Medicare and Medicaid Programs; Requirements for Long-Term Care Facilities: Regulatory Provisions To Promote Efficiency, and Transparency, 34737-34768 [2019-14946]

Agencies

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

[Federal Register Volume 84, Number 138 (Thursday, July 18, 2019)]
[Proposed Rules]
[Pages 34737-34768]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-14946]



Federal Register / Vol. 84, No. 138 / Thursday, July 18, 2019 / 
Proposed Rules

[[Page 34737]]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 410, 482, 483, 485 and 488

[CMS-3347-P]
RIN 0938-AT36


Medicare and Medicaid Programs; Requirements for Long-Term Care 
Facilities: Regulatory Provisions To Promote Efficiency, and 
Transparency

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

ACTION: Proposed rule.

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SUMMARY: This proposed rule would reform the Medicare and Medicaid 
long-term care requirements that the Centers for Medicare & Medicaid 
Services has identified as unnecessary, obsolete, or excessively 
burdensome. This rule would increase the ability of health care 
professionals to apportion resources to improving resident care by 
eliminating or reducing requirements that impede quality care or that 
divert resources away from providing high quality care.

DATES: To be assured consideration, comments must be received at one of 
the addresses provided, no later than 5 p.m. on September 16, 2019.

ADDRESSES: In commenting, please refer to file code CMS-3347-P. 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-3347-P, P.O. Box 8010, 
Baltimore, MD 21244-1850.
    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-3347-P, 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: LTC Regulations Team, Ronisha 
Blackstone, Diane Corning, Mary Collins, Kristin Shifflett, Eric Laib, 
Lisa Parker, and Sheila Blackstock at (410) 786-6633.

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. Executive Summary and Background

A. Executive Summary

1. Purpose
    Over the past several years, we have revised the Conditions of 
Participation (CoPs), the Conditions for Coverage (CfCs), and 
requirements for long-term care (LTC) facilities to reduce the 
regulatory burden on providers and suppliers. We identified obsolete 
and burdensome regulations that could be eliminated or reformed to 
improve effectiveness or reduce unnecessary reporting requirements and 
other costs, with a particular focus on freeing up resources that 
health care providers, health plans, and states could use to improve 
and enhance resident health and safety. We have also examined policies 
and practices not codified in rules that could be changed or 
streamlined to achieve better outcomes for residents, while reducing 
burden on providers and suppliers of care, and we identified non-
regulatory changes to increase transparency and to become a better 
business partner. In addition, the Centers for Medicare & Medicaid 
Services (CMS) and the Department of Health and Human Services (HHS) 
have reaffirmed their shared commitment to the vision of creating an 
environment where agencies incorporate and integrate the ongoing 
retrospective review of regulations into Department operations to 
achieve a more streamlined and effective regulatory framework. The 
objectives are to improve the quality of existing regulations 
consistent with statutory requirements; streamline procedural solutions 
for businesses to enter and operate in the healthcare marketplace; 
maximize net benefits (including benefits that are difficult to 
quantify); and reduce costs and other burdens on businesses to comply 
with regulations.
    We are proposing changes to the current LTC requirements and survey 
process that would simplify and streamline the current requirements and 
thereby increase provider flexibility and reduce excessively burdensome 
regulations, while also allowing facilities to focus on providing high-
quality healthcare to their residents. This proposed rule would also 
reduce the frequency of certain required activities and, where 
appropriate, revise timelines for certain facility requirements and 
remove obsolete, duplicative, or unnecessary requirements. We believe 
that these proposals balance resident safety and quality of care, while 
also providing regulatory relief for facilities.
2. Summary of Major Provisions
a. Requirements for Participation
Resident Rights (Sec.  483.10)
    We propose to revise the requirement for facilities to ensure that 
residents remain informed of the name and specialties of the physician 
and other primary care professionals responsible for their care, and is 
provided with their contact information. Specifically, we propose to 
reduce burden by revising the provision to require facilities to 
provide residents with their primary care physician's name and contact 
information upon admission, with any change, or upon a resident's 
request.
    In addition, we propose revisions to the grievance policy 
requirements. Proposed revisions include clarifying that general 
feedback may not rise to the level of an official grievance, removing 
the specific duties required of the grievance official, removing 
prescriptive requirements related to written grievance decisions, and 
reducing the amount of time that facilities must retain evidence 
demonstrating the results of grievances from 3 years to 18 months.
Admission, Transfer, and Discharge Rights (Sec.  483.15)
    We propose to revise the requirement for facilities to send 
discharge notices to State LTC Ombudsman by applying this requirement 
to ``facility-initiated involuntary transfers and discharges'' only. 
This proposed revision would reduce the paperwork burden on facilities.
Quality of Care (Sec.  483.25)
    We propose to modify requirements to focus on the appropriate 
``use'' of bed

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rails and eliminate references to the ``installation'' of bed rails. 
These revisions would provide clarity and address stakeholder concerns 
regarding the purchase of beds with bed rails already in place with no 
practical means of removal.
Nursing Services (Sec.  483.35)
    We propose to reduce the timeframe that LTC facilities are required 
to retain posted daily nursing staffing data from 18 months to 15 
months, or as required by state law. The proposed revision would reduce 
a paperwork burden on facilities.
Behavioral Health (Sec.  483.40)
    We propose to remove requirements that are duplicative of other LTC 
requirements in other sections of the regulation, and improve clarity.
Pharmacy Services (Sec.  483.45)
    We propose to remove the existing requirement that Pro re Nata 
(PRN), or as needed, prescriptions for anti-psychotics cannot be 
renewed unless the attending physician or prescribing practitioner 
evaluates the resident for the appropriateness of that medication. This 
proposed revision would increase flexibility by allowing each facility 
to allow for PRN orders of all psychotropic medications to be extended 
beyond 14 days if the attending physician or prescribing practitioner 
believes it appropriate and documents his or her rationale in the 
resident's medical record and indicates the duration for the PRN order. 
We have also solicited specific comments concerning this proposed 
modification.
Food and Nutrition Services (Sec.  483.60)
    We propose to revise the required qualifications for a director of 
food and nutrition services to provide that those with several years of 
experience performing as the director of food and nutrition services in 
a facility could continue to do so. We propose that at a minimum an 
individual designated as the director of food and nutrition services 
would receive frequently scheduled consultations from a qualified 
dietitian or other clinically qualified nutrition professional; and 
would either have 2 or more years of experience in the position of a 
director of food and nutrition services, or have completed a minimum 
course of study in food safety that includes topics integral to 
managing dietary operations such as, but not limited to, foodborne 
illness, sanitation procedures, food purchasing/receiving, etc. This 
proposal would help to address concerns related to costs associated 
with training for existing staff and the potential need to hire new 
staff.
Administration (Sec.  483.70)
    We propose to clarify that data collected under the facility 
assessment requirement can be utilized to inform policies and 
procedures for other LTC requirements. In addition, we propose to 
remove duplicative requirements and revise the requirement for the 
review of the facility assessment from annually to biennially.
Quality Assurance and Performance Improvement (Sec.  483.75)
    We propose to revise the requirement for facilities to implement a 
Quality Assurance and Performance Improvement (QAPI) program by 
removing prescriptive requirements to allow facilities greater 
flexibility in tailoring their QAPI program to the specific needs of 
their individual facility.
Infection Control (Sec.  483.80)
    We propose to remove the requirement that the infection 
preventionist (IP) work at the facility ``part-time'' or have frequent 
contact with the infection prevention and control program (IPCP) staff 
at the facility. We will instead require that the facility must ensure 
that the IP has sufficient time at the facility to meet the objectives 
of its IPCP. We will also include comment solicitations on this 
proposal.
Compliance and Ethics Program (Sec.  483.85)
    We propose to remove many of the requirements from this section not 
expressly required by statute. Proposed revisions include removing the 
requirements for a compliance officer and compliance liaisons and 
revising the requirement for reviewing the program from annually to 
biennially.
Physical Environment (Sec.  483.90)
    We propose to allow older existing LTC facilities to continue to 
use the 2001 Fire Safety Equivalency System (FSES) mandatory values 
when determining compliance for containment, extinguishment, and people 
movement requirements. This proposal would allow older facilities who 
may not meet the FSES requirements in the recently adopted 2012 Life 
Safety Code (LSC) to remain in compliance with the older FSES without 
incurring substantial expenses to change their construction types, 
while maintaining resident and staff safety.
    In addition, we propose to revise the requirements that newly 
constructed, re-constructed, or newly certified facilities accommodate 
no more than two residents in a bedroom and equip each resident room 
with its own bathroom that has a commode and sink.
    Specifically, we propose to only apply this requirement to newly 
constructed facilities and newly certified facilities that have never 
previously been a nursing home. This would remove unintended 
disincentives to purchase facilities or make upgrades to existing 
facilities.
Technical Corrections
    We propose to correct several technical errors that have been 
identified in 42 CFR part 483 subpart B.
b. Survey, Certification, and Enforcement Procedures
Informal Dispute Resolution and Independent Informal Dispute Resolution 
(Sec.  488.331 and Sec.  488.431)
    We propose to revise the informal dispute resolution and 
independent informal dispute resolution processes to increase provider 
transparency by ensuring that administrative actions are processed 
timely, and that providers understand the outcomes of results.
Civil Money Penalties: Waiver of Hearing, Reduction of Penalty Amount 
(Sec.  488.436)
    We propose to eliminate the requirement for facilities to actively 
waive their right to a hearing in writing and create in its place a 
constructive waiver process that would operate by default when CMS has 
not received a timely request for a hearing. The accompanying 35 
percent penalty reduction would remain. This proposed revision would 
result in lower costs for most LTC facilities facing civil money 
penalties (CMP)s, and would streamline and reduce the administrative 
burden for stakeholders.
Phase 3 Implementation of Overlapping Regulatory Provisions
    The revised LTC requirements for participation are being 
implemented in three phases. Phases 1 and 2 were implemented in 
November of 2016 and 2017, respectively. Phase 3 includes additional 
regulatory provisions that are scheduled to be implemented on November 
28, 2019.
    Of the Phase 3 provisions, this regulation proposes revisions that, 
if finalized, would have an impact on provisions that fall into three 
primary areas--(1) designation and training of the infection 
preventionist (Sec.  483.80), QAPI (Sec.  483.75), and compliance and

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ethics program (Sec.  483.85). We propose to delay implementation of 
some these Phase 3 provisions until 1 year following the effective date 
of this regulation. We do not propose to delay those requirements 
related to the infection preventionist at Sec.  483.80(b)(1) through 
(4), (c) and Sec.  483.75(g)(1)(iv). This would avoid unnecessary work, 
confusion and burden associated with implementing provisions, which may 
then change in a final rule shortly thereafter.
3. Summary of Costs and Benefits
    In this proposed rule we have identified reforms in more than a 
dozen major sections of the existing Code of Federal Regulations (CFR) 
pertaining to LTC facilities. Every proposed reform aims to reduce 
regulatory burdens on these facilities without jeopardizing any 
responsibilities or practices that maintain or improve resident care. 
The ``benefits'' of this proposed rule are its cost reductions, and 
there are no known ``costs'' imposed by this regulation. Our proposals 
and these conclusions are explained throughout this preamble, and we 
welcome additional information on each, suggested improvements, 
additional reform proposals, and any other comments.
    In total, we have identified and proposed reductions in information 
collection burden whose annual costs today, and future annual savings 
will be approximately $59 million. We propose other reforms in current 
regulations that will generate annual savings in operating costs of 
almost $210 million. We also propose reducing punitive facility 
construction requirements that will save in excess of $325 million in 
costs over each of the next 5 years. Total estimated cost savings over 
each of the first 5 years are approximately $616 million.

B. Background

1. Statutory and Regulatory Authority of the Long-Term Care 
Requirements
    The provisions contained in this proposed rule are authorized by 
the general rulemaking authority for the Secretary of the Department of 
Health and Human Services (the Secretary) under sections 1102 and 1871 
of the Act, which afford the Secretary broad authority to promulgate 
such regulations as may be necessary to administer the Medicare and 
Medicaid programs.
    In addition, the Secretary has statutory authority to issue these 
rules under the Nursing Home Reform Act, (part of the Omnibus Budget 
Reconciliation Act of 1987 (``OBRA `87''), (Pub. L. 100-203, 101 Stat. 
1330 (1987)), which added sections 1819 and 1919 to the Act; those 
provisions authorize the Secretary to promulgate regulations that are 
``adequate to protect the health, safety, welfare, and rights of 
residents and to promote the effective and efficient use of public 
moneys.'' (Sections 1819(f)(1) and 1919(f)(1) of the Act). In addition, 
the Act authorizes the Secretary to impose ``such other requirements 
relating to the health and safety [and well-being] of residents as [he] 
may find necessary.'' (Sections 1819(d)(4)(B), 1919(d)(4)(B) of the 
Act). Under Sections 1819(c)(1)(A)(xi) and 1919 (c)(1)(A)(xi) of the 
Act, the Secretary may also establish ``other right[s]'' for residents, 
in addition to those expressly set forth in the statutes and 
regulations, to ``protect and promote the rights of each resident.''
    Section 1864(a) of the Act authorizes the Secretary to enter into 
agreements with state survey agencies (SAs) to determine whether 
facilities meet the Federal participation requirements for Medicare. 
Section 1902(a)(33)(B) of the Act provides for SAs to perform the same 
survey tasks for facilities participating or seeking to participate in 
the Medicaid program. The results of Medicare and Medicaid related 
surveys are used by Centers for Medicare and Medicaid Services (CMS) 
and the State Medicaid agency, respectively, as the basis for a 
decision to enter into or deny a provider agreement, recertify facility 
participation in one or both programs, or terminate the facility from 
the program. They are also used to determine whether one or more 
enforcement remedies should be imposed where noncompliance with federal 
requirements is identified.
2. October 2016 Long-Term Care Final Rule
    On October 4, 2016, we issued a final rule entitled, ``Medicare and 
Medicaid Programs; Reform of Requirements for Long-Term Care 
Facilities'' (81 FR 68688). This final rule significantly revised the 
requirements that LTC facilities must meet to participate in the 
Medicare and Medicaid programs. Prior to the final rule, the LTC 
requirements had not been comprehensively reviewed and updated since 
1991 (56 FR 48826, September 26, 1991), despite substantial changes in 
service delivery in this setting. The final rule included revisions 
that reflect advances in the theory and practice of service delivery 
and safety. In addition, the various revisions sought to achieve broad-
based improvements in the quality of care provided in LTC facilities 
and in resident safety.
    We received mixed reactions from LTC stakeholders in response to 
our revision of the LTC requirements. Overall, all stakeholders 
supported the regulation's focus on person-centered care and agreed 
that reforms to the existing requirements were necessary to support 
high quality care and quality of life in LTC facilities. While 
supportive of the goals of the regulation, some industry stakeholders 
noted that some of the changes needed to comply with the revised 
requirements would be costly and burdensome. Given the scope of the 
revisions, stakeholder requests for more time to comply with the 
requirements, and the financial impact that the regulation would impose 
on LTC facilities, we finalized a phased-in implementation of the 
requirements over a 3-year time period with the goal of reducing some 
of the burden placed on LTC facilities. Readers may refer to the 
October 2016 final rule (81 FR 68696) for a detailed discussion 
regarding the implementation timeframes for the requirements. In 
addition, we established an 18-month transition period for facilities 
who fall short on complying with the November 28, 2017 implementation 
of the Phase 2 Requirements of Participation. There would be a 
temporary 18-month moratorium on the imposition of civil money 
penalties, discretionary denials of payment for new admissions and 
discretionary termination where the remedy is based on a deficiency 
finding of the certain Phase 2 requirements; however, facilities would 
be required to invest in staff education and to come into compliance as 
quickly as possible (https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertificationGenInfo/Downloads/Survey-and-Cert-Letter-18-04.pdf).
3. Comment Solicitation in the Fiscal Year (FY) 2018 Skilled Nursing 
Facility Prospective Payment System (SNF PPS) Proposed Rule
    In the FY 2018 Skilled Nursing Facility Prospective Payment System 
(SNF PPS) proposed rule (82 FR 21014) published in the Federal Register 
on May 4, 2017, we solicited comments for feedback regarding areas of 
burden reduction and cost savings in LTC facilities. We received 184 
public comments in response to our request for comments. Commenters 
included LTC facilities, LTC consumers, LTC advocacy groups, many 
individual healthcare professionals, and various health care 
organizations and associations.
    In the FY 2018 SNF PPS proposed rule we also discussed potential 
areas for burden reduction including

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revisions to the grievance policy requirements, (Sec.  483.10(j)), the 
Quality Assurance and Performance Improvement (QAPI) program (Sec.  
483.75), and removing the requirement that discharge notices be sent to 
the LTC Ombudsman (Sec.  483.15). Commenters also provided additional 
suggestions for burden reduction. The majority of the additional 
suggestions were related to removing the requirement for a facility 
assessment and increasing the timeframe associated with reporting 
suspicions of resident abuse. One commenter provided a detailed 
financial analysis of their costs so far related to implementing their 
QAPI, Infection Control, and Compliance and Ethics programs. We also 
received additional comments related to the survey process and 
requirements for providing payroll-based journal data at Sec.  
483.75(u) (as implemented in the August 4, 2015 final rule entitled, 
``Medicare Program; Prospective Payment System (PPS) and Consolidated 
Billing for Skilled Nursing Facilities (SNF) for FY 2016, SNF Value-
Based Purchasing Program, SNF Quality Reporting Program, and Staffing 
Data Collection'' (80 FR 46389). Furthermore, several commenters also 
recommended that we not revise the requirements for purposes of 
reducing burden on facilities at the expense of the safety and quality 
of care provided to residents. These commenters noted that the true 
impact of the requirements cannot be assessed, as the majority have not 
yet been implemented.
    In combination with our internal review of the existing 
regulations, we have used stakeholder feedback to inform our policy 
decisions with regard to the proposals discussed in this rule. We note 
that we considered all of the stakeholder recommendations and 
specifically considered how each recommendation could potentially 
reduce burden without impinging on the health and safety of residents. 
In addition, we note that we are committed to transforming the health 
care delivery system--and the Medicare program--by putting an 
additional focus on person-centered care and working with providers, 
physicians, and residents to improve outcomes. We seek to reduce 
burdens for facilities and residents, improve the quality of care, 
decrease costs, and ensure that residents, their providers and 
physicians are making the best health care choices possible. Therefore, 
we are soliciting public comments on additional regulatory reforms for 
burden reduction. We specifically are seeking public comment on 
additional proposals or modifications to the proposals set forth in 
this rule that would further reduce burden on facilities and create 
cost savings, while also preserving quality of care and resident health 
and safety. Consistent with our ``Patients Over Paperwork'' Initiative, 
we are particularly interested in any suggestions to improve existing 
requirements, within our statutory authority, where they make providing 
quality care difficult or less effective. The most useful comments will 
be those that include data or evidence to support the position, offer 
suggestions to amend specific sections of the existing regulations, or 
offer particular additions.

II. Provisions of the Proposed Regulations

A. Requirements for Participation

1. Resident Rights (Sec.  483.10)
Choice of Attending Physician
    Section 483.10(d)(3) requires that facilities ensure that a 
resident remains informed of the name and specialties of the physician 
and other primary care professionals responsible for his or her care, 
and is provided with their contact information. While understanding 
that residents are often under the care of multiple healthcare 
professionals, we can see how this requirement could have the potential 
to substantially burden facilities with maintaining an exhaustive list 
of professionals for each resident. In addition, we understand that the 
use of ``remain informed'' is vague and may impose unnecessary burdens 
on both the facility and residents to meet this requirement. Therefore, 
we propose to revise this provision to remove the language indicating 
that facilities must ensure that residents remain informed and would 
instead specify that residents be informed of only their primary care 
physician's information at admission, with any change of such 
information, and upon the resident's request. We believe that this 
proposal clarifies the intent of the requirement, which is to ensure 
that a resident knows the name and contact information for the 
individual(s) primarily responsible for their care. The revision would 
ultimately reduce burden on facilities by specifically detailing their 
responsibilities under this requirement. We request additional feedback 
from LTC stakeholders regarding the need for residents to receive 
contact information for providers responsible for their care outside of 
their primary care physician, such as a psychiatrist or physical 
therapist, and how to contact that provider. Specifically, we are 
interested to learn how residents are typically provided with this 
information and whether it is a standard practice for the primary care 
physician or facilities to maintain and provide this type of contact 
information to residents.
Grievances
    The October 2016 final rule finalized a proposal at Sec.  483.10(j) 
to extensively expand the grievance process in LTC facilities. 
Specifically, facilities are required to establish a grievance policy 
to ensure the prompt resolution of grievances and identify a grievance 
officer to oversee the process. LTC stakeholders have supported the 
enhancement of residents' rights to voice grievances and emphasize the 
importance and seriousness of resident concerns. However, other 
industry stakeholders have also indicated that the expansion of the 
requirements for a grievance process is overly burdensome and costly, 
specifically with regard to maintaining evidence related to grievances, 
and staffing a grievance official.
    After further consideration, we believe that revisions can be made 
to these requirements to minimize prescriptiveness, while maintaining 
facility accountability. We are also requesting additional feedback 
regarding how to minimize burden while taking into account the rights 
of residents, and the additional burden on residents and long-term care 
ombudsmen if the proposed revisions to the requirements at Sec.  
483.10(j) are made. Specifically, we propose to revise Sec.  
483.10(j)(1) by adding language that would clarify the difference 
between resident feedback and a grievance. Section 483.10(j)(1) would 
be revised to state that the resident has the right to voice grievances 
to the facility or other agency or entity that hears grievances without 
discrimination or reprisal and without fear of discrimination or 
reprisal. Such grievances include those with respect to care and 
treatment which have been furnished as well as those which have not 
been furnished, the behavior of staff and of other residents; and other 
concerns regarding their LTC facility stay that differ from general 
feedback provided by the resident or their resident representatives. We 
believe that the addition of this language would help to streamline a 
facility's grievance process and ensure that the grievance process 
focuses on concerns that rise to the level of an official grievance. We 
believe that a streamlined process would increase efficiency and 
facility response to grievances, which will have a positive impact on a 
resident's ability to voice

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their grievances and have them resolved promptly. Furthermore, we 
believe that general feedback or complaints stem from general issues 
that can typically be resolved by staff present at the time a concern 
is voiced, while grievances are more serious and generally require 
investigation into allegations regarding the quality of care. It would 
be the facility's responsibility to include how they made this 
determination as to whether a comment was a grievance or general 
feedback as part of their grievance policy and ensure that residents 
were fully informed of such determination.
    We believe that the added language provides clarification without 
impeding on a resident's right to voice grievances. However, we want to 
emphasize that a resident's right to voice grievances and a facility's 
responsibility to make prompt efforts to resolve grievances fully 
remains. We expect that in the event a facility has not addressed 
general feedback provided repeatedly by a specific resident, or the 
same feedback filed by different residents, such lack of a resolution 
by the facility would raise their concerns to that of a grievance. 
Therefore, we would expect that as a general practice, facilities would 
continue to make every effort to resolve resident concerns before the 
grievance process is initiated. Nonetheless, we note that certain 
systems continue to be in place if a resident believes that their 
rights have been ignored or not appropriately addressed by the 
facilities. These include raising their concerns through the Ombudsman 
program, State Survey Agency, or the Quality Improvement Organization 
(QIO) program.
    We also propose to revise Sec.  483.10(j)(2) to remove the phrase 
``by the facility.'' The revision would read as follows, ``the resident 
has the right to, and the facility must make prompt efforts to, resolve 
grievances the resident may have, in accordance with this paragraph.'' 
We believe that this revision does not make any substantive changes, 
but would remove unnecessary language and improve readability. The 
facility's responsibility to make prompt efforts to resolve resident 
grievances fully remains.
    At Sec.  483.10(j)(4)(ii), we propose to remove the specific duties 
required of the grievance official who is responsible for overseeing 
the grievance process. We believe that this revision would address 
facility stakeholder concerns by allowing facilities greater 
flexibility in determining how their individual facility will ensure 
grievances are fully addressed. We note that facilities have the 
flexibility to assign the role of grievance official to existing staff, 
and the existing requirements do not prohibit facilities from assigning 
multiple or additional individuals to assist the grievance official in 
the oversight of the facility's grievance process. We do not believe 
that this proposal will have a negative impact on residents because 
residents will still have a specific individual(s) to directly report 
to their grievances. In addition, existing requirements at Sec.  
483.10(j)(3) also require facilities to make information on how to file 
a grievance or complaint available to the resident. This proposal does 
not impede on a resident's right to voice grievances, but rather 
removes prescriptiveness and allows facilities some flexibility in 
delegating the responsibilities of the grievance official.
    Section 483.10(j)(4)(v) requires facilities to ensure that all 
written grievance decisions include the date the grievance was 
received, a summary statement of the resident's grievance, the steps 
taken to investigate the grievance, a summary of the pertinent findings 
or conclusions regarding the resident's concern(s), a statement as to 
whether the grievance was confirmed or not confirmed, any corrective 
action taken or to be taken by the facility as a result of the 
grievance, and the date the written decision was issued. We propose to 
revise Sec.  483.10(j)(4)(v) to require facilities to ensure that any 
written grievance decisions include any pertinent information including 
but not limited to a summary of the findings or conclusions and any 
corrective actions. We expect that information, such as the date the 
grievance was received and a summary statement of the resident's 
grievance, is included as a standard practice to ensure that the 
written decision is complete and informative. This revision would 
remove much of the specificity included in the provision in an effort 
to focus on the true intent of the requirement, which is to clearly 
inform residents of grievance decisions and any corrective actions.
    Lastly, we propose to revise Sec.  483.10(j)(4)(vii), to require 
facilities to maintain evidence demonstrating the results of all 
grievances for a period of no less than 18 months from the issuance of 
the grievance decision. We are not proposing to remove the requirement 
to maintain records because we believe that record retention related to 
grievances protects both facilities and residents. Instead, we are 
proposing a timeframe of 18 months, as this time period would cover the 
longest possible interval between surveys for a facility (plus a few 
months) and provide a sufficient amount of information for 
investigations during a survey. Reducing this timeframe to 18 months 
from the existing requirement of 3 years, would uphold facility 
accountability while reducing the burden associated with maintaining 
records.
    We request additional feedback regarding any unintentional 
consequences related to shortened timeframes for record retentions and 
whether there may be a need to retain records of grievances longer than 
a survey cycle.
2. Admission, Transfer, and Discharge Rights (Sec.  483.15)
    Regulations at Sec.  483.15(c)(3)(i) require LTC facilities to send 
transfers or discharge notices to the State LTC Ombudsman. As part of 
the FY 2018 SNF PPS proposed rule comment solicitation as previously 
discussed (82 FR 21014) we received valuable feedback from LTC 
stakeholders, including representatives of various Offices of State 
Long-Term Care Ombudsman, regarding a LTC Ombudsman's capacity to 
receive and review these notices. Stakeholders have indicated that 
there are some states that currently require involuntary discharge 
notices to be shared with the State LTC Ombudsman offices with 
requirements outlined for notification.
    We also received valuable feedback with regard to the extent that a 
LTC Ombudsman will use this information once received. Stakeholders 
indicated that LTC Ombudsman programs are currently receiving notices 
and use the information to help individual residents, track trends, and 
advocate for systems changes to reduce inappropriate discharges.
    After considering all of the feedback received and re-evaluating 
this requirement, we believe that the requirement is valuable; however, 
further clarification in the requirements is necessary to achieve the 
intended objective of reducing inappropriate discharges. Therefore, we 
propose to revise Sec.  483.15(c)(3)(i) to specify that facilities must 
send a copy of a transfer or discharge notice to a representative of 
the Office of the State Long-Term Care Ombudsman only in the event of 
facility-initiated involuntary transfers or discharges. We note that 
this would not include residents who request the transfer, or who are 
transferred, on an emergency basis to an acute care facility when 
return is expected. We are soliciting comments on whether the 
requirement to send copies of transfer notices to the LTC Ombudsman 
should apply to transfers made on an emergency basis to an acute care 
facility, regardless of return status and

[[Page 34742]]

how this information, when a resident is expected to return, may be 
beneficial.
    Furthermore, by ``facility-initiated'' involuntary transfer or 
discharge we mean a transfer or discharge that the resident objects to, 
did not originate through a resident's verbal or written request, and/
or is not in alignment with the resident's stated goals for care and 
preferences. We encourage readers to refer to the Interpretive Guidance 
for additional information regarding when this requirement does and 
does not apply at https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/som107ap_pp_guidelines_ltcf.pdf.
    We believe that this revision continues to support our goal of 
protecting residents in instances of involuntary transfers and 
discharges and reduces burden by streamlining the notification process 
to focus only on involuntary transfers or discharges. Streamlining this 
requirement would also improve resident access to the services of the 
Ombudsman program to assist during the discharge process by allowing 
Ombudsman offices to focus directly on inappropriate and involuntary 
discharges by facilities.
3. Quality of Care (Sec.  483.25)
    Regulations in Sec.  483.25 set forth requirements for numerous 
aspects of care and special needs of LTC facility residents. 
Regulations at Sec.  483.25(n) require facilities to attempt to use 
appropriate alternatives prior to installing a side or bed rail. 
Section 483.25(n)(1) through (4) specifies requirements for when a 
facility uses bed or side rails. Specifically, facilities must ensure 
correct installation, use and maintenance of bed rails, including 
assessing the resident for the risk of entrapment from bed rails prior 
to installation, reviewing the risks and benefits of bed rails with the 
resident and obtaining informed consent prior to installation, ensuring 
that the resident's size and weight are appropriate for the bed's 
dimensions, and following the manufacturers' recommendations and 
specifications for installing and maintaining bed rails.
    We received several inquiries from LTC stakeholders, as well as 
surveyors regarding these requirements and CMS' intent. Specifically, 
stakeholders have indicated that often times beds are purchased with 
bed rails already installed. In these instances, industry stakeholders 
are concerned with the inspection requirements ``prior to 
installation,'' specifically whether they are required to remove these 
bed rails or whether they can remain on beds, but not in use. 
Furthermore, if removal is required industry stakeholders have shared 
concerns regarding warranty agreements and surveyors have questioned 
how to evaluate compliance in these instances.
    We agree that revisions are necessary to improve clarity. Given the 
potential risks associated with the use of bed rails, including 
accident hazards and physical restraint, this requirement is intended 
to ensure that facilities attempt alternatives prior to installing bed 
rails and ensure that resident safety is considered if/when they are 
being used. To clarify this, we propose to revise Sec.  483.25(n) to 
remove references to the ``installation'' of bed rails and replace them 
with the ``use'' of bed rails. These revisions would focus on the 
appropriate use of bed rails when alternatives to bed rails are not 
feasible and address concerns related to the use of beds with bed rails 
already installed.
4. Nursing Services (Sec.  483.35)
    Regulations in Sec.  483.35 address certain aspects of LTC facility 
staffing and the need to consider the competencies of staff and 
resident acuity. Regulations at Sec.  483.35(g) require facilities to 
post daily nurse staffing data that includes, among other information, 
the total number and the actual hours worked by licensed and unlicensed 
nursing staff directly responsible for resident care per shift. Section 
483.35(g)(4) requires facilities to maintain the posted daily nurse 
staffing data for a minimum of 18 months, or as required by state law, 
whichever is greater. We understand that some industry stakeholders 
believe that the new requirements for payroll-based journal (PBJ) 
staffing reporting at Sec.  483.70(g) may be similar to the requirement 
at Sec.  483.35(g)(4). Specifically, regulations at Sec.  483.70(g) 
require facilities to electronically submit to CMS complete and 
accurate direct care staffing information, including information for 
agency and contract staff, based on payroll and other verifiable and 
auditable data in a uniform format according to specifications 
established by CMS.
    These regulations differ in that the requirements at Sec.  
483.70(g) provide a retrospective reporting of staffing so consumers 
can understand the type of staffing that exists in a facility on an 
average day, while the requirements at Sec.  483.35(g) of daily 
postings provide real time information for residents and their families 
so that they are informed of who is working and the amount of staff 
working in their facility during a specific shift.
    Therefore, we believe that both requirements are necessary. 
However, we believe that we may provide some flexibility in the 
regulations at Sec.  483.35(g)(4) regarding the timeframe for retaining 
the posted information. We propose to revise Sec.  483.35(g)(4) by 
reducing the timeframe for the retention of the nurse staffing data 
from 18 months to 15 months. We believe that 15 months of this 
facility-stored data would be sufficient to support any potential 
surveyor investigations.
5. Behavioral Health (Sec.  483.40)
    Regulations at Sec.  483.40 require facilities to provide the 
necessary behavioral health care and services for their residents to 
attain or maintain their highest practicable physical, mental, and 
psychosocial well-being, in accordance with the comprehensive 
assessment and plan of care. Behavioral health is defined as 
encompassing a resident's whole emotional and mental well-being, which 
includes, but is not limited to, the prevention and treatment of mental 
and substance use disorders. Facilities must also have sufficient staff 
who provide direct services to the residents with the appropriate 
competencies and skill sets to provide nursing and related services. 
LTC stakeholders have recommended that we eliminate this section 
entirely or reconsider the requirements to address burden and avoid 
turning LTC facilities into mental health institutions. LTC 
stakeholders have also indicated that the regulations lack clarity and 
noted that there may be duplication of the requirements in this section 
elsewhere.
    In further reviewing Sec.  483.40, we continue to believe that a 
focus on the care and treatment for residents with mental disorders or 
psychosocial adjustment difficulties is necessary. Therefore, we are 
not proposing to eliminate this section, as suggested by some 
stakeholders. However, during our review of these requirements we 
identified areas of duplication that could be eliminated. We are 
proposing revisions to this section to improve clarity and ensure that 
our regulations clearly reflect what we require from facilities.
    Specifically, Sec.  483.40(a) requires facilities to have 
sufficient staff who provide direct services to residents with the 
appropriate competencies and skill sets to provide nursing and related 
services, in accordance with a facility's assessment (Sec.  483.70(e)). 
This requirement duplicates the requirements at Sec.  483.35, ``Nursing 
Services,'' which specify the general requirements for sufficient 
staff. To simplify the overall requirement, we propose to remove the 
duplicative language in Sec.  483.40(a). This revision

[[Page 34743]]

would clearly articulate the intent of this requirement, which is to 
inform facilities of their responsibility to provide sufficient staff 
members who possess the basic competencies and skills sets to meet the 
behavioral health needs of residents for whom the facility has assessed 
and developed care plans.
    Likewise, in further reviewing this section we have determined that 
Sec.  483.40(c) is identical to the requirements in Sec.  483.65(a), 
``Specialized Rehabilitative Services.'' Therefore, we are proposing to 
remove Sec.  483.40(c) from this section.
    In addition, to these proposed revisions, we encourage those 
stakeholders seeking further clarity regarding the implementation of 
the Behavioral Health requirements, as well as the other regulatory 
sections, to look to the Interpretive Guidelines as a valuable 
resource. On June 20, 2017, CMS released Interpretive Guidelines for 
the LTC requirements for participation (https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/som107ap_pp_guidelines_ltcf.pdf), which were developed with input from 
a variety of stakeholders including industry, clinical, and advocacy 
organizations.
6. Pharmacy Services (Sec.  483.45)
    The existing regulations at Sec.  483.45(e)(4) require that PRN 
prescriptions for psychotropic drugs be limited to 14 days. However, if 
the attending physician or prescribing practitioner believes it is 
appropriate for a PRN prescription order to be extended beyond 14 days, 
he or she may document their rationale in the resident's medical record 
and indicate the duration of the PRN order. However, that exception 
does not extend to anti-psychotics, which are limited to 14 days, 
unless the attending physician or prescribing practitioner evaluates 
the resident for the appropriateness of that medication, as set forth 
at current Sec.  483.45(e)(5).
    We received feedback from the provider community concerning the 
burden resulting from the limitations on PRN orders for psychotropic 
drugs. These commenters said that the 14-day limitation could 
negatively impact the resident care. Many facilities, especially those 
that are small or in rural areas, already have difficulty with access 
to physicians and other health care providers, especially mental health 
practitioners. They were very concerned that there could be 
interruptions in resident care due to PRN orders expiring according to 
the Sec.  483.45(e)(4) and (5) and not being renewed or getting another 
order before that time. To avoid not being in compliance with the 
requirements for PRN orders, some commenters were concerned that 
prescribers would write routine orders that would result in residents 
receiving more of the drug more often than if it were given PRN or only 
as needed.
    We have also received feedback from both providers that primarily 
focused their comments on the burden imposed by the PRN requirements 
and advocates for residents that focused their comments on residents' 
rights. For example, a large organization representing mental health 
professionals indicated that they fully understood the need for 
safeguards to protect residents from inappropriate prescribing 
practices that place the convenience of the caregivers above the 
residents' interests. However, they also stated that the policies CMS 
had instituted on psychotropic drugs, were interfering with 
psychiatrists being able to appropriately treat residents with mental 
health and substance abuse disorders. They pointed to the increased 
scrutiny surrounding psychotropic medications, as well as the 
requirement for gradual dose reductions. They stated that the 
requirement for the in-person evaluation for residents who were on a 
PRN order for an anti-psychotic was unrealistic considering the access 
to care issues in several care settings. In addition, they were 
concerned about what they described as ``minimal standardized guidance 
provided to CMS surveyors'' that had resulted in ``improper rejections/
citations for appropriate pharma-therapeutic decisions and 
documentation by psychiatrists, and this has become very detrimental to 
their patients'' while resulting in a significant administrative 
burden. This perspective demonstrates that while providers want to 
provide quality care to residents they can be frustrated with increased 
administrative burden and pressure to not use medications they believe 
are appropriate for the residents they care for.
    Another perspective is evident in a report published on February 5, 
2018, by the Human Rights Watch (HRW), ``They Want Docile''--How 
Nursing Homes in the United States Overmedicate People with Dementia'' 
(https://www.hrw.org/report/2018/02/05/they-want-docile/how-nursing-homes-united-states-overmedicate-people-dementia).
    This report describes their findings based on visiting numerous 
nursing homes, interviewing nursing home residents, their families, the 
facility staff, and other officials and experts in LTC care, including 
LTC ombudsmen, as well as an analysis of publically available data, 
including academic studies. This report found, among other things, that 
anti-psychotic medications were being used as chemical restraints and 
for the convenience of the staff in LTC facilities. Residents that were 
interviewed described how traumatic it was to lose their ability to 
stay awake, think, and communicate. The report also noted that a review 
of the data, as well the interviews, suggested that some nursing homes 
are circumventing the pressure to reduce anti-psychotic drug use by 
seeking an appropriate diagnosis from a physician that would justify 
the use of these drugs for a resident, typically schizophrenia. This 
concern was significant enough for numerous organizations to issue a 
joint statement on ``Diagnosing Schizophrenia in Skilled Nursing 
Centers.'' \1\ that read, in part, ``[w]hile there is a national need 
for better and more approved treatments for behavioral and psychiatric 
symptoms in dementia, clinicians need to be mindful of, and avoid, 
labeling patients with other diagnoses to justify the use of 
medications or other treatments.''
---------------------------------------------------------------------------

    \1\ ``Joint Summary Statement--Diagnosing Schizophrenia in 
Skilled Nursing Centers,'' press release, The Society for Post-Acute 
and Long-Term Care Medicine, February 21, 2017, https://www.paltc.org/newsroom/joint-summary-statementdiagnosing-schizophrenia-skilled-nursing-centers (accessed August 20, 2018).
---------------------------------------------------------------------------

    In proposing changes to the PRN requirements for psychotropic 
medications, which include anti-psychotic drugs, we must ensure that 
the proposed requirements provide sufficient protections for residents 
from receiving inappropriate or unnecessary drugs and that medications 
are prescribed for residents based on their health care needs and not 
for the convenience of the staff or any other inappropriate reasons. 
However, we must also be mindful not to propose requirements that are 
overly burdensome to the facilities and health care providers that do 
not contribute to the quality of care for the residents, especially if 
they could result in interfering with residents receiving appropriate 
care for their health care needs.
    Based on further consideration and the feedback we received, we 
agree that the current requirements could result in interruptions to 
some residents' care that could have a negative impact. Therefore, we 
propose to revise Sec.  483.45(e)(4) and (5). Revised Sec.  
483.45(e)(4) would state that ``PRN orders for psychotropic drugs are 
limited to 14 days. If the attending physician or prescribing 
practitioner

[[Page 34744]]

believes that it is appropriate for the PRN order to be extended beyond 
14 days, the order can be extended in accordance with the facility's 
policy if he or she documents his or her rationale in the resident's 
medical record and indicates the duration for the PRN order.'' Thus, 
there would be no distinction between anti-psychotics and other 
psychotropic medications. Section 483.45(e)(5) would be revised to 
require, in addition to the current requirements, that the facility's 
policies, standards, and procedures use recognized standards of 
practice; including the circumstances upon which PRN orders for 
psychotropic drugs could be extended beyond the 14-day limitation; and 
that the facility take into consideration individualized resident' 
needs for psychotropic drugs. We believe that having the same 
requirements for all psychotropic drugs will simplify the survey 
process and reduce improper deficiency citations, as well as remove 
potential obstacles for mental health professionals to provide quality 
care for residents. We believe that these changes will provide the 
flexibility that facilities and providers need to assure that they can 
care for their residents without excessive administrative burden.
    We have not indicated any specific ``recognized standards of 
practice.'' We expect that experts in medicine and pharmacology would 
develop national standards that could be used in LTC facilities. In 
addition, we would be interested in any comments on standards that 
could be used to satisfy this requirement. We would also expect the 
mental health professionals that practice in the facility, as well as 
the medical director and director of nursing for the facility, would 
have significant input into the facilities' policies.
    We remain concerned about the potential misuse of psychotropic 
drugs, especially anti-psychotics. Therefore, we are soliciting 
comments on whether these proposed modifications to the requirements 
concerning PRN orders for psychotropic drugs provide sufficient 
protection for residents. We welcome feedback on whether CMS should 
retain the current PRN policy for anti-psychotic drugs. We are also 
interested in additional information regarding the impact that the 
current PRN policy for anti-psychotic drugs has on resident care in LTC 
facilities, such as access to health care professionals, timing of a 
resident receiving necessary medications, interruptions in resident 
care, or any other consequences of retaining the current PRN policy for 
anti-psychotic drugs. In addition, we welcome feedback regarding 
alternative policy options that CMS could take to address concerns 
surroundings PRN orders of psychotropic drugs and an explanation of how 
such alternative policy options would provide resident protections, 
without limiting a resident's access to necessary medications. 
Furthermore, we are requesting feedback as to whether the 14-day 
limitation on PRN orders is reasonable, especially in light of the 
proposal to allow a prescriber to extend the order by writing his or 
her rationale in the resident's medical record and indicating the 
duration of the order. If not reasonable, we request that commenters 
provide recommendations to improve these proposed requirements. Lastly, 
we request feedback as to whether there should be a specific 
requirement for evaluating residents before renewing a PRN order for an 
anti-psychotic drug and if so, at what time intervals and what type of 
evaluation should be required?
7. Food and Nutrition Services (Sec.  483.60)
    Dietary standards for residents of LTC facilities are critical to 
both quality of care and quality of life. The October 2016 final rule 
extensively revised the requirements related to food and nutrition 
services, including a burden reducing requirement that allows a 
resident's attending physician to delegate to a qualified dietitian or 
other clinically qualified nutrition professional the task of 
prescribing a resident's diet to the extent allowed by state law. In 
addition, the October 2016 final rule established qualifications for a 
director of food and nutrition services when a dietitian is not 
employed by a facility full-time. Specifically, regulations at Sec.  
483.60(a)(2)(i) state that if a qualified dietitian or other clinically 
qualified nutrition professional is not employed full-time, the 
facility must designate a person to serve as the director of food and 
nutrition services. Under the existing regulations, the director of 
food and nutrition services must be a certified dietary manager; a 
certified food service manager; have similar national certification for 
food service management and safety from a national certifying body; or 
have an associate's or higher degree in food service management or in 
hospitality (if the course study includes food service or restaurant 
management). Individuals designated as the director of food and 
nutrition services prior to November 28, 2016, have 5 years to obtain 
the specified credentials and an individual designated after November 
28, 2016, have 1 year to obtain the specified credentials. Furthermore, 
Sec.  483.60(a)(2)(ii) specifies that the director of food and 
nutrition services could satisfy this requirement if they have met 
applicable state requirements to be a food service manager or dietary 
manager.
    LTC stakeholders have shared concerns regarding the requirement 
that existing staff become certified dietary managers or food service 
managers. Specifically, industry stakeholders have concerns regarding 
the need for existing dietary staff, who are experienced in the duties 
of a dietary manager and currently operate in the position, to now 
obtain new or additional training to become qualified under the 
requirements. We believe that effective management and oversight of the 
food and nutrition service is critical to the safety and well-being of 
all residents of a nursing facility. Therefore, we continue to believe 
that it is important that there are standards for the individuals who 
will lead this service. However, after further consideration of 
stakeholder feedback, we understand that the move from no established 
standards prior to the October 2016 final rule for a director of food 
and nutrition services, to the level of standards established in the 
October 2016 final rule, may have subjected facilities to unnecessary 
burden and increased costs. Furthermore, despite the timeframes built 
into the requirements for existing and newly hired staff to obtain the 
specified credentials, we understand that facilities are concerned 
about a workforce shortage of certified dietary managers and the 
financial costs imposed on existing experienced staff to obtain 
specialized training.
    Therefore, we propose to revise the standards at Sec.  483.60(a)(2) 
to increase flexibility, while providing that the director of food and 
nutrition services is an individual who has the appropriate 
competencies and skills necessary to oversee the functions of the food 
and nutrition services. Specifically, we propose to revise the 
standards at Sec.  483.60(a)(2)(i) and (ii) to provide that at a 
minimum an individual designated as the director of food and nutrition 
services is one who has 2 or more years of experience in the position 
of a director of food and nutrition services or has completed a minimum 
course of study in food safety that includes topics integral to 
managing dietary operations such as, but not limited to, foodborne 
illness, sanitation procedures, and food purchasing/receiving. We are 
retaining the existing requirement at Sec.  483.60(a)(2)(iii) which 
specifies that the director of food and nutrition services must receive 
frequently scheduled consultations from a

[[Page 34745]]

qualified dietitian or other clinically qualified nutrition 
professional. These proposed revisions would maintain established 
standards for the director of food and nutrition services given the 
critical aspects of their job function, while addressing concerns 
related to costs associated with training existing staff and the 
potential need to hire new staff.
8. Administration (Sec.  483.70)
    The existing regulations at Sec.  483.70(e) require each facility 
to conduct and document a facility-wide assessment to determine what 
resources are necessary to care for its residents during both day to-
day operations and emergencies. The facility assessment requirement is 
intended to be used by the facility for multiple purposes, including, 
but not limited to, activities such as determining staffing 
requirements, establishing a QAPI program and conducting emergency 
preparedness planning.
    Currently, the facility must review and update that assessment, as 
necessary, and at least annually. The facility must review and update 
this assessment whenever there is, or the facility plans for, any 
change that would require a substantial modification to any part of 
this assessment. LTC providers are to address in the facility 
assessment the facility's resident population (that is, number of 
residents, overall types of care and staff competencies required by the 
residents, and cultural aspects), resources (for example, equipment, 
and overall personnel), and a facility-based and community-based risk 
assessment.
    We have received feedback from the provider community and other 
stakeholders stating that the facility assessment requirements at Sec.  
483.70(e) are excessively burdensome because they require information 
collection similar, but not identical, to other information collections 
required by the regulations. They stated that these requirements are 
very detailed and that they micro-manage how SNF/NFs must operate their 
businesses. They also stated that complying with existing provisions 
requires an immense amount of administrative time and that this reduces 
valuable leadership time that can be used for resident care. After a 
careful review of the current requirements, we propose to reduce burden 
by removing unnecessary requirements and clarify that data collected 
under the facility assessment requirement can be utilized to inform 
policies and procedures for other LTC requirements. For example, the 
requirements for Nursing services (Sec.  483.35), Behavioral health 
services (Sec.  483.40(a)) and Food and nutrition services (Sec.  
483.60(a)) would all be able to utilize data from the facility 
assessment. In addition, the current QAPI requirement at Sec.  
483.75(c) requires facilities to establish requirements for QAPI 
program feedback, data systems and monitoring. Facilities must maintain 
effective systems to obtain and use feedback and input from direct 
care/direct access workers, other staff, residents, resident 
representatives and families to identify opportunities for improvement. 
The data collected under the QAPI requirement could be used to meet 
portions of the facility assessment requirements and vice versa. Many 
of the health and safety requirements were developed to complement and 
support each other to ensure optimum health and safety for the 
beneficiaries. In addition, we have identified some of the LTC 
requirements that are duplicative of requirements for emergency 
preparedness. LTC facilities are required under Sec.  483.73(a) to 
develop and maintain an emergency preparedness plan that must be based 
on a documented facility-based and community-based risk assessment, 
utilizing an all-hazards approach. The emergency preparedness 
requirements that were effective on November 15, 2016, under Sec.  
483.73(a) also require LTC facilities to conduct a facility and 
community-based risk assessment. The emergency preparedness 
requirements are very detailed and discuss the full range of 
requirements for a facility to have an emergency plan, conduct a risk 
assessment, have policies and procedures, a communication plan, and 
conduct training and testing. As such, we are proposing to remove the 
unnecessary requirement at Sec.  483.70(e)(3) that requires each 
facility to conduct and document a facility-wide assessment for both 
day to-day operations and emergencies.
    The requirements at Sec.  483.70(e)(1) through (2) will remain. We 
are proposing to change the minimum frequency in which a facility 
should conduct a facility assessment under this requirement from an 
annual assessment to a biennial facility-wide assessment. We note that 
this does not preclude facilities from conducting an assessment more 
frequently than every 2 years. We believe that in facilities with a 
high staff turnover, assessments should take place as frequently as 
necessary and the issue should be addressed in the QAPI plan. 
Facilities must present their QAPI plan at each annual recertification 
survey and upon request during any other survey and to CMS upon 
request. The QAPI program must be ongoing, comprehensive, and address 
the full range of care and services provided by the facility and must 
present documentation and evidence of its ongoing QAPI program's 
implementation and the facility's compliance with the program 
requirements. Thus, we believe that the combined LTC requirements (for 
example, emergency preparedness; QAPI; and facility assessment) would 
help to optimize health and safety, while reducing burden. A facility 
would review and update its assessment as necessary, and, at a minimum, 
every 2 years. We believe that this would further reduce burden and 
improve administrative flexibility, especially for rural providers with 
limited resources.
9. Quality Assurance and Performance Improvement Program (Sec.  483.75)
    Section 1128I of the Act, added by section 6102 of the Affordable 
Care Act, requires the Secretary to establish and implement a QAPI 
program for LTC facilities. LTC stakeholders have shared concerns with 
us regarding the prescriptiveness of the QAPI regulations implemented 
in the October 2016 final rule. Specifically, some industry 
stakeholders have indicated that they believe that the QAPI regulations 
are inflexible and too detailed, making it difficult for facilities to 
identify organizational priorities for improvement. However, resident 
advocates indicated that the QAPI process is new in the LTC setting and 
specificity in the requirements is necessary to ensure consistency and 
efficacy of the QAPI process.
    After further consideration and a review of stakeholder feedback, 
we believe that the level of specificity and detail in the QAPI 
requirements, established in the October 2016 final rule, may limit a 
facility's ability to design their QAPI program to fit their individual 
needs and hinder a facility's QAPI program from being a valuable tool 
in promoting quality care. Therefore, we are proposing to revise the 
requirements to allow facilities more flexibility.
    We note that we are not proposing to revise the existing language 
at Sec.  483.75(a)(1) through (4). Section 483.75(a) requires each LTC 
facility, including a facility that is part of a multiunit chain, to 
develop, implement, and maintain an effective, comprehensive, data-
driven QAPI program that focuses on indicators of the outcomes of care 
and quality of life. Regulations at Sec.  483.75(a)(1) through (4) 
specify that facilities must maintain documentation and demonstrate

[[Page 34746]]

evidence of its QAPI program; must present the initial QAPI plan to the 
State Survey Agency no later than 1 year following the promulgation of 
the October 2016 final rule (November 28, 2017); must present the QAPI 
plan at each annual recertification survey and upon request during any 
other survey and to CMS upon request, and lastly must present 
documentation and evidence of its ongoing QAPI program's implementation 
and the facility's compliance with the program requirements to a State 
Survey Agency, federal surveyor, or CMS upon request.
    In response to the FY 2018 SNF PPS proposed rule comment 
solicitation, some commenters indicated that for a QAPI program to meet 
its true intent and be successful, QAPI-related documents should remain 
confidential in all surveys. Commenters indicated that they have 
concerns regarding how the QAPI documents will be used during facility 
surveys and one commenter noted that QAPI-based citations in recent 
surveys have been used as a ``gotcha'' citation instead of focusing on 
true quality outcomes. Commenters noted that requiring facilities to 
disclose their QAPI-related documents limits a facility's ability to 
identify and prioritize what they believe is important and instead 
requires them to monitor everything all the time.
    We are retaining the existing requirements at Sec.  483.75(a)(1) 
through (4) because we believe that these requirements are necessary 
for facilities to demonstrate compliance and to ensure that a 
facility's QAPI program is ongoing. As part of our certification and 
enforcement efforts, we have a responsibility to determine compliance 
through the use of evidence provided by facilities to support 
compliance decisions. Therefore, we note that to avoid the risk of 
facility noncompliance, facilities must be able to provide satisfactory 
evidence that demonstrates compliance with the requirements. 
Furthermore, we expect that any review of QAPI related documents would 
occur at the end of the survey, after completion of investigation into 
all other requirements to ensure that concerns are identified by the 
survey team independent of the QAPI document review. We encourage 
readers to refer to the interpretive guidelines for the October 2016 
final rule for a full discussion regarding disclosure of information 
and good faith attempts (https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/som107ap_pp_guidelines_ltcf.pdf).
    We are proposing revisions to Sec.  483.75(b), (c), and (d) that 
would remove the subparagraphs found in each section. Specifically, 
regulations at Sec.  483.75(b) sets forth parameters for a facility's 
QAPI program design and scope. We propose to maintain only the 
introductory text at Sec.  483.75(b), which requires that the QAPI 
program be ongoing, comprehensive, and address the full range of care 
and services provided by the facility, and to remove the detailed 
requirements at Sec.  483.75(b)(1) through (4).
    Regulations at Sec.  483.75(c) set forth specific requirements for 
program feedback, data systems and monitoring. We propose to maintain 
only the introductory text at Sec.  483.75(c), which requires that 
facilities establish and implement written policies and procedures for 
feedback, data collection systems, and monitoring, including adverse 
event monitoring, and remove the detailed requirements at Sec.  
483.75(c)(1) through (4).
    Regulations at Sec.  483.75(d) set forth specific requirements for 
program systematic analysis and systemic action. We propose to maintain 
Sec.  483.75(d)(1), which requires facilities to take actions aimed at 
performance improvement and, after implementing those actions, measure 
its success, and track performance to ensure that improvements are 
realized and sustained, and remove the detailed requirements for 
policies at Sec.  483.75(d)(2).
    We believe that these proposed revisions recognize the diversity 
throughout LTC facilities and would reduce burden on facilities by 
allowing facilities greater flexibility in tailoring their QAPI 
programs to the specific needs of the facility. In addition, the 
proposed requirements for the QAPI program would be consistent with the 
QAPI requirements for other Medicare and Medicaid participating 
providers, such as hospitals and other major inpatient provider types.
10. Infection Control (Sec.  483.80)
    Section 483.80 requires LTC facilities to, among other things, 
establish and maintain an infection prevention and control program 
(IPCP) designed to provide a safe, sanitary, and comfortable 
environment and to help prevent the development and transmission of 
communicable diseases and infections. Each facility must conduct an 
annual review of its IPCP and update its program, as necessary (Sec.  
483.80(f)).
    Currently, each facility must designate one or more individual(s) 
as infection preventionists (IPs) who are responsible for the 
facility's IPCP. The IP must--(1) have primary professional training in 
nursing, medical technology, microbiology, epidemiology, or other 
related field; (2) be qualified by education, training, experience or 
certification; (3) work at least part-time at the facility; and, (4) 
have completed specialized training in infection prevention and 
control. The IP must also be a member of the facility's quality 
assessment and assurance committee.
    Some commenters expressed concern about the burden to providers in 
complying with these requirements, especially the requirements 
regarding the IPs. However, we received feedback about how important 
the new requirements are to improving infection prevention and control 
in LTC facilities. Infection is the leading cause of morbidity and 
mortality among the 1.7 million residents of United States nursing 
homes. Between 1.6 and 3.8 million infections occur each year in these 
nursing homes, with almost 388,000 deaths attributed to these 
infections. Significant costs are associated with infections in nursing 
homes, with estimates ranging from $673 million to $2 billion. An 
average of 15 percent of nursing homes from 2000 to 2007 received a 
deficiency citation regarding the infection control requirements 
(``Nursing home deficiency citations for infection control,'' Am J 
Infect Control. 2011 May; 39(4): 263-9). Most of these citations were 
at the D level, which means that they were isolated cases but 
represented a potential to do more than minimal harm. The infection 
prevention and control requirements must recognize the serious risks 
from infectious organisms in LTC facilities without imposing excessive 
administrative burden on these facilities that will not provide any 
commensurate improvement in the quality of care provided to residents. 
Based upon these facts and the feedback we have received regarding the 
importance of the infection prevention and control requirements in the 
LTC facility requirements, we believe that the requirements in the 2016 
final rule should be retained. However, we are proposing one change to 
these requirements.
    We believe it is essential that the facility's IP(s) have 
sufficient time to devote to the IPCP to ensure that he or she can 
achieve the objectives set forth in the facility's IPCP. As set forth 
in Sec.  483.80(a)(1), the facility must use the facility assessment 
conducted according to Sec.  483.70(e) in developing its IPCP. Thus, 
the time necessary for an IP to devote to the facility's IPCP will vary 
between facilities. Currently, Sec.  483.80(B)(3) requires the IP to 
work at least part-time at the facility. Part-time could be interpreted 
in various ways

[[Page 34747]]

and could result in confusion. In addition, depending upon the 
facility's IPCP, IPs might need to devote only a few hours to the IPCP 
or it might take one or more IPs full-time. Therefore, we are proposing 
to remove the requirement that the IP work at the facility ``at least 
part-time'' and insert that the IP must have sufficient time at the 
facility to meet the objective's set forth in the facility's IPCP. We 
believe this is an appropriate standard. However, we are also concerned 
that there could be a substantial variance in how LTC facilities 
interpret this requirement. Therefore, we are soliciting comments on 
how should it be determined that the IP has sufficient time to devote 
to the IPCP to ensure that he or she can achieve the objectives set 
forth in the facility's IPCP. Please be specific.
11. Compliance and Ethics Program (Sec.  483.85)
    Section 483.85(d)(1)--Additional required components for operating 
organizations with five or more facilities; 483.85(e)--Annual review; 
Compliance and ethics--Sec.  483.95(f)(2).
    Section 1128I of the Act requires the operating organizations for 
SNFs and NFs to have in operation a compliance and ethics program that 
is effective in preventing and detecting criminal, civil, and 
administrative violations under the Act and in promoting quality of 
care consistent with regulations developed by the Secretary. In the 
final rule published on October 4, 2016, we finalized this requirement 
along with additional training and personnel requirement that were not 
expressly required in the statute. However, after a review of these 
requirements, we are proposing to reduce a majority of the burden 
currently required under the compliance and ethics program that are not 
required in the statute because we believe that the SNF and NF CoPs 
would have the appropriate safety and quality standards to support the 
compliance and ethics requirements with the proposed changes. Thus we 
propose to remove the following requirements:
     We propose to remove the requirement that each facility 
designate a compliance officer and a designated compliance liaison for 
operating organizations with five or more facilities. Instead, we would 
propose that such organizations develop a compliance and ethics program 
that is appropriate for the complexity of the organization and its 
facilities and that each facility assign a specific individual within 
the high-level personnel of the operating organization with the overall 
responsibility to oversee compliance.
     Based on feedback from the industry and stakeholders that 
the frequency requirement is overly burdensome, we propose to remove 
the annual review requirement and propose that each organization 
undertake a periodic assessment of its compliance program to identify 
any necessary changes. This proposed change would conform to the 
statutory requirement.
     We propose to eliminate the requirement for a ``compliance 
and ethics program contact person'' to which individuals may report 
suspected violations. However, we maintain that is important for 
individuals to report suspected violations, we will not specify the 
staff person for this task. Facilities must have a process to 
accomplish this and we don't want to dictate who they should hire to 
comply with this requirement. We will maintain the requirement that 
facilities should have an alternate method of reporting suspected 
violations anonymously. We would expect the facility to have sufficient 
resources and designate an individual that would have the appropriate 
authority to assure compliance with the requirements.
     We propose that the operating organization for each 
facility develop, implement, and maintain an effective compliance and 
ethics program that contains, at a minimum, established written 
compliance and ethics standards, policies, and procedures that are 
reasonably capable of reducing the prospect of criminal, civil, and 
administrative violations under the Act.
    We also propose that specific high-level personnel of the operating 
organization be assigned the overall responsibility to oversee 
compliance with the operating organization's compliance and ethics 
program's standards, policies, and procedures. We propose to remove the 
statement in the regulation at Sec.  483.85(c)(2) that states ``such 
as, but not limited to, the chief executive officer (CEO), members of 
the board of directors, or directors of major divisions in the 
operating organization could be assigned to oversee compliance.'' We 
are proposing to remove this prescriptive language and would, instead, 
hold facilities responsible for the effective operation of its program. 
For additional guidance, we note that the Department of Health and 
Human Services' Office of the Inspector General (OIG) has issued 
industry-specific guidance documents in the March 16, 2000 Federal 
Register (65 FR 14289) entitled ``Publication Of The OIG Compliance 
Program Guidance For Nursing Facilities'', and in the September 30, 
2008 Federal Register (73 FR 56832) ``OIG Supplemental Compliance 
Program Guidance For Nursing Facilities.'' The guidance reiterates the 
basic elements of a compliance and ethics program. It should be the 
responsibility of the facility to designate an appropriate person to be 
responsible for all aspects of the compliance and ethics program.
    We would expect that the facility would give designated individuals 
sufficient resources and authority to reasonably assure compliance with 
the program's standards, policies, and procedures. The facility should 
not delegate substantial discretionary authority to individuals whom 
the operating organization knows (or should have known through the 
exercise of due diligence) had a propensity to engage in criminal, 
civil, and administrative violations under the Act.
    We propose that the facility effectively communicate the standards, 
policies, and procedures in the operating organization's compliance and 
ethics program to the operating organization's entire staff; 
individuals providing services under a contractual arrangement; and 
volunteers, consistent with the volunteers' expected roles. 
Requirements would include, but are not limited to, mandatory 
participation in training as set forth in Sec.  483.95(f) or 
orientation programs, or disseminating information that explains in a 
practical manner what is required under the program. Also, the facility 
should take reasonable steps to achieve compliance with the program's 
standards, policies, and procedures. Such steps would include, but not 
be limited to, utilizing monitoring and auditing systems reasonably 
designed to detect criminal, civil, and administrative violations under 
the Act by any of the operating organization's staff, individuals 
providing services under a contractual arrangement, or volunteers, 
having in place and publicizing a reporting system whereby any of these 
individuals could report violations by others within the operating 
organization without fear of retribution.
    The compliance and ethics program contact identified in the 
operating organization's compliance and ethics program would be 
required to ensure consistent enforcement of the operating 
organization's standards, policies, and procedures through appropriate 
disciplinary mechanisms, including, as appropriate, discipline of 
individuals responsible for the failure to detect and report a 
violation.
    After a violation is detected, the operating organization would 
have to ensure that all reasonable steps

[[Page 34748]]

identified in its program were taken to respond appropriately to the 
violation and to prevent further similar violations, including any 
necessary modification to the operating organization's program to 
prevent and detect criminal, civil, and administrative violations under 
the Act.
    In addition to the listed requirements, operating organizations 
that operate five or more facilities and facilities with corporate 
level management of multi-unit nursing home chains would have to:
     Have a more formal program that included established 
written policies defining the standards and procedures to be followed 
by its employees.
     Develop a compliance and ethics program that was 
appropriate for the complexity of the operating organization and its 
facilities.
    We are proposing to revise Sec.  483.85(e) to require the operating 
organization for each facility to periodically review and revise its 
compliance program to identify necessary changes within the 
organization and its facilities.
12. Physical Environment (Sec.  483.90)
a. Life Safety Code
    On May 4, 2016, we published a final rule, ``Medicare and Medicaid; 
Fire Safety Requirements for Certain Health Care Facilities,'' adopting 
the 2012 edition of the National Fire Protection Association (NFPA) 101 
(81 FR 26871), also known as the Life Safety Code (LSC). One of the 
mandatory references in the LSC is NFPA 101A, Guide on Alternative 
Approaches to Life Safety, also known as the Fire Safety Equivalency 
System (FSES). On December 16, 2016, CMS issued a survey & 
certification memo (S & C 17-15-LSC) updating to the newer edition of 
the NFPA 101A FSES. However, when we updated to the newer FSES that is 
part of the recently adopted 2012 LSC, some LTC facilities that 
utilized the FSES in order to determine compliance with the 
containment, extinguishment and people movement requirements of the LSC 
were no longer able to achieve a passing score, on the FSES, because of 
the change in scoring. When adopting the 2012 edition of the LSC and 
its FSES scoring values we did not anticipate this outcome. 
Additionally, during the public comment period for the proposed rule 
(79 FR 21551) we did not receive any public comments to indicate that 
this would be problematic for certain LTC facilities. Some existing LTC 
facilities were previously built with wood frame or unprotected steel 
construction with less than 2 hours of fire rated protection and are 3 
or more stories in height. These facilities are fully sprinklered in 
order to meet both the LTC regulations at Sec.  483.90(a)(6), and the 
LSC requirements. However, in order to score high enough to meet the 
FSES standards that are part of the 2012 edition of the LSC, these 
particular facilities would have to improve their construction type to 
one that is at least 2 hours of fire rated protection. Changing the 
construction type from being less than 2 hours of fire rated protection 
to being at least 2 hours of fire rated protection is extremely 
burdensome because such construction would completely disrupt the 
operation of the facility for a substantial period of time. In addition 
to the quality of care impacts and the financial impacts of service 
disruptions upon affected facilities in the form of lost revenues of 
such service disruptions, the significant cost of completing such 
construction, which we estimate to be $4.75 million per typical 
affected LTC facility, is likely to result in some permanent facility 
closures. We believe this would create access to care problems for 
affected residents and their surrounding communities, in addition to 
financial hardships for facility owners and staff. In light of the fact 
that we were not aware of this problem ahead of time, we did not allow 
for a regulatory phase-in period. However, the S & C 17-15-LSC memo 
from December 16, 2016 does allow for facilities to have immediate 
relief by applying for a time-limited waiver of up to 5 years while we 
pursue a long-term solution. We believe that there is a need for 
regulatory relief.
    In order to address this need, we propose to allow those existing 
LTC facilities (those that were Medicare or Medicaid certified before 
July 5, 2016) that have previously used the FSES to determine 
equivalent fire protection levels, to continue to use the 2001 FSES 
mandatory values when determining compliance for containment, 
extinguishment and people movement requirements. Allowing the use of 
the 2001 FSES scoring values would continue to provide the same amount 
of safety for residents and staff as has been provided since we began 
implementing the 2001 FSES in 2003. This would allow existing LTC 
facilities that previously met the FSES requirements to continue to do 
so without incurring great expense to change construction type. Based 
on a review by the states and regional offices, we estimate that there 
are 50 existing LTC facilities that would no longer be able to achieve 
a passing score on the new FSES requirements. This is an estimate based 
on feedback from facilities, states, and CMS Regional Offices. We are 
proposing to use the following mandatory scoring values:
[GRAPHIC] [TIFF OMITTED] TP18JY19.027

    We would set out this table at Sec.  483.90(a)(1)(iii).
b. Resident Rooms and Bathrooms
    The physical environment of a nursing facility is integral to the 
resident's health and safety. Therefore, the facility must be designed, 
constructed, equipped, and maintained to protect the health and safety 
of

[[Page 34749]]

residents, personnel, and the public. The October 2016 final rule 
implemented new physical environment requirements at Sec.  483.90 
related to space and accommodations within facilities. Specifically, 
regulations at Sec.  483.90(e)(1)(i) require newly constructed, re-
constructed, or facilities first certified after November 28, 2016 (the 
effective of Phase One of the October 2016 final rule) to accommodate 
no more than two residents in a bedroom. Regulations at Sec.  483.90(f) 
require newly constructed and facilities first certified after November 
28, 2016 to equip each resident room with its own bathroom that has a 
commode and sink.
    The October 2016 final rule responded to commenters' concerns that 
the proposed rule was too burdensome; however, industry stakeholders 
have continued to share concerns regarding the burden associated with 
these requirements, specifically noting that the requirements 
discourage building, remodeling, upgrading, and the purchasing of 
facilities. We recognize these concerns and unintended consequences. 
However, we continue to believe that the finalized physical environment 
requirements address valid health and safety concerns. Specifically, we 
believe that more than two residents to a room not only infringes on a 
resident's privacy and dignity, but also creates issues related to 
infection control and resident safety. Likewise, we believe that rooms 
without bathrooms increase risks related to falls, quality of care, and 
infection control.
    Therefore, we are not proposing to entirely remove these 
requirements. We are proposing to revise Sec.  483.90(e)(1)(i) 
regarding the number of residents per room and Sec.  483.90(f) 
regarding bathroom facilities, to apply only to newly constructed 
facilities and newly certified facilities that have never previously 
been a long-term care facility. We believe that these revisions would 
reduce burden by removing any unintended disincentives to purchase or 
upgrade existing facilities, while ensuring that any new facilities 
(either newly constructed or converted into a nursing home) are 
properly equipped to accommodate residents in a reasonable and safe 
manner. However, we note that when purchasing or updating facilities, 
this may create an opportune time to update facility rooms and 
bathrooms in an effort to address infection risks and quality of life 
concerns. For example, when providing care for residents during a 
norovirus outbreak, having sinks in resident rooms would allow staff 
easier access to wash their hands and conduct effective infection 
prevention and control practices to avoid further contamination. 
Therefore, we are soliciting comments as to whether it would be 
appropriate to sunset the exception we propose to provide for buildings 
that were previously long-term care facilities. If so, what would be a 
reasonable time frame for sunsetting this exemption to balance the 
needs of residents for privacy, quality of life, and infection 
prevention and the desire to maintain access to facilities and avoid 
the unintended consequences discussed previously.
13. Technical Corrections
Admission, Transfer, and Discharge Rights Sec.  483.15
    Section 483.15 includes an incorrect cross-reference. Specifically, 
Sec.  483.15(c)(1)(ii) includes an incorrect cross-reference to Sec.  
431.220(a)(3). We propose to revise Sec.  483.15(c)(1)(ii) to correct 
the cross reference by replacing ``Sec.  431.220(a)(3)'' with ``Sec.  
431.220(a)(2)''.
Nursing Services Sec.  483.35
    Section 483.35 includes incorrect cross-references. Specifically, 
Sec.  483.35(a)(2) and Sec.  483.35(e)(4) include incorrect cross-
references to paragraph (c) of this section. In addition, Sec.  
483.35(f)(2) includes an incorrect cross-reference to paragraph (d)(1) 
of this section. We propose to revise Sec.  483.35 to correct the cross 
references by replacing ``paragraph (c)'' with ``paragraph (e)'' in 
Sec.  483.35(a)(2) and (e)(4) and replacing ``paragraph (d)(1)'' with 
``paragraph (f)(1)'' in Sec.  483.35(f)(2).
Physical Environment Sec.  483.90(d)
    On July 13, 2017, we issued a correcting amendment, ``Medicare and 
Medicaid Programs; Reform of Requirements for Long-Term Care 
Facilities'' (82 FR 32256) to correct technical and typographical 
errors identified in the October 4, 2016 final rule. This document 
inadvertently removed revisions made to Sec.  483.90(d), which were 
finalized in the October 2016 final rule. Specifically, the October 
2016 rule finalized requirements at Sec.  483.90(d) (incorrectly 
labeled paragraph (c) in the October 2016 final rule) for facilities 
to--(1) provide sufficient space and equipment in dining, health 
services, recreation, living, and program areas to enable staff to 
provide residents with needed services as required by these standards 
and as identified in each resident's assessment and plan of care at 
Sec.  483.90(d)(1)); (2) maintain all mechanical, electrical, and 
patient care equipment in safe operating condition at Sec.  
483.90(d)(2); and (3) conduct regular inspection of all bed frames, 
mattresses, and bed rails, if any, as part of a regular maintenance 
program to identify areas of possible entrapment. When bed rails and 
mattresses are used and purchased separately from the bed frame, the 
facility must ensure that the bed rails, mattress, and bed frame are 
compatible at Sec.  483.90(d)(3).
    We discussed the revisions in Sec.  483.90(d) in the October 2016 
final rule, responded to public comments related to this issue, and 
concluded that we were finalizing the requirement (see 81 FR 68817). 
Therefore, we are proposing to correct the error in the Code of Federal 
Register to revise Sec.  483.90(d)(1) and to add Sec.  483.90(d)(3).
Diagnostic X Ray Tests, Diagnostic Laboratory Tests, and Other 
Diagnostic Tests: Condition (Sec.  410.32)
    Section 410.32 includes an incorrect cross-reference to Part 483. 
Specifically, Sec.  410.32(d)(1)(vii) includes an incorrect cross-
reference to Sec.  483.75(k)(1)(i). We propose to revise Sec.  
410.32(d)(1)(vii) to correct the cross reference by replacing ``Sec.  
483.75(k)(1)(i)'' with ``Sec.  483.50(a)(1)(i)''.

B. Survey, Certification, and Enforcement Procedures

1. Informal Dispute Resolution (IDR) (Sec.  488.331) and Independent 
Informal Dispute Resolution (Sec.  488.431)
    To assess compliance with the LTC requirements, surveyors conduct 
onsite inspections (surveys) of facilities. In the survey process, 
surveyors directly observe the actual provision of care and services to 
residents and the effect or possible effects of that care to assess 
whether the care provided meets the assessed needs of individual 
residents.
    Among the statutory enforcement remedies available to the Secretary 
and the states to address facility noncompliance are CMPs, authorized 
by sections 1819(h) and 1919(h) of the Act. CMPs may be imposed for 
each day or each instance of facility noncompliance, as well as for 
past instances of noncompliance even if a facility is in compliance at 
the time of the current survey. The regulations that govern the 
enforcement remedies authorized by the statute, were published in the 
Federal Register on November 10, 1994 (59 FR 56116).
    Facilities that are dissatisfied with a certification of 
noncompliance have an informal opportunity, if they request it, to 
dispute cited deficiencies upon receipt of the official statement of 
deficiencies. For surveys conducted pursuant to section 1864 of the 
Act, this informal dispute resolution (IDR)

[[Page 34750]]

process is provided by the state. The requirement for IDR is specified 
at Sec.  488.331. Policy guidance in section 7212 of CMS's State 
Operations Manual (Pub. 100-07) (SOM) specifies the mandatory elements 
that must be included in each State's IDR process. There is no 
specification for how long the IDR process should take to be completed. 
We are proposing to add language to specify that IDR would be completed 
within 60 days of the facility's request to dispute the survey findings 
if the request by the facility is timely. This is consistent with the 
time frame for the completion of an Independent IDR.
    NFs and dually-participating SNF/NFs are provided the opportunity 
to request and participate in an Independent IDR if CMS imposes CMPs 
against the facility. The requirement for Independent IDR is specified 
at Sec.  488.331. Policy guidance in section 7213 of CMS's SOM 
specifies the mandatory elements that must be included in each State's 
Independent IDR process. Current guidance in the SOM at 7212.3 and 
7213.9 specify that the results of a survey should not be uploaded to 
the Certification and Survey Provider Enhanced Reports (CASPER) system 
before the resolution of the IDR or the Independent IDR. We are 
proposing to add this language in regulation as we have been made aware 
that these instructions are not always being followed; and entering the 
survey results before the dispute processes have been completed may 
negatively affect a facility's Five Star quality rating on Nursing Home 
Compare.
    Current guidance in the SOM at 7213.6 specifies the qualifications 
of an approved Independent IDR reviewer (entity or person). One of the 
qualifications is a specific understanding of Medicare and Medicaid 
program requirements. While this is specified in regulation regarding 
an independent entity, it is not specified in the example given of a 
component of an umbrella State agency that is separate from the SA. In 
order to clarify that this is indeed a requirement for the component, 
we are proposing to add language to the regulation.
    Note: State health agencies are either independent agencies or a 
unit of a larger agency, often referred to as an umbrella agency.
    Finally, as outlined in current sub-regulatory guidance when an 
outside entity conducts the Independent IDR process based on the 
results of a state-conducted or federally-conducted survey, the results 
serve only as a recommendation of noncompliance or compliance to the 
State or CMS. If the State or CMS disagrees with the Independent IDR 
recommendation, the written record provided to the facility will 
contain the result of each deficiency challenged and a summary of the 
rationale for that result so that the facility understands the 
Independent IDR panel's recommendation and why the State or CMS do not 
agree with that recommendation.
    Current SOM guidance provides instruction regarding what should be 
provided to the facilities as part of the written record but CMS has 
been made aware that the facility is sometimes only receiving the final 
decision and no rationale is included for the decision, which leads to 
confusion as to why an Independent IDR recommendation is not followed. 
We are proposing to add this language in regulation to strengthen this 
requirement.
    Based on stakeholder input, we propose that additional language be 
added to the CMS enforcement regulations at Sec.  488.331 and Sec.  
488.431 to clarify and strengthen regulations and provide more specific 
requirements to states and CMS regarding both the IDR process and the 
Independent IDR processes. We would--(1) specify that an IDR process 
must be completed within the same timeframe that we specify for the 
Independent IDR process; (2) provide states with more specific 
instructions on when the results of a survey should be transferred for 
inclusion in the national reporting system; (3) clarify the knowledge 
required by an approved independent entity; and (4) specify that the 
final result of an Independent IDR (including the rationale behind the 
decision) must be relayed to a facility by either the state or CMS in 
writing. We discuss these proposed revisions and invite public comment 
on the proposed changes.
    We proposed to revise Sec.  488.331(b)(1) by adding new language to 
specify that the IDR process shall be completed within 60 days of the 
facility's request to dispute the survey findings if the request by the 
facility is timely. In order to reduce confusion and ensure consistency 
between the IDR and Independent IDR processes, we are requiring the 
same time frame for completion for both processes. In the case where a 
CMP is imposed, facilities disputing the survey results are still 
required to pay the CMP and it is held in an escrow account until a 
final administrative decision has been made. Specifying the time frame 
for the completion of the IDR process will potentially reduce burden on 
facilities who will have the money returned to them sooner when they 
are successful in their appeal.
    At proposed Sec.  488.331(b)(2), we propose to add specific 
instructions to states explaining when survey results should be 
uploaded into the CASPER system. These survey results are used to 
calculate a facility's Five-Star quality rating on the Nursing Home 
Compare website and are not to be uploaded into CASPER before the 
resolution of the IDR or Independent IDR processes. This specification 
will provide consistency to the upload process and prevent survey 
results from being uploaded prior to completion of the dispute process. 
Recognizing that the public as well as other organizations, use Nursing 
Home Compare to assist in decision-making about residing or contracting 
with a specific facility, this will reduce burden on providers by 
ensuring that the CMS website contains accurate survey information that 
includes any post-survey review through the IDR or Independent IDR 
process. It would also reduce burden on states by minimizing the amount 
of corrections and changes to data that would need to be made if 
information were uploaded prematurely.
    At Sec.  488.431(a)(2), we propose to add new language to specify 
that the facility must receive written notification of the results of 
the Independent IDR, including the rationale for the final decision. 
The rationale must be provided by CMS or the states depending upon who 
made the final determination. Although SOM guidance instructs states 
and CMS to send written notification of the Independent IDR 
recommendation to the facility, there may be times when the state or 
CMS disagrees with the Independent IDR entity's recommendation and it 
is not accepted as the final decision. In this case, the rationale for 
the disagreement must be documented by CMS or the state as part of 
their normal process and provided to the facility to ensure clarity in 
why a final decision was made that differs from the Independent IDR's 
recommendation. This would reduce burden on facilities as, adding this 
to regulation, they would be made aware of the availability of this 
information and would not have to spend time trying to figure out the 
process for requesting an explanation of the final decision.
    At Sec.  488.431(a)(4)(i), we propose to add language to clarify 
that, in order to be approved to conduct an Independent IDR, a 
component of an umbrella state agency must have a specific 
understanding of Medicare and Medicaid program requirements. Although 
this information is provided in guidance, including it in regulation 
will strengthen this provision. In

[[Page 34751]]

addition, it will reduce burden by decreasing the possibility of 
providers having to dispute the qualifications of the entity chosen to 
conduct the Independent IDR process and/or its recommendations.
2. Civil Money Penalties: Waiver of Hearing, Reduction of Penalty 
Amount (Sec.  488.436)
    Requirements at Sec.  488.436 regarding the option for a facility 
to waive hearing rights and receive a 35 percent reduction in the 
amount of CMPs owed were first adopted in a 1994 final rule (59 FR 
56116-01), with minor corrections to the text in 1997 (62 FR 44221). 
Over the years, we have observed that most facilities facing CMPs do 
not request a hearing to appeal the survey findings of noncompliance on 
which their CMPs are based. In CY 2016, 81 percent of LTC facilities 
submitted a written waiver of the hearing and an additional 15 percent 
of facilities failed to submit a waiver although they did not contest 
the penalty and its basis. Only 4 percent of facilities availed 
themselves of the full hearing process. Therefore, based on our 
experience with LTC facilities facing CMPs and the input provided by 
CMS Regional Offices who impose and collect CMPs, we propose to revise 
these requirements at Sec.  488.436 by creating a constructive waiver 
process that would produce the same, or better, results for less money 
and effort.
    Specifically, we propose to revise the current express waiver 
process to one that seamlessly flows to a constructive waiver and 
retains the accompanying 35 percent penalty reduction. This would 
result in lower costs for most LTC facilities facing CMPs and would 
streamline and reduce the administrative burden for all stakeholders.
    We propose to amend the language at Sec.  488.436(a), by 
eliminating the requirement to file a written waiver and create in its 
place a constructive waiver process that would operate by default when 
CMS has not received a timely request for a hearing. Facilities that 
wish to request a hearing would continue to follow all other appeals 
process requirements, including those at Sec.  498.40, as currently 
referenced in part 488 at Sec.  488.431(d).
    We propose language at Sec.  488.436(a) stating that a facility is 
deemed to have waived its rights to a hearing if the time period for 
requesting a hearing has expired and CMS has not received a timely 
request for a hearing. For the 81 percent of LTC facilities that submit 
a written hearing waiver and receive a 35 percent reduction in the 
amount of their CMPs, these facilities must then pay the amount due 
(minus the 35 percent reduction). We have observed that many facilities 
submitting a request for a waiver of hearing wait until close to the 
end of the 60-day timeframe within which a waiver must be submitted, 
thus delaying the ultimate due date of the CMP amount. For these 
reasons, we believe the constructive waiver process would meet the 
needs of most facilities facing CMPs.
    We believe that other circumstances can be addressed under Sec.  
488.444, whereby CMS has authority to settle CMP cases at any time 
prior to a final administrative decision for Medicare-only SNFs, state-
operated facilities, or other facilities for which CMS' enforcement 
action prevails, in accordance with Sec.  488.30. We believe that 
eliminating the current requirements at Sec.  488.436 for a written 
waiver will not negatively impact facilities, and as such, we 
especially welcome comments from the public addressing any potential 
circumstances in which facilities' needs could best be met or only be 
met by the use of an express, written waiver.
    In addition to the changes to Sec.  488.436(a), we propose 
corresponding changes to Sec.  488.432 and Sec.  488.442 which now 
reference only the written waiver process. Finally, we note that the 
current requirements at Sec.  488.436(b) would remain unchanged.
3. Phase 3 Implementation of Overlapping Regulatory Provision
    The revised LTC requirements for participation are being 
implemented in three phases. Phases 1 and 2 were implemented in 
November of 2016 and 2017 respectively. Phase 3 includes additional 
regulatory provisions that are scheduled to be implemented on November 
28, 2019. Each phase requires a significant level of activities, 
including interpretive guidance drafting and publication, provider 
education, software development, and surveyor training.
    Of the Phase 3 provisions, this regulation proposes revisions that, 
if finalized, would have an impact on provisions that fall into three 
primary areas--(1) designation and training of the infection 
preventionist (Sec.  483.80), Quality Assurance and Performance 
Improvement (QAPI) (Sec.  483.75), and compliance and ethics program 
(Sec.  483.85). We list the specific regulatory citations in table 2 
that follows.

[[Page 34752]]

[GRAPHIC] [TIFF OMITTED] TP18JY19.028

    We are proposing to delay implementation of the above regulatory 
sections except for the requirements related to the Infection 
Preventionist at Sec.  483.80(b)(1) through (4) and (c) and Sec.  
483.75(g)(1)(iv) (participation of Infection Preventionist on the 
quality assessment and assurance committee). We do not propose to delay 
the implementation of the infection preventionist requirements because 
the reduction in burden is related to the time required onsite. The 
requirements related to the infection preventionist's required training 
and role remain unchanged, and we therefore believe this requirement 
can be implemented as scheduled. For those requirements that we propose 
to delay implementation, we propose to implement them one year after 
the effective date of the finalization of this rule.
    The purpose of this delay is to avoid unnecessary work, confusion 
and burden associated with implementing provisions that are proposed to 
be changed in this rule. We understand potential concerns regarding 
further delaying the implementation of the QAPI and compliance and 
ethics requirements, as these provisions were required to be 
implemented by statute in 2012 and 2013 respectively. However, we 
believe that moving forward with implementing these provisions in 
November 2019, only to implement significant revisions to the 
provisions proposed in this rule, would create significant additional 
work and confusion for the nursing home community. In addition, this 
would create administrative burden to Regions and States in software 
changes and surveyor re-training.

III. Collection of Information Requirements

    Under the Paperwork Reduction Act of 1995, we are required to 
provide 60-day notice in the Federal Register and solicit public 
comment before a collection of information requirement is submitted to 
the Office of Management and Budget (OMB) for review and approval. In 
order to fairly evaluate whether an information collection should be 
approved by OMB, section 3506(c)(2)(A) of the Paperwork Reduction Act 
of 1995 requires that we solicit comment on the following issues:
     The need for the information collection and its usefulness 
in carrying out the proper functions of our agency.
     The accuracy of our estimate of the information collection 
burden.
     The quality, utility, and clarity of the information to be 
collected.
     Recommendations to minimize the information collection 
burden on the affected public, including automated collection 
techniques.
    In analyzing information collection costs, we rely heavily on wage 
and salary information. Unless otherwise indicated, we obtained all 
salary information from the May 2017 National Occupational Employment 
and Wage Estimates, United States by the Bureau

[[Page 34753]]

of Labor Statistics (BLS) at https://www.bls.gov/oes/current/oes_nat.htm. Furthermore, where applicable, the wage information for 
each occupation were pulled from the BLS industry category ``nursing 
care facilities (skilled nursing facilities). Based on this 
information, we have calculated the estimated hourly rates in this 
proposed rule based upon the national mean salary for that particular 
position increased by 100 percent to account for overhead costs and 
fringe benefits. The raw wage and salary data from the BLS do not 
include health, retirement, and other fringe benefits, or the rent, 
utilities, information technology, administrative, and other types of 
overhead costs supporting each employee. HHS department-wide guidance 
on preparation of regulatory and paperwork burden estimates states that 
doubling salary costs is a good approximation to these overhead and 
fringe benefit costs.
    The table that follows presents the BLS occupation code and title, 
the associated LTC facility staff position in this regulation, the 
estimated average hourly wage, and the adjusted hourly wage (with a 100 
percent markup of the salary to include fringe benefits and overhead 
costs).
[GRAPHIC] [TIFF OMITTED] TP18JY19.029

    This proposed rule does not impose any new information collection, 
recordkeeping or third-party disclosure requirements. However, this 
proposed rule would create certain savings related to information 
collection, recordkeeping or third-party disclosure requirements. While 
we detail all of the estimated savings of this proposed rule in the 
regulatory impact analysis, this section provides a brief summary of 
the estimated savings associated with the information collection 
request (ICR) for LTC requirements (0938-1363) which will be sent to 
OMB for review. We are soliciting public comment on each of these 
issues for the following sections of this document that contain ICRs.

Requirements for Participation

1. ICRs Regarding Resident Rights (Sec.  483.10)
    We propose several revisions to the regulations at Sec.  483.10(j) 
that require facilities to develop a grievance policy. Proposed 
revisions include removing duplicative requirements, clarifying that 
everyday feedback may not rise to the level of an official grievance, 
removing

[[Page 34754]]

the requirement for facilities to designate a grievance official, 
remove prescriptive requirements related to written grievance 
decisions, and reducing the requirement for facilities to retain 
evidence demonstrating the results of grievances from 3 years to 18 
months. Based on these proposals, we believe that there may be minor 
information collection cost reductions for developing a grievance 
policy. However, we believe that the majority of the cost savings are 
included in the proposal to remove the requirement for the grievance 
official to oversee the grievance process. We discuss these cost 
savings in the Regulatory Impact Analysis section.
2. ICRs Regarding Freedom, Abuse, Neglect, and Exploitation (Sec.  
483.12)
    The proposed revisions to the reporting requirements for abuse 
provide flexibility around the timeframes for reporting, but do not 
eliminate any of the reporting requirements. Therefore, while we 
believe the proposed revisions address stakeholder concerns and provide 
flexibility, the proposed revisions will have negligible effects on 
information collection costs.
3. ICRs Regarding Admission, Transfer, and Discharge Rights (Sec.  
483.15)
    We propose to revise the requirement for facilities to send copies 
of transfer or discharge notices to the Office of the State Long-Term 
Care Ombudsman to apply specifically to involuntary transfers or 
discharges only. In the October 2016 final rule we indicated that this 
cost would apply primarily to residents who are involuntarily 
discharged from the facility and does not include residents who request 
the transfer or who are transferred on an emergency basis to an acute 
care facility. Based on these assumptions, we estimated that the 
requirement would apply to one third of all LTC facility residents 
resulting in a cost of $1,340,936 related to make a copy of the notice, 
apply postage (if mailed), and the time of an office assistant to 
prepare and send the notice.
    The proposed revisions would clearly establish the expectation that 
this requirement would apply to involuntary transfers or discharges 
only. Based on stakeholder comments, while we previously estimated that 
the requirement would apply to only one third of all LTC residents, 
many facilities have been sending the notice with all discharges and 
transfers rather than only involuntary discharges and transfers. 
Therefore, we estimate that the existing requirement applies to two 
thirds of all residents resulting in an updated estimated cost of 
$2,946,095 ($.10 (cost to make a copy per notice) + $.63 (cost for pre-
stamped envelope based on USPS retail) + $2.58 (5/60 of an office 
assistant $31 hourly wage) x 889,163 (\2/3\ of 1,333,745 LTC 
residents)). We estimate further that with the proposed revisions, this 
requirement would apply to one third of all LTC facility residents, 
resulting in an estimated cost of $1,473,047 ($.10 (cost to make a copy 
per notice) + $.63 (cost for pre-stamped envelope based on USPS retail) 
+ $2.58 (\5/60\ of an office assistant $31 hourly wage) x 444,582 (\1/
3\ of 1,333,745 LTC residents)). Therefore, the cost savings to 
facilities would be the difference between sending notices related to 
all transfers and discharges versus involuntary transfers and 
discharges only, resulting in a total cost savings of $1,473,047 
($2,946,095 - $1,473,047).
4. ICRs Regarding Nursing Services (Sec.  483.35)
    The proposed revisions in this section are related to record 
retention. While we believe that reducing the timeframe for maintaining 
records will produce cost savings to facilities, there are no 
collection of information requirements associated with this proposed 
change because maintaining records in this instance is considered a 
usual and customary practice in accordance with the implementing of 
regulations of the PRA 5 CFR 1320.3(b)(2).
5. ICRs Regarding Administration (Sec.  483.70(e))
    LTC facilities are required to address in the facility assessment 
the facility's resident population (that is, number of residents, 
overall types of care and staff competencies required by the residents, 
and cultural aspects) and equipment. We estimate that it takes a 
facility 20 hours annually to conduct and document a facility-wide 
assessment. As stated previously, the facility must utilize information 
collected under the requirements stated under this section and the 
information collection required under Sec. Sec.  483.35, 483.40(a), 
483.60(a), and 483.75. We estimate that it requires an administrator 8 
hours to collect and analyze data from throughout the facility; 6 hours 
for the director of nursing to collect and analyze staffing data; 2 
hours for an office assistant to collect and document data; and 2 hours 
each for a facility manager and a physician to review and provide 
input. We are proposing to reduce burden on facilities by changing the 
annual facility assessment requirement to a biennial requirement. We 
estimate that the burden would be reduced as follows: An administrator, 
at the hourly wage of $89 an hour x 8 = $712; director of nursing wage 
of $89 an hour x 6 hours = $534; office assistant wage of $31 an hour x 
2 hours = $62; physician $191 an hour x 2 = $382; facility manager $38 
an hour x 2 = $76. The total cost per facility is $1,766. We estimate a 
total burden reduction of 20 hours and $27.6 million in a 2-year period 
(15,639 SNFs/NFs x $1,770 per facility = $27,618,474). Since this 
savings occurs biennially, the annual savings is one-half of this, or 
$13,809,237.
6. ICRs Regarding Quality Assurance and Performance Improvement Program 
(Sec.  483.75)
    Regulations at Sec.  483.75 require facilities to develop, 
implement, and maintain an effective, comprehensive, data-driven QAPI 
program. The existing information collection assumes that it would take 
appropriately 56 burden hours for a facility to develop and document a 
QAPI program designed to monitor and evaluate performance of all 
services and programs of the facility. We maintain this assumption. 
Based on 2017 BLS data, the estimated cost to comply with the QAPI 
requirements is $5,016 per facility (the facility administrator (30 
hours x $89 = $2,670); the director of nursing (10 hours x $89 = $890); 
a registered nurse (10 hours x $63 = $630); a physician (4 hours x $191 
= $764); and an office assistant (2 hours x $31 = $62). The total cost 
for 15,639 LTC facilities is an estimated $78,445,224.
    This rule proposes to revise the requirements in Sec.  483.75 to 
provide facilities with the flexibility needed to tailor their QAPI 
programs to the individual needs of their specific facility. 
Specifically, we have proposed to remove the prescriptive requirements 
at Sec.  483.75(b)(1) through (4), and Sec.  483.75(c)(1) through (4), 
and all of the requirements in Sec.  483.75(d)(2). A detailed 
discussion of the proposed removal of these requirements can be found 
in section II.A.
    The proposed removal of these prescriptive requirements would focus 
the QAPI requirements on the expected results of the program and would 
no longer prescribe the structures and methods for implementing the 
QAPI program. This provides flexibility to the facility, as it is free 
to develop a creative program that meets the needs of the facility and 
reflects the scope of its services and operations. Given the 
flexibility provided by the revisions and the variability across 
facilities as to where they are in the current efforts for developing a 
QAPI program, we believe

[[Page 34755]]

the expected savings that these flexibilities would provide to each 
individual facility is difficult to predict. However, we do expect that 
the added flexibilities would result in a reduction of the burden hours 
necessary to comply with these requirements.
    Therefore, we assume that the current time and effort necessary to 
develop initial internal policies that reflect the individual goals set 
by the facility of 56 burden hours could be reduced by half. This would 
result in a cost of $2,508 per facility (the facility administrator (15 
hours x $89 = $1,335); the director of nursing (5 hours x $89 = $445); 
a registered nurse (5 hours x $63 = $315); a physician (2 hours x $191 
= $382); and an office assistant (1 hours x $31 = $31). The total cost 
for 15,639 LTC facilities is an estimated $39,222,612. Therefore, this 
would result in a burden reduction of 28 hours and $39,222,612 from the 
current requirement. This is a reduction in total burden hours of 
437,892 (875,784-437,892). For purposes of this estimate, we assume 
that facilities have not incurred the full one-time cost to meet the 
existing requirement for initial policy development (due to be 
implemented November 2019), and that the amended requirement will not 
affect the annual implementation costs. We solicit public comment on 
our assumptions, and whether commenters believe there could be 
additional costs or savings that we have not included in this estimate, 
as well as on the accuracy of our savings estimate.
7. ICRs Regarding Compliance and Ethics Program (Sec.  483.85)
    We propose to reduce burden by removing the mandatory annual 
training requirements for the operating organization's compliance and 
ethics program. We have proposed that each facility must review its 
compliance and ethics program biennially and revise its program as 
needed to within the operating organization and its facilities to 
improve its performance in deterring, reducing, and detecting 
violations under the Act and in promoting quality of care. In addition, 
we propose to change the annual review requirement to require operating 
organizations for each facility to review its compliance and ethics 
program biennially and revise its program as needed to reflect any 
changes.
    For the purpose of this analysis, we are utilizing the burden 
rationale that we provided and published in the rule on October 4, 2016 
(81 FR 68842). We have made cost updates to reflect current staff costs 
and number of facilities. We propose to reduce burden on facilities by 
eliminating the annual training requirement. There are currently about 
15,639 SNFs and NFs. We estimate that training staff requires the 
duties of a RN for 2 hours per facility. The cost for all 15,639 
facilities would be $1,970,514 (15,639 x 2 hours x $63 average hourly 
wage). This is a reduction of 31,278 burden hours. Based on our 
experience with SNF and NF facilities, we expect that operating 
organizations that operate 1-5 facilities have been able to minimize 
training costs by including the training on their compliance and ethics 
program with any current trainings or in-services that they already 
conduct for their staff.
    Without data to make this assertion, we have made the above 
calculation apply to all facilities and ask for both data and comments 
regarding the savings associated with removing this requirement. 
Facilities would still be required to effectively communicate 
standards, policies and procedures through a training program or in 
another practical manner. For example, online or video training modules 
could be used. However, we are no longer designating the manner nor the 
frequency for such instruction, nor requiring that facility staff be 
trained to provide such instruction.
    We also propose to reduce burden for Sec.  483.85(e) by changing 
from an annual review to a biennial review of the compliance an ethics 
program. We expect that the administrator and director of nursing would 
annually spend 5 hours each reviewing the program to ensure its 
compliance. The administrator and director of nursing salaries would 
total $890 ($178 combined hourly total for the administrator and 
director of nursing x 5 hours). We estimate a biennial savings of 
$5,873,110 ($890 x 6,599 operating facilities) and 65,990 hours (6,599 
operating facilities x 10 hours). Since this savings occurs biennially, 
the annual saving is one-half of this, or $2,936,555 and 32,995 hours
    The total annualized reduction in information collection cost for 
these reforms would be an estimated $4,907,069 ($1,970,514 + 
$2,936,555). The total reduction in burden hours is 64,273 hours.
    If you comment on these information collection, that is, reporting, 
recordkeeping or third-party disclosure requirements, please submit 
your comments electronically as specified in the ADDRESSES section of 
this proposed rule.
    Comments must be received on/by September 16, 2019.

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, when we proceed with a subsequent document, we will respond to the 
comments in the preamble to that document.

V. Regulatory Impact Analysis

A. Statement of Need

    We periodically review the Medicare and Medicaid health and safety 
standards in an effort to ensure that they do not unnecessarily burden 
patient or regulated entities, remain current, and reflect advances in 
the health care industry. We are proposing revisions to the LTC 
requirements that would simplify and streamline the current 
requirements, increase flexibility in LTC facilities, and reduce 
excessively burdensome requirements, while maintaining a focus on 
providing high quality care to residents. This proposed rule would also 
reduce the frequency of certain required activities, revise timeframes 
for certain requirements where appropriate, and remove obsolete, 
duplicative, or unnecessary requirements. Ultimately, these proposals 
balance resident safety and quality of care, while also providing 
regulatory relief for facilities.

B. Overall Impact

    We have examined the impacts of this rule as required by E.O. 12866 
on Regulatory Planning and Review (September 30, 1993), E.O. 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 Act, section 202 of the Unfunded Mandates Reform 
Act of 1995 (March 22, 1995; Pub. L. 104-4), E.O. 13132 on Federalism 
(August 4, 1999), the Congressional Review Act (5 U.S.C. 804(2) and 
E.O. 13771 on Reducing Regulation and Controlling Regulatory Costs 
(January 30, 2017).
    E.O. 13771 states that it is essential to manage the costs 
associated with the government imposition of private expenditures 
required to comply with federal regulations and establishes policies 
and procedures to reduce the costs of both new and existing federal 
regulations. 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

[[Page 34756]]

approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, distributive impacts, 
and equity). Section 3(f) of E.O. 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 1 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 E.O.
    A Regulatory Impact Analysis (RIA) must be prepared for major rules 
with economically significant effects ($100 million or more in any 1 
year). We estimate that this rulemaking is ``economically significant'' 
as measured by the $100 million threshold, and hence also a major rule 
under the Congressional Review Act. Accordingly, we have prepared a RIA 
that to the best of our ability presents the costs and benefits of the 
rulemaking.
    In accordance with the provisions of E.O. 12866, this regulation 
was reviewed by the Office of Management and Budget. This proposed rule 
contains proposals that would create ongoing cost savings to LTC 
facilities. Other revisions we have proposed would clarify existing 
policy and relieve some administrative burdens. The financial savings 
are summarized in the table that follows. We welcome public comments on 
all of our burden assumptions and estimates as well as comments 
identifying additional reforms that should be considered in the final 
rule or future rulemakings. As discussed later in this regulatory 
impact analysis, uncertainty surrounds these estimates and we 
especially solicit comments on either our estimates of likely savings 
or the specific regulatory revisions that drive these estimates.

C. Sources of Data Used in Estimates of Burden Hours and Cost Estimates

    We obtained the data used in this discussion on the number of 
Medicare and Medicaid participating LTC facilities from Medicare's 
Certification and Survey Provider Enhanced Reporting (CASPER) as of May 
2018, unless indicated otherwise. We have not included data for 
facilities that are not Medicare or Medicaid certified. As of May 2018, 
there are 15,639 LTC facilities that participate in the Medicare and/or 
Medicaid program.
    Unless otherwise indicated, we obtained all salary information from 
the May 2017 National Occupational Employment and Wage Estimates, 
United States by the BLS at https://www.bls.gov/oes/current/oes_nat.htm 
and we have calculated the estimated hourly rates in this proposed rule 
based upon the national mean salary for that particular position 
increased by 100 percent to account for overhead costs and fringe 
benefits. The raw wage and salary data from the BLS do not include 
health, retirement, and other fringe benefits, or the rent, utilities, 
information technology, administrative, and other types of overhead 
costs supporting each employee. HHS department-wide guidance on 
preparation of regulatory and paperwork burden estimates states that 
doubling salary costs is a good approximation to these overhead and 
fringe benefit costs. The hourly wages calculated on this basis are 
shown in Table 3 in Section III Collection of Information.

D. Anticipated Effects on LTC Facilities

    Table 4 summarizes the expected savings to facilities from the 
preceding information collection reforms and the other cost savings 
addressed in detail in the following section of the RIA.
BILLING CODE 4120-01-P

[[Page 34757]]

[GRAPHIC] [TIFF OMITTED] TP18JY19.030


[[Page 34758]]


[GRAPHIC] [TIFF OMITTED] TP18JY19.031

BILLING CODE 4120-01-C
1. Resident Rights (Sec.  483.10(j))
    We propose several revisions to the regulations at Sec.  483.10(j) 
that require facilities to develop a grievance policy. In the October 
2016 final rule, we indicated most facilities already have a

[[Page 34759]]

grievance process and therefore, the cost associated with establishing 
a grievance policy would mainly be attributed to the requirement for a 
grievance official with specific duties. This rule proposes, at Sec.  
483.10(j)(4)(ii), to remove the specific duties required of the 
grievance official. The October 2016 final rule estimated that the 
regulatory burden for establishing a designated grievance official to 
oversee the grievance process and to perform specific duties is 
$156,139,776 annually (updated to reflect current salary information). 
The revision would eliminate the staff burden associated with the 
specific tasks that must be performed by the grievance official. 
Facilities would have the flexibility to determine how their grievance 
policy can be tailored to fully address grievances and establish the 
necessary duties of their designated grievance official.
    We assume that removing the prescriptive required duties would 
reduce the current burden by approximately half due to the increased 
flexibility that would allow facilities to execute a grievance process 
in the most efficient manner for each facility's needs. Therefore, this 
proposal would result in a cost savings of $78,069,888 (5 percent of a 
social worker FTE x $48 hourly wage for a social worker x 2,080 hours 
(40 hours a week x 52 weeks) x 15,639 facilities). We request comments 
on this assumption.
2. Admission, Transfer, and Discharge Rights (Sec.  483.15)
    The cost savings to facilities for proposals in this section are 
related to paperwork burden and discussed in detail in the Collection 
of Information section. We estimate a total cost savings of $1,148,503.
3. Quality of Care (Sec.  483.25)
    The proposed revisions in the section clarify existing requirements 
related to the use of bedrails and have negligible effects on reducing 
facility costs.
4. Nursing Services (Sec.  483.35)
    The proposed revisions in this section are related to 
administrative processes and any cost savings would normally be 
discussed in the Collection of Information section. However, as noted 
the proposed revisions in this section are related to record retention. 
While we believe that reducing the timeframe for maintaining records 
will produce cost savings to facilities, there are no collection of 
information requirements associated with this proposed change because 
maintaining records is considered a usual and customary practice in 
accordance with the implementing of regulations of the PRA 5 CFR 
1320.3(b)(2). Moreover, we believe that the cost savings from the 
reduced duration of the daily staffing list storage requirement would 
be minimal, saving at most the equivalent of one file cabinet drawer of 
space per facility.
5. Behavioral Health (Sec.  483.40)
    The proposed revisions in this section remove duplicative 
requirements and do not affect facility costs.
6. Pharmacy Services (Sec.  483.45)
    The proposed reforms in this section are aimed to strengthen 
resident protections by eliminating unnecessary restrictions on 
prescribers' ability to tailor psychotropic prescriptions to resident 
needs, avoiding unnecessary delays in prescribing, and placing 
responsibility on facilities to develop more tailored policies on using 
PRN orders for psychotropic drugs. We expect that these reforms will 
reduce unnecessary interruptions in some residents' care while 
preserving needed resident protections. We do not expect significant 
changes in either costs or benefits and have not attempted to make a 
quantitative forecast of either.
7. Food and Nutrition Services (Sec.  483.60)
    We propose to revise the required qualifications for a director of 
food and nutrition services to provide that those with several years of 
experience performing as the director of food and nutrition services in 
a facility can continue to do so. This is a major change from the 
October 2016 final rule, which added credentialing requirements for the 
director of food and nutrition services to include being a ``certified 
food service manager,'' or ``certified dietary manager,'' or ``has 
similar national certification . . . from a national certifying body,'' 
or has an associate's or higher degree in food service or restaurant 
management. Under the October 2016 final rule, a significant fraction 
of current directors of food and nutrition services would have had to 
be replaced or, at great expense, have had to attend an institution of 
higher education to obtain required credential.
    The current annual cost for the director of food and nutrition 
services is an estimated $122,400 annually (updated to reflect current 
salary information and including fringe benefits and overhead costs). 
We previously estimated that 10 percent of facilities would need to 
pursue additional candidates that meet the new qualifications for a 
director of food and nutrition services. Assuming that, on average, 
there is a 10 percent wage differential between those with experience 
but no further credential, and those who would have met the standards 
of the October 2016 final rule for director of food and nutrition 
services either as specified in that rule, or by meeting the even 
higher standards for ``qualified dietician,'' this means that removing 
those standards would reduce costs to facilities by $19,142,136 (10 
percent of 15,639 facilities x $12,240). In this calculation, the wage 
differential is assumed to be only about 10 percent because there are 
offsetting costs to the facility for retaining staff who are qualified 
by experience but who may need expert help, such as the proposed 
requirement for frequently scheduled consultation with a qualified 
dietician. We welcome comments on these estimates and additional 
information that would help us improve them.
    We propose that at a minimum an individual designated as the 
director of food and nutrition services receives frequently scheduled 
consultations from a qualified dietitian or other clinically qualified 
nutrition professional; and has 2 or more years of experience in the 
position of a director of food and nutrition services, or has completed 
a minimum course of study in food safety. These revisions would provide 
an experience qualifier that would likely eliminate the need for many 
facilities to hire additional or higher salaried staff.
8. Administration (483.70)
    We discuss the economic impact for the administration requirement 
in the ICR section of this rule. We estimate $13,840,515 in savings.
9. Quality Assurance and Performance Improvement Program (Sec.  483.75)
    This rule proposes to revise the requirements in Sec.  483.75 to 
provide facilities with the flexibility needed to tailor their QAPI 
programs to the individual needs of their specific facility. 
Specifically, we have proposed to remove the prescriptive requirements 
at Sec.  483.75(b)(1) through (4), and Sec.  483.75(c)(1) through (4), 
and all of the requirements in Sec.  483.75(d)(2). A detailed 
discussion of the proposed removal of these requirements can be found 
in section II.A.
    The proposed removal of these prescriptive requirements would focus 
the QAPI requirements on the expected results of the program and would 
no longer prescribe the structures and methods for implementing the 
QAPI program. This provides flexibility to the facility, as it is free 
to develop a creative program that meets the needs of the

[[Page 34760]]

facility and reflects the scope of its services and operations. We 
discuss the economic impact for the QAPI program in the ICR section of 
this rule, which represents $39,222,612 in savings.
10. Infection Control (Sec.  483.80)
    We have proposed changing the requirement that the infection 
preventionist work at the facility ``part-time'' or have frequent 
contact with the infection prevention and control program staff at the 
facility, to instead require that the facility ensure that the IP has 
sufficient time to meet the objectives of its IPCP. Because this is 
more of a clarification than a change in policy, we do not anticipate 
any measurable impact from this revision.
11. Compliance and Ethics Program (Sec.  483.85(d))
    We propose to reduce cost to facilities by eliminating the 
requirement for a dedicated compliance officer and a compliance 
liaison. We estimated that in carrying out this program the compliance 
officer (similar to an administrator) in each of the 422 organizations 
operating 5 or more facilities will commit 30 percent of a full time 
equivalent (FTE) in the compliance program operation, for a total cost 
of $23,436,192 (30 percent of FTE x 2080 x $89 x 422). We also estimate 
that in carrying out this program the compliance liaison (nursing 
staff) in each of 6,599 facilities will commit 10 percent of an FTE, at 
a total cost of $86,473,296 (10 percent of FTE x 2080 x $63 x 6,599). 
As such, by removing these requirements, we estimate annual savings of 
$109,909,488. We discussed the burden reduction for our proposed 
revision of the compliance and ethics program plan requirements imposed 
on LTC facilities in the ICR section of this rule, which estimates 
annual savings of $13,716,734. We estimate total annual savings for 
these requirements together of $123,626,222.
12. Physical Environment
Life Safety Code Sec.  483.90(a)
    At Sec.  483.90(a) we are proposing to allow those existing LTC 
facilities (those that were Medicare or Medicaid certified before July 
5, 2016) that have previously used the FSES to determine equivalent 
fire protection levels, to continue to use the 2001 FSES mandatory 
values when determining compliance for containment, extinguishment and 
people movement requirements. This would allow existing LTC facilities 
that previously met the FSES requirements to continue to do so without 
incurring great expense to change construction type--essentially 
undertake an effort to completely rebuild. Facilities may request a 
waiver of certain life-safety code requirements. The request and 
subsequent approval of such a waiver would constitute compliance with 
the Life Safety Code.
    While we do not have information on the number of facilities that 
undertake reconstruction in a given year, we can estimate the number of 
facilities placed at risk of a deficiency citation by these 
requirements, and thus the risk of being required to rebuild the 
structure in order to update the building's construction type, by 
considering the age of the facility and the building methodologies used 
in given time periods. We consulted with CMS Regional Office survey 
staff, and based on information received from them, we estimate that 50 
facilities are directly impacted by the change in the scoring of the 
FSES and would no longer achieve a passing score on the FSES. We 
estimate the average size of the affected nursing homes to be roughly 
25,000 sq. ft. The cost of construction per sq. ft. is estimated at 
$180 in 2013 dollars (https://www.rsmeans.com/model-pages/nursing-home.aspx). Assuming a construction cost increase over this period of 
6.5 percent using GDP deflator, the 2017 construction cost per square 
foot would be about $192 a square foot. The total savings from this 
proposal in 2017 dollars would be approximately $240 million (25,000 
sq. ft. x $192 per sq. ft. x 50 facilities).
    This estimate assumes that essentially all these facilities would 
be replaced. There are two major and offsetting trends affecting the 
nursing home care market in coming decades: The increasing preference 
and ability of elderly and disabled adults to finance and obtain long 
term nursing care in their own homes, and the increasing number of 
elderly and disabled adults as the baby boom population ages. Assuming, 
absent specific evidence, that these two trends roughly offset each 
other, the preceding estimates are a reasonable projection of likely 
investment costs in new (or totally reconstructed) facilities. For 
purposes of annual cost estimates, we assume that those costs would be 
spread over 5 years, and would therefore be approximately $48 million 
annually in those years ($240 million/5 years). There are additional 
uncertainties in these estimates and we therefore provide estimates 
that are 25 percent lower and higher in the Accounting table near the 
end of this RIA.
Bathroom Facilities Sec.  483.90(f)
    We are proposing to revise Sec.  483.90(f) regarding bathroom 
facilities, to apply only to newly constructed facilities and newly 
certified facilities that have never previously been a long-term care 
facility. The cost of remodeling or installing a bathroom where there 
is none requires a substantial amount of work in some cases and may 
cause facilities to decide not to reopen or that the upgrade is not 
worth the cost. Sometimes when a facility is terminated, a new owner 
will come in and get newly certified. Under current requirements, the 
new owners would have to make the upgrades, which often times 
discourages new ownership (https://www.rsmeans.com/model-pages/nursing-home.aspx).
    We estimate that there are 150 terminations per year, which we will 
assume come back into the program eventually under the same ownership 
with a new Medicare Identification Number, and that two-thirds (that 
is, 100) of these would have required bathroom installations. We also 
assume that there are 700 changes of ownership per year without the 
transfer of a Medicare Identification Number and provider agreement, of 
which about two-thirds (that is, 470) would require remodeling the 
bathrooms. The two-thirds estimate is an assumption based on the lack 
of state requirements requiring bathrooms adjacent to resident rooms. 
In each of the scenarios above, facility closure or the change of 
ownership without the transfer of a Medicare Identification Number and 
provider agreement necessitates reapplication for enrollment in the 
Medicare program. Therefore the facilities would be considered newly 
certified, triggering the requirements at Sec. Sec.  483.90(e)(1)(i) 
and (f). For a wheelchair accessible bathroom with 2 fixtures (a 
commode and sink) the average square footage is 60 square feet. The 
average cost of construction per square foot was $180 in 2013 according 
to RSMeans construction cost data (again, https://www.rsmeans.com/model-pages/nursing-home.aspx). Assuming a construction cost increase 
over this period of 6.5 percent using the GDP deflator, the 2017 
construction costs per square foot would be about $192 a square foot. 
The average number of residents per facility is 100/2 persons per room, 
giving an average of 50 bathrooms per facility. Therefore, we estimate 
the total first year savings for this proposal would be $576,000 based 
on the following: 60 sq. ft. per bathroom x 50 bathrooms x $192 per sq. 
ft. (inflating to 2017 dollars) = $576,000

[[Page 34761]]

per facility ($11,520 per room). These costs divide among terminations 
and change of ownership as follows:
    Terminations: 100 x $576,000 = $57,600,000.
    Change of Ownership: 470 x $576,000 = $270,720,000.
    These calculations lead to a total first year savings estimate of 
$328,000,000 ($57,600,000 + $270,720,000). Second and future year 
savings would, however, be lower because the proportion of the existing 
facilities needing bathroom upgrades would have decreased each year 
under the October 2016 final rule. The combined number of estimated 
terminations and changes of ownership receiving these upgrades of 570 
per year under the October 2016 final rule represents about 4 percent 
of the baseline stock. Presumably the likely savings from repeal of 
this requirement would therefore be lower by about 4 percent each year 
than in the year before (compounding over time as the baseline stock 
with such bathrooms increases). Our Accounting table's annualized 
estimates make this adjustment. Also, as previously described, our 
accounting table provides high and low estimates that are 25 percent 
higher or lower to emphasize the uncertainty in these estimates.
13. Informal Dispute Resolution and Independent Informal Dispute 
Resolution (Sec.  488.331 and Sec.  488.431)
    While the proposed provisions regarding the IDR and Independent IDR 
processes would not have significant financial burden reduction for 
providers, addressing issues related to the timeliness and transparency 
of these procedures could potentially save time and money for 
providers, the States, and CMS. In 2016, the completion time for the 
IDR process ranged from 1 day to 519 days with a median of 21 days. 
Providers are now required to pay CMPs into an escrow account where 
they are held pending a final administrative decision. For smaller 
facilities, having what could be a substantial amount of money held in 
escrow for more than a year could cause financial burden on the 
facility. Requiring that the process be completed in 60 days, 
consistent with the Independent IDR procedure, would result in a more 
timely return of the money being held in the case where the provider 
was successful in their appeal. This would also result in a financial 
savings to CMS as we are required to return the CMP with interest when 
the facility is successful. While it is impossible to place an exact 
dollar amount on these savings, in 2016, facilities were found non-
culpable in the incidents that resulted in citations in 6 percent of 
IDR decisions and 12 percent of Independent IDR decisions.
    The proposal specifying when the survey results should be uploaded 
into CASPER could not only potentially have a positive financial impact 
on providers but it could also have a positive impact on SAs' workload. 
As previously cited, in 2016, 47.31 percent of IDRs resulted in a 
change to the original citations. As a result of Independent IDRs, 21.8 
percent of original citations were changed in some manner. If the 
survey results were uploaded to CASPER prior to the completion of these 
processes, the results could negatively impact a facility's Five-Star 
Quality Rating, which could not only result in a loss of business but a 
financial loss as well. For example, we are aware that there are 
payments as well as accreditation from certain organizations that are 
directly affected by the facility's Five-Star Quality Rating. Again, it 
is not possible to put a dollar amount on these savings as not all 
changes made based on these processes would have an impact on Five-Star 
Quality Ratings. For the SAs, if the information was entered prior to 
the completion of these processes, they would have to go back and 
correct any changes resulting from these processes which is valuable 
time that could be spent on other duties more beneficial to the 
protection of nursing home residents.
    The proposal specifying that facilities must be provided with a 
written record of the final Independent IDR decision, including the 
Independent IDR reviewer's recommendation and, in the case where the 
State or CMS disagrees with that recommendation, a rationale for the 
disagreement, would reduce burden on providers, the States, and CMS by 
promoting transparency in the Independent IDR process. Providers would 
be given information needed to understand the final decision and no 
further investigation on their part would be necessary. The States and 
CMS would not have to respond to requests for more information as 
everything would be provided in the written record.
    Finally, the proposal to specify that, in order to be approved as 
an Independent IDR reviewer, a component of an umbrella agency must 
have a specific understanding of Medicare and Medicaid requirements 
would avoid the potential for Independent IDR decisions to be 
challenged based on the inadequate qualifications of a reviewer. This 
could provide financial benefit to both providers and to CMS by 
avoiding unnecessary litigation. However, we have no basis for a 
savings calculation.
14. Civil Money Penalties: Waiver of Hearing, Reduction of Penalty 
Amount (Sec.  488.436)
    Current requirements at Sec.  488.436(a) set forth a process for 
submitting a written waiver of a hearing which, when properly filed, 
results in the reduction by CMS or the State of a facility's CMP by 35 
percent, as long as the CMP has not also been reduced by 50 percent 
under Sec.  488.438. We propose to restructure the waiver process by 
establishing a constructive waiver at Sec.  488.436(a) that would 
operate by default when CMS has not received a timely request for a 
hearing. Since a large majority of facilities facing CMPs typically 
file the currently required express, written waiver, this proposed 
change to provide for a constructive waiver (after the 60-day timeframe 
in which to file an appeal following notice) would reduce the costs and 
paperwork burden for most facilities.
    In CY 2016, 81 percent of facilities facing CMPs filed an express 
waiver; whereas only 4 percent of facilities facing CMPs filed an 
appeal and went through the hearing process. The remaining 15 percent 
of facilities are those who fail to waive at all or fail to waive 
timely when they do not appeal. We estimate that moving to a 
constructive waiver process would eliminate the time and paperwork 
necessary to complete and send in a written waiver and would thereby 
result in a total annual savings of $1,108,226 for LTC facilities 
facing CMPs as estimated in the following savings estimates ($381,800 
plus $726,426 = $1,108,226).
    We estimate that, at a minimum, facilities would save the routine 
cost of preparing and filing a letter (estimated at $200 per letter) to 
waive their hearing rights. In CY 2016, there were 2,360 facilities who 
faced CMPs. Roughly 81 percent (1,909) of these facilities filed an 
express, written waiver, therefore, we estimate an annual savings of 
$381,800 (1,909 x $200) since such letters would no longer be required 
to receive a 35 percent penalty reduction.
    In addition, we believe that nationally some 15 percent of 
facilities fail to submit a waiver even though they had no intention of 
contesting the penalty and its basis. Under the proposed change to 
offer a constructive waiver by default, this 15 percent of facilities 
would now be eligible for the 35 percent cost reduction. We note that 
in CY 2016, CMS imposed a combined total of $116,387,898 in per day and 
per instance CMPs, with a median total amount due of $5,863. Since CMS 
imposed CMPs on 2,360 facilities in CY

[[Page 34762]]

2016, we estimate a cost savings for 354 facilities (15 percent of 
2,360), the typical 15 percent who fail to submit a timely waiver 
request. We estimate the annual cost savings for these facilities at 
$726,426 ((35 percent x $5,863) x 354 facilities). For accounting 
purposes, this is considered a transfer between LTC facilities and the 
federal government.
    Furthermore, we believe that the proposal to offer facilities a 
default constructive waiver process would also ease the administrative 
burden for the CMS Regional Offices. Based on our knowledge and 
experience, we estimate that, together, an array of individuals in each 
CMS Regional Office collectively spend close to 1 hour (0.80 hours) per 
CMP imposed to track and manage receipt of paperwork from facilities 
expressly requesting a waiver. Given that in CY 2016, CMS imposed a 
total of 2,858 CMPs on 2,360 facilities, with an average of 1.21 CMPs 
per facility, we estimate that CMS Regional Offices spend a total of 
1,848 hours each year (0.80 hours per CMP x 1,909 facilities x 1.21 
CMPs per facility) to manage the waiver paperwork. As previously noted, 
in CY 2016 we saw that 81 percent (1909) of the 2,360 facilities facing 
CMPs submitted written waivers. Because the activities involved in 
processing facilities' waivers requires input from individuals at 
varying levels within CMS, we base our estimate on the rate of $68.12 
per hour on average, assuming a GS-12, step 5 salary rate of $34.06 per 
hour with a 100 percent benefits and overhead package. Thus, we 
estimate that CMS would save $125,886 per year ($68.12 per hour x 1,848 
hours per year).
    Total annual savings from these reforms to facilities and the 
federal government together would therefore be $1,233,112 ($381,800 
plus $726,426 plus $125,886).
15. One-Time Implementation Costs
    All of the proposals presented in the preceding analysis and 
detailed regulatory language changes will necessarily have to be read, 
understood, and implemented by affected providers. This will create 
one-time costs even though the underlying change reduce burden. In most 
cases these costs will be very low, and may be as simple as observing 
that a particular procedure will need only to be performed once rather 
than twice a year, and changing the schedule accordingly. In some 
cases, the facility will need to adjust in response to multiple burden 
reduction changes. In still other cases, time will have to be spent 
deciding how to change existing policy.
    In total, there are about 15,639 affected entities. We assume that 
on average there will be 1 hour of time spent by a lawyer, 2 hours of 
time by facility administrator, and 2 hours of time by other staff (we 
assume registered nurses or equivalent in wage costs) of each affected 
provider to understand the regulatory change(s) and make the 
appropriate changes in procedures. We further estimate that 2 hours of 
director of nursing or facility administrator time and 2 hours of 
clerical time will be needed to direct and communicate changes in 
facility policy. Average hourly costs for these professions, with wage 
rates doubled to account for fringe benefits and overhead costs, are 
$136 for attorneys, $89 for director of nursing, $63 for registered 
nurses, $89 for facility administrator, and $31 for office assistant. 
These hourly estimates are from Table 3 and the underlying data are 
taken from BLS statistics for 2017, at https://www.bls.gov/oes/current/oes_nat.htm#39-0000.
    The estimated costs for an average facility would be 1 hour at $136 
and in total for attorney time, 4 hours at $89 or $356 in total for the 
facility administrator and director of nursing, 2 hours of time at $31 
or $62 in total for clerical work, and 2 hours of time at $63 or $126 
in total for other staff (RN hourly wage). For all facilities these 
costs add up to 15,639 times. These one-time costs add up to $680 per 
facility on average ($136 + $356 + $62 + $126), and in total to about 
$11 million (680 x 15,639 LTC facilities).

E. Effects on Small Entities, Effects on Small Rural Hospitals, 
Unfunded Mandates, and Federalism

    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 estimate that 
almost all LTC facilities regulated by CMS are small entities as that 
term is used in the RFA (including small businesses, nonprofit 
organizations, and small governmental jurisdictions). The majority of 
long term care facilities and most other health care providers and 
suppliers are small entities, either by being nonprofit organizations 
or by meeting the SBA definition of a small business (having revenues 
of less than $7.5 million to $38.5 million in any 1 year). Accordingly, 
the savings in this proposed rule would create benefits for small 
entities.
    The RFA requires that an Initial Regulatory Flexibility Analysis 
(IRFA) be prepared if a proposed rule would have a ``significant impact 
on a substantial number'' of such entities. HHS interprets the statute 
as mandating this analysis only if the impact is adverse, though there 
are differing interpretations. Regardless, there is no question that 
this proposed rule would affect a ``substantial number'' of small 
entities. The rule of thumb used by HHS for determining whether an 
impact is ``significant'' is an effect of 3 percent or more of annual 
revenues. These savings do not approach that threshold for most of the 
affected facilities. However, for those facilities that would benefit 
from the reforms proposed for physical environment standards, savings 
would far exceed the 3 percent threshold. We estimate that over one 
thousand facilities would benefit from these particular reforms, with 
total savings to these facilities exceeding $800 million in the first 
year. Accordingly, we have concluded that the economic effects of this 
proposed rule would have a significant beneficial effect on a 
substantial number of small entities. This RIA, together with the 
remainder of the preamble, meets the standards for an IRFA.
    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 603. 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. This rule affects only LTC facilities and will 
not have any direct impacts on small rural hospitals. Therefore, the 
Secretary has determined that this proposed rule will not have a 
significant impact on the operations of a substantial number of small 
rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule whose mandates require spending in any 1 year of $100 
million in 1995 dollars, updated annually for inflation. In 2019, that 
threshold is approximately $154 million. UMRA does not address the 
total cost of a rule. Rather, it focuses on certain categories of cost, 
mainly those ``Federal mandate'' costs resulting from (A) imposing 
enforceable duties on state, local, or tribal governments, or on the 
private sector, or (B) increasing the stringency of conditions in, or 
decreasing the funding of, state, local, or tribal governments under 
entitlement

[[Page 34763]]

programs. This proposed rule contains no such mandates.
    E.O. 13132 establishes certain requirements that an agency must 
meet when it promulgates a proposed rule (and subsequent final rule) 
that imposes substantial direct requirement costs on state and local 
governments, preempts state law, or otherwise has Federalism 
implications. This proposed rule would impose no such requirements.

F. Effects on Costs to Facilities, Providers, Medicare, Medicaid, and 
Patients

    The immediate effects of these proposed reforms will benefit 
nursing facilities by reducing their costs, in some cases quite 
substantially, as estimated earlier in this RIA.
    This proposed rule has no direct effects on the Medicare or 
Medicaid programs. Medicaid, however, pays for the majority of LTC 
costs, with more than 60 percent of residents having Medicaid as their 
primary payer. Medicare pays for a substantial fraction of skilled 
nursing care provided at these same facilities. Medicaid payment rates 
are set by states and it is likely that over a period of time facility 
savings will affect State decisions on future rates. However, there is 
no one-to-one correspondence. Likewise, Medicare payment rates for 
skilled nursing care are set based on statutory formulas and do not 
rapidly respond to changes in cost of care at any particular facility. 
It is likely, however, that in the long run most of these burden 
reduction savings will reduce taxpayer costs, both federal and state, 
under the Medicaid and Medicare programs. Private payers, both private 
insurance and many patients, will also benefit, but to a lesser extent 
since their share of nursing facility costs is relatively small.
    We have not attempted to estimate effects on patients at these 
facilities. We do not believe that any substantial increases or 
reductions in the quality of patient care will result. Freeing up staff 
resources that are unreasonably burdensome will free up staff time 
available for beneficial services, but these effects are likely small 
and not practical to estimate. We welcome comments, however, that focus 
on patient care issues.

G. Alternatives Considered

    Throughout this preamble we have raised issues of regulatory costs. 
Those reforms we have proposed are those that in our view are most 
likely to produce significant savings without jeopardizing patient care 
in any way. Indeed, reductions in unnecessary red tape free up facility 
resources to focus on patient care. We used the May 2017 RFI comments 
and previous public comments on prior rules extensively in developing 
these proposals.
    Some specific alternative proposals we considered include 
modifications to the requirements for the infection preventionist to 
reduce costs and increase access. Ultimately, we considered current 
events and recent reports (as discussed in the infection control 
section) that indicate the prevalence of infection control concerns 
within nursing homes and determined it would not be appropriate to 
propose robust revisions to the infection control requirements at this 
time. Second, we considered not proposing any revisions the PRN 
requirements for anti-psychotic medications. However, based on concerns 
raised by commenters, especially the challenges highlighted by 
psychiatric professionals (as discussed in the pharmacy services 
section) we determined that a balance between resident safety and 
access to appropriate medications is necessary and we have solicited 
comment on this proposal for further insight.
    Lastly, we considered not proposing any burden reducing proposals 
for nursing homes at this time, given that the 2016 final rule has not 
been fully implemented yet. However, we considered the comments 
received as part of the May 2017 RFI and those responses to the 2016 
final rule, and determined that some modifications to the recent 
requirements would be appropriate at this time.
    This said, there may well be significant reform options that we 
have not directly identified. We strongly encourage comments not only 
on the proposals identified in this rule, but also on other existing 
regulatory requirements, both to improve these proposals and to 
identify other beneficial reforms that we did not specifically 
identify. In particular, we request comments on other changes made in 
the 2016 final rule that could be revised or eliminated to reduce 
unnecessary burden.

H. Accounting Statement and Table

    As required by OMB Circular A-4 (available at www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf), in Table 5, we 
have prepared an accounting statement showing the classification of the 
transfers and costs associated with the various provisions of this 
proposed rule. As previously discussed, there are no costs that would 
be created under this proposed rule, and minimal transfer payments. 
There likely would be some benefits to residents from freeing up staff 
to focus on resident care rather than unnecessary paperwork and other 
burdens, but these are likely to be small and cannot be estimated. The 
primary estimate shown in this table is lower than our estimate of as 
much as $644 million annually in the first 5 years because we estimate 
that the LSC cost savings will be achieved only during the first 5 
years and our annualized estimate covers 10 years. Totals are rounded 
to the nearest $10 million.

[[Page 34764]]

[GRAPHIC] [TIFF OMITTED] TP18JY19.032

I. Reducing Regulation and Controlling Regulatory Costs

    E.O. 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.'' This proposed rule 
will, if finalized as proposed, be considered an E.O. 13771 
deregulatory action. We estimate that this rule generates $392 million 
in annualized cost savings in 2016 dollars, discounted at 7 percent 
relative to year 2016, over a perpetual time horizon. Details on the 
estimated cost savings from this rule can be found in the preceding 
analysis.

J. Conclusion

    This proposed rule would substantially reduce existing regulatory 
requirements imposed on LTC facilities through the CoPs that Medicare 
and Medicaid providers must meet. The analysis in this RIA section, 
together with the remainder of this preamble, provides a complete RIA 
as well as a complete IRFA.
    In accordance with the provisions of E.O. 12866, this regulation 
was reviewed by the Office of Management and Budget.

List of Subjects

42 CFR Part 410

    Health facilities, Health professions, Diseases, Laboratories, 
Medicare, Reporting and recordkeeping requirements, Rural areas X-rays.

42 CFR Part 482

    Grant programs--health, Hospitals, Medicaid, Medicare, Reporting 
and recordkeeping requirements.

42 CFR Part 483

    Grant programs--health, Health facilities, Health professions, 
Health records, Medicaid, Medicare, Nursing homes, Nutrition, Reporting 
and recordkeeping requirements, Safety.

42 CFR Part 485

    Grant programs--health, Health facilities, Medicaid, Privacy, 
Reporting and recordkeeping requirements.

42 CFR Part 488

    Administrative practice and procedure, Health facilities, Medicare, 
Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, the Centers for Medicare 
& Medicaid Services proposes to amend 42 CFR chapter IV as set forth in 
Requirements for states and long term care facilities:

PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS

0
1. The authority citation for part 410 continues to read as follows:

    Authority:  Secs. 1102, 1834, 1871, 1881, and 1893 of the Social 
Security Act (42 U.S.C. 1302, 1395m, 1395hh, 1395rr, and 1395ddd).


Sec.  410.32  [Amended]

0
2. Section 410.32 is amended in paragraph (d)(1)(vii) by removing the 
reference ``Sec.  483.75(k)(1)(i)'' and adding in its place the 
reference ``Sec.  483.50(a)(1)(i)''.


Sec.  410.78  [Amended]

0
3. Section 410.78 is amended in paragraph (e)(2) by removing the 
reference ``Sec.  483.40(c)'' and adding in its place the reference 
``Sec.  483.30(c)''.

PART 482--CONDITIONS OF PARTICIPATION FOR HOSPITALS

0
1. The authority citation for part 482 continues to read as follows:

    Authority:  Secs. 1102, 1871 and 1881 of the Social Security Act 
(42 U.S.C. 1302, 1395hh, and 1395rr), unless otherwise noted.


Sec.  482.58  [Amended]

0
 2. Section 482.58 is amended in paragraph (b)(5) by removing the 
reference ``483.40(d)'' and adding in its place the reference ``Sec.  
483.40(c)''.

PART 483--REQUIREMENTS FOR STATES AND LONG TERM CARE FACILITIES

0
3. The authority citation for part 483 continues to read as follows:

    Authority:  Secs. 1102, 1128I, 1819, 1871 and 1919 of the Social 
Security Act (42 U.S.C. 1302, 1320a-7, 1395i, 1395hh and 1396r).

0
4. Section 483.10 is amended by revising paragraphs (d)(3), 
(f)(11)(i)(F), (j)(1) and (2), and (j)(4)(i), (ii), (v), and (vii) to 
read as follows:


Sec.  483.10  Resident rights.

* * * * *
    (d) * * *
    (3) The facility must provide the primary care physician's name and 
contact information upon admission,

[[Page 34765]]

with any change of such information or upon the resident's request.
* * * * *
    (f) * * *
    (11) * * *
    (i) * * *
    (F) Medically-related social services as required at Sec.  
483.40(c).
* * * * *
    (j) * * *
    (1) The resident has the right to voice grievances to the facility 
or other agency or entity that hears grievances without discrimination 
or reprisal and without fear of discrimination or reprisal. Such 
grievances include those with respect to care and treatment which has 
been furnished as well as that which has not been furnished, the 
behavior of staff and of other residents; and other concerns regarding 
their LTC facility stay that differ from general feedback from 
residents or their resident representative.
    (2) The resident has the right to and the facility must make prompt 
efforts to resolve grievances the resident may have, in accordance with 
this paragraph (j).
* * * * *
    (4) * * *
    (i) Notifying resident individually or through postings in 
prominent locations throughout the facility of the right to file 
grievances orally (meaning spoken) or in writing; the right to file 
grievances anonymously; a reasonable expected time frame for completing 
the review of the grievance; the right to obtain a written decision 
regarding his or her grievance; and the contact information of 
independent entities with whom grievances may be filed, that is, the 
pertinent State Agency, Quality Improvement Organization, State Survey 
Agency and State Long-Term Care Ombudsman program or protection and 
advocacy system;
    (ii) Identifying an individual who is responsible for overseeing 
the grievance process.
* * * * *
    (v) Ensuring that all written grievance decisions include any 
pertinent information including but not limited to a summary of the 
findings or conclusions and any corrective action taken or to be taken 
by the facility as a result of the grievance;
* * * * *
    (vii) Maintaining evidence demonstrating the results of all 
grievances for a period of no less than 18 months from the issuance of 
the grievance decision.
* * * * *
0
 5. Section 483.15 is amended--
0
a. In paragraph (c)(1)(ii) by removing the reference ``Sec.  
431.220(a)(3)'' and adding in its place ``Sec.  431.220(a)(2)''; and
0
b. By revising paragraph (c)(3)(i).
    The revision reads as follows:


Sec.  483.15  Admission, transfer, and discharge rights.

* * * * *
    (c) * * *
    (3) * * *
    (i) Notify the resident and the resident's representative(s) of the 
transfer or discharge and the reasons for the move in writing and in a 
language and manner they understand. For facility-initiated involuntary 
transfers or discharges, other than emergency transfers to an acute 
care facility when return is expected, the facility must send a copy of 
the notice to a representative of the Office of the State Long-Term 
Care Ombudsman.
* * * * *
0
6. Section 483.25 is amended by revising paragraphs (n) introductory 
text and (n)(1) and (2) to read as follows:


Sec.  483.25  Quality of care.

* * * * *
    (n) Bed rails. The facility must attempt to use appropriate 
alternatives prior to the use of a side or bed rail. If a bed or side 
rail is used, the facility must ensure correct installation, use, and 
maintenance of bed rails, including but not limited to the following 
elements.
    (1) Assess the resident for risk of entrapment from bed rails use.
    (2) Review the risks and benefits of bed rails with the resident or 
resident representative and obtain informed consent prior to use.
* * * * *
0
7. Section 483.35 is amended--
0
 a. In paragraph (a)(2) by removing the reference ``paragraph (c)'' and 
adding in its place ``paragraph (e)'';
0
 b. In paragraph (e)(4) by removing the reference ``paragraph (c) of 
this section'' and adding in its place ``this paragraph (e)'';
0
 c. In paragraph (f)(2) by removing the reference ``paragraph (d)(1)'' 
and adding in its place ``paragraph (f)(1)''; and,
0
d. By revising paragraph (g)(4).
    The revision reads as follows:


Sec.  483.35  Nursing services.

* * * * *
    (g) * * *
    (4) Facility data retention requirements. The facility must 
maintain the posted daily nurse staffing data for a minimum of 15 
months, or as required by state law, whichever is greater.
0
8. Section 483.40 is amended by--
0
a. Revising paragraph (a) introductory text;
0
b. Removing paragraph (c); and
0
c. Redesignating paragraph (d) as paragraph (c).
    The revision reads as follows:


Sec.  483.40  Behavioral health services.

* * * * *
    (a) In accordance with Sec.  483.35, the facility must have 
sufficient staff who provide direct services to residents with 
competencies and skills sets that include, but are not limited to, 
knowledge of and appropriate training and supervision for:
* * * * *
0
9. Section 483.45 is amended by revising paragraphs (e)(4) and (5) to 
read as follows:


Sec.  483.45  Pharmacy services.

* * * * *
    (e) * * *
    (4) PRN orders for psychotropic drugs are limited to 14 days. If 
the attending physician or prescribing practitioner believes that it is 
appropriate for the PRN order to be extended beyond 14 days, the order 
can be extended in accordance with facility policy if he or she 
documents his or her rationale in the resident's medical record and 
indicates the duration for the PRN order.
    (5) It develops and maintains policies, standards, and procedures 
regarding the use of PRN orders for psychotropics, using recognized 
standards of practice, including the circumstances in which PRN orders 
for psychotropic drugs can be extended beyond 14 days. The policy must:
    (i) Take into consideration the facility's resident population, the 
individual residents' needs for psychotropic drugs, and their access to 
physicians and other health care practitioners; and
    (ii) Include, at a minimum, the following elements:
    (A) Standards regarding the frequency with which the attending 
physician or the prescribing practitioner must review the PRN order. 
The frequency of PRN review must be no less than the frequency of the 
required physician visits as set forth at Sec.  483.30(c).
    (B) Documentation requirements regarding the diagnosis, indications 
for use, including nursing documentation describing the circumstances 
that support the administration of the medication, and justification 
for prolonged use.
    (C) Disclosure requirements that the facility must make to the 
resident and

[[Page 34766]]

his or her representative for when a resident is prescribed an anti-
psychotic.
* * * * *
0
10. Section 483.60 is amended by revising paragraph (a)(2) to read as 
follows:


Sec.  483.60  Food and nutrition services.

* * * * *
    (a) * * *
    (2) If a qualified dietitian or other clinically qualified 
nutrition professional is not employed full-time, the facility must 
designate a person to serve as the director of food and nutrition 
services.
    (i) The director of food and nutrition services is one who at a 
minimum--
    (A) Has two or more years of experience in the position of director 
of food and nutrition services in a nursing facility setting or;
    (B) Has completed a course of study in food safety and management 
that includes topics integral to managing dietary operations such as, 
but not limited to, foodborne illness, sanitation procedures, and food 
purchasing/receiving.
    (ii) The director of food and nutrition services must receive 
frequently scheduled consultation from a qualified dietitian or other 
clinically qualified nutrition professional.
* * * * *
0
11. Section 483.70 is amended by revising paragraph (e) introductory 
text and by removing paragraph (e)(3).
    The revision reads as follows:


Sec.  483.70  Administration.

* * * * *
    (e) Facility assessment. The facility must conduct and document a 
facility-wide assessment to determine what resources are necessary to 
care for its residents competently during both day-to-day operations 
and emergencies. The facility must, in coordination with Sec. Sec.  
483.35, 483.40(a), 483.60(a), and 483.75, utilize information collected 
under the facility assessment to inform policies and procedures; review 
and update that assessment, as necessary, and at least biennially; and 
review and update this assessment whenever there is, or the facility 
plans for, any change that would require a substantial modification to 
any part of this assessment. The facility assessment must address or 
include:
* * * * *
0
12. Section 483.75 is amended by revising paragraphs (b), (c), and (d) 
to read as follows:


Sec.  483.75  Quality assurance and performance improvement program.

* * * * *
    (b) Program design and scope. A facility must design its QAPI 
program to be ongoing, comprehensive, and capable of addressing the 
full range of care and services provided by the facility.
    (c) Program feedback, data systems and monitoring. A facility must 
establish and implement written policies and procedures for feedback, 
data collections systems, and monitoring, including adverse event 
monitoring.
    (d) Program systematic analysis and systemic action. The facility 
must take actions aimed at performance improvement and, after 
implementing those actions, measure its success, and track performance 
to ensure that improvements are realized and sustained.
* * * * *
0
13. Section 483.80 is amended by revising paragraph (b)(3) to read as 
follows:


Sec.  483.80  Infection control.

* * * * *
    (b) * * *
    (3) Have sufficient time at the facility to achieve the objectives 
set forth in the facility's IPCP.
* * * * *
0
14. Section 483.85 is revised to read as follows:


Sec.  483.85  Compliance and ethics program.

    (a) Definitions. For purposes of this section, the following 
definitions apply:
    Compliance and ethics program means, with respect to a facility, a 
program of the operating organization that--
    (i) Has been reasonably designed, implemented, and enforced so that 
it is likely to be effective in preventing and detecting criminal, 
civil, and administrative violations under the Act and in promoting 
quality of care; and
    (ii) Includes, at a minimum, the required components specified in 
paragraph (c) of this section.
    High-level personnel means individual(s) who have substantial 
control over the operating organization or who have a substantial role 
in the making of policy within the operating organization.
    Operating organization means the individual(s) or entity that 
operates a facility.
    (b) General rule. Beginning on November 28, 2019, the operating 
organization for each facility must have in operation a compliance and 
ethics program (as defined in paragraph (a) of this section) that meets 
the requirements of this section.
    (c) Required components for all facilities. The operating 
organization for each facility must develop, implement, and maintain an 
effective compliance and ethics program that contains, at a minimum, 
the following components:
    (1) Established written compliance and ethics standards, policies, 
and procedures to follow that are reasonably capable of reducing the 
prospect of criminal, civil, and administrative violations under the 
Act.
    (2) Assignment of specific individuals within the high-level 
personnel of the operating organization with the overall responsibility 
to oversee compliance with the operating organization's compliance and 
ethics program's standards, policies, and procedures.
    (3) Sufficient resources and authority to the specific individuals 
designated in paragraph (c)(2) of this section to reasonably assure 
compliance with such standards, policies, and procedures.
    (4) Due care not to delegate substantial discretionary authority to 
individuals who the operating organization knew, or should have known 
through the exercise of due diligence, had a propensity to engage in 
criminal, civil, and administrative violations under the Social 
Security Act.
    (5) The facility takes steps to effectively communicate the 
standards, policies, and procedures in the operating organization's 
compliance and ethics program to the operating organization's entire 
staff; individuals providing services under a contractual arrangement; 
and volunteers, consistent with the volunteers' expected roles. 
Requirements include, but are not limited to, mandatory participation 
in training as set forth at Sec.  483.95(f) or orientation programs, or 
disseminating information that explains in a practical manner what is 
required under the program.
    (6) The facility takes reasonable steps to achieve compliance with 
the program's standards, policies, and procedures. Such steps include, 
but are not limited to, utilizing monitoring and auditing systems 
reasonably designed to detect criminal, civil, and administrative 
violations under the Act by any of the operating organization's staff, 
individuals providing services under a contractual arrangement, or 
volunteers, having in place and publicizing a reporting system whereby 
any of these individuals could report violations by others within the 
operating organization without fear of retribution.
    (7) Consistent enforcement of the operating organization's 
standards, policies, and procedures through appropriate disciplinary 
mechanisms, including, as appropriate, discipline of individuals 
responsible for the failure to

[[Page 34767]]

detect and report a violation (statute says, ``offense'') to the 
compliance and ethics program contact identified in the operating 
organization's compliance and ethics program.
    (8) After a violation is detected, the operating organization must 
ensure that all reasonable steps identified in its program are taken to 
respond appropriately to the violation and to prevent further similar 
violations, including any necessary modification to the operating 
organization's program to prevent and detect criminal, civil, and 
administrative violations under the Act.
    (9) The facility has an alternate method of reporting suspected 
violations anonymously.
    (d) Additional required components for operating organizations with 
five or more facilities. In addition to all of the other requirements 
in paragraphs (a), (b), (c), and (e) of this section, operating 
organizations that operate five or more facilities and facilities with 
corporate level management of multi-unit nursing home chains must 
comply with these additional requirements must:
    (1) Have a more formal program that includes established written 
policies defining the standards and procedures to be followed by its 
employees.
    (2) Develop a compliance and ethics program that is appropriate for 
the complexity of the operating organization and its facilities.
    (e) Program review. The operating organization for each facility 
must periodically review and revise its compliance program to identify 
necessary changes within the organization and its facilities.
0
15. Section 483.90 is amended by adding paragraph (a)(1)(iii) and 
revising paragraphs (d), (e)(1)(i), and (f) to read as follows:


Sec.  483.90  Physical environment.

* * * * *
    (a) * * *
    (1) * * *
    (iii) If a facility is Medicare- or Medicaid-certified before July 
5, 2016 and the facility has previously used the Fire Safety Evaluation 
System for compliance, the facility may use the scoring values in table 
1 to Sec.  483.90(a)(1)(iii):
[GRAPHIC] [TIFF OMITTED] TP18JY19.033

* * * * *
    (d) Space and equipment. The facility must--
    (1) Provide sufficient space and equipment in dining, health 
services, recreation, living, and program areas to enable staff to 
provide residents with needed services as required by these standards 
and as identified in each resident's assessment and plan of care; and
    (2) Maintain all mechanical, electrical, and patient care equipment 
in safe operating condition.
    (3) Conduct regular inspection of all bed frames, mattresses, and 
bed rails, if any, as part of a regular maintenance program to identify 
areas of possible entrapment. When bed rails and mattresses are used 
and purchased separately from the bed frame, the facility must ensure 
that the bed rails, mattress, and bed frame are compatible.
    (e) * * *
    (1) * * *
    (i) Accommodate no more than four residents. For facilities that 
receive approval of construction plans by state and local authorities 
or are newly certified and have never previously been a LTC facility, 
after November 28, 2016, bedrooms must accommodate no more than two 
residents.
* * * * *
    (f) Bathroom facilities. Each resident room must be equipped with 
or located near toilet and bathing facilities. For facilities that 
receive approval of construction from state and local authorities or 
are newly certified and have never previously been a LTC facility, 
after November 28, 2016, each resident room must have its own bathroom 
equipped with at least a commode and sink.
* * * * *
0
16. Section 483.95 is amended by revising paragraph (f) to read as 
follows:


Sec.  483.95  Training requirements.

* * * * *
    (f) Compliance and ethics. The operating organization for each 
facility must include as part of its compliance and ethics program, as 
set forth at Sec.  483.85, an effective way to communicate that 
program's standards, policies, and procedures through a training 
program or in another practical manner which explains the requirements 
under the program.
* * * * *

PART 485--CONDITIONS OF PARTICIPATION: SPECIALIZED PROVIDERS

0
17. The authority citation for part 485 is revised to read as follows:

     Authority:  42 U.S.C. 1302 and 1395(hh)).

0
18. Section 485.645 is amended by revising paragraphs (d)(3) and (5) to 
read as follows:


Sec.  485.645  Special requirements for CAH providers of long-term care 
services (``swing-beds'').

* * * * *
    (d) * * *
    (3) Freedom from abuse, neglect and exploitation (Sec.  
483.12(a)(1) and (2), (a)(3)(i) and (ii), (a)(4), (b)(1) and (2), and 
(c)(1) through (6) of this chapter).
* * * * *
    (5) Social services (Sec. Sec.  483.40(c) and 483.70(p) of this 
chapter).
* * * * *

PART 488--SURVEY, CERTIFICATION AND ENFORCEMENT PROCEDURES

0
19. The authority citation for part 488 continues to read as follows:

    Authority:  42 U.S.C 1302 and 1395hh.

0
20. Section 488.331 is amended by revising paragraph (b) to read as 
follows:

[[Page 34768]]

Sec.  488.331  Informal dispute resolution.

* * * * *
    (b)(1) Informal dispute resolution will be completed within 60 days 
of the facility's request to dispute the survey findings if the request 
by the facility is timely. Failure of the state or CMS, as appropriate, 
to complete informal dispute resolution timely cannot delay the 
effective date of any enforcement action against the facility.
    (2) A facility may not seek a delay of any enforcement action 
against it on the grounds that informal dispute resolution has not been 
completed before the effective date of the enforcement action, except 
that the results of the survey will not be uploaded into the CMS 
nursing home survey and certification database and/or used for the 
purposes of the CMS ``Nursing Home Compare'' website to calculate the 
facility's 5-star rating until the informal dispute resolution or the 
independent informal dispute resolution process is complete.
* * * * *
0
21. Section 488.431 is amended by revising paragraphs (a)(2) and 
(a)(4)(i) to read as follows:


Sec.  488.431  Civil money penalties imposed by CMS and independent 
informal dispute resolution: for SNFs, dually-participating SNF/NFs, 
and NF-only facilities.

    (a) * * *
    (2) Generate a written record prior to the collection of the 
penalty. The state, or CMS, as applicable, will provide the facility 
with a written notification of the independent reviewer's 
recommendation and the final decision, including a rationale for that 
decision.
* * * * *
    (4) * * *
    (i) A component of an umbrella state agency provided that the 
component is organizationally separate from the State survey agency and 
has a specific understanding of Medicare and Medicaid program 
requirements.
* * * * *
0
22. Section 488.432 is amended by revising paragraph (c)(2) to read as 
follows:


Sec.  488.432  Civil money penalties imposed by the State: NF-only.

* * * * *
    (c) * * *
    (2) If a facility waives its right to a hearing as specified in 
Sec.  488.436, the state initiates collection of civil money penalty 
imposed per instance of noncompliance after 60 days and the state has 
not received a timely request for a hearing.
* * * * *
0
23. Section 488.436 is amended by revising paragraph (a) to read as 
follows:


Sec.  488.436  Civil money penalties: Waiver of hearing, reduction of 
penalty amount.

    (a) Constructive waiver of a hearing. A facility is deemed to have 
waived its right to a hearing after 60 days if CMS has not received a 
request for a hearing from the facility.
* * * * *
0
24. Section 488.442 is amended by revising paragraph (a)(2) 
introductory text to read as follows:


Sec.  488.442  Civil money penalties: Due date for payment of penalty.

    (a) * * *
    (2) After the facility waives its right to a hearing in accordance 
with Sec.  488.436(a). Except as provided for in Sec.  488.431, a civil 
money penalty is due 75 days after the notice of the penalty and a 
hearing request was not received when:
* * * * *

    Dated: June 24, 2019.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.

    Dated: June 26, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
[FR Doc. 2019-14946 Filed 7-16-19; 4:15 pm]
BILLING CODE 4120-01-P