Medicare Program; Health Care Infrastructure Improvement Program; Forgiveness of Indebtedness, 57376-57382 [05-19307]

Agencies

• Centers for Medicare & Medicaid Services
• DEPARTMENT OF HEALTH AND HUMAN SERVICES

[Federal Register Volume 70, Number 189 (Friday, September 30, 2005)]
[Proposed Rules]
[Pages 57376-57382]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-19307]



Federal Register / Vol. 70, No. 189 / Friday, September 30, 2005 / 
Proposed Rules

[[Page 57376]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 Part CFR 505

[CMS-1320-P]
RIN 0938-AN93


Medicare Program; Health Care Infrastructure Improvement Program; 
Forgiveness of Indebtedness

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

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement section 1016 of the 
Medicare Prescription Drug, Improvement and Modernization Act of 2003 
(MMA) (Pub. L. 108-173) by establishing the loan forgiveness criteria 
for qualifying hospitals who receive loans under the Health Care 
Infrastructure Improvement Program.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided below, no later than 5 p.m. on November 29, 
2005.

ADDRESSES: In commenting, please refer to file code CMS-1320-P. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of three ways (no duplicates, 
please):
    1. Electronically. You may submit electronic comments on specific 
issues in this regulation to https://www.cms.hhs.gov/regulations/
ecomments. (Attachments should be in Microsoft Word, WordPerfect, or 
Excel; however, we prefer Microsoft Word.)
    2. By mail. You may mail written comments (one original and two 
copies) to the following address ONLY: Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, Attention: CMS-1320-
P, P.O. Box 8020, Baltimore, MD 21244-8020.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments (one original and two copies) before the 
close of the comment period to one of the following addresses. If you 
intend to deliver your comments to the Baltimore address, please call 
telephone number (410) 786-9994 in advance to schedule your arrival 
with one of our staff members.

Room 445-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW., 
Washington, DC 20201; or
7500 Security Boulevard, Baltimore, MD 21244-1850.

    (Because access to the interior of the HHH Building is not readily 
available to persons without Federal Government identification, 
commenters are encouraged to leave their comments in the CMS drop slots 
located in the main lobby of the building. A stamp-in clock is 
available for persons wishing to retain a proof of filing by stamping 
in and retaining an extra copy of the comments being filed.)
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and received after the comment 
period.
    Submission of comments on paperwork requirements. You may submit 
comments on this document's paperwork requirements by mailing your 
comments to the addresses provided at the end of the ``Collection of 
Information Requirements'' section in this document.
    For information on viewing public comments, see the beginning of 
the SUPPLEMENTARY INFORMATION section.

FOR FURTHER INFORMATION CONTACT:
Tzvi Hefter, (410) 786-4487 (For information on the loan terms).
Melinda Jones (410) 786-7069 (For information on loan forgiveness 
criteria).

SUPPLEMENTARY INFORMATION:
    Submitting Comments: We welcome comments from the public on all 
issues set forth in this proposed rule to assist CMS in fully 
considering issues and developing policies. You can assist CMS by 
referencing the file code CMS-1320-P and the specific ``issue 
identifier'' that precedes the section on which you choose to comment.
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. CMS posts all electronic 
comments received before the close of the comment period on its public 
Web site as soon as possible after they have been received. Hard copy 
comments received timely will be available for public inspection as 
they are received, generally beginning approximately 3 weeks after 
publication of a document, at the headquarters of the Centers for 
Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, 
Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 
p.m. To schedule an appointment to view public comments, phone 1-800-
743-3951.

I. Background

    Section 1016 of the Medicare Prescription Drug, Improvement and 
Modernization Act of 2003 (MMA) (Pub. L. 108-173) amended Title XVIII 
of the Social Security Act (the Act) to establish section 1897 of the 
Act, the Health Care Infrastructure Improvement Program (Loan Program). 
Section 1897 of the Act authorizes the Secretary of the U.S. Department 
of Health and Human Services (Secretary) to establish a loan program 
that provides loans to qualifying hospitals for payment of the capital 
costs of eligible projects.
    Section 1897(c) as amended by Section 6045 of the Emergency 
Supplemental Appropriations Act for Defense, the Global War on Terror, 
and Tsunami Relief, 2005 (Tsunami Relief Act of 2005) (Pub. L. 109-13) 
defines a qualifying hospital as a hospital or entity that is engaged 
in research in the causes, prevention, and treatment of cancer; and is 
designated as a cancer center by the National Cancer Institute (NCI) or 
is designated by the State legislature as the official cancer institute 
of the State and such designation by the State legislature occurred 
prior to December 8, 2003. Section 1897(c)(3) of the Act also specifies 
that an entity has the same meaning as specified in section 501(c)(3) 
of the Internal Revenue Code of 1986 and is exempt from tax under 
section 501(a) of the Code; has at least one existing memorandum of 
understanding or affiliation agreement with a hospital located in the 
State in which the entity is located; and retains clinical outpatient 
treatment for cancer on site as well as lab research and education and 
outreach for cancer in the same facility.
    Section 1897(d) of the Act specifies that an eligible project is a 
project of a qualifying hospital that is designed to improve the health 
care infrastructure of the hospital, including construction, 
renovation, or other capital improvements.
    Section 1897(f) of the Act states that the Secretary may forgive a 
loan provided to a qualifying hospital, under terms and conditions that 
are analogous to the loan forgiveness provision for student loans under 
part D of title IV of the Higher Education Act of 1965, (20 U.S.C.1087a 
et seq.). However, the Secretary shall condition such forgiveness on 
the establishment by the hospital of--(1) An outreach program for 
cancer prevention, early diagnosis and treatment that provides services 
to a substantial majority of the residents of the State or region, 
including residents of rural areas; (2) an outreach program for cancer 
prevention, early diagnosis,

[[Page 57377]]

and treatment that provides services to multiple Indian Tribes; and (3) 
unique research resources (such as population databases); or an 
affiliation with an entity that has unique research resources.
    Also, section 1897(h) of the Act states that the Secretary shall 
submit to Congress a report on the projects for which loans are 
provided under this section and a recommendation as to whether Congress 
should authorize the Secretary to continue loans under this section 
beyond fiscal year 2008.
    Furthermore, prior to the Tsunami Relief Act of 2005, section 
1897(g)(1) of the Act appropriated $200,000,000 to carry out the loan 
program. The funds allocated for the loan program are to remain 
available during the period beginning on July 1, 2004, and ending on 
September 30, 2008. However, the Congress rescinded $58,000,000 leaving 
$142,000,000 available for the loan program. The statute also states 
that not more than $2,000,000 can be used for the administration of the 
loan program for each of the fiscal years (that is, 2004 through 2008). 
No administrative funding was used in fiscal year 2004.
    In addition, section 1897(i) of the Act as amended by section 
6045(b) of the Tsunami Relief Act of 2005 states that there shall be no 
administrative or judicial review of any determination made by the 
Secretary under this section.

II. Provisions of the Proposed Regulation

    Section 1897 of the Act authorizes the Secretary to establish a 
loan program that provides loans to qualifying hospitals for payment of 
the capital costs of qualifying projects. Section 1897 of the Act also 
requires that criteria be established for--(1) selecting among 
qualifying hospitals that apply to participate in the loan program; and 
(2) the forgiving of indebtedness (hereinafter referred to as loan 
forgiveness). This proposed rule would establish the loan forgiveness 
criteria for qualifying hospitals that participate in the loan program. 
We are publishing a separate rulemaking document for selecting 
qualifying hospitals to participate in the Health Care Infrastructure 
Improvement program (loan program).

A. Conditions for Loan Forgiveness (Proposed Sec.  505.13)

[If you choose to comment on issues in this section, please include the 
caption ``Conditions for Loan Forgiveness'' at the beginning of your 
comments.]

    Section 1897(f) of the Act authorizes the Secretary to forgive a 
loan provided to a qualifying hospital under terms and conditions that 
are analogous to the loan forgiveness provision for student loans under 
part D of title IV of the Higher Education Act of 1965 [20 U.S.C. 1087a 
et seq.). The student loan program specifies that in order to be 
eligible for loan forgiveness, borrowers are required to satisfy 
certain conditions, such as, completing a service obligation which 
satisfies certain terms and conditions as determined by the Secretary. 
Therefore, we propose to apply the loan forgiveness model of the 
student loan program and require that a hospital complete a service 
obligation which satisfies certain terms and conditions in order to 
qualify for loan forgiveness. That is, we are proposing that to fulfill 
the service obligation borrowers must meet the loan forgiveness 
conditions discussed herein that are based on section 1897(f) of the 
Act which states that the Secretary shall condition such forgiveness on 
the establishment by the hospital of--(1) an outreach program for 
cancer prevention, early diagnosis, and treatment that provides 
services to a substantial majority of the residents of a State or 
region, including residents of rural areas; (2) an outreach program for 
cancer prevention, early diagnosis, and treatment that provides 
services to multiple Indian tribes; and (3) unique research resources 
(such as population databases); or an affiliation with an entity that 
has unique research resources.
    In addition, we are proposing that the qualifying hospital must 
submit a written request for loan forgiveness to CMS by the effective 
date of the final rule.
    Furthermore, we are proposing specific criteria that a qualifying 
hospital must follow to meet the conditions for loan forgiveness.

B. Plan Criteria for Meeting the Conditions for Loan Forgiveness 
(Proposed Sec.  505.15)

[If you choose to comment on issues in this section, please include the 
caption ``Criteria for meeting the conditions for loan forgiveness'' at 
the beginning of your comments.]

    In order to qualify for loan forgiveness, the qualifying hospital 
must meet the specific criteria proposed at Sec.  505.13. We would 
organize the loan forgiveness criteria into 3 domains. These domains 
are consistent with the section 1897(f)(A),(B), and (C) of the Act. The 
three proposed domains are--(1) Outreach program for cancer prevention, 
early diagnosis, and treatment that provides services to a substantial 
majority of the residents of a State or region, including residents of 
rural areas; (2) outreach program for cancer prevention, early 
diagnosis, and treatment that provides services to multiple Indian 
tribes; and (3) unique research resources (such as population 
databases); or an affiliation with an entity that has unique research 
resources.
    In proposed Sec.  505.3, we would define ``outreach programs'' as 
formal cancer programs for teaching, diagnostic screening, therapy or 
treatment, prevention, or interventions to enhance the health and 
knowledge of their designated population(s). Likewise, we are proposing 
to define ``unique research resources'' as resources that are used for 
the purpose of discovering or testing options related to the causes, 
prevention, and treatment of cancer. We are soliciting comments on 
these definitions.
    We are proposing at Sec.  505.13(c) that the qualifying hospital 
must submit to CMS by the timeframe specified by the Secretary the 
following: (1) A written request for loan forgiveness; (2) a plan 
describing how the qualifying hospital would establish, implement or 
maintain existing outreach programs for its targeted populations; and 
(3) how it would establish or maintain existing unique research 
resources over the loan deferment period. We propose to make that 
timeframe 60 days after the publication of the final rule.
    We are also proposing in Sec.  505.15 that the qualifying hospital 
designate in its plan, the population(s) for which it would target its 
outreach programs and be held accountable in the assessment for loan 
forgiveness. The qualifying hospital's target populations for the 
outreach programs must include a substantial majority of the residents 
of a State or region, including residents of rural areas and multiple 
Indian tribes that the qualifying hospital services. We are proposing 
that the qualifying hospital must describe how it would designate the 
targeted populations to include residents of rural areas. CMS also 
proposes that for a list of Indian tribes eligible for inclusion in the 
target population, qualifying hospitals would refer to the notice on 
``Indian Entities Recognized and Eligible to Receive Services from the 
United States Bureau of Indian Affairs.'' The most recent notice was 
published in the Federal Register on December 5, 2003 (68 FR 68180). 
Qualifying hospitals should use this list when designating the target 
population for outreach programs servicing multiple Indian tribes in 
its plan to CMS.
    We invite public comments on the type of information that must be 
included in the plan and the timeframe

[[Page 57378]]

for a qualifying hospital to submit its plan to CMS. We are also 
soliciting comments on whether we should provide more specific criteria 
for the qualifying hospital to use in defining its targeted 
populations.
    We believe that 60 days after the final rule publication date is 
reasonable time for qualifying hospitals intending to apply for loan 
forgiveness to prepare and submit their initial plan, since the loan 
deferment period is 60 months after notification of acceptance in the 
program and the qualifying hospital would be assessed on its 
performance during the loan deferment period.
    Furthermore, we believe that requiring the qualifying hospitals to 
submit a plan in which they would determine the targeted population, 
the types of cancers (that is, the cancer types to be considered), 
goals for improving prevention, diagnosis, and treatment, and the 
measures to track their progress in reaching the goals provides 
flexibility to the qualifying hospitals as they develop, implement, or 
maintain their outreach programs.
    We also believe that it is appropriate to request this level of 
detail from the qualifying hospitals because section 1897(h) of the Act 
requires the Secretary to submit a report to the Congress before fiscal 
year 2008. The report must indicate the projects for which loans are 
provided under this section and recommend whether the Congress should 
authorize the Secretary to continue loans under beyond fiscal year 
2008. Receiving this information from the qualifying hospitals is 
necessary for the Secretary to make a fully informed recommendation to 
the Congress.
1. Domain 1: Outreach Program That Services a Substantial Majority of 
the Residents of a State or Region, Including Residents of Rural Areas
    We are proposing that the qualifying hospitals plan include a 
description of how it would establish, develop, implement, or maintain 
an existing outreach program that services a substantial majority of 
the residents of a State or region, including residents of rural areas 
for cancer prevention, early diagnosis, and treatment over the loan 
deferment period including proposed intervention approaches. The plan 
must--(1) identify the target population in accordance with section 
1897(f)(A) of the Act; (2) identify the cancer type(s) that would be 
included in the outreach program and how they were determined; (3) 
describe the intervention approaches it would consider using in its 
outreach program; (4) propose goals for improvement in each of the 
three areas (that is, prevention, early diagnosis, and treatment) 
during the loan deferment period for each cancer type identified; and 
(5) identify measures that would be used to track annual progress in 
meeting the proposed goals in the three areas for each cancer type 
identified.
2. Domain 2: Outreach Program That Services Multiple Indian Tribes
    We are proposing that the qualifying hospitals plan include a 
description of how it would establish or develop, implement, or 
maintain an existing outreach program that services multiple Indian 
Tribes for cancer prevention, early diagnosis, and treatment over the 
loan deferment period including proposed intervention approaches. The 
plan must--(1) designate the target population using the notice on 
``Indian Entities Recognized and Eligible to Receive Services from the 
United States Bureau of Indian Affairs'' published in the Federal 
Register on December 5, 2003 (68 FR 68180), in order to meet the 
requirements at section 1897(f)(B) of the Act; (2) identify the cancer 
type(s) that would be included in the outreach program and how they 
were determined; (3) describe the intervention approaches it would 
consider using in its outreach program; (4) propose goals for 
improvement in each of the three areas (that is, prevention, early 
diagnosis, and treatment) during the loan deferment period for each 
cancer type identified; and (5) identify measures that would be used to 
track annual progress in meeting the proposed goals in the three areas 
for each cancer type identified.
3. Domain 3: Unique Research Resources or an Affiliation With an Entity 
That Has Unique Research Resources
    We are proposing that the qualifying hospital would describe in its 
plan how it would establish or maintain existing unique research 
resources or an affiliation with an entity that has unique research 
resources and what those unique resources are.

C. Proposed Plan Criteria

1. Targeted Population
    For targeting multiple Indian tribes, we are proposing that 
qualifying hospitals refer to the notice on ``Indian Entities 
Recognized and Eligible to Receive Services from the United States 
Bureau of Indian Affairs.'' The most recent notice was published in the 
Federal Register on December 5, 2003 (68 FR 68180). Qualifying 
hospitals would use this list when designating the target population 
for outreach programs servicing multiple Indian tribes since these are 
the Indian tribes that have unique legal status under Federal law.
    For other target populations, we are not proposing how the 
qualifying hospital should determine or designate the population as 
long as it encompasses a substantial majority of the residents of a 
State or region, including residents of rural areas that it services. 
We believe that the qualifying hospital is in the best position to 
designate the targeted populations for their outreach programs to the 
substantial majority of residents and to rural areas. We believe that 
allowing the qualifying hospital to designate its populations provides 
flexibility over the life of the loan deferment period as its 
populations change due to results from its outreach programs, treatment 
services, or other reasons. However, we are proposing that the 
qualifying hospital provide sufficient detail in its initial plan to 
clearly describe how it designated its targeted populations and that 
the populations designated should be in accordance with the provisions 
of the statute. The qualifying hospital should include in the plan such 
details as demographic information for the targeted population 
generally and some initial estimates of relevant rates of diagnosis of 
and death from cancers prevalent in its population(s).
2. Identification of the Cancer Types
    In this proposed rule, we are not proposing specific cancers (or 
the number of cancer types) that the qualifying hospital must focus on 
in its outreach programs. Again, we believe that the qualifying 
hospital is in the best position to determine the types of cancer to 
target in its outreach programs and that allowing the qualifying 
hospital to determine the cancer types provides flexibility over the 
life of the loan deferment period as the population changes or cancer 
prevention and treatment services improve. However, we are proposing 
that the qualifying hospital provides sufficient detail in its initial 
plan to clearly describe how it would identify the cancer types that it 
is targeting. The reasons for selecting specific cancers may include 
such things as high prevalence or incidence, high mortality or 
morbidity, easily treatable, available screening techniques, and easily 
diagnosed. The four most common cancers--prostate, breast, lung, and 
colon/rectum--accounted for more than half of all new cases of cancer 
in 1998 and qualifying hospitals may wish to target these cancers in 
their outreach programs. [National Cancer Policy Board (IOM). Ensuring 
Quality Cancer Care.

[[Page 57379]]

Washington DC: National Academy Press, 1999]
3. Intervention Approaches
    In this propose rule, we are not mandating specific intervention 
approaches that the qualifying hospital must conduct in its outreach 
programs. We believe that the qualifying hospital is in the best 
position to determine the types of interventions to implement based on 
its target population and the types of cancers included in its outreach 
programs. We believe that allowing the qualifying hospital to determine 
its specific interventions provides flexibility to the qualifying 
hospital to try different approaches over the life of the loan 
deferment period. However, we are proposing that the qualifying 
hospital provide sufficient detail in its initial plan and subsequent 
progress reports to clearly describe the approaches it will be 
conducting or implementing, including the reasons why the intervention 
approaches were selected and why they may make a difference in 
improving cancer care for the targeted population.
4. Goals for Improvement
    We are proposing in Sec.  505.15 that the qualifying hospital 
include in its plan, improvement goals for the prevention, early 
diagnosis, and treatment, for each cancer type identified in its 
outreach programs. The qualifying hospital must work towards these 
goals during the loan deferment period. We believe that it is important 
to establish goals for improving performance over the loan deferment 
period as one way to document the potential impact of its outreach 
programs on improvement in the care provided to the targeted 
populations. This would help the qualifying hospital determine if its 
outreach programs are getting the desired results.
    As previously indicated, we are not proposing specific goals for 
the qualifying hospital to achieve. However, we are proposing that the 
qualifying hospital must determine its own improvement goals for each 
cancer type (that is for the prevention, early diagnosis, and 
treatment). We believe that it is important for the qualifying hospital 
to determine its own goals because it is in the best position to know 
or understand the various factors or barriers in its population 
(community) that may influence the achievement of the goals and work 
towards overcoming them. For example, if the qualifying hospital 
selects breast cancer as one of the cancer types it would focus on for 
the designated population, the qualifying hospital may select a goal of 
decreasing the number of new initial breast cancer diagnosis or cases 
by 10 percent from the previous year (a prevention goal), or select a 
goal of increasing the number of mammograms performed by 10 percent 
from the previous year (an early diagnosis goal), or select a goal of 
increasing the number of patients who receive their first treatment 
after initial diagnosis within the time period specified by the 
appropriate clinical practice guidelines (a treatment goal). We 
understand that there are many factors to take into account when 
selecting goals, but we believe that it is important for the qualifying 
hospital to work towards established goals so that it can determine if 
its outreach programs are having the desired effect and changes to its 
outreach approaches can be made as needed.
5. Measures
    We are proposing in Sec.  505.17 that the qualifying hospital 
include in its initial plan at least one measure (for example, either 
an outcome measure or a process measure) used to track its progress in 
achieving the goals it has established for each area of prevention, 
early diagnosis, and treatment, for each cancer type identified in its 
plan. We are not proposing the specific measures that the qualifying 
hospital should track because we believe that the qualifying hospital 
is in the best position to determine the appropriate measures. 
Furthermore, we believe that it provides flexibility and allows the 
goals to be revised because of various factors or barriers (for 
example, community) that may influence the achievement of the goal to 
have changed. For example, if the qualifying hospital identifies lung 
cancer as one of the cancer types it would focus on for the designated 
population, the qualifying hospital may select the percent of patients 
enrolled in smoking cessation sessions and who quit smoking for 1 year 
or more as a measure to track its prevention goal. The qualifying 
hospital may select the percent of patients at high risk for developing 
lung cancer who receive a screening test as a measure to track its 
early diagnosis goal, and it may select the percent of patients who 
were initially diagnosed with lung cancer and received the appropriate 
treatment timely to track its treatment goal. The goal that is selected 
should drive what measure is selected for tracking the goal, such as 
goals for early diagnosis and treatment.
6. Unique Research Resources
    We are proposing in Sec.  505.15(b) that the qualifying hospital 
include in its plan a description of how it would establish or maintain 
existing unique research resources or how it would establish or 
maintain an existing affiliation with another entity that has unique 
research resources. Examples of unique research resources are a 
population database, a cancer biomedical informatics system, a 
surveillance system for observing or measuring cancer incidence, 
morbidity, survival, and/or mortality, an epidemiology study, an end 
results database, or a tumor registry. We are soliciting comments on 
other unique research resources that may be available.

D. Reporting Requirements for Meeting the Conditions for Loan 
Forgiveness (Proposed Sec.  505.17)

[If you choose to comment on issues in this section, please include the 
caption ``Reporting Requirements'' at the beginning of your comments.]
    We are proposing that the qualifying hospital must submit annual 
progress reports to CMS describing its progress in achieving its plan 
or any changes to the initial plan. We would review the annual progress 
reports and provide feedback to the qualifying hospital, so that it is 
aware of its loan forgiveness status during the loan deferment period.
    Annual progress reports from the qualifying hospital would allow us 
to monitor the qualifying hospitals performance in meeting the 
conditions for loan forgiveness during the loan deferment period. We 
intend to monitor the qualifying hospitals' performance during the 
entire loan deferment period to ensure that these qualifying hospitals 
meet the conditions for loan forgiveness. We would require qualifying 
hospitals to submit the final progress report to us 6 months before the 
end of the loan deferment period. At that time, we would determine 
whether the qualifying hospital has met the loan forgiveness 
conditions. We are proposing this timeframe since determinations of 
loan forgiveness must be made at the end of 5 years.

E. Approval or Denial of Loan Forgiveness (Proposed Sec.  505.19)

[If you choose to comment on issues in this section, please include the 
caption ``Approval or Denial of loan forgiveness'' at the beginning of 
your comments.]

    We are proposing that if a qualifying hospital meets the 
conditions, plan criteria, and reporting requirements for loan 
forgiveness specified in Sec.  505.13, Sec.  505.15, and Sec.  505.17, 
the loan would be forgiven. Therefore, we would send

[[Page 57380]]

written notification for the loan forgiveness approval to the loan 
recipient 90 days before the end of the loan deferment period. We are 
proposing that if the loan recipient does not meet the conditions, plan 
criteria, or reporting requirements for the loan forgiveness specified 
in Sec.  505.13, Sec.  505.15, and Sec.  505.17, we would send written 
notification for the denial of the loan forgiveness.

III. Collection of Information Requirements

    The collection of information requirements at 5 CFR part 1320 are 
applicable to requirements affecting 10 or more entities. While this 
proposed rule contains information collection requirements, because we 
believe that these requirements would affect less than 10 entities, we 
believe that these collection requirements are exempt from OMB for 
review and approval, as specified at 5 CFR 1320.3(c)(4). Consequently, 
this proposed rule need not be reviewed by the Office of Management and 
Budget under the authority of the Paperwork Reduction Act of 1995.

IV. Response to Comments

    Because of the large number of items of correspondence we normally 
receive on Federal Register documents, we are not able to acknowledge 
or respond to them individually. We will consider all comments we 
receive by the date and time specified in the DATES section of this 
preamble. Thus, when we proceed with a subsequent document, we will 
respond to the comments in the preamble to that document.

V. Regulatory Impact

A. Overall Impact

    We have examined the impacts of this proposed rule as required by 
Executive Order 12866 (September 1993, Regulatory Planning and Review), 
the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-
354), section 1102(b) of the Social Security Act, the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4) and Executive Order 13132.
    Executive Order 12866 (as amended by Executive Order 13258, which 
merely reassigns responsibility of duties) directs agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
regulatory impact analysis (RIA) must be prepared for major rules with 
economically significant effects ($100 million or more in any 1 year). 
This proposed rule is not a major rule because it does not have an 
effect of more than $100 million in any 1 year.
    The RFA requires agencies to analyze options for regulatory relief 
of small businesses. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and small governmental 
jurisdictions. Most hospitals and most other providers and suppliers 
are small entities, either by nonprofit status or by having revenues of 
$6 million to $29 million in any 1 year. For purposes of the RFA, all 
hospitals are considered small businesses according to the Small 
Business Administration's latest size standards with total revenues of 
$26 million or less in any 1 year (for further information, see the 
Small Business Administration's regulation at 65 FR 69432, November 17, 
2000). Individuals and States are not included in the definition of a 
small entity. This proposed rule affects qualifying hospitals as 
defined by section 1897 of the Act that have been selected to receive 
funds under the loan program. We believe a total of 61 facilities meet 
the definition of qualifying hospitals under section 1897 of the Act 
(that is, 60 NCI cancer centers and 1 State legislature designated 
cancer institute, but only a few hospitals would actually be selected 
to receive funds under the loan program and be eligible for loan 
forgiveness).
    In addition, section 1102(b) of the Act requires CMS to prepare a 
regulatory impact analysis if a rule may have a significant impact on 
the operations of a substantial number of small rural hospitals. This 
analysis must conform to the provisions of section 603 of the RFA. For 
purposes of section 1102(b) of the Act, we define a small rural 
hospital as a hospital that is located outside of a Metropolitan 
Statistical Area and has fewer than 100 beds. None of the eligible 
facilities are small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule who mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. That threshold 
level is currently approximately $120 million. This proposed rule does 
not mandate any requirements for State, local, or tribal governments, 
nor would it result in expenditures by the private sector of $120 
million in any 1 year.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on State 
and local governments, preempts State law, or otherwise has Federalism 
implications. Section 1897 of the Act directly specifies that no 
provisions under the Program implemented by this proposed rule would 
relieve an obligation of State and local permits or limit or otherwise 
supersede any State or local law.

B. Anticipated Effects

1. Effects on Hospitals
    The provisions of this proposed rule are limited to qualifying 
hospitals that have received funds under the loan program and are 
eligible for loan forgiveness. Only 61 facilities would meet the 
definition of qualified hospitals as required by section 1897 of the 
Act. Since the capital costs of projects which the loan program is 
designed to pay for are likely to be substantial and expensive, we 
expect only a small percentage of the 61 eligible facilities would 
actually be granted loans under this provision before the funds are 
exhausted and therefore be eligible for loan forgiveness. For the few 
qualifying hospitals that would receive funds under the loan program, 
we expect they would use the money on projects that are ``designed to 
improve the healthcare infrastructure of the hospital including 
construction, renovation, or other capital improvements'' and which 
would result in better facilities in which to provide cancer care to 
our beneficiaries. To qualify for loan forgiveness, the qualifying 
hospitals must meet the conditions specified in section 1897(f) of the 
Act, which we believe would positively impact the cancer care our 
beneficiaries receive. As well, the qualifying hospitals would realize 
a benefit when their loans are forgiven. However, we believe that the 
effect would be limited to those few qualifying hospitals that have 
received loan funds and are eligible for loan forgiveness. Thus, the 
provisions in this proposed rule would not have a significant economic 
impact on a substantial number of hospitals.
2. Effects on the Medicare and Medicaid Programs
    The $142 million in available loan funds is appropriated for the 
loan program and not more than $2,000,000 may be used for the 
administration costs of the loan program.

[[Page 57381]]

C. Alternatives Considered

    We considered no alternatives to the policies in this proposed rule 
since the statute authorizes the conditions under which the Secretary 
may forgive a loan provided under the Health Care Infrastructure 
Improvement Program.

D. Conclusion

    For these reasons, we are not preparing further analyses for either 
the RFA or section 1102(b) of the Act because we have determined that 
this rule would not have a significant economic impact on a substantial 
number of small entities or a significant impact on the operations of a 
substantial number of small rural hospitals.
    In accordance with the provisions of Executive Order 12866, this 
regulation was reviewed by the Office of Management and Budget.

List of Subjects in 42 CFR Part 505

    Administrative practice and procedure, Health facilities, Loan 
programs, Infrastructure improvement program, Reporting and 
recordkeeping, and Rural areas.

    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services is proposing to amend 42 CFR chapter IV as follows:

SUBCHAPTER H--HEALTH CARE INFRASTRUCTURE IMPROVEMENT PROGRAM

PART 505--THE ESTABLISHMENT OF THE HEALTH CARE INFRASTRUCTURE 
IMPROVEMENT PROGRAM

    1. The authority citation for part 505 continues to read as 
follows:


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

    2. In 505.3 is amended by republishing the introductory text and 
adding the following definitions in alphabetical order to read as 
follows:


Sec.  505.3  Definitions

    For purposes of this subpart, the following definitions apply:
* * * * *
    Outreach programs mean formal cancer programs for teaching, 
diagnostic screening, therapy or treatment, prevention, or 
interventions to enhance the health and knowledge of their designated 
population(s).
* * * * *
    Unique research resources means resources that are used for the 
purpose of discovering or testing options related to the causes, 
prevention, and treatment of cancer.
    3. A new Subpart B is added to read as follows:
Subpart B--Forgiveness of Indebtedness
Secs.
505.13 Conditions for loan forgiveness.
505.15 Plan criteria for meeting the conditions for loan 
forgiveness.
505.17 Reporting requirements for meeting the conditions for loan 
forgiveness.
505.19 Approval or denial of loan forgiveness.

Subpart B--Forgiveness of Indebtedness


Sec.  505.13  Conditions for loan forgiveness.

    The Secretary may forgive a loan provided under this part if the 
qualifying hospital meets the following conditions:
    (a) Must be selected to participate in the loan program specified 
in Sec.  505.5(c) of this part.
    (b) Has established the following:
    (1) An outreach program for cancer prevention, early diagnosis, and 
treatment that provides services to a substantial majority of the 
residents of a State or region, including residents of rural areas;
    (2) An outreach program for cancer prevention, early diagnosis, and 
treatment that provides services to multiple Indian tribes; and
    (3) Unique research resources (such as population databases) or an 
affiliation with an entity that has unique research resources.
    (c) Submits to CMS within the timeframe specified by the Secretary 
a--
    (1) Written request for loan forgiveness; and
    (2) Loan forgiveness plan that meets the criteria specified in 
Sec.  505.15 of this subpart.


Sec.  505.15  Plan criteria for meeting the conditions for loan 
forgiveness.

    The qualifying hospital requesting loan forgiveness must submit to 
CMS a plan specifying how it will develop, implement, or maintain an 
existing outreach program for cancer prevention, early diagnosis, and 
treatment for a substantial majority of the residents of a State or 
region, including residents of rural areas and for multiple Indian 
Tribes and specifying how the qualifying hospital will establish or 
maintain existing unique research resources or an affiliation with an 
entity that has unique research resources.
    (a) Outreach programs. The initial plan must specify how the 
hospital will establish or develop, implement, or maintain existing 
outreach programs. The plan must--
    (1) Address cancer prevention for cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for decreasing the targeted cancer 
rates during the loan deferment program; and
    (2) Address early diagnosis of cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for improving early diagnosis rates 
for the targeted cancer(s) during the loan deferment period;
    (3) Address cancer treatment for cancers that are prevalent in the 
designated populations or cancers that are targeted by the qualifying 
hospital, interventions, and goals for improving cancer treatment rates 
for the targeted cancer(s) during the loan deferment; and
    (4) Identify the measures that will be used to determine the 
qualifying hospital's annual progress in meeting the initial goals 
specified in paragraphs (a)(1) through (a)(3) of this section.
    (b) Unique research resources. The plan must specify how the 
qualifying hospital will establish or maintain existing unique research 
resources or an affiliation with an entity that has unique research 
resources.


Sec.  505.17  Reporting requirements for meeting the conditions for 
loan forgiveness.

    (a) Annual reporting requirements. On an annual basis, the 
qualifying hospital must submit a report to CMS that updates the plan 
specified in Sec.  505.15 of this subpart by--
    (1) Describing the qualifying hospital's progress in meeting its 
initial plan goals;
    (2) Describing any changes to the qualifying hospital's initial 
plan goals; and
    (3) Including at least one measure used to track the qualifying 
hospital's progress in meeting its plan goals.
    (b) Review of annual reports. CMS will review each qualifying 
hospital's annual report to provide the hospital with feedback 
regarding its loan forgiveness status.
    (c) Final reporting requirements. A qualifying hospital must submit 
its final written report to CMS 6 months before the end of the loan 
deferment period specified in Sec.  505.7(b) of this part.


Sec.  505.19  Approval or denial of loan forgiveness.

    (a) Approval of loan forgiveness. If a qualifying hospital has met 
the conditions, plan criteria, and reporting requirements for loan 
forgiveness specified in Sec.  505.13, Sec.  505.15, and Sec.  505.17 
of this part, CMS will send a written notification of approval for loan

[[Page 57382]]

forgiveness to the qualifying hospital 90 days before the end of the 
loan deferment period defined in Sec.  505.7(b) of this part.
    (b) Denial of loan forgiveness. If a qualifying hospital has not 
met the conditions, plan criteria, or reporting requirements for loan 
forgiveness specified in Sec.  505.13, Sec.  505.15, or Sec.  505.17 of 
this part, CMS will send a written notification of denial for loan 
forgiveness to the qualifying hospital.

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

    Dated: June 28, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
    Approved: August 3, 2005.
Michael O. Leavitt,
Secretary.
[FR Doc. 05-19307 Filed 9-23-05; 4:00 pm]
BILLING CODE 4120-03-P