Black Lung Benefits Act: Medical Benefit Payments, 739-770 [2016-31382]

Download as PDF Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules (b) Affected ADs This AD replaces AD 2009–17–01, Amendment 39 15991 (74 FR 40061, August 11, 2009) (‘‘AD 2009–17–01’’). (c) Applicability This AD applies to the Gulfstream Aerospace Corporation airplanes, certificated in any category, identified in paragraphs (c)(1) through (c)(5) of this AD. (1) Model G–IV airplanes, having serial numbers (S/Ns) 1000 and subsequent. (2) Model GIV–X airplanes, having S/Ns 4001 and subsequent. (3) Model GV airplanes, having S/Ns 501 and subsequent. (4) Model GV–SP airplanes, having S/Ns 5001 and subsequent. (5) Model GVI airplanes, having S/Ns 6001 and subsequent. (d) Subject Air Transport Association (ATA) of America Code 49, Airborne Auxiliary Power; and 53, Fuselage. (e) Unsafe Condition This AD was prompted by a report indicating that the type design sealant is flammable and failed a certification test and a company test. We are issuing this AD to provide the flight crew with operating procedures for airplanes that have flammable sealant compound applied to the auxiliary power unit (APU) enclosure (firewall). Under certain anomalous conditions such as an APU failure/APU compartment fire, flammable sealant could ignite the exterior surfaces of the APU enclosure and result in propagation of an uncontained fire to other critical areas of the airplane. mstockstill on DSK3G9T082PROD with PROPOSALS (f) Compliance Comply with this AD within the compliance times specified, unless already done. (g) Airplane Flight Manual (AFM) Revision Within 30 days after the effective date of this AD, revise the Limitations Section of the applicable Gulfstream AFM specified in paragraphs (h)(1) through (h)(6) of this AD to include the information in the applicable Gulfstream AFM supplement (AFMS) specified in paragraphs (h)(1) through (h)(6) of this AD. These AFM supplements (AFMSs) introduce operating limitations on the use of the APU during certain ground and flight operations. Note 1 to paragraph (g) of this AD: This AFM revision may be done by inserting a copy of the applicable AFMS into the applicable AFM specified in paragraphs (h)(1) through (h)(6) of this AD. When the AFMS has been included in the general revision of the AFM, the general revision may be inserted into the AFM, provided the relevant information in the general revision is identical to that in the applicable AFMS specified in paragraphs (h)(1) through (h)(6) of this AD. (h) AFMSs For the AFM revision required by paragraph (g) of this AD, insert the applicable AFMS into the applicable Gulfstream AFM VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 identified in paragraphs (h)(1) through (h)(6) of this AD. (1) Gulfstream GIV/G300/G400 AFM Supplement GIV–2016–01, dated July 27, 2016, to the GIV AFM, dated April 22, 1987; the G300 AFM, dated January 15, 2003; and the G400 AFM, dated November 18, 2002. (2) Gulfstream G450/G350 AFM Supplement G450–2016–01, dated July 27, 2016, to the G450 AFM, dated August 12, 2004; and the G350 AFM, dated October 28, 2004. (3) Gulfstream GV AFM Supplement GV– 2016–01, dated July 27, 2016, to the GV AFM, dated April 11, 1997. (4) Gulfstream G550/G500 AFM Supplement G550–2016–01, dated July 27, 2016, to the G550 AFM, dated August 14, 2003; and the G500 AFM, dated December 5, 2003. (5) Gulfstream GVI (G650) AFM Supplement G650–2016–01, dated July 27, 2016, to the GVI (G650) AFM dated, September 7, 2012. (6) Gulfstream GVI (G650ER) AFM Supplement G650ER–2016–03, dated July 27, 2016, to the GVI (G650ER) AFM, dated October 2, 2014. (i) Credit for Previous Actions This paragraph provides credit for the action required by paragraph (g) of this AD, if that action was performed before the effective date of this AD using the applicable service information specified in paragraphs (i)(1) through (i)(4) of this AD. This service information was incorporated by reference in AD 2009–17–01. (1) Gulfstream G–IV/G300/G400 AFM Supplement G–IV–2009–02, Revision 1, dated June 25, 2009. (2) Gulfstream G450/G350 AFM Supplement G450–2009–03, Revision 1, dated June 25, 2009. (3) Gulfstream GV AFM Supplement GV– 2009–03, Revision 1, dated June 25, 2009. (4) Gulfstream G550/G500 AFM Supplement G550–2009–03, Revision 1, dated June 25, 2009. (j) Alternative Methods of Compliance (AMOCs) (1) The Manager, Atlanta Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (k)(1) of this AD. (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/ certificate holding district office. (3) AMOCs approved previously for paragraph (h) of AD 2009–17–01 are approved as AMOCs for the corresponding provisions of paragraph (g) of this AD. (k) Related Information (1) For more information about this AD, contact Ky Phan, Aerospace Engineer, Propulsion and Services Branch, ACE–118A, PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 739 FAA, Atlanta ACO 1701 Columbia Avenue, College Park, GA 30337; phone: 404–474– 5536; fax: 404–474–5606; email: ky.phan@ faa.gov. (2) For service information identified in this AD, contact Gulfstream Aerospace Corporation, Technical Publications Dept., P.O. Box 2206, Savannah, GA 31402–2206; telephone 800–810–4853; fax 912–965–3520; email pubs@gulfstream.com; Internet http:// www.gulfstream.com/product_support/ technical_pubs/pubs/index.htm. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425–227–1221. Issued in Renton, Washington, on December 16, 2016. Ross Landes, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service. [FR Doc. 2016–31362 Filed 1–3–17; 8:45 am] BILLING CODE 4910–13–P DEPARTMENT OF LABOR Office of Workers’ Compensation Programs 20 CFR Part 725 RIN 1240–AA11 Black Lung Benefits Act: Medical Benefit Payments Office of Workers’ Compensation Programs, Labor. ACTION: Notice of proposed rulemaking; request for comments. AGENCY: The Department is proposing revisions to regulations under the Black Lung Benefits Act (BLBA or Act) governing the payment of medical benefits. The Department is basing these rules on payment formulas that the Centers for Medicare & Medicaid Services (CMS) uses to determine payments under the Medicare program. The Department also intends to make the rules similar to those utilized in the other programs that the Office of Workers’ Compensation Programs (OWCP) administers. These rules will determine the amounts payable for covered medical services and treatments provided to entitled miners, when those services or treatments are paid by the Black Lung Disability Trust Fund. In addition, the proposed rule would eliminate two obsolete provisions. DATES: The Department invites written comments on the proposed regulations from interested parties. Written comments must be received by March 6, 2017. ADDRESSES: You may submit written comments, identified by RIN number SUMMARY: E:\FR\FM\04JAP1.SGM 04JAP1 740 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules to medical benefits. 33 U.S.C. 907, as incorporated by 30 U.S.C. 932(a); 20 CFR 725.701. The current rules governing the payment of medical benefits are contained in 20 CFR part 725, subpart J. Under these rules, a miner is entitled to ‘‘such medical, surgical, and other attendance and treatment, nursing and hospital services, medicine and apparatus, and any other medical service or supply, for such periods as the nature of miner’s pneumoconiosis and disability requires.’’ 20 CFR 725.701(b). In most cases, a responsible operator is liable for the payment of medical benefits. But OWCP pays medical benefits from the Trust Fund in three instances: (1) If no responsible operator can be identified as the party liable for a claim, and the Trust Fund is liable as a result (id.); (2) when the identified responsible operator declines to pay benefits pending final adjudication of a claim (see 20 CFR 725.522, 725.708(b)); and (3) when the responsible operator fails to meet its payment obligations on a final award (see 20 CFR 725.502). For interim payments made pending final adjudication, OWCP seeks reimbursement from the operator after the claim is finally awarded. 20 CFR 725.602(a). Likewise, OWCP seeks reimbursement for payments made when an operator fails to meet its obligations on a final award. 20 CFR 725.601. Current § 725.706(c) provides that payment for medical benefits ‘‘shall be FOR FURTHER INFORMATION CONTACT: made at no more than the rate prevailing Michael Chance, Director, Division of in the community in which the Coal Mine Workers’ Compensation, providing physician, medical facility or Office of Workers’ Compensation supplier is located.’’ 20 CFR 725.706(c). Programs, U.S. Department of Labor, The current regulations, however, do Suite C–3520, 200 Constitution Avenue not address how the prevailing NW., Washington, DC 20210. community rate for a particular medical Telephone: 1–800–347–2502. This is a service or treatment is determined. For toll-free number. TTY/TDD callers may medical benefits paid by the Trust dial toll-free 1–877–889–5627 for Fund, the Division of Coal Mine further information. Workers’ Compensation (DCMWC) currently bases payment for professional SUPPLEMENTARY INFORMATION: medical services, medical equipment, I. Background of This Rulemaking and inpatient and outpatient medical The BLBA, 30 U.S.C. 901–944, services and treatments, on internallyprovides for the payment of benefits to derived payment formulas. DCMWC coal miners and certain of their currently pays for prescription dependent survivors on account of total medications utilizing a payment disability or death due to coal workers’ formula similar to that employed by the pneumoconiosis. 30 U.S.C. 901(a); Usery three other workers’ compensation v. Turner Elkhorn Min. Co., 428 U.S. 1, programs that OWCP administers. The Department now proposes to 5 (1976). Benefits are paid by either an revise Subpart J. Specifically, the individual coal mine operator that Department proposes to base Trust Fund employed the coal miner (or its payments for all medical services and insurance carrier), or the Black Lung treatments rendered on or after the Disability Trust Fund. Director, OWCP effective date of this rule on payment v. Bivens, 757 F.2d 781, 783 (6th Cir. formulas derived from those used by 1985). CMS under the Medicare program. The A miner who is entitled to disability benefits under the BLBA is also entitled proposed payment formulas are similar mstockstill on DSK3G9T082PROD with PROPOSALS 1240–AA11, by any of the following methods. To facilitate receipt and processing of comments, OWCP encourages interested parties to submit their comments electronically. • Federal eRulemaking Portal: http:// www.regulations.gov. Follow the instructions on the Web site for submitting comments. • Facsimile: (202) 693–1395 (this is not a toll-free number). Only comments of ten or fewer pages, including a FAX cover sheet and attachments, if any, will be accepted by FAX. • Regular Mail or Hand Delivery/ Courier: Submit comments on paper to the Division of Coal Mine Workers’ Compensation, Office of Workers’ Compensation Programs, U.S. Department of Labor, Suite C–3520, 200 Constitution Avenue NW., Washington, DC 20210. The Department’s receipt of U.S. mail may be significantly delayed due to security procedures. You must take this into consideration when preparing to meet the deadline for submitting comments. Instructions: All submissions received must include the agency name and the Regulatory Information Number (RIN) for this rulemaking. All comments received will be posted without change to http://www.regulations.gov, including any personal information provided. Docket: For access to the docket to read background documents or comments received, go to http:// www.regulations.gov. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 to those used by the other OWCP programs, but are tailored to the specific geography, medical conditions, and needs of black lung program stakeholders. See proposed § 725.707. The proposal also gives OWCP the flexibility to depart from the payment formulas if they cannot be used to determine the prevailing community rate, and requires OWCP to review (and, if necessary, update, revise or replace) the payment formulas at least annually. See proposed § 725.707(e). This flexibility will allow OWCP to timely address any issues that may result from the implementation and application of the payment formulas, including any impact on miners’ access to health care. The Department believes that the proposed payment formulas more accurately reflect prevailing community rates for authorized treatments and services than do the internally-derived formulas that OWCP currently uses for the black lung program. Moreover, because the Department believes that responsible operators and their insurance carriers utilize payment formulas or fee schedules that are substantially similar to the proposed payment formulas, the Trust Fund is more likely to be fully reimbursed for the payments it makes on an interim basis. Thus, this change will serve to control the health care costs associated with the BLBA, conserve the Trust Fund’s limited resources, and provide greater clarity and certainty with respect both to fees paid to providers and reimbursements sought from operators and carriers. Likewise, it will ensure more consistent payment policies across all of the compensation programs administered by OWCP. The Department invites comments on the proposed rule from all interested parties. The Department is particularly interested in comments addressing the impact of the proposed payment formulas on health care services providers and any resulting impact on miners’ access to health care. II. Summary of the Proposed Rule A. General Provisions The Department is proposing several general revisions to advance the goals set forth in Executive Order 13563 (2012). That Order states that regulations must be ‘‘accessible, consistent, written in plain language, and easy to understand.’’ 76 FR 3821. See also E.O. 12866, 58 FR 51735 (Sept. 30, 1993) (agencies must draft ‘‘regulations to be simple and easy to understand, with the goal of minimizing the potential for uncertainty and litigation arising from such E:\FR\FM\04JAP1.SGM 04JAP1 mstockstill on DSK3G9T082PROD with PROPOSALS Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules uncertainty’’). Accordingly, the Department proposes numerous technical and stylistic changes to Subpart J to improve clarity, consistency, and readability. The Department proposes to remove the imprecise term ‘‘shall’’ throughout the sections that it is amending or republishing, and to substitute ‘‘must,’’ ‘‘must not,’’ ‘‘will,’’ or other situationappropriate terms. No alteration in meaning either results from or is intended by these changes, which are made in the following proposed regulations: § 725.701, § 725.703, § 725.704, § 725.705, § 725.706, § 725.718, and § 725.720. Consistent with the goal of making this regulation easier to understand, the Department proposes several additional technical changes. First, the Department proposes to replace references to ‘‘the Office’’ with ‘‘OWCP’’ because that acronym is more commonly used by stakeholders. As explained in current § 725.101(a)(21), ‘‘Office’’ and ‘‘OWCP’’ both mean ‘‘the Office of Workers’ Compensation Programs, United States Department of Labor.’’ Thus, no alteration in meaning either results from or is intended by this change, which is made in the following regulations: § 725.703, § 725.704, § 725.705, and § 725.706. Second, where appropriate, the Department proposes to replace references to a coal-mine ‘‘operator’’ with ‘‘operator or carrier’’ because § 725.360(a)(4) makes any coal-mine operator’s insurance carrier a party to the operator’s claims. Because either an operator or a carrier may defend or pay claims for medical benefits, no alteration in meaning either results from or is intended by this change, which is made in the following regulations: § 725.704, § 725.706, and § 725.718. Additionally, the Department proposes to replace a reference to ‘‘insurer’’ with the word ‘‘carrier’’ because, under § 725.101(a)(18), both mean an entity ‘‘authorized under the laws of a State to insure employers’ liability under workers’ compensation laws.’’ Thus, no alteration in meaning either results from or is intended by this change, which appears in § 725.704. Third, where appropriate, for purposes of consistency with the rest of the Subpart, the Department proposes to substitute the broader term ‘‘provider’’ for the term ‘‘physician’’ and/or ‘‘facility’’ as well as to substitute the term ‘‘medical equipment’’ for the term ‘‘apparatus.’’ No alteration in meaning either results from or is intended by these changes, which are made in the following regulations: § 725.701, § 725.704, § 725.705, and § 725.706. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 Finally, to make the regulations clearer and more user-friendly, the Department proposes new titles, phrased in question form, for all of the regulations appearing in Subpart J. Executive Order 13563 also instructs agencies to review ‘‘rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them.’’ The Department proposes to cease publication of two obsolete rules (20 CFR 725.308(b) and 725.702). Because of the deletion of current § 725.702 and the addition of new rules adopting the payment formulas noted above, other current regulations (20 CFR 725.703– 725.708 and 725.710–725.711) will be renumbered. All technical and stylistic changes designated here are not included in the section-by-section explanation. All proposed substantive revisions to existing rules and all proposed new rules are discussed below. B. Section-by-Section Explanation § 725.308 Claims Time Limits for Filing The Department proposes to discontinue publication of § 725.308(b) because it is obsolete. Current § 725.308(b) establishes a time limit applicable to miners’ claims for medical benefits filed under Section 11 of the Black Lung Benefits Reform Act, 30 U.S.C. 924a, repealed, Public Law 107– 275, 2(c)(2), 116 Stat. 1926 (2002). For the reasons explained in the discussion under 20 CFR subpart J below, continued publication of regulations related to Section 11 is unnecessary. To implement this change, the Department also proposes conforming technical amendments to current § 725.308(c), including renumbering current paragraph (c) as paragraph (b). Subpart J—Medical Benefits and Vocational Rehabilitation The Department proposes multiple revisions and additions to the provisions governing medical benefits in Subpart J. Because the proposed changes are substantial, the Department has republished Subpart J in its entirety below. In the existing regulations and in compliance with Executive Order 13563, the Department proposes to discontinue publication of § 725.702 because it is obsolete. 20 CFR 725.702. Section 725.702 implements Section 11 of the Black Lung Benefits Reform Act passed in 1977. 30 U.S.C. 924a, repealed, Public Law 107–275, 2(c)(2), 116 Stat. 1926 (2002). Section 11 required the Secretary of Health, PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 741 Education and Welfare to notify miners receiving benefits under Part B of the Act that they could file a claim for medical benefits under Part C of the Act. Current §§ 725.308 and 725.702 required miners to file these claims on or before December 31, 1980, unless the period was extended for good cause shown. Few, if any, Section 11 claims for medical benefits only remain in litigation. In fact, Congress repealed Section 11 as obsolete in 2002. Thus, continued publication of this regulation is unnecessary. If any Section 11 claim results in litigation after the effective date of these regulations, the claim will continue to be governed by the criteria in the 2015 edition of the Code of Federal Regulations. As a consequence of the deletion of current § 725.702, and the addition of new provisions regarding payments for medical services and treatments, other current regulations (20 CFR 725.703–725.708, 725.710–725.711) will be renumbered. The Department also proposes a new set of regulations that adopt payment formulas and related procedures for determining the prevailing community rate for medical benefits paid by the Trust Fund. The subheadings and other regulatory references in this discussion generally refer to the location of the proposed rule if promulgated as a final rule. Specifically, the Department proposes to replace current § 725.706(c) with proposed §§ 725.707–725.717, which adopt payment formulas and procedures to determine the rates at which various medical services and treatments will be paid by the Trust Fund, as well as the rates at which OWCP will seek reimbursement from operators for medical benefits paid on an interim basis. Similar payment formulas are used by the other three workers’ compensation programs that OWCP administers. Such payment formulas were first developed and adopted for use in claims under the Federal Employees’ Compensation Act, 5 U.S.C. 8101 et seq., in 1986. See 51 FR 8276– 82 (Mar. 10, 1986). Subsequently, similar formulas were adopted for claims under the Longshore Act in 1995 and for claims under the Energy Employees Occupational Illness Compensation Program Act, 42 U.S.C. 7384 et seq., in 2001. See 60 FR 51347– 48 (Oct. 2, 1995); 66 FR 28957–59, 79– 80 (May 25, 2001). The payment formulas the Department proposes to adopt for claims under the BLBA (and those it already utilizes under the other OWCP programs) are derived from the payment formulas that CMS uses to determine payments for medical services and E:\FR\FM\04JAP1.SGM 04JAP1 742 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules treatments under the Medicare program. The proposed formulas encompass locality-based payment rates for physician services and medical equipment (see proposed § 725.708), as well as for outpatient and inpatient medical services (see proposed §§ 725.710 and 725.711, respectively). The Department also proposes, consistent with existing practice and similar to the other OWCP programs, to adopt a single national formula for the payment of prescription-drug costs. See proposed § 725.709. Finally, the Department proposes to adopt specific procedures for providers to enroll with OWCP for authorization to submit medical bills for payment, and for miners to request reimbursement for covered medical expenses and transportation costs. See proposed §§ 725.714–725.717. Most of these provisions simply implement current procedures and, to the extent any differences are proposed, the procedures are consistent with current industry standards. Specific provisions proposed for addition to the regulations in Subpart J are discussed in detail below. mstockstill on DSK3G9T082PROD with PROPOSALS § 725.701 What medical benefits are available? Proposed § 725.701 is a revision of current § 725.701. The Department proposes to combine current paragraphs (e) and (f), and add subdivisions to paragraph (e) for greater clarity and ease of comprehension. Likewise, the Department proposes to delete the confusing reference to ‘‘other employer’’ in paragraph (b). Proposed paragraph (b) also enumerates more clearly the medical services and treatments to which a miner is entitled. The terms ‘‘service’’ and ‘‘treatment’’ are used interchangeably throughout Subpart J to indicate those benefits for which the responsible operator or Trust Fund may be liable. The Department proposes to revise paragraphs (d) and (e)(3) for greater clarity and readability. For the same reason, in paragraph (e), the Department proposes replacing the word ‘‘supply’’ with ‘‘treatment.’’ Finally, the Department also proposes to replace the reference to ‘‘district director’’ in paragraph (d) with ‘‘OWCP,’’ as communication may be made with either the OWCP national or district offices. § 725.702 Who is considered a physician? Proposed § 725.702 is substantively identical to current § 725.703. For consistency, however, osteopathic physicians (DO) are now identified in the same manner as other doctors of medicine (MD). The reference to VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 ‘‘district director’’ in the final sentence is changed to ‘‘OWCP,’’ as the supervision of care may be provided by either the OWCP national office or district offices, depending upon factors such as the geographic location of the miner or provider, the particular services or treatments required by the miner, and the relative resource levels in the OWCP national and district offices. § 725.703 How is treatment authorized? Proposed § 725.703 is a revision of current § 725.704 and contains only technical changes described in Section II–A above. § 725.704 How are arrangements for medical care made? Proposed § 725.704 is a revision of current § 725.705. References to ‘‘such operator’’ have been changed to ‘‘the operator,’’ ‘‘decisionmaking’’ has been changed to ‘‘decision-making,’’ and ‘‘such designation’’ has been changed to ‘‘this designation.’’ The Department does not intend any substantive alteration to the current provision. § 725.705 Is prior authorization for medical services required? Proposed § 725.705 is a revision of paragraphs (a) and (b) of current § 725.706. The Department proposes to replace the reference to ‘‘Chief, Branch of Medical Analysis and Services, DCMWC’’ with ‘‘Chief, Medical Audit and Operations Section, DCMWC’’ to reflect the correct title of the employee authorized to approve requests for hospitalization or surgery by telephone. Paragraph (c) of current § 725.706 is deleted and replaced by proposed §§ 725.707–725.711 (see below). § 725.706 What reports must a medical provider give to OWCP? Proposed § 725.706 is a revision of current § 725.707. The Department proposes to replace the reference to ‘‘district director’’ in paragraph (b) with ‘‘OWCP,’’ as payment determinations may be made by either the OWCP national or district offices. § 725.707 At what rate will fees for medical services and treatments be paid? Proposed § 725.707 is a new provision that sets out general rules governing the payment of compensable medical bills by the Trust Fund. Paragraph (a) provides that the Trust Fund will pay no more than the prevailing community rate for medical services, treatments, drugs or equipment. Paragraph (b) provides that the prevailing community PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 rate for various types of treatments and services will be determined under the provisions of §§ 725.708–725.711. Paragraph (c), however, precludes the application of §§ 725.708–725.711 to charges for services or treatments furnished by the U.S. Public Health Services or the Departments of the Army, Navy, Air Force or Veterans Affairs. Payment for services or treatments furnished by these providers is made under the provisions of proposed § 725.707(d). Because the Department recognizes that there may be circumstances where the provisions of §§ 725.708–725.711 cannot be used to determine the prevailing community rate, paragraph (d) permits OWCP to determine the prevailing community rate based on other payment formulas or evidence. Paragraph (e) requires OWCP to review the payment formulas in §§ 725.708–725.711 annually, and permits OWCP to adjust, revise or replace any formula (or its components) when needed. This provision allows OWCP to change the payment formulas in §§ 725.707–725.711 (or replace them entirely) if, at any given time, OWCP finds that those formulas cannot be used to determine prevailing community rates, are adversely impacting miners’ access to care, or are otherwise not appropriate. Finally, paragraph (f) makes §§ 725.707–725.711 applicable to all services and treatments provided on or after the rule’s effective date. § 725.708 How are payments for professional medical services and medical equipment determined? Proposed § 725.708 is a new provision to govern payments for compensable professional medical services and medical equipment. Paragraph (a) provides that OWCP will pay for professional medical services based on a fee schedule derived from the CMS Medicare program fee schedule. OWCP’s fee schedule will be used to determine the prevailing rate paid for a given medical service in the community in which the provider is located. To calculate the maximum allowable payment, each professional service is identified by a Healthcare Common Procedure Coding System/Current Procedural Terminology (HCPCS/CPT) code,1 which is assigned a relative value for work, practice expense, and malpractice expense. OWCP proposes to utilize relative values established by CMS for the Medicare program. Where CMS does not have a relative value for 1 CPT codes are established and updated by the American Medical Association. HCPCS codes were developed by CMS to complement the CPT. The use of these codes is standard practice in the coding and processing of medical bills. E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules a service, OWCP may develop and assign one. The relative value is multiplied by a relevant geographic adjustment factor as defined by CMS. The resulting value is then multiplied by a monetary conversion factor (which is defined by OWCP) to determine the prevailing community rate for each coded service. Some professional services are not covered by the fee schedule described in paragraph (a). Thus, paragraph (b) provides that payment for services not covered by the paragraph (a) fee schedule is derived from other fee schedules or pricing formulas utilized by OWCP for professional services. Finally, paragraph (c) provides that payment for medical equipment identified by a HCPCS/CPT code is based on fee schedules or pricing formulas utilized by OWCP for medical equipment. mstockstill on DSK3G9T082PROD with PROPOSALS § 725.709 How are payments for prescription drugs determined? Proposed § 725.709 is a new provision to govern payment for compensable prescription drugs. It merely codifies existing policy and does not change current payment practice. Paragraph (a) provides for payment for prescribed medication at a percentage of the national average wholesale price (or another baseline price designated by OWCP). In addition, the provider of the drug will receive a flat-rate dispensing fee, to be set by OWCP. Paragraph (b) provides that where the pricing formula in paragraph (a) cannot be used, OWCP may make payment based on other pricing formulas. Lastly, paragraph (c) provides that OWCP may require the use of specific providers for certain medications and may require the use of generic versions of medications where available. § 725.710 How are payments for outpatient medical services determined? Proposed § 725.710 is a new provision to govern payment for compensable outpatient medical services. Paragraph (a) provides that, where appropriate, OWCP will utilize the Outpatient Prospective Payment System (OPPS) devised by CMS for the Medicare program. Under OPPS, outpatient services are generally assigned to Ambulatory Payment Classifications based on their clinical and resource cost similarities. Payment rates are based on those classifications, adjusted by other factors, including the hospital wage index for the locality where the service is provided. The OPPS was first implemented by CMS in 2000, and the industry is familiar with this payment system for hospital outpatient services. Where outpatient services cannot be VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 assigned or priced appropriately under the OPPS system, paragraph (b) provides that payment for the services will be based on fee schedules and other pricing formulas utilized by OWCP. Finally, paragraph (c) specifies that services provided at an ambulatory surgery center are not paid for under OPPS. Rather, such services are paid under § 725.707(d). § 725.711 How are payments for inpatient medical services determined? Proposed § 725.711 is a new provision to govern payment for compensable hospital inpatient services. Under paragraph (a), OWCP will pay for inpatient services utilizing a DiagnosisRelated Group (DRG) system derived from the Medicare Severity DRG (MS– DRG) methodology used by Medicare in the Inpatient Prospective Payment System (IPPS). DRG-based pricing is the industry standard for determining the payment rates for inpatient hospital treatment and services. In addition to Medicare, it is used by the Department of Veterans’ Affairs, and TRICARE (formerly known as the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS)), as well as by numerous state workers’ compensation programs and private insurance plans. Paragraph (a) specifies that hospital discharge diagnoses are classified into groups (DRGs) based on the patient’s diagnosis and the procedures furnished. Each DRG is assigned a base payment rate, which is then adjusted for both geographic and provider-specific factors to determine the payment rate for each admission. Under paragraph (b), where a compensable inpatient service cannot be paid under the DRG system, payment for the service will be based on fee schedules or other pricing formulas utilized by OWCP. § 725.712 When and how are fees reduced? Proposed § 725.712(a) is a new provision addressing reductions in requested fees. The Department proposes that, where a provider submits a properly coded bill, OWCP will pay no more than the maximum amount allowable under §§ 725.707–725.711. Where a bill is improperly coded, OWCP will either return it to the provider for correction, or deny it outright. Under proposed paragraph (b), if a bill exceeds the maximum amount allowed under the regulations, OWCP will pay only the allowed amount and advise the provider of any reduction in the requested fee. Finally, consistent with current practice, proposed paragraph (c) provides that disputes over fee payments may be referred to the PO 00000 Frm 00010 Fmt 4702 Sfmt 4702 743 Department’s Office of Administrative Law Judges. See 20 CFR 725.708, to be re-codified at 20 CFR 725.718. § 725.713 If a fee is reduced, may a provider bill the claimant for the balance? Proposed § 725.713 is a new provision addressing reductions in requested fees. It codifies current OWCP policy. The proposed provision provides that if a fee has been reduced in accordance with this subpart, providers may not recover any additional amount from the miner. This provision thus would prohibit the practice of ‘‘balance billing,’’ which occurs when providers receive only a portion of their submitted charges from third-party payers and seek to recover the ‘‘balance’’ from the patient. § 725.714 How do providers enroll with OWCP for authorizations and billing? Proposed § 725.714 is a new provision, but it simply codifies OWCP’s existing practice of requiring all non-pharmacy providers seeking payments from the Trust Fund to enroll in the OWCP bill payment processing system. Paragraph (a) requires nonpharmacy providers to enroll in the system and paragraph (b) specifies the manner of enrollment. Paragraph (c) requires non-pharmacy providers to maintain proof of their eligibility for enrollment in the system. Paragraph (d) requires non-pharmacy providers to notify OWCP of any change in the provider’s enrollment information. Paragraph (e) explains that pharmacy providers are required to obtain a National Council for Prescription Drug Programs number, and that upon obtaining such number, they will be automatically enrolled in OWCP’s pharmacy billing system. Finally, paragraph (f) requires providers to submit bills via a specified billprocessing portal or to the requisite OWCP mailing address and to include any identifying numbers OWCP may require. § 725.715 How do providers submit medical bills? Proposed § 725.715 is a new provision that prescribes the forms and documents providers must submit to be paid for rendering covered medical services or treatments to miners. Paragraph (a) lists the forms that a provider must submit for each type of service or treatment. Paragraph (b) sets out the coding or other information that must be included on the forms for each type of service or treatment. Finally, under paragraph (c), a provider, by submitting a bill or accepting payment, signifies that the E:\FR\FM\04JAP1.SGM 04JAP1 744 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Trust Fund. OWCP may waive the time limitation if the provider or miner demonstrates good cause for the late submission of a payment or reimbursement request. § 725.716 How should a miner prepare and submit requests for reimbursement for covered medical expenses and transportation costs? In some instances, a miner will pay for covered medical services out of his or her own pocket. Proposed § 725.716 is a new provision that reflects existing procedures allowing the miner to be reimbursed for these payments. Proposed paragraph (a) requires the miner to submit the appropriate form along with an itemized bill and proof of payment for the services. Proposed paragraph (b) allows OWCP to waive these requirements if the delay between the time of the service and approval of the miner’s claim makes it difficult to obtain this information. Proposed paragraph (c) provides for reimbursement at the rate allowed under proposed §§ 725.707–725.711. If that reimbursement is less than the full amount the miner paid, proposed paragraph (d) places responsibility on the miner to seek a refund or a credit from the provider. But if those efforts fail, proposed paragraph (e) protects the miner by allowing OWCP to make a reasonable reimbursement based on the facts and circumstances in the particular case. Finally, proposed paragraph (f) specifies the form and documentation that a miner must submit to be reimbursed for travel costs and other incidental expenses related to obtaining covered medical services. mstockstill on DSK3G9T082PROD with PROPOSALS service or treatment was necessary and appropriate and was billed in accordance with standard industry practices. In addition, paragraph (c) requires providers to comply with the regulations in Subpart J with respect to the provision of, and billing for, services and treatments. Proposed § 725.718 is a revision of current § 725.708. The Department proposes to revise paragraph (a) to clarify that the dispute-resolution procedures apply to disputes over the payment or cost of a particular medical service or treatment as well as to the miner’s entitlement to such service or treatment. The current regulation requires that hearing requests on whether a miner is entitled to a service or treatment must be given priority over other hearing requests. The proposed provision does not change this requirement, but adds language to paragraph (b) clarifying that disputes over only the payment or cost of a service or treatment are not prioritized over other hearing requests. In paragraph (a) and (b), the Department also proposes to change the references to ‘‘the district director’’ to ‘‘OWCP,’’ as informal resolution efforts and referrals for hearing may be made by either the OWCP national or district offices. In addition, the Department proposes to replace the reference to ‘‘the Director’’ in the last sentence of paragraph (b) with ‘‘OWCP,’’ and to edit the introductory clause in the first sentence of paragraph (b) for clarity and consistency. Finally, the Department proposes to replace the phrase ‘‘over medical benefits’’ in paragraph (d) with ‘‘under this subpart,’’ for clarity and to avoid redundancy. § 725.717 What are the time limitations for requesting payment or reimbursement for medical services and treatments? Proposed § 725.717 would impose a new time limitation on requests for payment or reimbursement for medical services and treatments. The proposed provision would require providers to request payment no later than one year after the end of the calendar year during which either the service or treatment was rendered or in which the miner received a final award of benefits, whichever is later. Miners seeking reimbursement for covered medical services are also governed by this provision. Time limitations on requests for payment will encourage providers and miners to act promptly and will help prevent delays in the submission of bills and reimbursement requests to the VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 § 725.718 How are disputes concerning medical benefits resolved? § 725.719 What is the objective of vocational rehabilitation? Proposed § 725.719 is a revision of current § 725.710. For conciseness and clarity, the Department proposes to replace the phrase ‘‘for work in or around a coal mine and who is unable to utilize those skills which were employed in the miner’s coal mine employment’’ in the first sentence with ‘‘by pneumoconiosis.’’ See 20 CFR 718.204(b)(1)(ii) (defining total disability as inability to ‘‘engag[e] in gainful employment in the immediate area of his or her residence requiring the skills or abilities comparable to those of any employment in a mine or mines in which he or she previously engaged with some regularity over a substantial period of time’’). No change in the meaning of the current provision is intended. PO 00000 Frm 00011 Fmt 4702 Sfmt 4702 § 725.720 How does a miner request vocational rehabilitation assistance? Proposed § 725.720 is a revision of current § 725.711 and contains only technical changes described in Section II–A above. III. Statutory Authority Section 426(a) of the BLBA, 30 U.S.C. 936(a), authorizes the Secretary of Labor to prescribe rules and regulations necessary for the administration and enforcement of the Act. IV. Information Collection Requirements (Subject to the Paperwork Reduction Act) Imposed Under the Proposed Rule The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq., and its implementing regulations, 5 CFR part 1320, require that the Department consider the impact of paperwork and other information collection burdens imposed on the public. A Federal agency generally cannot conduct or sponsor a collection of information, and the public is generally not required to respond to an information collection, unless it is approved by the Office of Management and Budget (OMB) under the PRA and displays a currently valid OMB Control Number. In addition, notwithstanding any other provisions of law, no person may generally be subject to penalty for failing to comply with a collection of information that does not display a valid Control Number. See 5 CFR 1320.5(a) and 1320.6. Although the proposed medical benefit payment rules in Subpart J contain collections of information within the meaning of the PRA (see proposed §§ 725.715–725.716), these collections are not new. They are currently approved for use in the black lung program and other OWCPadministered compensation programs by OMB under Control Numbers 1240– 0007 (OWCP–915 Claim for Medical Reimbursement); 1240–0019 (OWCP–04 Uniform Billing Form); 1240–0021 (OWCP–1168 Provider Enrollment Form); 1240–0037 (OWCP–957 Medical Travel Refund Request); 1240–0044 (OWCP–1500 Health Insurance Claim Form). The requirements for completion of the forms and the information collected on the forms will not change if this rule is adopted in final. Since no changes are being made to the collections, the overall burdens imposed by the information collections will not change. While the Department has determined that the rule does not affect the general terms of the information collections or their associated burdens, consistent E:\FR\FM\04JAP1.SGM 04JAP1 mstockstill on DSK3G9T082PROD with PROPOSALS Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules with requirements codified at 44 U.S.C. 3506(a)(1)(B), (c)(2)(B) and 3507(a)(1)(D); 5 CFR 1320.11, the Department has submitted a series of Information Collection Requests to OMB for approval under the Paperwork Reduction Act of 1995 (PRA) in order to update the information collection approvals to reflect this rulemaking and provide interested parties a specific opportunity to comment under the PRA. Allowing an opportunity for comment helps to ensure that requested data can be provided in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the impact of collection requirements on respondents can be properly assessed. In addition to having an opportunity to file comments with the Department, the PRA provides that an interested party may file comments on the information collection requirements in a proposed rule directly with OMB, at the Office of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL–OWCP, Office of Management and Budget, Room 10235, 725 17th Street NW., Washington, DC 20503; by Fax: 202–395–5806 (this is not a toll-free number); or by email: OIRA_ submission@omb.eop.gov. Commenters are encouraged, but not required, to send a courtesy copy of any comments to the Department by one of the methods set forth above. OMB will consider all written comments that the agency receives within 30 days of publication of this Notice of Proposed Rulemaking (NPRM) in the Federal Register. In order to help ensure appropriate consideration, comments should mention at least one of the OMB control numbers cited in this preamble. OMB and the Department are particularly interested in comments that: • Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; • Evaluate the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; • Enhance the quality, utility, and clarity of the information to be collected; and • Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 e.g., permitting electronic submission of responses. The information collections in this rule may be summarized as follows. The number of responses and burden estimates listed are not specific to the black lung program; instead, the estimates are cumulative for all OWCPadministered compensation programs that collect this information. 1. Title of Collection: Claim for Medical Reimbursement Form. OMB Control Number: 1240–0007. Total Estimated Number of Responses: 31,824. Total Estimated Annual Time Burden: 5,283 hours. Total Estimated Annual Other Costs Burden: $54,737. 2. Title of Collection: Uniform Billing Form (OWCP–04). OMB Control Number: 1240–0019. Total Estimated Number of Responses: 190,970. Total Estimated Annual Time Burden: 21,811 hours. Total Estimated Annual Other Costs Burden: $0. 3. Title of Collection: Provider Enrollment Form. OMB Control Number: 1240–0021. Total Estimated Number of Responses: 37,257. Total Estimated Annual Time Burden: 4,955 hours. Total Estimated Annual Other Costs Burden: $18,629. 4. Title of Collection: Medical Travel Refund Request. OMB Control Number: 1240–0NEW. Total Estimated Number of Responses: 342,462. Total Estimated Annual Time Burden: 56,849 hours. Total Estimated Annual Other Costs Burden: $171,231. 5. Title of Collection: Health Insurance Claim Form. OMB Control Number: 1240–0044. Total Estimated Number of Responses: 2,646,438. Total Estimated Annual Time Burden: 254,875 hours. Total Estimated Annual Other Costs Burden: $0. V. Executive Orders 12866 and 13563 (Regulatory Planning and Review) Executive Orders 12866 and 13563 direct agencies to assess all the costs and benefits of the available alternatives to regulation and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of PO 00000 Frm 00012 Fmt 4702 Sfmt 4702 745 quantifying both costs and benefits, of reducing costs, harmonizing rules, and promoting flexibility. It also instructs agencies to review ‘‘rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them.’’ The Department has considered the proposed rule with these principles in mind and has determined that the affected community will benefit from this regulation. The discussion below sets out the rule’s anticipated economic impact and discusses non-economic factors favoring adoption of the proposal. The Office of Information and Regulatory Affairs of OMB has determined that the Department’s rule represents a ‘‘significant regulatory action’’ under Section 3(f)(4) of Executive Order 12866 and has reviewed the rule. A. Economic Considerations The proposed rule could have an economic impact on parties to black lung claims and others, including health care services providers that furnish covered medical services to entitled miners. The rule is nevertheless necessary to define the prevailing community rate used to pay for particular medical services and treatments for the affected community. As explained in Section I of this preamble, miners found entitled to monthly disability benefits under the BLBA are also entitled to medical benefits, i.e., those medical services and treatments as the miner’s pneumoconiosis and resulting disability require. The Trust Fund pays for medical benefits both when the Trust Fund is primarily liable for a claim and on behalf of non-paying responsible operators. When the Trust Fund pays medical benefits on behalf of a nonpaying operator, it later seeks reimbursement from the operator responsible for the miner’s benefits. As detailed in Section II.B. of this preamble, the proposed regulations would change the formulas OWCP currently utilizes to calculate the amount paid for non-hospital health care services, outpatient hospital services, and inpatient hospital services.2 The Trust Fund currently pays for non-hospital and hospital services based on internally-derived payment formulas. The payment formulas in the proposed rule, however, are based on those utilized by CMS for 2 Proposed § 725.709 is a codification of the current payment formula for prescription drugs. Since adoption of this proposed rule would not change current practices or policies, it would have no economic impact on providers. As a result, proposed § 725.709 is not included in this analysis. E:\FR\FM\04JAP1.SGM 04JAP1 746 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules the payment of services under the Medicare program, and are similar to the payment formulas utilized by OWCP in the other programs it administers. Thus, the proposed rule would more closely conform Trust Fund medical payments to industry-wide standards for medical bill payment and more accurately reflect prevailing community rates for authorized treatments and services. This analysis provides the Department’s estimate of the economic impact of the proposed rule, both on the economy as a whole and at the firm level. The Department invites comments on this analysis from all interested parties. The Department is particularly interested in comments addressing the Department’s evaluation of the impact of the proposed rule on health care services providers and on miners’ access to providers and services. 1. Data Considered To determine the proposed rule’s general economic impact, the Department calculated the amount that the Trust Fund actually paid to health care services providers for medical services performed in Fiscal Year (FY) 2014 (current practice), and the amount the Trust Fund would have paid for the same services using the proposed payment formulas. The Department then compared the amounts to measure potential impact. Overall, the proposed rule would have saved the Trust Fund $3,154,267 for services rendered in FY 2014.3 Because payments are calculated mstockstill on DSK3G9T082PROD with PROPOSALS 3 The Trust Fund paid a total of $17,480,555 in FY 2014 for non-hospital health care services, outpatient hospital services, and inpatient hospital services. Of that total, it paid $2,672,782 for nonhospital services, $2,383,641 for outpatient hospital services, and $12,424,132 for inpatient hospital services. To provide context, in FY 2014, the Trust Fund also paid $152,397,971 in disability and survivor benefits under Part C of the BLBA. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 differently depending upon the type of health care services provider being reimbursed, the analysis below consists of three sections: (1) Non-hospital health care services (primarily physician services, but also services of other health care professionals including providers of durable medical equipment and ambulance suppliers); (2) hospital outpatient services; and (3) hospital inpatient services. The providers included in the dataset are those that were actually paid for covered services in FY 2014, including 1,210 non-hospital providers, 184 hospitals providing outpatient services, and 156 hospitals providing inpatient services. a. Non-Hospital Health Care Services Under proposed § 725.708, the Department would pay for non-hospital health care services with fee schedules derived from those utilized by CMS for payment under the Medicare program. See 42 CFR part 414. The Department estimates that under the proposed payment formulas, non-hospital health care services providers would receive, in aggregate, slightly less in payments from the Trust Fund than under current practice. The Trust Fund paid $2,672,782 for the non-hospital health care services provided in FY 2014. See Table 1. The Department estimates that under proposed § 725.708, the Trust Fund would have paid $2,664,290 for non-hospital health care services, a total decrease of only $8,492 (0.3%), far less than a 1% reduction. See Table 1. The Department estimates that nonhospital health care services providers in twelve states would experience a net aggregate reduction in payments from the Trust Fund, totaling $89,139. The largest decreases in dollar amount would occur in Kentucky ($39,338, a 4.5% decrease), Missouri ($17,056, a PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 40.9% decrease), and Virginia ($12,870, a 2.3% decrease). See Table 1. Nearly offsetting these reductions, however, providers in sixteen states would experience a net aggregate increase in payments from the Trust Fund, totaling $80,647. The largest increases by dollar amount would occur in Pennsylvania ($53,507, a 12.3% increase), Tennessee ($10,095, a 5.4% increase) and Illinois ($7,444, a 23.3% increase). See Table 1. The aggregate payment decrease, $8,492, would represent a reduction in transfer payments from the Trust Fund to non-hospital health care services providers. This small aggregate reduction, however, represents the combination of reductions and increases spread over 1,210 non-hospital health care services providers.4 The Department therefore believes that proposed § 725.708 will not significantly affect non-hospital providers, or create issues for miners seeking access to these health care services providers. 4 In Sections V and VI of this preamble, the Department uses the terms ‘‘provider,’’ ‘‘entity,’’ and ‘‘firm’’ interchangeably. The OWCP data used as part of the analyses in Sections V and VI is based on provider-level data as identified by provider number in its billing system. The U.S. Census Bureau and the U.S. Small Business Administration, by contrast, publish data (used to assess the impact of the proposed rule in Sections V and VI) on a firm-level basis. A firm may consist of multiple establishments or providers, and the Department is unable to identify firms in its data. The Department believes, however, that there is not a meaningful difference between ‘‘providers’’ and ‘‘firms’’ in this context because the great majority of non-hospital and hospital small firms that provide medical services to miners consist of single providers or establishments. As a result, the Department believes that the use of firm-level data instead of provider-level data does not materially impact its analysis and, if it has any effect, results in an overstatement of the proposed rule’s economic impact. E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Under proposed § 725.710, the Department would pay for outpatient services with an outpatient prospective payment system (OPPS) derived from the OPPS utilized by CMS for payment under the Medicare program. The Department estimates that under proposed § 725.710, there would be a reduction in payments from the Trust Fund to hospitals for outpatient services. Under current practice, the Trust Fund paid $2,383,641 for VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 outpatient services rendered in FY 2014. The Department estimates that, under proposed § 725.710, the Trust Fund would have paid $664,098, a decrease of $1,719,543 (or 72%). See Table 2. The Department estimates that hospitals in twenty states would receive reduced payments. The largest decreases by dollar amount would occur in Kentucky ($902,425, a decrease of 74%), Virginia ($327,304, a decrease of 77%), West Virginia ($148,104, a decrease of 60%); and Pennsylvania ($85,169, a decrease of 71%). See Table 2. Colorado is the PO 00000 Frm 00014 Fmt 4702 Sfmt 4702 only state that would see an increase in payments. The total estimated reduction in hospital outpatient payments is sizeable, but necessary to bring payments for black lung outpatient hospital care in line with industry standards. Under current practice, hospitals were paid, in aggregate, 431% of their costs for outpatient services performed in FY 2014, with payments to individual hospitals made at rates as E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.010</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS b. Hospital Outpatient Services 747 748 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules costs under the current practice are likely to be most impacted by proposed § 725.710. The Department, however, invites comments on these determinations. In particular, the Department seeks comments on whether any projected impact of the proposal on miners’ access to outpatient services would be short-term or long-term. program. The Department estimates that under proposed § 725.711, there would be a small reduction in payments from the Trust Fund to hospitals for inpatient services. Under current practice, the Trust Fund paid $12,424,132 for inpatient services rendered in FY 2014. See Table 3. The Department estimates that, under proposed § 725.711, the Trust Fund would have paid $10,997,900, a decrease of $1,426,232 (or 11.5%). See Table 3. The Department estimates that hospitals in eight states would maintained by CMS in their most recent publically available Impact File. 6 Total costs for hospital outpatient services performed in FY 2014 that would be paid for by the black lung program under the proposed rule are estimated at $552,549 by multiplying projected reimbursable charges by hospital and state outpatient cost-to-charge ratios maintained by CMS in their most recent publically available Impact File. Under proposed § 725.711, the Department would pay for hospital inpatient services under an inpatient prospective payment system (IPPS) derived from the IPPS utilized by CMS for payment under the Medicare 5 Total costs for hospital outpatient services performed in FY 2014 and paid for by the black lung program are estimated at $552,549 by multiplying actual billed reimbursable charges by hospital and state outpatient cost-to-charge ratios VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00015 Fmt 4702 Sfmt 4702 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.011</GPH> including the other OWCP programs, and at rates above those paid by Medicare. In aggregate, hospitals would be paid approximately 120% of costs for outpatient services under the proposed rule.6 The Department therefore believes that proposed § 725.710 will not affect miners’ access to care. Moreover, providers being paid significantly above c. Hospital Inpatient Services mstockstill on DSK3G9T082PROD with PROPOSALS high as 1,559% of costs.5 This divergence explains the need for a new payment formula. While proposed § 725.710 would result in an aggregate decrease in the transfer payments from the Trust Fund to hospitals for outpatient services, hospitals would continue to be paid at rates they are currently accepting from other small third-party payers, Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules mstockstill on DSK3G9T082PROD with PROPOSALS experience a net aggregate reduction of $2,301,580 in payments for inpatient services under proposed § 725.711. The largest decreases in dollar amount would occur in Kentucky ($1,291,411, a decrease of 26.2%), Virginia ($629,932, a decrease of 25.3%), and Florida ($205,315, a decrease of 71.9%). See Table 3. Hospitals in nine states would experience a net aggregate increase of $875,348 in payment for inpatient services under proposed § 725.711. The largest increases in dollar amount would occur in Alabama ($623,383, an increase of 152%), West Virginia ($86,455, an increase of 6.2%), and Pennsylvania ($79,664, an increase of 5.5%). Several factors contribute to these projected changes in payments among the states. First, analysis reveals that although the average payment per covered inpatient stay would decrease under proposed § 725.711, the Trust Fund would also pay for almost twice as many inpatient stays as under the current system. This change is because the DRG methodology focuses on the primary purpose for a hospital stay, which would result in more hospital stays being classified as black-lungrelated. By way of illustration, of the 996 inpatient stays that hospitals billed the black lung program for in FY 2014, the Trust Fund paid the full allowed VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 amount for 427 stays and a portion of the full amount for an additional 199 stays. In contrast, under proposed § 725.711, the Trust Fund would pay for 825 inpatient stays, all paid at the full allowed amount.7 Relatedly, because the cost of an individual inpatient stay may be quite high depending on the treatment provided, coverage of any given stay can greatly shift aggregate payments. For example, each lung transplant-related hospitalization occurring in FY 2014 for which the Trust Fund paid cost hundreds of thousands of dollars. Thus, covering or not covering even a single inpatient hospitalization can significantly increase or decrease aggregate Trust Fund payments. Finally, just as in the outpatient context, there is a wide disparity in pay-to-cost ratios among individual hospitals, with hospitals being paid up to 971% or more of costs under the current system.8 The states 7 The remaining 171 hospital stays billed to the Trust Fund were not covered stays (i.e., they are not for the treatment of totally disabling pneumoconiosis) and therefore would not be paid for by the Trust Fund. In most circumstances, hospitals stays billed to, but not paid by, the Trust Fund are paid for by Medicare or another insurer. 8 Total costs for hospital inpatient services performed in FY 2014 and paid for by the black lung program are estimated by multiplying actual billed reimbursable charges by hospital and state inpatient cost-to-charge ratios maintained by CMS PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 749 with the largest payment decreases under proposed § 725.711 include hospitals that are currently being paid at rates significantly above cost. While proposed § 725.711 would result in an aggregate decrease in the transfer payments from the Trust Fund to hospitals for inpatient services, hospitals would continue to be paid at rates they are accepting from other small third-party payers, including the other OWCP programs, and at rates above those paid by Medicare. These rates would result in hospitals being paid, in aggregate, approximately 155% of costs for inpatient services.9 The Department therefore believes that proposed § 725.711 will not significantly affect hospitals or affect miners’ access to inpatient hospital care. The Department, however, invites comments on these determinations. In particular, the Department seeks comments on whether any projected impact of the proposal on miners’ access to outpatient services would be short-term or long-term. in their most recent publically available Impact File. 9 Total costs for hospital inpatient services performed in FY 2014 that would be paid for by the black lung program under the proposed rule are estimated at $7,095,760 by multiplying projected reimbursable charges by hospital and state inpatient cost-to-charge ratios maintained by CMS in their most recent publically available Impact File. E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules mstockstill on DSK3G9T082PROD with PROPOSALS 2. Economic Impact Summary The Department believes that the proposed rule will not have a significant impact on the economy as a whole, and will have only a de minimis impact on firms that provide black lung-related health care to entitled miners. The Department has used a $100 million dollar annual threshold for determining the proposed rule’s significance. See, e.g., E.O. 12866 (defining regulation that has annual effect on the economy of $100 million or more as ‘‘significant’’). As shown in Section V.A.1. of this preamble, the Department estimates the proposed rule would result in an aggregate annual reduction in payments from the Trust Fund of $3,154,297 ($8,492 in reduced payments to nonhospital providers, $1,719,543 in reduced payments for outpatient hospital services, and $1,426,232 in reduced payments for inpatient hospital services). Because this aggregate annual reduction in payments is far less than VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 $100 million, the Department has determined that the proposed rule will not have a significant impact on the economy as a whole. Likewise, the Department has determined that the proposed rule will have only a de minimis impact at the firm level. See Table 4. To determine the firm-level impact of the proposed rule, the Department first considered total industry revenues for both nonhospital health care services providers and hospitals. Non-hospital providers generated $827.9 billion in revenues, according to the U.S. Census Bureau’s Statistics of U.S. Businesses (SUSB) most recent data for 2012.10 Dividing 10 See https://www.census.gov//econ/susb/data/ susb2012.html. There is no exact proxy for the nonhospital health care services provider category. The Department has used North American Industry Classification System (NAICS) code 621(Ambulatory Health Care Services) as the proxy for such providers. This category is over inclusive because it includes types of providers not used by entitled miners. It is, however, the most reasonable PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 annual revenues by the number of firms in the sector in the entire U.S. (485,235),11 non-hospital providers generated average annual revenues of $1.7 million per firm. See Table 4. A total of 1,210 non-hospital providers rendered services to entitled miners in FY 2014. See Table 1. Based on an analysis of the Trust Fund payment data, the Department estimates that 420 firms (out of 1,210) would receive net reductions in payments from the Trust Fund under the proposed rule.12 The proxy because 91% of non-hospital health care services providers used by such miners are part of this category. The Department has performed the same analysis shown here at the 4-digit NAICS level and found that the conclusion of no significant impact did not change. 11 See https://www.census.gov//econ/susb/data/ susb2012.html. 12 As discussed in Section V.A.1. of the preamble, the Department estimated the number of providers that could be negatively affected by the proposed rule based on the number of providers receiving reimbursements from the Trust Fund that would see a decrease in the amount of reimbursement using E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.012</GPH> 750 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Department estimates that the aggregate reduction in payments for these 420 negatively affected firms would be $373,156. See Table 4. Thus, the average reduction in payments to each negatively affected firm would be $888 (373,156 divided by 420), or 0.05% (888 divided by 1,700,000) of average firm revenue. See Table 4. The Department believes that this average reduction is de minimis and would not significantly affect non-hospital providers. Hospitals generated $883.1 billion in revenues during 2012.13 Dividing annual revenues by the number of firms in the sector (3,497),14 hospital firms generated average annual revenues of $252.5 million. Based on Trust Fund payment data, OWCP found that a total of 184 hospital firms provided outpatient services to entitled miners in FY 2014. See Table 2. The Department estimates that 177 firms (out of 184) would receive net reductions in payments from the Trust Fund under the proposed rule.15 The Department estimates that the aggregate reduction in payments for these 177 negatively affected firms would be $1,720,182. See Table 4. Thus, the average reduction in payments to each negatively affected hospital providing outpatient services would be $9,719 (1,720,182 divided by 177), or 0.004% (9,719 divided by 252.5 million) of average annual revenue for mstockstill on DSK3G9T082PROD with PROPOSALS the proposed formulas versus current practice. See Table 5 infra for the geographic distribution of negatively affected non-hospital providers. 13 The Department has used NAICS code 622 (Hospitals) as the proxy for providers of both outpatient and inpatient services. 14 See https://www.census.gov//econ/susb/data/ susb2012.html. 15 See Section V.A.1. of the preamble and n.11. See Table 6 infra for the geographic distribution of negatively affected outpatient hospital providers. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 the negatively affected firms. See Table 4. The Department believes that this average reduction is de minimis and would not significantly affect hospital outpatient services providers. With respect to inpatient hospital services, Trust Fund payment data showed that 156 hospitals provided such services to entitled miners in FY 2014. See Table 3. The Department estimates that 80 firms (out of 156) would receive net reductions in payments from the Trust Fund under the proposed rule.16 The Department estimates that the aggregate reduction in payments for these 80 negatively affected firms would be $3,338,650. See Table 4. Thus, the average reduction in payments to each negatively affected hospital providing inpatient services would be $41,733 (3,338,650 divided by 80), or 0.016% (41,733 divided by 252.5 million) of average annual revenue. See Table 4. The Department believes that this average annual reduction in revenue is de minimis and would not significantly affect hospital inpatient services providers. Finally, the Department does not believe that any reduction in payments from the Trust Fund to firms that provide both outpatient and inpatient hospital services would be significant. For example, if payments to a particular firm for outpatient services were reduced by $9,719 (the average reduction for all providers of outpatient services) and payments to the same firm for inpatient services were reduced by $41,733 (the average reduction for all 16 See Section V.A.1. of the preamble and nn.11 & 14. See Table 7 infra for the geographic distribution of negatively affected inpatient hospital providers. PO 00000 Frm 00018 Fmt 4702 Sfmt 4702 751 providers of inpatient services), the combined reduction of $51,452 would represent only 0.2% (51,452 divided by 252.5 million) of average firm revenue. Notably, some firms that provide both types of services (outpatient and inpatient) may experience a reduction in payments for only one type of service, while simultaneously experiencing an offsetting increase in payments for the other type of service. Neither does the Department believe that the rule’s impact will increase over time. While the total amount of payments by the Trust Fund to providers for medical services and treatments may decrease over time as the number of entitled miners receiving benefits declines, the decrease in payments would result from the decline in the number of beneficiaries, not the proposed rule.17 In sum, the Department believes that the estimated aggregate annual reduction in Trust Fund payments of $3,154,297 will not have a significant impact on the economy. Similarly, the Department believes that the reduction in annual revenue for negatively affected firms (0.05% of average annual revenue for non-hospital health care services providers, 0.004% of average annual revenue for hospitals providing outpatient services, and 0.016% of average annual revenue for hospitals providing inpatient services) will not have a significant impact on those individual firms. 17 For example, in FY 2005, the Trust Fund paid approximately $51.2 million to providers for medical services and treatments for 16,794 entitled miners. By FY 2014, Trust Fund payments had dropped to $17.5 million (not adjusted for inflation) for 6,189 entitled miners. E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules B. Other Considerations The Department considered numerous options and methods before proposing these payment formulas for the black lung program. The Department believes that the proposed formulas and methods best serve the interests of all stakeholders. The proposed rule would bring medical payments under the black lung program in line with today’s industry-wide practice, protect the Trust Fund from excessive payments, and compensate health care services providers sufficiently to ensure that entitled miners have continued access to medical care. Thus, the adoption of the payment formulas, as set forth in proposed §§ 725.707–725.711, has multiple advantages. In addition, the Department will realize some economies of scale by using payment formulas that are similar to those in OWCP’s other compensation programs. Maintaining a wholly separate system for black lung medical bill payments has required increased administration and therefore increased costs. It has also led to disparities in provider reimbursements. The proposed payment formulas, like other modern medical payment methodologies, have built-in cost control mechanisms that help prevent inaccurate payments and would therefore preserve Trust Fund assets. Also, because the amounts paid under these formulas reflect industry standards, recouping medical benefits paid by the Trust Fund on an interim VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 basis from liable operators and their insurance carriers should be routine. And by migrating to the new system, the Department hopes to shorten the time period for reimbursements, thus benefitting providers with prompt payment. Finally, the proposed rule will benefit claimants, liable operators, insurance carriers, medical service providers, and secondary medical payers simply by improving the clarity of the black lung medical bill payment process. VI. Regulatory Flexibility Act and Executive Order 13272 (Proper Consideration of Small Entities in Agency Rulemaking) The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601 et seq., establishes ‘‘as a principle of regulatory issuance that agencies shall endeavor, consistent with the objectives of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the business, organizations, and governmental jurisdictions subject to regulation.’’ Public Law 96–354. As a result, agencies must determine whether a proposed rule may have a ‘‘significant’’ economic impact on a ‘‘substantial’’ number of small entities, including small businesses, not-forprofit organizations, and small governmental jurisdictions. See 5 U.S.C. 603. If the agency estimates that a proposed rule would have a significant impact on a substantial number of small PO 00000 Frm 00019 Fmt 4702 Sfmt 4702 entities, then it must prepare a regulatory flexibility analysis as described in the RFA. Id. However, if a proposed rule is not expected to have a significant impact on a substantial number of small entities, the agency may so certify and a regulatory flexibility analysis is not required. See 5 U.S.C. 605(b). The certification must include a statement providing the factual basis for this determination, and the reasoning should be clear. The RFA does not define ‘‘significant’’ or ‘‘substantial.’’ 5 U.S.C. 601. It is widely accepted, however, that ‘‘[t]he agency is in the best position to gauge the small entity impacts of its regulations.’’ SBA Office of Advocacy, ‘‘A Guide for Government Agencies: How to Comply with the Regulatory Flexibility Act,’’ at 18 (May 2012) (‘‘SBA Guide for Government Agencies’’).18 One measure for determining whether an economic impact is ‘‘significant’’ is the percentage of revenue affected. For this rule, the Department used as a standard of significant economic impact whether the costs for a small entity equal or exceed 3% of the entity’s annual revenue. Similarly, one measure for determining whether a ‘‘substantial’’ number of small entities are affected is the percentage of small entities affected on an industry-wide basis. For this rule, the Department has used as a standard 18 Accessed at http://www.sba.gov/sites/default/ files/rfaguide_0512_0.pdf. E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.013</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS 752 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules to measure a ‘‘substantial number of small entities’’ whether 15% or more of the small entities in a given industry are significantly affected. The regulatory flexibility analysis for this NPRM is based on these two measures.19 Although the proposed rule is not expected to have a significant economic impact on a substantial number of small entities, the Department has conducted this initial regulatory flexibility analysis to aid stakeholders in understanding the impact of the proposed rule on small entities and to obtain additional information on such impacts. The Department invites interested parties to submit comments on the analysis, including the number of small entities affected by the proposed rule, the cost estimates, and whether alternatives exist that would reduce the burden on small entities. In particular, because the Department does not have access to revenue data for affected providers (and, thus, based this analysis on nationwide revenue averages), the Department is particularly interested in receiving comments regarding the proposed rule’s potential revenue impact on affected firms. mstockstill on DSK3G9T082PROD with PROPOSALS A. Description of the Reasons That Action by the Agency Is Being Considered The Department’s current regulations specify that payments for medical services and treatments must be paid at ‘‘no more than the rate prevailing in the community [where the provider is located].’’ 20 CFR 725.706(c). But the rules do not address how that rate should be determined. Currently, OWCP applies internally-derived formulas to determine payments for services and treatments under the BLBA. The current system, however, is difficult to administer and, in some instances, may not accurately reflect prevailing community rates. In addition, because the current payment formulas do not 19 The Department has used the threshold of 3% of revenues for the definition of significant economic impact and the threshold of 15% for the definition of substantial number of small entities affected in a number of recent rulemakings. See, e.g., Wage and Hour Division, Establishing a Minimum Wage for Contractors, Notice of Proposed Rulemaking, 79 FR 34568, 34603 (June 17, 2014); Office of Federal Contract Compliance Programs, Government Contractors, Requirement To Report Summary Data on Employee Compensation, Notice of Proposed Rulemaking, 79 FR 46562, 46591 (Aug. 8, 2014). The 3% and 15% standards are also consistent with the standards utilized by various other Federal agencies in conducting their regulatory flexibility analyses. See, e.g., Department of Health and Human Services Centers for Medicare & Medicaid Services, ‘‘Medicare and Medicaid Programs; Regulatory Provisions To Promote Program Efficiency, Transparency, and Burden Reduction; Part II; Final Rule,’’ 79 FR 27106, 27151 (May 12, 2014). VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 always reflect standard industry practice, the Department has encountered resistance from operators and insurance carriers when seeking reimbursement for medical benefits initially paid by the Trust Fund on an interim basis or when the Department seeks to enforce a final benefit award. B. Objectives of, and Legal Basis for, the Proposed Rule Section 426(a) of the BLBA authorizes the Secretary to ‘‘issue such regulations as he deems appropriate to carry out the provisions of this title.’’ 30 U.S.C. 936(a). The proposed rule adopts formulas for the payment of medical services and treatments under the black lung program that are derived from those used in the Medicare program and are similar to the payment formulas utilized in the other compensation programs that OWCP administers. The proposed payment formulas conform to current industry practice, and more accurately reflect prevailing community rates. The proposed rule, therefore, will help prevent inaccurate payments, control health care costs, streamline the processing of bills, and provide for similar payment policies and practices throughout all OWCP programs. C. Number of Small Entities Affected 1. Introduction The Regulatory Flexibility Act requires an agency to describe and, where feasible, estimate the number of small entities to which a proposed rule will apply. 5 U.S.C. 603(b)(3). Small entities include small businesses, small organizations, and small governmental jurisdictions. 5 U.S.C. 601(6). Under the RFA, small organizations are defined as not-for-profit, independently owned and operated enterprises, that are not dominant in their field. 5 U.S.C. 601(4); see also SBA Guide for Government Agencies at 14. To ensure it adequately addresses potential impact on small entities, the Department’s analysis assumes that all not-for-profit entities that provide medical services to miners under the BLBA are independently owned and operated, not dominant in their field, and thus are small organizations regardless of their revenue size. The data sources used in the Department’s analysis are the Small Business Administration (SBA) Table of Small Business Size Standards,20 the U.S. Census Bureau’s Statistics of U.S. Businesses (SUSB),21 and the U.S. 20 See http://www.sba.gov/content/smallbusiness-size-standards. 21 See https://www.census.gov/econ/susb/. PO 00000 Frm 00020 Fmt 4702 Sfmt 4702 753 Census Bureau’s Economic Census,22 which provide annual data on the number of firms, employment, and annual revenue by industry. The industrial classifications most directly affected by this rule are: (1) Ambulatory Health Care Services (North American Industry Classification System (NAICS) code 621), which includes offices of physicians, outpatient care centers,23 medical and diagnostic laboratories, and home health care services (collectively referred to as ‘‘non-hospital health care services providers’’ or ‘‘non-hospital providers’’); and (2) Hospitals (NAICS code 622). 2. The Department’s Analysis The Department estimated the number of small businesses of each provider type that could be negatively affected by the rule by multiplying (a) the percentage of small entities of that provider type in the industry as a whole by (b) the estimated number of black lung service providers of that type (both small and large entities) that could be negatively affected by the rule. The Department estimated the number of non-hospital and hospital providers that could be negatively affected by the proposed rule by comparing: (a) The amount that the Trust Fund actually paid to providers for medical services performed in Fiscal Year 2014 (current practice); and (b) the amount the Trust Fund would have paid to providers for the same services using the payment formulas in the proposed rule. See Section V.A.1. The next two subsections provide additional details on how the Department estimated the number of small, negatively impacted, nonhospital and hospital providers. a. Non-Hospital Health Care Service Providers According to SUSB data, there are 485,235 non-hospital health care services providers in the United States. Of that total, 482,584, or 99.5%, are classified as small businesses by the SBA (this includes both for-profit and not-for-profit businesses).24 Of the remaining 2,651 non-hospital providers that are not classified as small under the SBA definition, 1.7%—or 45 (2,651 × 0.17)—are classified as not-for-profit by the Economic Census, and thus considered small organizations (i.e., any not-for-profit entity that is independently owned and operated and 22 See http://factfinder.census.gov/. care centers are distinct from hospitals that provide outpatient services. 24 The SBA’s small business size standards for subsectors within the ambulatory health care services industry range from $7.5 million to $38.5 million. 23 Outpatient E:\FR\FM\04JAP1.SGM 04JAP1 754 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules mstockstill on DSK3G9T082PROD with PROPOSALS not dominant in its field). In total, the Department estimates that 482,629 nonhospital providers (482,584 classified as small under SBA revenue criteria, plus 45 additional not-for-profit providers) are small entities for purposes of the RFA. Thus, 99.5%, (482,629 divided by 485,235) of all non-hospital providers in VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 the United States are classified as small entities within the meaning of the RFA. To determine the number of small non-hospital providers that could be negatively impacted by the proposed rule, the Department multiplied the overall, industry-wide percentage of small, non-hospital providers (99.5%) by the number of non-hospital providers (both small and large) that the PO 00000 Frm 00021 Fmt 4702 Sfmt 4702 Department estimates could be negatively affected by the rule (420). See Table 5. That multiplication yielded an estimate that 418 small, non-hospital providers could be negatively affected by the rule. Table 5 provides information on all negatively impacted non-hospital providers, small and large, on a state-by-state basis. E:\FR\FM\04JAP1.SGM 04JAP1 755 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Table 5: Comparison of Trust Fund Payments to Negatively Affected Non-Hospital Health Care Services Providers for Services Performed 10/1/2013-9/30/2014 (Current Practice v. Estimated Payments Under the Proposed Rule). State Amount Billed By Negatively Affected Providers 1 Amount Paid to Negatively Affected Providers Under Current Practice Amount That W onld Be Paid to Negatively Difference Affected Providers Under The Proposed Rule Number of Negatively Affected Small Providers 2 •3 Number of Negatively Affected Providers Number of Providers Alabama $2,231 $1,873 $1,042 -$831 8 8 22 Arkansas $380 $380 $146 -$235 1 1 2 California $96 $88 $37 -$51 1 1 1 Colorado $9,594 $4,609 $3,689 -$920 5 5 13 Florida $9,565 $5,646 $4,703 -$943 7 7 22 Georgia $4,428 $2,109 $1,820 -$289 4 4 6 Illinois $16,751 $11,521 $10,096 -$1,425 15 15 41 Indiana $120,201 $52,751 $31,180 -$21,571 13 13 43 N/A N/A N/A N/A 0 0 1 Iowa Kansas N/A N/A N/A N/A 0 0 2 Kentucky $741,034 $415,171 $274,020 -$141,152 96 96 270 Maryland $8,861 $5,935 $3,626 -$2,309 4 4 12 Michigan $6,236 $3,242 $2,575 -$667 9 9 19 N/A N/A N/A N/A 0 0 1 $58,511 $35,142 $16,356 -$18,786 6 6 11 N/A N/A N/A N/A 0 0 2 $130 $101 $39 -$62 2 2 4 Minnesota Missouri Nevada New Jersey New Mexico North Carolina Ohio Pennsylvania South Carolina Tennessee N/A N/A N/A N/A 0 0 2 $14,153 $8,087 $5,697 -$2,390 7 7 12 $18,561 $11,811 $9,174 -$2,638 22 22 53 $216,092 $162,407 $138,619 -$23,788 79 79 244 $3,964 $1,486 $728 -$757 3 3 3 $97,484 $61,893 $44,958 -$16,935 46 46 118 Texas $5,715 $2,532 $2,392 -$140 1 1 2 Utah $20,678 $8,652 $7,774 -$879 4 4 7 Virginia $527,257 $291,673 $201,962 -$89,711 35 35 115 West Virginia $287,472 $166,771 $120,124 -$46,646 51 51 178 $71 $43 $12 -$31 1 1 4 VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00022 Fmt 4702 Sfmt 4725 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.014</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS Wyoming Total -$373,156 $2,169,465 $1,253,923 $880,769 418 420 1,210 Notes: 1 These amounts reflect actual amounts billed, including bills presented for non-covered medical services. 2 The estimated number of negatively affected small providers was derived by multiplying the number of negatively affected providers in each state by the percentage (99.5%) of non-hospital health care services providers categorized as small under RF A guidelines (i.e., including non-profit providers with revenues above the SBA threshold for small non-hospital entities). 3 The estimated numbers of negatively affected small providers were rounded for clarity, so will not total 418 exactly. 756 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules b. Hospitals According to SUSB data, there are 3,497 hospitals in the United States. Of that total, 1,547, or 44.2%, are classified as small businesses by the SBA (this includes both for-profit and not-forprofit businesses).25 Of the remaining 1,950 hospitals that are not classified as small under the SBA definition, 87.9%—or 1,714 (1,950 × 0.879)—are classified as not-for-profit by the Economic Census, and thus considered small organizations (i.e. any not-forprofit entity that is independently owned and operated and not dominant in its field). In total, the Department estimates that 3,261 hospitals (1,547 mstockstill on DSK3G9T082PROD with PROPOSALS 25 SBA defines a hospital provider as small if it has $38.5 million or less in annual revenue. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 classified as small under SBA revenue criteria, plus 1,714 additional not-forprofit hospitals) are small entities for purposes of the RFA. Thus, 93.3%, (3,261 divided by 3,497) of all hospitals in the United States are classified as small entities within the meaning of the RFA. To determine the number of small hospitals that could be negatively impacted by the proposed rule, the Department multiplied the overall, industry-wide percentage of small hospitals (93.3%) by the number of hospitals (both small and large) that the Department estimates could be negatively affected by the rule. The Department performed the abovedescribed analysis separately for: (a) Hospitals providing outpatient services to entitled black lung patients; and (b) PO 00000 Frm 00023 Fmt 4702 Sfmt 4702 hospitals providing inpatient services to entitled black lung patients. Specifically, for outpatient providers, the Department estimated that a total of 177 hospitals could be negatively affected by the proposed rule and that, of that total, 165 (or 93.3%) are small hospitals. See Table 2, Table 6. Similarly, for inpatient providers, the Department estimated that a total of 80 hospitals could be negatively affected by the proposed rule and that, of that total, 75 (or 93.3%) are small hospitals. Tables 6 and 7 provide information on all negatively impacted hospitals, small and large, on a state-by-state basis, addressing, respectively, hospitals providing outpatient services to black lung patients and hospitals providing inpatient services to black lung patients. E:\FR\FM\04JAP1.SGM 04JAP1 757 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Table 6: Comparison of Trust Fund Payments to Negatively Affected Hospital Outpatient Services Providers for Services Performed 10/1/2013-9/30/2014 (Current Practice v. Estimated Payments Under the Proposed Rule). State Amount That Would Be Amount Paid to Paid to Negatively Negatively Affected Affected Providers Providers Under Current Under The Practice Proposed Rule Amount Billed By Negatively Affected Providers 1 Difference Number of Negatively Affected Small Providers 2 · 3 Number of Negatively Affected Providers Number of Providers Alabama $16,684 $6,368 $1,913 -$4,456 5 5 5 Colorado $1,192 $556 $320 -$236 1 1 3 $16,678 $9,609 $1,485 -$8,124 3 3 3 1 1 1 11 12 14 Florida Georgia $1,969 $1,002 $195 -$807 Illinois $139,426 $109,545 $38,410 -$71,136 $74,182 $62,530 $13,532 -$48,997 9 10 10 Kentucky $1,663,284 $1,224,699 $322,274 -$902,425 33 35 35 Maryland $2,027 $2,027 $1,044 -$982 1 1 1 Michigan $1,515 $1,263 $601 -$663 1 1 1 Missouri $6,096 $1,5 54 $434 -$1,120 2 2 2 New Jersey $1,427 $354 $243 -$111 1 1 1 Indiana $1,209 $341 $311 -$30 1 1 1 North Carolina $22,119 $7,272 $2,759 -$4,513 4 4 4 Ohio $45,73 8 $41,173 $8,267 -$32,906 12 13 13 $825 $460 $356 -$104 1 1 1 $192,163 $119,569 $34,394 -$85,174 24 26 27 20 21 21 2 2 2 New Mexico Oklahoma Pennsylvania $179,825 $125,028 $42,433 -$82,595 $632 $358 $93 -$265 Virginia $524,313 $423,055 $95,751 -$327,304 10 11 11 West Virginia $290,722 $245,093 $96,894 -$148,199 23 25 26 Tennesee Utah Wyoming Total $188 $67 $32 -$35 1 $3,182,215 $2,381,923 $661,741 -$1,720,182 165 1 177 2 184 VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00024 Fmt 4702 Sfmt 4725 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.015</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS Notes: 1 These amounts reflect actual amounts billed, including bills presented for non-covered medical services. 2 The estimated number of negatively affected small providers was derived by multiplying the number of negatively affected providers in each state by the percentage (93 .3%) of hospital services providers categorized as small under RF A guidelines (i.e., including non-profit hospitals with revenues above the SBA threshold for small hospital entities). 3 The estimated numbers of negatively affected small providers were rounded for clarity, so will not total 165 exactly. Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules mstockstill on DSK3G9T082PROD with PROPOSALS D. Costs to Small Entities Affected The Department estimates that the proposed rule will not result in a significant impact (defined as 3% or more of annual revenue) on a substantial number of small entities (defined as 15% or more of all negatively affected small entities in the relevant industry). The relevant industries are defined as non-hospital health care services providers and hospitals. The Department has determined that the proposed rule will not impose any additional reporting, recordkeeping, or other compliance costs on affected entities. With respect VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 to the reduction in payments from the Trust Fund, the Department estimates that no small entities providing nonhospital health care services will experience a significant impact (a loss of 3% or more of annual revenues). As for hospitals, the Department estimates that hospitals with revenues/receipts between $100,000 and $499,900 providing outpatient services and hospitals with revenues/receipts between $100,000 and $999,999 providing inpatient services would experience a significant impact. Assuming that the affected hospitals exhibit the same revenue distribution as firms nationally, the Department PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 estimates that only one small firm providing outpatient services and two small firms providing inpatient services will be significantly impacted. These entities do not constitute a substantial number (15% or more) of the total number of negatively affected small hospitals providing either outpatient or inpatient services. 1. Estimated Reporting, Recordkeeping, and Other Compliance Costs to Small Entities Based on its analysis of available data, the Department has determined that the proposed rule will not impose any additional reporting, recordkeeping, or E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.016</GPH> 758 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules other compliance costs on providers. The proposed procedures for the submission and payment of medical bills conform to current industry standards for the processing of such bills. Providers are familiar with the proposed procedures and already have adequate billing systems in place for use in connection with other programs such as Medicare. Moreover, a number of provisions in the proposed rule simply codify current practice. Thus, the Department has determined that the proposed rule would not impose any additional reporting, recordkeeping, or compliance costs on providers, regardless of firm size. mstockstill on DSK3G9T082PROD with PROPOSALS 2. Estimated Costs to Small Entities From Changes in Payments by the Trust Fund In order to determine whether the proposed rule would result in a significant impact on any small businesses, the Department first estimated the revenues for negatively affected small entities of each provider type (non-hospital and hospital service providers) and then determined whether the estimated impact on those firms was significant. See Section V.A.2. The Department does not have individual revenue data for black lung service providers, but does have SBA data on the distribution of firms across the industry by revenue size. The Department therefore estimated the number of small negatively affected firms of each provider type in different revenue/receipts bands, by multiplying the industry-distribution percentage of firms in those revenue/receipts bands by the number of negatively affected black lung providers of that type, accounting VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 for the fact that all not-for-profit providers are classified as small entities. See Tables 8–10. The Department then determined whether the estimated cost to each firm, as calculated in Section V.A.2. of this preamble, was significant (a reduction in average annual revenue of 3% or more) to a firm in that revenue band. The Department determined that only 3 of the 658 negatively affected black lung providers in all provider categories were significantly impacted. See Tables 8–10, Table 11. The Department finally calculated whether the number of small providers of each type that would experience a significant impact as a result of the proposed rule represented a substantial percentage (15% or more) of all negatively affected small entities of that type, and determined that they did not. See Tables 8–10, Table 11. a. Non-Hospital Health Care Services Providers As discussed earlier, the Department estimates that 420 non-hospital health care services providers would experience a reduction in payments from the Trust Fund as a result of the proposed rule, and that 418 of these are estimated to be small entities. See VI.C.2.a., Table 4, Table 8, Table 11. Also, the Department estimates the annual cost of the proposed rule will be $888 for each negatively affected nonhospital health care services provider. See Section V.A.2., Table 4, Table 8, Table 11. The Department divided the estimated annual cost of the proposed rule to non-hospital health care services providers by the average revenue in each revenue band to estimate the average percentage of revenue lost by PO 00000 Frm 00026 Fmt 4702 Sfmt 4702 759 these providers. See Table 8. The Department acknowledges that uniformly applying the annual cost of the proposed rule across all negatively affected entities is an analytical assumption that likely does not reflect the true distribution of the costs of this proposed rule. However, OWCP does not have the data to develop a more accurate distribution of costs and believes that this proportional distribution likely overestimates the costs to the smallest providers. The costs of this proposed rule are small relative to the revenue and receipts of most providers and the impact of these costs might be hidden were OWCP to more heavily weight the distribution of costs towards larger firms. The Department believes this proportional distribution allows OWCP to focus this analysis on the impact on the smallest providers even though these impacts may be overstated. Based on these calculations, the Department does not believe that any of the negatively affected small entities providing nonhospital health care services will experience a significant impact (i.e., a loss of 3% or more of annual revenue) from the proposed rule. See Table 8, Table 11. For example, even in the lowest revenue band (less than $100,000 in annual revenue), the average annual revenue reduction resulting from the proposed rule would be only 1.77% ($888 divided by $50,173). See Table 8. The number of small non-hospital health care services providers that would experience a significant impact (zero) is plainly not a significant percentage (15% or more) of all such negatively affected small entities. E:\FR\FM\04JAP1.SGM 04JAP1 760 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Table 8: Costs to Negatively Affected Small Firms- Non-Hospital Health Care Services Providers Number of All Industry Firms Firm Size 1 • 2 Number of Negatively Annual Annual Revenue Affected Cost per for All Industry Small Firms Firm 4 Firms (418 Total)~ Annual Cost per Average Negatively Revenue per Affected Firm 5 Firm as Percent of Revenue• Firms with sales/receipts/revenue below $100,000 67,309 58 $888 $3,377,069,000 $50,173 1.77% Firms with sales/receipts/revenue of $100,000 to $499,999 193,782 168 $888 $53,752,291,000 $277,385 0.32% Firms with sales/receipts/revenue of $500,000 to $999,999 109,226 95 $888 $77,311,310,000 $707,811 0.13% Firms with sales/receipts/revenue of $1,000,000 to $2,499,999 74,584 65 $888 $112,002,453,000 $1,501,695 0.06% Firms with sales/receipts/revenue of $2,500,000 to $4,999,999 20,837 18 $888 $71,115,977,000 $3,412,966 0.03% Firms with sales/receipts/revenue of $5,000,000 to $7,499,999 6,554 6 $888 $3 8,84 7,269,000 $5,927,261 0.01% Firms with sales/receipts/revenue of $7,500,000 to $9,999,999 3,173 3 $888 $26,328,703,000 $8,297,732 0.01% Firms with sales/receipts/revenue of $10,000,000 to $14,999,999 3,222 3 $888 $36,800,355,000 $11,421,588 0.01% Firms with sales/receipts/revenue of $15,000,000 to $19,999,999 1,604 1 $888 $24,776,590,000 $15,446,752 0.01% Firms with sales/receipts/revenue of $20,000,000 to $24,999,999 897 1 $888 $17,319,311,000 $19,308,039 0.00% Firms with sales/receipts/revenue of $25,000,000 to $29,999,999 641 1 $888 $14,927,993,000 $23,28 8,601 0.00% Firms with sales/receipts/revenue of $30,000,000 to $34,999,999 429 <1 $888 $11,900,102,000 $27,739,166 0.00% Firms with sales/receipts/revenue of $35,000,000 to $39,999,999 326 <1 $888 $9,749,213,000 $29,905,561 0.00% Firms with sales/receipts/revenue of $40,000,000 or greater 45 <1 $888 $5,604,847 $124,367 0.71% Notes: 1 The U.S. &nail Business Administration's small business size standards for subsectors within the ambulatory health care services industry range from $7.5 to $38.5 million. The Department used these thresholds to define small businesses in the analysis of the health care industry. 2 Per the RFA definitions, not-for-profit, independently owned and operated firms of any size, that are not dominant in their field, are considered smalL The revenue band of $40,000,000 or more includes only not-for-profits firms. The total number of firms ( 45) included in this revenue band was calculated by multiplying the percentage (1. 7%) of not-for-profit firms in the non-hospital health care services industry by the total number of large firms (2,651) identified in the SBA data. 3 The estimated numbers of negatively affected small firms were rounded for clarity, so will not total418 exactly. Any fraction under one was denoted <1. The annual cost per firm ($888) was derived by calculating the total cost of the proposed rule (i.e., the total net decrease in payments summed over all negatively affected firms, $373,156) and dividing by the total number of negatively affected firms (420). 5 The average revenue per firm was derived by dividing the total annual revenue for all industry firms by the number of industry firms. 6 The annual cost per negatively affected firm as a percent of revenue was derived by dividing the annual cost per firm by the average revenue per firm. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00027 Fmt 4702 Sfmt 4725 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.017</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS 4 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules b. Hospital Outpatient Service Providers The Department estimates that 177 hospitals that provide outpatient services to entitled miners would experience a reduction in payments from the Trust Fund as a result of the proposed rule, and that 168 of these hospitals are small. See VI.C.2.b., Table 4, Table 9, Table 11. Also, the Department estimates the annual cost of the proposed rule will be $9,719 for each negatively affected hospital outpatient services provider.26 See V.A.2., Table 4, Table 11. The Department divided the estimated mstockstill on DSK3G9T082PROD with PROPOSALS 26 As previously noted, the Department acknowledges that uniformly applying the annual cost of the proposed rule across all negatively affected entities likely overstates the impact on smaller providers. See Section VI.D.2.a. of the preamble. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 annual cost of the proposed rule for negatively affected hospital outpatient services providers by the average revenue in each revenue band to estimate the average percentage of revenue lost by these providers. See Table 9. Based on these calculations, the Department estimates that only one provider (in the $100,000–$499,000 revenue band) will experience a significant impact from the proposed rule. See Table 9. The Department estimates that this firm would experience a reduction in revenue of 3.73% ($9,719 divided by $260,292). See Table 9. Because this single entity represents only 0.6% (1 divided by 165) of all negatively affected small outpatient service entities, however, the proposed rule will not have a significant effect on a substantial number (15% or PO 00000 Frm 00028 Fmt 4702 Sfmt 4702 761 more) of all negatively affected small hospital outpatient service providers. See Table 11. Because revenue data for entities in the $0–100,000 revenue band is not available, see Table 9, the Department was unable to calculate whether the impact of the proposed rule on providers in that revenue band would be significant. Nonetheless, even assuming that the only negatively impacted entity in the $0–$100,000 revenue band also experienced a significant impact, only 1.2% (2 divided by 165) of negatively affected small entities would experience a significant impact. This impact is still less than the 15% threshold for determining whether a substantial number of all negatively affected small entities would experience a significant impact. E:\FR\FM\04JAP1.SGM 04JAP1 762 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Table 9: Costs to Negatively Affected Small Firms- Hospital Outpatient Services Providers Number of Number Negatively of All Affected Industry Small Firms Firms (165 Total) 3 Firm Size 1 •2 Firms wth sales/receipts/revenue below $100,000 Annual Annual Revenue Cost per for All Industry Industry Firms 5 Jlirm4 Average Revenue per Firm6 Annual Cost per Negatively Affeded Firm as Percent of Revenue 7 15 1 $9,719 l'\/A N/A N/A 24 I $9,719 $6,247,000 $260,292 3.73% 9 < 1 $9,719 $5,933,000 $659,222 1,47% 13 I $9,719 $24,443,000 $1,880,231 0.52% Firms wth sales/receipts/revenue of $2,500,000 to $4,999,999 83 4 $9,719 $337,257,000 $4,063,337 0.24% Firms wth sales/receipts/revenue of $5,000,000 to $7,499,999 137 7 $9,719 $847,157,000 $6,183,628 0.16% Firms wth sales/receipts/revenue of $7,500,000 to $9,999,999 153 8 $9,719 $1,311,989,000 $8,575,092 0.11% Firms wth sales/receipts/revenue of $10,000,000 to $14,999,999 293 15 $9,719 $3,603,160,000 $12,297,474 0.08% Firms wth sales/receipts/revenue of$15,000,000 to $19,999,999 243 12 $9,719 $4,175,289,000 $17,182,259 0.06% Firms wth sales/receipts/revenue of $20,000,000 to $24,999,999 200 10 $9,719 $4,297,241,000 $21,486,205 0.05% Firms wth sales/receipts/revenue of $25,000,000 to $29,999,999 !54 8 $9,719 $3,992,287,000 $25,923,942 0.04% 113 6 $9,719 $3,474,943,000 $30,751,708 0.03% 110 6 $9,719 $3,979,151,000 $36,174,100 0.03% 1,714 87 $9,719 $753,319,701,000 $439,509,744 0.00% Firms wth sales/receipts/revenue of $100,000 to $499,999 Firms wth sales/receipts/revenue of $500,000 to $999,999 Firms wth sales/receipts/revenue of $1,000,000 to $2,499,999 Firms wth sales/receipts/revenue of $30,000,000 to $34,999,999 Firms wth sales/receipts/revenue of $35,000,000 to $39,999,999 Firms wth sales/receipts/revenue of $40,000,000 or greater Notes: 1 The U.S. Small Business Administration's small business size standard for subsectors wthin the hospital industry is $38.5 million. The Department used this threshold to define small businesses in the analysis of the hospital industry. 2 Per the RFA definitions, not-for-profit, independently o\\fled and operated firms of any size, that are not dominant in their field, are considered small. The revenue band of $40,000,000 or more includes only not-for-profits firms. The total number of firms (1,714) included in this revenue band was calculated by multiplying the percentage (87.9%) of not-forprofit firms in the hospital industry by the total number of large firms (1,950) identified in the SBA data. 3 The estimated numbers of negatively affected small firms were rounded for clarity, so \\ill not total 165 exactly. Any fraction under one was denoted <I. 4 The annual cost per firm ($9, 719) was derived by calculating the total cost of the proposed rule (i.e., the total net Census website. Data for that revenue band were wthheld to avoid disclosing information of individual businesses. 6 The average revenue per firm was derived by dividing the total annual revenue for all industry firms by the number of industry firms. 7 The annual cost per negatively affected firm as a percent of revenue was derived by dividing the annual cost per firm by the average revenue per firm. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00029 Fmt 4702 Sfmt 4725 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.018</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS decrease in payments summed over all negatively affected firms, $1,720, 182) and dividing by the total number of negatively affected firms (177). 5 The annual and average revenue per firm for firms wth sales/receipts/revenue below $100,000 are not available on the Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules c. Hospital Inpatient Services Providers Finally, the Department estimates that 80 hospitals that provide inpatient services to entitled miners would experience an annual reduction in payments from the Trust Fund as a result of the proposed rule, and that 35 of these are small entities. See VI.C.2.b., Table 4, Table 10, Table 11. Also, the Department estimates the annual cost of the proposed rule will be $41,733 for each negatively affected hospital inpatient services provider. 27 See V.A.2., Tables 4, Table 11. The mstockstill on DSK3G9T082PROD with PROPOSALS 27 As previously noted, the Department acknowledges that uniformly applying the annual cost of the proposed rule across all negatively affected entities likely overstates the impact on smaller providers. See Section VI.D.2.a. of the preamble; n.34. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 Department divided the estimated annual cost of the proposed rule on each negatively affected hospital inpatient services provider by the average revenue in each revenue band to estimate the average percentage of revenue lost by these providers. See Table 10. Based on these calculations, the Department estimates that only two entities (one in the $100,000–$499,999 revenue band and one in the $500,000–$999,999 revenue band) will experience a significant impact (greater than 3% of annual revenue) from the proposed rule. See Table 10. Because these two entities represent only 2.6% (2 divided by 75) of all negatively affected entities, however, the proposed rule will not a have significant effect on a substantial number (15% or more) of all negatively PO 00000 Frm 00030 Fmt 4702 Sfmt 4702 763 affected hospital inpatient services providers. See Table 11. Because revenue data for entities in the $0–100,000 revenue band are not available, see Table 10, the Department was unable to calculate whether the impact of the proposed rule on providers in that revenue band would be significant. Assuming that the only negatively impacted entity in the $0– $100,000 revenue band also experienced a significant impact, only 4.0% (3 divided by 75) of all negatively affected small entities would experience a significant impact. This impact is still less than the 15% threshold for determining whether a substantial number of negatively affected small entities would experience a significant impact. E:\FR\FM\04JAP1.SGM 04JAP1 764 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules Table 10: Costs to Negatively Affected Small Firms- Hospital Inpatient Services Providers Number of Number Negatively Annual Annual Revenue of All Affected Cost per for All Industry Industry Small Firms Firm 4 Firms 5 Firms (75 total)' Firm Size 1 •2 Average Revenue per Firm6 Annual Cost per Negatively Affected Firms as Percent of Revenue' 15 <em $41,733 N/A N/A N/A Firms wth sales/receipts/revenue of $100,000 to $499,999 24 I $41,733 $6,247,000 $260,292 16.03% Firms wth sales/receipts/revenue of $500,000 to $999,999 9 <I $41,733 $5,933,000 $659,222 6.33% Firms wth sales/receipts/revenue of $1,000,000 to $2,499,999 13 <I $41,733 $24,443,000 $1,880,231 2.22% Firms wth sales/receipts/revenue of $2,500,000 to $4,999,999 83 2 $41,733 $337,257,000 $4,063,337 1.03% Firms wth sales/receipts/revenue of $5,000,000 to $7,499,999 137 3 $41,733 $847,157,000 $6,183,628 0.67% Firms wth sales/receipts/revenue of $7,500,000 to $9,999,999 153 4 $41,733 $1,311,989,000 $8,575,092 0.49% Firms wth sales/receipts/revenue of $10,000,000 to $14,999,999 293 7 $41,733 $3,603,160,000 $12,297,474 0.34% Firms wth sales/receipts/revenue of $15,000,000 to $19,999,999 243 6 $41,733 $4,175,289,000 $17,182,259 0.24% Firms wth sales/receipts/revenue of $20,000,000 to $24,999,999 200 5 $41,733 $4,297,241,000 $21,486,205 0.19% Firms wth sales/receipts/revenue of $25,000,000 to $29,999,999 154 4 $41,733 $3,992,287,000 $25,923,942 0.16% Firms wth sales/receipts/revenue of $30,000,000 to $34,999,999 113 3 $41,733 $3,474,943,000 $30,751,708 0.14% Firms wth sales/receipts/revenue of $35,000,000 to $39,999,999 110 3 $41,733 $3,979,151,000 $36,174,100 0.12% Firms wth sales/receipts/revenue of $40,000,000 or greater 1,714 39 $41,733 $753,319,701,000 $439,509,744 0.01% Notes: 1 The U.S. Small Business Administration's small business size standard for subsectors wthin the hospital industry is $38.5 million. The Department used this threshold to define small businesses in the analysis of the hospital industry. 2 Per the RFA definitions, not-for-profit, independently owned and operated firms of any size, that are not dominant in their field, are considered small. The revenue hand of $40,000,000 or more includes only not-for-profits firms. The total number of firms (I, 714) included in this revenue band was calculated by multiplying the percentage (87.9%) of not-forprofit firms in the hospital industry by the total number of large firms (1,950) identified in the SBA data. 3 The estimated numbers of negatively affected small firms =re rounded for clarity, so \Mll not total 75 exactly. Any fraction under one was denoted <I. 4 The annual cost per firm ($41,733) was derived by calculating the total cost of the proposed rule (i.e., the total net decrease in payments summed over all negatively affected firms, $3,33 R,650) and dividing hy the total num her of negatively affected firms (80). 5 The annual and average revenue per firm for firms wth sales/receipts/revenue below $100,000 are not available on the Census website. Data for that revenue hand were \Mthheld to avoid disclosing information of individual husinesses. 6 The average revenue per firm was derived by dividing the total annual revenue for all industry firms by the number of industry firms. 7 The annual cost per negatively affected firm as a percent of revenue was derived hy dividing the annual cost per firm hy the average revenue per firm. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 PO 00000 Frm 00031 Fmt 4702 Sfmt 4725 E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.019</GPH> mstockstill on DSK3G9T082PROD with PROPOSALS Firms wth sales/receipts/revenue below$100,000 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules In summary, the Department estimates that the proposed rule will not have a significant impact on any small entity providing non-hospital health care services. In addition, it will have a significant impact on only one small hospital entity providing outpatient services and two providing inpatient services. For each category of provider, the percentage of small entities experiencing a significant impact (loss of 3% or more of annual revenue) from the proposed rule (0% for professional F. Identification of Relevant Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rule mstockstill on DSK3G9T082PROD with PROPOSALS The Department is unaware of any rules that may duplicate, overlap, or conflict with the proposed rule. G. Description of Any Significant Alternatives to the Proposed Rule That Accomplish the Stated Objectives of Applicable Statutes and That Minimize Any Significant Impact of the Proposed Rule on Small Entities The RFA requires the Department to consider alternatives to the proposed rule that would minimize any significant economic impact on small entities without sacrificing the stated objectives of the applicable statute. There is no basis in the statute for exempting small firms from payment VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 medical services, 0.6% for outpatient hospital services, and 2.6% for inpatient hospital services) does not represent a substantial number (15% or more) of all negatively affected small entities in that category. Moreover, the Department’s calculations likely overestimate the impact of the proposed rule on negatively affected small entities. The per-provider loss calculations are based on an average of all entities in each category, regardless of size. The Department presumes that larger entities—i.e., those with revenue exceeding the SBA’s thresholds—treat more entitled miners, and thus receive larger total payments from the Trust Fund than smaller entities. Thus, the actual per-provider cost for small entities in each provider category likely will be smaller than the estimates used by the Department in this analysis. To ensure adequate consideration of the impact on small entities, however, the Department used these unlikely, category-wide average cost estimates to determine whether the rule would have a significant economic impact on a substantial number of small entities. rules or for providing different payment rules for small versus large firms. Moreover, providing different rules would defeat the proposed rule’s stated objective: To employ modern payment methods and streamline the payment process, while protecting the limited resources of the Trust Fund. comments regarding the costs and benefits of the proposed rule, with particular attention to the effects of the rule on small entities. H. Comments To Assist the Regulatory Flexibility Analysis Although the Department estimates that the proposed rule would not have a significant economic impact (more than 3% of revenue) on a substantial number of small entities (more than 15% in the industry), the Department would appreciate feedback on the data, factors, and assumptions used in its analysis. Accordingly, the Department invites all interested parties to submit PO 00000 Frm 00032 Fmt 4702 Sfmt 4702 VII. Unfunded Mandates Reform Act of 1995 Title II of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531 et seq., directs agencies to assess the effects of Federal Regulatory Actions on State, local, and tribal governments, and the private sector, ‘‘other than to the extent that such regulations incorporate requirements specifically set forth in law.’’ 2 U.S.C. 1531. For purposes of the Unfunded Mandates Reform Act, this rule does not include any Federal mandate that may result in increased expenditures by State, local, tribal governments, or increased expenditures E:\FR\FM\04JAP1.SGM 04JAP1 EP04JA17.020</GPH> E. Summary 765 766 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules by the private sector of more than $100,000,000. VIII. Executive Order 13132 (Federalism) The Department has reviewed this proposed rule in accordance with Executive Order 13132 regarding federalism, and has determined that it does not have ‘‘federalism implications.’’ E.O. 13132, 64 FR 43255 (Aug. 4, 1999). The proposed rule will not ‘‘have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government’’ if promulgated as a final rule. Id. IX. Executive Order 12988 (Civil Justice Reform) The proposed rule meets the applicable standards in Sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. X. Congressional Review Act The proposed rule is not a ‘‘major rule’’ as defined in the Congressional Review Act, 5 U.S.C. 801 et seq. If promulgated as a final rule, this rule will not result in: An annual effect on the economy of $100,000,000 or more; a major increase in costs or prices for consumers, individual industries, Federal, State or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreignbased enterprises in domestic and export markets. mstockstill on DSK3G9T082PROD with PROPOSALS List of Subjects in 20 CFR Part 725 Administrative practice and procedure, Black lung benefits, Claims, Coal miners’ entitlement to benefits, Health care, Reporting and recordkeeping requirements, Survivors’ entitlement to benefits, Total disability due to pneumoconiosis, Vocational rehabilitation, Workers’ compensation. For the reasons set forth in the preamble, the Department of Labor proposes to amend 20 CFR part 725 as follows: PART 725—CLAIMS FOR BENEFITS UNDER PART C OF TITLE IV OF THE FEDERAL MINE SAFETY AND HEALTH ACT, AS AMENDED 1. The authority citation for part 725 continues to read as follows: ■ VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 Authority: 5 U.S.C. 301; 28 U.S.C. 2461 note (Federal Civil Penalties Inflation Adjustment Act of 1990); Pub. L. 114–74 at sec. 701; Reorganization Plan No. 6 of 1950, 15 FR 3174; 30 U.S.C. 901 et seq., 902(f), 921, 932, 936; 33 U.S.C. 901 et seq.; 42 U.S.C. 405; Secretary’s Order 10–2009, 74 FR 58834. 2. Amend § 725.308 as follows: a. Remove paragraph (b); b. Redesignate paragraph (c) as paragraph (b); ■ c. Remove from the second sentence in paragraph (c) ‘‘However, except as provided in paragraph (b) of this section,’’. ■ 3. In part 725, revise subpart J as follows: ■ ■ ■ Subpart J—Medical Benefits and Vocational Rehabilitation Sec. 725.701 What medical benefits are available? 725.702 Who is considered a physician? 725.703 How is treatment authorized? 725.704 How are arrangements for medical care made? 725.705 Is prior authorization for medical services required? 725.706 What reports must a medical provider give to OWCP? 725.707 At what rate will fees for medical services and treatments be paid? 725.708 How are payments for professional medical services and medical equipment determined? 725.709 How are payments for prescription drugs determined? 725.710 How are payments for outpatient medical services determined? 725.711 How are payments for inpatient medical services determined? 725.712 When and how are fees reduced? 725.713 If a fee is reduced, may a provider bill the claimant for the balance? 725.714 How do providers enroll with OWCP for authorizations and billing? 725.715 How do providers submit medical bills? 725.716 How should a miner prepare and submit requests for reimbursement for covered medical expenses and transportation costs? 725.717 What are the time limitations for requesting payment or reimbursement for medical services or treatments? 725.718 How are disputes concerning medical benefits resolved? 725.719 What is the objective of vocational rehabilitation? 725.720 How does a miner request vocational rehabilitation assistance? Subpart J—Medical Benefits and Vocational Rehabilitation § 725.701 What medical benefits are available? (a) A miner who is determined to be eligible for benefits under this part or part 727 of this subchapter (see § 725.4(d)) is entitled to medical benefits as set forth in this subpart as of the date of his or her claim, but in no PO 00000 Frm 00033 Fmt 4702 Sfmt 4702 event before January 1, 1974. Medical benefits may not be provided to the survivor or dependent of a miner under this part. (b) A responsible operator, or where there is none, the fund, must furnish a miner entitled to benefits under this part with such medical services and treatments (including professional medical services and medical equipment, prescription drugs, outpatient medical services, inpatient medical services, and any other medical service, treatment or supply) for such periods as the nature of the miner’s pneumoconiosis and disability requires. (c) The medical benefits referred to in paragraphs (a) and (b) of this section include palliative measures useful only to prevent pain or discomfort associated with the miner’s pneumoconiosis or attendant disability. (d) An operator or the fund must also pay the miner’s reasonable cost of travel necessary for medical treatment (to be determined in accordance with prevailing United States government mileage rates) and the reasonable documented cost to the miner or medical provider incurred in communicating with the operator, carrier, or OWCP on matters connected with medical benefits. (e)(1) If a miner receives a medical service or treatment, as described in this section, for any pulmonary disorder, there will be a rebuttable presumption that the disorder is caused or aggravated by the miner’s pneumoconiosis. (2) The party liable for the payment of benefits may rebut the presumption by producing credible evidence that the medical service or treatment provided was for a pulmonary disorder apart from those previously associated with the miner’s disability, or was beyond that necessary to effectively treat a covered disorder, or was not for a pulmonary disorder at all. (3) An operator or the fund, however, cannot rely on evidence that the miner does not have pneumoconiosis or is not totally disabled by pneumoconiosis arising out of coal mine employment to defeat a request for coverage of any medical service or treatment under this subpart. (4) In determining whether the treatment is compensable, the opinion of the miner’s treating physician may be entitled to controlling weight pursuant to § 718.104(d). (5) A finding that a medical service or treatment is not covered under this subpart will not otherwise affect the miner’s entitlement to benefits. E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules § 725.702 Who is considered a physician? The term ‘‘physician’’ includes only doctors of medicine (MD) and doctors of osteopathy (DO) within the scope of their practices as defined by State law. No treatment or medical services performed by any other practitioner of the healing arts is authorized by this part, unless such treatment or service is authorized and supervised both by a physician as defined in this section and by OWCP. § 725.703 How is treatment authorized? (a) Upon notification to a miner of such miner’s entitlement to benefits, OWCP must provide the miner with a list of authorized treating physicians and medical facilities in the area of the miner’s residence. The miner may select a physician from this list or may select another physician with approval of OWCP. Where emergency services are necessary and appropriate, authorization by OWCP is not required. (b) OWCP may, on its own initiative, or at the request of a responsible operator, order a change of physicians or facilities, but only where it has been determined that the change is desirable or necessary in the best interest of the miner. The miner may change physicians or facilities subject to the approval of OWCP. (c) If adequate treatment cannot be obtained in the area of the claimant’s residence, OWCP may authorize the use of physicians or medical facilities outside such area as well as reimbursement for travel expenses and overnight accommodations. mstockstill on DSK3G9T082PROD with PROPOSALS § 725.704 How are arrangements for medical care made? (a) Operator liability. If an operator has been determined liable for the payment of benefits to a miner, OWCP will notify the operator or its insurance carrier of the names, addresses, and telephone numbers of the authorized providers of medical benefits chosen by an entitled miner, and require the operator or carrier to: (1) Notify the miner and the providers chosen that the operator or carrier will be responsible for the cost of medical services provided to the miner on account of the miner’s total disability due to pneumoconiosis; (2) Designate a person or persons with decision-making authority with whom OWCP, the miner and authorized providers may communicate on matters involving medical benefits provided under this subpart and notify OWCP, the miner and providers of this designation; VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 (3) Make arrangements for the direct reimbursement of providers for their services. (b) Fund liability. If there is no operator found liable for the payment of benefits, OWCP will make necessary arrangements to provide medical care to the miner, notify the miner and providers selected of the liability of the fund, designate a person or persons with whom the miner or provider may communicate on matters relating to medical care, and make arrangements for the direct reimbursement of the medical provider. § 725.705 Is prior authorization for medical services required? (a) Except as provided in paragraph (b) of this section, medical services from an authorized provider which are payable under § 725.701 do not require prior approval of OWCP or the responsible operator. (b) Except where emergency treatment is required, prior approval of OWCP or the responsible operator must be obtained before any hospitalization or surgery, or before ordering medical equipment where the purchase price exceeds $300. A request for approval of non-emergency hospitalization or surgery must be acted upon expeditiously, and approval or disapproval will be given by telephone if a written response cannot be given within 7 days following the request. No employee of the Department of Labor, other than a district director or the Chief, Medical Audit and Operations Section, DCMWC, is authorized to approve a request for hospitalization or surgery by telephone. § 725.706 What reports must a medical provider give to OWCP? (a) Within 30 days following the first medical or surgical treatment provided under § 725.701, the provider must furnish to OWCP and the responsible operator or its insurance carrier, if any, a report of such treatment. (b) In order to permit continuing supervision of the medical care provided to the miner with respect to the necessity, character and sufficiency of any medical care furnished or to be furnished, the provider, operator or carrier must submit such reports in addition to those required by paragraph (a) of this section as OWCP may from time to time require. Within the discretion of OWCP, payment may be refused to any medical provider who fails to submit any report required by this section. PO 00000 Frm 00034 Fmt 4702 Sfmt 4702 767 § 725.707 At what rate will fees for medical services and treatments be paid? (a) All fees charged by providers for any medical service, treatment, drug or equipment authorized under this subpart will be paid at no more than the rate prevailing for the service, treatment, drug or equipment in the community in which the provider is located. (b) When medical benefits are paid by the fund at OWCP’s direction, either on an interim basis or because there is no liable operator, the prevailing community rate for various types of service will be determined as provided in §§ 725.708–725.711. (c) The provisions of §§ 725.708– 725.711 do not apply to charges for medical services or treatments furnished by medical facilities of the U.S. Public Health Service or the Departments of the Army, Navy, Air Force and Veterans Affairs. (d) If the provisions of §§ 725.708– 725.711 cannot be used to determine the prevailing community rate for a particular service or treatment or for a particular provider, OWCP may determine the prevailing community rate by reliance on other federal or state payment formulas or on other evidence, as appropriate. (e) OWCP must review the payment formulas described in §§ 725.708– 725.711 at least once a year, and may adjust, revise or replace any payment formula or its components when necessary or appropriate. (f) The provisions of §§ 725.707– 725.711 apply to all medical services or treatments rendered on or after the effective date of this rule. § 725.708 How are payments for professional medical services and medical equipment determined? (a)(1) OWCP pays for professional medical services based on a fee schedule derived from the schedule maintained by the Centers for Medicare & Medicaid Services (CMS) for the payment of such services under the Medicare program (42 CFR part 414). The schedule OWCP utilizes consists of: An assignment of Relative Value Units (RVU) to procedures identified by Healthcare Common Procedure Coding System/Current Procedural Terminology (HCPCS/CPT) code, which represents the work (relative time and intensity of the service), the practice expense and the malpractice expense, as compared to other procedures of the same general class; an assignment of Geographic Practice Cost Index (GPCI) values, which represent the relative work, practice expense and malpractice expense relative to other localities throughout the country; and a monetary E:\FR\FM\04JAP1.SGM 04JAP1 768 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules value assignment (conversion factor) for one unit of value for each coded service. (2) The maximum payment for professional medical services identified by a HCPCS/CPT code is calculated by multiplying the RVU values for the service by the GPCI values for such service in that area and multiplying the sum of these values by the conversion factor to arrive at a dollar amount assigned to one unit in that category of service. (3) OWCP utilizes the RVUs published, and updated or revised from time to time, by CMS for all services for which CMS has made assignments. Where there are no RVUs assigned, OWCP may develop and assign any RVUs that OWCP considers appropriate. OWCP utilizes the GPCI for the locality as defined by CMS and as updated or revised by CMS from time to time. OWCP will devise conversion factors for professional medical services using OWCP’s processing experience and internal data. (b) Where a professional medical service is not covered by the fee schedule described in paragraph (a) of this section, OWCP may pay for the service based on other fee schedules or pricing formulas utilized by OWCP for professional medical services. (c) OWCP pays for medical equipment identified by a HCPCS/CPT code based on fee schedules or other pricing formulas utilized by OWCP for such equipment. mstockstill on DSK3G9T082PROD with PROPOSALS § 725.709 How are payments for prescription drugs determined? (a)(1) OWCP pays for drugs prescribed by physicians by multiplying a percentage of the average wholesale price, or other baseline price as specified by OWCP, of the medication by the quantity or amount provided, plus a dispensing fee. (2) All prescription medications identified by National Drug Code are assigned an average wholesale price representing the product’s nationally recognized wholesale price as determined by surveys of manufacturers and wholesalers, or another baseline price designated by OWCP. (3) OWCP may establish the dispensing fee. (b) If the pricing formula described in paragraph (a) of this section is inapplicable, OWCP may make payment based on other pricing formulas utilized by OWCP for prescription medications. (c) OWCP may, in its discretion, contract for or require the use of specific providers for certain medications. OWCP also may require the use of generic equivalents of prescribed medications where they are available. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 § 725.710 How are payments for outpatient medical services determined? (a)(1) Except as provided in paragraphs (b) and (c) of this section, OWCP pays for outpatient medical services according to Ambulatory Payment Classifications (APCs) derived from the Outpatient Prospective Payment System (OPPS) devised by the Centers for Medicare & Medicaid Services (CMS) for the Medicare program (42 CFR part 419). (2) For outpatient medical services paid under the OPPS, such services are assigned according to the APC prescribed by CMS for that service. Each payment is derived by multiplying the prospectively established scaled relative weight for the service’s clinical APC by a conversion factor to arrive at a national unadjusted payment rate for the APC. The labor portion of the national unadjusted payment rate is further adjusted by the hospital wage index for the area where payment is being made. Additional adjustments are also made as required or needed. (b) If a compensable service cannot be assigned or paid at the prevailing community rate under the OPPS, OWCP may pay for the service based on fee schedules or other pricing formulas utilized by OWCP for outpatient services. (c) This section does not apply to services provided by ambulatory surgical centers. § 725.711 How are payments for inpatient medical services determined? (a)(1) OWCP pays for inpatient medical services according to predetermined rates derived from the Medicare Inpatient Prospective Payment System (IPPS) used by the Centers for Medicare & Medicaid Services (CMS) for the Medicare program (42 CFR part 412). (2) Inpatient hospital discharges are classified into diagnosis-related groups (DRGs). Each DRG groups together clinically similar conditions that require comparable amounts of inpatient resources. For each DRG, an appropriate weighting factor is assigned that reflects the estimated relative cost of hospital resources used with respect to discharges classified within that group compared to discharges classified within other groups. (3) For each hospital discharge classified within a DRG, a payment amount for that discharge is determined by using the national weighting factor determined for that DRG, national standardized adjustments, and other factors which may vary by hospital, such as an adjustment for area wage levels. OWCP may also use other price PO 00000 Frm 00035 Fmt 4702 Sfmt 4702 adjustment factors as appropriate based on its processing experience and internal data. (b) If an inpatient service cannot be classified by DRG, occurs at a facility excluded from the Medicare IPPS, or otherwise cannot be paid at the prevailing community rate under the pricing formula described in paragraph (a) of this section, OWCP may pay for the service based on fee schedules or other pricing formulas utilized by OWCP for inpatient services. § 725.712 When and how are fees reduced? (a) A provider’s designation of the code used to identify a billed service or treatment will be accepted if the code is consistent with the medical and other evidence, and the provider will be paid no more than the maximum allowable fee for that service or treatment. If the code is not consistent with the medical evidence or where no code is supplied, the bill will be returned to the provider for correction and resubmission or denied. (b) If the charge submitted for a service or treatment supplied to a miner exceeds the maximum amount determined to be reasonable under this subpart, OWCP must pay the amount allowed by §§ 725.707–725.711 for that service and notify the provider in writing that payment was reduced for that service in accordance with those provisions. (c) A provider or other party who disagrees with a fee determination may seek review of that determination as provided in this subpart (see § 725.718). § 725.713 If a fee is reduced, may a provider bill the claimant for the balance? A provider whose fee for service is partially paid by OWCP as a result of the application of the provisions of §§ 725.707–725.711 or otherwise in accordance with this subpart may not request reimbursement from the miner for additional amounts. § 725.714 How do providers enroll with OWCP for authorizations and billing? (a) All non-pharmacy providers seeking payment from the fund must enroll with OWCP or its designated bill processing agent to have access to the automated authorization system and to submit medical bills to OWCP. (b) To enroll, the non-pharmacy provider must complete and submit a Form OWCP–1168 to the appropriate location noted on that form. By completing and submitting this form, providers certify that they satisfy all applicable Federal and State licensure and regulatory requirements that apply E:\FR\FM\04JAP1.SGM 04JAP1 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules to their specific provider or supplier type. (c) The non-pharmacy provider must maintain documentary evidence indicating that it satisfies those requirements. (d) The non-pharmacy provider must also notify OWCP immediately if any information provided to OWCP in the enrollment process changes. (e) All pharmacy providers must obtain a National Council for Prescription Drug Programs number. Upon obtaining such number, they are automatically enrolled in OWCP’s pharmacy billing system. (f) After enrollment, a provider must submit all medical bills to OWCP through its bill processing portal or to the OWCP address specified for such purpose and must include the Provider Number/ID obtained through enrollment, or its National Provider Number (NPI) or any other identifying numbers required by OWCP. mstockstill on DSK3G9T082PROD with PROPOSALS § 725.715 How do providers submit medical bills? (a) A provider must itemize charges on Form OWCP–1500 or CMS–1500 (for professional services, equipment or drugs dispensed in the office), Form OWCP–04 or UB–04 (for hospitals), an electronic or paper-based bill that includes required data elements (for pharmacies) or other form as designated by OWCP, and submit the form promptly to OWCP. (b) The provider must identify each medical service performed using the Current Procedural Terminology (CPT) code, the Healthcare Common Procedure Coding System (HCPCS) code, the National Drug Code (NDC) number, or the Revenue Center Code (RCC), as appropriate to the type of service. OWCP has discretion to determine which of these codes may be utilized in the billing process. OWCP also has the authority to create and supply codes for specific services or treatments. These OWCP-created codes will be issued to providers by OWCP as appropriate and may only be used as authorized by OWCP. A provider may not use an OWCP-created code for other types of medical examinations, services or treatments. (1) For professional medical services, the provider must list each diagnosed condition in order of priority and furnish the corresponding diagnostic code using the ‘‘International Classification of Disease, 10th Edition, Clinical Modification’’ (ICD–10–CM), or as revised. (2) For prescription drugs or supplies, the provider must include the NDC assigned to the product, and such other information as OWCP may require. VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 (3) For outpatient medical services, the provider must use HCPCS codes and other coding schemes in accordance with the Outpatient Prospective Payment System. (4) For inpatient medical services, the provider must include admission and discharge summaries and an itemized statement of the charges. (c)(1) By submitting a bill or accepting payment, the provider signifies that the service for which reimbursement is sought was performed as described, necessary, appropriate, and properly billed in accordance with accepted industry standards. For example, accepted industry standards preclude upcoding billed services for extended medical appointments when the miner actually had a brief routine appointment, or charging for the services of a professional when a paraprofessional or aide performed the service; industry standards prohibit unbundling services to charge separately for services that should be billed as a single charge. (2) The provider agrees to comply with all regulations set forth in this subpart concerning the provision of medical services or treatments and/or the process for seeking reimbursement for medical services and treatments, including the limitation imposed on the amount to be paid. § 725.716 How should a miner prepare and submit requests for reimbursement for covered medical expenses and transportation costs? (a) If a miner has paid bills for a medical service or treatment covered under § 725.701 and seeks reimbursement for those expenses, he or she may submit a request for reimbursement on Form OWCP–915, together with an itemized bill. The reimbursement request must be accompanied by evidence that the provider received payment for the service from the miner and a statement of the amount paid. Acceptable evidence that payment was received includes, but is not limited to, a copy of the miner’s canceled check (both front and back) or a copy of the miner’s credit card receipt. (b) OWCP may waive the requirements of paragraph (a) of this section if extensive delays in the filing or the adjudication of a claim make it unusually difficult for the miner to obtain the required information. (c) Reimbursements for covered medical services paid by a miner generally will be no greater than the maximum allowable charge for such service as determined under §§ 725.707–725.711. PO 00000 Frm 00036 Fmt 4702 Sfmt 4702 769 (d) A miner will be only partially reimbursed for a covered medical service if the amount he or she paid to a provider for the service exceeds the maximum charge allowable. If this happens, OWCP will advise the miner of the maximum allowable charge for the service in question and of his or her responsibility to ask the provider to refund to the miner, or credit to the miner’s account, the amount he or she paid which exceeds the maximum allowable charge. (e) If the provider does not refund to the miner or credit to his or her account the amount of money paid in excess of the charge allowed by OWCP, the miner should submit documentation to OWCP of the attempt to obtain such refund or credit. OWCP may make reasonable reimbursement to the miner after reviewing the facts and circumstances of the case. (f) If a miner has paid transportation costs or other incidental expenses related to covered medical services under this part, the miner may submit a request for reimbursement on Form OWCP–957 or OWCP–915, together with proof of payment. § 725.717 What are the time limitations for requesting payment or reimbursement for medical services or treatments? OWCP will pay providers and reimburse miners promptly for all bills received on an approved form and in a timely manner. However, absent good cause, no bill will be paid for expenses incurred if the bill is submitted more than one year beyond the end of the calendar year in which the expense was incurred or the service or supply was provided, or more than one year beyond the end of the calendar year in which the miner’s eligibility for benefits is finally adjudicated, whichever is later. § 725.718 How are disputes concerning medical benefits resolved? (a) If a dispute develops concerning medical services or treatments or their payment under this part, OWCP must attempt to informally resolve the dispute. OWCP may, on its own initiative or at the request of the responsible operator or its insurance carrier, order the claimant to submit to an examination by a physician selected by OWCP. (b) If a dispute cannot be resolved informally, OWCP will refer the case to the Office of Administrative Law Judges for a hearing in accordance with this part. Any such hearing concerning authorization of medical services or treatments must be scheduled at the earliest possible time and must take precedence over all other hearing E:\FR\FM\04JAP1.SGM 04JAP1 770 Federal Register / Vol. 82, No. 2 / Wednesday, January 4, 2017 / Proposed Rules requests except for other requests under this section and as provided by § 727.405 of this subchapter (see § 725.4(d)). During the pendency of such adjudication, OWCP may order the payment of medical benefits prior to final adjudication under the same conditions applicable to benefits awarded under § 725.522. (c) In the development or adjudication of a dispute over medical benefits, the adjudication officer is authorized to take whatever action may be necessary to protect the health of a totally disabled miner. (d) Any interested medical provider may, if appropriate, be made a party to a dispute under this subpart. § 725.719 What is the objective of vocational rehabilitation? § 725.720 How does a miner request vocational rehabilitation assistance? Each miner who has been determined entitled to receive benefits under part C of title IV of the Act must be informed by OWCP of the availability and advisability of vocational rehabilitation services. If such miner chooses to avail himself or herself of vocational rehabilitation, his or her request will be processed and referred by OWCP vocational rehabilitation advisors pursuant to the provisions of §§ 702.501 through 702.508 of this chapter as is appropriate. [FR Doc. 2016–31382 Filed 1–3–17; 8:45 am] mstockstill on DSK3G9T082PROD with PROPOSALS BILLING CODE 4510–CR–P VerDate Sep<11>2014 18:07 Jan 03, 2017 Jkt 241001 Federal Highway Administration 23 CFR Part 655 [FHWA Docket No. FHWA–2009–0139] RIN 2125–AF34 National Standards for Traffic Control Devices; the Manual on Uniform Traffic Control Devices for Streets and Highways; Maintaining Pavement Marking Retroreflectivity Federal Highway Administration (FHWA), U.S. Department of Transportation (DOT). ACTION: Supplemental notice of proposed amendments (SNPA); request for comments. AGENCY: The Manual on Uniform Traffic Control Devices (MUTCD) is incorporated in FHWA regulations and recognized as the national standard for traffic control devices used on all streets, highways, bikeways, and private roads open to public travel. The FHWA proposed in an earlier notice of proposed amendment (NPA) to amend the MUTCD to include standards, guidance, options, and supporting information related to maintaining minimum levels of retroreflectivity for pavement markings. Based on the review and analysis of the numerous comments received in response to the NPA, FHWA has substantially revised the proposed amendments to the MUTCD and, as a result, is issuing this SNPA. DATES: Comments must be received on or before May 4, 2017. Late-filed comments will be considered to the extent practicable. ADDRESSES: Mail or hand deliver comments to the U.S. Department of Transportation, Dockets Management Facility, 1200 New Jersey Avenue SE., Washington, DC 20590, or submit electronically at http:// www.regulations.gov. All comments should include the docket number that appears in the heading of this document. All comments received will be available for examination and copying at the above address from 9 a.m. to 5 p.m., e.t., Monday through Friday, except Federal holidays. Those desiring notification of receipt of comments must include a selfaddressed, stamped postcard or may print the acknowledgment page that appears after submitting comments electronically. In accordance with the Administrative Procedure Act, DOT solicits comments from the public to better inform its rulemaking process. SUMMARY: The objective of vocational rehabilitation is the return of a miner who is totally disabled by pneumoconiosis to gainful employment commensurate with such miner’s physical impairment. This objective may be achieved through a program of re-evaluation and redirection of the miner’s abilities, or retraining in another occupation, and selective job placement assistance. Dated: December 21, 2016. Leonard J. Howie III, Director, Office of Workers’ Compensation Programs. DEPARTMENT OF TRANSPORTATION PO 00000 Frm 00037 Fmt 4702 Sfmt 4702 The DOT posts these comments, without edit, to www.regulations.gov, as described in the system of records notice, DOT/ALL–14 FDMS, accessible through www.dot.gov/privacy. In order to facilitate comment tracking and response, we encourage commenters to provide their name, or the name of their organization; however, submission of names is completely optional. Whether or not commenters identify themselves, all timely comments will be fully considered. If you wish to provide comments containing proprietary or confidential information, please contact the agency for alternate submission instructions. Ms. Cathy Satterfield, Office of Safety, cathy.satterfield@dot.gov, (708) 283– 3552; or Mr. William Winne, Office of the Chief Counsel, william.winne@ dot.gov, (202) 366–1397, Federal Highway Administration, 1200 New Jersey Avenue SE., Washington, DC 20590. Office hours are from 8:00 a.m. to 4:30 p.m., e.t., Monday through Friday, except Federal holidays. FOR FURTHER INFORMATION CONTACT: SUPPLEMENTARY INFORMATION: Electronic Access and Filing You may submit or access all comments received by the DOT online through http://www.regulations.gov. Electronic submission and retrieval help and guidelines are available on the Web site. It is available 24 hours each day, 365 days this year. Please follow the instructions. An electronic copy of this document may also be downloaded from the Office of the Federal Register’s home page at: http://www.ofr.gov and the Government Publishing Office’s Web page at: http://www.gpo.gov and is available for inspection and copying, as prescribed in 49 CFR part 7, at the FHWA Office of Transportation Operations (HOTO–1), 1200 New Jersey Avenue SE., Washington, DC 20590. Furthermore, the text of the proposed revision is available on the MUTCD Internet Web site at http:// mutcd.fhwa.dot.gov. The proposed additions are shown in blue text and proposed deletions are shown as red strikeout text. The complete current 2009 edition of the MUTCD is also available on the same Internet Web site. A copy of the proposed revision is included at the conclusion of the preamble in this document and is also available as a separate document under the docket number noted above at http://www.regulations.gov. E:\FR\FM\04JAP1.SGM 04JAP1

Agencies

[Federal Register Volume 82, Number 2 (Wednesday, January 4, 2017)]
[Proposed Rules]
[Pages 739-770]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-31382]


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DEPARTMENT OF LABOR

Office of Workers' Compensation Programs

20 CFR Part 725

RIN 1240-AA11


Black Lung Benefits Act: Medical Benefit Payments

AGENCY: Office of Workers' Compensation Programs, Labor.

ACTION: Notice of proposed rulemaking; request for comments.

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SUMMARY: The Department is proposing revisions to regulations under the 
Black Lung Benefits Act (BLBA or Act) governing the payment of medical 
benefits. The Department is basing these rules on payment formulas that 
the Centers for Medicare & Medicaid Services (CMS) uses to determine 
payments under the Medicare program. The Department also intends to 
make the rules similar to those utilized in the other programs that the 
Office of Workers' Compensation Programs (OWCP) administers. These 
rules will determine the amounts payable for covered medical services 
and treatments provided to entitled miners, when those services or 
treatments are paid by the Black Lung Disability Trust Fund. In 
addition, the proposed rule would eliminate two obsolete provisions.

DATES: The Department invites written comments on the proposed 
regulations from interested parties. Written comments must be received 
by March 6, 2017.

ADDRESSES: You may submit written comments, identified by RIN number

[[Page 740]]

1240-AA11, by any of the following methods. To facilitate receipt and 
processing of comments, OWCP encourages interested parties to submit 
their comments electronically.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions on the Web site for submitting comments.
     Facsimile: (202) 693-1395 (this is not a toll-free 
number). Only comments of ten or fewer pages, including a FAX cover 
sheet and attachments, if any, will be accepted by FAX.
     Regular Mail or Hand Delivery/Courier: Submit comments on 
paper to the Division of Coal Mine Workers' Compensation, Office of 
Workers' Compensation Programs, U.S. Department of Labor, Suite C-3520, 
200 Constitution Avenue NW., Washington, DC 20210. The Department's 
receipt of U.S. mail may be significantly delayed due to security 
procedures. You must take this into consideration when preparing to 
meet the deadline for submitting comments.
    Instructions: All submissions received must include the agency name 
and the Regulatory Information Number (RIN) for this rulemaking. All 
comments received will be posted without change to http://www.regulations.gov, including any personal information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Michael Chance, Director, Division of 
Coal Mine Workers' Compensation, Office of Workers' Compensation 
Programs, U.S. Department of Labor, Suite C-3520, 200 Constitution 
Avenue NW., Washington, DC 20210. Telephone: 1-800-347-2502. This is a 
toll-free number. TTY/TDD callers may dial toll-free 1-877-889-5627 for 
further information.

SUPPLEMENTARY INFORMATION: 

I. Background of This Rulemaking

    The BLBA, 30 U.S.C. 901-944, provides for the payment of benefits 
to coal miners and certain of their dependent survivors on account of 
total disability or death due to coal workers' pneumoconiosis. 30 
U.S.C. 901(a); Usery v. Turner Elkhorn Min. Co., 428 U.S. 1, 5 (1976). 
Benefits are paid by either an individual coal mine operator that 
employed the coal miner (or its insurance carrier), or the Black Lung 
Disability Trust Fund. Director, OWCP v. Bivens, 757 F.2d 781, 783 (6th 
Cir. 1985).
    A miner who is entitled to disability benefits under the BLBA is 
also entitled to medical benefits. 33 U.S.C. 907, as incorporated by 30 
U.S.C. 932(a); 20 CFR 725.701. The current rules governing the payment 
of medical benefits are contained in 20 CFR part 725, subpart J. Under 
these rules, a miner is entitled to ``such medical, surgical, and other 
attendance and treatment, nursing and hospital services, medicine and 
apparatus, and any other medical service or supply, for such periods as 
the nature of miner's pneumoconiosis and disability requires.'' 20 CFR 
725.701(b).
    In most cases, a responsible operator is liable for the payment of 
medical benefits. But OWCP pays medical benefits from the Trust Fund in 
three instances: (1) If no responsible operator can be identified as 
the party liable for a claim, and the Trust Fund is liable as a result 
(id.); (2) when the identified responsible operator declines to pay 
benefits pending final adjudication of a claim (see 20 CFR 725.522, 
725.708(b)); and (3) when the responsible operator fails to meet its 
payment obligations on a final award (see 20 CFR 725.502). For interim 
payments made pending final adjudication, OWCP seeks reimbursement from 
the operator after the claim is finally awarded. 20 CFR 725.602(a). 
Likewise, OWCP seeks reimbursement for payments made when an operator 
fails to meet its obligations on a final award. 20 CFR 725.601.
    Current Sec.  725.706(c) provides that payment for medical benefits 
``shall be made at no more than the rate prevailing in the community in 
which the providing physician, medical facility or supplier is 
located.'' 20 CFR 725.706(c). The current regulations, however, do not 
address how the prevailing community rate for a particular medical 
service or treatment is determined. For medical benefits paid by the 
Trust Fund, the Division of Coal Mine Workers' Compensation (DCMWC) 
currently bases payment for professional medical services, medical 
equipment, and inpatient and outpatient medical services and 
treatments, on internally-derived payment formulas. DCMWC currently 
pays for prescription medications utilizing a payment formula similar 
to that employed by the three other workers' compensation programs that 
OWCP administers.
    The Department now proposes to revise Subpart J. Specifically, the 
Department proposes to base Trust Fund payments for all medical 
services and treatments rendered on or after the effective date of this 
rule on payment formulas derived from those used by CMS under the 
Medicare program. The proposed payment formulas are similar to those 
used by the other OWCP programs, but are tailored to the specific 
geography, medical conditions, and needs of black lung program 
stakeholders. See proposed Sec.  725.707. The proposal also gives OWCP 
the flexibility to depart from the payment formulas if they cannot be 
used to determine the prevailing community rate, and requires OWCP to 
review (and, if necessary, update, revise or replace) the payment 
formulas at least annually. See proposed Sec.  725.707(e). This 
flexibility will allow OWCP to timely address any issues that may 
result from the implementation and application of the payment formulas, 
including any impact on miners' access to health care.
    The Department believes that the proposed payment formulas more 
accurately reflect prevailing community rates for authorized treatments 
and services than do the internally-derived formulas that OWCP 
currently uses for the black lung program. Moreover, because the 
Department believes that responsible operators and their insurance 
carriers utilize payment formulas or fee schedules that are 
substantially similar to the proposed payment formulas, the Trust Fund 
is more likely to be fully reimbursed for the payments it makes on an 
interim basis. Thus, this change will serve to control the health care 
costs associated with the BLBA, conserve the Trust Fund's limited 
resources, and provide greater clarity and certainty with respect both 
to fees paid to providers and reimbursements sought from operators and 
carriers. Likewise, it will ensure more consistent payment policies 
across all of the compensation programs administered by OWCP. The 
Department invites comments on the proposed rule from all interested 
parties. The Department is particularly interested in comments 
addressing the impact of the proposed payment formulas on health care 
services providers and any resulting impact on miners' access to health 
care.

II. Summary of the Proposed Rule

A. General Provisions

    The Department is proposing several general revisions to advance 
the goals set forth in Executive Order 13563 (2012). That Order states 
that regulations must be ``accessible, consistent, written in plain 
language, and easy to understand.'' 76 FR 3821. See also E.O. 12866, 58 
FR 51735 (Sept. 30, 1993) (agencies must draft ``regulations to be 
simple and easy to understand, with the goal of minimizing the 
potential for uncertainty and litigation arising from such

[[Page 741]]

uncertainty''). Accordingly, the Department proposes numerous technical 
and stylistic changes to Subpart J to improve clarity, consistency, and 
readability.
    The Department proposes to remove the imprecise term ``shall'' 
throughout the sections that it is amending or republishing, and to 
substitute ``must,'' ``must not,'' ``will,'' or other situation-
appropriate terms. No alteration in meaning either results from or is 
intended by these changes, which are made in the following proposed 
regulations: Sec.  725.701, Sec.  725.703, Sec.  725.704, Sec.  
725.705, Sec.  725.706, Sec.  725.718, and Sec.  725.720.
    Consistent with the goal of making this regulation easier to 
understand, the Department proposes several additional technical 
changes. First, the Department proposes to replace references to ``the 
Office'' with ``OWCP'' because that acronym is more commonly used by 
stakeholders. As explained in current Sec.  725.101(a)(21), ``Office'' 
and ``OWCP'' both mean ``the Office of Workers' Compensation Programs, 
United States Department of Labor.'' Thus, no alteration in meaning 
either results from or is intended by this change, which is made in the 
following regulations: Sec.  725.703, Sec.  725.704, Sec.  725.705, and 
Sec.  725.706.
    Second, where appropriate, the Department proposes to replace 
references to a coal-mine ``operator'' with ``operator or carrier'' 
because Sec.  725.360(a)(4) makes any coal-mine operator's insurance 
carrier a party to the operator's claims. Because either an operator or 
a carrier may defend or pay claims for medical benefits, no alteration 
in meaning either results from or is intended by this change, which is 
made in the following regulations: Sec.  725.704, Sec.  725.706, and 
Sec.  725.718. Additionally, the Department proposes to replace a 
reference to ``insurer'' with the word ``carrier'' because, under Sec.  
725.101(a)(18), both mean an entity ``authorized under the laws of a 
State to insure employers' liability under workers' compensation 
laws.'' Thus, no alteration in meaning either results from or is 
intended by this change, which appears in Sec.  725.704.
    Third, where appropriate, for purposes of consistency with the rest 
of the Subpart, the Department proposes to substitute the broader term 
``provider'' for the term ``physician'' and/or ``facility'' as well as 
to substitute the term ``medical equipment'' for the term 
``apparatus.'' No alteration in meaning either results from or is 
intended by these changes, which are made in the following regulations: 
Sec.  725.701, Sec.  725.704, Sec.  725.705, and Sec.  725.706.
    Finally, to make the regulations clearer and more user-friendly, 
the Department proposes new titles, phrased in question form, for all 
of the regulations appearing in Subpart J.
    Executive Order 13563 also instructs agencies to review ``rules 
that may be outmoded, ineffective, insufficient, or excessively 
burdensome, and to modify, streamline, expand, or repeal them.'' The 
Department proposes to cease publication of two obsolete rules (20 CFR 
725.308(b) and 725.702). Because of the deletion of current Sec.  
725.702 and the addition of new rules adopting the payment formulas 
noted above, other current regulations (20 CFR 725.703-725.708 and 
725.710-725.711) will be renumbered.
    All technical and stylistic changes designated here are not 
included in the section-by-section explanation. All proposed 
substantive revisions to existing rules and all proposed new rules are 
discussed below.

B. Section-by-Section Explanation

Sec.  725.308 Time Limits for Filing Claims
    The Department proposes to discontinue publication of Sec.  
725.308(b) because it is obsolete. Current Sec.  725.308(b) establishes 
a time limit applicable to miners' claims for medical benefits filed 
under Section 11 of the Black Lung Benefits Reform Act, 30 U.S.C. 924a, 
repealed, Public Law 107-275, 2(c)(2), 116 Stat. 1926 (2002). For the 
reasons explained in the discussion under 20 CFR subpart J below, 
continued publication of regulations related to Section 11 is 
unnecessary. To implement this change, the Department also proposes 
conforming technical amendments to current Sec.  725.308(c), including 
renumbering current paragraph (c) as paragraph (b).
Subpart J--Medical Benefits and Vocational Rehabilitation
    The Department proposes multiple revisions and additions to the 
provisions governing medical benefits in Subpart J. Because the 
proposed changes are substantial, the Department has republished 
Subpart J in its entirety below.
    In the existing regulations and in compliance with Executive Order 
13563, the Department proposes to discontinue publication of Sec.  
725.702 because it is obsolete. 20 CFR 725.702. Section 725.702 
implements Section 11 of the Black Lung Benefits Reform Act passed in 
1977. 30 U.S.C. 924a, repealed, Public Law 107-275, 2(c)(2), 116 Stat. 
1926 (2002). Section 11 required the Secretary of Health, Education and 
Welfare to notify miners receiving benefits under Part B of the Act 
that they could file a claim for medical benefits under Part C of the 
Act. Current Sec. Sec.  725.308 and 725.702 required miners to file 
these claims on or before December 31, 1980, unless the period was 
extended for good cause shown. Few, if any, Section 11 claims for 
medical benefits only remain in litigation. In fact, Congress repealed 
Section 11 as obsolete in 2002. Thus, continued publication of this 
regulation is unnecessary. If any Section 11 claim results in 
litigation after the effective date of these regulations, the claim 
will continue to be governed by the criteria in the 2015 edition of the 
Code of Federal Regulations. As a consequence of the deletion of 
current Sec.  725.702, and the addition of new provisions regarding 
payments for medical services and treatments, other current regulations 
(20 CFR 725.703-725.708, 725.710-725.711) will be renumbered.
    The Department also proposes a new set of regulations that adopt 
payment formulas and related procedures for determining the prevailing 
community rate for medical benefits paid by the Trust Fund. The 
subheadings and other regulatory references in this discussion 
generally refer to the location of the proposed rule if promulgated as 
a final rule.
    Specifically, the Department proposes to replace current Sec.  
725.706(c) with proposed Sec. Sec.  725.707-725.717, which adopt 
payment formulas and procedures to determine the rates at which various 
medical services and treatments will be paid by the Trust Fund, as well 
as the rates at which OWCP will seek reimbursement from operators for 
medical benefits paid on an interim basis. Similar payment formulas are 
used by the other three workers' compensation programs that OWCP 
administers. Such payment formulas were first developed and adopted for 
use in claims under the Federal Employees' Compensation Act, 5 U.S.C. 
8101 et seq., in 1986. See 51 FR 8276-82 (Mar. 10, 1986). Subsequently, 
similar formulas were adopted for claims under the Longshore Act in 
1995 and for claims under the Energy Employees Occupational Illness 
Compensation Program Act, 42 U.S.C. 7384 et seq., in 2001. See 60 FR 
51347-48 (Oct. 2, 1995); 66 FR 28957-59, 79-80 (May 25, 2001).
    The payment formulas the Department proposes to adopt for claims 
under the BLBA (and those it already utilizes under the other OWCP 
programs) are derived from the payment formulas that CMS uses to 
determine payments for medical services and

[[Page 742]]

treatments under the Medicare program. The proposed formulas encompass 
locality-based payment rates for physician services and medical 
equipment (see proposed Sec.  725.708), as well as for outpatient and 
inpatient medical services (see proposed Sec. Sec.  725.710 and 
725.711, respectively). The Department also proposes, consistent with 
existing practice and similar to the other OWCP programs, to adopt a 
single national formula for the payment of prescription-drug costs. See 
proposed Sec.  725.709.
    Finally, the Department proposes to adopt specific procedures for 
providers to enroll with OWCP for authorization to submit medical bills 
for payment, and for miners to request reimbursement for covered 
medical expenses and transportation costs. See proposed Sec. Sec.  
725.714-725.717. Most of these provisions simply implement current 
procedures and, to the extent any differences are proposed, the 
procedures are consistent with current industry standards. Specific 
provisions proposed for addition to the regulations in Subpart J are 
discussed in detail below.
Sec.  725.701 What medical benefits are available?
    Proposed Sec.  725.701 is a revision of current Sec.  725.701. The 
Department proposes to combine current paragraphs (e) and (f), and add 
subdivisions to paragraph (e) for greater clarity and ease of 
comprehension. Likewise, the Department proposes to delete the 
confusing reference to ``other employer'' in paragraph (b). Proposed 
paragraph (b) also enumerates more clearly the medical services and 
treatments to which a miner is entitled. The terms ``service'' and 
``treatment'' are used interchangeably throughout Subpart J to indicate 
those benefits for which the responsible operator or Trust Fund may be 
liable. The Department proposes to revise paragraphs (d) and (e)(3) for 
greater clarity and readability. For the same reason, in paragraph (e), 
the Department proposes replacing the word ``supply'' with 
``treatment.'' Finally, the Department also proposes to replace the 
reference to ``district director'' in paragraph (d) with ``OWCP,'' as 
communication may be made with either the OWCP national or district 
offices.
Sec.  725.702 Who is considered a physician?
    Proposed Sec.  725.702 is substantively identical to current Sec.  
725.703. For consistency, however, osteopathic physicians (DO) are now 
identified in the same manner as other doctors of medicine (MD). The 
reference to ``district director'' in the final sentence is changed to 
``OWCP,'' as the supervision of care may be provided by either the OWCP 
national office or district offices, depending upon factors such as the 
geographic location of the miner or provider, the particular services 
or treatments required by the miner, and the relative resource levels 
in the OWCP national and district offices.
Sec.  725.703 How is treatment authorized?
    Proposed Sec.  725.703 is a revision of current Sec.  725.704 and 
contains only technical changes described in Section II-A above.
Sec.  725.704 How are arrangements for medical care made?
    Proposed Sec.  725.704 is a revision of current Sec.  725.705. 
References to ``such operator'' have been changed to ``the operator,'' 
``decisionmaking'' has been changed to ``decision-making,'' and ``such 
designation'' has been changed to ``this designation.'' The Department 
does not intend any substantive alteration to the current provision.
Sec.  725.705 Is prior authorization for medical services required?
    Proposed Sec.  725.705 is a revision of paragraphs (a) and (b) of 
current Sec.  725.706. The Department proposes to replace the reference 
to ``Chief, Branch of Medical Analysis and Services, DCMWC'' with 
``Chief, Medical Audit and Operations Section, DCMWC'' to reflect the 
correct title of the employee authorized to approve requests for 
hospitalization or surgery by telephone. Paragraph (c) of current Sec.  
725.706 is deleted and replaced by proposed Sec. Sec.  725.707-725.711 
(see below).
Sec.  725.706 What reports must a medical provider give to OWCP?
    Proposed Sec.  725.706 is a revision of current Sec.  725.707. The 
Department proposes to replace the reference to ``district director'' 
in paragraph (b) with ``OWCP,'' as payment determinations may be made 
by either the OWCP national or district offices.
Sec.  725.707 At what rate will fees for medical services and 
treatments be paid?
    Proposed Sec.  725.707 is a new provision that sets out general 
rules governing the payment of compensable medical bills by the Trust 
Fund. Paragraph (a) provides that the Trust Fund will pay no more than 
the prevailing community rate for medical services, treatments, drugs 
or equipment. Paragraph (b) provides that the prevailing community rate 
for various types of treatments and services will be determined under 
the provisions of Sec. Sec.  725.708-725.711. Paragraph (c), however, 
precludes the application of Sec. Sec.  725.708-725.711 to charges for 
services or treatments furnished by the U.S. Public Health Services or 
the Departments of the Army, Navy, Air Force or Veterans Affairs. 
Payment for services or treatments furnished by these providers is made 
under the provisions of proposed Sec.  725.707(d). Because the 
Department recognizes that there may be circumstances where the 
provisions of Sec. Sec.  725.708-725.711 cannot be used to determine 
the prevailing community rate, paragraph (d) permits OWCP to determine 
the prevailing community rate based on other payment formulas or 
evidence. Paragraph (e) requires OWCP to review the payment formulas in 
Sec. Sec.  725.708-725.711 annually, and permits OWCP to adjust, revise 
or replace any formula (or its components) when needed. This provision 
allows OWCP to change the payment formulas in Sec. Sec.  725.707-
725.711 (or replace them entirely) if, at any given time, OWCP finds 
that those formulas cannot be used to determine prevailing community 
rates, are adversely impacting miners' access to care, or are otherwise 
not appropriate. Finally, paragraph (f) makes Sec. Sec.  725.707-
725.711 applicable to all services and treatments provided on or after 
the rule's effective date.
Sec.  725.708 How are payments for professional medical services and 
medical equipment determined?
    Proposed Sec.  725.708 is a new provision to govern payments for 
compensable professional medical services and medical equipment. 
Paragraph (a) provides that OWCP will pay for professional medical 
services based on a fee schedule derived from the CMS Medicare program 
fee schedule. OWCP's fee schedule will be used to determine the 
prevailing rate paid for a given medical service in the community in 
which the provider is located. To calculate the maximum allowable 
payment, each professional service is identified by a Healthcare Common 
Procedure Coding System/Current Procedural Terminology (HCPCS/CPT) 
code,\1\ which is assigned a relative value for work, practice expense, 
and malpractice expense. OWCP proposes to utilize relative values 
established by CMS for the Medicare program. Where CMS does not have a 
relative value for

[[Page 743]]

a service, OWCP may develop and assign one. The relative value is 
multiplied by a relevant geographic adjustment factor as defined by 
CMS. The resulting value is then multiplied by a monetary conversion 
factor (which is defined by OWCP) to determine the prevailing community 
rate for each coded service. Some professional services are not covered 
by the fee schedule described in paragraph (a). Thus, paragraph (b) 
provides that payment for services not covered by the paragraph (a) fee 
schedule is derived from other fee schedules or pricing formulas 
utilized by OWCP for professional services. Finally, paragraph (c) 
provides that payment for medical equipment identified by a HCPCS/CPT 
code is based on fee schedules or pricing formulas utilized by OWCP for 
medical equipment.
---------------------------------------------------------------------------

    \1\ CPT codes are established and updated by the American 
Medical Association. HCPCS codes were developed by CMS to complement 
the CPT. The use of these codes is standard practice in the coding 
and processing of medical bills.
---------------------------------------------------------------------------

Sec.  725.709 How are payments for prescription drugs determined?
    Proposed Sec.  725.709 is a new provision to govern payment for 
compensable prescription drugs. It merely codifies existing policy and 
does not change current payment practice. Paragraph (a) provides for 
payment for prescribed medication at a percentage of the national 
average wholesale price (or another baseline price designated by OWCP). 
In addition, the provider of the drug will receive a flat-rate 
dispensing fee, to be set by OWCP. Paragraph (b) provides that where 
the pricing formula in paragraph (a) cannot be used, OWCP may make 
payment based on other pricing formulas. Lastly, paragraph (c) provides 
that OWCP may require the use of specific providers for certain 
medications and may require the use of generic versions of medications 
where available.
Sec.  725.710 How are payments for outpatient medical services 
determined?
    Proposed Sec.  725.710 is a new provision to govern payment for 
compensable outpatient medical services. Paragraph (a) provides that, 
where appropriate, OWCP will utilize the Outpatient Prospective Payment 
System (OPPS) devised by CMS for the Medicare program. Under OPPS, 
outpatient services are generally assigned to Ambulatory Payment 
Classifications based on their clinical and resource cost similarities. 
Payment rates are based on those classifications, adjusted by other 
factors, including the hospital wage index for the locality where the 
service is provided. The OPPS was first implemented by CMS in 2000, and 
the industry is familiar with this payment system for hospital 
outpatient services. Where outpatient services cannot be assigned or 
priced appropriately under the OPPS system, paragraph (b) provides that 
payment for the services will be based on fee schedules and other 
pricing formulas utilized by OWCP. Finally, paragraph (c) specifies 
that services provided at an ambulatory surgery center are not paid for 
under OPPS. Rather, such services are paid under Sec.  725.707(d).
Sec.  725.711 How are payments for inpatient medical services 
determined?
    Proposed Sec.  725.711 is a new provision to govern payment for 
compensable hospital inpatient services. Under paragraph (a), OWCP will 
pay for inpatient services utilizing a Diagnosis-Related Group (DRG) 
system derived from the Medicare Severity DRG (MS-DRG) methodology used 
by Medicare in the Inpatient Prospective Payment System (IPPS). DRG-
based pricing is the industry standard for determining the payment 
rates for inpatient hospital treatment and services. In addition to 
Medicare, it is used by the Department of Veterans' Affairs, and 
TRICARE (formerly known as the Civilian Health and Medical Program of 
the Uniformed Services (CHAMPUS)), as well as by numerous state 
workers' compensation programs and private insurance plans. Paragraph 
(a) specifies that hospital discharge diagnoses are classified into 
groups (DRGs) based on the patient's diagnosis and the procedures 
furnished. Each DRG is assigned a base payment rate, which is then 
adjusted for both geographic and provider-specific factors to determine 
the payment rate for each admission. Under paragraph (b), where a 
compensable inpatient service cannot be paid under the DRG system, 
payment for the service will be based on fee schedules or other pricing 
formulas utilized by OWCP.
Sec.  725.712 When and how are fees reduced?
    Proposed Sec.  725.712(a) is a new provision addressing reductions 
in requested fees. The Department proposes that, where a provider 
submits a properly coded bill, OWCP will pay no more than the maximum 
amount allowable under Sec. Sec.  725.707-725.711. Where a bill is 
improperly coded, OWCP will either return it to the provider for 
correction, or deny it outright. Under proposed paragraph (b), if a 
bill exceeds the maximum amount allowed under the regulations, OWCP 
will pay only the allowed amount and advise the provider of any 
reduction in the requested fee. Finally, consistent with current 
practice, proposed paragraph (c) provides that disputes over fee 
payments may be referred to the Department's Office of Administrative 
Law Judges. See 20 CFR 725.708, to be re-codified at 20 CFR 725.718.
Sec.  725.713 If a fee is reduced, may a provider bill the claimant for 
the balance?
    Proposed Sec.  725.713 is a new provision addressing reductions in 
requested fees. It codifies current OWCP policy. The proposed provision 
provides that if a fee has been reduced in accordance with this 
subpart, providers may not recover any additional amount from the 
miner. This provision thus would prohibit the practice of ``balance 
billing,'' which occurs when providers receive only a portion of their 
submitted charges from third-party payers and seek to recover the 
``balance'' from the patient.
Sec.  725.714 How do providers enroll with OWCP for authorizations and 
billing?
    Proposed Sec.  725.714 is a new provision, but it simply codifies 
OWCP's existing practice of requiring all non-pharmacy providers 
seeking payments from the Trust Fund to enroll in the OWCP bill payment 
processing system. Paragraph (a) requires non-pharmacy providers to 
enroll in the system and paragraph (b) specifies the manner of 
enrollment. Paragraph (c) requires non-pharmacy providers to maintain 
proof of their eligibility for enrollment in the system. Paragraph (d) 
requires non-pharmacy providers to notify OWCP of any change in the 
provider's enrollment information. Paragraph (e) explains that pharmacy 
providers are required to obtain a National Council for Prescription 
Drug Programs number, and that upon obtaining such number, they will be 
automatically enrolled in OWCP's pharmacy billing system. Finally, 
paragraph (f) requires providers to submit bills via a specified bill-
processing portal or to the requisite OWCP mailing address and to 
include any identifying numbers OWCP may require.
Sec.  725.715 How do providers submit medical bills?
    Proposed Sec.  725.715 is a new provision that prescribes the forms 
and documents providers must submit to be paid for rendering covered 
medical services or treatments to miners. Paragraph (a) lists the forms 
that a provider must submit for each type of service or treatment. 
Paragraph (b) sets out the coding or other information that must be 
included on the forms for each type of service or treatment. Finally, 
under paragraph (c), a provider, by submitting a bill or accepting 
payment, signifies that the

[[Page 744]]

service or treatment was necessary and appropriate and was billed in 
accordance with standard industry practices. In addition, paragraph (c) 
requires providers to comply with the regulations in Subpart J with 
respect to the provision of, and billing for, services and treatments.
Sec.  725.716 How should a miner prepare and submit requests for 
reimbursement for covered medical expenses and transportation costs?
    In some instances, a miner will pay for covered medical services 
out of his or her own pocket. Proposed Sec.  725.716 is a new provision 
that reflects existing procedures allowing the miner to be reimbursed 
for these payments. Proposed paragraph (a) requires the miner to submit 
the appropriate form along with an itemized bill and proof of payment 
for the services. Proposed paragraph (b) allows OWCP to waive these 
requirements if the delay between the time of the service and approval 
of the miner's claim makes it difficult to obtain this information. 
Proposed paragraph (c) provides for reimbursement at the rate allowed 
under proposed Sec. Sec.  725.707-725.711. If that reimbursement is 
less than the full amount the miner paid, proposed paragraph (d) places 
responsibility on the miner to seek a refund or a credit from the 
provider. But if those efforts fail, proposed paragraph (e) protects 
the miner by allowing OWCP to make a reasonable reimbursement based on 
the facts and circumstances in the particular case. Finally, proposed 
paragraph (f) specifies the form and documentation that a miner must 
submit to be reimbursed for travel costs and other incidental expenses 
related to obtaining covered medical services.
Sec.  725.717 What are the time limitations for requesting payment or 
reimbursement for medical services and treatments?
    Proposed Sec.  725.717 would impose a new time limitation on 
requests for payment or reimbursement for medical services and 
treatments. The proposed provision would require providers to request 
payment no later than one year after the end of the calendar year 
during which either the service or treatment was rendered or in which 
the miner received a final award of benefits, whichever is later. 
Miners seeking reimbursement for covered medical services are also 
governed by this provision. Time limitations on requests for payment 
will encourage providers and miners to act promptly and will help 
prevent delays in the submission of bills and reimbursement requests to 
the Trust Fund. OWCP may waive the time limitation if the provider or 
miner demonstrates good cause for the late submission of a payment or 
reimbursement request.
Sec.  725.718 How are disputes concerning medical benefits resolved?
    Proposed Sec.  725.718 is a revision of current Sec.  725.708. The 
Department proposes to revise paragraph (a) to clarify that the 
dispute-resolution procedures apply to disputes over the payment or 
cost of a particular medical service or treatment as well as to the 
miner's entitlement to such service or treatment. The current 
regulation requires that hearing requests on whether a miner is 
entitled to a service or treatment must be given priority over other 
hearing requests. The proposed provision does not change this 
requirement, but adds language to paragraph (b) clarifying that 
disputes over only the payment or cost of a service or treatment are 
not prioritized over other hearing requests. In paragraph (a) and (b), 
the Department also proposes to change the references to ``the district 
director'' to ``OWCP,'' as informal resolution efforts and referrals 
for hearing may be made by either the OWCP national or district 
offices. In addition, the Department proposes to replace the reference 
to ``the Director'' in the last sentence of paragraph (b) with 
``OWCP,'' and to edit the introductory clause in the first sentence of 
paragraph (b) for clarity and consistency. Finally, the Department 
proposes to replace the phrase ``over medical benefits'' in paragraph 
(d) with ``under this subpart,'' for clarity and to avoid redundancy.
Sec.  725.719 What is the objective of vocational rehabilitation?
    Proposed Sec.  725.719 is a revision of current Sec.  725.710. For 
conciseness and clarity, the Department proposes to replace the phrase 
``for work in or around a coal mine and who is unable to utilize those 
skills which were employed in the miner's coal mine employment'' in the 
first sentence with ``by pneumoconiosis.'' See 20 CFR 718.204(b)(1)(ii) 
(defining total disability as inability to ``engag[e] in gainful 
employment in the immediate area of his or her residence requiring the 
skills or abilities comparable to those of any employment in a mine or 
mines in which he or she previously engaged with some regularity over a 
substantial period of time''). No change in the meaning of the current 
provision is intended.
Sec.  725.720 How does a miner request vocational rehabilitation 
assistance?
    Proposed Sec.  725.720 is a revision of current Sec.  725.711 and 
contains only technical changes described in Section II-A above.

III. Statutory Authority

    Section 426(a) of the BLBA, 30 U.S.C. 936(a), authorizes the 
Secretary of Labor to prescribe rules and regulations necessary for the 
administration and enforcement of the Act.

IV. Information Collection Requirements (Subject to the Paperwork 
Reduction Act) Imposed Under the Proposed Rule

    The Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq., 
and its implementing regulations, 5 CFR part 1320, require that the 
Department consider the impact of paperwork and other information 
collection burdens imposed on the public. A Federal agency generally 
cannot conduct or sponsor a collection of information, and the public 
is generally not required to respond to an information collection, 
unless it is approved by the Office of Management and Budget (OMB) 
under the PRA and displays a currently valid OMB Control Number. In 
addition, notwithstanding any other provisions of law, no person may 
generally be subject to penalty for failing to comply with a collection 
of information that does not display a valid Control Number. See 5 CFR 
1320.5(a) and 1320.6.
    Although the proposed medical benefit payment rules in Subpart J 
contain collections of information within the meaning of the PRA (see 
proposed Sec. Sec.  725.715-725.716), these collections are not new. 
They are currently approved for use in the black lung program and other 
OWCP-administered compensation programs by OMB under Control Numbers 
1240-0007 (OWCP-915 Claim for Medical Reimbursement); 1240-0019 (OWCP-
04 Uniform Billing Form); 1240-0021 (OWCP-1168 Provider Enrollment 
Form); 1240-0037 (OWCP-957 Medical Travel Refund Request); 1240-0044 
(OWCP-1500 Health Insurance Claim Form). The requirements for 
completion of the forms and the information collected on the forms will 
not change if this rule is adopted in final. Since no changes are being 
made to the collections, the overall burdens imposed by the information 
collections will not change.
    While the Department has determined that the rule does not affect 
the general terms of the information collections or their associated 
burdens, consistent

[[Page 745]]

with requirements codified at 44 U.S.C. 3506(a)(1)(B), (c)(2)(B) and 
3507(a)(1)(D); 5 CFR 1320.11, the Department has submitted a series of 
Information Collection Requests to OMB for approval under the Paperwork 
Reduction Act of 1995 (PRA) in order to update the information 
collection approvals to reflect this rulemaking and provide interested 
parties a specific opportunity to comment under the PRA. Allowing an 
opportunity for comment helps to ensure that requested data can be 
provided in the desired format, reporting burden (time and financial 
resources) is minimized, collection instruments are clearly understood, 
and the impact of collection requirements on respondents can be 
properly assessed.
    In addition to having an opportunity to file comments with the 
Department, the PRA provides that an interested party may file comments 
on the information collection requirements in a proposed rule directly 
with OMB, at the Office of Information and Regulatory Affairs, Attn: 
OMB Desk Officer for DOL-OWCP, Office of Management and Budget, Room 
10235, 725 17th Street NW., Washington, DC 20503; by Fax: 202-395-5806 
(this is not a toll-free number); or by email: 
OIRA_submission@omb.eop.gov. Commenters are encouraged, but not 
required, to send a courtesy copy of any comments to the Department by 
one of the methods set forth above. OMB will consider all written 
comments that the agency receives within 30 days of publication of this 
Notice of Proposed Rulemaking (NPRM) in the Federal Register. In order 
to help ensure appropriate consideration, comments should mention at 
least one of the OMB control numbers cited in this preamble.
    OMB and the Department are particularly interested in comments 
that:
     Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
     Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
     Enhance the quality, utility, and clarity of the 
information to be collected; and
     Minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.
    The information collections in this rule may be summarized as 
follows. The number of responses and burden estimates listed are not 
specific to the black lung program; instead, the estimates are 
cumulative for all OWCP-administered compensation programs that collect 
this information.
    1. Title of Collection: Claim for Medical Reimbursement Form.
    OMB Control Number: 1240-0007.
    Total Estimated Number of Responses: 31,824.
    Total Estimated Annual Time Burden: 5,283 hours.
    Total Estimated Annual Other Costs Burden: $54,737.
    2. Title of Collection: Uniform Billing Form (OWCP-04).
    OMB Control Number: 1240-0019.
    Total Estimated Number of Responses: 190,970.
    Total Estimated Annual Time Burden: 21,811 hours.
    Total Estimated Annual Other Costs Burden: $0.
    3. Title of Collection: Provider Enrollment Form.
    OMB Control Number: 1240-0021.
    Total Estimated Number of Responses: 37,257.
    Total Estimated Annual Time Burden: 4,955 hours.
    Total Estimated Annual Other Costs Burden: $18,629.
    4. Title of Collection: Medical Travel Refund Request.
    OMB Control Number: 1240-0NEW.
    Total Estimated Number of Responses: 342,462.
    Total Estimated Annual Time Burden: 56,849 hours.
    Total Estimated Annual Other Costs Burden: $171,231.
    5. Title of Collection: Health Insurance Claim Form.
    OMB Control Number: 1240-0044.
    Total Estimated Number of Responses: 2,646,438.
    Total Estimated Annual Time Burden: 254,875 hours.
    Total Estimated Annual Other Costs Burden: $0.

V. Executive Orders 12866 and 13563 (Regulatory Planning and Review)

    Executive Orders 12866 and 13563 direct agencies to assess all the 
costs and benefits of the available alternatives to regulation and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, harmonizing rules, and promoting 
flexibility. It also instructs agencies to review ``rules that may be 
outmoded, ineffective, insufficient, or excessively burdensome, and to 
modify, streamline, expand, or repeal them.''
    The Department has considered the proposed rule with these 
principles in mind and has determined that the affected community will 
benefit from this regulation. The discussion below sets out the rule's 
anticipated economic impact and discusses non-economic factors favoring 
adoption of the proposal. The Office of Information and Regulatory 
Affairs of OMB has determined that the Department's rule represents a 
``significant regulatory action'' under Section 3(f)(4) of Executive 
Order 12866 and has reviewed the rule.

A. Economic Considerations

    The proposed rule could have an economic impact on parties to black 
lung claims and others, including health care services providers that 
furnish covered medical services to entitled miners. The rule is 
nevertheless necessary to define the prevailing community rate used to 
pay for particular medical services and treatments for the affected 
community. As explained in Section I of this preamble, miners found 
entitled to monthly disability benefits under the BLBA are also 
entitled to medical benefits, i.e., those medical services and 
treatments as the miner's pneumoconiosis and resulting disability 
require. The Trust Fund pays for medical benefits both when the Trust 
Fund is primarily liable for a claim and on behalf of non-paying 
responsible operators. When the Trust Fund pays medical benefits on 
behalf of a non-paying operator, it later seeks reimbursement from the 
operator responsible for the miner's benefits.
    As detailed in Section II.B. of this preamble, the proposed 
regulations would change the formulas OWCP currently utilizes to 
calculate the amount paid for non-hospital health care services, 
outpatient hospital services, and inpatient hospital services.\2\ The 
Trust Fund currently pays for non-hospital and hospital services based 
on internally-derived payment formulas. The payment formulas in the 
proposed rule, however, are based on those utilized by CMS for

[[Page 746]]

the payment of services under the Medicare program, and are similar to 
the payment formulas utilized by OWCP in the other programs it 
administers. Thus, the proposed rule would more closely conform Trust 
Fund medical payments to industry-wide standards for medical bill 
payment and more accurately reflect prevailing community rates for 
authorized treatments and services.
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    \2\ Proposed Sec.  725.709 is a codification of the current 
payment formula for prescription drugs. Since adoption of this 
proposed rule would not change current practices or policies, it 
would have no economic impact on providers. As a result, proposed 
Sec.  725.709 is not included in this analysis.
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    This analysis provides the Department's estimate of the economic 
impact of the proposed rule, both on the economy as a whole and at the 
firm level. The Department invites comments on this analysis from all 
interested parties. The Department is particularly interested in 
comments addressing the Department's evaluation of the impact of the 
proposed rule on health care services providers and on miners' access 
to providers and services.
1. Data Considered
    To determine the proposed rule's general economic impact, the 
Department calculated the amount that the Trust Fund actually paid to 
health care services providers for medical services performed in Fiscal 
Year (FY) 2014 (current practice), and the amount the Trust Fund would 
have paid for the same services using the proposed payment formulas. 
The Department then compared the amounts to measure potential impact. 
Overall, the proposed rule would have saved the Trust Fund $3,154,267 
for services rendered in FY 2014.\3\ Because payments are calculated 
differently depending upon the type of health care services provider 
being reimbursed, the analysis below consists of three sections: (1) 
Non-hospital health care services (primarily physician services, but 
also services of other health care professionals including providers of 
durable medical equipment and ambulance suppliers); (2) hospital 
outpatient services; and (3) hospital inpatient services. The providers 
included in the dataset are those that were actually paid for covered 
services in FY 2014, including 1,210 non-hospital providers, 184 
hospitals providing outpatient services, and 156 hospitals providing 
inpatient services.
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    \3\ The Trust Fund paid a total of $17,480,555 in FY 2014 for 
non-hospital health care services, outpatient hospital services, and 
inpatient hospital services. Of that total, it paid $2,672,782 for 
non-hospital services, $2,383,641 for outpatient hospital services, 
and $12,424,132 for inpatient hospital services. To provide context, 
in FY 2014, the Trust Fund also paid $152,397,971 in disability and 
survivor benefits under Part C of the BLBA.
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a. Non-Hospital Health Care Services
    Under proposed Sec.  725.708, the Department would pay for non-
hospital health care services with fee schedules derived from those 
utilized by CMS for payment under the Medicare program. See 42 CFR part 
414. The Department estimates that under the proposed payment formulas, 
non-hospital health care services providers would receive, in 
aggregate, slightly less in payments from the Trust Fund than under 
current practice. The Trust Fund paid $2,672,782 for the non-hospital 
health care services provided in FY 2014. See Table 1. The Department 
estimates that under proposed Sec.  725.708, the Trust Fund would have 
paid $2,664,290 for non-hospital health care services, a total decrease 
of only $8,492 (0.3%), far less than a 1% reduction. See Table 1.
    The Department estimates that non-hospital health care services 
providers in twelve states would experience a net aggregate reduction 
in payments from the Trust Fund, totaling $89,139. The largest 
decreases in dollar amount would occur in Kentucky ($39,338, a 4.5% 
decrease), Missouri ($17,056, a 40.9% decrease), and Virginia ($12,870, 
a 2.3% decrease). See Table 1. Nearly offsetting these reductions, 
however, providers in sixteen states would experience a net aggregate 
increase in payments from the Trust Fund, totaling $80,647. The largest 
increases by dollar amount would occur in Pennsylvania ($53,507, a 
12.3% increase), Tennessee ($10,095, a 5.4% increase) and Illinois 
($7,444, a 23.3% increase). See Table 1.
    The aggregate payment decrease, $8,492, would represent a reduction 
in transfer payments from the Trust Fund to non-hospital health care 
services providers. This small aggregate reduction, however, represents 
the combination of reductions and increases spread over 1,210 non-
hospital health care services providers.\4\ The Department therefore 
believes that proposed Sec.  725.708 will not significantly affect non-
hospital providers, or create issues for miners seeking access to these 
health care services providers.
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    \4\ In Sections V and VI of this preamble, the Department uses 
the terms ``provider,'' ``entity,'' and ``firm'' interchangeably. 
The OWCP data used as part of the analyses in Sections V and VI is 
based on provider-level data as identified by provider number in its 
billing system. The U.S. Census Bureau and the U.S. Small Business 
Administration, by contrast, publish data (used to assess the impact 
of the proposed rule in Sections V and VI) on a firm-level basis. A 
firm may consist of multiple establishments or providers, and the 
Department is unable to identify firms in its data. The Department 
believes, however, that there is not a meaningful difference between 
``providers'' and ``firms'' in this context because the great 
majority of non-hospital and hospital small firms that provide 
medical services to miners consist of single providers or 
establishments. As a result, the Department believes that the use of 
firm-level data instead of provider-level data does not materially 
impact its analysis and, if it has any effect, results in an 
overstatement of the proposed rule's economic impact.

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[[Page 747]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.010

b. Hospital Outpatient Services
    Under proposed Sec.  725.710, the Department would pay for 
outpatient services with an outpatient prospective payment system 
(OPPS) derived from the OPPS utilized by CMS for payment under the 
Medicare program. The Department estimates that under proposed Sec.  
725.710, there would be a reduction in payments from the Trust Fund to 
hospitals for outpatient services. Under current practice, the Trust 
Fund paid $2,383,641 for outpatient services rendered in FY 2014. The 
Department estimates that, under proposed Sec.  725.710, the Trust Fund 
would have paid $664,098, a decrease of $1,719,543 (or 72%). See Table 
2. The Department estimates that hospitals in twenty states would 
receive reduced payments. The largest decreases by dollar amount would 
occur in Kentucky ($902,425, a decrease of 74%), Virginia ($327,304, a 
decrease of 77%), West Virginia ($148,104, a decrease of 60%); and 
Pennsylvania ($85,169, a decrease of 71%). See Table 2. Colorado is the 
only state that would see an increase in payments.
    The total estimated reduction in hospital outpatient payments is 
sizeable, but necessary to bring payments for black lung outpatient 
hospital care in line with industry standards. Under current practice, 
hospitals were paid, in aggregate, 431% of their costs for outpatient 
services performed in FY 2014, with payments to individual hospitals 
made at rates as

[[Page 748]]

high as 1,559% of costs.\5\ This divergence explains the need for a new 
payment formula.
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    \5\ Total costs for hospital outpatient services performed in FY 
2014 and paid for by the black lung program are estimated at 
$552,549 by multiplying actual billed reimbursable charges by 
hospital and state outpatient cost-to-charge ratios maintained by 
CMS in their most recent publically available Impact File.
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    While proposed Sec.  725.710 would result in an aggregate decrease 
in the transfer payments from the Trust Fund to hospitals for 
outpatient services, hospitals would continue to be paid at rates they 
are currently accepting from other small third-party payers, including 
the other OWCP programs, and at rates above those paid by Medicare. In 
aggregate, hospitals would be paid approximately 120% of costs for 
outpatient services under the proposed rule.\6\ The Department 
therefore believes that proposed Sec.  725.710 will not affect miners' 
access to care. Moreover, providers being paid significantly above 
costs under the current practice are likely to be most impacted by 
proposed Sec.  725.710. The Department, however, invites comments on 
these determinations. In particular, the Department seeks comments on 
whether any projected impact of the proposal on miners' access to 
outpatient services would be short-term or long-term.
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    \6\ Total costs for hospital outpatient services performed in FY 
2014 that would be paid for by the black lung program under the 
proposed rule are estimated at $552,549 by multiplying projected 
reimbursable charges by hospital and state outpatient cost-to-charge 
ratios maintained by CMS in their most recent publically available 
Impact File.
[GRAPHIC] [TIFF OMITTED] TP04JA17.011

c. Hospital Inpatient Services
    Under proposed Sec.  725.711, the Department would pay for hospital 
inpatient services under an inpatient prospective payment system (IPPS) 
derived from the IPPS utilized by CMS for payment under the Medicare 
program. The Department estimates that under proposed Sec.  725.711, 
there would be a small reduction in payments from the Trust Fund to 
hospitals for inpatient services. Under current practice, the Trust 
Fund paid $12,424,132 for inpatient services rendered in FY 2014. See 
Table 3. The Department estimates that, under proposed Sec.  725.711, 
the Trust Fund would have paid $10,997,900, a decrease of $1,426,232 
(or 11.5%). See Table 3.
    The Department estimates that hospitals in eight states would

[[Page 749]]

experience a net aggregate reduction of $2,301,580 in payments for 
inpatient services under proposed Sec.  725.711. The largest decreases 
in dollar amount would occur in Kentucky ($1,291,411, a decrease of 
26.2%), Virginia ($629,932, a decrease of 25.3%), and Florida 
($205,315, a decrease of 71.9%). See Table 3. Hospitals in nine states 
would experience a net aggregate increase of $875,348 in payment for 
inpatient services under proposed Sec.  725.711. The largest increases 
in dollar amount would occur in Alabama ($623,383, an increase of 
152%), West Virginia ($86,455, an increase of 6.2%), and Pennsylvania 
($79,664, an increase of 5.5%).
    Several factors contribute to these projected changes in payments 
among the states. First, analysis reveals that although the average 
payment per covered inpatient stay would decrease under proposed Sec.  
725.711, the Trust Fund would also pay for almost twice as many 
inpatient stays as under the current system. This change is because the 
DRG methodology focuses on the primary purpose for a hospital stay, 
which would result in more hospital stays being classified as black-
lung-related. By way of illustration, of the 996 inpatient stays that 
hospitals billed the black lung program for in FY 2014, the Trust Fund 
paid the full allowed amount for 427 stays and a portion of the full 
amount for an additional 199 stays. In contrast, under proposed Sec.  
725.711, the Trust Fund would pay for 825 inpatient stays, all paid at 
the full allowed amount.\7\ Relatedly, because the cost of an 
individual inpatient stay may be quite high depending on the treatment 
provided, coverage of any given stay can greatly shift aggregate 
payments. For example, each lung transplant-related hospitalization 
occurring in FY 2014 for which the Trust Fund paid cost hundreds of 
thousands of dollars. Thus, covering or not covering even a single 
inpatient hospitalization can significantly increase or decrease 
aggregate Trust Fund payments. Finally, just as in the outpatient 
context, there is a wide disparity in pay-to-cost ratios among 
individual hospitals, with hospitals being paid up to 971% or more of 
costs under the current system.\8\ The states with the largest payment 
decreases under proposed Sec.  725.711 include hospitals that are 
currently being paid at rates significantly above cost. While proposed 
Sec.  725.711 would result in an aggregate decrease in the transfer 
payments from the Trust Fund to hospitals for inpatient services, 
hospitals would continue to be paid at rates they are accepting from 
other small third-party payers, including the other OWCP programs, and 
at rates above those paid by Medicare. These rates would result in 
hospitals being paid, in aggregate, approximately 155% of costs for 
inpatient services.\9\ The Department therefore believes that proposed 
Sec.  725.711 will not significantly affect hospitals or affect miners' 
access to inpatient hospital care. The Department, however, invites 
comments on these determinations. In particular, the Department seeks 
comments on whether any projected impact of the proposal on miners' 
access to outpatient services would be short-term or long-term.
---------------------------------------------------------------------------

    \7\ The remaining 171 hospital stays billed to the Trust Fund 
were not covered stays (i.e., they are not for the treatment of 
totally disabling pneumoconiosis) and therefore would not be paid 
for by the Trust Fund. In most circumstances, hospitals stays billed 
to, but not paid by, the Trust Fund are paid for by Medicare or 
another insurer.
    \8\ Total costs for hospital inpatient services performed in FY 
2014 and paid for by the black lung program are estimated by 
multiplying actual billed reimbursable charges by hospital and state 
inpatient cost-to-charge ratios maintained by CMS in their most 
recent publically available Impact File.
    \9\ Total costs for hospital inpatient services performed in FY 
2014 that would be paid for by the black lung program under the 
proposed rule are estimated at $7,095,760 by multiplying projected 
reimbursable charges by hospital and state inpatient cost-to-charge 
ratios maintained by CMS in their most recent publically available 
Impact File.

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[[Page 750]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.012

2. Economic Impact Summary
    The Department believes that the proposed rule will not have a 
significant impact on the economy as a whole, and will have only a de 
minimis impact on firms that provide black lung-related health care to 
entitled miners. The Department has used a $100 million dollar annual 
threshold for determining the proposed rule's significance. See, e.g., 
E.O. 12866 (defining regulation that has annual effect on the economy 
of $100 million or more as ``significant''). As shown in Section V.A.1. 
of this preamble, the Department estimates the proposed rule would 
result in an aggregate annual reduction in payments from the Trust Fund 
of $3,154,297 ($8,492 in reduced payments to non-hospital providers, 
$1,719,543 in reduced payments for outpatient hospital services, and 
$1,426,232 in reduced payments for inpatient hospital services). 
Because this aggregate annual reduction in payments is far less than 
$100 million, the Department has determined that the proposed rule will 
not have a significant impact on the economy as a whole.
    Likewise, the Department has determined that the proposed rule will 
have only a de minimis impact at the firm level. See Table 4. To 
determine the firm-level impact of the proposed rule, the Department 
first considered total industry revenues for both non-hospital health 
care services providers and hospitals. Non-hospital providers generated 
$827.9 billion in revenues, according to the U.S. Census Bureau's 
Statistics of U.S. Businesses (SUSB) most recent data for 2012.\10\ 
Dividing annual revenues by the number of firms in the sector in the 
entire U.S. (485,235),\11\ non-hospital providers generated average 
annual revenues of $1.7 million per firm. See Table 4. A total of 1,210 
non-hospital providers rendered services to entitled miners in FY 2014. 
See Table 1. Based on an analysis of the Trust Fund payment data, the 
Department estimates that 420 firms (out of 1,210) would receive net 
reductions in payments from the Trust Fund under the proposed rule.\12\ 
The

[[Page 751]]

Department estimates that the aggregate reduction in payments for these 
420 negatively affected firms would be $373,156. See Table 4. Thus, the 
average reduction in payments to each negatively affected firm would be 
$888 (373,156 divided by 420), or 0.05% (888 divided by 1,700,000) of 
average firm revenue. See Table 4. The Department believes that this 
average reduction is de minimis and would not significantly affect non-
hospital providers.
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    \10\ See https://www.census.gov//econ/susb/data/susb2012.html. 
There is no exact proxy for the non-hospital health care services 
provider category. The Department has used North American Industry 
Classification System (NAICS) code 621(Ambulatory Health Care 
Services) as the proxy for such providers. This category is over 
inclusive because it includes types of providers not used by 
entitled miners. It is, however, the most reasonable proxy because 
91% of non-hospital health care services providers used by such 
miners are part of this category. The Department has performed the 
same analysis shown here at the 4-digit NAICS level and found that 
the conclusion of no significant impact did not change.
    \11\ See https://www.census.gov//econ/susb/data/susb2012.html.
    \12\ As discussed in Section V.A.1. of the preamble, the 
Department estimated the number of providers that could be 
negatively affected by the proposed rule based on the number of 
providers receiving reimbursements from the Trust Fund that would 
see a decrease in the amount of reimbursement using the proposed 
formulas versus current practice. See Table 5 infra for the 
geographic distribution of negatively affected non-hospital 
providers.
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    Hospitals generated $883.1 billion in revenues during 2012.\13\ 
Dividing annual revenues by the number of firms in the sector 
(3,497),\14\ hospital firms generated average annual revenues of $252.5 
million. Based on Trust Fund payment data, OWCP found that a total of 
184 hospital firms provided outpatient services to entitled miners in 
FY 2014. See Table 2. The Department estimates that 177 firms (out of 
184) would receive net reductions in payments from the Trust Fund under 
the proposed rule.\15\ The Department estimates that the aggregate 
reduction in payments for these 177 negatively affected firms would be 
$1,720,182. See Table 4. Thus, the average reduction in payments to 
each negatively affected hospital providing outpatient services would 
be $9,719 (1,720,182 divided by 177), or 0.004% (9,719 divided by 252.5 
million) of average annual revenue for the negatively affected firms. 
See Table 4. The Department believes that this average reduction is de 
minimis and would not significantly affect hospital outpatient services 
providers.
---------------------------------------------------------------------------

    \13\ The Department has used NAICS code 622 (Hospitals) as the 
proxy for providers of both outpatient and inpatient services.
    \14\ See https://www.census.gov//econ/susb/data/susb2012.html.
    \15\ See Section V.A.1. of the preamble and n.11. See Table 6 
infra for the geographic distribution of negatively affected 
outpatient hospital providers.
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    With respect to inpatient hospital services, Trust Fund payment 
data showed that 156 hospitals provided such services to entitled 
miners in FY 2014. See Table 3. The Department estimates that 80 firms 
(out of 156) would receive net reductions in payments from the Trust 
Fund under the proposed rule.\16\ The Department estimates that the 
aggregate reduction in payments for these 80 negatively affected firms 
would be $3,338,650. See Table 4. Thus, the average reduction in 
payments to each negatively affected hospital providing inpatient 
services would be $41,733 (3,338,650 divided by 80), or 0.016% (41,733 
divided by 252.5 million) of average annual revenue. See Table 4. The 
Department believes that this average annual reduction in revenue is de 
minimis and would not significantly affect hospital inpatient services 
providers.
---------------------------------------------------------------------------

    \16\ See Section V.A.1. of the preamble and nn.11 & 14. See 
Table 7 infra for the geographic distribution of negatively affected 
inpatient hospital providers.
---------------------------------------------------------------------------

    Finally, the Department does not believe that any reduction in 
payments from the Trust Fund to firms that provide both outpatient and 
inpatient hospital services would be significant. For example, if 
payments to a particular firm for outpatient services were reduced by 
$9,719 (the average reduction for all providers of outpatient services) 
and payments to the same firm for inpatient services were reduced by 
$41,733 (the average reduction for all providers of inpatient 
services), the combined reduction of $51,452 would represent only 0.2% 
(51,452 divided by 252.5 million) of average firm revenue. Notably, 
some firms that provide both types of services (outpatient and 
inpatient) may experience a reduction in payments for only one type of 
service, while simultaneously experiencing an offsetting increase in 
payments for the other type of service.
    Neither does the Department believe that the rule's impact will 
increase over time. While the total amount of payments by the Trust 
Fund to providers for medical services and treatments may decrease over 
time as the number of entitled miners receiving benefits declines, the 
decrease in payments would result from the decline in the number of 
beneficiaries, not the proposed rule.\17\
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    \17\ For example, in FY 2005, the Trust Fund paid approximately 
$51.2 million to providers for medical services and treatments for 
16,794 entitled miners. By FY 2014, Trust Fund payments had dropped 
to $17.5 million (not adjusted for inflation) for 6,189 entitled 
miners.
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    In sum, the Department believes that the estimated aggregate annual 
reduction in Trust Fund payments of $3,154,297 will not have a 
significant impact on the economy. Similarly, the Department believes 
that the reduction in annual revenue for negatively affected firms 
(0.05% of average annual revenue for non-hospital health care services 
providers, 0.004% of average annual revenue for hospitals providing 
outpatient services, and 0.016% of average annual revenue for hospitals 
providing inpatient services) will not have a significant impact on 
those individual firms.

[[Page 752]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.013

B. Other Considerations

    The Department considered numerous options and methods before 
proposing these payment formulas for the black lung program. The 
Department believes that the proposed formulas and methods best serve 
the interests of all stakeholders. The proposed rule would bring 
medical payments under the black lung program in line with today's 
industry-wide practice, protect the Trust Fund from excessive payments, 
and compensate health care services providers sufficiently to ensure 
that entitled miners have continued access to medical care. Thus, the 
adoption of the payment formulas, as set forth in proposed Sec. Sec.  
725.707-725.711, has multiple advantages.
    In addition, the Department will realize some economies of scale by 
using payment formulas that are similar to those in OWCP's other 
compensation programs. Maintaining a wholly separate system for black 
lung medical bill payments has required increased administration and 
therefore increased costs. It has also led to disparities in provider 
reimbursements. The proposed payment formulas, like other modern 
medical payment methodologies, have built-in cost control mechanisms 
that help prevent inaccurate payments and would therefore preserve 
Trust Fund assets. Also, because the amounts paid under these formulas 
reflect industry standards, recouping medical benefits paid by the 
Trust Fund on an interim basis from liable operators and their 
insurance carriers should be routine. And by migrating to the new 
system, the Department hopes to shorten the time period for 
reimbursements, thus benefitting providers with prompt payment. 
Finally, the proposed rule will benefit claimants, liable operators, 
insurance carriers, medical service providers, and secondary medical 
payers simply by improving the clarity of the black lung medical bill 
payment process.

VI. Regulatory Flexibility Act and Executive Order 13272 (Proper 
Consideration of Small Entities in Agency Rulemaking)

    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601 et seq., 
establishes ``as a principle of regulatory issuance that agencies shall 
endeavor, consistent with the objectives of the rule and of applicable 
statutes, to fit regulatory and informational requirements to the scale 
of the business, organizations, and governmental jurisdictions subject 
to regulation.'' Public Law 96-354. As a result, agencies must 
determine whether a proposed rule may have a ``significant'' economic 
impact on a ``substantial'' number of small entities, including small 
businesses, not-for-profit organizations, and small governmental 
jurisdictions. See 5 U.S.C. 603. If the agency estimates that a 
proposed rule would have a significant impact on a substantial number 
of small entities, then it must prepare a regulatory flexibility 
analysis as described in the RFA. Id. However, if a proposed rule is 
not expected to have a significant impact on a substantial number of 
small entities, the agency may so certify and a regulatory flexibility 
analysis is not required. See 5 U.S.C. 605(b). The certification must 
include a statement providing the factual basis for this determination, 
and the reasoning should be clear.
    The RFA does not define ``significant'' or ``substantial.'' 5 
U.S.C. 601. It is widely accepted, however, that ``[t]he agency is in 
the best position to gauge the small entity impacts of its 
regulations.'' SBA Office of Advocacy, ``A Guide for Government 
Agencies: How to Comply with the Regulatory Flexibility Act,'' at 18 
(May 2012) (``SBA Guide for Government Agencies'').\18\ One measure for 
determining whether an economic impact is ``significant'' is the 
percentage of revenue affected. For this rule, the Department used as a 
standard of significant economic impact whether the costs for a small 
entity equal or exceed 3% of the entity's annual revenue. Similarly, 
one measure for determining whether a ``substantial'' number of small 
entities are affected is the percentage of small entities affected on 
an industry-wide basis. For this rule, the Department has used as a 
standard

[[Page 753]]

to measure a ``substantial number of small entities'' whether 15% or 
more of the small entities in a given industry are significantly 
affected. The regulatory flexibility analysis for this NPRM is based on 
these two measures.\19\
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    \18\ Accessed at http://www.sba.gov/sites/default/files/rfaguide_0512_0.pdf.
    \19\ The Department has used the threshold of 3% of revenues for 
the definition of significant economic impact and the threshold of 
15% for the definition of substantial number of small entities 
affected in a number of recent rulemakings. See, e.g., Wage and Hour 
Division, Establishing a Minimum Wage for Contractors, Notice of 
Proposed Rulemaking, 79 FR 34568, 34603 (June 17, 2014); Office of 
Federal Contract Compliance Programs, Government Contractors, 
Requirement To Report Summary Data on Employee Compensation, Notice 
of Proposed Rulemaking, 79 FR 46562, 46591 (Aug. 8, 2014). The 3% 
and 15% standards are also consistent with the standards utilized by 
various other Federal agencies in conducting their regulatory 
flexibility analyses. See, e.g., Department of Health and Human 
Services Centers for Medicare & Medicaid Services, ``Medicare and 
Medicaid Programs; Regulatory Provisions To Promote Program 
Efficiency, Transparency, and Burden Reduction; Part II; Final 
Rule,'' 79 FR 27106, 27151 (May 12, 2014).
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    Although the proposed rule is not expected to have a significant 
economic impact on a substantial number of small entities, the 
Department has conducted this initial regulatory flexibility analysis 
to aid stakeholders in understanding the impact of the proposed rule on 
small entities and to obtain additional information on such impacts. 
The Department invites interested parties to submit comments on the 
analysis, including the number of small entities affected by the 
proposed rule, the cost estimates, and whether alternatives exist that 
would reduce the burden on small entities. In particular, because the 
Department does not have access to revenue data for affected providers 
(and, thus, based this analysis on nationwide revenue averages), the 
Department is particularly interested in receiving comments regarding 
the proposed rule's potential revenue impact on affected firms.

A. Description of the Reasons That Action by the Agency Is Being 
Considered

    The Department's current regulations specify that payments for 
medical services and treatments must be paid at ``no more than the rate 
prevailing in the community [where the provider is located].'' 20 CFR 
725.706(c). But the rules do not address how that rate should be 
determined. Currently, OWCP applies internally-derived formulas to 
determine payments for services and treatments under the BLBA. The 
current system, however, is difficult to administer and, in some 
instances, may not accurately reflect prevailing community rates. In 
addition, because the current payment formulas do not always reflect 
standard industry practice, the Department has encountered resistance 
from operators and insurance carriers when seeking reimbursement for 
medical benefits initially paid by the Trust Fund on an interim basis 
or when the Department seeks to enforce a final benefit award.

B. Objectives of, and Legal Basis for, the Proposed Rule

    Section 426(a) of the BLBA authorizes the Secretary to ``issue such 
regulations as he deems appropriate to carry out the provisions of this 
title.'' 30 U.S.C. 936(a). The proposed rule adopts formulas for the 
payment of medical services and treatments under the black lung program 
that are derived from those used in the Medicare program and are 
similar to the payment formulas utilized in the other compensation 
programs that OWCP administers. The proposed payment formulas conform 
to current industry practice, and more accurately reflect prevailing 
community rates. The proposed rule, therefore, will help prevent 
inaccurate payments, control health care costs, streamline the 
processing of bills, and provide for similar payment policies and 
practices throughout all OWCP programs.

C. Number of Small Entities Affected

1. Introduction
    The Regulatory Flexibility Act requires an agency to describe and, 
where feasible, estimate the number of small entities to which a 
proposed rule will apply. 5 U.S.C. 603(b)(3). Small entities include 
small businesses, small organizations, and small governmental 
jurisdictions. 5 U.S.C. 601(6). Under the RFA, small organizations are 
defined as not-for-profit, independently owned and operated 
enterprises, that are not dominant in their field. 5 U.S.C. 601(4); see 
also SBA Guide for Government Agencies at 14. To ensure it adequately 
addresses potential impact on small entities, the Department's analysis 
assumes that all not-for-profit entities that provide medical services 
to miners under the BLBA are independently owned and operated, not 
dominant in their field, and thus are small organizations regardless of 
their revenue size.
    The data sources used in the Department's analysis are the Small 
Business Administration (SBA) Table of Small Business Size 
Standards,\20\ the U.S. Census Bureau's Statistics of U.S. Businesses 
(SUSB),\21\ and the U.S. Census Bureau's Economic Census,\22\ which 
provide annual data on the number of firms, employment, and annual 
revenue by industry. The industrial classifications most directly 
affected by this rule are: (1) Ambulatory Health Care Services (North 
American Industry Classification System (NAICS) code 621), which 
includes offices of physicians, outpatient care centers,\23\ medical 
and diagnostic laboratories, and home health care services 
(collectively referred to as ``non-hospital health care services 
providers'' or ``non-hospital providers''); and (2) Hospitals (NAICS 
code 622).
---------------------------------------------------------------------------

    \20\ See http://www.sba.gov/content/small-business-size-standards.
    \21\ See https://www.census.gov/econ/susb/.
    \22\ See http://factfinder.census.gov/.
    \23\ Outpatient care centers are distinct from hospitals that 
provide outpatient services.
---------------------------------------------------------------------------

2. The Department's Analysis
    The Department estimated the number of small businesses of each 
provider type that could be negatively affected by the rule by 
multiplying (a) the percentage of small entities of that provider type 
in the industry as a whole by (b) the estimated number of black lung 
service providers of that type (both small and large entities) that 
could be negatively affected by the rule. The Department estimated the 
number of non-hospital and hospital providers that could be negatively 
affected by the proposed rule by comparing: (a) The amount that the 
Trust Fund actually paid to providers for medical services performed in 
Fiscal Year 2014 (current practice); and (b) the amount the Trust Fund 
would have paid to providers for the same services using the payment 
formulas in the proposed rule. See Section V.A.1. The next two 
subsections provide additional details on how the Department estimated 
the number of small, negatively impacted, non-hospital and hospital 
providers.
a. Non-Hospital Health Care Service Providers
    According to SUSB data, there are 485,235 non-hospital health care 
services providers in the United States. Of that total, 482,584, or 
99.5%, are classified as small businesses by the SBA (this includes 
both for-profit and not-for-profit businesses).\24\ Of the remaining 
2,651 non-hospital providers that are not classified as small under the 
SBA definition, 1.7%--or 45 (2,651 x 0.17)--are classified as not-for-
profit by the Economic Census, and thus considered small organizations 
(i.e., any not-for-profit entity that is independently owned and 
operated and

[[Page 754]]

not dominant in its field). In total, the Department estimates that 
482,629 non-hospital providers (482,584 classified as small under SBA 
revenue criteria, plus 45 additional not-for-profit providers) are 
small entities for purposes of the RFA. Thus, 99.5%, (482,629 divided 
by 485,235) of all non-hospital providers in the United States are 
classified as small entities within the meaning of the RFA.
---------------------------------------------------------------------------

    \24\ The SBA's small business size standards for subsectors 
within the ambulatory health care services industry range from $7.5 
million to $38.5 million.
---------------------------------------------------------------------------

    To determine the number of small non-hospital providers that could 
be negatively impacted by the proposed rule, the Department multiplied 
the overall, industry-wide percentage of small, non-hospital providers 
(99.5%) by the number of non-hospital providers (both small and large) 
that the Department estimates could be negatively affected by the rule 
(420). See Table 5. That multiplication yielded an estimate that 418 
small, non-hospital providers could be negatively affected by the rule. 
Table 5 provides information on all negatively impacted non-hospital 
providers, small and large, on a state-by-state basis.

[[Page 755]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.014


[[Page 756]]


b. Hospitals
    According to SUSB data, there are 3,497 hospitals in the United 
States. Of that total, 1,547, or 44.2%, are classified as small 
businesses by the SBA (this includes both for-profit and not-for-profit 
businesses).\25\ Of the remaining 1,950 hospitals that are not 
classified as small under the SBA definition, 87.9%--or 1,714 (1,950 x 
0.879)--are classified as not-for-profit by the Economic Census, and 
thus considered small organizations (i.e. any not-for-profit entity 
that is independently owned and operated and not dominant in its 
field). In total, the Department estimates that 3,261 hospitals (1,547 
classified as small under SBA revenue criteria, plus 1,714 additional 
not-for-profit hospitals) are small entities for purposes of the RFA. 
Thus, 93.3%, (3,261 divided by 3,497) of all hospitals in the United 
States are classified as small entities within the meaning of the RFA.
---------------------------------------------------------------------------

    \25\ SBA defines a hospital provider as small if it has $38.5 
million or less in annual revenue.
---------------------------------------------------------------------------

    To determine the number of small hospitals that could be negatively 
impacted by the proposed rule, the Department multiplied the overall, 
industry-wide percentage of small hospitals (93.3%) by the number of 
hospitals (both small and large) that the Department estimates could be 
negatively affected by the rule.
    The Department performed the above-described analysis separately 
for: (a) Hospitals providing outpatient services to entitled black lung 
patients; and (b) hospitals providing inpatient services to entitled 
black lung patients. Specifically, for outpatient providers, the 
Department estimated that a total of 177 hospitals could be negatively 
affected by the proposed rule and that, of that total, 165 (or 93.3%) 
are small hospitals. See Table 2, Table 6. Similarly, for inpatient 
providers, the Department estimated that a total of 80 hospitals could 
be negatively affected by the proposed rule and that, of that total, 75 
(or 93.3%) are small hospitals.
    Tables 6 and 7 provide information on all negatively impacted 
hospitals, small and large, on a state-by-state basis, addressing, 
respectively, hospitals providing outpatient services to black lung 
patients and hospitals providing inpatient services to black lung 
patients.

[[Page 757]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.015


[[Page 758]]


[GRAPHIC] [TIFF OMITTED] TP04JA17.016

D. Costs to Small Entities Affected

    The Department estimates that the proposed rule will not result in 
a significant impact (defined as 3% or more of annual revenue) on a 
substantial number of small entities (defined as 15% or more of all 
negatively affected small entities in the relevant industry). The 
relevant industries are defined as non-hospital health care services 
providers and hospitals. The Department has determined that the 
proposed rule will not impose any additional reporting, recordkeeping, 
or other compliance costs on affected entities. With respect to the 
reduction in payments from the Trust Fund, the Department estimates 
that no small entities providing non-hospital health care services will 
experience a significant impact (a loss of 3% or more of annual 
revenues). As for hospitals, the Department estimates that hospitals 
with revenues/receipts between $100,000 and $499,900 providing 
outpatient services and hospitals with revenues/receipts between 
$100,000 and $999,999 providing inpatient services would experience a 
significant impact. Assuming that the affected hospitals exhibit the 
same revenue distribution as firms nationally, the Department estimates 
that only one small firm providing outpatient services and two small 
firms providing inpatient services will be significantly impacted. 
These entities do not constitute a substantial number (15% or more) of 
the total number of negatively affected small hospitals providing 
either outpatient or inpatient services.
1. Estimated Reporting, Recordkeeping, and Other Compliance Costs to 
Small Entities
    Based on its analysis of available data, the Department has 
determined that the proposed rule will not impose any additional 
reporting, recordkeeping, or

[[Page 759]]

other compliance costs on providers. The proposed procedures for the 
submission and payment of medical bills conform to current industry 
standards for the processing of such bills. Providers are familiar with 
the proposed procedures and already have adequate billing systems in 
place for use in connection with other programs such as Medicare. 
Moreover, a number of provisions in the proposed rule simply codify 
current practice. Thus, the Department has determined that the proposed 
rule would not impose any additional reporting, recordkeeping, or 
compliance costs on providers, regardless of firm size.
2. Estimated Costs to Small Entities From Changes in Payments by the 
Trust Fund
    In order to determine whether the proposed rule would result in a 
significant impact on any small businesses, the Department first 
estimated the revenues for negatively affected small entities of each 
provider type (non-hospital and hospital service providers) and then 
determined whether the estimated impact on those firms was significant. 
See Section V.A.2. The Department does not have individual revenue data 
for black lung service providers, but does have SBA data on the 
distribution of firms across the industry by revenue size. The 
Department therefore estimated the number of small negatively affected 
firms of each provider type in different revenue/receipts bands, by 
multiplying the industry-distribution percentage of firms in those 
revenue/receipts bands by the number of negatively affected black lung 
providers of that type, accounting for the fact that all not-for-profit 
providers are classified as small entities. See Tables 8-10. The 
Department then determined whether the estimated cost to each firm, as 
calculated in Section V.A.2. of this preamble, was significant (a 
reduction in average annual revenue of 3% or more) to a firm in that 
revenue band. The Department determined that only 3 of the 658 
negatively affected black lung providers in all provider categories 
were significantly impacted. See Tables 8-10, Table 11. The Department 
finally calculated whether the number of small providers of each type 
that would experience a significant impact as a result of the proposed 
rule represented a substantial percentage (15% or more) of all 
negatively affected small entities of that type, and determined that 
they did not. See Tables 8-10, Table 11.
a. Non-Hospital Health Care Services Providers
    As discussed earlier, the Department estimates that 420 non-
hospital health care services providers would experience a reduction in 
payments from the Trust Fund as a result of the proposed rule, and that 
418 of these are estimated to be small entities. See VI.C.2.a., Table 
4, Table 8, Table 11. Also, the Department estimates the annual cost of 
the proposed rule will be $888 for each negatively affected non-
hospital health care services provider. See Section V.A.2., Table 4, 
Table 8, Table 11. The Department divided the estimated annual cost of 
the proposed rule to non-hospital health care services providers by the 
average revenue in each revenue band to estimate the average percentage 
of revenue lost by these providers. See Table 8. The Department 
acknowledges that uniformly applying the annual cost of the proposed 
rule across all negatively affected entities is an analytical 
assumption that likely does not reflect the true distribution of the 
costs of this proposed rule. However, OWCP does not have the data to 
develop a more accurate distribution of costs and believes that this 
proportional distribution likely overestimates the costs to the 
smallest providers. The costs of this proposed rule are small relative 
to the revenue and receipts of most providers and the impact of these 
costs might be hidden were OWCP to more heavily weight the distribution 
of costs towards larger firms. The Department believes this 
proportional distribution allows OWCP to focus this analysis on the 
impact on the smallest providers even though these impacts may be 
overstated. Based on these calculations, the Department does not 
believe that any of the negatively affected small entities providing 
non-hospital health care services will experience a significant impact 
(i.e., a loss of 3% or more of annual revenue) from the proposed rule. 
See Table 8, Table 11. For example, even in the lowest revenue band 
(less than $100,000 in annual revenue), the average annual revenue 
reduction resulting from the proposed rule would be only 1.77% ($888 
divided by $50,173). See Table 8. The number of small non-hospital 
health care services providers that would experience a significant 
impact (zero) is plainly not a significant percentage (15% or more) of 
all such negatively affected small entities.

[[Page 760]]

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[[Page 761]]


b. Hospital Outpatient Service Providers
    The Department estimates that 177 hospitals that provide outpatient 
services to entitled miners would experience a reduction in payments 
from the Trust Fund as a result of the proposed rule, and that 168 of 
these hospitals are small. See VI.C.2.b., Table 4, Table 9, Table 11. 
Also, the Department estimates the annual cost of the proposed rule 
will be $9,719 for each negatively affected hospital outpatient 
services provider.\26\ See V.A.2., Table 4, Table 11. The Department 
divided the estimated annual cost of the proposed rule for negatively 
affected hospital outpatient services providers by the average revenue 
in each revenue band to estimate the average percentage of revenue lost 
by these providers. See Table 9. Based on these calculations, the 
Department estimates that only one provider (in the $100,000-$499,000 
revenue band) will experience a significant impact from the proposed 
rule. See Table 9. The Department estimates that this firm would 
experience a reduction in revenue of 3.73% ($9,719 divided by 
$260,292). See Table 9. Because this single entity represents only 0.6% 
(1 divided by 165) of all negatively affected small outpatient service 
entities, however, the proposed rule will not have a significant effect 
on a substantial number (15% or more) of all negatively affected small 
hospital outpatient service providers. See Table 11.
---------------------------------------------------------------------------

    \26\ As previously noted, the Department acknowledges that 
uniformly applying the annual cost of the proposed rule across all 
negatively affected entities likely overstates the impact on smaller 
providers. See Section VI.D.2.a. of the preamble.
---------------------------------------------------------------------------

    Because revenue data for entities in the $0-100,000 revenue band is 
not available, see Table 9, the Department was unable to calculate 
whether the impact of the proposed rule on providers in that revenue 
band would be significant. Nonetheless, even assuming that the only 
negatively impacted entity in the $0-$100,000 revenue band also 
experienced a significant impact, only 1.2% (2 divided by 165) of 
negatively affected small entities would experience a significant 
impact. This impact is still less than the 15% threshold for 
determining whether a substantial number of all negatively affected 
small entities would experience a significant impact.

[[Page 762]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.018


[[Page 763]]


c. Hospital Inpatient Services Providers
    Finally, the Department estimates that 80 hospitals that provide 
inpatient services to entitled miners would experience an annual 
reduction in payments from the Trust Fund as a result of the proposed 
rule, and that 35 of these are small entities. See VI.C.2.b., Table 4, 
Table 10, Table 11. Also, the Department estimates the annual cost of 
the proposed rule will be $41,733 for each negatively affected hospital 
inpatient services provider. \27\ See V.A.2., Tables 4, Table 11. The 
Department divided the estimated annual cost of the proposed rule on 
each negatively affected hospital inpatient services provider by the 
average revenue in each revenue band to estimate the average percentage 
of revenue lost by these providers. See Table 10. Based on these 
calculations, the Department estimates that only two entities (one in 
the $100,000-$499,999 revenue band and one in the $500,000-$999,999 
revenue band) will experience a significant impact (greater than 3% of 
annual revenue) from the proposed rule. See Table 10. Because these two 
entities represent only 2.6% (2 divided by 75) of all negatively 
affected entities, however, the proposed rule will not a have 
significant effect on a substantial number (15% or more) of all 
negatively affected hospital inpatient services providers. See Table 
11.
---------------------------------------------------------------------------

    \27\ As previously noted, the Department acknowledges that 
uniformly applying the annual cost of the proposed rule across all 
negatively affected entities likely overstates the impact on smaller 
providers. See Section VI.D.2.a. of the preamble; n.34.
---------------------------------------------------------------------------

    Because revenue data for entities in the $0-100,000 revenue band 
are not available, see Table 10, the Department was unable to calculate 
whether the impact of the proposed rule on providers in that revenue 
band would be significant. Assuming that the only negatively impacted 
entity in the $0-$100,000 revenue band also experienced a significant 
impact, only 4.0% (3 divided by 75) of all negatively affected small 
entities would experience a significant impact. This impact is still 
less than the 15% threshold for determining whether a substantial 
number of negatively affected small entities would experience a 
significant impact.

[[Page 764]]

[GRAPHIC] [TIFF OMITTED] TP04JA17.019


[[Page 765]]



E. Summary

    In summary, the Department estimates that the proposed rule will 
not have a significant impact on any small entity providing non-
hospital health care services. In addition, it will have a significant 
impact on only one small hospital entity providing outpatient services 
and two providing inpatient services. For each category of provider, 
the percentage of small entities experiencing a significant impact 
(loss of 3% or more of annual revenue) from the proposed rule (0% for 
professional medical services, 0.6% for outpatient hospital services, 
and 2.6% for inpatient hospital services) does not represent a 
substantial number (15% or more) of all negatively affected small 
entities in that category.
    Moreover, the Department's calculations likely overestimate the 
impact of the proposed rule on negatively affected small entities. The 
per-provider loss calculations are based on an average of all entities 
in each category, regardless of size. The Department presumes that 
larger entities--i.e., those with revenue exceeding the SBA's 
thresholds--treat more entitled miners, and thus receive larger total 
payments from the Trust Fund than smaller entities. Thus, the actual 
per-provider cost for small entities in each provider category likely 
will be smaller than the estimates used by the Department in this 
analysis. To ensure adequate consideration of the impact on small 
entities, however, the Department used these unlikely, category-wide 
average cost estimates to determine whether the rule would have a 
significant economic impact on a substantial number of small entities.
[GRAPHIC] [TIFF OMITTED] TP04JA17.020

F. Identification of Relevant Federal Rules That May Duplicate, 
Overlap, or Conflict With the Proposed Rule

    The Department is unaware of any rules that may duplicate, overlap, 
or conflict with the proposed rule.

G. Description of Any Significant Alternatives to the Proposed Rule 
That Accomplish the Stated Objectives of Applicable Statutes and That 
Minimize Any Significant Impact of the Proposed Rule on Small Entities

    The RFA requires the Department to consider alternatives to the 
proposed rule that would minimize any significant economic impact on 
small entities without sacrificing the stated objectives of the 
applicable statute. There is no basis in the statute for exempting 
small firms from payment rules or for providing different payment rules 
for small versus large firms. Moreover, providing different rules would 
defeat the proposed rule's stated objective: To employ modern payment 
methods and streamline the payment process, while protecting the 
limited resources of the Trust Fund.

H. Comments To Assist the Regulatory Flexibility Analysis

    Although the Department estimates that the proposed rule would not 
have a significant economic impact (more than 3% of revenue) on a 
substantial number of small entities (more than 15% in the industry), 
the Department would appreciate feedback on the data, factors, and 
assumptions used in its analysis. Accordingly, the Department invites 
all interested parties to submit comments regarding the costs and 
benefits of the proposed rule, with particular attention to the effects 
of the rule on small entities.

VII. Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531 
et seq., directs agencies to assess the effects of Federal Regulatory 
Actions on State, local, and tribal governments, and the private 
sector, ``other than to the extent that such regulations incorporate 
requirements specifically set forth in law.'' 2 U.S.C. 1531. For 
purposes of the Unfunded Mandates Reform Act, this rule does not 
include any Federal mandate that may result in increased expenditures 
by State, local, tribal governments, or increased expenditures

[[Page 766]]

by the private sector of more than $100,000,000.

VIII. Executive Order 13132 (Federalism)

    The Department has reviewed this proposed rule in accordance with 
Executive Order 13132 regarding federalism, and has determined that it 
does not have ``federalism implications.'' E.O. 13132, 64 FR 43255 
(Aug. 4, 1999). The proposed rule will not ``have substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government'' if 
promulgated as a final rule. Id.

IX. Executive Order 12988 (Civil Justice Reform)

    The proposed rule meets the applicable standards in Sections 3(a) 
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden.

X. Congressional Review Act

    The proposed rule is not a ``major rule'' as defined in the 
Congressional Review Act, 5 U.S.C. 801 et seq. If promulgated as a 
final rule, this rule will not result in: An annual effect on the 
economy of $100,000,000 or more; a major increase in costs or prices 
for consumers, individual industries, Federal, State or local 
government agencies, or geographic regions; or significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based enterprises to 
compete with foreign-based enterprises in domestic and export markets.

List of Subjects in 20 CFR Part 725

    Administrative practice and procedure, Black lung benefits, Claims, 
Coal miners' entitlement to benefits, Health care, Reporting and 
recordkeeping requirements, Survivors' entitlement to benefits, Total 
disability due to pneumoconiosis, Vocational rehabilitation, Workers' 
compensation.

    For the reasons set forth in the preamble, the Department of Labor 
proposes to amend 20 CFR part 725 as follows:

PART 725--CLAIMS FOR BENEFITS UNDER PART C OF TITLE IV OF THE 
FEDERAL MINE SAFETY AND HEALTH ACT, AS AMENDED

0
1. The authority citation for part 725 continues to read as follows:

    Authority:  5 U.S.C. 301; 28 U.S.C. 2461 note (Federal Civil 
Penalties Inflation Adjustment Act of 1990); Pub. L. 114-74 at sec. 
701; Reorganization Plan No. 6 of 1950, 15 FR 3174; 30 U.S.C. 901 et 
seq., 902(f), 921, 932, 936; 33 U.S.C. 901 et seq.; 42 U.S.C. 405; 
Secretary's Order 10-2009, 74 FR 58834.

0
2. Amend Sec.  725.308 as follows:
0
a. Remove paragraph (b);
0
b. Redesignate paragraph (c) as paragraph (b);
0
c. Remove from the second sentence in paragraph (c) ``However, except 
as provided in paragraph (b) of this section,''.
0
3. In part 725, revise subpart J as follows:
Subpart J--Medical Benefits and Vocational Rehabilitation
Sec.
725.701 What medical benefits are available?
725.702 Who is considered a physician?
725.703 How is treatment authorized?
725.704 How are arrangements for medical care made?
725.705 Is prior authorization for medical services required?
725.706 What reports must a medical provider give to OWCP?
725.707 At what rate will fees for medical services and treatments 
be paid?
725.708 How are payments for professional medical services and 
medical equipment determined?
725.709 How are payments for prescription drugs determined?
725.710 How are payments for outpatient medical services determined?
725.711 How are payments for inpatient medical services determined?
725.712 When and how are fees reduced?
725.713 If a fee is reduced, may a provider bill the claimant for 
the balance?
725.714 How do providers enroll with OWCP for authorizations and 
billing?
725.715 How do providers submit medical bills?
725.716 How should a miner prepare and submit requests for 
reimbursement for covered medical expenses and transportation costs?
725.717 What are the time limitations for requesting payment or 
reimbursement for medical services or treatments?
725.718 How are disputes concerning medical benefits resolved?
725.719 What is the objective of vocational rehabilitation?
725.720 How does a miner request vocational rehabilitation 
assistance?

Subpart J--Medical Benefits and Vocational Rehabilitation


Sec.  725.701   What medical benefits are available?

    (a) A miner who is determined to be eligible for benefits under 
this part or part 727 of this subchapter (see Sec.  725.4(d)) is 
entitled to medical benefits as set forth in this subpart as of the 
date of his or her claim, but in no event before January 1, 1974. 
Medical benefits may not be provided to the survivor or dependent of a 
miner under this part.
    (b) A responsible operator, or where there is none, the fund, must 
furnish a miner entitled to benefits under this part with such medical 
services and treatments (including professional medical services and 
medical equipment, prescription drugs, outpatient medical services, 
inpatient medical services, and any other medical service, treatment or 
supply) for such periods as the nature of the miner's pneumoconiosis 
and disability requires.
    (c) The medical benefits referred to in paragraphs (a) and (b) of 
this section include palliative measures useful only to prevent pain or 
discomfort associated with the miner's pneumoconiosis or attendant 
disability.
    (d) An operator or the fund must also pay the miner's reasonable 
cost of travel necessary for medical treatment (to be determined in 
accordance with prevailing United States government mileage rates) and 
the reasonable documented cost to the miner or medical provider 
incurred in communicating with the operator, carrier, or OWCP on 
matters connected with medical benefits.
    (e)(1) If a miner receives a medical service or treatment, as 
described in this section, for any pulmonary disorder, there will be a 
rebuttable presumption that the disorder is caused or aggravated by the 
miner's pneumoconiosis.
    (2) The party liable for the payment of benefits may rebut the 
presumption by producing credible evidence that the medical service or 
treatment provided was for a pulmonary disorder apart from those 
previously associated with the miner's disability, or was beyond that 
necessary to effectively treat a covered disorder, or was not for a 
pulmonary disorder at all.
    (3) An operator or the fund, however, cannot rely on evidence that 
the miner does not have pneumoconiosis or is not totally disabled by 
pneumoconiosis arising out of coal mine employment to defeat a request 
for coverage of any medical service or treatment under this subpart.
    (4) In determining whether the treatment is compensable, the 
opinion of the miner's treating physician may be entitled to 
controlling weight pursuant to Sec.  718.104(d).
    (5) A finding that a medical service or treatment is not covered 
under this subpart will not otherwise affect the miner's entitlement to 
benefits.

[[Page 767]]

Sec.  725.702   Who is considered a physician?

    The term ``physician'' includes only doctors of medicine (MD) and 
doctors of osteopathy (DO) within the scope of their practices as 
defined by State law. No treatment or medical services performed by any 
other practitioner of the healing arts is authorized by this part, 
unless such treatment or service is authorized and supervised both by a 
physician as defined in this section and by OWCP.


Sec.  725.703   How is treatment authorized?

    (a) Upon notification to a miner of such miner's entitlement to 
benefits, OWCP must provide the miner with a list of authorized 
treating physicians and medical facilities in the area of the miner's 
residence. The miner may select a physician from this list or may 
select another physician with approval of OWCP. Where emergency 
services are necessary and appropriate, authorization by OWCP is not 
required.
    (b) OWCP may, on its own initiative, or at the request of a 
responsible operator, order a change of physicians or facilities, but 
only where it has been determined that the change is desirable or 
necessary in the best interest of the miner. The miner may change 
physicians or facilities subject to the approval of OWCP.
    (c) If adequate treatment cannot be obtained in the area of the 
claimant's residence, OWCP may authorize the use of physicians or 
medical facilities outside such area as well as reimbursement for 
travel expenses and overnight accommodations.


Sec.  725.704   How are arrangements for medical care made?

    (a) Operator liability. If an operator has been determined liable 
for the payment of benefits to a miner, OWCP will notify the operator 
or its insurance carrier of the names, addresses, and telephone numbers 
of the authorized providers of medical benefits chosen by an entitled 
miner, and require the operator or carrier to:
    (1) Notify the miner and the providers chosen that the operator or 
carrier will be responsible for the cost of medical services provided 
to the miner on account of the miner's total disability due to 
pneumoconiosis;
    (2) Designate a person or persons with decision-making authority 
with whom OWCP, the miner and authorized providers may communicate on 
matters involving medical benefits provided under this subpart and 
notify OWCP, the miner and providers of this designation;
    (3) Make arrangements for the direct reimbursement of providers for 
their services.
    (b) Fund liability. If there is no operator found liable for the 
payment of benefits, OWCP will make necessary arrangements to provide 
medical care to the miner, notify the miner and providers selected of 
the liability of the fund, designate a person or persons with whom the 
miner or provider may communicate on matters relating to medical care, 
and make arrangements for the direct reimbursement of the medical 
provider.


Sec.  725.705   Is prior authorization for medical services required?

    (a) Except as provided in paragraph (b) of this section, medical 
services from an authorized provider which are payable under Sec.  
725.701 do not require prior approval of OWCP or the responsible 
operator.
    (b) Except where emergency treatment is required, prior approval of 
OWCP or the responsible operator must be obtained before any 
hospitalization or surgery, or before ordering medical equipment where 
the purchase price exceeds $300. A request for approval of non-
emergency hospitalization or surgery must be acted upon expeditiously, 
and approval or disapproval will be given by telephone if a written 
response cannot be given within 7 days following the request. No 
employee of the Department of Labor, other than a district director or 
the Chief, Medical Audit and Operations Section, DCMWC, is authorized 
to approve a request for hospitalization or surgery by telephone.


Sec.  725.706   What reports must a medical provider give to OWCP?

    (a) Within 30 days following the first medical or surgical 
treatment provided under Sec.  725.701, the provider must furnish to 
OWCP and the responsible operator or its insurance carrier, if any, a 
report of such treatment.
    (b) In order to permit continuing supervision of the medical care 
provided to the miner with respect to the necessity, character and 
sufficiency of any medical care furnished or to be furnished, the 
provider, operator or carrier must submit such reports in addition to 
those required by paragraph (a) of this section as OWCP may from time 
to time require. Within the discretion of OWCP, payment may be refused 
to any medical provider who fails to submit any report required by this 
section.


Sec.  725.707   At what rate will fees for medical services and 
treatments be paid?

    (a) All fees charged by providers for any medical service, 
treatment, drug or equipment authorized under this subpart will be paid 
at no more than the rate prevailing for the service, treatment, drug or 
equipment in the community in which the provider is located.
    (b) When medical benefits are paid by the fund at OWCP's direction, 
either on an interim basis or because there is no liable operator, the 
prevailing community rate for various types of service will be 
determined as provided in Sec. Sec.  725.708-725.711.
    (c) The provisions of Sec. Sec.  725.708-725.711 do not apply to 
charges for medical services or treatments furnished by medical 
facilities of the U.S. Public Health Service or the Departments of the 
Army, Navy, Air Force and Veterans Affairs.
    (d) If the provisions of Sec. Sec.  725.708-725.711 cannot be used 
to determine the prevailing community rate for a particular service or 
treatment or for a particular provider, OWCP may determine the 
prevailing community rate by reliance on other federal or state payment 
formulas or on other evidence, as appropriate.
    (e) OWCP must review the payment formulas described in Sec. Sec.  
725.708-725.711 at least once a year, and may adjust, revise or replace 
any payment formula or its components when necessary or appropriate.
    (f) The provisions of Sec. Sec.  725.707-725.711 apply to all 
medical services or treatments rendered on or after the effective date 
of this rule.


Sec.  725.708   How are payments for professional medical services and 
medical equipment determined?

    (a)(1) OWCP pays for professional medical services based on a fee 
schedule derived from the schedule maintained by the Centers for 
Medicare & Medicaid Services (CMS) for the payment of such services 
under the Medicare program (42 CFR part 414). The schedule OWCP 
utilizes consists of: An assignment of Relative Value Units (RVU) to 
procedures identified by Healthcare Common Procedure Coding System/
Current Procedural Terminology (HCPCS/CPT) code, which represents the 
work (relative time and intensity of the service), the practice expense 
and the malpractice expense, as compared to other procedures of the 
same general class; an assignment of Geographic Practice Cost Index 
(GPCI) values, which represent the relative work, practice expense and 
malpractice expense relative to other localities throughout the 
country; and a monetary

[[Page 768]]

value assignment (conversion factor) for one unit of value for each 
coded service.
    (2) The maximum payment for professional medical services 
identified by a HCPCS/CPT code is calculated by multiplying the RVU 
values for the service by the GPCI values for such service in that area 
and multiplying the sum of these values by the conversion factor to 
arrive at a dollar amount assigned to one unit in that category of 
service.
    (3) OWCP utilizes the RVUs published, and updated or revised from 
time to time, by CMS for all services for which CMS has made 
assignments. Where there are no RVUs assigned, OWCP may develop and 
assign any RVUs that OWCP considers appropriate. OWCP utilizes the GPCI 
for the locality as defined by CMS and as updated or revised by CMS 
from time to time. OWCP will devise conversion factors for professional 
medical services using OWCP's processing experience and internal data.
    (b) Where a professional medical service is not covered by the fee 
schedule described in paragraph (a) of this section, OWCP may pay for 
the service based on other fee schedules or pricing formulas utilized 
by OWCP for professional medical services.
    (c) OWCP pays for medical equipment identified by a HCPCS/CPT code 
based on fee schedules or other pricing formulas utilized by OWCP for 
such equipment.


Sec.  725.709   How are payments for prescription drugs determined?

    (a)(1) OWCP pays for drugs prescribed by physicians by multiplying 
a percentage of the average wholesale price, or other baseline price as 
specified by OWCP, of the medication by the quantity or amount 
provided, plus a dispensing fee.
    (2) All prescription medications identified by National Drug Code 
are assigned an average wholesale price representing the product's 
nationally recognized wholesale price as determined by surveys of 
manufacturers and wholesalers, or another baseline price designated by 
OWCP.
    (3) OWCP may establish the dispensing fee.
    (b) If the pricing formula described in paragraph (a) of this 
section is inapplicable, OWCP may make payment based on other pricing 
formulas utilized by OWCP for prescription medications.
    (c) OWCP may, in its discretion, contract for or require the use of 
specific providers for certain medications. OWCP also may require the 
use of generic equivalents of prescribed medications where they are 
available.


Sec.  725.710   How are payments for outpatient medical services 
determined?

    (a)(1) Except as provided in paragraphs (b) and (c) of this 
section, OWCP pays for outpatient medical services according to 
Ambulatory Payment Classifications (APCs) derived from the Outpatient 
Prospective Payment System (OPPS) devised by the Centers for Medicare & 
Medicaid Services (CMS) for the Medicare program (42 CFR part 419).
    (2) For outpatient medical services paid under the OPPS, such 
services are assigned according to the APC prescribed by CMS for that 
service. Each payment is derived by multiplying the prospectively 
established scaled relative weight for the service's clinical APC by a 
conversion factor to arrive at a national unadjusted payment rate for 
the APC. The labor portion of the national unadjusted payment rate is 
further adjusted by the hospital wage index for the area where payment 
is being made. Additional adjustments are also made as required or 
needed.
    (b) If a compensable service cannot be assigned or paid at the 
prevailing community rate under the OPPS, OWCP may pay for the service 
based on fee schedules or other pricing formulas utilized by OWCP for 
outpatient services.
    (c) This section does not apply to services provided by ambulatory 
surgical centers.


Sec.  725.711   How are payments for inpatient medical services 
determined?

    (a)(1) OWCP pays for inpatient medical services according to pre-
determined rates derived from the Medicare Inpatient Prospective 
Payment System (IPPS) used by the Centers for Medicare & Medicaid 
Services (CMS) for the Medicare program (42 CFR part 412).
    (2) Inpatient hospital discharges are classified into diagnosis-
related groups (DRGs). Each DRG groups together clinically similar 
conditions that require comparable amounts of inpatient resources. For 
each DRG, an appropriate weighting factor is assigned that reflects the 
estimated relative cost of hospital resources used with respect to 
discharges classified within that group compared to discharges 
classified within other groups.
    (3) For each hospital discharge classified within a DRG, a payment 
amount for that discharge is determined by using the national weighting 
factor determined for that DRG, national standardized adjustments, and 
other factors which may vary by hospital, such as an adjustment for 
area wage levels. OWCP may also use other price adjustment factors as 
appropriate based on its processing experience and internal data.
    (b) If an inpatient service cannot be classified by DRG, occurs at 
a facility excluded from the Medicare IPPS, or otherwise cannot be paid 
at the prevailing community rate under the pricing formula described in 
paragraph (a) of this section, OWCP may pay for the service based on 
fee schedules or other pricing formulas utilized by OWCP for inpatient 
services.


Sec.  725.712   When and how are fees reduced?

    (a) A provider's designation of the code used to identify a billed 
service or treatment will be accepted if the code is consistent with 
the medical and other evidence, and the provider will be paid no more 
than the maximum allowable fee for that service or treatment. If the 
code is not consistent with the medical evidence or where no code is 
supplied, the bill will be returned to the provider for correction and 
resubmission or denied.
    (b) If the charge submitted for a service or treatment supplied to 
a miner exceeds the maximum amount determined to be reasonable under 
this subpart, OWCP must pay the amount allowed by Sec. Sec.  725.707-
725.711 for that service and notify the provider in writing that 
payment was reduced for that service in accordance with those 
provisions.
    (c) A provider or other party who disagrees with a fee 
determination may seek review of that determination as provided in this 
subpart (see Sec.  725.718).


Sec.  725.713   If a fee is reduced, may a provider bill the claimant 
for the balance?

    A provider whose fee for service is partially paid by OWCP as a 
result of the application of the provisions of Sec. Sec.  725.707-
725.711 or otherwise in accordance with this subpart may not request 
reimbursement from the miner for additional amounts.


Sec.  725.714   How do providers enroll with OWCP for authorizations 
and billing?

    (a) All non-pharmacy providers seeking payment from the fund must 
enroll with OWCP or its designated bill processing agent to have access 
to the automated authorization system and to submit medical bills to 
OWCP.
    (b) To enroll, the non-pharmacy provider must complete and submit a 
Form OWCP-1168 to the appropriate location noted on that form. By 
completing and submitting this form, providers certify that they 
satisfy all applicable Federal and State licensure and regulatory 
requirements that apply

[[Page 769]]

to their specific provider or supplier type.
    (c) The non-pharmacy provider must maintain documentary evidence 
indicating that it satisfies those requirements.
    (d) The non-pharmacy provider must also notify OWCP immediately if 
any information provided to OWCP in the enrollment process changes.
    (e) All pharmacy providers must obtain a National Council for 
Prescription Drug Programs number. Upon obtaining such number, they are 
automatically enrolled in OWCP's pharmacy billing system.
    (f) After enrollment, a provider must submit all medical bills to 
OWCP through its bill processing portal or to the OWCP address 
specified for such purpose and must include the Provider Number/ID 
obtained through enrollment, or its National Provider Number (NPI) or 
any other identifying numbers required by OWCP.


Sec.  725.715   How do providers submit medical bills?

    (a) A provider must itemize charges on Form OWCP-1500 or CMS-1500 
(for professional services, equipment or drugs dispensed in the 
office), Form OWCP-04 or UB-04 (for hospitals), an electronic or paper-
based bill that includes required data elements (for pharmacies) or 
other form as designated by OWCP, and submit the form promptly to OWCP.
    (b) The provider must identify each medical service performed using 
the Current Procedural Terminology (CPT) code, the Healthcare Common 
Procedure Coding System (HCPCS) code, the National Drug Code (NDC) 
number, or the Revenue Center Code (RCC), as appropriate to the type of 
service. OWCP has discretion to determine which of these codes may be 
utilized in the billing process. OWCP also has the authority to create 
and supply codes for specific services or treatments. These OWCP-
created codes will be issued to providers by OWCP as appropriate and 
may only be used as authorized by OWCP. A provider may not use an OWCP-
created code for other types of medical examinations, services or 
treatments. (1) For professional medical services, the provider must 
list each diagnosed condition in order of priority and furnish the 
corresponding diagnostic code using the ``International Classification 
of Disease, 10th Edition, Clinical Modification'' (ICD-10-CM), or as 
revised.
    (2) For prescription drugs or supplies, the provider must include 
the NDC assigned to the product, and such other information as OWCP may 
require.
    (3) For outpatient medical services, the provider must use HCPCS 
codes and other coding schemes in accordance with the Outpatient 
Prospective Payment System.
    (4) For inpatient medical services, the provider must include 
admission and discharge summaries and an itemized statement of the 
charges.
    (c)(1) By submitting a bill or accepting payment, the provider 
signifies that the service for which reimbursement is sought was 
performed as described, necessary, appropriate, and properly billed in 
accordance with accepted industry standards. For example, accepted 
industry standards preclude upcoding billed services for extended 
medical appointments when the miner actually had a brief routine 
appointment, or charging for the services of a professional when a 
paraprofessional or aide performed the service; industry standards 
prohibit unbundling services to charge separately for services that 
should be billed as a single charge.
    (2) The provider agrees to comply with all regulations set forth in 
this subpart concerning the provision of medical services or treatments 
and/or the process for seeking reimbursement for medical services and 
treatments, including the limitation imposed on the amount to be paid.


Sec.  725.716   How should a miner prepare and submit requests for 
reimbursement for covered medical expenses and transportation costs?

    (a) If a miner has paid bills for a medical service or treatment 
covered under Sec.  725.701 and seeks reimbursement for those expenses, 
he or she may submit a request for reimbursement on Form OWCP-915, 
together with an itemized bill. The reimbursement request must be 
accompanied by evidence that the provider received payment for the 
service from the miner and a statement of the amount paid. Acceptable 
evidence that payment was received includes, but is not limited to, a 
copy of the miner's canceled check (both front and back) or a copy of 
the miner's credit card receipt.
    (b) OWCP may waive the requirements of paragraph (a) of this 
section if extensive delays in the filing or the adjudication of a 
claim make it unusually difficult for the miner to obtain the required 
information.
    (c) Reimbursements for covered medical services paid by a miner 
generally will be no greater than the maximum allowable charge for such 
service as determined under Sec. Sec.  725.707-725.711.
    (d) A miner will be only partially reimbursed for a covered medical 
service if the amount he or she paid to a provider for the service 
exceeds the maximum charge allowable. If this happens, OWCP will advise 
the miner of the maximum allowable charge for the service in question 
and of his or her responsibility to ask the provider to refund to the 
miner, or credit to the miner's account, the amount he or she paid 
which exceeds the maximum allowable charge.
    (e) If the provider does not refund to the miner or credit to his 
or her account the amount of money paid in excess of the charge allowed 
by OWCP, the miner should submit documentation to OWCP of the attempt 
to obtain such refund or credit. OWCP may make reasonable reimbursement 
to the miner after reviewing the facts and circumstances of the case.
    (f) If a miner has paid transportation costs or other incidental 
expenses related to covered medical services under this part, the miner 
may submit a request for reimbursement on Form OWCP-957 or OWCP-915, 
together with proof of payment.


Sec.  725.717   What are the time limitations for requesting payment or 
reimbursement for medical services or treatments?

    OWCP will pay providers and reimburse miners promptly for all bills 
received on an approved form and in a timely manner. However, absent 
good cause, no bill will be paid for expenses incurred if the bill is 
submitted more than one year beyond the end of the calendar year in 
which the expense was incurred or the service or supply was provided, 
or more than one year beyond the end of the calendar year in which the 
miner's eligibility for benefits is finally adjudicated, whichever is 
later.


Sec.  725.718   How are disputes concerning medical benefits resolved?

    (a) If a dispute develops concerning medical services or treatments 
or their payment under this part, OWCP must attempt to informally 
resolve the dispute. OWCP may, on its own initiative or at the request 
of the responsible operator or its insurance carrier, order the 
claimant to submit to an examination by a physician selected by OWCP.
    (b) If a dispute cannot be resolved informally, OWCP will refer the 
case to the Office of Administrative Law Judges for a hearing in 
accordance with this part. Any such hearing concerning authorization of 
medical services or treatments must be scheduled at the earliest 
possible time and must take precedence over all other hearing

[[Page 770]]

requests except for other requests under this section and as provided 
by Sec.  727.405 of this subchapter (see Sec.  725.4(d)). During the 
pendency of such adjudication, OWCP may order the payment of medical 
benefits prior to final adjudication under the same conditions 
applicable to benefits awarded under Sec.  725.522.
    (c) In the development or adjudication of a dispute over medical 
benefits, the adjudication officer is authorized to take whatever 
action may be necessary to protect the health of a totally disabled 
miner.
    (d) Any interested medical provider may, if appropriate, be made a 
party to a dispute under this subpart.


Sec.  725.719   What is the objective of vocational rehabilitation?

    The objective of vocational rehabilitation is the return of a miner 
who is totally disabled by pneumoconiosis to gainful employment 
commensurate with such miner's physical impairment. This objective may 
be achieved through a program of re-evaluation and redirection of the 
miner's abilities, or retraining in another occupation, and selective 
job placement assistance.


Sec.  725.720   How does a miner request vocational rehabilitation 
assistance?

    Each miner who has been determined entitled to receive benefits 
under part C of title IV of the Act must be informed by OWCP of the 
availability and advisability of vocational rehabilitation services. If 
such miner chooses to avail himself or herself of vocational 
rehabilitation, his or her request will be processed and referred by 
OWCP vocational rehabilitation advisors pursuant to the provisions of 
Sec. Sec.  702.501 through 702.508 of this chapter as is appropriate.

    Dated: December 21, 2016.
Leonard J. Howie III,
Director, Office of Workers' Compensation Programs.
[FR Doc. 2016-31382 Filed 1-3-17; 8:45 am]
 BILLING CODE 4510-CR-P