks sufficient time to provide a reasonable comment period and to consider those comments before issuing the rule. Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable and contrary to the public interest due to the date the event is taking place. Delaying the effective date of this rule would be impracticable and contrary to public interest because we must establish the safety zone by June 21, 2024, in order to protect personnel, vessels, and the marine environment from the potential safety hazards associated with the high-speed power vessel racecourse event occurring on that date.

The Coast Guard is issuing this rule under authority in 46 U.S.C. 70034. The Captain of the Port Sector Upper Mississippi River (COTP) has determined that potential hazards associated with Great Lakes Watercross Race, on June 21, 2024, will be a safety concern for anyone within the marked area of the racecourse. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the race is being conducted.

This rule establishes a safety zone from 6 a.m. through 6 p.m. each day on June 21 to June 23, 2024. The safety zone will cover all navigable waters within the Great Lakes Watercross Race, on the Upper Mississippi River, between Mile Markers 635 to 636 east of Island number one hundred seventy-two. The duration of the zone is intended to protect personnel, vessels, and the marine environment in these navigable waters while the race is conducted. No vessel or person will be permitted to transit the safety zone without obtaining permission from the COTP or a designated representative.

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. This rule has not been designated a “significant regulatory action,” under section 3(f) of Executive Order 12866, as amended by Executive Order 14094 (Modernizing Regulatory Review). Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB).

This regulatory action determination is based on the limited duration and narrowly tailored geographic areas of the safety zone. Although this rule restricts access to the waters encompassed by the safety zone, the effect of this rule will not be significant because the local waterways users will be notified to ensure the safety zone will result in minimal impact. In addition, normal marine traffic will be minimally impacted as race officials will allow traffic to pass between races. The navigation channel west of Island number one hundred seventy-two will not be impacted by the safety zone and will remain open. The vessels desiring to transit through or around the temporary safety zone may do so upon express permission from the COTP or the COTP's designated representative.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call or email the person listed in the FOR FURTHER INFORMATION CONTACT section.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

Also, this rule does not have Tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or Tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting from 6 a.m. to 6 p.m. that will prohibit entry between Mile Markers 635-636 east of Island number one hundred seventy-two. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to call or email the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places, or vessels.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

The Coast Guard will enforce the safety zone in 33 CFR 165.786, Table to § 165.786, Item 6.2, for the Annual Swim Around Key West from 7:45 a.m. until 4 p.m. on June 22, 2024. This action is being taken to provide for the safety of life on navigable waterways during this event. The regulation for recurring marine events within Sector Key West Captain of the Port (COTP) zone, § 165.786, Table to § 165.786, Item 6.2, specifies the location of the regulated area. During the enforcement period, no person or vessel may enter, transit through, anchor in, or remain within the established regulated areas without approval from the Captain of the Port Key West or designated representative. The Coast Guard may be assisted by other Federal, State, or local law enforcement agencies in enforcing this regulation.

The Coast Guard will provide notice of the regulated area by Local Notice to Mariners and Broadcast Notice to Mariners. If the Captain of the Port Key West determines that the regulated area need not be enforced for the full duration stated in this publication, he or she may use a Broadcast Notice to Mariners to grant general permission to enter the regulated area.

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule. The Coast Guard did not receive final details of the event until June 4, 2024. It is impracticable to go through the full notice and comment rulemaking process because the Coast Guard must establish this safety zone by July 4, 2024, and lacks sufficient time to provide for a comment period and then consider those comments before issuing the rule. Additionally, immediate action is needed to protect personnel, vessels, and the marine environment in the Beaufort River within the safety zone while the fireworks show is underway.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the Federal Register . Delaying the effective date of this rule would be impracticable because immediate action is necessary to protect personnel, vessels, and the marine environment from the potential safety hazards associated with the firework display launching from White Street Pier in Key West, FL.

The Coast Guard is issuing this rule under the authority in 46 U.S.C. 70034. The Captain of the Port Key West (COTP) has determined that potential hazards associated with the fireworks display on July 4, 2024, will be a safety concern for anyone within 800 feet of the White Street Pier in Key West, FL. This rule is needed to ensure the safety of vessels and persons in the navigable waters before, during, and after a barge-based fireworks display.

This rule establishes a safety zone from 8 p.m. until 10 p.m. on July 4, 2024. The safety zone will cover certain navigable waters within an 800-foot radius around the White Street Pier in Key West, FL. The duration of the zone is intended to ensure the safety of vessels and persons before, during, and after the fireworks display. No vessel or person will be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative.

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. This rule has not been designated a “significant regulatory action,” under section 3(f) of Executive Order 12866, as amended by Executive Order 14094 (Modernizing Regulatory Review). Accordingly, this rule has not been reviewed by the Office of Management and Budget (OMB).

This regulatory action determination is based on the limited duration and narrowly tailored geographic area of the safety zone. Although the rule restricts access to the waters encompassed by the safety zone, the effect of this rule will not be significant because the local waterways users will be notified to ensure the safety zone will result in minimal impact during the 2 hours of the fireworks display. Additionally, vessel traffic will be able to safely transit around the safety zone.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please call or email the person listed in the FOR FURTHER INFORMATION CONTACT section.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

We have analyzed this rule under Department of Homeland Security Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone lasting only 2 hours that will prohibit entry within an 800-foot radius from the launching area of the fireworks display. It is categorically excluded from further review under paragraph L60(a) of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to call or email the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places, or vessels.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

VA is drafting regulations to implement the PACT Act. In the interim, VA has provided sub-regulatory guidance to claims processors in the form of a Policy Letter. The Policy Letter was included as a supporting document to the Federal Register Notification published on December 22, 2022 (87 FR 78543). As discussed below, the Policy Letter is hereby revised. The revised Policy Letter can be found as a supporting document at https://www.regulations.gov.

On August 10, 2022, the PACT Act of 2022 was signed into law. This historic, multifaceted law, which triggers changes to disability compensation examination requirements when there is evidence a Veteran has participated in a toxic exposure risk activity, also expands the list of locations eligible for a presumption of exposure to radiation, expands the list of conditions subject to presumptions of service connection associated with herbicide exposure, amends the statute involving certain benefits for Persian Gulf War Veterans, establishes presumptions of service connection for conditions associated with exposure to burn pits and other toxins, and provides an avenue for a claimant-elected reevaluation of previously denied dependency and indemnity compensation (DIC) claims that can result in retroactive effective dates for benefits.

VA currently is drafting regulations to implement the PACT Act and to address any gaps and ambiguity in the statutory language. Due to the time required to promulgate regulations, VA implemented the law and began processing PACT Act-related claims on January 1, 2023, based on the sub-regulatory guidance contained in the Policy Letter issued in December 2022.

The Policy Letter has been revised to (1) clarify that under 38 U.S.C. 1168(b) a medical examination and opinion is not warranted where the only participation in a toxic exposure risk activity (TERA) that is established is based on an entry in an exposure tracking record system, such as the Individual Longitudinal Exposure Record (ILER), that does not corroborate or substantiate potential exposure to toxic substances, chemicals, or airborne hazards in service; (2) add breast cancer as a disease that the Secretary has determined has no indication of an association with herbicide exposure, so it is included on the list of conditions not warranting a medical examination and opinion under 38 U.S.C. 1168 when the only TERA is related to herbicide exposure; (3) remove renal cancer (kidney and renal pelvis) from the list of conditions established pursuant to 38 U.S.C. 1168(b) for which a medical examination and opinion is not warranted when the only TERA is related to herbicide exposure; (4) indicate that the expanded list of locations eligible for a presumption of radiation exposure under sections 401 and 402 of the PACT Act have been added to VA regulations; (5) specify that for entitlement to spina bifida benefits under 38 U.S.C. 1822, covered service in Thailand means service in Thailand at any United States or Royal Thai base during the period beginning on January 9, 1962, and ending on May 7, 1975, without regard to where on the base the Veteran was located or what military job specialty the Veteran performed; (6) add male breast cancer, urethral cancer, and cancer of the paraurethral glands as reproductive cancers under section 406 of the PACT Act; (7) remove references to “Lymphomatic cancer of any type” due to a recent law change under the National Defense Authorization Act for Fiscal Year 2023; and (8) make non-substantive edits for clarity. The revised Policy Letter allows VA to better operationalize the PACT Act and deliver earned benefits to Veterans and their dependents as quickly as possible while simultaneously continuing efforts to promulgate the implementing regulations.

Denis McDonough, Secretary of Veterans Affairs, approved and signed this document on June 7, 2024, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.

Section 3902(b) of Title 38, United States Code (U.S.C.) requires VA to provide eligible persons with “the adaptive equipment deemed necessary to insure that the eligible person will be able to operate [an] automobile or other conveyance in a manner consistent with such person's own safety and the safety of others and so as to satisfy the applicable standards of licensure established by the State of such person's residency or other proper licensing authority.” Under 38 U.S.C. 3901, eligible persons include veterans and active duty members of the Armed Forces who have been diagnosed with one or more specified disabilities. Under section 3901(2), adaptive equipment is defined to include, but is not limited to, power steering, power brakes, power window lifts, power seats, air conditioning, and other equipment necessary to help the eligible individual enter, exit, or operate the automobile or other conveyance. VA implements these statutory authorities through regulation at Title 38 Code of Federal Regulations (CFR) sections 17.155-17.159. Because VA does not have the capacity to build or install adaptive equipment for automobiles or other conveyances, VA instead reimburses eligible persons or pays registered providers for the cost of the adaptive equipment. See 38 CFR 17.156.

On March 12, 2020, VA proposed amending its regulations governing the provision of a monetary allowance to certain veterans and eligible members of the Armed Forces who require adaptive equipment to operate an automobile or other conveyance. Among other things, that proposed rule addressed establishing in regulation a VA Adaptive Equipment Schedule for Automobiles and Other Conveyances (Schedule) to calculate the amount of the monetary allowance for adaptive equipment based on industry standards and our experience administering this program, and reimbursement to eligible persons who have paid for adaptive equipment and payments made by VA directly to registered adaptive equipment providers.

We provided a 60-day period in which interested members of the public could submit comments. The comment period closed May 11, 2020 and we received four comments, two of which raised substantive issues. Based on these comments, we adopt as final this proposed rule, with changes based on public comment.

Denis McDonough, Secretary of Veterans Affairs, approved this document on June 7, 2024, and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs.

For the reasons stated in the preamble, the Department of Veterans Affairs amends 38 CFR part 17 as follows:

EPA is making several corrections for inadvertent errors in the regulatory text for the final rule:

• Two variables in the variable definitions and example of Eq. 1036.535-1 are formatted improperly in the Federal Register ; we are correcting those variable formats in 40 CFR 1036.535(b)(8).

• The equation text of Eq. 1036.545-3 was included in the signed final rule but is missing in the Federal Register ; we are restoring Eq. 1036.545-3 in 40 CFR 1036.545(f)(3).

• Two variables in the variable definitions of Eq. 1036.545-11 are formatted improperly in the Federal Register ; we are correcting those variable formats in 40 CFR 1036.545(o)(4)(iii).

• Table 1 of paragraph (b)(1) of § 1037.105 incorrectly presents the tractor vehicle standards in place of the vocational vehicle standards; we are replacing the published table with the correct table for the vocational vehicle standards in 40 CFR 1037.105(b)(1).

• Table 1 of paragraph (b)(1) of § 1037.106 as published does not clearly present the heavy-haul standards that apply each model year; we are replacing the table with an image that more clearly differentiates heavy-haul standards in 40 CFR 1037.106(b)(1).

• Paragraphs (f)(5)(ii) and (iii) of 40 CFR 1065.510 are published as a single paragraph in the Federal Register ; we are adding a line break to separate the paragraphs.

• The equation number for Eq. 1065.602-19 in 40 CFR 1065.602(m)(1)(ii) is placed below the example calculations in the Federal Register ; we are moving the equation number to be directly below the equation text.

• Subscripts within the heading of table 3 to paragraph (e)(4) of § 1065.656 are improperly formatted in the Federal Register ; we are replacing the table with an image to ensure that the characters render properly.

• The table note reference in the table caption of table 1 to paragraph (a)(1)(ii) of § 1065.750 is improperly formatted in the publication version; we are replacing the capital “A” with a lowercase “a” to match the table note format.

Section 553(b)(B) of the Administrative Procedure Act (APA), 5 U.S.C. 553(b)(B), provides that, when an agency for good cause finds that public notice and comment procedures are impracticable, unnecessary, or contrary to the public interest, the agency may issue a rule without providing notice and an opportunity for public comment. EPA has determined that there is good cause for making this technical correction final without prior proposal. Such notice and opportunity for comment is unnecessary as the technical corrections are for minor typographical and other non-substantive errors made to the signature version in preparation for publication.

This final rule is effective June 21, 2024. APA section 553(d)(3), 5 U.S.C. 553(d), provides that final rules shall not become effective until 30 days after publication in the Federal Register “except . . . as otherwise provided by the agency for good cause.” The purpose of this provision is to “give affected parties a reasonable time to adjust their behavior before the final rule takes effect.” Omnipoint Corp. v. Fed. Commc'n Comm'n, 78 F.3d 620, 630 (D.C. Cir. 1996); see also United States v. Gavrilovic, 551 F.2d 1099, 1104 (8th Cir. 1977) (quoting legislative history). Thus, in determining whether good cause exists to waive the 30-day delay, an agency should “balance the necessity for immediate implementation against principles of fundamental fairness which require that all affected persons be afforded a reasonable amount of time to prepare for the effective date of its ruling.” Gavrilovic, 551 F.2d at 1105. EPA has determined that there is good cause for making this final rule effective less than 30 days after publication in the Federal Register because the technical corrections are for minor typographical and other non-substantive errors made to the signature version in preparation for publication, these corrections will address potential confusion for regulated entities that could result if these errors introduced during preparation for publication are not corrected prior to the effective date of the final rule published in the Federal Register of Monday, April 22, 2024, and further time is not needed for regulated entities to prepare for such corrections prior to the effective date given the nature of the corrections.

For these reasons, the agency finds that good cause exists under APA section 553(d)(3) to make this rule effective June 21, 2024.

In FR Doc. 2024-06809, beginning on page 29440 in the Federal Register of Monday, April 22, 2024, the following corrections are made:

In this final rule, CMS and ONC address remaining proposals from the proposed rule titled “Medicare Program; Contract Year 2025 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly; Health Information Technology Standards and Implementation Specifications” (88 FR 78476), which appeared in the November 15, 2023 Federal Register (hereinafter referred to as the “November 2023 proposed rule”) that were not finalized.

We are finalizing changes to Part D requirements for electronic prescribing standards so that the standards required by CMS meet the needs of the health care industry. To promote alignment across HHS, in this final rule, we will require Part D sponsors, prescribers, and dispensers of covered Part D drugs for Part D eligible individuals to comply with standards CMS has either adopted directly or is requiring by cross-referencing standards ONC adopts for electronically transmitting prescriptions and prescription-related information.

Under current requirements, Part D sponsors, prescribers, and dispensers of covered Part D drugs for Part D eligible individuals are required to comply with the National Council for Prescription Drug Programs (NCPDP) SCRIPT standard version 2017071 for electronically transmitting prescriptions and prescription-related information, medication history information, and electronic prior authorization (ePA); and the NCPDP Formulary and Benefit (F&B) standard version 3.0 for electronically transmitting formulary and benefit information. Part D sponsors also are required to implement one or more electronic real-time benefit tools (RTBTs) capable of integrating with at least one prescriber's electronic prescribing system or electronic health record (EHR), but CMS does not currently require compliance with a standard for RTBTs.

ONC is adopting NCPDP SCRIPT standard version 2023011, NCPDP F&B standard version 60, and NCPDP Real-Time Prescription Benefit (RTPB) standard version 13 for HHS use. ONC is also revising its regulation so that NCPDP SCRIPT standard version 2017071 will expire for the purposes of HHS use on January 1, 2028.

As finalized, Part D standards for electronic prescribing regulations will indicate that prescriptions, medication history, and ePA must comply with a standard adopted by ONC, which will include the NCPDP SCRIPT standard version 2017071 and NCPDP SCRIPT standard version 2023011 standards. Taken in conjunction with the January 1, 2028 expiration date for NCPDP SCRIPT standard version 2017071 that ONC finalizes in this final rule, entities will be permitted to use either version of the NCPDP SCRIPT standard until NCPDP SCRIPT standard version 2017071 expires. Therefore, as of January 1, 2028, entities will be required to exclusively use NCPDP SCRIPT standard version 2023011.

With respect to electronic transmission of formulary and benefits information, we are finalizing the requirement that Part D sponsors, prescribers, and dispensers of covered Part D drugs for Part D eligible individuals can use NCPDP F&B standard version 3.0 or comply with a standard adopted by ONC, which finalizes its adoption of NCPDP F&B standard version 60 in this final rule. However, we are finalizing the requirement that, beginning January 1, 2027, these entities must comply with a standard adopted by ONC only. Therefore, as of January 1, 2027, Part D sponsors, prescribers, and dispensers of covered Part D drugs for Part D eligible individuals will be required to exclusively use NCPDP F&B standard version 60 for the electronic transmission of formulary and benefits information.

Additionally, we are finalizing a requirement that by January 1, 2027, Part D sponsor RTBTs must comply with a standard adopted by ONC, which finalizes its adoption of NCPDP RTPB standard version 13 in this final rule.

This final rule also finalizes a provision that, while not changing requirements, will cross-reference Health Insurance Portability and Accountability Act of 1996 (HIPAA) regulations in 45 CFR part 162 for eligibility transactions so that Part D requirements will automatically align with any potential future updates to the required standards for eligibility transactions. This final rule also reorganizes requirements and makes technical changes throughout § 423.160.

Section 1860D-4(e) of the Social Security Act (the Act) requires the adoption of Part D electronic prescribing (or e-prescribing) standards. Part D sponsors are required to establish electronic prescription drug programs that comply with the e-prescribing standards that are adopted under this authority. For a further discussion of the statutory requirements at section 1860D-4(e) of the Act, refer to the proposed rule titled “Medicare Program; E-Prescribing and the Prescription Drug Program,” which appeared in the February 4, 2005 Federal Register (70 FR 6255). Section 6062 of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (Pub. L. 115-271), hereinafter referred to as the SUPPORT Act, amended section 1860D-4(e)(2) of the Act to require the electronic transmission of ePA requests and responses for the Part D e-prescribing program to ensure secure ePA request and response transactions between prescribers and Part D sponsors for covered Part D drugs prescribed to Part D eligible individuals. Such electronic transmissions must comply with technical standards adopted by the Secretary. Section 119(a) of Subtitle B of Title I, Division CC of the Consolidated Appropriations Act, 2021, (CAA, 2021) added section 1860D-4(o) of the Act to require, after the Secretary has adopted a standard under section 1860D-4(o)(3) of the Act and at a time determined appropriate by the Secretary, Part D sponsors to implement one or more electronic RTBTs meeting the requirements described in section 1860D-4(o)(2) of the Act. There is generally no requirement that Part D prescribers or dispensers implement e-prescribing, with the exception of required electronic prescribing of Schedule II, III, IV, and V controlled substances that are Part D drugs, consistent with section 1860D-4(e)(7) of the Act as added by section 2003 of the SUPPORT Act and as specified at § 423.160(a)(5). However, prescribers and dispensers who electronically transmit and receive prescription and certain other information regarding covered Part D drugs prescribed for Medicare Part D eligible beneficiaries, directly or through an intermediary, are required to comply with any applicable standards that are in effect.

As specified at § 423.160(a)(1), Part D sponsors are required to support the Part D e-prescribing program transaction standards as part of their electronic prescription drug programs, as described under § 423.159(c). Likewise, as specified at § 423.160(a)(2), prescribers and dispensers that conduct electronic transactions for covered Part D drugs for Part D eligible individuals for which a program standard has been adopted must do so using the adopted standard. Transaction standards are periodically updated to take new knowledge, technology, and other considerations into account. As CMS adopted specific versions of the standards when it initially adopted the foundation and final e-prescribing standards, there was a need to establish a process by which the standards could be updated or replaced over time to ensure that the standards did not hold back progress in the health care industry. CMS discussed these processes in the final rule titled “Medicare Program; E-Prescribing and the Prescription Drug Program,” (hereinafter referred to as “the November 2005 final rule”) which appeared in the November 7, 2005 Federal Register (70 FR 67579). An account of successive adoption of new and retirement of previous versions of various e-prescribing standards is described in the final rule titled “Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule, Clinical Laboratory Fee Schedule & Other Revisions to Part B for CY 2014,” which appeared in the December 10, 2013 Federal Register (78 FR 74229); the proposed rule titled “Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program,” which appeared in the November 28, 2017 Federal Register (82 FR 56336); and the corresponding final rule (83 FR 16440), which appeared in the April 16, 2018 Federal Register . The final rule titled “Medicare Program; Secure Electronic Prior Authorization For Medicare Part D,” which appeared in the December 31, 2020 Federal Register (85 FR 86824), codified the requirement that Part D sponsors support the use of NCPDP SCRIPT standard version 2017071 for certain ePA transactions (85 FR 86832).

The final rule titled “Modernizing Part D and Medicare Advantage To Lower Drug Prices and Reduce Out-of-Pocket Expenses,” (herein after referred to as “the May 2019 final rule”) which appeared in the May 23, 2019 Federal Register (84 FR 23832), codified at § 423.160(b)(7) the requirement that Part D sponsors adopt an electronic RTBT capable of integrating with at least one prescriber's electronic prescribing or electronic health record (EHR) system, but did not name a standard since no standard had been identified as the industry standard at the time (84 FR 23851). The electronic standards for eligibility transactions were codified in the final rule titled “Medicare and Medicaid Program; Regulatory Provisions to Promote Program Efficiency, Transparency, and Burden Reduction,” which appeared in the May 16, 2012 Federal Register (77 FR 29001), to align with the applicable HIPAA transaction standards.

The Part D program has historically adopted electronic prescribing standards independently of other HHS components that may adopt electronic prescribing standards under separate authorities; however, past experience has demonstrated that duplicative adoption of health IT standards by other agencies within HHS under separate authorities can create significant burden on the health care industry as well as HHS when those standards impact the same technology systems. Notably, independent adoption of the NCPDP SCRIPT standard version 2017071 by CMS in various subsections of § 423.160 (83 FR 16638) in 2018, which required use of the standard beginning in 2020, led to a period where ONC had to exercise special enforcement discretion in its Health Information Technology (IT) Certification Program until the same version was incorporated into regulation at 45 CFR 170.205(b)(1) through the final rule titled “21st Century Cures Act: Interoperability, Information Blocking, and the ONC Health IT Certification Program,” (hereinafter referred to as the “ONC Cures Act final rule”), which appeared in the May 1, 2020 Federal Register (85 FR 25679). This resulted in significant impact on both ONC and CMS program resources. Similarly, the final rule titled “Medicare and Medicaid Program; Regulatory Provisions to Promote Program Efficiency, Transparency, and Burden Reduction,” which appeared in the May 16, 2012 Federal Register (77 FR 29002), noted that, in instances in which an e-prescribing standard has also been adopted as a HIPAA transaction standard in 45 CFR part 162, the process for updating the e-prescribing standard will have to be coordinated with the maintenance and modification of the applicable HIPAA transaction standard (77 FR 29018).

In the proposed rule titled, “Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Medicare Parts A, B, C, and D Overpayment Provisions of the Affordable Care Act and Programs of All-Inclusive Care for the Elderly; Health Information Technology Standards and Implementation Specifications” (hereinafter referred to as “the December 2022 proposed rule”), which appeared in the Federal Register on December 27, 2022 (87 FR 79452), we proposed updates to the electronic prescribing standards to be used by Part D sponsors, prescribers, and dispensers when electronically transmitting prescriptions and prescription-related information for covered Part D drugs for Part D eligible individuals . The proposals in the December 2022 proposed rule included a novel approach to updating electronic prescribing standards by proposing to cross-reference Part D requirements with standards adopted by the Office of the National Coordinator for Health Information Technology (ONC) and the standards adopted by HHS for electronic transactions under HIPAA, 1 rather than the historical approach of adopting electronic prescribing standards in the Part D regulations independently or making conforming amendments to the Part D regulations in response to updated HIPAA standards for eligibility transactions. We proposed this approach in concert with ONC in order to mitigate potential compliance challenges for the health care industry and enforcement challenges for HHS that could result from independent adoption of such standards. 2

As discussed in the November 2023 proposed rule, we withdrew all proposals contained in section III.S. Standards for Electronic Prescribing (87 FR 79548) of the December 2022 proposed rule (88 FR 78488). This approach allowed us to incorporate the feedback we received on prior proposals, seek comment on concerns raised in response to prior proposals, add new proposals, reorganize and propose technical changes to the electronic prescribing regulations at § 423.160, and allow the public to comment on all Medicare Part D electronic prescribing-related proposals simultaneously.

In sections II.A.4. through II.A.11. of this rule, we discuss the proposals related to standards for electronic prescribing that we put forth in the November 2023 proposed rule, which encompassed all of the following:

• Requiring use of NCPDP SCRIPT standard version 2023011, proposed for adoption for HHS use at 45 CFR 170.205(b)(2), and retiring use of NCPDP SCRIPT standard version 2017071 for communication of a prescription or prescription-related information supported by Part D sponsors beginning January 1, 2027. This proposal included a transition period beginning on the effective date of the final rule during which either version of the NCPDP SCRIPT standard could be used. Under this proposal, the transition period would end on January 1, 2027, which is the date that ONC proposed at 45 CFR 170.205(b)(1) that NCPDP SCRIPT standard version 2017071 would expire for the purposes of HHS use, as described in section II.B.8.a. of this rule.

• Requiring use of NCPDP RTPB standard version 13, proposed for adoption for HHS use at 45 CFR 170.205(c)(1), for prescriber RTBTs implemented by Part D sponsors beginning January 1, 2027.

• Requiring use of NCPDP Formulary and Benefit (F&B) standard version 60, proposed for adoption at 45 CFR 170.205(u)(1), and retiring use of NCPDP F&B standard version 3.0 for transmitting formulary and benefit information between prescribers and Part D sponsors beginning January 1, 2027. This proposal included a transition period beginning on the effective date of the final rule and ending January 1, 2027, during which entities would be permitted to use either NCPDP F&B standard version 3.0 (currently adopted in regulation at § 423.160(b)(5)(iii) and proposed to be moved to § 423.160(b)(3) consistent with the proposed technical changes discussed in section II.A.10 of this rule) or NCPDP F&B standard version 60, proposed for adoption for HHS use at 45 CFR 170.205(u)(1).

• Cross-referencing standards adopted for eligibility transactions in HIPAA regulations at 45 CFR 162.1202 for requirements related to eligibility inquiries.

• Making multiple technical changes to the regulation text throughout § 423.160 by removing requirements and incorporations by reference that are no longer applicable, re-organizing existing requirements, and correcting a technical error.

We proposed a novel approach to updating e-prescribing standards by cross-referencing Part D e-prescribing requirements with standards, including any expiration dates, adopted by ONC, as discussed in section II.B.5. of this rule, and the standards adopted by HHS for electronic transactions under HIPAA. This approach differed from our historical approach of adopting e-prescribing standards in the Part D regulations independently or undertaking rulemaking to make conforming amendments to the Part D regulations in response to updated HIPAA standards for eligibility transactions. 3 As ONC notes in section II.B.5. of this rule, independent adoption of the NCPDP SCRIPT standard version 2017071 in different rules  4 led to a period where ONC had to exercise special enforcement discretion in the ONC Health IT Certification Program. We believe the proposed approach mitigates potential compliance challenges for the health care industry and enforcement challenges for HHS that could result from independent adoption of such standards or asynchronous rulemaking cycles across programs. CMS invited comment on all aspects of these proposals. We also proposed to cross-reference ONC regulations adopting NCPDP SCRIPT standard version 2023011, NCPDP RTPB standard version 13, and NCPDP F&B standard version 60. We solicited comment on the effect of the proposals that, taken together, would require use of these standards by January 1, 2027 as a result of ONC's proposals to adopt these standards and retire previous versions, as well as our proposal to require use of NCPDP F&B standard version 60 by that date.

The NCPDP SCRIPT standards are used to exchange information among prescribers, dispensers, intermediaries, and Medicare prescription drug plans (PDPs). NCPDP requested that CMS adopt NCPDP SCRIPT standard version 2023011 because this version provides a number of enhancements to support electronic prescribing and transmission of prescription-related information. 5 Accordingly, we proposed to update § 423.160 to specify where transactions for electronic prescribing, medication history, and ePA are required to utilize the NCPDP SCRIPT standard. As described in section II.A.7. of this final rule, we solicited comment on the date by which use of the updated version of this and other standards in this rule would be required.

The NCPDP RTPB standard enables the real-time exchange of patient-specific eligibility, product coverage (including any restrictions and alternatives), and estimated cost sharing so prescribers have access to this information through a RTBT application at the point-of-prescribing. 6 7 As discussed in section II.A.5. of this rule, as currently codified at § 423.160(b)(7), CMS requires that Part D sponsors implement one or more electronic RTBTs that are capable of integrating with at least one prescriber's electronic prescribing system or electronic health record, as of January 1, 2021; however, at the time CMS established this requirement, no single industry standard for real-time prescription benefit applications was available. NCPDP has since developed the NCPDP RTPB standard. We proposed to require the most current version, NCPDP RTPB standard version 13, as the standard for prescriber RTBTs at § 423.160(b)(5) starting January 1, 2027.

The NCPDP F&B standard is a batch standard that provides formulary and benefit information at the plan level rather than at the patient level. The NCPDP F&B standard complements other standards utilized for electronic prescribing, electronic prior authorization, and real-time prescription benefit applications. 8 9 We proposed to require use of NCPDP F&B standard version 60, and retire NCPDP F&B standard version 3.0, beginning January 1, 2027, after a transition period during which either version may be used.

Eligibility inquiries utilize the NCPDP Telecommunication standard or Accredited Standards Committee X12N 270/271 inquiry and response transaction for pharmacy or other health benefits, respectively. The Part D program has adopted standards based on the HIPAA electronic transaction standards, which have not been updated for more than a decade. HHS has proposed updates to the HIPAA electronic transaction standards for retail pharmacies (87 FR 67638) in the proposed rule titled “Administrative Simplification: Modifications of Health Insurance Portability and Accountability Act of 1996 (HIPAA) National Council for Prescription Drug Programs (NCPDP) Retail Pharmacy Standards; and Adoption of Pharmacy Subrogation Standard” (hereinafter referred to as the “November 2022 Administrative Simplification proposed rule”), which appeared in the November 9, 2022 Federal Register (87 FR 67634).

In the November 2023 proposed rule, we proposed to update the Part D regulation at § 423.160(b)(3) to require that eligibility transactions utilize the applicable standard named as the HIPAA standard for electronic eligibility transactions at 45 CFR 162.1202. Since 45 CFR 162.1202 currently identifies the same standards that are named at § 423.160(b)(3)(i) and (ii), we anticipated there would be no immediate impact from this proposed change in regulatory language. We proposed this change to ensure that Part D electronic prescribing requirements for eligibility transactions align with the HIPAA standard for electronic eligibility transactions, should a newer version of the NCPDP Telecommunication (or other) standards be adopted as the HIPAA standard for these types of electronic transactions, if HHS' proposals in the November 2022 Administrative Simplification proposed rule are finalized or as a result of any future HHS rules.

The NCPDP SCRIPT standard has been the adopted electronic prescribing standard for transmitting prescriptions and prescription-related information using electronic media for covered Part D drugs for Part D eligible individuals since foundation standards were named in the final rule titled “Medicare Program; E-Prescribing and the Prescription Drug Program,” which appeared in the November 7, 2005 Federal Register (70 FR 67568), at the start of the Part D program. The NCPDP SCRIPT standard is used to exchange information among prescribers, dispensers, intermediaries, and Medicare prescription drug plans. In addition to electronic prescribing, the NCPDP SCRIPT standard is used in electronic prior authorization (ePA) and medication history transactions.

Although electronic prescribing is optional for physicians, except as to Schedule II, III, IV, and V controlled substances that are Part D drugs prescribed under Part D, and pharmacies, the Medicare Part D statute and regulations require drug plans participating in the prescription benefit to support electronic prescribing, and physicians and pharmacies who elect to transmit prescriptions and related communications electronically must utilize the adopted standards except in limited circumstances, as codified at § 423.160(a)(3).

NCPDP's standards development process involves a consensus-based approach to solve emerging needs of the pharmacy industry or to adapt NCPDP standards to changes made by other standards development organizations. 10 Emerging needs of the pharmacy industry may be the result of legislative or regulatory changes, health IT innovations, patient safety issues, claims processing issues, or electronic prescribing-related process automation. 11 Changes to standards are consensus-based and driven by the NCPDP membership, which includes broad representation from pharmacies, insurers, pharmacy benefit managers, Federal and State government agencies, and vendors serving all the stakeholders. 12 13

In a letter to CMS dated January 14, 2022, NCPDP requested that CMS adopt NCPDP SCRIPT standard version 2022011, given the number of updates and enhancements that had been added to the standard since NCPDP SCRIPT standard version 2017071 was adopted. 14 NCPDP summarized the major enhancements in NCPDP SCRIPT standard version 2022011 relative to the currently required NCPDP SCRIPT standard version 2017071. Those summarized enhancements include—

• General extensibility;  15

• Redesign of the Product/Drug groupings requiring National Drug Code (NDC) for DrugCoded element, but not for NonDrugCoded element;

• Addition of Observation elements to Risk Evaluation and Mitigation Strategies (REMS) transactions;

• Addition of ProhibitRenewalRequest to RxChangeResponse and RxRenewalResponse;

• Modification of Structured and Codified Sig Structure format; and

• Additional support related to dental procedure codes, RxBarCode, PatientConditions, patient gender and pronouns, TherapeuticSubstitutionIndicator, multi-party communications, and withdrawal/retracting of a previously sent message using the MessageIndicatorFlag.

Subsequently, in the December 2022 proposed rule, CMS proposed to require NCPDP SCRIPT standard version 2022011 and retire NCPDP SCRIPT standard version 2017071, after a transition period, by cross-referencing the standards as proposed for adoption by ONC. In response to this proposal, NCPDP and many other commenters recommended that CMS instead adopt the more current NCPDP SCRIPT standard version 2023011. NCPDP SCRIPT standard version 2023011, like NCPDP SCRIPT standard version 2022011, includes the functionality that supports a 3-way transaction (for example, multi-party communication) among prescriber, facility, and pharmacy, which will enable EPCS in the long-term care (LTC) setting. 16 In its comments on the December 2022 proposed rule, 17 NCPDP highlighted specific enhancements within NCPDP SCRIPT standard version 2023011 that are not present in NCPDP SCRIPT standard version 2022011, which include—

• Addition of an optional element in the header for OtherReferenceNumber for multi-party communication transactions, such as those in LTC;

• Addition of a response type of Pending for RxChangeResponse and RxRenewalResponse for communicating when to expect an approval or denial of the request or delays in approval or denial of requests;

• Addition of a new RequestExpirationDate element to NewRxRequest, RxChangeRequest, and RxRenewalRequest to notify the prescriber to not send a response after this date;

• Addition of a new element NoneChoiceID to PASelectType so that a “none of the above” answer can be selected by the provider and allow branching to the next question in a series;

• Addition of a new element for REMSReproductivePotential replacing REMSPatientRiskCategory in the prescribed medication element group in the NewRx and RxChangeRequest message and in the replace medication element group for the RxRenewalResponse;

• Addition of a new element group of ReviewingProvider to the Resupply and Recertification messages to allow for the reporting of the provider who reviewed the chart and certified continued need of a specific medication; and

• Revised guidance in the SCRIPT Implementation Guide.

NCPDP has also published frequently asked questions  18 related to the use of NCPDP SCRIPT standards for electronic transfer of controlled substance prescriptions between pharmacies, as permitted by the Drug Enforcement Administration (DEA) final rule “Transfer of Electronic Prescriptions for Schedules II-V Controlled Substances Between Pharmacies for Initial Filling,” (hereinafter referred to as “the July 2023 DEA final rule”) which appeared in the Federal Register on July 27, 2023 (88 FR 48365). The July 2023 DEA final rule permits the transfer of electronic prescriptions for schedule II-V controlled substances between retail pharmacies for initial filling, upon request of the patient, on a one-time basis, in accordance with requirements codified at 21 CFR 1306.08(e) through (i) and subject to State or other applicable law. NCPDP SCRIPT standard version 2017071 does not support the transfer of electronic controlled substance prescriptions; however, NCPDP SCRIPT standard version 2022011 and later, including NCPDP SCRIPT standard version 2023011, allow for the transfer of electronic controlled substance prescriptions since these later versions contain data elements required to document the transfer between pharmacies. NCPDP SCRIPT standard versions 2022011 and later also contain additional RxTransfer transaction features that facilitate the transfer of electronic prescriptions for controlled substances by pharmacies by allowing pharmacies to initiate transfers of prescriptions to other pharmacies (that is, “push” transactions) in addition to the functionality that currently exists in the NCPDP SCRIPT standard version 2017071 that allows pharmacies to request transfers from other pharmacies (that is, “pull” transactions).

NCPDP SCRIPT standard version 2023011 is fully backwards compatible with NCPDP SCRIPT standard version 2017071. This allows for a less burdensome implementation process and flexible adoption timeline for pharmacies, payers, prescribers, health IT vendors, and intermediaries involved in electronic prescribing, since backwards compatibility permits a transition period where both versions of the NCPDP SCRIPT standards may be used simultaneously without the need for entities involved to utilize a translator program.

Even though we withdrew the proposals contained in section III.S. (Standards for Electronic Prescribing) in the December 2022 proposed rule (87 FR 79548), we considered comments we received on the December 2022 proposed rule when crafting the proposals discussed in this rule. For instance, several commenters requested that CMS clearly indicate that the proposed version of the NCPDP SCRIPT standard would apply to medication history functions. Several commenters noted that the regulation text at § 423.160(b)(4)(ii) does not list the NCPDP SCRIPT standard-specific medication history transactions. Commenters requested that CMS list the corresponding medication history transactions (RxHistoryRequest and RxHistoryResponse) in the regulation text in order to minimize ambiguity. After considering these comments, in the November 2023 proposed rule, we proposed to list the RxHistoryRequest and RxHistoryResponse transactions at § 423.160(b)(1)(i)(U) subsequent to our technical reorganization of the section discussed in section II.A.10. of this rule, rather than list the transactions under § 423.160(b)(4).

With respect to ePA transactions in the NCPDP SCRIPT standard currently listed at § 423.160(b)(8)(i)(A) through (D) (PAInitiationRequest, PAInitiationResponse, PARequest, PAResponse, PAAppealRequest, PAAppealResponse, PACancelRequest, PACancelResponse) and a new ePA transaction (PANotification) available in NCPDP SCRIPT standard version 2023011, we proposed to list all transactions at § 423.160(b)(1)(i)(V)-(Z). We proposed new language at § 423.160(b)(1) to indicate that the transactions listed must comply with a standard in proposed 45 CFR 170.205(b) “as applicable to the version of the standard in use,” since an older version of a standard may not support the same transactions as the newer version of the standard. For example, during the proposed transition period where either NCPDP SCRIPT standard version 2017071 or NCPDP SCRIPT standard version 2023011 may be used, entities that are still using NCPDP SCRIPT standard version 2017071 would not be expected to use the PANotification transaction because the PANotification transaction is only supported in the NCPDP SCRIPT standard version 2023011.

Since the NCPDP SCRIPT standard version 2023011 is fully backwards compatible with NCPDP SCRIPT standard version 2017071, the pharmacies, payers, prescribers, health IT vendors, and intermediaries involved in electronic prescribing can accommodate a transition period when either version may be used. That is, during a transition period, transactions taking place between entities using different versions of the same standard maintain interoperability without the need for entities to utilize (that is, purchase) a translator software program. The cross-reference to proposed 45 CFR 170.205(b) permits a transition period starting as of the effective date of a final rule during which either NCPDP SCRIPT standard version 2017071 or NCPDP SCRIPT standard version 2023011 may be used.

Instead of proposing to independently adopt NCPDP SCRIPT standard version 2023011, we proposed at § 423.160(b)(1) to cross-reference a standard in 45 CFR 170.205(b). ONC proposed to adopt NCPDP SCRIPT standard version 2023011 in 45 CFR 170.205(b)(2) as described in section III.C.8.a. of the November 2023 proposed rule. This approach enables CMS and ONC to avoid misalignment from independent adoption of NCPDP SCRIPT standard version 2023011 for their respective programs. Updates to the standard would impact requirements for both programs at the same time, ensure consistency, and promote alignment for providers, payers, and health IT developers participating in and supporting the same prescription transactions. See section II.B.5. of this rule for additional discussion of this coordination effort.

In its letter to CMS requesting CMS adopt NCPDP SCRIPT standard version 2022011, NCPDP requested that CMS identify certain transactions for prescriptions for which use of the standard is mandatory. 19 As previously mentioned in this preamble, in response to the December 2022 proposed rule, NCPDP and other commenters requested additional transactions be named in regulation. As part of our proposed reorganization of § 423.160, we proposed to list all transactions associated with the NCPDP SCRIPT standard requirements in one place in the regulation. We proposed the transactions for prescriptions, ePA, and medication history for which use of the standard is mandatory at § 423.160(b)(1)(i)(A) through (Z), as described in Table 1.

The transactions specific to electronic prescribing remain the same as those required for NCPDP SCRIPT standard version 2017071 (currently codified at § 423.160(b)(2)(iv)(A) through (Z)), except where renamed as noted in Table 1. The transactions specific to ePA are also the same as those required with NCPDP SCRIPT standard version 2017071 (with one additional transaction—PA Notification), which was incorporated into the standard after NCPDP SCRIPT standard version 2017071. As discussed in section II.B.8.a. of this rule, NCPDP SCRIPT standard version 2023011 was proposed for adoption at 45 CFR 170.205(b)(2), and NCPDP SCRIPT standard version 2017071 was proposed to expire January 1, 2027 at 45 CFR 170.205(b)(1).

As stated previously, in response to the December 2022 proposed rule, several commenters pointed out that if mandatory use of an updated version of the NCPDP SCRIPT standard is delayed, then the EPCS requirement in LTC facilities should also be delayed accordingly, since NCPDP SCRIPT standard version 2017071 lacks appropriate guidance for LTC facilities. CMS was aware of this limitation in the NCPDP SCRIPT standard version 2017071, and acknowledged the challenges to EPCS faced by LTC facilities in the proposed rule “Medicare Program; CY 2022 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment Policies; Medicare Shared Savings Program Requirements; Provider Enrollment Regulation Updates; Provider and Supplier Prepayment and Post-Payment Medical Review Requirements” (hereinafter referred to as “the July 2022 proposed rule”), which appeared in the Federal Register on July 23, 2021 (86 FR 39104). However, in the July 2022 proposed rule, CMS also stated that we understood that NCPDP was in the process of creating specific guidance for LTC facilities within the NCPDP SCRIPT standard version 2017071, which would allow willing partners to enable 3-way communication between the prescriber, LTC facility, and pharmacy to bridge any outstanding gaps that impede adoption of the NCPDP SCRIPT standard version 2017071 in the LTC setting (86 FR 39329).

Similarly, in the “Medicare Program; CY 2022 Payment Policies Under the Physician Fee Schedule and Other Changes to Part B Payment Policies; Medicare Shared Savings Program Requirements; Provider Enrollment Regulation Updates; and Provider and Supplier Prepayment and Post-Payment Medical Review Requirements” final rule (hereinafter referred to as “the November 2021 final rule”), which appeared in the Federal Register on November 19, 2021 (86 FR 64996), CMS acknowledged that although 3-way communication is not as seamless in NCPDP SCRIPT standard version 2017071 as it was expected to be in later versions, EPCS was still possible with some modifications (86 FR 65364). CMS delayed EPCS compliance for prescribers' prescriptions written for beneficiaries in a LTC facility from January 1, 2022 to no earlier than January 1, 2025, in order to give prescribers additional time to make the necessary changes to conduct electronic prescribing of covered Part D controlled substance prescriptions for Part D beneficiaries in LTC facilities using NCPDP SCRIPT standard version 2017071 (86 FR 65365). We did not propose a change in the EPCS compliance date for covered Part D controlled substance prescriptions for Part D beneficiaries in LTC on the basis of the proposed adoption of NCPDP SCRIPT standard version 2023011; however, we invited comment on the status of EPCS in LTC and the degree to which LTC facilities have been able to implement guidance from NCPDP to meet the EPCS requirement.

As proposed, § 423.160(b)(1) would require use of a version of the NCPDP SCRIPT standard adopted in 45 CFR 170.205(b) to carry out the transactions listed in § 423.160(b)(1)(i)(A) through (Z). However, it would not require that all transactions be utilized if they are not needed or are not relevant to the entity. We refer readers to ONC's Interoperability Standards Advisory (ISA) website for descriptions and adoption level of transactions in the NCPDP SCRIPT standard. 21 For example, we have been informed that the “GetMessage” transaction described in Table 1 is not widely used among prescribers. For this reason, we are reiterating guidance  22 that the NCPDP SCRIPT standard transactions named are not themselves mandatory, but rather they are to be used as applicable to the entities specified at §§ 423.160(a)(1) and (2) when they are completing or supporting the transmission of information related to electronic prescriptions, electronic prior authorization, or medication history. We believe the pharmacies, payers, prescribers, health IT vendors, and intermediaries involved in electronic prescribing have been utilizing the standards in this manner, based on discussions with NCPDP. We would also like to use this opportunity to note that where entities are permitted to use more than one version of the NCPDP SCRIPT standard because more than one version of the NCPDP SCRIPT standard is adopted in 45 CFR 170.205(b), to the extent practicable, entities can utilize transactions available in different versions of the standard simultaneously. For example, as of the effective date of this final rule, entities would be permitted to use the NCPDP SCRIPT standard version 2023011 for RxTransferInitiationRequest, RxTransfer, and RxTransferConfirm transactions, but could continue to use NCPDP SCRIPT standard version 2017071 for other transactions until NCPDP SCRIPT standard version 2017071 expires for HHS use on January 1, 2028. This would enable entities to expedite implementing the functionality necessary for the transfer of electronic controlled substance prescriptions consistent with DEA requirements, as previously described, while implementing other updates associated with NCPDP SCRIPT standard version 2023011 at a later time.

In summary, with respect to changes related to requiring, via cross-reference to ONC regulations (as discussed in section II.B.8.a. of this final rule), NCPDP SCRIPT standard version 2023011 and retiring NCPDP SCRIPT standard version 2017071, we proposed a revised paragraph § 423.160(b)(1) that would—

• Consolidate all transactions for electronic prescribing, ePA, and medication history for which use of the NCPDP SCRIPT standard is mandatory at § 423.160(b)(1)(i)(A)-(Z); and

• Indicate that communication of prescriptions and prescription-related transactions listed must comply with a standard in 45 CFR 170.205(b). In conjunction with ONC proposals (discussed in section II.B.8.a. of this rule), this cross-reference would permit a transition period when either NCPDP SCRIPT standard versions 2017071 or 2023011 may be used beginning as of the effective date of a final rule and ending January 1, 2027, because, as ONC proposed at 45 CFR 170.205(b)(1), the NCPDP SCRIPT standard version 2017071 would expire January 1, 2027, after which only NCPDP SCRIPT standard version 2023011 would be available for HHS use.

We solicited comment on these proposals. A discussion of the comments received, along with our responses, follows.

Comment: All commenters supported the proposal to update NCPDP SCRIPT standard version 2017071 to NCPDP SCRIPT standard version 202311 for the electronic transmission of prescriptions and prescription-related information, including medication history and ePA.

Response: We thank commenters for their support.

Comment: Several commenters expressed concern over the proposed date of January 1, 2027 when use of NCPDP SCRIPT standard version 2023011 would be required.

Response: See section II.A.7. of this rule for discussion of this concern.

Comment: One commenter requested that the exemption from the use of the NCPDP SCRIPT standard (and when use of HL7 messages are permitted) for the transmission of prescriptions and prescription-related information internally when the sender and recipient are part of the same legal entity be extended to the prescription transfer transactions when the sender and the recipient are not part of the same legal entity. For example, transferring a prescription between a pharmacy that is part of a health maintenance organization (HMO) and pharmacy that is not part of the HMO could be done using HL7 messaging rather than the NCPDP SCRIPT standard version 2023011 RxTransferInitiationRequest, RxTransfer, and RxTransferConfirm transactions (or NCPDP SCRIPT standard version 2017071 RxTransferRequest, RxTransferResponse, and RxTransferConfirm transactions).

Response: The commenter did not provide an explanation for why the commenter requested that we create an exemption from use of the NCPDP SCRIPT standard for prescription transfer transactions between pharmacies, so CMS attempted to investigate the issue raised by the commenter. We found evidence that prescription transfer transactions are at a low level of adoption  23 for NCPDP SCRIPT standard version 2017071 despite the fact that CMS has required the use of NCPDP SCRIPT standard transactions for the transfer of prescriptions for Part D drugs for Part D eligible individuals between pharmacies since January 1, 2020, when NCPDP SCRIPT standard version 2017071 was adopted (83 FR 16635-16638). We did not receive any comments identifying issues with prescription transfer transactions when we proposed the update to NCPDP SCRIPT standard version 2022011 in the December 2022 proposed rule. NCPDP SCRIPT standard version 2022011 contained enhancements to prescription transfer transactions that were not available in NCPDP SCRIPT standard version 2017071, 24 and these enhancements are maintained in NCPDP SCRIPT standard version 2023011. Since we are unable to determine an underlying reason for the low adoption rate of NCPDP SCRIPT standard version 2017071 transactions for prescription transfers between pharmacies, and since we only received one comment requesting an exemption from use of the NCPDP SCRIPT standard version 2023011 for prescription transfers between pharmacies, we decline to create a new exemption and will finalize as proposed the requirement to use RxTransferInitiationRequest (previously named RxTransferRequest), RxTransfer (previously named RxTransferResponse), and RxTransferConfirm transactions for prescription transfers between pharmacies, when such transactions take place electronically.

Comment: We received many comments on EPCS in LTC. Many commenters requested that CMS move the EPCS compliance date for LTC to January 1, 2027 to align with the proposed date by which NCPDP SCRIPT standard version 2023011 would be required. Some commenters stated that NCPDP was unable to create guidance to implement EPCS in LTC using the NCPDP SCRIPT standard version 2017071 because the coding infrastructure did not exist to support the necessary three-way communication between the prescriber, LTC facility, and pharmacy. A commenter indicated that they had successfully implemented EPCS in LTC using NCPDP SCRIPT standard version 2017071 but acknowledged that the enhancements in NCPDP SCRIPT standard version 2023011 would improve the experience for LTC providers.

Response: We thank commenters for their feedback. As we stated in the November 2023 proposed rule, we did not propose a change to the EPCS compliance date for LTC and therefore cannot finalize a change in this final rule. Changes to the CMS EPCS program requirements have been taking place through the annual Medicare Physician Fee Schedule rulemaking process, 25 therefore CMS will consider making any changes through that process. In light of the fact that we are further delaying the required use of NCPDP SCRIPT standard version 2023011 to January 1, 2028, as discussed in section II.A.7. of this final rule, we will consider the feedback received for future rulemaking.

Comment: A commenter suggested embedding the ePA process within the electronic medical record (EMR).

Response: We thank the commenter for being eager to integrate ePA into their practice; however, how the NCPDP SCRIPT and other standards are incorporated into EMR/electronic health record (EHR) design and workflow is outside the scope of this proposal. We refer the commenter to a Request for Information titled “Electronic Prior Authorization Standards, Implementation Specifications, and Certification Criteria” (87 FR 3475), which appeared in the Federal Register on January 24, 2022, and which describes ONC's approach to considering updates to the ONC Health IT Certification Program that could support the availability of ePA in certified health IT for use by health care providers.

After consideration of the public comments we received, we are finalizing our proposal to require, at § 423.160(b)(1), that communication of a prescription and prescription-related information must comply with a standard in 45 CFR 170.205(b) for the transactions listed at § 423.160(b)(1)(i)(A) through (Z), as applicable to the version of the standard in use. We are also finalizing our proposals to consolidate required transactions for prescriptions (§ 423.160(b)(1)(i)(A) through (T)), medication history (§ 423.160(b)(1)(i)(U), and electronic prior authorization (§ 423.160(b)(1)(i)(V) through (Z)) together since all transactions are specific to the NCPDP SCRIPT standard versions ONC has previously adopted or is adopting at 45 CFR 170.205(b) as described in section II.B.8.a. of this final rule.

Taken in conjunction with the standards and expiration date adopted by ONC, as described in section II.B.8.a. of this final rule, § 423.160(b)(1) will require use of NCPDP SCRIPT standard version 2023011, which ONC is adopting at 45 CFR 170.205(b)(2), beginning January 1, 2028, and retire use of NCPDP SCRIPT standard version 2017071, which ONC previously adopted at 45 CFR 170.205(b)(1) and to which it is applying an expiration date of January 1, 2028. As both NCPDP SCRIPT standard version 2017071 and NCPDP SCRIPT standard version 2023011 will be adopted at 45 CFR 170.205(b) and unexpired as of the effective date of this final rule, entities subject to the requirement at § 423.160(b)(1) may use either version of the NCPDP SCRIPT standard during the transition period beginning the effective date of this final rule, and ending December 31, 2027, which is the last day before NCPDP SCRIPT standard version 2017071 will expire for the purposes of HHS use.

In the May 2019 final rule, which implemented the statutory provision at section 1860D-4(e)(2)(D) of the Act, CMS required at § 423.160(b)(7) that Part D plan sponsors implement, by January 1, 2021, one or more electronic RTBT capable of integrating with at least one prescriber's e-prescribing system or EHR to provide prescribers with complete, accurate, timely, clinically appropriate, patient-specific formulary and benefit information. CMS indicated that the formulary and benefit information provided by the tool should include cost, clinically appropriate formulary alternatives, and utilization management requirements because, at that time, an industry standard for RTBTs had not been identified (84 FR 23833). NCPDP has since developed and tested the NCPDP RTPB standard for use with RTBT applications. The NCPDP RTPB standard enables the real-time exchange of information about patient eligibility and patient-specific formulary and benefit information. For a submitted drug product, the NCPDP RTPB standard will indicate coverage status, coverage restrictions, and estimated patient financial responsibility. “Estimated” financial responsibility accounts for the fact that the RTPB transaction transmits the patient's cost sharing at that particular moment in time, which could later change if the claim is processed at a later date or in a different sequence relative to other claims (for example, an RTPB transaction could show a cost sharing that reflects a deductible or particular stage in the Part D benefit which could be different from when the prescription claim is actually processed by the pharmacy if other claims were processed in the interim). The NCPDP RTPB standard also supports providing information on alternative pharmacies and products. In an August 20, 2021 letter to CMS, NCPDP described these features and recommended adoption of NCPDP RTPB standard version 12. 26 Subsequently, in the December 2022 proposed rule, CMS proposed that Part D sponsors' RTBTs comply with NCPDP RTPB standard version 12. In response to that proposal, NCPDP and many other interested parties provided comments to CMS recommending that CMS instead require NCPDP RTPB standard version 13. In their comments on the December 2022 proposed rule, 27 NCPDP listed enhancements in NCPDP RTPB standard version 13 that improve the information communicated between the payer and the prescriber. These enhancements include—

• Addition of a Coverage Status Message to enable the payer to communicate at the product level coverage information that is not codified (that is, values that are not discrete data elements or specific code values);

• Addition of values to the Coverage Restriction Code and data elements to codify information communicated and reduce the number of free text messages on the response;

• Addition of a next available fill date to communicate when the patient is eligible to receive a prescription refill in a discrete field instead of via a free text message;

• Addition of fields to communicate formulary status and preference level of both submitted and alternative products in order to clarify pricing; and

• Addition of data elements on the request transaction to convey the patient's address, state/province, zip/postal code and country to aid in coverage determinations.

Though we withdrew the proposals contained in section III.S. Standards for Electronic Prescribing in the December 2022 proposed rule (87 FR 79548), we considered comments we received on the December 2022 proposed rule when crafting the proposals related to RTBTs discussed in this final rule. A commenter on the December 2022 proposed rule requested that CMS specify that adoption of the NCPDP RTPB standard should not impede what the commenter refers to as the industry standard of sending 4 drugs or 4 pharmacies for pricing in a single transaction. We understand that each transaction between a prescriber EHR and the payer or processor is associated with a degree of latency (that is, the amount of time it takes for the RTBT request to travel from the electronic prescribing system to the payer or processor and return a response with the patient's cost sharing and formulary status information for the submitted drug). In order to populate information on alternative formulary drugs or alternative pharmacies, if one alternative is submitted per transaction, then the latency associated with each transaction becomes additive. If the total latency is too long, then either the RTBT request may “time out” and a response may never be presented to the prescriber, or the prescriber may simply not wait long enough for the RTBT response before moving on through the electronic prescribing process. To illustrate the concept at the center of this issue, if each RTBT transaction is associated with 1 second of latency, then 1 transaction containing the submitted drug, plus 3 alternatives should return the patient-specific cost and formulary status information for all 4 drugs within 1 second. However, if the submitted drug and each alternative are sent as separate transactions, then the total time to return the RTBT response becomes 4 seconds (1 second × 4 transactions). This longer response time increases the likelihood that the prescriber will not wait for the information to populate or that the EHR system will cause the transaction to time out, meaning the patient-specific cost and formulary status information are not presented to the prescriber. CMS takes interest in how adoption of the proposed NCPDP RTPB standard version 13 could alter functionality of RTBTs already in use. CMS created requirements for RTBTs in the absence of an industry-wide standard because of their potential to increase drug price transparency and lower out-of-pocket costs for Medicare Part D enrollees. The impact of RTBTs is contingent on prescribers actually receiving the patient-specific information in the response from the payer. CMS appreciates that this is relatively new technology and that there are multiple factors that contribute to the overall impact of RTBTs in real-world settings. 28 29 30 Nevertheless, we sought comment in the November 2023 proposed rule on the issue raised by the commenter in the December 2022 proposed rule.

We solicited interested parties for their perspective on whether requiring the NCPDP RTPB standard version 13 would limit the ability to send more than one drug or pharmacy per RTBT transaction, and if so, whether the benefit of adopting a standard for prescriber RTBTs in order to enable widespread integration across EHRs and payers outweighs such limitation.

The NCPDP RTPB standard version 13 standard is designed for prescriber, not beneficiary (that is, consumer), RTBTs. CMS emphasizes that we did not propose a required standard for beneficiary RTBTs. Beneficiary RTBTs are made available directly to Part D plan enrollees by the Part D sponsor; therefore, beneficiary RTBT applications do not necessarily interface with an electronic prescribing system or EHR, as prescriber RTBTs must. Consequently, CMS believes that Part D sponsors can retain the flexibility to use beneficiary RTBTs that are based on an available standard or a custom application, as long as the information presented to enrollees meets CMS's requirements codified at § 423.128(d)(4). The requirements for the beneficiary RTBT are discussed in the final rule titled “Medicare and Medicaid Programs; Contract Year 2022 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicaid Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly,” which appeared in the January 19, 2021 Federal Register (86 FR 5864). We declined to propose a standard for beneficiary RTBTs, however we welcomed comments on this topic to consider for future rulemaking.

As discussed in section II.B.8.b. of this rule, ONC proposed to adopt the NCPDP RTPB standard version 13 at 45 CFR 170.205(c)(1). We therefore proposed at § 423.160(b)(5) to require that beginning January 1, 2027, Part D sponsors' prescriber RTBT must comply with a standard in 45 CFR 170.205(c).

We solicited comment on these proposals and the related issues raised. A discussion of the comments received, along with our responses, follows.

Comment: All commenters supported the proposal to require NCPDP RTPB standard version 13 for prescriber RTBTs implemented by Part D sponsors. Several commenters shared their support for CMS's efforts to require a standard to improve transparency and efficiency in the electronic prescribing process for both prescribers and patients. Many commenters expressed support for the standard as a means to move away from limited proprietary RTBTs and move towards widespread access to accurate, detailed, patient-specific cost and coverage information for prescribers at the point of prescribing.

Response: We thank commenters for their support and for their enthusiasm towards utilizing RTBTs generally.

Comment: Several commenters expressed concern over the proposed date of January 1, 2027 when use of NCPDP RTPB standard version 13 would be required.

Response: See section II.A.7. of this rule for discussion of this concern.

Comment: Several commenters shared their thoughts regarding the issue of whether the number of medications that can be sent in a single request transaction in NCPDP RTPB standard version 13 would present a barrier to existing RTBT functionality. One commenter did not believe the standard would pose a barrier and that implementers could still send more than one transaction simultaneously. Another commenter confirmed that there are occasionally latency issues, but that overall enhancements offered by NCPDP RTPB standard version 13 would outweigh any potential latency issues. Commenters noted that even though the initial request only supports 1 drug per transaction, the response provides multiple alternatives, which meets the health care industry's needs.

Response: We thank commenters for their feedback on this topic. We are reassured that requiring NCPDP RTPB standard version 13 for prescriber RTBTs implemented by Part D sponsors will meet the health care industry's needs and will enhance rather than impede existing RTBT functionality.

Comment: Several commenters opined on the specific information communicated in the RTBT response. A commenter requested that CMS address the number and order of pharmacy results based on patient preferences and the frequency and timeliness of Part D plan and RTBT vendor updates to pharmacy network files. The commenter indicated that pharmacies need a dispute process when RTBT responses provide inaccurate pharmacy network status.

Other commenters raised the topic of negotiated prices being displayed in RTBT results, as required for qualifying RTBTs as described in section 119(a) of Subtitle B of Title I, Division CC of CAA, 2021. 31 One commenter supported the use of RTBTs to display a full negotiated price to improve drug cost transparency. Another commenter expressed concern about disclosing negotiated prices, stating that disclosure of such information would have anticompetitive effects and unless CMS and ONC implemented protections to ensure this data is used only to support patient and consumer decision making, there is potential risk of disclosure of negotiated prices to third parties through abuse of RTBT transactions.

Response: With respect to the number and ordering of pharmacy results in a transaction response, the request to address pharmacy ordering in the NCPDP RTPB standard version 13 response transaction results is outside the scope of our proposal. The issue of pharmacy network status not being updated in a timely manner is also outside the scope of the current proposal since it relates to Part D plans' and their vendors' internal operations. The value of the RTBT is to provide patient-specific drug coverage information that accurately reflects what an enrollee would pay if presenting to a particular pharmacy at that moment in time; therefore, an RTBT response that does not return accurate information undermines the utility of and confidence in these tools. Part D sponsors should be ensuring that pharmacy network files are updated in a timely manner so that when an enrollee indicates their preferred pharmacy to their prescriber, the RTBT can return accurate coverage information. Pharmacies can also submit complaints to Medicare for review by CMS if they believe that their network participation status is not being accurately reflected by a Part D sponsor. 32

With respect to display of negotiated prices in the RTBT, the NCPDP RTPB standard version 13 does not include fields to support the exchange of negotiated prices. We refer commenters and interested parties to discussion in the May 2019 final rule, in which we addressed comments received in response to encouraging Part D sponsors to include negotiated prices in RTBT (84 FR 23850). When we finalized the requirement at § 423.160(b)(7) in the May 2019 final rule (which we are renumbering to § 423.160(b)(5) in this final rule) for Part D sponsors to implement, no later than January 1, 2021, one or more RTBTs capable of integrating with at least one prescriber's e-prescribing system or electronic health record, we encouraged, but did not require, Part D sponsors' RTBTs to include negotiated prices.

CAA, 2021 was then enacted after the May 2019 final rule appeared in the Federal Register . Section 119(a) of Subtitle B of Title I of Division CC of the CAA, 2021 added section 1860D-4(o) of the Act to require Part D sponsors to implement one or more RTBTs that meet specified requirements after the Secretary has adopted a standard for RTBTs and at a time determined appropriate by the Secretary. The law specified that RTBTs must be capable of, with respect to a covered Part D drug for a specific Part D enrollee, transmitting cost sharing information and the negotiated price of a drug and its formulary alternatives, among other requirements. Similarly, section 119(b) of Subtitle B of Title I of Division CC of the CAA, 2021 amended the definition of a “qualified electronic health record” in section 3000(13) of the Public Health Service Act to require than a qualified electronic health record include an RTBT capable of transmitting cost sharing information and the negotiated price of a drug and its formulary alternatives, among other requirements.

In a proposed rule titled “Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing” (88 FR 23746), which appeared in the April 18, 2023 Federal Register , ONC discussed limitations of NCPDP RTPB standard version 12, specifically that it does not include fields that support the exchange of negotiated prices. Furthermore, ONC requested comment on pharmacy interoperability functionality within the ONC Health IT Certification Program, including real-time prescription benefit capabilities, in which ONC noted that these fields were not included in the NCPDP RTPB standard due to concerns regarding confidentiality and challenges in determining a negotiated price in real time (88 FR 23850). Section 119 of Subtitle B of Title I of Division CC of the CAA, 2021 grants the Secretary of Health and Human Services the authority to determine the appropriate time, after adopting a standard, to require Part D sponsors to implement and qualified electronic health records to include, respectively, RTBTs meeting the statutory requirements. CMS and ONC will continue to work with other interested parties to determine how and at what time negotiated price information may be made available in RTBTs. At this time, NCPDP RTPB standard version 13 also lacks fields that support the exchange of negotiated prices, but it is the best available standard and otherwise meets the statutory requirements for RTBTs.

Comment: Several commenters provided feedback about beneficiary RTBTs. A commenter recommended that CMS should adopt the same standard for beneficiary RTBTs that is used for prescriber RTBTs since the NCPDP RTPB standard, for example, could be adapted to a consumer-friendly user interface and information that would not be relevant in a beneficiary-facing context could be suppressed. Other commenters noted that the NCPDP RTPB standard was not designed to support a beneficiary RTBT and therefore would not be an appropriate standard for that purpose. A commenter agreed that there is no immediate need to require a standard for beneficiary RTBTs. A commenter emphasized that it is essential for pricing and coverage information displayed in beneficiary RTBTs to match the information provided in prescriber RTBTs, therefore any required standard for beneficiary RTBTs must guarantee that information shared is consistent.

Response: We thank commenters for their input and may consider it to inform future rulemaking.

Comment: A commenter suggested that RTBTs should be embedded within the EMR/EHR workflow.

Response: We thank the commenter for being eager to integrate RTBTs into their practice; however, the manner in which the NCPDP RTPB standard and other standards are incorporated into EMR/EHR design and workflow is outside the scope of this proposal. We refer the commenter to section III.G.2. of the final rule titled “Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing” (89 FR 1192), which appeared in the January 9, 2024 Federal Register , and which describes ONC's approach to considering updates to the ONC Health IT Certification Program that could support the availability of RTBTs in certified health IT for use by health care providers.

Comment: CMS received several comments regarding use of RTBTs. A commenter requested that pharmacists have access to RTBTs. Another commenter requested an exception to the use of RTBTs in LTC or institutional levels of care. A commenter encouraged CMS and ONC to monitor physician utilization of RTBTs to consider the impact in Part D and address barriers to access in future regulation.

Response: With respect to pharmacists accessing RTBTs, nothing in § 423.160, standards for electronic prescribing, limits RTBT access to particular health care providers where consistent with applicable law. Our understanding is that a decision to expand access to RTBTs to non-prescribing providers, such as pharmacists or other members of a clinical care team, would be made by each health system.

With respect to the request for an exemption from the use of RTBTs in LTC or institutional levels of care, we point out that Part D regulations have never imposed a requirement with respect to the utilization of RTBTs by prescribers. Since January 1, 2021, CMS has required that Part D sponsors implement at least one RTBT capable of integrating with at least one prescriber's e-prescribing system or EHR. Our proposal to require that by January 1, 2027, the Part D sponsor RTBT must comply with NCPDP RTPB standard version 13, which ONC is adopting at 45 CFR 170.205(c)(1), does not impose any new requirement on prescribers to integrate RTBTs into their e-prescribing systems or EHRs or to utilize RTBTs.

With respect to monitoring real-world use of RTBTs, we intend to monitor the published literature and will explore other vehicles for monitoring progress in this area as resources permit.

After consideration of the public comments we received, we are finalizing the requirement as proposed at § 423.160(b)(5) that beginning January 1, 2027, Part D sponsors' prescriber RTBT must comply with a standard in 45 CFR 170.205(c), where ONC is adopting the NCPDP RTPB standard version 13 at 45 CFR 170.205(c)(1) as described in section II.B.8.b. of this rule.

The NCPDP Formulary and Benefit (F&B) standard provides a uniform means for prescription drug plan sponsors to communicate plan-level formulary and benefit information to prescribers through electronic prescribing/EHR systems. The NCPDP F&B standard transmits, on a batch basis, data on the formulary status of drugs, preferred alternatives, coverage restrictions (that is, utilization management requirements), and cost sharing consistent with the benefit design (for example, cost sharing for drugs on a particular tier). The NCPDP F&B standard serves as a foundation for other electronic prescribing functions including ePA, real-time benefit check, and specialty medication eligibility when used in conjunction with other standards. 33 NCPDP F&B standard version 3.0 is required for transmitting formulary and benefits information between prescribers and Medicare Part D sponsors, consistent with the text of §§ 423.160(b)(1)(v) and 423.160(b)(5)(iii). In an April 4, 2023 letter to CMS, NCPDP requested that CMS adopt NCPDP F&B standard version 60 to replace NCPDP F&B standard version 3.0. 34 A detailed change log was attached to the letter and is available at the link in the footnote. As described in the letter, compared with NCPDP F&B standard version 3.0, NCPDP F&B standard version 60 includes all of the following major enhancements:

• Normalization of all files (lists), which allows for smaller files and reusability.

• All files have expiration dates.

• Redesigned alternative and step medication files to reduce file sizes and to include support for reason for use (that is, diagnosis).

• Step medication files support a more complex step medication program.

• Updated coverage files to include support for electronic prior authorization and specialty drugs.

• Updated copay files to allow a minimum and maximum copay range without a percent copay and to support deductibles and pharmacy networks.

In its letter to CMS, NCPDP requested mandatory use of NCPDP F&B version 60 24 months after the effective date of a final rule adopting the standard. NCPDP F&B standard version 60 is backwards compatible with NCPDP F&B standard version 3.0, permitting a transition period where both versions of the NCPDP F&B standard may be used simultaneously without the need for entities involved to utilize a translator program.

Following an approach similar to those discussed in sections II.A.4. and II.A.5. of this rule, CMS proposed at § 423.160(b)(3) that electronic transmission of formulary and benefit information between prescribers and Medicare Part D sponsors must either utilize NCPDP F&B standard version 3.0 or comply with a standard in 45 CFR 170.205(u), where ONC proposed to adopt, at 45 CFR 170.205(u)(1), NCPDP F&B standard version 60 as described in section II.B.8.c. of this rule. CMS proposed that beginning January 1, 2027, entities transmitting formulary and benefit information would be required to comply with a standard in 45 CFR 170.205(u) exclusively. As a result of these proposals, there would be a transition period where either NCPDP F&B standard version 3.0 or NCPDP F&B standard version 60 could be used until January 1, 2027. Since ONC did not previously adopt NCPDP F&B standard version 3.0, we would be maintaining adoption of the standard at § 423.160(b)(3) (previously adopted at § 423.160(b)(5)(iii)) and the incorporation by reference of that version in the Part D regulation at § 423.160(c)(1).

We solicited comment on these proposals. A discussion of the comments received, along with our responses, follows.

Comment: All commenters supported the proposal to update NCPDP F&B standard version 3.0 to NCPDP F&B standard version 60. Several commenters acknowledged the complementary role of the NCPDP F&B standard with NCPDP SCRIPT and NCPDP RTPB standards.

Response: We thank commenters for their support.

Comment: Several commenters expressed concern over the proposed date of January 1, 2027 when use of the NCPDP F&B standard version 60 would be required.

Response: For a discussion of the responses to these comments, see section II.A.7. of this rule.

After consideration of the public comments received, we are finalizing the requirement, beginning January 1, 2027 and as proposed at § 423.160(b)(3), for transmission of formulary and benefit information between Medicare Part D sponsors and prescribers to comply with a standard in 45 CFR 170.205(u), where ONC is adopting NCPDP F&B standard version 60. We are finalizing our proposal to retire use of NCPDP F&B standard version 3.0 for transmitting formulary and benefit information between prescribers and Part D sponsors effective January 1, 2027. A transition period where entities will be permitted to use either NCPDP F&B standard version 3.0 (named at § 423.160(b)(3) consistent with the technical changes in this rule) will begin on the effective date of the final rule and continue through December 31, 2026. Beginning January 1, 2027, only a version of the standard adopted for HHS use at 45 CFR 170.205(u) will be permitted for use, which will be NCPDP F&B standard version 60 as described in section II.B.8.c. of this rule.

As discussed in the November 2023 proposed rule, we have received feedback on a number of practical considerations for determining a realistic timeframe to implement new or update existing electronic prescribing standards. We have been informed that organizations generally do not budget for new requirements until a final rule has been published establishing a particular new requirement and, therefore, the timing of when a final rule is finalized relative to budget approval cycles can determine if a requirement can be accounted for in the organization's next annual budget. The health IT industry has indicated to CMS that it requires at least 2 years to design, develop, test, and certify software with trading partners; perform DEA audits for EPCS compliance; and roll out updated software to provider organizations and partners who then must train end users before a transition to a new or updated version of a standard is complete. This account is consistent with NCPDP's requests for up to 24-month implementation timeframes for new standards. 35 36 A commenter on the December 2022 proposed rule requested that CMS either permit 3 years from a final rule before requiring use of a new or updated version of a standard, or use enforcement discretion if requiring use of a new or updated version of a standard less than 3 years from a final rule. CMS will generally aim to provide entities with at least 2 years from when a final rule is finalized. However, we qualify that in some cases less time may be provided if determined to be necessary.

We routinely receive feedback requesting that we do not require the use of new or updated electronic prescribing standards starting on January 1 due to end-of-year “code freezes,” which prohibit updates to internal systems and plan enrollment changes that contribute to a general high workload at the start of a new plan year. We remind entities impacted by the proposed regulatory changes that, consistent with § 423.516, we are prohibited from imposing new, significant regulatory requirements on Part D sponsors midyear. Consistent with the approach discussed in this rule to align CMS' requirements for certain Part D electronic prescribing standards by cross-referencing standards adopted in ONC regulations, CMS and ONC will coordinate to establish appropriate timeframes for updating adopted standards and expiration dates for prior versions of adopted standards. CMS, working with ONC, will consider transition periods longer than 24 months following publication of a final rule to permit a sufficient transition period prior to January 1. Since a new, significant requirement must be effective January 1, a new or updated version of a standard could be required January 1 of the year following 24 months after a final rule is effective. Part D sponsors would need to plan accordingly to completely transition to the updated version of the standard ahead of the January 1 date to meet their internal production calendars.

ONC proposed January 1, 2027, as the date NCPDP SCRIPT standard version 2023011 would be the required version of this standard, as a product of the proposed expiration for NCPDP SCRIPT standard version 2017071 and our proposed cross-reference in § 423.160(b)(1) to a standard in 45 CFR 170.205(b). We proposed the required use of NCPDP F&B standard version 60 and NCPDP RTPB standard version 13 by January 1, 2027, in the text of §§ 423.160(b)(3) and (5) via cross-reference to a standard in 45 CFR 170.205(u) and 170.205(c), respectively. As discussed in sections II.A.4 and II.A.6 of this rule, since NCPDP SCRIPT standard version 2023011 and NCPDP F&B standard version 60 are backwards compatible with NCPDP SCRIPT standard version 2017071 and NCPDP F&B standard version 3.0, respectively, we proposed to permit a transition period when either version could be used. The transition period would begin upon the effective date of the final rule and end on January 1, 2027, which is the expiration date for NCPDP SCRIPT standard version 2017071 proposed by ONC and the date after which CMS proposed to no longer permit use of NCPDP F&B standard version 3.0.

We are also aware that Part D sponsors and the health IT industry are awaiting HHS' final rule on the proposals to update the NCPDP Telecommunication standard from version D.0 to version F6 (87 FR 67638), update the equivalent NCPDP Batch Standard version 15 (87 FR 67639), and implement the NCPDP Batch Standard Pharmacy Subrogation version 10 (87 FR 67640) proposed in the November 2022 Administrative Simplification proposed rule.

Taking all of these proposals into consideration, we asked interested parties to comment on the proposed January 1, 2027 date for the required use of NCPDP SCRIPT standard version 2023011, NCPDP RTPB standard version 13, and NCPDP F&B standard version 60. We noted that the compliance date for the proposals in HHS' November 2022 Administrative Simplification proposed rule was expressly outside the scope of our proposals, and we did not seek comment on it; however, we solicited comments on the feasibility of updating multiple standards simultaneously. A discussion of the comments received, along with our responses, follows.

Comment: Most commenters supported January 1, 2027 as the date for required use of NCPDP SCRIPT standard version 2023011, NCPDP RTPB standard version 13, and NCPDP F&B standard version 60.

Response: We thank commenters for their support.

Comment: Several commenters requested that the date for required use of NCPDP SCRIPT standard version 2023011, NCPDP RTPB standard version 13, and NCPDP F&B standard version 60 be delayed to January 1, 2028. Commenters expressed concern with implementing multiple standards simultaneously at a time when Part D plan and pharmacy benefit manager resources are also focused on system changes related to sections of the Inflation Reduction Act of 2022  37 that impact Part D sponsors and take effect in 2025 and 2026. A commenter indicated that updating standards in the LTC setting are uniquely challenging such that necessary changes could not be implemented before June 30, 2027.

Response: We acknowledge these concerns and seek to strike a balance between advancing standards and providing a reasonable timeline for the health care industry to implement standards successfully. When considering this request, we considered when each standard was last updated and competing needs of the health care industry that each standard addresses. For example, the last time we adopted a newer version of the NCPDP F&B standard was in 2015 (78 FR 74789), whereas we adopted a newer version of the NCPDP SCRIPT standard in 2020 (83 FR 16637). As discussed in section II.A.5. of this rule, we have not previously required a standard for prescriber RTBTs implemented by Part D sponsors, and many commenters supported adoption of a standard in order to enable widespread prescriber access to real-time pharmacy benefit information for their patients at the time of prescribing.

We are concerned that delaying the full and required implementation of all standards until January 1, 2028 would create a scenario where, by the time impacted parties have implemented NCPDP SCRIPT standard version 2023011, NCPDP RTPB standard version 13, and NCPDP F&B standard version 60, NCPDP will have already created newer versions that merit adoption. We are aware of the challenges that are created when cycles of updating standards and adoption in regulation do not occur in tandem. CMS and ONC are open to working with standards development organizations and health care industry representatives to improve the process through which updated standards are incorporated into regulation in the future such that updates can be made in a timely manner.

CMS and ONC have taken the aforementioned factors and comments received into account and are delaying the required use of NCPDP SCRIPT standard version 2023011 to January 1, 2028. We are finalizing this change by finalizing the proposed § 423.160(b)(1), which requires compliance with a standard in 45 CFR 170.205(b), in conjunction with ONC finalizing January 1, 2028 as the expiration date for NCPDP SCRIPT standard version 2017071 in 45 CFR 170.205(b)(1) (as discussed in section II.B.8.a. of this final rule). We are finalizing without modification the requirement to use NCPDP F&B standard version 60 by January 1, 2027 by requiring at § 423.160(b)(3), beginning January 1, 2027, compliance with a standard in 45 CFR 170.205(u), where ONC is adopting NCPDP F&B standard version 60 (as discussed in section II.B.8.c. of this final rule). We are finalizing the requirement to use NCPDP RTPB standard version 13 by January 1, 2027 by requiring at § 423.160(b)(5), beginning January 1, 2027, compliance with a standard in 45 CFR 170.205(c), where ONC is adopting NCPDP RTPB standard version 13 (as discussed in section II.B.8.b. of this final rule). The NCPDP F&B standard has not been updated as recently as the NCPDP SCRIPT standard has been updated from the perspective of Part D requirements. Further, we believe that maintaining the proposed timeline to require use of NCPDP RTPB standard version 13 and exclusive use of NCPDP F&B standard version 60 by January 1, 2027 is warranted in order to support prescribers' access to accurate cost and coverage information at the point of prescribing through use of these complimentary standards.

Comment: A few commenters provided feedback on the transition periods permitted by CMS' proposals. A commenter offered general support for permitting transition periods when backwards compatible versions of standards are available since such periods offer flexibility to the health IT industry and all entities subject to Part D electronic prescribing requirements. Another commenter indicated that if CMS is not specifying the exact dates of transition periods in regulation, there may be confusion among health IT vendors with respect to when system updates can begin. The commenter requested that CMS provide additional communication to the health IT vendor community.

Response: As discussed in section II.A.8. of this rule, we believe, and most commenters agree, that the aligned approach between CMS and ONC will help alleviate compliance challenges for the health IT vendor community, but we acknowledge that our proposed approach to cross-reference ONC regulations in Part D regulations in § 423.160 is a significant change from the previous approach of naming standards and specific transition periods in the Part D regulations. Part D sponsors will need to engage with their health IT vendors following the effective date of this, and future, final rules to plan for the transition to new required standards. We do not generally intend to specify dates for transition periods in regulation in the future, but we will consider additional means of communicating the updated requirements to Part D sponsors, including specifying the dates of transition periods, to minimize any confusion.

After consideration of the public comments received, we are finalizing the requirement for exclusive use of NCPDP SCRIPT standard version 2023011 by January 1, 2028 as a result of ONC modifying the proposed expiration date for NCPDP SCRIPT standard version 2017071 at 45 CFR 170.205(b)(1) as discussed in section II.B.8.a. of this rule. The transition period during which either NCPDP SCRIPT standard version 2017071 or NCPDP SCRIPT standard version 2023011 may be used will begin on July 7, 2024, the effective date of this final rule, and end on December 31, 2027. We are finalizing the requirement for exclusive use of NCPDP F&B standard version 60 by January 1, 2027 as proposed by requiring at § 423.160(b)(3), beginning January 1, 2027, compliance with a standard in 45 CFR 170.205(u), where ONC is adopting NCPDP F&B standard version 60 (as discussed in section II.B.8.c. of this final rule). The transition period during which either NCPDP F&B standard version 3.0 or NCPDP F&B standard version 60 can be used, will begin on July 7, 2024, the effective date of this final rule, and end on December 31, 2026. We are finalizing the required use of NCPDP RTPB standard version 13 for prescriber RTBTs supported by Part D sponsors by January 1, 2027 as proposed by requiring at § 423.160(b)(5), beginning January 1, 2027, compliance with a standard in 45 CFR 170.205(c), where ONC is adopting NCPDP RTPB standard version 13 (as discussed in section II.B.8.b. of this final rule).

We proposed a novel approach to updating e-prescribing standards by cross-referencing Part D e-prescribing requirements with standards, including any expiration dates, adopted by ONC, as discussed in section II.B.5. of this rule. The proposed approach would enable CMS and ONC to avoid misalignment from independent adoption of standards for their respective programs. Updates to the adopted standards would impact requirements for both programs at the same time, ensure consistency, and promote alignment for providers, payers, and health IT developers participating in and supporting the same prescription transactions. A discussion of the comments received on our proposal, along with our responses, follows.

Comment: The majority of commenters supported the proposed aligned approach and agreed that it would alleviate compliance challenges for developers and generally help promote consistency and coordination among all parties implementing new standards.

Response: We thank commenters for their support.

Comment: A few commenters did not support or expressed concerns about the aligned approach. A commenter raised the point that Part D sponsors are not required to use certified health IT; therefore, the approach to cross-reference standards adopted by ONC in Part D regulation could create confusion about the scope of ONC requirements. A few commenters emphasized that CMS and ONC need to assure process alignment across agencies when ONC adopts new standards so that CMS representatives continue to be involved in determining the new requirements and timing. A commenter noted that there should be a notification process, such as a Federal Register announcement or Health Plan Management System (HPMS) memorandum to inform Part D sponsors if ONC plans to update the adopted standards in the future.

Response: We thank commenters for sharing their concerns and recommendations. We agree that the success of the proposed aligned approach with cross-references is contingent on collaboration and communication among CMS, ONC, and the entities that are subject to CMS and ONC requirements. CMS and ONC will continue to work together on future rulemaking to ensure that future standards that are adopted meet the needs of the respective programs. We will consider the means to ensure that the relevant entities are notified of proposed rules as they are published in the Federal Register for public comment and are notified of final rules that finalize relevant proposals. As described in section II.A.11. of this rule, in order for CMS to require use of standards in § 423.160 by cross citation to 45 CFR 170.205(b), (c), and (u), those standards must be published in full in the Federal Register or CFR. Therefore, CMS will be required to incorporate by reference in § 423.160 the standards that ONC updates at 45 CFR 170.205(b), (c), and (u). We believe the incorporation by reference in § 423.160 will help to mitigate confusion regarding the standards that are applicable to Part D requirements. We acknowledge that since the expiration dates of standards will be located in ONC regulations, CMS will consider a targeted announcement to Part D sponsors via HPMS memorandum or email. CMS will continue to participate in NCPDP task groups to ensure that Part D sponsors, pharmacies, and prescribers can continue to coordinate with CMS on issues and challenges related to electronic prescribing standards in Part D. In turn, CMS will work closely with ONC to ensure that any concerns related to electronic prescribing standards in Part D are considered in future rulemaking.

Comment: A commenter recommended that CMS should maintain its own standards version advancement process (SVAP) that is focused on the needs of health plans, since the ONC Health IT Certification Program is focused on providers and health IT vendors.

Response: We thank the commenter for their recommendation. ONC's SVAP permits health IT developers to voluntarily update health IT products certified under the ONC Health IT Certification Program (Certification Program) to newer versions of adopted standards as part of the “Real World Testing” Condition and Maintenance of Certification requirement at 45 CFR 170.405. 38 Although the ONC SVAP permits the use of newer versions of adopted standards in its ONC Health IT Certification Program, this flexibility does not extend to the Part D program requirements for electronic prescribing. Entities to which the requirements at § 423.160 apply must only use the standard version or versions specified in regulation. We did not propose an equivalent process to ONC's SVAP process for Part D sponsors' electronic prescription drug programs but will take the idea into consideration for future rulemaking.

Comment: A commenter recommended that CMS and ONC consider aligning federal requirements for electronic prescribing standards with state requirements or to encourage states to follow standards and timelines adopted at the federal level.

Response: The recommendation is outside the scope of our proposals. State regulators may refer to federal regulations to inform requirements related to electronic prescribing standards at the state level.

After consideration of the public comments we received, we are finalizing our proposals to update e-prescribing standards by cross-referencing Part D e-prescribing requirements with standards, including any expiration dates, adopted by ONC, as discussed in section II.B.5. of this rule.

We proposed to revise the Part D requirements to indicate that eligibility transactions must comply with 45 CFR 162.1202. The requirements for eligibility transactions currently codified at § 423.160(b)(3)(i) and (ii) name the Accredited Standards Committee X12N 270/271-Health Care Eligibility Benefit Inquiry and Response, Version 5010, April 2008, ASC X12N/005010x279 and the NCPDP Telecommunication Standard Specification, Version D, Release 0 (Version D.0), August 2007, and equivalent NCPDP Batch Standard Batch Implementation Guide, Version 1, Release 2 (Version 1.2), January 2006 supporting Telecommunications Standard Implementation Guide, Version D, Release 0 (Version D.0), August 2007. We adopted these standards to align with those adopted at 45 CFR 162.1202, pursuant to the final rule titled “Health Insurance Reform; Modifications to the Health Insurance Portability and Accountability Act (HIPAA) Electronic Transaction Standards,” which appeared in the January 16, 2009 Federal Register (74 FR 3326).

The November 2022 Administrative Simplification proposed rule proposes to update the HIPAA standards used for eligibility transactions (87 FR 67634). We therefore proposed to update the Part D regulation by proposing, at § 423.160(b)(2), that eligibility inquiries and responses between the Part D sponsor and prescribers and between the Part D sponsor and dispensers would have to comply with the applicable HIPAA regulation in 45 CFR 162.1202, as opposed to naming standards independently, which would ensure, should the HIPAA standards for eligibility transactions be updated as a result of HHS rulemaking or in the future, that the Part D regulation would be synchronized with the required HIPAA standards. We foresee no immediate impact of this proposed change since the HIPAA regulation at 45 CFR 162.1202 currently identifies the same standards as those named in the Part D regulation at § 423.160(b)(3)(i) and (ii), but we believe establishing a cross-reference would help avoid potential future conflicts and mitigate potential compliance challenges for the health care industry and enforcement challenges for HHS.

Thus, we proposed to delete existing paragraphs §§ 423.160(b)(3)(i) and (ii) and modify paragraph § 423.160(b)(2) (as renumbered per the technical revisions discussed in section II.A.10. of this rule) to require that eligibility transactions must comply with 45 CFR 162.1202.

We solicited comment on these proposals. A discussion of the comments received, along with our responses, follows.

Comment: All comments received on this proposal were supportive. Several commenters agreed that the cross-reference to HIPAA regulation will alleviate compliance challenges for those required to comply with Part D and HIPAA regulations.

Response: We thank commenters for their support.

Comment: A commenter requested that CMS institute a notification process to ensure that entities subject to Part D requirements are made aware of updates when HHS updates the required standards for eligibility transactions.

Response: Consistent with 45 CFR 162.100, the regulations at 45 CFR 162.1202 apply to covered entities as defined at 45 CFR 160.103. Entities subject to Part D regulations are among those covered entities. 39 We believe that HHS has the means to reach covered entities when it undertakes rulemaking and when new requirements are finalized. Therefore, we do not believe CMS would need to issue separate notice.

After consideration of the public comments we received, we are finalizing, in § 423.160(b)(2), the cross-reference to 45 CFR 162.1202 for eligibility transactions as proposed.

In the spirit of alignment with ONC's approach to adopting standards, we reviewed § 423.160 in its entirety and identified areas where we could reorganize text throughout this section. We do not believe we should continue to list historical requirements that are no longer relevant and have resulted in repetitive content being added to the regulations. We proposed removing reference to old effective dates (for example, “After January 1, 2009 . . .” at § 423.160(a)(3)(ii)). Additionally, certain exemptions have long since expired. For example, at § 423.160(a)(3)(iv), entities transmitting prescriptions or prescription-related information where the prescriber is required by law to issue a prescription for a patient to a non-prescribing provider (such as a nursing facility) that in turn forwards the prescription to a dispenser have not been exempt from using the SCRIPT standard since November 1, 2014.

We proposed a correction at § 423.160(a)(3)(iii), where regulation text refers to prescriptions and prescription-related information transmitted “internally when the sender and the beneficiary are part of the same legal entity.” The exemption currently at § 423.160(a)(3)(iii) was previously codified at § 423.160(a)(3)(ii) as “Entities may use either HL7 messages or the NCPDP SCRIPT Standard to transmit prescriptions or prescription-related information internally when the sender and the recipient are part of the same legal entity . . .” as finalized in the November 2005 final rule, which codified the foundation standards for Medicare Part D electronic prescription drug programs (70 FR 67594). Paragraph § 423.160(a)(ii) was redesignated as paragraph § 423.160(a)(iii) subsequent to changes made in the final rule titled “Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule, and Other Part B Payment Policies for CY 2008; Revisions to the Payment Policies of Ambulance Services Under the Ambulance Fee Schedule for CY 2008; and the Amendment of the E-Prescribing Exemption for Computer Generated Facsimile Transmissions,” (hereinafter referred to as “the November 2007 final rule”) which appeared in the November 27, 2007 Federal Register (72 FR 66222). There is no indication of intent in the November 2007 final rule to change the wording in § 423.160(a)(iii) when it was redesignated, nor can we find evidence of when this paragraph may have been altered in subsequent rules. Therefore, we believe the word “recipient” was inadvertently changed to “beneficiary” in the distant past, and we proposed to change this back to “recipient.”

Paragraphs § 423.160(a)(1)-(2) already indicate that the entities listed must comply with the applicable standards in § 423.160(b); therefore, the language currently at § 423.160(b)(1), “Entities described in paragraph (a) of this section must comply with the following adopted standards for transactions under this section,” is redundant. We proposed to remove it from the text of § 423.160(b)(1). Moreover, §§ 423.160(b)(1)(i) through (iv) and 423.160(b)(2)(i) through (iii) contain long-outdated requirements going back to the start of the electronic prescribing program in Medicare Part D. We proposed to delete references to outdated requirements so that the regulation text would include only relevant and applicable requirements. Transition periods would no longer be specifically spelled out as starting at a particular date (historically, 6 months after the effective date of a final rule). Rather, the transition period would begin as of the effective date of a final rule effectuating a change from one version of a standard to a new version and would last until the prior version of the standard is expired, as proposed to be codified in ONC regulation, or until the date specified in Part D regulation. For versions of standards adopted by ONC, CMS will consider the necessary transition period when working with ONC to establish the appropriate expiration date for prior versions of standards in rulemaking. This would align the Part D approach with the approach that ONC has used in its own regulations.

As currently organized, separate sections for “Prescription” at § 423.160(b)(2), “Medication History” at § 423.160(b)(4), and “Electronic Prior Authorization” at § 423.160(b)(8) have resulted in multiple versions of the NCPDP SCRIPT standard, and relevant transactions, being repeated in these sections. Because §§ 423.160(a)(1) and (2) state that the entities listed must comply “with the applicable standards in paragraph (b),” we believe that we could group the functions in paragraph (b) according to the standard used for those functions to avoid repetition. Therefore, we proposed to combine “Prescriptions, electronic prior authorization, and medication history” at § 423.160(b)(1), which would require the use of the NCPDP SCRIPT standard version or versions as proposed via cross-reference to ONC regulations. We proposed to delete §§ 423.160(b)(4) and (8). We proposed to relocate the ePA transactions previously listed at § 423.160(b)(8)(i)(A) through (D) to § 423.160(b)(1)(i)(V) through (Y). We proposed to delete reference to versions of the NCPDP F&B standard, currently codified at §§ 423.160(b)(5), 423.160(b)(5)(i), and 423.160(b)(5)(ii), that are no longer applicable. The remaining paragraphs in § 423.160(b) would be renumbered such that § 423.160(b)(2) would refer to eligibility, § 423.160(b)(3) would refer to formulary and benefits, § 423.160(b)(4) would refer to provider identifier, and § 423.160(b)(5) would refer to real-time benefit tools.

We proposed to delete standards incorporated by reference at § 423.160(c) that are: no longer applicable (that is, are associated with outdated requirements that we proposed to delete); or are already incorporated by reference by HHS at 45 CFR 162.920. The standards incorporated by reference at §§ 423.160(c)(1)(i), (ii), (iv), and (v) would no longer be applicable, and we proposed to delete them. The standards for eligibility transactions currently incorporated by reference at §§ 423.160(c)(1)(iii) and 423.160(c)(2) have already been incorporated by reference by HHS at 45 CFR 162.920. We proposed to delete these incorporations by reference in light of our proposal in section II.A.9. of this rule to indicate that entities would be required to comply with 45 CFR 162.1202. That citation indicates where the applicable standards have been incorporated by reference in HHS regulations.

We believe these changes would improve the overall readability of the section. With the exception of changes described in sections II.A.4., II.A.5., II.A.6., and II.A.9., we do not intend for technical changes to alter current requirements.

We solicited comment on these proposals. We received no comments on our proposed technical changes and the correction and therefore are finalizing them as proposed.

The Office of the Federal Register (OFR) has regulations concerning incorporation by reference (IBR) at 1 CFR part 51. If the regulations reference a standard, either in general or by name, in another section, IBR approval is required. In order for CMS to require use of standards in § 423.160 by cross citation to 45 CFR 170.205(b), (c), and (u), those standards must be published in full in the Federal Register or CFR. Therefore, CMS must incorporate by reference the materials referenced in the proposals in sections II.A.4., II.A.5., and II.A.6. of this rule which cross cite standards in ONC regulations.

For a final rule, agencies must discuss in the preamble to the final rule ways that the materials the agency proposes to incorporate by reference are reasonably available to interested parties or how the agency worked to make the materials reasonably available. Additionally, the preamble to the final rule must summarize the materials. See section II.B.10. of this final rule for summaries of the standards CMS and ONC are incorporating by reference.

Consistent with those requirements, CMS has established procedures to ensure that interested parties can review and inspect relevant materials. The proposals related to the Part D electronic prescribing standards have relied on the following materials, which we proposed to incorporate by reference where specified—

• NCPDP SCRIPT Standard, Implementation Guide Version 2017071, (Approval Date for American National Standards Institute [ANSI]: July 28, 2017), which is currently incorporated by reference at § 423.160(c)(1)(vii). We proposed to renumber this incorporation by reference as § 423.160(c)(2);

• NCPDP SCRIPT Standard, Implementation Guide Version 2023011, (Approval Date for ANSI: January 17, 2023). We proposed to incorporate by reference at § 423.160(c)(3);

• NCPDP Real-Time Prescription Benefit Standard, Implementation Guide Version 13, (Approval Date for ANSI: May 19, 2022). We proposed to incorporate by reference at § 423.160(c)(4);

• NCPDP Formulary and Benefits Standard, Implementation Guide, Version 3, Release 0 (Version 3.0), (Approval Date for ANSI: January 28, 2011), which is currently incorporated by reference at § 423.160(c)(1)(vi). We proposed to renumber this incorporation by reference as § 423.160(c)(1); and

• NCPDP Formulary and Benefit Standard, Implementation Guide Version 60, (Approval Date for ANSI: April 12, 2023). We proposed to incorporate by reference at § 423.160(c)(5).

NCPDP members may access these materials through the member portal at https://standards.ncpdp.org/Access-to-Standards.aspx. Non-NCPDP members may obtain these materials for information purposes by contacting CMS at 7500 Security Boulevard, Baltimore, Maryland 21244; by calling (410) 786-4132 or (877) 267-2323 (toll free); or emailing PartDPolicy@cms.hhs.gov.

We received no comments on these proposals and therefore are finalizing the incorporation by reference provisions with typographical and technical changes to § 423.160(c).

The following standards are already approved for the sections in which they appear in the amendatory text of this rule: NCPDP SCRIPT Standard, Implementation Guide Version 2017071 and NCPDP Formulary and Benefit Standard, Implementation Guide, Version 3, Release 0 (Version 3.0).

We received a few general comments that were not specific to any of the particular proposals. A discussion of the comments received, along with our responses, follows.

Comment: A few commenters suggested that HHS should require payers outside Part D to use the same standards required in Part D.

Response: We thank commenters for their suggestions acknowledging the role of CMS in advancing the adoption of updated standards through our requirements for Part D. We appreciate the fact that commenters believe that the standards required for electronic prescribing in Part D would provide value to electronic prescribing processes in other areas.

Comment: A commenter indicated that CMS should monitor the implementation progress of the required standards to assure there are no disruptions in care during the transition to, or as a result of, the implementation of the new versions of the standards.

Response: CMS monitors complaints received and will investigate complaints that suggest that required standards are not implemented appropriately.

In consideration of the public comments received and the discussion in sections II.A.4. though II.A.11. of this rule, we are finalizing all of the following:

• Requiring in § 423.160(b)(1) that Part D sponsors, prescribers, and dispensers of Part D drugs for Part D eligible individuals comply with a standard in 45 CFR 170.205(b) for communication of a prescription or prescription-related information. Under paragraph 45 CFR 170.205(b), ONC is adopting NCPDP SCRIPT standard version 2023011 in 45 CFR 170.205(b)(2) and finalizing an expiration date of January 1, 2028 for NCPDP SCRIPT standard version 2017071 in 45 CFR 170.205(b)(1). A transition period will begin on the effective date of the final rule, when either version of the NCPDP SCRIPT standard may be used. The transition period will end on December 31, 2027 because as of January 1, 2028, NCPDP SCRIPT standard version 2017071 will expire for the purposes of HHS use, as described in section II.B.8.a. of this rule. Starting January 1, 2028, NCPDP SCRIPT standard version 2023011 will be the only version of the NCPDP SCRIPT standard available for HHS use and for purposes of the Medicare Part D electronic prescribing program.

• Requiring in § 423.160(b)(5), beginning January 1, 2027, prescriber RTBTs implemented by Part D sponsors to comply with a standard in 45 CFR 170.205(c), where ONC is adopting NCPDP RTPB standard version 13, as described in section II.B.8.b. of this rule.

• Requiring in § 423.160(b)(3), beginning January 1, 2027, transmission of formulary and benefit information between prescribers and Medicare Part D sponsors to comply with a standard in 45 CFR 170.205(u), where ONC is adopting NCPDP F&B standard version 60, and retiring use of NCPDP F&B standard version 3.0 for transmitting formulary and benefit information between prescribers and Part D sponsors. This requirement includes a transition period beginning on the effective date of the final rule, and ending December 31, 2026, where entities will be permitted to use either NCPDP F&B standard version 3.0 (named at § 423.160(b)(3) consistent with the technical changes in this rule) or NCPDP F&B standard version 60, adopted at 45 CFR 170.205(u). Starting January 1, 2027, only a version of the NCPDP F&B standard adopted for HHS use at 45 CFR 170.205(u) will be permitted for use in Part D electronic prescription drug program, which will be NCPDP F&B standard version 60 as discussed in section II.B.8.c. of this rule.

• Cross-referencing in § 423.160(b)(2) standards adopted for eligibility transactions in HIPAA regulations at 45 CFR 162.1202 for requirements related to eligibility inquiries and responses.

• Making multiple technical changes to the regulation text throughout § 423.160 for clarity by removing requirements and incorporations by reference that are no longer applicable or redundant, reorganizing existing requirements, and correcting a technical error.

• Incorporating by reference NCPDP SCRIPT Standard, Implementation Guide Version 2023011 at § 423.160(c)(3); NCPDP Real-Time Prescription Benefit Standard, Implementation Guide Version 13 at § 423.160(c)(4); and NCPDP Formulary and Benefit Standard, Implementation Guide Version 60, at § 423.160(c)(5).

In this section, ONC proposed to adopt standards for electronic prescribing and related activities on behalf of HHS under the authority in section 3004 of the Public Health Service Act (42 U.S.C. 300jj-14). ONC proposed these standards for adoption by HHS as part of a nationwide health information technology infrastructure that supports reducing burden and health care costs and improving patient care. ONC proposed to adopt these standards on behalf of HHS in one location within the Code of Federal Regulations for HHS use, including by the Part D Program as proposed in section II.A. of this final rule. These proposals reflected a unified approach across the Department to adopt standards for electronic prescribing (e-prescribing) activities that have previously been adopted separately by CMS and ONC under independent authorities. This approach is intended to increase alignment across HHS and reduce regulatory burden for interested parties subject to program requirements that incorporate these standards.

In the Medicare Program; Contract Year 2024 Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, Medicare Parts A, B, C, and D Overpayment Provisions of the Affordable Care Act and Programs of All-Inclusive Care for the Elderly; Health Information Technology Standards and Implementation Specifications” (hereinafter referred to as the “December 2022 proposed rule”), which appeared in the Federal Register on December 27, 2022 (87 FR 79552 through 79557), we proposed to adopt NCPDP SCRIPT standard version 2022011 and NCPDP Real-Time Prescription Benefit (RTPB) standard version 12, as well as related proposals. As discussed in the November 2023 proposed rule, we withdrew the proposals in sections III.T. and III.U. of the December 2022 proposed rule (87 FR 79552 through 79557). We issued a series of new proposals in the November 2023 proposed rule that took into consideration the feedback we received from commenters on the December 2022 proposed rule and further built on these proposals (88 FR 78499 through 78503). Additionally, summaries of the standards we proposed to adopt and subsequently incorporate by reference in the Code of Federal Regulations can be found below in section II.B.10. of this rule.

The Health Information Technology for Economic and Clinical Health Act (HITECH Act), Title XIII of Division A and Title IV of Division B of the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5), was enacted on February 17, 2009. The HITECH Act amended the Public Health Service Act (PHSA) and created “Title XXX—Health Information Technology and Quality” (Title XXX) to improve health care quality, safety, and efficiency through the promotion of health IT and exchange of electronic health information (EHI). Subsequently, Title IV of the 21st Century Cures Act (Pub. L. 114-255) (hereinafter referred to as the “Cures Act”) amended portions of the HITECH Act by modifying or adding certain provisions to the PHSA relating to health IT.

Section 3001 of the PHSA directs the National Coordinator for Health Information Technology (National Coordinator) to perform duties in a manner consistent with the development of a nationwide health information technology infrastructure that allows for the electronic use and exchange of information. Section 3001(b) of the PHSA establishes a series of core goals for development of a nationwide health information technology infrastructure that—

• Ensures that each patient's health information is secure and protected, in accordance with applicable law;

• Improves health care quality, reduces medical errors, reduces health disparities, and advances the delivery of patient-centered medical care;

• Reduces health care costs resulting from inefficiency, medical errors, inappropriate care, duplicative care, and incomplete information;

• Provides appropriate information to help guide medical decisions at the time and place of care;

• Ensures the inclusion of meaningful public input in such development of such infrastructure;

• Improves the coordination of care and information among hospitals, laboratories, physician offices, and other entities through an effective infrastructure for the secure and authorized exchange of health care information;

• Improves public health activities and facilitates the early identification and rapid response to public health threats and emergencies, including bioterror events and infectious disease outbreaks;

• Facilitates health and clinical research and health care quality;

• Promotes early detection, prevention, and management of chronic diseases;

• Promotes a more effective marketplace, greater competition, greater systems analysis, increased consumer choice, and improved outcomes in health care services; and

• Improves efforts to reduce health disparities.

Section 3004 of the PHSA identifies a process for the adoption of health IT standards, implementation specifications, and certification criteria, and authorizes the Secretary to adopt such standards, implementation specifications, and certification criteria. As specified in section 3004(a)(1) of the PHSA, the Secretary is required, in consultation with representatives of other relevant Federal agencies, to jointly review standards, implementation specifications, and certification criteria endorsed by the National Coordinator under section 3001(c) of the PHSA and subsequently determine whether to propose the adoption of any grouping of such standards, implementation specifications, or certification criteria. The Secretary is required to publish all determinations in the Federal Register .

Section 3004(b)(3) of the PHSA, which is titled “Subsequent Standards Activity,” provides that the Secretary shall adopt additional standards, implementation specifications, and certification criteria as necessary and consistent with the schedule published by the Health IT Advisory Committee (hereinafter referred to as the “HITAC”). As noted in the final rule, “2015 Edition Health Information Technology (Health IT) Certification Criteria, 2015 Edition Base Electronic Health Record (EHR) Definition, and ONC Health IT Certification Program Modifications,” which appeared in the October 16, 2015 Federal Register , we consider this provision in the broader context of the HITECH Act and the Cures Act to grant the Secretary the authority and discretion to adopt standards, implementation specifications, and certification criteria that have been recommended by the HITAC and endorsed by the National Coordinator, as well as other appropriate and necessary health IT standards, implementation specifications, and certification criteria (80 FR 62606).

Under the authority outlined in section 3004(b)(3) of the PHSA, the Secretary may adopt standards, implementation specifications, and certification criteria as necessary even if those standards have not been recommended and endorsed through the process established for the HITAC under section 3002(b)(2) and (3) of the PHSA. Moreover, while HHS has traditionally adopted standards and implementation specifications at the same time as adopting certification criteria that reference those standards, the Secretary's authority under section 3004(b)(3) of the PHSA is not limited to adopting standards or implementation specifications at the same time certification criteria are adopted.

Finally, the Cures Act amended the PHSA by adding section 3004(c), which specifies that in adopting and implementing standards under section 3004, the Secretary shall give deference to standards published by standards development organizations and voluntary consensus-based standards bodies.

The HITECH Act established two Federal advisory committees, the HIT Policy Committee (hereinafter referred to as the “HITPC”) and the HIT Standards Committee (hereinafter referred to as the “HITSC”). Each was responsible for advising the National Coordinator on different aspects of health IT policy, standards, implementation specifications, and certification criteria.

Section 4003(e) of the Cures Act amended section 3002 of the PHSA and replaced the HITPC and HITSC with one committee, the HITAC. After that change, section 3002(a) of the PHSA establishes that the HITAC advises and recommends to the National Coordinator standards, implementation specifications, and certification criteria relating to the implementation of a health IT infrastructure, nationally and locally, that advances the electronic access, exchange, and use of health information. The Cures Act specifically directed the HITAC to advise on two areas: (1) a policy framework to advance an interoperable health information technology infrastructure (section 3002(b)(1) of the PHSA); and (2) priority target areas for standards, implementation specifications, and certification criteria (section 3002(b)(2) of the PHSA).

For the policy framework, as described in section 3002(b)(1)(A) of the PHSA, the Cures Act tasked the HITAC with providing recommendations to the National Coordinator on a policy framework for adoption by the Secretary consistent with the Federal Health IT Strategic Plan under section 3001(c)(3) of the PHSA. In February of 2018, the HITAC made recommendations to the National Coordinator for the initial policy framework  40  and subsequently published a schedule in the Federal Register and an annual report on the work of the HITAC and ONC to implement and evolve that framework. 41 For the priority target areas for standards, implementation specifications, and certification criteria, section 3002(b)(2)(A) of the PHSA identified that in general, the HITAC would recommend to the National Coordinator, for purposes of adoption under section 3004 of the PHSA, standards, implementation specifications, and certification criteria and an order of priority for the development, harmonization, and recognition of such standards, specifications, and certification criteria. In October of 2019, the HITAC finalized recommendations on priority target areas for standards, implementation specifications, and certification criteria. 42

Historically, the ONC Health IT Certification Program and the Part D Program have maintained complementary policies of aligning health IT certification criteria and associated standards related to electronic prescribing, medication history, and electronic prior authorization for prescriptions. While CMS and ONC have worked closely together to ensure consistent adoption of standards through regulatory actions, we recognize that the practice of different HHS components conducting parallel adoption of the same standards may result in additional regulatory burden and confusion for interested parties. For instance, due to discrepancies between regulatory timelines, adoption of the NCPDP SCRIPT standard version 2017071 in different rules (respectively, the ONC Cures Act final rule (85 FR 25642); and the Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program final rule, which appeared in the April 16, 2018 Federal Register (83 FR 16440)) led to a period where ONC had to exercise special enforcement discretion in the ONC Health IT Certification Program. 43 Given these concerns, ONC and CMS proposals in the December 2022 proposed rule (87 FR 79552 through 79557) reflected a new approach to alignment of standards under which ONC proposed to adopt, on behalf of HHS, the NCPDP SCRIPT standard version 2022011 and the NCPDP RTPB standard version 12 in a single Code of Federal Regulations location at 45 CFR 170.205, where CMS proposed to cross-reference these standards for requirements in the Part D program.

Additional discussion of this approach can be found in the December 2022 proposed rule (87 FR 79552 through 79557) and CMS's discussion in sections II.A.3. through II.A.7. of this final rule. We note that this rule also reflects an aligned approach with CMS to adoption of health IT standards for e-prescribing and related purposes. We believe our adoption of these standards in a single CFR location for HHS use will help to address concerns around alignment across HHS programs.

Comment: Commenters supported the approach reflected in our proposed adoption of standards and alignment within a single CFR location, which they stated would reduce burden and cost, improve care, and improve coordination.

Response: We thank commenters for their support.

For a summary of past standards adoption activities under section 3004 of the PHSA intended to ensure alignment for electronic prescribing and related activities across the ONC Health IT Certification Program and the Part D Program, we refer readers to the December 2022 proposed rule (87 FR 79553). For a summary of previous notice-and-comment rulemaking related to formulary and benefit management capabilities in the ONC Health IT Certification Program, we refer readers to the “Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing” proposed rule (hereinafter referred to as the “HTI-1 Proposed Rule”) (88 FR 23853 through 23854).

ONC's Interoperability Standards Advisory (ISA) supports the identification, assessment, and public awareness of interoperability standards and implementation specifications that can be used by the health care industry to address specific interoperability needs. 44 The ISA is updated on an annual basis based on recommendations received from public comments and subject matter expert feedback. This public comment process reflects ongoing dialogue, debate, and consensus among industry interested parties when more than one standard or implementation specification could be used to address a specific interoperability need.

ONC currently identifies the standards adopted in this section within the ISA as available standards for a variety of potential use cases. The NCPDP SCRIPT standard version 2023011, the NCPDP RTPB standard version 13, and the NCPDP Formulary and Benefit (F&B) standard version 60 are currently identified in sections of the ISA including the “Pharmacy Interoperability”  45 and “Administrative Transactions—Non-Claims.”  46 We encourage interested parties to review the ISA to better understand key applications for the implementation specifications proposed for adoption in this rule.

Consistent with section 3004(b)(3) of the PHSA and the efforts, as previously described, to evaluate and identify standards for adoption, we proposed to adopt the following standards in 45 CFR 170.205(b)(2), (c)(1), and (u)(1), on behalf of the Secretary, to support the continued development of a nationwide health information technology infrastructure as described under section 3001(b) of the PHSA, and to support Federal alignment of standards for interoperability and health information exchange. Specifically, we proposed to adopt the following standards:

• NCPDP SCRIPT Standard, Implementation Guide, Version 2023011.

• NCPDP Real-Time Prescription Benefit (RTPB) Standard, Implementation Guide, Version 13.

• NCPDP Formulary and Benefit (F&B) Standard, Implementation Guide, Version 60.

In addition to comments on the individual proposals below, we also invited comments on whether there are alternative versions, including any newer versions, of these or other standards that we should consider for adoption for HHS use. In particular, we stated we were interested in, and would consider for adoption in a final rule, any newer version of the proposed standard(s) that may correct any unidentified errors or clarify ambiguities that would support successful implementation of the standard(s) and the interoperability of health IT.

ONC has previously adopted three versions of the NCPDP SCRIPT standard in 45 CFR 170.205. Most recently, we adopted NCPDP SCRIPT standard version 2017071 in the ONC Cures Act final rule to facilitate the transfer of prescription data among pharmacies, prescribers, and payers (85 FR 25678).

The updated NCPDP SCRIPT standard version 2023011 includes important enhancements relative to NCPDP SCRIPT standard version 2017071. Enhancements have been added to support electronic prior authorization functions as well as electronic transfer of prescriptions between pharmacies. NCPDP SCRIPT standard version 2023011 also includes functionality that supports a 3-way transaction among prescriber, facility, and pharmacy, which will enable electronic prescribing of controlled substances in the long-term care (LTC) setting. 47

We proposed to adopt NCPDP SCRIPT standard version 2023011 in 45 CFR 170.205(b)(2), replacing NCPDP SCRIPT standard version 10.6 which is currently in 170.205(b)(2). We proposed to incorporate NCPDP SCRIPT standard version 2023011 by reference in 45 CFR 170.299. Regarding NCPDP SCRIPT standard version 2017071, we proposed to revise the regulatory text in 45 CFR 170.205(b)(1) to specify that adoption of this standard will expire on January 1, 2027. We stated that if these proposals were finalized, this would mean that both the 2017071 and 2023011 versions of the NCPDP SCRIPT standard would be available for HHS use from the effective date of a final rule until January 1, 2027. On and after January 1, 2027, we stated that only the 2023011 version of the NCPDP SCRIPT standard would be available for HHS use, for instance, where use of a standard in 45 CFR 170.205(b) is required. We refer readers to section II.A.4. of this final rule, where CMS discusses its proposal at § 423.160(b)(1) to require use of a standard in 45 CFR 170.205(b) for communication of a prescription or prescription-related information to fulfill requirements for prescriptions, electronic prior authorization, and medication history.

We requested comment on these proposals and received several comments. A discussion of these comments, along with our responses follows.

Comment: Commenters supported the proposed adoption of the NCPDP SCRIPT standard version 2023011, stating that it would improve patient safety, avoid mistakes and errors, and improve information-sharing. Commenters noted that the NCPDP SCRIPT standard version 2023011 includes important enhancements to support the electronic transfer of prescriptions between pharmacies.

Response: We thank commenters for their support.

Comment: Some commenters agreed with January 1, 2027 as the proposed date by which NCPDP SCRIPT standard version 2023011 would be the only available version of the NCPDP SCRIPT standard for use, due to the proposed expiration of NCPDP SCRIPT standard version 2017071 on that date, while other commenters suggested that we delay the date to January 1, 2028. A few commenters noted that January 1 (the start of the year) can also be difficult with end of year work and suggested a middle of the year date instead.

Response: We recognize that, as a result of CMS finalizing their proposals in section II.A.4. of this final rule, which cross-reference our standards adoption proposals in this section, Part D sponsors will need to make a series of changes to different systems in order to ensure compliance with the required standards. Taking into consideration comments on Part D requirements related to the other standards we have proposed for adoption, we agree with CMS that a staggered approach to these updates will allow Part D sponsors to ensure successful adoption and implementation.

Thus, we are modifying our proposal in 45 CFR 170.205(b)(1) for the expiration of NCPDP SCRIPT standard version 2017071 from January 1, 2027, to instead be January 1, 2028. As a result of this modified final policy, the requirements for Part D sponsors finalized in section II.A.4. of this final rule, which cross-reference the standards in 45 CFR 170.205(b), will allow for an additional transitional year before Part D sponsors must only use NCPDP SCRIPT standard version 2023011.

We disagree with commenters that a middle of the year date should be used as a compliance date, as January 1 follows many other CMS and ONC program compliance dates, and we believe it is important to maintain consistency in our alignment with these programs. As discussed in the November 2023 proposed rule (88 FR 78498), our proposed expiration date for the NCPDP SCRIPT standard version 2017071 would allow for a period when a requirement to use a standard in 45 CFR 170.205(b) would allow for the use of either version of the NCPDP SCRIPT standard adopted at that location. Thus, implementers including Part D sponsors that must use a standard in 45 CFR 170.205(b) have flexibility to determine the most appropriate time to update their systems, until January 1, 2028.

After consideration of the public comments we received, we are finalizing our proposal to adopt NCPDP SCRIPT standard version 2023011 in 45 CFR 170.205(b)(2) and incorporate it by reference in 45 CFR 170.299. We are modifying our proposal to revise the regulatory text in 45 CFR 170.205(b)(1) with respect to the proposed expiration date for NCPDP SCRIPT standard version 2017071 and finalizing that this standard will expire on January 1, 2028. After this date, only NCPDP SCRIPT standard version 2023011 will be available for HHS use. We refer readers to section II.A. of this final rule for additional information where CMS discusses its final policies at § 423.160(b)(1) to require use of a standard in 45 CFR 170.205(b) for communication of a prescription or prescription-related information to fulfill the requirements for prescriptions, electronic prior authorization, and medication history.

The NCPDP RTPB standard version 13 enables the exchange of coverage status and estimated patient financial responsibility for a submitted product and pharmacy and identifies coverage restrictions and alternatives when they exist. See section II.A.5. of this final rule for a description of NCPDP RTPB standard functionality and enhancements of NCPDP RTPB standard version 13 relative to NCPDP RTPB standard version 12.

In the November 2023 proposed rule, we noted that our proposal to adopt this standard supports the requirements of Division CC, Title I, Subtitle B, section 119 of the Consolidated Appropriations Act, 2021 (CAA), Public Law 116-260, which required sponsors of Medicare prescription drug plans to implement a real-time benefit tool (RTBT) that meets technical standards named by the Secretary, in consultation with ONC. In addition, section 119(b) of the CAA amended the definition of a “qualified electronic health record” in section 3000(13) of the PHSA to specify that a “qualified electronic health record” must include or be capable of including a RTBT. We stated that ONC intends to address this provision in future rulemaking for the ONC Health IT Certification Program and would ensure alignment with the proposed NCPDP RTPB standard version 13, if finalized, and related proposals in the Part D program where appropriate.

We also noted that the HITAC had previously addressed real-time prescription benefit standards, consistent with its statutory role to recommend standards. In 2019, the HITAC accepted the recommendations included in the 2018 report of the Interoperability Priorities Task Force, including recommendations to continue to monitor standards then being developed for real-time prescription benefit transactions, and, when the standards are sufficiently validated, to require EHR vendors to provide functionality that integrates real time patient-specific prescription benefit checking into the prescribing workflow. 48 In early 2020, the National Committee on Vital and Health Statistics (NCVHS) and HITAC convened another task force, the Intersection of Clinical and Administrative Data (ICAD) Task Force, which was charged with convening industry experts and producing recommendations related to electronic prior authorizations. The task force report was presented to HITAC in November 2020  49 and discussed the NCPDP RTPB standard as an important tool for addressing administrative transactions around prescribing.

We proposed in 45 CFR 170.205(c) to add a new section heading for “Real-time prescription benefit.” We also proposed to adopt the NCPDP RTPB standard version 13  50 in 45 CFR 170.205(c)(1) and to incorporate this standard by reference in 45 CFR 170.299. We referred readers to section III.B.5. of the November 2023 proposed rule, where CMS proposed at 42 CFR 423.160(b)(5) to require Part D sponsors' RTBTs to comply with a standard in 45 CFR 170.205(c) by January 1, 2027, to fulfill the requirements for real-time benefit tools. As previously noted, we stated that ONC would consider proposals to require use of this standard to support RTBT functionality in the ONC Health IT Certification Program, consistent with section 119 of the CAA, in future rulemaking.

We requested comment on these proposals and received several comments. A discussion of these comments, along with our responses follows.

Comment: Commenters supported our proposal to adopt the NCPDP RTPB standard version 13, noting that use of this standard is necessary to provide clinicians and patients with transparency about coverage requirements and cost information for informed decision making.

Response: We thank commenters for their support.

After consideration of the public comments received, we are finalizing our proposal to add a new section heading at 45 CFR 170.205(c), “Real-time prescription benefit.” We are also finalizing our proposal to adopt the NCPDP RTPB standard version 13  51 in 45 CFR 170.205(c)(1) and incorporate it by reference in 45 CFR 170.299. We refer readers to section II.A. of this rule for additional information on CMS's finalized policy at § 423.160(b)(5) to require Part D sponsors' RTBTs to comply with a standard in 45 CFR 170.205(c) by January 1, 2027, to fulfill the requirements for real-time benefit tools.

The NCPDP F&B standard version 60  52 provides a uniform means for prescription drug plan sponsors to communicate plan-level formulary and benefit information to prescribers through electronic prescribing/EHR systems. The NCPDP F&B standard transmits, on a batch basis, data on the formulary status of drugs, preferred alternatives, coverage restrictions (that is, utilization management requirements), and cost sharing consistent with the benefit design (for example, cost sharing for drugs on a particular tier). The NCPDP F&B standard serves as a foundation for other electronic prescribing transactions including ePA, real-time benefit check, and specialty medication eligibility when used in conjunction with other standards.

We proposed to add a new paragraph heading at 45 CFR 170.205(u), “Formulary and benefit.” We proposed to adopt the NCPDP F&B standard version 60 at 45 CFR 170.205(u)(1) and to incorporate this standard by reference in 45 CFR 170.299. We referred readers to section III.B.6. of the November 2023 proposed rule, where CMS proposed at § 423.160(b)(3) to require, by January 1, 2027, use of a standard in 45 CFR 170.205(u) by Part D sponsors to fulfill the requirements for exchange of formulary and benefit information with prescribers.

We requested comment on these proposals and received several comments. A discussion of these comments, along with our responses, follows.

Comment: Commenters supported the adoption of the NCPDP F&B standard version 60, noting that this standard provides numerous enhancements and a uniformed means for prescription drug plan sponsors to communicate plan-level formulary and benefit information to prescribers through prescribing/EHR systems on a batch basis.

Response: We thank commenters for their support.

After consideration of the public comments we received, we are finalizing our proposal to add a new paragraph heading at 45 CFR 170.205(u), “Formulary and benefit.” We are also finalizing our proposal to adopt the NCPDP F&B standard version 60 at 45 CFR 170.205(u)(1) and to incorporate this standard by reference in 45 CFR 170.299. We refer readers to section II.A. of this rule for additional information on policies CMS is finalizing at 42 CFR 423.160(b)(3) to require, by January 1, 2027, use of a standard in 45 CFR 170.205(u) for transmitting formulary and benefit information between prescribers and Medicare Part D sponsors.

In the November 2023 proposed rule, we did not propose new or revised certification criteria based on the proposed adoption of standards in the proposed rule. We noted that section 119 of the CAA does not require ONC to adopt certification criteria for real-time prescription benefit capabilities at the same time as a standard is adopted by HHS. We therefore proposed to adopt the NCPDP Real-Time Prescription Benefit standard for HHS use and as previously discussed, stated that ONC would address new or revised certification criteria referencing the standard, if finalized, in separate rulemaking. We noted that ONC published a Request for Information in the HTI-1 Proposed Rule seeking information related to potential establishment of a “real-time prescription benefit” criterion (88 FR 23853 through 23854). We also noted that ONC would continue to collaborate with CMS to ensure that any future proposals in the ONC Health IT Certification Program continue to advance alignment with program requirements under the Part D Program.

We believe the approach reflected in the standards we have adopted in this final rule will support Federal alignment and coordination of Federal activities with adopted standards and implementation specifications for a wide range of systems, use cases, and data types within the broad scope of health information exchange. Historically, State, Federal, and local partners have leveraged the standards adopted by ONC on behalf of HHS to inform program requirements, technical requirements for grants and funding opportunities, and systems implementation for health information exchange. We believe the adoption of these standards will support HHS partners in setting technical requirements and advancing the use of innovative health IT solutions for electronic prescribing and related activities.

The Office of the Federal Register has established requirements for materials (for example, standards and implementation specifications) that agencies incorporate by reference in the Code of Federal Regulations (79 FR 66267; 1 CFR 51.5(a)). Specifically, 1 CFR 51.5(a) requires agencies to discuss, in the preamble of a final rule, the ways that the materials they incorporate by reference are reasonably available to interested parties or how they worked to make those materials reasonably available to interested parties; and summarize, in the preamble of the final rule, the material they incorporate by reference.

To make the materials reasonably available, we provide a uniform resource locator (URL) for the standards and implementation specifications. In many cases, these standards and implementation specifications are directly accessible through the URLs provided. In instances where they are not directly available, we note the steps and requirements necessary to gain access to the standard or implementation specification. In most of these instances, access to the standard or implementation specification can be gained through no-cost (monetary) participation, subscription, or membership with the applicable standards developing organization (SDO) or custodial organization. In certain instances, where noted, access requires a fee or paid membership. As an alternative, a copy of the standards may be viewed for free at the U.S. Department of Health and Human Services, Office of the National Coordinator for Health Information Technology, 330 C Street SW, Washington, DC 20201. Please call (202) 690-7171 in advance to arrange inspection.

The National Technology Transfer and Advancement Act (NTTAA) of 1995 (15 U.S.C. 3701 et seq. ) and the Office of Management and Budget (OMB) Circular A-119 require the use of, wherever practical, technical standards that are developed or adopted by voluntary consensus standards bodies to carry out policy objectives or activities, with certain exceptions. The NTTAA and OMB Circular A-119 provide exceptions to selecting only standards developed or adopted by voluntary consensus standards bodies, namely when doing so would be inconsistent with applicable law or otherwise impractical. We have followed the NTTAA and OMB Circular A-119 in adopting standards and implementation specifications and note that the technical standards adopted in 45 CFR 170.205 in this final rule were developed by NCPDP, which is an ANSI-accredited, not-for-profit membership organization using a consensus-based process for standards development.

As required by 1 CFR 51.5(a), we provide summaries of the standards we have adopted and incorporate by reference in the Code of Federal Regulations. We also provide relevant information about these standards and implementation specifications in the preamble where these standards are adopted. We are finalizing revisions to § 170.299(k) with the following standards as well as typographical and technical revisions:

• NCPDP SCRIPT Standard, Implementation Guide, Version 2023011, (Approval Date for ANSI: January 17, 2023) URL: https://standards.ncpdp.org/Access-to-Standards.aspx.

Access requires registration, a membership fee, a user account, and a license agreement to obtain a copy of the standard.

Summary: SCRIPT is a standard created to facilitate the transfer of prescription data between pharmacies, prescribers, and payers. The current standard supports transactions regarding new prescriptions, prescription changes, renewal requests, prescription fill status notification, and prescription cancellation. Enhancements have been added for drug utilization review/use (DUR/DUE) alerts and formulary information as well as transactions to relay medication history and for a facility to notify a pharmacy of resident information. Enhancements have been added to support electronic prior authorization functions as well as electronic transfer of prescriptions between pharmacies.

• NCPDP Real-Time Prescription Benefit Standard, Implementation Guide, Version 13, (Approval Date for ANSI: May 19, 2022) URL: https://standards.ncpdp.org/Access-to-Standards.aspx.

Access requires registration, a membership fee, a user account, and a license agreement to obtain a copy of the standard.

Summary: The NCPDP Real-Time Prescription Benefit Standard Implementation Guide is intended to meet the industry need within the pharmacy services sector to facilitate the ability for pharmacy benefit payers/processors to communicate to providers and to ensure a consistent implementation of the standard throughout the industry. The NCPDP Real-Time Prescription Benefit standard enables the exchange of patient eligibility, product coverage, and benefit financials for a chosen product and pharmacy, and identifies coverage restrictions, and alternatives when they exist.

• NCPDP Formulary and Benefit Standard, Implementation Guide, Version 60, (Approval Date for ANSI: April 12, 2023) URL: https://standards.ncpdp.org/Access-to-Standards.aspx.

Access requires registration, a membership fee, a user account, and a license agreement to obtain a copy of the standard.

Summary: This NCPDP Formulary and Benefit Standard Implementation Guide is intended to provide a standard means for pharmacy benefit payers (including health plans and pharmacy benefit managers) to communicate formulary and benefit information to prescribers via technology vendor systems.

The following standard is already approved for the section in which it appears in the amendatory text of this rule: NCPDP SCRIPT Standard, Implementation Guide Version 2017071.

Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq. ), we are required to provide 60-day notice in the Federal Register and solicit public comment before a “collection of information,” as defined under 5 CFR 1320.3(c) of the PRA's implementing regulations, is submitted to the Office of Management and Budget (OMB) for review and approval. To fairly evaluate whether an information collection requirement (ICR) should be approved by OMB, section 3506(c)(2)(A) of the 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.

In our December 2022 (CMS-4201-P; RIN 0938-AU96; 87 FR 79452) and November 2023 (CMS-4205-P; RIN 0938-AV24; 88 FR 78476) proposed rules, we solicited public comment on each of the aforementioned issues for the following information collection requirements.

In sections II.A. and II.B. of this final rule, we discuss proposals, which we are finalizing in this rule, to update the standards to be used for electronic transmission of prescriptions and prescription-related information for Part D covered drugs for Part D eligible individuals. This includes: (1) adopting the National Council for Prescription Drug Plans (NCPDP) SCRIPT standard version 2023011 at 45 CFR 170.205(b)(2), and, after a transition period, retiring use of NCPDP SCRIPT standard version 2017071 for communication of a prescription or prescription-related information supported by Part D sponsors; (2) requiring use of NCPDP RTPB standard version 13 for prescriber RTBTs implemented by Part D sponsors; and (3) requiring use of NCPDP Formulary and Benefit (F&B) standard version 60, at 45 CFR 170.205(u), and retiring use of NCPDP F&B standard version 3.0 for transmitting formulary and benefit information between prescribers and Part D sponsors. These proposals update existing standards that are exempt from the PRA, as explained in this section.

The initial electronic prescribing standards for the Medicare Part D program were adopted in the final rule “Medicare Program; Standards for E-Prescribing Under Medicare Part D and Identification of Backward Compatible Version of Adopted Standard for E-Prescribing and the Medicare Prescription Drug Program (Version 8.1)” (hereinafter referred to as the “Initial Standards final rule”), which appeared in the April 4, 2008 Federal Register (73 FR 18918). The Initial Standards final rule implemented the first update to the electronic prescribing foundation standards in the Part D program that had been adopted in the final rule “Medicare Program; E-Prescribing and the Prescription Drug Program” (hereinafter referred to as the “Foundation Standards final rule”), which appeared in the November 7, 2005 Federal Register (70 FR 67568). The Initial Standards final rule adopted the updated the NCPDP SCRIPT standard version 8.1 and retired the previous NCPDP SCRIPT standard version 5.0. With respect to ICRs in the Initial Standards final rule, CMS explained that the burden associated with the requirement that Part D sponsors must support and comply with the adopted electronic prescribing standards when prescriptions and prescription-related information is transmitted electronically for covered Part D drugs, prescribed for Part D eligible individuals is exempt from the PRA as stipulated under 5 CFR 1320.3(b)(2) because use of standards for electronic prescribing constitutes a usual and customary business practice (73 FR 18931).

Subsequent rules that have updated electronic prescribing standards in the Medicare Part D program also considered such practice as exempt from the PRA. Specifically—

• The “Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule, DME Face-to-Face Encounters, Elimination of the Requirement for Termination of Non-Random Prepayment Complex Medical Review and Other Revisions to Part B for CY 2013” final rule, which appeared in the November 16, 2012, Federal Register (77 FR 68892). This final rule updated the electronic prescribing standards in Medicare Part D from NCPDP SCRIPT standard version 8.1 to version 10.6;

• The “Medicare Program; Revisions to Payment Policies Under the Physician Fee Schedule, Clinical Laboratory Fee Schedule & Other Revisions to Part B for CY 2014” final rule, which appeared in the Federal Register on December 10, 2013 (78 FR 74230). This final rule updated the electronic prescribing standards in Medicare Part D from NCPDP F&B standard version 1.0 to version 3.0; and

• The “Medicare Program; Contract Year 2019 Policy and Technical Changes to the Medicare Advantage, Medicare Cost Plan, Medicare Fee-for-Service, the Medicare Prescription Drug Benefit Programs, and the PACE Program” final rule, which appeared in the Federal Register on April 16, 2018 (83 FR 16640). This final rule updated the electronic prescribing standards in Medicare Part D from NCPDP SCRIPT standard version 10.6 to version 2017071.

Once electronic prescribing has been enabled through electronic prescribing systems or EHRs it is a usual and customary business practice that health IT and EHR vendors will update the systems regularly in order to meet the business needs of their customers utilizing electronic prescribing. Updating systems with new versions of electronic prescribing standards is one such update, and NCPDP SCRIPT is the industry standard for electronic prescribing of drugs covered under a pharmacy benefit. CMS does not require that pharmacies accept electronic prescriptions, but pharmacies that do would likewise have their systems updated by their health IT software providers as a usual and customary business practice to meet their business needs. We believe the burden associated with using the NCPDP SCRIPT standard version 2023011 will be the same as using NCPDP SCRIPT standard version 2017071 for transmission of prescription and prescription-related information. We do not anticipate that updating NCPDP SCRIPT standard version 2017071 to NCPDP SCRIPT standard version 2023011 will result in costs that are beyond those associated with usual and customary business practices. CMS does not require prescribers to utilize formulary and benefit information in the process of electronic prescribing, but for prescribers who do, we believe the burden associated with using NCPDP F&B standard version 60 will be the same as using NCPDP F&B standard version 3.0. We do not anticipate that updating NCPDP F&B standard version 3.0 to NCPDP F&B standard version 60 will result in costs that are beyond those that are usual and customary business practices. We believe this to be true for health IT and EHR vendors serving the business needs of their customers and Part D sponsors who likewise have a business interest in facilitating prescribers' ability to select preferred formulary products at the time of prescribing.

Part D sponsors have been required to support RTBTs since January 1, 2021, as finalized in the “Modernizing Part D and Medicare Advantage to Lower Drug Prices and Reduce Out-of-Pocket Expenses” final rule, which appeared in the Federal Register on May 23, 2019 (84 FR 23832). Because Part D sponsors have invested in the hardware, software, and connectivity necessary to utilize RTBTs, we believe that adopting the NCPDP RTPB standard version 13 will impose de minimis cost on the industry and that costs will be largely offset by the advantages and efficiencies associated with interoperability that a standard brings. CMS does not require prescribers to utilize RTBTs, but for prescribers who do utilize RTBTs, we believe that the burden associated with using an RTBT that does not use a standard will be the same as using an RTBT that uses NCPDP RTPB standard version 13.

The operations associated with updates to standards finalized in this rule are analogous to the operations associated with updates to standards in the prior rules described. Therefore, the provisions in sections II.A. and II.B. of this rule are exempt from the requirements of the PRA.

We received no comments on the proposed ICR narrative in the December 2022 or November 2023 proposed rules. Therefore, we are finalizing the ICR narrative as is.

We have examined the impact 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), Executive Order 14094 entitled “Modernizing Regulatory Review” (April 6, 2023), the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the 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 14094 entitled “Modernizing Regulatory Review” (hereinafter, the Modernizing E.O.) amends section 3(f) of Executive Order 12866 (Regulatory Planning and Review). The amended section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action that is likely to result in a rule: (1) having an annual effect on the economy of $200 million or more in any 1 year, or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, territorial, or tribal governments or communities; (2) creating a serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising legal or policy issues for which centralized review would meaningfully further the President's priorities or the principles set forth in the Executive Order.

A Regulatory Impact Analysis (RIA) must be prepared for regulatory actions that are significant under section 3(f)(1). Based on our estimates, OMB's Office of Information and Regulatory Affairs (OIRA) has determined this rulemaking is not significant per section 3(f)(1) as measured by the $200 million or more in any one year threshold, since we calculated no burden associated with the provisions in this rule. Pursuant to Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 (also known as the Congressional Review Act), OIRA has also determined that this rule does not meet the criteria set forth in 5 U.S.C. 804(2).

The RFA requires agencies to consider the effect of any provision on small entities and present alternatives, if necessary, for regulatory relief to those small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. The entities affected by this final rule include Part D sponsors, prescribers, and dispensers (that is, pharmacies) that electronically transmit prescriptions or prescription-related information for Part D drugs for Part D-eligible individuals, directly or through an intermediary. As indicated in section III.B. of this rule, the information collection requirements for the provisions in this rule are exempt from the PRA because the requirement to utilize a standard for electronic prescribing is classified as a usual and customary business practice. Consequently, we have not calculated burden estimates for entities affected by this final rule, regardless of size. We are not preparing an analysis for the RFA because we have determined, and the Secretary certifies, that this final rule will not have a significant economic impact on a substantial number of small entities.

In addition, section 1102(b) of the Act requires us to prepare an RIA if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area for Medicare payment regulations and has fewer than 100 beds. We are not preparing an analysis for section 1102(b) of the Act because we have determined, and the Secretary certifies, 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 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 2024, that threshold is approximately $183 million. This rule will have no consequential effect on state, local, or tribal governments or on the private sector.

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. Since this regulation does not impose any costs on state or local governments, the requirements of Executive Order 13132 are not applicable.

In accordance with the provisions of Executive Order 12866, this final rule was reviewed by the Office of Management and Budget.

Chiquita Brooks-LaSure, Administrator of the Centers for Medicare & Medicaid Services, approved this document on May 6, 2024.

For the reasons set forth in the preamble, the Centers for Medicare & Medicaid Services amends 42 CFR part 423 and the Department of Health and Human Services amends 45 CFR part 170 as set forth below:

This document announces that, on May 29, 2024, OMB approved the information collection requirements relating to § 10.350(d) contained in the Commission's Order FCC 23-88, published at 88 FR 86824, December 15, 2023. The OMB Control Number is 3060-1126. The Commission publishes this document as an effective date of the rule. If you have any comments on the burden estimates listed below, or how the Commission can improve the collections and reduce any burdens caused thereby, please contact Nicole Ongele, Federal Communications Commission, 45 L Street NE, Washington, DC 20554. Please include OMB Control Number 3060-1126, in your correspondence. The Commission will also accept your comments via email at PRA@fcc.gov.

As required by the Paperwork Reduction Act of 1995 (44 U.S.C.3507), the FCC is notifying the public that it received OMB approval on May 29, 2024, for the information collection requirements contained in 47 CFR 10.350(d) of the Commission's rules.

Under 5 CFR part 1320, an agency may not conduct or sponsor a collection of information unless it displays a current, valid OMB Control Number.

No person shall be subject to any penalty for failing to comply with a collection of information subject to the Paperwork Reduction Act that does not display a current, valid OMB Control Number. The OMB Control Number is 3060-1126.

The foregoing notification is required by the Paperwork Reduction Act of 1995, Public Law 104-13, October 1, 1995, and 44 U.S.C. 3507.

The total annual reporting burdens and costs for the respondents are as follows:

OMB Control Number: 3060-1126.

OMB Approval Date: May 29, 2024.

OMB Expiration Date: May 31, 2027.

Title: Testing and Logging Requirements for Wireless Emergency Alerts.

Form Number: N/A.

Respondents: Business or other for-profit; Not-for-profit institutions; State, Local, or Tribal Government.

Number of Respondents and Responses: 76 respondents; 429,020 responses.

Estimated Time per Response: 3.375 hours.

Frequency of Response: Monthly and on occasion reporting requirements and record keeping requirement.

Obligation to Respond: Required to obtain or retain benefits. Statutory authority for this collection is contained in sections 47 U.S.C. 151, 152, 154, 301, 303, 307, 309, 316, 403, 554, 606, 1201, 1202, 1203, 1204, and 1206 of the Communications Act of 1934.

Total Annual Burden: 119,121 hours.

Total Annual Cost: No cost.

Needs and Uses: The Commission adopted requirements for Participating CMS Providers to log the basic attributes of alerts they receive at their Alert Gateway, to maintain those logs for at least 12 months, to make those logs available upon request to the Commission and Federal Emergency Management Agency (FEMA), and to emergency management agencies that offer confidentiality protection at least equal to that provided by Federal FOIA. The Commission also requires Participating CMS Providers to disclose information regarding their capabilities for geo-targeting Alert Messages initiated by that emergency management agency, and information regarding the results of WEA Performance and Public Awareness Testing authorized in 47 CFR 10.350(d). Prior to conducting a WEA Performance and Public Awareness Test, an alerting authority must: (1) conduct outreach by notifying the public in advance of the test that no emergency is occurring; (2) include in the actual test message that the alert is, in fact, “only a test;” (3) coordinate the test among Participating CMS Providers that serve the geographic area targeted by the test, State, local, and Tribal emergency authorities, relevant State Emergency Communications Committees and first responder organizations, and (4) provide notice to the public in widely accessible formats that the test is only a test, not a warning about an actual emergency.

These recordkeeping and reporting requirements have potential to increase emergency managers' confidence that WEA will work as intended when needed. This increased confidence in system availability encourages emergency management agencies that do not currently use WEA to become authorized. These reporting and recordkeeping requirements also help to ensure a fundamental component of system integrity against which future iterations of WEA can be evaluated. Without records that can be used to describe the quality of system integrity, and the most common causes of message transmission failure it would be difficult to evaluate how any changes to WEA may effect system integrity.

FMCSA organizes this final rule as follows:

To view any documents mentioned as being available in the docket, go to https://www.regulations.gov/docket/FMCSA-2023-0268/document and choose the document to review. To view comments, click this final rule, then click “Browse Comments.” If you do not have access to the internet, you may view the docket online by visiting Dockets Operations at U.S. Department of Transportation, 1200 New Jersey Avenue SE, Washington, DC 20590-0001, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. To be sure someone is there to help you, please call (202) 366-9317 or (202) 366-9826 before visiting Dockets Operations.

Under 49 United States Code (U.S.C.) 14504a, the UCR Plan and the 41 States participating in the UCR Agreement collect fees from motor carriers, motor private carriers of property, brokers, freight forwarders, and leasing companies. The UCR Plan and Agreement are administered by a 15-member board of directors (UCR Plan Board), which is comprised of 14 members appointed from the participating States and the industry, and the Deputy Administrator of FMCSA, who is a statutory member. Revenues collected are allocated to the participating States and the UCR Plan.

In accordance with 49 U.S.C. 14504a(d)(7)(A)(ii) and (f)(1)(E)(i), the UCR Plan provides fee adjustment recommendations to the Secretary of Transportation (Secretary) when revenue collections result in a shortfall or surplus from the amount authorized by statute. If the required payments to the States and the cost of administering the UCR Plan exceed the amount in the depository, the UCR Plan must collect additional fees in subsequent years to cover the shortfall (49 U.S.C. 14504a(f)(1)(E)(i)). If there are excess funds after payments to the States and for administrative costs, they are retained in the UCR Plan's depository, and fees in subsequent fee years must be reduced as required by 49 U.S.C. 14504a(h)(4). These two distinct statutory provisions are recognized in the fee adjustment recommended by the UCR Plan and adopted in this final rule to increase, by an average of 25 percent, the annual registration fees established pursuant to the UCR Agreement for the 2025 registration year and subsequent years. 1

The changes in this final rule increase the fees paid by motor carriers, motor private carriers of property, brokers, freight forwarders, and leasing companies to the UCR Plan and the participating States. These fees are considered by the Office of Management and Budget (OMB) Circular A-4, Regulatory Analysis, as transfer payments, not costs. Transfer payments are payments from one group to another that do not affect total resources available to society. Therefore, transfers are not considered in the monetization of societal costs and benefits of rulemakings. Despite the classification of fees as transfer payments, the Agency acknowledges that motor carriers, motor private carriers of property, brokers, freight forwarders, and leasing companies will incur a greater burden as a result of this fee increase.

This rulemaking adjusts the annual UCR registration fees, as authorized by 49 U.S.C. 14504a. Section 14504a provides that the revenues collected from the fees should not exceed the maximum annual revenue entitlements distributed to the 41 participating States plus the amount established for administrative costs associated with the UCR Plan and Agreement. The UCR Agreement is an interstate agreement (as so defined in 49 U.S.C. 14504a(a)(8)) entered into by 41 participating States in accordance with the provisions of 49 U.S.C. 14504a(e)(1) and (2). The statute provides for the UCR Plan to ask the Secretary to make an adjustment within a reasonable range when the annual revenues are insufficient to provide the revenues to which the participating States are entitled (49 U.S.C. 14504a(f)(1)(E)(i)).

In addition, 49 U.S.C. 14504a(h)(4) states that any excess funds from previous registration years held by the UCR Plan in its depository, after distribution to the States and for payment of administrative costs, shall be retained and the fees charged shall be reduced by the Secretary accordingly.

The UCR Plan must also obtain DOT approval to revise the total revenue to be collected, in accordance with 49 U.S.C. 14504a(d)(7). However, no changes in the revenue allocations to the participating States were recommended by the UCR Plan in accordance with 49 U.S.C. 14504a(g)(4) and therefore, no changes have been authorized by this rulemaking.

The Secretary also has broad rulemaking authority in 49 U.S.C. 13301(a) to carry out 49 U.S.C. 14504a, which is part of 49 U.S.C. subtitle IV, part B. Authority to administer these statutory provisions has been delegated to the FMCSA Administrator by 49 CFR 1.87(a)(2) and (7).

The two revised and new sections in this final rule work in concert to adjust the applicability of an existing requirement and impose a new requirement and are therefore not severable. This is so because if the increased fees for 2025 in new 49 CFR 367.50 were to be set aside, then the existing fee levels in 49 CFR 367.40 must remain in effect to provide funds to allow the participating States to receive their statutory revenue entitlements during 2025. While the 2024 fees would not be sufficient to fully cover the 2025 State statutory entitlements and administrative costs, that revenue would be necessary to provide at least some portion of the statutory entitlements due to participating States.

On January 9, 2024, FMCSA published in the Federal Register an NPRM titled “Fees for the Unified Carrier Registration Plan and Agreement” (89 FR 1053; see also Docket No. FMCSA-2023-0268). The NPRM proposed amending regulations for the annual registration fees States collect from motor carriers, motor private carriers of property, brokers, freight forwarders, and leasing companies for the UCR Plan and Agreement for the 2025 registration year and subsequent registration years. The fees for the 2025 registration year were proposed to be increased from the fees for 2024 by approximately 25 percent overall, with varying increases between $9 and $9,000 per entity, depending on the applicable fee bracket. The fee increases will produce revenues of $13 million that will enable the UCR Plan to provide the funds for the State revenue entitlements by covering the shortfalls in revenues resulting from decreases in the fees the prior two registration years, which averaged 37.3 percent. 2 The proposal was based upon a recommendation from the UCR Plan.

FMCSA requested public comments concerning the NPRM for 30 days ending February 8, 2024. By that date, 66 unique comments were received. Three comments were submitted by trade associations: the National Owner Operators Association; the National Propane Gas Association (NPGA), and the Small Business in Transportation Coalition (SBTC). Two comments were erroneously added to the docket and were withdrawn, as they addressed issues pertaining to a different rulemaking. Sixty small motor carriers and individuals (many of them anonymous) submitted comments. The UCR Plan submitted a comment responding to the issues raised by the comments of SBTC.

Comments: Many commenters posed questions about the UCR fee, its purpose, and rationale behind the increase. For instance, an anonymous commenter claimed that the NPRM and supporting documents published in the docket “do not explain to what end the money is used” beyond the fact that the UCR's allocated reserves have been depleted. The commenter further noted that the structure of decreasing and increasing fees, or “see-sawing of the tax,” as the commenter described, is not very clear. Another commenter suggested there should be a maximum percentage change in the fee that the UCR Plan can implement.

FMCSA Response: UCR fees are used by participating States for motor carrier safety programs and enforcement, or the administration of the UCR Plan and UCR agreement (49 U.S.C. 14504a(e)(1)(B)). When each of the participating States joined the UCR Agreement, the statute required them to submit to FMCSA a State plan that, among other matters, demonstrates that an amount at least equal to the revenue derived by the State from the UCR agreement shall be used for those motor carrier safety programs and enforcement, or the administration of the UCR Plan and UCR agreement (49 U.S.C. 14504a(e)(1)(B)). The statute also gives primacy to the need to set the fees at a level that ensures that each of the participating States receive the revenues to which they are entitled (49 U.S.C. 14504a(f)(1)(E)(i) and (g)(4)). The adjustment in the fees to be paid to the UCR Plan for distribution to the participating States is necessary to accomplish this statutory objective.

FMCSA believes this upward adjustment is within a reasonable range, in accordance with the provisions of 49 U.S.C. 14504a(e)(1) and (2). This adjustment to the 2025 registration year provides the required $13 million in revenue allocations to the participating States and the UCR Plan. Any amount short of these adjustments would impede proper operations of motor carrier safety programs, enforcement, or the administration of the UCR Plan and UCR agreement. The Agency notes the rare occurrence of this upward adjustment, which has only previously occurred once, over a decade ago. This upward adjustment, an approximately 25 percent increase, follows two years of reductions in fees affecting the 2023 and 2024 registration years, averaging a 37.3 percent decrease in fees, as well as steady, unmodified collections from 2010 to 2017. The Agency believes this recalibration of fees is reasonable and in accordance with the structure of, and obligations created by, the statute.

Comments: Many commenters viewed the increase in fees as unwarranted and unexpected, and explained the UCR Plan should be adjusting its own budget and spending instead. An anonymous commenter expressed confusion over the increase, claiming that the fees were intended to be eliminated “after full reciprocity.” A different anonymous commenter connected this increase to the UCR Plan's poor budgeting, while another suggested the UCR Plan's spending should be cut instead.

FMCSA Response: FMCSA disagrees with the commenters' statements that the fee increase was unwarranted, unpredictable, and sudden. In a previous rulemaking published in March 2023 (and finalized in June 2023), 3 FMCSA stated it anticipated the UCR Plan would recommend an upward adjustment in the fees for the 2025 registration year to comply with the statutory provisions discussed herein. By statute, the UCR fee is authorized for annual adjustment by FMCSA, either to increase or decrease the fee to ensure adequate funds to provide participating States with their revenue entitlement.

FMCSA also disagrees that the UCR Plan has not been operating within its budget. To FMCSA's knowledge, the UCR Plan has operated within its approved budget and in recent years has steadily decreased registration fees. In fact, this is the first upward adjustment since 2010. The UCR Plan's approved allocation for the costs of administration of the Plan and Agreement over the last several years decreased from $5 million per year and is now at $4.25 million. For these reasons, FMCSA declines to modify the final rule in response to the commenters' suggested changes.

Finally, the commenter who stated that the registration fees would be removed “after full reciprocity,” did not provide sufficient information for FMCSA to understand or provide a response on this issue. In any event, removal of the fees would require Congress to amend the statute.

Comments: Twenty-eight commenters either objected to the increase altogether, expressed criticism towards this proposal, or asked FMCSA to reconsider it. Among those objecting to the increase altogether, six commenters described the UCR fee and the proposed percentage increase as “unnecessary, unjustified, frivolous, and unethical,” while others called it “fraudulent, unconstitutional, and discriminatory.”

An anonymous commenter questioned the motives behind the UCR fees, stating that the purpose for the increase is to create a “slush fund” for FMCSA. Some other commenters asked the Agency to reconsider the proposal to issue the increase until truckers' compensation is increased. One commenter recognized that, while raising fees may be necessary, the percentage is too high, making the increase “difficult to absorb.” An anonymous commenter suggested looking into fee decreases instead.

FMCSA response: FMCSA appreciates the concerns and frustrations expressed by commenters opposed to the fee increase being adopted. The purpose of this fee increase is to cover the $13 million shortfall in the statutorily-required funding, because in 2025 making the required distributions to the States and providing for the cost of administering the plan and will exceed the revenues expected under the current fee levels. Although FMCSA must approve the fee levels for each registration year, FMCSA does not collect these fees and the money does not go into the Agency's budget. Rather, the fees are collected and administered by the UCR Plan. In past years, as required by the statute, these fees were decreased because of excess collections and in effect returned to the industry.

Despite this increase, the proposed fees are still lower than those that were in effect in registration years 2019 through 2022. 4 For instance, carriers in the smallest fee bracket ( i.e., carriers with two vehicles or fewer), brokers, and leasing companies paid a fee of $62 in the 2019 registration year and $68 in the 2020 registration year, which is significantly higher than the proposed fee for 2025 of $46, even before accounting for inflation. Similarly, the fee for carriers in the highest fee bracket ( i.e., carriers with 1,001 vehicles or more) in 2019 was $59,689, rising to $66,072 in 2020. Again, the fee proposed for the 2025 registration year, $44,836, is well below those previous amounts.