On February 4, 2013, CMS proposed certain reforms to Medicare regulations that would eliminate or change rules seen as unnecessary, obsolete, or excessively burdensome on hospitals and other health care providers.  The proposed rule is in line with President Obama’s call on federal agencies to reduce regulatory burdens on business.  All told, CMS projects its proposals would save $676 million annually, and $3.4 billion over five years.

Among the key changes proposed are the following:

Ambulatory Surgery Centers (ASCs): The proposed rule would reduce regulatory requirements that ASCs must meet in order to provide radiological services, and provide greater flexibility in the types of physicians who may supervise such services in an ASC.  Currently, ASCs must satisfy full hospital requirements for furnishing radiological services.  The proposed rule would only require compliance with the standard governing safety for patients and personnel and with certain personnel and records requirements.  If adopted, the proposed rules would also permit an MD/DO who is qualified by education and experience and ASC policy to supervise the provision of radiologic services.  Currently, a radiologist must supervise the provision of radiological services in an ASC.

Hospitals: The proposal includes several changes to the hospital conditions of participation (COPs).  The changes would impact the COPs addressing governance, medical staff, food and dietetic services, nuclear medicine services, outpatient services, and classification of swing bed services. For example, under the proposed rule,

• The hospital no longer would need representatives of the medical staff to sit on the governing body.  The governing body would need to consult periodically with the individual responsible for the organized medical staff of the hospital.
• The hospital would be required to have an organized and individual medical staff, distinct to the individual hospital, that operates under the bylaws of the governing body, and which is responsible for the quality of medical care provided to patients of the individual hospital.
• The food and dietetic services COP would be changed to include that a therapeutic diet may be ordered by a qualified dietician, as authorized by the medical staff and in accordance with State law.
• The COP for nuclear medicine services would be changed to allow for in-house preparation of radiopharmaceuticals by, or under the supervision of, an appropriately trained registered pharmacist or an MD or DO.  CMS, therefore, is proposing to remove the direct supervision requirement for the in-house preparation of radiopharmaceuticals.
• CMS is proposing the addition of a new standard governing orders for outpatient services.  Orders for outpatient services may be made by any practitioner who is responsible for the care of the patient; licensed in the State where he or she provides care to the patient; acts within the scope of practice under state law; and is authorized in accordance with the policies adopted by the medical staff and approved by the governing body to order applicable outpatient services.  The standard would apply to all practitioners appointed to the hospital’s medical staff and who have been granted privileges to order outpatient services.  It also applies to practitioners not appointed to the medical staff, but who satisfy the criteria for authorization by a hospital for ordering outpatient services for their patients.
• CMS has proposed moving the COPs for swing bed services from Subpart E (requirements for specialty hospitals) to Subpart D, which provides COPs for optional services.  The change would allow compliance with swing bed requirements to be evaluated during routine accrediting organization surveys.  Thus, CMS would no longer require a separate, additional survey specifically for swing bed approval.

Transplant Centers: CMS is proposing changes to the COPs governing transplant programs.  Specifically, the rule would eliminate redundant data submission requirements and provide greater flexibility in the re-approval cycle. 

Long-Term Care Hospitals: CMS is proposing providing a process for LTCH’s to apply for a deadline extension for the requirement to have an automatic sprinkler system installed in the building by August 13, 2013.

Rural Health Providers: CMS makes various proposals affecting the COPs for critical access hospitals (CAHs), rural health clinics (RHCs), and federally-qualified health centers (FQHCs).  For example, CMS would eliminate the need for a CAH to develop its patient care policies with at least one member who is not a member of the CAH’s staff.  It would revise RHC/FQHC rules to eliminate the requirement that a physician be onsite at least once every two weeks.  CMS also is soliciting comments on whether other possible changes might be appropriate to reduce barriers to service, such as in the area of telehealth services, hospice services, and home health services.

In addition to the above, CMS is proposing changes to the Clinical Laboratory Improvement Act (CLIA) regulations.  These changes would provide greater clarity to the treatment of proficiency testing samples, provide an exception to CMS’s long standing interpretation of what constitutes an “intentional” referral of proficiency testing samples, and provide new definitions for reflex testing, confirmatory testing, and repeat proficiency testing referral. 

Comments on the proposed rules are due no later than 5:00 pm on April 8, 2013.  The proposed rule was published on February 7, 2013 in the Federal Register. To view the proposed rule click here.

Reporter, Tracy Weir, Washington, D.C.,  +1 202 626 2923, tweir@kslaw.com .