[The Regulatory Plan and Unified Agenda of Federal Regulatory and Deregulatory Actions]
[Department of Health and Human Services Regulatory Plan]
[From the U.S. Government Printing Office, www.gpo.gov]

Federal Register / Vol. 61, No. 231 / Friday, November 29, 1996 / The
                            Regulatory Plan

[[Page 62049]]

DEPARTMENT OF HEALTH AND HUMAN SERVICES (HHS)
Statement of Regulatory and Deregulatory Priorities
Departmentwide Priorities
The Department of Health and Human Services (HHS) promotes the health 
and well-being of every single American. With emphasis on children, 
working families, the elderly, disabled persons, the poor, and others 
who are most vulnerable, HHS is the Federal Government's principal 
agency for protecting health and providing essential human services.
HHS activities are strikingly diverse, ranging from some of the largest 
programs in Government (Medicare, Medicaid) to some of the smallest; 
from improving infant health to providing care for the elderly; from 
gathering basic national health statistics to providing front-line 
clinical and Head Start services; from conducting biomedical research 
to ensuring the safety of products that account for 25 cents of every 
dollar spent by the American people.
While continuing to meet its statutory responsibilities, HHS has been a 
major participant in President Clinton's initiative to reduce 
regulatory burden by producing more targeted, focused, and cost-
effective regulations.
HHS began a comprehensive review of existing regulations with its 
implementation of President Clinton's Executive Order 12866 
``Regulatory Planning and Review.'' To assist in identifying priorities 
for this review, the Department solicited recommendations from the 
public in a January 20, 1994, Federal Register notice. On November 28, 
1995, and again on May 13, 1996, HHS requested public comment on the 
Department's regulations through the Unified Agenda of Federal 
Regulatory and Deregulatory Actions, seeking suggestions for furthering 
regulatory reform efforts.
With the President's March 4, 1995, memorandum on the ``Regulatory 
Reinvention Initiative,'' HHS joined the Governmentwide effort to 
pursue additional steps to reduce unnecessary regulatory burden and to 
increase cooperation and coordination with its customers. Specifically, 
the President asked that the Department:
 Conduct a page-by-page review of HHS regulations, with the 
            goal of eliminating or revising those that are outdated or 
            otherwise in need of reform;
 Change the way performance is measured by agencies and 
            frontline regulators to focus on results rather than on 
            process and punishment;
 Create ``grassroots partnerships'' by getting out of 
            Washington and convening groups of frontline regulators and 
            the people affected by regulations to discuss issues of 
            concern; and
 Increase use of consensual rulemaking.
Efforts to comply with this directive have been a major undertaking of 
the Department. The changes in our rulemaking approach are reducing 
burden, as well as promoting better communication, consensus building, 
and a less adversarial environment, while maintaining the critical 
health and safety protections the American people rightly expect. 
Agency heads and other senior officials have held many meetings with 
medical care providers, social service providers, food companies, and 
others to discuss opportunities to minimize burden on small businesses 
and other small entities (as also mandated by the newly amended 
Regulatory Flexibility Act).
The Department has participated in numerous sector-specific regulatory 
reinvention task forces led by the Vice President. These efforts 
continue to produce important reforms in regulations concerning 
clinical laboratories, hospitals, dialysis centers, foods, medical 
devices, biotechnology-derived drugs, cancer drugs, and animal drugs, 
while protecting public health and safety.
Here are some brief descriptions of a few illustrative examples:
 A new Medicare regulation focused in on a highly specific 
            problem--that of lack of coverage for medical devices which 
            use new versions of proven technologies. The regulation 
            established criteria for identifying such devices as ``non-
            experimental'' for Medicare coverage purposes. Medicare 
            beneficiaries thus have gained access to the medical 
            benefits of emerging technologies, and manufacturers of 
            medical devices were given new incentives for continuing 
            technological breakthroughs.
 The Department issued new regulations significantly 
            modernizing the way seafood products are regulated: The 
            Department and seafood companies now collaborate to protect 
            the public health through a state-of-the-art system of 
            preventive controls, put in place by industry and monitored 
            by the Food and Drug Administration, to reduce the risk of 
            food-borne illness.
 On August 28, the Department issued a final rule restricting 
            the sale and distribution of cigarettes and smokeless 
            tobacco in order to protect children and adolescents. The 
            rule restricts the ability of children and adolescents to 
            obtain cigarettes and smokeless tobacco and reduces the 
            appeal of such products.
 In the biotechnology area, a significant overhaul of 
            regulatory requirements is reducing paperwork by thousands 
            of pages and cutting drug development time by months, 
            without diminishing the safety and effectiveness of biotech 
            therapies.
We have given special attention to the President's directive for a 
line-by-line review of all existing regulations with a view to 
eliminating or reinventing those that are obsolete or otherwise in need 
of reform. Regulations occupying over 1000 pages in the Code of Federal 
Regulations have been eliminated, and another 1500 pages' worth of 
rules have been reinvented. Eight hundred additional pages are slated 
for elimination or reinvention as soon as appropriate legislative 
action is taken.
HHS has examined its approach to rulemaking in light of Executive Order 
12875 ``Enhancing the Intergovernmental Partnership'' and of the 
provisions of the Unfunded Mandate Reform Act of 1995. The Department 
is committed to avoiding the imposition of unfunded mandates on State, 
local, and tribal governments. Where such mandates cannot be avoided, 
we are committed to advance consultation with the affected levels of 
government. HHS components have been directed to carry out ``both the 
letter and the spirit'' of E.O. 12875 by considering the effect of all 
issuances and actions--not just formal regulations--on the State, 
local, and tribal levels.
The Department has for the first time successfully used the negotiated 
rulemaking approach to develop rules in a consensual process. This 
process brings Federal officials together with representatives of the 
constituencies to be significantly affected by a new rule to reach 
consensus on some or all issues through open discussions before a 
formal notice of proposed rulemaking is published. HHS recently 
completed a successful effort at reforming the Medicare hospice wage 
index through negotiated rulemaking, with publication of a proposal on 
September 4, 1996. Earlier in 1996, the Department used the ``regneg'' 
approach to create a regulatory framework through which

[[Page 62050]]

administrative responsibility for Indian health programs may be 
smoothly turned over to those tribes who wish to exercise such 
responsibility through a contractual relationship.
The large majority of regulations issued by HHS are associated with the 
Health Care Financing Administration or the Food and Drug 
Administration. Descriptions of priorities for those components of the 
Department are as follows:
Health Care Financing Administration (HCFA)
HCFA has improved its regulations by focusing on rulemakings that 
reduce unnecessary burden, while ensuring continual improvement in the 
quality of services to Medicare and Medicaid beneficiaries. Within 
existing regulation programs, HCFA is following the President's July 
1995 directives to communicate, not dictate, innovate more than 
regulate, and educate not dictate. Working closely with the public in 
developing new rules, HCFA has conducted listening events around the 
country concerning specific regulations to collect ideas on 
partnerships from front-line regulators, those being regulated, and 
other interested stakeholders.
HCFA successfully completed negotiated rulemaking for the wage index 
that is used to adjust payment rates to hospices under the Medicare 
program. As part of the agreement with the members of the negotiating 
committee, incorporated in the proposed rule published on September 4, 
1996, the hospice wage index will rely on the most recent data from the 
hospital wage index published in the Medicare hospital prospective 
payment systems rule published on September 1, 1996.
In response to requests from States and pharmaceutical manufacturers, 
HCFA used alternative dispute resolution procedures to resolve disputes 
over rebated payments under the Medicaid Rebate Program. With the 
assistance of the HHS Departmental Appeals Board, HCFA developed the 
Dispute Resolution Pilot (DRP) that resulted in the resolution of 
disputes over millions of dollars in rebates formerly at issue between 
the 6 New England States and 30 drug manufacturers. Building on the New 
England success, HCFA is expanding the DRP to 14 western States. 
Through this innovative approach, we have clearly improved 
communication between States, private industry, and HCFA and turned the 
situation into a negotiated partnership arrangement.
HCFA plans to conduct two pilot projects concerning end stage renal 
disease (ESRD) facilities. The goal of one pilot is to improve the 
quality of care to Medicare beneficiaries with ESRD by tracking 
specific quality indicators. Over a 2-year period, we will collaborate 
with hemodialysis providers to design a measurement system to assist 
facilities in their efforts to improve care and, when fully operating, 
lessen the regulatory burden on these facilities. Facilities that 
successfully complete this project will be recognized as ``Facilities 
of Achievement'' that have demonstrated the capacity and commitment to 
improve patient care through use of a quality measurement system.
The other ESRD pilot project will be a demonstration that would grant 
approximately six to eight carefully selected ESRD facilities a 2-year 
waiver of the staffing requirements set forth in regulations, which 
would only be granted after determining that patient health and safety 
would not be jeopardized. This is part of the Administration's overall 
strategy to reduce regulatory burdens on the American public and an 
opportunity to further carry out HCFA's commitment to the goals of 
regulating only when necessary and in a cost-effective manner, while 
maintaining and improving quality health services to our customers.
HCFA and the Centers for Disease Control and Prevention (CDC), which 
share responsibility for the Clinical Laboratory Improvement Act (CLIA) 
program, have continually taken actions to reduce burden and improve 
the entire CLIA system. A flexible survey system for good performers, 
which has already been initiated for certain laboratories, allows for 
self-attestation and off-site reviews. Information requirements and 
paperwork have been eliminated, steps have been taken to make personnel 
requirements more flexible, and the inspection process has been 
streamlined. Additional burden reductions have been undertaken that 
will virtually eliminate oversight for certain appropriate 
laboratories, establish performance standards in place of process 
requirements, and use information and education as a substitute for 
sanctions.
As of October 1, 1996, six private accrediting organizations have been 
approved for Federal accrediting status (``deemed'' status) because 
their accreditation standards are as stringent as those of CLIA. In 
addition, exemption from CLIA requirements has been granted to 
laboratories in three States because the States in which they are 
located have requirements equal to or more stringent than CLIA's. The 
impact of these actions is to reduce Federal inspections, offer 
laboratories oversight by peers, and allow States with strong licensure 
programs to be approved for exemption from CLIA.
On August 21, 1996, the President signed into law the Health Insurance 
Portability and Accountability Act of 1996 (P.L. 104-191) under which 
HCFA will have major implementation responsibilities. HCFA will have a 
major role under title I of the new law when it comes to ensuring that 
the American people have health care access, portability, and 
renewability across all health insurance markets. HCFA will also have a 
role in fighting fraud and abuse and ensuring that administrative 
simplification procedures are implemented and followed under the new 
program.
The Personal Responsibility and Work Opportunity Reconciliation Act of 
1996 changes the link between Medicaid eligibility and welfare. HCFA 
will develop Medicaid regulations to implement these changes.
October 1996 Regulatory Plan Entries
The October 1996 Regulatory Plan includes the President's and Vice 
President's initiatives for reinventing health care regulations. CLIA 
regulations are being revised to reduce unnecessary burden and improve 
the CLIA system by rewarding good performance by laboratories, creating 
incentives for manufacturers to develop more reliable testing 
equipment, and using proficiency testing as an outcome measure to 
monitor laboratory performance.
New regulations for hospitals, home health agencies, and ESRD 
facilities will focus on the outcomes of care and replace unnecessary 
process requirements. These three proposed rules would provide for the 
collection and analysis of patient care data needed for continuous 
quality improvement and performance evaluation, increase consistency of 
requirements across providers, and ask the customer to provide input on 
what the outcome measures should be and evaluate the services they 
received.
A new HCFA entry in The Regulatory Plan would simplify, expedite 
appeals, and improve protections afforded to beneficiaries under 
managed health care plans; i.e., health maintenance

[[Page 62051]]

organizations, competitive medical plans, and health care prepayment 
plans. In keeping with HCFA's now standard practice under the 
President's and Vice President's reinventing government and regulatory 
reform initiatives, input will be sought from all affected interests 
(i.e., beneficiaries, managed care contractors, and others) during the 
development of this rule.
Food and Drug Administration (FDA)
FDA's regulatory efforts continue to reflect the Administration's 
emphasis on reforming the Federal Government's regulatory practices 
without sacrificing public health and safety protections.
FDA's regulatory program has three broad goals: (1) To eliminate 
unnecessary burdens on the regulated industry, (2) to get products to 
market more quickly, and (3) to allow FDA to do its job more 
effectively.
For example, on November 27, 1995, FDA published a proposed rule in the 
Federal Register that would streamline the requirements for exporting 
unapproved devices for investigational use (60 FR 58308). The proposed 
rule would eliminate unnecessary submissions to FDA without affecting 
the agency's ability to determine whether exportation of the device was 
contrary to public health or safety.
On December 18, 1995, FDA published a final rule in the Federal 
Register that would significantly change the way seafood products are 
regulated. The regulations were based on principles of a system called 
Hazard Analysis Critical Control Points (HACCP) to keep unsafe products 
from reaching consumers. HACCP is a system of preventative controls put 
in place in industry and monitored by FDA to reduce the risk of food-
borne illness. Under HACCP, firms perform a science-based analysis of 
their potential safety hazards that would make seafood hazardous, 
monitor critical control points to minimize risks, and keep a record of 
the results so Government inspectors can have a clear, systematic view 
of how well firms are doing. Thus, under the seafood HACCP regulations, 
Government and industry work together to protect the public health; 
this represents a significant advancement over the pre-existing system 
where safety problems were addressed only after they had occurred.
Other accomplishments by FDA include issuance of final rules regarding 
humanitarian use devices (June 26, 1996). These are devices that are 
intended to benefit patients by treating or diagnosing a disease or 
condition that affects or is manifested in less than 4,000 individuals 
in the United States annually.
The agency also revoked hundreds of pages of regulations that were 
outdated or obsolete (see, e.g., 61 FR 37682; July 19, 1996).
More recently, on August 28, 1996 (61 FR 44396), the agency issued a 
final rule restricting the sale and distribution of cigarettes and 
smokeless tobacco in order to protect children and adolescents. The 
rule restricts the ability of children and adolescents to obtain 
cigarettes and smokeless tobacco and reduces the appeal of such 
products.
Regulatory Plan Entries
FDA's regulations plan, which follows, contains initiatives that 
reflect the President's goal of providing traditional public health 
protections through a streamlined regulatory process that is focused on 
minimizing burdens on those who are regulated. Regulations included in 
the plan protect the health of women by assuring a high quality of 
mammography, take steps to prevent the development of bovine spongiform 
encephalopathy (BSE) in cattle in the United States, and streamline the 
process for reporting changes to a biological product.
Administration for Children and Families
The Administration for Children and Families (ACF), as part of its 
strategy to better serve its client populations, has made regulatory 
reform one of its key principles. All ACF regulatory efforts will 
respond to the needs of States, tribes, and local partners through a 
consultative process that is open and reaches out to all involved 
parties. This philosophy will guide ACF as the Agency seeks to fulfill 
its responsibilities in implementing the provisions of the newly 
enacted welfare reform legislation, The Personal Responsibility and 
Work Opportunity Reconciliation Act of 1996.
The enactment of this law is an opportunity to continue the work 
already begun to change the culture of welfare in this country so that 
it focuses on work, provides the supports necessary to ensure a 
successful transition to work, demands greater responsibility from 
those participating in the system, and protects children. ACF is 
committed to working with the States, wherever possible, to facilitate 
this process and assure that the goals of welfare reform can be 
achieved.
Initially, ACF will promulgate two regulations which are significant in 
implementing the Temporary Assistance for Needy Families (TANF) Block 
Grant under welfare reform. These regulations will clarify States' 
responsibilities for assuring that work participation rates are being 
achieved and will address the consequences when States are not able to 
get people to work or meet other key expectations of the legislation.
We will continue to work with our partners to identify any other 
significant regulatory initiatives which may be necessary for 
implementation of the welfare reform legislation.
_______________________________________________________________________
HHS--Food and Drug Administration (FDA)

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                          PROPOSED RULE STAGE

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26. MAMMOGRAPHY QUALITY STANDARDS ACT OF 1992
Priority:


Economically Significant. Major status under 5 USC 801 is undetermined.


Legal Authority:


 PL 102-539 Mammography Quality Standards Act of 1992; 42 USC 263b


CFR Citation:


 21 CFR 900


Legal Deadline:


 Final, Statutory, July 27, 1993.


Standards for accreditation bodies are required by July 27, 1993.


Abstract:


The purpose of the Mammography Quality Standards Act of 1992 (MQSA), 
enacted October 27, 1992, is to assure quality in all aspects of the 
practice of mammography. The primary mechanism for this is oversight of 
all mammography facilities through a certification and inspection 
program. Only facilities certified by the Secretary are permitted to 
produce, process, or interpret mammographic images. The statute also 
required the establishment of an advisory committee to advise on 
appropriate quality standards and also provided for the establishment 
of surveillance systems to evaluate breast cancer screening programs.
The agency published interim regulations on December 21, 1993, which 
were drafted and implemented so as to maximize lawful operation by 
facilities under existing quality standards, and to ensure adequate 
examinee access to quality

[[Page 62052]]

mammography during the transition to more comprehensive national 
standards.
Concurrent with the implementation of the interim rules, FDA proceeded 
with the development of proposed regulations to replace the interim 
rules. The agency recently issued proposed rules, with the advice and 
consultation of the National Mammography Quality Assurance Advisory 
Committee, on requirements for accreditation bodies, equipment and 
quality assurance requirements, facility requirements, and personnel 
requirements.


Statement of Need:


Nearly 50,000 women die each year from breast cancer. While much 
research into causes and treatments still needs to be done, we do know 
that, for women over 50, mortality for lesions found by mammography is 
30 percent less than for larger lesions identified by physical 
examination. Unfortunately, not all mammography facilities have offered 
services commensurate with the value of mammography in the abstract. 
The Congress enacted the MQSA to ensure quality mammography services 
for all women.
The primary mechanism established by the MQSA to ensure quality in 
mammography is oversight of all mammography facilities through a 
certification and inspection program. Only facilities certified by the 
Secretary will be permitted to produce, process, or interpret 
mammographic images. The statute also requires the establishment of a 
committee of experts to offer advice about regulatory quality standards 
and also provides for the establishment of surveillance systems to 
evaluate breast cancer screening programs.
The implementation of these regulations will help ensure that 
mammograms are properly administered and interpreted to provide 
adequate protection, diagnosis, and treatment of breast cancer among 
women. FDA has worked with the Health Care Financing Administration, 
the Centers for Disease Control, and State and local radiation control 
officials to coordinate mammography quality assurance activities and 
the development of policies and regulations for implementation of the 
MQSA, and will continue to coordinate its efforts with these agencies 
as appropriate.


Summary of the Legal Basis:


The MQSA established a comprehensive statutory scheme for the 
certification and inspection of mammography facilities to ensure that, 
after October 1, 1994, only those facilities that comply with minimum 
Federal standards for safe, high-quality mammography services may 
lawfully continue to operate. Operation after that date is contingent 
on receipt of an FDA certificate attesting that the facility meets the 
minimum mammography quality standards promulgated under section 354(f) 
of the Public Health Service Act. The standards are intended to apply 
equally to screening and diagnostic mammography. The MQSA required: (a) 
accreditation of mammography facilities by private, nonprofit 
organizations or State agencies meeting FDA established standards; (b) 
annual physics surveys of mammography facilities; (c) annual 
inspections of mammography facilities; (d) qualification standards for 
interpreting physicians, radiologic technologists, medical physicists, 
and mammography facility inspectors; (e) specification by FDA of boards 
or organizations eligible to certify mammography personnel; (f) quality 
standards for mammography equipment and practices, including quality 
assurance; (g) establishment of the National Mammography Quality 
Assurance Advisory Committee; and (h) standards governing recordkeeping 
for examinee files and requirements for mammography reporting and 
examinee notification by physicians.


Alternatives:


The statute is prescriptive and does not allow for a substantially 
different regulatory approach than is being taken by FDA. It allows for 
discretion in the details of individual standards, and FDA has sought 
to avoid unnecessary burden in devising these standards. In order to 
reduce the burden of complying with the MQSA regulations on mammography 
facilities, FDA incorporated existing standards to the maximum extent 
possible; issued Federal certificates, which are required for 
facilities to legally operate after October 1, 1994, to facilities 
already accredited by the American College of Radiology; required 
facilities to submit information for certification only to the 
accrediting body--not to FDA; and allowed flexibility to accrediting 
bodies in developing their standards by requiring that accrediting body 
standards be ``substantially the same as'' FDA's standards, rather than 
identical.


Anticipated Costs and Benefits:


Yearly costs to mammography facilities, over a 10-year period, were 
estimated to range from a high of approximately $203.2 million to $25.2 
million. Yearly costs differed due to the phased implementation dates 
for some proposed requirements. Overall, average annualized costs of 
the proposals are preliminarily estimated at $61.4 million.
There are many benefits associated with these proposed rules. High-
quality mammography could significantly reduce breast cancer mortality. 
Early detection could reduce the morbidity associated with treating 
later-stage disease. There may be a reduction in the number of 
malpractice claims filed for failure to diagnose early breast cancer. 
In addition, because of improved mammography quality, the agency 
expects a reduction in the number of follow-up procedures in 
nondiseased patients, resulting in a reduction of annual medical costs. 
By themselves, the health care cost savings are expected to 
substantially exceed the expected average annualized costs.


Risks:


The motivation for the MQSA was public response to concerns about 
breast cancer and to concerns about the quality of mammography services 
relied on for early detection of breast cancer. Breast cancer is the 
most prevalent nonskin cancer among women (and the second most deadly) 
with over 175,000 new cases and 45,000 breast cancer-related deaths 
occurring annually. The disease is most treatable in the early stages. 
Missed diagnosis of early lesions due to factors such as poor image 
quality or incorrect interpretation of images could result in delayed 
treatment, leading to otherwise avoidable increases in mortality or 
more complex and costly remediations.


Timetable:
_______________________________________________________________________
Alternative Approaches
NPRM 04/03/96 (61 FR 14856)
Review of Comments 01/00/97
Approval of Accrediting Bodies
Interim Final Rule 12/21/93 (58 FR 67558)
Draft Proposed Quality Standards
Notice of Availability 01/26/95 (60 FR 5152)
Draft X-Ray and Medical Physicist Standards Proposals
Notice of Availability; 12/30/94 (59 FR 67710)
General Facility Requirements
NPRM 04/03/96 (61 FR 14870)
Review of Comments 01/00/97
Mammography Quality Standards Act of 1992; Inspection Fees
Notice 03/17/95 (60 FR 4584)

[[Page 62053]]

Personnel Requirements
NPRM 04/03/96 (61 FR 14898)
Review of Comments 01/00/97
Quality Standards for Mammography Equipment and QA
NPRM 04/03/96 (61 FR 14908)
Review of Comments 01/00/97
Quality Standards for Mammography Facilities
Interim Final Rule 12/21/93 (58 FR 67565)
Quality Standards/Certification Rqmts.
Interim Final Rule 09/30/94 (59 FR 49808)
Requirements for Accreditation Bodies and Quality Standards
Notice (Advisory Committee) 12/21/94 (59 FR 65776)
NPRM 04/03/96 (61 FR 14884)
Review of Comments 01/00/97
Small Entities Affected:


Businesses, Governmental Jurisdictions


Government Levels Affected:


State, Local, Federal


Additional Information:


Previously reported under RIN 0905-AE07.


Agency Contact:
Charles K. Showalter
Office of Health and Industry Programs
Department of Health and Human Services
Food and Drug Administration
Center for Devices and Radiological Health (HFZ-240)
1350 Piccard Drive
Rockville, MD 20850
Phone: 301 594-3332
RIN: 0910-AA24
_______________________________________________________________________
HHS--FDA
27.  SUBSTANCES PROHIBITED FROM USE IN ANIMAL FOOD OR FEED; 
PROTEIN DERIVED FROM RUMINANTS PROHIBITED IN RUMINANT FEED
Priority:


Economically Significant. Major under 5 USC 801.


Unfunded Mandates:


This action may affect State, local or tribal governments.


Legal Authority:


 21 USC 321; 21 USC 342; 21 USC 348; 21 USC 371


CFR Citation:


 21 CFR 589.2000


Legal Deadline:


None


Abstract:


The Food and Drug Administration is proposing rules providing that 
animal protein derived from ruminant and mink tissues are not generally 
recognized as safe (GRAS) for use in ruminant feed and is a food 
additive subject to section 409 of the Federal Food, Drug, and Cosmetic 
Act. Therefore, protein derived from ruminants and mink are prohibited 
from use in ruminant feed. The proposed rule would establish a flexible 
system of controls to ensure that ruminant feed does not contain animal 
protein derived from ruminant and mink tissues in a manner that is cost 
effective and encourages innovation. While BSE has not been diagnosed 
in the United States, this rule is intended to prevent the development 
and amplification of bovine spongiform encephalopathy (BSE) in cattle 
to protect the health of animals and to minimize any risk which might 
be posed to humans.


Statement of Need:


The Food and Drug Administration (FDA) is proposing this action to 
protect the health of animals and to minimize any risk which tfght be 
posed to humans, through the transmission of transmissible spongiform 
encephalopathies (TSEs). While BSE has not been diagnosed in the United 
States, this rule is intended to prevent the development and 
amplification of bovine spongiform encephalopathy in cattle in the 
United States. Ruminant and mink tissues present a risk of transmitting 
spongiform encephalopathies. These tissues have been found through 
experimental trials and bioassays to transmit spongiform 
encephalopathies. Epidemiological evidence gathered in the United 
Kingdom (UK) suggests an association between an outbreak of BSE, a 
ruminant TSE, and the feeding to cattle of protein derived from sheep 
infected with scrapie, another TSE. The causative agent was further 
spread in the UK cattle population as a result of feeding rendered 
products to cattle. In addition, scientists have postulated an 
epidemiological association between BSE and a variant form of human 
TSE, Creutzfeldt-Jakob Disease (v-CJD) reported recently in England. 
FDA is not aware of a practical assay for the presence of ruminant 
protein in rendered products. Nor is FDA aware of a reliable 
deactivation procedure in the rendering process which is used to 
produce the proteins.


Summary of the Legal Basis:


A substance used in food (including animal feed) that is not generally 
recognized as safe is a ``food additive'' under section 201(s) of the 
Food, Drug, and Cosmetic Act. A food additive is unsafe under section 
409 of the Act unless a food additive regulation or an exemption is in 
effect for the substance. An unsafe food additive is adulterated under 
section 402(a)(2)(c) of the Act. Section 701(a) of the Act provides 
authority to issue regulations for the efficient enforcement of the 
Act, including regulations that determine substances to be food 
additives.


Alternatives:


The agency considered a number of alternatives regarding the feeding of 
animal protein to ruminants; including a prohibition of feeding protein 
derived from adult sheep and goats, restricting the prohibition only to 
ruminant tissues that had been demonstrated to be potentially TSE 
infective, and a prohibition of feeding of protein derived from 
mammalians. In addition the agency considered not taking any action 
regarding the feeding on animal proteins. The grave potential 
consequences of exposure to TSE and the apparent small intake of the 
agent needed to achieve infection in small animals encourage a 
conservative regulatory policy.


Anticipated Costs and Benefits:


The affected industry sectors are predicted to incur total direct 
compliance costs ranging from $21.4 to $48.2 million per year. The 
benefits of prohibiting ruminant proteins in ruminant feeds are the 
reduced risks to animal and human health and to the economic health of 
the U.S. livestock and livestock dependent industries. For analytical 
purposes, these benefits can be expressed as the expected value of the 
future disease related costs that would be averted by the present 
implementation of the proposed rule. The realized benefits depend 
primarily on two factors: 1) the risk that BSE will occur in the U.S. 
(or currently exists undetected), and 2) the incidence rate of BSE once 
it becomes established. The proposed measure is aimed both at reducing 
the first risk, and at eliminating the second if the first should 
occur. The UK will destroy an additional 1 million cattle in 1996 for 
this reason, or about 8.7 percent of its cattle stock. Risks are 
inherently lower in the United States. Similar measures in the U.S., if 
they occurred immediately upon detection of the disease, would result 
in the one-time destruction of $4.58 billion worth of cattle, with a 
present value of $3.49 billion.

[[Page 62054]]

Risks:


Based on the scientific information that is available at the present 
time, the primary health concern related to animal feed is the 
possibility of transmission of TSE infectively from BSE-infected 
bovines, with the risk of that threat increasing through the recycling 
of ruminant tissues. Furthermore, there exists the theoretical 
possibility of the transmission of a TSE in animals to a TSE in humans. 
The possibility of other TSE transmissions between species, in addition 
to the postulated transmission of a sheep TSE (scrapie) to cattle, 
supports the agency's concern about TSE transmission and infectivity 
both in animals and humans. The typically long incubation period and 
the potentially devastating effect that a BSE outbreak would have on 
animal health and U.S. agribusiness, support a conservative regulatory 
approach aimed at prevention. While no BSE has been diagnosed in the 
United States, and the current level of exposure to products derived 
from animals with a TSE is extremely low or absent, the potential 
consequences of such exposure and the apparent small intake of the 
agent needed to achieve infection in some animals further encourage a 
conservative regulatory policy.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
ANPRM           61 FR 24253                                    05/14/96
ANPRM Comment Period End                                       06/15/96
NPRM                                                           12/00/96
Small Entities Affected:


Businesses


Government Levels Affected:


None


Agency Contact:
G.A. Mitchell
Director, Office of Surveillance and Compliance
Department of Health and Human Services
Food and Drug Administration
Center for Veterinary Medicine
1500 Standish Place
Rockville, MD 20832
Phone: 301 594-1761
Email: georgemitchell@osc@fdacvm
RIN: 0910-AA91
_______________________________________________________________________
HHS--FDA

                              -----------

                            FINAL RULE STAGE

                              -----------

28. CHANGES TO AN APPROVED APPLICATION
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 15 USC 1451 to 1461; 21 USC 321; 21 USC 351 to 353; 21 USC 355; 21 USC 
360; 21 USC 360c to 360f; 21 USC 360u to 360j; 21 USC 371; 21 USC 374; 
21 USC 379e; 21 USC 381; 42 USC 216; 42 USC 241; 42 USC 262 to 263


CFR Citation:


 21 CFR 601


Legal Deadline:


None


Abstract:


The Food and Drug Administration (FDA) is issuing a final rule to 
revise 21 CFR 601.12, which deals with changes in the production of 
licensed biological products--for example, product labeling, production 
process, equipment, facilities, and responsible personnel. Currently, 
licenseholders must obtain FDA preapproval of all such changes through 
supplements to approved applications. In the final rule, FDA sets forth 
a process that is intended to reduce the burden on licenseholders by 
reducing the number of supplements submitted for changes and to result 
in more timely approval of changes in their products. The new process 
creates different mechanisms for reporting changes, based on their 
potential to affect adversely the safety, purity, potency, or 
effectiveness of the product.


Statement of Need:


The present system has been shown to be burdensome to both 
licenseholders and to FDA in that licenseholders must submit 
supplements for every proposed change, and FDA must review them. The 
present system is also time-consuming--manufacturers may wait from 6 to 
12 months for approval of supplements--and unnecessarily rigid. FDA 
estimates that the final rule would reduce by 50 percent--from 1,000 to 
500--the number of supplements submitted annually for biologics and 
reviewed by FDA, allowing for more expeditious agency review of 
supplements that are submitted.


Summary of the Legal Basis:


The Public Health Service Act (42 USC 216 et seq.) and the Federal 
Food, Drug, and Cosmetic Act (21 USC 321 et seq.) authorize FDA to 
regulate the distribution of biological products so that the products 
are safe, pure, potent, and effective. These acts authorize FDA to 
promulgate regulations designed to ensure that the public is not 
exposed to biological products that may not be safe, pure, or potent 
for their intended uses. In order to carry out the public health 
protection purposes of the FD&C Act, FDA (a) reviews and approves 
applications for licenses to manufacture biological products; (b) 
inspects establishments involved in manufacturing activities; and (c) 
reviews and approves important changes that have the potential to 
adversely affect the biological product.


Alternatives:


FDA considered two alternatives. The first alternative was allowing 
license holders to submit summary data and a certification of 
validation and lack of adverse effect on the product's safety, purity, 
potency, or efficacy. FDA believes this alternative is appropriate for 
some changes, but not adequate or sufficient for changes with 
substantial potential to have an adverse effect.
The second alternative would have required license holders to keep 
validation data and certification of lack of adverse effect, and 
allowed them to report changes to FDA in an annual report. FDA believes 
this alternative is appropriate for changes that have only a minimal 
potential for adverse effect on the product. It is incorporated into 
the final rule.


Anticipated Costs and Benefits:


In general, the final rule is expected to reduce significantly the 
burden of preparing supplements for proposed changes by eliminating 
this requirement for a number of changes. The final rule will 
accordingly reduce the number of supplements requiring FDA review and 
allow for more expeditious handling of supplements that are submitted. 
Licenseholders are expected to incur no additional costs as a result of 
the proposal; on the other hand it will allow for more timely 
implementation of changes by licenseholders--for example,

[[Page 62055]]

streamlining and updating manufacturing facilities.


Risks:


FDA believes the risks posed by the new reporting system are minimal. 
In addition to stating in the revision which changes are considered to 
have substantial, moderate, and minimal potential for adverse effects, 
FDA will provide thorough supplementary guidance to manufacturers to 
help assure adequate assessment of the potential for adverse effects.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM            61 FR 2739                                     01/29/96
NPRM Comment Period End                                        04/29/96
Final Action                                                   05/00/97
Small Entities Affected:


Businesses


Government Levels Affected:


None


Agency Contact:
Steven F. Falter
Director, Division of Regulations and Policy
Department of Health and Human Services
Food and Drug Administration
Center for Biologics Evaluation and Research (HFM-630), 1401 Rockville 
Pike
Suite 200N, Rockville, MD 20852-1448
Phone: 301 594-3074
RIN: 0910-AA57
_______________________________________________________________________
HHS--Health Resources and Services Administration (HRSA)

                              -----------

                            FINAL RULE STAGE

                              -----------

29. ORGAN PROCUREMENT AND TRANSPLANTATION NETWORK RULES
Priority:


Other Significant


Legal Authority:


 42 USC 1320b-8 sec 1138 of the Social Security Act; 42 USC 274 sec 372 
of the Public Health Service Act


CFR Citation:


 42 CFR 121


Legal Deadline:


None


Abstract:


Section 1138 of the Social Security Act requires Medicare and Medicaid 
participating hospitals that perform organ transplants to be members of 
and abide by the rules and requirements of the Organ Procurement and 
Transplantation Network (OPTN) as established by section 372 of the 
Public Health Service Act. Section 1138 also requires that for organ 
procurement costs attributable to payments to an Organ Procurement 
Organization (OPO) to be paid by Medicare or Medicaid, the OPO must be 
a member of and abide by the rules and requirements of the OPTN. No 
other entity (for example, a histocompatibility laboratory) is required 
to be a member of or abide by the rules of the OPTN under the 
provisions of the statute. It is the Department's position that no 
rule, requirement, policy, or other issuance of the OPTN will be 
considered to be a ``rule or requirement'' of the Network within the 
meaning of section 1138 unless the Secretary has formally approved that 
rule. The OPTN is currently in operation and these rules will impose no 
further cost or provide any benefit other than that which now exists.


Statement of Need:


These regulations are required by law.


Summary of the Legal Basis:


Section 1138 of the Social Security Act (42 USC 1320b-8) requires 
Medicare and Medicaid participating hospitals that perform organ 
transplants to be members of and abide by the rules and requirements of 
the Organ Procurement and Transplantation Network (OPTN) as established 
by section 372 of the Public Health Service Act (42 USC 274).


Alternatives:


The alternative was to continue without codifying existing policies.


Anticipated Costs and Benefits:


There are no anticipated costs beyond the cost of preparing the 
regulations (approximately $100,000.00). The anticipated benefit is 
that the regulations will make mandatory adherence to the policies set 
forth in the regulations.


Risks:


None known.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM            59 FR 46482                                    09/08/94
NPRM Comment Period End                                        12/07/94
Final Action                                                   03/00/97
Small Entities Affected:


None


Government Levels Affected:


None


Additional Information:


Previously reported under RIN 0905-AD26.


Agency Contact:
Judy Braslow
Director, Division of Transplantation
Bureau of Health Resources Development
Department of Health and Human Services
Health Resources and Services Administration
Room 7-29 Parklawn Bldg.
5600 Fishers Lane
Rockville, MD 20857
Phone: 301 443-7577
RIN: 0906-AA32
_______________________________________________________________________
HHS--Health Care Financing Administration (HCFA)

                              -----------

                          PROPOSED RULE STAGE

                              -----------

30. REVISION OF MEDICARE HOSPITAL CONDITIONS OF PARTICIPATION (BPD-745-
P)
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 42 USC 1395x; 42 USC 1302; 42 USC 1395(cc); 42 USC 1395(hh)


CFR Citation:


 42 CFR 482


Legal Deadline:


None


Abstract:


This proposed rule would revise the requirements that hospitals must 
meet to participate in the Medicare and Medicaid programs. The revised 
requirements focus on patient care and the outcomes of that care, 
reflect a

[[Page 62056]]

cross-functional view of patient treatment, encourage flexibility in 
meeting quality standards, and eliminate unnecessary procedural 
requirements. These changes are necessary to reflect advances in health 
care practices since the requirements were last revised in 1986. This 
regulation is part of the Administration's reinventing government and 
regulatory reform initiatives.


Statement of Need:


The purpose of the hospital conditions of participation is to protect 
patient health and safety and help assure that quality care is 
furnished to all hospital patients. Hospitals must meet the conditions 
of participation in order to participate in Medicare or Medicaid. 
Revised conditions are necessary to ensure that our regulations focus 
primarily on the actual quality of care furnished to patients, and the 
outcomes of that care, rather than on procedural compliance. These 
changes are intended to give hospitals the flexibility needed to 
achieve high-quality outcomes in the most cost-effective manner.
In addition, the regulations are intended to promote a cross-
functional, interdisciplinary approach to hospital performance, instead 
of an approach geared towards evaluating each department of a hospital 
as a stand-alone entity. This approach is in line with current best 
practices in hospitals, in which patients routinely encounter many 
caregivers and services that often cut across department lines.


Summary of the Legal Basis:


Section 1861(e) of the Social Security Act (the Act) provides that a 
hospital participating in the Medicare program must meet certain 
specified requirements. In addition, section 1861(e)(9) of the Act 
specifies that a hospital also must meet such requirements that the 
Secretary finds are necessary in the interest of the health and safety 
of the hospital's patients. Under this authority, the Secretary has 
established in regulations the requirements that a hospital must meet 
to participate in Medicare. These requirements are set forth in 
regulations at 42 CFR Part 482, Conditions of Participation for 
Hospitals. Section 1905(a) of the Act provides that Medicaid payments 
may be applied to hospital services. Under regulations at 42 CFR 
440.10(a)(3)(iii), hospitals generally are required to meet the 
Medicare conditions of participation in order to participate in 
Medicaid.


Alternatives:


HCFA considered the possibility of revising individual sections of the 
current hospital regulations. However, we determined that the best 
means of achieving the systematic changes needed in the regulations was 
to revise the hospital conditions in their entirety. The specific areas 
that are likely to form the core of the revised requirements include 
patient rights, patient assessment, patient care, quality assessment 
and improvement, and information management.


Anticipated Costs and Benefits:


There would not be significant costs associated with this proposed 
rule. The benefits that would be derived from the rule are discussed in 
the Need section, above.


Risks:


By revising these regulations to focus on the quality of the actual 
care given to an individual and the effectiveness of that care for the 
individual patient, we hope to reduce risks to beneficiaries' health 
and safety. Revised procedures can better focus on ensuring that the 
care being given to a patient is the care that is actually necessary 
and effective for that patient. No quantitative estimates of risk 
reductions are available yet.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           01/00/97
Small Entities Affected:


Undetermined


Government Levels Affected:


Undetermined


Additional Information:


BPD-745


Agency Contact:
Charles Booth
Director, Office of Hospital Policy
Bureau of Policy Development
Department of Health and Human Services
Health Care Financing Administration
C5-02-23
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-4487
RIN: 0938-AG79
_______________________________________________________________________
HHS--HCFA
31. HOME HEALTH AGENCY (HHA) CONDITIONS OF PARTICIPATION (BPD-819-P)
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 42 USC 1302; 42 USC 1395x; 42 USC 1395cc(a); 42 USC 1395hh; 42 USC 
1395bbb


CFR Citation:


 42 CFR 484


Legal Deadline:


None


Abstract:


This proposed rule would revise home health agency conditions of 
participation to center on the patient, using outcome-oriented 
measures. Most of the current HHA conditions of participation have 
remained unchanged since home health services became a Medicare benefit 
in 1966. Some limited modifications have been made over the years to 
comply with legislative changes. As a result, most of the conditions of 
participation continue to be structure and process oriented. They do 
not effectively support the mandate of the Omnibus Budget 
Reconciliation Act of 1987 (OBRA '87) to develop a patient-centered, 
outcome-oriented survey process that focuses on the organization and 
delivery of quality care services. This proposed rule is part of the 
Administration's Reinventing Government and Regulatory Reform 
Initiatives.


Statement of Need:


Because the existing survey process continues to focus on structure and 
process measures, the discrepancy between a Congressional mandate for 
outcome-oriented care and the authority for measuring the actual 
performance capabilities of HHAs in patient care services remains a 
problem. It presents difficulties for both providers and surveyors in 
areas of survey/certification, medical review, developing data based 
performance standards for HHA management and monitoring, and 
implementing a continuous quality improvement system for outcomes of 
care.

[[Page 62057]]

Regulations containing the Medicare HHA conditions of participation 
must be revised in order to provide a regulatory basis for a patient-
centered, outcome-oriented system of home health quality assurance. The 
implementation of such a system will enhance Medicare's ability to 
ensure that high-quality care is furnished to the patients of Medicare-
certified home health agencies. The Social Security Act authorizes us 
to regulate this area and no improvements in the survey process can be 
made without underlying regulatory authority.
The Health Care Financing Administration has already met with a variety 
of provider and consumer representatives to discuss the development of 
revised standards. Representatives of consumers, providers, and States 
participated in this effort. Additional consultations are ongoing.


Alternatives:


Congress has mandated the implementation of an outcome-oriented quality 
assurance system for home health. Therefore, the Medicare home health 
agency conditions of participation must be revised to provide the basis 
for implementation of such a system. Because of this mandate, no 
alternatives to this action have been considered.


Anticipated Costs and Benefits:


The primary benefit of this rule will be the implementation of a more 
effective, efficient, and patient-centered system of quality assurance 
for HHAs. Costs and benefits associated with the implementation of the 
rule have not yet been estimated, but costs should not be significant.


Risks:


This rule would have the potential for reducing risks to patient health 
and safety. No quantitative estimates are available yet.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           01/00/97
Small Entities Affected:


Businesses, Organizations


Government Levels Affected:


Undetermined


Additional Information:


BPD-819


Agency Contact:
Susan Levy
Health Insurance Specialist
Department of Health and Human Services
Health Care Financing Administration
C4-05-27
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-9364
RIN: 0938-AG81
_______________________________________________________________________
HHS--HCFA
32. END-STAGE RENAL DISEASE (ESRD) CONDITIONS FOR COVERAGE (BPD-818-P)
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 42 USC 1395rr


CFR Citation:


 42 CFR 405; 42 CFR 406; 42 CFR 409; 42 CFR 412; 42 CFR 413; 42 CFR 
414; 42 CFR 489; 42 CFR 492


Legal Deadline:


None


Abstract:


This proposed rule would revise current conditions of coverage for end-
stage renal disease (ESRD) services covered by Medicare. It would 
update the conditions to reflect new developments in outcome-oriented 
standards technology and equipment, emphasize the total patient 
experience with dialysis and develop performance expectations for the 
facility that result in quality, comprehensive care for the dialysis 
patient. This rule is part of the Administration's Reinventing 
Government and Regulatory Reform Initiatives.


Statement of Need:


Section 1881(b)(1) of the Social Security Act stipulates that payment 
is made to individuals, providers of services, and renal dialysis 
facilities that meet the requirements for institutional dialysis 
services and supplies that are determined by the Secretary. These 
requirements are the end-stage renal disease (ESRD) conditions of 
coverage.
The ESRD conditions for coverage regulations have not been 
comprehensively revised since their inception in the late 1970s. The 
current regulations primarily focus on process-oriented requirements, 
which are unnecessarily burdensome. They do not provide adequate 
support for a modern survey system based on an outcome-oriented 
approach. As a result, revised regulations must be issued to bring the 
ESRD conditions for coverage up to current standards of practice in the 
ESRD community. They must also reflect new developments in technology 
and equipment, as well as addressing the outcome-oriented standards 
process.
The regulations would focus on the patient and the results of the care 
provided to the patients with the emphasis on total patient experience 
with dialysis and quality improvement. The revised regulations should 
focus on patient-centered, outcome-oriented standards where 
appropriate. In addition, they should emphasize patient functional 
well-being and indicate continuous quality improvement. Patient rights 
and satisfaction will also be key areas in the regulation. The revised 
regulations would develop performance expectations for the facility 
that would result in quality, comprehensive care for the dialysis 
patient.
In keeping with the Administration's policy of working with our private 
sector partners, we held a meeting with the industry to discuss the 
focus of revisions to the conditions for coverage. Following 
publication of the proposed rule, we will consult further with the 
industry.


Alternatives:


In the past, HCFA has revised pieces of the ESRD regulations. However, 
we have determined that a complete and thorough revision would be a 
more effective mechanism for developing a comprehensive approach to 
quality care for the dialysis patient. In addition, this approach 
provides greater potential for successful implementation. Another 
option is to update the current regulations and maintain the process-
oriented standards without developing an outcome-oriented approach. 
However, for the reasons discussed, we believe it is important to move 
forward with the outcome-oriented approach.


Anticipated Costs and Benefits:


The purpose of this proposed rule is to ensure that ESRD beneficiaries 
are receiving quality care in the areas of

[[Page 62058]]

dialysis and transplantation. We believe that revised regulations are 
necessary to ensure that all facilities are using the most effective 
technology and equipment. The primary benefit of updating the 
conditions for coverage is the development of performance expectations 
for the facility that would result in the comprehensive, integrated 
care and outcomes the patient needs and wants. As a result, the 
beneficiaries would receive an improved quality of care. In addition, 
the revised regulations would address the issue of adequacy of 
dialysis, which would have a significant impact on ensuring that 
patients are not being underdialyzed.
Items that have the potential to affect the cost of the ESRD program 
include data gathering and infection control. However, at this time the 
cost or savings to the Medicare program have not yet been established, 
but costs should not be significant.


Risks:


If the ESRD regulations are not updated, our regulations will not 
reflect new developments in technology and equipment, thereby denying 
the improved protections to patients' health care that would result 
from this proposed rule.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           01/00/97
Small Entities Affected:


Undetermined


Government Levels Affected:


Undetermined


Additional Information:


BPD-818


Agency Contact:
Lynn Merritt-Nixon
Office of Hospital Policy
Department of Health and Human Services
Health Care Financing Administration
C5-05-15
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-4652
RIN: 0938-AG82
_______________________________________________________________________
HHS--HCFA
33.  CHANGES TO THE HOSPITAL INPATIENT PROSPECTIVE PAYMENT 
SYSTEM AND FISCAL YEAR 1998 RATES (BPD-878-P)
Priority:


Other Significant. Major under 5 USC 801.


Legal Authority:


 42 USC 1395ww


CFR Citation:


 42 CFR 412; 42 CFR 413


Legal Deadline:


 NPRM, Statutory, May 1, 1997. Final, Statutory, September 1, 1997.


Abstract:


Medicare pays for hospital inpatient services under a prospective 
payment system (PPS) in which payment is made at a predetermined 
specific rate for the operating and capital-related costs associated 
with each discharge. These rules would announce the prospective payment 
rates for operating and capital-related costs for FY 1998. We would 
also revise the Medicare hospital inpatient prospective payment systems 
for operating costs and capital-related costs to implement necessary 
changes arising from our continuing experience with the systems. In 
addition, we would set forth rate-of-increase limits as well as policy 
changes for hospitals and hospital units excluded from the prospective 
payment systems. These changes would be applicable to discharges 
occurring on or after October 1, 1997.


Statement of Need:


Section 1886(e)(5) of the Social Security Act requires the Secretary to 
publish a proposed rule on prospective payment system policies and 
payment rates in the Federal Register by May 1 and a final rule by 
September 1.


Summary of the Legal Basis:


As noted above, publication of proposed and final rules concerning 
hospital PPS policies and payment rates is required by law. The statute 
sets forth several specific requirements concerning what must be 
included in the PPS proposed and final rules (See sections 
1886(b)(3)(B), 1886(d)(1)(A), 1886(d)(2)(H), 1886(d)(3)(A), 
1886(d)(3)(E), 1886(d)(4)(C), 1886(e)(4), 1886(e)(5), and 1886(g)(1)(A) 
of the Act.)


Alternatives:


Publication of these rules is not discretionary. Thus, no alternatives 
exist.


Anticipated Costs and Benefits:


We are unable to estimate at this time the costs and benefits 
associated with these rules.


Risks:


Not applicable.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           05/00/97
Final Action                                                   09/00/97
Small Entities Affected:


Businesses, Organizations


Government Levels Affected:


State, Federal


Additional Information:


BPD-878


Agency Contact:
Charles Booth
Director, Office of Hospital Policy
Bureau of Policy Development
Department of Health and Human Services
Health Care Financing Administration
C5-02-23
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-4487
RIN: 0938-AH55
_______________________________________________________________________
HHS--HCFA
34.  IMPROVEMENTS TO THE APPEAL PROTECTIONS OFFERED BY MEDICARE 
CONTRACTING HMOS/CMPS (OMC-025-P)
Priority:


Other Significant


Legal Authority:


 42 USC 1395mm(c)(5)(A)


CFR Citation:


 42 CFR 417 subpart Q


Legal Deadline:


None


Abstract:


Medicare contracting Health Maintenance Organizations (HMOs) and 
Competitive Medical Plans (CMPs) as well as Health Care Prepayment 
Plans (HCPPs) are required to provide Medicare enrollees with a 
decision (called an ``initial organization

[[Page 62059]]

determination'') as to whether a service will be provided or a claim 
paid. Contracting health plans must also provide a second level of 
review (called a ``reconsideration'') if the initial decision is 
adverse to the beneficiary and the Medicare enrollee requests the 
reconsideration. At both levels, the health plan has a regulatory 60-
day time frame for responding to the beneficiary, regardless of whether 
it is a service denial or a retrospective claims denial. This 
regulation would revise these time frames and distinguish service-
related decisions (i.e., preservice denials, terminations of services, 
and reductions in services) from claims for payment, as well as 
establish an expedited review requirement. This regulation would 
require, at both the initial and reconsideration levels, that: standard 
service-related decisions be made with 20 working days; review of 
expedited cases be made within a time period appropriate to the 
situation but, generally, not exceeding 72 hours; and claims within an 
appropriate period not to exceed 60 days.


Statement of Need:


Results of HCFA's efforts to gain more beneficiary input and studies by 
various external organizations clearly indicate the need for more rapid 
turnaround on decisions involving medically necessary, covered 
services. Delays in such decisions could affect quality of care and the 
health status of Medicare enrollees. In addition, the need for 
expedited review in cases where a beneficiary's life, health status, or 
ability to function could be in serious jeopardy has been identified, 
and is becoming increasingly available to under-65 enrollees of managed 
care plans. Last, there has been confusion as to the appeal rights of 
Medicare enrollees who have received covered services, particularly 
from skilled nursing facilities and home health agencies, but for whom 
such services are subsequently terminated or reduced. This rule would 
clarify the Medicare enrollee's right to appeal in these situations.


Summary of the Legal Basis:


Section 1876(c)(5)(A) of the Social Security Act requires that the 
contracting HMO/CMP provide meaningful procedures for hearing and 
resolving grievances between the organization and the member. Subpart Q 
of 42 part 417 sets forth specific regulatory requirements for 
implementation of this provision. In a final regulation issued in 
November 1994, HCPPs were required to provide the appeal protections of 
this subpart.


Alternatives:


Various time frames for conducting preservice and other service-related 
denials were considered. This regulation proposes following time frames 
being recommended for adoption by the National Association of Insurance 
Commissioners (NAIC) in their Health Carrier Grievance Procedure Model 
Act, which will likely be used by State legislatures as a licensure 
requirement for HMOs and other managed care plans. Conformity with NAIC 
model requirements will enhance consumer/beneficiary understanding and 
utilization of appeal protections, eliminate confusion on the part of 
health plan staff responsible for the appeals process, and improve plan 
performance in this area.


Anticipated Costs and Benefits:


Although the costs and benefits associated with this rulemaking have 
not yet been estimated, no significant budgetary impact is anticipated. 
Medicare contracting health plans would experience additional costs 
associated with these appeals improvements, including a higher volume 
of appeals. These costs would be absorbed within the plans' Medicare 
payment amount. HCFA will experience some additional administrative 
costs associated with expansion of its reconsideration contract. These 
costs are justified by the improved protections available to 
beneficiaries who choose Medicare managed care. The appeals process is 
an integral and critical component to prepaid, managed systems of care. 
That is, the incentives of prepaid health plans to manage utilization 
of services is balanced by quality checks and balances, including the 
appeals process. A strong appeals process helps ensure that Medicare 
enrollees receive all medically necessary covered services.


Risks:


There is bipartisan and industry support for this rule and there are no 
apparent risks.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           12/00/96
Small Entities Affected:


None


Government Levels Affected:


Federal


Additional Information:


OMC-025


Agency Contact:
Maureen Miller
Office of Managed Care
Department of Health and Human Services
Health Care Financing Administration
S3-21-17
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-1097
RIN: 0938-AH62
_______________________________________________________________________
HHS--HCFA

                              -----------

                            FINAL RULE STAGE

                              -----------

35. REVISIONS TO REGULATIONS IMPLEMENTING CLIA (HSQ-226-F)
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 42 USC 263a


CFR Citation:


 42 CFR 493


Legal Deadline:


None


Abstract:


This rule would respond to public comments received on a final rule 
published on February 28, 1992. The rule revised regulations applicable 
to laboratories and implemented provisions of the Clinical Laboratory 
Improvement Amendments of 1988 (CLIA), Public Law 100-578. The 
regulations apply to laboratories that examine human specimens for the 
diagnosis, prevention, or treatment of any disease or impairment of, or 
the assessment of the health of, human beings. They specify the 
performance requirements, based on test complexity and risk factors 
related to erroneous test results as required by CLIA, that apply to 
laboratories that are subject to CLIA. They also list requirements that 
permit waiver of the certification and inspection requirements for 
laboratories performing only limited testing. This rule is part of the 
Administration's

[[Page 62060]]

reinventing government and regulatory reform initiatives.


Statement of Need:


On October 31, 1988, the Congress enacted comprehensive changes to 
existing laboratory regulations in CLIA. This statute requires the 
regulation of any facility (including physician offices) that performs 
tests on human beings for the purpose of providing information for the 
diagnosis, prevention, or treatment of any disease or impairment of, or 
the assessment of the health of, human beings. Historically, the 
Department had regulated laboratories by ``location,'' rather than by 
the types of tests they performed. CLIA requires that the Department 
regulate by test, using what is commonly referred to as the 
``complexity model'' to categorize individual laboratory tests based on 
the experience, skills, and judgment required to perform each test 
accurately. Requirements vary as a function of the complexity of the 
tests the laboratory conducts.
The law requires the Secretary to implement the numerous provisions 
through regulation to ensure the quality of laboratory testing, 
regardless of where it is provided or who is providing the testing. The 
law also requires the CLIA program be operated through the assessment 
of user fees paid by entities subject to these requirements.
On May 21, 1990, the Department published proposed rules to implement 
CLIA and received public comments from over 60,000 commenters. Based on 
analysis of these comments, the Centers for Disease Control and 
Prevention with the Health Care Financing Administration developed a 
final rule with comment period that set forth standards for all 
entities performing laboratory testing based on test complexity. This 
rule was published on February 28, 1992, and was effective September 1, 
1992. This regulation was revised by regulations with comment period 
published on January 19, 1993, December 6, 1994, and April 24, 1995.
Issues that will be addressed in this rule include quality control, 
quality assurance, personnel standards, cytology requirements; 
proficiency testing (PT) requirements; employee workplace drug testing; 
and other issues raised by commenters based on experience with CLIA 
implementation.
The Clinical Laboratory Improvement Advisory Committee (CLIAC), which 
is composed of members of professional organizations and private 
citizens, is actively involved in making recommendations regarding 
technical and scientific aspects of the regulations. In addition, we 
actively solicit comments from outside organizations such as the 
American Medical Association, the Association of State and Territorial 
Public Health Laboratory Directors, and other professional and medical 
organizations regarding the interpretive guidelines for surveyors.


Summary of the Legal Basis:


This rule summarizes and responds to CLIAC recommendations and public 
comments to four previously published CLIA regulations.


Alternatives:


HHS is currently developing a final rule that will address comments 
received on the final rule with comment period published February 28, 
1992, and further comments received in response to the January 19, 
1993, December 6, 1994, and April 24, 1995 rules with comment period. 
Based on these comments, modifications to improve the cost-
effectiveness of the CLIA standards are under consideration.


Anticipated Costs and Benefits:


It is not possible to project costs and benefits of the rule at this 
time. These regulations serve to ensure consistent, reliable laboratory 
testing that is an integral part of ensuring that individuals receive 
appropriate treatment.


Risks:


Inferior and inappropriate laboratory testing can result in 
misdiagnosis causing patient harm. CLIA reduces the potential for 
inaccurate diagnosis resulting from poorly performed laboratory testing 
since entities must meet requirements (e.g., quality assurance, 
proficiency testing, quality control, personnel requirements) that have 
a direct impact on laboratory testing results. Overly stringent 
standards could, however, discourage needed testing and reduce early 
detection of health problems. The Department does not at this time have 
an estimate of the magnitude and severity of these types of risks, but 
believes that both the original regulations and the revisions will on 
balance contribute to better diagnosis.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM            55 FR 20896                                    05/21/90
NPRM Comment Period End                                        09/21/90
Final Rule With 57 FR 7002riod                                 02/28/92
Comment Period End                                             04/28/92
Effective Date                                                 09/01/92
Final Rule Effective Date                                      01/19/93
Final Rule With 58 FR 5215riod                                 01/19/93
Comment Period End                                             03/22/93
Final Action                                                   09/00/97
Small Entities Affected:


Businesses


Government Levels Affected:


None


Additional Information:


HSQ-226


Agency Contact:
Anthony J. Tirone
Deputy Director for Survey & Certification
Health Standards and Quality Bureau
Department of Health and Human Services
Health Care Financing Administration
S2-19-26
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-6763
RIN: 0938-AE47
_______________________________________________________________________
HHS--HCFA
36. CLIA PROGRAM: CATEGORIZATION OF WAIVED TESTS (HSQ-225-F)
Priority:


Other Significant


Reinventing Government:


This rulemaking is part of the Reinventing Government effort. It will 
revise text in the CFR to reduce burden or duplication, or streamline 
requirements.


Legal Authority:


 42 USC 263a


CFR Citation:


 42 CFR 493.2; 42 CFR 493.7; 42 CFR 493.9; 42 CFR 493.15; 42 CFR 
493.20; 42 CFR 493.25; 42 CFR 493.35; 42 CFR 493.37; 42 CFR 493.39; 42 
CFR 493.45; 42 CFR 493.47; 42 CFR 493.49; 42 CFR 493.53; 42 CFR 
493.1775


Legal Deadline:


None


Abstract:


As part of the CLIA program (see RIN: 0938-AE47), this rule will revise 
our

[[Page 62061]]

current process of evaluating tests against generic criteria. A waiver 
will be granted to any test that meets the statutory criteria, provided 
that scientifically valid data are submitted verifying that the 
criteria were met.


Statement of Need:


This final rule will clarify and expand the waiver criteria and 
streamline the waiver process so that more tests may be categorized as 
waived; that is, free from CLIA performance and personnel requirements.


Summary of the Legal Basis:


The Clinical Laboratory Improvement Advisory Committee (CLIAC) was 
established to advise and make recommendations on technical and 
scientific aspects of the regulations. The CLIAC recommended that the 
criteria for categorizing tests as waived be better defined. As a 
result of the comments concerning waived tests and the CLIAC 
recommendations, the Centers for Disease Control and Prevention 
developed criteria for placing tests in the waived category as outlined 
in this proposal.


Alternatives:


Performance standards based on current analysis specific criteria would 
have limited technology and impeded innovative ideas.


Anticipated Costs and Benefits:


This regulation decreases burden, especially for physician office 
laboratories due to virtually no regulatory oversight. It increases 
access to a greater variety of tests. Physician office laboratories may 
expand the range of tests they perform without an increase in costs/
burden. The regulation creates incentives for manufacturers to develop 
more test systems that meet the clarified waiver criteria and criteria 
for approval for home use. It eliminates inspection fees for many of 
the 60,000 physician offices and other small laboratories performing 
tests that will fall into the expanded waived category.


Risks:


The expansion of the waived criteria and development of a process 
protocol will provide for consistent application of detailed standards 
in order to ensure that tests categorized as waived preclude any 
reasonable risk of harm to patient as a result of testing error.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM            60 FR 47534                                    09/13/95
NPRM Comment Period End                                        11/13/95
Final Action                                                   04/00/97
Small Entities Affected:


None


Government Levels Affected:


None


Additional Information:


HSQ-225


Agency Contact:
Anthony Tirone
Deputy Director for Survey & Certification
Health Standards & Quality Bureau
Department of Health and Human Services
Health Care Financing Administration
S2-19-26
7500 Security Blvd.
Baltimore, MD 21244
Phone: 410 786-6810
RIN: 0938-AG99
_______________________________________________________________________
HHS--HCFA
37. MEDICARE PROGRAM: REVISIONS TO PAYMENT POLICIES AND FIVE-YEAR 
REVIEW OF AND ADJUSTMENTS TO RELATIVE VALUE UNITS UNDER THE PHYSICIAN 
FEE SCHEDULE FOR CALENDAR YEAR 1997 (BPD-852-FC)
Priority:


Economically Significant. Major under 5 USC 801.


Legal Authority:


 42 USC 1395w-4


CFR Citation:


 42 CFR 41O; 42 CFR 415; 42 CFR 410; 42 CFR 411; 42 CFR 412; 42 CFR 
413; 42 CFR 414; 42 CFR 415; 42 CFR 417; 42 CFR 489


Legal Deadline:


 Final, Statutory, January 1, 1997.


Abstract:


This rule discusses several changes affecting policies for specific 
physician services and the relative value schedule for calendar year 
1997 including locality changes and Medicare payment for diagnostic 
services and transportation in connection with furnishing diagnostic 
tests. The rule implements section 1848 of the Social Security Act.


Statement of Need:


The Omnibus Budget Reconciliation Act (OBRA) of 1989 changed the basis 
of the Medicare physician payment system from reasonable charge to a 
fee schedule based on relative value units (RVUs). The fee schedule was 
first implemented in 1992. This regulation will announce the RVUs upon 
which Medicare payment for physician services will be based in 1997. 
The public was given a 60-day period to comment on the interim values. 
It will also explain the process by which the interim RVUs were 
reviewed and, in some cases, revised as a result of public comments.
After four full years of experience with the physician fee schedule, we 
continue to reevaluate related payment policies. Proposed revisions to 
these policies were announced in a notice of proposed rulemaking on 
July 2, 1996. This final rule will respond to the public comments 
received on those proposals and announce the final policy decisions. 
Thus, it will discuss changes in payment localities; special rules for 
the payment of diagnostic tests, including diagnostic radiology 
procedures; transportation in connection with furnishing diagnostic 
tests; changes in the status of certain services; and technical changes 
in our rules for payments to supervising physicians in teaching 
settings.
In addition, this regulation will discuss the changes made as a result 
of the 5-year review of physician work relative values mandated by the 
statute. In this regard, we have and will continue to work with the 
physician community through the American Medical Association Specialty 
Society Relative Value Update Committee.


Summary of the Legal Basis:


42 USC 1395w-4


Alternatives:


An alternative to this rulemaking would be to continue to base payments 
on 1996 RVUs. This would continue inappropriate payments for certain 
services and would not allow a national basis for paying for new rule. 
By not revising the payment policies described in this notice, we would 
continue inadequate or inequitable payments for certain physician 
services.


Anticipated Costs and Benefits:


Section 1848(c)(2)(B) of the Social Security Act requires that 
adjustments to RVUs for a year may not cause the amount of expenditures 
to differ by more than $20 million from the amount of expenditures if 
the adjustments had not been made. In general, the payment policies and 
other revisions included in

[[Page 62062]]

this rule will be implemented in a budget-neutral manner. Although this 
is viewed as an economically significant rule under 5 USC 801, total 
Medicare expenditures will not be increased or decreased as a result of 
most of these changes.


Risks:


Not applicable


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM            61 FR 34614                                    07/02/96
NPRM Comment Period End                                        09/03/96
Final Rule with Comment Period                                 01/00/97
Small Entities Affected:


None


Government Levels Affected:


None


Additional Information:


BPD-852


Agency Contact:
Terrence Kay
Director, Division of Physician Services
Department of Health and Human Services
Health Care Financing Administration
C4-10-26
7500 Security Boulevard
Baltimore, MD 21244
Phone: 410 786-4497
RIN: 0938-AH40
_______________________________________________________________________
HHS--HCFA
38.  HEALTH INSURANCE REFORM: PORTABILITY AND NONDISCRIMINATION 
IN THE GROUP INSURANCE MARKET; PORTABILITY IN THE INDIVIDUAL INSURANCE 
MARKET; REQUIREMENTS ON STATE FOR ALTERNATIVE MECHANISMS FOR REG
Priority:


Economically Significant. Major under 5 USC 801.


Unfunded Mandates:


Undetermined


Legal Authority:


 PL 104-191, sec 102; PL 104-191, sec 111


CFR Citation:


 Not yet determined


Legal Deadline:


 Final, Statutory, April 1, 1997.


Abstract:


This interim final rule will include policies for group and individual 
markets on portability, availability, and renewability. It will: (1) 
guarantee access to health insurance for firms with fewer than 51 
employees and to all individuals in those groups; (2) limit the use of 
pre-existing conditions exclusions in the group market; (3) guarantee 
access to individual converage for people who lose their group 
coverage; and (4) set forth requirements imposed on health insurance 
issuers. It will also establish rules that would apply to a State where 
its alternative mechanism is disapproved or its is determined that the 
State is not substantially enforcing the portability provisions 
governing health insurance issuers in the State.


Statement of Need:


The Health Insurance Portability and Accountability Act of 1996, 
(HIPPA, or Pub. L. 104-191) requires the Secretaries of Labor, 
Treasury, and Health and Human Services to promulgate implementing 
regulations for that Act by April 1, 1996. If this is not done timely, 
the effective date of the protections under the law shall be delayed, 
with potential harm to protected eligible individuals.


Summary of the Legal Basis:


HIPAA includes provision at a new section 2792 of the Public Health 
Service Act requiring and authorizing the Secretary of Health and Human 
Services to promulgate such regulations as may be necessary or 
appropriate to carry out the provisions of the Act. Other provisions of 
the Act specify implemented through regulation.


Alternatives:


HIPAA requires that its provisions be implemented through regulations. 
This is a new area for Federal oversight, and no related prior 
regulations exist.


Anticipated Costs and Benefits:


These rules will benefit eligible individuals by assuring them of 
continuity of health coverage when they lose coverage under a group 
health plan as a result of termination of employment, or as a result of 
certain other events, of the individul or of a person under whose 
coverage the individual had been a dependent. As a result, many people 
will not become uninsured, and many others will be able to maintain 
coverage without the imposition of new pre-existing condition 
limitations on coverage.
This regulation will assist small employers by assuring that they will 
have access to group coverage for their employees in the small group 
market. It also will impose costs on small insurance companies. 
Overall, there may some increase in premium costs for all participants 
in the small group and individual insurance markets.
A full cost analysis is not complete. Congressional Budget Office 
analyses of the impact on plans and insurers of mandated coverage 
showed the cost of that coverage would be on the order of $400 million 
annually.


Risks:


The promulgation of there regulaitons will put in place protections in 
the insurance market that will assure eligible individuals continuity 
of coverage and relief of new pre-existing condition limits. Failure to 
timely promulgate these regulations will delay their effect, and will 
result in harm to some of those individuals who would otherwise have 
been protected.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
Interim Final Rule with Comment Period                         04/00/97
Small Entities Affected:


Businesses, Governmental Jurisdictions, Organizations


Government Levels Affected:


State, Local, Federal


RIN: 0938-AH75
_______________________________________________________________________
HHS--Administration for Children and Families (ACF)

                              -----------

                          PROPOSED RULE STAGE

                              -----------

39.  TANF AUDITS/PENALTIES AND CORRECTIVE ACTIONS
Priority:


Other Significant


Legal Authority:


 PL 104-193


CFR Citation:


 45 CFR 201


Legal Deadline:


None


Abstract:


This regulation will discuss the audit and penalty requirements of TANF 
and

[[Page 62063]]

will include a discussion of the reasonable cause exception, a 
description of corrective compliance plans, and provide information on 
an appeals process.


Statement of Need:


This regulation is necessary to implement the provision of the new 
welfare reform legislation requiring penalties and corrective actions 
be taken in certain, specified situations.


Summary of the Legal Basis:


Section 409 and section 410 of the Social Security Act, as amended by 
the Personal Responsibility and Work Opportunity Reconciliation Act of 
1996.


Alternatives:


There are no viable alternatives.


Anticipated Costs and Benefits:


No additional costs to the public.


Risks:


None.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           01/00/97
Small Entities Affected:


None


Government Levels Affected:


State, Tribal, Federal


Agency Contact:
Mack Storrs
Director
Division of Self-Sufficiency Programs
Department of Health and Human Services
Administration for Children and Families
Office of Family Assistance
370 L'Enfant Promenade SW.
Washington, DC 20447
Phone: 202 401-9289
Fax: 202 205-5887
Email: MS[email protected]
RIN: 0970-AB76
_______________________________________________________________________
HHS--ACF
40.  TANF WORK REQUIREMENTS
Priority:


Other Significant


Legal Authority:


 PL 104-193


CFR Citation:


 45 CFR 204


Legal Deadline:


None


Abstract:


This regulation will describe the work participation rate requirements 
of welfare reform, discuss the two-year time limit for receiving TANF 
benefits, and will explain how participation rates can be reduced based 
on caseload reductions.


Statement of Need:


This regulation is necessary to help States fully understand their 
responsibilities to assure welfare recipients will be able to leave 
welfare and enter the work force within prescribed periods of time.


Summary of the Legal Basis:


Section 407 of the Social Security Act, as amended by the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996.


Alternatives:


There are no viable alternatives.


Anticipated Costs and Benefits:


No additional costs to the public.


Risks:


None.


Timetable:
_______________________________________________________________________
Action                                 DFR Cite

_______________________________________________________________________
NPRM                                                           03/00/97
Small Entities Affected:


None


Government Levels Affected:


State, Tribal, Federal


Agency Contact:
Mack Storrs
Director
Division of Self-Sufficiency Programs
Department of Health and Human Services
Administration for Children and Families
Office of Family Assistance
370 L'Enfant Promenade SW.
Washington, DC 20447
Phone: 202 401-9289
Fax: 202 205-5887
Email: MS[email protected]
RIN: 0970-AB77
BILLING CODE 4150-04-F