Medicare Program; Clinical Laboratory Improvement Amendments of 1988 (CLIA) Fees, 67723-67728 [2018-28359]
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BILLING CODE 4120–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
[CMS–3356–NC]
RIN 0938–AT56
Medicare Program; Clinical Laboratory
Improvement Amendments of 1988
(CLIA) Fees
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Notice with comment period.
AGENCY:
This notice with comment
period announces the increase of certain
fees established under the Clinical
Laboratory Improvement Amendments
of 1988 (CLIA). The Public Health
Service Act (PHSA) requires the
Secretary to impose certificate fees to
cover the general costs of administering
the CLIA program, as well as additional
fees, including Inspection fees for nonaccredited laboratories. We are
increasing these fees to cover the cost of
administering the CLIA program as
required by statute. We seek public
comment regarding this increase, which
we believe is necessary to meet the
statutory requirements.
DATES: Comments: To be assured
consideration, comments must be
received at one of the addresses
provided below, no later than 5 p.m. on
March 1, 2019.
ADDRESSES: In commenting, refer to file
code CMS–3356–NC. Because of staff
and resource limitations, we cannot
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SUMMARY:
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accept comments by facsimile (FAX)
transmission.
Comments, including mass comment
submissions, must be submitted in one
of the following three ways (please
choose only one of the ways listed):
1. Electronically. You may submit
electronic comments on this regulation
to https://www.regulations.gov. Follow
the ‘‘Submit a comment’’ instructions.
2. By regular mail. You may mail
written comments to the following
address ONLY: Centers for Medicare &
Medicaid Services, Department of
Health and Human Services, Attention:
CMS–3356–NC, P.O. Box 8016,
Baltimore, MD 21244–8016. Please
allow sufficient time for mailed
comments to be received before the
close of the comment period.
3. By express or overnight mail. You
may send written comments to the
following address ONLY: Centers for
Medicare & Medicaid Services,
Department of Health and Human
Services, Attention: CMS–3356–NC,
Mail Stop C4–26–05, 7500 Security
Boulevard, Baltimore, MD 21244–1850.
For information on viewing public
comments, see the beginning of the
SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: For
policy related questions, please contact
Cindy Flacks, 410–786–6520, and
Caecilia Blondiaux, 410–786–2190.
For the Budget and Financial Impact,
please contact Jeffrey Pleines, 410–786–
0684.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All
comments received before the close of
the comment period are available for
viewing by the public, including any
personally identifiable or confidential
business information that is included in
a comment. We post all comments
received before the close of the
comment period on the following
website as soon as possible after they
have been received: https://
www.regulations.gov. Follow the search
instructions on that website to view
public comments.
I. Background
A. CLIA Fees
On October 31, 1988, Congress
enacted the Clinical Laboratory
Improvement Amendments of 1988
(CLIA) (Pub. L. 100–578), which
replaced in its entirety section 353 of
the Public Health Service Act (PHSA).
Section 353(m) of the PHSA requires the
Secretary to impose two separate types
of fees: ‘‘certificate fees’’ and
‘‘additional fees.’’ Certificate fees are
imposed for the issuance and renewal of
certificates and must be sufficient to
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cover the general costs of administering
the CLIA program, including evaluating
and monitoring approved proficiency
testing (PT) programs and accrediting
bodies and implementing and
monitoring compliance with program
requirements. Additional fees are
imposed for inspections of nonaccredited laboratories and for the cost
of performing PT on laboratories that do
not participate in approved PT programs
intended to cover the cost of evaluating
a laboratory to determine overall if an
accreditation organization’s standards
and inspection process is equivalent to
the CLIA program. These evaluations
are referred to as validation inspections.
The additional fees must be sufficient to
cover, among other things, the cost of
carrying out such inspections and PT.
Certificate and additional fees vary by
group or classification of laboratory,
based on such considerations as the
Secretary determines are relevant,
which may include the dollar volume
and scope of the testing being performed
by the laboratories, and only a nominal
fee may be required for the issuance and
renewal of Certificates of Waiver
(CoWs).
The regulations provide for a
methodology for determining fee
amounts (§ 493.649) and periodic
updating of the certificate fee amounts
(§ 493.638(b)) and compliance fee
amounts (§ 493.643(b)). Under
§ 493.645(b)(1), laboratories that are
issued a certificate of accreditation
(CoA) are assessed a fee to cover the cost
of validation inspections. All accredited
laboratories share in the cost of these
inspections. These costs are the same as
those that are incurred when inspecting
non-accredited laboratories.
B. CLIA Budget Process
With the exception of the ‘‘CLIA
Program; Fee Schedule Revision’’ notice
published in the August 29, 1997
Federal Register (62 FR 45815 through
45821), the fees imposed to cover the
costs of administering the CLIA program
have not been updated since 1992. The
fee amounts currently collected under
the CLIA regulations are based on
preliminary assumptions made in 1992
about future program operations and
workload requirements. After decades of
actual program experience, we have
determined that it is necessary to
increase certain CLIA fees to fund
current and future program operations
as required by section 353(m) of the
PHSA. Specifically, as discussed in
section II. of this notice with comment
period, we are increasing those CLIA
fees collected under § 493.638(b)
(hereinafter referred to as ‘‘Certificate
Fees’’), with the exception of fees for
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issuing a Certificate of Registration
(CoR); § 493.643(b) (hereinafter referred
to as ‘‘Compliance Fees’’); and
§ 493.645(b)(1) (hereinafter referred to as
‘‘Additional Fees’’) (collectively referred
to hereinafter as ‘‘CLIA Fees’’).
We routinely monitor incoming CLIA
Fee collections and compare them on a
monthly basis with the corresponding
amounts of obligations and
expenditures for all costs required to
support the operation of the CLIA
program, including state survey agency
(SA) awards, CMS administrative costs,
other federal agency costs, and contract
support. Over the past several years, we
have observed that the total amount of
incurred obligations in a given fiscal
year has outpaced the corresponding
amount of CLIA Fees collected over the
same timeframe, leading to decreases in
the level of budgetary resources
available to support program operations.
Factors contributing to the increased
obligations incurred by the CLIA
program include an increase in the
amount of time it takes to perform
surveys in laboratories that are using
more complex testing platforms and
laboratory developed tests, as well as
the overall inflation of the economy.
Based on our observations, we
performed a retrospective comparative
analysis of federal fiscal year (FY)-end
CLIA Fee collections and incurred
obligations over the prior six FYs (FY
2012 through FY 2017). As shown in
Table 1, the amount of incurred
obligations in each fiscal year has
exceeded the corresponding amount of
collected CLIA Fees.
TABLE 1—CMS COMPARATIVE ANALYSIS FYS 2012 THROUGH 2017
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
FY 2017
Certificate Fees Collected ........................
Compliance Fees Collected .....................
Sequester 1 ...............................................
Total, CLIA Fees Collected 2 ............
$36,343,753
13,213,680
0
49,557,433
$42,169,869
13,040,589
(2,760,521)
52,449,907
$41,173,724
12,823,731
(3,887,817)
50,109,639
$41,185,755
12,466,102
(3,916,586)
49,735,271
$42,369,451
13,468,981
(3,795,483)
52,042,948
$41,544,575
12,527,235
(3,730,969)
50,340,842
Total, CLIA Obligations 2 3 ................
Total, CLIA (Shortfall)/Surplus ..........
54,539,917
(4,982,484)
54,169,837
(1,719,930)
57,360,315
(7,250,677)
56,404,651
(6,669,380)
56,778,918
(4,735,970)
59,680,186
(9,339,344)
1 Sequester
is a reduction in budget authority authorized by Public Law 112–25, the Budget Control Act of 2011.
and obligations data taken from FY-end Healthcare Integrated General Ledger Accounting System (HIGLAS) reporting. Exempt
State Fees are categorized as Certificate Fees, because the state surveys their own laboratories and State Fees charged go to the state.
3 CLIA obligations include FY-end obligations for CMS administration (payroll, travel, training, supplies, contracts), other federal agencies
(CDC, FDA, Treasury, DHHS/OGC), and SA awards (surveys, PT, etc.).
2 Collections
Over the past few years, we have been
diligent in controlling administrative
costs, including use of carryover funds,
in an attempt to avoid a fee increase. For
example, we have controlled costs by
enhancing monitoring and control over
funds awarded to SAs for surveys,
reducing federal travel and training
expenses, as well as imposing strict
oversight of incurred contract costs.
Despite these efforts, a portion of CLIA’s
administrative obligations and
expenditures remains fixed and cannot
be further reduced without significant
disruption in program operations (for
example, limiting planned regulatory
and enforcement actions). Taking into
account annual inflation in the overall
economy, we anticipate that program
costs and concurrent obligations will
continue to increase, further
contributing to a projected shortfall in
collections. Moreover, our ability to
continue using carryover funds is
limited since we have used this
carryover to supplement shortfalls in
new collections over a number of years.
We project that without a fee increase,
the CLIA program would cease to be
self-sustaining at some point in FY
2020, as shown in Table 2.
TABLE 2—CMS PROJECTIONS FYS 2018 THROUGH 2020
[No Fee Increase]
Prior Year Carryover (SOY) 1 ......................................................................................................
Projected CLIA Fee Collections ..................................................................................................
Projected Sequester (6.6%, 6.2%) ..............................................................................................
Budgetary Resources ..................................................................................................................
Projected Obligations ...................................................................................................................
Projected Carryover (EOY) 2 .......................................................................................................
FY 2018
FY 2019
FY 2020
$43,494,763
51,900,306
(3,425,420)
91,969,649
62,500,000
29,469,649
$29,469,649
51,900,306
(3,217,819)
78,152,136
63,687,500
14,464,636
$14,464,636
51,900,306
(3,217,819)
63,147,123
65,024,938
(1,877,815)
1 Start
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2 End
of year balances.
of year balances.
Based on these projections, absent a
fee increase, our ability to maintain
effective program operations may be
jeopardized, potentially comprising
public health and safety. As a result, we
need to increase currently assessed
CLIA Fees to ensure effective program
operations.
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C. CLIA RFI Feedback
In January 2018, we published the
‘‘Request for Information: Revisions to
Personnel Regulations, Proficiency
Testing Referral, Histocompatibility
Regulations and Fee Regulations under
the Clinical Laboratory Improvement
Amendments (CLIA) of 1988’’ (83 FR
1004). As part of the general solicitation
for comments related to the CLIA Fees,
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more than a few commenters noted the
CLIA Compliance and Additional fees
have not been updated since 1992 and
supported increasing the fees. Some of
these commenters suggested the CLIA
Fees be reviewed annually and updated
as needed to cover the program costs of
performing biennial surveys.
One commenter raised concerns
related to increases to the CLIA Fees,
linking them to the recent changes to
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the Clinical Laboratory Fee Schedule
(CLFS) (see 81 FR 41036). While we
appreciate this commenter’s concerns,
we note that changes to the CLFS are
issued by Medicare and are separate and
distinct from changes to CLIA Fees.
As a result of the feedback received
from the 2018 RFI, as well as through
assessing the current program needs, we
are increasing the fees as outlined in
section II of this notice with comment
period. Additionally, we will consider
the comments received in response to
the 2018 RFI as well as this notice with
comment period in future rulemaking.
insufficient to keep pace with the CLIA
program costs.
As shown in Table 1, we must close
the $9.3 million gap between incurred
obligations and CLIA Fee collections in
FY 2017 to keep the program on a
sustained solvent basis projected over
time. To close this $9.3 million gap, we
first determined the appropriate fee
drivers, as shown in Table 3, and then
added the results together, along with
current State-Exempt Fees at about $1.1
million, to calculate the total projected
fees.
II. CLIA Fees Increase
For the reasons discussed in section I.
of this notice with comment period, we
are increasing the following CLIA Fees:
Certificate Fees (collected under
§ 493.638(b), with the exception of fees
for the issuance of a CoR); Compliance
Fees (collected under § 493.643(b)); and
Additional Fees (collected
under§ 493.645(b)(1)). These increases
are based on our review of historical
revenue and expenditure data, which
have shown that expenditures in
comparison to collections are
TABLE 3—CMS PROJECTED LABORATORY POPULATION AND SURVEY WORKLOAD, FY 2018
Schedule Codes
Waived
PPMP 1
LVA 2
Total
A
B
C
D
E
F
G
H
I
J
Non-Accredited ..
Accredited ..........
Other ..................
0
0
178,616
0
0
33,411
6,466
2,103
0
4,245
2,700
0
183
184
0
2,022
1,895
0
249
228
0
1,493
1,631
0
793
959
0
497
599
0
1,721
3,081
0
200
1,107
0
167
1,794
0
18,036
16,281
212,027
Total, CLIA
Lab Population ........
178,616
33,411
8,569
6,975
367
3,917
477
3,124
1,752
1,096
4,802
1,307
1,961
246,344
Total, CLIA
Compliance Surveys .........
0
0
3,500
2,330
110
1,124
145
839
445
285
995
141
144
10,058
1 Provider-Performed
Microscopy Procedures Laboratories (PPMP).
2 Low-Volume Laboratory (LVA).
For Certificate Fees, the driver used in
our calculations is one half of the
projected laboratory population for FY
2018 (123,172 CLIA laboratories),
broken out by state and laboratory
schedule code. We used one half of the
projected laboratory population to
determine an average annual collection
because all CLIA laboratories are billed
on a biennial basis. For Compliance
Fees, the driver used in our calculations
is the projected number of surveys
budgeted for FY 2018 (10,058 total
surveys). For Additional Fees for
accredited laboratory validation
inspections, the driver used in our
calculations is the projected number of
validation surveys budgeted for FY2018
(about 407). Using this methodology, we
project increased CLIA Fee collections
at $61.0 million in FY 2018, as opposed
to the currently collected $50.8 million,
plus the collection of $1.1 million in
State-Exempt Fees, for a total projected
collection of $62.1 million.
We have projected that we need to
increase the CLIA Fees described
previously by at least 18.6 percent
($9.339 million/$50.341 million, per
Table 1). In calculating projected
collections for FYs 2018 through 2021,
we rounded up to a 20 percent increase
to ensure a sufficient level of carryover
to maintain operations in the first two
quarters of FYs 2019 and 2020.
Generally, carryover funds are needed to
support program operations at the start
of any given FY, until a sufficient
amount of current FY collections is
accumulated and made available for
obligation. In rounding up to the 20
percent increase, we projected increased
FY 2018 collections at $62.1 million,
enough to reasonably approximate
projected FY 2018 obligations. To
calculate the $62.1 million in projected
collections, we multiplied the increased
fees by the appropriate fee drivers, as
shown in Table 3, and then added the
results together, along with current
State-Exempt Fees at about $1.1 million,
to calculate the total projected fees.
The total of fees collected by HHS
must be sufficient to cover the general
costs of administering the CLIA
program, and as indicated in Table 4,
upon publication of the final notice, we
project that the 20 percent increase will
be sufficient to fund the CLIA program
into FY 2022.
TABLE 4—CMS PROJECTIONS FYS 2018 THROUGH 2021
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[With 20 percent fee increase]
Prior Year Carryover (SOY) 1 ..........................................................................
Projected CLIA Fee Collections .......................................................................
Projected Sequester (6.6%, 6.2%) ..................................................................
Budgetary Resources ......................................................................................
Projected Obligations .......................................................................................
Projected Carryover (EOY) 2 ............................................................................
1 Start
FY 2018
FY 2019
FY 2020
FY 2021
$43,494,763
51,900,306
(3,425,420)
91,969,649
62,500,000
29,469,649
$29,469,649
58,714,011
(3,640,269)
84,543,392
63,687,500
20,855,892
$20,855,892
62,070,016
(3,848,341)
79,077,566
65,024,938
14,052,629
$14,052,629
62,070,016
(3,848,341)
72,274,303
66,390,461
5,883,842
of year balances.
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of year balances.
With this notice, we are increasing all
currently assessed CLIA Fees by 20
percent to close the gap between current
obligations and current collections, and
to account for a small increase in costs
for the current fiscal year. Fees for the
issuance of registration certificates
would not be increased as these
increases would not have substantial
impact.
The 20 percent increase would apply
to the following CLIA fee types:
1. Certificate Fees—collected under
§ 493.638(b), with the exception of fees
for the issuance of a CoR. Under
§ 493.638(b), the fee amount is based on
the category of test complexity, or on
the category of test complexity and
schedules or ranges of annual laboratory
test volume (excluding waived tests and
tests performed for quality control,
quality assurance, and PT purposes) and
specialties tested, with the amounts of
the fees in each schedule being a
function of the costs for all aspects of
general administration of CLIA as set
forth in § 493.649(b) and (c). Under
§ 493.649(a), the fee for issuance of a
CoR or CoC is based on the laboratory’s
scope and volume of testing. The
current Certificate Fees are already
based on each laboratory’s schedule’s
scope and volume of testing, including
test complexity and specialties tested.
Following the application of a uniform
20 percent increase to Certificate Fees
across all schedules, with the exception
of fees for the issuance of a CoR, the
new Certificate Fees will continue to
satisfy §§ 493.638(b) and 493.649(a).
2. Compliance Fees collected under
§ 493.643(b). Under § 493.649(a), the
amount of the fee in each schedule for
compliance determination inspections
is based on the average hourly rate
(which includes the costs to perform the
required activities and necessary
administration costs) multiplied by the
average number of hours required or, if
activities are performed by more than
one of the entities listed in § 493.649(b),
the sum of the products of the
applicable hourly rates multiplied by
the average number of hours required by
the entity to perform the activity.
As discussed in section I. of this
notice with comment period, current
Compliance Fees were established in
1992 based on estimates as to the
average time a survey would take, the
cost of the surveyor salary per hour, as
well as the size of the laboratory. Based
on FY 2017 available compliance fee
collections, we estimate that current
Compliance Fee collections cover
approximately 55 percent of current and
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future compliance determination costs.
Following the application of a uniform
20 percent increase to Compliance Fees
across all schedules, in combination
with the aforementioned increase to
Certificate Fees, the new Compliance
Fees will continue to satisfy
§ 493.649(a).
3. Additional Fees collected under
§ 493.645(b)(1). Under § 493.645(b)(1),
laboratories that are issued a CoA are
assessed an additional fee to cover the
cost of validation inspections. These
costs are the same as those that are
incurred when inspecting nonaccredited
laboratories. As discussed in section I.
of this notice with comment period,
current Additional Fees were
established in 1992 based on estimates
as to the average time a survey would
take, the cost of the surveyor salary per
hour, as well as the size of the
laboratory. Following the application of
a uniform 20 percent increase to
additional fees across all schedules, in
combination with the aforementioned
increases to Certificate Fees and
Compliance Fees, the new Additional
Fees will continue to satisfy
§§ 493.645(b)(1) and 493.649(a).
While we recognize that the 20
percent increase to CLIA Fees across all
schedule codes can be perceived as a
major increase for laboratories, we
intend for this approach to be a onetime adjustment to address the projected
shortfall to ensure the program can
remain self-sustaining into FY 2022. We
will continue to review our obligations
and collections and may make future
adjustments as needed to avoid
shortfalls. We considered multiple
options prior to this notice with
comment period, including limiting the
increase to varying percentages and
timeframes across a single fee type,
specifically Compliance Fees. For
example, we considered the following
options:
• Update the existing Compliance
Fees by updating the hours for all
classifications (schedules) of
laboratories and the hourly rates for all
states and territories.
• A one-time 70 percent increase in
Compliance Fees alone to meet
projected obligations, with a phased-in
two 35 percent Compliance Fee
increases over a two biennial survey
cycles.
As discussed previously, in regard to
the estimates established in 1992, we
are proposing the one-time 20 percent
increase across most CLIA Fees,
including Certificate (excluding CoR
fees) and Compliance Fees based on our
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comparison of FY 2017 obligations and
collections (see Table 1). Analysis
indicates that the difference between
collections and obligations results
primarily from inflationary increases
incurred since Compliance Fees were
set in 1992 and since Certificate Fees
user fees were last increased in 1997.
Furthermore, analysis shows that the
relative proportions of the certification
and compliance work to total program
obligations has remained virtually
consistent over time, at about 34 percent
for compliance and 66 percent for
certification. We believe the original
methodology for calculating CLIA fees
was reasonable at the time, with the
exception of excluding adjustments for
inflation, which has remained relatively
constant. Therefore, we determined that
a one-time 20 percent increase across
most currently assessed fees is the most
appropriate approach. The 20 percent
increase also meets our policy objectives
to keep any increase reasonably limited,
given the elapsed time since the CLIA
Fees were last updated.
III. Collection of Information
Requirements
This document does not impose
information collection requirements,
that is, reporting, recordkeeping or
third-party disclosure requirements.
Consequently, there is no need for
review by the Office of Management and
Budget under the authority of the
Paperwork Reduction Act of 1995 (44
U.S.C. 3501 et seq.).
IV. Response to Comments
Because of the large number of public
comments we normally receive on
Federal Register documents, we are not
able to acknowledge or respond to them
individually. We will consider all
comments we receive by the date and
time specified in the DATES section of
this preamble, and, if we proceed with
a subsequent document, we will
respond to the comments in the
preamble to that document.
V. Regulatory Impact Statement
A. Statement of Need
As discussed in section I. of this
notice with comment period, when
CLIA was enacted, and its implementing
regulations were finalized in 1992, CLIA
Fees were established based on
estimates as to the average time a survey
would take; cost of the surveyor salary
per hour; as well as the size of the
laboratory (schedules A, B, etc.). As
discussed in section III. of this notice
with comment period, we are increasing
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certain CLIA Fees based on our analysis
of the overall level of collections
relative to the costs of maintaining the
CLIA program, which project a shortfall
to begin in calendar year 2020.
B. Overall Impact
We have examined the impacts of this
rule as required by Executive Order
12866 on Regulatory Planning and
Review (September 30, 1993), Executive
Order 13563 on Improving Regulation
and Regulatory Review (January 18,
2011), the Regulatory Flexibility Act
(RFA) (September 19, 1980, Pub. L. 96–
354), section 1102(b) of the Social
Security Act (the Act), section 202 of the
Unfunded Mandates Reform Act of 1995
(March 22, 1995; Pub. L. 104–4),
Executive Order 13132 on Federalism
(August 4, 1999) and the Congressional
Review Act (5 U.S.C. 804(2)), and
Executive Order 13771 on Reducing
Regulation and Controlling Regulatory
Costs (January 30, 2017).
Executive Orders 12866 and 13563
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). Section 3(f) of Executive Order
12866 defines a ‘‘significant regulatory
action’’ as an action that is likely to
result in a rule: (1) Having an annual
effect on the economy of $100 million
or more in any one year, or adversely
and materially affecting a sector of the
economy, productivity, competition,
jobs, the environment, public health or
safety, or state, local or tribal
governments or communities (also
referred to as ‘‘economically
significant’’); (2) creating a serious
inconsistency or otherwise interfering
with an action taken or planned by
another agency; (3) materially altering
the budgetary impacts of entitlement
grants, user fees, or loan programs or the
rights and obligations of recipients
thereof; or (4) raising novel legal or
policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
Order. A regulatory impact analysis
(RIA) is required for economicallysignificant regulatory actions that are
likely to impose costs or benefits of
$100 million or more in any given year.
This notice with comment period is
not economically significant within the
meaning of section 3(f)(1) of the
Executive Order since the estimated cost
alone is not likely to exceed the $100
million annual threshold. Our upper
limit of estimated impact is under the
threshold of $150 million for the year of
2018 under Unfunded Mandates Reform
Act (UMRA). This notice with comment
period increases certain CLIA Fee
requirements and will affect
approximately 251,010 clinical
laboratories, resulting in some budget
implications.
The RFA requires agencies to analyze
options for regulatory relief of small
entities if a rule has a significant impact
on a substantial number of small
entities. For purposes of the RFA, we
assume that the great majority of clinical
laboratories are small entities, either by
virtue of being nonprofit organizations
or by meeting the Small Business
Administration definition of a small
business by having revenues of less than
$7.5 million to $38.5 million in any one
year. For purposes of the RFA, we
believe that approximately 82 percent of
clinical laboratories qualify as small
entities based on their nonprofit status
as reported in the American Hospital
Association Fast Fact Sheet, updated
January 2017 (https://www.aha.org/
system/files/2018-01/fast-facts-ushospitals-2017_0.pdf ). Individuals and
states are not included in the definition
of a small entity. We are voluntarily
preparing a Regulatory Impact Analysis
and are requesting public comments in
this area to assist us in making this
determination.
In addition, section 1102(b) of the Act
requires us to prepare a regulatory
impact analysis if a rule may have a
significant impact on the operations of
a substantial number of small rural
hospitals. This analysis must conform to
the provisions of section 604 of the
RFA. For purposes of section 1102(b) of
the Act, we define a small rural hospital
as a hospital that is located outside of
a metropolitan statistical area and has
fewer than 100 beds. We do not expect
this notice with comment period will
have a significant impact on small rural
hospitals. Laboratories in small rural
hospitals are already subject to CLIA
Fees. We are requesting public
comments in this area to assist us in
making this determination.
C. Anticipated Effects
This notice with comment period
impacts approximately 251,010 CLIA
certified laboratories.
TABLE 5—CURRENT AND NEW NATIONAL AVERAGE OF COMPLIANCE FEE UPDATE
[Compliance fee updates at 20 percent increase]
Current
average
(c)
Laboratory classification
(schedules)
khammond on DSK30JT082PROD with NOTICES
LVA ..........................................................................................................................................................................
A ...............................................................................................................................................................................
B ...............................................................................................................................................................................
C ..............................................................................................................................................................................
D ..............................................................................................................................................................................
E ...............................................................................................................................................................................
F ...............................................................................................................................................................................
G ..............................................................................................................................................................................
H ..............................................................................................................................................................................
I ................................................................................................................................................................................
J ...............................................................................................................................................................................
Table 5 reflects the national average of
compliance fees for each classification
of laboratories (schedules) that requires
inspection. Specifically, Table 5
represents the national average for each
schedule for the current Compliance
VerDate Sep<11>2014
16:24 Dec 28, 2018
Jkt 247001
Fees (noted with a ‘‘c’’) as paid
biennially by laboratories that hold a
CoC and the national average for each
schedule for the new Compliance Fees
(noted with a ‘‘n’’) that will be paid
biennially by laboratories that hold a
PO 00000
Frm 00016
Fmt 4703
Sfmt 4703
$300
994
1,325
1,657
1,947
2,237
2,527
2,817
3,107
3,397
3,673
New
average
(n)
$360
1,192
1,591
1,988
2,336
2,684
3,032
3,380
3,728
4,076
4,408
CoC. As discussed section II. of this
notice with comment period, Table 5
reflects a total increase of 20 percent
across all schedules.
E:\FR\FM\31DEN1.SGM
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Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices
TABLE 6—CURRENT AND NEW NATIONAL AVERAGE OF ADDITIONAL FEES FOR ACCREDITED LABORATORIES UPDATE
[Additional fee updates at 20 percent increase]
Current
average
(c)
Laboratory classification
(schedules)
LVA ..........................................................................................................................................................................
A ...............................................................................................................................................................................
B ...............................................................................................................................................................................
C ..............................................................................................................................................................................
D ..............................................................................................................................................................................
E ...............................................................................................................................................................................
F ...............................................................................................................................................................................
G ..............................................................................................................................................................................
H ..............................................................................................................................................................................
I ................................................................................................................................................................................
J ...............................................................................................................................................................................
Table 6 shows the national average of
Additional Fees for each schedule of
accredited laboratory. Specifically,
Table 6 represents the national average
fees for each schedule for the current
Additional Fees (noted with a ‘‘c’’) as
paid biennially by laboratories that hold
a CoA and the national average for the
new Additional Fees (noted with a ‘‘n’’)
that will be paid biennially by
New
average
(n)
$15
50
60
83
97
112
126
141
155
170
184
$18
60
80
99
117
134
152
169
186
204
220
laboratories that hold a CoA. As
discussed in section II. of this notice
with comment period, Table 6 reflects a
total increase of 20 percent across all
schedules.
TABLE 7—CLIA BIENNIAL CERTIFICATE FEES
Type of CLIA certificate
Laboratory schedule
Certificate of Waiver (CoW) .........................................
PPM ..............................................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
CoC and CoA ...............................................................
Not applicable ...............................................................
Not applicable ...............................................................
LVA ...............................................................................
A ...................................................................................
B ...................................................................................
C ...................................................................................
D ...................................................................................
E ...................................................................................
F ....................................................................................
G ...................................................................................
H ...................................................................................
I .....................................................................................
J ....................................................................................
Table 7 depicts the current and new
Certificate Fees, which reflects the 20
percent increase across all schedules,
with the exception of fees for the
issuance of a CoR.
E. Conclusion
khammond on DSK30JT082PROD with NOTICES
D. Regulatory Reform Analysis Under
E.O. 13771
Executive Order 13771, titled
Reducing Regulation and Controlling
Regulatory Costs, was issued on January
30, 2017 and requires that the costs
associated with significant new
regulations ‘‘shall, to the extent
permitted by law, be offset by the
elimination of existing costs associated
with at least two prior regulations.’’ It
has been determined that this notice
with comment period is not a
‘‘significant regulatory action’’ under
E.O. 12866 and thus is not considered
regulatory action under Executive Order
13771.
VerDate Sep<11>2014
16:24 Dec 28, 2018
Jkt 247001
Although the effect of the changes
will increase laboratory costs,
implementation of these changes will be
negligible in terms of workload for
laboratories as these fee increases are
operational and technical in nature and
do not require additional time to be
spent by laboratory employees.
We have determined that this notice
with comment period would not have a
significant economic impact on a
substantial number of small entities or
a significant impact in the operations of
a substantial number of small rural
hospitals and for these reasons, we are
not preparing analyses for either the
RFA or section 1102(b) of the Act.
In accordance with the provisions of
Executive Order 12866, this notice with
comment period was reviewed by the
Office of Management and Budget.
PO 00000
Frm 00017
Fmt 4703
Sfmt 4703
Current fee
$150.00
200.00
150.00
150.00
150.00
430.00
440.00
650.00
1,100.00
1,550.00
2,040.00
6,220.00
7,940.00
New fee
$180.00
240.00
180.00
180.00
180.00
516.00
528.00
780.00
1,320.00
1,860.00
2,448.00
7,464.00
9,528.00
Dated: December 14, 2018.
Seema Verma,
Administrator, Centers for Medicare &
Medicaid Services.
Dated: December 18, 2018.
Alex M. Azar II,
Secretary, Department of Health and Human
Services.
[FR Doc. 2018–28359 Filed 12–28–18; 11:15 am]
BILLING CODE 4120–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Physician-Focused Payment Model
Technical Advisory Committee;
Meetings
ACTION:
Notice of meetings.
This notice announces the
2019 meetings of the Physician-Focused
Payment Model Technical Advisory
Committee (PTAC). These meetings will
include deliberation and voting on
SUMMARY:
E:\FR\FM\31DEN1.SGM
31DEN1
]]>Agencies
[Federal Register Volume 83, Number 249 (Monday, December 31, 2018)]
[Notices]
[Pages 67723-67728]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28359]
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-3356-NC]
RIN 0938-AT56
Medicare Program; Clinical Laboratory Improvement Amendments of
1988 (CLIA) Fees
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice with comment period.
-----------------------------------------------------------------------
SUMMARY: This notice with comment period announces the increase of
certain fees established under the Clinical Laboratory Improvement
Amendments of 1988 (CLIA). The Public Health Service Act (PHSA)
requires the Secretary to impose certificate fees to cover the general
costs of administering the CLIA program, as well as additional fees,
including Inspection fees for non-accredited laboratories. We are
increasing these fees to cover the cost of administering the CLIA
program as required by statute. We seek public comment regarding this
increase, which we believe is necessary to meet the statutory
requirements.
DATES: Comments: To be assured consideration, comments must be received
at one of the addresses provided below, no later than 5 p.m. on March
1, 2019.
ADDRESSES: In commenting, refer to file code CMS-3356-NC. Because of
staff and resource limitations, we cannot accept comments by facsimile
(FAX) transmission.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may submit electronic comments on this
regulation to https://www.regulations.gov. Follow the ``Submit a
comment'' instructions.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-3356-NC, P.O. Box 8016,
Baltimore, MD 21244-8016. Please allow sufficient time for mailed
comments to be received before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address ONLY: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-3356-NC, Mail
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850. For
information on viewing public comments, see the beginning of the
SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: For policy related questions, please
contact Cindy Flacks, 410-786-6520, and Caecilia Blondiaux, 410-786-
2190.
For the Budget and Financial Impact, please contact Jeffrey
Pleines, 410-786-0684.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following
website as soon as possible after they have been received: https://www.regulations.gov. Follow the search instructions on that website to
view public comments.
I. Background
A. CLIA Fees
On October 31, 1988, Congress enacted the Clinical Laboratory
Improvement Amendments of 1988 (CLIA) (Pub. L. 100-578), which replaced
in its entirety section 353 of the Public Health Service Act (PHSA).
Section 353(m) of the PHSA requires the Secretary to impose two
separate types of fees: ``certificate fees'' and ``additional fees.''
Certificate fees are imposed for the issuance and renewal of
certificates and must be sufficient to cover the general costs of
administering the CLIA program, including evaluating and monitoring
approved proficiency testing (PT) programs and accrediting bodies and
implementing and monitoring compliance with program requirements.
Additional fees are imposed for inspections of non-accredited
laboratories and for the cost of performing PT on laboratories that do
not participate in approved PT programs intended to cover the cost of
evaluating a laboratory to determine overall if an accreditation
organization's standards and inspection process is equivalent to the
CLIA program. These evaluations are referred to as validation
inspections. The additional fees must be sufficient to cover, among
other things, the cost of carrying out such inspections and PT.
Certificate and additional fees vary by group or classification of
laboratory, based on such considerations as the Secretary determines
are relevant, which may include the dollar volume and scope of the
testing being performed by the laboratories, and only a nominal fee may
be required for the issuance and renewal of Certificates of Waiver
(CoWs).
The regulations provide for a methodology for determining fee
amounts (Sec. 493.649) and periodic updating of the certificate fee
amounts (Sec. 493.638(b)) and compliance fee amounts (Sec.
493.643(b)). Under Sec. 493.645(b)(1), laboratories that are issued a
certificate of accreditation (CoA) are assessed a fee to cover the cost
of validation inspections. All accredited laboratories share in the
cost of these inspections. These costs are the same as those that are
incurred when inspecting non-accredited laboratories.
B. CLIA Budget Process
With the exception of the ``CLIA Program; Fee Schedule Revision''
notice published in the August 29, 1997 Federal Register (62 FR 45815
through 45821), the fees imposed to cover the costs of administering
the CLIA program have not been updated since 1992. The fee amounts
currently collected under the CLIA regulations are based on preliminary
assumptions made in 1992 about future program operations and workload
requirements. After decades of actual program experience, we have
determined that it is necessary to increase certain CLIA fees to fund
current and future program operations as required by section 353(m) of
the PHSA. Specifically, as discussed in section II. of this notice with
comment period, we are increasing those CLIA fees collected under Sec.
493.638(b) (hereinafter referred to as ``Certificate Fees''), with the
exception of fees for
[[Page 67724]]
issuing a Certificate of Registration (CoR); Sec. 493.643(b)
(hereinafter referred to as ``Compliance Fees''); and Sec.
493.645(b)(1) (hereinafter referred to as ``Additional Fees'')
(collectively referred to hereinafter as ``CLIA Fees'').
We routinely monitor incoming CLIA Fee collections and compare them
on a monthly basis with the corresponding amounts of obligations and
expenditures for all costs required to support the operation of the
CLIA program, including state survey agency (SA) awards, CMS
administrative costs, other federal agency costs, and contract support.
Over the past several years, we have observed that the total amount of
incurred obligations in a given fiscal year has outpaced the
corresponding amount of CLIA Fees collected over the same timeframe,
leading to decreases in the level of budgetary resources available to
support program operations. Factors contributing to the increased
obligations incurred by the CLIA program include an increase in the
amount of time it takes to perform surveys in laboratories that are
using more complex testing platforms and laboratory developed tests, as
well as the overall inflation of the economy. Based on our
observations, we performed a retrospective comparative analysis of
federal fiscal year (FY)-end CLIA Fee collections and incurred
obligations over the prior six FYs (FY 2012 through FY 2017). As shown
in Table 1, the amount of incurred obligations in each fiscal year has
exceeded the corresponding amount of collected CLIA Fees.
Table 1--CMS Comparative Analysis FYs 2012 Through 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Certificate Fees Collected.............................. $36,343,753 $42,169,869 $41,173,724 $41,185,755 $42,369,451 $41,544,575
Compliance Fees Collected............................... 13,213,680 13,040,589 12,823,731 12,466,102 13,468,981 12,527,235
Sequester \1\........................................... 0 (2,760,521) (3,887,817) (3,916,586) (3,795,483) (3,730,969)
Total, CLIA Fees Collected \2\...................... 49,557,433 52,449,907 50,109,639 49,735,271 52,042,948 50,340,842
-----------------------------------------------------------------------------------------------
Total, CLIA Obligations \2\ \3\..................... 54,539,917 54,169,837 57,360,315 56,404,651 56,778,918 59,680,186
Total, CLIA (Shortfall)/Surplus..................... (4,982,484) (1,719,930) (7,250,677) (6,669,380) (4,735,970) (9,339,344)
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Sequester is a reduction in budget authority authorized by Public Law 112-25, the Budget Control Act of 2011.
\2\ Collections and obligations data taken from FY-end Healthcare Integrated General Ledger Accounting System (HIGLAS) reporting. Exempt State Fees are
categorized as Certificate Fees, because the state surveys their own laboratories and State Fees charged go to the state.
\3\ CLIA obligations include FY-end obligations for CMS administration (payroll, travel, training, supplies, contracts), other federal agencies (CDC,
FDA, Treasury, DHHS/OGC), and SA awards (surveys, PT, etc.).
Over the past few years, we have been diligent in controlling
administrative costs, including use of carryover funds, in an attempt
to avoid a fee increase. For example, we have controlled costs by
enhancing monitoring and control over funds awarded to SAs for surveys,
reducing federal travel and training expenses, as well as imposing
strict oversight of incurred contract costs. Despite these efforts, a
portion of CLIA's administrative obligations and expenditures remains
fixed and cannot be further reduced without significant disruption in
program operations (for example, limiting planned regulatory and
enforcement actions). Taking into account annual inflation in the
overall economy, we anticipate that program costs and concurrent
obligations will continue to increase, further contributing to a
projected shortfall in collections. Moreover, our ability to continue
using carryover funds is limited since we have used this carryover to
supplement shortfalls in new collections over a number of years.
We project that without a fee increase, the CLIA program would
cease to be self-sustaining at some point in FY 2020, as shown in Table
2.
Table 2--CMS Projections FYs 2018 Through 2020
[No Fee Increase]
----------------------------------------------------------------------------------------------------------------
FY 2018 FY 2019 FY 2020
----------------------------------------------------------------------------------------------------------------
Prior Year Carryover (SOY) \1\.................................. $43,494,763 $29,469,649 $14,464,636
Projected CLIA Fee Collections.................................. 51,900,306 51,900,306 51,900,306
Projected Sequester (6.6%, 6.2%)................................ (3,425,420) (3,217,819) (3,217,819)
Budgetary Resources............................................. 91,969,649 78,152,136 63,147,123
Projected Obligations........................................... 62,500,000 63,687,500 65,024,938
Projected Carryover (EOY) \2\................................... 29,469,649 14,464,636 (1,877,815)
----------------------------------------------------------------------------------------------------------------
\1\ Start of year balances.
\2\ End of year balances.
Based on these projections, absent a fee increase, our ability to
maintain effective program operations may be jeopardized, potentially
comprising public health and safety. As a result, we need to increase
currently assessed CLIA Fees to ensure effective program operations.
C. CLIA RFI Feedback
In January 2018, we published the ``Request for Information:
Revisions to Personnel Regulations, Proficiency Testing Referral,
Histocompatibility Regulations and Fee Regulations under the Clinical
Laboratory Improvement Amendments (CLIA) of 1988'' (83 FR 1004). As
part of the general solicitation for comments related to the CLIA Fees,
more than a few commenters noted the CLIA Compliance and Additional
fees have not been updated since 1992 and supported increasing the
fees. Some of these commenters suggested the CLIA Fees be reviewed
annually and updated as needed to cover the program costs of performing
biennial surveys.
One commenter raised concerns related to increases to the CLIA
Fees, linking them to the recent changes to
[[Page 67725]]
the Clinical Laboratory Fee Schedule (CLFS) (see 81 FR 41036). While we
appreciate this commenter's concerns, we note that changes to the CLFS
are issued by Medicare and are separate and distinct from changes to
CLIA Fees.
As a result of the feedback received from the 2018 RFI, as well as
through assessing the current program needs, we are increasing the fees
as outlined in section II of this notice with comment period.
Additionally, we will consider the comments received in response to the
2018 RFI as well as this notice with comment period in future
rulemaking.
II. CLIA Fees Increase
For the reasons discussed in section I. of this notice with comment
period, we are increasing the following CLIA Fees: Certificate Fees
(collected under Sec. 493.638(b), with the exception of fees for the
issuance of a CoR); Compliance Fees (collected under Sec. 493.643(b));
and Additional Fees (collected underSec. 493.645(b)(1)). These
increases are based on our review of historical revenue and expenditure
data, which have shown that expenditures in comparison to collections
are insufficient to keep pace with the CLIA program costs.
As shown in Table 1, we must close the $9.3 million gap between
incurred obligations and CLIA Fee collections in FY 2017 to keep the
program on a sustained solvent basis projected over time. To close this
$9.3 million gap, we first determined the appropriate fee drivers, as
shown in Table 3, and then added the results together, along with
current State-Exempt Fees at about $1.1 million, to calculate the total
projected fees.
Table 3--CMS Projected Laboratory Population and Survey Workload, FY 2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
Schedule Codes
Waived PPMP LVA -------------------------------------------------------------------------------- Total
\1\ \2\ A B C D E F G H I J
--------------------------------------------------------------------------------------------------------------------------------------------------------
Non-Accredited...................... 0 0 6,466 4,245 183 2,022 249 1,493 793 497 1,721 200 167 18,036
Accredited.......................... 0 0 2,103 2,700 184 1,895 228 1,631 959 599 3,081 1,107 1,794 16,281
Other............................... 178,616 33,411 0 0 0 0 0 0 0 0 0 0 0 212,027
-------------------------------------------------------------------------------------------------------------------
Total, CLIA Lab Population...... 178,616 33,411 8,569 6,975 367 3,917 477 3,124 1,752 1,096 4,802 1,307 1,961 246,344
-------------------------------------------------------------------------------------------------------------------
Total, CLIA Compliance Surveys.. 0 0 3,500 2,330 110 1,124 145 839 445 285 995 141 144 10,058
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Provider-Performed Microscopy Procedures Laboratories (PPMP).
\2\ Low-Volume Laboratory (LVA).
For Certificate Fees, the driver used in our calculations is one
half of the projected laboratory population for FY 2018 (123,172 CLIA
laboratories), broken out by state and laboratory schedule code. We
used one half of the projected laboratory population to determine an
average annual collection because all CLIA laboratories are billed on a
biennial basis. For Compliance Fees, the driver used in our
calculations is the projected number of surveys budgeted for FY 2018
(10,058 total surveys). For Additional Fees for accredited laboratory
validation inspections, the driver used in our calculations is the
projected number of validation surveys budgeted for FY2018 (about 407).
Using this methodology, we project increased CLIA Fee collections at
$61.0 million in FY 2018, as opposed to the currently collected $50.8
million, plus the collection of $1.1 million in State-Exempt Fees, for
a total projected collection of $62.1 million.
We have projected that we need to increase the CLIA Fees described
previously by at least 18.6 percent ($9.339 million/$50.341 million,
per Table 1). In calculating projected collections for FYs 2018 through
2021, we rounded up to a 20 percent increase to ensure a sufficient
level of carryover to maintain operations in the first two quarters of
FYs 2019 and 2020. Generally, carryover funds are needed to support
program operations at the start of any given FY, until a sufficient
amount of current FY collections is accumulated and made available for
obligation. In rounding up to the 20 percent increase, we projected
increased FY 2018 collections at $62.1 million, enough to reasonably
approximate projected FY 2018 obligations. To calculate the $62.1
million in projected collections, we multiplied the increased fees by
the appropriate fee drivers, as shown in Table 3, and then added the
results together, along with current State-Exempt Fees at about $1.1
million, to calculate the total projected fees.
The total of fees collected by HHS must be sufficient to cover the
general costs of administering the CLIA program, and as indicated in
Table 4, upon publication of the final notice, we project that the 20
percent increase will be sufficient to fund the CLIA program into FY
2022.
Table 4--CMS Projections FYs 2018 Through 2021
[With 20 percent fee increase]
----------------------------------------------------------------------------------------------------------------
FY 2018 FY 2019 FY 2020 FY 2021
----------------------------------------------------------------------------------------------------------------
Prior Year Carryover (SOY) \1\.................. $43,494,763 $29,469,649 $20,855,892 $14,052,629
Projected CLIA Fee Collections.................. 51,900,306 58,714,011 62,070,016 62,070,016
Projected Sequester (6.6%, 6.2%)................ (3,425,420) (3,640,269) (3,848,341) (3,848,341)
Budgetary Resources............................. 91,969,649 84,543,392 79,077,566 72,274,303
Projected Obligations........................... 62,500,000 63,687,500 65,024,938 66,390,461
Projected Carryover (EOY) \2\................... 29,469,649 20,855,892 14,052,629 5,883,842
----------------------------------------------------------------------------------------------------------------
\1\ Start of year balances.
[[Page 67726]]
\2\ End of year balances.
With this notice, we are increasing all currently assessed CLIA
Fees by 20 percent to close the gap between current obligations and
current collections, and to account for a small increase in costs for
the current fiscal year. Fees for the issuance of registration
certificates would not be increased as these increases would not have
substantial impact.
The 20 percent increase would apply to the following CLIA fee
types:
1. Certificate Fees--collected under Sec. 493.638(b), with the
exception of fees for the issuance of a CoR. Under Sec. 493.638(b),
the fee amount is based on the category of test complexity, or on the
category of test complexity and schedules or ranges of annual
laboratory test volume (excluding waived tests and tests performed for
quality control, quality assurance, and PT purposes) and specialties
tested, with the amounts of the fees in each schedule being a function
of the costs for all aspects of general administration of CLIA as set
forth in Sec. 493.649(b) and (c). Under Sec. 493.649(a), the fee for
issuance of a CoR or CoC is based on the laboratory's scope and volume
of testing. The current Certificate Fees are already based on each
laboratory's schedule's scope and volume of testing, including test
complexity and specialties tested. Following the application of a
uniform 20 percent increase to Certificate Fees across all schedules,
with the exception of fees for the issuance of a CoR, the new
Certificate Fees will continue to satisfy Sec. Sec. 493.638(b) and
493.649(a).
2. Compliance Fees collected under Sec. 493.643(b). Under Sec.
493.649(a), the amount of the fee in each schedule for compliance
determination inspections is based on the average hourly rate (which
includes the costs to perform the required activities and necessary
administration costs) multiplied by the average number of hours
required or, if activities are performed by more than one of the
entities listed in Sec. 493.649(b), the sum of the products of the
applicable hourly rates multiplied by the average number of hours
required by the entity to perform the activity.
As discussed in section I. of this notice with comment period,
current Compliance Fees were established in 1992 based on estimates as
to the average time a survey would take, the cost of the surveyor
salary per hour, as well as the size of the laboratory. Based on FY
2017 available compliance fee collections, we estimate that current
Compliance Fee collections cover approximately 55 percent of current
and future compliance determination costs. Following the application of
a uniform 20 percent increase to Compliance Fees across all schedules,
in combination with the aforementioned increase to Certificate Fees,
the new Compliance Fees will continue to satisfy Sec. 493.649(a).
3. Additional Fees collected under Sec. 493.645(b)(1). Under Sec.
493.645(b)(1), laboratories that are issued a CoA are assessed an
additional fee to cover the cost of validation inspections. These costs
are the same as those that are incurred when inspecting nonaccredited
laboratories. As discussed in section I. of this notice with comment
period, current Additional Fees were established in 1992 based on
estimates as to the average time a survey would take, the cost of the
surveyor salary per hour, as well as the size of the laboratory.
Following the application of a uniform 20 percent increase to
additional fees across all schedules, in combination with the
aforementioned increases to Certificate Fees and Compliance Fees, the
new Additional Fees will continue to satisfy Sec. Sec. 493.645(b)(1)
and 493.649(a).
While we recognize that the 20 percent increase to CLIA Fees across
all schedule codes can be perceived as a major increase for
laboratories, we intend for this approach to be a one-time adjustment
to address the projected shortfall to ensure the program can remain
self-sustaining into FY 2022. We will continue to review our
obligations and collections and may make future adjustments as needed
to avoid shortfalls. We considered multiple options prior to this
notice with comment period, including limiting the increase to varying
percentages and timeframes across a single fee type, specifically
Compliance Fees. For example, we considered the following options:
Update the existing Compliance Fees by updating the hours
for all classifications (schedules) of laboratories and the hourly
rates for all states and territories.
A one-time 70 percent increase in Compliance Fees alone to
meet projected obligations, with a phased-in two 35 percent Compliance
Fee increases over a two biennial survey cycles.
As discussed previously, in regard to the estimates established in
1992, we are proposing the one-time 20 percent increase across most
CLIA Fees, including Certificate (excluding CoR fees) and Compliance
Fees based on our comparison of FY 2017 obligations and collections
(see Table 1). Analysis indicates that the difference between
collections and obligations results primarily from inflationary
increases incurred since Compliance Fees were set in 1992 and since
Certificate Fees user fees were last increased in 1997. Furthermore,
analysis shows that the relative proportions of the certification and
compliance work to total program obligations has remained virtually
consistent over time, at about 34 percent for compliance and 66 percent
for certification. We believe the original methodology for calculating
CLIA fees was reasonable at the time, with the exception of excluding
adjustments for inflation, which has remained relatively constant.
Therefore, we determined that a one-time 20 percent increase across
most currently assessed fees is the most appropriate approach. The 20
percent increase also meets our policy objectives to keep any increase
reasonably limited, given the elapsed time since the CLIA Fees were
last updated.
III. Collection of Information Requirements
This document does not impose information collection requirements,
that is, reporting, recordkeeping or third-party disclosure
requirements. Consequently, there is no need for review by the Office
of Management and Budget under the authority of the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.).
IV. Response to Comments
Because of the large number of public comments we normally receive
on Federal Register documents, we are not able to acknowledge or
respond to them individually. We will consider all comments we receive
by the date and time specified in the DATES section of this preamble,
and, if we proceed with a subsequent document, we will respond to the
comments in the preamble to that document.
V. Regulatory Impact Statement
A. Statement of Need
As discussed in section I. of this notice with comment period, when
CLIA was enacted, and its implementing regulations were finalized in
1992, CLIA Fees were established based on estimates as to the average
time a survey would take; cost of the surveyor salary per hour; as well
as the size of the laboratory (schedules A, B, etc.). As discussed in
section III. of this notice with comment period, we are increasing
[[Page 67727]]
certain CLIA Fees based on our analysis of the overall level of
collections relative to the costs of maintaining the CLIA program,
which project a shortfall to begin in calendar year 2020.
B. Overall Impact
We have examined the impacts of this rule as required by Executive
Order 12866 on Regulatory Planning and Review (September 30, 1993),
Executive Order 13563 on Improving Regulation and Regulatory Review
(January 18, 2011), the Regulatory Flexibility Act (RFA) (September 19,
1980, Pub. L. 96-354), section 1102(b) of the Social Security Act (the
Act), section 202 of the Unfunded Mandates Reform Act of 1995 (March
22, 1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August
4, 1999) and the Congressional Review Act (5 U.S.C. 804(2)), and
Executive Order 13771 on Reducing Regulation and Controlling Regulatory
Costs (January 30, 2017).
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Section
3(f) of Executive Order 12866 defines a ``significant regulatory
action'' as an action that is likely to result in a rule: (1) Having an
annual effect on the economy of $100 million or more in any one year,
or adversely and materially affecting a sector of the economy,
productivity, competition, jobs, the environment, public health or
safety, or state, local or tribal governments or communities (also
referred to as ``economically significant''); (2) creating a serious
inconsistency or otherwise interfering with an action taken or planned
by another agency; (3) materially altering the budgetary impacts of
entitlement grants, user fees, or loan programs or the rights and
obligations of recipients thereof; or (4) raising novel legal or policy
issues arising out of legal mandates, the President's priorities, or
the principles set forth in the Executive Order. A regulatory impact
analysis (RIA) is required for economically-significant regulatory
actions that are likely to impose costs or benefits of $100 million or
more in any given year.
This notice with comment period is not economically significant
within the meaning of section 3(f)(1) of the Executive Order since the
estimated cost alone is not likely to exceed the $100 million annual
threshold. Our upper limit of estimated impact is under the threshold
of $150 million for the year of 2018 under Unfunded Mandates Reform Act
(UMRA). This notice with comment period increases certain CLIA Fee
requirements and will affect approximately 251,010 clinical
laboratories, resulting in some budget implications.
The RFA requires agencies to analyze options for regulatory relief
of small entities if a rule has a significant impact on a substantial
number of small entities. For purposes of the RFA, we assume that the
great majority of clinical laboratories are small entities, either by
virtue of being nonprofit organizations or by meeting the Small
Business Administration definition of a small business by having
revenues of less than $7.5 million to $38.5 million in any one year.
For purposes of the RFA, we believe that approximately 82 percent of
clinical laboratories qualify as small entities based on their
nonprofit status as reported in the American Hospital Association Fast
Fact Sheet, updated January 2017 (https://www.aha.org/system/files/2018-01/fast-facts-us-hospitals-2017_0.pdf ). Individuals and states
are not included in the definition of a small entity. We are
voluntarily preparing a Regulatory Impact Analysis and are requesting
public comments in this area to assist us in making this determination.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a metropolitan
statistical area and has fewer than 100 beds. We do not expect this
notice with comment period will have a significant impact on small
rural hospitals. Laboratories in small rural hospitals are already
subject to CLIA Fees. We are requesting public comments in this area to
assist us in making this determination.
C. Anticipated Effects
This notice with comment period impacts approximately 251,010 CLIA
certified laboratories.
Table 5--Current and New National Average of Compliance Fee Update
[Compliance fee updates at 20 percent increase]
------------------------------------------------------------------------
Current New average
Laboratory classification (schedules) average (c) (n)
------------------------------------------------------------------------
LVA..................................... $300 $360
A....................................... 994 1,192
B....................................... 1,325 1,591
C....................................... 1,657 1,988
D....................................... 1,947 2,336
E....................................... 2,237 2,684
F....................................... 2,527 3,032
G....................................... 2,817 3,380
H....................................... 3,107 3,728
I....................................... 3,397 4,076
J....................................... 3,673 4,408
------------------------------------------------------------------------
Table 5 reflects the national average of compliance fees for each
classification of laboratories (schedules) that requires inspection.
Specifically, Table 5 represents the national average for each schedule
for the current Compliance Fees (noted with a ``c'') as paid biennially
by laboratories that hold a CoC and the national average for each
schedule for the new Compliance Fees (noted with a ``n'') that will be
paid biennially by laboratories that hold a CoC. As discussed section
II. of this notice with comment period, Table 5 reflects a total
increase of 20 percent across all schedules.
[[Page 67728]]
Table 6--Current and New National Average of Additional Fees for
Accredited Laboratories Update
[Additional fee updates at 20 percent increase]
------------------------------------------------------------------------
Current New average
Laboratory classification (schedules) average (c) (n)
------------------------------------------------------------------------
LVA..................................... $15 $18
A....................................... 50 60
B....................................... 60 80
C....................................... 83 99
D....................................... 97 117
E....................................... 112 134
F....................................... 126 152
G....................................... 141 169
H....................................... 155 186
I....................................... 170 204
J....................................... 184 220
------------------------------------------------------------------------
Table 6 shows the national average of Additional Fees for each
schedule of accredited laboratory. Specifically, Table 6 represents the
national average fees for each schedule for the current Additional Fees
(noted with a ``c'') as paid biennially by laboratories that hold a CoA
and the national average for the new Additional Fees (noted with a
``n'') that will be paid biennially by laboratories that hold a CoA. As
discussed in section II. of this notice with comment period, Table 6
reflects a total increase of 20 percent across all schedules.
Table 7--CLIA Biennial Certificate Fees
----------------------------------------------------------------------------------------------------------------
Type of CLIA certificate Laboratory schedule Current fee New fee
----------------------------------------------------------------------------------------------------------------
Certificate of Waiver (CoW)................... Not applicable.................. $150.00 $180.00
PPM........................................... Not applicable.................. 200.00 240.00
CoC and CoA................................... LVA............................. 150.00 180.00
CoC and CoA................................... A............................... 150.00 180.00
CoC and CoA................................... B............................... 150.00 180.00
CoC and CoA................................... C............................... 430.00 516.00
CoC and CoA................................... D............................... 440.00 528.00
CoC and CoA................................... E............................... 650.00 780.00
CoC and CoA................................... F............................... 1,100.00 1,320.00
CoC and CoA................................... G............................... 1,550.00 1,860.00
CoC and CoA................................... H............................... 2,040.00 2,448.00
CoC and CoA................................... I............................... 6,220.00 7,464.00
CoC and CoA................................... J............................... 7,940.00 9,528.00
----------------------------------------------------------------------------------------------------------------
Table 7 depicts the current and new Certificate Fees, which
reflects the 20 percent increase across all schedules, with the
exception of fees for the issuance of a CoR.
D. Regulatory Reform Analysis Under E.O. 13771
Executive Order 13771, titled Reducing Regulation and Controlling
Regulatory Costs, was issued on January 30, 2017 and requires that the
costs associated with significant new regulations ``shall, to the
extent permitted by law, be offset by the elimination of existing costs
associated with at least two prior regulations.'' It has been
determined that this notice with comment period is not a ``significant
regulatory action'' under E.O. 12866 and thus is not considered
regulatory action under Executive Order 13771.
E. Conclusion
Although the effect of the changes will increase laboratory costs,
implementation of these changes will be negligible in terms of workload
for laboratories as these fee increases are operational and technical
in nature and do not require additional time to be spent by laboratory
employees.
We have determined that this notice with comment period would not
have a significant economic impact on a substantial number of small
entities or a significant impact in the operations of a substantial
number of small rural hospitals and for these reasons, we are not
preparing analyses for either the RFA or section 1102(b) of the Act.
In accordance with the provisions of Executive Order 12866, this
notice with comment period was reviewed by the Office of Management and
Budget.
Dated: December 14, 2018.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.
Dated: December 18, 2018.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
[FR Doc. 2018-28359 Filed 12-28-18; 11:15 am]
BILLING CODE 4120-01-P
