Additional Policy and Regulatory Revisions in Response to the COVID-19 Public Health Emergency, 71142-71205 [2020-24332]
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Federal Register / Vol. 85, No. 216 / Friday, November 6, 2020 / Rules and Regulations
DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[TD 9931]
Office of the Secretary
31 CFR Part 33
RIN 1545–BP97
DEPARTMENT OF LABOR
Employee Benefits Security
Administration
29 CFR Part 2590
RIN 1210–AB98
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
42 CFR Parts 410, 411, 414, 417, 433,
and 510
Office of the Secretary
45 CFR Parts 147, 155, and 182
[CMS–9912–IFC]
RIN 0938–AU35
Additional Policy and Regulatory
Revisions in Response to the COVID–
19 Public Health Emergency
Centers for Medicare &
Medicaid Services (CMS), Department
of Health and Human Services (HHS);
Internal Revenue Service, Department of
the Treasury; Employee Benefits
Security Administration, Department of
Labor.
ACTION: Interim final rule with request
for comments.
AGENCY:
SUMMARY: This interim final rule with
request for comments (IFC) discusses
CMS’s implementation of section 3713
of the Coronavirus Aid, Relief, and
Economic Security Act (CARES Act),
which established Medicare Part B
coverage and payment for Coronavirus
Disease 2019 (COVID–19) vaccine and
its administration. This IFC implements
requirements in the CARES Act that
providers of COVID–19 diagnostic tests
make public their cash prices for those
tests and establishes an enforcement
scheme to enforce those requirements.
This rule also establishes an add-on
payment for cases involving the use of
new COVID–19 treatments under the
Medicare Inpatient Prospective Payment
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System (IPPS). This IFC provides for
separate payment for new COVID–19
treatments under the Outpatient
Prospective Payment System (OPPS) for
the remainder of the PHE for COVID–19
when these treatments are provided at
the same time as a Comprehensive
Ambulatory Payment Classification (C–
APC) service. This rule also interprets
and implements the requirement to
maintain Medicaid beneficiary
enrollment in order to receive the
temporary increase in Federal funding
in the Families First Coronavirus
Response Act (FFCRA). This IFC
modifies policies of the Comprehensive
Care for Joint Replacement (CJR) model
and adds technical changes to
accommodate these policy changes.
Specifically, we are extending
Performance Year (PY) 5 by adding 6
months, creating an episode-based
extreme and uncontrollable
circumstances COVID–19 policy,
providing two reconciliation periods for
PY 5, and adding DRGs 521 and 522 for
hip and knee procedures. This rule also
amends regulations regarding coverage
of preventive health services to
implement section 3203 of the CARES
Act, which shortens the timeframe
within which non-grandfathered group
health plans and health insurance
issuers offering non-grandfathered
group or individual health insurance
coverage must begin to cover without
cost sharing qualifying coronavirus
preventive services, including
recommended COVID–19
immunizations. This IFC also revises
regulations to set forth flexibilities in
the public notice requirements and post
award public participation requirements
for State Innovation Waivers under
section 1332 of the Patient Protection
and Affordable Care Act (PPACA)
during the public health emergency for
COVID–19.
DATES: Effective date: These regulations
are effective on November 2, 2020,
except for amendatory instructions 36
and 37, which are effective on January
1, 2021.
Applicability date: Except as
otherwise specified in this paragraph,
these regulations are applicable from
November 2, 2020, until the end of the
public health emergency for COVID–19
as determined by the HHS Secretary.
The regulations at 42 CFR 410.57,
410.152, 410.160, 411.15, 414.701,
414.707, 414.900, and 414.904 and at 42
CFR part 510 (other than 42 CFR
510.300(a)(1)(i) and (iii)) are applicable
November 2, 2020. Because the
requirement at section 6008(b)(3) of the
Families First Coronavirus Response
Act (FFCRA) is not limited to the
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duration of the public health emergency
for COVID–19, regulations at 42 CFR
part 433, subpart G, apply from
November 2, 2020, through the end of
the last month of the public health
emergency for COVID–19 in accordance
with section 6008(b)(3) of the Families
First Coronavirus Response Act.
Regulations at 42 CFR 510.300(a)(1)(i)
and (a)(1)(iii) are applicable October 1,
2020.
Comment date: To be assured
consideration, comments must be
received at one of the addresses
provided below, no later than 5 p.m. on
January 4, 2021.
ADDRESSES: In commenting, please refer
to file code CMS–9912–IFC.
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–9912–IFC, P.O. Box 8016,
Baltimore, MD 21244–8016.
Please allow sufficient time for mailed
comments to be received before the
close of the comment period.
3. By express or overnight mail. You
may send written comments to the
following address ONLY: Centers for
Medicare & Medicaid Services,
Department of Health and Human
Services, Attention: CMS–9912–IFC,
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:
Laura Kennedy, (410) 786–3377, for
discussion related to COVID–19 vaccine
and administration payment provided
under Medicare Part B.
Lina Rashid, (443) 902–2823, or
Michelle Koltov, (301) 492–4225,
Centers for Medicare & Medicaid
Services, Department of Health and
Human Services, Services, Kimberly
Koch, (202) 622–0854, Department of
the Treasury, for issues related to State
Innovation Waivers Policy and
Regulatory Revisions in Response to the
COVID–19 Public Health Emergency.
Dr. Terri Postma or Rhonda Sheppard,
(410) 786–8465, or via email at
COVID19CashPrice@cms.hhs.gov, for
provisions related to Price Transparency
for COVID–19 Diagnostic Testing.
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Federal Register / Vol. 85, No. 216 / Friday, November 6, 2020 / Rules and Regulations
Cristina Nigro, (410) 786–7763, for
issues related to the Medicare Inpatient
Prospective Payment System (IPPS)
New COVID–19 Treatments Add-on
Payment (NCTAP) for the remainder of
the public health emergency.
David Mlawsky, (410) 786–1565,
Centers for Medicare & Medicaid
Services, Department of Health and
Human Services, Elizabeth Schumacher,
(202) 693–8335, Employee Benefits
Security Administration, Department of
Labor, Dara Alderman, (202) 317–5500,
Internal Revenue Service, Department of
the Treasury, for issues related to Rapid
Coverage of Preventive Services for
Coronavirus.
Stephanie Bell, (410) 786–0617, for
issues related to the temporary increase
in Federal Medicaid funding.
Bobbie Knickman, (410) 786–4161;
Heather Holsey, (410) 786–0028; Sarah
Mioduski, (410) 786–2014 or email
CJR@cms.hhs.gov for the
Comprehensive Care for Joint
Replacement Model.
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://
regulations.gov. Follow the search
instructions on that website to view
public comments.
Background
The United States is responding to an
outbreak of respiratory disease caused
by a novel coronavirus that was first
detected in China and has now been
detected in more than 190 countries
internationally, and all 50 States, the
District of Columbia, and U.S.
territories. The virus has been named
‘‘severe acute respiratory syndrome
coronavirus 2’’ (‘‘SARS-CoV–2’’) and the
disease it causes has been named
‘‘coronavirus disease 2019’’ (‘‘COVID–
19’’).
On January 30, 2020, the International
Health Regulations Emergency
Committee of the World Health
Organization (WHO) declared the
outbreak a ‘‘Public Health Emergency of
International Concern.’’ On January 31,
2020, pursuant to section 319 of the
Public Health Service (PHS) Act (42
U.S.C. 247d), the Health and Human
Services Secretary (the Secretary)
determined that a public health
emergency (PHE) exists for the United
States to aid the nation’s health care
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community in responding to COVID–19
(hereafter referred to as the PHE for
COVID–19). On March 11, 2020, the
WHO publicly declared COVID–19 a
pandemic. On March 13, 2020,
President Donald J. Trump (the
President) declared the COVID–19
pandemic a national emergency.
Effective October 23, 2020, the Secretary
renewed the January 31, 2020
determination that was previously
renewed on April 21, 2020 and July 23,
2020 that a PHE exists and has existed
since January 27, 2020.
The Administration is committed to
ensuring that Americans have access to
a COVID–19 vaccine through Operation
Warp Speed, a partnership among
components of the HHS, including the
Centers for Disease Control and
Prevention (CDC), the Food and Drug
Administration (FDA), the National
Institutes of Health (NIH), and the
Biomedical Advanced Research and
Development Authority (BARDA).
Operation Warp Speed engages with
private firms and other Federal
agencies, including the Department of
Defense (DoD), Department of
Agriculture, the Department of Energy,
and the Department of Veterans Affairs.
Through the work of the Federal
Government and the private sector,
Operation Warp Speed seeks to
accelerate the development,
manufacture, and distribution of a
COVID–19 vaccine to the American
people.
The CDC has reported that some
people are at higher risk of severe
illness from COVID–19.1 These higherrisk categories include:
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• Residents of Long Term Care (LTC)
facilities, including nursing homes,
Intermediate Care Facilities for
Individuals with Intellectual and
Developmental Disabilities (ICF/IIDs),
inpatient psychiatric and substance
abuse treatment facilities including
Institutions for Mental Disease (IMDs) &
Psychiatric Residential Treatment
Facilities (PRTFs), assisted living
facilities, group homes for individuals
with developmental disabilities and
board-and-care facilities.3
As the health care community
implements and updates recommended
prevention and control practices,
regulatory agencies operating under
appropriate waiver authority granted by
the PHE for COVID–19 are also working
to revise and implement regulations that
support these health care community
infection prevention and treatment
practices. Based on the current and
projected increases in the incidence rate
of COVID–19 in the US, observed
fatalities in the older adult population,
and the impact on health care workers
at increased risk due to treating special
populations, CMS 4 is reviewing and
revising regulations, as appropriate, to
offer states, providers, suppliers, and
group health plans and health insurance
issuers additional flexibilities in
furnishing and providing services to
combat the PHE for COVID–19 and to
address and minimize the unique
impact of the PHE for COVID–19 on
other regulatory provisions.
CMS addressed additional policies in
three previous interim final rules with
comment period (IFCs). The ‘‘Medicare
and Medicaid Programs; Policy and
Regulatory Revisions in Response to the
COVID–19 Public Health Emergency’’
IFC appeared in the April 6, 2020
Federal Register (85 FR 19230) with an
effective date of March 31, 2020, and the
‘‘Medicare and Medicaid Programs,
Basic Health Program, and Exchanges;
Additional Policy and Regulatory
Revisions in Response to the COVID–19
Public Health Emergency and Delay of
Certain Reporting Requirements for the
Skilled Nursing Facility Quality
Reporting Program’’ IFC appeared in the
May 8, 2020 Federal Register (85 FR
27550) with an effective date of May 8,
2020. The ‘‘Medicare and Medicaid
Programs, Clinical Laboratory
Improvement Amendments, and Patient
Protection and Affordable Care Act:
Additional Policy and Regulatory
Revisions in Response to the COVID–19
Public Health Emergency’’ IFC appeared
in the September 2, 2020 Federal
Register (85 FR 54820) with an effective
date of September 2, 2020.
This IFC implements a number of
measures intended to further the
Administration’s commitment to ensure
every American has timely access to a
COVID–19 vaccine without any out-ofpocket expenses, no matter their source
of coverage, or whether they are covered
at all.
1 https://www.cdc.gov/mmwr/volumes/69/wr/
mm6915e3.htm.
2 https://www.cdc.gov/mmwr/volumes/69/wr/
mm6924e2.htm?s_cid=mm6924e2_w.
3 https://www.cdc.gov/coronavirus/2019-ncov/
cases-updates/summary.html.
4 Throughout this IFC, unless otherwise specified,
‘‘we’’ and ‘‘our’’ refer to CMS only.
• Older adults, with risk increasing by age.
• People who have serious chronic
medical conditions such as:
++ Obesity.
++ Cardiovascular disease.
++ Diabetes mellitus.
++ Hypertension.
++ Chronic lung disease.
++ Neurologic/Neurodevelopmental
disability.2
++ Immunocompromised individuals.
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In this IFC, CMS discusses Section
3713 of the Coronavirus Aid, Relief, and
Economic Security (CARES) Act which
added the COVID–19 vaccine and its
administration to section 1861(s)(10)(A)
of the Social Security Act (the Act) in
the same subparagraph as the flu and
pneumococcal vaccines and their
administration. It also specified that
under Medicare Part B, beneficiaries can
receive a COVID–19 vaccination
(vaccine and administration) with no
cost sharing (deductible or copayment).
In this IFC, HHS and the Departments
of Labor and the Treasury (referred to
collectively as ‘‘the Departments’’)
clarify certain aspects of coverage of
preventive services without cost sharing
under the current regulations
implementing section 2713 of the Public
Health Service (PHS) Act, as added by
PPACA and incorporated into the
Employee Retirement Income Security
Act of 1974 (ERISA) by section 715 of
ERISA and into the Internal Revenue
Code (the Code) by section 9815 of the
Code. The Departments also amend
those regulations to implement the
unique requirements related to rapid
coverage of qualifying coronavirus
preventive services under section 3203
of the CARES Act. Specifically, this IFC
clarifies that plans and issuers subject to
section 2713 of the PHS Act must cover
without cost sharing recommended
immunizations as well as the
administration of such immunizations,
regardless of how the administration is
billed. This IFC also defines qualifying
coronavirus preventive services
consistent with the definition provided
in section 3203 of the CARES Act and
clarifies that plans and issuers subject to
section 2713 of the PHS Act must cover
recommended immunizations for
COVID–19 that are qualifying
coronavirus preventive services, even if
not listed for routine use on the
Immunization Schedules of the CDC.
Due to the urgent need to ensure
coverage of and access to qualifying
coronavirus preventive services, and to
ensure that participants, beneficiaries,
and enrollees can access qualifying
coronavirus preventive services on the
expedited basis specified by statute, this
IFC also provides that during the PHE
for COVID–19, plans and issuers must
cover, without cost sharing, qualifying
coronavirus preventive services,
regardless of whether such services are
delivered by an in-network or out-ofnetwork provider. This coverage is
required to be provided within 15
business days after the date the United
States Preventive Services Task Force
(USPSTF) or the Advisory Committee
on Immunization Practices of the CDC
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(ACIP) makes an applicable
recommendation relating to a qualifying
coronavirus preventive service.
Section 3202(b) of the CARES Act
establishes a requirement to publicize
cash prices for COVID–19 diagnostic
testing during the PHE. For purposes of
implementing section 3202(b) of the
CARES Act, this IFC adds a new 45 CFR
part 182, including (1) definitions of
‘‘provider of a diagnostic test for
COVID–19’’ (or ‘‘provider’’), ‘‘COVID–19
diagnostic test,’’ and ‘‘cash price,’’ and
(2) requirements for posting cash price
information on the internet, or upon
request and through signage (if
applicable) if the provider does not have
its own website. This IFC gives CMS
discretion to take any of the following
actions, which generally, but not
necessarily, will occur in the following
order if CMS determines the provider is
noncompliant with section 3202(b)(1) of
the CARES Act and the requirements of
§ 182.40:
• Provide a written warning notice to
the provider of the specific violation(s).
• Request that a provider submit and
comply with a corrective action plan
(CAP) under § 182.60 if its
noncompliance is not corrected after a
warning notice.
• Impose a civil monetary penalty
(CMP) on the provider if the provider
fails to respond to CMS’ request to
submit a CAP or to comply with the
requirements of a CAP approved by
CMS.
This IFC creates a New COVID–19
Treatments Add-on Payment (NCTAP)
under the Inpatient Prospective
Payment System (IPPS) for COVID–19
cases that meet certain criteria. We
believe that as drugs and biological
products become available and are
authorized or approved by FDA for the
treatment of COVID–19 in the inpatient
setting, it is appropriate to increase the
current IPPS payment amounts to
mitigate any potential financial
disincentives for hospitals to provide
new COVID–19 treatments during the
PHE. Therefore, effective for discharges
occurring on or after the effective date
of this rule and until the end of the PHE
for COVID–19, this IFC establishes the
NCTAP to pay hospitals the lesser of (1)
65 percent of the operating outlier
threshold for the claim or (2) 65 percent
of the amount by which the costs of the
case exceed the standard DRG payment,
including the adjustment to the relative
weight under section 3710 of the CARES
Act, for certain cases that include the
use of a drug or biological product
currently authorized or approved for
treating COVID–19. The NCTAP will not
be included as part of the calculation of
the operating outlier payments.
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This IFC provides for separate
payment for New COVID–19 Treatments
under the Outpatient Prospective
Payment System (OPPS) for the
remainder of the PHE for COVID–19
when these treatments are provided at
the same time as a Comprehensive
Ambulatory Payment Classification (C–
APC) service. Although we do not
expect that many beneficiaries would
both receive a primary C–APC service
and a drug or biological for treating
COVID–19 on the same claim, we
nonetheless believe that as drugs or
biologicals become available and are
authorized or approved for the
treatment of COVID–19 in the outpatient
setting, it would be appropriate to
mitigate any potential financial
disincentives for hospitals to provide
these new treatments during the PHE for
COVID–19. Therefore, effective for
services furnished on or after the
effective date of this rule and until the
end of the PHE, CMS is creating an
exception to its OPPS C–APC policy to
ensure separate payment for new
COVID–19 treatments that meet certain
criteria.
This IFC adds a new subpart G,
Temporary FMAP Increase During the
Public Health Emergency for COVID–19,
to 42 CFR part 433, including a new
§ 433.400. This new provision interprets
and implements section 6008(b)(3) of
the FFCRA to require states, as a
condition for receiving the temporary
FMAP increase described at section
6008(a) of the FFCRA, to maintain
beneficiary enrollment with specified
protections. The terms of new § 433.400
are effective immediately upon display
of this rule. CMS’ previous
interpretation, described in this
preamble and in the FAQs cited therein,
continues to apply up to the date this
rule is effective.
This IFC modifies policies of the
Comprehensive Care for Joint
Replacement (CJR) model and adds
technical changes to accommodate these
policy changes. Specifically, we are
extending Performance Year (PY) 5 an
additional 6 months, creating an
episode-based extreme and
uncontrollable circumstances COVID–
19 policy, providing two reconciliation
periods for PY 5, and adding DRGs 521
and 522 for hip and knee procedures.
This IFC provides for flexibilities in
the public notice requirements for a
State Innovation Waiver (also referred to
as a section 1332 waiver) described in
section 1332 of PPACA that apply
during the PHE for COVID–19.
Specifically, this IFC gives the Secretary
of HHS and the Secretary of the
Treasury the authority to modify, in
part, the public notice procedures to
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expedite a decision on a proposed
waiver request that is submitted or
would otherwise become due during the
PHE for COVID–19. This IFC also gives
these Secretaries the authority to
modify, in part, the post-award public
notice requirements for an approved
waiver request that would otherwise
take place or become due during the
PHE for COVID–19.
II. Provisions of the Interim Final
Rule—Department of Health and
Human Services
A. Medicare Coding and Payment for
COVID–19 Vaccine
1. Summary
This section of this IFC discusses
CMS’s implementation of section 3713
of the CARES Act, which established
Medicare Part B coverage and payment
for a COVID–19 vaccine and its
administration. While section 3713(e) of
the CARES Act authorizes CMS to
implement section 3713 via ‘‘program
instruction or otherwise,’’ we believe it
is important to clarify in this IFC our
interpretation of Section 3713 and
ensure the public is aware of our plans
to ensure timely Medicare Part B
coverage and payment for COVID–19
vaccine and its administration.
2. Background on Medicare Part B
Coverage, Payment, Coding and Billing
for Vaccines
As required under section
1842(o)(1)(A)(iv) of the Act, the
Medicare Part B payment allowance
limits for influenza, pneumococcal, and
hepatitis B virus (HBV) vaccines are 95
percent of the Average Wholesale Price
(AWP) as reflected in the published
compendia except where the vaccine is
furnished in a hospital outpatient
department, Rural Health Clinic (RHC),
or Federally Qualified Health Center
(FQHC), skilled nursing facility, and
home health. Where the vaccine is
furnished in these settings, payment for
the vaccine is based on reasonable cost.
For preventive vaccines described in
section 1861(s)(10) of the Act, Medicare
pays for both the vaccine and its
administration. Under sections
1833(a)(1)(B), annual Part B deductible
and coinsurance amounts do not apply
for these vaccinations. In 2020, payment
for vaccines is based on the 95 percent
of the AWP for a particular vaccine
product except where furnished in the
settings for which payment is based on
reasonable cost. For example, for the
2020–2021 influenza season, payment
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limits for adult flu vaccines range from
about $19 to $61 per adult dose.5
We note that in the Calendar Year
2021 Physician Fee Schedule Proposed
Rule (85 FR 50162–50163), CMS
proposed to increase the Medicare
payment rate for administration of the
flu, pneumococcal or HBV vaccine
furnished by a physician, non-physician
practitioner, or other supplier. CMS will
address public comments on the
proposal and establish payment rates for
administration of these vaccines by a
physician, non-physician practitioner,
or other supplier in the Calendar Year
2021 Physician Fee Schedule Final
Rule, which will be issued later this
year. Note that the payment rates for
administration of these preventive
vaccines established in the CY 2021
Physician Fee Schedule final rule do not
apply when the vaccine is furnished by
the providers and suppliers paid for
administration under reasonable cost.
Under the CY 2021 OPPS proposed rule,
CMS proposed to assign the HCPCS
codes for administration of the
influenza, pneumococcal, and hepatitis
B vaccines to APC 5691, Level 1 Drug
Administration. See Addendum C to the
CY 2021 OPPS/ASC proposed rule.
Payment amounts for these preventive
vaccines and their administration are
not adjusted based on product-specific
factors.
Generally, providers and suppliers
bill for the vaccine and the vaccine
administration separately using
different codes. For example, many
vaccine products are identified by AMA
CPT codes in the 90000 series, while
others are identified by Level II HCPCS
codes, usually beginning with the letter
Q. Vaccine administration services are
described by the types of codes used to
describe professional and/or hospital
outpatient services, and are typically
identified by a G code for Medicare
billing, or by a different AMA CPT code
in the 90000 series.
Many providers, professionals, and
other suppliers can bill Medicare for the
preventive vaccines and vaccine
administration they furnish using
claims rules similar to those that apply
to the other Medicare covered items and
services. Additionally, certain entities
can enroll under Medicare as mass
immunizers to offer and bill Medicare
for flu vaccinations, pneumococcal
vaccinations, or both to large groups of
Medicare beneficiaries under roster
billing. A mass immunizer may be
enrolled in Medicare as another type of
5 https://www.cms.gov/Medicare/Medicare-Feefor-Service-Part-B-Drugs/
McrPartBDrugAvgSalesPrice/VaccinesPricing,
accessed September 29, 2020.
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provider or supplier such as a
physician, non-physician practitioner,
hospital outpatient department, home
health agency or skilled nursing facility.
An entity or individual that does not
otherwise qualify as a Medicare
provider or supplier but wishes to
furnish mass immunization services
may be eligible to enroll in Medicare as
a ‘‘Mass Immunization Roster Biller’’ via
the Form CMS–855 enrollment
application (Medicare Enrollment
Application: Clinics/Group Practices
and Certain Other Suppliers; OMB
Control No.: 0938–0685; Expires 12/21).
Aside from meeting all applicable
enrollment requirements in 42 CFR part
424, subpart P (and as outlined in CMS
Pub. 100–08 (Program Integrity Manual),
chapter 10, section 10.2.4), a party
enrolled only as a mass immunization
roster biller must comply with the
following: (1) May not bill Medicare for
any services other than pneumococcal
pneumonia vaccines (PPVs), influenza
virus vaccines, and their administration;
(2) must submit claims through the
roster biller or centralized biller process;
and (3) the enrolled entity or individual
must meet all applicable state and local
licensure or certification requirements.
In other words, an enrolled mass
immunizer roster biller may only roster
bill Medicare for the services described
in the previous sentence. (For more
information on the enrollment process
for mass immunization roster billers, see
https://www.cms.gov/Medicare/
Provider-Enrollment-and-Certification/
Become-a-Medicare-Provider-orSupplier and/or contact your local Part
A/B Medicare Administrative
Contractor.)
For entities that are already enrolled
Medicare providers and suppliers, these
entities would contact their MAC if they
plan to submit claims as a mass
immunizer. Mass immunizers may
submit claims for immunizations
(vaccine and administration) on roster
bills that include a limited set of
information on each beneficiary and the
vaccine(s) they were given. We note that
HBV vaccinations require an assessment
of a patient’s risk of contracting
hepatitis B; they require a physician’s
order and cannot be roster billed by
mass immunizers.
3. Provisions of the CARES Act
Section 3713 of the CARES Act
provides for coverage of the COVID–19
vaccine under Part B of the Medicare
program without any beneficiary cost
sharing. Specifically, section 3713
amended section 1861(s)(10)(A) of the
Act to include COVID–19 vaccine and
its administration. The amendments
made are effective on the date of
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enactment and apply to a COVID–19
vaccine beginning on the date that such
vaccine is licensed under section 351 of
the PHS Act (42 U.S.C. 262). Section
3713(e) of the CARES Act further states
that the Secretary may implement the
provisions of, and the amendments
made by, this section by program
instruction or otherwise.
Under section 564 of the Federal
Food, Drug, and Cosmetic Act (FD&C
Act), the Commissioner of Food and
Drugs, as delegated authority by the
Secretary, may authorize, during the
effective period of a declaration of
emergency or threat justifying
emergency authorized use, the
introduction into interstate commerce of
unapproved medical products or
unapproved uses of approved medical
products to diagnose, treat, or prevent
serious or life-threatening diseases or
conditions caused by chemical,
biological, radiological and nuclear
defense (CBRN) threat agents when
there are no adequate, approved, and
available alternatives. On March 27,
2020, on the basis of his determination
of a PHE that has a significant potential
to affect national security or the health
and security of United States citizens
living abroad involving COVID–19, the
Secretary declared that circumstances
exist justifying the authorization of
emergency use of drugs and biological
products during the COVID–19
pandemic (85 FR 18250). Pursuant to
this declaration, the Commissioner of
Food and Drugs, as delegated authority
by the Secretary, may issue an
emergency use authorization (EUA) for
a drug or biological product if, after
consultation with officials such as the
Director of the CDC and the Director of
the NIH, to the extent feasible and
appropriate, the Commissioner
reasonably concludes that, among other
criteria, based on the totality of
available scientific evidence, the
product may be effective in diagnosing,
treating or preventing such disease or
condition, and the product’s known and
potential benefits when used to
diagnose, prevent, or treat such disease
or condition, outweigh its known and
potential risks.
FDA’s June 2020 guidance to industry
titled ‘‘Development and Licensure of
Vaccines to Prevent COVID–19’’ 6 and
October 2020 guidance to industry titled
‘‘Emergency Use Authorization for
Vaccines to Prevent COVID–19’’ 7 state
6 Available at https://www.fda.gov/regulatoryinformation/search-fda-guidance-documents/
development-and-licensure-vaccines-prevent-covid19, accessed September 30, 2020.
7 Available at https://www.fda.gov/regulatoryinformation/search-fda-guidance-documents/
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that issuance of an EUA may be
appropriate for a COVID–19 vaccine, for
which there is adequate manufacturing
information, once studies have
demonstrated the safety and
effectiveness of the vaccine in a clear
and compelling manner, but before the
submission and/or formal review of the
biologics license application for the
vaccine. These guidance documents
state that in the case of vaccines being
developed for the prevention of COVID–
19, any assessment regarding an EUA
would be made on a case by case basis
considering the target population, the
characteristics of the product, the
preclinical and human clinical study
data on the product, and the totality of
the relevant available scientific
evidence. The FDA has made clear in its
October 2020 guidance to industry that
for a COVID–19 vaccine for which there
is adequate information to ensure its
quality and consistency, issuance of an
EUA would require a determination by
FDA that the vaccine’s benefits
outweigh its risks based on data from at
least one well-designed Phase 3 clinical
trial that demonstrates the vaccine’s
safety and efficacy in a clear and
compelling manner. Because the
vaccine would be intended for
administration to healthy people as a
prophylactic measure, there must be a
higher degree of certainty about the
risks and benefits of the product than
needed for EUAs for medical products
intended for treatment of sick patients.
There are no historical examples in
which Medicare has covered vaccines
for which an EUA was issued by FDA.
We recall that during the PHE involving
the 2009 H1N1 flu outbreak,8 Influenza
A (H1N1) 2009 Monovalent Vaccine was
approved by the FDA on September 15,
2009 on the basis of a supplement to the
applicant’s biologics license application
(BLA) for influenza virus vaccine.9 In
our review of PHEs, there are no
circumstances in which a vaccine
product authorized for emergency use
has been covered or paid for by
Medicare.
As discussed previously, the CDC
recognizes that the categories of people
at higher risk of severe illness from
COVID–19 include older adults (with
risk increasing by age), people with
chronic conditions such as
cardiovascular disease or diabetes, and
emergency-use-authorization-vaccines-preventcovid-19, accessed October 9, 2020.
8 Available at https://www.phe.gov/emergency/
news/healthactions/phe/Pages/h1n1.aspx, accessed
on October 14, 2020.
9 Available at https://www.fda.gov/vaccinesblood-biologics/vaccines/influenza-h1n1-2009monovalent-vaccine-novartis-vaccines-anddiagnostics-limited, accessed October 14, 2020.
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residents of long-term care facilities.10
The Medicare population includes
many beneficiaries who are in these
higher-risk categories, primarily because
most, (over 85 percent) 11 Medicare
beneficiaries are over 65 years old.
Given the high risk nature of the
Medicare population, the circumstances
of this nationwide pandemic, and FDA’s
guidance that an EUA may be
appropriate for a COVID–19 vaccine
prior to its licensure if there is a
demonstration of safety and efficacy in
a clear and compelling manner from at
least one Phase 3 clinical trial, we
believe it is appropriate for Medicare to
consider any EUA under section 564 of
the FD&C Act issued for a COVID–19
vaccine during the PHE to be
tantamount to a license under section
351 of the PHS Act for the sole purpose
of considering such a vaccine to be
described in section 1861(s)(10)(A) of
the Act. That is, even though section
3713 of the CARES Act refers to a
COVID–19 vaccine ‘‘licensed under
section 351 of the PHS Act,’’ CMS could
consider any vaccine for which FDA
issued an EUA during the PHE, when
furnished consistent with terms of the
EUA, to be eligible for Medicare
coverage and payment. We consider our
interpretation of section 3713(d) of the
CARES Act to be consistent with
Congress’ intent to provide for Medicare
coverage without deductible or
coinsurance of any COVID–19 vaccine
(and its administration) that FDA has
authorized to be introduced into
interstate commerce, which would be
the case both for a vaccine for which
emergency use is authorized under
section 564 of the FD&C Act and for a
vaccine that is licensed under section
351 of the PHS Act. Our interpretation
also would be consistent with Congress’
general intent in the CARES Act and
other recent legislation to provide for
rapid coverage of COVID–19 vaccines.
We note that section 3713(e) of the
CARES Act permits CMS to implement
the changes made by that section
through ‘‘program instruction or
otherwise,’’ and we intend to issue any
necessary instructions for Medicare
providers and suppliers expediently in
order to ensure beneficiary access to
COVID–19 vaccines as quickly as
possible.
10 https://www.cdc.gov/coronavirus/2019-ncov/
need-extra-precautions/?CDC_AA_
refVal=https%3A%2F%2F
www.cdc.gov%2Fcoronavirus%2F2019ncov%2Fneed-extra-precautions%2Fpeople-atincreased-risk.html.
11 https://www.cms.gov/Research-Statistics-Dataand-Systems/Statistics-Trends-and-Reports/
Beneficiary-Snapshot/Downloads/Bene_
Snaphot.pdf.
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4. Implementation and Methods of
Coding and Payment for COVID–19
Vaccine and Administration
Section 3713 of the CARES Act added
the COVID–19 vaccine and its
administration to section 1861(s)(10)(A)
of the Act in the same subparagraph as
the flu and pneumococcal vaccines and
their administration. As such, the
Medicare allowed amount for the
COVID–19 vaccine will also be 95
percent of the average wholesale price
(or reasonable cost, for example under
OPPS).
Because COVID–19 vaccines are being
developed rapidly and systems to
operationalize payment of
administration will need to be
implemented quickly to ensure
beneficiary access, we also recognize the
need to establish coding and payment
for COVID–19 vaccine and
administration under Medicare Part B.
Because there are many product-specific
factors that are still unknown, including
the possibility of differential costs
associated with each COVID–19 vaccine
product and storage and administration
requirements, we anticipate establishing
a unique administration code for each
COVID–19 vaccine product. We believe
it is imperative that coding and payment
be in place as soon as possible after
COVID–19 vaccines become available.
We anticipate establishing specific
coding and payment rates through
technical direction to the MACs,
including instructions to make this
information available to the public. We
also anticipate posting information on
coding, payment, and billing for
COVID–19 vaccines and vaccine
administration on the CMS website.
This approach will maintain public
transparency while allowing CMS to
pay appropriately for particular
vaccines and vaccine administration as
quickly as practicable once they are
authorized or licensed for use by FDA.
We anticipate that payment rates for the
administration of other Part B
preventive vaccines and related
services, such as the flu and
pneumococcal vaccines, would serve to
inform the payment rates for
administration of COVID–19 vaccines.
CMS ordinarily establishes Medicare
payment rates for particular items and
services, through notice-and-comment
rulemaking. Because of the unique
circumstances of the PHE for COVID–19
pandemic and the anticipated, specific
conditions for the entry of COVID–19
vaccine products into the marketplace,
we believe it is necessary to initially
dispense with the rulemaking process in
order to make Medicare payment
available in a timely manner to ensure
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widespread access to the new vaccines.
Therefore, as soon as practicable after
the authorization or licensure of each
COVID–19 vaccine product by FDA, we
will announce the interim coding and a
payment rate for its administration (or,
in the case of the OPPS, an APC
assignment for each vaccine product’s
administration code), taking into
consideration any product-specific costs
or considerations involved in furnishing
the service. Such consideration may be
necessary, specifically for COVID–19
vaccines in the context of the pandemic,
in order to ensure that health care
providers can offer prompt access to
vaccination for a large number of people
as quickly as possible. We then
anticipate addressing coding and
payment rates for administration of the
COVID–19 vaccine products through
future notice-and-comment rulemaking.
In other words, the approach to
payment and coding described in this
IFC will ensure efficient and timely
beneficiary access to COVID–19 vaccine
products, that for public health
purposes may need to be administered
to a large number of people during a
compressed period of time, until further
rulemaking, such as annual rulemaking
under the Medicare Physician Fee
Schedule, is possible.
Given that the COVID–19 vaccine and
administration was added to the same
subparagraph as the flu and
pneumococcal vaccines and
administration under section
1861(s)(10)(A) of the Act, we believe it
would be appropriate to use billing
processes for COVID–19 vaccinations
that are similar to those in place for flu
and pneumococcal vaccinations. With
the pressing need to ensure broad access
to a COVID–19 vaccine, it would be
appropriate to allow COVID–19
vaccinations to be provided through the
mass immunization and roster billing
process that is in place for flu and
pneumococcal vaccinations. We
recognize that, at this time, there is very
limited detailed information on COVID–
19 vaccines and their administration
and that information on these vaccines
is likely to evolve as they reach the
market and then experience with them
is gained. At this time, we believe that
the COVID–19 vaccines will be
administered as one or two parenteral
doses, thus we believe that using the
Part B influenza vaccination approach
that permits certain providers and mass
immunization to bill for the product
strikes a balance between the need to
vaccinate many millions of Medicare
patients promptly and the lack of
detailed information about particular
COVID–19 vaccine products. Although
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71147
influenza vaccination is generally only
given once each flu season, CMS has
contemplated how to respond to
pandemics where payment for
additional doses of an influenza vaccine
during a season may be required. Thus,
a two dose initial COVID–19
vaccination schedule can be
accommodated under this general
approach. Also, the CARES Act permits
the Secretary to implement the
provisions of, and the amendments
made by, section 3713 by program
instruction or otherwise. As information
about vaccine products becomes
available, we anticipate that updated
information, for example information
concerning additional doses after initial
vaccination, applicability of specific
vaccine products to subsets of our
beneficiary population, or updates about
billing would be disseminated primarily
by program instruction.
As part of this IFC, we are updating
the following regulations:
• At § 410.57, Pneumococcal vaccine
and flu vaccine, we are amending the
section heading and adding a new
paragraph to reference COVID–19
vaccine.
• At § 410.152, Amounts of payment,
we are amending § 410.152(l)(1) to
include the COVID–19 vaccine in the
list of vaccines for which Medicare Part
B pays 100 percent of the Medicare
payment amount.
• At § 410.160, Part B annual
deductible, we are amending
§ 410.160(b)(2) to include the COVID–19
vaccine in the list of vaccines that are
not subject to the Part B annual
deductible and do not count toward
meeting that deductible.
• At § 411.15, Particular services
excluded from coverage, we are
amending § 411.15(e) to add an
exception for COVID–19 vaccinations to
the general exclusion of coverage for
immunizations.
• At § 414.701, Purpose, we are
amending the list of statutorily covered
drugs to include the COVID–19 vaccine.
• At § 414.707, Basis of Payment, we
are amending § 414.707(a)(2)(iii) to
include the COVID–19 vaccine in the
list of vaccines with a payment limit
calculated using 95 percent of the
average wholesale price.
• At § 414.900, Basis and scope, we
are amending § 414.900(b)(3) to include
the COVID–19 vaccine in the list of
statutorily covered drugs.
• At § 414.904, Average sales price as
the basis for payment, we are amending
§ 414.904(e)(1) to include the COVID–19
vaccine in the list of vaccines with
payment limits calculated using 95
percent of the average wholesale price.
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5. Medicare Advantage and Cost Plans
Under sections 1852(a)(1) and
1876(c)(2) of the Act, Medicare
Advantage (MA) plans and cost plan
organizations must cover all benefits
covered under Part A and Part B of
Original Medicare, subject to limited
exclusions. Therefore, all MA plans and
cost plans must cover a COVID–19
vaccine and its administration described
in section 1861(s)(10)(A) of the Act. As
described previously, the interpretation
of section 3713 of the CARES Act
adopted in this rule will result in Part
B coverage of a COVID–19 vaccine for
which FDA issues an EUA during the
PHE, and administration of that vaccine
when furnished consistent with terms of
such EUA. As amended by section 3713
of the CARES Act, section
1852(a)(1)(B)(iv)(VI) of the Act prohibits
MA plans from using cost sharing that
exceeds the cost sharing imposed under
original Medicare for a COVID–19
vaccine and its administration when
MA coverage is provided because they
are covered under Part B under section
1861(s)(10)(A) of the Act.
Section 1852(a)(5) of the Act and 42
CFR 422.109 provide that when a
National Coverage Determination (NCD)
or legislative change in benefits, such as
the addition of Part B coverage of a
COVID–19 vaccine and its
administration, results in significant
costs that have not been included in the
capitation payments made to MA plans,
coverage of the new benefit will be
provided through the Medicare FFS
program until the capitation payments
take the new significant costs into
account. The payment rates for MA
organizations for contract years 2020
and 2021 have been set without
including the costs for a COVID–19
vaccine and its administration.
Therefore, if coverage of a COVID–19
vaccine and its administration during
that period results in significant costs,
section 1852(a)(5) of the Act and
§ 422.109 will apply to require Medicare
FFS coverage of the vaccine and its
administration.
The cost projection used for the
determination whether the legislative
change results in significant costs is
based on an analysis by the Chief
Actuary of CMS of the actuarial costs
associated with a NCD or the legislative
change in benefits and compared to the
thresholds specified in the regulation at
§ 422.109. This analysis is generally
performed once a Medicare FFS
payment rate is determined for the
service. If the estimated cost of an NCD
or legislative change represents at least
0.1 percent of the national average per
capita costs or the average cost of
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furnishing a single service exceeds the
cost threshold established in using the
formula in § 422.109(a), it is considered
a significant cost and the FFS Medicare
program provides coverage for the
service until the costs are factored into
Medicare Advantage payments.
Therefore, this legislative change would
be subject to an analysis whether the
new benefit results in significant costs.
The significant cost threshold will be
met assuming that the projected cost
per-beneficiary-per-year is greater than
approximately $13, which is 0.1 percent
of the national average per capita costs.
If the threshold is reached, Medicare
beneficiaries enrolled in MA plans will
receive coverage of the COVID–19
vaccine and its administration through
the Medicare FFS program and would
be able to access the COVID–19 vaccine,
without cost sharing, at any FFS
provider or supplier that participates in
Medicare and is eligible to bill under
Part B for vaccine administration,
including those enrolled in Medicare as
a mass immunizer or a physician, nonphysician practitioner, hospital, clinic,
or group practice.
Section 3713 of the CARES Act added
Medicare Part B coverage for a COVID–
19 vaccine and its administration and
provides that MA plans must cover the
new benefit without cost sharing. While
section 1876(c)(2) of the Act ensures
that enrollees in Medicare cost plans
will have coverage of a COVID–19
vaccine and its administration, section
3713 of the CARES Act did not amend
section 1876 of the Act to provide
similar cost-sharing protections for
enrollees in cost plans who receive the
vaccine from an in-network provider.
Nor is there a provision affirmatively
relieving cost plans of the obligation to
cover the new Part B benefit. Because
the Medicare FFS program covers Part A
and Part B items and services furnished
to cost plan enrollees by out-of-network
health care providers that participate in
the Medicare FFS program, cost plan
enrollees will receive the COVID–19
vaccine and its administration without
cost sharing when they go to a health
care provider that is out of the cost
plan’s network. See 42 CFR
417.436(a)(5) and 417.448. However,
there is no requirement for cost plans to
cover the COVID–19 vaccine and its
administration without cost sharing
(that is, with cost sharing that is the
same as original Medicare) when the
vaccine is furnished by an in-network
health care provider. Many enrollees
may seek the COVID–19 vaccine from
the health care provider they usually see
or from whom they receive most of their
health care; that provider is likely to be
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in-network with the cost plan. CMS
believes that it is necessary and
appropriate to ensure that cost plan
enrollees, like other Medicare
beneficiaries, are provided access to the
COVID–19 vaccine and its
administration without cost sharing.
Section 1876(i)(3)(D) of the Act
authorizes us to impose ‘‘other terms
and conditions not inconsistent with
[section 1876]’’ that are deemed
‘‘necessary and appropriate.’’ Requiring
cost plans to comply with the same cost
sharing protections available to
Medicare beneficiaries in the FFS
program and enrolled in Medicare
Advantage plans is necessary and
appropriate, so that cost is not a barrier
for beneficiaries to get the vaccine,
particularly during the public health
emergency when ensuring access is of
paramount importance. To ensure that
cost plan enrollees also do not pay cost
sharing for the COVID–19 vaccine and
its administration when received from
an in-network provider at least until the
end of the public health emergency for
COVID–19, we are adding a new
paragraph (e)(4) to § 417.454 to require
section 1876 cost plans to cover without
cost sharing the COVID–19 vaccine and
its administration described in section
1861(s)(10)(A) of the Act without cost
sharing for the duration of the PHE for
the COVID–19 pandemic, specifically
the end of the emergency period defined
in paragraph (1)(B) of section 1135(g) of
the Act, which is the PHE declared by
the Secretary on January 31, 2020 and
any renewals thereof.
B. COVID–19 Vaccine Coverage for
Medicaid, CHIP, and BHP Beneficiaries
Under section 6008 of the FFCRA,
states’ and territories’ Medicaid
programs may receive a temporary 6.2
percentage point increase in the Federal
Medical Assistance Percentage (FMAP).
Under section 6008(b)(4) of the FFCRA,
to receive that increase, a state or
territory must cover COVID–19 testing
services and treatments, including
vaccines and the administration of such
vaccines, for Medicaid enrollees
without cost sharing. That coverage is
required during any quarter for which
the state or territory claims the
temporary FMAP increase under FFCRA
section 6008, and the FMAP increase is
available through the end of the quarter
in which the PHE for COVID–19 ends.
CMS is not aware of any states or
territories not currently claiming this
temporary FMAP increase, or of any
state or territory that intends to cease
claiming it. Accordingly, Medicaid
coverage of a COVID–19 vaccine and its
administration, without cost-sharing, is
expected to be available for most
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Medicaid beneficiaries through the end
of the quarter in which the PHE for
COVID–19 ends. For the remainder of
this section of preamble, references to
‘‘state’’ or ‘‘states’’ in discussions of
Medicaid policy also include the
territories.
To meet the requirement in FFCRA
section 6008(b)(4) to cover a COVID–19
vaccine and its administration without
cost sharing, states must compensate
Medicaid providers with a vaccine
administration fee or reimbursement for
a provider visit during which a vaccine
dose is administered, even if the vaccine
dose is furnished to the provider at no
cost.
There are some very limited
circumstances in which the FFCRA
section 6008(b)(4) coverage
requirements would not apply. CMS has
not interpreted section 6008(b)(4) of the
FFCRA to require that state Medicaid
programs cover the services described in
that provision for individuals whose
Medicaid eligibility is limited by statute
to only a narrow range of benefits that
would not otherwise include these
services. FFCRA section 6008(b)(4) did
not amend the varying benefits packages
that are required for different Medicaid
eligibility groups under section
1902(a)(10) of the Act. In some cases,
beneficiaries’ coverage is limited by
statute to a very narrow range of benefits
and services that typically would not
include services described in FFCRA
section 6008(b)(4), such as COVID–19
vaccines or their administration (see,
e.g., the limitations described in the
matter following section 1902(a)(10)(G)
of the Act for some Medicaid eligibility
groups). Nor did FFCRA section
6008(b)(4) direct states to amend
existing demonstration projects under
section 1115(a) of the Act, through
which states may offer eligibility to
groups not otherwise eligible under title
XIX of the Act, and can opt to provide
these groups with limited benefits.
Moreover, after FFCRA was enacted, in
section 3716 of the CARES Act (Pub. L.
116–136), Congress defined eligibility
for the COVID–19 testing-only optional
Medicaid eligibility group described in
section 1902(a)(10)(A)(ii)(XXIII) of the
Act in a manner that recognized that
certain limited-benefit Medicaid
eligibility groups are ‘‘uninsured,’’ and
therefore eligible to receive coverage for
COVID–19 testing under that provision,
without referring to or acknowledging
the FFCRA section 6008(b)(4) COVID–
19 testing coverage requirement. See
section 1902(ss) of the Act. Accordingly,
CMS does not interpret FFCRA section
6008(b)(4) to require states to provide
COVID–19 testing and treatment
services without cost-sharing, including
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vaccines and their administration, to
eligibility groups whose coverage is
limited by statute or under an existing
section 1115 demonstration to a narrow
range of benefits that would not
ordinarily include this coverage, such as
groups that receive Medicaid coverage
only for COVID–19 testing, family
planning services and supplies, or
tuberculosis-related services. The
COVID–19 Claims Reimbursement to
Health Care Providers and Facilities for
Testing and Treatment of the Uninsured
Program (COVID–19 Claims
Reimbursement program) administered
by the Health Resources and Services
Administration (HRSA) is available for
reimbursement of a COVID–19 vaccine
and vaccine administration costs for
individuals who would not receive
Medicaid coverage for a COVID–19
vaccine or its administration because
their Medicaid coverage is for limited
benefit packages only.
After the requirements in section
6008(b)(4) of FFCRA are no longer in
effect in a state, the state must cover
COVID–19 vaccines recommended by
the ACIP, and their administration, for
several populations under existing
statutory and regulatory authority. All
Medicaid-enrolled children under the
age of 21 eligible for the Early and
Periodic Screening, Diagnostic and
Treatment (EPSDT) benefit must receive
ACIP-recommended vaccines pursuant
to section 1905(r)(1)(A)(i) and (B)(iii) of
the Act.12 Coverage of ACIPrecommended vaccines without costsharing is required for any adult
populations who receive coverage
through Alternative Benefit Plans
(ABPs), including the adult expansion
population described at section
1902(a)(10)(A)(i)(VIII) of the Act,
pursuant to section 1937(b)(5) of the
Act, 42 CFR 440.347(a), and 45 CFR
156.115(a)(4) and 147.130. Some states
may also elect to receive a 1 percentage
point FMAP increase for their
expenditures on certain services, in
return for covering ACIP-recommended
vaccines and their administration
without cost-sharing for adults under
section 1905(a)(13) of the Act, pursuant
to section 4106 of PPACA (as codified
in section 1905(b) of the Act). Children
through age 18 who are eligible for
Medicaid (funded through both titles
XIX and XXI), as well as children who
are uninsured, who are not insured with
respect to the vaccine and who are
administered pediatric vaccines by a
12 Medicaid enrolled children up to the age of 18
are generally exempt from cost sharing. For
children age 19 or 20 cost sharing for an ACIPrecommended vaccine may apply, outside of an
Alternative Benefit Plan.
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71149
federally qualified health center (FQHC)
or rural health clinic, or who are Indians
(as defined in section 4 of the Indian
Health Care Improvement Act) receive
ACIP-recommended vaccinations
through the Vaccines for Children (VFC)
program, described at section 1928 of
the Act. The Centers for Disease Control
and Prevention (CDC) will determine if
COVID–19 vaccines will be included in
the VFC program. Coverage of the
administration of a VFC-covered
vaccine for Medicaid-eligible children
would be provided by the state
Medicaid program.
After the FFCRA section 6008(b)(4)
requirements are no longer in effect in
a state, the state also has the option to
cover a COVID–19 vaccine and its
administration for other eligibility
groups. Such groups include the parent/
caretaker relative eligibility group at 42
CFR 435.110, eligibility groups for
individuals who are age 65 or older or
who are eligible on the basis of
blindness or a disability, and pregnant
women enrolled under 42 CFR 435.116
who are eligible for full state plan
benefits. If a state elects to cover a
COVID–19 vaccine and its
administration for any one of these
groups, it must do so for all of them,
except that with respect to the pregnant
women group described in 42 CFR
435.116, per 42 CFR 440.250(p) states
can cover a vaccine and its
administration as a pregnancy-related
service while not providing the same
coverage for the other eligibility groups.
Outside of the period in which FFCRA
section 6008(b)(4) applies to a state, the
state has the option to apply cost
sharing to coverage of a COVID–19
vaccine or its administration unless the
beneficiary is in an eligibility group that
is exempt from cost-sharing under
section 1916 or section 1916A of the Act
and regulations at 42 CFR 447.56 (for
example, most children under age 18,
most pregnant women, most children in
foster care, individuals receiving
services in an institution that already
had their medical assistance reduced by
their income, individuals receiving
hospice care, and Indians who are
currently receiving or have ever
received an item or service furnished by
an Indian health care provider or
through referral under contract health
services).
After the FFCRA section 6008(b)(4)
requirements are no longer in effect in
a state, a COVID–19 vaccine and its
administration could also be a covered
service for many Medicaid eligibility
groups when furnished by a
participating provider under certain
Medicaid benefits that are mandatory
for many Medicaid eligibility groups,
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depending on how the state has defined
the amount, duration, and scope
parameters of the benefit. Because
inpatient and outpatient hospital
services, physician services, and
Federally Qualified Health Center and
Rural Health Clinic services are
mandatory Medicaid benefits for the
categorically needy populations,
COVID–19 vaccine administration could
be a covered service for many Medicaid
beneficiaries when provided by these
participating providers, at state option.
States might also cover COVID–19
vaccine administration for beneficiaries
under various optional state plan
benefits, such as the ‘‘other licensed
practitioner’’ benefit described in
section 1905(a)(6) of the Act and 42 CFR
440.60, or the ‘‘preventive services’’
benefit described in section 1905(a)(13)
of the Act and 42 CFR 440.130(c).
However, states would generally not
have the option to cover a COVID–19
vaccine or its administration for any
group whose coverage is limited by
statute or under a current section 1115
demonstration to a narrow range of
benefits that would not ordinarily
include vaccine coverage. As described
above, the COVID–19 Claims
Reimbursement program administered
by HRSA may be used to cover COVID–
19 treatment, including the
administration of vaccines, for such
limited-benefit beneficiaries. In
addition, a state might have the option,
subject to Federal approval, to propose
or amend a section 1115 demonstration
to include this coverage for a group that
would not otherwise be entitled to
receive it under the statute or under
current section 1115 authority.
The FFCRA section 6008(b)(4)
requirement does not apply to separate
CHIPs.13 In separate CHIPs, states must
cover ACIP-recommended vaccines and
their administration for all children
under age 19 with no cost sharing. See
section 2103(c)(1)(D) and (e)(2) of the
Act, and 42 CFR 457.410(b)(2) and
457.520(b)(4). Coverage of uninsured
pregnant women in a separate CHIP is
optional. Currently, the states that cover
pregnant women in a separate CHIP
include all ACIP-recommended
vaccines with no cost sharing in this
coverage. However, current CMS
interpretation is that this vaccine
coverage is not required.
The FFCRA section 6008(b)(4)
requirement also does not apply to the
Basic Health Program (BHP). Minnesota
and New York are the only states that
13 In states that use title XXI funding to expand
Medicaid eligibility for children, the FFCRA section
6008(b)(4) requirements apply to these title XXI
funded Medicaid beneficiaries in the same way that
they do to all other Medicaid beneficiaries.
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currently operate a BHP. BHP coverage
must include benefits in at least the ten
essential health benefits described in
section 1302(b) of the PPACA and must
comply with the Exchange’s costsharing protections,14 which includes
providing all ACIP recommended
vaccines without cost sharing. See
sections 1331(a)(1), (a)(2)(B) and (b)(2)
of PPACA, and 42 CFR 600.405(a) and
600.510(b).
Section 600.510(b) cross-references 45
CFR 147.130, which establishes
requirements related to the coverage of
preventive health services for BHP. For
ABPs, 42 CFR 440.347 cross-references
45 CFR part 156, which incorporates 45
CFR 147.130, which establishes
requirements related to the coverage of
preventive health services. Consistent
with the changes to 45 CFR 147.130
made through this rulemaking, during
the COVID–19 public health emergency
BHP plans and Medicaid ABPs must
provide coverage for and must not
impose any cost-sharing for ‘‘qualifying
coronavirus preventive services,’’
including a COVID vaccine, regardless
of whether the vaccine is delivered by
an in-network or out-of-network
provider. For details on the coverage
requirements for ‘‘qualifying
coronavirus preventive services’’ and
the updates to 45 CFR 147.130 see
section III of this IFC.
Lastly, we note that CMS intends this
section only to be a description of
current policy and existing law, with
the exception noted directly above for
BHP and Medicaid ABPs, and that CMS
is not making any changes to its current
policy or regulatory requirements in this
rule.
C. Price Transparency for COVID–19
Diagnostic Tests
1. Introduction
Robust COVID–19 diagnostic testing
is fundamental to the Federal
Government’s strategy for controlling
the spread of COVID–19.15 In
recognition of the importance of
COVID–19 diagnostic testing, the
Federal Government has taken several
14 As explained in rulemaking, this includes the
prohibition on cost sharing for preventive health
services. See the Basic Health Program: State
Administration of Basic Health Programs; Eligibility
and Enrollment in Standard Health Plans; Essential
Health Benefits in Standard Health Plans;
Performance Standards for Basic Health Programs;
Premium and Cost Sharing for Basic Health
Programs; Federal Funding Process; Trust Fund and
Financial Integrity; Final Rule. 79 FR 14111 at
14128 (March 12, 2014).
15 The White House, CDC and FDA document:
Testing Overview, Opening Up America Again.
Available at: https://www.whitehouse.gov/wpcontent/uploads/2020/04/Testing-OverviewFinal.pdf.
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steps to reduce financial barriers to
testing for both insured and uninsured
individuals, including the following:
• The FFCRA was enacted on March
18, 2020. Section 6001 of the FFCRA
generally requires group health plans
and health insurance issuers offering
group or individual health insurance
coverage to provide coverage for certain
items and services, including in vitro
diagnostic testing products for the
detection of SARS–CoV–2, the virus that
causes COVID–19, or the diagnosis of
COVID–19 (referred to herein
collectively as COVID–19 diagnostic
tests) when those items or services are
furnished on or after March 18, 2020,
and during the PHE for COVID–19.
Plans and issuers must provide this
coverage without imposing any costsharing requirements (including
deductibles, copayments, and
coinsurance) or prior authorization or
other medical management
requirements. Related items and
services include those provided during
urgent care center visits, in-person and
telehealth office visits, and emergency
room visits that result in an order for or
administration of an in vitro diagnostic
product, to the extent that such items
and services relate to the furnishing or
administration of a COVID–19
diagnostic test, or to the evaluation of an
individual for purposes of determining
the need of the individual for a COVID–
19 diagnostic test. Section 3201 of the
CARES Act, enacted on March 27, 2020,
amended section 6001 of the FFCRA to
include a broader range of diagnostic
tests that plans and issuers must cover
without any cost-sharing requirements
or prior authorization or other medical
management requirements.
• The COVID–19 Claims
Reimbursement to Health Care
Providers and Facilities for Testing and
Treatment of the Uninsured Program
provides reimbursements on a rolling
basis directly to eligible providers for
claims that are attributed to the testing
and treatment of COVID–19 for certain
uninsured individuals. The program is
funded via (1) the FFCRA Relief Fund,
which includes funds received from the
Public Health and Social Services
Emergency Fund, as appropriated in the
FFCRA and the Paycheck Protection
Program and Health Care Enhancement
Act (PPPHCEA) (Pub. L. 116–139),
which each appropriated funding to
reimburse providers for conducting
COVID–19 testing for the uninsured,
and (2) the Provider Relief Fund, as
appropriated in the CARES Act and the
PPPHCEA.16
16 FAQs for COVID–19 Claims Reimbursement to
Health Care Providers and Facilities for Testing and
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• HHS has partnered with
pharmacies, retail companies, and
health centers nationwide to make nocost COVID–19 diagnostic testing
available to Americans in communities
across the country.17
Congress has also taken steps to
facilitate the reimbursement for COVID–
19 diagnostic testing and to ensure that
pricing for performance of such testing
is publicly available. Specifically,
section 3202(a) of the CARES Act
requires group health plans and issuers
providing coverage for items and
services described in section 6001(a) of
the FFCRA to reimburse any provider of
a COVID–19 diagnostic test an amount
that equals the negotiated rate, or, if the
plan or issuer does not have a
negotiated rate with the provider, the
cash price for such service that is listed
by the provider on a public website. The
plan or issuer may also negotiate a rate
with the provider that is lower than the
cash price. More information related to
health insurance issuer and group
health plan coverage and
reimbursement for COVID–19 diagnostic
testing is available at https://
www.cms.gov/files/document/FFCRAPart-42-FAQs.pdf and https://
www.cms.gov/files/document/FFCRAPart-43-FAQs.pdf. Specifically, the
Departments note that the
reimbursement requirements under
CARES Act 3202(a) will apply to
COVID–19 diagnostic testing, as defined
in this IFC.
Section 3202(b) of the CARES Act
establishes a requirement for each
provider of a diagnostic test for COVID–
19 to publicize cash prices for such
COVID–19 diagnostic testing.
Specifically, section 3202(b)(1) of the
CARES Act requires each provider of a
diagnostic test for COVID–19 to make
public the cash price for such test on a
public internet website of such provider
during the emergency period declared
under section 319 of the PHS Act.
Section 3202(b)(2) of the CARES Act
authorizes the Secretary to impose a
civil monetary penalty (CMP) on any
provider of a diagnostic test for COVID–
19 that does not make public its cash
price for such test in compliance with
section 3202(b)(1) of the CARES Act and
that has not completed a corrective
action plan (CAP) to comply with that
section. The statute states that the
amount of the CMP must not exceed
Treatment of the Uninsured. Available at https://
www.hrsa.gov/coviduninsuredclaim/frequentlyasked-questions.
17 Information on Community-Based Testing Sites
for COVID–19 can be found at https://www.hhs.gov/
coronavirus/community-based-testing-sites/
index.html.
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$300 per day that the violation is
ongoing.
We believe that cash price posting by
providers of diagnostic tests for COVID–
19 is important for not only for plans
and issuers that must comply under
section 3202(a) of the CARES Act but
also for individuals who seek COVID–19
diagnostic testing.
Therefore, we are adopting in this IFC
policies that implement the requirement
in section 3202(b) of the CARES Act that
providers of diagnostic tests for COVID–
19 make public their cash price for such
tests on the internet. Specifically, we are
finalizing the following: (1) Definitions
of ‘‘provider of a diagnostic test for
COVID–19’’ (herein referred to as
‘‘provider’’), ‘‘diagnostic test for
COVID–19’’ (herein referred to as
‘‘COVID–19 diagnostic test’’), and ‘‘cash
price’’; (2) requirements for making
public cash prices; and (3) penalties for
non-compliance with the cash price
posting requirements.
2. Requirement That Providers of
COVID–19 Diagnostic Tests Make Public
Cash Prices for COVID–19 Diagnostic
Tests
The rapid expansion of COVID–19
related diagnostic testing capacity is a
top priority in HHS’ strategy to combat
the pandemic. COVID–19 diagnostic
testing is generally performed by
laboratories located in a variety of sites,
including for example: Government
labs; hospital-run labs; clinician offices;
stand-alone labs; urgent care centers;
and pharmacies. There are several types
of COVID–19 tests designed to detect
SARS–CoV–2 or to diagnose a possible
case of COVID–19, including molecular
(RT–PCR) tests, which are used to detect
the virus’s genetic material, and antigen
tests, which are used to detect specific
proteins on the surface of the virus and
serology testing, which is used to look
for the presence of antibodies produced
by the body in response to infections.
For purposes of implementing section
3202(b) of the CARES Act, we are
adopting a new 45 CFR part 182, ‘‘Price
Transparency for COVID–19 Diagnostic
Tests,’’ that will implement price
transparency requirements for making
public cash prices for performance of a
COVID–19 diagnostic test. Section
182.10 states that part 182 implements
section 3202(b) of the CARES Act.
For purposes of section 6001(a)(1) of
the FFCRA, as amended by section 3201
of the CARES Act, and as explained in
guidance issued by the Departments,
COVID–19 diagnostic tests include all in
vitro diagnostic tests, which include
molecular, antigen, and serological tests.
Specifically, section 6001(a) of the
FFCRA, as amended by section 3201 of
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71151
the CARES Act, requires plans and
issuers to provide coverage for an in
vitro diagnostic test, as defined in 21
CFR 809.3(a) (or its successor
regulations), for the detection of SARS–
CoV–2 or diagnosis of COVID–19, and
the administration of such a test that: (1)
Is approved, cleared, or authorized
under section 510(k), 513, 515, or 564 of
the FD&C Act (21 U.S.C. 360(k), 360c,
360e, 360bbb–3); (2) the developer has
requested, or intends to request,
emergency use authorization under
section 564 of the FD&C Act (21 U.S.C.
360bbb–3), unless and until the
emergency use authorization request
under such section 564 has been denied
or the developer of such test does not
submit a request under such section
within a reasonable timeframe; (3) is
developed in and authorized by a state
that has notified the Secretary of HHS
of its intention to review tests intended
to diagnose COVID–19; or (4) other tests
that the Secretary of HHS determines
appropriate in guidance.18 We are
therefore at § 182.20 defining a
‘‘diagnostic test for COVID–19’’ (also
referred to as a ‘‘COVID–19 diagnostic
test’’) as a COVID–19 in vitro diagnostic
test described in section 6001 of the
FFCRA, as amended by section 3201 of
the CARES Act. Such COVID–19
diagnostic tests are currently billed by
providers using HCPCS and CPT codes
including, but not limited to: CPT codes
86408, 86409, 87635, 87426, 86328, and
86769 and HCPCS codes U0001 through
U0004. We intend this list of billing
codes to be illustrative, however, not
exhaustive. Therefore, as noted
previously, a ‘‘COVID–19 diagnostic
test’’ is defined as a COVID–19 in vitro
diagnostic test described in section 6001
of the FFCRA, as amended by section
3201 of the CARES Act, even if a
particular COVID–19 diagnostic test or
its billing code is not included on this
list. Codes continue to be created to
address new and proprietary tests as
they are developed. We therefore
anticipate updating this list in guidance
as new tests and codes are developed.
Obtaining a diagnostic test for
COVID–19 generally can involve up to
three separate health care services for an
individual including evaluation by a
practitioner of the need for such testing,
and, once the provider determines the
need for a COVID–19 diagnostic test,
specimen collection and laboratory
analysis of the specimen, that is, actual
performance of a COVID–19 diagnostic
18 See Q3 of FAQs About Families First
Coronavirus Response Act and Coronavirus Aid,
Relief, And Economic Security Act Implementation
Part 42 available at: https://www.cms.gov/files/
document/FFCRA-Part-42-FAQs.pdf.
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test. For purposes of implementing
section 3202(b), we are defining
‘‘provider of a diagnostic test for
COVID–19’’ (herein referred to as
‘‘provider’’) as any facility that performs
one or more COVID–19 diagnostic tests.
CMS regulates all laboratory testing
performed on humans for the purposes
of diagnosis, prevention, or treatment in
the U.S. through the Clinical Laboratory
Improvement Amendments CLIA
program (42 U.S.C. 263a). In order to
perform COVID–19 testing, a facility
(whether that be a primary care
provider’s office, urgent care center,
outpatient hospital site or stand-alone
laboratory) is required to hold a CLIA
certificate based on the complexity of
the testing performed by the facility.
Therefore, we expect that any ‘‘provider
of a diagnostic test for COVID–19’’
would either hold or have submitted a
CLIA application necessary to obtain a
CLIA certificate (including a certificate
of waiver, as applicable) and that such
testing would occur in facilities ranging
from primary care provider offices to
urgent care centers to stand-alone
national laboratories.
At § 182.20, we are defining ‘‘cash
price’’ as the charge that applies to an
individual who pays in cash (or cash
equivalent) for a COVID–19 diagnostic
test. We believe this definition will
provide a clear point of reference not
only for individuals who seek such
tests, but also for payers who wish to
negotiate reimbursement rates with
providers of diagnostic tests for COVID–
19, or who wish to help direct their
members to providers of diagnostic tests
for COVID–19 who charge cash prices
that payers believe to be reasonable. The
‘‘cash price’’ is generally analogous to
the ‘‘discounted cash price’’ as defined
at 45 CFR 180.20 for purposes of the
Hospital Price Transparency final rule.
As we explained in that rule, providers
often offer discounts off their gross
charges or make other concessions to
individuals who pay for their own care
(referred to as self-pay individuals) (84
FR 65524). We also stated that the
discounted cash price may be generally
analogous to the ‘‘walk-in’’ rate that
would apply to all self-pay individuals,
regardless of insurance status, who pay
in cash at the time of the service, and
that such charges are often lower than
the rate the hospital negotiates with
third party payers because billing selfpay individuals would not require many
of the administrative functions that exist
for hospitals to seek payment from third
party payers (for example, prior
authorization and billing
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functions).19 20 21 22 It is therefore our
expectation that the ‘‘cash price’’
established by the provider will be
generally similar to, or lower than, rates
negotiated with in-network plans and
insurers. If a provider has not
established a ‘‘cash price’’ for a COVID–
19 diagnostic test that is lower than its
gross charge or retail rate, the provider
must make public the undiscounted
gross or retail rate found in its master
price list (which is analogous to the
hospital’s chargemaster). We do not
believe that posting a ‘‘cash price’’
should prevent a provider of a
diagnostic test for COVID–19 from
offering testing for free to individuals as
charity care or in an effort to combat the
public health crisis, rather, the ‘‘cash
price’’ would be the maximum charge
that may apply to a self-pay individual
paying out-of-pocket. We solicit
comment on this approach and whether
any additional standards should be
implemented to address any potential
abuse.
Under new § 182.30(a) and (b), these
requirements apply to a ‘‘provider of a
diagnostic test for COVID–19’’ as
defined at § 182.20 and are applicable
during the PHE for COVID–19
determined to exist nationwide as of
January 27, 2020, by the HHS Secretary
under section 319 of the PHS on January
31, 2020, as a result of confirmed cases
of COVID–19, including any subsequent
renewals.
Finally, section 3202(b)(1) of the
CARES Act states that each provider of
a diagnostic test for COVID–19 shall
make public the cash price for such test
on a public internet website of such
provider. We interpret this to mean that
providers must make public the cash
prices for performing COVID–19
diagnostic tests on the provider’s
internet website. Specifically, as
discussed below, § 182.40(a)(1) and (2)
require that each provider of a COVID–
19 diagnostic test that has a website
19 Rosato D. How Paying Your Doctor in Cash
Could Save You Money. Consumer Reports. May 4,
2018. Available at: https://www.consumerreports.
org/healthcare-costs/how-paying-your-doctor-incash-could-save-you-money/.
20 David Lazarus. Insured price: $2,758. Cash
price: $521. Could our Healthcare System by any
Dumber? Los Angeles Times. July 30, 2019.
Available at: https://www.latimes.com/business/
story/2019-07-29/column-could-our-healthcaresystem-be-any-dumber.
21 Beck M. How to Cut Your Health-Care Bill: Pay
Cash. The Wall Street Journal. February 15, 2016.
Available at: https://www.wsj.com/articles/how-tocut-your-health-care-bill-pay-cash-1455592277.
22 Dr. Steven Goldstein. Patients Can Save Money
When They Pay Their Doctor In Cash. Houston
Healthcare Initiative. August 10, 2020. Available at:
https://houstonhealthcareinitiative.org/patientscan-save-money-when-they-pay-their-doctor-incash/.
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make public the cash price information
described in § 182.40(c) electronically,
and that the information itself, or a link
to a web page that contains such
information, must appear in a
conspicuous location on a searchable
homepage on the provider’s website. We
recognize that some providers of a
COVID–19 diagnostic test, for example,
small or rural providers, may not have
websites. Therefore, in the event that a
provider does not have a website on
which to post this cash price
information, we are finalizing a policy
at § 182.40(b) to require the provider to
make public its cash price information
in writing upon request within two
business days and by posting signage
prominently at the location where the
provider offers a COVID–19 diagnostic
test in a place likely to be viewed by
members of the public seeking to obtain
and pay for such testing. If the provider
does not have its own website or a
publicly accessible location then, upon
request and within two business days,
the provider will be required to make
public its cash price information in
writing to the requestor but will not be
required to post signage at the location
where it performs the COVID–19
diagnostic test. For purposes of
complying with the requirement that the
cash price information be made public
in writing, we will consider email
correspondence to the requester to be an
acceptable written format. We believe
these policies will help ensure that the
public (including individuals, issuers,
health plans, and others) has access to
every provider’s COVID–19 diagnostic
test cash prices, including those
providers who do not perform COVID–
19 diagnostic tests at publicly accessible
locations. We seek comment on these
issues, including the frequency by
which providers may not have websites.
Furthermore, at § 182.40(a)(3), we are
requiring that providers of a COVID–19
diagnostic test display their cash price
information in an easily accessible
manner, without barriers, including, but
not limited to, ensuring the information
is accessible: Free of charge; without
having to establish a user account or
password; and without having to submit
personal identifiable information (PII).
In addition, we are requiring at
§ 182.40(a)(4) that the provider’s
homepage contain certain keywords that
we believe will increase the likelihood
that the public will be able to locate the
information using a search engine.
Specifically, § 182.40(a)(4) requires that
all of the following terms be included
on the provider’s homepage: The
provider’s name; ‘‘price’’; ‘‘cost’’; ‘‘test’’;
‘‘COVID’’; and ‘‘coronavirus.’’ We seek
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comment on whether providers should
have flexibility to select between using
‘‘COVID’’ or ‘‘coronavirus’’ and between
‘‘cost’’ and ‘‘price’’ if the provider is
linking to the information from its
homepage.
Finally, we believe that it is important
for the provider to include certain
standardized information so that the
public can understand the relationship
between the posted cash price and the
COVID–19 diagnostic test(s) offered by
the provider. Therefore, at § 182.40(c)(1)
through (4), we are requiring all
providers to make public, along with the
cash price for each COVID–19
diagnostic test(s) that they offer,
information that, at minimum, includes
a plain language description of each
COVID–19 diagnostic test, the
corresponding cash price, the billing
code(s) for each such test(s), and any
additional information as may be
necessary for the public to be certain of
the cash price for a particular COVID–
19 diagnostic test. For example, if the
provider offers the same test at a
different cash price that is dependent on
location or some other factor, then on its
website listing of cash prices, the
provider must indicate all the cash
prices that apply to the test and relevant
distinguishing information as to when
each different cash price applies. We
believe that this information is
necessary for the public, including
group health plans and health insurance
issuers offering group or individual
health insurance coverage that must
provide reimbursement for COVID–19
diagnostic testing pursuant to the
requirements of section 3202(a) of the
CARES Act. This requirement applies to
cash price information posted on the
provider’s website, made available upon
request and, where applicable, on
signage.
These requirements are applicable
immediately; however, we seek
comment on these requirements and
may, as a result of public comment,
revise these requirements or finalize
additional requirements. We also
specifically seek comment on the
definition of ‘‘diagnostic test for
COVID–19’’ as solely a COVID–19 in
vitro diagnostic test described in section
6001 of FFCRA.
We seek comment on the definition of
‘‘provider of a COVID–19 diagnostic
test’’. We seek comment on whether
consumers may benefit from knowing
the total cost of care for receiving a
COVID–19 test, including the doctor’s
visit and specimen collection, in order
to protect themselves against potential
unexpected health care costs and make
a more informed health care purchasing
decision and therefore whether we
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should adopt a more inclusive
definition of a provider of a diagnostic
test for purposes of this requirement.
Specifically, we seek comment on
whether a ‘‘provider of a diagnostic test
for COVID–19’’ should be expanded to
include providers that perform
additional services related to the
performance of a COVID–19 diagnostic
test, such as for specimen collection or
mileage fees that may be billed as part
of or in conjunction with the specimen
collection, if applicable. We are
particularly interested in submissions
from stakeholders that include data,
both anecdotal and claims-based, on the
ways in which consumers request and
receive COVID–19 diagnostic testing,
including the site of care, frequency,
and type of provider.
We seek comment on the definition of
‘‘cash price’’. We have heard concerns
from stakeholders that certain providers
may use the posting of a ‘‘cash price’’
as an opportunity to ‘‘price
gouge’’.23 24 25 We therefore specifically
seek comment on whether this
definition or some other definition
would help to mitigate concerns for
price gouging by out-of-network
providers. We seek comment on
whether there are additional authorities
and safeguards that could be used to
mitigate concerns for price gouging both
for group health plans and issuers and
for consumers receiving a COVID–19
diagnostic test.
We seek comment regarding whether
these requirements are sufficient to
inform consumers of the cash price for
a COVID–19 diagnostic test in advance
of receiving one and what, if any,
additional requirements or safeguards
should be considered to avoid consumer
confusion or prevent unintended
consequences (for example, balance
billing). Specifically, we seek comment
regarding how providers should post
cash prices so that they do not
inadvertently deter consumers from
seeking a test that would normally
result in no out-of-pocket cost to the
consumer.
23 Morgan Haefner. Out-of-network Providers
Price Gouging COVID–19 tests, AHIP says. Becker’s
Hospital Review Newsletter. August 28, 2020.
Available at: https://www.beckershospitalreview.
com/payer-issues/out-of-network-providers-pricegouging-covid-19-tests-ahip-says.html.
24 Susannah Luthi. The $7,000 COVID Test: Why
States are Stepping in to Shield Consumers.
POLITICO. June 8, 2020. Available at: https://
www.politico.com/news/2020/06/08/coronavirustest-costs-304058.
25 Ken Alltucker. ‘I was floored’: Coronavirus test
prices charged by some hospitals and labs stun
consumers, spur questions. USA Today. September
15, 2020. Available at: https://www.usatoday.com/
story/news/health/2020/09/15/covid-test-priceshospitals-scrutiny-congress-insurers-consumers/
3472304001/.
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Finally, we seek comment on an
approach that balances priorities to
further price transparency for
consumers and other stakeholders and
reduce barriers to COVID–19 testing. We
recognize that these final policies
become effective as of the date of
display of this IFC and are applicable
only until the end of the PHE. Even so,
we seek comment whether and to what
extent these final policies and the
alternatives about which we are seeking
comment (for instance, expansion of the
definition of ‘‘provider’’) may lead to:
• Potential cost shifting from
providers or participants, beneficiaries,
and enrollees to group health plans or
issuers, if the group health plan and
issuer reimbursement obligation for
COVID–19 diagnostic testing is
expanded to cover such testing without
cost-sharing (including deductibles, copays, and co-insurance) and as payment
in full for items and services that were
not previously covered in such a
manner by group health plans or
issuers.
• Potential for group health plans or
issuers to negotiate rates that are lower
than the cash price with out-of-network
providers with whom they do not have
established negotiated rates.
• Price gouging or other anticompetitive behavior (under both the
policies and the alternatives for which
we seek comment) by providers as well
as any potential negative impact on
premiums in the future that have not
already been accounted for in 2021
rates. Please provide empirical
evidence, if any, including based on
claims data during the PHE for COVID–
19.
• Potential savings to issuers and
plans from insured consumers seeking
out COVID–19 diagnostic testing from
in-network providers, as opposed to the
provider of their choice, as a result of
these increased price transparency
requirements.
• Price sensitivity by consumers
covered by group health plans or issuers
in their choice of provider, and
awareness of any potential cost-shifting
to group health plans or issuers, or to
consumers themselves through balance
billing, as a result of these increased
price transparency requirements.
• Transparency benefits for the
uninsured, who may already have an
incentive to find the lowest price.
• Group health plans or issuers taking
on new consumer education or other
potential costs, for example, costs
associated with incentivizing consumers
covered by group health plans or issuers
to stay in network or seek care from
lower cost providers.
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3. Monitoring and Enforcement of
Requirements To Publicize Cash Prices
for COVID–19 Diagnostic Tests
Section 3202(b)(2) of the CARES Act
authorizes and provides the Secretary
discretion to impose a CMP on any
provider of a diagnostic test for COVID–
19 that is not in compliance with
section 3202(b)(1) of the CARES Act and
has not completed a CAP to comply
with the requirements of such
paragraph, in an amount not to exceed
$300 per day that the violation is
ongoing. In this IFC, we are adopting
mechanisms to monitor the requirement
that a provider of a diagnostic test for
COVID–19 publicize the cash price for
diagnostic testing and enforce these
requirements, as necessary.
a. Monitoring for Noncompliance and
Pre-Penalty Actions
Section 3202(b)(1) of the CARES Act
does not prescribe monitoring
procedures or the factors we should
consider in imposing penalties on
providers for noncompliance. We
anticipate relying predominantly on
complaints made to CMS by the public,
including individuals, as well as issuers
and plans, regarding providers’
potential noncompliance. Specifically,
in response to such complaints, we may
investigate and evaluate whether a
provider has complied with the
requirements discussed above. The
monitoring methods for determining a
provider’s compliance with the
requirements for publicizing the cash
price for a COVID–19 diagnostic test
may include, but are not limited to, the
following, as appropriate:
• CMS’ evaluation of complaints
made to CMS.
• CMS’ review of an individual’s or
entity’s analysis of noncompliance as
stated in the complaint.
• CMS’ review of providers’ websites
or, where a provider does not have a
website, its written notice and signage.
The IFC includes these monitoring
methods in the regulations at
§ 182.50(a).
Additionally, at § 182.50(b), we are
finalizing discretion for CMS to take any
of the following actions if CMS
determines the provider is
noncompliant with the requirements of
§ 182.40:
• Provide a written warning notice to
the provider of the specific violation(s).
• Request that a provider submit and
comply with a CAP under § 182.60.
• Impose a CMP on the provider if the
provider fails to respond to CMS’
request to submit a CAP or to comply
with the requirements of a CAP
approved by CMS.
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A provider that CMS identifies as
noncompliant and to which it offers an
opportunity to take corrective action to
come into compliance may be notified
via a warning notice of its deficiencies.
In response to the warning letter, a
provider may choose, but is not
required, to submit documentation for
CMS to review to determine
compliance. CMS will review any
documentation a provider may submit
and, where applicable, a provider’s
website or other form of written notice,
to determine if the provider’s
noncompliance has been corrected. In
the event that a provider does not have
its own website on which to post the
cash price, CMS will require
documentation that the provider has the
cash price in written form timely upon
request and, where applicable, has
posted signage at the provider’s facility.
At § 182.60, we specify the
requirements for CAPs. Specifically,
§ 182.60(a) states that a provider may be
required to submit a CAP if CMS
determines a provider is noncompliant
or the provider’s noncompliance
continues after a warning notice. A
violation may include, but is not limited
to, a provider’s failure to make public its
cash price information for COVID–19
diagnostic testing required by § 182.40
and a provider’s failure to make public
its cash price information in the form
and manner required under § 180.40.
Section 182.60(b) states that CMS may
request that a provider submit and
comply with a CAP, specified in a
notice of violation issued by CMS to a
provider. Additionally, in § 182.60(c),
we specify the following provisions
related to CAPs:
• A provider required to submit a
CAP must do so, in the form and
manner, and by the deadline, specified
in the notice of violation issued by CMS
to the provider, and must comply with
the requirements of the CAP approved
by CMS.
• A provider’s CAP must specify
elements including, but not limited to,
the corrective actions or processes the
provider will take to address the
deficiency or deficiencies identified by
CMS, and the timeframe by which the
provider will complete the corrective
action.
• A CAP is subject to CMS review
and approval. After CMS’ review and
approval of a provider’s CAP, CMS may
monitor and evaluate the provider’s
compliance with the corrective actions
specified in the CAP.
Section 182.60(d) outlines the
following provisions for identifying a
provider’s noncompliance with CAP
requests and requirements:
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• A provider’s failure to respond to
CMS’ request to submit a CAP includes
failure to submit a CAP in the form,
manner, or by the deadline, specified in
a notice of violation issued by CMS to
the provider.
• A provider’s failure to comply with
the requirements of a CAP includes
failure to correct violation(s) within the
specified timeframes.
We seek comment on this approach
for monitoring providers of COVID–19
diagnostic testing for compliance with
these requirements. Specifically, we
seek comments on relying
predominantly on complaints to
determine a provider’s potential
noncompliance. We further seek
comments on issuing warning letters
and requesting CAPs for violations
related to making public cash prices for
COVID–19 diagnostic testing.
Additionally, we seek comments on the
length of time we should specify in
warning notices to allow corrections of
violations before issuance of a request
for CAP, and the length of time we
should specify for providers to complete
and return a CAP to CMS.
b. Civil Monetary Penalties
Under section 3202(b)(2) of the
CARES Act, CMS may impose a CMP on
a provider that we identify as
noncompliant. At § 182.70, we are
finalizing requirements related to
imposition of CMPs. At § 182.70(a), we
finalize a policy that CMS may impose
a CMP on a provider that we identify as
noncompliant with any of the
requirements of § 182.40, and that fails
to respond to CMS’ request to submit a
CAP or to comply with the requirements
of a CAP approved by CMS described in
§ 182.60(d).
Under the statute, the maximum daily
dollar amount for a CMP to which a
provider may be subject is $300, even if
the provider is in violation of multiple
discrete requirements of § 182.40. The
maximum daily amount of the CMP will
be adjusted annually using the
multiplier determined by the Office of
Management and Budget (OMB) for
annually adjusting CMP amounts under
45 CFR part 102. CMS will provide a
written notice of imposition of a CMP to
the provider via certified mail or
another form of traceable carrier. The
elements of this notice to the provider
will include but are not limited to the
following:
• The basis for the provider’s
noncompliance, including, but not
limited to, the following: CMS’
determination as to which
requirement(s) the provider has
violated; and the provider’s failure to
respond to CMS’ request to submit a
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CAP or comply with the requirements of
a CAP.
• CMS’ determination as to the
effective date for the violation(s).
• The amount of the penalty as of the
date of the notice.
• A statement that a CMP may
continue to be imposed for continuing
violation(s).
• Payment instructions.
• A statement of the provider’s right
to a hearing according to § 182.90 of
subpart D.
• A statement that the provider’s
failure to request a hearing within 30
calendar days of the issuance of the
notice permits the imposition of the
penalty, and any subsequent penalties
pursuant to continuing violations,
without right of appeal.
CMS may issue subsequent notice(s)
of imposition of a CMP, according to the
aforementioned requirements (in short,
where investigation reveals there is
continuing justification), that result
from the same instance(s) of
noncompliance. A provider must pay
the CMP in full within 60 calendar days
after the date of the notice of imposition
of a CMP from CMS. In the event a
provider requests a hearing, under
subpart D of 45 CFR part 182, the
provider must pay the amount in full
within 60 calendar days after the date of
a final and binding decision to uphold,
in whole or in part, the CMP. If the 60th
calendar day is a weekend or a Federal
holiday, then the timeframe is extended
until the end of the next business day.
Should a provider elect to appeal the
CMP, and where the CMP is upheld
only in part by a final and binding
decision, CMS will issue a modified
notice of imposition of a CMP, to
conform to the adjudicated finding as
specified in § 182.70.
In the event a CMP is not paid in full
within 60 days, CMS will follow the
collections activities set forth in 45 CFR
part 30. Generally, CMS will issue a
written demand for payment no later
than 30 days after a debt is delinquent.
For debts not paid by the date specified
in the written demand, interest, charged
at a rate established by the Secretary of
the Treasury, shall accrue from the date
of delinquency. CMS will transfer debts
180 days or more delinquent to the
Department of Treasury for collection.
We seek comment on the approach we
are establishing for imposing a CMP on
a provider noncompliant with the
regulations set forth in § 182.40.
Specifically, we seek comments on the
length of time allowed between issuance
of the request for CAP and the
imposition of a CMP. In addition, we
seek comments on the amount of the
CMP imposed per day up to the
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statutory maximum daily amount that
would be applicable to all noncompliant
providers.
c. Appeals Process
We believe it is important to establish
a fair administrative process by which
providers may appeal CMS’ decisions to
impose penalties under the
requirements established by § 182.40.
Through various programs, we have
gained experience with administrative
hearings and other processes to review
CMS’ determinations. That experience
includes the processes we recently
finalized in the CY 2020 Hospital
Outpatient Prospective Payment System
(OPPS) Price Transparency Final Rule
(84 FR 65524) and corresponding
regulations at 45 CFR part 180, which
requires price transparency for
hospitals, and we are aligning the
procedures for the appeals process here
with those procedures. Therefore, a
provider upon which CMS has imposed
a penalty under § 182.70 may appeal
that penalty in accordance with
§§ 180.100 and 180.110, subpart D, with
conforming edits.
Generally, under this approach, a
provider upon which CMS has imposed
a penalty may request a hearing of that
penalty before an Administrative Law
Judge (ALJ). The CMS Administrator, at
his or her discretion, may review in
whole or in part the ALJ’s decision. A
provider against which a final order
imposing a CMP is entered may obtain
judicial review.
We specify at § 182.80 the procedures
for a provider to appeal the CMP
imposed by CMS for its noncompliance
with the requirements of § 182.40 to an
ALJ, and for the CMS Administrator, at
his or her discretion, to review in whole
or in part the ALJ’s decision. In so
doing, we apply the following
conforming modifications to the text:
• References to ‘‘hospital’’ are
replaced by the term ‘‘provider.’’ We
note that the term ‘‘provider,’’ as
defined at new 45 CFR 182.20 in this
rule, may also include hospitals.
• References to ‘‘standard charge’’ are
replaced by the term ‘‘cash price.’’
We seek comment on the approach we
are establishing for appeals.
We also set forth in § 182.90 the
consequences for failure of a provider to
request a hearing. If a provider does not
request a hearing within 30 calendar
days of the issuance of the notice of
imposition of a CMP described in
§ 182.70(b), CMS may impose the CMP
indicated in such notice and may
impose additional penalties under
continuing violations according to
§ 182.70(e) without right of appeal. If
the 30th calendar day is a weekend or
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71155
a Federal holiday, then the timeframe is
extended until the end of the next
business day. The provider has no right
to appeal a penalty with respect to
which it has not requested a hearing in
accordance with 45 CFR 150.405, unless
the provider can show good cause, as
determined at § 150.405(b), for failing to
timely exercise its right to a hearing.
D. Medicare Inpatient Prospective
Payment System (IPPS) New COVID–19
Treatments Add-On Payment (NCTAP)
for the Remainder of the Public Health
Emergency (PHE)
1. Section 3710 of the CARES Act IPPS
Add-On Payment for COVID–19 Patients
During the PHE
Section 3710 of the CARES Act
amended section 1886(d)(4)(C) of the
Act to provide for an increase in the
weighting factor of the assigned
Diagnosis-Related Group (DRG) by 20
percent for an individual diagnosed
with COVID–19 discharged during the
period of the PHE for COVID–19. To
implement this temporary adjustment,
Medicare’s claims processing systems
apply an adjustment factor to increase
the Medicare Severity-DRG (MS–DRG)
relative weight that would otherwise be
applied by 20 percent when
determining IPPS operating payments.
For additional information regarding
this add-on payment, including which
claims are eligible for the 20 percent
increase in the MS–DRG weighting
factor, please see the Medicare Learning
Network (MLN) Matters article ‘‘New
COVID–19 Policies for Inpatient
Prospective Payment System (IPPS)
Hospitals, Long-Term Care Hospitals
(LTCHs), and Inpatient Rehabilitation
Facilities (IRFs) due to Provisions of the
CARES Act’’ available on the CMS
website at https://www.cms.gov/files/
document/se20015.pdf.
2. Overview of IPPS New Technology
Add-On Payment
The new medical service or
technology add-on payment policy
under the IPPS provides additional
payments for cases with relatively high
costs involving eligible new medical
services or technologies, while
preserving some of the incentives
inherent under an average-based
prospective payment system. The
payment mechanism is based on the
cost to hospitals for the new medical
service or technology. Sections
1886(d)(5)(K) and (L) of the Act
establish a process of identifying and
ensuring adequate payment for new
medical services and technologies
(sometimes collectively referred to in
this section as ‘‘new technologies’’)
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under the IPPS. The regulations at 42
CFR 412.87 and 412.88 implement these
provisions.
As set forth in § 412.88(b)(2), for a
new technology other than certain
antimicrobial products (for which the
maximum add-on payment is 75
percent), if the costs of a discharge
involving a new technology exceed the
full DRG payment (including payments
for Indirect Medical Education (IME)
and Disproportionate Share Hospital
(DSH), but excluding outlier payments)),
Medicare will make a new technology
add-on payment equal to the lesser of:
(1) 65 percent of the costs of the new
technology; or (2) 65 percent of the
amount by which the costs of the case
exceed the standard DRG payment.
For additional information regarding
IPPS new technology add-on payments
please see the FY 2021 IPPS/LTCH PPS
final rule (85 FR 58602 through 58608).
3. Overview of the Food and Drug
Administration (FDA) Coronavirus
Treatment Acceleration Program
The FDA has created a special
emergency program for possible
coronavirus therapies, the Coronavirus
Treatment Acceleration Program. The
program uses every available method to
move new treatments to patients as
quickly as possible, while at the same
time finding out whether they are
helpful or harmful. The FDA continues
to support clinical trials that are testing
new treatments for COVID–19 so that
valuable knowledge about their safety
and effectiveness can be gained.
Additional information regarding this
program is available on the FDA website
at https://www.fda.gov/drugs/
coronavirus-covid-19-drugs/
coronavirus-treatment-accelerationprogram-ctap.
One aspect of the program is the
issuance by the FDA of EUAs during the
PHE for COVID–19. On February 4,
2020, pursuant to Section 564(b)(1)(C) of
the FD&C Act, the Secretary of the
Department of Health and Human
Services (HHS) determined that there is
a PHE that has a significant potential to
affect national security or the health and
security of United States citizens living
abroad, and that involves the virus that
causes COVID–19.26 On the basis of
such determination, the Secretary of
HHS on March 27, 2020, declared that
circumstances exist justifying the
authorization of emergency use of drugs
and biological products during the
26 U.S. Department of Health and Human
Services, Determination of a Public Health
Emergency and Declaration that Circumstances
Exist Justifying Authorizations Pursuant to Section
564(b) of the Federal Food, Drug, and Cosmetic Act,
21 U.S.C. 360bbb-3. February 4, 2020.
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COVID–19 pandemic, pursuant to
section 564 of the FD&C Act, subject to
terms of any authorization issued under
that section.27
There are currently five drug and
biological products with EUAs issued
during the PHE for COVID–19. In
section ‘‘I. Criteria for Issuance of
Authorization’’ of the current letters of
authorization for these drug and
biological products, the letters for two of
the products state that based on the
totality of scientific evidence available
to FDA, it is reasonable to believe that
the product may be effective in treating
COVID–19, and that, when used under
the conditions described in the
authorization, the known and potential
benefits of the product when used to
treat COVID–19 outweigh the known
and potential risks of such products.28[1]
Those two drug and biological products
are COVID–19 convalescent plasma and
Veklury (remdesivir).
The current letters of authorization for
the other three products used in patients
with suspected or confirmed COVID–19
do not indicate that those products are
treating COVID–19 and instead treat a
disease or condition caused or
exacerbated by COVID–19.29
Specifically, the letter of authorization
for REGIOCIT indicates its use as a
replacement solution in adult patients
in a critical care setting who are being
treated with Continuous Renal
Replacement Therapy (CRRT) and for
whom regional citrate anticoagulation
(RCA) is appropriate; the letter of
authorization for Fresenius Propoven 2
percent Emulsion indicates its use to
maintain sedation via continuous
infusion in patients greater than 16
years old who require mechanical
ventilation in an ICU setting; and the
letter of authorization for multiFiltrate
PRO System and multiBic/multiPlus
Solutions indicates its use in delivering
CRRT in an acute care environment.
While COVID–19 convalescent
plasma has received an EUA for treating
COVID–19 in hospitalized patients,
Veklury (remdesivir), as of October 22,
2020, is the only drug or biological
product approved by FDA for treating
27 U.S. Department of Health and Human
Services, Declaration that Circumstances Exist
Justifying Authorizations Pursuant to Section 564(b)
of the Federal Food, Drug, and Cosmetic Act, 21
U.S.C. 360bbb-3, 85 FR 18250 (April 1, 2020).
28 EUA for COVID–19 convalescent plasma:
https://www.fda.gov/media/141477/download; EUA
for remdesivir: https://www.fda.gov/media/137564/
download.
29 EUA for REGIOCIT: https://www.fda.gov/
media/141168/download; EUA for Fresenius
Propoven 2 percent Emulsion https://www.fda.gov/
media/137888/download; EUA for multiFiltrate
PRO System and multiBic/multiPlus Solutions:
https://www.fda.gov/media/137520/download.
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COVID–19.30 In order for an item or
service to be considered for coverage
under Medicare Part A or Part B, the
item or service must fall within at least
one benefit category established in the
Act. Drugs and biologicals are included
within several such benefit categories.
In general, section 1861(t)(1) of the Act
defines drugs and biologicals to include
drugs or biologicals approved for
inclusion in certain compendia (except
for any drugs and biologicals
unfavorably evaluated therein) or that
are approved by the pharmacy and drug
therapeutics committee (or equivalent
committee) of the medical staff of a
hospital furnishing that drug or
biological for use in that hospital. CMS
has determined that it is appropriate for
CMS to consider drug and biological
products which are authorized for
emergency use for COVID–19, with
letters of authorization, and are used to
treat COVID–19 disease, to fall within
the drugs and biologicals definition in
section 1861(t)(1) of the Act for
Medicare purposes if they are included
or approved for inclusion in the
applicable compendia, or when
furnished by a specific hospital if
approved for use in that hospital by the
pharmacy and drug therapeutics
committee (or equivalent committee) of
the medical staff of that hospital.
More information regarding EUAs for
drug and biological products during the
PHE for COVID–19 is available on the
FDA website at https://www.fda.gov/
emergency-preparedness-and-response/
mcm-legal-regulatory-and-policyframework/emergency-useauthorization#coviddrugs.
4. Overview of IPPS Outlier Payments
Section 1886(d)(5)(A) of the Act
provides for payments in addition to the
basic prospective payments for ‘‘outlier’’
cases involving extraordinarily high
costs. To qualify for outlier payments,
one criterion is that a case must have
costs greater than the sum of the
prospective payment rate for the MS–
DRG, any IME and DSH payments,
uncompensated care payments, any new
technology add-on payments, and the
‘‘outlier threshold’’ or ‘‘fixed-loss’’
amount (a dollar amount by which the
costs of a case must exceed payments in
order to qualify for an outlier payment).
We refer to the sum of the prospective
payment rate for the MS–DRG
(including the Section 3710 of the
CARES Act add-on payment if
applicable), any IME and DSH
payments, uncompensated care
30 FDA approval for remdesivir: https://
www.accessdata.fda.gov/drugsatfda_docs/
appletter/2020/214787Orig1s000ltr.pdf.
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payments, any new technology add-on
payments, and the outlier threshold as
the outlier ‘‘fixed-loss cost threshold.’’
Payments for eligible cases are then
made based on a marginal cost factor,
which is a percentage of the estimated
costs above the fixed-loss cost
threshold. The marginal cost factor is 80
percent for all MS–DRGs except the
burn MS–DRGs, where the marginal cost
factor is 90 percent. For the complete
formula for how an outlier payment is
computed, we refer the reader to the FY
2021 IPPS/LTCH PPS final rule (85 FR
59043 through 59044). We note, for each
claim, per the formula in the FY 2021
IPPS/LTCH PPS final rule, in
determining whether the claim is
eligible for an operating outlier payment
and/or a capital outlier payment, an
‘‘operating outlier threshold’’ and a
‘‘capital outlier threshold’’ are
computed, including application of a
geographic adjustment to account for
local cost variation. If the case is
eligible, an ‘‘operating outlier payment’’
and/or ‘‘capital outlier payment’’ will be
made for an individual claim. For
additional information regarding IPPS
outlier payments please see the FY 2021
IPPS/LTCH PPS final rule (85 FR 59034
through 59041).
5. Eligibility Criteria for an IPPS New
COVID–19 Treatments Add-on Payment
(NCTAP) for the Remainder of the PHE
We believe that as drugs or biological
products become available and are
authorized or approved by FDA for the
treatment of COVID–19 in the inpatient
setting, it would be appropriate to
increase the current IPPS payment
amounts to mitigate any potential
financial disincentives for hospitals to
provide these new treatments during the
PHE. Therefore, effective for discharges
occurring on or after the effective date
of this rule and until the end of the
public health emergency, CMS is using
the exceptions and adjustment authority
under section 1886(d)(5)(I) of the Act to
create a New COVID–19 Treatments
Add-on Payment (NCTAP) under the
IPPS for COVID–19 cases that meet
certain criteria.
First, the case must include the use of
a drug or biological product authorized
to treat COVID–19 as indicated in
section ‘‘I. Criteria for Issuance of
Authorization’’ of the current letter of
authorization for the drug or biological
product, or the drug or biological
product must be approved by the FDA
for treating COVID–19. Because the
purpose of the NCTAP is to mitigate
potential financial disincentives for
hospitals to provide new COVID–19
treatments, this criterion expeditiously
provides assurance in the context of the
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urgency of the PHE that a treatment is
new and is used to treat COVID–19
during the PHE. Currently, there are
only two drug or biological products
that meet this criterion: Veklury
(remdesivir) and COVID–19
convalescent plasma. However, as
additional drug and biological products
become available that meet this
criterion, cases that use those products
would become eligible for the NCTAP if
the remaining criteria are met.
Second, the case must also be eligible
for the 20 percent increase in the
weighting factor for the assigned MS–
DRG for an individual diagnosed with
COVID–19 discharged during the period
of the PHE for COVID–19 under section
3710 of the CARES Act. The primary
purposes of this criterion are to help
appropriately identify COVID–19 cases
to potentially receive the NCTAP, and
ensure for program integrity reasons that
there is a positive COVID–19 laboratory
test documented in the patient’s
medical record. CMS may conduct postpayment medical review to confirm the
presence of a positive COVID–19
laboratory test and, if no such test is
contained in the medical record, the
NCTAP will be recouped.
Third, the operating cost of the case
must exceed the operating Federal
payment under the IPPS, including the
add-on payment under section 3710 of
the CARES Act. The primary purpose of
this criterion is to ensure that the
NCTAP is made only when needed. The
cost of the case is determined by
multiplying the covered charges by the
operating cost-to-charge ratio, the same
way it is determined for new technology
add-on payments and operating outlier
payments.
We note that all generally applicable
statutory and regulatory requirements
during the PHE for Medicare payment
for a particular case must continue to be
met, and that the NCTAP will only be
available to the extent that the new
COVID–19 treatment meets all coverage
requirements under Medicare, including
that the use of a drug or biological
product is medically reasonable and
necessary for that case. No applicable
Medicare requirements during the PHE
are being waived by the creation of the
NCTAP policy.
6. Determination of the IPPS NCTAP
Amount for the Remainder of the PHE
As indicated earlier, the goal of the
NCTAP is to mitigate potential financial
disincentives for hospitals to provide
new COVID–19 treatments. These
potential financial disincentives are
already mitigated in part by the IPPS
outlier payment, but we recognize that
the costs of a case must exceed
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payments by the ‘‘outlier threshold’’ or
‘‘fixed-loss’’ amount before outlier
payments are made. For FY 2021, the
outlier threshold is approximately
$30,000. As discussed previously, the
outlier threshold is adjusted to account
for local cost variation in determining
whether an individual claim is eligible
for outlier payments. As a simplified
example for purposes of illustration, if
the operating costs of a case using a new
COVID–19 treatment exceed the
operating IPPS payment by $10,000,
there are no Medicare outlier payments
made for this case because the costs are
less than the outlier threshold.
We believe that in order to further
mitigate any potential financial
disincentives for hospitals to provide
new COVID–19 treatments, the NCTAP,
when needed, should function to
partially offset costs that exceed the
Medicare payment, but are less than the
outlier threshold. By partially rather
than fully offsetting these costs, we
believe that the NCTAP, similar to the
new technology add-on payment policy
under the IPPS, preserves some of the
incentives inherent under an averagebased prospective payment system. One
way in which the new technology addon payment policy accomplishes this
goal is by making the new technology
add-on payment equal to the lesser of:
(1) 65 percent of the costs of the new
technology; or (2) 65 percent of the
amount by which the costs of the case
exceed the standard DRG payment.
We believe that the new technology
add-on payment calculation provides an
appropriate conceptual framework for
the NCTAP calculation. In the context of
the urgency of the PHE for COVID–19,
however, and the practical and
operational challenges of individually
tailoring the payment calculation to
each new treatment, we believe the
NCTAP calculation should take into
account 65 percent of the amount by
which the costs of the case exceed the
standard DRG payment, without
comparison to 65 percent of the costs of
the new treatment itself. As part of the
approval process for the new technology
add-on payment for a given new
technology, the claims processing
system is modified and tailored to apply
the new technology add-on payment for
that technology using cost and coding
information according to the ‘‘lesser of’’
policy described above. In order to more
expeditiously provide payment for cases
meeting the previously described
criteria in the context of the urgency of
the PHE, we believe the NCTAP
calculation should take into account 65
percent of the amount by which the
costs of the case exceed the standard
DRG payment for all cases that qualify
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for the NCTAP, without comparison to
the costs of the new treatment as under
the ‘‘lesser of’’ policy applicable for the
new technology add-on payment.
We note that a hospital should not
seek additional payment on the claim
for drugs or biologicals procured or
provided by a governmental entity to a
provider at no cost to the provider to
diagnose or treat patients with known or
suspected COVID–19, as described in
the CMS Medicare Claims Processing
Manual, Pub. 100–04, Chapter 32,
Section 67.
CMS will use ICD–10–PCS procedure
codes XW033E5 (Introduction of
Remdesivir Anti-infective into
Peripheral Vein, Percutaneous
Approach, New Technology Group 5)
and XW043E5 (Introduction of
Remdesivir Anti-infective into Central
Vein, Percutaneous Approach, New
Technology Group 5) to identify cases
using remdesivir and ICD–10–PCS
procedure codes XW13325 (Transfusion
of Convalescent Plasma
(Nonautologous) into Peripheral Vein,
Percutaneous Approach, New
Technology Group 5) and XW14325
(Transfusion of Convalescent Plasma
(Nonautologous) into Central Vein,
Percutaneous Approach, New
Technology Group 5) to identify cases
using convalescent plasma. More
information on the new procedure codes
implemented into the International
Classification of Diseases, Tenth
Revision, Procedure Coding System
(ICD–10–PCS) in response to the PHE
for COVID–19 is available on the CMS
website at https://www.cms.gov/files/
document/icd-10-ms-drgs-version-372effective-august-01-2020.pdf. CMS will
issue additional operational instructions
on how eligible cases will be identified,
including any new treatments that may
become available.
We also considered in the
determination of the NCTAP amount
that we did not want to inadvertently
reduce the IPPS operating outlier
payments that the hospital would have
otherwise received for a costly COVID–
19 case given that these outlier
payments already help to mitigate
potential financial disincentives for
hospitals to provide new COVID–19
treatments. Therefore, we do not believe
the calculation of the operating outlier
payments should be impacted by the
NCTAP.
Taking these factors into account,
CMS is setting the NCTAP amount for
a case that meets the NCTAP eligibility
criteria equal to the lesser of: (1) 65
percent of the operating outlier
threshold for the claim or (2) 65 percent
of the amount by which the costs of the
case exceed the standard DRG payment,
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including the adjustment to the relative
weight under section 3710 of the CARES
Act. As with the new technology addon payment and outlier payments, the
costs of the case are determined by
multiplying the covered charges by the
operating cost-to-charge ratio. In
addition, the NCTAP will not be
included as part of the calculation of the
operating outlier payments.
Returning to our simplified example,
if the cost of a case using a new COVID–
19 treatment exceeds the operating IPPS
payment by $10,000 and the operating
outlier threshold for the case is for
purposes of illustration $30,000, the
NCTAP would be $6,500 (= $10,000
excess cost × 0.65). There would be no
outlier payments because the excess
cost of the case ($10,000) does not
exceed the operating outlier threshold
for the case ($30,000).
As a simplified example of a case that
qualifies for an operating outlier
payment, if the cost of a case using a
new COVID–19 treatment exceeds the
operating IPPS payment by $100,000,
the NCTAP would be equal to the
maximum NCTAP amount of 65 percent
of the operating outlier threshold for the
case. In this illustrative example, if the
applicable operating outlier threshold
for the claim is $30,000, that amount is
$19,500 (equals first $30,000 of the
excess cost before the operating outlier
threshold for the claim is reached ×
0.65). In addition, the case would
receive an outlier payment that is
calculated the same way it is currently
calculated in the absence of the $19,500
NCTAP, that is, $56,000 (= ($100,000
excess cost¥$30,000 outlier threshold
for the case) * the 0.80 outlier marginal
cost factor). The combined NCTAP and
outlier payment would be $75,500
(equals the $19,500 enhanced payment
+ the $56,000 outlier payment).
E. Medicare Outpatient Prospective
Payment System (OPPS) Separate
Payment for New COVID–19 Treatments
Policy for the Remainder of the Public
Health Emergency (PHE)
1. FDA Coronavirus Treatment
Acceleration Program
The FDA has created a special
emergency program to facilitate the
development of coronavirus therapies,
the Coronavirus Treatment Acceleration
Program. One aspect of the program is
the issuance by the FDA of EUAs during
the PHE for COVID–19. On February 4,
2020, pursuant to Section 564(b)(1)(C) of
the FD&C Act, the Secretary of the
Department of Health and Human
Services (HHS) determined that there is
a PHE that has a significant potential to
affect national security or the health and
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security of United States citizens living
abroad, and that involves the virus that
causes COVID–19.31 On the basis of
such determination, the Secretary of
HHS on March 27, 2020, declared that
circumstances exist justifying the
authorization of emergency use of drugs
and biologics during the COVID–19
public health emergency, pursuant to
section 564 of the FD&C Act, subject to
terms of any authorization issued under
that section.32 Readers should refer to
Section D.3 of this interim final rule
with comment period for a full
discussion of the Coronavirus Treatment
Acceleration Program.
There are currently five drug and
biological products with EUAs issued
during the PHE for COVID–19. In
section ‘‘I. Criteria for Issuance of
Authorization’’ of the current letters of
authorization for these drug and
biological products, the letters for two of
the products state that based on the
totality of scientific evidence available
to FDA, it is reasonable to believe that
the product may be effective in treating
COVID–19, and that, when used under
the conditions described in the
authorization, the known and potential
benefits of the product when used to
treat COVID–19 outweigh the known
and potential risks of such products.33
Those drug and biological products are
COVID–19 convalescent plasma and
Veklury (remdesivir).
While COVID–19 convalescent
plasma has received an EUA for treating
COVID–19 in hospitalized patients,
Veklury (remdesivir), as of October 22,
2020, is the only drug or biological
product approved by FDA for treating
COVID–19. As discussed in Section
II.D.3 of this interim final rule with
comment period, in order for an item or
service to be considered for coverage
under Medicare Part A or Part B, the
item or service must fall within at least
one benefit category established in the
Act. Drugs and biologicals are included
within several such benefit categories.
In general, section 1861(t)(1) of the Act
defines drugs and biologicals to include
drugs or biologicals approved for
inclusion in certain compendia (except
31 U.S. Department of Health and Human
Services, Determination of a Public Health
Emergency and Declaration that Circumstances
Exist Justifying Authorizations Pursuant to Section
564(b) of the Federal Food, Drug, and Cosmetic Act,
21 U.S.C. 360bbb-3. February 4, 2020.
32 U.S. Department of Health and Human
Services, Declaration that Circumstances Exist
Justifying Authorizations Pursuant to Section 564(b)
of the Federal Food, Drug, and Cosmetic Act, 21
U.S.C. 360bbb-3, 85 FR 18250 (April 1, 2020).
33 EUA for remdesivir: https://www.fda.gov/
media/137564/download; EUA for COVID–19
convalescent plasma: https://www.fda.gov/media/
141477/download.
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for any drugs and biologicals
unfavorably evaluated therein) or that
are approved by the pharmacy and drug
therapeutics committee (or equivalent
committee) of the medical staff of a
hospital furnishing that drug or
biological for use in that hospital. CMS
has determined that it is appropriate for
CMS to consider drug and biological
products which are authorized for
emergency use for COVID–19, with
letters of authorization, and are used to
treat COVID–19 disease, to fall within
the drugs and biologicals definition in
1861(t)(1) of the Act for Medicare
purposes if they are included or
approved for inclusion in the applicable
compendia, or when furnished by a
specific hospital if approved for use in
that hospital by the pharmacy and drug
therapeutics committee (or equivalent
committee) of the medical staff of that
hospital.
2. OPPS Comprehensive-Ambulatory
Payment Classification (C–APC) Policy
To date, no drug or biological product
has an EUA for the treatment of patients
with COVID–19 in the outpatient
setting. However, because treatment of
COVID–19 is rapidly evolving, we
believe it is important to ensure that
separate payment is available under the
OPPS for new drug and biological
products (including blood products)
that receive an EUA for treating COVID–
19 in the outpatient setting or are
approved by the FDA for treating
COVID–19 in the outpatient setting, or
where a drug or biological product
approved under an existing EUA is
authorized for use in settings other than
the inpatient setting. As part of that
process, we expect to include the
addition of new codes describing those
treatments as soon as practicable, after
their availability, to ensure efficient and
timely beneficiary access to those
treatments. We anticipate that most
drugs and biological products
authorized for use in treating COVID–19
in the outpatient setting would be
separately paid under our standard
OPPS payment policy because drugs
and biological products are typically
assigned separate Ambulatory Payment
Classification payment status indicators
in the OPPS unless they meet one of the
criteria for packaging, which, with the
exception of drug or biological products
billed with a Comprehensive
Ambulatory Payment Classification (C–
APC) service, we do not anticipate that
drugs or biological products approved
or authorized to treat COVID–19 would
meet. However, these products could be
packaged into a C–APC when provided
on the same claim as a C–APC service,
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in which case separate payment would
not be made for these products.
Under our C–APC policy, which we
adopted beginning in CY 2015, we
designate a service described by a
HCPCS code assigned to a C–APC as the
primary service when the service is
identified by OPPS status indicator
‘‘J1’’. When such a primary service is
reported on a hospital outpatient claim,
with certain exceptions, we make
payment for all other items and services
reported on the hospital outpatient
claim as being integral, ancillary,
supportive, dependent, and adjunctive
to the primary service (hereinafter
collectively referred to as ‘‘adjunctive
services’’) and representing components
of a complete comprehensive service (78
FR 74865 and 79 FR 66799). Payments
for adjunctive services are packaged into
the payments for the primary services.
This results in a single prospective
payment for each of the primary,
comprehensive services based on the
costs of all reported services at the claim
level. Items included in the packaged
payment provided in conjunction with
the primary service also include all
drugs, biologicals, and
radiopharmaceuticals, regardless of cost,
except those drugs with pass-through
payment status and self-administered
drugs, unless they function as packaged
supplies (78 FR 74868 through 74869
and 74909 and 79 FR 66800). Thus,
under our current policy, payment for
drugs or biological products with an
emergency authorization or approved to
treat COVID–19 in the outpatient setting
would be packaged into payment for a
primary C–APC service when billed on
the same claim as that service.
Currently, there are 67 C–APCs in the
CY 2020 OPPS, with payments ranging
from approximately $1,000 to $37,000.
Most C–APCs are for surgical or other
intensive procedures, which we would
expect most hospital outpatient
departments would not perform on a
patient that has an active case of
COVID–19. However, observation
services can also be paid through the
‘‘Comprehensive Observation Services’’
C–APC (C–APC 8011), which packages
payment for qualifying extended
assessment and management
encounters. It is possible that future
COVID treatments that are authorized or
approved for use in the outpatient
setting might be administered to
patients under observation while the
provider determines if the patient needs
to be admitted to the hospital for
COVID–19.
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71159
3. Separate Payment Under the OPPS for
New COVID–19 Treatments for the
Remainder of the PHE for COVID–19
Although we do not expect that many
beneficiaries would both receive a
primary C–APC service and a drug or
biological for treating COVID–19, we
nonetheless believe that as drugs or
biologicals become available and are
authorized or approved for the
treatment of COVID–19 in the outpatient
setting, it would be appropriate to
mitigate any potential financial
disincentives for hospitals to provide
these new treatments during the PHE for
COVID–19. Therefore, effective for
services furnished on or after the
effective date of this rule and until the
end of the PHE for COVID–19, CMS is
creating an exception to its OPPS C–
APC policy to ensure separate payment
for new COVID–19 treatments that meet
certain criteria. Under this exception,
any new COVID–19 treatment that
meets the two criteria below will, for the
remainder of the PHE for COVID–19,
always be separately paid and will not
be packaged into a C–APC when it is
provided on the same claim as the
primary C–APC service. Note that this
separate payment will result in an
additional copayment of 20 percent of
the cost of the new COVID–19
treatment, up to the amount of the
inpatient deductible.
CMS has identified two criteria for
COVID–19 treatments to receive this
exception. First, the treatment must be
a drug or biological product (which
could include a blood product)
authorized to treat COVID–19, as
indicated in section ‘‘I. Criteria for
Issuance of Authorization’’ of the letter
of authorization for the drug or
biological product, or the drug or
biological product must be approved by
the FDA for treating COVID–19. Because
the purpose of this exception is to
mitigate potential financial
disincentives for hospitals to provide
new COVID–19 treatments, this
criterion expeditiously provides
assurance in the context of the urgency
of the PHE for COVID–19 that a
treatment is new and is used to treat
COVID–19 disease during the PHE for
COVID–19.
Second, the EUA for the drug or
biological product (which could include
a blood product) must authorize the use
of the product in the outpatient setting
or not limit its use to the inpatient
setting, or the product must be approved
by the FDA to treat COVID–19 disease
and not limit its use to the inpatient
setting.
We note that during the PHE for
COVID–19 this new exception to the C–
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APC packaging policy would apply to
all drug and biological products that
meet both of these criteria. As of the
date of issuance of this interim final rule
there are two drug or biological
products that meet the first criterion
(Veklury (remdesivir) and COVID–19
convalescent plasma), but neither of
these products is authorized or
approved for use in the outpatient
setting and, as a result, no product
meets the second criterion.
We also note that all generally
applicable statutory and regulatory
requirements for Medicare payment
under the OPPS must continue to be
met, and that OPPS payment will only
be available to the extent that the new
COVID–19 treatment meets all coverage
requirements under Medicare, including
that the use of a drug or biological
product is medically reasonable and
necessary for the patient. No applicable
Medicare requirements during the PHE
are being waived by the creation of this
C–APC exception.
4. Effects of This Exception on the OPPS
Budget Neutrality Calculation
As we noted in Section II.E.2, we
believe it would be a fairly rare
occurrence that an outpatient
department would perform a C–APC
procedure on a beneficiary being treated
for COVID–19 because most C–APCs are
for surgical or other intensive
procedures and we would expect most
hospital outpatients departments would
not perform outpatient surgery on a
patient that has an active case of
COVID–19. While it is possible that
future COVID–19 treatments that are
authorized or approved for use in the
outpatient setting might be administered
to patients under observation while the
provider determines if the patient needs
to be admitted to the hospital for
COVID–19, it is our expectation that this
hypothetical situation would not
happen frequently. Because we believe
a new COVID–19 treatment will rarely
be provided on the same claim as a
primary C–APC service, we believe new
COVID–19 treatments used in the
outpatient setting will be separately
paid under current policy the vast
majority of the time. As a result, we do
not believe it is necessary that we make
an adjustment to OPPS budget
neutrality calculations at this time to
account for this new exception, as any
budgetary effect of this new exception is
likely to be de minimis. If, once new
COVID–19 treatments are being
provided in the outpatient setting, the
claims data indicates that these
treatments are being provided on the
same claim as a C–APC more frequently
than we expected, we can make a
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prospective adjustment to the OPPS
budget neutrality calculations through
future rulemaking.
F. Temporary Increase in Federal
Medicaid Funding
1. Background
Section 6008 of the FFCRA, as
amended by section 3720 of the CARES
Act, provides a temporary 6.2
percentage point increase to each
qualifying state and territory’s Federal
Medical Assistance Percentage (FMAP)
under section 1905(b) of the Act
(‘‘temporary FMAP increase’’). This
temporary FMAP increase is effective
beginning January 1, 2020 and could
extend through the last day of the
calendar quarter in which the PHE for
COVID–19, including any extensions,
terminates, if the state claims the FMAP
increase in that quarter (we refer herein
to the entire period where the FMAP
increase is potentially applicable as the
‘‘increased FMAP period’’).
To qualify for the temporary FMAP
increase in a given quarter, states must
meet the four conditions described in
subsection (b) of section 6008 of the
FFCRA during that quarter. Three of
these conditions (described at section
6008(b)(1), (2), and (4) of the FFCRA)
could extend through the end of the
increased FMAP period, if the state
claims the increased FMAP through the
end of the quarter in which the PHE for
COVID–19 ends. They are: (a) The state
must maintain eligibility standards,
methodologies, or procedures that are
no more restrictive than what the state
had in place as of January 1, 2020; (b)
the state may not charge premiums that
exceed those that were in place as of
January 1, 2020; 34 and (c) the state must
cover, without the imposition of cost
sharing, testing services and treatments
for COVID–19, including vaccines,
specialized equipment, and therapies.
The fourth condition, which is
described at section 6008(b)(3) of the
FFCRA, extends through the last day of
the month in which the PHE for
COVID–19 ends. This condition
provides that a state may not receive the
temporary FMAP increase if ‘‘the [s]tate
fails to provide that an individual who
is enrolled for benefits under [the
Medicaid state] plan (or waiver) as of
the date of enactment of this section
[March 18, 2020] or enrolls for benefits
34 Section 3720 of the CARES Act added a new
subsection (d) to section 6008 of the FFCRA in
order to provide states which have increased
premiums for any Medicaid beneficiaries above the
amounts in effect on January 1, 2020, with a 30-day
grace period to restore premiums to amounts no
greater than those in effect as of January 1 without
jeopardizing the state’s eligibility for the temporary
6.2 percentage point FMAP increase.
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under such plan (or waiver) during the
period beginning on such date of
enactment [March 18, 2020] and ending
the last day of the month in which the
[PHE for COVID–19] ends shall be
treated as eligible for such benefits
through the end of the month in which
such emergency period ends unless the
individual requests a voluntary
termination of eligibility or the
individual ceases to be a resident of the
State[.]’’
The language in section 6008(b)(3) of
the FFCRA is somewhat ambiguous.
CMS issued guidance on this condition
through frequently asked questions
(FAQs) posted on Medicaid.gov on
April 13, 2020, May 5, 2020, and June
30, 2020.35 However, our existing
interpretation (discussed in section
II.F.2 of this preamble) is not the only
possible interpretation that could be
made. As the PHE for COVID–19
continued, and states requested
increased flexibility for managing their
programs, we revisited our existing
interpretation. Seeking to balance the
beneficiary protections in our existing
interpretation with the state flexibility
that could be afforded through an
alternative interpretation, this IFC
establishes a blended approach as
discussed below.
2. CMS’s Existing Interpretation of
Section 6008(b)(3) of the FFCRA
CMS first provided an interpretation
of section 6008(b)(3) for implementation
by states through FAQs issued in April
2020. Our most recent interpretation
provided that to receive the increased
FMAP under the FFCRA, a state must
keep beneficiaries enrolled in Medicaid,
if they were enrolled on or after March
18, 2020, with the same amount,
duration, and scope of benefits. It also
provided that states could not subject
such beneficiaries to any increase in
cost sharing or beneficiary liability for
institutional services or other long-term
services and supports (LTSS) during
this time period. This interpretation
35 See:
• COVID–19 Frequently Asked Questions (FAQs)
for State Medicaid and Children’s Health Insurance
Program (CHIP) Agencies, available at https://
www.medicaid.gov/state-resource-center/
downloads/covid-19-faqs.pdf (Updated June 30,
2020)
• Families First Coronavirus Response Act—
Increased FMAP FAQs available at https://
www.medicaid.gov/state-resource-center/
downloads/covid-19-section-6008-faqs.pdf
(Updated April 13, 2020)
• Families First Coronavirus Response Act
(FFCRA), Public Law 116–127 Coronavirus Aid,
Relief, and Economic Security (CARES) Act, Public
Law 116–136 Frequently Asked Questions (FAQs)
available at https://www.medicaid.gov/stateresource-center/downloads/covid-19-section-6008CARES-faqs.pdf (Posted April 13, 2020)
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protects both beneficiary eligibility and
access to medically necessary services.
Under this interpretation, if a state
receives information about a
beneficiary’s change in circumstances
that would make the beneficiary
ineligible for Medicaid, the state may
not terminate that beneficiary’s
eligibility until the end of the month in
which the PHE for COVID–19 ends,
except in cases where the beneficiary
voluntarily disenrolls or is no longer a
resident of the state. Further, if the state
receives information that would make a
beneficiary eligible for a different
eligibility group with lesser benefits,
greater cost sharing, or increased
beneficiary liability, the state may not
transition that beneficiary to the new
eligibility group but must maintain the
beneficiary’s enrollment in the current
eligibility group until the end of the
month in which the PHE for COVID–19
ends.36
In protecting access to medically
necessary services pursuant to this
interpretation, states must maintain
current coverage in the state plan,
including alternative benefit plans
(ABPs), and must also maintain current
coverage under any waivers and section
1115 demonstrations. For example,
states may not implement any new
restrictions such as a reduction in the
number of covered visits or a prior
authorization requirement. Beneficiary
coverage may not be reduced on an
individual basis either. For example, if
a beneficiary has reached age 21 and
would no longer be eligible for the Early
and Periodic Screening, Diagnostic, and
Treatment (EPSDT) benefit, the state
must continue to provide EPSDT
services to the beneficiary when
medically necessary, through the end of
the month in which the PHE for
COVID–19 ends. Further, if a
beneficiary is enrolled in a home and
community-based services (HCBS)
waiver program authorized under
section 1915(c) of the Act, and the
individual is determined to no longer
36 See Question B.12 of the Families First
Coronavirus Response Act—Increased FMAP FAQs
available at https://www.medicaid.gov/stateresource-center/downloads/covid-19-section-6008faqs.pdf; Question F.27 of the Families First
Coronavirus Response Act (FFCRA), Public Law
116–127 Coronavirus Aid, Relief, and Economic
Security (CARES) Act, Public Law 116–136
Frequently Asked Questions posted on April 13,
2020, available at https://www.medicaid.gov/stateresource-center/downloads/covid-19-section-6008CARES-faqs.pdf; and Questions relating to
Continuing Coverage under Section 6008 of the
Families First Coronavirus Response Act in the
COVID–19 Frequently Asked Questions (FAQs) for
State Medicaid and Children’s Health Insurance
Program (CHIP) Agencies available at https://
www.medicaid.gov/state-resource-center/
downloads/covid-19-faqs.pdf
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meet the level-of-care requirements or
other requirements for that waiver, the
state must maintain the beneficiary’s
enrollment in the HCBS waiver. Under
this interpretation, states are not
required to provide services that do not
meet the state plan amount, duration,
and scope criteria for a benefit (such as
medical necessity). However, as a
condition for receiving the temporary
FMAP increase, the state must ensure
that a beneficiary can continue to access
the benefits package that was available
to that beneficiary as of March 18, 2020
(or a later date within the PHE) through
the end of the month in which the PHE
for COVID–19 ends.
States have expressed concern that
our existing interpretation of section
6008(b)(3) of the FFCRA makes it
challenging for them to manage their
programs effectively and still qualify for
the increased Federal financial
participation, in frustration of one
purpose of section 6008 of the FFCRA
to provide additional support to state
Medicaid programs in their response to
the COVID–19 pandemic. States made
clear to CMS that this interpretation,
coupled with the prohibition on
adopting more restrictive eligibility
standards, methodologies, or procedures
under section 6008(b)(1) of the FFCRA,
would impede the routine, orderly
transition of beneficiaries between
eligibility groups, and could lead to
significant backlogs in redeterminations
and appeals after the PHE for COVID–
19 ends.
States also noted that our existing
interpretation severely limits state
flexibility to control program costs in
the face of growing budgetary
constraints and developing fiscal
challenges during the emergency period.
For example, it freezes post-eligibility
treatment-of-income (PETI) calculations
for institutionalized beneficiaries
regardless of changes in circumstances.
States have pointed out that a
beneficiary receiving HCBS through a
waiver approved under section 1915(c)
of the Act who is subject to the PETI
rules and who subsequently moves into
an institution would be entitled to
retain the higher personal needs
allowance allowed for individuals
participating in the relevant waiver,
even though the beneficiary’s personal
needs would be far lower once in the
institution. The aggregate effects of this
interpretation could result in a
substantial increase in the state
Medicaid program’s cost for the needed
institutional services as beneficiaries are
not contributing as much toward the
cost of their care as they would be in the
absence of the FFCRA 6008(b)(3)
requirement.
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In practice, the only cost-controlling
measure available to states under our
existing interpretation is reducing
provider rates to the minimum level
permitted under section 1902(a)(30)(A)
of the Act. Such rate cuts, combined
with a substantially lower volume of
visits since the beginning of the
pandemic,37 could put some providers
out of business. This could undermine
the solvency of critical provider
networks and their ability to serve
beneficiaries in the future, particularly
in rural areas where health care
workforce shortages may already exist.
3. Alternative Interpretation of Section
6008(b)(3) of the FFCRA
CMS’s existing interpretation of
section 6008(b)(3) of the FFCRA is not
the only possible, reasonable
interpretation of that provision. The
language in this section could also
reasonably be interpreted to mean only
that states must maintain the enrollment
of beneficiaries who enrolled in the
state’s Medicaid program as of or after
March 18, 2020, through the end of the
month in which the PHE ends, but not
the specific benefits package they were
receiving at that time. In other words,
under this alternative interpretation, to
fulfill the requirement in section
6008(b)(3) of the FFCRA with respect to
a beneficiary who becomes ineligible for
enrollment in his current Medicaid
eligibility group, states would either (a)
transition the beneficiary to another
group for which he is eligible and enroll
him for the benefits provided to that
eligibility group, or (b) retain the
beneficiary’s enrollment in the original
eligibility group, if he did not meet the
eligibility criteria for any other group,
and maintain the benefits provided to
that group. Under this alternative
interpretation, a state would be required
to move a beneficiary who becomes
eligible for another Medicaid eligibility
group during the period in which
section 6008(b)(3) of the FFCRA applies
into that new group, no matter how
limited the benefits package is for the
new group. We refer to this alternative
interpretation as the ‘‘enrollment
interpretation.’’
Under the enrollment interpretation,
states claiming the 6.2 percentage point
temporary FMAP increase would be
permitted to make programmatic
changes, such as changes to the medical
necessity criteria or utilization control
procedures in determining coverage for
benefits; elimination of optional benefits
37 Source: Ateev Mehrotra et al., The Impact of
the COVID–19 Pandemic on Outpatient Visits:
Practices Are Adapting to the New Normal
(Commonwealth Fund, June 2020). https://doi.org/
10.26099/2v5t-9y63
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coverage; increases in cost-sharing
responsibilities (except with respect to
testing services and treatments for
COVID–19 per section 6008(b)(4) of the
FFCRA); or changes to the PETI
methodology. For example, states would
be permitted to establish a limit on the
number of visits permitted for a given
service and to require a copayment for
a service in accordance with Medicaid
statute and regulations. These
programmatic changes would not
jeopardize the state’s receipt of the
temporary FMAP increase.
In considering this interpretation, we
note that Congress expressly
conditioned receipt of the temporary
FMAP increase on a state’s temporarily
not implementing ‘‘more restrictive’’
‘‘eligibility standards, methodologies, or
procedures’’ in section 6008(b)(1), on
temporarily not imposing higher
premiums in section 6008(b)(2), and on
covering COVID–19 testing and
treatment services without cost-sharing
in section 6008(b)(4). However,
Congress did not legislate with the same
express clarity in section 6008(b)(3)
with respect to states’ ability or inability
to reduce the amount, duration, and
scope of benefits other than COVID–19
testing and treatment services or to
eliminate optional benefits. Further,
while Congress expressly prohibited
states from imposing cost sharing on
testing services and treatments for
COVID–19 in section 6008(b)(4) of the
FFCRA, Congress did not expressly
provide in section 6008(b)(3) for any
limitation on cost sharing, or on states’
ability to modify cost sharing or
beneficiaries’ liability for the cost of
other services (e.g., in accordance with
the PETI rules set forth in 42 CFR part
435, subpart H, and 42 CFR 435.832 for
beneficiaries receiving institutional
services or other long-term services and
supports who are subject to the PETI
rules).
Under the enrollment interpretation,
states would be required to make
individual beneficiary eligibility
changes short of disenrollment from
Medicaid entirely. For example, states
would be required to make changes to
a beneficiary’s eligibility to reflect a
change in income, or a change related to
age, pregnancy status, need for LTSS or
other eligibility factors. A change of
service, such as moving from
participation in an HCBS waiver
authorized under section 1915(c) of the
Act into an institution or vice versa,
would also require a change in
eligibility for a beneficiary enrolled in
an eligibility group specific to HCBS
recipients, such as the group described
at 42 CFR 435.217, or an eligibility
group for individuals living in an
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institution like the special income level
group described at 42 CFR 435.236.
The enrollment interpretation would
require states to move a beneficiary who
loses eligibility under one Medicaid
eligibility group and becomes eligible in
a second Medicaid eligibility group into
the second eligibility group, even if the
second eligibility group confers lesser
benefits or results in increased financial
liability for the beneficiary. However, as
with our existing interpretation, under
the enrollment interpretation states
would not be permitted to terminate a
beneficiary’s eligibility unless the
individual requested such termination
or was no longer a state resident. If a
beneficiary loses eligibility under one
Medicaid eligibility group and is not
eligible for another group, in order to
claim the temporary FMAP increase, the
state must maintain the beneficiary’s
enrollment in the current group until
the end of the month in which the PHE
for COVID–19 ends. Like the
programmatic changes discussed
previously, individual beneficiary
eligibility changes would not jeopardize
receipt of the temporary FMAP increase.
In most cases, transferring a
beneficiary from one eligibility group to
another would not result in a significant
change in available benefits. With a few
exceptions, Medicaid is considered to
be minimum essential coverage (MEC)
as defined in section 5000A(f) of the
Internal Revenue Code of 1986 (‘‘Code’’)
and implementing regulations at 26 CFR
1.5000A–2. Certain Medicaid eligibility
groups, however, such as the optional
eligibility group for individuals infected
with tuberculosis (described at 42 CFR
435.215), provide only limited benefits
pursuant to the matter following section
1902(a)(10)(G) of the Act. This optional
coverage of tuberculosis and
tuberculosis-related services is excepted
from the definition of MEC at 26 CFR
1.5000A–2(b)(2)(ii) and transferring a
beneficiary from an eligibility group that
provides MEC to the eligibility group for
individuals infected with tuberculosis
would result in a significant reduction
in available benefits.
Another example of non-MEC
coverage available through Medicaid is
the optional eligibility group limited to
family planning and related services at
42 CFR 435.214, which also provides
only a limited benefits package pursuant
to the matter following section
1902(a)(10)(G) of the Act, and which is
excluded from MEC at 26 CFR 1.5000A–
2(b)(2)(i). If the enrollment
interpretation was adopted, following
the postpartum period for coverage of
pregnant women at 42 CFR 435.116,
states that cover the optional family
planning group (or that provide family
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planning-only coverage through a
section 1115 demonstration) would be
required to transfer women who do not
qualify for a full-benefit Medicaid
eligibility group into family planningonly coverage if they meet the eligibility
requirements for the family planningonly group or demonstration.
The enrollment interpretation of
section 6008(b)(3) of the FFCRA would
make it more challenging for some
beneficiaries to access medically
necessary services, including services
related to the COVID–19 pandemic. A
beneficiary transferred to the family
planning group following the end of her
postpartum period would continue to
have access to provider visits for family
planning and outpatient drugs and
supplies related to those visits, but she
would no longer have access to testing
services and treatment for COVID–19,
pursuant to CMS’s interpretation of
section 6008(b)(4) of the FFCRA, which
is discussed above in section II.B. In
addition, she would lose access to
inpatient and outpatient hospital
services, prescription drugs, and other
Medicaid-covered services that are
unrelated to family planning.
Beneficiaries with certain chronic
conditions like diabetes and sickle cell
disease are at higher risk for severe
illness from the virus that causes
COVID–19.38 Under the enrollment
interpretation, individuals who lose
eligibility for a group that offers MEC
may be transitioned to a limited benefit
eligibility group, in a state that offers
such coverage, in which they would no
longer have access to the benefits
needed to manage their chronic
conditions. Not only would this
negatively impact the beneficiary who
loses comprehensive Medicaid coverage
as a result of this interpretation, but it
could also undermine states’ COVID–19
response efforts during the public health
emergency.
4. Adopting a Blended Approach
As we considered changing our
interpretation of section 6008(b)(3) of
the FFCRA, CMS examined the
implications of both the existing and
alternative interpretations on each of the
major Medicaid stakeholder groups.
Based on that analysis, this IFC adopts
a blended approach. It is intended to
balance the interests of states, providers,
and beneficiaries, without materially
undermining their ability to address the
challenges presented by COVID–19.
38 Centers for Disease Control and Prevention,
Coronavirus Disease 2019 (COVID–19); People with
Certain Medical Conditions; accessed 10/08/2020 at
https://www.cdc.gov/coronavirus/2019-ncov/needextra-precautions/people-with-medicalconditions.html.
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Looking first at states, the
circumstances facing each state during
the PHE for COVID–19 are different.
States have sent a strong message to
CMS that they need more flexibility to
make choices that meet their unique
needs. They have made clear that our
existing interpretation of section
6008(b)(3) of the FFCRA has interfered
with their ability to implement costsaving decisions in the face of
increasing beneficiary enrollment and
declining state revenues. The
enrollment interpretation would allow
states to impose coverage limitations
that reduce spending and allow for
better management of state programs
during the PHE for COVID–19. More
flexibility in managing their programs
could help states to stretch scarce
financial resources over the long term,
including after the PHE for COVID–19
ends, and that could ultimately benefit
both providers and beneficiaries.
Supporting states and providers fighting
the pandemic is consistent with the
protections and the various provider
relief funds established by Congress in
the FFCRA, the CARES Act, and the
PPPHCEA.
While the enrollment interpretation of
section 6008(b)(3) of the FFCRA may be
the preferred option for states, we
recognize that it could negatively
impact certain provider types. Under
the enrollment interpretation, states
could eliminate optional benefits. For
example, a state could cut its optional
dental benefit, and dentists in that state
would lose Medicaid reimbursement.
CMS’s existing interpretation, however,
leaves states with little ability to manage
program costs other than by cutting
provider rates to the fullest extent
permitted under section 1902(a)(30)(A)
of the Act. We believe such rate cuts
represent a far more significant threat to
providers and their continued
availability to beneficiaries. Under the
enrollment interpretation, states may be
less likely to reduce provider rates,
which could benefit both providers and
beneficiaries.
Considering the impact on
beneficiaries, our existing interpretation
provided the strongest protections for
beneficiary access to medically
necessary care during the PHE. It
ensured that beneficiaries remained
enrolled in Medicaid and that no new
coverage restrictions were imposed.
Every Medicaid beneficiary who had
access to MEC and to testing services
and treatment for COVID–19 as of or
after March 18, 2020 would continue to
have access to these services under the
existing interpretation. The enrollment
interpretation would also protect
beneficiary enrollment in Medicaid. At
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the same time, it would expand state
flexibility to make cost-saving decisions
that could reduce beneficiaries’
coverage below what they had access to
as of or after March 18, 2020. Under the
enrollment interpretation, some
beneficiaries would be transitioned from
MEC to non-MEC coverage, which may
not include testing services and
treatment for COVID–19 pursuant to
CMS’s interpretation of FFCRA section
6008(b)(4). Ensuring access to testing
and treatment, along with care for the
chronic health conditions that place
beneficiaries at higher risk for COVID–
19, is important for fighting the
pandemic.
Seeking to balance the needs of each
stakeholder group, both in fighting the
pandemic and ensuring long-term
program sustainability, this IFC adopts
a blended approach to interpreting
section 6008(b)(3) of the FFCRA. This
blended approach adopts the state
flexibility available through the
enrollment interpretation—allowing
states to make programmatic changes to
benefits and cost sharing and to
transition individual beneficiaries
between eligibility groups with differing
benefit packages—while also
establishing parameters to prevent
beneficiaries from losing access to
comprehensive coverage, consistent
with our existing interpretation, through
the end of the month in which the PHE
for COVID–19 ends.
This blended approach is expected to
give states more flexibility, beyond what
is available under our existing
interpretation, to manage their Medicaid
programs. This is consistent with
section 1902(a)(4) of the Act, which
requires the state plan to provide for
such methods of administration as are
necessary for the proper and efficient
operation of the plan. CMS is also
exercising its general rulemaking
authority under sections 1102 and
1902(a)(19) of the Act to establish
parameters under which states must
operate when they exercise the
flexibility that CMS is providing with
respect to compliance with section
6008(b)(3) of the FFCRA.
The parameters established by this
IFC will help to ensure that states are
determining eligibility, and providing
care and services, in a manner that is
consistent with the simplicity of
administration, as described in section
1902(a)(19) of the Act. Under this
blended approach, CMS is giving states
a wider degree of flexibility to effectuate
enrollment transitions during the PHE
for COVID–19, which could decrease
backlogs in redeterminations and
appeals following the PHE for COVID–
19, thereby simplifying state
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71163
implementation of the conditions in
FFCRA section 6008(b)(3) and
administration of the state plan. These
parameters are also expected to help
ensure that states are determining
eligibility, and providing care and
services, in a manner that is consistent
with the best interests of beneficiaries,
as described in section 1902(a)(19) of
the Act. That is because CMS is giving
states less flexibility to reduce
beneficiaries’ coverage under this
blended approach than might be
available to states under the enrollment
interpretation, in an effort to help
protect beneficiaries’ access to
potentially necessary medical care
during the period in which the FFCRA
6008(b)(3) requirement applies. We
therefore believe this blended approach
balances the interests of all stakeholders
consistent with the statute.
This IFC adds a new subpart G,
Temporary FMAP Increase During the
Public Health Emergency for COVID–19,
to 42 CFR part 433, including a new
§ 433.400. Section 433.400(a) describes
the statutory basis for this provision,
while § 433.400(b) provides definitions
specific to this subpart. As described in
detail below, § 433.400(c) requires
states, as a condition for receiving the
temporary FMAP increase, to maintain
beneficiary enrollment in an eligibility
group that provides one of three tiers of
coverage through the end of the month
in which the PHE for COVID–19 ends,
except under the circumstances
specified in paragraph (d). This
provision generally does not require
states to provide the exact same (or
greater) amount, duration, and scope of
medical assistance, or maintain the costsharing or PETI liability for a particular
beneficiary at the same (or lower) level
that was applicable to the beneficiary as
of March 18, 2020 or subsequent date of
initial enrollment during the PHE.
Section 433.400 is effective immediately
upon display of this rule. CMS’ previous
interpretation, as described in section
II.F.2. of this preamble, continues to
apply from the beginning of the quarter
up to the date that this IFC is displayed.
5. Maintaining Enrollment in the Same
Tier of Coverage
As discussed, we believe that
interpreting FFCRA section 6008(b)(3)
only to require continued enrollment in
a state’s Medicaid program (even if
benefits are strictly limited), could have
significant negative consequences for
both beneficiaries and efforts to combat
the COVID–19 pandemic. Some
beneficiaries may transition from
medical assistance that qualifies as MEC
to non-MEC coverage, and some may
even lose access to COVID–19 testing
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services and treatment. CMS has not
interpreted section 6008(b)(4) of the
FFCRA to require state Medicaid
programs to cover COVID–19 testing
services and treatment for beneficiaries
whose Medicaid eligibility is limited by
statute or under existing section 1115
demonstration authority to coverage for
care and services that are for a specific
(non-COVID–19-related) condition,
disease or purpose and that would not
otherwise include COVID–19 testing
and treatment services.
Consistent with the blended approach
to interpreting section 6008(b)(3) of the
FFCRA that is described above, and
consistent with section 1902(a)(4) and
(a)(19) of the Act, we are requiring states
to ensure that beneficiaries who were
validly enrolled for benefits as of or
after March 18, 2020 with access to
minimum essential coverage retain
access to minimum essential coverage,
and to ensure that beneficiaries with
access to testing services and treatment
for COVID–19 maintain access to those
services.
We believe it is reasonable to interpret
the term ‘‘enrolled for benefits’’ in
section 6008(b)(3) to mean validly
enrolled, such that those who were
erroneously enrolled are not to be
considered ‘‘enrolled for benefits’’ for
purposes of FFCRA section 6008.
Therefore, we define ‘‘validly enrolled’’
at § 433.400(b) to mean that the
beneficiary was enrolled in Medicaid
based on a determination of eligibility,
including during the retroactive
eligibility period, and that the
beneficiary was not erroneously granted
eligibility at the point of application or
last redetermination (if such last
redetermination was completed prior to
March 18, 2020) because of: (1) Agency
error; or (2) fraud (as evidenced by a
fraud conviction) or abuse (as
determined following the completion of
an investigation pursuant to 42 CFR
455.15 and 455.16) attributed to the
beneficiary or the beneficiary’s
representative which was material to the
determination of eligibility. Terminating
the eligibility of beneficiaries who are
not validly enrolled as defined at
§ 433.400(b) will not impact a state’s
ability to claim the temporary FMAP
increase. We note that prior to
termination, however, the state must
complete a redetermination consistent
with 42 CFR 435.916 and provide the
beneficiary with advance notice and the
opportunity for a fair hearing consistent
with 42 CFR part 431, subpart E.
Additionally, individuals receiving
medical assistance during a
presumptive eligibility period in
accordance with section 1902(a)(47) of
the Act and 42 CFR part 435, subpart L,
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Jkt 253001
have not received a determination of
eligibility by the state under the state
plan and therefore are not considered to
be validly enrolled for continuous
coverage under section 6008(b)(3) of the
FFCRA.
In order to receive the temporary
FMAP increase (defined at § 433.400(b))
for any quarter in which it is available,
a state must meet the requirements
described in paragraph (c). As described
in § 433.400(c)(1)(i), for the quarter in
which this rule becomes effective, states
would be expected to meet the
requirements described in
§ 433.400(c)(2) and (3) only from the
date of display through the end of the
quarter. CMS’ previous interpretation,
as described in section II.F.2. of this
preamble and in the FAQs cited therein,
continues to apply from the beginning
of the quarter up to the date this rule is
effective. For all quarters following the
effective date of this rule, states would
be expected to meet the requirements of
§ 433.400(c) for the entirety of the
quarter in order to claim the temporary
FMAP increase.
Section 433.400(c)(2) requires states
to maintain the enrollment of all
beneficiaries who were validly enrolled
on or after March 18, 2020. Paragraphs
(c)(2)(i), (ii), and (iii) of 433.400
establish safeguards for the maintenance
of enrollment. For beneficiaries who
were not validly enrolled during this
period, and whom the state is therefore
permitted to disenroll, the state must
provide advance notice of termination
and fair hearing rights in accordance
with 42 CFR 435.917 and 42 CFR part
431, subpart E, when terminating
coverage.
Consistent with the Secretary’s
rulemaking authority under section
1102 of the Act and section 1902(a)(19)
of the Act, which provides for such
safeguards as are needed to ensure that
care and services are provided in a
manner consistent with the best
interests of beneficiaries, § 433.400(c)(2)
establishes three tiers of Medicaid
coverage. These coverage tiers will help
to ensure that beneficiaries protected
under section 6008(b)(3) of the FFCRA
in states claiming the temporary FMAP
increase, who no longer meet eligibility
requirements for the initial eligibility
group in which they are enrolled but
who become eligible under a different
eligibility group or who lose Medicaid
eligibility entirely, do not experience a
reduction in covered benefits that
would be inconsistent with section
1902(a)(19) of the Act, or with our
interpretation of sections 6008(b)(3) and
(4) of the FFCRA.
The first tier of coverage, under
paragraph (c)(2)(i) of § 433.400, consists
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of Medicaid coverage that meets the
definition of MEC, as defined in section
5000A(f) of the Code and implementing
regulations at regulation at 26 CFR
1.5000A–2. Under § 433.400(c)(2)(i)(A),
for beneficiaries whose Medicaid
coverage as of or after March 18, 2020
meets the definition of MEC, the state
must generally continue to provide
Medicaid coverage that meets the
definition of MEC throughout the period
in which this rule applies. This means
that if a state determines a beneficiary
ineligible for the group in which he or
she is currently enrolled, which
provides MEC, and finds the beneficiary
eligible for another group that also
provides MEC, the state would
transition the beneficiary to the new
eligibility group. In contrast, if the
beneficiary lost eligibility for a group
that provides MEC, but gained eligibility
for coverage that does not meet the
definition of MEC, the state may not
move the beneficiary to the new group
or demonstration but must instead
maintain the beneficiary’s access to
coverage meeting the definition of MEC
during the period in which the rule
applies, except as discussed below.
For example, the state must transition
a beneficiary enrolled in the eligibility
group for children under age 19 at 42
CFR 435.118 to the adult group
described at 42 CFR 435.119 when the
beneficiary reaches age 19, provided
that the state covers this group and the
beneficiary meets the eligibility
requirements of the group. That is
because the medical assistance provided
under the eligibility group for children
under age 19 includes full state plan
benefits with no cost sharing, which
meets the definition of MEC, and the
medical assistance offered under the
adult group may include a somewhat
different set of benefits through the
state’s ABP, and may include cost
sharing for certain services, but it also
meets the definition of MEC. This
transition would therefore be
permissible under § 433.400(c)(2)(i).
In contrast, a state may not transition
a beneficiary from the eligibility group
for children under age 19 or the adult
group, both of which provide MEC, to
a limited benefit group that does not
provide MEC, such as the family
planning group at 42 CFR 435.214,
which covers only family planning and
family planning-related services. As
described further in § 433.400(c)(2)(iv),
if a beneficiary receiving tier 1 coverage
no longer meets the eligibility
requirements for the original group in
which he or she was enrolled, and the
beneficiary does not meet the
requirements for any other eligibility
groups with tier 1 coverage, the state
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must continue to provide the medical
assistance offered under the eligibility
group in which the beneficiary was
eligible on or after March 18, 2020.
At § 433.400(c)(2)(i)(B), we establish a
variation on this requirement for
beneficiaries who have coverage
meeting the definition of MEC as of or
after March 18, 2020, and whom the
state subsequently determines are
eligible for coverage under a Medicare
Savings Program eligibility group. The
Medicare Savings Program is defined at
§ 433.400(b) to include the eligibility
groups described at section
1902(a)(10)(E)(i), (iii), and (iv) of the
Act. For such beneficiaries, the state
satisfies the requirement described in
paragraph (c)(2) of this section if it
furnishes the medical assistance
available through the Medicare Savings
Program, because the coverage that
beneficiary receives under the Medicare
program qualifies as MEC. Thus, for
example, a beneficiary enrolled in the
adult group as of or after March 18,
2020, may be transitioned to a Medicare
Savings Program eligibility group, such
as the qualified Medicare beneficiaries
(QMB) group described at section
1902(a)(10)(E)(i) of the Act, when the
beneficiary reaches age 65, if the
beneficiary meets the eligibility
requirements of the QMB group. Such a
beneficiary would receive Medicaid
coverage of Medicare premiums and
Medicare-related cost sharing through
the QMB group. However, unless that
beneficiary was also eligible for another
full-benefit Medicaid eligibility group,
all of the beneficiary’s health care
services would be provided through
Medicare and the beneficiary would not
receive any other Medicaid covered
services. While the medical assistance
provided under the adult group differs
from the medical assistance provided
under the QMB group, the beneficiary
maintains access to MEC. Therefore, the
state may transition the beneficiary from
the adult group to a Medicare Savings
Program group.
The second tier of coverage, which is
described at § 433.400(c)(2)(ii), consists
of coverage that is not defined as MEC
but that is robust enough to include
access to coverage of both testing
services and treatment for COVID–19
under CMS’s interpretation of FFCRA
section 6008(b)(4). Not all Medicaid
coverage qualifies as MEC, and the nonMEC coverage provided to beneficiaries
can vary greatly. As noted previously,
some beneficiaries’ coverage is limited
by statute or existing section 1115
demonstration authority to a very
narrow range of services that would not
include COVID–19 testing or treatment
services, and CMS has not interpreted
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section 6008(b)(4) of the FFCRA to
require states to cover COVID–19 testing
and treatment services for those
beneficiaries. However, other Medicaid
beneficiaries receive a relatively robust
set of benefits, such as pregnancyrelated services described in the matter
following section 1902(a)(10)(G) of the
Act, which would include testing
services and treatment for COVID–19,
including vaccines, specialized
equipment, and therapies, during the
period when FFCRA section 6008(b)(4)
applies in a state, but which does not
qualify as MEC in all states.
Section 433.400(c)(2)(ii) of this IFC
provides that states must continue to
provide Medicaid coverage that
includes coverage of COVID–19 testing
services and treatments, including
vaccines, specialized equipment, and
therapies, to beneficiaries who had
access to coverage in tier 2 as of or after
March 18, 2020. Thus, states must
transition beneficiaries who lose
eligibility for tier 2 coverage but gain
access to MEC coverage in tier 1 or to
other coverage in tier 2 to the new
eligibility group or demonstration, but
they may not transition such
beneficiaries to coverage that does not
include access to testing services and
treatment for COVID–19. This
interpretation is consistent with the
requirement for states claiming the
temporary FMAP increase to provide
coverage for testing services and
treatments for COVID–19, as described
at section 6008(b)(4), and with CMS’s
interpretation of that requirement.
Consistent with § 433.400(c)(2)(ii), a
state must transition a beneficiary from
tier 2 coverage to tier 1 coverage if that
beneficiary becomes eligible for
coverage that qualifies as MEC. For
example, a state must transition a
woman receiving tier 2 postpartum
coverage under the pregnant women
group described at 42 CFR 435.116 (in
a state in which such coverage is not
considered MEC) to the adult group
described at 42 CFR 435.119 at the end
of the postpartum period, because
coverage under the adult group qualifies
as MEC and is therefore included in tier
1. If this postpartum beneficiary was not
eligible for any eligibility groups with
tier 1 coverage, such as in a state that
does not cover the adult group, but was
eligible for tier 2 coverage, such as
through a limited benefit section 1115
demonstration providing non-MEC
coverage that includes access to testing
services and treatment for COVID–19,
the state must move her to that
coverage. If such a beneficiary is not
eligible for any other tier 1 or tier 2
coverage, the state must continue to
provide the medical assistance available
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through the pregnant women group
until the end of the month in which the
PHE for COVID–19 ends, in order to
qualify for the temporary FMAP
increase, as described at
§ 433.400(c)(2)(iv). For example, a
woman receiving non-MEC pregnancy
related coverage that includes coverage
of testing services and treatments for
COVID–19 could not be transitioned to
coverage of only family planning
services at the end of the postpartum
period.
The third tier, described at
§ 433.400(c)(2)(iii), includes coverage
that is not MEC and that also does not
cover testing services and treatment for
COVID–19, including vaccines,
specialized equipment, and therapies,
under CMS’s interpretation of FFCRA
section 6008(b)(4). Coverage under tier 3
may include coverage for the eligibility
group limited to family planning
described at 42 CFR 435.214 or the
eligibility group for individuals with
tuberculosis described at 42 CFR
435.215. Coverage through an existing
family planning demonstration or other
limited benefit section 1115
demonstration may also be included in
tier 3 if it does not cover COVID–19
testing and treatment. If a beneficiary
loses eligibility for coverage meeting the
tier 3 description during the period in
which the FFCRA section 6008(b)(3)
requirement applies, and the beneficiary
gains eligibility for a group that
provides coverage in tier 1 or tier 2,
then, under § 433.400(c)(2)(iii), the state
must transfer the beneficiary into that
new eligibility group as coverage in
those tiers is more robust than coverage
in tier 3.
The coverage in tier 3 differs from the
coverage in tier 1, which is always
considered MEC and the coverage in tier
2, which always includes testing
services and treatment for COVID–19.
The coverage available to a beneficiary
in tier 3 is more limited and may vary
widely from one group or demonstration
to the next. Coverage limited to family
planning and family planning-related
services is significantly different from
coverage in a limited-benefit section
1115 demonstration that focuses, for
example, on preventing the progression
of a specific disease. Therefore, the
requirement in § 433.400(c)(2)(iii) for
tier 3 coverage differs somewhat from
the requirements in § 433.400(c)(2)(i)
and (ii) for tiers 1 and 2. If a beneficiary
becomes ineligible for the tier 3
eligibility group or demonstration in
which he or she is enrolled and
becomes eligible for another eligibility
group or demonstration with coverage
that is also within tier 3, the state must
continue to provide the coverage
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available through the eligibility group or
demonstration for which the beneficiary
was eligible as of or after March 18,
2020, unless the beneficiary requests a
voluntary termination to transition to
the new eligibility group or
demonstration, as discussed below.
Transitioning a beneficiary from one
eligibility group offering tier 3 coverage
to another eligibility group offering tier
3 coverage would not satisfy the
requirement in § 433.400(c)(2)(iii).
We note that beneficiaries enrolled in
certain limited-benefit state plan
eligibility groups may be eligible for
coverage in the optional COVID–19
testing group authorized under section
1902(a)(10)(A)(ii)(XXIII), and such
individuals can be enrolled in both
limited benefit groups. Section 3716 of
the CARES Act amended section
1902(ss) of the Act to establish that
individuals eligible for certain optional
eligibility groups, such as the eligibility
group limited to family planning and
related services described at
1902(a)(10)(A)(ii)(XXI) of the Act, are
considered ‘‘uninsured’’ for purposes of
eligibility under the optional COVID–19
testing group and therefore may obtain
COVID–19 testing coverage under that
group in addition to coverage under the
other optional eligibility group.
In addition, beneficiaries in each
benefit tier retain the right to request a
voluntary transition to a different
eligibility group (provided that they
meet the applicable eligibility
requirements), even if such transition
results in a change in the individual’s
benefit package that would not
otherwise satisfy the conditions of this
rule, such as a transition from an
eligibility group with coverage in tier 1
to an eligibility group with coverage in
tier 3 or a transition from one tier 3
group to another tier 3 group. Such a
transition is permissible under the
exception at § 433.400(d)(1)(i), as
described at § 433.400(d)(3)(i), in which
a beneficiary may request a voluntary
termination of eligibility, and would not
impact the state’s ability to claim the
temporary FMAP increase.
Section 42 CFR 430.400(c)(2)(iv)
specifies that for any beneficiary who is
validly enrolled and receiving medical
assistance on or after March 18, 2020,
and who is determined ineligible for
Medicaid prior to the last day of the
month in which the PHE for COVID–19
ends, except as provided in paragraph
(d), a state meets the requirements of
§ 430.400(c)(2)(i), (ii), or (iii) by
continuing the provide the same
coverage that the individual would have
received absent the determination of
ineligibility. For example, if a
beneficiary is enrolled in the age and
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disability-related poverty level group
described at section
1902(a)(10)(A)(ii)(X) of the Act, and the
beneficiary reports a change in
resources that would result in
ineligibility for this group, if the
beneficiary is not eligible for coverage in
any other Medicaid eligibility group, the
state would continue to provide that
individual with the coverage available
to beneficiaries enrolled in the age and
disability-related poverty level group.
The requirement at § 430.400(c)(2)(iv)
also applies in cases where a state finds
a beneficiary ineligible on a procedural
basis, such as a failure to respond to a
request for additional information, with
an exception related to residency
described at § 430.400(d)(3). For
example, if a state receives information
from quarterly wage data, which
indicates that a child’s household
income exceeds the income standard for
the eligibility group for children under
age 19 (described at 42 CFR 435.118),
the child is not eligible on another basis,
and the beneficiary’s family does not
respond to a request from the state for
additional information, the child may be
determined ineligible on a procedural
basis. In this case, through the end of
the month in which the PHE for
COVID–19 ends, the state would
continue to provide the child with the
same coverage provided to beneficiaries
enrolled in the eligibility group for
children under age 19. If the beneficiary
is subsequently determined eligible for
a different eligibility group that
provides the same tier of coverage, in
this case tier 1, the state would transfer
the beneficiary to the new eligibility
group.
CMS is available for technical
assistance to help states ensure that all
beneficiaries retain coverage in either
the same tier or in a more robust tier of
coverage when their eligibility changes
in a manner that would ordinarily result
in a transition between eligibility
groups.
6. Changes to Benefits, Cost Sharing,
and PETI
Section 433.400 of this IFC allows
states, during the period when section
6008(b)(3) of the FFCRA applies, to
move a beneficiary from one eligibility
group to another when the beneficiary
becomes ineligible for one group and
eligible for another group, as long as the
coverage provided under the new group
is within the same tier of coverage
(applicable to tier 1 and tier 2 coverage
only) or a beneficiary may also be
moved to a more generous tier of
coverage than the coverage available to
the beneficiary on or after March 18,
2020. Section 433.400(c)(3) specifies
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Frm 00026
Fmt 4701
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that states may make programmatic
changes to coverage, cost sharing, and
beneficiary liability without violating
the requirements for receiving the
temporary FMAP increase, provided
that such changes do not violate the
individual beneficiary protections at
§ 433.400(c)(2) or the requirements
under section 6008(b)(4) of the FFCRA
to cover COVID–19 testing and
treatment services without cost-sharing.
As described at § 433.400(c)(3), states
may generally make changes to benefits
offered under the state plan (as allowed
under relevant provisions of the Act) or
a section 1115 demonstration. For
example, section 6008(b)(3) of the
FFCRA does not prohibit a state from
eliminating an optional benefit from its
state plan. Therefore, a state could
eliminate dental services for individuals
age 21 and above, and still comply with
section 6008(b)(3) of the FFCRA. Note
that under section 1905(r)(5) of the Act,
as part of the mandatory EPSDT benefit,
states must provide beneficiaries under
age 21 with all necessary health care,
diagnostic services, treatment, and other
measures described in section 1905(a) of
the Act, to correct or ameliorate defects
and physical and mental illnesses and
conditions discovered by EPSDT
screening services, whether or not such
services are covered under the state
plan. However, states need not maintain
EPSDT benefits for beneficiaries who
turn 21 in order to comply with the
terms of section 6008(b)(3) of the
FFCRA.
Additionally, states are permitted to
change the scope of benefits provided to
beneficiaries without violating the
requirements of section 6008(b)(3) for
claiming the temporary FMAP increase,
as long as they comply with otherwise
applicable Medicaid law, including
section 6008(b)(4) of the FFCRA. For
example, section 6008(b)(3) of the
FFCRA does not prohibit states from
applying service authorization criteria,
including for services authorized under
section 1915(c) of the Act, in
determining the amount, duration, or
scope of coverage a beneficiary is
entitled to receive under the state’s
program. Section 440.230(b) still applies
as a limit on state flexibility. That
regulation requires that each Medicaid
service must be sufficient in amount,
duration, and scope to reasonably
achieve its purpose.
In considering optional changes to
coverage, states may wish to avoid
service authorization changes that lead
to more individuals being placed in
institutional or congregate settings, as
these settings have had a
disproportionate share of COVID–19
cases and deaths. We also note that
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regardless of the flexibility provided at
§ 433.400(c)(3), states retain their
obligations to provide services and
supports in the ‘‘most integrated
setting’’ under the integration mandate
of Title II of the Americans with
Disabilities Act (ADA), as interpreted by
the Supreme Court in Olmstead v. L.C.,
527 U.S. 581 (1999) (hereafter
‘‘Olmstead’’),39 to avoid unjustified
institutionalization or segregation. If the
elimination of an optional benefit
results in or places an individual with
a disability at risk of unjustified
institutionalization or segregation, it
may be a violation of the state’s
obligations under the ADA and
Olmstead.40 States’ Olmstead
obligations do not confer Medicaid
authority or create Medicaid obligations
where they do not otherwise exist; states
may choose to (and in some cases would
be required to) use funds outside of or
in addition to Medicaid to comply with
Olmstead responsibilities.
Finally, states may generally establish
or increase cost sharing (consistent with
sections 1916 and 1916A of the Act,
implementing regulations at 42 CFR
447.50 through 447.90, and the state
plan), and increase beneficiary
obligations under the PETI rules, and
still comply with FFCRA section
6008(b)(3). However, states should also
comply with FFCRA 6008(b)(4) if they
are claiming the temporary FMAP
increase. For example, a state may
increase the liability of individuals
receiving Medicaid coverage for
institutional services under the state
plan through otherwise permissible
reductions in their standard personal
needs allowances or family allowances.
In addition, they may transfer a
beneficiary from one program furnishing
HCBS (for example, a waiver program
authorized under section 1915(c) of the
Act) to another as a beneficiary’s health
status and level of care changes.
Prior to reducing benefits or
increasing cost sharing or beneficiary
liability a state must provide proper
advance notice and comply with other
applicable statutory and regulatory
requirements. In particular, the advance
notice requirements that apply under 42
39 Under title II of the ADA and Olmstead, the
unjustified isolation of individuals with disabilities
constitutes unlawful discrimination. States are
required to provide community-based treatment
where such treatment would be appropriate, the
affected person does not oppose such treatment,
and the treatment can be reasonably
accommodated.
40 See DOJ’s Statement of the Department of
Justice on Enforcement of the Integration Mandate
of Title II of the Americans with Disabilities Act
and Olmstead v. L.C., Question 9, updated February
25, 2020, available at: https://www.ada.gov/
olmstead/q&a_olmstead.htm.
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CFR 431.211 preclude states from
reducing benefits or increasing cost
sharing or beneficiary liability
retroactively. Additionally, 42 CFR
440.230(b) limits states’ flexibility to
reduce the amount, duration, or scope of
benefits; that regulation requires that
each Medicaid service must be
sufficient in amount, duration, and
scope to reasonably achieve its purpose.
7. Exceptions to Maintaining Enrollment
Section 433.400(d) of this IFC
describes the exceptions to the
continuous enrollment requirement in
§ 433.400(c)(2). Section 6008(b)(3) of the
FFCRA specifies that a beneficiary’s
Medicaid enrollment may be terminated
if the beneficiary requests a voluntary
termination of eligibility or the
beneficiary is no longer a resident of the
state. These exceptions are described in
§ 433.400(d)(1)(i) and (ii). Because a
beneficiary who dies is no longer a state
resident, § 433.400(d)(1)(iii) also
provides an exception for deceased
beneficiaries.
Section 433.400(d)(2) provides that
states that have elected the option under
section 1903(v)(4) of the Act to provide
coverage to certain lawfully residing
children and/or pregnant women, must
limit the provision of services for these
beneficiaries to services necessary for
treatment of an emergency medical
condition, as defined in section
1903(v)(3) of the Act, when they no
longer meet the criteria at section
1903(v)(4) of the Act. This is because
section 1903(v) of the Act prohibits the
provision of FFP for otherwise eligible
non-citizens who are not in a
satisfactory immigration status, except
as provided under paragraphs (2)
(authorizing FFP for services necessary
to treat an emergency medical
condition) and (4) (relating to coverage
of certain lawfully residing children
and/or pregnant women) of section
1903(v) of the Act.
Finally, § 433.400(d)(3) clarifies the
exceptions at § 433.400(d)(1). As noted
above, § 433.400(d)(1)(i) provides an
exception for beneficiaries who request
a voluntary termination. Section
433.400(d)(3)(i) provides that this
exception applies not only to
beneficiaries who request that their
Medicaid coverage be terminated in its
entirety, but also to beneficiaries who
request a voluntary transition to a
different eligibility group (provided that
they meet the applicable eligibility
requirements), even if such transition
results in a change in the individual’s
benefit package that would not
otherwise satisfy the conditions of
§ 433.400(c)(2). For example, a state may
transition a beneficiary from an
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71167
eligibility group with coverage in tier 1
to an eligibility group with coverage in
tier 3, at the beneficiary’s request. Such
a transition would not impact the state’s
ability to claim the temporary FMAP
increase because the change resulted
from a beneficiary request for voluntary
termination from the original eligibility
group.
Additionally, as described at
§ 433.400(d)(3)(ii), individuals who are
identified as receiving benefits in more
than one state via a data match with the
Public Assistance Reporting Information
System (PARIS) interstate matching
service in accordance with § 435.945(d)
and who fail to respond to a request for
information to verify their residency in
the reasonable period permitted by the
state, consistent with § 435.952(c)(2)(iii),
are generally considered to no longer be
residents of the state for purposes of
section 6008(b)(3) of the FFCRA,
provided that the state takes all
available reasonable measures to
determine state residency prior to
termination. These measures include,
but are not limited to, reviewing
existing information in the beneficiary’s
record to validate state residency,
checking available state electronic data
sources such as the Department of
Motor Vehicles records or other state
benefit programs, and coordinating with
agencies in the other state(s) in which
the PARIS interstate match identified
the beneficiary as receiving benefits to
determine the state in which the
individual is a resident for purposes of
Medicaid eligibility. If the state is
unable to verify the beneficiary’s
continued residency in the state because
the beneficiary fails to respond to
requests for additional information and
the state’s alternative efforts cannot
verify the beneficiary’s continued
residency in the state through other
sources, that beneficiary’s Medicaid
enrollment may be terminated in
accordance with § 435.400(d)(1)(ii).
Such an individual will be considered
a non-resident for purposes of section
6008(b)(3) of the FFCRA until such time
as the state has information verifying
residency. If, after termination, the state
obtains information that verifies
residency, the state must reinstate the
individual’s eligibility back to the date
of termination.
G. Updates to the Comprehensive Care
for Joint Replacement (CJR) Model,
Performance Year (PY) 5 During the
COVID–19 Public Health Emergency
(PHE)
1. Background
Under the authority of section 1115A
of the Act, through notice-and-comment
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rulemaking, the Innovation Center
established the CJR model in a final rule
titled ‘‘Medicare Program;
Comprehensive Care for Joint
Replacement Payment Model for Acute
Care Hospitals Furnishing Lower
Extremity Joint Replacement Services’’
published in the November 24, 2015
Federal Register (80 FR 73274) (referred
to as the ‘‘November 2015 final rule’’).
The CJR model, which was
implemented on April 1, 2016, aims to
support better and more efficient care
for beneficiaries undergoing the most
common inpatient surgeries for
Medicare beneficiaries: Hip and knee
replacements (also called lower
extremity joint replacements or LEJR).
This model tests bundled payment and
quality measurement for an episode of
care associated with hip and knee
replacements to encourage hospitals,
physicians, and post-acute care
providers to work together to improve
the quality and coordination of care
from the initial hospitalization through
recovery. All related care covered by
Medicare Parts A and B within 90 days
of hospital discharge from the LEJR
procedure is included in the episode of
care. During the first CJR model
performance period, the CJR model
required hospitals located in the 67
MSAs selected participation to
participate in the model through
December 31, 2020 unless the hospital
was an episode initiator for an LEJR
episode in the risk-bearing phase of
Models 2 or 4 of the Bundled Payments
for Care Improvement (BPCI) initiative.
Hospitals located in one of the 67 MSAs
that participated in Model 1 of the BPCI
initiative, which ended on December 31,
2016, were required to begin
participating in the CJR model when
their participation in the BPCI model
ended.
In the December 1, 2017 Federal
Register, we published another final
rule (82 FR 57066), titled ‘‘Medicare
Program; Cancellation of Advancing
Care Coordination Through Episode
Payment and Cardiac Rehabilitation
Incentive Payment Models; Changes to
Comprehensive Care for Joint
Replacement Payment Model: Extreme
and Uncontrollable Circumstances
Policy for the Comprehensive Care for
Joint Replacement Payment Model’’
(referred to as the ‘‘December 2017 final
rule’’), that implemented revisions to
the CJR model, including giving rural
and low volume hospitals selected for
participation in the CJR model as well
as those hospitals located in 33 of the
67 metropolitan statistical areas
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(MSAs) 41 a one-time option to choose
whether to continue their participation
in the model through December 31,
2020 (that is, continue their
participation through PY5). An interim
final rule with comment period was also
issued in conjunction with the
December 2017 final rule (82 FR 57092)
in order to address the need for a policy
to provide some flexibility in the
determination of episode costs for
providers located in areas impacted by
extreme and uncontrollable
circumstances. This extreme and
uncontrollable circumstances policy
was adopted as final in the final rule (83
FR 26604) we published in the June 8,
2018 Federal Register, titled ‘‘Medicare
Program; Changes to the Comprehensive
Care for Joint Replacement Payment
Model (CJR): Extreme and
Uncontrollable Circumstances Policy for
the CJR Model.’’
In the February 24, 2020 Federal
Register (85 FR 10516), we published
the proposed rule titled ‘‘Medicare
Program: Comprehensive Care for Joint
Replacement Model Three-Year
Extension and Changes to Episode
Definition and Pricing’’ (hereinafter
referred to as the ‘‘February 2020
proposed rule’’). Among other changes,
this proposed rule proposed to add
three additional performance years to
the CJR model (i.e., performance years 6
through 8).
In the April 6, 2020 Federal Register
(85 FR 19230), we published an interim
final rule with comment period (IFC)
titled ‘‘Medicare and Medicaid
Programs; Policy and Regulatory
Revisions in Response to the COVID–19
Public Health Emergency’’ (hereinafter
referred to as the ‘‘April 2020 IFC’’). In
the April 2020 IFC, to account for the
impact of the PHE for COVID–19 on CJR
participant hospitals, we extended PY5
through March 31, 2021, and adjusted
the extreme and uncontrollable
circumstances policy to account for
COVID–19 by specifying that all
episodes with a date of admission to the
anchor hospitalization that is on or
within 30 days before the date that the
emergency period (as defined in section
1135(g) of the Act) begins or that occurs
through the termination of the
emergency period (as described in
section 1135(e) of the Act), actual
episode payments are capped at the
41 Metropolitan Statistical Area (MSA) means a
core-based statistical area associated with at least
one urbanized area that has a population of at least
50,000. MSAs included in the CJR model are
available in the December 2017 final rule available
at https://www.federalregister.gov/documents/2017/
12/01/2017-25979/medicare-program-cancellationof-advancing-care-coordination-through-episodepayment-and-cardiac.
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target price determined for that episode
under § 510.300.
Additionally, in the May 29, 2020
Federal Register (85 FR 32460), CMS
published a proposed rule titled
‘‘Medicare Program; Hospital Inpatient
Prospective Payment Systems for Acute
Care Hospitals and the Long-Term Care
Hospital Prospective Payment System
and Proposed Policy Changes and Fiscal
Year 2021 Rates; Quality Reporting and
Medicare and Medicaid Promotion
Interoperability Programs Requirements
for Eligible Hospitals and Critical
Access Hospitals: (hereinafter referred
to as the FY 2021 IPPS/LTCH proposed
rule). In the FY 2021 IPPS/LTCH
proposed rule (85 FR 32510), we
solicited comment on the effect of the
proposal to create new MS–DRG 521
and MS–DRG 522, the effect this
proposal would have on the CJR model
and whether to incorporate MS–DRG
521 and MS–DRG 522, if finalized, into
the CJR model’s proposed extension to
December 31, 2023.
Through this IFC we are
implementing four changes to the CJR
model. These are: (1) Extending
performance year 5 an additional 6
months to provide for continuity of
model operations with the same scope
while we continue to consider
comments received on our proposal to
extend the model to performance years
6 through 8 and adopt other changes to
the model; (2) making changes to the
reconciliation process for PY5 to allow
for two periods and to enable more
frequent receipt of reconciliation reports
by participants; (3) making a technical
change, retroactive to October 1, 2020,
to ensure that the model continues to
include the same inpatient Lower
Extremity Joint Replacement (LEJR)
procedures, despite the adoption of new
MS–DRGs to describe those procedures;
and (4) making changes to the extreme
and uncontrollable circumstances
policy for COVID–19 to adapt to an
increase in CJR episode volume and
renewal of the PHE, while providing
protection against financial
consequences of COVID–19 after the
extreme and uncontrollable
circumstances policy no longer applies.
2. Extension of Performance Year 5 to
September 30, 2021
We are implementing a 6-month
extension to CJR performance year (PY)
5 such that the model will now end on
September 30, 2021. In the February
2020 proposed rule, we proposed to
extend the CJR model by adding three
performance years (PY6 through 8),
from January 1, 2021 to December 31,
2023, to revise target prices, to change
the definition of an episode of care to
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include outpatient procedures for Total
Knee Arthroplasty and Total Hip
Arthroplasty, as well as to revise other
sections of 42 CFR part 510.42 In
response to the PHE for COVID–19, in
the April 2020 IFC we extended PY 5 an
additional 3 months to end on March
31, 2021 rather than on December 31,
2020 as finalized in November 2015
final rule.
While we continue to consider the
addition of performance years to the
model and other changes proposed in
the February 2020 proposed rule, we
also do not want to create a disruption
to the model by allowing the model to
end on March 31, 2021, which could be
disruptive to hospitals and patient care
during the PHE if it is still ongoing at
that time. Implementing an additional
six months of PY5, so that PY5 now
ends on September 30, 2021, provides
participant hospitals additional relief
and stability in model operations. In the
event the three-year extension is
finalized, participant hospitals would be
in a worse position if PY 5 was not
extended to September 30, 2021 because
participant hospitals would have made
operational choices in reliance on the
model ending on March 31, 2021 and
then have to adjust to model changes on
top of the significant burden of
managing COVID–19 treatment and
under COVID–19 safety protocols and
utilization changes. Overall, this means
a nine-month extension from the
original conclusion of the model as
finalized in the November 2015 final
rule (80 FR 73274), which had
established that the model would end
on December 31, 2020 with no new
episodes initiating after October 4, 2020.
We received several comments on the
April 2020 IFC supporting the policy to
extend PY5 an additional three months
71169
and asking that we extend PY5 by 12
months instead, not just the 3 months in
the April 2020 IFC. In addition,
commenters noted that though state and
local guidelines have laid out a process
for regions and facilities to determine
when to re-open elective procedures,
the progression of COVID–19 could
impact elective procedures well into
2021. We appreciate commenters’
request to extend PY 5 by 12 additional
months because of the impact COVID–
19 has had on LEJR procedures. We
observe that COVID–19 has had an
impact on CJR procedures from
February 2020 to August 2020. Table 1
depicts recent Medicare claims data
comparing February to August of 2019
and February to August of 2020. These
numbers reflect episode volume for each
month, accounting for any CJR episode
that began within that month.
TABLE 1—CJR EPISODE VOLUME COMPARISON
February
2019
2020
March
6214
5245
April
6174
3374
May
6515
876
June
6019
2242
In light of these data, we believe
providing an additional 6 months
beyond what we adopted in the April
2020 IFC provides participant hospitals
relief from COVID–19 challenges.
Therefore, we are implementing an
additional 6-month extension of CJR PY
5 and amending the provisions at 42
CFR 510.2 and 510.200(a) to reflect this
extension.
We note that in our February 2020
proposed rule to extend and modify the
CJR model through PYs 6 to 8 (CMS–
5529–P), we proposed PY 6 would
comprise all CJR episodes ending on or
after January 1, 2021 and on or before
December 31, 2021. However, since we
are amending PY 5 such that it
comprises all CJR episodes ending on or
after January 1, 2020 and on or before
September 30, 2021, we seek comment
on the duration of PY 6, if finalized. In
particular, we seek comment on the
potential for PYs 6 through 8 to remain
12-month performance years and each
begin with episodes ending on or after
October 1 each year. We also seek
comment on increasing the duration of
proposed PY 6 to 15 months. Under this
alternative, PY 6 would comprise all
CJR episodes ending on or after October
1, 2021 and on or before December 31,
2022; PY 7 and PY 8 would remain 12
months and each begin with episodes
ending on or after January 1, 2023 or
January 1, 2024, respectively.
42 For proposed changes to the CJR Model in
‘‘Medicare Program: Comprehensive Care for Joint
Replacement Model Three Year Extension and
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3. Additional Reconciliations for
Performance Year 5
Currently, following the end of each
performance year, CMS determines
actual episode payments and calculates
the amount of a reconciliation payment
or repayment amount, as described in
42 CFR 510.305. Each performance year
is reconciled twice. The first
reconciliation calculation process
begins after a 2-month period of claims
runout, while the final reconciliation
calculation process begins after a 14month period of claims runout. The
initial reconciliation of a given
performance year is conducted
concurrently with the final
reconciliation of the previous
performance year, and the resulting
amounts are netted against one another
for one annual reconciliation payment
or repayment amount, as set forth in 42
CFR 510.305. The initial reconciliation
process typically begins in late February
of the calendar year following the
performance year, with reports and
reconciliation amounts issued in June.
Final reconciliation for the performance
year is issued the following June.
Absent modification to the
reconciliation process, the extension of
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5836
4036
August
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3838
5838
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PY 5 to a total of 21 months, from
January 1, 2020 through September 30,
2021 would mean that participant
hospitals would experience a 21-month
gap between the PY4 final reconciliation
in June of 2020 and initial PY 5
reconciliation in early 2022. We believe
this significant gap is problematic
because participant hospitals gain
important feedback from their annual
reconciliation reports that they can use
to gauge their quality performance and
efforts at cost-savings. These annual
reports also facilitate the relationships
that participant hospitals have
established with clinicians and other
entities with whom they coordinate care
and/or have gainsharing arrangements.
Further, not having an initial
reconciliation for PY5 until early 2022
is not consistent with the model design
goal of reconciling one time a year and
netting against final reconciliation
amounts from the prior year. Therefore,
we believe there is good cause to
conduct two initial, and two final,
reconciliations of PY5. The first initial
reconciliation will apply to the first 12
months of PY5 in order to maintain
consistency with the 12 month
reconciliation cycles for previous PYs
2–4 (we note that PY 1 was 9 months
rather than 12 months), and the second
initial reconciliation will apply to the
Changes to Episode Definition and Pricing’’ See 85
FR 10516.
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remaining 9 months of PY5. To
minimize confusion, we will refer to
these two subsets of PY5 as performance
year subset 5.1and 5.2, respectively.
The initial reconciliation of
performance year subset 5.1 will occur
fourteen months after the start of PY5,
which is the same timeline as would
have occurred PY5 under the December
2017 final rule. After the usual 2-month
period of claims runout, the initial
reconciliation for performance year
subset 5.1 episodes will begin in late
February of 2021 using 12 months of
claims from CY 2020 to calculate
reconciliation payments, with the
resulting amounts netted against the
results of the concurrent PY4 final
reconciliation calculation when we
issue reports and reconciliation
amounts to participants in June 2021.
Participants can expect to receive their
2021 reconciliation reports on
approximately the same schedule as in
previous model years.
The nine additional months of PY 5
(performance year subset 5.2) will be
reconciled one full calendar year after
the reconciliation of PY 4 final/
performance year subset 5.1 initial. We
will use claims data for the initial
reconciliation of performance year
subset 5.2 that reflect a 2-month period
of claims runout (as set forth in 42 CFR
510.305(e)(1)(i)), as we have for PY 1–
4 and performance year subset 5.1. In
short, performance year subset 5.2 will
run from January 1, 2021 through
September 30, 2021. Consistent with
using two months of claims run out, we
will pull claims for the initial
reconciliation in December 2021.
However, we will not reconcile
performance year subset 5.2 until late
February 2022 along with the final
reconciliation for performance year
subset 5.1. This means that we will not
begin reconciliation calculation for
performance year subset 5.2 until five
months after the end of performance
year subset 5.2 in order to align the
initial reconciliation calculation for
performance year subset 5.2 with the
timing of the subsequent reconciliation
calculation for performance year subset
5.1. While alignment with the
performance year subset 5.1 subsequent
reconciliation calculation is the primary
reason for this delay in the performance
year subset 5.2 initial reconciliation, it
is also necessary to allow time to receive
certain input files to perform the initial
reconciliation calculation, including
standardized claims files and quality
data. These data are generally not
available more than a few weeks prior
to the usual reconciliation process start
date in late February. Therefore, the
reconciliation process will occur on the
same schedule as PY 1 through 4 and
performance year subset 5.1, with the
reconciliation report available one year
after the reports from the previous year’s
reconciliation.
We note that, as part of the separate
reconciliation calculation processes for
performance year subsets 5.1 and 5.2,
we will calculate a separate Composite
Quality Score (CQS) for each of
performance year subsets 5.1 and 5.2,
including a separate set of quality
improvement points and quality
performance points for each
performance year subset. In order to
conduct separate CQS calculations for
each time period, we are amending 42
CFR 510.400 to indicate that the
required data submissions that
previously applied to PY 5 will now
apply to performance year subset 5.1,
and we are adding a required data
submission for performance year subset
5.2. These additional requirements will
reflect the timeframe of performance
year subset 5.2, but will otherwise
parallel the requirements for
performance year subset 5.1, and will
not require an increased amount of data
for performance year subset 5.2 as
compared to performance year subset
5.1. We recognize that some of the
timeframe for both performance year
subsets 5.1 and 5.2 quality data
collection overlap with the effective
dates of the COVID–19 waiver 43 that
provided reporting exemptions for
hospitals participating in quality
reporting programs, so we will use
quality data reported before and after
the effective dates of the COVID–19
waiver, for those quality measures to
which the waiver applied.
The final reconciliation calculation
for performance year subset 5.2 will
occur one year after the initial
reconciliation of performance year
subset 5.2. Although we will use claims
data that were available 14 months after
the end of performance year subset 5.2
for the subsequent reconciliation (as set
forth in 42 CFR 510.305(i)(1)), as with
the initial reconciliation, we will not
begin the subsequent reconciliation
calculation process until 17 months
after the end of performance year subset
5.2. We would begin the final
reconciliation calculation for
performance year subset 5.2 in late
February 2023 with reconciliation
payment amounts and reports issued in
June, because input files that are
required for the final reconciliation will
not be available until 17 months after
the end of performance year subset 5.2.
In particular, we need to receive the
reconciliation results from Accountable
Care Organizations (ACOs) that overlap
with CJR in order to conduct the ACO
overlap calculation. Since we cannot
state with confidence that we will have
access to those data prior to the normal
reconciliation process start date in late
February 2023, we will perform the
reconciliation calculation at the same
time of year that we have performed
previous reconciliations. As noted
above, we will conduct the final
reconciliation of performance year
subset 5.2 independently. Table 2
illustrates the timelines for performance
year subsets 5.1 and 5.2.
TABLE 2—TIMELINES FOR PERFORMANCE YEARS 4 AND 5
Performance
year
(PY)
Initial
reconciliation
calculation start
Performance
period
4 .........................................
01/01/2019 to 12/31/2019
5 (two periods) ..................
Subset 5.1 .........................
01/01/2020 to 09/30/2021.
01/01/2020 to 12/31/2021
Subsequent
reconciliation
calculation start
2 months after 12/31/2019:
Late February 2020.
14 months after 12/31/
2019: Late February
2021.
Net PY3 and PY4 reconciliation amounts.
2 months after 12/31/2020:
Late February 2021.
14 months after 12/31/
2020: Late February
2022.
Net PY4 and PY5.1 reconciliation amounts.
43 https://www.cms.gov/files/document/covid-ifc3-8-25-20.pdf.
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71171
TABLE 2—TIMELINES FOR PERFORMANCE YEARS 4 AND 5—Continued
Performance
year
(PY)
Subset 5.2 .........................
01/01/2021 to 09/30/2021
In order to reflect the changes in
reconciliation timing and other changes
associated with additional
reconciliations in PY5, we are amending
the following provisions: 42 CFR 510.2,
42 CFR 510.200, 42 CFR 510.305(b),
(d)(1), (e), (i)(1) and (2), and (j)(1) and
(2), and 42 CFR 510.400(b)(3)(v), and
adding 42 CFR 510.400(b)(3)(vi).
4. DRG 521 and DRG 522
In this IFC we are amending our
regulations at § 510.300(a) to specify
that, as of October 1, 2020, the CJR
model includes episodes when the MS–
DRG assigned at discharge for an anchor
hospitalization is one of two new MS–
DRGs we adopted in the FY 2021 IPPS/
LTCH final rule (85 FR 58432): MS–DRG
521 (Hip Replacement with Principal
Diagnosis of Hip Fracture with Major
Complications and Comorbidities
(MCC)) and MS–DRG 522 (Hip
Replacement with Principal Diagnosis
of Hip Fracture, without MCC). As
indicated in 42 CFR 510.300(a)(1), the
CJR model episode definition
historically included MS–DRG 469
(Major Hip and Knee Joint Replacement
or Reattachment of Lower Extremity
with MCC) and MS–DRG 470 (Major
Hip and Knee Joint Replacement or
Reattachment of Lower Extremity
without MCC). For purposes of
calculating quality adjusted target
prices, we further subdivided episodes
within each MS–DRG based on the
presence or absence of a primary hip
fracture. In the FY 2021 IPPS/LTCH
final rule, we stated that because the
CJR model would continue until at least
March 31, 2021, we intended to adopt
a policy in the CJR final rule that
incorporates these new MS–DRGs into
the CJR model as of October 1, 2020 to
avoid disruption to the model for the
remainder of PY5 (as extended) and
thereafter, if our proposal to extend the
CJR model through PY8 were finalized
(85 FR 58502). To this end, we are
adopting the change in this IFC, with
retroactive effect to October 1, 2020.
This change ensures that hip
replacements with a principal diagnosis
of hip fracture, with and without MCC,
will continue to trigger CJR model
episodes even though they are now
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Subsequent
reconciliation
calculation start
5 months after 09/30/2021:
Late February 2022.
17 months after 09/30/
2021: Late February
2023.
assigned to these new DRGs rather than
MS–DRGs 469 and 470.
As background, in the FY 2021 IPPS/
LTCH proposed rule (85 FR 32510),
CMS proposed the creation of two new
MS–DRGs, 521 and 522 (Hip
Replacement with primary hip fracture,
with and without major complications
and comorbidities, respectively).
Because the FY2021 IPPS/LTCH
proposed rule was published after the
CJR February 2020 proposed rule, the
new MS–DRGs 521 and 522 were not
addressed in the February 2020
proposed rule. We solicited comment in
the FY2021 IPPS/LTCH proposed rule
on the effect this proposal would have
on the CJR model and whether to
incorporate MS–DRG 521 and MS–DRG
522, if finalized, into the CJR model’s
proposed extension to December 31,
2023. The public also had the
opportunity to address this issue in
comments responding to the CJR
February 2020 proposed rule, as the
comment period for that rule had been
extended.
We received three comments in
response to the February 2020 proposed
rule and 20 comments in response to the
FY2021 IPPS/LTCH proposed rule
addressing the effects of the proposed
new MS–DRGs on the CJR model. Most
commenters agreed that MS–DRGs 521
and 522 should be included in the
definition of a CJR model episode,
noting their assumption that this would
have a neutral economic impact on the
model and participants, as the CJR
model already provides for separate
quality adjusted target prices for hip
fracture cases for MS–DRGs 469 and
470. Multiple commenters stated their
belief that there is value in maintaining
hip fracture cases in the CJR model,
including that it is administratively
simpler and that maintaining hip
fractures in the CJR model would mean
those procedures remain subject to the
value-based care incentives of the CJR
model. Some commenters suggested that
quality adjusted target prices for
episodes previously triggered by MS–
DRG 469 and MS–DRG 470 with hip
fracture could apply to episodes
triggered by the new MS–DRGs. Others
noted that if the DRGs were added
retroactively, they would not want the
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new DRGs to retroactively impact
quality adjusted target prices.
As of October 1, 2020, MS–DRGs 521
and 522 separately identify a subset of
LEJR procedures that were previously
grouped to MS–DRGs 469 and 470, and
if the definition of a CJR model episode
is not revised to accommodate this
technical change the LEJR procedures
associated with these new codes will no
longer be part of the CJR model. This
result would be highly disruptive to the
CJR model, because it would remove a
significant number of episodes midway
through a performance year. Therefore,
we believe there is good cause for this
rulemaking to change the definition of
a CJR model episode to include MS–
DRGs 521 and 522. Indeed, it would be
contrary to the public interest to
undertake traditional notice and
comment rulemaking to adopt these
regulatory changes because they are
intended to preserve the model’s scope
in light of underlying technical changes
in the IPPS. Based on the public
comments previously described, we
believe that including DRGs 521 and
522 in the CJR episode definition is less
disruptive to participant hospitals than
the alternative, which would be to allow
hip replacements with a primary hip
fracture to drop abruptly out of the
model (or to drop out of the model until
we were able to undertake full notice
and comment rulemaking to add them
back at a later point). We believe that
failure to retroactively incorporate MS–
DRGs 521 and 522 into the CJR model
as of October 1, 2020 would be contrary
to the public interest because it would
result in approximately 20–25% of all
LEJR episodes to be dropped from the
CJR model. The categories of episodes
that would be dropped tend to be
associated with emergent surgeries,
high-costs, and complex post-acute care
needs. Dropping these episodes from the
model would create confusion, increase
administrative burden for participant
hospitals, and remove the opportunity
for participant hospitals to earn
reconciliation payments by coordinating
care for these complex, high-cost
episodes.
Operationally, this is a seamless
transition for participant hospitals,
which have continued to bill Medicare
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FFS as usual for hip replacements with
hip fractures. Beginning on October 1,
2020, the Medicare IPPS grouper began
to assign those hospitalizations to one of
the new MS–DRGs, with no billing
changes required of participant
hospitals. The new MS–DRGs will be
incorporated into the CJR episode
reconciliation data system, and will be
included in participant hospitals’
monthly data feeds going forward.
Participant hospitals were notified of
their quality adjusted target prices for
episodes beginning on October 1, 2020
for MS–DRGs 469 and 470, with and
without hip fracture. As of October 1,
2020, the quality adjusted target prices
for MS–DRGs 469 and 470 with hip
fracture will apply to episodes initiated
by the new MS–DRGs 521 and 522,
respectively, for the remainder of PY5
(including both performance year
subsets 5.1 and 5.2).
Given that the CJR model currently
provides separate quality adjusted target
prices for episodes with and without a
hip fracture, incorporating the new
DRGs would have minimal financial
impact on the model. The PY5 quality
adjusted target price calculation
methodology includes the application of
update factors (80 FR 73342–73346),
which incorporate annual changes to
each CMS payment system (for example,
IPPS, OPPS, and SNF). The update
factor is calculated and applied twice
per year, in order to incorporate both
fiscal year and calendar year payment
system updates. The MS–DRG weights
assigned to the new MS–DRGs 521 and
522 in the FY 2021 IPPS/LTCH final
rule (84 FR 42044) will be incorporated
into the IPPS update factor as part of the
calculation of the quality adjusted target
prices for episodes beginning between
October 1, 2020 and December 31, 2020.
These FY 2021 MS–DRG weights will
continue in the quality adjusted target
prices for episodes that begin between
January 1, 2021 and September 30,
2021, which will incorporate CY 2021
payment system updates. As a result,
baseline prices for hip replacements
with primary hip fracture, which would
have been assigned the MS–DRGs 469
and 470 and stratified by hip fracture
status, are comparable to those same
episodes in the performance period that
are assigned to MS–DRGs 521 and 522,
respectively. For the remainder of PY5,
we will calculate quality adjusted target
prices for episodes initiated by MS–
DRGs 521 and 522 using baseline
episodes initiated by MS–DRG 469 with
fracture and MS–DRG 470 with fracture,
respectively, but updated to include the
MS–DRG weights assigned to MS–DRGs
521 and 522 for FY 2021.
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In this IFC we are incorporating the
new MS–DRGs 521 and 522 into the CJR
model episode definition as of October
1, 2020, updating quality adjusted target
prices to reflect the applicable MS–DRG
weights, and amending the provisions at
42 CFR 510.300(a)(1)(i) and (iii) to
reflect these changes.
5. Changes to Extreme and
Uncontrollable Circumstances Policy for
the PHE for COVID–19
We are also modifying the extreme
and uncontrollable circumstances
adjustment for COVID–19 in
§ 510.300(k)(4) to expire on March 31,
2021 or the last day of the emergency
period, whichever is earlier. In addition,
we are adopting a more targeted
adjustment, which will apply after
March 31, 2021 or the last day of
emergency period (whichever is earlier),
so that financial safeguards continue to
apply for CJR episodes during which a
CJR beneficiary receives a positive
COVID–19 diagnosis.
Currently, the extreme and
uncontrollable circumstances
adjustment for COVID–19 provides
financial safeguards for participant
hospitals that have a CCN primary
address that is located in an emergency
area during an emergency period, as
those terms are defined in section
1135(g) of the Act, for which the
Secretary issued a waiver or
modification of requirements under
section 1135 of the Act on March 13,
2020, effectively applying the financial
safeguards to all participant hospitals.
These financial safeguards, wherein
actual episode payments are capped at
the target price determined for that
episode, apply to fracture or nonfracture episode with a date of
admission to the anchor hospitalization
that is on or within 30 days before the
date that the emergency period (as
defined in section 1135(g) of the Act)
begins or that occurs through the
termination of the emergency period (as
described in section 1135(e) of the Act).
In the April 2020 IFC we explained this
extreme and uncontrollable
circumstances adjustment, noting that
the previous CJR model policy for
extreme and uncontrollable
circumstances was not applicable to the
PHE for the COVID–19 pandemic. We
also indicated that we did not expect
many new CJR episodes to initiate in
light of the COVID–19 virus and the
related guidance to avoid elective
surgeries. We further stated that we
wanted to avoid inadvertently creating
incentives to place cost considerations
above patient safety within the CJR
model, given the challenges to the
health care delivery system in
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responding to COVID–19 cases and the
expenses associated with treating the
virus.
We received comments on both the
April 2020 IFC and the CJR February
2020 proposed rule about the extreme
and uncontrollable circumstances
adjustment. Commenters favored the
extreme and uncontrollable
circumstances policy for COVID–19 and
commended CMS for providing relief to
participant hospitals. Some commenters
questioned what steps CMS would take
once the PHE ends and noted the
uncertainty in the current policy since
there is not a concrete end date for the
PHE. A commenter recommended CMS
hold participant hospitals harmless
from performance-related penalties for
the 2020 performance year and urged
CMS to make appropriate adjustments
for the 2020 and 2021 performance
years and to address the impact of
COVID–19 on financial expenditures,
performance scores and risk adjustment.
We appreciate commenters’ positive
feedback on the April 2020 IFC and our
decision to provide relief to participant
hospitals. At the onset on the PHE, we
quickly developed financial safeguards
in the April 2020 IFC due to the
mandatory nature of the model and the
location of all 471-participant hospitals
in MSAs where COVID–19 was most
prevalent. For example, there are 98
participant hospitals in the New York/
New Jersey Metropolitan Area, which
was the epicenter for COVID–19.44
Further, at that time, we did not possess
data that allowed CMS to determine the
COVID–19 virus’s effect on the CJR
model, and believed it was most
prudent to waive downside risk for all
episodes thorough the duration of the
PHE.
Since publishing the April 2020 IFC,
we reviewed Medicare claims data and
observe a steep decline in the initiation
of episodes in April 2020 (See Table 1).
Post April 2020, CJR episodes are
increasing, and though not at normal
utilization as compared to 2019
Medicare claims data, the data reflects
a continual initiation of CJR episodes
despite the ongoing PHE. In addition,
related Federal guidance to avoid
elective surgeries has expired, which
allows certain participant hospitals to
initiate elective LEJR procedures.45 The
continual initiation of CJR episodes
during the PHE is contrary to our
assumption in the April 2020 IFC, that
44 ‘‘New York City Region Is Now an Epicenter of
the Coronavirus Pandemic’’ March 22, 2020.
Available at https://www.nytimes.com/2020/03/22/
nyregion/Coronavirus-new-York-epicenter.html.
45 https://www.cms.gov/files/document/covidflexibility-reopen-essential-non-covid-services.pdf.
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is, we did not expect many new CJR
episodes to initiate during the PHE.
Absent a change to specify an end
date, the current extreme and
uncontrollable adjustment in 42 CFR
510.300(k)(4) would continue as long as
the PHE. Unfortunately, the
combination of CJR episode volume
increasing to levels we did not
anticipate during the PHE and the
continued renewal of the PHE threatens
the ability of the CJR model to generate
any savings over the course of the
model. With greater surgical volume, we
do not believe such a broad extreme and
uncontrollable circumstances policy for
COVID–19 remains necessary.
For these reasons, we are
implementing an end date to the
extreme and uncontrollable
circumstances adjustment for COVID–
19. Specifically, for a fracture or nonfracture episode with a date of
admission to the anchor hospitalization
that is on or within 30 days before the
date that the emergency period (as
defined in section 1135(g) of the Act)
begins or that occurs on or before March
31, 2021 or the last day of such
emergency period, whichever is earlier,
actual episode payments are capped at
the quality adjusted target price
determined for that episode under
§ 510.300. We are amending the
provisions at 42 CFR 510.305(k)(4) to
reflect this change.
In addition, in order to account for
CJR beneficiaries with a positive
COVID–19 diagnosis during a CJR
episode that initiates after the
adjustments for extreme and
uncontrollable circumstances specified
in § 510.305(k)(4) end, we are amending
our regulations at § 510.305(e)(1)(i) to
cap actual episode payments at the
quality adjusted target price for the
episode, effectively waiving downside
risk for all episodes with actual episode
payments that include a claim with a
COVID–19 diagnosis code. This policy
will apply after March 31, 2021 or the
last day of the PHE, whichever occurs
earlier.
In response to commenters’ questions
about how the CJR model will alleviate
financial risk associated with COVID–19
once the PHE expires, we explored the
flexibilities provided by other CMMI
models and found them to be consistent
with a targeted, episode-based approach
to providing financial relief from
COVID–19. In order to be responsible
stewards of the Medicare Trust Fund,
we are adopting a policy to provide
participant hospitals continuing
financial protection from the effect of
COVID–19 on the CJR model that may
continue beyond the end of the PHE for
COVID–19 or March 31, 2021
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(whichever is earlier). Specifically, at
the initial and subsequent
reconciliations of performance year
subset 5.2, which will include episodes
subject to this new adjustment policy,
we will identify episodes with actual
episode payments with any claim
containing a COVID–19 diagnosis and
costs for those episodes will be capped
at the quality adjusted target price,
effectively waiving downside risk for
that episode. A COVID–19 diagnosis is
identified by the following ICD–10–CM
diagnosis codes: B97.29; U07.1; or any
other ICD–10–CM diagnosis code that is
recommended by the Centers for Disease
Control and Prevention for the coding of
a confirmed case of COVID–19.46 We
understand that ICD–10 diagnosis codes
B97.29 (which was used for dates of
service on or after January 27, 2020
through March 31, 2020) and U07.1
(which was used for dates of service on
or after April 1, 2020 through September
30, 2020) might not be used for dates of
service to which our new adjustment
policy will apply. Nevertheless, given
the potential for uncertainty as to
whether either of these codes will be
used for dates of service after September
30, 2020, we are including them in the
definition of ‘‘COVID–19 diagnosis
code’’ that we are adding to § 510.2 for
completeness.
In order to provide participant
hospitals continuing financial
protection from the effect of COVID–19
on the CJR model that may continue
beyond the end of the PHE for COVID–
19 or March 31, 2021, whichever occurs
earlier, we are implementing that actual
episode payments are capped at the
quality adjusted target price determined
for that episode under § 510.300 for
episodes with actual episode payments
that include a claim with a COVID–19
diagnosis code and initiate after the
earlier of March 31, 2021 or the last day
of the emergency period.
III. Provisions of the Interim Final
Rule—Departments of the Treasury,
Labor and Health and Human Services
A. Rapid Coverage of Preventive
Services for Coronavirus
1. Background
In addition to the steps Congress took
to ensure coverage of COVID–19
diagnostic testing, in section 3203 of the
CARES Act, Congress required group
health plans and health insurance
issuers offering group or individual
health insurance coverage to cover,
46 https://www.cdc.gov/nchs/data/icd/ICD-10CM-Official-Coding-Gudance-Interim-Advicecoronavirus-feb-202020.pdf?fbclid=IwAR2c9LrGMAhum_Ogu-LrxPJS4u_j4wGW1615I_fmoiDB5AA0wKHKitjoXo.
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without cost sharing, qualifying
coronavirus preventive services. This
coverage is required to be provided
‘‘pursuant to section 2713(a) of the
[PHS] Act,’’ including its implementing
regulations or any successor regulations.
Section 2713 of the PHS Act was
added by section 1001 of PPACA and
incorporated by reference into ERISA by
section 715 of ERISA and into the Code
by section 9815 of the Code. Section
2713 of the PHS Act and the regulations
implementing section 2713 of the PHS
Act require non-grandfathered group
health plans and health insurance
issuers offering non-grandfathered
group or individual health insurance
coverage to provide coverage of certain
specified preventive items and services
without cost sharing. These services
include:
• Evidence-based items or services
that have in effect a rating of ‘‘A’’ or ‘‘B’’
in the current recommendations of the
USPSTF with respect to the individual
involved.
• Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
ACIP with respect to the individual
involved. A recommendation of ACIP is
considered to be ‘‘in effect’’ after it has
been adopted by the Director of the
CDC. A recommendation is considered
to be for ‘‘routine use’’ if it appears on
the Immunization Schedules of the
CDC.
• With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in the comprehensive guidelines
supported by the Health Resources and
Services Administration (HRSA).
• With respect to women, preventive
care and screenings provided for in
comprehensive guidelines supported by
HRSA (not otherwise addressed by the
recommendations of the USPSTF),
subject to certain exemptions and
accommodations (see 45 CFR 147.131
through 147.133).
The Departments’ current regulations
(herein referred to as the 2015 Final
Regulations) under section 2713 of the
PHS Act at 26 CFR 54.9815–2713; 29
CFR 2590.715–2713; and 45 CFR
147.130 require that plans and issuers
provide coverage of recommended
preventive services for plan years that
begin on or after September 23, 2010, or,
if later, for plan years that begin on or
after the date that is one year after the
date the recommendation or guideline is
issued.
Under the 2015 Final Regulations, if
a recommended preventive service is
billed separately (or is tracked as
individual encounter data separately)
from an office visit, then a plan or issuer
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may impose cost-sharing requirements
with respect to the office visit. However,
if a preventive service is not billed
separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit.
The 2015 Final Regulations generally
do not require a plan and issuer that has
a network of providers to provide
benefits for applicable preventive items
or services that are delivered by an outof-network provider. Moreover, the 2015
Final Regulations generally do not
preclude a plan or issuer that has a
network of providers from imposing
cost-sharing requirements for preventive
services that are delivered by an out-ofnetwork provider. However, if a plan or
issuer does not have in its network a
provider who can provide a preventive
service, then the plan or issuer must
cover the recommended preventive
service when performed by an out-ofnetwork provider and may not impose
cost sharing with respect to the
recommended preventive service.
Many items and services required to
be covered under section 2713 of the
PHS Act typically are provided as part
of the usual course of preventive care,
often according to regularly scheduled
intervals. Examples include
immunizations provided according to
schedules established by the CDC and
other annual screenings or counseling.
Therefore, the 2015 Final Regulations
require coverage without cost sharing
for applicable immunizations that are
recommended by ACIP for routine use,
and state that a recommendation is
considered to be for ‘‘routine use’’ if it
appears on the Immunization Schedules
of the CDC.
Section 3203 of the CARES Act
establishes a more accelerated timeline
for required coverage of qualifying
coronavirus preventive services than
other recommended preventive services
under PHS Act section 2713. As stated
above, coverage of qualifying
coronavirus preventive services must be
provided no later than 15 business days
following an applicable
recommendation. In addition, it is
possible that items, services, and
immunizations used to prevent or
mitigate COVID–19 will not, in the
immediate future, be recommended as
part of a usual course of preventive care,
but rather for more urgent use. As
reflected by the expedited timeline for
coverage Congress established in section
3203 of the CARES Act, the need to
provide coverage of qualifying
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coronavirus preventive services is
urgent. Therefore, as discussed below,
this IFC requires coverage of COVID–19
immunizations within 15 business days
after the immunization has been
recommended by ACIP and adopted by
the CDC, regardless of whether it
appears on the Immunization Schedules
of the CDC for routine use.
Additionally, in light of the current
PHE for COVID–19, it is imperative that
group health plans and health insurance
issuers provide full coverage for these
items and services, including costs for
the administration of vaccines, and
ensure timely access to coverage as
Congress intended. Accordingly, in this
IFC, the Departments provide certain
clarifications previously made with
respect to the 2015 Final Regulations
and amend those regulations to
implement unique requirements related
to covering qualifying coronavirus
preventive services.47
2. Scope of Requirement To Cover
Certain Recommended Preventive
Services Under Section 2713 of the
Public Health Service Act
a. Related Items and Services
In implementing section 2713 of the
PHS Act, the 2015 Final Regulations
addressed whether office visit charges
associated with certain recommended
preventive services must be covered
without cost sharing. Specifically,
Example 1 in the 2015 Final Regulations
illustrates how the requirements apply
in situations where a provider bills a
plan for an office visit where a
preventive screening for cholesterol
abnormalities (which has in effect a
rating of A or B from the USPSTF) is
conducted and for the laboratory work
of the cholesterol screening test. In that
example, the plan may not impose any
cost-sharing requirements with respect
to the separately billed laboratory work
of the cholesterol screening test.
Because the office visit is billed
separately from the cholesterol
screening test, the 2015 Final
Regulations provide that the plan may
impose cost-sharing requirements for
the office visit.
47 The 2015 Final Regulations address the
obligation to continue to provide coverage for
recommended preventive services that are in effect
on the first day of a plan or policy year when there
are changes in recommendations or guidelines. See
26 CFR 54.9815–2713(b)(2)(i) and (ii); 29 CFR
2590.715–2713(b)(2)(i) and (ii); 45 CFR
147.130(b)(2)(i) and (ii). Given the expedited
timeline for coverage under section 3203 of the
CARES Act, this IFC amends the 2015 Final
Regulations to make clear that these paragraphs
apply to recommended preventive services that are
covered on the first day of the plan or policy year
or, with respect to qualifying coronavirus
preventive services, ‘‘as otherwise specified in
paragraph (b)(3) of this section.’’
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Prior to the publication of the 2015
Final Regulations, the Departments
received questions from stakeholders
regarding discrete coverage issues
related to certain recommended
preventive services. In particular, with
respect to colonoscopies, stakeholders
asked whether certain related services
(such as the cost of polyp removal or
anesthesia) must also be covered
without cost sharing. The Departments
clarified in subregulatory guidance that
a plan or issuer may not impose cost
sharing for polyp removal during a
preventive screening colonoscopy, as
such service is an integral part of a
colonoscopy, and also stated that
anesthesia provided in connection with
a preventive colonoscopy must be
covered without cost sharing.48
Consistent with the examples
provided in the 2015 Final Regulations
and subregulatory guidance cited in the
preamble to the rulemaking
promulgating the 2015 Final
Regulations, the Departments further
clarify that under the 2015 Final
Regulations and this IFC, plans and
issuers subject to section 2713 of the
PHS Act must cover, without cost
sharing, items and services that are
integral to the furnishing of the
recommended preventive service,
regardless of whether the item or service
is billed separately. For example,
several of the recommended preventive
services involve screenings for the
presence of certain health conditions,
such as diabetes, or a variety of sexually
transmitted infections. These
recommended screenings, typically
performed by laboratories, cannot be
conducted without first collecting a
specimen. Accordingly, plans and
issuers subject to section 2713 of the
PHS Act must cover without cost
sharing both the specimen collection
and the recommended preventive
service, regardless of how the specimen
collection is billed. Similarly, a
recommended immunization generally
cannot be furnished without being
administered by a medical professional.
As qualifying coronavirus preventive
services are expected to include
immunizations, plans and issuers
subject to section 2713 of the PHS Act
48 See FAQs About Affordable Care Act
Implementation Part 12, Q5 (Feb. 20, 2013),
available at https://www.dol.gov/sites/dolgov/files/
EBSA/about-ebsa/our-activities/resource-center/
faqs/aca-part-xii.pdf and https://www.cms.gov/
CCIIO/Resources/Fact-Sheets-and-FAQs/aca_
implementation_faqs12 and FAQs About Affordable
Care Act Implementation Part XXVI, Q7 (May 11,
2015), available at https://www.dol.gov/sites/
dolgov/files/EBSA/about-ebsa/our-activities/
resource-center/faqs/aca-part-xxvi.pdf and https://
www.cms.gov/CCIIO/Resources/Fact-Sheets-andFAQs/Downloads/aca_implementation_faqs26.pdf.
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must cover without cost sharing such an
immunization and its administration,
regardless of how the administration is
billed, and regardless of whether a
COVID–19 vaccine or any other
immunization requires the
administration of multiple doses in
order to be considered a complete
vaccination. This includes coverage
without cost sharing of the
administration of a required preventive
immunization in instances where a
third party, such as the Federal
Government, pays for the preventive
immunization. Further, if a COVID–19
immunization is not billed separately
(or is not tracked as individual
encounter data separately) from an
office visit and the primary purpose of
the visit is the delivery of the
recommended COVID–19
immunization, then consistent with the
2015 Final Regulations, the plan or
issuer may not impose cost-sharing
requirements with respect to the office
visit. The Departments seek comment
on this clarification.
b. Out-of-Network Coverage During the
PHE for COVID–19
The 2015 Final Regulations permit a
group health plan or issuer that has a
network of providers to omit coverage or
to impose cost-sharing requirements for
recommended preventive services when
such services are provided by an out-ofnetwork provider, unless the plan or
issuer does not have in its network a
provider who can provide the service.49
This approach reflects that, as noted
earlier in this section of the preamble,
recommended preventive services
generally are obtained as part of a
regular course of preventive care, so
participants, beneficiaries, and enrollees
typically have the opportunity to seek
such care from an in-network provider.
By contrast, in the immediate term,
newly developed qualifying coronavirus
preventive services might be available
from a narrower range of providers than
other, more established recommended
preventive services. To help ensure full
access to and the widespread use of
qualifying coronavirus preventive
services to mitigate the effect of the PHE
for COVID–19 and slow transmission of
the virus, it is critical that individuals
be able to receive such services from
any provider authorized to provide the
service. Therefore, this IFC amends the
2015 Final Regulations to require that
plans and issuers subject to section 2713
of the PHS Act must cover without cost
sharing a qualifying coronavirus
preventive service, regardless of
49 26 CFR 54.9815–2713(a)(3); 29 CFR 2590.715–
2713(a)(3); 45 CFR 147.130(a)(3).
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whether such service is delivered by an
in-network or out-of-network provider.
This is based on the Departments’ view
that participants, beneficiaries, and
enrollees may not be able to locate innetwork providers consistently during
the emergency period.
To satisfy this requirement, the
Departments are of the view that plans
and issuers must administer this out-ofnetwork coverage requirement in such a
way that makes receiving out-ofnetwork services for qualifying
coronavirus preventive services a
meaningful benefit for participants,
beneficiaries, and enrollees. To be a
meaningful benefit, the Departments are
of the view that plans and issuers must
administer this out-of-network coverage
requirement in a way that ensures that
participants, beneficiaries, and enrollees
have access to a variety of out-ofnetwork providers for such services. To
the extent plans and issuers reimburse
out-of-network providers an
unreasonably low amount for qualifying
coronavirus preventive services,
including for administration of a
COVID–19 vaccine, this approach could
severely limit the number of such
providers that are willing to provide the
service, which would contravene the
purpose of the requirement to provide
out-of-network coverage without cost
sharing of qualifying coronavirus
preventive services. Therefore, this IFC
provides that with respect to a
qualifying coronavirus preventive
service and a provider with whom the
plan or issuer does not have a
negotiated rate for such service (such as
an out-of-network provider), the plan or
issuer must reimburse the provider for
such service in an amount that is
reasonable, as determined in
comparison to prevailing market rates
for such service. The Departments will
consider the amount of payment to be
reasonable, for example, if the plan or
issuer pays the provider the amount that
would be paid under Medicare for the
item or service. In the Departments’
view, these minimum payment
standards are necessary and appropriate
because providers that participate in the
CDC COVID–19 Vaccination Program
contractually agree to administer a
COVID–19 vaccine regardless of an
individual’s ability to pay and
regardless of their coverage status, and
also may not seek any reimbursement,
including through balance billing, from
a vaccine recipient.
The Departments request comment on
all aspects of this approach. The
Departments request comment on the
issue of network adequacy and whether
and, if so, how long provider networks
are expected to be inadequate. The
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71175
Departments also request comment on
the safeguards in this IFC to ensure that
out-of-network reimbursement rates are
reasonable and that providers
administering a publicly funded
COVID–19 vaccine are reimbursed by
group health plans and issuers
prevailing market rates in the absence of
a negotiated rate, and whether other
examples of reasonable reimbursement
rates, in addition to Medicare rates,
would be useful.
3. Definition of Qualifying Coronavirus
Preventive Services
Section 3203(b)(1) of the CARES Act
defines ‘‘qualifying coronavirus
preventive service’’ as an item, service,
or immunization that is intended to
prevent or mitigate COVID–19 and that
is—(A) an evidence-based item or
service that has in effect a rating of ‘A’
or ‘B’ in the current recommendations of
the USPSTF; or (B) an immunization
that has in effect a recommendation
from ACIP with respect to the
individual involved. The statutory
provisions describing USPSTF and
ACIP recommendations in this
definition are substantively identical to
the ones at section 2713(a)(1) and (2) of
the PHS Act. However, as stated above,
under the 2015 Final Regulations, only
‘‘immunizations for routine use in
children, adolescents, and adults’’ that
are recommended by ACIP must be
covered without cost sharing.50 A
recommendation is considered to be for
routine use if it is listed on the CDC’s
Immunization Schedules.51
This IFC provides a definition of
qualifying coronavirus preventive
services that is consistent with the
statutory definition in section 3203 of
the CARES Act. However, the
Departments note that unlike the other
preventive service immunizations
required to be covered without cost
sharing under section 2713 of the PHS
Act and the 2015 Final Regulations, this
definition and related coverage
requirement are not limited to COVID–
19 immunizations recommended by
ACIP for ‘‘routine use.’’ While other
preventive items and services may be
recommended for routine use, for
reasons described elsewhere in this
section of the preamble, the PHE for
COVID–19 presents unique
circumstances and qualifying
coronavirus preventive services might
not, in the immediate term, be
recommended for routine use, according
to specified schedules. Rather, the
50 See 75 FR 41726, 41728 (July 19, 2010),
codified at 26 CFR 54.9815–2713(a)(1)(ii); 29 CFR
2590.715–2713(a)(1)(ii); 45 CFR 147.130(a)(1)(ii).
51 Id.
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Departments generally expect
consumers should receive an
immunization for COVID–19 as soon as
it becomes available to the general
public, or as soon as it becomes
available to them based on their status
as part of a high-risk or high-priority
population, as recommended by ACIP.
Plans and issuers subject to section 2713
of the PHS Act must cover, without cost
sharing, COVID–19 immunizations that
are recommended by ACIP and adopted
by the Director of CDC, even if not listed
for routine use on the CDC
Immunization Schedules, pursuant to
26 CFR 54.9815–2713T(a); 29 CFR
2590.715–2713(a); and 45 CFR
147.130(a), and subject to the additional
changes described later in this section of
the preamble.52
B. Diagnostic Testing for COVID–19
4. Qualifying Coronavirus Preventive
Services—Timing Requirement
Section 2713 of the PHS Act and the
2015 Final Regulations require plans
and issuers to cover recommended
preventive items and services beginning
with the first plan year (or in the
individual market, policy year) that is
one year after the date the
recommendation or guideline is issued.
Section 3203 of the CARES Act
accelerates the timeline for coverage of
qualifying coronavirus preventive
services without cost sharing, requiring
coverage to be provided within 15
business days after the date on which a
recommendation is made relating to
such service. This IFC codifies these
timing requirements at 26 CFR 54.9815–
2713T(b)(3); 29 CFR 2590.715–
2713(b)(3); and 45 CFR 147.130(b)(3).
In addition, the IFC adds a sunset
provision at 26 CFR 54.9815–2713T(e);
29 CFR 2590.715–2713(e); and 45 CFR
147.130(e), under which the
amendments made to the regulations
will not apply with respect to qualifying
coronavirus preventive services
furnished on or after the expiration of
the PHE for COVID–19. The
Departments note, however, that
coverage under section 3203 of the
CARES Act is not limited to the
duration of the PHE for COVID–19 and
therefore the statutory provisions will
continue to apply.
Section 6001 of the FFCRA generally
requires group health plans and health
insurance issuers offering group or
individual health insurance coverage to
provide benefits for COVID–19
diagnostic tests and certain items and
services related to diagnostic testing for
COVID–19 when those items or services
are furnished on or after March 18,
2020, and during the duration of the
PHE for COVID–19. Under the FFCRA,
plans and issuers must provide this
coverage without imposing any costsharing requirements (including
deductibles, copayments, and
coinsurance) or prior authorization or
other medical management
requirements. Section 3201 of the
CARES Act, enacted on March 27, 2020,
amended section 6001 of the FFCRA to
include a broader range of diagnostic
tests that plans and issuers must cover
without any cost-sharing requirements
or prior authorization or other medical
management requirements.
Section 3202(a) of the CARES Act
provides that a plan or issuer providing
coverage of items or services described
in section 6001(a) of the FFCRA shall
reimburse the provider of the diagnostic
testing at a rate negotiated with the
provider, or if there is no negotiated
rate, at an amount that equals the cash
price for such service as listed by the
provider on a public internet website.
As previously articulated in guidance,
the Departments interpret the
requirement to provide coverage
without cost sharing in section 6001 of
the FFCRA, together with section
3202(a) of the CARES Act, as
establishing a process for setting
reimbursement rates and protecting
participants, beneficiaries, and enrollees
from being balance billed for an
applicable COVID–19 test.53 These
provisions help ensure consumers can
be tested for COVID–19 without barriers
related to cost, and are critical to the
ability to detect the virus and stop its
spread. However, testing efforts have
continued to be hampered by
challenges, such as delays in obtaining
results, issues with test accuracy, and
supply shortages.54
52 HHS reminds states that the HHS Office for
Civil Rights enforces applicable Federal civil rights
laws as described above, as well as laws protecting
the exercise of conscience and religious freedom,
including the Religious Freedom Restoration Act
(42 U.S.C. 2000bb through 2000bb–4). HHS’s
requirements are subject to these laws, and states
may have obligations under these laws to protect
conscience, prohibit coercion, and to ensure the
free exercise of religion. U.S. Department of Health
& Human Services, Office for Civil Rights,
Conscience and Religious Freedom, https://
www.hhs.gov/conscience/ (last visited
Aug. 20, 2020).
53 FAQs About Families First Coronavirus
Response Act and Coronavirus Aid, Relief, and
Economic Security Act Implementation Part 43
(June 23, 2020), available at https://www.cms.gov/
files/document/FFCRA-Part-43-FAQs.pdf and
https://www.dol.gov/sites/dolgov/files/ebsa/aboutebsa/our-activities/resource-center/faqs/aca-part43.pdf.
54 American Society for Microbiology, ‘‘Supply
Shortages Impacting COVID–19 and Non-COVID
Testing’’ (Oct. 15, 2020), available at https://
asm.org/Articles/2020/September/ClinicalMicrobiology-Supply-Shortage-Collecti-1.
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The Departments encourage group
health plans and issuers of group or
individual health insurance coverage to
consider market-driven approaches to
addressing these continued challenges
surrounding COVID–19 diagnostic
testing. The Departments encourage
plans and issuers to explore using
payment arrangements that create
incentives for providers to reduce the
time it takes to provide results for
diagnostic testing for COVID–19, while
maintaining the accuracy rates of their
test results in instances where it is
within the ability of providers to
address a delay.
At certain points in this PHE, there
have been wide variations in the time it
takes providers to make test results
available to consumers. These delays in
obtaining test results increase the risk
that infected individuals may
unknowingly infect others. These delays
could be caused by large volumes of
tests to process and/or inadequate
resources. Pay-for-performance
arrangements, where reimbursement
rates are based on the time it takes to
make test results available, could
encourage innovative approaches by
providers to reduce the turnaround
time. The Departments encourage group
health plans and issuers of group or
individual health insurance coverage to
consider developing such arrangements
with providers, and strongly encourage
plans and issuers that do so to
incorporate safeguards to ensure that the
payment arrangements are not
structured in a way that prioritizes
speed over accuracy or that result in
unintended consequences, such as
reduction in access to COVID–19
diagnostic testing or non-compliance
with balance billing restrictions.
IV. Provisions of the Interim Final Rule
Regarding State Innovation Waivers—
Department of the Treasury and Health
and Human Services
A. State Innovation Waivers Policy and
Regulatory Revisions in Response to the
PHE for COVID–19 Public Health
Emergency
1. Background
Section 1332 of the PPACA permits
states to apply for a State Innovation
Waiver (also referred to as ‘‘section 1332
waivers’’ or ‘‘State Relief and
Empowerment Waivers’’) to pursue
innovative strategies for providing their
residents with access to higher value,
more affordable health coverage. The
overarching goal of section 1332 waivers
is to give all Americans the opportunity
to obtain high value and affordable
health coverage regardless of income,
geography, age, sex, or health status,
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while simultaneously empowering
states to develop health coverage
strategies that best meet the needs of
their residents. Section 1332 waivers
provide states an opportunity to
promote a stable health insurance
market that offers more choice and
affordability to their residents. Under
section 1332 of the PPACA, a State
Innovation Waiver can be approved by
HHS and the Department of the
Treasury if it provides access to quality
health coverage that is at least as
comprehensive and affordable as would
be provided absent the waiver, provides
coverage to a comparable number of
residents of the state as would be
provided coverage absent a waiver, and
does not increase the Federal deficit. To
date, HHS and the Department of the
Treasury have approved 15 state waiver
requests, 14 of which implement statebased reinsurance programs.55 As noted
in a recent data brief issued by CMS,
section 1332 state-based reinsurance
waivers have resulted in a statewide
average premium reduction ranging
from four to 37 percent in calendar year
2020 for residents in states with
approved waivers.56 Reinsurance
provides a direct benefit to consumers
by paying a portion of provider claims
that would otherwise be paid by
consumers through higher premiums
and lowering premiums for people in
the individual health insurance market.
HHS and the Department of the
Treasury continue to encourage states to
take advantage of the flexibilities
available through section 1332 waivers
in order to pursue solutions to help
lower costs and increase coverage
choices for Americans faced with
unaffordable premiums and reduced
competition in the insurance market
both during and after the PHE for
COVID–19.
Section 1332(a)(4)(B) of the PPACA
requires the Secretary of HHS and the
Secretary of the Treasury (the
Secretaries) to issue regulations
regarding procedures for State
Innovation Waivers. On March 14, 2011,
HHS and the Department of the
Treasury published the ‘‘Application,
Review, and Reporting Process for
Waivers for State Innovation’’ proposed
rule (76 FR 13553) to implement section
55 More information on section 1332 waivers that
are approved is available online: https://
www.cms.gov/CCIIO/Programs-and-Initiatives/
State-Innovation-Waivers/Section_1332_State_
Innovation_Waivers-.
56 CCIIO Data Brief Series: State Relief and
Empowerment Waives: State-based Reinsurance
Programs. June 2020. Available online: https://
www.cms.gov/CCIIO/Programs-and-Initiatives/
State-Innovation-Waivers/Downloads/1332-DataBrief-June2020.pdf.
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1332(a)(4)(B) of the PPACA.57 On
February 27, 2012, HHS and the
Department of the Treasury published
the ‘‘Application, Review, and
Reporting Process for Waivers for State
Innovation’’ final rule (77 FR 11700)
(hereinafter referred to as the ‘‘2012
Final Rule’’).58 On October 24, 2018,
HHS and the Department of the
Treasury issued the ‘‘State Relief and
Empowerment Waivers’’ guidance (83
FR 53575) (hereinafter referred to as the
‘‘2018 Guidance’’), which superseded
the previous guidance published on
December 16, 2015 (80 FR 78131), and
provided additional information about
the requirements that states must meet
regarding section 1332 waiver
proposals, the Secretaries’ application
review procedures, pass-through
funding determinations, certain
analytical requirements, and operational
considerations.59 60
Section 1332(a)(4)(B) of the PPACA
also directs HHS and the Department of
the Treasury to issue regulations that
provide for state and Federal public
notice and comment sufficient to ensure
a meaningful level of public input
regarding a state’s section 1332 waiver
plan, both during the application
process and after a waiver is
implemented. Current regulations and
guidance address how states may apply
for a waiver, information states must
include in an application, public notice
and comment requirements, and HHS’
and the Department of the Treasury’s
monitoring and compliance activities,
including state reporting requirements
(collectively referred to as public notice
procedures).
The Secretaries are setting forth a
process for states to request
modifications to the public notice
procedures during the PHE for COVID–
19 prior to and after approval of a
section 1332 waiver that continue to
meet the statutory and regulatory
requirements that the public has an
opportunity to provide meaningful
input. Further the Secretaries are
promulgating this rule so that HHS and
the Department of the Treasury do not
impose requirements that are
unreasonable or unnecessarily
burdensome regarding state compliance
consistent with section 1332(a)(4)(B)(iii)
of the PPACA during the PHE for
COVID 19. This IFC promulgates rules
to establish a framework for the
57 https://www.govinfo.gov/content/pkg/FR-201103-14/pdf/2011-5583.pdf.
58 https://www.govinfo.gov/content/pkg/FR-201202-27/pdf/2012-4395.pdf.
59 https://www.govinfo.gov/content/pkg/FR-201810-24/pdf/2018-23182.pdf.
60 https://www.govinfo.gov/content/pkg/FR-201512-16/pdf/2015-31563.pdf.
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Secretaries to modify some of the
existing regulatory public notice
procedures to expedite a decision on a
proposed waiver request during the PHE
for COVID–19 when a delay would
undermine or compromise the purpose
of the proposed waiver request and be
contrary to the interests of consumers.
The Secretaries will also make available
such flexibility regarding public notice
procedures should any state with an
approved section 1332 waiver request
an extension or amendment of an
approved section 1332 waiver during
the PHE for COVID–19.
Similarly, this IFC also establishes a
framework for the Secretaries to modify,
in part, post award public notice
procedures for an approved waiver
request that would otherwise take place
or become due during the PHE for
COVID–19. The Secretaries will also
make available such flexibility for post
award public notice procedures for
approved waiver extensions,
amendments, or phase-out for a waiver
should those otherwise take place or
become due during the PHE for COVID–
19. HHS and the Department of the
Treasury are of the view that section
1332 waivers are a critical tool for states
to ensure patients have stable access to
health care coverage, including during
the PHE for COVID–19. These interim
final provisions are effective
immediately for the duration of the PHE
for COVID–19. HHS and the Department
of the Treasury note that existing threats
to consumers’ access to health coverage
or care—such as in geographic areas in
which issuer participation has been low
for some time—would not be considered
emergency situations for purposes of
applying the flexibilities adopted in this
rulemaking.
2. Public Notice Procedures and
Approval Processes During the PHE (31
CFR 33.118 and 45 CFR 155.1318)
Section 1332(a)(4)(B) of the PPACA
provides that the Secretary of HHS and
the Secretary of the Treasury shall issue
regulations providing a process for
public notice and comment at the state
level, including public hearings, and a
process for providing public notice and
comment after the application is
received by the Secretaries, that are both
sufficient to ensure a meaningful level
of public input. Current regulations at
§§ 33.112 and 155.1312 specify state
public notice and participation
requirements for proposed waiver
requests, and §§ 33.116(b) and
155.1316(b) specify the accompanying
public notice and comment period
requirements under the Federal public
notice and approval process.
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Under the current regulations at
§§ 33.112 and 155.1312, states are
required to provide a public notice and
comment period prior to submitting an
application for a new section 1332
waiver. The notice must include a
comprehensive description of the
section 1332 waiver application;
information about where the application
is available for public review; where the
written comments may be submitted;
and the location, date, and time of
public hearings that will be convened
by the state to seek public input on the
application for a section 1332 waiver.61
After issuing the public notice and prior
to submitting an application for a
section 1332 waiver, the state must hold
public hearings to allow the public to
learn about and comment on the state’s
application, and must publish the date,
time, and location of the hearings in a
prominent location on the state’s public
website.62 As set forth in §§ 33.112(a)(2)
and 155.1312(a)(2), as part of the public
notice and comment period, a state with
one or more federally recognized tribes
must conduct a separate process for
meaningful consultation with such
tribes, if applicable. As HHS and the
Department of the Treasury explained in
the 2012 Final Rule preamble, this tribal
consultation must be conducted in
accordance with Executive Order (E.O.)
13175, and, as E.O. 13175 also applies
to Medicaid, a state may use a Medicaid
consultation process to satisfy the
consultation needed for a section 1332
waiver (77 FR 11700, 11706).
Furthermore, the state should include in
its section 1332 waiver application a
description of issues raised and
comments received.
In addition, under section
1332(a)(4)(B)(iii) of the PPACA and the
existing implementing regulations at
§§ 33.116(b) and 155.1316(b), the
Secretary of HHS and the Secretary of
the Treasury are required to provide a
Federal public notice and comment
period following their preliminary
61 31
CFR 33.112(b); 45 CFR 155.1312(b).
response to a question from a commenter,
the 2012 Final Rule states that ‘‘hearings,’’ as used
in 31 CFR 33.112(c)(1) and 45 CFR 155.1312(c)(1),
means no less than two hearings. (77 FR 11700,
11706). The HHS and the Department of Treasury
continue to interpret the regulatory requirement
that a State shall hold ‘‘hearings’’ to refer to at least
two hearings, except as otherwise provided by the
amendments made in this IFC. The existing
regulation does not expressly rely on the statutory
requirement that the Secretaries of HHS and
Treasury establish ‘‘a process for public notice and
comment at the State level, including public
hearings . . . ’’ and HHS and the Department of the
Treasury are of the view that language, by itself,
does not require a particular state to hold more than
one hearing. Rather, the statutory language
describes a process applicable across multiple
states, which will, in the aggregate, necessarily
involve multiple hearings.
62 In
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determination that a state’s section 1332
waiver application is complete.
Section 1332 waivers may vary
significantly in their complexity and
breadth. The existing regulations
generally provide states and the Federal
Government flexibility in determining
and/or extending the length of the
comment periods. Both the state and the
Federal public notice and comment
periods must be sufficient to ensure a
meaningful level of public input. The
2018 Guidance 63 further specifies that
the state comment period should be no
less than 30 days, and explains that
consistent with HHS regulations, waiver
applications must be posted online in a
manner that meets technical standards
for website accessibility similar to
applicable national standards 64 to
ensure access for individuals with
disabilities.
HHS and the Department of the
Treasury recognize that the current
section 1332 regulations regarding state
and Federal public notice procedures
and comment period requirements may
impose barriers for states pursuing a
proposed waiver request during the PHE
for COVID–19.65 It is the mission of
HHS to enhance and protect the health
and well-being of all Americans. As
such, HHS and the Department of the
Treasury are issuing this guidance to
protect public health and to prevent the
spread of COVID–19 by limiting the
need for in-person gatherings related to
63 83 FR 53575 (https://www.govinfo.gov/content/
pkg/FR-2018-10-24/pdf/2018-23182.pdf).
64 ‘‘National standards’’ refers to standards issued
by the Architectural and Transportation Barriers
Compliance Board (often referred to as ‘‘section
508’’ standards), or alternatively, the World Wide
Web Consortium’s Web Content Accessibility
Guidelines (WCAG) 2.0 Level AA standards. See 83
FR 53575, 53583 (Oct. 24, 2018).
65 During the PHE for COVID–19, under the
Secretaries’ discretion, HHS and the Department of
the Treasury have allowed states to conduct their
public forums virtually, both prior to application
submission and post award. For example, following
the scheduling and notice of the hearings, and in
consultation with CMS, the New Hampshire
Insurance Department rescheduled planned inperson public hearings to an online webinar format
in response to social distancing guidance provided
by New Hampshire Governor Chris Sununu and the
Federal government. (https://www.nh.gov/
insurance/lah/documents/nh-section-1332-waiverdraft.pdf). Georgia also offered public hearings
virtually because of public health concerns
regarding large, in-person gatherings during the
COVID–19 pandemic. In addition, as of July 13,
2020, several states with approved waivers
conducted their post award forum virtually due to
COVID–19, including Alaska, Colorado, Delaware,
Maine, Maryland, Minnesota, Montana, Oregon,
North Dakota, Rhode Island, and Wisconsin. In this
IFC, the Secretaries expand and build upon this
approach by providing more flexibility to allow
HHS and the Department of the Treasury to
expedite a decision on a proposed waiver request.
(https://medicaid.georgia.gov/document/document/
georgia1332waiverapplicationfinal07312020vfpdf/
download).
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section 1332 waivers during the PHE.
Additionally, states may face
uncertainty as to whether their waiver
request will be approved in time, given
the state and Federal public notice
procedures or other public participation
requirement associated with state
procedures that would otherwise
require an in-person gathering, to
expeditiously reform their health
insurance markets and to protect
consumers from the effects of the PHE
for COVID–19. Some states may not
consider more robust changes because
they are concerned that the current
section 1332 waiver application
requirements are too time-consuming or
burdensome to pursue during the PHE
for COVID–19. Therefore, HHS and the
Department of the Treasury are of the
view that having the flexibility to
modify certain public notice procedures
and participation requirements during
the PHE for COVID–19 will protect
public health and health insurance
markets, and will increase flexibility
and reduce burdens for states seeking to
use section 1332 waivers as a means of
innovation for providing coverage,
lowering premiums, and improving
their health care markets.
Section 1332 waivers are a critical
tool for states to ensure patients across
the country have access to health care
coverage. About 10.7 million
individuals on average rely on the
Exchanges to purchase individual
health insurance coverage throughout
the year.66 67 Although recently there
have been positive premium
stabilization and insurer participation
trends, the COVID–19 pandemic has
introduced new uncertainties in the
individual and small group markets
such that past trends resulting in
limited access and affordability may
return in some areas. For example, in
response to the uncertainty created by
the PHE for COVID–19 regarding health
care utilization rates and claims costs,
such as those associated with testing
and treatment for COVID–19, premiums
may increase and issuers may reduce
their presence or coverage options in the
individual and small group markets.
Additionally, due to the PHE for
COVID–19, some issuers may have
difficulty predicting the composition of
their risk pools given uncertainty about
66 American Health Benefit Exchanges, or
‘‘Exchanges,’’ are entities established under PPACA
through which qualified individuals and qualified
employers can purchase health insurance coverage
in qualified health plans (QHPs).
67 First Half of 2020 Average Effectuated
Enrollment Data, available at https://www.cms.gov/
CCIIO/Resources/Forms-Reports-and-OtherResources/Downloads/Early-2020-2019-EffectuatedEnrollment-Report.pdf.
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the risk profiles of many new enrollees
coming from employer-sponsored
coverage and the potential transition of
other enrollees to Medicaid due to
income loss. Therefore, HHS and the
Department of the Treasury are
concerned that past trends that threaten
the stability of the individual market
risk pool may return, leading some
issuers to cease offering coverage on the
Exchanges in some states and counties
and leading other issuers to increase
their rates, leaving some geographic
areas with limited or no affordable
Exchange coverage options. Permitting
the Secretary of HHS and the Secretary
of the Treasury to modify the public
notice procedures, in part, will help
states seeking section 1332 waivers to
address such circumstances more
quickly and develop innovative ways to
ensure consumers have access to
affordable health care coverage. As
such, HHS and the Department of the
Treasury are of the view that, if certain
safeguards are met, it is in the best
interest of the public to provide states
applying for section 1332 waivers with
the option to request to modify public
notice procedures during the PHE for
COVID–19.
This IFC adds the new §§ 33.118 and
155.1318 and provides that the
Secretary of HHS and the Secretary of
the Treasury may modify, in part, the
state public notice requirements
specified in §§ 33.112 and 155.1312 and
the Federal public notice requirements
specified at §§ 33.116(b) and
155.1316(b) to expedite a decision on a
proposed waiver request during the PHE
for COVID–19 when a delay would
undermine or compromise the purpose
of the proposed waiver request and be
contrary to the interests of consumers.
Examples of the public notice
procedures that currently apply under
the aforementioned regulations that a
state may seek to have waived or
modified include the requirement that
states notify the public and hold
hearings prior to submitting an
application, that the state hold more
than one public hearing in more than
one location and that HHS and the
Department of the Treasury provide for
public notice and comment after an
application is determined to be
complete. States may also seek to
modify the state and/or Federal
comment periods to be less than 30 days
and to host public hearings virtually
rather than in-person.
For a state to qualify for modification
of the state or Federal public notice
requirements to expedite a decision on
a proposed waiver request during the
PHE for COVID–19, a delay must
undermine or compromise the purpose
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of the proposed waiver request and be
contrary to the interests of consumers.
During the PHE for COVID–19, the
Secretary of HHS and the Secretary of
the Treasury (the Secretaries) may
modify the Federal and/or state public
notice procedures, in part, if the state
meets all of the following:
• The state requests a modification in
the form and manner specified by the
Secretaries.
• The state acted in good faith, and in
a diligent, timely, and prudent manner
in the preparation of the request for the
modification for the waiver, and the
waiver application request.
• The state details in its request for a
modification, as applicable, the
reason(s) the state seeks a modification
from the state public notice procedures,
describes how the state meets the
modification criteria, and describes the
alternative public notice procedures it
proposes to implement at the state level,
including public hearings, that are
designed to provide the greatest
opportunity and level of meaningful
public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the state’s request for a
modification.
• The state details in its request for a
modification, as applicable, the
justification for the request and the
alternative public notice procedures it
requests to be implemented at the
Federal level.
• The state must, as applicable,
implement the alternative public notice
procedures at the state level if the state’s
modification request is approved and, if
required, amend the waiver application
to specify that it is the state’s intent to
comply with those alternative public
notice procedures in the state’s
modification request.
Any state submitting a proposed
waiver request during the PHE for
COVID–19 can submit a request to the
Secretary of HHS and the Secretary of
the Treasury for this modification from
the state and/or Federal public notice
procedures or include such a request in
its section 1332 waiver application
request.
The Secretary of HHS and the
Secretary of the Treasury’s review and
consideration of a modification request
will vary based on the state’s
circumstances, its modification request,
and the complexity and breadth of the
state’s proposed section 1332 waiver
request. For example, during the PHE
for COVID–19, many states are
prohibiting in-person public gatherings
or establishing stay-at-home orders due
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71179
to the public health threat.68 States
seeking new section 1332 waiver(s) that
have such prohibitions in effect at the
time they would have otherwise have to
conduct public notice would most likely
be unable to comply with the public
notice requirements to hold two inperson public hearings prior to
submission of their section 1332 waiver
applications in accordance with the
2018 Guidance addressing requirements
under §§ 33.112(b) and 155.1312(b). In
such cases, this IFC will allow the
Secretaries to grant the state’s request to
hold the two public hearings virtually,
rather than in-person, or to hold one
public hearing at the state level, rather
than two public hearings at the state
level. As another example, the
Secretaries may agree with a state that,
due to emergency circumstances that
have arisen related to the PHE for
COVID–19, there is insufficient time for
the state to provide public notice and
hold any public hearings at the state
level prior to submitting its section 1332
waiver application as required by
§§ 33.112(a) and 155.1312(a), and grant
the state’s request to provide public
notice and hold public hearings at the
state level after the state submits its
section 1332 waiver application.
In situations where HHS and the
Department of the Treasury determine
that public notice and hearings are
warranted on a different timeframe and
may occur after the submission of a
state’s waiver application request, the
state will be required to amend the
application request as necessary to
reflect public comments or other
relevant feedback received during the
alternative public notice procedures.
HHS and the Department of the
Treasury will evaluate a state’s request
for a modification and issue their
modification determination within
approximately 15 calendar days after
the request is received. In assessing
whether a state acted in good faith, and
in a diligent, timely, and prudent
manner in the preparation of the
modification request for the waiver, and
for the waiver application, HHS and the
Department of the Treasury will
evaluate whether the relevant
circumstances constitute an emergency.
HHS and the Department of the
Treasury remind states that any public
participation processes must continue to
comply with applicable Federal civil
rights laws, including taking reasonable
steps to provide meaningful access for
individuals with limited English
68 https://khn.org/morning-breakout/statesdeclare-emergencies-ban-large-gatherings-ascoronavirus-sweeps-the-nation/. https://
www.axios.com/states-shelter-in-place-coronavirus66e9987a-a674-42bc-8d3f-070a1c0ee1a9.html.
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proficiency and taking appropriate steps
to ensure effective communication with
individuals with disabilities, including
accessibility of information and
communication technology. Please note
that virtual meetings may present
additional accessibility challenges for
people with communications and
mobility disabilities, as well as to those
who lack broadband access. Ensuring
effective communication may include
providing American Sign Language
interpretation and real-time captioning,
and ensuring that the platform is
interoperable with assistive technology
for those with mobility difficulties. HHS
and the Department of the Treasury
especially encourage states to strive to
obtain meaningful input from
potentially affected populations,
including low-income residents,
residents with high expected health care
costs, persons less likely to have access
to care, and members of federallyrecognized tribes, if applicable, as part
of any alternative public participation
process.69
The Secretary of HHS will publish on
the CMS website any modification
determinations within 15 calendar days
of the Secretary of HHS and the
Secretary of the Treasury making such
a determination, as well as the approved
revised timeline for public comment at
the state and Federal level, as
applicable. In addition, under the new
§§ 33.118 and 155.1318, the state will be
required to publish on its website any
modification requests and
determinations within 15 calendar days
of receipt of the determination, as well
as the approved revised timeline for
public comment at the state and Federal
level, as applicable.
3. Monitoring and Compliance (31 CFR
33.120 and 45 CFR 155.1320)
As section 1332 waivers are likely to
a have a significant impact on
individuals, states, and the Federal
Government, the 2012 Final Rule
established processes and
methodologies to ensure that the
Secretary of HHS and the Secretary of
the Treasury receive adequate and
appropriate information regarding
69 As noted above, the HHS Office for Civil Rights
enforces applicable Federal civil rights laws as
described above, as well as laws protecting the
exercise of conscience and religious freedom,
including the Religious Freedom Restoration Act
(42 U.S.C. 2000bb through 2000bb–4). HHS’s
requirements are subject to these laws, and states
may have obligations under these laws to protect
conscience, prohibit coercion, and to ensure the
free exercise of religion. U.S. Department of Health
& Human Services, Office for Civil Rights,
Conscience and Religious Freedom, https://
www.hhs.gov/conscience/ (last visited
Aug. 20, 2020).
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19:21 Nov 05, 2020
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section 1332 waivers (consistent with
section 1332(a)(4)(B)(iv) of the PPACA).
Under §§ 33.120(c) and 155.1320(c), to
ensure continued public input within at
least 6 months after the implementation
date, and annually thereafter, states are
required to hold a public forum at
which members of the public have an
opportunity to provide comments on the
progress of the program authorized by
the section 1332 waiver and to provide
a summary of this forum to the
Secretary of HHS as part of the quarterly
and annual reports required under
§§ 33.124 and 155.1324. Under
§§ 33.120(c)(1) and 155.1320(c)(1), states
are required to publish the date, time,
and location of the public forum in a
prominent location on the state’s public
website at least 30 days prior to the date
of the planned public forum.
This IFC adds new §§ 33.120(c)(2) and
155.1320(c)(2), which provide that the
Secretary of HHS and the Secretary of
the Treasury (the Secretaries) may
waive, in part, post award public notice
requirements for an approved waiver
outlined in §§ 33.120(c) and 155.1320(c)
during the PHE for COVID–19 when the
application of the post award public
notice procedures would be contrary to
the interests of consumers during the
PHE for COVID–19.
The Secretaries may modify the post
award public notice procedures, in part,
when the state meets all of the
following:
• The state requests a modification in
the form and manner specified by the
Secretaries.
• The state acts in good faith, and in
a diligent, timely, and prudent manner
to comply with the monitoring and
compliance requirements under the
regulations and specific terms and
conditions of the waiver and to submit
and prepare the request for a
modification.
• The state details in its request for a
modification the reason(s) the state
seeks a modification from the state post
award public notice procedures,
describes how the state meets the
modification criteria, and describes the
alternative post award public notice
procedures it proposes to implement at
the state level, including public
hearings, that are designed to provide
the greatest opportunity and level of
meaningful public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the state’s request for a
modification.
As part of HHS and the Department of
the Treasury’s monitoring and oversight
of approved section 1332 waivers, the
Secretary of HHS and the Secretary of
the Treasury, at their discretion,
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monitor the state’s compliance with the
specific terms and conditions of the
waiver including, but not limited to,
compliance with the guardrails,
reporting requirements, and the post
award forum requirements. Under the
flexibilities provided in this IFC, the
Secretaries may, for example, allow the
public forum for an approved waiver
that would take place or become due
during the PHE for COVID–19 to be held
virtually rather than as an in person
gathering. HHS and the Department of
the Treasury will work closely with
states that have these approved
flexibilities through oversight and
monitoring activities to ensure open
communication with states during the
PHE for COVID–19. HHS and the
Department of the Treasury also will
remain focused on ensuring the public
is informed about the implementation of
programs authorized by section 1332
waivers and have a meaningful
opportunity to comment on the
implementation.
The Secretary of HHS and the
Secretary of the Treasury will evaluate
a state’s request for a modification and
issue their modification determination
within approximately 15 calendar days
after the request is received. The state is
required to publish on its website any
modification requests and
determinations by HHS and the
Department of the Treasury within 15
calendar days of receipt of the
determination, as well as information on
the approved revised timeline for the
state’s post award public notice
procedures, as applicable. Since the
state is already required to post
materials as part of post award annual
reporting requirements, such as the
notice for the public forum and annual
report, states will be responsible for
ensuring that the public is aware of the
determination to modify the public
notice procedures and must include this
information along with the information
required under §§ 33.120(c)(1) and
155.1320(c)(1) in a prominent location
on the state’s public website.
HHS and the Department of the
Treasury are of the view that post award
forums are critical to ensure that the
public has a regular opportunity to learn
about and comment on the progress of
section 1332 waivers. States that receive
approval, to modify, in part, these post
award public notice procedures would
still need to meet all other requirements
specified in §§ 33.112(b) and
155.1312(b). For example, should the
state receive a modification approval
that permits it to hold the post award
public forum virtually instead of in
person, the state must still publish the
notice of its post award public notice on
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the state’s public website and use other
effective means to communicate the
required information to the public. The
public notice must include the website,
date, and time of the public forum that
will be convened by the state,
information related to the timeframe for
comments, and how comments from the
public on the section 1332 waiver must
be submitted. HHS and the Department
of the Treasury remind states that they
still must also comply with Federal civil
rights requirements, including laws
pertaining to accessibility, if the
Secretary of HHS and the Secretary of
the Treasury approve a modification
from all or a portion of the post award
public notice procedures. In such a
circumstance, the state would need to
ensure these virtual public hearings are
as accessible as possible during the PHE
for COVID–19 so members of the public
can participate and submit comments.
The state should also track how many
people are attending these forums, if
possible.
V. Waiver of Proposed Rulemaking
Section 553(b) of the APA requires the
agency to publish a notice of the
proposed rule in the Federal Register
that includes a reference to the legal
authority under which the rule is
proposed, and the terms and substance
of the proposed rule or a description of
the subjects and issues involved.
Section 553(c) further requires the
agency to give interested parties the
opportunity to participate in the
rulemaking through public comment
before the provisions of the rule take
effect. Section 553(b)(B) authorizes the
agency to waive these procedures,
however, if the agency finds good cause
that notice and comment procedures are
impracticable, unnecessary, or contrary
to the public interest and incorporates a
statement of the finding and its reasons
in the rule issued.
Section 553(d) ordinarily requires a
30-day delay in the effective date of a
final rule from the date of its
publication in the Federal Register.
This 30-day delay in effective date can
be waived, however, if an agency finds
good cause to support an earlier
effective date. Finally, the Congressional
Review Act (CRA) requires a delay in
the effective date for major rules unless
an agency finds good cause that notice
and public procedure are impracticable,
unnecessary, or contrary to the public
interest, in which case the rule shall
take effect at such time as the agency
determines. 5 U.S.C. 801(a)(3), 808(2).
As noted earlier in this preamble, on
January 30, 2020, the International
Health Regulations Emergency
Committee of the WHO declared the
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outbreak a ‘‘Public Health Emergency of
international concern.’’ On January 31,
2020, pursuant to section 319 of the
PHS, the HHS Secretary determined that
a PHE exists for the United States to aid
the nation’s health care community in
responding to COVID–19. On March 11,
2020, the WHO publicly declared
COVID–19 a pandemic. On March 13,
2020, the President declared the
COVID–19 pandemic a national
emergency. Effective October 23, 2020,
the HHS Secretary renewed the January
31, 2020 determination, which was
previously renewed on April 21, 2020
and July 25, 2020, that a PHE exists and
has existed since January 27, 2020. This
declaration, along with the HHS
Secretary’s January 30, 2020 declaration
of a PHE, conferred on the HHS
Secretary certain waiver authorities
under section 1135 of the Act. On
March 13, 2020, the HHS Secretary
authorized waivers under section 1135
of the Act, effective March 1, 2020.70
It is critically important that the
Departments implement the policies in
this IFC as quickly as possible. As the
United States is in the midst of the PHE
for COVID–19, the Departments find
good cause to waive notice of proposed
rulemaking under the APA, 5 U.S.C.
553(b)(B). For those same reasons, as
authorized by section 808(2) of the CRA,
the Departments find it is impracticable
and contrary to the public interest not
to waive the delay in effective date of
this IFC under section 801 of the CRA.
Therefore, the Departments find there is
good cause to waive the CRA’s delay in
effective date pursuant to section 808(2)
of the CRA. Thus, the Departments find
good cause to waive the applicable
delays in the effective date and,
moreover, to establish these policies in
this IFC applicable as of the date of
display at the Office of the Federal
Register.
In this IFC, consistent with section
1902(a)(4) and (a)(19) of the Act, the
Department adds a new subpart G to 42
CFR part 433 to provide states with
more flexibility, subject to certain
safeguards, in implementing the
requirement in section 6008(b)(3) of the
FFCRA that states maintain Medicaid
beneficiary enrollment in order to
receive the temporary increase in
Federal funding in the FFCRA. This
temporary funding increase is effective
beginning January 1, 2020 and could
extend through the last day of the
calendar quarter in which the PHE for
COVID–19, including any extensions,
terminates, if the state claims the
70 https://www.phe.gov/emergency/news/
healthactions/section1135/Pages/covid1913March20.aspx.
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temporary funding increase in that
quarter. This provision of the IFC is
immediately necessary to ensure that
states can determine eligibility and
provide care and services during the
PHE in a manner that is consistent with
simplicity of administration and the
best interests of beneficiaries and also
claim the temporary funding increase.
In this IFC, HHS and the Department
of the Treasury are setting forth
flexibilities in the public notice and
post award public participation
requirements for a State Innovation
Waiver described in section 1332 of
PPACA during the PHE for COVID–19.
HHS and the Department of the
Treasury recognize that following the
normal state and Federal public notice
procedures and the state post award
requirements for section 1332 waivers
may impose barriers for states pursuing
a proposed waiver request during the
PHE for COVID–19. This guidance is
intended to protect public health and
prevent the spread of COVID–19 by
limiting the need for in-person
gatherings related to a section 1332
waiver. Additionally, states may face
uncertainty as to whether their waiver
requests will be approved in time to
expeditiously reform their health
insurance markets and to protect
consumers from the effects of the PHE
for COVID–19. Some states may not
consider more robust changes because
they were concerned that the current
section 1332 waiver application
requirements are too time-consuming or
burdensome to be helpful during the
PHE for COVID–19. HHS and the
Department of the Treasury are of the
view that the flexibility to modify
certain public notice procedures and
participation requirements will increase
flexibility and reduce burden for states
seeking to use section 1332 waivers as
a means of innovation for providing
coverage, lowering premiums, and
improving their health care markets
during the PHE for COVID–19. As such,
these flexibilities are immediately
necessary to provide states applying for
a section 1332 waiver or during the post
award period with the option to request
a modification from the state and/or
Federal public notice requirements
when a delay would undermine or
compromise the purpose of the waiver
and be contrary to the interests of
consumers. HHS and the Department of
the Treasury are of the view that it
could be contrary to the public interest
to require full notice and comment
during the current PHE for COVID–19
because following the normal
timeframes and requirements could
result in waiver approvals for
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innovative waivers taking effect after
issuers have already made their
decisions regarding issuer participation
in the individual market and after rates
for the upcoming plan year have been
submitted. A modification from the
public participation requirements
would be beneficial to the public
interest by providing states and the
Federal Government the flexibilities
necessary to review and approve, as
appropriate, section 1332 waivers that
expand access to coverage on a faster
timeframe.
In this IFC, the Departments amend
the regulations under section 2713 of
the PHS Act to implement the
requirement in section 3203 of the
CARES Act that non-grandfathered
group health plans and health insurance
issuers offering non-grandfathered
group or individual health insurance
coverage provide coverage without cost
sharing for qualifying coronavirus
preventive services. This coverage must
be provided within 15 business days
after the date on which a
recommendation is made by the
USPSTF or ACIP. The Departments also
establish in this IFC that this coverage
must be provided regardless of whether
the service is delivered by an innetwork or out-of-network provider.
The Departments are issuing these
amendments under the authority of
section 9833 of the Code, section 734 of
ERISA, and section 2792 of the PHS Act.
These sections authorize the Secretaries
of the Treasury, Labor, and HHS to
promulgate any interim final rules that
the Secretaries determine are
appropriate to carry out the provisions
of chapter 100 of the Code, part 7 of
subtitle B of title I of ERISA, and part
A of title XXVII of the PHS Act, which
include PHS Act sections 2701 through
2728 and the incorporation of those
sections into ERISA section 715 and
Code section 9815. In addition, section
7805(e) of the Code restricts any
temporary regulation issued by Treasury
and the IRS under the Code, such as
interim final regulations, to a duration
of 3 years.
Several COVID–19 vaccine candidates
are currently in late-stage development.
Once a vaccine is authorized or
approved by FDA, the Departments
expect that ACIP may move
expeditiously to recommend the
immunization. In addition, unlike other
preventive items and services typically
provided according to regularly
scheduled intervals, items and services
intended to prevent or mitigate COVID–
19 will not, in the immediate future, be
provided as part of a usual course of
preventive care. Instead, the
Departments expect consumers to
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receive these services once they are
recommended for the general public or
specific high-risk or high-priority
populations. To help ensure full access
to and the widespread use of qualifying
coronavirus preventive services to
mitigate the PHE for COVID 19, it is
critical that individuals be able to
receive such services from any provider
authorized to provide the service. This
is consistent with the objectives of
Operation Warp Speed, which, as
mentioned above, is a partnership
among components of the Federal
Government that engages with private
firms to accelerate the development,
manufacture, and distribution of a
COVID–19 vaccine to the American
people.
The provisions of this IFC therefore
are immediately necessary to ensure
group health plan and group and
individual health insurance coverage of
these items and services is prompt and
broad, to ensure timely access to combat
the pandemic. In this IFC, the
Department adds a requirement at
§ 417.454 to require section 1876 cost
plans to cover without cost sharing the
COVID 19 vaccine and its
administration described in section
1861(s)(10)(A) of the Act without cost
sharing for the duration of the PHE for
the COVID–19 pandemic, specifically
the end of the emergency period defined
in paragraph (1)(B) of section 1135(g) of
the Act, which is the PHE declared by
the Secretary on January 31, 2020 and
any renewals thereof. While section
1876(c)(2) of the Act ensures that
enrollees in Medicare cost plans will
have coverage of a COVID–19 vaccine
and its administration, section 3713 of
the CARES Act did not amend section
1876 of the Act to provide similar costsharing protections for enrollees in cost
plans who receive the vaccine from an
in-network provider. Currently, there is
no requirement for cost plans to cover
the COVID–19 vaccine and its
administration without cost sharing
(that is, with cost sharing that is the
same as original Medicare) when the
vaccine is furnished by an in-network
health care provider. This provision of
the IFC is immediately necessary to
ensure that cost plan enrollees, like
other Medicare beneficiaries, are
provided access to the COVID–19
vaccine and its administration without
cost sharing. This immediate action will
ensure that cost is not a barrier for
beneficiaries to get the vaccine,
particularly during the public health
emergency when ensuring access is
paramount importance. The delay
necessary for notice and comment
rulemaking is both contrary to the
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public interest and impractical here as
it would delay access to a COVID–19
vaccine without cost sharing and be
contrary to the need to ensure access to
a COVID–19 vaccine for enrollees in
cost plans on the same basis as is
ensured for other Medicare
beneficiaries.
Further, as underscored by the
timeline for coverage Congress
established in section 3203 of the
CARES Act, the need to provide
coverage of qualifying coronavirus
preventive services is urgent. Following
a recommendation of the USPTF or
ACIP, the requirement to provide
coverage without cost sharing of
qualifying coronavirus preventive
services, which are expected to include
immunizations, takes effect within 15
business days. Plans and issuers need
immediate guidance to understand their
obligations under section 3203 of the
CARES Act and to take steps that will
enable them to comply with those
requirements as soon as the coverage
requirement goes into effect. Delaying
these provisions would likewise delay
plans’ and issuers’ ability to prepare for
the availability of a COVID–19 vaccine,
resulting in barriers in access to
coverage of these critical services during
the PHE for COVID–19. As of the date
of display of this regulation, there are
not any coronavirus preventive services
including vaccines for coronavirus that
are required to be covered. However,
because emergency use authorization or
approval of a COVID–19 vaccine may be
imminent, the Departments are of the
view it is critical that these regulations
under section 2713 of the PHS Act be
issued and effective prior to such
authorization or approval. The
Departments are of the view that it
would be impracticable and contrary to
the public interest to undertake normal
notice and comment rulemaking
procedures in light of the urgent need to
ensure coverage of and access to
qualifying coronavirus preventive
services to protect the public health as
well as the health and safety of
individuals and communities to prevent
the spread of COVID–19. For these same
reasons, the Departments are of the view
a delayed effective date would also be
contrary to the public interest. Ensuring
individuals have access to a COVID–19
vaccine as soon as it becomes available
is critical to ending the PHE for COVID–
19, and therefore it is imperative that
these regulations are in effect on the
date such a vaccine becomes available
and recommended by ACIP.
Undertaking the standard rulemaking
process of publishing a proposed rule,
seeking public comment, carefully
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analyzing those public comments, and
subsequently publishing a final rule
would possibly and perhaps likely
jeopardize such an effective date.
The Departments are of the view that
it would be impracticable and contrary
to the public interest to undertake
normal notice and comment procedures
and to thereby delay the effective date
of this IFC. The Departments find good
cause to waive notice of proposed
rulemaking under the APA, 5 U.S.C.
553(b)(B). For those same reasons, as
authorized by section 808(2) of the CRA,
the Departments find it is impracticable
and contrary to the public interest not
to waive the delay in effective date of
this IFC under section 801 of the CRA.
Therefore, the Departments find there is
good cause to waive the CRA’s delay in
effective date pursuant to section 808(2)
of the CRA. The provisions in this IFC
will go into effect on the date of display.
This IFC implements the requirement
that providers of diagnostic tests for
COVID–19 make public their cash prices
for COVID–19 diagnostic tests and
specifies the COVID–19 diagnostic tests
to which this requirement applies. This
IFC further defines ‘‘provider of a
diagnostic test for COVID–19’’ (referred
to as ‘‘provider’’) as any facility that
performs one or more COVID–19
diagnostic tests. In addition, this IFC
defines ‘‘cash price’’ as the charge that
applies to an individual who pays cash
(or cash equivalent) for a COVID–19
diagnostic test. This IFC gives CMS
discretion to take any of the following
actions if CMS determines a provider is
noncompliant with the requirements of
new 45 CFR 182.50:
• Provide a written warning notice to
the provider of the specific violation(s).
• Request that a provider submit and
comply with a CAP.
• Impose a CMP on the provider if the
provider fails to respond to CMS’
request to submit a CAP or to comply
with the requirements of a CAP
approved by CMS.
As indicated above, these
requirements are applicable during the
PHE for COVID–19 (and any extensions
to the PHE for COVID–19); therefore, it
is critically important that we
implement the policies in this IFC as
quickly as possible in order for
stakeholders to know with certainty
during the PHE for COVID–19 how to
comply with the law and what penalties
they will face for noncompliance during
the PHE for COVID–19. Moreover, these
rules are necessary for CMS to enforce
section 3202(b) of the CARES Act and
to ensure plans, issuers, and consumers
know in advance the price for a
diagnostic test for COVID–19 during the
PHE for COVID–19. For these reasons,
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we believe it would be impracticable
and contrary to the public interest to
undertake normal notice and comment
rulemaking procedures and to delay the
effective date of the new requirements
being adopted at 45 CFR part 182.
In this IFC, the Department creates a
New COVID–19 Treatments Add-on
Payment (NCTAP) under the Inpatient
Prospective Payment System (IPPS) for
COVID–19 cases that meet certain
criteria. The Department is of the view
that it would be impracticable and
contrary to the public interest to
undertake normal notice and comment
procedures and to thereby delay the
effective date of this IFC. As drug and
biological products become available
and are authorized or approved by FDA
for the treatment of COVID–19 in the
inpatient setting, there may be potential
financial disincentives for hospitals to
provide these new COVID–19
treatments to Medicare inpatients
during the PHE because the costs of
these new treatments are not yet
reflected in Medicare payment rates and
there are no new technology add-on
payments for these treatments. The
delay necessary for notice and comment
rulemaking is both contrary to the
public interest and impracticable
because of the urgency in ensuring there
are not financial disincentives for
hospitals to provide COVID–19
treatments to beneficiaries during the
PHE. We expect that increasing the
current IPPS payment amounts for
sufficiently costly cases to mitigate
potential financial disincentives for
hospitals to provide new COVID–19
treatments during the PHE will
potentially improve and speed access to
these treatments for Medicare patients.
We also believe that the establishment
of the NCTAP provides greater
transparency and predictability to the
public, including innovators that are
developing new COVID–19 treatments,
as to how Medicare payments for cases
involving these treatments will be
determined when those treatments
become available.
In this IFC, the Department assures
separate payment for new COVID–19
treatments provided in the outpatient
setting for the remainder of the Public
Health Emergency for COVID–19. The
Department is of the view that it would
be impracticable and contrary to the
public interest to undertake normal
notice and comment procedures and to
thereby delay the effective date of this
IFC. We anticipate that most drugs and
biological products authorized or
approved for use in treating COVID–19
in the outpatient setting would be
separately paid under our standard
OPPS payment policy; however, these
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71183
products could be packaged into a
Comprehensive Ambulatory Payment
Classification (C–APC) payment when
provided on the same claim as a C–APC
service, in which case separate payment
would not be made for these products.
Although we do not expect that many
beneficiaries would both receive a
primary C–APC service and a drug or
biological for treating COVID–19, we
nonetheless believe that as drugs or
biologicals become available and are
authorized or approved for the
treatment of COVID–19 in the outpatient
setting, it would be appropriate to
mitigate any potential financial
disincentives for hospitals to provide
these new treatments during the PHE for
COVID–19. The delay necessary for
notice and comment rulemaking to
address this issue is both contrary to the
public interest and impracticable
because of the urgency in ensuring there
are not financial disincentives for
hospitals to provide COVID–19
treatments to beneficiaries. Therefore,
effective for services furnished on or
after the effective date of this rule and
until the end of the PHE for COVID–19,
CMS is creating an exception to its
OPPS C–APC policy to ensure separate
payment for new COVID–19 treatments
that meet certain criteria.
In this IFC, the Department adds
changes to the CJR model that are
immediately necessary to continue the
CJR model consistent with model goals
to, cover inpatient major lower joint
replacements without interruption, and
to reduce operational and financial
uncertainty for CJR hospital participants
during and beyond the PHE. Ending on
March 31, 2021 would be disruptive to
hospitals and patient care during the
PHE. The end date of March 31, 2021,
means hospitals stop initiating episodes
under the model after January 2, 2021,
before the end of the public health
emergency as renewed on October 23,
2020.71 Extending the model through an
additional six months of performance
year (PY) 5, so that PY 5 now ends on
September 30, 2021, provides
participant hospitals with greater
certainty in model operations during the
remainder of the PHE.
Through this IFC we are
implementing four changes to the CJR
model needed to extend PY 5. These
are: (1) Extending PY 5 an additional 6
months to provide for continuity of
model operations with the same scope
while we continue to consider
comments received on our proposal to
extend the model to PYs 6 through 8
and adopt other changes to the model
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(42 CFR 510.2 and 510.200(a)); (2)
making changes to the reconciliation
process for PY 5 to allow for two
periods and to enable more frequent
receipt of reconciliation reports by
participants (42 CFR 510.2, 42 CFR
510.200, 42 CFR 510.305(b), (d)(1), (e),
(i)(1) and (2), and (j)(1) and (2), and 42
CFR 510.400(b)(3)(v), and adding 42
CFR 510.400(b)(3)(vi)); (3) making a
technical change, retroactive to October
1, 2020, to ensure that the model
continues to include the same inpatient
Lower Extremity Joint Replacement
(LEJR) procedures, despite the adoption
of new MS–DRGs to describe those
procedures (42 CFR 510.300(a)(1)(i) and
(iii)); and (4) making changes to the
extreme and uncontrollable
circumstances policy for COVID–19 to
adapt to an increase in CJR episode
volume and renewal of the PHE, while
providing protection against financial
consequences of COVID–19 after the
extreme and uncontrollable
circumstances policy no longer applies
(42 CFR 510.300).
Implementing an additional six
months of PY 5, so that PY 5 now ends
on September 30, 2021 (hospitals stop
initiating new episodes under the model
after July 2, 2021) provides participant
hospitals additional relief and stability
in model operations while the end of
the PHE remains unknown. We have
modified the reconciliation process to
provide payments consistent with the
current annual reconciliation schedule
for hospitals for greater stability. Absent
modification to the reconciliation
process, the extension of PY 5 to a total
of 21 months, from January 1, 2020
through September 30, 2021 would
mean that participant hospitals would
experience a 21-month gap between the
PY4 final reconciliation in June of 2020
and initial PY 5 reconciliation in early
2022. In the FY 2021 IPPS/LTCH final
rule, we stated that because the CJR
model would continue until at least
March 31, 2021, we intended to adopt
a policy in the CJR final rule that
incorporates new MS–DRGs for the
same procedures currently included in
the CJR model, under prior MS–DRGs,
as of their effective date to avoid
disruption to the model for the
remainder of PY5 (as extended) and
thereafter, if our proposal to extend the
CJR model through PY8 were finalized
(85 FR 58502). We are adopting the
change in this IFC, retroactive to
October 1, 2020 because without a
change the model ceases to continue as
a comprehensive joint replacement
model. Not making this change would
have a significant impact on operational
stability. Finally, this interim final rule
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with comment specifies an end for the
current extreme and uncontrollable
adjustment in 42 CFR 510.300(k)(4). In
order to provide participant hospitals
continuing financial protection from the
effect of COVID–19 on the CJR model
that may continue beyond the end of the
PHE for COVID–19 or March 31, 2021,
whichever occurs earlier, we are
implementing that actual episode
payments are capped at the quality
adjusted target price determined for that
episode under § 510.300 for episodes
with actual episode payments that
include a claim with a COVID–19
diagnosis code and initiate after the
earlier of March 31, 2021 or the last day
of the emergency period. This policy is
consistent with flexibilities and
protections for impact of COVID–19 in
other Innovation Center models. For all
of these revisions, we believe it is
contrary to the public interest to
undertake traditional notice and
comment rulemaking to adopt these
regulatory changes because they
preserve the model’s scope and
operations at current levels, fostering
model stability now and in the future
for hospital operations during and
beyond the PHE.
VI. Collection of Information
Requirements
Under the Paperwork Reduction Act
of 1995, the Departments are required to
provide 30-day notice in the Federal
Register and solicit public comment
before a collection of information
requirement is submitted to 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 (PRA) requires
that the Departments solicit comment
on the following issues:
• The need for the information
collection and its usefulness in carrying
out the proper functions of the agency.
• The accuracy of the 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.
The Departments are soliciting public
comment on each of the section
3506(c)(2)(A)-required issues for the
following information collection
requirements (ICRs). The requirements
and burden will be submitted to under
OMB Control Number 0938–NEW.
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A. ICRs for Price Transparency for
COVID–19 Diagnostic Tests
As discussed in section II.C of this
IFC, section 3202(b) of the CARES Act
establishes a requirement to publicize
cash prices for COVID–19 diagnostic
tests during the PHE. For purposes of
implementing section 3202(b) of the
CARES Act, we are adding new 45 CFR
part 182, ‘‘Price Transparency for
COVID–19 Diagnostic Tests,’’ that will
codify price transparency requirements
for the performance of a COVID–19
diagnostic test.
There are several types of COVID–19
tests designed to detect SARS-CoV–2 or
to diagnose a possible case of COVID–
19, including: molecular (RT–PCR) tests,
which are used to detect the virus’s
genetic material; antigen tests, which
are used to detect specific proteins on
the surface of the virus; and serology
testing, which is used to look for the
presence of antibodies produced by the
body in response to infections.
For purposes of 45 CFR part 182, we
are defining ‘‘provider of a diagnostic
test for COVID–19’’ as any facility that
performs one or more COVID–19
diagnostic tests. In order to perform a
diagnostic test for COVID–19 and report
patient-specific results, a facility
(whether that be a primary care
provider’s office, urgent care center,
outpatient hospital site or stand-alone
laboratory) is required to hold a CLIA
certificate based on the complexity of
the testing performed by the facility.
Therefore, we expect that any ‘‘provider
of a COVID–19 diagnostic test’’ would
hold a CLIA certificate (including a
certificate of waiver or certificate of
registration) and that such testing would
occur in facilities ranging from primary
care provider offices to urgent care
centers to stand-alone national
laboratories.
As explained in section VIII.B of this
IFC, we estimate that approximately
83,309 CLIA providers could potentially
be performing COVID–19 diagnostic
tests and need to publicize their cash
prices. For purposes of this IFC, we are
estimating it will take a business
operations specialist (13–1000), on
average 1 hour for a total of 83,309
burden hours to compile and make
public the cash prices for COVID–19
diagnostic tests, at an hourly wage of
$36.31 as published by the BLS in
2019.72 We estimate the overhead and
fringe benefit cost to be 100 percent of
wages. Therefore, we estimate a onetime cost per provider to be $72.62
72 Bureau of Labor Statistics. National
Occupational Employment and Wage Estimates,
May 2019. Available at: https://www.bls.gov/oes/
current/oes_nat.htm#13-0000.
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($36.31 × 2) and the total cost estimated
to be $6,049,900 (83,309 hours × $72.62)
to collect, compile and post the required
information.
B. ICRs for State Innovation Waivers
Policy and Regulatory Revision in
Response to COVID–19 Public Health
Emergency
This IFC provides that states are
required to submit modification
requests to the Secretary of HHS and the
Secretary of the Treasury in order to
obtain approval for the modifications
made available by this IFC. Any state
can submit a request to the Secretaries
for a modification from the state and/or
Federal public notice procedures or
include such a request in their section
1332 waiver application if the waiver
application is submitted during the PHE
for COVID–19. The request must
describe the reason the state seeks a
modification from the state public
notice procedures, describe how the
state meets the modification criteria,
describe the alternative public notice
procedures it proposes to implement at
the state level, including public
hearings, that are designed to provide
the greatest opportunity and level of
meaningful public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the state’s request for a
modification. The request must describe
the reason the state seeks a modification
from the Federal public notice
procedures and the alternative public
notice procedures it requests to be
implemented at the Federal level, as
applicable.
A state with an approved section 1332
waiver can submit a request to HHS and
the Department of Treasury for a
modification from post award public
notice procedures. The request must
specify the reason the state seeks a
modification from the post award public
notice procedures, describe how the
state meets the modification criteria,
and describe the alternative procedures
it proposes to implement at the state
level, including public hearings, that are
designed to provide the greatest
opportunity and level of meaningful
public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the state’s request for a
modification.
While HHS and the Department of
Treasury do not have data available to
predict the number of states that will
likely request a modification of either
the waiver application or the post award
public notice procedures, HHS and the
Department of Treasury estimate it will
take a senior manager 1 hour to prepare
a state’s request, with an equivalent cost
of approximately $118.73 In addition, if
HHS and the Department of Treasury
approve a state’s modification request,
the state will have to post the
71185
determination on their website within
15 days of the approval. HHS and the
Department of Treasury estimate that for
each state, it will take a network and
computer systems administrator 15
minutes to post the approval with an
equivalent cost of approximately $21.74
Assuming that approximately 15 states
will submit a modification request, the
total burden hours for all states will be
15 hours, with an equivalent cost of
approximately $1,775. HHS and the
Department of Treasury have assumed
that 15 states will submit a request
because, as of display of this IFC, 15
states have an approved 1332 waiver.
This is an upper bound, since some
states may not need to request the
available modification for their waivers,
and therefore, will incur no burden.
Furthermore, assuming that
approximately 15 states receive
approval of the modification request
and then must post the approval, the
total burden hours for all states will be
approximately 3.75 hours, with an
equivalent cost of approximately $319.
This is an upper bound, since some
states may not receive approval, and
therefore, will incur a lower (or no)
burden. The total estimated burden
hours assuming approximately 15 states
apply for and receive approval of the
modification request is 18.75 hours,
with an equivalent cost of
approximately $2,094.
TABLE 3—ESTIMATED COST AND BURDEN HOURS PER RESPONDENT
Average
burden hour
per
respondent
(in hours)
BLS occupation
Hourly wage
rates
Total cost per
respondent
Senior Manager ...........................................................................................................................
Network and Computer Systems Administrator ..........................................................................
1
0.25
$118.30
85.02
$118.30
21.26
Total ......................................................................................................................................
1.25
........................
139.56
TABLE 4—ESTIMATED TOTAL COST AND BURDEN FOR ALL RESPONDENTS
Number of
respondents
Number of
responses
Burden hours
per
respondent
Total burden
hours
Total cost
Modification Request ...........................................................
Posting modification approval ..............................................
15
15
15
15
1
0.25
15
3.75
$1,775
319
Total ..............................................................................
15
........................
1.25
18.75
2,094
73 Using data from the Bureau of Labor Statistics
(BLS) for General and Operations Managers (Code
11–1020), we estimate that the average hourly labor
cost will be $118.30, including 100 percent increase
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for overhead and fringe benefits. https://
www.bls.gov/oes/current/oes_stru.htm.
74 Using data from the BLS for Network and
Computer Systems Administrators (Code 15–1244),
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we estimate that the average hourly labor cost will
be $85.02, including 100 percent increase for
overhead and fringe benefits. https://www.bls.gov/
oes/current/oes_stru.htm.
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C. ICRs Regarding the Comprehensive
Joint Replacement (CJR) Model
Section 1115A(d)(3) of the Social
Security Act exempts the Center for
Medicare and Medicaid Innovation
(CMMI) model tests and expansions,
from the PRA. The section provides that
Chapter 35 of title 44, United States
Code, which includes such provisions
as the PRA, shall not apply to the testing
and evaluation of CMMI models or
expansion of such models.
D. ICRs Regarding Enrollment as Mass
Immunization Roster Biller
As discussed in section II.A.1. of this
IFC, a mass immunizer may be enrolled
in Medicare as another type of provider
or supplier such as a physician, nonphysician practitioner, hospital
outpatient department, home health
agency, or skilled nursing facility.
However, an entity that does not
otherwise qualify as a Medicare
provider or supplier but wishes to
furnish mass immunization services
may be eligible to enroll in Medicare as
a ‘‘Mass Immunization Roster Biller’’ via
the Form CMS–855B enrollment
application (Medicare Enrollment
Application: Clinics/Group Practices
and Certain Other Suppliers; OMB
Control No.: 0938–0685; Expires 12/21).
This section discusses our burden
estimates for the enrollment of mass
immunization roster billers via the Form
CMS–855B application as well as the
PRA exemption we are claiming for the
appeals process.
1. Cost of Completing Form CMS–855B
Using our internal data, we generally
estimate that approximately 60,000
entities (the preponderance of which
will be pharmacies) will seek to enroll
as mass immunization roster billers
pursuant to the IFC, all of whom will
attempt enrollment in the 12-month
period following the IFC’s display.
According to the most recent wage data
provided by the Bureau of Labor
Statistics (BLS) for May 2019 (see https://
www.bls.gov/oes/current/oes_nat.htm),
the mean hourly wages for the following
categories are:
TABLE 5—NATIONAL OCCUPATIONAL EMPLOYMENT AND WAGE ESTIMATES
Occupation
code
Occupation title
Healthcare Diagnosing or Treating Practitioners .............................................
Medical Secretaries and Administrative Assistants .........................................
29–1000
43–6013
Consistent with Form CMS–855B
projections made in recent rulemaking
efforts, it will take each entity an
average of 2.5 hours to obtain and
furnish the information on the Form
CMS–855B. Per our experience, the
entity’s medical secretary will secure
and report this data, a task that would
take approximately 2 hours.
Additionally, a health diagnosing and
treating practitioner of the entity will
review and sign the form, a process we
estimate takes 30 minutes. We therefore
project a total burden of 150,000 hours
(60,000 suppliers × 2.5 hrs) at a cost of
$7,350,000 (60,000 suppliers × ((2 hrs ×
$36.62/hr) + (0.5 hrs × $98.52/hr)).
When averaged over the typical 3-year
OMB approval period, we estimate an
annual burden of 50,000 hours (150,000
hrs/3) at a cost of $2,450,000
($7,350,000/3).
developed burden estimates. We also
believe that any costs associated with
mass immunization roster biller
enrollment will, in any event, be de
minimis; this is because we anticipate,
based on past experience, there would
be comparatively few denials and
revocations of such enrollments.
2. Appeals
Regulatory Impact Analysis
Pursuant to 42 CFR part 498, a mass
immunization roster biller may appeal
the denial or revocation of its
enrollment. While there are information
collection requirements associated with
the appeals process, we believe they are
exempt from the PRA. In accordance
with the implementing regulations of
the PRA at 5 CFR 1320.4(a)(2), the
information collection requirements
associated with the appeals process are
subsequent to an administrative action
(specifically, the denial or revocation of
a mass immunization roster biller’s
enrollment). Therefore, we have not
A. Statement of Need
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Response to Comments
Because of the large number of public
comments normally received on Federal
Register documents, the Departments
are not able to acknowledge or respond
to them individually. All comments
received by the date and time specified
in the DATES section of this preamble
will be considered, and, when the
Departments proceed with a subsequent
document, the Departments will
respond to the comments in the
preamble to that document.
The flexibilities and changes
contained within this IFC are responsive
to the PHE for COVID–19. The policies
implemented in this IFC will provide
flexibilities, during the PHE for COVID–
19, to states pursuing waivers under
section 1332 of the PPACA and to states
with approved section 1332 waivers.
Additionally, the policies and
regulatory updates implemented in this
IFC will increase the affordability with
regards to section 1332 waiver
applications and support continuity of
health insurance coverage for
PO 00000
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Mean hourly
wage
($/hr)
Fringe benefits
and overhead
($/hr)
49.26
18.31
49.26
18.31
Adjusted
hourly wage
($/hr)
98.52
36.62
consumers in the individual and small
group (or merged) market during the
PHE for COVID–19. This IFC also
implements section 3202(b) of the
CARES Act, which requires that
providers of COVID–19 diagnostic tests
make public their cash prices for those
tests and establishes an enforcement
scheme to enforce those requirements
during the PHE for COVID–19.
In section 3203 of the CARES Act,
Congress required group health plans
and issuers of group or individual
health insurance coverage to cover
without cost sharing qualifying
coronavirus preventive services, and
required such coverage to be provided
within 15 business days after the date
on which an applicable
recommendation is made relating to
such service. The Departments codify
these requirements in this IFC, and
finalize amendments to the regulations
implementing section 2713 of the PHS
Act at 26 CFR 54.9815–2713; 29 CFR
2590.715–2713; and 45 CFR 147.130
that are intended to help ensure full
access to and the widespread use of
qualifying coronavirus preventive
services to mitigate the public health
emergency.
B. Overall Impact
The Departments have examined the
potential impacts of this rule as required
by Executive Order 12866 on Regulatory
Planning and Review (September 30,
1993), Executive Order 13563 on
Improving Regulation and Regulatory
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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), Executive Order 13132 on
Federalism (August 4, 1999), the
Congressional Review Act (5 U.S.C.
804(2)), and Executive Order 13771 on
Reducing Regulation and Controlling
Regulatory Costs (January 30, 2017).
Executive Orders 12866 and 13563
direct agencies to assess all costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). Section 3(f) of Executive Order
12866 defines a ‘‘significant regulatory
action’’ as an action that is likely to
result in a rule: (1) Having an annual
effect on the economy of $100 million
or more in any one year, or adversely
and materially affecting a sector of the
economy, productivity, competition,
jobs, the environment, public health or
safety, or state, local or tribal
governments or communities (also
referred to as ‘‘economically
significant’’); (2) creating a serious
inconsistency or otherwise interfering
with an action taken or planned by
another agency; (3) materially altering
the budgetary impacts of entitlement
grants, user fees, or loan programs or the
rights and obligations of recipients
thereof; or (4) raising novel legal or
policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
Order.
A regulatory impact analysis (RIA)
must be prepared for major rules with
economically significant effects ($100
million or more in any one year), and
a ‘‘significant’’ regulatory action is
subject to review by the OMB. The
Departments have determined that these
rules are likely to have economic
impacts of $100 million or more in at
least one year, and thus, meet the
definition of ‘‘economically significant’’
under Executive Order 12866 and a
major rule under the Congressional
Review Act. Therefore, the Departments
have provided an assessment of the
potential costs, benefits, and transfers
associated with this rule. In accordance
with the provisions of Executive Order
12866, this regulation was reviewed by
OMB.
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C. Detailed Economic Analysis
1. Effect of Price Transparency for
COVID–19 Diagnostic Tests During the
PHE
As discussed in section II.C of this
IFC, Section 3202(b) of the CARES Act
establishes a requirement to publicize
cash prices for COVID–19 diagnostic
tests during the PHE. For purposes of
implementing section 3202(b) of the
CARES Act, we are adding new 45 CFR
part 182, ‘‘Price Transparency for
COVID–19 Diagnostic Tests,’’ that will
codify price transparency requirements
for the actual performance of a COVID–
19 diagnostic test. At § 182.20, we are
defining a ‘‘COVID–19 diagnostic test’’
as a COVID–19 in vitro diagnostic test
described in section 6001 of the FFCRA,
as amended by section 3201 of the
CARES Act.
This IFC defines a ‘‘provider of a
diagnostic test for COVID–19’’ (referred
to as ‘‘provider’’) as any facility that
performs one or more COVID–19
diagnostic tests. In order to perform a
COVID–19 diagnostic tests and report
patient-specific results, a facility is
required to hold a CLIA certificate based
on the complexity of the testing
performed by the facility. This IFC
requires providers of COVID–19
diagnostic tests to make public the cash
price for such tests on a public internet
website of such provider during the
emergency period declared under
section 319 of the PHS Act. In the event
that a provider does not have its own
website on which to post this cash price
information, § 182.40(b) states that the
provider would be required to make
public its cash price information in
writing, within two business days upon
request, and by posting signage
prominently at the provider’s COVID–19
diagnostic testing location, if such
location is accessible to the public.
We anticipate that price transparency
has potential beneficial marketplace
benefits generally, as discussed in detail
in the CY 2020 Hospital Outpatient PPS
Policy Changes and Payment Rates and
Ambulatory Surgical Center Payment
System Policy Changes and Payment
Rates, Price Transparency Requirements
for Hospitals To Make Standard Charges
Public Final Rule (84 FR 65524) and the
Transparency in Coverage Proposed
Rule (84 FR 65464). As noted in section
II.C of this IFC, section 3202 of the
CARES Act addresses reimbursement of
COVID–19 diagnostic tests. Section
3202(a) of the CARES Act requires
group health plans and issuers that
provide coverage for items and services
described in section 6001(a) of the
FFCRA to reimburse any provider of a
COVID–19 diagnostic test an amount
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71187
that equals the negotiated rate, or, if the
plan or issuer does not have a
negotiated rate with the provider, the
cash price for such service that is listed
by the provider on a public website. We
anticipate that price transparency in
COVID–19 diagnostic testing, in
particular, will help improve clarity for
consumers and the plans and issuers
that are required to cover the cost of
performing a COVID–19 diagnostic test
when there is no negotiated rate
between the plan or issuer and the
provider. For individuals without
insurance and for health plans and
health insurance issuers attempting to
negotiate a rate for performance of a
COVID–19 diagnostic test with a
provider that has posted its cash price,
that cash price could provide some
context and a baseline against which
those negotiations can occur. Moreover,
price transparency in COVID–19
diagnostic tests will assist the uninsured
in determining the cash price at various
providers when price shopping for
COVID–19 diagnostic tests.
Assessments of broader transparency
policies yield per-capita estimates of
annual expenditure reductions ranging
from between $3 and $5 (= $2.8 million
+ $1.3 million + $7.0 million + $2.3
million two-year savings, across 1.3
million California public employees and
their family members, per Boynton and
Robinson (2015)), to $6.50 (= $7.9
million + $36 million five-year savings
found by Brown (2018), divided across
the 1.36 million residents of New
Hampshire), to $17 (= $13.2 million
three-year savings across 0.26 million
beneficiaries, per Rhoads (2019)).75 If
the $6.50 median result is extrapolated
from the context of general health
spending—which is approximately
$10,000 per capita in the United
States—to a range of between $60 and
$1,200 in COVID–19 diagnostic testing
(= $60 per test, across between one and
20 tests), the estimate of rule-induced
reductions in annual consumer
expenditures could range from $13
million to $254 million. (This
expenditure change combines transfers
(to patients or insurers from providers)
75 Boynton, A., and Robinson, J. ‘‘Appropriate
Use of Reference Pricing Can Increase Value.’’
Health Affairs Blog. July 7, 2015. Available at:
https://www.healthaffairs.org/do/10.1377/
hblog20150707.049155/full/. Brown, Z. Y.
‘‘Equilibrium Effects of Health Care Price
Information.’’ 100 Rev. of Econ. and Stat. 1. July 16,
2018. Available at: https://www-personal.umich.edu/
∼zachb/zbrown_eqm_effects_price_
transparency.pdf. Rhoads, J. ‘‘Right to Shop for
Public Employees: How health care incentives are
saving money in Kentucky.’’ The Dartmouth
Institute for Health Policy and Clinical Practice.
March 8, 2019. Available at: https://thefga.org/wpcontent/uploads/2019/03/RTS-KentuckyHealthCareIncentivesSavingMoney-DRAFT8.pdf.
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Federal Register / Vol. 85, No. 216 / Friday, November 6, 2020 / Rules and Regulations
with potential societal resource cost
savings; only the latter portion should
be compared against estimates of the
provision’s administrative and
paperwork costs.) We note, however,
that this estimate is based on annual
expenditure reductions; because this
requirement is only applicable for the
remainder of the PHE, which may be
less than a year, the saving impact is
likely to be lower.
To comply with the regulatory
updates in this IFC, providers would
need to review their billing practices
and determine their ‘‘cash price’’ for
COVID–19 diagnostic tests. They would
further need to publicly post the cash
prices for all COVID–19 diagnostic tests
along with associated plain language
descriptions and HCPCS or CPT billing
codes. The provider would be required
to make all of this information public on
the provider’s internet website. As
discussed in section VI.C, we estimate it
would take a Business Operations
Specialist, on average 1 hour to compile
and make public the cash prices for the
COVID–19 diagnostic tests that the
facility offers at an hourly wage of
$36.31 as published by the 2019 Bureau
of Labor Statistics.76 We estimate the
overhead and fringe benefit cost to be
100 percent of wages. Therefore, we
estimate a one-time cost per provider to
be $72.62 (36.31 × 2).
We expect that approximately 30
percent 77 (n = 83,309) of the total CLIAcertified laboratories (n = 277,699 78)
could potentially be performing COVID–
19 diagnostic tests and need to publicize
their cash prices in such form and
manner as prescribed in new 45 CFR
part 182 during the PHE for COVID–19,
including any subsequent renewals. The
total cost is estimated to be $ $6,049,900
(83,309 hours × $72.62) to collect,
compile and post the required
information.
We seek comment on the burden
estimate for providers of a diagnostic
test for COVID–19, specifically the
number of burden hours estimated to
post their cash price for COVID–19
diagnostic test.
76 Bureau of Labor Statistics. National
Occupational Employment and Wage Estimates,
May 2019. Available at: https://www.bls.gov/oes/
current/oes_nat.htm#13-0000.
77 Consistent with the percent of laboratories
required to report COVID–19 diagnostic test results
in CMS–3401–IFC.
78 As of October 11, 2020, according to the
Certification and Survey Provider Enhanced
Reporting system this includes Certificate of Waiver
(210,669), Certificate of Provider-Performed
Microscopy (31,992), Certificate of Compliance
(19,044) and Certificate of Accreditation (15,994).
Available at: https://qcor.cms.gov/CLIA_
wizard.jsp?which=4&report=active_CLIA.jsp.
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2. Effects of Medicare Inpatient
Prospective Payment System (IPPS)
New COVID–19 Treatments Add-on
Payment (NCTAP) for the Remainder of
the Public Health Emergency (PHE)
As drug and biological products
become available and are authorized or
approved by FDA for the treatment of
COVID–19 in the inpatient setting, there
may be potential financial disincentives
for hospitals to provide these new
COVID–19 treatments to Medicare
inpatients during the PHE because the
costs of these new treatments are not yet
reflected in Medicare payment rates and
there are no new technology add-on
payments for these treatments. We
expect that increasing the current IPPS
payment amounts for sufficiently costly
cases to mitigate potential financial
disincentives for hospitals to provide
new COVID–19 treatments during the
PHE will potentially improve and speed
access to these treatments for Medicare
patients. We also believe that the
establishment of the NCTAP provides
greater transparency and predictability
to the public, including innovators that
are developing new COVID–19
treatments, as to how Medicare
payments for cases involving these
treatments will be determined when
those treatments become available.
Given it is unknown what the cost
and utilization of inpatient stays using
these new treatments will be, the net
overall cost of the NCTAP policy is not
estimable. On one extreme, if all of the
new COVID–19 treatments decrease the
net cost of hospitalizations (for example,
due to shortened lengths of stay),
including the cost of the new treatment,
below the Medicare payment as
increased by section 3710 of the CARES
Act then there would be no NCTAP
payments made and no additional cost
to the Medicare program as a result of
this policy. On the other extreme, if all
of the new COVID–19 treatments result
in the net cost of hospitalizations that
exceed the outlier threshold (for
example, due to the cost of the new
treatment), the cost to the Medicare
program would be the sum over all
NCTAP cases of 0.65 times the outlier
threshold for each case.
3. Effects of the Medicare Outpatient
Prospective Payment System (OPPS)
Separate Payment for New COVID–19
Treatments Policy for the Remainder of
the Public Health Emergency (PHE) for
COVID–19
This IFC provides for separate
payment for New COVID–19 Treatments
under the Outpatient Prospective
Payment System (OPPS) for the
remainder of the PHE for COVID–19
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when these treatments are provided at
the same time as a Comprehensive
Ambulatory Payment Classification (C–
APC) service. As we noted in Section
II.E.2, we believe it would be a fairly
rare occurrence that an outpatient
department would perform a C–APC
procedure on a beneficiary being treated
for COVID–19 because most C–APCs are
for surgical or other intensive
procedures and we would expect most
hospital outpatients departments would
not perform outpatient surgery on a
patient that has an active case of
COVID–19. While it is possible that
future COVID–19 treatments that are
authorized or approved for use in the
outpatient setting might be administered
to patients under observation while the
provider determines if the patient needs
to be admitted to the hospital for
COVID–19, it is our expectation that this
hypothetical situation would not
happen frequently. Because we believe
a new COVID–19 treatment will rarely
be provided on the same claim as a
primary C–APC service, we believe new
COVID–19 treatments used in the
outpatient setting will be separately
paid under current policy the vast
majority of the time. As a result, we
believe any budgetary effect of this new
exception is likely to be de minimis.
4. Effects of Temporary Increase in
Federal Medicaid Funding
This IFC interprets the requirement in
section 6008(b)(3) of the FFCRA that
states maintain Medicaid beneficiary
enrollment as a condition of receiving
the temporary FMAP increase described
at section 6008(a) of the FFCRA. This
IFC provides states with greater
flexibility than current CMS guidance to
transition beneficiaries between
eligibility groups, to modify the amount,
duration, and scope of coverage
available to beneficiaries, and to make
changes to applicable cost sharing and
beneficiary liability. At the same time,
this IFC protects beneficiary access to
medical assistance by requiring states to
maintain each beneficiary’s coverage in
one of three tiers, thereby protecting
access to the basic coverage a
beneficiary was receiving as of or after
March 18, 2020.
We anticipate that this IFC will result
in lessened financial burden on state
Medicaid agencies and the Federal
Government as compared to CMS’s
existing interpretation of the FFCRA
6008(b)(3) requirement. It would be
highly challenging to estimate specific
cost savings resulting from this IFC
because such an estimate would be
almost entirely dependent on state
behavior under the unique
circumstances of the PHE for COVID–
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19. First, we believe that some savings
may result from transitioning
beneficiaries to different eligibility
groups with greater cost sharing or
beneficiary liability. However, we know
that states have faced both system and
operational constraints that may prevent
them from processing routine actions,
such as transitioning a beneficiary from
one group to another following a change
in circumstances. A state that has been
processing eligibility renewals and
redeterminations during the PHE may
be able to make such transitions
relatively quickly, while a state that has
been unable to process changes without
violating the requirements for receiving
the temporary FMAP increase may need
more time to begin transferring
beneficiaries between groups.
Second, we anticipate that states will
implement the new flexibilities offered
by this rule in a variety of ways and to
different degrees. States may, for
example, look for cost savings through
the elimination of an optional benefit,
establishing new copayments for
services that are unrelated to the PHE,
or increasing beneficiary liability for
institutional care through a reduction to
the personal needs allowance. Because
each state’s financial situation is unique
and the characteristics of each Medicaid
program are different, it is difficult to
predict how states will respond to this
IFC. While one state may elect to
implement just one cost saving
flexibility, another state may utilize all
available options, and yet another state
may elect not to make any program
changes. Based on the recent feedback
we have received from states, we do
anticipate that some states will
implement some of these cost saving
measures, which will result in
decreased financial burden for states
and cost savings for the Federal
Government.
While our current interpretation of
section 6008(b)(3) of the FFCRA
provides the strongest protections for
beneficiary access to coverage, the
safeguards established by this IFC will
ensure that all beneficiaries maintain
the same basic level of access to
coverage that they were receiving as of
or after March 18, 2020. All
beneficiaries who had access to
minimum essential coverage will
maintain access to such coverage, and
every beneficiary who had access to
testing services and treatment for
COVID–19, including vaccines, will
retain such access. Individual
beneficiaries may be required to pay
cost sharing that they were not
previously charged (except with respect
to testing and treatment services related
to COVID–19, which states cannot
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charge under section 6008(b)(4) of the
FFCRA if they are claiming the
temporary FMAP increase), or they may
need to meet additional prior
authorization or medical necessity
requirements.
5. Effects of Updates to the
Comprehensive Care for Joint
Replacement (CJR) Model, Performance
Year (PY) 5 During the PHE
The evolving impact of the PHE for
the COVID–19 has created difficulties in
forecasting the state of the LEJR market
for 2021. For example, Table 1 indicates
CJR episode volume increasing and
moving back toward traditional levels
from April to June, but then decreasing
again in July and August. It is difficult
to predict the impact of extending PY 5
an additional 6 months with the
amended policies described above
because there exists a potential for
variation between PY 5 target prices and
PY 5 actual episode costs (as a result of
COVID–19) which creates uncertainty in
calculating anticipated net
reconciliation amounts for PY 5. As a
result, the Office of the Actuary was
unable create projections regarding
Medicare program spending in 2021 for
MS–DRGs 469, 470, 521, or 522 or
discrete impact estimates regarding the
effect of extending CJR PY 5 an
additional 6 months with the amended
policies described above. In assessing
the potential cost or savings for this
extension, CMMI internal analysis
considered the following data points.
First, the Second Annual CJR Evaluation
Report,79 indicates participant hospitals
reduced spending by 3.7 percent
(difference in claims) during the first 2
years of the CJR model. Additionally, if
the episode definition policy were not
amended to include the new MS–DRGs
and fracture episodes were no longer
included in the CJR episode definition
October 1, 2020—March 31, 2021,
episode volume would decrease
significantly and the cost saving effect
of the CJR model would be limited to
only non-fracture episodes, which are
generally the less costly episodes. We
also know that while the CJR model
achieves program savings, this
observation is not net of reconciliation
payments and administrative costs.
Further, our February 2020 proposed
rule (85 FR 10516) proposes payment
methodology revisions to the target
price methodology to improve payment
accuracy as the current methodology
tends to excessive payment. Given the
79 CMS Comprehensive Care for Joint
Replacement Model: Performance Year 2 Evaluation
Report Available at https://innovation.cms.gov/
files/reports/cjr-secondannrpt.pdf.
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71189
confluence of factors affecting
payments, including episode volume,
actual episode costs, and even target
prices, we cannot confidently estimate
cost or savings associated with the CJR
model changes in this final rule,
specifically, the provisions: to add
reconciliation periods to PY 5, to add
MS–DRGs 521 and 522 to the episode
definition, to change the extreme and
uncontrollable circumstances policy,
and to extend PY5 6 months. We will
continue to refine this analysis. If the
February 2020 proposed rule is finalized
after review and response to comment,
we will strive to provide a more detailed
estimate for future model performance
years.
6. Effects of Rapid Coverage of
Preventative Services for Coronavirus
This IFC requires that nongrandfathered group health plans and
health insurance issuers offering nongrandfathered group or individual
health insurance coverage provide
coverage for qualifying coronavirus
preventive services, including
recommended COVID–19
immunizations and their
administration, without any cost
sharing. It also requires plans and
issuers to provide coverage within 15
business days after the date on which an
applicable recommendation is made by
USPSTF or ACIP relating to such a
service. In addition, it requires that
during the PHE for COVID–19 a group
health plan or issuer that has a network
of providers to provide coverage
without cost sharing regardless of
whether the service is delivered by an
in-network or out-of-network provider.
Making these qualifying coronavirus
preventive services, including COVID–
19 immunizations, available without
any delay is in the interest of public
health, as making these services
available as quickly as possible may
encourage individuals to take advantage
of these services and therefore may slow
the transmission of COVID–19. Access
to qualifying coronavirus preventive
services without cost sharing will
encourage more individuals to obtain
them. Increased use of qualifying
coronavirus preventive services may
reduce the transmission and spread of
the disease and thus potentially result
in better overall health outcomes. In the
immediate term, newly developed
qualifying coronavirus preventive
services might be available from a
narrower range of providers than other,
more established recommended
preventive items and services. If
COVID–19 immunizations require
specialized storage and administration
services, only a limited number of
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providers may be able to offer them at
first. If consumers have to incur
additional burdens, long wait times, and
increased travel times to find an innetwork provider that can provide such
services, it will limit access and
discourage them from obtaining such
services. Therefore, the Departments are
of the view that requiring out-ofnetwork coverage without cost sharing
for qualifying coronavirus preventive
services will help ensure that
consumers are able to obtain the
preventive services without cost sharing
as soon as possible.
Plans and issuers will incur the cost
of the qualifying coronavirus preventive
services and administration of such
services. Providing coverage within 15
business days after a recommendation is
made relating to such services is likely
to impose significant administrative
costs on issuers, group health plans, and
other service providers to update
systems to include billing codes for the
preventive services, negotiate prices
with network providers, determine
reimbursements for out-of-network
providers, and conduct outreach to
providers, participants, beneficiaries,
and enrollees in a very short time
period. Depending on the magnitude of
the costs of qualifying coronavirus
preventive services and administration
of such services relative to the potential
cost of treatment for the disease, this
may have an impact on premiums.
There are uncertainties regarding the
price of potential qualifying coronavirus
preventive services, including COVID–
19 immunizations. If the prices are high
and there is widespread use of such
services, premiums may increase. If the
timing of availability of the preventive
services is such that plans and issuers
are unable to take them into account
when setting premiums, it may result in
lower profits or losses for plans and
issuers. The costs to plans and issuers
will be lower if a third party, such as the
Federal Government, covers the cost of
the immunizations. In addition, the
costs associated with providing
coverage for qualifying coronavirus
preventive services may be offset by
savings from avoidance of treatment for
COVID–19.
During the PHE for COVID–19, costs
to group health plans or issuers that
have networks of providers will be
higher if a significant number of
participants, beneficiaries, or enrollees
go to out-of-network providers, and the
issuers and plans reimburse those outof-network providers at higher levels
than their negotiated rate with innetwork providers. However, if
consumers can obtain the qualifying
coronavirus preventive services where
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they usually obtain health care services,
consumers are likely to receive the
services from an in-network provider.
Plans and issuers may also wish to
educate participants, beneficiaries, or
enrollees about the availability of the
services from in-network providers and
encourage them to obtain these services
from their usual providers. This
approach could limit the number of
participants, beneficiaries, or enrollees
going to out-of-network providers
instead of staying in network, but there
will be associated administrative
burdens and costs.
The total cost to plans and issuers
related to qualifying coronavirus
preventive services that are
immunizations will depend on the cost
and number of required immunization
doses to be administered, the number of
people who will choose to get
immunized against COVID–19 and
which providers will be able to provide
the preventive services. For the 2018–19
influenza season, 62.6 percent of
children 6 months through 17 years and
45.3 percent of adults 18 years and older
obtained the influenza vaccine.80 Given
the severity of COVID–19, the
Departments anticipate the
immunization rates for COVID–19 are
likely to ultimately be higher than for
influenza, although initial rates may be
lower until an adequate supply is
available. Total costs to plans and
issuers will depend on the cost of
covering qualifying coronavirus
preventive services, the number of
people choosing to obtain such services,
and whether a third party such as the
Federal Government covers the costs of
any immunizations.
The Departments seek comment on
any potential costs and burdens that
may be incurred by plans and issuers
due to the requirements to cover the
costs and administration of such
qualifying coronavirus preventive
services without any cost sharing
regardless of whether the service is
delivered by an in-network or out-ofnetwork provider. The Departments also
seek comment on the potential effects
and costs consumers may face as a
result of this provision.
7. Effects of Changes to State Innovation
Waivers Policy and Regulatory
Revisions in Response to the COVID–19
Public Health Emergency
This IFC establishes a framework for
states to request the Secretary of HHS
and the Secretary of the Treasury to
80 See Flu Vaccination Coverage, United States,
2018–19 Influenza Season. Center for Disease
Control and Prevention, available at https://
www.cdc.gov/flu/fluvaxview/coverage1819estimates.htm.
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modify, in part, the public notice
procedures outlined in 31 CFR 33.112
and 33.116 and 45 CFR 155.1312 and
155.1316 to expedite a decision on a
proposed section 1332 waiver request
during the PHE for COVID–19.
Regulations at §§ 33.112 and 155.1312
require a state to provide a public notice
and comment period at the state level
prior to submitting an application for a
section 1332 waiver. The regulations at
§§ 33.116 and 155.1316 establish
Federal public notice requirements for
state section 1332 waiver applications.
This IFC also establishes a framework at
the new 31 CFR 33.120(c)(2) and 45 CFR
155.1320(c)(2) for states to request the
Secretaries to modify, in part, the post
award public notice procedures
outlined in §§ 33.120(c) and 155.1320(c)
for an approved waiver that would
otherwise take place or become due
during the PHE for COVID–19. As stated
above, HHS and the Department of the
Treasury are of the view that requiring
states that meet the criteria outlined in
this IFC to comply with the full public
notice procedures during the PHE for
COVID–19 could cause undue harm to
the public. Allowing the Secretaries to
modify, in part, these requirements will
enable states to request and receive
approval for waiver requests more
quickly and also implement changes
that will provide consumers with access
to affordable health insurance coverage
during the current PHE for COVID–19.
States that request modifications from
the public notice procedures will incur
some burden, as discussed in the
Collection of Information Requirements
section. For a state that requests and
receives a modification of the public
notice procedures, we acknowledge that
consumers may receive less prior notice
than would occur without the
modification. Through this IFC, the
HHS and the Department of Treasury
intend to provide an appropriate
balance and permit flexibility where a
state can ensure a sufficient opportunity
for meaningful public input given the
circumstances in the PHE for COVID–19
while also ensuring the safety of the
public. If a state’s modification request
is approved there may be a shorter
comment period at the state or Federal
level, or the comment periods may be
the same number of days (for example
30 days) but perhaps on a different
timeframe. For example, a state may
conduct the state public comment
period concurrently with the Federal
public comment period instead of
before. States with approved
modification requests may experience a
reduction in costs related to post award
public notice procedures. However, if
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the state’s modification request is
approved, the state must also implement
alternative public notice procedures
and, if required, amend the waiver
application to specify that it is the
state’s intent to comply with those
alternative public notice requirements
in the state’s modification request.
States may also need to employ
additional technologies to host virtual
hearings instead of in person gatherings.
In this case, there may be no reduction
in costs related to public notice
procedures.
HHS and the Department of the
Treasury seek comment on any potential
costs and burdens that may be incurred
by states due to the flexibilities afforded
in this IFC. HHS and the Department of
the Treasury also seek comment on the
potential effects and costs consumers
may face as a result of a state’s action
taken as a result of the flexibilities in
this IFC.
8. Effects of Medicare Coding and
Payment for COVID–19 Vaccine
This IFC discusses CMS’s
implementation of section 3713 of the
CARES Act (Pub. L. 116–136), which
established Medicare Part B coverage
and payment for a COVID–19 vaccine
and its administration. This IFC requires
that Medicare provide coverage for
qualifying COVID–19 vaccines
administration, without any cost
sharing. Making COVID–19 vaccines,
available without any delay is in the
interest of public health, as making
these services available as quickly as
possible may encourage individuals to
take advantage of these services and
therefore may slow the transmission of
COVID–19. Access to COVID–19
vaccines without cost sharing will
encourage more individuals to obtain
them. In the immediate term, any newly
developed COVID–19 vaccines might be
available from a narrower range of
providers than other, more established
recommended preventive items and
services. If COVID–19 vaccines require
specialized storage and administration
services, only a limited number of
providers may be able to offer them at
first. If beneficiaries have to incur
additional burdens, long wait times, and
increased travel times to find Medicare
providers and suppliers that can
provide such services, it will limit
access and discourage them from
obtaining such services. Medicare
providers and suppliers will incur costs
for providing COVID–19 vaccines and
administration of such services. There
are uncertainties regarding the cost to
the Medicare program for COVID–19
vaccines and administration at this
time. The total cost to Medicare related
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to COVID–19 vaccines and
administration cost are dependent on
and the number of required
immunization doses to be administered,
the number of people who will choose
to get immunized against COVID–19
and which providers and suppliers will
be able to provide the preventive
services.
9. Effects of Application Fee as Part of
Form CMS–855B Enrollment as Mass
Immunization Roster Biller
Consistent with § 424.514, an entity
enrolling in Medicare as a mass
immunization roster biller via the Form
CMS–855B must pay an application fee
at the time of enrollment. The
application fees for each of the past 3
calendar years were or are $569 (CY
2018), $586, (CY 2019), and $595 (CY
2020). The differing fee amounts are
predicated on changes/increases in the
Consumer Price Index (CPI) for all urban
consumers (all items; United State city
average, CPI–U) for the 12-month period
ending on June 30 of the previous year.
Although we cannot predict future
changes to the CPI, the fee amounts
between 2018 and 2020 increased by an
average of $13 per year. We believe this
is a reasonable barometer with which to
establish a CY 2021 fee estimate (strictly
for purposes of this IFC) of $608.
Applying this prospective fee amount
to the previously mentioned 60,000
projected mass immunization roster
biller applicants in the first year of this
rule, we estimate a total application fee
cost to enrollees of $36,400,000 (or
60,000 × $608). This represents a
transfer from mass immunizer suppliers
to the Federal Government.
D. Regulatory Alternatives Considered
The Department considered not
implementing the changes to the CJR
model but determined the effect of the
changes, particularly relief from
financial risk for COVID–19 cases and
stability in model operations, to be very
important for participant hospitals
during the PHE. Further, if the threeyear extension of the CJR model is
finalized, it would be much more
difficult for participant hospitals to stop
model value-based operations, and then
restart value operations when hospitals
already have significant burden
managing COVID–19 treatment and
under COVID–19 safety protocols and
utilization changes.
The Departments considered not
requiring plans and issuers to provide
coverage for qualifying coronavirus
preventive services without cost sharing
from out-of-network providers.
However, in the near term, newly
developed qualifying coronavirus
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71191
preventive services might be available
from a narrower range of providers than
other, more established recommended
preventive services because of
specialized storage and administration
requirements. If there are only a limited
number of in-network providers that can
administer these services, consumers
may incur additional burden related to
travel and long wait times to obtain
these services, which can result in lower
utilization. The Departments are
concerned that allowing plans and
issuers to impose cost sharing for
COVID–19 immunizations provided by
out-of-network providers would
discourage individuals from seeking
immunization, potentially leading to
reduced administration of any COVID–
19 vaccine and prolonging the PHE for
COVID–19, contrary to the intent of the
CARES Act. In order to ensure that the
immunization services will be available
to all consumers enrolled in nongrandfathered group health plans and
non-grandfathered group and individual
health insurance coverage, the
Departments are therefore requiring
such plans and issuers to cover without
cost sharing a qualifying coronavirus
preventive service, regardless of
whether such service is delivered by an
in-network or out-of-network provider.
The Departments anticipate that as such
services become more widely available
over time, consumers will be able to
obtain them more easily from innetwork providers.
HHS and the Department of the
Treasury considered providing states
with the flexibility to waive all of the
public notice procedures outlined in 31
CFR 33.112 and 33.116 and 45 CFR
155.1312 and 155.1316 to expedite a
decision on a proposed section 1332
waiver request during the PHE for
COVID–19. This approach would have
allowed a state to request to completely
eliminate a public notice or reporting
requirement pre- or post-award.
However, HHS and the Department of
the Treasury were concerned that that
this would violate the statutory
requirements regarding a meaningful
level of input from the public. In
addition, HHS and the Department of
Treasury are committed to transparency
and value public input on waiver
proposals and value public feedback to
ensure consumers are aware of waiver
proposals that may affect them. HHS
and the Department of the Treasury
anticipate working with states on their
modification request to ensure the
public is provided the opportunity to
provide feedback on waiver proposals
and the progress of the program
authorized by the section 1332 waiver.
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E. Regulatory Flexibility Act
The Regulatory Flexibility Act, (5
U.S.C. 601, et seq.), requires agencies to
analyze options for regulatory relief of
small entities to prepare an initial
regulatory flexibility analysis to
describe the impact of the proposed rule
on small entities, unless the head of the
agency can certify that the rule will not
have a significant economic impact on
a substantial number of small entities.
The RFA generally defines a ‘‘small
entity’’ as (1) a proprietary firm meeting
the size standards of the Small Business
Administration (SBA), (2) a not-forprofit organization that is not dominant
in its field, or (3) a small government
jurisdiction with a population of less
than 50,000. States and individuals are
not included in the definition of ‘‘small
entity.’’ HHS uses a change in revenues
of more than 3 to 5 percent as its
measure of significant economic impact
on a substantial number of small
entities. For purposes of the RFA, small
entities include small businesses,
nonprofit organizations, and small
governmental jurisdictions. Individuals
and states are not included in the
definition of a small entity. This IFC is
not preceded by a general notice of
proposed rulemaking, and thus the
requirements of RFA do not apply.
In addition, section 1102(b)(2) of the
Act provides that whenever the
Secretaries promulgate a final version of
a rule or regulation with respect to
which an initial regulatory impact
analysis is required, the Secretaries
shall prepare a final regulatory impact
analysis with respect to the final version
of such rule or regulation. Such analysis
is required to set forth, with respect to
small rural hospitals, the matters
required under section 604 of title 5,
United States Code, to be set forth with
respect to small entities. The
Departments are not required to prepare
a final regulatory impact analysis,
because this regulatory action is being
issued as an interim final rule without
being preceded by a general notice of
proposed rulemaking.
F. Unfunded Mandates
Section 202 of the Unfunded
Mandates Reform Act of 1995 (UMRA)
requires that agencies assess anticipated
costs and benefits and take certain other
actions before issuing any proposed rule
or any final rule for which a general
notice of proposed rulemaking was
published that includes any Federal
mandate that may result in expenditures
in any 1 year by a state, local, or Tribal
governments, in the aggregate, or by the
private sector, of $100 million in 1995
dollars, updated annually for inflation.
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In 2020, that threshold is approximately
$156 million. This IFC was not
preceded by a general notice of
proposed rulemaking, and thus the
requirements of UMRA do not apply.
31 CFR Part 33
G. Federalism
Executive Order 13132 establishes
certain requirements that an agency
must meet when it promulgates a
proposed rule (and subsequent final
rule) that imposes substantial direct
requirement costs on State and local
governments, preempts State law, or
otherwise has Federalism implications.
Since this rule aims to alleviate burden
on State and local governments, the
requirements of Executive Order 13132
are not applicable.
In compliance with the requirement
of Executive Order 13132 that agencies
examine closely any policies that may
have federalism implications or limit
the policy making discretion of the
states, the Departments have engaged in
efforts to consult with and work
cooperatively with affected states,
including participating in conference
calls with and attending conferences of
the NAIC, and consulting with state
insurance officials on an individual
basis.
While developing this rule, the
Departments attempted to balance the
states’ interests in regulating health
insurance issuers with the need to
ensure market stability. By doing so, the
Departments complied with the
requirements of Executive Order 13132.
42 CFR Part 410
H. Reducing Regulation and Controlling
Regulatory Costs
Executive Order 13771, titled
Reducing Regulation and Controlling
Regulatory Costs, was issued on January
30, 2017 and requires that the costs
associated with significant new
regulations ‘‘shall, to the extent
permitted by law, be offset by the
elimination of existing costs associated
with at least two prior regulations.’’
This IFC’s designation under Executive
Order 13771, titled Reducing Regulation
and Controlling Regulatory Costs (82 FR
9339), which was issued on January 30,
2017, will be informed by public
comments received.
List of Subjects
26 CFR Part 54
Excise taxes, Health care, Health
insurance, Pensions, Reporting and
recordkeeping requirements.
29 CFR Part 2590
Employee benefit plans, Health care,
Health insurance, Penalties, Pensions,
Privacy, Reporting and recordkeeping
requirements.
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Health care, Health insurance,
Reporting and recordkeeping
requirements.
Diseases, Health facilities, Health
professions, Laboratories, Medicare,
Reporting and recordkeeping
requirements, Rural areas, X-rays.
42 CFR Part 411
Diseases, Medicare, Reporting and
recordkeeping requirements.
42 CFR Part 414
Administrative practice and
procedure, Biologics, Diseases, Drugs,
Health facilities, Health professions,
Medicare, Reporting and recordkeeping
requirements.
42 CFR Part 417
Administrative practice and
procedure, Grant programs-health,
Health care, Health insurance, Health
maintenance organizations (HMO), Loan
programs-health, Medicare, Reporting
and recordkeeping requirements.
42 CFR Part 433
Administrative practice and
procedure, Child support, Claims, Grant
programs-health, Medicaid, Reporting
and recordkeeping requirements.
42 CFR Part 510
Administrative practice and
procedure, Health facilities, Medicare,
Reporting and recordkeeping
requirement.
45 CFR Part 147
Age discrimination, Citizenship and
naturalization, Civil rights, Health care,
Health insurance, Individuals with
disabilities, Intergovernmental relations,
Reporting and recordkeeping
requirements, Sex discrimination.
45 CFR Part 155
Administrative practice and
procedure, Advertising, Brokers,
Conflict of interests, Consumer
protection, Grant programs-health,
Grants administration, Health care,
Health insurance, Health maintenance
organizations (HMO), Health records,
Hospitals, Indians, Individuals with
disabilities, Intergovernmental relations,
Loan programs-health, Medicaid,
Organization and functions
(Government agencies), Public
assistance programs, Reporting and
recordkeeping requirements, State
flexibility, Technical assistance, Women
and youth.
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45 CFR Part 182
COVID–19 diagnostic testing,
Reporting and recordkeeping
requirements.
Dated: October 21, 2020.
Seema Verma,
Administrator, Centers for Medicare &
Medicaid Services.
Dated: October 26, 2020.
Alex M. Azar II,
Secretary, Department of Health and Human
Services.
Sunita Lough,
Deputy Commissioner for Services and
Enforcement, Internal Revenue Service.
Approved: October 28, 2020.
David J. Kautter,
Assistant Secretary of the Treasury (Tax
Policy).
Signed at Washington DC, this 29th day of
October, 2020.
Jeanne Klinefelter Wilson,
Acting Assistant Secretary, Employee Benefits
Security Administration, Department of
Labor.
DEPARTMENT OF THE TREASURY
Internal Revenue Service
Amendments to the Regulations
For the reasons set forth in the
preamble, the Department of the
Treasury amends 26 CFR part 54 as set
forth below:
PART 54—PENSION EXCISE TAXES
■ Par. 1. The authority citation for part
54 continues to read in part as follows:
Authority: 26 U.S.C. 7805, unless
otherwise noted.
*
*
*
*
*
Section 54.9815–2713T also issued
under 26 U.S.C. 9833.
*
*
*
*
*
■ 2. Section 54.9815–2713T is added to
read as follows:
§ 54.9815–2713T Coverage of preventive
health services (temporary).
(a) Services—(1) In general. Beginning
at the time described in paragraph (b) of
this section and subject to § 54.9815–
2713A, a group health plan, or a health
insurance issuer offering group health
insurance coverage, must provide
coverage for and must not impose any
cost-sharing requirements (such as a
copayment, coinsurance, or a
deductible) for—
(i) Evidence-based items or services
that have in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force with respect to the individual
involved (except as otherwise provided
in paragraph (c) of this section);
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(ii) Immunizations for routine use in
children, adolescents, and adults that
have in effect a recommendation from
the Advisory Committee on
Immunization Practices of the Centers
for Disease Control and Prevention with
respect to the individual involved (for
purposes of this paragraph (a)(1)(ii), a
recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention is considered in effect after
it has been adopted by the Director of
the Centers for Disease Control and
Prevention, and a recommendation is
considered to be for routine use if it is
listed on the Immunization Schedules of
the Centers for Disease Control and
Prevention);
(iii) With respect to infants, children,
and adolescents, evidence-informed
preventive care and screenings provided
for in comprehensive guidelines
supported by the Health Resources and
Services Administration;
(iv) With respect to women, such
additional preventive care and
screenings not described in paragraph
(a)(1)(i) of this section as provided for in
comprehensive guidelines supported by
the Health Resources and Services
Administration for purposes of section
2713(a)(4) of the Public Health Service
Act, subject to 45 CFR 147.131, 147.132,
and 147.133; and
(v) Any qualifying coronavirus
preventive service, which means an
item, service, or immunization that is
intended to prevent or mitigate
coronavirus disease 2019 (COVID–19)
and that is, with respect to the
individual involved—
(A) An evidence-based item or service
that has in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force; or
(B) An immunization that has in effect
a recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention (regardless of whether the
immunization is recommended for
routine use). For purposes of this
paragraph (a)(1)(v)(B), a
recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention is considered in effect after
it has been adopted by the Director of
the Centers for Disease Control and
Prevention.
(2) Office visits. (i) If an item or
service described in paragraph (a)(1) of
this section is billed separately (or is
tracked as individual encounter data
separately) from an office visit, then a
plan or issuer may impose cost-sharing
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71193
requirements with respect to the office
visit.
(ii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is the delivery
of such an item or service, then a plan
or issuer may not impose cost-sharing
requirements with respect to the office
visit.
(iii) If an item or service described in
paragraph (a)(1) of this section is not
billed separately (or is not tracked as
individual encounter data separately)
from an office visit and the primary
purpose of the office visit is not the
delivery of such an item or service, then
a plan or issuer may impose costsharing requirements with respect to the
office visit.
(iv) The rules of this paragraph (a)(2)
are illustrated by the following
examples:
(A) Example 1—(1) Facts. An
individual covered by a group health
plan visits an in-network health care
provider. While visiting the provider,
the individual is screened for
cholesterol abnormalities, which has in
effect a rating of A or B in the current
recommendations of the United States
Preventive Services Task Force with
respect to the individual. The provider
bills the plan for an office visit and for
the laboratory work of the cholesterol
screening test.
(2) Conclusion. In paragraph
(a)(2)(iv)(A)(1) of this section, the plan
may not impose any cost-sharing
requirements with respect to the
separately-billed laboratory work of the
cholesterol screening test. Because the
office visit is billed separately from the
cholesterol screening test, the plan may
impose cost-sharing requirements for
the office visit.
(B) Example 2—(1) Facts. Same facts
as in paragraph (a)(2)(iv)(A)(1) of this
section (Example 1). As the result of the
screening, the individual is diagnosed
with hyperlipidemia and is prescribed a
course of treatment that is not included
in the recommendations under
paragraph (a)(1) of this section.
(2) Conclusion. In paragraph
(a)(2)(iv)(B)(1) of this section, because
the treatment is not included in the
recommendations under paragraph
(a)(1) of this section, the plan is not
prohibited from imposing cost-sharing
requirements with respect to the
treatment.
(C) Example 3—(1) Facts. An
individual covered by a group health
plan visits an in-network health care
provider to discuss recurring abdominal
pain. During the visit, the individual
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has a blood pressure screening, which
has in effect a rating of A or B in the
current recommendations of the United
States Preventive Services Task Force
with respect to the individual. The
provider bills the plan for an office visit.
(2) Conclusion. In paragraph
(a)(2)(iv)(C)(1) of this section, the blood
pressure screening is provided as part of
an office visit for which the primary
purpose was not to deliver items or
services described in paragraph (a)(1) of
this section. Therefore, the plan may
impose a cost-sharing requirement for
the office visit charge.
(D) Example 4—(1) Facts. A child
covered by a group health plan visits an
in-network pediatrician to receive an
annual physical exam described as part
of the comprehensive guidelines
supported by the Health Resources and
Services Administration. During the
office visit, the child receives additional
items and services that are not described
in the comprehensive guidelines
supported by the Health Resources and
Services Administration, nor otherwise
described in paragraph (a)(1) of this
section. The provider bills the plan for
an office visit.
(2) Conclusion. In paragraph
(a)(2)(iv)(D)(1) of this section, the
service was not billed as a separate
charge and was billed as part of an
office visit. Moreover, the primary
purpose for the visit was to deliver
items and services described as part of
the comprehensive guidelines
supported by the Health Resources and
Services Administration. Therefore, the
plan may not impose a cost-sharing
requirement with respect to the office
visit.
(3) Out-of-network providers. (i)
Subject to paragraphs (a)(3)(ii) and (iii)
of this section, nothing in this section
requires a plan or issuer that has a
network of providers to provide benefits
for items or services described in
paragraph (a)(1) of this section that are
delivered by an out-of-network
provider, or precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
(ii) If a plan or issuer does not have
in its network a provider who can
provide an item or service described in
paragraph (a)(1) of this section, the plan
or issuer must cover the item or service
when performed by an out-of-network
provider, and may not impose costsharing with respect to the item or
service.
(iii) A plan or issuer must provide
coverage for and must not impose any
cost-sharing requirements (such as a
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copayment, coinsurance, or a
deductible) for any qualifying
coronavirus preventive service
described in paragraph (a)(1)(v) of this
section, regardless of whether such
service is delivered by an in-network or
out-of-network provider. For purposes
of this paragraph (a)(3)(iii), with respect
to a qualifying coronavirus preventive
service and a provider with whom the
plan or issuer does not have a
negotiated rate for such service (such as
an out-of-network provider), the plan or
issuer must reimburse the provider for
such service in an amount that is
reasonable, as determined in
comparison to prevailing market rates
for such service.
(4) Reasonable medical management.
Nothing prevents a plan or issuer from
using reasonable medical management
techniques to determine the frequency,
method, treatment, or setting for an item
or service described in paragraph (a)(1)
of this section to the extent not specified
in the relevant recommendation or
guideline. To the extent not specified in
a recommendation or guideline, a plan
or issuer may rely on the relevant
clinical evidence base and established
reasonable medical management
techniques to determine the frequency,
method, treatment, or setting for
coverage of a recommended preventive
health service.
(5) Services not described. Nothing in
this section prohibits a plan or issuer
from providing coverage for items and
services in addition to those
recommended by the United States
Preventive Services Task Force or the
Advisory Committee on Immunization
Practices of the Centers for Disease
Control and Prevention, or provided for
by guidelines supported by the Health
Resources and Services Administration,
or from denying coverage for items and
services that are not recommended by
that task force or that advisory
committee, or under those guidelines. A
plan or issuer may impose cost-sharing
requirements for a treatment not
described in paragraph (a)(1) of this
section, even if the treatment results
from an item or service described in
paragraph (a)(1) of this section.
(b) Timing—(1) In general. A plan or
issuer must provide coverage pursuant
to paragraph (a)(1) of this section for
plan years that begin on or after
September 23, 2010, or, if later, for plan
years that begin on or after the date that
is one year after the date the
recommendation or guideline is issued,
except as provided in paragraph (b)(3) of
this section.
(2) Changes in recommendations or
guidelines. (i) A plan or issuer that is
required to provide coverage for any
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Fmt 4701
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items and services specified in any
recommendation or guideline described
in paragraph (a)(1) of this section on the
first day of a plan year, or as otherwise
provided in paragraph (b)(3) of this
section, must provide coverage through
the last day of the plan or policy year,
even if the recommendation or
guideline changes or is no longer
described in paragraph (a)(1) of this
section, during the applicable plan or
policy year.
(ii) Notwithstanding paragraph
(b)(2)(i) of this section, to the extent a
recommendation or guideline described
in paragraph (a)(1)(i) of this section that
was in effect on the first day of a plan
year, or as otherwise provided in
paragraph (b)(3) of this section, is
downgraded to a ‘‘D’’ rating, or any item
or service associated with any
recommendation or guideline specified
in paragraph (a)(1) of this section is
subject to a safety recall or is otherwise
determined to pose a significant safety
concern by a Federal agency authorized
to regulate the item or service during a
plan or policy year, there is no
requirement under this section to cover
these items and services through the last
day of the applicable plan or policy
year.
(3) Rapid coverage of preventive
services for coronavirus. In the case of
a qualifying coronavirus preventive
service described in paragraph (a)(1)(v)
of this section, a plan or issuer must
provide coverage for such item, service,
or immunization in accordance with
this section by the date that is 15
business days after the date on which a
recommendation specified in paragraph
(a)(1)(v)(A) or (B) of this section is made
relating to such item, service, or
immunization.
(c) Recommendations not current. For
purposes of paragraph (a)(1)(i) of this
section, and for purposes of any other
provision of law, recommendations of
the United States Preventive Services
Task Force regarding breast cancer
screening, mammography, and
prevention issued in or around
November 2009 are not considered to be
current.
(d) Applicability date. The provisions
of paragraphs (a)(1)(i) through (iv),
(a)(2), (a)(3)(i) and (ii), (a)(4) through (5),
(b)(1) and (2), and (c) of this section are
applicable as of April 16, 2012.
(e) Sunset date. The provisions of
paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3)
of this section will not apply with
respect to a qualifying coronavirus
preventive service furnished on or after
the expiration of the public health
emergency determined on January 31,
2020, to exist nationwide as of January
27, 2020, by the Secretary of Health and
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Human Services pursuant to section 319
of the Public Health Service Act, as a
result of COVID–19, including any
subsequent renewals of that
determination.
DEPARTMENT OF LABOR
Employee Benefits Security
Administration
For the reasons set forth in the
preamble, the Department of Labor
amends 29 CFR part 2590 as set forth
below:
PART 2590—RULES AND
REGULATIONS FOR GROUP HEALTH
PLANS
3. The authority citation for part 2590
continues to read as follows:
■
Authority: 29 U.S.C. 1027, 1059, 1135,
1161–1168, 1169, 1181–1183, 1181 note,
1185, 1185a, 1185b, 1191, 1191a, 1191b, and
1191c; sec. 101(g), Pub. L. 104–191, 110 Stat.
1936; sec. 401(b), Pub. L. 105–200, 112 Stat.
645 (42 U.S.C. 651 note); sec. 512(d), Pub. L.
110–343, 122 Stat. 3881; sec. 1001, 1201, and
1562(e), Pub. L. 111–148, 124 Stat. 119, as
amended by Pub. L. 111–152, 124 Stat. 1029;
Division M, Pub. L. 113–235, 128 Stat. 2130;
Secretary of Labor’s Order 1–2011, 77 FR
1088 (Jan. 9, 2012).
4. Section 2590.715–2713 is
amended—
■ a. In paragraph (a)(1)(iii) by removing
‘‘and’’ after the semicolon;
■ b. In paragraph (a)(1)(iv) by removing
the period at the end of the paragraph
and adding ‘‘; and’’ in its place;
■ c. By adding paragraph (a)(1)(v);
■ d. By revising paragraph (a)(3)(i);
■ e. By adding paragraph (a)(3)(iii);
■ f. By revising paragraphs (b)(1) and
(b)(2)(i) and (ii); and
■ g. By adding paragraphs (b)(3) and (e).
The revisions and additions read as
follows:
■
§ 2590.715–2713
health services.
Coverage of preventive
(a) * * *
(1) * * *
(v) Any qualifying coronavirus
preventive service, which means an
item, service, or immunization that is
intended to prevent or mitigate
coronavirus disease 2019 (COVID–19)
and that is, with respect to the
individual involved—
(A) An evidence-based item or service
that has in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force; or
(B) An immunization that has in effect
a recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention (regardless of whether the
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immunization is recommended for
routine use). For purposes of this
paragraph (a)(1)(v)(B), a
recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention is considered in effect after
it has been adopted by the Director of
the Centers for Disease Control and
Prevention.
*
*
*
*
*
(3) * * *
(i) Subject to paragraphs (a)(3)(ii) and
(iii) of this section, nothing in this
section requires a plan or issuer that has
a network of providers to provide
benefits for items or services described
in paragraph (a)(1) of this section that
are delivered by an out-of-network
provider, or precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
*
*
*
*
*
(iii) A plan or issuer must provide
coverage for and must not impose any
cost-sharing requirements (such as a
copayment, coinsurance, or a
deductible) for any qualifying
coronavirus preventive service
described in paragraph (a)(1)(v) of this
section, regardless of whether such
service is delivered by an in-network or
out-of-network provider. For purposes
of this paragraph (a)(3)(iii), with respect
to a qualifying coronavirus preventive
service and a provider with whom the
plan or issuer does not have a
negotiated rate for such service (such as
an out-of-network provider), the plan or
issuer must reimburse the provider for
such service in an amount that is
reasonable, as determined in
comparison to prevailing market rates
for such service.
*
*
*
*
*
(b) * * *
(1) In general. A plan or issuer must
provide coverage pursuant to paragraph
(a)(1) of this section for plan years that
begin on or after September 23, 2010, or,
if later, for plan years that begin on or
after the date that is one year after the
date the recommendation or guideline is
issued, except as provided in paragraph
(b)(3) of this section.
(2) * * *
(i) A plan or issuer that is required to
provide coverage for any items and
services specified in any
recommendation or guideline described
in paragraph (a)(1) of this section on the
first day of a plan year, or as otherwise
provided in paragraph (b)(3) of this
section, must provide coverage through
the last day of the plan or policy year,
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71195
even if the recommendation or
guideline changes or is no longer
described in paragraph (a)(1) of this
section, during the applicable plan or
policy year.
(ii) Notwithstanding paragraph
(b)(2)(i) of this section, to the extent a
recommendation or guideline described
in paragraph (a)(1)(i) of this section that
was in effect on the first day of a plan
year, or as otherwise provided in
paragraph (b)(3) of this section, is
downgraded to a ‘‘D’’ rating, or any item
or service associated with any
recommendation or guideline specified
in paragraph (a)(1) of this section is
subject to a safety recall or is otherwise
determined to pose a significant safety
concern by a Federal agency authorized
to regulate the item or service during a
plan or policy year, there is no
requirement under this section to cover
these items and services through the last
day of the applicable plan or policy
year.
(3) Rapid coverage of preventive
services for coronavirus. In the case of
a qualifying coronavirus preventive
service described in paragraph (a)(1)(v)
of this section, a plan or issuer must
provide coverage for such item, service,
or immunization in accordance with
this section by the date that is 15
business days after the date on which a
recommendation specified in paragraph
(a)(1)(v)(A) or (B) of this section is made
relating to such item, service, or
immunization.
*
*
*
*
*
(e) Sunset date. The provisions of
paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3)
of this section will not apply with
respect to a qualifying coronavirus
preventive service furnished on or after
the expiration of the public health
emergency determined on January 31,
2020, to exist nationwide as of January
27, 2020, by the Secretary of Health and
Human Services pursuant to section 319
of the Public Health Service Act, as a
result of COVID–19, including any
subsequent renewals of that
determination.
DEPARTMENT OF THE TREASURY
Office of the Secretary
Amendments to the Regulations
For the reasons set forth in the
preamble, the Department of Treasury
amends 31 CFR part 33 as set forth
below:
PART 33—WAIVERS FOR STATE
INNOVATION
5. The authority citation for part 33
continues to read as follows:
■
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Authority: Sec. 1332, Pub. L. 111–148, 124
Stat. 119.
6. Section 33.118 is added to read as
follows:
■
§ 33.118 Modification from the normal
public notice requirements during the
public health emergency.
(a) The Secretary and the Secretary of
Health and Human Services may
modify, in part, the State public notice
requirements under § 33.112 and the
Federal public notice procedures under
§ 33.116 to expedite a decision on a
proposed waiver request during the
public health emergency for COVID–19,
as defined in 42 CFR 400.200, when a
delay would undermine or compromise
the purpose of the proposed waiver
request and be contrary to the interests
of consumers. These flexibilities are
limited to event-triggered, emergent
situations, and the flexibilities outlined
in this section will not be available for
States seeking to address a threat to
consumers’ access to health coverage or
care that existed prior to the public
health emergency for COVID–19.
(b) A State must meet all of the
following criteria to request a
modification under paragraph (a) of this
section:
(1) The State must request a
modification under paragraph (a) of this
section, in the form and manner
specified by the Secretaries.
(2) The State must have acted in good
faith, and in a diligent, timely, and
prudent manner in the preparation of
the request for a modification under
paragraph (a) of this section, and the
waiver application request, as
applicable.
(3) The State must, as applicable,
detail in its request for a modification
from State-level notice procedures
under paragraph (a) of this section the
justification for the request and the
alternative public notice procedures it
proposes to implement at the State
level, including public hearings, that are
designed to provide the greatest
opportunity and level of meaningful
public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the State’s request for a
modification. As a condition of
receiving a modification approval, a
State must implement public notice
procedures, including public hearings,
at the State level and, if required, amend
the waiver application request.
(4) The State must, as applicable,
detail in its request for a modification
from Federal-level notice procedures
under paragraph (a) of this section the
justification for the request as it relates
to the public health emergency and the
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Jkt 253001
alternative public notice procedures it
requests to be implemented at the
Federal level.
(c) The Secretary and the Secretary of
Health and Human Services will
evaluate a State’s request for a
modification under paragraph (a) of this
section and issue their exemption
determination within approximately 15
calendar days after the request is
received.
(d) The Secretary of Health and
Human Services will publish on the
Centers for Medicare and Medicaid
Services (CMS) website any
modification determinations within 15
calendar days of the Secretary and the
Secretary of Health and Human Services
making such a determination, as well as
the approved revised timeline for public
comment under the approved
alternative State or Federal public
notice procedures, as applicable.
(e) The State must publish on its
website any modification requests and
determinations within 15 calendar days
of receipt of the determination, as well
as the approved revised timeline for
public comment under the alternative
State or Federal public notice
procedures, as applicable.
(f) The State must, as applicable,
implement the alternative public notice
procedures at the State level if the
State’s exemption request is approved
and, if required, amend the waiver
application request.
■ 7. Section 33.120 is amended—
■ a. In paragraph (c)(1) by adding a
paragraph heading; and
■ b. By adding paragraph (c)(2).
The additions read as follows:
§ 33.120
Monitoring and compliance.
*
*
*
*
*
(c) * * *
(1) Notification requirements for
public forum. * * *
(2) Modification from the normal
post-award requirements during the
public health emergency. (i) The
Secretary and the Secretary of Health
and Human Services may modify, in
part, State post-award requirements
under this paragraph (c)(2) for an
approved waiver request during the
public health emergency for COVID–19,
as defined in 42 CFR 400.200, when the
application of the post award public
notice requirements would be contrary
to the interests of consumers during the
public health emergency. These
flexibilities are limited to eventtriggered, emergent situations, and the
flexibilities outlined in this section will
not be available for States seeking to
address a threat to consumers’ access to
health coverage or care that existed
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prior to the public health emergency for
COVID–19.
(ii) A State must meet all of the
following criteria to request a
modification under paragraph (c) of this
section:
(A) The State must request a
modification under this paragraph
(c)(2), in the form and manner specified
by the Secretaries.
(B) The State must have acted in good
faith, and in a diligent, timely, and
prudent manner to comply with the
monitoring and compliance requirement
under the waiver and the terms and
conditions of the agreement between the
Secretary and the Secretary of Health
and Human Services, as applicable, and
the State to implement a section 1332
waiver and to submit and prepare the
request for a modification under this
paragraph (c)(2).
(C) The State must detail in its request
for a modification under this paragraph
(c)(2) the alternative post award public
notice procedures it proposes to
implement at the State level, including
public hearings, that are designed to
provide the greatest opportunity and
level of meaningful public input from
impacted stakeholders that is
practicable given the emergency
circumstances underlying the State’s
request for a modification.
(D) The Secretary and the Secretary of
Health and Human Services will
evaluate a State’s request for a
modification under this paragraph (c)(2)
and issue their modification
determination within approximately 15
calendar days after the request is
received.
(E) The State must publish on its
website any modification requests and
determinations within 15 calendar days
of the receipt of the determination as
well as information on the approved
revised timeline for the state’s post
award public notice procedures, as
applicable.
*
*
*
*
*
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
For the reasons stated in the
preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR
chapter IV as set forth below:
PART 410—SUPPLEMENTARY
MEDICAL INSURANCE (SMI)
BENEFITS
8. The authority citation part 414
continues to read as follows:
■
Authority: 42 U.S.C. 1302, 1395m,
1395hh, 1395rr, and 1395ddd.
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9. Section 410.57 is amended by
adding paragraph (c) to read as follows:
■
§ 410.57 Pneumococcal vaccine, flu
vaccine, and COVID–19 vaccine.
*
*
*
*
*
(c) Medicare Part B pays for the
COVID–19 vaccine and its
administration.
■ 10. Section 410.152 is amended by
revising paragraph (l)(1) to read as
follows:
§ 410.152
Amounts of payment.
*
*
*
*
*
(l) * * *
(1) Pneumococcal (as specified in
paragraph (h) of this section), influenza,
hepatitis B, and COVID–19 vaccine and
administration.
*
*
*
*
*
■ 11. Section 410.160 is amended by
revising paragraph (b)(2) to read as
follows:
§ 414.701
Purpose.
This subpart implements section
1842(o) of the Act by specifying the
methodology for determining the
payment allowance limit for drugs and
biologicals covered under Part B of Title
XVIII of the Act (hereafter in this
subpart referred to as the ‘‘program’’)
that are not paid on a cost or
prospective payment system basis.
Examples of drugs that are subject to the
rules contained in this subpart are:
Drugs furnished incident to a
physician’s service; durable medical
equipment (DME) drugs; separately
billable drugs at independent dialysis
facilities not under the ESRD composite
rate; statutorily covered drugs, for
example, influenza, pneumococcal,
hepatitis, and COVID–19 vaccines,
antigens, hemophilia blood clotting
factor, immunosuppressive drugs and
certain oral anti-cancer drugs.
16. Section 414.707 is amended by
revising paragraph (a)(2)(iii) to read as
follows:
■
§ 410.160
Part B annual deductible.
*
*
*
*
*
(b) * * *
(2) Pneumococcal, influenza, and
hepatitis b, and COVID–19 vaccines and
their administration.
*
*
*
*
*
PART 411—EXCLUSIONS FROM
MEDICARE AND LIMITATIONS ON
MEDICARE PAYMENT
12. The authority citation part 411
continues to read as follows:
■
Authority: 42 U.S.C. 1302, 1395w-101
through 1395w–152, 1395hh, and 1395nn.
13. Section 411.15 is amended by:
a. Removing ‘‘and’’ at the end of
paragraph (e)(3);
■ b. Removing the period at the end of
paragraph (e)(4) and adding ‘‘; and’’ in
its place; and
■ c. Adding paragraph (e)(5).
The addition reads as follows:
§ 411.15 Particular services excluded from
coverage.
Basis and scope.
*
*
*
*
*
(b) * * *
(3) * * *
(ii) Pneumococcal, Hepatitis B, and
COVID–19 vaccines.
*
*
*
*
*
§ 414.904 Average sales price as the basis
for payment.
*
PART 414—PAYMENT FOR PART B
MEDICAL AND OTHER HEALTH
SERVICES
14. The authority citation part 414
continues to read as follows:
■
Authority: 42 U.S.C. 1302, 1395hh, and
1395rr(b)(l).
15. Section 414.701 is revised to read
as follows:
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§ 414.900
18. Section 414.904 is amended by
revising paragraph (e)(1) to read as
follows:
*
*
*
*
(e) * * *
(5) COVID–19 vaccinations that are
reasonable and necessary for the
prevention of illness.
*
*
*
*
*
19:21 Nov 05, 2020
17. Section 414.900 is amended by
revising paragraph (b)(3)(ii) to read as
follows:
■
*
VerDate Sep<11>2014
Basis of payment.
(a) * * *
(2) * * *
(iii) Pneumococcal, influenza, and
COVID–19 vaccines as well as hepatitis
B vaccine that is furnished to
individuals at high or intermediate risk
of contracting hepatitis B (as determined
by the Secretary).
*
*
*
*
*
■
■
■
■
§ 414.707
*
*
*
*
(e) * * *
(1) Vaccines. The payment limits for
hepatitis B vaccine furnished to
individuals at high or intermediate risk
of contracting hepatitis B (as determined
by the Secretary), pneumococcal
vaccine, influenza vaccine, and COVID–
19 vaccine are calculated using 95
percent of the average wholesale price.
*
*
*
*
*
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PART 417—HEALTH MAINTENANCE
ORGANIZATIONS, COMPETITIVE
MEDICAL PLANS, AND HEALTH CARE
PREPAYMENT PLANS
19. The authority citation for part 417
is revised to read as follows:
■
Authority: 42 U.S.C. 1302 and 1395hh,
and 300e, 300e–5, and 300e–9, and 31 U.S.C.
9701.
20. Section 417.454 is amended by
adding paragraph (e)(4) to read as
follows:
■
§ 417.454 Charges to
Medicare enrollees.
*
*
*
*
*
(e) * * *
(4) A COVID–19 vaccine and its
administration described in section
1861(s)(10)(A) for the duration of the
emergency period defined in paragraph
(1)(B) of section 1135(g) of the Act.
PART 433—STATE FISCAL
ADMINISTRATION
21. The authority citation for part 433
continues to read as follows:
■
Authority: Sec. 1102 of the Social Security
Act, (42 U.S.C. 1302).
22. Subpart G, consisting of § 433.400,
is added to read as follows:
■
Subpart G—Temporary FMAP Increase
During the Public Health Emergency
for COVID–19
§ 433.400 Continued Enrollment for
Temporary FMAP Increase.
(a) Statutory basis. This subpart
interprets and implements section
6008(b)(3) of the Families First
Coronavirus Response Act (FFCRA) and
section 1902(a)(4) and (a)(19) of the
Social Security Act.
(b) Definitions. For purposes of this
subpart—
COVID–19 means Coronavirus Disease
2019.
Medicare Savings Program means the
coverage of Medicare premiums and
cost sharing furnished to individuals
described in, and determined by the
state to be eligible under, section
1902(a)(10)(E)(i), 1902(a)(10)(E)(iii), or
1902(a)(10)(E)(iv) of the Act.
Minimum essential coverage (MEC)
has the meaning provided under section
5000A(f)(1) of the Internal Revenue
Code and implementing regulations at
26 CFR 1.5000A–2 and includes
minimum essential coverage determined
by the Secretary under 26 CFR 1.5000A–
2(f).
Public Health Emergency for COVID–
19 has the same definition provided in
§ 400.200 of this chapter.
Temporary FMAP increase means the
6.2 percentage point increase in the
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State’s Federal medical assistance
percentage (FMAP) that is authorized
under section 6008(a) of the FFCRA
through the end of the fiscal quarter in
which the Public Health Emergency for
COVID–19 ends.
Validly enrolled means that the
beneficiary was enrolled in Medicaid
based on a determination of eligibility.
A beneficiary is not validly enrolled if
the agency determines the eligibility
was erroneously granted at the most
recent determination, redetermination,
or renewal of eligibility (if such last
redetermination or renewal was
completed prior to March 18, 2020)
because of agency error or fraud (as
evidenced by a fraud conviction) or
abuse (as determined following the
completion of an investigation pursuant
to §§ 455.15 and 455.16 of this chapter)
attributed to the beneficiary or the
beneficiary’s representative, which was
material to the determination of
eligibility. Individuals receiving
medical assistance during a
presumptive eligibility period in
accordance with part 435, subpart L, of
this chapter have not received a
determination of eligibility by the state
under the state plan and are not
considered validly enrolled
beneficiaries for purposes of this
section.
(c) General requirements. (1) In order
to claim the temporary FMAP increase
for:
(i) The quarter in which November 2,
2020, falls, a state must meet the
requirements described in paragraph
(c)(2) of this section from November 2,
2020, through the end of the quarter.
(ii) Any quarter beginning after
November 2, 2020, through the quarter
in which the public health emergency
for COVID–19, including any
extensions, ends, a state must meet the
requirements described in paragraphs
(c)(2) of this section.
(2) Except as provided in paragraph
(d) of this section, for all beneficiaries
validly enrolled for benefits under the
state plan, a waiver of such plan, or a
demonstration project under section
1115(a) of the Act as of or after March
18, 2020, the state must maintain the
beneficiary’s enrollment as follows,
through the end of the month in which
the public health emergency for COVID–
19 ends:
(i)(A) For beneficiaries whose
Medicaid coverage meets the definition
of MEC in paragraph (b) of this section
as of or after March 18, 2020, the state
must continue to provide Medicaid
coverage that meets the definition of
MEC, except as provided in paragraph
(c)(2)(i)(B) of this section.
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(B) For beneficiaries described in
paragraph (c)(2)(i)(A) whom the state
subsequently determines are eligible for
coverage under a Medicare Savings
Program eligibility group, the state
satisfies the requirement described in
paragraph (c)(2) of this section if it
furnishes the medical assistance
available through the Medicare Savings
Program.
(ii) For beneficiaries whose Medicaid
coverage as of or after March 18, 2020
does not meet the definition of MEC in
paragraph (b) of this section but does
include coverage for testing services and
treatments for COVID–19, including
vaccines, specialized equipment, and
therapies, the state must continue to
provide Medicaid coverage that
includes such testing services and
treatments.
(iii) For beneficiaries not described in
paragraph (c)(2)(i) or (ii) of this section,
the state must continue to provide at
least the same level of medical
assistance as was provided as of or after
March 18, 2020.
(iv) If a state determines that a validly
enrolled beneficiary is no longer eligible
for Medicaid, including on a procedural
basis, the state meets the requirements
described in paragraph (c)(2)(i), (ii), or
(iii) of this section by continuing to
provide the same Medicaid coverage
that the beneficiary would have
received absent the determination of
ineligibility.
(3) Otherwise permissible changes to
beneficiary coverage, cost sharing, and
post-eligibility treatment of income,
including both changes affecting an
individual beneficiary and approved
changes to the state plan, a section 1115
demonstration and/or a waiver
authorized under section 1915 of the
Act impacting multiple beneficiaries,
will not impact a state’s ability to claim
the temporary FMAP increase provided
that any such changes do not violate the
requirement to maintain beneficiary
enrollment described at paragraph (c)(2)
of this section or the requirement in
section 6008(b)(4) of the FFCRA.
(d) Exceptions. (1) Consistent with the
condition to claim the temporary FMAP
increase described in paragraph (c)(2) of
this section, a state may terminate a
beneficiary’s Medicaid enrollment prior
to the first day of the month after the
public health emergency for COVID–19
ends in the following circumstances:
(i) The beneficiary or the beneficiary’s
representative requests a voluntary
termination of eligibility;
(ii) The beneficiary ceases to be a
resident of the state; or
(iii) The beneficiary dies.
(2) States which have elected the
option under section 1903(v)(4) of the
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Act to provide full benefits to lawfully
residing children or pregnant women
must limit coverage for such
beneficiaries if they no longer meet the
definition of a lawfully residing child or
pregnant woman under such section to
services necessary for treatment of an
emergency medical condition, as
defined in section 1903(v)(3) of the Act.
(3)(i) For purposes of paragraph
(d)(1)(i) of this section, a beneficiary
may request a voluntary termination of
eligibility from the Medicaid coverage
in which the beneficiary is enrolled to
transition to other Medicaid coverage
for which the beneficiary is eligible,
even if the transition to the new
Medicaid coverage would not be
consistent with paragraph (c)(2) of this
section.
(ii) For purposes of paragraph
(d)(1)(ii) of this section, beneficiaries
who were identified through a data
match with the Public Assistance
Reporting Information System in
accordance with § 435.945(d) of this
chapter indicating simultaneous
enrollment in two or more states, and
who fail to respond to a request for
information to verify their residency,
may be treated as not being a state
resident for purposes of paragraph
(d)(1)(ii) of this section, provided that
the state takes all reasonably available
measures to attempt to verify the
beneficiary’s state residency. If a
beneficiary’s enrollment is terminated
under the exception at paragraph
(d)(1)(ii) of this section based on a
PARIS data match and the state
subsequently obtains information
verifying residency, the state must
reinstate the beneficiary’s Medicaid
enrollment retroactive to the date of
termination.
PART 510—COMPREHENSIVE CARE
FOR JOINT REPLACEMENT MODEL
23. The authority citation for part 510
is revised to read as follows:
■
Authority: 42 U.S.C. 1302, 1315(a), and
1395hh.
24. Section 510.2 is amended by—
a. Adding a definition for ‘‘COVID–19
Diagnosis Code’’ in alphabetical order;
and
■ b. Revising the definitions for ‘‘Lowerextremity joint replacement (LEJR)’’,
‘‘Performance year’’, and ‘‘Quality
improvement points’’.
The addition and revisions read as
follows:
■
■
§ 510.2
Definitions.
*
*
*
*
*
COVID–19 Diagnosis Code means any
of the following ICD–10–CM diagnosis
codes:
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(1) B97.29;
(2) U07.1; or
(3) Any other ICD–10–CM diagnosis
code that is recommended by the
Centers for Disease Control and
Prevention for the coding of a confirmed
case of COVID–19.
*
*
*
*
*
Lower-extremity joint replacement
(LEJR) means any procedure that is
within MS–DRG 469 or 470, or, on or
after October 1, 2020, MS–DRG 521 or
522, including lower-extremity joint
replacement procedures or reattachment
of a lower extremity.
*
*
*
*
*
Performance year means one of the
years in which the CJR model is being
tested. Performance years for the model
correlate to calendar years with the
exceptions of performance year 1, which
is April 1, 2016 through December 31,
2016 and performance year 5, which is
January 1, 2020 through September 30,
2021. For reconciliation purposes,
performance year 5 is divided into two
subsets, performance year subset 5.1
(January 1, 2020 through December 31,
2020) and performance year subset 5.2
(January 1, 2021 through September 30,
2021).
*
*
*
*
*
Quality improvement points are
points that CMS adds to a participant
hospital’s composite quality score for a
measure if the hospital’s performance
percentile on an individual quality
measure for performance years 2
through 4 and for performance year
subsets 5.1 and 5.2, increases from the
previous performance year or
performance year subset by at least 2
deciles on the performance percentile
scale, as described in § 510.315(d). For
performance year 1, CMS adds quality
improvement points to a participant
hospital’s composite quality score for a
measure if the hospital’s performance
percentile on an individual quality
measure increases from the
corresponding time period in the
previous year by at least 2 deciles on the
performance percentile scale, as
described in § 510.315(d).
*
*
*
*
*
■ 25. Section 510.200 is amended by
revising paragraphs (a) and (d)(6) to read
as follows:
§ 510.200 Time periods, included and
excluded services, and attribution.
(a) Time periods. All episodes must
begin on or after April 1, 2016 and end
on or before September 30, 2021.
*
*
*
*
*
(d) * * *
(6) For performance years 1 through 4
and for performance year subsets 5.1
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and 5.2, payments for otherwise
included items and services in excess of
2 standard deviations above the mean
regional episode payment in accordance
with § 510.300(b)(5).
*
*
*
*
*
■ 26. Section 510.300 is amended by
revising paragraphs (a) introductory
text, (a)(1)(i), (a)(1)(iii), (a)(2) and (3),
(b)(1)(iii), (b)(2)(iii), (b)(8), (c)(1) and (2),
and (c)(3)(iii) to read as follows:
§ 510.300 Determination of episode
quality-adjusted target prices.
(a) General. CMS establishes episode
quality-adjusted target prices for
participant hospitals for each
performance year or performance year
subset of the model as specified in this
section. Episode quality-adjusted target
prices are established according to the
following:
(1) * * *
(i)(A) MS–DRG 469 with hip fracture;
or
(B) For episodes beginning on or after
October 1, 2020, MS–DRG 521;
*
*
*
*
*
(iii)(A) MS–DRG 470 with hip
fracture; or
(B) For episodes beginning on or after
October 1, 2020, MS–DRG 522; or
*
*
*
*
*
(2) Applicable time period for
performance year or performance year
subset episode quality-adjusted target
prices. Episode quality-adjusted target
prices are updated to account for
Medicare payment updates no less than
2 times per year, for updated qualityadjusted target prices effective October
1 and January 1, and at other intervals
if necessary.
(3) Episodes that straddle
performance years or performance year
subsets or payment updates. The
quality-adjusted target price that applies
to the type of episode as of the date of
admission for the anchor hospitalization
is the quality-adjusted target price that
applies to the episode.
*
*
*
*
*
(b) * * *
(1) * * *
(iii) Episodes beginning in 2016
through 2018 for each of performance
year subsets 5.1 and 5.2.
(2) * * *
(iii) Regional historical episode
payments for performance year 4 and
each of performance year subsets 5.1
and 5.2.
*
*
*
*
*
(8) Inclusion of reconciliation
payments and repayments. For
performance years 3, 4, and each of
performance year subsets 5.1 and 5.2
only, reconciliation payments and
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71199
repayment amounts under
§ 510.305(f)(2) and (3) and from LEJR
episodes included in the BPCI initiative
are included in historical episode
payments.
(c) * * *
(1) Discount factors affected by the
quality incentive payments and the
composite quality score. In all
performance years and performance
year subsets, the discount factor may be
affected by the quality incentive
payment and composite quality score as
provided in § 510.315 to create the
effective discount factor or applicable
discount factor used for calculating
reconciliation payments and repayment
amounts. The quality-adjusted target
prices incorporate the effective or
applicable discount factor at
reconciliation.
(2) Discount factor for reconciliation
payments. The discount factor for
reconciliation payments in all
performance years and performance
year subsets is 3.0 percent.
(3) * * *
(iii) In performance year 4 and each
of performance year subsets 5.1 and 5.2,
3.0 percent.
*
*
*
*
*
■ 27. Section 510.305 is amended by
revising paragraphs (b), (d)(1)
introductory text, (e) introductory text,
(e)(1) introductory text, (e)(1)(i), (ii), and
(iii), (e)(1)(v)(A) introductory text,
(e)(1)(v)(A)(3), (e)(1)(v)(B) introductory
text, (e)(1)(v)(B)(3), (e)(1)(v)(C), (f)(1)(ii),
(g)(1) and (3), (h) introductory text,
(h)(5) and (6), (i), (j), and (k)(4) to read
as follows:
§ 510.305 Determination of the NPRA and
reconciliation process.
*
*
*
*
*
(b) Reconciliation. CMS uses a series
of reconciliation processes, which CMS
performs as described in paragraphs (d)
and (f) of this section, after the end of
each performance year 1 through 4 to
establish final payment amounts to
participant hospitals for CJR episodes
for a given performance year. Following
the end of each performance year 1
through 4, CMS determines actual
episode payments for each episode for
the performance year (other than
episodes that have been canceled in
accordance with § 510.210(b)), and
determines the amount of a
reconciliation payment or repayment
amount. Within performance year 5,
CMS separately performs the
reconciliation processes described in
paragraphs (d) and (f) of this section for
performance year subsets 5.1 and 5.2
and following the end of each
performance year subset 5.1 and 5.2,
CMS separately determines the actual
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episode payment for each episode for
the subset of the performance year
(other than episodes that have been
canceled in accordance with
§ 510.210(b)) and determines the
amount of a reconciliation payment or
repayment for each of performance year
subsets 5.1 and 5.2.
*
*
*
*
*
(d) * * *
(1) Beginning 2 months after the end
of each of performance years 1 through
4 and performance year subset 5.1 and
5 months after the end of performance
year subset 5.2, CMS does all of the
following:
*
*
*
*
*
(e) Calculation of the NPRA. By
comparing the quality-adjusted target
prices described in § 510.300 and the
participant hospital’s actual episode
spending for each of performance years
1 through 4 and each of performance
year subsets 5.1 and 5.2 and applying
the adjustments in paragraph (e)(1)(v) of
this section, CMS establishes an NPRA
for each participant hospital for each
such performance year or performance
year subset.
(1) Initial calculation. In calculating
the NPRA for each participant hospital
for each of performance years 1 through
4 and each of performance year subsets
5.1 and 5.2, CMS does the following:
(i) Determines actual episode
payments for each episode included in
the performance year or performance
year subset (other than episodes that
have been canceled in accordance with
§ 510.210(b)) using claims data that is
available 2 months after the end of the
performance year or performance year
subset. Actual episode payments are
capped, as applicable, at the amount
determined in accordance with
§ 510.300(b)(5) for the performance year
or performance year subset at the
amount determined in paragraph (k) of
this section for episodes affected by
extreme and uncontrollable
circumstances, or at the quality adjusted
target price determined for that episode
under § 510.300 for an episode with
actual episode payments that include a
claim with a COVID–19 diagnosis code
and initiate after the earlier of March 31,
2021 or the last day of the emergency
period described in paragraph (k)(4) of
this section.
(ii) Multiplies each episode qualityadjusted target price by the number of
episodes included in the performance
year or performance year subset (other
than episodes that have been canceled
in accordance with § 510.210(b)) to
which that episode quality-adjusted
target price applies.
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(iii) Aggregates the amounts
computed in paragraph (e)(1)(ii) of this
section for all episodes included in the
performance year or performance year
subset (other than episodes that have
been canceled in accordance with
§ 510.210(b)).
*
*
*
*
*
(v) * * *
(A) Limitation on loss. Except as
provided in paragraph (e)(1)(v)(C) of this
section, the total amount of the NPRA
and subsequent reconciliation
calculation for a performance year or
performance year subset cannot exceed
the following:
*
*
*
*
*
(3) For performance year 4 and each
of performance year subsets 5.1 and 5.2,
20 percent of the amount calculated in
paragraph (e)(1)(iii) of this section for
the performance year or performance
year subset.
*
*
*
*
*
(B) Limitation on gain. The total
amount of the NPRA and subsequent
reconciliation calculation for a
performance year or performance year
subset cannot exceed the following:
*
*
*
*
*
(3) For performance year 4 and each
of performance year subsets 5.1 and 5.2,
20 percent of the amount calculated in
paragraph (e)(1)(iii) of this section for
the performance year or performance
year subset.
*
*
*
*
*
(C) Financial loss limits for rural
hospitals, SCHs, MDHs, and RRCs. If a
participant hospital is a rural hospital,
SCH, MDH, or RRC, then for
performance year 2, the total repayment
amount for which the participant
hospital is responsible due to the NPRA
and subsequent reconciliation
calculation cannot exceed 3 percent of
the amount calculated in paragraph
(e)(1)(iii) of this section. For
performance years 3 and 4 and for
performance year subsets 5.1 and 5.2,
the amount cannot exceed 5 percent of
the amount calculated in paragraph
(e)(1)(iii) of this section.
(f) * * *
(1) * * *
(ii) Subject to paragraph (f)(1)(iii) of
this section, for performance years 2
through 4 and for each of performance
year subsets 5.1 and 5.2, results from the
subsequent reconciliation calculation
for a prior year’s reconciliation as
described in paragraph (i) of this section
and the post-episode spending and ACO
overlap calculations as described in
paragraph (j) of this section are added to
the current year’s NPRA in order to
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determine the reconciliation payment or
repayment amount.
*
*
*
*
*
(g) * * *
(1) CMS assesses each participant
hospital’s performance on quality
metrics, as described in § 510.315, to
determine whether the participant
hospital is eligible to receive a
reconciliation payment for a
performance year or performance year
subset.
*
*
*
*
*
(3) If the hospital’s composite quality
score described in § 510.315 is below
acceptable, defined as less than 4.00 for
a performance year or performance year
subset, the hospital is not eligible for a
reconciliation payment.
*
*
*
*
*
(h) Reconciliation report. CMS issues
each participant hospital a CJR
reconciliation report for the
performance year or performance year
subset. Each CJR reconciliation report
contains the following:
*
*
*
*
*
(5) As applicable, the NPRA and
subsequent reconciliation calculation
amount for the previous performance
year or performance year subset.
(6) As applicable, the post-episode
spending amount and ACO overlap
calculation for the previous
performance year or performance year
subset.
*
*
*
*
*
(i) Subsequent reconciliation
calculation. (1) Fourteen months after
the end of each of performance years 1
through 4 and performance year subset
5.1 and seventeen months after the end
of performance year subset 5.2, CMS
performs an additional calculation,
using claims data available at that time,
to account for final claims run-out and
any additional episode cancelations due
to overlap between the CJR model and
other CMS models and programs, or for
other reasons as specified in
§ 510.210(b).
(2) The subsequent calculation for
each of performance years 1 through 4
and performance year subset 5.1 occurs
concurrently with the first
reconciliation process for the following
performance year (or in the case of
performance year subset 5.1, with the
first reconciliation of performance year
subset 5.2) . If the result of the
subsequent calculation is different than
zero, CMS applies the stop-loss and
stop-gain limits in paragraph (e) of this
section to the aggregate calculation of
the amounts described in paragraphs
(e)(1)(iv) and (i)(1) of this section for
that performance year or performance
year subset (the initial reconciliation
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and the subsequent reconciliation
calculation) to ensure such amount does
not exceed the applicable stop-loss or
stop-gain limits. The subsequent
reconciliation calculation for
performance year subset 5.2 will occur
independently in 2023.
(j) Additional adjustments to the
reconciliation payment or repayment
amount. (1) In order to account for
shared savings payments, CMS will
reduce the reconciliation payment or
increase the repayment amount for the
subsequent performance year (for
performance years 1 through 4 and
performance year subset 5.1) by the
amount of the participant hospital’s
discount percentage that is paid to the
ACO in the prior performance year as
shared savings. (This amount will be
assessed independently for performance
year subset 5.2 in 2023.) This
adjustment is made only when the
participant hospital is a participant or
provider/supplier in the ACO and the
beneficiary in the CJR episode is
assigned to one of the following ACO
models or programs:
(i) The Pioneer ACO model.
(ii) The Medicare Shared Savings
Program (excluding Track 3 for CJR
episodes that initiate on or after July 1,
2017).
(iii) The Comprehensive ESRD Care
Initiative (excluding a track with
downside risk for CJR episodes that
initiate after July 1, 2017).
(iv) The Next Generation ACO model
(excluding CJR episodes that initiate on
or after July 1, 2017).
(2) If the average post-episode
Medicare Parts A and B payments for a
participant hospital in the prior
performance year or performance year
subset is greater than 3 standard
deviations above the regional average
post-episode payments for the same
performance year or performance year
subset, then the spending amount
exceeding 3 standard deviations above
the regional average post-episode
payments for the same performance year
or performance year subset is subtracted
from the net reconciliation or added to
the repayment amount for the
subsequent performance year for years 1
through 4 and performance year subset
5.1, and assessed independently for
performance year subset 5.2.
(k) * * *
(4) For a fracture or non-fracture
episode with a date of admission to the
anchor hospitalization that is on or
within 30 days before the date that the
emergency period (as defined in section
1135(g) of the Act) begins or that occurs
on or before March 31, 2021 or the last
day of such emergency period,
whichever is earlier, actual episode
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payments are capped at the quality
adjusted target price determined for that
episode under § 510.300.
28. Section 510.315 is amended by
revising paragraphs (a), (b) introductory
text, and (d) to read as follows:
■
§ 510.315 Composite quality scores for
determining reconciliation payment
eligibility and quality incentive payments.
(a) General. A participant hospital’s
eligibility for a reconciliation payment
under § 510.305(g), and the
determination of quality incentive
payments under paragraph (f) of this
section, for a performance year or
performance year subset depend on the
hospital’s composite quality score
(including any quality performance
points and quality improvement points
earned) for that performance year or
performance year subset.
(b) Composite quality score. CMS
calculates a composite quality score for
each participant hospital for each
performance year or performance year
subset which equals the sum of the
following:
*
*
*
*
*
(d) Quality improvement points. For
performance year 1, if a participant
hospital’s quality performance
percentile on an individual measure
described in § 510.400(a) increases from
the corresponding time period in the
previous year by at least 2 deciles on the
performance percentile scale, then the
hospital is eligible to receive quality
improvement points equal to 10 percent
of the total available point for that
individual measure up to a maximum
composite quality score of 20 points.
For each of performance years 2 through
4 and for each of performance year
subsets 5.1 and 5.2, if a participant
hospital’s quality performance
percentile on an individual measure
described in § 510.400(a) increases from
the previous performance year or
performance year subset by at least 2
deciles on the performance percentile
scale, then the hospitals is eligible to
receive quality improvement points
equal to 10 percent of the total available
point for that individual measure up to
a maximum composite quality score of
20 points.
*
*
*
*
*
29. Section 510.400 is amended by—
a. Revising paragraphs (a)
introductory text, (b)(2) introductory
text, (b)(2)(i), (b)(2)(ii) introductory text,
and (b)(3)(v) introductory text; and
■ b. By adding paragraph (b)(3)(vi).
The revisions and addition read as
follows:
■
■
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§ 510.400
71201
Quality measures and reporting.
(a) Reporting of quality measures. The
following quality measures are used for
public reporting, for determining
whether a participant hospital is eligible
for reconciliation payments under
§ 510.305(g), and whether a participant
hospital is eligible for quality incentive
payments under § 510.315(f) in the
performance year or performance year
subset:
*
*
*
*
*
(b) * * *
(2) Hospitals must also submit the
amount of requested THA/TKA patientreported outcomes data required for
each performance year or performance
year subset of the model in order to be
considered successful in submitting
voluntary data.
(i) The amount of requested THA/
TKA patient-reported outcomes data to
submit, in order to be considered
successful will increase each
subsequent year of the model over the
5 years of the model (with the exception
of performance year subset 5.2, for
which CMS will request the same
amount of THA/TKA patient-reported
outcomes data as performance year
subset 5.1, updated to reflect the
timeframe applicable to performance
year subset 5.2).
(ii) A phase-in approach that
determines the amount of requested
THA/TKA patient-reported outcomes
data to submit over performance years 1
through 4 and performance year subset
5.1 (with the exception of performance
year subset 5.2, for which CMS will
request the same amount of THA/TKA
patient-reported outcomes as
performance year subset 5.1, updated to
reflect the timeframe applicable to
performance year subset 5.2) of the
program will be applied so that in year
1 successful submission of data would
mean CMS received all requested THA/
TKA patient-reported outcomes and
limited risk variable data on both of the
following:
*
*
*
*
*
(3) * * *
(v) Year 5 (subset 5.1, January 1,
2020–December 31, 2020). Submit—
*
*
*
*
*
(vi) Year 5 (subset 5.2, January 1,
2021–September 30, 2021). Submit—
(A) Post-operative data on primary
elective THA/TKA procedures for ≥80%
or ≥200 procedures performed between
July 1, 2019 and June 30, 2020; and
(B) Pre-operative data on primary
elective THA/TKA procedures for ≥80%
or ≥200 procedures performed between
July 1, 2020 and June 30, 2021, unless
CMS requests a more limited data set, in
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which case, submit all requested data
elements.
*
*
*
*
*
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Office of the Secretary
For the reasons set forth in the
preamble, the Department of Health and
Human Services amends 45 CFR parts
147, 155, and 182 as set forth below:
PART 147—HEALTH INSURANCE
REFORM REQUIREMENTS FOR THE
GROUP AND INDIVIDUAL HEALTH
INSURANCE MARKETS
30. The authority citation for part 147
is revised to read as follows:
■
Authority: 42 U.S.C. 300gg through 300gg–
63, 300gg–91, and 300gg–92, as amended,
and section 3203, Pub. L. 116–136, 134 Stat.
281.
31. Section 147.130 is amended—
a. In paragraph (a)(1)(iii) by removing
‘‘and’’ after the semicolon;
■ b. In paragraph (a)(1)(iv) by removing
the period at the end of the paragraph
and adding ‘‘; and’’ in its place;
■ c. By adding paragraph (a)(1)(v);
■ d. By revising paragraph (a)(3)(i);
■ e. By adding paragraph (a)(3)(iii);
■ f. By revising paragraphs (b)(1) and
(b)(2)(i) and (ii); and
■ g. By adding paragraphs (b)(3) and (e).
The revisions and additions read as
follows:
■
■
§ 147.130
services.
Coverage of preventive health
(a) * * *
(1) * * *
(v) Any qualifying coronavirus
preventive service, which means an
item, service, or immunization that is
intended to prevent or mitigate
coronavirus disease 2019 (COVID–19)
and that is, with respect to the
individual involved—
(A) An evidence-based item or service
that has in effect a rating of A or B in
the current recommendations of the
United States Preventive Services Task
Force; or
(B) An immunization that has in effect
a recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention (regardless of whether the
immunization is recommended for
routine use). For purposes of this
paragraph (a)(1)(v)(B), a
recommendation from the Advisory
Committee on Immunization Practices
of the Centers for Disease Control and
Prevention is considered in effect after
it has been adopted by the Director of
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the Centers for Disease Control and
Prevention.
*
*
*
*
*
(3) * * *
(i) Subject to paragraphs (a)(3)(ii) and
(iii) of this section, nothing in this
section requires a plan or issuer that has
a network of providers to provide
benefits for items or services described
in paragraph (a)(1) of this section that
are delivered by an out-of-network
provider, or precludes a plan or issuer
that has a network of providers from
imposing cost-sharing requirements for
items or services described in paragraph
(a)(1) of this section that are delivered
by an out-of-network provider.
*
*
*
*
*
(iii) A plan or issuer must provide
coverage for and must not impose any
cost-sharing requirements (such as a
copayment, coinsurance, or a
deductible) for any qualifying
coronavirus preventive service
described in paragraph (a)(1)(v) of this
section, regardless of whether such
service is delivered by an in-network or
out-of-network provider. For purposes
of this paragraph (a)(3)(iii), with respect
to a qualifying coronavirus preventive
service and a provider with whom the
plan or issuer does not have a
negotiated rate for such service (such as
an out-of-network provider), the plan or
issuer must reimburse the provider for
such service in an amount that is
reasonable, as determined in
comparison to prevailing market rates
for such service.
*
*
*
*
*
(b) * * *
(1) In general. A plan or issuer must
provide coverage pursuant to paragraph
(a)(1) of this section for plan years (in
the individual market, policy years) that
begin on or after September 23, 2010, or,
if later, for plan years (in the individual
market, policy years) that begin on or
after the date that is one year after the
date the recommendation or guideline is
issued, except as provided in paragraph
(b)(3) of this section.
(2) * * *
(i) A plan or issuer that is required to
provide coverage for any items and
services specified in any
recommendation or guideline described
in paragraph (a)(1) of this section on the
first day of a plan year (in the individual
market, policy year), or as otherwise
provided in paragraph (b)(3) of this
section, must provide coverage through
the last day of the plan or policy year,
even if the recommendation or
guideline changes or is no longer
described in paragraph (a)(1) of this
section, during the applicable plan or
policy year.
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(ii) Notwithstanding paragraph
(b)(2)(i) of this section, to the extent a
recommendation or guideline described
in paragraph (a)(1)(i) of this section that
was in effect on the first day of a plan
year (in the individual market, policy
year), or as otherwise provided in
paragraph (b)(3) of this section, is
downgraded to a ‘‘D’’ rating, or any item
or service associated with any
recommendation or guideline specified
in paragraph (a)(1) of this section is
subject to a safety recall or is otherwise
determined to pose a significant safety
concern by a Federal agency authorized
to regulate the item or service during a
plan or policy year, there is no
requirement under this section to cover
these items and services through the last
day of the applicable plan or policy
year.
(3) Rapid coverage of preventive
services for coronavirus. In the case of
a qualifying coronavirus preventive
service described in paragraph (a)(1)(v)
of this section, a plan or issuer must
provide coverage for such item, service,
or immunization in accordance with
this section by the date that is 15
business days after the date on which a
recommendation specified in paragraph
(a)(1)(v)(A) or (B) of this section is made
relating to such item, service, or
immunization.
*
*
*
*
*
(e) Sunset date. The provisions of
paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3)
of this section will not apply with
respect to a qualifying coronavirus
preventive service furnished on or after
the expiration of the public health
emergency determined on January 31,
2020, to exist nationwide as of January
27, 2020, by the Secretary of Health and
Human Services pursuant to section 319
of the Public Health Service Act, as a
result of COVID–19, including any
subsequent renewals of that
determination.
PART 155—EXCHANGE
ESTABLISHMENT STANDARDS AND
OTHER RELATED STANDARDS
UNDER THE AFFORDABLE CARE ACT
32. The authority citation for part 155
continues to read as follows:
■
Authority: 42 U.S.C. 18021–18024, 18031–
18033, 18041–18042, 18051, 18054, 18071,
and 18081–18083.
33. Section 155.1318 is added to read
as follows:
■
§ 155.1318 Modification from the normal
public notice requirements during the
public health emergency.
(a) The Secretary and the Secretary of
the Treasury may modify, in part, the
State public notice requirements under
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§ 155.1312 and the Federal public notice
procedures under § 155.1316 to expedite
a decision on a proposed waiver request
during the public health emergency, as
defined in 42 CFR 400.200, when a
delay would undermine or compromise
the purpose of the proposed waiver
request and be contrary to the interests
of consumers. These flexibilities are
limited to event-triggered, emergent
situations, and the flexibilities outlined
in this section will not be available for
States seeking to address a threat to
consumers’ access to health coverage or
care that existed prior to the public
health emergency for COVID–19.
(b) A State must meet all of the
following criteria to request a
modification under paragraph (a) of this
section:
(1) The State must request a
modification under paragraph (a) of this
section, in the form and manner
specified by the Secretaries.
(2) The State must have acted in good
faith, and in a diligent, timely, and
prudent manner in the preparation of
the request for a modification under
paragraph (a) of this section, and the
waiver application request, as
applicable.
(3) The State must, as applicable,
detail in its request for a modification
from State-level notice procedures
under paragraph (a) of this section the
justification for the request as it relates
to the public health emergency and the
alternative public notice procedures it
proposes to implement at the State
level, including public hearings, that are
designed to provide the greatest
opportunity and level of meaningful
public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the State’s request for a
modification.
(4) The State must, as applicable,
detail in its request for a modification
from Federal-level notice procedures
under paragraph (a) of this section the
justification for the request and the
alternative public notice procedures it
requests to be implemented at the
Federal level.
(c) The Secretary and the Secretary of
the Treasury will evaluate a State’s
request for a modification under
paragraph (a) of this section and issue
their modification determination within
approximately 15 calendar days after
the request is received.
(d) The Secretary will publish on the
CMS website any modification
determinations within 15 calendar days
of the Secretary and the Secretary of the
Treasury making such a determination,
as well as the approved revised timeline
for public comment under the approved
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alternative State or Federal public
notice procedures, as applicable.
(e) The State must publish on its
website any modification requests and
determinations within 15 calendar days
of receipt of the determination, as well
as the approved revised timeline for
public comment under the alternative
State or Federal public notice
procedures, as applicable.
(f) The State must, as applicable,
implement the alternative public notice
procedures at the State level if the
State’s modification request is approved
and, if required, amend the waiver
application request.
■ 34. Section 155.1320 is amended—
■ a. In paragraph (c)(1) by adding a
paragraph heading; and
■ b. By adding paragraph (c)(2).
The additions read as follows:
§ 155.1320
Monitoring and compliance.
*
*
*
*
*
(c) * * *
(1) Notification requirements for
public forum. * * *
(2) Modification from the normal post
award requirements during the public
health emergency. (i) The Secretary and
the Secretary of the Treasury may
modify, in part, State post award
requirements under this paragraph (c)(2)
for an approved waiver request during
the public health emergency, as defined
in 42 CFR 400.200, when the
application of the post award public
notice requirements would be contrary
to the interests of consumers during the
public health emergency. These
flexibilities are limited to eventtriggered, emergent situations, and the
flexibilities outlined in this section will
not be available for States seeking to
address a threat to consumers’ access to
health coverage or care that existed
prior to the public health emergency for
COVID–19.
(ii) A State must meet all of the
following criteria to request a
modification under paragraph (c) of this
section:
(A) The State must request a
modification under paragraph (c)(2) of
this section, in the form and manner
specified by the Secretaries.
(B) The State must have acted in good
faith, and in a diligent, timely, and
prudent manner to comply with the
monitoring and compliance requirement
under the waiver and the terms and
conditions of the agreement between the
Secretary and the Secretary of the
Treasury, as applicable, and the State to
implement a section 1332 waiver and to
submit and prepare the request for a
modification under paragraph (c)(2) of
this section.
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71203
(C) The State must detail in its request
for a modification under paragraph
(c)(2) of this section the alternative post
award public notice procedures it
proposes to implement at the State
level, including public hearings, that are
designed to provide the greatest
opportunity and level of meaningful
public input from impacted
stakeholders that is practicable given
the emergency circumstances
underlying the State’s request for a
modification.
(D) The Secretary and the Secretary of
the Treasury will evaluate a State’s
request for a modification under
paragraph (c)(2) of this section and issue
their modification determination within
approximately 15 calendar days after
the request is received.
(E) The State must publish on its
website any modification requests and
determinations within 15 calendar days
of receipt of the determination, as well
as information on the approved revised
timeline for the State’s post award
public notice procedures, as applicable.
*
*
*
*
*
■ 35. Subchapter E–T, consisting of part
182, is added to subtitle A to read as
follows:
Subchapter E–T—Price Transparency
PART 182—PRICE TRANSPARENCY
FOR COVID–19 DIAGNOSTIC TESTS
Subpart A—General Provisions
Sec.
182.10 Basis and scope.
182.20 Definitions.
182.30 Applicability.
Subpart B—Public Disclosure
Requirements
182.40 Requirements for making public
cash prices for a diagnostic test for
COVID–19.
Subpart C—Monitoring and Penalties for
Noncompliance
182.50 Monitoring and enforcement.
182.60 Corrective action plans.
182.70 Civil monetary penalties.
Subpart D—Appeals of Civil Monetary
Penalties
182.80 Appeal of penalty.
182.90 Failure to request a hearing.
Authority: Section 3202(b), Pub. L. 116–
136, 134 Stat. 281.
Subpart A—General Provisions
§ 182.10
Basis and scope.
This part implements section
3202(b)(1) of the Coronavirus Aid,
Relief, and Economic Security Act (Pub.
L. 116–136, March 27, 2020) (CARES
Act), which requires that during the
emergency period declared under
section 319 of the PHS Act (42 U.S.C.
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247d), providers of diagnostic tests for
COVID–19 make public the cash price
for such tests on a public internet
website of such provider. This part also
implements section 3202(b)(2) of the
CARES Act, which authorizes the
Secretary to impose a civil monetary
penalty (CMP) on any provider of a
diagnostic test for COVID–19 that does
not comply with section 3202(b)(1) of
the CARES Act and that has not
completed a corrective action plan to
comply with that section, in an amount
that does not exceed $300 per day that
the violation is ongoing.
§ 182.20
Definitions.
The following definitions and
abbreviated terms apply to this part:
Cash price means the charge that
applies to an individual who pays cash
(or cash equivalent) for a COVID–19
diagnostic test.
COVID–19 for purposes of this part is
the abbreviated term for the virus called
SARS-CoV–2 and the disease it causes,
called coronavirus disease 2019.
Diagnostic test for COVID–19
(‘‘COVID–19 diagnostic test’’) means a
COVID–19 in vitro diagnostic test
described in section 6001 of the
Families First Coronavirus Response
Act (Pub. L. 116–127, March 18, 2020),
as amended by section 3201 of the
CARES Act (Pub. L. 116–136, March 27,
2020).
Provider of a diagnostic test for
COVID–19 (‘‘provider’’) means any
facility that performs one or more
COVID–19 diagnostic tests.
§ 182.30
Applicability.
(a) General applicability. The
requirements of this part apply to each
provider of a diagnostic test for COVID–
19 as defined at § 182.20.
(b) Duration of requirements. The
requirements of this part are applicable
during the public health emergency
(PHE) determined to exist nationwide as
of January 27, 2020, by the Secretary of
Health and Human Services pursuant to
section 319 of the PHS Act on January
31, 2020, as a result of confirmed cases
of COVID–19, including any subsequent
renewals.
Subpart B—Public Disclosure
Requirements
§ 182.40 Requirements for making public
cash prices for a diagnostic test for COVID–
19.
(a) General rules. (1) Except as
provided under paragraph (b) of this
section, a provider of a COVID–19
diagnostic test must make public the
information described in paragraph (c)
of this section electronically via the
internet.
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(2) The information described in
paragraph (c) of this section, or a link to
such information, must appear in a
conspicuous location on a searchable
homepage of the provider’s website.
(3) The information described in
paragraph (c) of this section must be
displayed in a manner that is easily
accessible, without barriers, and ensures
that the information is accessible:
(i) Free of charge;
(ii) Without having to establish a user
account or password; and
(iii) Without having to submit
personal identifiable information (PII).
(4) The provider must include all of
the following terms on its homepage:
(i) The provider’s name;
(ii) The term ‘‘price’’;
(iii) The term ‘‘cost’’;
(iv) The term ‘‘test’’;
(v) The term ‘‘COVID’’; and
(vi) The term ‘‘coronavirus’’.
(b) Exception. A provider of a COVID–
19 diagnostic test that does not have its
own website must make public the
information described in paragraph (c)
of this section:
(1) In writing, within two business
days upon request; and
(2) On a sign posted prominently at
the location where the provider offers a
COVID–19 diagnostic test, if such
location is accessible to the public.
(c) Required information. For
purposes of paragraphs (a) and (b) of
this section, the provider must make
public the following information:
(1) A plain-language description of
each COVID–19 diagnostic test that is
offered by the provider;
(2) The billing code used for each
COVID–19 diagnostic test;
(3) The provider’s cash price for each
such COVID–19 diagnostic test; and
(4) Any additional information as may
be necessary for the public to have
certainty of the cash price that applies
to each COVID–19 diagnostic test.
Subpart C—Monitoring and Penalties
for Noncompliance
§ 182.50
Monitoring and enforcement.
(a) Monitoring. (1) CMS may evaluate
whether a provider has complied with
the requirements under § 182.40.
(2) CMS may use methods to monitor
and assess provider compliance with
the requirements under this part,
including, but not limited to, the
following, as appropriate:
(i) CMS’ evaluation of complaints
made to CMS.
(ii) CMS review of an individual’s or
entity’s analysis of noncompliance as
stated in the complaint.
(iii) CMS review of providers’
websites.
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(b) Actions to address provider
noncompliance. If CMS concludes that
the provider is noncompliant with one
or more of the requirements of § 182.40,
CMS may take any of the following
actions:
(1) Provide a written warning notice
to the provider of the specific
violation(s).
(2) Request that the provider submit
and comply with a corrective action
plan under § 182.60.
(3) Impose a civil monetary penalty
on the provider if the provider fails to
respond to CMS’ request to submit a
corrective action plan or to comply with
the requirements of a corrective action
plan approved by CMS.
§ 182.60
Corrective action plans.
(a) Violations requiring a corrective
action plan. If CMS determines a
provider’s noncompliance with the
requirements of this part continues after
a warning notice, a corrective action
plan may be required. A violation may
include, but is not limited to, the
following:
(1) A provider’s failure to make public
its cash price information required by
§ 182.40.
(2) A provider’s failure to make public
its cash price information in the form
and manner required under § 182.40.
(b) Notice of violation. CMS may
request that a provider submit and
comply with a corrective action plan,
specified in a notice of violation issued
by CMS to a provider.
(c) Compliance with corrective action
plan requests and corrective actions. (1)
A provider required to submit a
corrective action plan must do so, in the
form and manner, and by the deadline,
specified in the notice of violation
issued by CMS to the provider, and
must comply with the requirements of
the corrective action plan approved by
CMS.
(2) A provider’s corrective action plan
must specify elements including, but
not limited to:
(i) The corrective actions or processes
the provider will take to address the
deficiency or deficiencies identified by
CMS.
(ii) The timeframe by which the
provider will complete the corrective
action.
(3) A corrective action plan is subject
to CMS review and approval.
(4) After CMS’ review and approval of
a provider’s corrective action plan, CMS
may monitor and evaluate the provider’s
compliance with the corrective actions
specified in the corrective action plan.
(d) Noncompliance with corrective
action plan requests and requirements.
(1) A provider’s failure to respond to
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CMS’ request to submit a corrective
action plan includes failure to submit a
corrective action plan in the form,
manner, or by the deadline, specified in
a notice of violation issued by CMS to
the provider.
(2) A provider’s failure to comply
with the requirements of a corrective
action plan includes failure to correct
violation(s) within the specified
timeframes.
§ 182.70
Civil monetary penalties.
(a) Basis for imposing civil monetary
penalties. CMS may impose a civil
monetary penalty on a provider
identified by CMS as noncompliant
according to § 182.50, and that fails to
respond to CMS’ request to submit a
corrective action plan or to comply with
the requirements of a corrective action
plan approved by CMS as described in
§ 182.60(d).
(b) Notice of imposition of a civil
monetary penalty. (1) If CMS imposes a
penalty in accordance with this part,
CMS will provide a written notice of
imposition of a civil monetary penalty
to the provider via certified mail or
another form of traceable carrier.
(2) This notice to the provider may
include, but is not limited to, the
following:
(i) The basis for the provider’s
noncompliance, including, but not
limited to, the following:
(A) CMS’ determination as to which
requirement(s) the provider has
violated.
(B) The provider’s failure to respond
to CMS’ request to submit a corrective
action plan or comply with the
requirements of a corrective action plan,
as described in § 182.60(d).
(ii) CMS’ determination as to the
effective date for the violation(s). This
date is the latest date of the following:
(A) The first day the provider is
required to meet the requirements of
this part.
(B) A date determined by CMS, such
as one resulting from monitoring
activities specified in § 182.50, or
development of a corrective action plan
as specified in § 182.60.
(iii) The amount of the penalty as of
the date of the notice.
(iv) A statement that a civil monetary
penalty may continue to be imposed for
continuing violation(s).
(v) Payment instructions.
(vi) A statement of the provider’s right
to a hearing according to subpart D of
this part.
(vii) A statement that the provider’s
failure to request a hearing within 30
calendar days of the issuance of the
notice permits the imposition of the
penalty, and any subsequent penalties
VerDate Sep<11>2014
19:21 Nov 05, 2020
Jkt 253001
pursuant to continuing violations,
without right of appeal in accordance
with § 182.90.
(3) If the civil monetary penalty is
upheld, in part, by a final and binding
decision according to subpart D of this
part, CMS will issue a modified notice
of imposition of a civil monetary
penalty, to conform to the adjudicated
finding.
(c) Amount of the civil monetary
penalty. (1) CMS may impose a civil
monetary penalty upon a provider for a
violation of each requirement of this
part.
(2) The maximum daily dollar amount
for a civil monetary penalty to which a
provider may be subject is $300. Even
if the provider is in violation of multiple
discrete requirements of this part, the
maximum total sum that a single
provider may be assessed per day is
$300.
(3) The maximum daily amount of the
civil monetary penalty will be adjusted
annually using the multiplier
determined by the Office of
Management and Budget for annually
adjusting civil monetary penalty
amounts under part 102 of this title.
(d) Timing of payment of civil
monetary penalty. (1) A provider must
pay the civil monetary penalty in full
within 60 calendar days after the date of
the notice of imposition of a civil
monetary penalty from CMS under
paragraph (b) of this section.
(2) In the event a provider requests a
hearing, pursuant to subpart D of this
part, the provider must pay the amount
in full within 60 calendar days after the
date of a final and binding decision,
according to subpart D of this part, to
uphold, in whole or in part, the civil
monetary penalty.
(3) If the 60th calendar day described
in paragraphs (d)(1) and (2) of this
section is a weekend or a Federal
holiday, then the timeframe is extended
until the end of the next business day.
(4) In the event a civil money penalty
is not paid in full within 60 days, CMS
will follow the collections activities set
forth in 45 CFR part 30.
(e) Continuing violations. CMS may
issue subsequent notice(s) of imposition
of a civil monetary penalty, according to
paragraph (b) of this section, that result
from the same instance(s) of
noncompliance.
Subpart D—Appeals of Civil Monetary
Penalties
§ 182.80
Appeal of penalty.
(a) A provider upon which CMS has
imposed a penalty under this part may
appeal that penalty in accordance with
subpart D of part 150 of this title, except
PO 00000
Frm 00065
Fmt 4701
Sfmt 9990
71205
as specified in paragraph (b) of this
section.
(b) For purposes of applying subpart
D of part 150 of this title to appeals of
civil monetary penalties under this part:
(1) ‘‘Respondent’’ means a provider,
as defined in § 182.20 that received a
notice of imposition of a civil monetary
penalty according to § 182.70(b).
(2) In deciding whether the amount of
a civil money penalty is reasonable, the
administrative law judge (ALJ) may only
consider evidence of record relating to
the following:
(i) The provider’s posting(s) of its cash
price information, if available.
(ii) Material the provider timely
previously submitted to CMS (including
with respect to corrective actions and
corrective action plans).
(iii) Material CMS used to monitor
and assess the provider’s compliance
according to § 182.70(a)(2).
(3) The ALJ’s consideration of
evidence of acts other than those at
issue in the instant case under
§ 150.445(g) of this title does not apply.
§ 182.90
Failure to request a hearing.
(a) If a provider does not request a
hearing within 30 calendar days of the
issuance of the notice of imposition of
a civil monetary penalty described in
§ 182.70(b), CMS may impose the civil
monetary penalty indicated in such
notice without right of appeal in
accordance with this part.
(1) If the 30th calendar day described
paragraph (a) of this section is a
weekend or a Federal holiday, then the
timeframe is extended until the end of
the next business day.
(2) [Reserved]
(b) The provider has no right to
appeal a penalty with respect to which
it has not requested a hearing in
accordance with § 150.405 of this title,
unless the provider can show good
cause, as determined at § 150.405(b) of
this title, for failing to timely exercise its
right to a hearing.
PART 182 [Transferred to Subchapter
E]
36. Effective January 1, 2021, transfer
part 182 from subchapter E–T to
subchapter E.
■
Subchapter E–T [Removed]
37. Effective January 1, 2021, remove
subchapter E–T.
■
[FR Doc. 2020–24332 Filed 11–2–20; 4:15 pm]
BILLING CODE 4120–01–P
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]]>Agencies
[Federal Register Volume 85, Number 216 (Friday, November 6, 2020)]
[Rules and Regulations]
[Pages 71142-71205]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-24332]
[[Page 71141]]
Vol. 85
Friday,
No. 216
November 6, 2020
Part II
Department of the Treasury
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Internal Revenue Service
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26 CFR Part 54
Office of the Secretary
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31 Part 33
Department of Labor
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Employee Benefits Security Administration
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29 CFR Part 2590
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 410, 411, 414, et al.
Office of the Secretary
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45 CFR Parts 147, 155 and 182
Additional Policy and Regulatory Revisions in Response to the COVID-19
Public Health Emergency; Interim Final Rule
Federal Register / Vol. 85, No. 216 / Friday, November 6, 2020 /
Rules and Regulations
[[Page 71142]]
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DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 54
[TD 9931]
Office of the Secretary
31 CFR Part 33
RIN 1545-BP97
DEPARTMENT OF LABOR
Employee Benefits Security Administration
29 CFR Part 2590
RIN 1210-AB98
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 410, 411, 414, 417, 433, and 510
Office of the Secretary
45 CFR Parts 147, 155, and 182
[CMS-9912-IFC]
RIN 0938-AU35
Additional Policy and Regulatory Revisions in Response to the
COVID-19 Public Health Emergency
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS); Internal Revenue Service, Department
of the Treasury; Employee Benefits Security Administration, Department
of Labor.
ACTION: Interim final rule with request for comments.
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SUMMARY: This interim final rule with request for comments (IFC)
discusses CMS's implementation of section 3713 of the Coronavirus Aid,
Relief, and Economic Security Act (CARES Act), which established
Medicare Part B coverage and payment for Coronavirus Disease 2019
(COVID-19) vaccine and its administration. This IFC implements
requirements in the CARES Act that providers of COVID-19 diagnostic
tests make public their cash prices for those tests and establishes an
enforcement scheme to enforce those requirements. This rule also
establishes an add-on payment for cases involving the use of new COVID-
19 treatments under the Medicare Inpatient Prospective Payment System
(IPPS). This IFC provides for separate payment for new COVID-19
treatments under the Outpatient Prospective Payment System (OPPS) for
the remainder of the PHE for COVID-19 when these treatments are
provided at the same time as a Comprehensive Ambulatory Payment
Classification (C-APC) service. This rule also interprets and
implements the requirement to maintain Medicaid beneficiary enrollment
in order to receive the temporary increase in Federal funding in the
Families First Coronavirus Response Act (FFCRA). This IFC modifies
policies of the Comprehensive Care for Joint Replacement (CJR) model
and adds technical changes to accommodate these policy changes.
Specifically, we are extending Performance Year (PY) 5 by adding 6
months, creating an episode-based extreme and uncontrollable
circumstances COVID-19 policy, providing two reconciliation periods for
PY 5, and adding DRGs 521 and 522 for hip and knee procedures. This
rule also amends regulations regarding coverage of preventive health
services to implement section 3203 of the CARES Act, which shortens the
timeframe within which non-grandfathered group health plans and health
insurance issuers offering non-grandfathered group or individual health
insurance coverage must begin to cover without cost sharing qualifying
coronavirus preventive services, including recommended COVID-19
immunizations. This IFC also revises regulations to set forth
flexibilities in the public notice requirements and post award public
participation requirements for State Innovation Waivers under section
1332 of the Patient Protection and Affordable Care Act (PPACA) during
the public health emergency for COVID-19.
DATES: Effective date: These regulations are effective on November 2,
2020, except for amendatory instructions 36 and 37, which are effective
on January 1, 2021.
Applicability date: Except as otherwise specified in this
paragraph, these regulations are applicable from November 2, 2020,
until the end of the public health emergency for COVID-19 as determined
by the HHS Secretary. The regulations at 42 CFR 410.57, 410.152,
410.160, 411.15, 414.701, 414.707, 414.900, and 414.904 and at 42 CFR
part 510 (other than 42 CFR 510.300(a)(1)(i) and (iii)) are applicable
November 2, 2020. Because the requirement at section 6008(b)(3) of the
Families First Coronavirus Response Act (FFCRA) is not limited to the
duration of the public health emergency for COVID-19, regulations at 42
CFR part 433, subpart G, apply from November 2, 2020, through the end
of the last month of the public health emergency for COVID-19 in
accordance with section 6008(b)(3) of the Families First Coronavirus
Response Act. Regulations at 42 CFR 510.300(a)(1)(i) and (a)(1)(iii)
are applicable October 1, 2020.
Comment date: To be assured consideration, comments must be
received at one of the addresses provided below, no later than 5 p.m.
on January 4, 2021.
ADDRESSES: In commenting, please refer to file code CMS-9912-IFC.
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-9912-IFC, P.O. Box 8016,
Baltimore, MD 21244-8016.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address ONLY: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-9912-IFC, 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: Laura Kennedy, (410) 786-3377, for
discussion related to COVID-19 vaccine and administration payment
provided under Medicare Part B.
Lina Rashid, (443) 902-2823, or Michelle Koltov, (301) 492-4225,
Centers for Medicare & Medicaid Services, Department of Health and
Human Services, Services, Kimberly Koch, (202) 622-0854, Department of
the Treasury, for issues related to State Innovation Waivers Policy and
Regulatory Revisions in Response to the COVID-19 Public Health
Emergency.
Dr. Terri Postma or Rhonda Sheppard, (410) 786-8465, or via email
at [email protected], for provisions related to Price
Transparency for COVID-19 Diagnostic Testing.
[[Page 71143]]
Cristina Nigro, (410) 786-7763, for issues related to the Medicare
Inpatient Prospective Payment System (IPPS) New COVID-19 Treatments
Add-on Payment (NCTAP) for the remainder of the public health
emergency.
David Mlawsky, (410) 786-1565, Centers for Medicare & Medicaid
Services, Department of Health and Human Services, Elizabeth
Schumacher, (202) 693-8335, Employee Benefits Security Administration,
Department of Labor, Dara Alderman, (202) 317-5500, Internal Revenue
Service, Department of the Treasury, for issues related to Rapid
Coverage of Preventive Services for Coronavirus.
Stephanie Bell, (410) 786-0617, for issues related to the temporary
increase in Federal Medicaid funding.
Bobbie Knickman, (410) 786-4161; Heather Holsey, (410) 786-0028;
Sarah Mioduski, (410) 786-2014 or email [email protected] for the
Comprehensive Care for Joint Replacement Model.
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://regulations.gov. Follow the search instructions on that website to view
public comments.
Background
The United States is responding to an outbreak of respiratory
disease caused by a novel coronavirus that was first detected in China
and has now been detected in more than 190 countries internationally,
and all 50 States, the District of Columbia, and U.S. territories. The
virus has been named ``severe acute respiratory syndrome coronavirus
2'' (``SARS-CoV-2'') and the disease it causes has been named
``coronavirus disease 2019'' (``COVID-19'').
On January 30, 2020, the International Health Regulations Emergency
Committee of the World Health Organization (WHO) declared the outbreak
a ``Public Health Emergency of International Concern.'' On January 31,
2020, pursuant to section 319 of the Public Health Service (PHS) Act
(42 U.S.C. 247d), the Health and Human Services Secretary (the
Secretary) determined that a public health emergency (PHE) exists for
the United States to aid the nation's health care community in
responding to COVID-19 (hereafter referred to as the PHE for COVID-19).
On March 11, 2020, the WHO publicly declared COVID-19 a pandemic. On
March 13, 2020, President Donald J. Trump (the President) declared the
COVID-19 pandemic a national emergency. Effective October 23, 2020, the
Secretary renewed the January 31, 2020 determination that was
previously renewed on April 21, 2020 and July 23, 2020 that a PHE
exists and has existed since January 27, 2020.
The Administration is committed to ensuring that Americans have
access to a COVID-19 vaccine through Operation Warp Speed, a
partnership among components of the HHS, including the Centers for
Disease Control and Prevention (CDC), the Food and Drug Administration
(FDA), the National Institutes of Health (NIH), and the Biomedical
Advanced Research and Development Authority (BARDA). Operation Warp
Speed engages with private firms and other Federal agencies, including
the Department of Defense (DoD), Department of Agriculture, the
Department of Energy, and the Department of Veterans Affairs. Through
the work of the Federal Government and the private sector, Operation
Warp Speed seeks to accelerate the development, manufacture, and
distribution of a COVID-19 vaccine to the American people.
The CDC has reported that some people are at higher risk of severe
illness from COVID-19.\1\ These higher-risk categories include:
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\1\ https://www.cdc.gov/mmwr/volumes/69/wr/mm6915e3.htm.
Older adults, with risk increasing by age.
People who have serious chronic medical conditions such
as:
++ Obesity.
++ Cardiovascular disease.
++ Diabetes mellitus.
++ Hypertension.
++ Chronic lung disease.
++ Neurologic/Neurodevelopmental disability.\2\
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\2\ https://www.cdc.gov/mmwr/volumes/69/wr/mm6924e2.htm?s_cid=mm6924e2_w.
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++ Immunocompromised individuals.
Residents of Long Term Care (LTC) facilities, including
nursing homes, Intermediate Care Facilities for Individuals with
Intellectual and Developmental Disabilities (ICF/IIDs), inpatient
psychiatric and substance abuse treatment facilities including
Institutions for Mental Disease (IMDs) & Psychiatric Residential
Treatment Facilities (PRTFs), assisted living facilities, group homes
for individuals with developmental disabilities and board-and-care
facilities.\3\
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\3\ https://www.cdc.gov/coronavirus/2019-ncov/cases-updates/summary.html.
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As the health care community implements and updates recommended
prevention and control practices, regulatory agencies operating under
appropriate waiver authority granted by the PHE for COVID-19 are also
working to revise and implement regulations that support these health
care community infection prevention and treatment practices. Based on
the current and projected increases in the incidence rate of COVID-19
in the US, observed fatalities in the older adult population, and the
impact on health care workers at increased risk due to treating special
populations, CMS \4\ is reviewing and revising regulations, as
appropriate, to offer states, providers, suppliers, and group health
plans and health insurance issuers additional flexibilities in
furnishing and providing services to combat the PHE for COVID-19 and to
address and minimize the unique impact of the PHE for COVID-19 on other
regulatory provisions.
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\4\ Throughout this IFC, unless otherwise specified, ``we'' and
``our'' refer to CMS only.
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CMS addressed additional policies in three previous interim final
rules with comment period (IFCs). The ``Medicare and Medicaid Programs;
Policy and Regulatory Revisions in Response to the COVID-19 Public
Health Emergency'' IFC appeared in the April 6, 2020 Federal Register
(85 FR 19230) with an effective date of March 31, 2020, and the
``Medicare and Medicaid Programs, Basic Health Program, and Exchanges;
Additional Policy and Regulatory Revisions in Response to the COVID-19
Public Health Emergency and Delay of Certain Reporting Requirements for
the Skilled Nursing Facility Quality Reporting Program'' IFC appeared
in the May 8, 2020 Federal Register (85 FR 27550) with an effective
date of May 8, 2020. The ``Medicare and Medicaid Programs, Clinical
Laboratory Improvement Amendments, and Patient Protection and
Affordable Care Act: Additional Policy and Regulatory Revisions in
Response to the COVID-19 Public Health Emergency'' IFC appeared in the
September 2, 2020 Federal Register (85 FR 54820) with an effective date
of September 2, 2020.
This IFC implements a number of measures intended to further the
Administration's commitment to ensure every American has timely access
to a COVID-19 vaccine without any out-of-pocket expenses, no matter
their source of coverage, or whether they are covered at all.
[[Page 71144]]
In this IFC, CMS discusses Section 3713 of the Coronavirus Aid,
Relief, and Economic Security (CARES) Act which added the COVID-19
vaccine and its administration to section 1861(s)(10)(A) of the Social
Security Act (the Act) in the same subparagraph as the flu and
pneumococcal vaccines and their administration. It also specified that
under Medicare Part B, beneficiaries can receive a COVID-19 vaccination
(vaccine and administration) with no cost sharing (deductible or
copayment).
In this IFC, HHS and the Departments of Labor and the Treasury
(referred to collectively as ``the Departments'') clarify certain
aspects of coverage of preventive services without cost sharing under
the current regulations implementing section 2713 of the Public Health
Service (PHS) Act, as added by PPACA and incorporated into the Employee
Retirement Income Security Act of 1974 (ERISA) by section 715 of ERISA
and into the Internal Revenue Code (the Code) by section 9815 of the
Code. The Departments also amend those regulations to implement the
unique requirements related to rapid coverage of qualifying coronavirus
preventive services under section 3203 of the CARES Act. Specifically,
this IFC clarifies that plans and issuers subject to section 2713 of
the PHS Act must cover without cost sharing recommended immunizations
as well as the administration of such immunizations, regardless of how
the administration is billed. This IFC also defines qualifying
coronavirus preventive services consistent with the definition provided
in section 3203 of the CARES Act and clarifies that plans and issuers
subject to section 2713 of the PHS Act must cover recommended
immunizations for COVID-19 that are qualifying coronavirus preventive
services, even if not listed for routine use on the Immunization
Schedules of the CDC. Due to the urgent need to ensure coverage of and
access to qualifying coronavirus preventive services, and to ensure
that participants, beneficiaries, and enrollees can access qualifying
coronavirus preventive services on the expedited basis specified by
statute, this IFC also provides that during the PHE for COVID-19, plans
and issuers must cover, without cost sharing, qualifying coronavirus
preventive services, regardless of whether such services are delivered
by an in-network or out-of-network provider. This coverage is required
to be provided within 15 business days after the date the United States
Preventive Services Task Force (USPSTF) or the Advisory Committee on
Immunization Practices of the CDC (ACIP) makes an applicable
recommendation relating to a qualifying coronavirus preventive service.
Section 3202(b) of the CARES Act establishes a requirement to
publicize cash prices for COVID-19 diagnostic testing during the PHE.
For purposes of implementing section 3202(b) of the CARES Act, this IFC
adds a new 45 CFR part 182, including (1) definitions of ``provider of
a diagnostic test for COVID-19'' (or ``provider''), ``COVID-19
diagnostic test,'' and ``cash price,'' and (2) requirements for posting
cash price information on the internet, or upon request and through
signage (if applicable) if the provider does not have its own website.
This IFC gives CMS discretion to take any of the following actions,
which generally, but not necessarily, will occur in the following order
if CMS determines the provider is noncompliant with section 3202(b)(1)
of the CARES Act and the requirements of Sec. 182.40:
Provide a written warning notice to the provider of the
specific violation(s).
Request that a provider submit and comply with a
corrective action plan (CAP) under Sec. 182.60 if its noncompliance is
not corrected after a warning notice.
Impose a civil monetary penalty (CMP) on the provider if
the provider fails to respond to CMS' request to submit a CAP or to
comply with the requirements of a CAP approved by CMS.
This IFC creates a New COVID-19 Treatments Add-on Payment (NCTAP)
under the Inpatient Prospective Payment System (IPPS) for COVID-19
cases that meet certain criteria. We believe that as drugs and
biological products become available and are authorized or approved by
FDA for the treatment of COVID-19 in the inpatient setting, it is
appropriate to increase the current IPPS payment amounts to mitigate
any potential financial disincentives for hospitals to provide new
COVID-19 treatments during the PHE. Therefore, effective for discharges
occurring on or after the effective date of this rule and until the end
of the PHE for COVID-19, this IFC establishes the NCTAP to pay
hospitals the lesser of (1) 65 percent of the operating outlier
threshold for the claim or (2) 65 percent of the amount by which the
costs of the case exceed the standard DRG payment, including the
adjustment to the relative weight under section 3710 of the CARES Act,
for certain cases that include the use of a drug or biological product
currently authorized or approved for treating COVID-19. The NCTAP will
not be included as part of the calculation of the operating outlier
payments.
This IFC provides for separate payment for New COVID-19 Treatments
under the Outpatient Prospective Payment System (OPPS) for the
remainder of the PHE for COVID-19 when these treatments are provided at
the same time as a Comprehensive Ambulatory Payment Classification (C-
APC) service. Although we do not expect that many beneficiaries would
both receive a primary C-APC service and a drug or biological for
treating COVID-19 on the same claim, we nonetheless believe that as
drugs or biologicals become available and are authorized or approved
for the treatment of COVID-19 in the outpatient setting, it would be
appropriate to mitigate any potential financial disincentives for
hospitals to provide these new treatments during the PHE for COVID-19.
Therefore, effective for services furnished on or after the effective
date of this rule and until the end of the PHE, CMS is creating an
exception to its OPPS C-APC policy to ensure separate payment for new
COVID-19 treatments that meet certain criteria.
This IFC adds a new subpart G, Temporary FMAP Increase During the
Public Health Emergency for COVID-19, to 42 CFR part 433, including a
new Sec. 433.400. This new provision interprets and implements section
6008(b)(3) of the FFCRA to require states, as a condition for receiving
the temporary FMAP increase described at section 6008(a) of the FFCRA,
to maintain beneficiary enrollment with specified protections. The
terms of new Sec. 433.400 are effective immediately upon display of
this rule. CMS' previous interpretation, described in this preamble and
in the FAQs cited therein, continues to apply up to the date this rule
is effective.
This IFC modifies policies of the Comprehensive Care for Joint
Replacement (CJR) model and adds technical changes to accommodate these
policy changes. Specifically, we are extending Performance Year (PY) 5
an additional 6 months, creating an episode-based extreme and
uncontrollable circumstances COVID-19 policy, providing two
reconciliation periods for PY 5, and adding DRGs 521 and 522 for hip
and knee procedures.
This IFC provides for flexibilities in the public notice
requirements for a State Innovation Waiver (also referred to as a
section 1332 waiver) described in section 1332 of PPACA that apply
during the PHE for COVID-19. Specifically, this IFC gives the Secretary
of HHS and the Secretary of the Treasury the authority to modify, in
part, the public notice procedures to
[[Page 71145]]
expedite a decision on a proposed waiver request that is submitted or
would otherwise become due during the PHE for COVID-19. This IFC also
gives these Secretaries the authority to modify, in part, the post-
award public notice requirements for an approved waiver request that
would otherwise take place or become due during the PHE for COVID-19.
II. Provisions of the Interim Final Rule--Department of Health and
Human Services
A. Medicare Coding and Payment for COVID-19 Vaccine
1. Summary
This section of this IFC discusses CMS's implementation of section
3713 of the CARES Act, which established Medicare Part B coverage and
payment for a COVID-19 vaccine and its administration. While section
3713(e) of the CARES Act authorizes CMS to implement section 3713 via
``program instruction or otherwise,'' we believe it is important to
clarify in this IFC our interpretation of Section 3713 and ensure the
public is aware of our plans to ensure timely Medicare Part B coverage
and payment for COVID-19 vaccine and its administration.
2. Background on Medicare Part B Coverage, Payment, Coding and Billing
for Vaccines
As required under section 1842(o)(1)(A)(iv) of the Act, the
Medicare Part B payment allowance limits for influenza, pneumococcal,
and hepatitis B virus (HBV) vaccines are 95 percent of the Average
Wholesale Price (AWP) as reflected in the published compendia except
where the vaccine is furnished in a hospital outpatient department,
Rural Health Clinic (RHC), or Federally Qualified Health Center (FQHC),
skilled nursing facility, and home health. Where the vaccine is
furnished in these settings, payment for the vaccine is based on
reasonable cost.
For preventive vaccines described in section 1861(s)(10) of the
Act, Medicare pays for both the vaccine and its administration. Under
sections 1833(a)(1)(B), annual Part B deductible and coinsurance
amounts do not apply for these vaccinations. In 2020, payment for
vaccines is based on the 95 percent of the AWP for a particular vaccine
product except where furnished in the settings for which payment is
based on reasonable cost. For example, for the 2020-2021 influenza
season, payment limits for adult flu vaccines range from about $19 to
$61 per adult dose.\5\
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\5\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Part-B-Drugs/McrPartBDrugAvgSalesPrice/VaccinesPricing, accessed
September 29, 2020.
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We note that in the Calendar Year 2021 Physician Fee Schedule
Proposed Rule (85 FR 50162-50163), CMS proposed to increase the
Medicare payment rate for administration of the flu, pneumococcal or
HBV vaccine furnished by a physician, non-physician practitioner, or
other supplier. CMS will address public comments on the proposal and
establish payment rates for administration of these vaccines by a
physician, non-physician practitioner, or other supplier in the
Calendar Year 2021 Physician Fee Schedule Final Rule, which will be
issued later this year. Note that the payment rates for administration
of these preventive vaccines established in the CY 2021 Physician Fee
Schedule final rule do not apply when the vaccine is furnished by the
providers and suppliers paid for administration under reasonable cost.
Under the CY 2021 OPPS proposed rule, CMS proposed to assign the HCPCS
codes for administration of the influenza, pneumococcal, and hepatitis
B vaccines to APC 5691, Level 1 Drug Administration. See Addendum C to
the CY 2021 OPPS/ASC proposed rule. Payment amounts for these
preventive vaccines and their administration are not adjusted based on
product-specific factors.
Generally, providers and suppliers bill for the vaccine and the
vaccine administration separately using different codes. For example,
many vaccine products are identified by AMA CPT codes in the 90000
series, while others are identified by Level II HCPCS codes, usually
beginning with the letter Q. Vaccine administration services are
described by the types of codes used to describe professional and/or
hospital outpatient services, and are typically identified by a G code
for Medicare billing, or by a different AMA CPT code in the 90000
series.
Many providers, professionals, and other suppliers can bill
Medicare for the preventive vaccines and vaccine administration they
furnish using claims rules similar to those that apply to the other
Medicare covered items and services. Additionally, certain entities can
enroll under Medicare as mass immunizers to offer and bill Medicare for
flu vaccinations, pneumococcal vaccinations, or both to large groups of
Medicare beneficiaries under roster billing. A mass immunizer may be
enrolled in Medicare as another type of provider or supplier such as a
physician, non-physician practitioner, hospital outpatient department,
home health agency or skilled nursing facility. An entity or individual
that does not otherwise qualify as a Medicare provider or supplier but
wishes to furnish mass immunization services may be eligible to enroll
in Medicare as a ``Mass Immunization Roster Biller'' via the Form CMS-
855 enrollment application (Medicare Enrollment Application: Clinics/
Group Practices and Certain Other Suppliers; OMB Control No.: 0938-
0685; Expires 12/21). Aside from meeting all applicable enrollment
requirements in 42 CFR part 424, subpart P (and as outlined in CMS Pub.
100-08 (Program Integrity Manual), chapter 10, section 10.2.4), a party
enrolled only as a mass immunization roster biller must comply with the
following: (1) May not bill Medicare for any services other than
pneumococcal pneumonia vaccines (PPVs), influenza virus vaccines, and
their administration; (2) must submit claims through the roster biller
or centralized biller process; and (3) the enrolled entity or
individual must meet all applicable state and local licensure or
certification requirements. In other words, an enrolled mass immunizer
roster biller may only roster bill Medicare for the services described
in the previous sentence. (For more information on the enrollment
process for mass immunization roster billers, see https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/Become-a-Medicare-Provider-or-Supplier and/or contact your local Part A/B Medicare
Administrative Contractor.)
For entities that are already enrolled Medicare providers and
suppliers, these entities would contact their MAC if they plan to
submit claims as a mass immunizer. Mass immunizers may submit claims
for immunizations (vaccine and administration) on roster bills that
include a limited set of information on each beneficiary and the
vaccine(s) they were given. We note that HBV vaccinations require an
assessment of a patient's risk of contracting hepatitis B; they require
a physician's order and cannot be roster billed by mass immunizers.
3. Provisions of the CARES Act
Section 3713 of the CARES Act provides for coverage of the COVID-19
vaccine under Part B of the Medicare program without any beneficiary
cost sharing. Specifically, section 3713 amended section 1861(s)(10)(A)
of the Act to include COVID-19 vaccine and its administration. The
amendments made are effective on the date of
[[Page 71146]]
enactment and apply to a COVID-19 vaccine beginning on the date that
such vaccine is licensed under section 351 of the PHS Act (42 U.S.C.
262). Section 3713(e) of the CARES Act further states that the
Secretary may implement the provisions of, and the amendments made by,
this section by program instruction or otherwise.
Under section 564 of the Federal Food, Drug, and Cosmetic Act (FD&C
Act), the Commissioner of Food and Drugs, as delegated authority by the
Secretary, may authorize, during the effective period of a declaration
of emergency or threat justifying emergency authorized use, the
introduction into interstate commerce of unapproved medical products or
unapproved uses of approved medical products to diagnose, treat, or
prevent serious or life-threatening diseases or conditions caused by
chemical, biological, radiological and nuclear defense (CBRN) threat
agents when there are no adequate, approved, and available
alternatives. On March 27, 2020, on the basis of his determination of a
PHE that has a significant potential to affect national security or the
health and security of United States citizens living abroad involving
COVID-19, the Secretary declared that circumstances exist justifying
the authorization of emergency use of drugs and biological products
during the COVID-19 pandemic (85 FR 18250). Pursuant to this
declaration, the Commissioner of Food and Drugs, as delegated authority
by the Secretary, may issue an emergency use authorization (EUA) for a
drug or biological product if, after consultation with officials such
as the Director of the CDC and the Director of the NIH, to the extent
feasible and appropriate, the Commissioner reasonably concludes that,
among other criteria, based on the totality of available scientific
evidence, the product may be effective in diagnosing, treating or
preventing such disease or condition, and the product's known and
potential benefits when used to diagnose, prevent, or treat such
disease or condition, outweigh its known and potential risks.
FDA's June 2020 guidance to industry titled ``Development and
Licensure of Vaccines to Prevent COVID-19'' \6\ and October 2020
guidance to industry titled ``Emergency Use Authorization for Vaccines
to Prevent COVID-19'' \7\ state that issuance of an EUA may be
appropriate for a COVID-19 vaccine, for which there is adequate
manufacturing information, once studies have demonstrated the safety
and effectiveness of the vaccine in a clear and compelling manner, but
before the submission and/or formal review of the biologics license
application for the vaccine. These guidance documents state that in the
case of vaccines being developed for the prevention of COVID-19, any
assessment regarding an EUA would be made on a case by case basis
considering the target population, the characteristics of the product,
the preclinical and human clinical study data on the product, and the
totality of the relevant available scientific evidence. The FDA has
made clear in its October 2020 guidance to industry that for a COVID-19
vaccine for which there is adequate information to ensure its quality
and consistency, issuance of an EUA would require a determination by
FDA that the vaccine's benefits outweigh its risks based on data from
at least one well-designed Phase 3 clinical trial that demonstrates the
vaccine's safety and efficacy in a clear and compelling manner. Because
the vaccine would be intended for administration to healthy people as a
prophylactic measure, there must be a higher degree of certainty about
the risks and benefits of the product than needed for EUAs for medical
products intended for treatment of sick patients.
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\6\ Available at https://www.fda.gov/regulatory-information/search-fda-guidance-documents/development-and-licensure-vaccines-prevent-covid-19, accessed September 30, 2020.
\7\ Available at https://www.fda.gov/regulatory-information/search-fda-guidance-documents/emergency-use-authorization-vaccines-prevent-covid-19, accessed October 9, 2020.
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There are no historical examples in which Medicare has covered
vaccines for which an EUA was issued by FDA. We recall that during the
PHE involving the 2009 H1N1 flu outbreak,\8\ Influenza A (H1N1) 2009
Monovalent Vaccine was approved by the FDA on September 15, 2009 on the
basis of a supplement to the applicant's biologics license application
(BLA) for influenza virus vaccine.\9\ In our review of PHEs, there are
no circumstances in which a vaccine product authorized for emergency
use has been covered or paid for by Medicare.
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\8\ Available at https://www.phe.gov/emergency/news/healthactions/phe/Pages/h1n1.aspx, accessed on October 14, 2020.
\9\ Available at https://www.fda.gov/vaccines-blood-biologics/vaccines/influenza-h1n1-2009-monovalent-vaccine-novartis-vaccines-and-diagnostics-limited, accessed October 14, 2020.
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As discussed previously, the CDC recognizes that the categories of
people at higher risk of severe illness from COVID-19 include older
adults (with risk increasing by age), people with chronic conditions
such as cardiovascular disease or diabetes, and residents of long-term
care facilities.\10\ The Medicare population includes many
beneficiaries who are in these higher-risk categories, primarily
because most, (over 85 percent) \11\ Medicare beneficiaries are over 65
years old. Given the high risk nature of the Medicare population, the
circumstances of this nationwide pandemic, and FDA's guidance that an
EUA may be appropriate for a COVID-19 vaccine prior to its licensure if
there is a demonstration of safety and efficacy in a clear and
compelling manner from at least one Phase 3 clinical trial, we believe
it is appropriate for Medicare to consider any EUA under section 564 of
the FD&C Act issued for a COVID-19 vaccine during the PHE to be
tantamount to a license under section 351 of the PHS Act for the sole
purpose of considering such a vaccine to be described in section
1861(s)(10)(A) of the Act. That is, even though section 3713 of the
CARES Act refers to a COVID-19 vaccine ``licensed under section 351 of
the PHS Act,'' CMS could consider any vaccine for which FDA issued an
EUA during the PHE, when furnished consistent with terms of the EUA, to
be eligible for Medicare coverage and payment. We consider our
interpretation of section 3713(d) of the CARES Act to be consistent
with Congress' intent to provide for Medicare coverage without
deductible or coinsurance of any COVID-19 vaccine (and its
administration) that FDA has authorized to be introduced into
interstate commerce, which would be the case both for a vaccine for
which emergency use is authorized under section 564 of the FD&C Act and
for a vaccine that is licensed under section 351 of the PHS Act. Our
interpretation also would be consistent with Congress' general intent
in the CARES Act and other recent legislation to provide for rapid
coverage of COVID-19 vaccines.
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\10\ https://www.cdc.gov/coronavirus/2019-ncov/need-extra-precautions/?CDC_AA_refVal=https%3A%2F%2Fwww.cdc.gov%2Fcoronavirus%2F2019-ncov%2Fneed-extra-precautions%2Fpeople-at-increased-risk.html.
\11\ https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Beneficiary-Snapshot/Downloads/Bene_Snaphot.pdf.
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We note that section 3713(e) of the CARES Act permits CMS to
implement the changes made by that section through ``program
instruction or otherwise,'' and we intend to issue any necessary
instructions for Medicare providers and suppliers expediently in order
to ensure beneficiary access to COVID-19 vaccines as quickly as
possible.
[[Page 71147]]
4. Implementation and Methods of Coding and Payment for COVID-19
Vaccine and Administration
Section 3713 of the CARES Act added the COVID-19 vaccine and its
administration to section 1861(s)(10)(A) of the Act in the same
subparagraph as the flu and pneumococcal vaccines and their
administration. As such, the Medicare allowed amount for the COVID-19
vaccine will also be 95 percent of the average wholesale price (or
reasonable cost, for example under OPPS).
Because COVID-19 vaccines are being developed rapidly and systems
to operationalize payment of administration will need to be implemented
quickly to ensure beneficiary access, we also recognize the need to
establish coding and payment for COVID-19 vaccine and administration
under Medicare Part B. Because there are many product-specific factors
that are still unknown, including the possibility of differential costs
associated with each COVID-19 vaccine product and storage and
administration requirements, we anticipate establishing a unique
administration code for each COVID-19 vaccine product. We believe it is
imperative that coding and payment be in place as soon as possible
after COVID-19 vaccines become available. We anticipate establishing
specific coding and payment rates through technical direction to the
MACs, including instructions to make this information available to the
public. We also anticipate posting information on coding, payment, and
billing for COVID-19 vaccines and vaccine administration on the CMS
website. This approach will maintain public transparency while allowing
CMS to pay appropriately for particular vaccines and vaccine
administration as quickly as practicable once they are authorized or
licensed for use by FDA. We anticipate that payment rates for the
administration of other Part B preventive vaccines and related
services, such as the flu and pneumococcal vaccines, would serve to
inform the payment rates for administration of COVID-19 vaccines.
CMS ordinarily establishes Medicare payment rates for particular
items and services, through notice-and-comment rulemaking. Because of
the unique circumstances of the PHE for COVID-19 pandemic and the
anticipated, specific conditions for the entry of COVID-19 vaccine
products into the marketplace, we believe it is necessary to initially
dispense with the rulemaking process in order to make Medicare payment
available in a timely manner to ensure widespread access to the new
vaccines. Therefore, as soon as practicable after the authorization or
licensure of each COVID-19 vaccine product by FDA, we will announce the
interim coding and a payment rate for its administration (or, in the
case of the OPPS, an APC assignment for each vaccine product's
administration code), taking into consideration any product-specific
costs or considerations involved in furnishing the service. Such
consideration may be necessary, specifically for COVID-19 vaccines in
the context of the pandemic, in order to ensure that health care
providers can offer prompt access to vaccination for a large number of
people as quickly as possible. We then anticipate addressing coding and
payment rates for administration of the COVID-19 vaccine products
through future notice-and-comment rulemaking. In other words, the
approach to payment and coding described in this IFC will ensure
efficient and timely beneficiary access to COVID-19 vaccine products,
that for public health purposes may need to be administered to a large
number of people during a compressed period of time, until further
rulemaking, such as annual rulemaking under the Medicare Physician Fee
Schedule, is possible.
Given that the COVID-19 vaccine and administration was added to the
same subparagraph as the flu and pneumococcal vaccines and
administration under section 1861(s)(10)(A) of the Act, we believe it
would be appropriate to use billing processes for COVID-19 vaccinations
that are similar to those in place for flu and pneumococcal
vaccinations. With the pressing need to ensure broad access to a COVID-
19 vaccine, it would be appropriate to allow COVID-19 vaccinations to
be provided through the mass immunization and roster billing process
that is in place for flu and pneumococcal vaccinations. We recognize
that, at this time, there is very limited detailed information on
COVID-19 vaccines and their administration and that information on
these vaccines is likely to evolve as they reach the market and then
experience with them is gained. At this time, we believe that the
COVID-19 vaccines will be administered as one or two parenteral doses,
thus we believe that using the Part B influenza vaccination approach
that permits certain providers and mass immunization to bill for the
product strikes a balance between the need to vaccinate many millions
of Medicare patients promptly and the lack of detailed information
about particular COVID-19 vaccine products. Although influenza
vaccination is generally only given once each flu season, CMS has
contemplated how to respond to pandemics where payment for additional
doses of an influenza vaccine during a season may be required. Thus, a
two dose initial COVID-19 vaccination schedule can be accommodated
under this general approach. Also, the CARES Act permits the Secretary
to implement the provisions of, and the amendments made by, section
3713 by program instruction or otherwise. As information about vaccine
products becomes available, we anticipate that updated information, for
example information concerning additional doses after initial
vaccination, applicability of specific vaccine products to subsets of
our beneficiary population, or updates about billing would be
disseminated primarily by program instruction.
As part of this IFC, we are updating the following regulations:
At Sec. 410.57, Pneumococcal vaccine and flu vaccine, we
are amending the section heading and adding a new paragraph to
reference COVID-19 vaccine.
At Sec. 410.152, Amounts of payment, we are amending
Sec. 410.152(l)(1) to include the COVID-19 vaccine in the list of
vaccines for which Medicare Part B pays 100 percent of the Medicare
payment amount.
At Sec. 410.160, Part B annual deductible, we are
amending Sec. 410.160(b)(2) to include the COVID-19 vaccine in the
list of vaccines that are not subject to the Part B annual deductible
and do not count toward meeting that deductible.
At Sec. 411.15, Particular services excluded from
coverage, we are amending Sec. 411.15(e) to add an exception for
COVID-19 vaccinations to the general exclusion of coverage for
immunizations.
At Sec. 414.701, Purpose, we are amending the list of
statutorily covered drugs to include the COVID-19 vaccine.
At Sec. 414.707, Basis of Payment, we are amending Sec.
414.707(a)(2)(iii) to include the COVID-19 vaccine in the list of
vaccines with a payment limit calculated using 95 percent of the
average wholesale price.
At Sec. 414.900, Basis and scope, we are amending Sec.
414.900(b)(3) to include the COVID-19 vaccine in the list of
statutorily covered drugs.
At Sec. 414.904, Average sales price as the basis for
payment, we are amending Sec. 414.904(e)(1) to include the COVID-19
vaccine in the list of vaccines with payment limits calculated using 95
percent of the average wholesale price.
[[Page 71148]]
5. Medicare Advantage and Cost Plans
Under sections 1852(a)(1) and 1876(c)(2) of the Act, Medicare
Advantage (MA) plans and cost plan organizations must cover all
benefits covered under Part A and Part B of Original Medicare, subject
to limited exclusions. Therefore, all MA plans and cost plans must
cover a COVID-19 vaccine and its administration described in section
1861(s)(10)(A) of the Act. As described previously, the interpretation
of section 3713 of the CARES Act adopted in this rule will result in
Part B coverage of a COVID-19 vaccine for which FDA issues an EUA
during the PHE, and administration of that vaccine when furnished
consistent with terms of such EUA. As amended by section 3713 of the
CARES Act, section 1852(a)(1)(B)(iv)(VI) of the Act prohibits MA plans
from using cost sharing that exceeds the cost sharing imposed under
original Medicare for a COVID-19 vaccine and its administration when MA
coverage is provided because they are covered under Part B under
section 1861(s)(10)(A) of the Act.
Section 1852(a)(5) of the Act and 42 CFR 422.109 provide that when
a National Coverage Determination (NCD) or legislative change in
benefits, such as the addition of Part B coverage of a COVID-19 vaccine
and its administration, results in significant costs that have not been
included in the capitation payments made to MA plans, coverage of the
new benefit will be provided through the Medicare FFS program until the
capitation payments take the new significant costs into account. The
payment rates for MA organizations for contract years 2020 and 2021
have been set without including the costs for a COVID-19 vaccine and
its administration. Therefore, if coverage of a COVID-19 vaccine and
its administration during that period results in significant costs,
section 1852(a)(5) of the Act and Sec. 422.109 will apply to require
Medicare FFS coverage of the vaccine and its administration.
The cost projection used for the determination whether the
legislative change results in significant costs is based on an analysis
by the Chief Actuary of CMS of the actuarial costs associated with a
NCD or the legislative change in benefits and compared to the
thresholds specified in the regulation at Sec. 422.109. This analysis
is generally performed once a Medicare FFS payment rate is determined
for the service. If the estimated cost of an NCD or legislative change
represents at least 0.1 percent of the national average per capita
costs or the average cost of furnishing a single service exceeds the
cost threshold established in using the formula in Sec. 422.109(a), it
is considered a significant cost and the FFS Medicare program provides
coverage for the service until the costs are factored into Medicare
Advantage payments. Therefore, this legislative change would be subject
to an analysis whether the new benefit results in significant costs.
The significant cost threshold will be met assuming that the projected
cost per-beneficiary-per-year is greater than approximately $13, which
is 0.1 percent of the national average per capita costs. If the
threshold is reached, Medicare beneficiaries enrolled in MA plans will
receive coverage of the COVID-19 vaccine and its administration through
the Medicare FFS program and would be able to access the COVID-19
vaccine, without cost sharing, at any FFS provider or supplier that
participates in Medicare and is eligible to bill under Part B for
vaccine administration, including those enrolled in Medicare as a mass
immunizer or a physician, non-physician practitioner, hospital, clinic,
or group practice.
Section 3713 of the CARES Act added Medicare Part B coverage for a
COVID-19 vaccine and its administration and provides that MA plans must
cover the new benefit without cost sharing. While section 1876(c)(2) of
the Act ensures that enrollees in Medicare cost plans will have
coverage of a COVID-19 vaccine and its administration, section 3713 of
the CARES Act did not amend section 1876 of the Act to provide similar
cost-sharing protections for enrollees in cost plans who receive the
vaccine from an in-network provider. Nor is there a provision
affirmatively relieving cost plans of the obligation to cover the new
Part B benefit. Because the Medicare FFS program covers Part A and Part
B items and services furnished to cost plan enrollees by out-of-network
health care providers that participate in the Medicare FFS program,
cost plan enrollees will receive the COVID-19 vaccine and its
administration without cost sharing when they go to a health care
provider that is out of the cost plan's network. See 42 CFR
417.436(a)(5) and 417.448. However, there is no requirement for cost
plans to cover the COVID-19 vaccine and its administration without cost
sharing (that is, with cost sharing that is the same as original
Medicare) when the vaccine is furnished by an in-network health care
provider. Many enrollees may seek the COVID-19 vaccine from the health
care provider they usually see or from whom they receive most of their
health care; that provider is likely to be in-network with the cost
plan. CMS believes that it is necessary and appropriate to ensure that
cost plan enrollees, like other Medicare beneficiaries, are provided
access to the COVID-19 vaccine and its administration without cost
sharing. Section 1876(i)(3)(D) of the Act authorizes us to impose
``other terms and conditions not inconsistent with [section 1876]''
that are deemed ``necessary and appropriate.'' Requiring cost plans to
comply with the same cost sharing protections available to Medicare
beneficiaries in the FFS program and enrolled in Medicare Advantage
plans is necessary and appropriate, so that cost is not a barrier for
beneficiaries to get the vaccine, particularly during the public health
emergency when ensuring access is of paramount importance. To ensure
that cost plan enrollees also do not pay cost sharing for the COVID-19
vaccine and its administration when received from an in-network
provider at least until the end of the public health emergency for
COVID-19, we are adding a new paragraph (e)(4) to Sec. 417.454 to
require section 1876 cost plans to cover without cost sharing the
COVID-19 vaccine and its administration described in section
1861(s)(10)(A) of the Act without cost sharing for the duration of the
PHE for the COVID-19 pandemic, specifically the end of the emergency
period defined in paragraph (1)(B) of section 1135(g) of the Act, which
is the PHE declared by the Secretary on January 31, 2020 and any
renewals thereof.
B. COVID-19 Vaccine Coverage for Medicaid, CHIP, and BHP Beneficiaries
Under section 6008 of the FFCRA, states' and territories' Medicaid
programs may receive a temporary 6.2 percentage point increase in the
Federal Medical Assistance Percentage (FMAP). Under section 6008(b)(4)
of the FFCRA, to receive that increase, a state or territory must cover
COVID-19 testing services and treatments, including vaccines and the
administration of such vaccines, for Medicaid enrollees without cost
sharing. That coverage is required during any quarter for which the
state or territory claims the temporary FMAP increase under FFCRA
section 6008, and the FMAP increase is available through the end of the
quarter in which the PHE for COVID-19 ends. CMS is not aware of any
states or territories not currently claiming this temporary FMAP
increase, or of any state or territory that intends to cease claiming
it. Accordingly, Medicaid coverage of a COVID-19 vaccine and its
administration, without cost-sharing, is expected to be available for
most
[[Page 71149]]
Medicaid beneficiaries through the end of the quarter in which the PHE
for COVID-19 ends. For the remainder of this section of preamble,
references to ``state'' or ``states'' in discussions of Medicaid policy
also include the territories.
To meet the requirement in FFCRA section 6008(b)(4) to cover a
COVID-19 vaccine and its administration without cost sharing, states
must compensate Medicaid providers with a vaccine administration fee or
reimbursement for a provider visit during which a vaccine dose is
administered, even if the vaccine dose is furnished to the provider at
no cost.
There are some very limited circumstances in which the FFCRA
section 6008(b)(4) coverage requirements would not apply. CMS has not
interpreted section 6008(b)(4) of the FFCRA to require that state
Medicaid programs cover the services described in that provision for
individuals whose Medicaid eligibility is limited by statute to only a
narrow range of benefits that would not otherwise include these
services. FFCRA section 6008(b)(4) did not amend the varying benefits
packages that are required for different Medicaid eligibility groups
under section 1902(a)(10) of the Act. In some cases, beneficiaries'
coverage is limited by statute to a very narrow range of benefits and
services that typically would not include services described in FFCRA
section 6008(b)(4), such as COVID-19 vaccines or their administration
(see, e.g., the limitations described in the matter following section
1902(a)(10)(G) of the Act for some Medicaid eligibility groups). Nor
did FFCRA section 6008(b)(4) direct states to amend existing
demonstration projects under section 1115(a) of the Act, through which
states may offer eligibility to groups not otherwise eligible under
title XIX of the Act, and can opt to provide these groups with limited
benefits. Moreover, after FFCRA was enacted, in section 3716 of the
CARES Act (Pub. L. 116-136), Congress defined eligibility for the
COVID-19 testing-only optional Medicaid eligibility group described in
section 1902(a)(10)(A)(ii)(XXIII) of the Act in a manner that
recognized that certain limited-benefit Medicaid eligibility groups are
``uninsured,'' and therefore eligible to receive coverage for COVID-19
testing under that provision, without referring to or acknowledging the
FFCRA section 6008(b)(4) COVID-19 testing coverage requirement. See
section 1902(ss) of the Act. Accordingly, CMS does not interpret FFCRA
section 6008(b)(4) to require states to provide COVID-19 testing and
treatment services without cost-sharing, including vaccines and their
administration, to eligibility groups whose coverage is limited by
statute or under an existing section 1115 demonstration to a narrow
range of benefits that would not ordinarily include this coverage, such
as groups that receive Medicaid coverage only for COVID-19 testing,
family planning services and supplies, or tuberculosis-related
services. The COVID-19 Claims Reimbursement to Health Care Providers
and Facilities for Testing and Treatment of the Uninsured Program
(COVID-19 Claims Reimbursement program) administered by the Health
Resources and Services Administration (HRSA) is available for
reimbursement of a COVID-19 vaccine and vaccine administration costs
for individuals who would not receive Medicaid coverage for a COVID-19
vaccine or its administration because their Medicaid coverage is for
limited benefit packages only.
After the requirements in section 6008(b)(4) of FFCRA are no longer
in effect in a state, the state must cover COVID-19 vaccines
recommended by the ACIP, and their administration, for several
populations under existing statutory and regulatory authority. All
Medicaid-enrolled children under the age of 21 eligible for the Early
and Periodic Screening, Diagnostic and Treatment (EPSDT) benefit must
receive ACIP-recommended vaccines pursuant to section 1905(r)(1)(A)(i)
and (B)(iii) of the Act.\12\ Coverage of ACIP-recommended vaccines
without cost-sharing is required for any adult populations who receive
coverage through Alternative Benefit Plans (ABPs), including the adult
expansion population described at section 1902(a)(10)(A)(i)(VIII) of
the Act, pursuant to section 1937(b)(5) of the Act, 42 CFR 440.347(a),
and 45 CFR 156.115(a)(4) and 147.130. Some states may also elect to
receive a 1 percentage point FMAP increase for their expenditures on
certain services, in return for covering ACIP-recommended vaccines and
their administration without cost-sharing for adults under section
1905(a)(13) of the Act, pursuant to section 4106 of PPACA (as codified
in section 1905(b) of the Act). Children through age 18 who are
eligible for Medicaid (funded through both titles XIX and XXI), as well
as children who are uninsured, who are not insured with respect to the
vaccine and who are administered pediatric vaccines by a federally
qualified health center (FQHC) or rural health clinic, or who are
Indians (as defined in section 4 of the Indian Health Care Improvement
Act) receive ACIP-recommended vaccinations through the Vaccines for
Children (VFC) program, described at section 1928 of the Act. The
Centers for Disease Control and Prevention (CDC) will determine if
COVID-19 vaccines will be included in the VFC program. Coverage of the
administration of a VFC-covered vaccine for Medicaid-eligible children
would be provided by the state Medicaid program.
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\12\ Medicaid enrolled children up to the age of 18 are
generally exempt from cost sharing. For children age 19 or 20 cost
sharing for an ACIP-recommended vaccine may apply, outside of an
Alternative Benefit Plan.
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After the FFCRA section 6008(b)(4) requirements are no longer in
effect in a state, the state also has the option to cover a COVID-19
vaccine and its administration for other eligibility groups. Such
groups include the parent/caretaker relative eligibility group at 42
CFR 435.110, eligibility groups for individuals who are age 65 or older
or who are eligible on the basis of blindness or a disability, and
pregnant women enrolled under 42 CFR 435.116 who are eligible for full
state plan benefits. If a state elects to cover a COVID-19 vaccine and
its administration for any one of these groups, it must do so for all
of them, except that with respect to the pregnant women group described
in 42 CFR 435.116, per 42 CFR 440.250(p) states can cover a vaccine and
its administration as a pregnancy-related service while not providing
the same coverage for the other eligibility groups. Outside of the
period in which FFCRA section 6008(b)(4) applies to a state, the state
has the option to apply cost sharing to coverage of a COVID-19 vaccine
or its administration unless the beneficiary is in an eligibility group
that is exempt from cost-sharing under section 1916 or section 1916A of
the Act and regulations at 42 CFR 447.56 (for example, most children
under age 18, most pregnant women, most children in foster care,
individuals receiving services in an institution that already had their
medical assistance reduced by their income, individuals receiving
hospice care, and Indians who are currently receiving or have ever
received an item or service furnished by an Indian health care provider
or through referral under contract health services).
After the FFCRA section 6008(b)(4) requirements are no longer in
effect in a state, a COVID-19 vaccine and its administration could also
be a covered service for many Medicaid eligibility groups when
furnished by a participating provider under certain Medicaid benefits
that are mandatory for many Medicaid eligibility groups,
[[Page 71150]]
depending on how the state has defined the amount, duration, and scope
parameters of the benefit. Because inpatient and outpatient hospital
services, physician services, and Federally Qualified Health Center and
Rural Health Clinic services are mandatory Medicaid benefits for the
categorically needy populations, COVID-19 vaccine administration could
be a covered service for many Medicaid beneficiaries when provided by
these participating providers, at state option. States might also cover
COVID-19 vaccine administration for beneficiaries under various
optional state plan benefits, such as the ``other licensed
practitioner'' benefit described in section 1905(a)(6) of the Act and
42 CFR 440.60, or the ``preventive services'' benefit described in
section 1905(a)(13) of the Act and 42 CFR 440.130(c). However, states
would generally not have the option to cover a COVID-19 vaccine or its
administration for any group whose coverage is limited by statute or
under a current section 1115 demonstration to a narrow range of
benefits that would not ordinarily include vaccine coverage. As
described above, the COVID-19 Claims Reimbursement program administered
by HRSA may be used to cover COVID-19 treatment, including the
administration of vaccines, for such limited-benefit beneficiaries. In
addition, a state might have the option, subject to Federal approval,
to propose or amend a section 1115 demonstration to include this
coverage for a group that would not otherwise be entitled to receive it
under the statute or under current section 1115 authority.
The FFCRA section 6008(b)(4) requirement does not apply to separate
CHIPs.\13\ In separate CHIPs, states must cover ACIP-recommended
vaccines and their administration for all children under age 19 with no
cost sharing. See section 2103(c)(1)(D) and (e)(2) of the Act, and 42
CFR 457.410(b)(2) and 457.520(b)(4). Coverage of uninsured pregnant
women in a separate CHIP is optional. Currently, the states that cover
pregnant women in a separate CHIP include all ACIP-recommended vaccines
with no cost sharing in this coverage. However, current CMS
interpretation is that this vaccine coverage is not required.
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\13\ In states that use title XXI funding to expand Medicaid
eligibility for children, the FFCRA section 6008(b)(4) requirements
apply to these title XXI funded Medicaid beneficiaries in the same
way that they do to all other Medicaid beneficiaries.
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The FFCRA section 6008(b)(4) requirement also does not apply to the
Basic Health Program (BHP). Minnesota and New York are the only states
that currently operate a BHP. BHP coverage must include benefits in at
least the ten essential health benefits described in section 1302(b) of
the PPACA and must comply with the Exchange's cost-sharing
protections,\14\ which includes providing all ACIP recommended vaccines
without cost sharing. See sections 1331(a)(1), (a)(2)(B) and (b)(2) of
PPACA, and 42 CFR 600.405(a) and 600.510(b).
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\14\ As explained in rulemaking, this includes the prohibition
on cost sharing for preventive health services. See the Basic Health
Program: State Administration of Basic Health Programs; Eligibility
and Enrollment in Standard Health Plans; Essential Health Benefits
in Standard Health Plans; Performance Standards for Basic Health
Programs; Premium and Cost Sharing for Basic Health Programs;
Federal Funding Process; Trust Fund and Financial Integrity; Final
Rule. 79 FR 14111 at 14128 (March 12, 2014).
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Section 600.510(b) cross-references 45 CFR 147.130, which
establishes requirements related to the coverage of preventive health
services for BHP. For ABPs, 42 CFR 440.347 cross-references 45 CFR part
156, which incorporates 45 CFR 147.130, which establishes requirements
related to the coverage of preventive health services. Consistent with
the changes to 45 CFR 147.130 made through this rulemaking, during the
COVID-19 public health emergency BHP plans and Medicaid ABPs must
provide coverage for and must not impose any cost-sharing for
``qualifying coronavirus preventive services,'' including a COVID
vaccine, regardless of whether the vaccine is delivered by an in-
network or out-of-network provider. For details on the coverage
requirements for ``qualifying coronavirus preventive services'' and the
updates to 45 CFR 147.130 see section III of this IFC.
Lastly, we note that CMS intends this section only to be a
description of current policy and existing law, with the exception
noted directly above for BHP and Medicaid ABPs, and that CMS is not
making any changes to its current policy or regulatory requirements in
this rule.
C. Price Transparency for COVID-19 Diagnostic Tests
1. Introduction
Robust COVID-19 diagnostic testing is fundamental to the Federal
Government's strategy for controlling the spread of COVID-19.\15\ In
recognition of the importance of COVID-19 diagnostic testing, the
Federal Government has taken several steps to reduce financial barriers
to testing for both insured and uninsured individuals, including the
following:
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\15\ The White House, CDC and FDA document: Testing Overview,
Opening Up America Again. Available at: https://www.whitehouse.gov/wp-content/uploads/2020/04/Testing-Overview-Final.pdf.
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The FFCRA was enacted on March 18, 2020. Section 6001 of
the FFCRA generally requires group health plans and health insurance
issuers offering group or individual health insurance coverage to
provide coverage for certain items and services, including in vitro
diagnostic testing products for the detection of SARS-CoV-2, the virus
that causes COVID-19, or the diagnosis of COVID-19 (referred to herein
collectively as COVID-19 diagnostic tests) when those items or services
are furnished on or after March 18, 2020, and during the PHE for COVID-
19. Plans and issuers must provide this coverage without imposing any
cost-sharing requirements (including deductibles, copayments, and
coinsurance) or prior authorization or other medical management
requirements. Related items and services include those provided during
urgent care center visits, in-person and telehealth office visits, and
emergency room visits that result in an order for or administration of
an in vitro diagnostic product, to the extent that such items and
services relate to the furnishing or administration of a COVID-19
diagnostic test, or to the evaluation of an individual for purposes of
determining the need of the individual for a COVID-19 diagnostic test.
Section 3201 of the CARES Act, enacted on March 27, 2020, amended
section 6001 of the FFCRA to include a broader range of diagnostic
tests that plans and issuers must cover without any cost-sharing
requirements or prior authorization or other medical management
requirements.
The COVID-19 Claims Reimbursement to Health Care Providers
and Facilities for Testing and Treatment of the Uninsured Program
provides reimbursements on a rolling basis directly to eligible
providers for claims that are attributed to the testing and treatment
of COVID-19 for certain uninsured individuals. The program is funded
via (1) the FFCRA Relief Fund, which includes funds received from the
Public Health and Social Services Emergency Fund, as appropriated in
the FFCRA and the Paycheck Protection Program and Health Care
Enhancement Act (PPPHCEA) (Pub. L. 116-139), which each appropriated
funding to reimburse providers for conducting COVID-19 testing for the
uninsured, and (2) the Provider Relief Fund, as appropriated in the
CARES Act and the PPPHCEA.\16\
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\16\ FAQs for COVID-19 Claims Reimbursement to Health Care
Providers and Facilities for Testing and Treatment of the Uninsured.
Available at https://www.hrsa.gov/coviduninsuredclaim/frequently-asked-questions.
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[[Page 71151]]
HHS has partnered with pharmacies, retail companies, and
health centers nationwide to make no-cost COVID-19 diagnostic testing
available to Americans in communities across the country.\17\
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\17\ Information on Community-Based Testing Sites for COVID-19
can be found at https://www.hhs.gov/coronavirus/community-based-testing-sites/.
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Congress has also taken steps to facilitate the reimbursement for
COVID-19 diagnostic testing and to ensure that pricing for performance
of such testing is publicly available. Specifically, section 3202(a) of
the CARES Act requires group health plans and issuers providing
coverage for items and services described in section 6001(a) of the
FFCRA to reimburse any provider of a COVID-19 diagnostic test an amount
that equals the negotiated rate, or, if the plan or issuer does not
have a negotiated rate with the provider, the cash price for such
service that is listed by the provider on a public website. The plan or
issuer may also negotiate a rate with the provider that is lower than
the cash price. More information related to health insurance issuer and
group health plan coverage and reimbursement for COVID-19 diagnostic
testing is available at https://www.cms.gov/files/document/FFCRA-Part-42-FAQs.pdf and https://www.cms.gov/files/document/FFCRA-Part-43-FAQs.pdf. Specifically, the Departments note that the reimbursement
requirements under CARES Act 3202(a) will apply to COVID-19 diagnostic
testing, as defined in this IFC.
Section 3202(b) of the CARES Act establishes a requirement for each
provider of a diagnostic test for COVID-19 to publicize cash prices for
such COVID-19 diagnostic testing. Specifically, section 3202(b)(1) of
the CARES Act requires each provider of a diagnostic test for COVID-19
to make public the cash price for such test on a public internet
website of such provider during the emergency period declared under
section 319 of the PHS Act. Section 3202(b)(2) of the CARES Act
authorizes the Secretary to impose a civil monetary penalty (CMP) on
any provider of a diagnostic test for COVID-19 that does not make
public its cash price for such test in compliance with section
3202(b)(1) of the CARES Act and that has not completed a corrective
action plan (CAP) to comply with that section. The statute states that
the amount of the CMP must not exceed $300 per day that the violation
is ongoing.
We believe that cash price posting by providers of diagnostic tests
for COVID-19 is important for not only for plans and issuers that must
comply under section 3202(a) of the CARES Act but also for individuals
who seek COVID-19 diagnostic testing.
Therefore, we are adopting in this IFC policies that implement the
requirement in section 3202(b) of the CARES Act that providers of
diagnostic tests for COVID-19 make public their cash price for such
tests on the internet. Specifically, we are finalizing the following:
(1) Definitions of ``provider of a diagnostic test for COVID-19''
(herein referred to as ``provider''), ``diagnostic test for COVID-19''
(herein referred to as ``COVID-19 diagnostic test''), and ``cash
price''; (2) requirements for making public cash prices; and (3)
penalties for non-compliance with the cash price posting requirements.
2. Requirement That Providers of COVID-19 Diagnostic Tests Make Public
Cash Prices for COVID-19 Diagnostic Tests
The rapid expansion of COVID-19 related diagnostic testing capacity
is a top priority in HHS' strategy to combat the pandemic. COVID-19
diagnostic testing is generally performed by laboratories located in a
variety of sites, including for example: Government labs; hospital-run
labs; clinician offices; stand-alone labs; urgent care centers; and
pharmacies. There are several types of COVID-19 tests designed to
detect SARS-CoV-2 or to diagnose a possible case of COVID-19, including
molecular (RT-PCR) tests, which are used to detect the virus's genetic
material, and antigen tests, which are used to detect specific proteins
on the surface of the virus and serology testing, which is used to look
for the presence of antibodies produced by the body in response to
infections.
For purposes of implementing section 3202(b) of the CARES Act, we
are adopting a new 45 CFR part 182, ``Price Transparency for COVID-19
Diagnostic Tests,'' that will implement price transparency requirements
for making public cash prices for performance of a COVID-19 diagnostic
test. Section 182.10 states that part 182 implements section 3202(b) of
the CARES Act.
For purposes of section 6001(a)(1) of the FFCRA, as amended by
section 3201 of the CARES Act, and as explained in guidance issued by
the Departments, COVID-19 diagnostic tests include all in vitro
diagnostic tests, which include molecular, antigen, and serological
tests. Specifically, section 6001(a) of the FFCRA, as amended by
section 3201 of the CARES Act, requires plans and issuers to provide
coverage for an in vitro diagnostic test, as defined in 21 CFR 809.3(a)
(or its successor regulations), for the detection of SARS-CoV-2 or
diagnosis of COVID-19, and the administration of such a test that: (1)
Is approved, cleared, or authorized under section 510(k), 513, 515, or
564 of the FD&C Act (21 U.S.C. 360(k), 360c, 360e, 360bbb-3); (2) the
developer has requested, or intends to request, emergency use
authorization under section 564 of the FD&C Act (21 U.S.C. 360bbb-3),
unless and until the emergency use authorization request under such
section 564 has been denied or the developer of such test does not
submit a request under such section within a reasonable timeframe; (3)
is developed in and authorized by a state that has notified the
Secretary of HHS of its intention to review tests intended to diagnose
COVID-19; or (4) other tests that the Secretary of HHS determines
appropriate in guidance.\18\ We are therefore at Sec. 182.20 defining
a ``diagnostic test for COVID-19'' (also referred to as a ``COVID-19
diagnostic test'') as a COVID-19 in vitro diagnostic test described in
section 6001 of the FFCRA, as amended by section 3201 of the CARES Act.
Such COVID-19 diagnostic tests are currently billed by providers using
HCPCS and CPT codes including, but not limited to: CPT codes 86408,
86409, 87635, 87426, 86328, and 86769 and HCPCS codes U0001 through
U0004. We intend this list of billing codes to be illustrative,
however, not exhaustive. Therefore, as noted previously, a ``COVID-19
diagnostic test'' is defined as a COVID-19 in vitro diagnostic test
described in section 6001 of the FFCRA, as amended by section 3201 of
the CARES Act, even if a particular COVID-19 diagnostic test or its
billing code is not included on this list. Codes continue to be created
to address new and proprietary tests as they are developed. We
therefore anticipate updating this list in guidance as new tests and
codes are developed.
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\18\ See Q3 of FAQs About Families First Coronavirus Response
Act and Coronavirus Aid, Relief, And Economic Security Act
Implementation Part 42 available at: https://www.cms.gov/files/document/FFCRA-Part-42-FAQs.pdf.
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Obtaining a diagnostic test for COVID-19 generally can involve up
to three separate health care services for an individual including
evaluation by a practitioner of the need for such testing, and, once
the provider determines the need for a COVID-19 diagnostic test,
specimen collection and laboratory analysis of the specimen, that is,
actual performance of a COVID-19 diagnostic
[[Page 71152]]
test. For purposes of implementing section 3202(b), we are defining
``provider of a diagnostic test for COVID-19'' (herein referred to as
``provider'') as any facility that performs one or more COVID-19
diagnostic tests. CMS regulates all laboratory testing performed on
humans for the purposes of diagnosis, prevention, or treatment in the
U.S. through the Clinical Laboratory Improvement Amendments CLIA
program (42 U.S.C. 263a). In order to perform COVID-19 testing, a
facility (whether that be a primary care provider's office, urgent care
center, outpatient hospital site or stand-alone laboratory) is required
to hold a CLIA certificate based on the complexity of the testing
performed by the facility. Therefore, we expect that any ``provider of
a diagnostic test for COVID-19'' would either hold or have submitted a
CLIA application necessary to obtain a CLIA certificate (including a
certificate of waiver, as applicable) and that such testing would occur
in facilities ranging from primary care provider offices to urgent care
centers to stand-alone national laboratories.
At Sec. 182.20, we are defining ``cash price'' as the charge that
applies to an individual who pays in cash (or cash equivalent) for a
COVID-19 diagnostic test. We believe this definition will provide a
clear point of reference not only for individuals who seek such tests,
but also for payers who wish to negotiate reimbursement rates with
providers of diagnostic tests for COVID-19, or who wish to help direct
their members to providers of diagnostic tests for COVID-19 who charge
cash prices that payers believe to be reasonable. The ``cash price'' is
generally analogous to the ``discounted cash price'' as defined at 45
CFR 180.20 for purposes of the Hospital Price Transparency final rule.
As we explained in that rule, providers often offer discounts off their
gross charges or make other concessions to individuals who pay for
their own care (referred to as self-pay individuals) (84 FR 65524). We
also stated that the discounted cash price may be generally analogous
to the ``walk-in'' rate that would apply to all self-pay individuals,
regardless of insurance status, who pay in cash at the time of the
service, and that such charges are often lower than the rate the
hospital negotiates with third party payers because billing self-pay
individuals would not require many of the administrative functions that
exist for hospitals to seek payment from third party payers (for
example, prior authorization and billing
functions).19 20 21 22 It is therefore our expectation that
the ``cash price'' established by the provider will be generally
similar to, or lower than, rates negotiated with in-network plans and
insurers. If a provider has not established a ``cash price'' for a
COVID-19 diagnostic test that is lower than its gross charge or retail
rate, the provider must make public the undiscounted gross or retail
rate found in its master price list (which is analogous to the
hospital's chargemaster). We do not believe that posting a ``cash
price'' should prevent a provider of a diagnostic test for COVID-19
from offering testing for free to individuals as charity care or in an
effort to combat the public health crisis, rather, the ``cash price''
would be the maximum charge that may apply to a self-pay individual
paying out-of-pocket. We solicit comment on this approach and whether
any additional standards should be implemented to address any potential
abuse.
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\19\ Rosato D. How Paying Your Doctor in Cash Could Save You
Money. Consumer Reports. May 4, 2018. Available at: https://www.consumerreports.org/healthcare-costs/how-paying-your-doctor-in-cash-could-save-you-money/.
\20\ David Lazarus. Insured price: $2,758. Cash price: $521.
Could our Healthcare System by any Dumber? Los Angeles Times. July
30, 2019. Available at: https://www.latimes.com/business/story/2019-07-29/column-could-our-healthcare-system-be-any-dumber.
\21\ Beck M. How to Cut Your Health-Care Bill: Pay Cash. The
Wall Street Journal. February 15, 2016. Available at: https://www.wsj.com/articles/how-to-cut-your-health-care-bill-pay-cash-1455592277.
\22\ Dr. Steven Goldstein. Patients Can Save Money When They Pay
Their Doctor In Cash. Houston Healthcare Initiative. August 10,
2020. Available at: https://houstonhealthcareinitiative.org/patients-can-save-money-when-they-pay-their-doctor-in-cash/.
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Under new Sec. 182.30(a) and (b), these requirements apply to a
``provider of a diagnostic test for COVID-19'' as defined at Sec.
182.20 and are applicable during the PHE for COVID-19 determined to
exist nationwide as of January 27, 2020, by the HHS Secretary under
section 319 of the PHS on January 31, 2020, as a result of confirmed
cases of COVID-19, including any subsequent renewals.
Finally, section 3202(b)(1) of the CARES Act states that each
provider of a diagnostic test for COVID-19 shall make public the cash
price for such test on a public internet website of such provider. We
interpret this to mean that providers must make public the cash prices
for performing COVID-19 diagnostic tests on the provider's internet
website. Specifically, as discussed below, Sec. 182.40(a)(1) and (2)
require that each provider of a COVID-19 diagnostic test that has a
website make public the cash price information described in Sec.
182.40(c) electronically, and that the information itself, or a link to
a web page that contains such information, must appear in a conspicuous
location on a searchable homepage on the provider's website. We
recognize that some providers of a COVID-19 diagnostic test, for
example, small or rural providers, may not have websites. Therefore, in
the event that a provider does not have a website on which to post this
cash price information, we are finalizing a policy at Sec. 182.40(b)
to require the provider to make public its cash price information in
writing upon request within two business days and by posting signage
prominently at the location where the provider offers a COVID-19
diagnostic test in a place likely to be viewed by members of the public
seeking to obtain and pay for such testing. If the provider does not
have its own website or a publicly accessible location then, upon
request and within two business days, the provider will be required to
make public its cash price information in writing to the requestor but
will not be required to post signage at the location where it performs
the COVID-19 diagnostic test. For purposes of complying with the
requirement that the cash price information be made public in writing,
we will consider email correspondence to the requester to be an
acceptable written format. We believe these policies will help ensure
that the public (including individuals, issuers, health plans, and
others) has access to every provider's COVID-19 diagnostic test cash
prices, including those providers who do not perform COVID-19
diagnostic tests at publicly accessible locations. We seek comment on
these issues, including the frequency by which providers may not have
websites.
Furthermore, at Sec. 182.40(a)(3), we are requiring that providers
of a COVID-19 diagnostic test display their cash price information in
an easily accessible manner, without barriers, including, but not
limited to, ensuring the information is accessible: Free of charge;
without having to establish a user account or password; and without
having to submit personal identifiable information (PII). In addition,
we are requiring at Sec. 182.40(a)(4) that the provider's homepage
contain certain keywords that we believe will increase the likelihood
that the public will be able to locate the information using a search
engine. Specifically, Sec. 182.40(a)(4) requires that all of the
following terms be included on the provider's homepage: The provider's
name; ``price''; ``cost''; ``test''; ``COVID''; and ``coronavirus.'' We
seek
[[Page 71153]]
comment on whether providers should have flexibility to select between
using ``COVID'' or ``coronavirus'' and between ``cost'' and ``price''
if the provider is linking to the information from its homepage.
Finally, we believe that it is important for the provider to
include certain standardized information so that the public can
understand the relationship between the posted cash price and the
COVID-19 diagnostic test(s) offered by the provider. Therefore, at
Sec. 182.40(c)(1) through (4), we are requiring all providers to make
public, along with the cash price for each COVID-19 diagnostic test(s)
that they offer, information that, at minimum, includes a plain
language description of each COVID-19 diagnostic test, the
corresponding cash price, the billing code(s) for each such test(s),
and any additional information as may be necessary for the public to be
certain of the cash price for a particular COVID-19 diagnostic test.
For example, if the provider offers the same test at a different cash
price that is dependent on location or some other factor, then on its
website listing of cash prices, the provider must indicate all the cash
prices that apply to the test and relevant distinguishing information
as to when each different cash price applies. We believe that this
information is necessary for the public, including group health plans
and health insurance issuers offering group or individual health
insurance coverage that must provide reimbursement for COVID-19
diagnostic testing pursuant to the requirements of section 3202(a) of
the CARES Act. This requirement applies to cash price information
posted on the provider's website, made available upon request and,
where applicable, on signage.
These requirements are applicable immediately; however, we seek
comment on these requirements and may, as a result of public comment,
revise these requirements or finalize additional requirements. We also
specifically seek comment on the definition of ``diagnostic test for
COVID-19'' as solely a COVID-19 in vitro diagnostic test described in
section 6001 of FFCRA.
We seek comment on the definition of ``provider of a COVID-19
diagnostic test''. We seek comment on whether consumers may benefit
from knowing the total cost of care for receiving a COVID-19 test,
including the doctor's visit and specimen collection, in order to
protect themselves against potential unexpected health care costs and
make a more informed health care purchasing decision and therefore
whether we should adopt a more inclusive definition of a provider of a
diagnostic test for purposes of this requirement. Specifically, we seek
comment on whether a ``provider of a diagnostic test for COVID-19''
should be expanded to include providers that perform additional
services related to the performance of a COVID-19 diagnostic test, such
as for specimen collection or mileage fees that may be billed as part
of or in conjunction with the specimen collection, if applicable. We
are particularly interested in submissions from stakeholders that
include data, both anecdotal and claims-based, on the ways in which
consumers request and receive COVID-19 diagnostic testing, including
the site of care, frequency, and type of provider.
We seek comment on the definition of ``cash price''. We have heard
concerns from stakeholders that certain providers may use the posting
of a ``cash price'' as an opportunity to ``price
gouge''.23 24 25 We therefore specifically seek comment on
whether this definition or some other definition would help to mitigate
concerns for price gouging by out-of-network providers. We seek comment
on whether there are additional authorities and safeguards that could
be used to mitigate concerns for price gouging both for group health
plans and issuers and for consumers receiving a COVID-19 diagnostic
test.
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\23\ Morgan Haefner. Out-of-network Providers Price Gouging
COVID-19 tests, AHIP says. Becker's Hospital Review Newsletter.
August 28, 2020. Available at: https://www.beckershospitalreview.com/payer-issues/out-of-network-providers-price-gouging-covid-19-tests-ahip-says.html.
\24\ Susannah Luthi. The $7,000 COVID Test: Why States are
Stepping in to Shield Consumers. POLITICO. June 8, 2020. Available
at: https://www.politico.com/news/2020/06/08/coronavirus-test-costs-304058.
\25\ Ken Alltucker. `I was floored': Coronavirus test prices
charged by some hospitals and labs stun consumers, spur questions.
USA Today. September 15, 2020. Available at: https://www.usatoday.com/story/news/health/2020/09/15/covid-test-prices-hospitals-scrutiny-congress-insurers-consumers/3472304001/.
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We seek comment regarding whether these requirements are sufficient
to inform consumers of the cash price for a COVID-19 diagnostic test in
advance of receiving one and what, if any, additional requirements or
safeguards should be considered to avoid consumer confusion or prevent
unintended consequences (for example, balance billing). Specifically,
we seek comment regarding how providers should post cash prices so that
they do not inadvertently deter consumers from seeking a test that
would normally result in no out-of-pocket cost to the consumer.
Finally, we seek comment on an approach that balances priorities to
further price transparency for consumers and other stakeholders and
reduce barriers to COVID-19 testing. We recognize that these final
policies become effective as of the date of display of this IFC and are
applicable only until the end of the PHE. Even so, we seek comment
whether and to what extent these final policies and the alternatives
about which we are seeking comment (for instance, expansion of the
definition of ``provider'') may lead to:
Potential cost shifting from providers or participants,
beneficiaries, and enrollees to group health plans or issuers, if the
group health plan and issuer reimbursement obligation for COVID-19
diagnostic testing is expanded to cover such testing without cost-
sharing (including deductibles, co-pays, and co-insurance) and as
payment in full for items and services that were not previously covered
in such a manner by group health plans or issuers.
Potential for group health plans or issuers to negotiate
rates that are lower than the cash price with out-of-network providers
with whom they do not have established negotiated rates.
Price gouging or other anti-competitive behavior (under
both the policies and the alternatives for which we seek comment) by
providers as well as any potential negative impact on premiums in the
future that have not already been accounted for in 2021 rates. Please
provide empirical evidence, if any, including based on claims data
during the PHE for COVID-19.
Potential savings to issuers and plans from insured
consumers seeking out COVID-19 diagnostic testing from in-network
providers, as opposed to the provider of their choice, as a result of
these increased price transparency requirements.
Price sensitivity by consumers covered by group health
plans or issuers in their choice of provider, and awareness of any
potential cost-shifting to group health plans or issuers, or to
consumers themselves through balance billing, as a result of these
increased price transparency requirements.
Transparency benefits for the uninsured, who may already
have an incentive to find the lowest price.
Group health plans or issuers taking on new consumer
education or other potential costs, for example, costs associated with
incentivizing consumers covered by group health plans or issuers to
stay in network or seek care from lower cost providers.
[[Page 71154]]
3. Monitoring and Enforcement of Requirements To Publicize Cash Prices
for COVID-19 Diagnostic Tests
Section 3202(b)(2) of the CARES Act authorizes and provides the
Secretary discretion to impose a CMP on any provider of a diagnostic
test for COVID-19 that is not in compliance with section 3202(b)(1) of
the CARES Act and has not completed a CAP to comply with the
requirements of such paragraph, in an amount not to exceed $300 per day
that the violation is ongoing. In this IFC, we are adopting mechanisms
to monitor the requirement that a provider of a diagnostic test for
COVID-19 publicize the cash price for diagnostic testing and enforce
these requirements, as necessary.
a. Monitoring for Noncompliance and Pre-Penalty Actions
Section 3202(b)(1) of the CARES Act does not prescribe monitoring
procedures or the factors we should consider in imposing penalties on
providers for noncompliance. We anticipate relying predominantly on
complaints made to CMS by the public, including individuals, as well as
issuers and plans, regarding providers' potential noncompliance.
Specifically, in response to such complaints, we may investigate and
evaluate whether a provider has complied with the requirements
discussed above. The monitoring methods for determining a provider's
compliance with the requirements for publicizing the cash price for a
COVID-19 diagnostic test may include, but are not limited to, the
following, as appropriate:
CMS' evaluation of complaints made to CMS.
CMS' review of an individual's or entity's analysis of
noncompliance as stated in the complaint.
CMS' review of providers' websites or, where a provider
does not have a website, its written notice and signage.
The IFC includes these monitoring methods in the regulations at
Sec. 182.50(a).
Additionally, at Sec. 182.50(b), we are finalizing discretion for
CMS to take any of the following actions if CMS determines the provider
is noncompliant with the requirements of Sec. 182.40:
Provide a written warning notice to the provider of the
specific violation(s).
Request that a provider submit and comply with a CAP under
Sec. 182.60.
Impose a CMP on the provider if the provider fails to
respond to CMS' request to submit a CAP or to comply with the
requirements of a CAP approved by CMS.
A provider that CMS identifies as noncompliant and to which it
offers an opportunity to take corrective action to come into compliance
may be notified via a warning notice of its deficiencies. In response
to the warning letter, a provider may choose, but is not required, to
submit documentation for CMS to review to determine compliance. CMS
will review any documentation a provider may submit and, where
applicable, a provider's website or other form of written notice, to
determine if the provider's noncompliance has been corrected. In the
event that a provider does not have its own website on which to post
the cash price, CMS will require documentation that the provider has
the cash price in written form timely upon request and, where
applicable, has posted signage at the provider's facility.
At Sec. 182.60, we specify the requirements for CAPs.
Specifically, Sec. 182.60(a) states that a provider may be required to
submit a CAP if CMS determines a provider is noncompliant or the
provider's noncompliance continues after a warning notice. A violation
may include, but is not limited to, a provider's failure to make public
its cash price information for COVID-19 diagnostic testing required by
Sec. 182.40 and a provider's failure to make public its cash price
information in the form and manner required under Sec. 180.40.
Section 182.60(b) states that CMS may request that a provider
submit and comply with a CAP, specified in a notice of violation issued
by CMS to a provider. Additionally, in Sec. 182.60(c), we specify the
following provisions related to CAPs:
A provider required to submit a CAP must do so, in the
form and manner, and by the deadline, specified in the notice of
violation issued by CMS to the provider, and must comply with the
requirements of the CAP approved by CMS.
A provider's CAP must specify elements including, but not
limited to, the corrective actions or processes the provider will take
to address the deficiency or deficiencies identified by CMS, and the
timeframe by which the provider will complete the corrective action.
A CAP is subject to CMS review and approval. After CMS'
review and approval of a provider's CAP, CMS may monitor and evaluate
the provider's compliance with the corrective actions specified in the
CAP.
Section 182.60(d) outlines the following provisions for identifying
a provider's noncompliance with CAP requests and requirements:
A provider's failure to respond to CMS' request to submit
a CAP includes failure to submit a CAP in the form, manner, or by the
deadline, specified in a notice of violation issued by CMS to the
provider.
A provider's failure to comply with the requirements of a
CAP includes failure to correct violation(s) within the specified
timeframes.
We seek comment on this approach for monitoring providers of COVID-
19 diagnostic testing for compliance with these requirements.
Specifically, we seek comments on relying predominantly on complaints
to determine a provider's potential noncompliance. We further seek
comments on issuing warning letters and requesting CAPs for violations
related to making public cash prices for COVID-19 diagnostic testing.
Additionally, we seek comments on the length of time we should specify
in warning notices to allow corrections of violations before issuance
of a request for CAP, and the length of time we should specify for
providers to complete and return a CAP to CMS.
b. Civil Monetary Penalties
Under section 3202(b)(2) of the CARES Act, CMS may impose a CMP on
a provider that we identify as noncompliant. At Sec. 182.70, we are
finalizing requirements related to imposition of CMPs. At Sec.
182.70(a), we finalize a policy that CMS may impose a CMP on a provider
that we identify as noncompliant with any of the requirements of Sec.
182.40, and that fails to respond to CMS' request to submit a CAP or to
comply with the requirements of a CAP approved by CMS described in
Sec. 182.60(d).
Under the statute, the maximum daily dollar amount for a CMP to
which a provider may be subject is $300, even if the provider is in
violation of multiple discrete requirements of Sec. 182.40. The
maximum daily amount of the CMP will be adjusted annually using the
multiplier determined by the Office of Management and Budget (OMB) for
annually adjusting CMP amounts under 45 CFR part 102. CMS will provide
a written notice of imposition of a CMP to the provider via certified
mail or another form of traceable carrier. The elements of this notice
to the provider will include but are not limited to the following:
The basis for the provider's noncompliance, including, but
not limited to, the following: CMS' determination as to which
requirement(s) the provider has violated; and the provider's failure to
respond to CMS' request to submit a
[[Page 71155]]
CAP or comply with the requirements of a CAP.
CMS' determination as to the effective date for the
violation(s).
The amount of the penalty as of the date of the notice.
A statement that a CMP may continue to be imposed for
continuing violation(s).
Payment instructions.
A statement of the provider's right to a hearing according
to Sec. 182.90 of subpart D.
A statement that the provider's failure to request a
hearing within 30 calendar days of the issuance of the notice permits
the imposition of the penalty, and any subsequent penalties pursuant to
continuing violations, without right of appeal.
CMS may issue subsequent notice(s) of imposition of a CMP,
according to the aforementioned requirements (in short, where
investigation reveals there is continuing justification), that result
from the same instance(s) of noncompliance. A provider must pay the CMP
in full within 60 calendar days after the date of the notice of
imposition of a CMP from CMS. In the event a provider requests a
hearing, under subpart D of 45 CFR part 182, the provider must pay the
amount in full within 60 calendar days after the date of a final and
binding decision to uphold, in whole or in part, the CMP. If the 60th
calendar day is a weekend or a Federal holiday, then the timeframe is
extended until the end of the next business day. Should a provider
elect to appeal the CMP, and where the CMP is upheld only in part by a
final and binding decision, CMS will issue a modified notice of
imposition of a CMP, to conform to the adjudicated finding as specified
in Sec. 182.70.
In the event a CMP is not paid in full within 60 days, CMS will
follow the collections activities set forth in 45 CFR part 30.
Generally, CMS will issue a written demand for payment no later than 30
days after a debt is delinquent. For debts not paid by the date
specified in the written demand, interest, charged at a rate
established by the Secretary of the Treasury, shall accrue from the
date of delinquency. CMS will transfer debts 180 days or more
delinquent to the Department of Treasury for collection.
We seek comment on the approach we are establishing for imposing a
CMP on a provider noncompliant with the regulations set forth in Sec.
182.40. Specifically, we seek comments on the length of time allowed
between issuance of the request for CAP and the imposition of a CMP. In
addition, we seek comments on the amount of the CMP imposed per day up
to the statutory maximum daily amount that would be applicable to all
noncompliant providers.
c. Appeals Process
We believe it is important to establish a fair administrative
process by which providers may appeal CMS' decisions to impose
penalties under the requirements established by Sec. 182.40. Through
various programs, we have gained experience with administrative
hearings and other processes to review CMS' determinations. That
experience includes the processes we recently finalized in the CY 2020
Hospital Outpatient Prospective Payment System (OPPS) Price
Transparency Final Rule (84 FR 65524) and corresponding regulations at
45 CFR part 180, which requires price transparency for hospitals, and
we are aligning the procedures for the appeals process here with those
procedures. Therefore, a provider upon which CMS has imposed a penalty
under Sec. 182.70 may appeal that penalty in accordance with
Sec. Sec. 180.100 and 180.110, subpart D, with conforming edits.
Generally, under this approach, a provider upon which CMS has
imposed a penalty may request a hearing of that penalty before an
Administrative Law Judge (ALJ). The CMS Administrator, at his or her
discretion, may review in whole or in part the ALJ's decision. A
provider against which a final order imposing a CMP is entered may
obtain judicial review.
We specify at Sec. 182.80 the procedures for a provider to appeal
the CMP imposed by CMS for its noncompliance with the requirements of
Sec. 182.40 to an ALJ, and for the CMS Administrator, at his or her
discretion, to review in whole or in part the ALJ's decision. In so
doing, we apply the following conforming modifications to the text:
References to ``hospital'' are replaced by the term
``provider.'' We note that the term ``provider,'' as defined at new 45
CFR 182.20 in this rule, may also include hospitals.
References to ``standard charge'' are replaced by the term
``cash price.''
We seek comment on the approach we are establishing for appeals.
We also set forth in Sec. 182.90 the consequences for failure of a
provider to request a hearing. If a provider does not request a hearing
within 30 calendar days of the issuance of the notice of imposition of
a CMP described in Sec. 182.70(b), CMS may impose the CMP indicated in
such notice and may impose additional penalties under continuing
violations according to Sec. 182.70(e) without right of appeal. If the
30th calendar day is a weekend or a Federal holiday, then the timeframe
is extended until the end of the next business day. The provider has no
right to appeal a penalty with respect to which it has not requested a
hearing in accordance with 45 CFR 150.405, unless the provider can show
good cause, as determined at Sec. 150.405(b), for failing to timely
exercise its right to a hearing.
D. Medicare Inpatient Prospective Payment System (IPPS) New COVID-19
Treatments Add-On Payment (NCTAP) for the Remainder of the Public
Health Emergency (PHE)
1. Section 3710 of the CARES Act IPPS Add-On Payment for COVID-19
Patients During the PHE
Section 3710 of the CARES Act amended section 1886(d)(4)(C) of the
Act to provide for an increase in the weighting factor of the assigned
Diagnosis-Related Group (DRG) by 20 percent for an individual diagnosed
with COVID-19 discharged during the period of the PHE for COVID-19. To
implement this temporary adjustment, Medicare's claims processing
systems apply an adjustment factor to increase the Medicare Severity-
DRG (MS-DRG) relative weight that would otherwise be applied by 20
percent when determining IPPS operating payments. For additional
information regarding this add-on payment, including which claims are
eligible for the 20 percent increase in the MS-DRG weighting factor,
please see the Medicare Learning Network (MLN) Matters article ``New
COVID-19 Policies for Inpatient Prospective Payment System (IPPS)
Hospitals, Long-Term Care Hospitals (LTCHs), and Inpatient
Rehabilitation Facilities (IRFs) due to Provisions of the CARES Act''
available on the CMS website at https://www.cms.gov/files/document/se20015.pdf.
2. Overview of IPPS New Technology Add-On Payment
The new medical service or technology add-on payment policy under
the IPPS provides additional payments for cases with relatively high
costs involving eligible new medical services or technologies, while
preserving some of the incentives inherent under an average-based
prospective payment system. The payment mechanism is based on the cost
to hospitals for the new medical service or technology. Sections
1886(d)(5)(K) and (L) of the Act establish a process of identifying and
ensuring adequate payment for new medical services and technologies
(sometimes collectively referred to in this section as ``new
technologies'')
[[Page 71156]]
under the IPPS. The regulations at 42 CFR 412.87 and 412.88 implement
these provisions.
As set forth in Sec. 412.88(b)(2), for a new technology other than
certain antimicrobial products (for which the maximum add-on payment is
75 percent), if the costs of a discharge involving a new technology
exceed the full DRG payment (including payments for Indirect Medical
Education (IME) and Disproportionate Share Hospital (DSH), but
excluding outlier payments)), Medicare will make a new technology add-
on payment equal to the lesser of: (1) 65 percent of the costs of the
new technology; or (2) 65 percent of the amount by which the costs of
the case exceed the standard DRG payment.
For additional information regarding IPPS new technology add-on
payments please see the FY 2021 IPPS/LTCH PPS final rule (85 FR 58602
through 58608).
3. Overview of the Food and Drug Administration (FDA) Coronavirus
Treatment Acceleration Program
The FDA has created a special emergency program for possible
coronavirus therapies, the Coronavirus Treatment Acceleration Program.
The program uses every available method to move new treatments to
patients as quickly as possible, while at the same time finding out
whether they are helpful or harmful. The FDA continues to support
clinical trials that are testing new treatments for COVID-19 so that
valuable knowledge about their safety and effectiveness can be gained.
Additional information regarding this program is available on the FDA
website at https://www.fda.gov/drugs/coronavirus-covid-19-drugs/coronavirus-treatment-acceleration-program-ctap.
One aspect of the program is the issuance by the FDA of EUAs during
the PHE for COVID-19. On February 4, 2020, pursuant to Section
564(b)(1)(C) of the FD&C Act, the Secretary of the Department of Health
and Human Services (HHS) determined that there is a PHE that has a
significant potential to affect national security or the health and
security of United States citizens living abroad, and that involves the
virus that causes COVID-19.\26\ On the basis of such determination, the
Secretary of HHS on March 27, 2020, declared that circumstances exist
justifying the authorization of emergency use of drugs and biological
products during the COVID-19 pandemic, pursuant to section 564 of the
FD&C Act, subject to terms of any authorization issued under that
section.\27\
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\26\ U.S. Department of Health and Human Services, Determination
of a Public Health Emergency and Declaration that Circumstances
Exist Justifying Authorizations Pursuant to Section 564(b) of the
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 360bbb-3. February
4, 2020.
\27\ U.S. Department of Health and Human Services, Declaration
that Circumstances Exist Justifying Authorizations Pursuant to
Section 564(b) of the Federal Food, Drug, and Cosmetic Act, 21
U.S.C. 360bbb-3, 85 FR 18250 (April 1, 2020).
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There are currently five drug and biological products with EUAs
issued during the PHE for COVID-19. In section ``I. Criteria for
Issuance of Authorization'' of the current letters of authorization for
these drug and biological products, the letters for two of the products
state that based on the totality of scientific evidence available to
FDA, it is reasonable to believe that the product may be effective in
treating COVID-19, and that, when used under the conditions described
in the authorization, the known and potential benefits of the product
when used to treat COVID-19 outweigh the known and potential risks of
such products.\28\\[1]\ Those two drug and biological products are
COVID-19 convalescent plasma and Veklury (remdesivir).
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\28\ EUA for COVID-19 convalescent plasma: https://www.fda.gov/media/141477/download; EUA for remdesivir: https://www.fda.gov/media/137564/download.
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The current letters of authorization for the other three products
used in patients with suspected or confirmed COVID-19 do not indicate
that those products are treating COVID-19 and instead treat a disease
or condition caused or exacerbated by COVID-19.\29\ Specifically, the
letter of authorization for REGIOCIT indicates its use as a replacement
solution in adult patients in a critical care setting who are being
treated with Continuous Renal Replacement Therapy (CRRT) and for whom
regional citrate anticoagulation (RCA) is appropriate; the letter of
authorization for Fresenius Propoven 2 percent Emulsion indicates its
use to maintain sedation via continuous infusion in patients greater
than 16 years old who require mechanical ventilation in an ICU setting;
and the letter of authorization for multiFiltrate PRO System and
multiBic/multiPlus Solutions indicates its use in delivering CRRT in an
acute care environment.
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\29\ EUA for REGIOCIT: https://www.fda.gov/media/141168/download; EUA for Fresenius Propoven 2 percent Emulsion https://www.fda.gov/media/137888/download; EUA for multiFiltrate PRO System
and multiBic/multiPlus Solutions: https://www.fda.gov/media/137520/download.
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While COVID-19 convalescent plasma has received an EUA for treating
COVID-19 in hospitalized patients, Veklury (remdesivir), as of October
22, 2020, is the only drug or biological product approved by FDA for
treating COVID-19.\30\ In order for an item or service to be considered
for coverage under Medicare Part A or Part B, the item or service must
fall within at least one benefit category established in the Act. Drugs
and biologicals are included within several such benefit categories. In
general, section 1861(t)(1) of the Act defines drugs and biologicals to
include drugs or biologicals approved for inclusion in certain
compendia (except for any drugs and biologicals unfavorably evaluated
therein) or that are approved by the pharmacy and drug therapeutics
committee (or equivalent committee) of the medical staff of a hospital
furnishing that drug or biological for use in that hospital. CMS has
determined that it is appropriate for CMS to consider drug and
biological products which are authorized for emergency use for COVID-
19, with letters of authorization, and are used to treat COVID-19
disease, to fall within the drugs and biologicals definition in section
1861(t)(1) of the Act for Medicare purposes if they are included or
approved for inclusion in the applicable compendia, or when furnished
by a specific hospital if approved for use in that hospital by the
pharmacy and drug therapeutics committee (or equivalent committee) of
the medical staff of that hospital.
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\30\ FDA approval for remdesivir: https://www.accessdata.fda.gov/drugsatfda_docs/appletter/2020/214787Orig1s000ltr.pdf.
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More information regarding EUAs for drug and biological products
during the PHE for COVID-19 is available on the FDA website at https://www.fda.gov/emergency-preparedness-and-response/mcm-legal-regulatory-and-policy-framework/emergency-use-authorization#coviddrugs.
4. Overview of IPPS Outlier Payments
Section 1886(d)(5)(A) of the Act provides for payments in addition
to the basic prospective payments for ``outlier'' cases involving
extraordinarily high costs. To qualify for outlier payments, one
criterion is that a case must have costs greater than the sum of the
prospective payment rate for the MS-DRG, any IME and DSH payments,
uncompensated care payments, any new technology add-on payments, and
the ``outlier threshold'' or ``fixed-loss'' amount (a dollar amount by
which the costs of a case must exceed payments in order to qualify for
an outlier payment). We refer to the sum of the prospective payment
rate for the MS-DRG (including the Section 3710 of the CARES Act add-on
payment if applicable), any IME and DSH payments, uncompensated care
[[Page 71157]]
payments, any new technology add-on payments, and the outlier threshold
as the outlier ``fixed-loss cost threshold.'' Payments for eligible
cases are then made based on a marginal cost factor, which is a
percentage of the estimated costs above the fixed-loss cost threshold.
The marginal cost factor is 80 percent for all MS-DRGs except the burn
MS-DRGs, where the marginal cost factor is 90 percent. For the complete
formula for how an outlier payment is computed, we refer the reader to
the FY 2021 IPPS/LTCH PPS final rule (85 FR 59043 through 59044). We
note, for each claim, per the formula in the FY 2021 IPPS/LTCH PPS
final rule, in determining whether the claim is eligible for an
operating outlier payment and/or a capital outlier payment, an
``operating outlier threshold'' and a ``capital outlier threshold'' are
computed, including application of a geographic adjustment to account
for local cost variation. If the case is eligible, an ``operating
outlier payment'' and/or ``capital outlier payment'' will be made for
an individual claim. For additional information regarding IPPS outlier
payments please see the FY 2021 IPPS/LTCH PPS final rule (85 FR 59034
through 59041).
5. Eligibility Criteria for an IPPS New COVID-19 Treatments Add-on
Payment (NCTAP) for the Remainder of the PHE
We believe that as drugs or biological products become available
and are authorized or approved by FDA for the treatment of COVID-19 in
the inpatient setting, it would be appropriate to increase the current
IPPS payment amounts to mitigate any potential financial disincentives
for hospitals to provide these new treatments during the PHE.
Therefore, effective for discharges occurring on or after the effective
date of this rule and until the end of the public health emergency, CMS
is using the exceptions and adjustment authority under section
1886(d)(5)(I) of the Act to create a New COVID-19 Treatments Add-on
Payment (NCTAP) under the IPPS for COVID-19 cases that meet certain
criteria.
First, the case must include the use of a drug or biological
product authorized to treat COVID-19 as indicated in section ``I.
Criteria for Issuance of Authorization'' of the current letter of
authorization for the drug or biological product, or the drug or
biological product must be approved by the FDA for treating COVID-19.
Because the purpose of the NCTAP is to mitigate potential financial
disincentives for hospitals to provide new COVID-19 treatments, this
criterion expeditiously provides assurance in the context of the
urgency of the PHE that a treatment is new and is used to treat COVID-
19 during the PHE. Currently, there are only two drug or biological
products that meet this criterion: Veklury (remdesivir) and COVID-19
convalescent plasma. However, as additional drug and biological
products become available that meet this criterion, cases that use
those products would become eligible for the NCTAP if the remaining
criteria are met.
Second, the case must also be eligible for the 20 percent increase
in the weighting factor for the assigned MS-DRG for an individual
diagnosed with COVID-19 discharged during the period of the PHE for
COVID-19 under section 3710 of the CARES Act. The primary purposes of
this criterion are to help appropriately identify COVID-19 cases to
potentially receive the NCTAP, and ensure for program integrity reasons
that there is a positive COVID-19 laboratory test documented in the
patient's medical record. CMS may conduct post-payment medical review
to confirm the presence of a positive COVID-19 laboratory test and, if
no such test is contained in the medical record, the NCTAP will be
recouped.
Third, the operating cost of the case must exceed the operating
Federal payment under the IPPS, including the add-on payment under
section 3710 of the CARES Act. The primary purpose of this criterion is
to ensure that the NCTAP is made only when needed. The cost of the case
is determined by multiplying the covered charges by the operating cost-
to-charge ratio, the same way it is determined for new technology add-
on payments and operating outlier payments.
We note that all generally applicable statutory and regulatory
requirements during the PHE for Medicare payment for a particular case
must continue to be met, and that the NCTAP will only be available to
the extent that the new COVID-19 treatment meets all coverage
requirements under Medicare, including that the use of a drug or
biological product is medically reasonable and necessary for that case.
No applicable Medicare requirements during the PHE are being waived by
the creation of the NCTAP policy.
6. Determination of the IPPS NCTAP Amount for the Remainder of the PHE
As indicated earlier, the goal of the NCTAP is to mitigate
potential financial disincentives for hospitals to provide new COVID-19
treatments. These potential financial disincentives are already
mitigated in part by the IPPS outlier payment, but we recognize that
the costs of a case must exceed payments by the ``outlier threshold''
or ``fixed-loss'' amount before outlier payments are made. For FY 2021,
the outlier threshold is approximately $30,000. As discussed
previously, the outlier threshold is adjusted to account for local cost
variation in determining whether an individual claim is eligible for
outlier payments. As a simplified example for purposes of illustration,
if the operating costs of a case using a new COVID-19 treatment exceed
the operating IPPS payment by $10,000, there are no Medicare outlier
payments made for this case because the costs are less than the outlier
threshold.
We believe that in order to further mitigate any potential
financial disincentives for hospitals to provide new COVID-19
treatments, the NCTAP, when needed, should function to partially offset
costs that exceed the Medicare payment, but are less than the outlier
threshold. By partially rather than fully offsetting these costs, we
believe that the NCTAP, similar to the new technology add-on payment
policy under the IPPS, preserves some of the incentives inherent under
an average-based prospective payment system. One way in which the new
technology add-on payment policy accomplishes this goal is by making
the new technology add-on payment equal to the lesser of: (1) 65
percent of the costs of the new technology; or (2) 65 percent of the
amount by which the costs of the case exceed the standard DRG payment.
We believe that the new technology add-on payment calculation
provides an appropriate conceptual framework for the NCTAP calculation.
In the context of the urgency of the PHE for COVID-19, however, and the
practical and operational challenges of individually tailoring the
payment calculation to each new treatment, we believe the NCTAP
calculation should take into account 65 percent of the amount by which
the costs of the case exceed the standard DRG payment, without
comparison to 65 percent of the costs of the new treatment itself. As
part of the approval process for the new technology add-on payment for
a given new technology, the claims processing system is modified and
tailored to apply the new technology add-on payment for that technology
using cost and coding information according to the ``lesser of'' policy
described above. In order to more expeditiously provide payment for
cases meeting the previously described criteria in the context of the
urgency of the PHE, we believe the NCTAP calculation should take into
account 65 percent of the amount by which the costs of the case exceed
the standard DRG payment for all cases that qualify
[[Page 71158]]
for the NCTAP, without comparison to the costs of the new treatment as
under the ``lesser of'' policy applicable for the new technology add-on
payment.
We note that a hospital should not seek additional payment on the
claim for drugs or biologicals procured or provided by a governmental
entity to a provider at no cost to the provider to diagnose or treat
patients with known or suspected COVID-19, as described in the CMS
Medicare Claims Processing Manual, Pub. 100-04, Chapter 32, Section 67.
CMS will use ICD-10-PCS procedure codes XW033E5 (Introduction of
Remdesivir Anti-infective into Peripheral Vein, Percutaneous Approach,
New Technology Group 5) and XW043E5 (Introduction of Remdesivir Anti-
infective into Central Vein, Percutaneous Approach, New Technology
Group 5) to identify cases using remdesivir and ICD-10-PCS procedure
codes XW13325 (Transfusion of Convalescent Plasma (Nonautologous) into
Peripheral Vein, Percutaneous Approach, New Technology Group 5) and
XW14325 (Transfusion of Convalescent Plasma (Nonautologous) into
Central Vein, Percutaneous Approach, New Technology Group 5) to
identify cases using convalescent plasma. More information on the new
procedure codes implemented into the International Classification of
Diseases, Tenth Revision, Procedure Coding System (ICD-10-PCS) in
response to the PHE for COVID-19 is available on the CMS website at
https://www.cms.gov/files/document/icd-10-ms-drgs-version-372-effective-august-01-2020.pdf. CMS will issue additional operational
instructions on how eligible cases will be identified, including any
new treatments that may become available.
We also considered in the determination of the NCTAP amount that we
did not want to inadvertently reduce the IPPS operating outlier
payments that the hospital would have otherwise received for a costly
COVID-19 case given that these outlier payments already help to
mitigate potential financial disincentives for hospitals to provide new
COVID-19 treatments. Therefore, we do not believe the calculation of
the operating outlier payments should be impacted by the NCTAP.
Taking these factors into account, CMS is setting the NCTAP amount
for a case that meets the NCTAP eligibility criteria equal to the
lesser of: (1) 65 percent of the operating outlier threshold for the
claim or (2) 65 percent of the amount by which the costs of the case
exceed the standard DRG payment, including the adjustment to the
relative weight under section 3710 of the CARES Act. As with the new
technology add-on payment and outlier payments, the costs of the case
are determined by multiplying the covered charges by the operating
cost-to-charge ratio. In addition, the NCTAP will not be included as
part of the calculation of the operating outlier payments.
Returning to our simplified example, if the cost of a case using a
new COVID-19 treatment exceeds the operating IPPS payment by $10,000
and the operating outlier threshold for the case is for purposes of
illustration $30,000, the NCTAP would be $6,500 (= $10,000 excess cost
x 0.65). There would be no outlier payments because the excess cost of
the case ($10,000) does not exceed the operating outlier threshold for
the case ($30,000).
As a simplified example of a case that qualifies for an operating
outlier payment, if the cost of a case using a new COVID-19 treatment
exceeds the operating IPPS payment by $100,000, the NCTAP would be
equal to the maximum NCTAP amount of 65 percent of the operating
outlier threshold for the case. In this illustrative example, if the
applicable operating outlier threshold for the claim is $30,000, that
amount is $19,500 (equals first $30,000 of the excess cost before the
operating outlier threshold for the claim is reached x 0.65). In
addition, the case would receive an outlier payment that is calculated
the same way it is currently calculated in the absence of the $19,500
NCTAP, that is, $56,000 (= ($100,000 excess cost-$30,000 outlier
threshold for the case) * the 0.80 outlier marginal cost factor). The
combined NCTAP and outlier payment would be $75,500 (equals the $19,500
enhanced payment + the $56,000 outlier payment).
E. Medicare Outpatient Prospective Payment System (OPPS) Separate
Payment for New COVID-19 Treatments Policy for the Remainder of the
Public Health Emergency (PHE)
1. FDA Coronavirus Treatment Acceleration Program
The FDA has created a special emergency program to facilitate the
development of coronavirus therapies, the Coronavirus Treatment
Acceleration Program. One aspect of the program is the issuance by the
FDA of EUAs during the PHE for COVID-19. On February 4, 2020, pursuant
to Section 564(b)(1)(C) of the FD&C Act, the Secretary of the
Department of Health and Human Services (HHS) determined that there is
a PHE that has a significant potential to affect national security or
the health and security of United States citizens living abroad, and
that involves the virus that causes COVID-19.\31\ On the basis of such
determination, the Secretary of HHS on March 27, 2020, declared that
circumstances exist justifying the authorization of emergency use of
drugs and biologics during the COVID-19 public health emergency,
pursuant to section 564 of the FD&C Act, subject to terms of any
authorization issued under that section.\32\ Readers should refer to
Section D.3 of this interim final rule with comment period for a full
discussion of the Coronavirus Treatment Acceleration Program.
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\31\ U.S. Department of Health and Human Services, Determination
of a Public Health Emergency and Declaration that Circumstances
Exist Justifying Authorizations Pursuant to Section 564(b) of the
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 360bbb-3. February
4, 2020.
\32\ U.S. Department of Health and Human Services, Declaration
that Circumstances Exist Justifying Authorizations Pursuant to
Section 564(b) of the Federal Food, Drug, and Cosmetic Act, 21
U.S.C. 360bbb-3, 85 FR 18250 (April 1, 2020).
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There are currently five drug and biological products with EUAs
issued during the PHE for COVID-19. In section ``I. Criteria for
Issuance of Authorization'' of the current letters of authorization for
these drug and biological products, the letters for two of the products
state that based on the totality of scientific evidence available to
FDA, it is reasonable to believe that the product may be effective in
treating COVID-19, and that, when used under the conditions described
in the authorization, the known and potential benefits of the product
when used to treat COVID-19 outweigh the known and potential risks of
such products.\33\ Those drug and biological products are COVID-19
convalescent plasma and Veklury (remdesivir).
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\33\ EUA for remdesivir: https://www.fda.gov/media/137564/download; EUA for COVID-19 convalescent plasma: https://www.fda.gov/media/141477/download.
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While COVID-19 convalescent plasma has received an EUA for treating
COVID-19 in hospitalized patients, Veklury (remdesivir), as of October
22, 2020, is the only drug or biological product approved by FDA for
treating COVID-19. As discussed in Section II.D.3 of this interim final
rule with comment period, in order for an item or service to be
considered for coverage under Medicare Part A or Part B, the item or
service must fall within at least one benefit category established in
the Act. Drugs and biologicals are included within several such benefit
categories. In general, section 1861(t)(1) of the Act defines drugs and
biologicals to include drugs or biologicals approved for inclusion in
certain compendia (except
[[Page 71159]]
for any drugs and biologicals unfavorably evaluated therein) or that
are approved by the pharmacy and drug therapeutics committee (or
equivalent committee) of the medical staff of a hospital furnishing
that drug or biological for use in that hospital. CMS has determined
that it is appropriate for CMS to consider drug and biological products
which are authorized for emergency use for COVID-19, with letters of
authorization, and are used to treat COVID-19 disease, to fall within
the drugs and biologicals definition in 1861(t)(1) of the Act for
Medicare purposes if they are included or approved for inclusion in the
applicable compendia, or when furnished by a specific hospital if
approved for use in that hospital by the pharmacy and drug therapeutics
committee (or equivalent committee) of the medical staff of that
hospital.
2. OPPS Comprehensive-Ambulatory Payment Classification (C-APC) Policy
To date, no drug or biological product has an EUA for the treatment
of patients with COVID-19 in the outpatient setting. However, because
treatment of COVID-19 is rapidly evolving, we believe it is important
to ensure that separate payment is available under the OPPS for new
drug and biological products (including blood products) that receive an
EUA for treating COVID-19 in the outpatient setting or are approved by
the FDA for treating COVID-19 in the outpatient setting, or where a
drug or biological product approved under an existing EUA is authorized
for use in settings other than the inpatient setting. As part of that
process, we expect to include the addition of new codes describing
those treatments as soon as practicable, after their availability, to
ensure efficient and timely beneficiary access to those treatments. We
anticipate that most drugs and biological products authorized for use
in treating COVID-19 in the outpatient setting would be separately paid
under our standard OPPS payment policy because drugs and biological
products are typically assigned separate Ambulatory Payment
Classification payment status indicators in the OPPS unless they meet
one of the criteria for packaging, which, with the exception of drug or
biological products billed with a Comprehensive Ambulatory Payment
Classification (C-APC) service, we do not anticipate that drugs or
biological products approved or authorized to treat COVID-19 would
meet. However, these products could be packaged into a C-APC when
provided on the same claim as a C-APC service, in which case separate
payment would not be made for these products.
Under our C-APC policy, which we adopted beginning in CY 2015, we
designate a service described by a HCPCS code assigned to a C-APC as
the primary service when the service is identified by OPPS status
indicator ``J1''. When such a primary service is reported on a hospital
outpatient claim, with certain exceptions, we make payment for all
other items and services reported on the hospital outpatient claim as
being integral, ancillary, supportive, dependent, and adjunctive to the
primary service (hereinafter collectively referred to as ``adjunctive
services'') and representing components of a complete comprehensive
service (78 FR 74865 and 79 FR 66799). Payments for adjunctive services
are packaged into the payments for the primary services. This results
in a single prospective payment for each of the primary, comprehensive
services based on the costs of all reported services at the claim
level. Items included in the packaged payment provided in conjunction
with the primary service also include all drugs, biologicals, and
radiopharmaceuticals, regardless of cost, except those drugs with pass-
through payment status and self-administered drugs, unless they
function as packaged supplies (78 FR 74868 through 74869 and 74909 and
79 FR 66800). Thus, under our current policy, payment for drugs or
biological products with an emergency authorization or approved to
treat COVID-19 in the outpatient setting would be packaged into payment
for a primary C-APC service when billed on the same claim as that
service.
Currently, there are 67 C-APCs in the CY 2020 OPPS, with payments
ranging from approximately $1,000 to $37,000. Most C-APCs are for
surgical or other intensive procedures, which we would expect most
hospital outpatient departments would not perform on a patient that has
an active case of COVID-19. However, observation services can also be
paid through the ``Comprehensive Observation Services'' C-APC (C-APC
8011), which packages payment for qualifying extended assessment and
management encounters. It is possible that future COVID treatments that
are authorized or approved for use in the outpatient setting might be
administered to patients under observation while the provider
determines if the patient needs to be admitted to the hospital for
COVID-19.
3. Separate Payment Under the OPPS for New COVID-19 Treatments for the
Remainder of the PHE for COVID-19
Although we do not expect that many beneficiaries would both
receive a primary C-APC service and a drug or biological for treating
COVID-19, we nonetheless believe that as drugs or biologicals become
available and are authorized or approved for the treatment of COVID-19
in the outpatient setting, it would be appropriate to mitigate any
potential financial disincentives for hospitals to provide these new
treatments during the PHE for COVID-19. Therefore, effective for
services furnished on or after the effective date of this rule and
until the end of the PHE for COVID-19, CMS is creating an exception to
its OPPS C-APC policy to ensure separate payment for new COVID-19
treatments that meet certain criteria. Under this exception, any new
COVID-19 treatment that meets the two criteria below will, for the
remainder of the PHE for COVID-19, always be separately paid and will
not be packaged into a C-APC when it is provided on the same claim as
the primary C-APC service. Note that this separate payment will result
in an additional copayment of 20 percent of the cost of the new COVID-
19 treatment, up to the amount of the inpatient deductible.
CMS has identified two criteria for COVID-19 treatments to receive
this exception. First, the treatment must be a drug or biological
product (which could include a blood product) authorized to treat
COVID-19, as indicated in section ``I. Criteria for Issuance of
Authorization'' of the letter of authorization for the drug or
biological product, or the drug or biological product must be approved
by the FDA for treating COVID-19. Because the purpose of this exception
is to mitigate potential financial disincentives for hospitals to
provide new COVID-19 treatments, this criterion expeditiously provides
assurance in the context of the urgency of the PHE for COVID-19 that a
treatment is new and is used to treat COVID-19 disease during the PHE
for COVID-19.
Second, the EUA for the drug or biological product (which could
include a blood product) must authorize the use of the product in the
outpatient setting or not limit its use to the inpatient setting, or
the product must be approved by the FDA to treat COVID-19 disease and
not limit its use to the inpatient setting.
We note that during the PHE for COVID-19 this new exception to the
C-
[[Page 71160]]
APC packaging policy would apply to all drug and biological products
that meet both of these criteria. As of the date of issuance of this
interim final rule there are two drug or biological products that meet
the first criterion (Veklury (remdesivir) and COVID-19 convalescent
plasma), but neither of these products is authorized or approved for
use in the outpatient setting and, as a result, no product meets the
second criterion.
We also note that all generally applicable statutory and regulatory
requirements for Medicare payment under the OPPS must continue to be
met, and that OPPS payment will only be available to the extent that
the new COVID-19 treatment meets all coverage requirements under
Medicare, including that the use of a drug or biological product is
medically reasonable and necessary for the patient. No applicable
Medicare requirements during the PHE are being waived by the creation
of this C-APC exception.
4. Effects of This Exception on the OPPS Budget Neutrality Calculation
As we noted in Section II.E.2, we believe it would be a fairly rare
occurrence that an outpatient department would perform a C-APC
procedure on a beneficiary being treated for COVID-19 because most C-
APCs are for surgical or other intensive procedures and we would expect
most hospital outpatients departments would not perform outpatient
surgery on a patient that has an active case of COVID-19. While it is
possible that future COVID-19 treatments that are authorized or
approved for use in the outpatient setting might be administered to
patients under observation while the provider determines if the patient
needs to be admitted to the hospital for COVID-19, it is our
expectation that this hypothetical situation would not happen
frequently. Because we believe a new COVID-19 treatment will rarely be
provided on the same claim as a primary C-APC service, we believe new
COVID-19 treatments used in the outpatient setting will be separately
paid under current policy the vast majority of the time. As a result,
we do not believe it is necessary that we make an adjustment to OPPS
budget neutrality calculations at this time to account for this new
exception, as any budgetary effect of this new exception is likely to
be de minimis. If, once new COVID-19 treatments are being provided in
the outpatient setting, the claims data indicates that these treatments
are being provided on the same claim as a C-APC more frequently than we
expected, we can make a prospective adjustment to the OPPS budget
neutrality calculations through future rulemaking.
F. Temporary Increase in Federal Medicaid Funding
1. Background
Section 6008 of the FFCRA, as amended by section 3720 of the CARES
Act, provides a temporary 6.2 percentage point increase to each
qualifying state and territory's Federal Medical Assistance Percentage
(FMAP) under section 1905(b) of the Act (``temporary FMAP increase'').
This temporary FMAP increase is effective beginning January 1, 2020 and
could extend through the last day of the calendar quarter in which the
PHE for COVID-19, including any extensions, terminates, if the state
claims the FMAP increase in that quarter (we refer herein to the entire
period where the FMAP increase is potentially applicable as the
``increased FMAP period'').
To qualify for the temporary FMAP increase in a given quarter,
states must meet the four conditions described in subsection (b) of
section 6008 of the FFCRA during that quarter. Three of these
conditions (described at section 6008(b)(1), (2), and (4) of the FFCRA)
could extend through the end of the increased FMAP period, if the state
claims the increased FMAP through the end of the quarter in which the
PHE for COVID-19 ends. They are: (a) The state must maintain
eligibility standards, methodologies, or procedures that are no more
restrictive than what the state had in place as of January 1, 2020; (b)
the state may not charge premiums that exceed those that were in place
as of January 1, 2020; \34\ and (c) the state must cover, without the
imposition of cost sharing, testing services and treatments for COVID-
19, including vaccines, specialized equipment, and therapies.
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\34\ Section 3720 of the CARES Act added a new subsection (d) to
section 6008 of the FFCRA in order to provide states which have
increased premiums for any Medicaid beneficiaries above the amounts
in effect on January 1, 2020, with a 30-day grace period to restore
premiums to amounts no greater than those in effect as of January 1
without jeopardizing the state's eligibility for the temporary 6.2
percentage point FMAP increase.
---------------------------------------------------------------------------
The fourth condition, which is described at section 6008(b)(3) of
the FFCRA, extends through the last day of the month in which the PHE
for COVID-19 ends. This condition provides that a state may not receive
the temporary FMAP increase if ``the [s]tate fails to provide that an
individual who is enrolled for benefits under [the Medicaid state] plan
(or waiver) as of the date of enactment of this section [March 18,
2020] or enrolls for benefits under such plan (or waiver) during the
period beginning on such date of enactment [March 18, 2020] and ending
the last day of the month in which the [PHE for COVID-19] ends shall be
treated as eligible for such benefits through the end of the month in
which such emergency period ends unless the individual requests a
voluntary termination of eligibility or the individual ceases to be a
resident of the State[.]''
The language in section 6008(b)(3) of the FFCRA is somewhat
ambiguous. CMS issued guidance on this condition through frequently
asked questions (FAQs) posted on Medicaid.gov on April 13, 2020, May 5,
2020, and June 30, 2020.\35\ However, our existing interpretation
(discussed in section II.F.2 of this preamble) is not the only possible
interpretation that could be made. As the PHE for COVID-19 continued,
and states requested increased flexibility for managing their programs,
we revisited our existing interpretation. Seeking to balance the
beneficiary protections in our existing interpretation with the state
flexibility that could be afforded through an alternative
interpretation, this IFC establishes a blended approach as discussed
below.
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\35\ See:
COVID-19 Frequently Asked Questions (FAQs) for State
Medicaid and Children's Health Insurance Program (CHIP) Agencies,
available at https://www.medicaid.gov/state-resource-center/downloads/covid-19-faqs.pdf (Updated June 30, 2020)
Families First Coronavirus Response Act--Increased FMAP
FAQs available at https://www.medicaid.gov/state-resource-center/downloads/covid-19-section-6008-faqs.pdf (Updated April 13, 2020)
Families First Coronavirus Response Act (FFCRA), Public
Law 116-127 Coronavirus Aid, Relief, and Economic Security (CARES)
Act, Public Law 116-136 Frequently Asked Questions (FAQs) available
at https://www.medicaid.gov/state-resource-center/downloads/covid-19-section-6008-CARES-faqs.pdf (Posted April 13, 2020)
---------------------------------------------------------------------------
2. CMS's Existing Interpretation of Section 6008(b)(3) of the FFCRA
CMS first provided an interpretation of section 6008(b)(3) for
implementation by states through FAQs issued in April 2020. Our most
recent interpretation provided that to receive the increased FMAP under
the FFCRA, a state must keep beneficiaries enrolled in Medicaid, if
they were enrolled on or after March 18, 2020, with the same amount,
duration, and scope of benefits. It also provided that states could not
subject such beneficiaries to any increase in cost sharing or
beneficiary liability for institutional services or other long-term
services and supports (LTSS) during this time period. This
interpretation
[[Page 71161]]
protects both beneficiary eligibility and access to medically necessary
services.
Under this interpretation, if a state receives information about a
beneficiary's change in circumstances that would make the beneficiary
ineligible for Medicaid, the state may not terminate that beneficiary's
eligibility until the end of the month in which the PHE for COVID-19
ends, except in cases where the beneficiary voluntarily disenrolls or
is no longer a resident of the state. Further, if the state receives
information that would make a beneficiary eligible for a different
eligibility group with lesser benefits, greater cost sharing, or
increased beneficiary liability, the state may not transition that
beneficiary to the new eligibility group but must maintain the
beneficiary's enrollment in the current eligibility group until the end
of the month in which the PHE for COVID-19 ends.\36\
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\36\ See Question B.12 of the Families First Coronavirus
Response Act--Increased FMAP FAQs available at https://www.medicaid.gov/state-resource-center/downloads/covid-19-section-6008-faqs.pdf; Question F.27 of the Families First Coronavirus
Response Act (FFCRA), Public Law 116-127 Coronavirus Aid, Relief,
and Economic Security (CARES) Act, Public Law 116-136 Frequently
Asked Questions posted on April 13, 2020, available at https://www.medicaid.gov/state-resource-center/downloads/covid-19-section-6008-CARES-faqs.pdf; and Questions relating to Continuing Coverage
under Section 6008 of the Families First Coronavirus Response Act in
the COVID-19 Frequently Asked Questions (FAQs) for State Medicaid
and Children's Health Insurance Program (CHIP) Agencies available at
https://www.medicaid.gov/state-resource-center/downloads/covid-19-faqs.pdf
---------------------------------------------------------------------------
In protecting access to medically necessary services pursuant to
this interpretation, states must maintain current coverage in the state
plan, including alternative benefit plans (ABPs), and must also
maintain current coverage under any waivers and section 1115
demonstrations. For example, states may not implement any new
restrictions such as a reduction in the number of covered visits or a
prior authorization requirement. Beneficiary coverage may not be
reduced on an individual basis either. For example, if a beneficiary
has reached age 21 and would no longer be eligible for the Early and
Periodic Screening, Diagnostic, and Treatment (EPSDT) benefit, the
state must continue to provide EPSDT services to the beneficiary when
medically necessary, through the end of the month in which the PHE for
COVID-19 ends. Further, if a beneficiary is enrolled in a home and
community-based services (HCBS) waiver program authorized under section
1915(c) of the Act, and the individual is determined to no longer meet
the level-of-care requirements or other requirements for that waiver,
the state must maintain the beneficiary's enrollment in the HCBS
waiver. Under this interpretation, states are not required to provide
services that do not meet the state plan amount, duration, and scope
criteria for a benefit (such as medical necessity). However, as a
condition for receiving the temporary FMAP increase, the state must
ensure that a beneficiary can continue to access the benefits package
that was available to that beneficiary as of March 18, 2020 (or a later
date within the PHE) through the end of the month in which the PHE for
COVID-19 ends.
States have expressed concern that our existing interpretation of
section 6008(b)(3) of the FFCRA makes it challenging for them to manage
their programs effectively and still qualify for the increased Federal
financial participation, in frustration of one purpose of section 6008
of the FFCRA to provide additional support to state Medicaid programs
in their response to the COVID-19 pandemic. States made clear to CMS
that this interpretation, coupled with the prohibition on adopting more
restrictive eligibility standards, methodologies, or procedures under
section 6008(b)(1) of the FFCRA, would impede the routine, orderly
transition of beneficiaries between eligibility groups, and could lead
to significant backlogs in redeterminations and appeals after the PHE
for COVID-19 ends.
States also noted that our existing interpretation severely limits
state flexibility to control program costs in the face of growing
budgetary constraints and developing fiscal challenges during the
emergency period. For example, it freezes post-eligibility treatment-
of-income (PETI) calculations for institutionalized beneficiaries
regardless of changes in circumstances. States have pointed out that a
beneficiary receiving HCBS through a waiver approved under section
1915(c) of the Act who is subject to the PETI rules and who
subsequently moves into an institution would be entitled to retain the
higher personal needs allowance allowed for individuals participating
in the relevant waiver, even though the beneficiary's personal needs
would be far lower once in the institution. The aggregate effects of
this interpretation could result in a substantial increase in the state
Medicaid program's cost for the needed institutional services as
beneficiaries are not contributing as much toward the cost of their
care as they would be in the absence of the FFCRA 6008(b)(3)
requirement.
In practice, the only cost-controlling measure available to states
under our existing interpretation is reducing provider rates to the
minimum level permitted under section 1902(a)(30)(A) of the Act. Such
rate cuts, combined with a substantially lower volume of visits since
the beginning of the pandemic,\37\ could put some providers out of
business. This could undermine the solvency of critical provider
networks and their ability to serve beneficiaries in the future,
particularly in rural areas where health care workforce shortages may
already exist.
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\37\ Source: Ateev Mehrotra et al., The Impact of the COVID-19
Pandemic on Outpatient Visits: Practices Are Adapting to the New
Normal (Commonwealth Fund, June 2020). https://doi.org/10.26099/2v5t-9y63
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3. Alternative Interpretation of Section 6008(b)(3) of the FFCRA
CMS's existing interpretation of section 6008(b)(3) of the FFCRA is
not the only possible, reasonable interpretation of that provision. The
language in this section could also reasonably be interpreted to mean
only that states must maintain the enrollment of beneficiaries who
enrolled in the state's Medicaid program as of or after March 18, 2020,
through the end of the month in which the PHE ends, but not the
specific benefits package they were receiving at that time. In other
words, under this alternative interpretation, to fulfill the
requirement in section 6008(b)(3) of the FFCRA with respect to a
beneficiary who becomes ineligible for enrollment in his current
Medicaid eligibility group, states would either (a) transition the
beneficiary to another group for which he is eligible and enroll him
for the benefits provided to that eligibility group, or (b) retain the
beneficiary's enrollment in the original eligibility group, if he did
not meet the eligibility criteria for any other group, and maintain the
benefits provided to that group. Under this alternative interpretation,
a state would be required to move a beneficiary who becomes eligible
for another Medicaid eligibility group during the period in which
section 6008(b)(3) of the FFCRA applies into that new group, no matter
how limited the benefits package is for the new group. We refer to this
alternative interpretation as the ``enrollment interpretation.''
Under the enrollment interpretation, states claiming the 6.2
percentage point temporary FMAP increase would be permitted to make
programmatic changes, such as changes to the medical necessity criteria
or utilization control procedures in determining coverage for benefits;
elimination of optional benefits
[[Page 71162]]
coverage; increases in cost-sharing responsibilities (except with
respect to testing services and treatments for COVID-19 per section
6008(b)(4) of the FFCRA); or changes to the PETI methodology. For
example, states would be permitted to establish a limit on the number
of visits permitted for a given service and to require a copayment for
a service in accordance with Medicaid statute and regulations. These
programmatic changes would not jeopardize the state's receipt of the
temporary FMAP increase.
In considering this interpretation, we note that Congress expressly
conditioned receipt of the temporary FMAP increase on a state's
temporarily not implementing ``more restrictive'' ``eligibility
standards, methodologies, or procedures'' in section 6008(b)(1), on
temporarily not imposing higher premiums in section 6008(b)(2), and on
covering COVID-19 testing and treatment services without cost-sharing
in section 6008(b)(4). However, Congress did not legislate with the
same express clarity in section 6008(b)(3) with respect to states'
ability or inability to reduce the amount, duration, and scope of
benefits other than COVID-19 testing and treatment services or to
eliminate optional benefits. Further, while Congress expressly
prohibited states from imposing cost sharing on testing services and
treatments for COVID-19 in section 6008(b)(4) of the FFCRA, Congress
did not expressly provide in section 6008(b)(3) for any limitation on
cost sharing, or on states' ability to modify cost sharing or
beneficiaries' liability for the cost of other services (e.g., in
accordance with the PETI rules set forth in 42 CFR part 435, subpart H,
and 42 CFR 435.832 for beneficiaries receiving institutional services
or other long-term services and supports who are subject to the PETI
rules).
Under the enrollment interpretation, states would be required to
make individual beneficiary eligibility changes short of disenrollment
from Medicaid entirely. For example, states would be required to make
changes to a beneficiary's eligibility to reflect a change in income,
or a change related to age, pregnancy status, need for LTSS or other
eligibility factors. A change of service, such as moving from
participation in an HCBS waiver authorized under section 1915(c) of the
Act into an institution or vice versa, would also require a change in
eligibility for a beneficiary enrolled in an eligibility group specific
to HCBS recipients, such as the group described at 42 CFR 435.217, or
an eligibility group for individuals living in an institution like the
special income level group described at 42 CFR 435.236.
The enrollment interpretation would require states to move a
beneficiary who loses eligibility under one Medicaid eligibility group
and becomes eligible in a second Medicaid eligibility group into the
second eligibility group, even if the second eligibility group confers
lesser benefits or results in increased financial liability for the
beneficiary. However, as with our existing interpretation, under the
enrollment interpretation states would not be permitted to terminate a
beneficiary's eligibility unless the individual requested such
termination or was no longer a state resident. If a beneficiary loses
eligibility under one Medicaid eligibility group and is not eligible
for another group, in order to claim the temporary FMAP increase, the
state must maintain the beneficiary's enrollment in the current group
until the end of the month in which the PHE for COVID-19 ends. Like the
programmatic changes discussed previously, individual beneficiary
eligibility changes would not jeopardize receipt of the temporary FMAP
increase.
In most cases, transferring a beneficiary from one eligibility
group to another would not result in a significant change in available
benefits. With a few exceptions, Medicaid is considered to be minimum
essential coverage (MEC) as defined in section 5000A(f) of the Internal
Revenue Code of 1986 (``Code'') and implementing regulations at 26 CFR
1.5000A-2. Certain Medicaid eligibility groups, however, such as the
optional eligibility group for individuals infected with tuberculosis
(described at 42 CFR 435.215), provide only limited benefits pursuant
to the matter following section 1902(a)(10)(G) of the Act. This
optional coverage of tuberculosis and tuberculosis-related services is
excepted from the definition of MEC at 26 CFR 1.5000A-2(b)(2)(ii) and
transferring a beneficiary from an eligibility group that provides MEC
to the eligibility group for individuals infected with tuberculosis
would result in a significant reduction in available benefits.
Another example of non-MEC coverage available through Medicaid is
the optional eligibility group limited to family planning and related
services at 42 CFR 435.214, which also provides only a limited benefits
package pursuant to the matter following section 1902(a)(10)(G) of the
Act, and which is excluded from MEC at 26 CFR 1.5000A-2(b)(2)(i). If
the enrollment interpretation was adopted, following the postpartum
period for coverage of pregnant women at 42 CFR 435.116, states that
cover the optional family planning group (or that provide family
planning-only coverage through a section 1115 demonstration) would be
required to transfer women who do not qualify for a full-benefit
Medicaid eligibility group into family planning-only coverage if they
meet the eligibility requirements for the family planning-only group or
demonstration.
The enrollment interpretation of section 6008(b)(3) of the FFCRA
would make it more challenging for some beneficiaries to access
medically necessary services, including services related to the COVID-
19 pandemic. A beneficiary transferred to the family planning group
following the end of her postpartum period would continue to have
access to provider visits for family planning and outpatient drugs and
supplies related to those visits, but she would no longer have access
to testing services and treatment for COVID-19, pursuant to CMS's
interpretation of section 6008(b)(4) of the FFCRA, which is discussed
above in section II.B. In addition, she would lose access to inpatient
and outpatient hospital services, prescription drugs, and other
Medicaid-covered services that are unrelated to family planning.
Beneficiaries with certain chronic conditions like diabetes and
sickle cell disease are at higher risk for severe illness from the
virus that causes COVID-19.\38\ Under the enrollment interpretation,
individuals who lose eligibility for a group that offers MEC may be
transitioned to a limited benefit eligibility group, in a state that
offers such coverage, in which they would no longer have access to the
benefits needed to manage their chronic conditions. Not only would this
negatively impact the beneficiary who loses comprehensive Medicaid
coverage as a result of this interpretation, but it could also
undermine states' COVID-19 response efforts during the public health
emergency.
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\38\ Centers for Disease Control and Prevention, Coronavirus
Disease 2019 (COVID-19); People with Certain Medical Conditions;
accessed 10/08/2020 at https://www.cdc.gov/coronavirus/2019-ncov/need-extra-precautions/people-with-medical-conditions.html.
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4. Adopting a Blended Approach
As we considered changing our interpretation of section 6008(b)(3)
of the FFCRA, CMS examined the implications of both the existing and
alternative interpretations on each of the major Medicaid stakeholder
groups. Based on that analysis, this IFC adopts a blended approach. It
is intended to balance the interests of states, providers, and
beneficiaries, without materially undermining their ability to address
the challenges presented by COVID-19.
[[Page 71163]]
Looking first at states, the circumstances facing each state during
the PHE for COVID-19 are different. States have sent a strong message
to CMS that they need more flexibility to make choices that meet their
unique needs. They have made clear that our existing interpretation of
section 6008(b)(3) of the FFCRA has interfered with their ability to
implement cost-saving decisions in the face of increasing beneficiary
enrollment and declining state revenues. The enrollment interpretation
would allow states to impose coverage limitations that reduce spending
and allow for better management of state programs during the PHE for
COVID-19. More flexibility in managing their programs could help states
to stretch scarce financial resources over the long term, including
after the PHE for COVID-19 ends, and that could ultimately benefit both
providers and beneficiaries. Supporting states and providers fighting
the pandemic is consistent with the protections and the various
provider relief funds established by Congress in the FFCRA, the CARES
Act, and the PPPHCEA.
While the enrollment interpretation of section 6008(b)(3) of the
FFCRA may be the preferred option for states, we recognize that it
could negatively impact certain provider types. Under the enrollment
interpretation, states could eliminate optional benefits. For example,
a state could cut its optional dental benefit, and dentists in that
state would lose Medicaid reimbursement. CMS's existing interpretation,
however, leaves states with little ability to manage program costs
other than by cutting provider rates to the fullest extent permitted
under section 1902(a)(30)(A) of the Act. We believe such rate cuts
represent a far more significant threat to providers and their
continued availability to beneficiaries. Under the enrollment
interpretation, states may be less likely to reduce provider rates,
which could benefit both providers and beneficiaries.
Considering the impact on beneficiaries, our existing
interpretation provided the strongest protections for beneficiary
access to medically necessary care during the PHE. It ensured that
beneficiaries remained enrolled in Medicaid and that no new coverage
restrictions were imposed. Every Medicaid beneficiary who had access to
MEC and to testing services and treatment for COVID-19 as of or after
March 18, 2020 would continue to have access to these services under
the existing interpretation. The enrollment interpretation would also
protect beneficiary enrollment in Medicaid. At the same time, it would
expand state flexibility to make cost-saving decisions that could
reduce beneficiaries' coverage below what they had access to as of or
after March 18, 2020. Under the enrollment interpretation, some
beneficiaries would be transitioned from MEC to non-MEC coverage, which
may not include testing services and treatment for COVID-19 pursuant to
CMS's interpretation of FFCRA section 6008(b)(4). Ensuring access to
testing and treatment, along with care for the chronic health
conditions that place beneficiaries at higher risk for COVID-19, is
important for fighting the pandemic.
Seeking to balance the needs of each stakeholder group, both in
fighting the pandemic and ensuring long-term program sustainability,
this IFC adopts a blended approach to interpreting section 6008(b)(3)
of the FFCRA. This blended approach adopts the state flexibility
available through the enrollment interpretation--allowing states to
make programmatic changes to benefits and cost sharing and to
transition individual beneficiaries between eligibility groups with
differing benefit packages--while also establishing parameters to
prevent beneficiaries from losing access to comprehensive coverage,
consistent with our existing interpretation, through the end of the
month in which the PHE for COVID-19 ends.
This blended approach is expected to give states more flexibility,
beyond what is available under our existing interpretation, to manage
their Medicaid programs. This is consistent with section 1902(a)(4) of
the Act, which requires the state plan to provide for such methods of
administration as are necessary for the proper and efficient operation
of the plan. CMS is also exercising its general rulemaking authority
under sections 1102 and 1902(a)(19) of the Act to establish parameters
under which states must operate when they exercise the flexibility that
CMS is providing with respect to compliance with section 6008(b)(3) of
the FFCRA.
The parameters established by this IFC will help to ensure that
states are determining eligibility, and providing care and services, in
a manner that is consistent with the simplicity of administration, as
described in section 1902(a)(19) of the Act. Under this blended
approach, CMS is giving states a wider degree of flexibility to
effectuate enrollment transitions during the PHE for COVID-19, which
could decrease backlogs in redeterminations and appeals following the
PHE for COVID-19, thereby simplifying state implementation of the
conditions in FFCRA section 6008(b)(3) and administration of the state
plan. These parameters are also expected to help ensure that states are
determining eligibility, and providing care and services, in a manner
that is consistent with the best interests of beneficiaries, as
described in section 1902(a)(19) of the Act. That is because CMS is
giving states less flexibility to reduce beneficiaries' coverage under
this blended approach than might be available to states under the
enrollment interpretation, in an effort to help protect beneficiaries'
access to potentially necessary medical care during the period in which
the FFCRA 6008(b)(3) requirement applies. We therefore believe this
blended approach balances the interests of all stakeholders consistent
with the statute.
This IFC adds a new subpart G, Temporary FMAP Increase During the
Public Health Emergency for COVID-19, to 42 CFR part 433, including a
new Sec. 433.400. Section 433.400(a) describes the statutory basis for
this provision, while Sec. 433.400(b) provides definitions specific to
this subpart. As described in detail below, Sec. 433.400(c) requires
states, as a condition for receiving the temporary FMAP increase, to
maintain beneficiary enrollment in an eligibility group that provides
one of three tiers of coverage through the end of the month in which
the PHE for COVID-19 ends, except under the circumstances specified in
paragraph (d). This provision generally does not require states to
provide the exact same (or greater) amount, duration, and scope of
medical assistance, or maintain the cost-sharing or PETI liability for
a particular beneficiary at the same (or lower) level that was
applicable to the beneficiary as of March 18, 2020 or subsequent date
of initial enrollment during the PHE. Section 433.400 is effective
immediately upon display of this rule. CMS' previous interpretation, as
described in section II.F.2. of this preamble, continues to apply from
the beginning of the quarter up to the date that this IFC is displayed.
5. Maintaining Enrollment in the Same Tier of Coverage
As discussed, we believe that interpreting FFCRA section 6008(b)(3)
only to require continued enrollment in a state's Medicaid program
(even if benefits are strictly limited), could have significant
negative consequences for both beneficiaries and efforts to combat the
COVID-19 pandemic. Some beneficiaries may transition from medical
assistance that qualifies as MEC to non-MEC coverage, and some may even
lose access to COVID-19 testing
[[Page 71164]]
services and treatment. CMS has not interpreted section 6008(b)(4) of
the FFCRA to require state Medicaid programs to cover COVID-19 testing
services and treatment for beneficiaries whose Medicaid eligibility is
limited by statute or under existing section 1115 demonstration
authority to coverage for care and services that are for a specific
(non-COVID-19-related) condition, disease or purpose and that would not
otherwise include COVID-19 testing and treatment services.
Consistent with the blended approach to interpreting section
6008(b)(3) of the FFCRA that is described above, and consistent with
section 1902(a)(4) and (a)(19) of the Act, we are requiring states to
ensure that beneficiaries who were validly enrolled for benefits as of
or after March 18, 2020 with access to minimum essential coverage
retain access to minimum essential coverage, and to ensure that
beneficiaries with access to testing services and treatment for COVID-
19 maintain access to those services.
We believe it is reasonable to interpret the term ``enrolled for
benefits'' in section 6008(b)(3) to mean validly enrolled, such that
those who were erroneously enrolled are not to be considered ``enrolled
for benefits'' for purposes of FFCRA section 6008. Therefore, we define
``validly enrolled'' at Sec. 433.400(b) to mean that the beneficiary
was enrolled in Medicaid based on a determination of eligibility,
including during the retroactive eligibility period, and that the
beneficiary was not erroneously granted eligibility at the point of
application or last redetermination (if such last redetermination was
completed prior to March 18, 2020) because of: (1) Agency error; or (2)
fraud (as evidenced by a fraud conviction) or abuse (as determined
following the completion of an investigation pursuant to 42 CFR 455.15
and 455.16) attributed to the beneficiary or the beneficiary's
representative which was material to the determination of eligibility.
Terminating the eligibility of beneficiaries who are not validly
enrolled as defined at Sec. 433.400(b) will not impact a state's
ability to claim the temporary FMAP increase. We note that prior to
termination, however, the state must complete a redetermination
consistent with 42 CFR 435.916 and provide the beneficiary with advance
notice and the opportunity for a fair hearing consistent with 42 CFR
part 431, subpart E. Additionally, individuals receiving medical
assistance during a presumptive eligibility period in accordance with
section 1902(a)(47) of the Act and 42 CFR part 435, subpart L, have not
received a determination of eligibility by the state under the state
plan and therefore are not considered to be validly enrolled for
continuous coverage under section 6008(b)(3) of the FFCRA.
In order to receive the temporary FMAP increase (defined at Sec.
433.400(b)) for any quarter in which it is available, a state must meet
the requirements described in paragraph (c). As described in Sec.
433.400(c)(1)(i), for the quarter in which this rule becomes effective,
states would be expected to meet the requirements described in Sec.
433.400(c)(2) and (3) only from the date of display through the end of
the quarter. CMS' previous interpretation, as described in section
II.F.2. of this preamble and in the FAQs cited therein, continues to
apply from the beginning of the quarter up to the date this rule is
effective. For all quarters following the effective date of this rule,
states would be expected to meet the requirements of Sec. 433.400(c)
for the entirety of the quarter in order to claim the temporary FMAP
increase.
Section 433.400(c)(2) requires states to maintain the enrollment of
all beneficiaries who were validly enrolled on or after March 18, 2020.
Paragraphs (c)(2)(i), (ii), and (iii) of 433.400 establish safeguards
for the maintenance of enrollment. For beneficiaries who were not
validly enrolled during this period, and whom the state is therefore
permitted to disenroll, the state must provide advance notice of
termination and fair hearing rights in accordance with 42 CFR 435.917
and 42 CFR part 431, subpart E, when terminating coverage.
Consistent with the Secretary's rulemaking authority under section
1102 of the Act and section 1902(a)(19) of the Act, which provides for
such safeguards as are needed to ensure that care and services are
provided in a manner consistent with the best interests of
beneficiaries, Sec. 433.400(c)(2) establishes three tiers of Medicaid
coverage. These coverage tiers will help to ensure that beneficiaries
protected under section 6008(b)(3) of the FFCRA in states claiming the
temporary FMAP increase, who no longer meet eligibility requirements
for the initial eligibility group in which they are enrolled but who
become eligible under a different eligibility group or who lose
Medicaid eligibility entirely, do not experience a reduction in covered
benefits that would be inconsistent with section 1902(a)(19) of the
Act, or with our interpretation of sections 6008(b)(3) and (4) of the
FFCRA.
The first tier of coverage, under paragraph (c)(2)(i) of Sec.
433.400, consists of Medicaid coverage that meets the definition of
MEC, as defined in section 5000A(f) of the Code and implementing
regulations at regulation at 26 CFR 1.5000A-2. Under Sec.
433.400(c)(2)(i)(A), for beneficiaries whose Medicaid coverage as of or
after March 18, 2020 meets the definition of MEC, the state must
generally continue to provide Medicaid coverage that meets the
definition of MEC throughout the period in which this rule applies.
This means that if a state determines a beneficiary ineligible for the
group in which he or she is currently enrolled, which provides MEC, and
finds the beneficiary eligible for another group that also provides
MEC, the state would transition the beneficiary to the new eligibility
group. In contrast, if the beneficiary lost eligibility for a group
that provides MEC, but gained eligibility for coverage that does not
meet the definition of MEC, the state may not move the beneficiary to
the new group or demonstration but must instead maintain the
beneficiary's access to coverage meeting the definition of MEC during
the period in which the rule applies, except as discussed below.
For example, the state must transition a beneficiary enrolled in
the eligibility group for children under age 19 at 42 CFR 435.118 to
the adult group described at 42 CFR 435.119 when the beneficiary
reaches age 19, provided that the state covers this group and the
beneficiary meets the eligibility requirements of the group. That is
because the medical assistance provided under the eligibility group for
children under age 19 includes full state plan benefits with no cost
sharing, which meets the definition of MEC, and the medical assistance
offered under the adult group may include a somewhat different set of
benefits through the state's ABP, and may include cost sharing for
certain services, but it also meets the definition of MEC. This
transition would therefore be permissible under Sec. 433.400(c)(2)(i).
In contrast, a state may not transition a beneficiary from the
eligibility group for children under age 19 or the adult group, both of
which provide MEC, to a limited benefit group that does not provide
MEC, such as the family planning group at 42 CFR 435.214, which covers
only family planning and family planning-related services. As described
further in Sec. 433.400(c)(2)(iv), if a beneficiary receiving tier 1
coverage no longer meets the eligibility requirements for the original
group in which he or she was enrolled, and the beneficiary does not
meet the requirements for any other eligibility groups with tier 1
coverage, the state
[[Page 71165]]
must continue to provide the medical assistance offered under the
eligibility group in which the beneficiary was eligible on or after
March 18, 2020.
At Sec. 433.400(c)(2)(i)(B), we establish a variation on this
requirement for beneficiaries who have coverage meeting the definition
of MEC as of or after March 18, 2020, and whom the state subsequently
determines are eligible for coverage under a Medicare Savings Program
eligibility group. The Medicare Savings Program is defined at Sec.
433.400(b) to include the eligibility groups described at section
1902(a)(10)(E)(i), (iii), and (iv) of the Act. For such beneficiaries,
the state satisfies the requirement described in paragraph (c)(2) of
this section if it furnishes the medical assistance available through
the Medicare Savings Program, because the coverage that beneficiary
receives under the Medicare program qualifies as MEC. Thus, for
example, a beneficiary enrolled in the adult group as of or after March
18, 2020, may be transitioned to a Medicare Savings Program eligibility
group, such as the qualified Medicare beneficiaries (QMB) group
described at section 1902(a)(10)(E)(i) of the Act, when the beneficiary
reaches age 65, if the beneficiary meets the eligibility requirements
of the QMB group. Such a beneficiary would receive Medicaid coverage of
Medicare premiums and Medicare-related cost sharing through the QMB
group. However, unless that beneficiary was also eligible for another
full-benefit Medicaid eligibility group, all of the beneficiary's
health care services would be provided through Medicare and the
beneficiary would not receive any other Medicaid covered services.
While the medical assistance provided under the adult group differs
from the medical assistance provided under the QMB group, the
beneficiary maintains access to MEC. Therefore, the state may
transition the beneficiary from the adult group to a Medicare Savings
Program group.
The second tier of coverage, which is described at Sec.
433.400(c)(2)(ii), consists of coverage that is not defined as MEC but
that is robust enough to include access to coverage of both testing
services and treatment for COVID-19 under CMS's interpretation of FFCRA
section 6008(b)(4). Not all Medicaid coverage qualifies as MEC, and the
non-MEC coverage provided to beneficiaries can vary greatly. As noted
previously, some beneficiaries' coverage is limited by statute or
existing section 1115 demonstration authority to a very narrow range of
services that would not include COVID-19 testing or treatment services,
and CMS has not interpreted section 6008(b)(4) of the FFCRA to require
states to cover COVID-19 testing and treatment services for those
beneficiaries. However, other Medicaid beneficiaries receive a
relatively robust set of benefits, such as pregnancy-related services
described in the matter following section 1902(a)(10)(G) of the Act,
which would include testing services and treatment for COVID-19,
including vaccines, specialized equipment, and therapies, during the
period when FFCRA section 6008(b)(4) applies in a state, but which does
not qualify as MEC in all states.
Section 433.400(c)(2)(ii) of this IFC provides that states must
continue to provide Medicaid coverage that includes coverage of COVID-
19 testing services and treatments, including vaccines, specialized
equipment, and therapies, to beneficiaries who had access to coverage
in tier 2 as of or after March 18, 2020. Thus, states must transition
beneficiaries who lose eligibility for tier 2 coverage but gain access
to MEC coverage in tier 1 or to other coverage in tier 2 to the new
eligibility group or demonstration, but they may not transition such
beneficiaries to coverage that does not include access to testing
services and treatment for COVID-19. This interpretation is consistent
with the requirement for states claiming the temporary FMAP increase to
provide coverage for testing services and treatments for COVID-19, as
described at section 6008(b)(4), and with CMS's interpretation of that
requirement.
Consistent with Sec. 433.400(c)(2)(ii), a state must transition a
beneficiary from tier 2 coverage to tier 1 coverage if that beneficiary
becomes eligible for coverage that qualifies as MEC. For example, a
state must transition a woman receiving tier 2 postpartum coverage
under the pregnant women group described at 42 CFR 435.116 (in a state
in which such coverage is not considered MEC) to the adult group
described at 42 CFR 435.119 at the end of the postpartum period,
because coverage under the adult group qualifies as MEC and is
therefore included in tier 1. If this postpartum beneficiary was not
eligible for any eligibility groups with tier 1 coverage, such as in a
state that does not cover the adult group, but was eligible for tier 2
coverage, such as through a limited benefit section 1115 demonstration
providing non-MEC coverage that includes access to testing services and
treatment for COVID-19, the state must move her to that coverage. If
such a beneficiary is not eligible for any other tier 1 or tier 2
coverage, the state must continue to provide the medical assistance
available through the pregnant women group until the end of the month
in which the PHE for COVID-19 ends, in order to qualify for the
temporary FMAP increase, as described at Sec. 433.400(c)(2)(iv). For
example, a woman receiving non-MEC pregnancy related coverage that
includes coverage of testing services and treatments for COVID-19 could
not be transitioned to coverage of only family planning services at the
end of the postpartum period.
The third tier, described at Sec. 433.400(c)(2)(iii), includes
coverage that is not MEC and that also does not cover testing services
and treatment for COVID-19, including vaccines, specialized equipment,
and therapies, under CMS's interpretation of FFCRA section 6008(b)(4).
Coverage under tier 3 may include coverage for the eligibility group
limited to family planning described at 42 CFR 435.214 or the
eligibility group for individuals with tuberculosis described at 42 CFR
435.215. Coverage through an existing family planning demonstration or
other limited benefit section 1115 demonstration may also be included
in tier 3 if it does not cover COVID-19 testing and treatment. If a
beneficiary loses eligibility for coverage meeting the tier 3
description during the period in which the FFCRA section 6008(b)(3)
requirement applies, and the beneficiary gains eligibility for a group
that provides coverage in tier 1 or tier 2, then, under Sec.
433.400(c)(2)(iii), the state must transfer the beneficiary into that
new eligibility group as coverage in those tiers is more robust than
coverage in tier 3.
The coverage in tier 3 differs from the coverage in tier 1, which
is always considered MEC and the coverage in tier 2, which always
includes testing services and treatment for COVID-19. The coverage
available to a beneficiary in tier 3 is more limited and may vary
widely from one group or demonstration to the next. Coverage limited to
family planning and family planning-related services is significantly
different from coverage in a limited-benefit section 1115 demonstration
that focuses, for example, on preventing the progression of a specific
disease. Therefore, the requirement in Sec. 433.400(c)(2)(iii) for
tier 3 coverage differs somewhat from the requirements in Sec.
433.400(c)(2)(i) and (ii) for tiers 1 and 2. If a beneficiary becomes
ineligible for the tier 3 eligibility group or demonstration in which
he or she is enrolled and becomes eligible for another eligibility
group or demonstration with coverage that is also within tier 3, the
state must continue to provide the coverage
[[Page 71166]]
available through the eligibility group or demonstration for which the
beneficiary was eligible as of or after March 18, 2020, unless the
beneficiary requests a voluntary termination to transition to the new
eligibility group or demonstration, as discussed below. Transitioning a
beneficiary from one eligibility group offering tier 3 coverage to
another eligibility group offering tier 3 coverage would not satisfy
the requirement in Sec. 433.400(c)(2)(iii).
We note that beneficiaries enrolled in certain limited-benefit
state plan eligibility groups may be eligible for coverage in the
optional COVID-19 testing group authorized under section
1902(a)(10)(A)(ii)(XXIII), and such individuals can be enrolled in both
limited benefit groups. Section 3716 of the CARES Act amended section
1902(ss) of the Act to establish that individuals eligible for certain
optional eligibility groups, such as the eligibility group limited to
family planning and related services described at
1902(a)(10)(A)(ii)(XXI) of the Act, are considered ``uninsured'' for
purposes of eligibility under the optional COVID-19 testing group and
therefore may obtain COVID-19 testing coverage under that group in
addition to coverage under the other optional eligibility group.
In addition, beneficiaries in each benefit tier retain the right to
request a voluntary transition to a different eligibility group
(provided that they meet the applicable eligibility requirements), even
if such transition results in a change in the individual's benefit
package that would not otherwise satisfy the conditions of this rule,
such as a transition from an eligibility group with coverage in tier 1
to an eligibility group with coverage in tier 3 or a transition from
one tier 3 group to another tier 3 group. Such a transition is
permissible under the exception at Sec. 433.400(d)(1)(i), as described
at Sec. 433.400(d)(3)(i), in which a beneficiary may request a
voluntary termination of eligibility, and would not impact the state's
ability to claim the temporary FMAP increase.
Section 42 CFR 430.400(c)(2)(iv) specifies that for any beneficiary
who is validly enrolled and receiving medical assistance on or after
March 18, 2020, and who is determined ineligible for Medicaid prior to
the last day of the month in which the PHE for COVID-19 ends, except as
provided in paragraph (d), a state meets the requirements of Sec.
430.400(c)(2)(i), (ii), or (iii) by continuing the provide the same
coverage that the individual would have received absent the
determination of ineligibility. For example, if a beneficiary is
enrolled in the age and disability-related poverty level group
described at section 1902(a)(10)(A)(ii)(X) of the Act, and the
beneficiary reports a change in resources that would result in
ineligibility for this group, if the beneficiary is not eligible for
coverage in any other Medicaid eligibility group, the state would
continue to provide that individual with the coverage available to
beneficiaries enrolled in the age and disability-related poverty level
group.
The requirement at Sec. 430.400(c)(2)(iv) also applies in cases
where a state finds a beneficiary ineligible on a procedural basis,
such as a failure to respond to a request for additional information,
with an exception related to residency described at Sec.
430.400(d)(3). For example, if a state receives information from
quarterly wage data, which indicates that a child's household income
exceeds the income standard for the eligibility group for children
under age 19 (described at 42 CFR 435.118), the child is not eligible
on another basis, and the beneficiary's family does not respond to a
request from the state for additional information, the child may be
determined ineligible on a procedural basis. In this case, through the
end of the month in which the PHE for COVID-19 ends, the state would
continue to provide the child with the same coverage provided to
beneficiaries enrolled in the eligibility group for children under age
19. If the beneficiary is subsequently determined eligible for a
different eligibility group that provides the same tier of coverage, in
this case tier 1, the state would transfer the beneficiary to the new
eligibility group.
CMS is available for technical assistance to help states ensure
that all beneficiaries retain coverage in either the same tier or in a
more robust tier of coverage when their eligibility changes in a manner
that would ordinarily result in a transition between eligibility
groups.
6. Changes to Benefits, Cost Sharing, and PETI
Section 433.400 of this IFC allows states, during the period when
section 6008(b)(3) of the FFCRA applies, to move a beneficiary from one
eligibility group to another when the beneficiary becomes ineligible
for one group and eligible for another group, as long as the coverage
provided under the new group is within the same tier of coverage
(applicable to tier 1 and tier 2 coverage only) or a beneficiary may
also be moved to a more generous tier of coverage than the coverage
available to the beneficiary on or after March 18, 2020. Section
433.400(c)(3) specifies that states may make programmatic changes to
coverage, cost sharing, and beneficiary liability without violating the
requirements for receiving the temporary FMAP increase, provided that
such changes do not violate the individual beneficiary protections at
Sec. 433.400(c)(2) or the requirements under section 6008(b)(4) of the
FFCRA to cover COVID-19 testing and treatment services without cost-
sharing.
As described at Sec. 433.400(c)(3), states may generally make
changes to benefits offered under the state plan (as allowed under
relevant provisions of the Act) or a section 1115 demonstration. For
example, section 6008(b)(3) of the FFCRA does not prohibit a state from
eliminating an optional benefit from its state plan. Therefore, a state
could eliminate dental services for individuals age 21 and above, and
still comply with section 6008(b)(3) of the FFCRA. Note that under
section 1905(r)(5) of the Act, as part of the mandatory EPSDT benefit,
states must provide beneficiaries under age 21 with all necessary
health care, diagnostic services, treatment, and other measures
described in section 1905(a) of the Act, to correct or ameliorate
defects and physical and mental illnesses and conditions discovered by
EPSDT screening services, whether or not such services are covered
under the state plan. However, states need not maintain EPSDT benefits
for beneficiaries who turn 21 in order to comply with the terms of
section 6008(b)(3) of the FFCRA.
Additionally, states are permitted to change the scope of benefits
provided to beneficiaries without violating the requirements of section
6008(b)(3) for claiming the temporary FMAP increase, as long as they
comply with otherwise applicable Medicaid law, including section
6008(b)(4) of the FFCRA. For example, section 6008(b)(3) of the FFCRA
does not prohibit states from applying service authorization criteria,
including for services authorized under section 1915(c) of the Act, in
determining the amount, duration, or scope of coverage a beneficiary is
entitled to receive under the state's program. Section 440.230(b) still
applies as a limit on state flexibility. That regulation requires that
each Medicaid service must be sufficient in amount, duration, and scope
to reasonably achieve its purpose.
In considering optional changes to coverage, states may wish to
avoid service authorization changes that lead to more individuals being
placed in institutional or congregate settings, as these settings have
had a disproportionate share of COVID-19 cases and deaths. We also note
that
[[Page 71167]]
regardless of the flexibility provided at Sec. 433.400(c)(3), states
retain their obligations to provide services and supports in the ``most
integrated setting'' under the integration mandate of Title II of the
Americans with Disabilities Act (ADA), as interpreted by the Supreme
Court in Olmstead v. L.C., 527 U.S. 581 (1999) (hereafter
``Olmstead''),\39\ to avoid unjustified institutionalization or
segregation. If the elimination of an optional benefit results in or
places an individual with a disability at risk of unjustified
institutionalization or segregation, it may be a violation of the
state's obligations under the ADA and Olmstead.\40\ States' Olmstead
obligations do not confer Medicaid authority or create Medicaid
obligations where they do not otherwise exist; states may choose to
(and in some cases would be required to) use funds outside of or in
addition to Medicaid to comply with Olmstead responsibilities.
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\39\ Under title II of the ADA and Olmstead, the unjustified
isolation of individuals with disabilities constitutes unlawful
discrimination. States are required to provide community-based
treatment where such treatment would be appropriate, the affected
person does not oppose such treatment, and the treatment can be
reasonably accommodated.
\40\ See DOJ's Statement of the Department of Justice on
Enforcement of the Integration Mandate of Title II of the Americans
with Disabilities Act and Olmstead v. L.C., Question 9, updated
February 25, 2020, available at: https://www.ada.gov/olmstead/q&a_olmstead.htm.
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Finally, states may generally establish or increase cost sharing
(consistent with sections 1916 and 1916A of the Act, implementing
regulations at 42 CFR 447.50 through 447.90, and the state plan), and
increase beneficiary obligations under the PETI rules, and still comply
with FFCRA section 6008(b)(3). However, states should also comply with
FFCRA 6008(b)(4) if they are claiming the temporary FMAP increase. For
example, a state may increase the liability of individuals receiving
Medicaid coverage for institutional services under the state plan
through otherwise permissible reductions in their standard personal
needs allowances or family allowances. In addition, they may transfer a
beneficiary from one program furnishing HCBS (for example, a waiver
program authorized under section 1915(c) of the Act) to another as a
beneficiary's health status and level of care changes.
Prior to reducing benefits or increasing cost sharing or
beneficiary liability a state must provide proper advance notice and
comply with other applicable statutory and regulatory requirements. In
particular, the advance notice requirements that apply under 42 CFR
431.211 preclude states from reducing benefits or increasing cost
sharing or beneficiary liability retroactively. Additionally, 42 CFR
440.230(b) limits states' flexibility to reduce the amount, duration,
or scope of benefits; that regulation requires that each Medicaid
service must be sufficient in amount, duration, and scope to reasonably
achieve its purpose.
7. Exceptions to Maintaining Enrollment
Section 433.400(d) of this IFC describes the exceptions to the
continuous enrollment requirement in Sec. 433.400(c)(2). Section
6008(b)(3) of the FFCRA specifies that a beneficiary's Medicaid
enrollment may be terminated if the beneficiary requests a voluntary
termination of eligibility or the beneficiary is no longer a resident
of the state. These exceptions are described in Sec. 433.400(d)(1)(i)
and (ii). Because a beneficiary who dies is no longer a state resident,
Sec. 433.400(d)(1)(iii) also provides an exception for deceased
beneficiaries.
Section 433.400(d)(2) provides that states that have elected the
option under section 1903(v)(4) of the Act to provide coverage to
certain lawfully residing children and/or pregnant women, must limit
the provision of services for these beneficiaries to services necessary
for treatment of an emergency medical condition, as defined in section
1903(v)(3) of the Act, when they no longer meet the criteria at section
1903(v)(4) of the Act. This is because section 1903(v) of the Act
prohibits the provision of FFP for otherwise eligible non-citizens who
are not in a satisfactory immigration status, except as provided under
paragraphs (2) (authorizing FFP for services necessary to treat an
emergency medical condition) and (4) (relating to coverage of certain
lawfully residing children and/or pregnant women) of section 1903(v) of
the Act.
Finally, Sec. 433.400(d)(3) clarifies the exceptions at Sec.
433.400(d)(1). As noted above, Sec. 433.400(d)(1)(i) provides an
exception for beneficiaries who request a voluntary termination.
Section 433.400(d)(3)(i) provides that this exception applies not only
to beneficiaries who request that their Medicaid coverage be terminated
in its entirety, but also to beneficiaries who request a voluntary
transition to a different eligibility group (provided that they meet
the applicable eligibility requirements), even if such transition
results in a change in the individual's benefit package that would not
otherwise satisfy the conditions of Sec. 433.400(c)(2). For example, a
state may transition a beneficiary from an eligibility group with
coverage in tier 1 to an eligibility group with coverage in tier 3, at
the beneficiary's request. Such a transition would not impact the
state's ability to claim the temporary FMAP increase because the change
resulted from a beneficiary request for voluntary termination from the
original eligibility group.
Additionally, as described at Sec. 433.400(d)(3)(ii), individuals
who are identified as receiving benefits in more than one state via a
data match with the Public Assistance Reporting Information System
(PARIS) interstate matching service in accordance with Sec. 435.945(d)
and who fail to respond to a request for information to verify their
residency in the reasonable period permitted by the state, consistent
with Sec. 435.952(c)(2)(iii), are generally considered to no longer be
residents of the state for purposes of section 6008(b)(3) of the FFCRA,
provided that the state takes all available reasonable measures to
determine state residency prior to termination. These measures include,
but are not limited to, reviewing existing information in the
beneficiary's record to validate state residency, checking available
state electronic data sources such as the Department of Motor Vehicles
records or other state benefit programs, and coordinating with agencies
in the other state(s) in which the PARIS interstate match identified
the beneficiary as receiving benefits to determine the state in which
the individual is a resident for purposes of Medicaid eligibility. If
the state is unable to verify the beneficiary's continued residency in
the state because the beneficiary fails to respond to requests for
additional information and the state's alternative efforts cannot
verify the beneficiary's continued residency in the state through other
sources, that beneficiary's Medicaid enrollment may be terminated in
accordance with Sec. 435.400(d)(1)(ii). Such an individual will be
considered a non-resident for purposes of section 6008(b)(3) of the
FFCRA until such time as the state has information verifying residency.
If, after termination, the state obtains information that verifies
residency, the state must reinstate the individual's eligibility back
to the date of termination.
G. Updates to the Comprehensive Care for Joint Replacement (CJR) Model,
Performance Year (PY) 5 During the COVID-19 Public Health Emergency
(PHE)
1. Background
Under the authority of section 1115A of the Act, through notice-
and-comment
[[Page 71168]]
rulemaking, the Innovation Center established the CJR model in a final
rule titled ``Medicare Program; Comprehensive Care for Joint
Replacement Payment Model for Acute Care Hospitals Furnishing Lower
Extremity Joint Replacement Services'' published in the November 24,
2015 Federal Register (80 FR 73274) (referred to as the ``November 2015
final rule''). The CJR model, which was implemented on April 1, 2016,
aims to support better and more efficient care for beneficiaries
undergoing the most common inpatient surgeries for Medicare
beneficiaries: Hip and knee replacements (also called lower extremity
joint replacements or LEJR). This model tests bundled payment and
quality measurement for an episode of care associated with hip and knee
replacements to encourage hospitals, physicians, and post-acute care
providers to work together to improve the quality and coordination of
care from the initial hospitalization through recovery. All related
care covered by Medicare Parts A and B within 90 days of hospital
discharge from the LEJR procedure is included in the episode of care.
During the first CJR model performance period, the CJR model required
hospitals located in the 67 MSAs selected participation to participate
in the model through December 31, 2020 unless the hospital was an
episode initiator for an LEJR episode in the risk-bearing phase of
Models 2 or 4 of the Bundled Payments for Care Improvement (BPCI)
initiative. Hospitals located in one of the 67 MSAs that participated
in Model 1 of the BPCI initiative, which ended on December 31, 2016,
were required to begin participating in the CJR model when their
participation in the BPCI model ended.
In the December 1, 2017 Federal Register, we published another
final rule (82 FR 57066), titled ``Medicare Program; Cancellation of
Advancing Care Coordination Through Episode Payment and Cardiac
Rehabilitation Incentive Payment Models; Changes to Comprehensive Care
for Joint Replacement Payment Model: Extreme and Uncontrollable
Circumstances Policy for the Comprehensive Care for Joint Replacement
Payment Model'' (referred to as the ``December 2017 final rule''), that
implemented revisions to the CJR model, including giving rural and low
volume hospitals selected for participation in the CJR model as well as
those hospitals located in 33 of the 67 metropolitan statistical areas
(MSAs) \41\ a one-time option to choose whether to continue their
participation in the model through December 31, 2020 (that is, continue
their participation through PY5). An interim final rule with comment
period was also issued in conjunction with the December 2017 final rule
(82 FR 57092) in order to address the need for a policy to provide some
flexibility in the determination of episode costs for providers located
in areas impacted by extreme and uncontrollable circumstances. This
extreme and uncontrollable circumstances policy was adopted as final in
the final rule (83 FR 26604) we published in the June 8, 2018 Federal
Register, titled ``Medicare Program; Changes to the Comprehensive Care
for Joint Replacement Payment Model (CJR): Extreme and Uncontrollable
Circumstances Policy for the CJR Model.''
---------------------------------------------------------------------------
\41\ Metropolitan Statistical Area (MSA) means a core-based
statistical area associated with at least one urbanized area that
has a population of at least 50,000. MSAs included in the CJR model
are available in the December 2017 final rule available at https://www.federalregister.gov/documents/2017/12/01/2017-25979/medicare-program-cancellation-of-advancing-care-coordination-through-episode-payment-and-cardiac.
---------------------------------------------------------------------------
In the February 24, 2020 Federal Register (85 FR 10516), we
published the proposed rule titled ``Medicare Program: Comprehensive
Care for Joint Replacement Model Three-Year Extension and Changes to
Episode Definition and Pricing'' (hereinafter referred to as the
``February 2020 proposed rule''). Among other changes, this proposed
rule proposed to add three additional performance years to the CJR
model (i.e., performance years 6 through 8).
In the April 6, 2020 Federal Register (85 FR 19230), we published
an interim final rule with comment period (IFC) titled ``Medicare and
Medicaid Programs; Policy and Regulatory Revisions in Response to the
COVID-19 Public Health Emergency'' (hereinafter referred to as the
``April 2020 IFC''). In the April 2020 IFC, to account for the impact
of the PHE for COVID-19 on CJR participant hospitals, we extended PY5
through March 31, 2021, and adjusted the extreme and uncontrollable
circumstances policy to account for COVID-19 by specifying that all
episodes with a date of admission to the anchor hospitalization that is
on or within 30 days before the date that the emergency period (as
defined in section 1135(g) of the Act) begins or that occurs through
the termination of the emergency period (as described in section
1135(e) of the Act), actual episode payments are capped at the target
price determined for that episode under Sec. 510.300.
Additionally, in the May 29, 2020 Federal Register (85 FR 32460),
CMS published a proposed rule titled ``Medicare Program; Hospital
Inpatient Prospective Payment Systems for Acute Care Hospitals and the
Long-Term Care Hospital Prospective Payment System and Proposed Policy
Changes and Fiscal Year 2021 Rates; Quality Reporting and Medicare and
Medicaid Promotion Interoperability Programs Requirements for Eligible
Hospitals and Critical Access Hospitals: (hereinafter referred to as
the FY 2021 IPPS/LTCH proposed rule). In the FY 2021 IPPS/LTCH proposed
rule (85 FR 32510), we solicited comment on the effect of the proposal
to create new MS-DRG 521 and MS-DRG 522, the effect this proposal would
have on the CJR model and whether to incorporate MS-DRG 521 and MS-DRG
522, if finalized, into the CJR model's proposed extension to December
31, 2023.
Through this IFC we are implementing four changes to the CJR model.
These are: (1) Extending performance year 5 an additional 6 months to
provide for continuity of model operations with the same scope while we
continue to consider comments received on our proposal to extend the
model to performance years 6 through 8 and adopt other changes to the
model; (2) making changes to the reconciliation process for PY5 to
allow for two periods and to enable more frequent receipt of
reconciliation reports by participants; (3) making a technical change,
retroactive to October 1, 2020, to ensure that the model continues to
include the same inpatient Lower Extremity Joint Replacement (LEJR)
procedures, despite the adoption of new MS-DRGs to describe those
procedures; and (4) making changes to the extreme and uncontrollable
circumstances policy for COVID-19 to adapt to an increase in CJR
episode volume and renewal of the PHE, while providing protection
against financial consequences of COVID-19 after the extreme and
uncontrollable circumstances policy no longer applies.
2. Extension of Performance Year 5 to September 30, 2021
We are implementing a 6-month extension to CJR performance year
(PY) 5 such that the model will now end on September 30, 2021. In the
February 2020 proposed rule, we proposed to extend the CJR model by
adding three performance years (PY6 through 8), from January 1, 2021 to
December 31, 2023, to revise target prices, to change the definition of
an episode of care to
[[Page 71169]]
include outpatient procedures for Total Knee Arthroplasty and Total Hip
Arthroplasty, as well as to revise other sections of 42 CFR part
510.\42\ In response to the PHE for COVID-19, in the April 2020 IFC we
extended PY 5 an additional 3 months to end on March 31, 2021 rather
than on December 31, 2020 as finalized in November 2015 final rule.
---------------------------------------------------------------------------
\42\ For proposed changes to the CJR Model in ``Medicare
Program: Comprehensive Care for Joint Replacement Model Three Year
Extension and Changes to Episode Definition and Pricing'' See 85 FR
10516.
---------------------------------------------------------------------------
While we continue to consider the addition of performance years to
the model and other changes proposed in the February 2020 proposed
rule, we also do not want to create a disruption to the model by
allowing the model to end on March 31, 2021, which could be disruptive
to hospitals and patient care during the PHE if it is still ongoing at
that time. Implementing an additional six months of PY5, so that PY5
now ends on September 30, 2021, provides participant hospitals
additional relief and stability in model operations. In the event the
three-year extension is finalized, participant hospitals would be in a
worse position if PY 5 was not extended to September 30, 2021 because
participant hospitals would have made operational choices in reliance
on the model ending on March 31, 2021 and then have to adjust to model
changes on top of the significant burden of managing COVID-19 treatment
and under COVID-19 safety protocols and utilization changes. Overall,
this means a nine-month extension from the original conclusion of the
model as finalized in the November 2015 final rule (80 FR 73274), which
had established that the model would end on December 31, 2020 with no
new episodes initiating after October 4, 2020.
We received several comments on the April 2020 IFC supporting the
policy to extend PY5 an additional three months and asking that we
extend PY5 by 12 months instead, not just the 3 months in the April
2020 IFC. In addition, commenters noted that though state and local
guidelines have laid out a process for regions and facilities to
determine when to re-open elective procedures, the progression of
COVID-19 could impact elective procedures well into 2021. We appreciate
commenters' request to extend PY 5 by 12 additional months because of
the impact COVID-19 has had on LEJR procedures. We observe that COVID-
19 has had an impact on CJR procedures from February 2020 to August
2020. Table 1 depicts recent Medicare claims data comparing February to
August of 2019 and February to August of 2020. These numbers reflect
episode volume for each month, accounting for any CJR episode that
began within that month.
Table 1--CJR Episode Volume Comparison
--------------------------------------------------------------------------------------------------------------------------------------------------------
February March April May June July August
--------------------------------------------------------------------------------------------------------------------------------------------------------
2019 6214 6174 6515 6019 5836 6060 5838
2020 5245 3374 876 2242 4036 3838 3090
--------------------------------------------------------------------------------------------------------------------------------------------------------
In light of these data, we believe providing an additional 6 months
beyond what we adopted in the April 2020 IFC provides participant
hospitals relief from COVID-19 challenges. Therefore, we are
implementing an additional 6-month extension of CJR PY 5 and amending
the provisions at 42 CFR 510.2 and 510.200(a) to reflect this
extension.
We note that in our February 2020 proposed rule to extend and
modify the CJR model through PYs 6 to 8 (CMS-5529-P), we proposed PY 6
would comprise all CJR episodes ending on or after January 1, 2021 and
on or before December 31, 2021. However, since we are amending PY 5
such that it comprises all CJR episodes ending on or after January 1,
2020 and on or before September 30, 2021, we seek comment on the
duration of PY 6, if finalized. In particular, we seek comment on the
potential for PYs 6 through 8 to remain 12-month performance years and
each begin with episodes ending on or after October 1 each year. We
also seek comment on increasing the duration of proposed PY 6 to 15
months. Under this alternative, PY 6 would comprise all CJR episodes
ending on or after October 1, 2021 and on or before December 31, 2022;
PY 7 and PY 8 would remain 12 months and each begin with episodes
ending on or after January 1, 2023 or January 1, 2024, respectively.
3. Additional Reconciliations for Performance Year 5
Currently, following the end of each performance year, CMS
determines actual episode payments and calculates the amount of a
reconciliation payment or repayment amount, as described in 42 CFR
510.305. Each performance year is reconciled twice. The first
reconciliation calculation process begins after a 2-month period of
claims runout, while the final reconciliation calculation process
begins after a 14-month period of claims runout. The initial
reconciliation of a given performance year is conducted concurrently
with the final reconciliation of the previous performance year, and the
resulting amounts are netted against one another for one annual
reconciliation payment or repayment amount, as set forth in 42 CFR
510.305. The initial reconciliation process typically begins in late
February of the calendar year following the performance year, with
reports and reconciliation amounts issued in June. Final reconciliation
for the performance year is issued the following June.
Absent modification to the reconciliation process, the extension of
PY 5 to a total of 21 months, from January 1, 2020 through September
30, 2021 would mean that participant hospitals would experience a 21-
month gap between the PY4 final reconciliation in June of 2020 and
initial PY 5 reconciliation in early 2022. We believe this significant
gap is problematic because participant hospitals gain important
feedback from their annual reconciliation reports that they can use to
gauge their quality performance and efforts at cost-savings. These
annual reports also facilitate the relationships that participant
hospitals have established with clinicians and other entities with whom
they coordinate care and/or have gainsharing arrangements. Further, not
having an initial reconciliation for PY5 until early 2022 is not
consistent with the model design goal of reconciling one time a year
and netting against final reconciliation amounts from the prior year.
Therefore, we believe there is good cause to conduct two initial, and
two final, reconciliations of PY5. The first initial reconciliation
will apply to the first 12 months of PY5 in order to maintain
consistency with the 12 month reconciliation cycles for previous PYs 2-
4 (we note that PY 1 was 9 months rather than 12 months), and the
second initial reconciliation will apply to the
[[Page 71170]]
remaining 9 months of PY5. To minimize confusion, we will refer to
these two subsets of PY5 as performance year subset 5.1and 5.2,
respectively.
The initial reconciliation of performance year subset 5.1 will
occur fourteen months after the start of PY5, which is the same
timeline as would have occurred PY5 under the December 2017 final rule.
After the usual 2-month period of claims runout, the initial
reconciliation for performance year subset 5.1 episodes will begin in
late February of 2021 using 12 months of claims from CY 2020 to
calculate reconciliation payments, with the resulting amounts netted
against the results of the concurrent PY4 final reconciliation
calculation when we issue reports and reconciliation amounts to
participants in June 2021. Participants can expect to receive their
2021 reconciliation reports on approximately the same schedule as in
previous model years.
The nine additional months of PY 5 (performance year subset 5.2)
will be reconciled one full calendar year after the reconciliation of
PY 4 final/performance year subset 5.1 initial. We will use claims data
for the initial reconciliation of performance year subset 5.2 that
reflect a 2-month period of claims runout (as set forth in 42 CFR
510.305(e)(1)(i)), as we have for PY 1-4 and performance year subset
5.1. In short, performance year subset 5.2 will run from January 1,
2021 through September 30, 2021. Consistent with using two months of
claims run out, we will pull claims for the initial reconciliation in
December 2021. However, we will not reconcile performance year subset
5.2 until late February 2022 along with the final reconciliation for
performance year subset 5.1. This means that we will not begin
reconciliation calculation for performance year subset 5.2 until five
months after the end of performance year subset 5.2 in order to align
the initial reconciliation calculation for performance year subset 5.2
with the timing of the subsequent reconciliation calculation for
performance year subset 5.1. While alignment with the performance year
subset 5.1 subsequent reconciliation calculation is the primary reason
for this delay in the performance year subset 5.2 initial
reconciliation, it is also necessary to allow time to receive certain
input files to perform the initial reconciliation calculation,
including standardized claims files and quality data. These data are
generally not available more than a few weeks prior to the usual
reconciliation process start date in late February. Therefore, the
reconciliation process will occur on the same schedule as PY 1 through
4 and performance year subset 5.1, with the reconciliation report
available one year after the reports from the previous year's
reconciliation.
We note that, as part of the separate reconciliation calculation
processes for performance year subsets 5.1 and 5.2, we will calculate a
separate Composite Quality Score (CQS) for each of performance year
subsets 5.1 and 5.2, including a separate set of quality improvement
points and quality performance points for each performance year subset.
In order to conduct separate CQS calculations for each time period, we
are amending 42 CFR 510.400 to indicate that the required data
submissions that previously applied to PY 5 will now apply to
performance year subset 5.1, and we are adding a required data
submission for performance year subset 5.2. These additional
requirements will reflect the timeframe of performance year subset 5.2,
but will otherwise parallel the requirements for performance year
subset 5.1, and will not require an increased amount of data for
performance year subset 5.2 as compared to performance year subset 5.1.
We recognize that some of the timeframe for both performance year
subsets 5.1 and 5.2 quality data collection overlap with the effective
dates of the COVID-19 waiver \43\ that provided reporting exemptions
for hospitals participating in quality reporting programs, so we will
use quality data reported before and after the effective dates of the
COVID-19 waiver, for those quality measures to which the waiver
applied.
---------------------------------------------------------------------------
\43\ https://www.cms.gov/files/document/covid-ifc-3-8-25-20.pdf.
---------------------------------------------------------------------------
The final reconciliation calculation for performance year subset
5.2 will occur one year after the initial reconciliation of performance
year subset 5.2. Although we will use claims data that were available
14 months after the end of performance year subset 5.2 for the
subsequent reconciliation (as set forth in 42 CFR 510.305(i)(1)), as
with the initial reconciliation, we will not begin the subsequent
reconciliation calculation process until 17 months after the end of
performance year subset 5.2. We would begin the final reconciliation
calculation for performance year subset 5.2 in late February 2023 with
reconciliation payment amounts and reports issued in June, because
input files that are required for the final reconciliation will not be
available until 17 months after the end of performance year subset 5.2.
In particular, we need to receive the reconciliation results from
Accountable Care Organizations (ACOs) that overlap with CJR in order to
conduct the ACO overlap calculation. Since we cannot state with
confidence that we will have access to those data prior to the normal
reconciliation process start date in late February 2023, we will
perform the reconciliation calculation at the same time of year that we
have performed previous reconciliations. As noted above, we will
conduct the final reconciliation of performance year subset 5.2
independently. Table 2 illustrates the timelines for performance year
subsets 5.1 and 5.2.
Table 2--Timelines for Performance Years 4 and 5
----------------------------------------------------------------------------------------------------------------
Initial Subsequent
Performance year (PY) Performance period reconciliation reconciliation Reconciliation
calculation start calculation start amount (+/-)
----------------------------------------------------------------------------------------------------------------
4............................... 01/01/2019 to 12/ 2 months after 12/ 14 months after 12/ Net PY3 and PY4
31/2019. 31/2019: Late 31/2019: Late reconciliation
February 2020. February 2021. amounts.
5 (two periods)................. 01/01/2020 to 09/
30/2021.
Subset 5.1...................... 01/01/2020 to 12/ 2 months after 12/ 14 months after 12/ Net PY4 and PY5.1
31/2021. 31/2020: Late 31/2020: Late reconciliation
February 2021. February 2022. amounts.
[[Page 71171]]
Subset 5.2...................... 01/01/2021 to 09/ 5 months after 09/ 17 months after 09/ Net PY5.1 and
30/2021. 30/2021: Late 30/2021: Late PY5.2
February 2022. February 2023. reconciliation.
----------------------------------------------------------------------------------------------------------------
In order to reflect the changes in reconciliation timing and other
changes associated with additional reconciliations in PY5, we are
amending the following provisions: 42 CFR 510.2, 42 CFR 510.200, 42 CFR
510.305(b), (d)(1), (e), (i)(1) and (2), and (j)(1) and (2), and 42 CFR
510.400(b)(3)(v), and adding 42 CFR 510.400(b)(3)(vi).
4. DRG 521 and DRG 522
In this IFC we are amending our regulations at Sec. 510.300(a) to
specify that, as of October 1, 2020, the CJR model includes episodes
when the MS-DRG assigned at discharge for an anchor hospitalization is
one of two new MS-DRGs we adopted in the FY 2021 IPPS/LTCH final rule
(85 FR 58432): MS-DRG 521 (Hip Replacement with Principal Diagnosis of
Hip Fracture with Major Complications and Comorbidities (MCC)) and MS-
DRG 522 (Hip Replacement with Principal Diagnosis of Hip Fracture,
without MCC). As indicated in 42 CFR 510.300(a)(1), the CJR model
episode definition historically included MS-DRG 469 (Major Hip and Knee
Joint Replacement or Reattachment of Lower Extremity with MCC) and MS-
DRG 470 (Major Hip and Knee Joint Replacement or Reattachment of Lower
Extremity without MCC). For purposes of calculating quality adjusted
target prices, we further subdivided episodes within each MS-DRG based
on the presence or absence of a primary hip fracture. In the FY 2021
IPPS/LTCH final rule, we stated that because the CJR model would
continue until at least March 31, 2021, we intended to adopt a policy
in the CJR final rule that incorporates these new MS-DRGs into the CJR
model as of October 1, 2020 to avoid disruption to the model for the
remainder of PY5 (as extended) and thereafter, if our proposal to
extend the CJR model through PY8 were finalized (85 FR 58502). To this
end, we are adopting the change in this IFC, with retroactive effect to
October 1, 2020. This change ensures that hip replacements with a
principal diagnosis of hip fracture, with and without MCC, will
continue to trigger CJR model episodes even though they are now
assigned to these new DRGs rather than MS-DRGs 469 and 470.
As background, in the FY 2021 IPPS/LTCH proposed rule (85 FR
32510), CMS proposed the creation of two new MS-DRGs, 521 and 522 (Hip
Replacement with primary hip fracture, with and without major
complications and comorbidities, respectively). Because the FY2021
IPPS/LTCH proposed rule was published after the CJR February 2020
proposed rule, the new MS-DRGs 521 and 522 were not addressed in the
February 2020 proposed rule. We solicited comment in the FY2021 IPPS/
LTCH proposed rule on the effect this proposal would have on the CJR
model and whether to incorporate MS-DRG 521 and MS-DRG 522, if
finalized, into the CJR model's proposed extension to December 31,
2023. The public also had the opportunity to address this issue in
comments responding to the CJR February 2020 proposed rule, as the
comment period for that rule had been extended.
We received three comments in response to the February 2020
proposed rule and 20 comments in response to the FY2021 IPPS/LTCH
proposed rule addressing the effects of the proposed new MS-DRGs on the
CJR model. Most commenters agreed that MS-DRGs 521 and 522 should be
included in the definition of a CJR model episode, noting their
assumption that this would have a neutral economic impact on the model
and participants, as the CJR model already provides for separate
quality adjusted target prices for hip fracture cases for MS-DRGs 469
and 470. Multiple commenters stated their belief that there is value in
maintaining hip fracture cases in the CJR model, including that it is
administratively simpler and that maintaining hip fractures in the CJR
model would mean those procedures remain subject to the value-based
care incentives of the CJR model. Some commenters suggested that
quality adjusted target prices for episodes previously triggered by MS-
DRG 469 and MS-DRG 470 with hip fracture could apply to episodes
triggered by the new MS-DRGs. Others noted that if the DRGs were added
retroactively, they would not want the new DRGs to retroactively impact
quality adjusted target prices.
As of October 1, 2020, MS-DRGs 521 and 522 separately identify a
subset of LEJR procedures that were previously grouped to MS-DRGs 469
and 470, and if the definition of a CJR model episode is not revised to
accommodate this technical change the LEJR procedures associated with
these new codes will no longer be part of the CJR model. This result
would be highly disruptive to the CJR model, because it would remove a
significant number of episodes midway through a performance year.
Therefore, we believe there is good cause for this rulemaking to change
the definition of a CJR model episode to include MS-DRGs 521 and 522.
Indeed, it would be contrary to the public interest to undertake
traditional notice and comment rulemaking to adopt these regulatory
changes because they are intended to preserve the model's scope in
light of underlying technical changes in the IPPS. Based on the public
comments previously described, we believe that including DRGs 521 and
522 in the CJR episode definition is less disruptive to participant
hospitals than the alternative, which would be to allow hip
replacements with a primary hip fracture to drop abruptly out of the
model (or to drop out of the model until we were able to undertake full
notice and comment rulemaking to add them back at a later point). We
believe that failure to retroactively incorporate MS-DRGs 521 and 522
into the CJR model as of October 1, 2020 would be contrary to the
public interest because it would result in approximately 20-25% of all
LEJR episodes to be dropped from the CJR model. The categories of
episodes that would be dropped tend to be associated with emergent
surgeries, high-costs, and complex post-acute care needs. Dropping
these episodes from the model would create confusion, increase
administrative burden for participant hospitals, and remove the
opportunity for participant hospitals to earn reconciliation payments
by coordinating care for these complex, high-cost episodes.
Operationally, this is a seamless transition for participant
hospitals, which have continued to bill Medicare
[[Page 71172]]
FFS as usual for hip replacements with hip fractures. Beginning on
October 1, 2020, the Medicare IPPS grouper began to assign those
hospitalizations to one of the new MS-DRGs, with no billing changes
required of participant hospitals. The new MS-DRGs will be incorporated
into the CJR episode reconciliation data system, and will be included
in participant hospitals' monthly data feeds going forward. Participant
hospitals were notified of their quality adjusted target prices for
episodes beginning on October 1, 2020 for MS-DRGs 469 and 470, with and
without hip fracture. As of October 1, 2020, the quality adjusted
target prices for MS-DRGs 469 and 470 with hip fracture will apply to
episodes initiated by the new MS-DRGs 521 and 522, respectively, for
the remainder of PY5 (including both performance year subsets 5.1 and
5.2).
Given that the CJR model currently provides separate quality
adjusted target prices for episodes with and without a hip fracture,
incorporating the new DRGs would have minimal financial impact on the
model. The PY5 quality adjusted target price calculation methodology
includes the application of update factors (80 FR 73342-73346), which
incorporate annual changes to each CMS payment system (for example,
IPPS, OPPS, and SNF). The update factor is calculated and applied twice
per year, in order to incorporate both fiscal year and calendar year
payment system updates. The MS-DRG weights assigned to the new MS-DRGs
521 and 522 in the FY 2021 IPPS/LTCH final rule (84 FR 42044) will be
incorporated into the IPPS update factor as part of the calculation of
the quality adjusted target prices for episodes beginning between
October 1, 2020 and December 31, 2020. These FY 2021 MS-DRG weights
will continue in the quality adjusted target prices for episodes that
begin between January 1, 2021 and September 30, 2021, which will
incorporate CY 2021 payment system updates. As a result, baseline
prices for hip replacements with primary hip fracture, which would have
been assigned the MS-DRGs 469 and 470 and stratified by hip fracture
status, are comparable to those same episodes in the performance period
that are assigned to MS-DRGs 521 and 522, respectively. For the
remainder of PY5, we will calculate quality adjusted target prices for
episodes initiated by MS-DRGs 521 and 522 using baseline episodes
initiated by MS-DRG 469 with fracture and MS-DRG 470 with fracture,
respectively, but updated to include the MS-DRG weights assigned to MS-
DRGs 521 and 522 for FY 2021.
In this IFC we are incorporating the new MS-DRGs 521 and 522 into
the CJR model episode definition as of October 1, 2020, updating
quality adjusted target prices to reflect the applicable MS-DRG
weights, and amending the provisions at 42 CFR 510.300(a)(1)(i) and
(iii) to reflect these changes.
5. Changes to Extreme and Uncontrollable Circumstances Policy for the
PHE for COVID-19
We are also modifying the extreme and uncontrollable circumstances
adjustment for COVID-19 in Sec. 510.300(k)(4) to expire on March 31,
2021 or the last day of the emergency period, whichever is earlier. In
addition, we are adopting a more targeted adjustment, which will apply
after March 31, 2021 or the last day of emergency period (whichever is
earlier), so that financial safeguards continue to apply for CJR
episodes during which a CJR beneficiary receives a positive COVID-19
diagnosis.
Currently, the extreme and uncontrollable circumstances adjustment
for COVID-19 provides financial safeguards for participant hospitals
that have a CCN primary address that is located in an emergency area
during an emergency period, as those terms are defined in section
1135(g) of the Act, for which the Secretary issued a waiver or
modification of requirements under section 1135 of the Act on March 13,
2020, effectively applying the financial safeguards to all participant
hospitals. These financial safeguards, wherein actual episode payments
are capped at the target price determined for that episode, apply to
fracture or non-fracture episode with a date of admission to the anchor
hospitalization that is on or within 30 days before the date that the
emergency period (as defined in section 1135(g) of the Act) begins or
that occurs through the termination of the emergency period (as
described in section 1135(e) of the Act). In the April 2020 IFC we
explained this extreme and uncontrollable circumstances adjustment,
noting that the previous CJR model policy for extreme and
uncontrollable circumstances was not applicable to the PHE for the
COVID-19 pandemic. We also indicated that we did not expect many new
CJR episodes to initiate in light of the COVID-19 virus and the related
guidance to avoid elective surgeries. We further stated that we wanted
to avoid inadvertently creating incentives to place cost considerations
above patient safety within the CJR model, given the challenges to the
health care delivery system in responding to COVID-19 cases and the
expenses associated with treating the virus.
We received comments on both the April 2020 IFC and the CJR
February 2020 proposed rule about the extreme and uncontrollable
circumstances adjustment. Commenters favored the extreme and
uncontrollable circumstances policy for COVID-19 and commended CMS for
providing relief to participant hospitals. Some commenters questioned
what steps CMS would take once the PHE ends and noted the uncertainty
in the current policy since there is not a concrete end date for the
PHE. A commenter recommended CMS hold participant hospitals harmless
from performance-related penalties for the 2020 performance year and
urged CMS to make appropriate adjustments for the 2020 and 2021
performance years and to address the impact of COVID-19 on financial
expenditures, performance scores and risk adjustment.
We appreciate commenters' positive feedback on the April 2020 IFC
and our decision to provide relief to participant hospitals. At the
onset on the PHE, we quickly developed financial safeguards in the
April 2020 IFC due to the mandatory nature of the model and the
location of all 471-participant hospitals in MSAs where COVID-19 was
most prevalent. For example, there are 98 participant hospitals in the
New York/New Jersey Metropolitan Area, which was the epicenter for
COVID-19.\44\ Further, at that time, we did not possess data that
allowed CMS to determine the COVID-19 virus's effect on the CJR model,
and believed it was most prudent to waive downside risk for all
episodes thorough the duration of the PHE.
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\44\ ``New York City Region Is Now an Epicenter of the
Coronavirus Pandemic'' March 22, 2020. Available at https://www.nytimes.com/2020/03/22/nyregion/Coronavirus-new-York-epicenter.html.
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Since publishing the April 2020 IFC, we reviewed Medicare claims
data and observe a steep decline in the initiation of episodes in April
2020 (See Table 1). Post April 2020, CJR episodes are increasing, and
though not at normal utilization as compared to 2019 Medicare claims
data, the data reflects a continual initiation of CJR episodes despite
the ongoing PHE. In addition, related Federal guidance to avoid
elective surgeries has expired, which allows certain participant
hospitals to initiate elective LEJR procedures.\45\ The continual
initiation of CJR episodes during the PHE is contrary to our assumption
in the April 2020 IFC, that
[[Page 71173]]
is, we did not expect many new CJR episodes to initiate during the PHE.
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\45\ https://www.cms.gov/files/document/covid-flexibility-reopen-essential-non-covid-services.pdf.
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Absent a change to specify an end date, the current extreme and
uncontrollable adjustment in 42 CFR 510.300(k)(4) would continue as
long as the PHE. Unfortunately, the combination of CJR episode volume
increasing to levels we did not anticipate during the PHE and the
continued renewal of the PHE threatens the ability of the CJR model to
generate any savings over the course of the model. With greater
surgical volume, we do not believe such a broad extreme and
uncontrollable circumstances policy for COVID-19 remains necessary.
For these reasons, we are implementing an end date to the extreme
and uncontrollable circumstances adjustment for COVID-19. Specifically,
for a fracture or non-fracture episode with a date of admission to the
anchor hospitalization that is on or within 30 days before the date
that the emergency period (as defined in section 1135(g) of the Act)
begins or that occurs on or before March 31, 2021 or the last day of
such emergency period, whichever is earlier, actual episode payments
are capped at the quality adjusted target price determined for that
episode under Sec. 510.300. We are amending the provisions at 42 CFR
510.305(k)(4) to reflect this change.
In addition, in order to account for CJR beneficiaries with a
positive COVID-19 diagnosis during a CJR episode that initiates after
the adjustments for extreme and uncontrollable circumstances specified
in Sec. 510.305(k)(4) end, we are amending our regulations at Sec.
510.305(e)(1)(i) to cap actual episode payments at the quality adjusted
target price for the episode, effectively waiving downside risk for all
episodes with actual episode payments that include a claim with a
COVID-19 diagnosis code. This policy will apply after March 31, 2021 or
the last day of the PHE, whichever occurs earlier.
In response to commenters' questions about how the CJR model will
alleviate financial risk associated with COVID-19 once the PHE expires,
we explored the flexibilities provided by other CMMI models and found
them to be consistent with a targeted, episode-based approach to
providing financial relief from COVID-19. In order to be responsible
stewards of the Medicare Trust Fund, we are adopting a policy to
provide participant hospitals continuing financial protection from the
effect of COVID-19 on the CJR model that may continue beyond the end of
the PHE for COVID-19 or March 31, 2021 (whichever is earlier).
Specifically, at the initial and subsequent reconciliations of
performance year subset 5.2, which will include episodes subject to
this new adjustment policy, we will identify episodes with actual
episode payments with any claim containing a COVID-19 diagnosis and
costs for those episodes will be capped at the quality adjusted target
price, effectively waiving downside risk for that episode. A COVID-19
diagnosis is identified by the following ICD-10-CM diagnosis codes:
B97.29; U07.1; or any other ICD-10-CM diagnosis code that is
recommended by the Centers for Disease Control and Prevention for the
coding of a confirmed case of COVID-19.\46\ We understand that ICD-10
diagnosis codes B97.29 (which was used for dates of service on or after
January 27, 2020 through March 31, 2020) and U07.1 (which was used for
dates of service on or after April 1, 2020 through September 30, 2020)
might not be used for dates of service to which our new adjustment
policy will apply. Nevertheless, given the potential for uncertainty as
to whether either of these codes will be used for dates of service
after September 30, 2020, we are including them in the definition of
``COVID-19 diagnosis code'' that we are adding to Sec. 510.2 for
completeness.
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\46\ https://www.cdc.gov/nchs/data/icd/ICD-10-CM-Official-Coding-Gudance-Interim-Advice-coronavirus-feb-20-2020.pdf?fbclid=IwAR2c9LrGMAhum_Ogu-LrxPJ-S4u_j4wGW1615I_fmoiDB5AA0wKHKitjoXo.
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In order to provide participant hospitals continuing financial
protection from the effect of COVID-19 on the CJR model that may
continue beyond the end of the PHE for COVID-19 or March 31, 2021,
whichever occurs earlier, we are implementing that actual episode
payments are capped at the quality adjusted target price determined for
that episode under Sec. 510.300 for episodes with actual episode
payments that include a claim with a COVID-19 diagnosis code and
initiate after the earlier of March 31, 2021 or the last day of the
emergency period.
III. Provisions of the Interim Final Rule--Departments of the Treasury,
Labor and Health and Human Services
A. Rapid Coverage of Preventive Services for Coronavirus
1. Background
In addition to the steps Congress took to ensure coverage of COVID-
19 diagnostic testing, in section 3203 of the CARES Act, Congress
required group health plans and health insurance issuers offering group
or individual health insurance coverage to cover, without cost sharing,
qualifying coronavirus preventive services. This coverage is required
to be provided ``pursuant to section 2713(a) of the [PHS] Act,''
including its implementing regulations or any successor regulations.
Section 2713 of the PHS Act was added by section 1001 of PPACA and
incorporated by reference into ERISA by section 715 of ERISA and into
the Code by section 9815 of the Code. Section 2713 of the PHS Act and
the regulations implementing section 2713 of the PHS Act require non-
grandfathered group health plans and health insurance issuers offering
non-grandfathered group or individual health insurance coverage to
provide coverage of certain specified preventive items and services
without cost sharing. These services include:
Evidence-based items or services that have in effect a
rating of ``A'' or ``B'' in the current recommendations of the USPSTF
with respect to the individual involved.
Immunizations for routine use in children, adolescents,
and adults that have in effect a recommendation from ACIP with respect
to the individual involved. A recommendation of ACIP is considered to
be ``in effect'' after it has been adopted by the Director of the CDC.
A recommendation is considered to be for ``routine use'' if it appears
on the Immunization Schedules of the CDC.
With respect to infants, children, and adolescents,
evidence-informed preventive care and screenings provided for in the
comprehensive guidelines supported by the Health Resources and Services
Administration (HRSA).
With respect to women, preventive care and screenings
provided for in comprehensive guidelines supported by HRSA (not
otherwise addressed by the recommendations of the USPSTF), subject to
certain exemptions and accommodations (see 45 CFR 147.131 through
147.133).
The Departments' current regulations (herein referred to as the
2015 Final Regulations) under section 2713 of the PHS Act at 26 CFR
54.9815-2713; 29 CFR 2590.715-2713; and 45 CFR 147.130 require that
plans and issuers provide coverage of recommended preventive services
for plan years that begin on or after September 23, 2010, or, if later,
for plan years that begin on or after the date that is one year after
the date the recommendation or guideline is issued.
Under the 2015 Final Regulations, if a recommended preventive
service is billed separately (or is tracked as individual encounter
data separately) from an office visit, then a plan or issuer
[[Page 71174]]
may impose cost-sharing requirements with respect to the office visit.
However, if a preventive service is not billed separately (or is not
tracked as individual encounter data separately) from an office visit
and the primary purpose of the office visit is the delivery of such an
item or service, then a plan or issuer may not impose cost-sharing
requirements with respect to the office visit.
The 2015 Final Regulations generally do not require a plan and
issuer that has a network of providers to provide benefits for
applicable preventive items or services that are delivered by an out-
of-network provider. Moreover, the 2015 Final Regulations generally do
not preclude a plan or issuer that has a network of providers from
imposing cost-sharing requirements for preventive services that are
delivered by an out-of-network provider. However, if a plan or issuer
does not have in its network a provider who can provide a preventive
service, then the plan or issuer must cover the recommended preventive
service when performed by an out-of-network provider and may not impose
cost sharing with respect to the recommended preventive service.
Many items and services required to be covered under section 2713
of the PHS Act typically are provided as part of the usual course of
preventive care, often according to regularly scheduled intervals.
Examples include immunizations provided according to schedules
established by the CDC and other annual screenings or counseling.
Therefore, the 2015 Final Regulations require coverage without cost
sharing for applicable immunizations that are recommended by ACIP for
routine use, and state that a recommendation is considered to be for
``routine use'' if it appears on the Immunization Schedules of the CDC.
Section 3203 of the CARES Act establishes a more accelerated
timeline for required coverage of qualifying coronavirus preventive
services than other recommended preventive services under PHS Act
section 2713. As stated above, coverage of qualifying coronavirus
preventive services must be provided no later than 15 business days
following an applicable recommendation. In addition, it is possible
that items, services, and immunizations used to prevent or mitigate
COVID-19 will not, in the immediate future, be recommended as part of a
usual course of preventive care, but rather for more urgent use. As
reflected by the expedited timeline for coverage Congress established
in section 3203 of the CARES Act, the need to provide coverage of
qualifying coronavirus preventive services is urgent. Therefore, as
discussed below, this IFC requires coverage of COVID-19 immunizations
within 15 business days after the immunization has been recommended by
ACIP and adopted by the CDC, regardless of whether it appears on the
Immunization Schedules of the CDC for routine use.
Additionally, in light of the current PHE for COVID-19, it is
imperative that group health plans and health insurance issuers provide
full coverage for these items and services, including costs for the
administration of vaccines, and ensure timely access to coverage as
Congress intended. Accordingly, in this IFC, the Departments provide
certain clarifications previously made with respect to the 2015 Final
Regulations and amend those regulations to implement unique
requirements related to covering qualifying coronavirus preventive
services.\47\
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\47\ The 2015 Final Regulations address the obligation to
continue to provide coverage for recommended preventive services
that are in effect on the first day of a plan or policy year when
there are changes in recommendations or guidelines. See 26 CFR
54.9815-2713(b)(2)(i) and (ii); 29 CFR 2590.715-2713(b)(2)(i) and
(ii); 45 CFR 147.130(b)(2)(i) and (ii). Given the expedited timeline
for coverage under section 3203 of the CARES Act, this IFC amends
the 2015 Final Regulations to make clear that these paragraphs apply
to recommended preventive services that are covered on the first day
of the plan or policy year or, with respect to qualifying
coronavirus preventive services, ``as otherwise specified in
paragraph (b)(3) of this section.''
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2. Scope of Requirement To Cover Certain Recommended Preventive
Services Under Section 2713 of the Public Health Service Act
a. Related Items and Services
In implementing section 2713 of the PHS Act, the 2015 Final
Regulations addressed whether office visit charges associated with
certain recommended preventive services must be covered without cost
sharing. Specifically, Example 1 in the 2015 Final Regulations
illustrates how the requirements apply in situations where a provider
bills a plan for an office visit where a preventive screening for
cholesterol abnormalities (which has in effect a rating of A or B from
the USPSTF) is conducted and for the laboratory work of the cholesterol
screening test. In that example, the plan may not impose any cost-
sharing requirements with respect to the separately billed laboratory
work of the cholesterol screening test. Because the office visit is
billed separately from the cholesterol screening test, the 2015 Final
Regulations provide that the plan may impose cost-sharing requirements
for the office visit.
Prior to the publication of the 2015 Final Regulations, the
Departments received questions from stakeholders regarding discrete
coverage issues related to certain recommended preventive services. In
particular, with respect to colonoscopies, stakeholders asked whether
certain related services (such as the cost of polyp removal or
anesthesia) must also be covered without cost sharing. The Departments
clarified in subregulatory guidance that a plan or issuer may not
impose cost sharing for polyp removal during a preventive screening
colonoscopy, as such service is an integral part of a colonoscopy, and
also stated that anesthesia provided in connection with a preventive
colonoscopy must be covered without cost sharing.\48\
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\48\ See FAQs About Affordable Care Act Implementation Part 12,
Q5 (Feb. 20, 2013), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xii.pdf and https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/aca_implementation_faqs12 and FAQs About Affordable Care Act
Implementation Part XXVI, Q7 (May 11, 2015), available at https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/faqs/aca-part-xxvi.pdf and https://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/aca_implementation_faqs26.pdf.
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Consistent with the examples provided in the 2015 Final Regulations
and subregulatory guidance cited in the preamble to the rulemaking
promulgating the 2015 Final Regulations, the Departments further
clarify that under the 2015 Final Regulations and this IFC, plans and
issuers subject to section 2713 of the PHS Act must cover, without cost
sharing, items and services that are integral to the furnishing of the
recommended preventive service, regardless of whether the item or
service is billed separately. For example, several of the recommended
preventive services involve screenings for the presence of certain
health conditions, such as diabetes, or a variety of sexually
transmitted infections. These recommended screenings, typically
performed by laboratories, cannot be conducted without first collecting
a specimen. Accordingly, plans and issuers subject to section 2713 of
the PHS Act must cover without cost sharing both the specimen
collection and the recommended preventive service, regardless of how
the specimen collection is billed. Similarly, a recommended
immunization generally cannot be furnished without being administered
by a medical professional. As qualifying coronavirus preventive
services are expected to include immunizations, plans and issuers
subject to section 2713 of the PHS Act
[[Page 71175]]
must cover without cost sharing such an immunization and its
administration, regardless of how the administration is billed, and
regardless of whether a COVID-19 vaccine or any other immunization
requires the administration of multiple doses in order to be considered
a complete vaccination. This includes coverage without cost sharing of
the administration of a required preventive immunization in instances
where a third party, such as the Federal Government, pays for the
preventive immunization. Further, if a COVID-19 immunization is not
billed separately (or is not tracked as individual encounter data
separately) from an office visit and the primary purpose of the visit
is the delivery of the recommended COVID-19 immunization, then
consistent with the 2015 Final Regulations, the plan or issuer may not
impose cost-sharing requirements with respect to the office visit. The
Departments seek comment on this clarification.
b. Out-of-Network Coverage During the PHE for COVID-19
The 2015 Final Regulations permit a group health plan or issuer
that has a network of providers to omit coverage or to impose cost-
sharing requirements for recommended preventive services when such
services are provided by an out-of-network provider, unless the plan or
issuer does not have in its network a provider who can provide the
service.\49\ This approach reflects that, as noted earlier in this
section of the preamble, recommended preventive services generally are
obtained as part of a regular course of preventive care, so
participants, beneficiaries, and enrollees typically have the
opportunity to seek such care from an in-network provider. By contrast,
in the immediate term, newly developed qualifying coronavirus
preventive services might be available from a narrower range of
providers than other, more established recommended preventive services.
To help ensure full access to and the widespread use of qualifying
coronavirus preventive services to mitigate the effect of the PHE for
COVID-19 and slow transmission of the virus, it is critical that
individuals be able to receive such services from any provider
authorized to provide the service. Therefore, this IFC amends the 2015
Final Regulations to require that plans and issuers subject to section
2713 of the PHS Act must cover without cost sharing a qualifying
coronavirus preventive service, regardless of whether such service is
delivered by an in-network or out-of-network provider. This is based on
the Departments' view that participants, beneficiaries, and enrollees
may not be able to locate in-network providers consistently during the
emergency period.
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\49\ 26 CFR 54.9815-2713(a)(3); 29 CFR 2590.715-2713(a)(3); 45
CFR 147.130(a)(3).
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To satisfy this requirement, the Departments are of the view that
plans and issuers must administer this out-of-network coverage
requirement in such a way that makes receiving out-of-network services
for qualifying coronavirus preventive services a meaningful benefit for
participants, beneficiaries, and enrollees. To be a meaningful benefit,
the Departments are of the view that plans and issuers must administer
this out-of-network coverage requirement in a way that ensures that
participants, beneficiaries, and enrollees have access to a variety of
out-of-network providers for such services. To the extent plans and
issuers reimburse out-of-network providers an unreasonably low amount
for qualifying coronavirus preventive services, including for
administration of a COVID-19 vaccine, this approach could severely
limit the number of such providers that are willing to provide the
service, which would contravene the purpose of the requirement to
provide out-of-network coverage without cost sharing of qualifying
coronavirus preventive services. Therefore, this IFC provides that with
respect to a qualifying coronavirus preventive service and a provider
with whom the plan or issuer does not have a negotiated rate for such
service (such as an out-of-network provider), the plan or issuer must
reimburse the provider for such service in an amount that is
reasonable, as determined in comparison to prevailing market rates for
such service. The Departments will consider the amount of payment to be
reasonable, for example, if the plan or issuer pays the provider the
amount that would be paid under Medicare for the item or service. In
the Departments' view, these minimum payment standards are necessary
and appropriate because providers that participate in the CDC COVID-19
Vaccination Program contractually agree to administer a COVID-19
vaccine regardless of an individual's ability to pay and regardless of
their coverage status, and also may not seek any reimbursement,
including through balance billing, from a vaccine recipient.
The Departments request comment on all aspects of this approach.
The Departments request comment on the issue of network adequacy and
whether and, if so, how long provider networks are expected to be
inadequate. The Departments also request comment on the safeguards in
this IFC to ensure that out-of-network reimbursement rates are
reasonable and that providers administering a publicly funded COVID-19
vaccine are reimbursed by group health plans and issuers prevailing
market rates in the absence of a negotiated rate, and whether other
examples of reasonable reimbursement rates, in addition to Medicare
rates, would be useful.
3. Definition of Qualifying Coronavirus Preventive Services
Section 3203(b)(1) of the CARES Act defines ``qualifying
coronavirus preventive service'' as an item, service, or immunization
that is intended to prevent or mitigate COVID-19 and that is--(A) an
evidence-based item or service that has in effect a rating of `A' or
`B' in the current recommendations of the USPSTF; or (B) an
immunization that has in effect a recommendation from ACIP with respect
to the individual involved. The statutory provisions describing USPSTF
and ACIP recommendations in this definition are substantively identical
to the ones at section 2713(a)(1) and (2) of the PHS Act. However, as
stated above, under the 2015 Final Regulations, only ``immunizations
for routine use in children, adolescents, and adults'' that are
recommended by ACIP must be covered without cost sharing.\50\ A
recommendation is considered to be for routine use if it is listed on
the CDC's Immunization Schedules.\51\
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\50\ See 75 FR 41726, 41728 (July 19, 2010), codified at 26 CFR
54.9815-2713(a)(1)(ii); 29 CFR 2590.715-2713(a)(1)(ii); 45 CFR
147.130(a)(1)(ii).
\51\ Id.
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This IFC provides a definition of qualifying coronavirus preventive
services that is consistent with the statutory definition in section
3203 of the CARES Act. However, the Departments note that unlike the
other preventive service immunizations required to be covered without
cost sharing under section 2713 of the PHS Act and the 2015 Final
Regulations, this definition and related coverage requirement are not
limited to COVID-19 immunizations recommended by ACIP for ``routine
use.'' While other preventive items and services may be recommended for
routine use, for reasons described elsewhere in this section of the
preamble, the PHE for COVID-19 presents unique circumstances and
qualifying coronavirus preventive services might not, in the immediate
term, be recommended for routine use, according to specified schedules.
Rather, the
[[Page 71176]]
Departments generally expect consumers should receive an immunization
for COVID-19 as soon as it becomes available to the general public, or
as soon as it becomes available to them based on their status as part
of a high-risk or high-priority population, as recommended by ACIP.
Plans and issuers subject to section 2713 of the PHS Act must cover,
without cost sharing, COVID-19 immunizations that are recommended by
ACIP and adopted by the Director of CDC, even if not listed for routine
use on the CDC Immunization Schedules, pursuant to 26 CFR 54.9815-
2713T(a); 29 CFR 2590.715-2713(a); and 45 CFR 147.130(a), and subject
to the additional changes described later in this section of the
preamble.\52\
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\52\ HHS reminds states that the HHS Office for Civil Rights
enforces applicable Federal civil rights laws as described above, as
well as laws protecting the exercise of conscience and religious
freedom, including the Religious Freedom Restoration Act (42 U.S.C.
2000bb through 2000bb-4). HHS's requirements are subject to these
laws, and states may have obligations under these laws to protect
conscience, prohibit coercion, and to ensure the free exercise of
religion. U.S. Department of Health & Human Services, Office for
Civil Rights, Conscience and Religious Freedom, https://www.hhs.gov/conscience/ (last visited Aug. 20, 2020).
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4. Qualifying Coronavirus Preventive Services--Timing Requirement
Section 2713 of the PHS Act and the 2015 Final Regulations require
plans and issuers to cover recommended preventive items and services
beginning with the first plan year (or in the individual market, policy
year) that is one year after the date the recommendation or guideline
is issued. Section 3203 of the CARES Act accelerates the timeline for
coverage of qualifying coronavirus preventive services without cost
sharing, requiring coverage to be provided within 15 business days
after the date on which a recommendation is made relating to such
service. This IFC codifies these timing requirements at 26 CFR 54.9815-
2713T(b)(3); 29 CFR 2590.715-2713(b)(3); and 45 CFR 147.130(b)(3).
In addition, the IFC adds a sunset provision at 26 CFR 54.9815-
2713T(e); 29 CFR 2590.715-2713(e); and 45 CFR 147.130(e), under which
the amendments made to the regulations will not apply with respect to
qualifying coronavirus preventive services furnished on or after the
expiration of the PHE for COVID-19. The Departments note, however, that
coverage under section 3203 of the CARES Act is not limited to the
duration of the PHE for COVID-19 and therefore the statutory provisions
will continue to apply.
B. Diagnostic Testing for COVID-19
Section 6001 of the FFCRA generally requires group health plans and
health insurance issuers offering group or individual health insurance
coverage to provide benefits for COVID-19 diagnostic tests and certain
items and services related to diagnostic testing for COVID-19 when
those items or services are furnished on or after March 18, 2020, and
during the duration of the PHE for COVID-19. Under the FFCRA, plans and
issuers must provide this coverage without imposing any cost-sharing
requirements (including deductibles, copayments, and coinsurance) or
prior authorization or other medical management requirements. Section
3201 of the CARES Act, enacted on March 27, 2020, amended section 6001
of the FFCRA to include a broader range of diagnostic tests that plans
and issuers must cover without any cost-sharing requirements or prior
authorization or other medical management requirements.
Section 3202(a) of the CARES Act provides that a plan or issuer
providing coverage of items or services described in section 6001(a) of
the FFCRA shall reimburse the provider of the diagnostic testing at a
rate negotiated with the provider, or if there is no negotiated rate,
at an amount that equals the cash price for such service as listed by
the provider on a public internet website. As previously articulated in
guidance, the Departments interpret the requirement to provide coverage
without cost sharing in section 6001 of the FFCRA, together with
section 3202(a) of the CARES Act, as establishing a process for setting
reimbursement rates and protecting participants, beneficiaries, and
enrollees from being balance billed for an applicable COVID-19
test.\53\ These provisions help ensure consumers can be tested for
COVID-19 without barriers related to cost, and are critical to the
ability to detect the virus and stop its spread. However, testing
efforts have continued to be hampered by challenges, such as delays in
obtaining results, issues with test accuracy, and supply shortages.\54\
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\53\ FAQs About Families First Coronavirus Response Act and
Coronavirus Aid, Relief, and Economic Security Act Implementation
Part 43 (June 23, 2020), available at https://www.cms.gov/files/document/FFCRA-Part-43-FAQs.pdf and https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-activities/resource-center/faqs/aca-part-43.pdf.
\54\ American Society for Microbiology, ``Supply Shortages
Impacting COVID-19 and Non-COVID Testing'' (Oct. 15, 2020),
available at https://asm.org/Articles/2020/September/Clinical-Microbiology-Supply-Shortage-Collecti-1.
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The Departments encourage group health plans and issuers of group
or individual health insurance coverage to consider market-driven
approaches to addressing these continued challenges surrounding COVID-
19 diagnostic testing. The Departments encourage plans and issuers to
explore using payment arrangements that create incentives for providers
to reduce the time it takes to provide results for diagnostic testing
for COVID-19, while maintaining the accuracy rates of their test
results in instances where it is within the ability of providers to
address a delay.
At certain points in this PHE, there have been wide variations in
the time it takes providers to make test results available to
consumers. These delays in obtaining test results increase the risk
that infected individuals may unknowingly infect others. These delays
could be caused by large volumes of tests to process and/or inadequate
resources. Pay-for-performance arrangements, where reimbursement rates
are based on the time it takes to make test results available, could
encourage innovative approaches by providers to reduce the turnaround
time. The Departments encourage group health plans and issuers of group
or individual health insurance coverage to consider developing such
arrangements with providers, and strongly encourage plans and issuers
that do so to incorporate safeguards to ensure that the payment
arrangements are not structured in a way that prioritizes speed over
accuracy or that result in unintended consequences, such as reduction
in access to COVID-19 diagnostic testing or non-compliance with balance
billing restrictions.
IV. Provisions of the Interim Final Rule Regarding State Innovation
Waivers--Department of the Treasury and Health and Human Services
A. State Innovation Waivers Policy and Regulatory Revisions in Response
to the PHE for COVID-19 Public Health Emergency
1. Background
Section 1332 of the PPACA permits states to apply for a State
Innovation Waiver (also referred to as ``section 1332 waivers'' or
``State Relief and Empowerment Waivers'') to pursue innovative
strategies for providing their residents with access to higher value,
more affordable health coverage. The overarching goal of section 1332
waivers is to give all Americans the opportunity to obtain high value
and affordable health coverage regardless of income, geography, age,
sex, or health status,
[[Page 71177]]
while simultaneously empowering states to develop health coverage
strategies that best meet the needs of their residents. Section 1332
waivers provide states an opportunity to promote a stable health
insurance market that offers more choice and affordability to their
residents. Under section 1332 of the PPACA, a State Innovation Waiver
can be approved by HHS and the Department of the Treasury if it
provides access to quality health coverage that is at least as
comprehensive and affordable as would be provided absent the waiver,
provides coverage to a comparable number of residents of the state as
would be provided coverage absent a waiver, and does not increase the
Federal deficit. To date, HHS and the Department of the Treasury have
approved 15 state waiver requests, 14 of which implement state-based
reinsurance programs.\55\ As noted in a recent data brief issued by
CMS, section 1332 state-based reinsurance waivers have resulted in a
statewide average premium reduction ranging from four to 37 percent in
calendar year 2020 for residents in states with approved waivers.\56\
Reinsurance provides a direct benefit to consumers by paying a portion
of provider claims that would otherwise be paid by consumers through
higher premiums and lowering premiums for people in the individual
health insurance market. HHS and the Department of the Treasury
continue to encourage states to take advantage of the flexibilities
available through section 1332 waivers in order to pursue solutions to
help lower costs and increase coverage choices for Americans faced with
unaffordable premiums and reduced competition in the insurance market
both during and after the PHE for COVID-19.
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\55\ More information on section 1332 waivers that are approved
is available online: https://www.cms.gov/CCIIO/Programs-and-Initiatives/State-Innovation-Waivers/Section_1332_State_Innovation_Waivers-.
\56\ CCIIO Data Brief Series: State Relief and Empowerment
Waives: State-based Reinsurance Programs. June 2020. Available
online: https://www.cms.gov/CCIIO/Programs-and-Initiatives/State-Innovation-Waivers/Downloads/1332-Data-Brief-June2020.pdf.
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Section 1332(a)(4)(B) of the PPACA requires the Secretary of HHS
and the Secretary of the Treasury (the Secretaries) to issue
regulations regarding procedures for State Innovation Waivers. On March
14, 2011, HHS and the Department of the Treasury published the
``Application, Review, and Reporting Process for Waivers for State
Innovation'' proposed rule (76 FR 13553) to implement section
1332(a)(4)(B) of the PPACA.\57\ On February 27, 2012, HHS and the
Department of the Treasury published the ``Application, Review, and
Reporting Process for Waivers for State Innovation'' final rule (77 FR
11700) (hereinafter referred to as the ``2012 Final Rule'').\58\ On
October 24, 2018, HHS and the Department of the Treasury issued the
``State Relief and Empowerment Waivers'' guidance (83 FR 53575)
(hereinafter referred to as the ``2018 Guidance''), which superseded
the previous guidance published on December 16, 2015 (80 FR 78131), and
provided additional information about the requirements that states must
meet regarding section 1332 waiver proposals, the Secretaries'
application review procedures, pass-through funding determinations,
certain analytical requirements, and operational
considerations.59 60
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\57\ https://www.govinfo.gov/content/pkg/FR-2011-03-14/pdf/2011-5583.pdf.
\58\ https://www.govinfo.gov/content/pkg/FR-2012-02-27/pdf/2012-4395.pdf.
\59\ https://www.govinfo.gov/content/pkg/FR-2018-10-24/pdf/2018-23182.pdf.
\60\ https://www.govinfo.gov/content/pkg/FR-2015-12-16/pdf/2015-31563.pdf.
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Section 1332(a)(4)(B) of the PPACA also directs HHS and the
Department of the Treasury to issue regulations that provide for state
and Federal public notice and comment sufficient to ensure a meaningful
level of public input regarding a state's section 1332 waiver plan,
both during the application process and after a waiver is implemented.
Current regulations and guidance address how states may apply for a
waiver, information states must include in an application, public
notice and comment requirements, and HHS' and the Department of the
Treasury's monitoring and compliance activities, including state
reporting requirements (collectively referred to as public notice
procedures).
The Secretaries are setting forth a process for states to request
modifications to the public notice procedures during the PHE for COVID-
19 prior to and after approval of a section 1332 waiver that continue
to meet the statutory and regulatory requirements that the public has
an opportunity to provide meaningful input. Further the Secretaries are
promulgating this rule so that HHS and the Department of the Treasury
do not impose requirements that are unreasonable or unnecessarily
burdensome regarding state compliance consistent with section
1332(a)(4)(B)(iii) of the PPACA during the PHE for COVID 19. This IFC
promulgates rules to establish a framework for the Secretaries to
modify some of the existing regulatory public notice procedures to
expedite a decision on a proposed waiver request during the PHE for
COVID-19 when a delay would undermine or compromise the purpose of the
proposed waiver request and be contrary to the interests of consumers.
The Secretaries will also make available such flexibility regarding
public notice procedures should any state with an approved section 1332
waiver request an extension or amendment of an approved section 1332
waiver during the PHE for COVID-19.
Similarly, this IFC also establishes a framework for the
Secretaries to modify, in part, post award public notice procedures for
an approved waiver request that would otherwise take place or become
due during the PHE for COVID-19. The Secretaries will also make
available such flexibility for post award public notice procedures for
approved waiver extensions, amendments, or phase-out for a waiver
should those otherwise take place or become due during the PHE for
COVID-19. HHS and the Department of the Treasury are of the view that
section 1332 waivers are a critical tool for states to ensure patients
have stable access to health care coverage, including during the PHE
for COVID-19. These interim final provisions are effective immediately
for the duration of the PHE for COVID-19. HHS and the Department of the
Treasury note that existing threats to consumers' access to health
coverage or care--such as in geographic areas in which issuer
participation has been low for some time--would not be considered
emergency situations for purposes of applying the flexibilities adopted
in this rulemaking.
2. Public Notice Procedures and Approval Processes During the PHE (31
CFR 33.118 and 45 CFR 155.1318)
Section 1332(a)(4)(B) of the PPACA provides that the Secretary of
HHS and the Secretary of the Treasury shall issue regulations providing
a process for public notice and comment at the state level, including
public hearings, and a process for providing public notice and comment
after the application is received by the Secretaries, that are both
sufficient to ensure a meaningful level of public input. Current
regulations at Sec. Sec. 33.112 and 155.1312 specify state public
notice and participation requirements for proposed waiver requests, and
Sec. Sec. 33.116(b) and 155.1316(b) specify the accompanying public
notice and comment period requirements under the Federal public notice
and approval process.
[[Page 71178]]
Under the current regulations at Sec. Sec. 33.112 and 155.1312,
states are required to provide a public notice and comment period prior
to submitting an application for a new section 1332 waiver. The notice
must include a comprehensive description of the section 1332 waiver
application; information about where the application is available for
public review; where the written comments may be submitted; and the
location, date, and time of public hearings that will be convened by
the state to seek public input on the application for a section 1332
waiver.\61\ After issuing the public notice and prior to submitting an
application for a section 1332 waiver, the state must hold public
hearings to allow the public to learn about and comment on the state's
application, and must publish the date, time, and location of the
hearings in a prominent location on the state's public website.\62\ As
set forth in Sec. Sec. 33.112(a)(2) and 155.1312(a)(2), as part of the
public notice and comment period, a state with one or more federally
recognized tribes must conduct a separate process for meaningful
consultation with such tribes, if applicable. As HHS and the Department
of the Treasury explained in the 2012 Final Rule preamble, this tribal
consultation must be conducted in accordance with Executive Order
(E.O.) 13175, and, as E.O. 13175 also applies to Medicaid, a state may
use a Medicaid consultation process to satisfy the consultation needed
for a section 1332 waiver (77 FR 11700, 11706). Furthermore, the state
should include in its section 1332 waiver application a description of
issues raised and comments received.
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\61\ 31 CFR 33.112(b); 45 CFR 155.1312(b).
\62\ In response to a question from a commenter, the 2012 Final
Rule states that ``hearings,'' as used in 31 CFR 33.112(c)(1) and 45
CFR 155.1312(c)(1), means no less than two hearings. (77 FR 11700,
11706). The HHS and the Department of Treasury continue to interpret
the regulatory requirement that a State shall hold ``hearings'' to
refer to at least two hearings, except as otherwise provided by the
amendments made in this IFC. The existing regulation does not
expressly rely on the statutory requirement that the Secretaries of
HHS and Treasury establish ``a process for public notice and comment
at the State level, including public hearings . . . '' and HHS and
the Department of the Treasury are of the view that language, by
itself, does not require a particular state to hold more than one
hearing. Rather, the statutory language describes a process
applicable across multiple states, which will, in the aggregate,
necessarily involve multiple hearings.
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In addition, under section 1332(a)(4)(B)(iii) of the PPACA and the
existing implementing regulations at Sec. Sec. 33.116(b) and
155.1316(b), the Secretary of HHS and the Secretary of the Treasury are
required to provide a Federal public notice and comment period
following their preliminary determination that a state's section 1332
waiver application is complete.
Section 1332 waivers may vary significantly in their complexity and
breadth. The existing regulations generally provide states and the
Federal Government flexibility in determining and/or extending the
length of the comment periods. Both the state and the Federal public
notice and comment periods must be sufficient to ensure a meaningful
level of public input. The 2018 Guidance \63\ further specifies that
the state comment period should be no less than 30 days, and explains
that consistent with HHS regulations, waiver applications must be
posted online in a manner that meets technical standards for website
accessibility similar to applicable national standards \64\ to ensure
access for individuals with disabilities.
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\63\ 83 FR 53575 (https://www.govinfo.gov/content/pkg/FR-2018-10-24/pdf/2018-23182.pdf).
\64\ ``National standards'' refers to standards issued by the
Architectural and Transportation Barriers Compliance Board (often
referred to as ``section 508'' standards), or alternatively, the
World Wide Web Consortium's Web Content Accessibility Guidelines
(WCAG) 2.0 Level AA standards. See 83 FR 53575, 53583 (Oct. 24,
2018).
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HHS and the Department of the Treasury recognize that the current
section 1332 regulations regarding state and Federal public notice
procedures and comment period requirements may impose barriers for
states pursuing a proposed waiver request during the PHE for COVID-
19.\65\ It is the mission of HHS to enhance and protect the health and
well-being of all Americans. As such, HHS and the Department of the
Treasury are issuing this guidance to protect public health and to
prevent the spread of COVID-19 by limiting the need for in-person
gatherings related to section 1332 waivers during the PHE.
Additionally, states may face uncertainty as to whether their waiver
request will be approved in time, given the state and Federal public
notice procedures or other public participation requirement associated
with state procedures that would otherwise require an in-person
gathering, to expeditiously reform their health insurance markets and
to protect consumers from the effects of the PHE for COVID-19. Some
states may not consider more robust changes because they are concerned
that the current section 1332 waiver application requirements are too
time-consuming or burdensome to pursue during the PHE for COVID-19.
Therefore, HHS and the Department of the Treasury are of the view that
having the flexibility to modify certain public notice procedures and
participation requirements during the PHE for COVID-19 will protect
public health and health insurance markets, and will increase
flexibility and reduce burdens for states seeking to use section 1332
waivers as a means of innovation for providing coverage, lowering
premiums, and improving their health care markets.
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\65\ During the PHE for COVID-19, under the Secretaries'
discretion, HHS and the Department of the Treasury have allowed
states to conduct their public forums virtually, both prior to
application submission and post award. For example, following the
scheduling and notice of the hearings, and in consultation with CMS,
the New Hampshire Insurance Department rescheduled planned in-person
public hearings to an online webinar format in response to social
distancing guidance provided by New Hampshire Governor Chris Sununu
and the Federal government. (https://www.nh.gov/insurance/lah/documents/nh-section-1332-waiver-draft.pdf). Georgia also offered
public hearings virtually because of public health concerns
regarding large, in-person gatherings during the COVID-19 pandemic.
In addition, as of July 13, 2020, several states with approved
waivers conducted their post award forum virtually due to COVID-19,
including Alaska, Colorado, Delaware, Maine, Maryland, Minnesota,
Montana, Oregon, North Dakota, Rhode Island, and Wisconsin. In this
IFC, the Secretaries expand and build upon this approach by
providing more flexibility to allow HHS and the Department of the
Treasury to expedite a decision on a proposed waiver request.
(https://medicaid.georgia.gov/document/document/georgia1332waiverapplicationfinal07312020vfpdf/download).
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Section 1332 waivers are a critical tool for states to ensure
patients across the country have access to health care coverage. About
10.7 million individuals on average rely on the Exchanges to purchase
individual health insurance coverage throughout the
year.66 67 Although recently there have been positive
premium stabilization and insurer participation trends, the COVID-19
pandemic has introduced new uncertainties in the individual and small
group markets such that past trends resulting in limited access and
affordability may return in some areas. For example, in response to the
uncertainty created by the PHE for COVID-19 regarding health care
utilization rates and claims costs, such as those associated with
testing and treatment for COVID-19, premiums may increase and issuers
may reduce their presence or coverage options in the individual and
small group markets. Additionally, due to the PHE for COVID-19, some
issuers may have difficulty predicting the composition of their risk
pools given uncertainty about
[[Page 71179]]
the risk profiles of many new enrollees coming from employer-sponsored
coverage and the potential transition of other enrollees to Medicaid
due to income loss. Therefore, HHS and the Department of the Treasury
are concerned that past trends that threaten the stability of the
individual market risk pool may return, leading some issuers to cease
offering coverage on the Exchanges in some states and counties and
leading other issuers to increase their rates, leaving some geographic
areas with limited or no affordable Exchange coverage options.
Permitting the Secretary of HHS and the Secretary of the Treasury to
modify the public notice procedures, in part, will help states seeking
section 1332 waivers to address such circumstances more quickly and
develop innovative ways to ensure consumers have access to affordable
health care coverage. As such, HHS and the Department of the Treasury
are of the view that, if certain safeguards are met, it is in the best
interest of the public to provide states applying for section 1332
waivers with the option to request to modify public notice procedures
during the PHE for COVID-19.
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\66\ American Health Benefit Exchanges, or ``Exchanges,'' are
entities established under PPACA through which qualified individuals
and qualified employers can purchase health insurance coverage in
qualified health plans (QHPs).
\67\ First Half of 2020 Average Effectuated Enrollment Data,
available at https://www.cms.gov/CCIIO/Resources/Forms-Reports-and-Other-Resources/Downloads/Early-2020-2019-Effectuated-Enrollment-Report.pdf.
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This IFC adds the new Sec. Sec. 33.118 and 155.1318 and provides
that the Secretary of HHS and the Secretary of the Treasury may modify,
in part, the state public notice requirements specified in Sec. Sec.
33.112 and 155.1312 and the Federal public notice requirements
specified at Sec. Sec. 33.116(b) and 155.1316(b) to expedite a
decision on a proposed waiver request during the PHE for COVID-19 when
a delay would undermine or compromise the purpose of the proposed
waiver request and be contrary to the interests of consumers. Examples
of the public notice procedures that currently apply under the
aforementioned regulations that a state may seek to have waived or
modified include the requirement that states notify the public and hold
hearings prior to submitting an application, that the state hold more
than one public hearing in more than one location and that HHS and the
Department of the Treasury provide for public notice and comment after
an application is determined to be complete. States may also seek to
modify the state and/or Federal comment periods to be less than 30 days
and to host public hearings virtually rather than in-person.
For a state to qualify for modification of the state or Federal
public notice requirements to expedite a decision on a proposed waiver
request during the PHE for COVID-19, a delay must undermine or
compromise the purpose of the proposed waiver request and be contrary
to the interests of consumers. During the PHE for COVID-19, the
Secretary of HHS and the Secretary of the Treasury (the Secretaries)
may modify the Federal and/or state public notice procedures, in part,
if the state meets all of the following:
The state requests a modification in the form and manner
specified by the Secretaries.
The state acted in good faith, and in a diligent, timely,
and prudent manner in the preparation of the request for the
modification for the waiver, and the waiver application request.
The state details in its request for a modification, as
applicable, the reason(s) the state seeks a modification from the state
public notice procedures, describes how the state meets the
modification criteria, and describes the alternative public notice
procedures it proposes to implement at the state level, including
public hearings, that are designed to provide the greatest opportunity
and level of meaningful public input from impacted stakeholders that is
practicable given the emergency circumstances underlying the state's
request for a modification.
The state details in its request for a modification, as
applicable, the justification for the request and the alternative
public notice procedures it requests to be implemented at the Federal
level.
The state must, as applicable, implement the alternative
public notice procedures at the state level if the state's modification
request is approved and, if required, amend the waiver application to
specify that it is the state's intent to comply with those alternative
public notice procedures in the state's modification request.
Any state submitting a proposed waiver request during the PHE for
COVID-19 can submit a request to the Secretary of HHS and the Secretary
of the Treasury for this modification from the state and/or Federal
public notice procedures or include such a request in its section 1332
waiver application request.
The Secretary of HHS and the Secretary of the Treasury's review and
consideration of a modification request will vary based on the state's
circumstances, its modification request, and the complexity and breadth
of the state's proposed section 1332 waiver request. For example,
during the PHE for COVID-19, many states are prohibiting in-person
public gatherings or establishing stay-at-home orders due to the public
health threat.\68\ States seeking new section 1332 waiver(s) that have
such prohibitions in effect at the time they would have otherwise have
to conduct public notice would most likely be unable to comply with the
public notice requirements to hold two in-person public hearings prior
to submission of their section 1332 waiver applications in accordance
with the 2018 Guidance addressing requirements under Sec. Sec.
33.112(b) and 155.1312(b). In such cases, this IFC will allow the
Secretaries to grant the state's request to hold the two public
hearings virtually, rather than in-person, or to hold one public
hearing at the state level, rather than two public hearings at the
state level. As another example, the Secretaries may agree with a state
that, due to emergency circumstances that have arisen related to the
PHE for COVID-19, there is insufficient time for the state to provide
public notice and hold any public hearings at the state level prior to
submitting its section 1332 waiver application as required by
Sec. Sec. 33.112(a) and 155.1312(a), and grant the state's request to
provide public notice and hold public hearings at the state level after
the state submits its section 1332 waiver application.
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\68\ https://khn.org/morning-breakout/states-declare-emergencies-ban-large-gatherings-as-coronavirus-sweeps-the-nation/.
https://www.axios.com/states-shelter-in-place-coronavirus-66e9987a-a674-42bc-8d3f-070a1c0ee1a9.html.
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In situations where HHS and the Department of the Treasury
determine that public notice and hearings are warranted on a different
timeframe and may occur after the submission of a state's waiver
application request, the state will be required to amend the
application request as necessary to reflect public comments or other
relevant feedback received during the alternative public notice
procedures. HHS and the Department of the Treasury will evaluate a
state's request for a modification and issue their modification
determination within approximately 15 calendar days after the request
is received. In assessing whether a state acted in good faith, and in a
diligent, timely, and prudent manner in the preparation of the
modification request for the waiver, and for the waiver application,
HHS and the Department of the Treasury will evaluate whether the
relevant circumstances constitute an emergency.
HHS and the Department of the Treasury remind states that any
public participation processes must continue to comply with applicable
Federal civil rights laws, including taking reasonable steps to provide
meaningful access for individuals with limited English
[[Page 71180]]
proficiency and taking appropriate steps to ensure effective
communication with individuals with disabilities, including
accessibility of information and communication technology. Please note
that virtual meetings may present additional accessibility challenges
for people with communications and mobility disabilities, as well as to
those who lack broadband access. Ensuring effective communication may
include providing American Sign Language interpretation and real-time
captioning, and ensuring that the platform is interoperable with
assistive technology for those with mobility difficulties. HHS and the
Department of the Treasury especially encourage states to strive to
obtain meaningful input from potentially affected populations,
including low-income residents, residents with high expected health
care costs, persons less likely to have access to care, and members of
federally-recognized tribes, if applicable, as part of any alternative
public participation process.\69\
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\69\ As noted above, the HHS Office for Civil Rights enforces
applicable Federal civil rights laws as described above, as well as
laws protecting the exercise of conscience and religious freedom,
including the Religious Freedom Restoration Act (42 U.S.C. 2000bb
through 2000bb-4). HHS's requirements are subject to these laws, and
states may have obligations under these laws to protect conscience,
prohibit coercion, and to ensure the free exercise of religion. U.S.
Department of Health & Human Services, Office for Civil Rights,
Conscience and Religious Freedom, https://www.hhs.gov/conscience/ (last visited Aug. 20, 2020).
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The Secretary of HHS will publish on the CMS website any
modification determinations within 15 calendar days of the Secretary of
HHS and the Secretary of the Treasury making such a determination, as
well as the approved revised timeline for public comment at the state
and Federal level, as applicable. In addition, under the new Sec. Sec.
33.118 and 155.1318, the state will be required to publish on its
website any modification requests and determinations within 15 calendar
days of receipt of the determination, as well as the approved revised
timeline for public comment at the state and Federal level, as
applicable.
3. Monitoring and Compliance (31 CFR 33.120 and 45 CFR 155.1320)
As section 1332 waivers are likely to a have a significant impact
on individuals, states, and the Federal Government, the 2012 Final Rule
established processes and methodologies to ensure that the Secretary of
HHS and the Secretary of the Treasury receive adequate and appropriate
information regarding section 1332 waivers (consistent with section
1332(a)(4)(B)(iv) of the PPACA). Under Sec. Sec. 33.120(c) and
155.1320(c), to ensure continued public input within at least 6 months
after the implementation date, and annually thereafter, states are
required to hold a public forum at which members of the public have an
opportunity to provide comments on the progress of the program
authorized by the section 1332 waiver and to provide a summary of this
forum to the Secretary of HHS as part of the quarterly and annual
reports required under Sec. Sec. 33.124 and 155.1324. Under Sec. Sec.
33.120(c)(1) and 155.1320(c)(1), states are required to publish the
date, time, and location of the public forum in a prominent location on
the state's public website at least 30 days prior to the date of the
planned public forum.
This IFC adds new Sec. Sec. 33.120(c)(2) and 155.1320(c)(2), which
provide that the Secretary of HHS and the Secretary of the Treasury
(the Secretaries) may waive, in part, post award public notice
requirements for an approved waiver outlined in Sec. Sec. 33.120(c)
and 155.1320(c) during the PHE for COVID-19 when the application of the
post award public notice procedures would be contrary to the interests
of consumers during the PHE for COVID-19.
The Secretaries may modify the post award public notice procedures,
in part, when the state meets all of the following:
The state requests a modification in the form and manner
specified by the Secretaries.
The state acts in good faith, and in a diligent, timely,
and prudent manner to comply with the monitoring and compliance
requirements under the regulations and specific terms and conditions of
the waiver and to submit and prepare the request for a modification.
The state details in its request for a modification the
reason(s) the state seeks a modification from the state post award
public notice procedures, describes how the state meets the
modification criteria, and describes the alternative post award public
notice procedures it proposes to implement at the state level,
including public hearings, that are designed to provide the greatest
opportunity and level of meaningful public input from impacted
stakeholders that is practicable given the emergency circumstances
underlying the state's request for a modification.
As part of HHS and the Department of the Treasury's monitoring and
oversight of approved section 1332 waivers, the Secretary of HHS and
the Secretary of the Treasury, at their discretion, monitor the state's
compliance with the specific terms and conditions of the waiver
including, but not limited to, compliance with the guardrails,
reporting requirements, and the post award forum requirements. Under
the flexibilities provided in this IFC, the Secretaries may, for
example, allow the public forum for an approved waiver that would take
place or become due during the PHE for COVID-19 to be held virtually
rather than as an in person gathering. HHS and the Department of the
Treasury will work closely with states that have these approved
flexibilities through oversight and monitoring activities to ensure
open communication with states during the PHE for COVID-19. HHS and the
Department of the Treasury also will remain focused on ensuring the
public is informed about the implementation of programs authorized by
section 1332 waivers and have a meaningful opportunity to comment on
the implementation.
The Secretary of HHS and the Secretary of the Treasury will
evaluate a state's request for a modification and issue their
modification determination within approximately 15 calendar days after
the request is received. The state is required to publish on its
website any modification requests and determinations by HHS and the
Department of the Treasury within 15 calendar days of receipt of the
determination, as well as information on the approved revised timeline
for the state's post award public notice procedures, as applicable.
Since the state is already required to post materials as part of post
award annual reporting requirements, such as the notice for the public
forum and annual report, states will be responsible for ensuring that
the public is aware of the determination to modify the public notice
procedures and must include this information along with the information
required under Sec. Sec. 33.120(c)(1) and 155.1320(c)(1) in a
prominent location on the state's public website.
HHS and the Department of the Treasury are of the view that post
award forums are critical to ensure that the public has a regular
opportunity to learn about and comment on the progress of section 1332
waivers. States that receive approval, to modify, in part, these post
award public notice procedures would still need to meet all other
requirements specified in Sec. Sec. 33.112(b) and 155.1312(b). For
example, should the state receive a modification approval that permits
it to hold the post award public forum virtually instead of in person,
the state must still publish the notice of its post award public notice
on
[[Page 71181]]
the state's public website and use other effective means to communicate
the required information to the public. The public notice must include
the website, date, and time of the public forum that will be convened
by the state, information related to the timeframe for comments, and
how comments from the public on the section 1332 waiver must be
submitted. HHS and the Department of the Treasury remind states that
they still must also comply with Federal civil rights requirements,
including laws pertaining to accessibility, if the Secretary of HHS and
the Secretary of the Treasury approve a modification from all or a
portion of the post award public notice procedures. In such a
circumstance, the state would need to ensure these virtual public
hearings are as accessible as possible during the PHE for COVID-19 so
members of the public can participate and submit comments. The state
should also track how many people are attending these forums, if
possible.
V. Waiver of Proposed Rulemaking
Section 553(b) of the APA requires the agency to publish a notice
of the proposed rule in the Federal Register that includes a reference
to the legal authority under which the rule is proposed, and the terms
and substance of the proposed rule or a description of the subjects and
issues involved. Section 553(c) further requires the agency to give
interested parties the opportunity to participate in the rulemaking
through public comment before the provisions of the rule take effect.
Section 553(b)(B) authorizes the agency to waive these procedures,
however, if the agency finds good cause that notice and comment
procedures are impracticable, unnecessary, or contrary to the public
interest and incorporates a statement of the finding and its reasons in
the rule issued.
Section 553(d) ordinarily requires a 30-day delay in the effective
date of a final rule from the date of its publication in the Federal
Register. This 30-day delay in effective date can be waived, however,
if an agency finds good cause to support an earlier effective date.
Finally, the Congressional Review Act (CRA) requires a delay in the
effective date for major rules unless an agency finds good cause that
notice and public procedure are impracticable, unnecessary, or contrary
to the public interest, in which case the rule shall take effect at
such time as the agency determines. 5 U.S.C. 801(a)(3), 808(2).
As noted earlier in this preamble, on January 30, 2020, the
International Health Regulations Emergency Committee of the WHO
declared the outbreak a ``Public Health Emergency of international
concern.'' On January 31, 2020, pursuant to section 319 of the PHS, the
HHS Secretary determined that a PHE exists for the United States to aid
the nation's health care community in responding to COVID-19. On March
11, 2020, the WHO publicly declared COVID-19 a pandemic. On March 13,
2020, the President declared the COVID-19 pandemic a national
emergency. Effective October 23, 2020, the HHS Secretary renewed the
January 31, 2020 determination, which was previously renewed on April
21, 2020 and July 25, 2020, that a PHE exists and has existed since
January 27, 2020. This declaration, along with the HHS Secretary's
January 30, 2020 declaration of a PHE, conferred on the HHS Secretary
certain waiver authorities under section 1135 of the Act. On March 13,
2020, the HHS Secretary authorized waivers under section 1135 of the
Act, effective March 1, 2020.\70\
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It is critically important that the Departments implement the
policies in this IFC as quickly as possible. As the United States is in
the midst of the PHE for COVID-19, the Departments find good cause to
waive notice of proposed rulemaking under the APA, 5 U.S.C. 553(b)(B).
For those same reasons, as authorized by section 808(2) of the CRA, the
Departments find it is impracticable and contrary to the public
interest not to waive the delay in effective date of this IFC under
section 801 of the CRA. Therefore, the Departments find there is good
cause to waive the CRA's delay in effective date pursuant to section
808(2) of the CRA. Thus, the Departments find good cause to waive the
applicable delays in the effective date and, moreover, to establish
these policies in this IFC applicable as of the date of display at the
Office of the Federal Register.
In this IFC, consistent with section 1902(a)(4) and (a)(19) of the
Act, the Department adds a new subpart G to 42 CFR part 433 to provide
states with more flexibility, subject to certain safeguards, in
implementing the requirement in section 6008(b)(3) of the FFCRA that
states maintain Medicaid beneficiary enrollment in order to receive the
temporary increase in Federal funding in the FFCRA. This temporary
funding increase is effective beginning January 1, 2020 and could
extend through the last day of the calendar quarter in which the PHE
for COVID-19, including any extensions, terminates, if the state claims
the temporary funding increase in that quarter. This provision of the
IFC is immediately necessary to ensure that states can determine
eligibility and provide care and services during the PHE in a manner
that is consistent with simplicity of administration and the best
interests of beneficiaries and also claim the temporary funding
increase.
In this IFC, HHS and the Department of the Treasury are setting
forth flexibilities in the public notice and post award public
participation requirements for a State Innovation Waiver described in
section 1332 of PPACA during the PHE for COVID-19. HHS and the
Department of the Treasury recognize that following the normal state
and Federal public notice procedures and the state post award
requirements for section 1332 waivers may impose barriers for states
pursuing a proposed waiver request during the PHE for COVID-19. This
guidance is intended to protect public health and prevent the spread of
COVID-19 by limiting the need for in-person gatherings related to a
section 1332 waiver. Additionally, states may face uncertainty as to
whether their waiver requests will be approved in time to expeditiously
reform their health insurance markets and to protect consumers from the
effects of the PHE for COVID-19. Some states may not consider more
robust changes because they were concerned that the current section
1332 waiver application requirements are too time-consuming or
burdensome to be helpful during the PHE for COVID-19. HHS and the
Department of the Treasury are of the view that the flexibility to
modify certain public notice procedures and participation requirements
will increase flexibility and reduce burden for states seeking to use
section 1332 waivers as a means of innovation for providing coverage,
lowering premiums, and improving their health care markets during the
PHE for COVID-19. As such, these flexibilities are immediately
necessary to provide states applying for a section 1332 waiver or
during the post award period with the option to request a modification
from the state and/or Federal public notice requirements when a delay
would undermine or compromise the purpose of the waiver and be contrary
to the interests of consumers. HHS and the Department of the Treasury
are of the view that it could be contrary to the public interest to
require full notice and comment during the current PHE for COVID-19
because following the normal timeframes and requirements could result
in waiver approvals for
[[Page 71182]]
innovative waivers taking effect after issuers have already made their
decisions regarding issuer participation in the individual market and
after rates for the upcoming plan year have been submitted. A
modification from the public participation requirements would be
beneficial to the public interest by providing states and the Federal
Government the flexibilities necessary to review and approve, as
appropriate, section 1332 waivers that expand access to coverage on a
faster timeframe.
In this IFC, the Departments amend the regulations under section
2713 of the PHS Act to implement the requirement in section 3203 of the
CARES Act that non-grandfathered group health plans and health
insurance issuers offering non-grandfathered group or individual health
insurance coverage provide coverage without cost sharing for qualifying
coronavirus preventive services. This coverage must be provided within
15 business days after the date on which a recommendation is made by
the USPSTF or ACIP. The Departments also establish in this IFC that
this coverage must be provided regardless of whether the service is
delivered by an in-network or out-of-network provider.
The Departments are issuing these amendments under the authority of
section 9833 of the Code, section 734 of ERISA, and section 2792 of the
PHS Act. These sections authorize the Secretaries of the Treasury,
Labor, and HHS to promulgate any interim final rules that the
Secretaries determine are appropriate to carry out the provisions of
chapter 100 of the Code, part 7 of subtitle B of title I of ERISA, and
part A of title XXVII of the PHS Act, which include PHS Act sections
2701 through 2728 and the incorporation of those sections into ERISA
section 715 and Code section 9815. In addition, section 7805(e) of the
Code restricts any temporary regulation issued by Treasury and the IRS
under the Code, such as interim final regulations, to a duration of 3
years.
Several COVID-19 vaccine candidates are currently in late-stage
development. Once a vaccine is authorized or approved by FDA, the
Departments expect that ACIP may move expeditiously to recommend the
immunization. In addition, unlike other preventive items and services
typically provided according to regularly scheduled intervals, items
and services intended to prevent or mitigate COVID-19 will not, in the
immediate future, be provided as part of a usual course of preventive
care. Instead, the Departments expect consumers to receive these
services once they are recommended for the general public or specific
high-risk or high-priority populations. To help ensure full access to
and the widespread use of qualifying coronavirus preventive services to
mitigate the PHE for COVID 19, it is critical that individuals be able
to receive such services from any provider authorized to provide the
service. This is consistent with the objectives of Operation Warp
Speed, which, as mentioned above, is a partnership among components of
the Federal Government that engages with private firms to accelerate
the development, manufacture, and distribution of a COVID-19 vaccine to
the American people.
The provisions of this IFC therefore are immediately necessary to
ensure group health plan and group and individual health insurance
coverage of these items and services is prompt and broad, to ensure
timely access to combat the pandemic. In this IFC, the Department adds
a requirement at Sec. 417.454 to require section 1876 cost plans to
cover without cost sharing the COVID 19 vaccine and its administration
described in section 1861(s)(10)(A) of the Act without cost sharing for
the duration of the PHE for the COVID-19 pandemic, specifically the end
of the emergency period defined in paragraph (1)(B) of section 1135(g)
of the Act, which is the PHE declared by the Secretary on January 31,
2020 and any renewals thereof. While section 1876(c)(2) of the Act
ensures that enrollees in Medicare cost plans will have coverage of a
COVID-19 vaccine and its administration, section 3713 of the CARES Act
did not amend section 1876 of the Act to provide similar cost-sharing
protections for enrollees in cost plans who receive the vaccine from an
in-network provider. Currently, there is no requirement for cost plans
to cover the COVID-19 vaccine and its administration without cost
sharing (that is, with cost sharing that is the same as original
Medicare) when the vaccine is furnished by an in-network health care
provider. This provision of the IFC is immediately necessary to ensure
that cost plan enrollees, like other Medicare beneficiaries, are
provided access to the COVID-19 vaccine and its administration without
cost sharing. This immediate action will ensure that cost is not a
barrier for beneficiaries to get the vaccine, particularly during the
public health emergency when ensuring access is paramount importance.
The delay necessary for notice and comment rulemaking is both contrary
to the public interest and impractical here as it would delay access to
a COVID-19 vaccine without cost sharing and be contrary to the need to
ensure access to a COVID-19 vaccine for enrollees in cost plans on the
same basis as is ensured for other Medicare beneficiaries.
Further, as underscored by the timeline for coverage Congress
established in section 3203 of the CARES Act, the need to provide
coverage of qualifying coronavirus preventive services is urgent.
Following a recommendation of the USPTF or ACIP, the requirement to
provide coverage without cost sharing of qualifying coronavirus
preventive services, which are expected to include immunizations, takes
effect within 15 business days. Plans and issuers need immediate
guidance to understand their obligations under section 3203 of the
CARES Act and to take steps that will enable them to comply with those
requirements as soon as the coverage requirement goes into effect.
Delaying these provisions would likewise delay plans' and issuers'
ability to prepare for the availability of a COVID-19 vaccine,
resulting in barriers in access to coverage of these critical services
during the PHE for COVID-19. As of the date of display of this
regulation, there are not any coronavirus preventive services including
vaccines for coronavirus that are required to be covered. However,
because emergency use authorization or approval of a COVID-19 vaccine
may be imminent, the Departments are of the view it is critical that
these regulations under section 2713 of the PHS Act be issued and
effective prior to such authorization or approval. The Departments are
of the view that it would be impracticable and contrary to the public
interest to undertake normal notice and comment rulemaking procedures
in light of the urgent need to ensure coverage of and access to
qualifying coronavirus preventive services to protect the public health
as well as the health and safety of individuals and communities to
prevent the spread of COVID-19. For these same reasons, the Departments
are of the view a delayed effective date would also be contrary to the
public interest. Ensuring individuals have access to a COVID-19 vaccine
as soon as it becomes available is critical to ending the PHE for
COVID-19, and therefore it is imperative that these regulations are in
effect on the date such a vaccine becomes available and recommended by
ACIP. Undertaking the standard rulemaking process of publishing a
proposed rule, seeking public comment, carefully
[[Page 71183]]
analyzing those public comments, and subsequently publishing a final
rule would possibly and perhaps likely jeopardize such an effective
date.
The Departments are of the view that it would be impracticable and
contrary to the public interest to undertake normal notice and comment
procedures and to thereby delay the effective date of this IFC. The
Departments find good cause to waive notice of proposed rulemaking
under the APA, 5 U.S.C. 553(b)(B). For those same reasons, as
authorized by section 808(2) of the CRA, the Departments find it is
impracticable and contrary to the public interest not to waive the
delay in effective date of this IFC under section 801 of the CRA.
Therefore, the Departments find there is good cause to waive the CRA's
delay in effective date pursuant to section 808(2) of the CRA. The
provisions in this IFC will go into effect on the date of display.
This IFC implements the requirement that providers of diagnostic
tests for COVID-19 make public their cash prices for COVID-19
diagnostic tests and specifies the COVID-19 diagnostic tests to which
this requirement applies. This IFC further defines ``provider of a
diagnostic test for COVID-19'' (referred to as ``provider'') as any
facility that performs one or more COVID-19 diagnostic tests. In
addition, this IFC defines ``cash price'' as the charge that applies to
an individual who pays cash (or cash equivalent) for a COVID-19
diagnostic test. This IFC gives CMS discretion to take any of the
following actions if CMS determines a provider is noncompliant with the
requirements of new 45 CFR 182.50:
Provide a written warning notice to the provider of the
specific violation(s).
Request that a provider submit and comply with a CAP.
Impose a CMP on the provider if the provider fails to
respond to CMS' request to submit a CAP or to comply with the
requirements of a CAP approved by CMS.
As indicated above, these requirements are applicable during the
PHE for COVID-19 (and any extensions to the PHE for COVID-19);
therefore, it is critically important that we implement the policies in
this IFC as quickly as possible in order for stakeholders to know with
certainty during the PHE for COVID-19 how to comply with the law and
what penalties they will face for noncompliance during the PHE for
COVID-19. Moreover, these rules are necessary for CMS to enforce
section 3202(b) of the CARES Act and to ensure plans, issuers, and
consumers know in advance the price for a diagnostic test for COVID-19
during the PHE for COVID-19. For these reasons, we believe it would be
impracticable and contrary to the public interest to undertake normal
notice and comment rulemaking procedures and to delay the effective
date of the new requirements being adopted at 45 CFR part 182.
In this IFC, the Department creates a New COVID-19 Treatments Add-
on Payment (NCTAP) under the Inpatient Prospective Payment System
(IPPS) for COVID-19 cases that meet certain criteria. The Department is
of the view that it would be impracticable and contrary to the public
interest to undertake normal notice and comment procedures and to
thereby delay the effective date of this IFC. As drug and biological
products become available and are authorized or approved by FDA for the
treatment of COVID-19 in the inpatient setting, there may be potential
financial disincentives for hospitals to provide these new COVID-19
treatments to Medicare inpatients during the PHE because the costs of
these new treatments are not yet reflected in Medicare payment rates
and there are no new technology add-on payments for these treatments.
The delay necessary for notice and comment rulemaking is both contrary
to the public interest and impracticable because of the urgency in
ensuring there are not financial disincentives for hospitals to provide
COVID-19 treatments to beneficiaries during the PHE. We expect that
increasing the current IPPS payment amounts for sufficiently costly
cases to mitigate potential financial disincentives for hospitals to
provide new COVID-19 treatments during the PHE will potentially improve
and speed access to these treatments for Medicare patients. We also
believe that the establishment of the NCTAP provides greater
transparency and predictability to the public, including innovators
that are developing new COVID-19 treatments, as to how Medicare
payments for cases involving these treatments will be determined when
those treatments become available.
In this IFC, the Department assures separate payment for new COVID-
19 treatments provided in the outpatient setting for the remainder of
the Public Health Emergency for COVID-19. The Department is of the view
that it would be impracticable and contrary to the public interest to
undertake normal notice and comment procedures and to thereby delay the
effective date of this IFC. We anticipate that most drugs and
biological products authorized or approved for use in treating COVID-19
in the outpatient setting would be separately paid under our standard
OPPS payment policy; however, these products could be packaged into a
Comprehensive Ambulatory Payment Classification (C-APC) payment when
provided on the same claim as a C-APC service, in which case separate
payment would not be made for these products. Although we do not expect
that many beneficiaries would both receive a primary C-APC service and
a drug or biological for treating COVID-19, we nonetheless believe that
as drugs or biologicals become available and are authorized or approved
for the treatment of COVID-19 in the outpatient setting, it would be
appropriate to mitigate any potential financial disincentives for
hospitals to provide these new treatments during the PHE for COVID-19.
The delay necessary for notice and comment rulemaking to address this
issue is both contrary to the public interest and impracticable because
of the urgency in ensuring there are not financial disincentives for
hospitals to provide COVID-19 treatments to beneficiaries. Therefore,
effective for services furnished on or after the effective date of this
rule and until the end of the PHE for COVID-19, CMS is creating an
exception to its OPPS C-APC policy to ensure separate payment for new
COVID-19 treatments that meet certain criteria.
In this IFC, the Department adds changes to the CJR model that are
immediately necessary to continue the CJR model consistent with model
goals to, cover inpatient major lower joint replacements without
interruption, and to reduce operational and financial uncertainty for
CJR hospital participants during and beyond the PHE. Ending on March
31, 2021 would be disruptive to hospitals and patient care during the
PHE. The end date of March 31, 2021, means hospitals stop initiating
episodes under the model after January 2, 2021, before the end of the
public health emergency as renewed on October 23, 2020.\71\ Extending
the model through an additional six months of performance year (PY) 5,
so that PY 5 now ends on September 30, 2021, provides participant
hospitals with greater certainty in model operations during the
remainder of the PHE.
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Through this IFC we are implementing four changes to the CJR model
needed to extend PY 5. These are: (1) Extending PY 5 an additional 6
months to provide for continuity of model operations with the same
scope while we continue to consider comments received on our proposal
to extend the model to PYs 6 through 8 and adopt other changes to the
model
[[Page 71184]]
(42 CFR 510.2 and 510.200(a)); (2) making changes to the reconciliation
process for PY 5 to allow for two periods and to enable more frequent
receipt of reconciliation reports by participants (42 CFR 510.2, 42 CFR
510.200, 42 CFR 510.305(b), (d)(1), (e), (i)(1) and (2), and (j)(1) and
(2), and 42 CFR 510.400(b)(3)(v), and adding 42 CFR 510.400(b)(3)(vi));
(3) making a technical change, retroactive to October 1, 2020, to
ensure that the model continues to include the same inpatient Lower
Extremity Joint Replacement (LEJR) procedures, despite the adoption of
new MS-DRGs to describe those procedures (42 CFR 510.300(a)(1)(i) and
(iii)); and (4) making changes to the extreme and uncontrollable
circumstances policy for COVID-19 to adapt to an increase in CJR
episode volume and renewal of the PHE, while providing protection
against financial consequences of COVID-19 after the extreme and
uncontrollable circumstances policy no longer applies (42 CFR 510.300).
Implementing an additional six months of PY 5, so that PY 5 now
ends on September 30, 2021 (hospitals stop initiating new episodes
under the model after July 2, 2021) provides participant hospitals
additional relief and stability in model operations while the end of
the PHE remains unknown. We have modified the reconciliation process to
provide payments consistent with the current annual reconciliation
schedule for hospitals for greater stability. Absent modification to
the reconciliation process, the extension of PY 5 to a total of 21
months, from January 1, 2020 through September 30, 2021 would mean that
participant hospitals would experience a 21-month gap between the PY4
final reconciliation in June of 2020 and initial PY 5 reconciliation in
early 2022. In the FY 2021 IPPS/LTCH final rule, we stated that because
the CJR model would continue until at least March 31, 2021, we intended
to adopt a policy in the CJR final rule that incorporates new MS-DRGs
for the same procedures currently included in the CJR model, under
prior MS-DRGs, as of their effective date to avoid disruption to the
model for the remainder of PY5 (as extended) and thereafter, if our
proposal to extend the CJR model through PY8 were finalized (85 FR
58502). We are adopting the change in this IFC, retroactive to October
1, 2020 because without a change the model ceases to continue as a
comprehensive joint replacement model. Not making this change would
have a significant impact on operational stability. Finally, this
interim final rule with comment specifies an end for the current
extreme and uncontrollable adjustment in 42 CFR 510.300(k)(4). In order
to provide participant hospitals continuing financial protection from
the effect of COVID-19 on the CJR model that may continue beyond the
end of the PHE for COVID-19 or March 31, 2021, whichever occurs
earlier, we are implementing that actual episode payments are capped at
the quality adjusted target price determined for that episode under
Sec. 510.300 for episodes with actual episode payments that include a
claim with a COVID-19 diagnosis code and initiate after the earlier of
March 31, 2021 or the last day of the emergency period. This policy is
consistent with flexibilities and protections for impact of COVID-19 in
other Innovation Center models. For all of these revisions, we believe
it is contrary to the public interest to undertake traditional notice
and comment rulemaking to adopt these regulatory changes because they
preserve the model's scope and operations at current levels, fostering
model stability now and in the future for hospital operations during
and beyond the PHE.
VI. Collection of Information Requirements
Under the Paperwork Reduction Act of 1995, the Departments are
required to provide 30-day notice in the Federal Register and solicit
public comment before a collection of information requirement is
submitted to 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 (PRA) requires
that the Departments solicit comment on the following issues:
The need for the information collection and its usefulness
in carrying out the proper functions of the agency.
The accuracy of the 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.
The Departments are soliciting public comment on each of the
section 3506(c)(2)(A)-required issues for the following information
collection requirements (ICRs). The requirements and burden will be
submitted to under OMB Control Number 0938-NEW.
A. ICRs for Price Transparency for COVID-19 Diagnostic Tests
As discussed in section II.C of this IFC, section 3202(b) of the
CARES Act establishes a requirement to publicize cash prices for COVID-
19 diagnostic tests during the PHE. For purposes of implementing
section 3202(b) of the CARES Act, we are adding new 45 CFR part 182,
``Price Transparency for COVID-19 Diagnostic Tests,'' that will codify
price transparency requirements for the performance of a COVID-19
diagnostic test.
There are several types of COVID-19 tests designed to detect SARS-
CoV-2 or to diagnose a possible case of COVID-19, including: molecular
(RT-PCR) tests, which are used to detect the virus's genetic material;
antigen tests, which are used to detect specific proteins on the
surface of the virus; and serology testing, which is used to look for
the presence of antibodies produced by the body in response to
infections.
For purposes of 45 CFR part 182, we are defining ``provider of a
diagnostic test for COVID-19'' as any facility that performs one or
more COVID-19 diagnostic tests. In order to perform a diagnostic test
for COVID-19 and report patient-specific results, a facility (whether
that be a primary care provider's office, urgent care center,
outpatient hospital site or stand-alone laboratory) is required to hold
a CLIA certificate based on the complexity of the testing performed by
the facility. Therefore, we expect that any ``provider of a COVID-19
diagnostic test'' would hold a CLIA certificate (including a
certificate of waiver or certificate of registration) and that such
testing would occur in facilities ranging from primary care provider
offices to urgent care centers to stand-alone national laboratories.
As explained in section VIII.B of this IFC, we estimate that
approximately 83,309 CLIA providers could potentially be performing
COVID-19 diagnostic tests and need to publicize their cash prices. For
purposes of this IFC, we are estimating it will take a business
operations specialist (13-1000), on average 1 hour for a total of
83,309 burden hours to compile and make public the cash prices for
COVID-19 diagnostic tests, at an hourly wage of $36.31 as published by
the BLS in 2019.\72\ We estimate the overhead and fringe benefit cost
to be 100 percent of wages. Therefore, we estimate a one-time cost per
provider to be $72.62
[[Page 71185]]
($36.31 x 2) and the total cost estimated to be $6,049,900 (83,309
hours x $72.62) to collect, compile and post the required information.
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\72\ Bureau of Labor Statistics. National Occupational
Employment and Wage Estimates, May 2019. Available at: https://www.bls.gov/oes/current/oes_nat.htm#13-0000.
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B. ICRs for State Innovation Waivers Policy and Regulatory Revision in
Response to COVID-19 Public Health Emergency
This IFC provides that states are required to submit modification
requests to the Secretary of HHS and the Secretary of the Treasury in
order to obtain approval for the modifications made available by this
IFC. Any state can submit a request to the Secretaries for a
modification from the state and/or Federal public notice procedures or
include such a request in their section 1332 waiver application if the
waiver application is submitted during the PHE for COVID-19. The
request must describe the reason the state seeks a modification from
the state public notice procedures, describe how the state meets the
modification criteria, describe the alternative public notice
procedures it proposes to implement at the state level, including
public hearings, that are designed to provide the greatest opportunity
and level of meaningful public input from impacted stakeholders that is
practicable given the emergency circumstances underlying the state's
request for a modification. The request must describe the reason the
state seeks a modification from the Federal public notice procedures
and the alternative public notice procedures it requests to be
implemented at the Federal level, as applicable.
A state with an approved section 1332 waiver can submit a request
to HHS and the Department of Treasury for a modification from post
award public notice procedures. The request must specify the reason the
state seeks a modification from the post award public notice
procedures, describe how the state meets the modification criteria, and
describe the alternative procedures it proposes to implement at the
state level, including public hearings, that are designed to provide
the greatest opportunity and level of meaningful public input from
impacted stakeholders that is practicable given the emergency
circumstances underlying the state's request for a modification.
While HHS and the Department of Treasury do not have data available
to predict the number of states that will likely request a modification
of either the waiver application or the post award public notice
procedures, HHS and the Department of Treasury estimate it will take a
senior manager 1 hour to prepare a state's request, with an equivalent
cost of approximately $118.\73\ In addition, if HHS and the Department
of Treasury approve a state's modification request, the state will have
to post the determination on their website within 15 days of the
approval. HHS and the Department of Treasury estimate that for each
state, it will take a network and computer systems administrator 15
minutes to post the approval with an equivalent cost of approximately
$21.\74\ Assuming that approximately 15 states will submit a
modification request, the total burden hours for all states will be 15
hours, with an equivalent cost of approximately $1,775. HHS and the
Department of Treasury have assumed that 15 states will submit a
request because, as of display of this IFC, 15 states have an approved
1332 waiver. This is an upper bound, since some states may not need to
request the available modification for their waivers, and therefore,
will incur no burden. Furthermore, assuming that approximately 15
states receive approval of the modification request and then must post
the approval, the total burden hours for all states will be
approximately 3.75 hours, with an equivalent cost of approximately
$319. This is an upper bound, since some states may not receive
approval, and therefore, will incur a lower (or no) burden. The total
estimated burden hours assuming approximately 15 states apply for and
receive approval of the modification request is 18.75 hours, with an
equivalent cost of approximately $2,094.
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\73\ Using data from the Bureau of Labor Statistics (BLS) for
General and Operations Managers (Code 11-1020), we estimate that the
average hourly labor cost will be $118.30, including 100 percent
increase for overhead and fringe benefits. https://www.bls.gov/oes/current/oes_stru.htm.
\74\ Using data from the BLS for Network and Computer Systems
Administrators (Code 15-1244), we estimate that the average hourly
labor cost will be $85.02, including 100 percent increase for
overhead and fringe benefits. https://www.bls.gov/oes/current/oes_stru.htm.
Table 3--Estimated Cost and Burden Hours per Respondent
----------------------------------------------------------------------------------------------------------------
Average burden
hour per Hourly wage Total cost per
BLS occupation respondent (in rates respondent
hours)
----------------------------------------------------------------------------------------------------------------
Senior Manager.................................................. 1 $118.30 $118.30
Network and Computer Systems Administrator...................... 0.25 85.02 21.26
-----------------------------------------------
Total....................................................... 1.25 .............. 139.56
----------------------------------------------------------------------------------------------------------------
Table 4--Estimated Total Cost and Burden for all Respondents
----------------------------------------------------------------------------------------------------------------
Number of Number of Burden hours Total burden
respondents responses per respondent hours Total cost
----------------------------------------------------------------------------------------------------------------
Modification Request............ 15 15 1 15 $1,775
Posting modification approval... 15 15 0.25 3.75 319
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Total....................... 15 .............. 1.25 18.75 2,094
----------------------------------------------------------------------------------------------------------------
[[Page 71186]]
C. ICRs Regarding the Comprehensive Joint Replacement (CJR) Model
Section 1115A(d)(3) of the Social Security Act exempts the Center
for Medicare and Medicaid Innovation (CMMI) model tests and expansions,
from the PRA. The section provides that Chapter 35 of title 44, United
States Code, which includes such provisions as the PRA, shall not apply
to the testing and evaluation of CMMI models or expansion of such
models.
D. ICRs Regarding Enrollment as Mass Immunization Roster Biller
As discussed in section II.A.1. of this IFC, a mass immunizer may
be enrolled in Medicare as another type of provider or supplier such as
a physician, non-physician practitioner, hospital outpatient
department, home health agency, or skilled nursing facility. However,
an entity that does not otherwise qualify as a Medicare provider or
supplier but wishes to furnish mass immunization services may be
eligible to enroll in Medicare as a ``Mass Immunization Roster Biller''
via the Form CMS-855B enrollment application (Medicare Enrollment
Application: Clinics/Group Practices and Certain Other Suppliers; OMB
Control No.: 0938-0685; Expires 12/21).
This section discusses our burden estimates for the enrollment of
mass immunization roster billers via the Form CMS-855B application as
well as the PRA exemption we are claiming for the appeals process.
1. Cost of Completing Form CMS-855B
Using our internal data, we generally estimate that approximately
60,000 entities (the preponderance of which will be pharmacies) will
seek to enroll as mass immunization roster billers pursuant to the IFC,
all of whom will attempt enrollment in the 12-month period following
the IFC's display. According to the most recent wage data provided by
the Bureau of Labor Statistics (BLS) for May 2019 (see https://www.bls.gov/oes/current/oes_nat.htm), the mean hourly wages for the
following categories are:
Table 5--National Occupational Employment and Wage Estimates
----------------------------------------------------------------------------------------------------------------
Fringe
Occupation Mean hourly benefits and Adjusted
Occupation title code wage ($/hr) overhead ($/ hourly wage ($/
hr) hr)
----------------------------------------------------------------------------------------------------------------
Healthcare Diagnosing or Treating Practitioners. 29-1000 49.26 49.26 98.52
Medical Secretaries and Administrative 43-6013 18.31 18.31 36.62
Assistants.....................................
----------------------------------------------------------------------------------------------------------------
Consistent with Form CMS-855B projections made in recent rulemaking
efforts, it will take each entity an average of 2.5 hours to obtain and
furnish the information on the Form CMS-855B. Per our experience, the
entity's medical secretary will secure and report this data, a task
that would take approximately 2 hours. Additionally, a health
diagnosing and treating practitioner of the entity will review and sign
the form, a process we estimate takes 30 minutes. We therefore project
a total burden of 150,000 hours (60,000 suppliers x 2.5 hrs) at a cost
of $7,350,000 (60,000 suppliers x ((2 hrs x $36.62/hr) + (0.5 hrs x
$98.52/hr)). When averaged over the typical 3-year OMB approval period,
we estimate an annual burden of 50,000 hours (150,000 hrs/3) at a cost
of $2,450,000 ($7,350,000/3).
2. Appeals
Pursuant to 42 CFR part 498, a mass immunization roster biller may
appeal the denial or revocation of its enrollment. While there are
information collection requirements associated with the appeals
process, we believe they are exempt from the PRA. In accordance with
the implementing regulations of the PRA at 5 CFR 1320.4(a)(2), the
information collection requirements associated with the appeals process
are subsequent to an administrative action (specifically, the denial or
revocation of a mass immunization roster biller's enrollment).
Therefore, we have not developed burden estimates. We also believe that
any costs associated with mass immunization roster biller enrollment
will, in any event, be de minimis; this is because we anticipate, based
on past experience, there would be comparatively few denials and
revocations of such enrollments.
Response to Comments
Because of the large number of public comments normally received on
Federal Register documents, the Departments are not able to acknowledge
or respond to them individually. All comments received by the date and
time specified in the DATES section of this preamble will be
considered, and, when the Departments proceed with a subsequent
document, the Departments will respond to the comments in the preamble
to that document.
Regulatory Impact Analysis
A. Statement of Need
The flexibilities and changes contained within this IFC are
responsive to the PHE for COVID-19. The policies implemented in this
IFC will provide flexibilities, during the PHE for COVID-19, to states
pursuing waivers under section 1332 of the PPACA and to states with
approved section 1332 waivers. Additionally, the policies and
regulatory updates implemented in this IFC will increase the
affordability with regards to section 1332 waiver applications and
support continuity of health insurance coverage for consumers in the
individual and small group (or merged) market during the PHE for COVID-
19. This IFC also implements section 3202(b) of the CARES Act, which
requires that providers of COVID-19 diagnostic tests make public their
cash prices for those tests and establishes an enforcement scheme to
enforce those requirements during the PHE for COVID-19.
In section 3203 of the CARES Act, Congress required group health
plans and issuers of group or individual health insurance coverage to
cover without cost sharing qualifying coronavirus preventive services,
and required such coverage to be provided within 15 business days after
the date on which an applicable recommendation is made relating to such
service. The Departments codify these requirements in this IFC, and
finalize amendments to the regulations implementing section 2713 of the
PHS Act at 26 CFR 54.9815-2713; 29 CFR 2590.715-2713; and 45 CFR
147.130 that are intended to help ensure full access to and the
widespread use of qualifying coronavirus preventive services to
mitigate the public health emergency.
B. Overall Impact
The Departments have examined the potential impacts of this rule as
required by Executive Order 12866 on Regulatory Planning and Review
(September 30, 1993), Executive Order 13563 on Improving Regulation and
Regulatory
[[Page 71187]]
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), Executive Order 13132 on Federalism (August 4,
1999), the Congressional Review Act (5 U.S.C. 804(2)), and Executive
Order 13771 on Reducing Regulation and Controlling Regulatory Costs
(January 30, 2017).
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Section
3(f) of Executive Order 12866 defines a ``significant regulatory
action'' as an action that is likely to result in a rule: (1) Having an
annual effect on the economy of $100 million or more in any one year,
or adversely and materially affecting a sector of the economy,
productivity, competition, jobs, the environment, public health or
safety, or state, local or tribal governments or communities (also
referred to as ``economically significant''); (2) creating a serious
inconsistency or otherwise interfering with an action taken or planned
by another agency; (3) materially altering the budgetary impacts of
entitlement grants, user fees, or loan programs or the rights and
obligations of recipients thereof; or (4) raising novel legal or policy
issues arising out of legal mandates, the President's priorities, or
the principles set forth in the Executive Order.
A regulatory impact analysis (RIA) must be prepared for major rules
with economically significant effects ($100 million or more in any one
year), and a ``significant'' regulatory action is subject to review by
the OMB. The Departments have determined that these rules are likely to
have economic impacts of $100 million or more in at least one year, and
thus, meet the definition of ``economically significant'' under
Executive Order 12866 and a major rule under the Congressional Review
Act. Therefore, the Departments have provided an assessment of the
potential costs, benefits, and transfers associated with this rule. In
accordance with the provisions of Executive Order 12866, this
regulation was reviewed by OMB.
C. Detailed Economic Analysis
1. Effect of Price Transparency for COVID-19 Diagnostic Tests During
the PHE
As discussed in section II.C of this IFC, Section 3202(b) of the
CARES Act establishes a requirement to publicize cash prices for COVID-
19 diagnostic tests during the PHE. For purposes of implementing
section 3202(b) of the CARES Act, we are adding new 45 CFR part 182,
``Price Transparency for COVID-19 Diagnostic Tests,'' that will codify
price transparency requirements for the actual performance of a COVID-
19 diagnostic test. At Sec. 182.20, we are defining a ``COVID-19
diagnostic test'' as a COVID-19 in vitro diagnostic test described in
section 6001 of the FFCRA, as amended by section 3201 of the CARES Act.
This IFC defines a ``provider of a diagnostic test for COVID-19''
(referred to as ``provider'') as any facility that performs one or more
COVID-19 diagnostic tests. In order to perform a COVID-19 diagnostic
tests and report patient-specific results, a facility is required to
hold a CLIA certificate based on the complexity of the testing
performed by the facility. This IFC requires providers of COVID-19
diagnostic tests to make public the cash price for such tests on a
public internet website of such provider during the emergency period
declared under section 319 of the PHS Act. In the event that a provider
does not have its own website on which to post this cash price
information, Sec. 182.40(b) states that the provider would be required
to make public its cash price information in writing, within two
business days upon request, and by posting signage prominently at the
provider's COVID-19 diagnostic testing location, if such location is
accessible to the public.
We anticipate that price transparency has potential beneficial
marketplace benefits generally, as discussed in detail in the CY 2020
Hospital Outpatient PPS Policy Changes and Payment Rates and Ambulatory
Surgical Center Payment System Policy Changes and Payment Rates, Price
Transparency Requirements for Hospitals To Make Standard Charges Public
Final Rule (84 FR 65524) and the Transparency in Coverage Proposed Rule
(84 FR 65464). As noted in section II.C of this IFC, section 3202 of
the CARES Act addresses reimbursement of COVID-19 diagnostic tests.
Section 3202(a) of the CARES Act requires group health plans and
issuers that provide coverage for items and services described in
section 6001(a) of the FFCRA to reimburse any provider of a COVID-19
diagnostic test an amount that equals the negotiated rate, or, if the
plan or issuer does not have a negotiated rate with the provider, the
cash price for such service that is listed by the provider on a public
website. We anticipate that price transparency in COVID-19 diagnostic
testing, in particular, will help improve clarity for consumers and the
plans and issuers that are required to cover the cost of performing a
COVID-19 diagnostic test when there is no negotiated rate between the
plan or issuer and the provider. For individuals without insurance and
for health plans and health insurance issuers attempting to negotiate a
rate for performance of a COVID-19 diagnostic test with a provider that
has posted its cash price, that cash price could provide some context
and a baseline against which those negotiations can occur. Moreover,
price transparency in COVID-19 diagnostic tests will assist the
uninsured in determining the cash price at various providers when price
shopping for COVID-19 diagnostic tests.
Assessments of broader transparency policies yield per-capita
estimates of annual expenditure reductions ranging from between $3 and
$5 (= $2.8 million + $1.3 million + $7.0 million + $2.3 million two-
year savings, across 1.3 million California public employees and their
family members, per Boynton and Robinson (2015)), to $6.50 (= $7.9
million + $36 million five-year savings found by Brown (2018), divided
across the 1.36 million residents of New Hampshire), to $17 (= $13.2
million three-year savings across 0.26 million beneficiaries, per
Rhoads (2019)).\75\ If the $6.50 median result is extrapolated from the
context of general health spending--which is approximately $10,000 per
capita in the United States--to a range of between $60 and $1,200 in
COVID-19 diagnostic testing (= $60 per test, across between one and 20
tests), the estimate of rule-induced reductions in annual consumer
expenditures could range from $13 million to $254 million. (This
expenditure change combines transfers (to patients or insurers from
providers)
[[Page 71188]]
with potential societal resource cost savings; only the latter portion
should be compared against estimates of the provision's administrative
and paperwork costs.) We note, however, that this estimate is based on
annual expenditure reductions; because this requirement is only
applicable for the remainder of the PHE, which may be less than a year,
the saving impact is likely to be lower.
---------------------------------------------------------------------------
\75\ Boynton, A., and Robinson, J. ``Appropriate Use of
Reference Pricing Can Increase Value.'' Health Affairs Blog. July 7,
2015. Available at: https://www.healthaffairs.org/do/10.1377/hblog20150707.049155/full/. Brown, Z. Y. ``Equilibrium Effects of
Health Care Price Information.'' 100 Rev. of Econ. and Stat. 1. July
16, 2018. Available at: https://www-personal.umich.edu/~zachb/
zbrown_eqm_effects_price_transparency.pdf. Rhoads, J. ``Right to
Shop for Public Employees: How health care incentives are saving
money in Kentucky.'' The Dartmouth Institute for Health Policy and
Clinical Practice. March 8, 2019. Available at: https://thefga.org/wp-content/uploads/2019/03/RTS-Kentucky-HealthCareIncentivesSavingMoney-DRAFT8.pdf.
---------------------------------------------------------------------------
To comply with the regulatory updates in this IFC, providers would
need to review their billing practices and determine their ``cash
price'' for COVID-19 diagnostic tests. They would further need to
publicly post the cash prices for all COVID-19 diagnostic tests along
with associated plain language descriptions and HCPCS or CPT billing
codes. The provider would be required to make all of this information
public on the provider's internet website. As discussed in section
VI.C, we estimate it would take a Business Operations Specialist, on
average 1 hour to compile and make public the cash prices for the
COVID-19 diagnostic tests that the facility offers at an hourly wage of
$36.31 as published by the 2019 Bureau of Labor Statistics.\76\ We
estimate the overhead and fringe benefit cost to be 100 percent of
wages. Therefore, we estimate a one-time cost per provider to be $72.62
(36.31 x 2).
---------------------------------------------------------------------------
\76\ Bureau of Labor Statistics. National Occupational
Employment and Wage Estimates, May 2019. Available at: https://www.bls.gov/oes/current/oes_nat.htm#13-0000.
---------------------------------------------------------------------------
We expect that approximately 30 percent \77\ (n = 83,309) of the
total CLIA-certified laboratories (n = 277,699 \78\) could potentially
be performing COVID-19 diagnostic tests and need to publicize their
cash prices in such form and manner as prescribed in new 45 CFR part
182 during the PHE for COVID-19, including any subsequent renewals. The
total cost is estimated to be $ $6,049,900 (83,309 hours x $72.62) to
collect, compile and post the required information.
---------------------------------------------------------------------------
\77\ Consistent with the percent of laboratories required to
report COVID-19 diagnostic test results in CMS-3401-IFC.
\78\ As of October 11, 2020, according to the Certification and
Survey Provider Enhanced Reporting system this includes Certificate
of Waiver (210,669), Certificate of Provider-Performed Microscopy
(31,992), Certificate of Compliance (19,044) and Certificate of
Accreditation (15,994). Available at: https://qcor.cms.gov/CLIA_wizard.jsp?which=4&report=active_CLIA.jsp.
---------------------------------------------------------------------------
We seek comment on the burden estimate for providers of a
diagnostic test for COVID-19, specifically the number of burden hours
estimated to post their cash price for COVID-19 diagnostic test.
2. Effects of Medicare Inpatient Prospective Payment System (IPPS) New
COVID-19 Treatments Add-on Payment (NCTAP) for the Remainder of the
Public Health Emergency (PHE)
As drug and biological products become available and are authorized
or approved by FDA for the treatment of COVID-19 in the inpatient
setting, there may be potential financial disincentives for hospitals
to provide these new COVID-19 treatments to Medicare inpatients during
the PHE because the costs of these new treatments are not yet reflected
in Medicare payment rates and there are no new technology add-on
payments for these treatments. We expect that increasing the current
IPPS payment amounts for sufficiently costly cases to mitigate
potential financial disincentives for hospitals to provide new COVID-19
treatments during the PHE will potentially improve and speed access to
these treatments for Medicare patients. We also believe that the
establishment of the NCTAP provides greater transparency and
predictability to the public, including innovators that are developing
new COVID-19 treatments, as to how Medicare payments for cases
involving these treatments will be determined when those treatments
become available.
Given it is unknown what the cost and utilization of inpatient
stays using these new treatments will be, the net overall cost of the
NCTAP policy is not estimable. On one extreme, if all of the new COVID-
19 treatments decrease the net cost of hospitalizations (for example,
due to shortened lengths of stay), including the cost of the new
treatment, below the Medicare payment as increased by section 3710 of
the CARES Act then there would be no NCTAP payments made and no
additional cost to the Medicare program as a result of this policy. On
the other extreme, if all of the new COVID-19 treatments result in the
net cost of hospitalizations that exceed the outlier threshold (for
example, due to the cost of the new treatment), the cost to the
Medicare program would be the sum over all NCTAP cases of 0.65 times
the outlier threshold for each case.
3. Effects of the Medicare Outpatient Prospective Payment System (OPPS)
Separate Payment for New COVID-19 Treatments Policy for the Remainder
of the Public Health Emergency (PHE) for COVID-19
This IFC provides for separate payment for New COVID-19 Treatments
under the Outpatient Prospective Payment System (OPPS) for the
remainder of the PHE for COVID-19 when these treatments are provided at
the same time as a Comprehensive Ambulatory Payment Classification (C-
APC) service. As we noted in Section II.E.2, we believe it would be a
fairly rare occurrence that an outpatient department would perform a C-
APC procedure on a beneficiary being treated for COVID-19 because most
C-APCs are for surgical or other intensive procedures and we would
expect most hospital outpatients departments would not perform
outpatient surgery on a patient that has an active case of COVID-19.
While it is possible that future COVID-19 treatments that are
authorized or approved for use in the outpatient setting might be
administered to patients under observation while the provider
determines if the patient needs to be admitted to the hospital for
COVID-19, it is our expectation that this hypothetical situation would
not happen frequently. Because we believe a new COVID-19 treatment will
rarely be provided on the same claim as a primary C-APC service, we
believe new COVID-19 treatments used in the outpatient setting will be
separately paid under current policy the vast majority of the time. As
a result, we believe any budgetary effect of this new exception is
likely to be de minimis.
4. Effects of Temporary Increase in Federal Medicaid Funding
This IFC interprets the requirement in section 6008(b)(3) of the
FFCRA that states maintain Medicaid beneficiary enrollment as a
condition of receiving the temporary FMAP increase described at section
6008(a) of the FFCRA. This IFC provides states with greater flexibility
than current CMS guidance to transition beneficiaries between
eligibility groups, to modify the amount, duration, and scope of
coverage available to beneficiaries, and to make changes to applicable
cost sharing and beneficiary liability. At the same time, this IFC
protects beneficiary access to medical assistance by requiring states
to maintain each beneficiary's coverage in one of three tiers, thereby
protecting access to the basic coverage a beneficiary was receiving as
of or after March 18, 2020.
We anticipate that this IFC will result in lessened financial
burden on state Medicaid agencies and the Federal Government as
compared to CMS's existing interpretation of the FFCRA 6008(b)(3)
requirement. It would be highly challenging to estimate specific cost
savings resulting from this IFC because such an estimate would be
almost entirely dependent on state behavior under the unique
circumstances of the PHE for COVID-
[[Page 71189]]
19. First, we believe that some savings may result from transitioning
beneficiaries to different eligibility groups with greater cost sharing
or beneficiary liability. However, we know that states have faced both
system and operational constraints that may prevent them from
processing routine actions, such as transitioning a beneficiary from
one group to another following a change in circumstances. A state that
has been processing eligibility renewals and redeterminations during
the PHE may be able to make such transitions relatively quickly, while
a state that has been unable to process changes without violating the
requirements for receiving the temporary FMAP increase may need more
time to begin transferring beneficiaries between groups.
Second, we anticipate that states will implement the new
flexibilities offered by this rule in a variety of ways and to
different degrees. States may, for example, look for cost savings
through the elimination of an optional benefit, establishing new
copayments for services that are unrelated to the PHE, or increasing
beneficiary liability for institutional care through a reduction to the
personal needs allowance. Because each state's financial situation is
unique and the characteristics of each Medicaid program are different,
it is difficult to predict how states will respond to this IFC. While
one state may elect to implement just one cost saving flexibility,
another state may utilize all available options, and yet another state
may elect not to make any program changes. Based on the recent feedback
we have received from states, we do anticipate that some states will
implement some of these cost saving measures, which will result in
decreased financial burden for states and cost savings for the Federal
Government.
While our current interpretation of section 6008(b)(3) of the FFCRA
provides the strongest protections for beneficiary access to coverage,
the safeguards established by this IFC will ensure that all
beneficiaries maintain the same basic level of access to coverage that
they were receiving as of or after March 18, 2020. All beneficiaries
who had access to minimum essential coverage will maintain access to
such coverage, and every beneficiary who had access to testing services
and treatment for COVID-19, including vaccines, will retain such
access. Individual beneficiaries may be required to pay cost sharing
that they were not previously charged (except with respect to testing
and treatment services related to COVID-19, which states cannot charge
under section 6008(b)(4) of the FFCRA if they are claiming the
temporary FMAP increase), or they may need to meet additional prior
authorization or medical necessity requirements.
5. Effects of Updates to the Comprehensive Care for Joint Replacement
(CJR) Model, Performance Year (PY) 5 During the PHE
The evolving impact of the PHE for the COVID-19 has created
difficulties in forecasting the state of the LEJR market for 2021. For
example, Table 1 indicates CJR episode volume increasing and moving
back toward traditional levels from April to June, but then decreasing
again in July and August. It is difficult to predict the impact of
extending PY 5 an additional 6 months with the amended policies
described above because there exists a potential for variation between
PY 5 target prices and PY 5 actual episode costs (as a result of COVID-
19) which creates uncertainty in calculating anticipated net
reconciliation amounts for PY 5. As a result, the Office of the Actuary
was unable create projections regarding Medicare program spending in
2021 for MS-DRGs 469, 470, 521, or 522 or discrete impact estimates
regarding the effect of extending CJR PY 5 an additional 6 months with
the amended policies described above. In assessing the potential cost
or savings for this extension, CMMI internal analysis considered the
following data points. First, the Second Annual CJR Evaluation
Report,\79\ indicates participant hospitals reduced spending by 3.7
percent (difference in claims) during the first 2 years of the CJR
model. Additionally, if the episode definition policy were not amended
to include the new MS-DRGs and fracture episodes were no longer
included in the CJR episode definition October 1, 2020--March 31, 2021,
episode volume would decrease significantly and the cost saving effect
of the CJR model would be limited to only non-fracture episodes, which
are generally the less costly episodes. We also know that while the CJR
model achieves program savings, this observation is not net of
reconciliation payments and administrative costs. Further, our February
2020 proposed rule (85 FR 10516) proposes payment methodology revisions
to the target price methodology to improve payment accuracy as the
current methodology tends to excessive payment. Given the confluence of
factors affecting payments, including episode volume, actual episode
costs, and even target prices, we cannot confidently estimate cost or
savings associated with the CJR model changes in this final rule,
specifically, the provisions: to add reconciliation periods to PY 5, to
add MS-DRGs 521 and 522 to the episode definition, to change the
extreme and uncontrollable circumstances policy, and to extend PY5 6
months. We will continue to refine this analysis. If the February 2020
proposed rule is finalized after review and response to comment, we
will strive to provide a more detailed estimate for future model
performance years.
---------------------------------------------------------------------------
\79\ CMS Comprehensive Care for Joint Replacement Model:
Performance Year 2 Evaluation Report Available at https://innovation.cms.gov/files/reports/cjr-secondannrpt.pdf.
---------------------------------------------------------------------------
6. Effects of Rapid Coverage of Preventative Services for Coronavirus
This IFC requires that non-grandfathered group health plans and
health insurance issuers offering non-grandfathered group or individual
health insurance coverage provide coverage for qualifying coronavirus
preventive services, including recommended COVID-19 immunizations and
their administration, without any cost sharing. It also requires plans
and issuers to provide coverage within 15 business days after the date
on which an applicable recommendation is made by USPSTF or ACIP
relating to such a service. In addition, it requires that during the
PHE for COVID-19 a group health plan or issuer that has a network of
providers to provide coverage without cost sharing regardless of
whether the service is delivered by an in-network or out-of-network
provider. Making these qualifying coronavirus preventive services,
including COVID-19 immunizations, available without any delay is in the
interest of public health, as making these services available as
quickly as possible may encourage individuals to take advantage of
these services and therefore may slow the transmission of COVID-19.
Access to qualifying coronavirus preventive services without cost
sharing will encourage more individuals to obtain them. Increased use
of qualifying coronavirus preventive services may reduce the
transmission and spread of the disease and thus potentially result in
better overall health outcomes. In the immediate term, newly developed
qualifying coronavirus preventive services might be available from a
narrower range of providers than other, more established recommended
preventive items and services. If COVID-19 immunizations require
specialized storage and administration services, only a limited number
of
[[Page 71190]]
providers may be able to offer them at first. If consumers have to
incur additional burdens, long wait times, and increased travel times
to find an in-network provider that can provide such services, it will
limit access and discourage them from obtaining such services.
Therefore, the Departments are of the view that requiring out-of-
network coverage without cost sharing for qualifying coronavirus
preventive services will help ensure that consumers are able to obtain
the preventive services without cost sharing as soon as possible.
Plans and issuers will incur the cost of the qualifying coronavirus
preventive services and administration of such services. Providing
coverage within 15 business days after a recommendation is made
relating to such services is likely to impose significant
administrative costs on issuers, group health plans, and other service
providers to update systems to include billing codes for the preventive
services, negotiate prices with network providers, determine
reimbursements for out-of-network providers, and conduct outreach to
providers, participants, beneficiaries, and enrollees in a very short
time period. Depending on the magnitude of the costs of qualifying
coronavirus preventive services and administration of such services
relative to the potential cost of treatment for the disease, this may
have an impact on premiums. There are uncertainties regarding the price
of potential qualifying coronavirus preventive services, including
COVID-19 immunizations. If the prices are high and there is widespread
use of such services, premiums may increase. If the timing of
availability of the preventive services is such that plans and issuers
are unable to take them into account when setting premiums, it may
result in lower profits or losses for plans and issuers. The costs to
plans and issuers will be lower if a third party, such as the Federal
Government, covers the cost of the immunizations. In addition, the
costs associated with providing coverage for qualifying coronavirus
preventive services may be offset by savings from avoidance of
treatment for COVID-19.
During the PHE for COVID-19, costs to group health plans or issuers
that have networks of providers will be higher if a significant number
of participants, beneficiaries, or enrollees go to out-of-network
providers, and the issuers and plans reimburse those out-of-network
providers at higher levels than their negotiated rate with in-network
providers. However, if consumers can obtain the qualifying coronavirus
preventive services where they usually obtain health care services,
consumers are likely to receive the services from an in-network
provider. Plans and issuers may also wish to educate participants,
beneficiaries, or enrollees about the availability of the services from
in-network providers and encourage them to obtain these services from
their usual providers. This approach could limit the number of
participants, beneficiaries, or enrollees going to out-of-network
providers instead of staying in network, but there will be associated
administrative burdens and costs.
The total cost to plans and issuers related to qualifying
coronavirus preventive services that are immunizations will depend on
the cost and number of required immunization doses to be administered,
the number of people who will choose to get immunized against COVID-19
and which providers will be able to provide the preventive services.
For the 2018-19 influenza season, 62.6 percent of children 6 months
through 17 years and 45.3 percent of adults 18 years and older obtained
the influenza vaccine.\80\ Given the severity of COVID-19, the
Departments anticipate the immunization rates for COVID-19 are likely
to ultimately be higher than for influenza, although initial rates may
be lower until an adequate supply is available. Total costs to plans
and issuers will depend on the cost of covering qualifying coronavirus
preventive services, the number of people choosing to obtain such
services, and whether a third party such as the Federal Government
covers the costs of any immunizations.
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\80\ See Flu Vaccination Coverage, United States, 2018-19
Influenza Season. Center for Disease Control and Prevention,
available at https://www.cdc.gov/flu/fluvaxview/coverage-1819estimates.htm.
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The Departments seek comment on any potential costs and burdens
that may be incurred by plans and issuers due to the requirements to
cover the costs and administration of such qualifying coronavirus
preventive services without any cost sharing regardless of whether the
service is delivered by an in-network or out-of-network provider. The
Departments also seek comment on the potential effects and costs
consumers may face as a result of this provision.
7. Effects of Changes to State Innovation Waivers Policy and Regulatory
Revisions in Response to the COVID-19 Public Health Emergency
This IFC establishes a framework for states to request the
Secretary of HHS and the Secretary of the Treasury to modify, in part,
the public notice procedures outlined in 31 CFR 33.112 and 33.116 and
45 CFR 155.1312 and 155.1316 to expedite a decision on a proposed
section 1332 waiver request during the PHE for COVID-19. Regulations at
Sec. Sec. 33.112 and 155.1312 require a state to provide a public
notice and comment period at the state level prior to submitting an
application for a section 1332 waiver. The regulations at Sec. Sec.
33.116 and 155.1316 establish Federal public notice requirements for
state section 1332 waiver applications. This IFC also establishes a
framework at the new 31 CFR 33.120(c)(2) and 45 CFR 155.1320(c)(2) for
states to request the Secretaries to modify, in part, the post award
public notice procedures outlined in Sec. Sec. 33.120(c) and
155.1320(c) for an approved waiver that would otherwise take place or
become due during the PHE for COVID-19. As stated above, HHS and the
Department of the Treasury are of the view that requiring states that
meet the criteria outlined in this IFC to comply with the full public
notice procedures during the PHE for COVID-19 could cause undue harm to
the public. Allowing the Secretaries to modify, in part, these
requirements will enable states to request and receive approval for
waiver requests more quickly and also implement changes that will
provide consumers with access to affordable health insurance coverage
during the current PHE for COVID-19. States that request modifications
from the public notice procedures will incur some burden, as discussed
in the Collection of Information Requirements section. For a state that
requests and receives a modification of the public notice procedures,
we acknowledge that consumers may receive less prior notice than would
occur without the modification. Through this IFC, the HHS and the
Department of Treasury intend to provide an appropriate balance and
permit flexibility where a state can ensure a sufficient opportunity
for meaningful public input given the circumstances in the PHE for
COVID-19 while also ensuring the safety of the public. If a state's
modification request is approved there may be a shorter comment period
at the state or Federal level, or the comment periods may be the same
number of days (for example 30 days) but perhaps on a different
timeframe. For example, a state may conduct the state public comment
period concurrently with the Federal public comment period instead of
before. States with approved modification requests may experience a
reduction in costs related to post award public notice procedures.
However, if
[[Page 71191]]
the state's modification request is approved, the state must also
implement alternative public notice procedures and, if required, amend
the waiver application to specify that it is the state's intent to
comply with those alternative public notice requirements in the state's
modification request. States may also need to employ additional
technologies to host virtual hearings instead of in person gatherings.
In this case, there may be no reduction in costs related to public
notice procedures.
HHS and the Department of the Treasury seek comment on any
potential costs and burdens that may be incurred by states due to the
flexibilities afforded in this IFC. HHS and the Department of the
Treasury also seek comment on the potential effects and costs consumers
may face as a result of a state's action taken as a result of the
flexibilities in this IFC.
8. Effects of Medicare Coding and Payment for COVID-19 Vaccine
This IFC discusses CMS's implementation of section 3713 of the
CARES Act (Pub. L. 116-136), which established Medicare Part B coverage
and payment for a COVID-19 vaccine and its administration. This IFC
requires that Medicare provide coverage for qualifying COVID-19
vaccines administration, without any cost sharing. Making COVID-19
vaccines, available without any delay is in the interest of public
health, as making these services available as quickly as possible may
encourage individuals to take advantage of these services and therefore
may slow the transmission of COVID-19. Access to COVID-19 vaccines
without cost sharing will encourage more individuals to obtain them. In
the immediate term, any newly developed COVID-19 vaccines might be
available from a narrower range of providers than other, more
established recommended preventive items and services. If COVID-19
vaccines require specialized storage and administration services, only
a limited number of providers may be able to offer them at first. If
beneficiaries have to incur additional burdens, long wait times, and
increased travel times to find Medicare providers and suppliers that
can provide such services, it will limit access and discourage them
from obtaining such services. Medicare providers and suppliers will
incur costs for providing COVID-19 vaccines and administration of such
services. There are uncertainties regarding the cost to the Medicare
program for COVID-19 vaccines and administration at this time. The
total cost to Medicare related to COVID-19 vaccines and administration
cost are dependent on and the number of required immunization doses to
be administered, the number of people who will choose to get immunized
against COVID-19 and which providers and suppliers will be able to
provide the preventive services.
9. Effects of Application Fee as Part of Form CMS-855B Enrollment as
Mass Immunization Roster Biller
Consistent with Sec. 424.514, an entity enrolling in Medicare as a
mass immunization roster biller via the Form CMS-855B must pay an
application fee at the time of enrollment. The application fees for
each of the past 3 calendar years were or are $569 (CY 2018), $586, (CY
2019), and $595 (CY 2020). The differing fee amounts are predicated on
changes/increases in the Consumer Price Index (CPI) for all urban
consumers (all items; United State city average, CPI-U) for the 12-
month period ending on June 30 of the previous year. Although we cannot
predict future changes to the CPI, the fee amounts between 2018 and
2020 increased by an average of $13 per year. We believe this is a
reasonable barometer with which to establish a CY 2021 fee estimate
(strictly for purposes of this IFC) of $608.
Applying this prospective fee amount to the previously mentioned
60,000 projected mass immunization roster biller applicants in the
first year of this rule, we estimate a total application fee cost to
enrollees of $36,400,000 (or 60,000 x $608). This represents a transfer
from mass immunizer suppliers to the Federal Government.
D. Regulatory Alternatives Considered
The Department considered not implementing the changes to the CJR
model but determined the effect of the changes, particularly relief
from financial risk for COVID-19 cases and stability in model
operations, to be very important for participant hospitals during the
PHE. Further, if the three-year extension of the CJR model is
finalized, it would be much more difficult for participant hospitals to
stop model value-based operations, and then restart value operations
when hospitals already have significant burden managing COVID-19
treatment and under COVID-19 safety protocols and utilization changes.
The Departments considered not requiring plans and issuers to
provide coverage for qualifying coronavirus preventive services without
cost sharing from out-of-network providers. However, in the near term,
newly developed qualifying coronavirus preventive services might be
available from a narrower range of providers than other, more
established recommended preventive services because of specialized
storage and administration requirements. If there are only a limited
number of in-network providers that can administer these services,
consumers may incur additional burden related to travel and long wait
times to obtain these services, which can result in lower utilization.
The Departments are concerned that allowing plans and issuers to impose
cost sharing for COVID-19 immunizations provided by out-of-network
providers would discourage individuals from seeking immunization,
potentially leading to reduced administration of any COVID-19 vaccine
and prolonging the PHE for COVID-19, contrary to the intent of the
CARES Act. In order to ensure that the immunization services will be
available to all consumers enrolled in non-grandfathered group health
plans and non-grandfathered group and individual health insurance
coverage, the Departments are therefore requiring such plans and
issuers to cover without cost sharing a qualifying coronavirus
preventive service, regardless of whether such service is delivered by
an in-network or out-of-network provider. The Departments anticipate
that as such services become more widely available over time, consumers
will be able to obtain them more easily from in-network providers.
HHS and the Department of the Treasury considered providing states
with the flexibility to waive all of the public notice procedures
outlined in 31 CFR 33.112 and 33.116 and 45 CFR 155.1312 and 155.1316
to expedite a decision on a proposed section 1332 waiver request during
the PHE for COVID-19. This approach would have allowed a state to
request to completely eliminate a public notice or reporting
requirement pre- or post-award. However, HHS and the Department of the
Treasury were concerned that that this would violate the statutory
requirements regarding a meaningful level of input from the public. In
addition, HHS and the Department of Treasury are committed to
transparency and value public input on waiver proposals and value
public feedback to ensure consumers are aware of waiver proposals that
may affect them. HHS and the Department of the Treasury anticipate
working with states on their modification request to ensure the public
is provided the opportunity to provide feedback on waiver proposals and
the progress of the program authorized by the section 1332 waiver.
[[Page 71192]]
E. Regulatory Flexibility Act
The Regulatory Flexibility Act, (5 U.S.C. 601, et seq.), requires
agencies to analyze options for regulatory relief of small entities to
prepare an initial regulatory flexibility analysis to describe the
impact of the proposed rule on small entities, unless the head of the
agency can certify that the rule will not have a significant economic
impact on a substantial number of small entities. The RFA generally
defines a ``small entity'' as (1) a proprietary firm meeting the size
standards of the Small Business Administration (SBA), (2) a not-for-
profit organization that is not dominant in its field, or (3) a small
government jurisdiction with a population of less than 50,000. States
and individuals are not included in the definition of ``small entity.''
HHS uses a change in revenues of more than 3 to 5 percent as its
measure of significant economic impact on a substantial number of small
entities. For purposes of the RFA, small entities include small
businesses, nonprofit organizations, and small governmental
jurisdictions. Individuals and states are not included in the
definition of a small entity. This IFC is not preceded by a general
notice of proposed rulemaking, and thus the requirements of RFA do not
apply.
In addition, section 1102(b)(2) of the Act provides that whenever
the Secretaries promulgate a final version of a rule or regulation with
respect to which an initial regulatory impact analysis is required, the
Secretaries shall prepare a final regulatory impact analysis with
respect to the final version of such rule or regulation. Such analysis
is required to set forth, with respect to small rural hospitals, the
matters required under section 604 of title 5, United States Code, to
be set forth with respect to small entities. The Departments are not
required to prepare a final regulatory impact analysis, because this
regulatory action is being issued as an interim final rule without
being preceded by a general notice of proposed rulemaking.
F. Unfunded Mandates
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA)
requires that agencies assess anticipated costs and benefits and take
certain other actions before issuing any proposed rule or any final
rule for which a general notice of proposed rulemaking was published
that includes any Federal mandate that may result in expenditures in
any 1 year by a state, local, or Tribal governments, in the aggregate,
or by the private sector, of $100 million in 1995 dollars, updated
annually for inflation. In 2020, that threshold is approximately $156
million. This IFC was not preceded by a general notice of proposed
rulemaking, and thus the requirements of UMRA do not apply.
G. Federalism
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct requirement costs on State
and local governments, preempts State law, or otherwise has Federalism
implications. Since this rule aims to alleviate burden on State and
local governments, the requirements of Executive Order 13132 are not
applicable.
In compliance with the requirement of Executive Order 13132 that
agencies examine closely any policies that may have federalism
implications or limit the policy making discretion of the states, the
Departments have engaged in efforts to consult with and work
cooperatively with affected states, including participating in
conference calls with and attending conferences of the NAIC, and
consulting with state insurance officials on an individual basis.
While developing this rule, the Departments attempted to balance
the states' interests in regulating health insurance issuers with the
need to ensure market stability. By doing so, the Departments complied
with the requirements of Executive Order 13132.
H. Reducing Regulation and Controlling Regulatory Costs
Executive Order 13771, titled Reducing Regulation and Controlling
Regulatory Costs, was issued on January 30, 2017 and requires that the
costs associated with significant new regulations ``shall, to the
extent permitted by law, be offset by the elimination of existing costs
associated with at least two prior regulations.'' This IFC's
designation under Executive Order 13771, titled Reducing Regulation and
Controlling Regulatory Costs (82 FR 9339), which was issued on January
30, 2017, will be informed by public comments received.
List of Subjects
26 CFR Part 54
Excise taxes, Health care, Health insurance, Pensions, Reporting
and recordkeeping requirements.
29 CFR Part 2590
Employee benefit plans, Health care, Health insurance, Penalties,
Pensions, Privacy, Reporting and recordkeeping requirements.
31 CFR Part 33
Health care, Health insurance, Reporting and recordkeeping
requirements.
42 CFR Part 410
Diseases, Health facilities, Health professions, Laboratories,
Medicare, Reporting and recordkeeping requirements, Rural areas, X-
rays.
42 CFR Part 411
Diseases, Medicare, Reporting and recordkeeping requirements.
42 CFR Part 414
Administrative practice and procedure, Biologics, Diseases, Drugs,
Health facilities, Health professions, Medicare, Reporting and
recordkeeping requirements.
42 CFR Part 417
Administrative practice and procedure, Grant programs-health,
Health care, Health insurance, Health maintenance organizations (HMO),
Loan programs-health, Medicare, Reporting and recordkeeping
requirements.
42 CFR Part 433
Administrative practice and procedure, Child support, Claims, Grant
programs-health, Medicaid, Reporting and recordkeeping requirements.
42 CFR Part 510
Administrative practice and procedure, Health facilities, Medicare,
Reporting and recordkeeping requirement.
45 CFR Part 147
Age discrimination, Citizenship and naturalization, Civil rights,
Health care, Health insurance, Individuals with disabilities,
Intergovernmental relations, Reporting and recordkeeping requirements,
Sex discrimination.
45 CFR Part 155
Administrative practice and procedure, Advertising, Brokers,
Conflict of interests, Consumer protection, Grant programs-health,
Grants administration, Health care, Health insurance, Health
maintenance organizations (HMO), Health records, Hospitals, Indians,
Individuals with disabilities, Intergovernmental relations, Loan
programs-health, Medicaid, Organization and functions (Government
agencies), Public assistance programs, Reporting and recordkeeping
requirements, State flexibility, Technical assistance, Women and youth.
[[Page 71193]]
45 CFR Part 182
COVID-19 diagnostic testing, Reporting and recordkeeping
requirements.
Dated: October 21, 2020.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.
Dated: October 26, 2020.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
Sunita Lough,
Deputy Commissioner for Services and Enforcement, Internal Revenue
Service.
Approved: October 28, 2020.
David J. Kautter,
Assistant Secretary of the Treasury (Tax Policy).
Signed at Washington DC, this 29th day of October, 2020.
Jeanne Klinefelter Wilson,
Acting Assistant Secretary, Employee Benefits Security Administration,
Department of Labor.
DEPARTMENT OF THE TREASURY
Internal Revenue Service
Amendments to the Regulations
For the reasons set forth in the preamble, the Department of the
Treasury amends 26 CFR part 54 as set forth below:
PART 54--PENSION EXCISE TAXES
0
Par. 1. The authority citation for part 54 continues to read in part as
follows:
Authority: 26 U.S.C. 7805, unless otherwise noted.
* * * * *
Section 54.9815-2713T also issued under 26 U.S.C. 9833.
* * * * *
0
2. Section 54.9815-2713T is added to read as follows:
Sec. 54.9815-2713T Coverage of preventive health services
(temporary).
(a) Services--(1) In general. Beginning at the time described in
paragraph (b) of this section and subject to Sec. 54.9815-2713A, a
group health plan, or a health insurance issuer offering group health
insurance coverage, must provide coverage for and must not impose any
cost-sharing requirements (such as a copayment, coinsurance, or a
deductible) for--
(i) Evidence-based items or services that have in effect a rating
of A or B in the current recommendations of the United States
Preventive Services Task Force with respect to the individual involved
(except as otherwise provided in paragraph (c) of this section);
(ii) Immunizations for routine use in children, adolescents, and
adults that have in effect a recommendation from the Advisory Committee
on Immunization Practices of the Centers for Disease Control and
Prevention with respect to the individual involved (for purposes of
this paragraph (a)(1)(ii), a recommendation from the Advisory Committee
on Immunization Practices of the Centers for Disease Control and
Prevention is considered in effect after it has been adopted by the
Director of the Centers for Disease Control and Prevention, and a
recommendation is considered to be for routine use if it is listed on
the Immunization Schedules of the Centers for Disease Control and
Prevention);
(iii) With respect to infants, children, and adolescents, evidence-
informed preventive care and screenings provided for in comprehensive
guidelines supported by the Health Resources and Services
Administration;
(iv) With respect to women, such additional preventive care and
screenings not described in paragraph (a)(1)(i) of this section as
provided for in comprehensive guidelines supported by the Health
Resources and Services Administration for purposes of section
2713(a)(4) of the Public Health Service Act, subject to 45 CFR 147.131,
147.132, and 147.133; and
(v) Any qualifying coronavirus preventive service, which means an
item, service, or immunization that is intended to prevent or mitigate
coronavirus disease 2019 (COVID-19) and that is, with respect to the
individual involved--
(A) An evidence-based item or service that has in effect a rating
of A or B in the current recommendations of the United States
Preventive Services Task Force; or
(B) An immunization that has in effect a recommendation from the
Advisory Committee on Immunization Practices of the Centers for Disease
Control and Prevention (regardless of whether the immunization is
recommended for routine use). For purposes of this paragraph
(a)(1)(v)(B), a recommendation from the Advisory Committee on
Immunization Practices of the Centers for Disease Control and
Prevention is considered in effect after it has been adopted by the
Director of the Centers for Disease Control and Prevention.
(2) Office visits. (i) If an item or service described in paragraph
(a)(1) of this section is billed separately (or is tracked as
individual encounter data separately) from an office visit, then a plan
or issuer may impose cost-sharing requirements with respect to the
office visit.
(ii) If an item or service described in paragraph (a)(1) of this
section is not billed separately (or is not tracked as individual
encounter data separately) from an office visit and the primary purpose
of the office visit is the delivery of such an item or service, then a
plan or issuer may not impose cost-sharing requirements with respect to
the office visit.
(iii) If an item or service described in paragraph (a)(1) of this
section is not billed separately (or is not tracked as individual
encounter data separately) from an office visit and the primary purpose
of the office visit is not the delivery of such an item or service,
then a plan or issuer may impose cost-sharing requirements with respect
to the office visit.
(iv) The rules of this paragraph (a)(2) are illustrated by the
following examples:
(A) Example 1--(1) Facts. An individual covered by a group health
plan visits an in-network health care provider. While visiting the
provider, the individual is screened for cholesterol abnormalities,
which has in effect a rating of A or B in the current recommendations
of the United States Preventive Services Task Force with respect to the
individual. The provider bills the plan for an office visit and for the
laboratory work of the cholesterol screening test.
(2) Conclusion. In paragraph (a)(2)(iv)(A)(1) of this section, the
plan may not impose any cost-sharing requirements with respect to the
separately-billed laboratory work of the cholesterol screening test.
Because the office visit is billed separately from the cholesterol
screening test, the plan may impose cost-sharing requirements for the
office visit.
(B) Example 2--(1) Facts. Same facts as in paragraph
(a)(2)(iv)(A)(1) of this section (Example 1). As the result of the
screening, the individual is diagnosed with hyperlipidemia and is
prescribed a course of treatment that is not included in the
recommendations under paragraph (a)(1) of this section.
(2) Conclusion. In paragraph (a)(2)(iv)(B)(1) of this section,
because the treatment is not included in the recommendations under
paragraph (a)(1) of this section, the plan is not prohibited from
imposing cost-sharing requirements with respect to the treatment.
(C) Example 3--(1) Facts. An individual covered by a group health
plan visits an in-network health care provider to discuss recurring
abdominal pain. During the visit, the individual
[[Page 71194]]
has a blood pressure screening, which has in effect a rating of A or B
in the current recommendations of the United States Preventive Services
Task Force with respect to the individual. The provider bills the plan
for an office visit.
(2) Conclusion. In paragraph (a)(2)(iv)(C)(1) of this section, the
blood pressure screening is provided as part of an office visit for
which the primary purpose was not to deliver items or services
described in paragraph (a)(1) of this section. Therefore, the plan may
impose a cost-sharing requirement for the office visit charge.
(D) Example 4--(1) Facts. A child covered by a group health plan
visits an in-network pediatrician to receive an annual physical exam
described as part of the comprehensive guidelines supported by the
Health Resources and Services Administration. During the office visit,
the child receives additional items and services that are not described
in the comprehensive guidelines supported by the Health Resources and
Services Administration, nor otherwise described in paragraph (a)(1) of
this section. The provider bills the plan for an office visit.
(2) Conclusion. In paragraph (a)(2)(iv)(D)(1) of this section, the
service was not billed as a separate charge and was billed as part of
an office visit. Moreover, the primary purpose for the visit was to
deliver items and services described as part of the comprehensive
guidelines supported by the Health Resources and Services
Administration. Therefore, the plan may not impose a cost-sharing
requirement with respect to the office visit.
(3) Out-of-network providers. (i) Subject to paragraphs (a)(3)(ii)
and (iii) of this section, nothing in this section requires a plan or
issuer that has a network of providers to provide benefits for items or
services described in paragraph (a)(1) of this section that are
delivered by an out-of-network provider, or precludes a plan or issuer
that has a network of providers from imposing cost-sharing requirements
for items or services described in paragraph (a)(1) of this section
that are delivered by an out-of-network provider.
(ii) If a plan or issuer does not have in its network a provider
who can provide an item or service described in paragraph (a)(1) of
this section, the plan or issuer must cover the item or service when
performed by an out-of-network provider, and may not impose cost-
sharing with respect to the item or service.
(iii) A plan or issuer must provide coverage for and must not
impose any cost-sharing requirements (such as a copayment, coinsurance,
or a deductible) for any qualifying coronavirus preventive service
described in paragraph (a)(1)(v) of this section, regardless of whether
such service is delivered by an in-network or out-of-network provider.
For purposes of this paragraph (a)(3)(iii), with respect to a
qualifying coronavirus preventive service and a provider with whom the
plan or issuer does not have a negotiated rate for such service (such
as an out-of-network provider), the plan or issuer must reimburse the
provider for such service in an amount that is reasonable, as
determined in comparison to prevailing market rates for such service.
(4) Reasonable medical management. Nothing prevents a plan or
issuer from using reasonable medical management techniques to determine
the frequency, method, treatment, or setting for an item or service
described in paragraph (a)(1) of this section to the extent not
specified in the relevant recommendation or guideline. To the extent
not specified in a recommendation or guideline, a plan or issuer may
rely on the relevant clinical evidence base and established reasonable
medical management techniques to determine the frequency, method,
treatment, or setting for coverage of a recommended preventive health
service.
(5) Services not described. Nothing in this section prohibits a
plan or issuer from providing coverage for items and services in
addition to those recommended by the United States Preventive Services
Task Force or the Advisory Committee on Immunization Practices of the
Centers for Disease Control and Prevention, or provided for by
guidelines supported by the Health Resources and Services
Administration, or from denying coverage for items and services that
are not recommended by that task force or that advisory committee, or
under those guidelines. A plan or issuer may impose cost-sharing
requirements for a treatment not described in paragraph (a)(1) of this
section, even if the treatment results from an item or service
described in paragraph (a)(1) of this section.
(b) Timing--(1) In general. A plan or issuer must provide coverage
pursuant to paragraph (a)(1) of this section for plan years that begin
on or after September 23, 2010, or, if later, for plan years that begin
on or after the date that is one year after the date the recommendation
or guideline is issued, except as provided in paragraph (b)(3) of this
section.
(2) Changes in recommendations or guidelines. (i) A plan or issuer
that is required to provide coverage for any items and services
specified in any recommendation or guideline described in paragraph
(a)(1) of this section on the first day of a plan year, or as otherwise
provided in paragraph (b)(3) of this section, must provide coverage
through the last day of the plan or policy year, even if the
recommendation or guideline changes or is no longer described in
paragraph (a)(1) of this section, during the applicable plan or policy
year.
(ii) Notwithstanding paragraph (b)(2)(i) of this section, to the
extent a recommendation or guideline described in paragraph (a)(1)(i)
of this section that was in effect on the first day of a plan year, or
as otherwise provided in paragraph (b)(3) of this section, is
downgraded to a ``D'' rating, or any item or service associated with
any recommendation or guideline specified in paragraph (a)(1) of this
section is subject to a safety recall or is otherwise determined to
pose a significant safety concern by a Federal agency authorized to
regulate the item or service during a plan or policy year, there is no
requirement under this section to cover these items and services
through the last day of the applicable plan or policy year.
(3) Rapid coverage of preventive services for coronavirus. In the
case of a qualifying coronavirus preventive service described in
paragraph (a)(1)(v) of this section, a plan or issuer must provide
coverage for such item, service, or immunization in accordance with
this section by the date that is 15 business days after the date on
which a recommendation specified in paragraph (a)(1)(v)(A) or (B) of
this section is made relating to such item, service, or immunization.
(c) Recommendations not current. For purposes of paragraph
(a)(1)(i) of this section, and for purposes of any other provision of
law, recommendations of the United States Preventive Services Task
Force regarding breast cancer screening, mammography, and prevention
issued in or around November 2009 are not considered to be current.
(d) Applicability date. The provisions of paragraphs (a)(1)(i)
through (iv), (a)(2), (a)(3)(i) and (ii), (a)(4) through (5), (b)(1)
and (2), and (c) of this section are applicable as of April 16, 2012.
(e) Sunset date. The provisions of paragraphs (a)(1)(v),
(a)(3)(iii), and (b)(3) of this section will not apply with respect to
a qualifying coronavirus preventive service furnished on or after the
expiration of the public health emergency determined on January 31,
2020, to exist nationwide as of January 27, 2020, by the Secretary of
Health and
[[Page 71195]]
Human Services pursuant to section 319 of the Public Health Service
Act, as a result of COVID-19, including any subsequent renewals of that
determination.
DEPARTMENT OF LABOR
Employee Benefits Security Administration
For the reasons set forth in the preamble, the Department of Labor
amends 29 CFR part 2590 as set forth below:
PART 2590--RULES AND REGULATIONS FOR GROUP HEALTH PLANS
0
3. The authority citation for part 2590 continues to read as follows:
Authority: 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-
1183, 1181 note, 1185, 1185a, 1185b, 1191, 1191a, 1191b, and 1191c;
sec. 101(g), Pub. L. 104-191, 110 Stat. 1936; sec. 401(b), Pub. L.
105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L.
110-343, 122 Stat. 3881; sec. 1001, 1201, and 1562(e), Pub. L. 111-
148, 124 Stat. 119, as amended by Pub. L. 111-152, 124 Stat. 1029;
Division M, Pub. L. 113-235, 128 Stat. 2130; Secretary of Labor's
Order 1-2011, 77 FR 1088 (Jan. 9, 2012).
0
4. Section 2590.715-2713 is amended--
0
a. In paragraph (a)(1)(iii) by removing ``and'' after the semicolon;
0
b. In paragraph (a)(1)(iv) by removing the period at the end of the
paragraph and adding ``; and'' in its place;
0
c. By adding paragraph (a)(1)(v);
0
d. By revising paragraph (a)(3)(i);
0
e. By adding paragraph (a)(3)(iii);
0
f. By revising paragraphs (b)(1) and (b)(2)(i) and (ii); and
0
g. By adding paragraphs (b)(3) and (e).
The revisions and additions read as follows:
Sec. 2590.715-2713 Coverage of preventive health services.
(a) * * *
(1) * * *
(v) Any qualifying coronavirus preventive service, which means an
item, service, or immunization that is intended to prevent or mitigate
coronavirus disease 2019 (COVID-19) and that is, with respect to the
individual involved--
(A) An evidence-based item or service that has in effect a rating
of A or B in the current recommendations of the United States
Preventive Services Task Force; or
(B) An immunization that has in effect a recommendation from the
Advisory Committee on Immunization Practices of the Centers for Disease
Control and Prevention (regardless of whether the immunization is
recommended for routine use). For purposes of this paragraph
(a)(1)(v)(B), a recommendation from the Advisory Committee on
Immunization Practices of the Centers for Disease Control and
Prevention is considered in effect after it has been adopted by the
Director of the Centers for Disease Control and Prevention.
* * * * *
(3) * * *
(i) Subject to paragraphs (a)(3)(ii) and (iii) of this section,
nothing in this section requires a plan or issuer that has a network of
providers to provide benefits for items or services described in
paragraph (a)(1) of this section that are delivered by an out-of-
network provider, or precludes a plan or issuer that has a network of
providers from imposing cost-sharing requirements for items or services
described in paragraph (a)(1) of this section that are delivered by an
out-of-network provider.
* * * * *
(iii) A plan or issuer must provide coverage for and must not
impose any cost-sharing requirements (such as a copayment, coinsurance,
or a deductible) for any qualifying coronavirus preventive service
described in paragraph (a)(1)(v) of this section, regardless of whether
such service is delivered by an in-network or out-of-network provider.
For purposes of this paragraph (a)(3)(iii), with respect to a
qualifying coronavirus preventive service and a provider with whom the
plan or issuer does not have a negotiated rate for such service (such
as an out-of-network provider), the plan or issuer must reimburse the
provider for such service in an amount that is reasonable, as
determined in comparison to prevailing market rates for such service.
* * * * *
(b) * * *
(1) In general. A plan or issuer must provide coverage pursuant to
paragraph (a)(1) of this section for plan years that begin on or after
September 23, 2010, or, if later, for plan years that begin on or after
the date that is one year after the date the recommendation or
guideline is issued, except as provided in paragraph (b)(3) of this
section.
(2) * * *
(i) A plan or issuer that is required to provide coverage for any
items and services specified in any recommendation or guideline
described in paragraph (a)(1) of this section on the first day of a
plan year, or as otherwise provided in paragraph (b)(3) of this
section, must provide coverage through the last day of the plan or
policy year, even if the recommendation or guideline changes or is no
longer described in paragraph (a)(1) of this section, during the
applicable plan or policy year.
(ii) Notwithstanding paragraph (b)(2)(i) of this section, to the
extent a recommendation or guideline described in paragraph (a)(1)(i)
of this section that was in effect on the first day of a plan year, or
as otherwise provided in paragraph (b)(3) of this section, is
downgraded to a ``D'' rating, or any item or service associated with
any recommendation or guideline specified in paragraph (a)(1) of this
section is subject to a safety recall or is otherwise determined to
pose a significant safety concern by a Federal agency authorized to
regulate the item or service during a plan or policy year, there is no
requirement under this section to cover these items and services
through the last day of the applicable plan or policy year.
(3) Rapid coverage of preventive services for coronavirus. In the
case of a qualifying coronavirus preventive service described in
paragraph (a)(1)(v) of this section, a plan or issuer must provide
coverage for such item, service, or immunization in accordance with
this section by the date that is 15 business days after the date on
which a recommendation specified in paragraph (a)(1)(v)(A) or (B) of
this section is made relating to such item, service, or immunization.
* * * * *
(e) Sunset date. The provisions of paragraphs (a)(1)(v),
(a)(3)(iii), and (b)(3) of this section will not apply with respect to
a qualifying coronavirus preventive service furnished on or after the
expiration of the public health emergency determined on January 31,
2020, to exist nationwide as of January 27, 2020, by the Secretary of
Health and Human Services pursuant to section 319 of the Public Health
Service Act, as a result of COVID-19, including any subsequent renewals
of that determination.
DEPARTMENT OF THE TREASURY
Office of the Secretary
Amendments to the Regulations
For the reasons set forth in the preamble, the Department of
Treasury amends 31 CFR part 33 as set forth below:
PART 33--WAIVERS FOR STATE INNOVATION
0
5. The authority citation for part 33 continues to read as follows:
[[Page 71196]]
Authority: Sec. 1332, Pub. L. 111-148, 124 Stat. 119.
0
6. Section 33.118 is added to read as follows:
Sec. 33.118 Modification from the normal public notice requirements
during the public health emergency.
(a) The Secretary and the Secretary of Health and Human Services
may modify, in part, the State public notice requirements under Sec.
33.112 and the Federal public notice procedures under Sec. 33.116 to
expedite a decision on a proposed waiver request during the public
health emergency for COVID-19, as defined in 42 CFR 400.200, when a
delay would undermine or compromise the purpose of the proposed waiver
request and be contrary to the interests of consumers. These
flexibilities are limited to event-triggered, emergent situations, and
the flexibilities outlined in this section will not be available for
States seeking to address a threat to consumers' access to health
coverage or care that existed prior to the public health emergency for
COVID-19.
(b) A State must meet all of the following criteria to request a
modification under paragraph (a) of this section:
(1) The State must request a modification under paragraph (a) of
this section, in the form and manner specified by the Secretaries.
(2) The State must have acted in good faith, and in a diligent,
timely, and prudent manner in the preparation of the request for a
modification under paragraph (a) of this section, and the waiver
application request, as applicable.
(3) The State must, as applicable, detail in its request for a
modification from State-level notice procedures under paragraph (a) of
this section the justification for the request and the alternative
public notice procedures it proposes to implement at the State level,
including public hearings, that are designed to provide the greatest
opportunity and level of meaningful public input from impacted
stakeholders that is practicable given the emergency circumstances
underlying the State's request for a modification. As a condition of
receiving a modification approval, a State must implement public notice
procedures, including public hearings, at the State level and, if
required, amend the waiver application request.
(4) The State must, as applicable, detail in its request for a
modification from Federal-level notice procedures under paragraph (a)
of this section the justification for the request as it relates to the
public health emergency and the alternative public notice procedures it
requests to be implemented at the Federal level.
(c) The Secretary and the Secretary of Health and Human Services
will evaluate a State's request for a modification under paragraph (a)
of this section and issue their exemption determination within
approximately 15 calendar days after the request is received.
(d) The Secretary of Health and Human Services will publish on the
Centers for Medicare and Medicaid Services (CMS) website any
modification determinations within 15 calendar days of the Secretary
and the Secretary of Health and Human Services making such a
determination, as well as the approved revised timeline for public
comment under the approved alternative State or Federal public notice
procedures, as applicable.
(e) The State must publish on its website any modification requests
and determinations within 15 calendar days of receipt of the
determination, as well as the approved revised timeline for public
comment under the alternative State or Federal public notice
procedures, as applicable.
(f) The State must, as applicable, implement the alternative public
notice procedures at the State level if the State's exemption request
is approved and, if required, amend the waiver application request.
0
7. Section 33.120 is amended--
0
a. In paragraph (c)(1) by adding a paragraph heading; and
0
b. By adding paragraph (c)(2).
The additions read as follows:
Sec. 33.120 Monitoring and compliance.
* * * * *
(c) * * *
(1) Notification requirements for public forum. * * *
(2) Modification from the normal post-award requirements during the
public health emergency. (i) The Secretary and the Secretary of Health
and Human Services may modify, in part, State post-award requirements
under this paragraph (c)(2) for an approved waiver request during the
public health emergency for COVID-19, as defined in 42 CFR 400.200,
when the application of the post award public notice requirements would
be contrary to the interests of consumers during the public health
emergency. These flexibilities are limited to event-triggered, emergent
situations, and the flexibilities outlined in this section will not be
available for States seeking to address a threat to consumers' access
to health coverage or care that existed prior to the public health
emergency for COVID-19.
(ii) A State must meet all of the following criteria to request a
modification under paragraph (c) of this section:
(A) The State must request a modification under this paragraph
(c)(2), in the form and manner specified by the Secretaries.
(B) The State must have acted in good faith, and in a diligent,
timely, and prudent manner to comply with the monitoring and compliance
requirement under the waiver and the terms and conditions of the
agreement between the Secretary and the Secretary of Health and Human
Services, as applicable, and the State to implement a section 1332
waiver and to submit and prepare the request for a modification under
this paragraph (c)(2).
(C) The State must detail in its request for a modification under
this paragraph (c)(2) the alternative post award public notice
procedures it proposes to implement at the State level, including
public hearings, that are designed to provide the greatest opportunity
and level of meaningful public input from impacted stakeholders that is
practicable given the emergency circumstances underlying the State's
request for a modification.
(D) The Secretary and the Secretary of Health and Human Services
will evaluate a State's request for a modification under this paragraph
(c)(2) and issue their modification determination within approximately
15 calendar days after the request is received.
(E) The State must publish on its website any modification requests
and determinations within 15 calendar days of the receipt of the
determination as well as information on the approved revised timeline
for the state's post award public notice procedures, as applicable.
* * * * *
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
For the reasons stated in the preamble, the Centers for Medicare &
Medicaid Services amends 42 CFR chapter IV as set forth below:
PART 410--SUPPLEMENTARY MEDICAL INSURANCE (SMI) BENEFITS
0
8. The authority citation part 414 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395m, 1395hh, 1395rr, and 1395ddd.
[[Page 71197]]
0
9. Section 410.57 is amended by adding paragraph (c) to read as
follows:
Sec. 410.57 Pneumococcal vaccine, flu vaccine, and COVID-19 vaccine.
* * * * *
(c) Medicare Part B pays for the COVID-19 vaccine and its
administration.
0
10. Section 410.152 is amended by revising paragraph (l)(1) to read as
follows:
Sec. 410.152 Amounts of payment.
* * * * *
(l) * * *
(1) Pneumococcal (as specified in paragraph (h) of this section),
influenza, hepatitis B, and COVID-19 vaccine and administration.
* * * * *
0
11. Section 410.160 is amended by revising paragraph (b)(2) to read as
follows:
Sec. 410.160 Part B annual deductible.
* * * * *
(b) * * *
(2) Pneumococcal, influenza, and hepatitis b, and COVID-19 vaccines
and their administration.
* * * * *
PART 411--EXCLUSIONS FROM MEDICARE AND LIMITATIONS ON MEDICARE
PAYMENT
0
12. The authority citation part 411 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395w-101 through 1395w-152, 1395hh,
and 1395nn.
0
13. Section 411.15 is amended by:
0
a. Removing ``and'' at the end of paragraph (e)(3);
0
b. Removing the period at the end of paragraph (e)(4) and adding ``;
and'' in its place; and
0
c. Adding paragraph (e)(5).
The addition reads as follows:
Sec. 411.15 Particular services excluded from coverage.
* * * * *
(e) * * *
(5) COVID-19 vaccinations that are reasonable and necessary for the
prevention of illness.
* * * * *
PART 414--PAYMENT FOR PART B MEDICAL AND OTHER HEALTH SERVICES
0
14. The authority citation part 414 continues to read as follows:
Authority: 42 U.S.C. 1302, 1395hh, and 1395rr(b)(l).
0
15. Section 414.701 is revised to read as follows:
Sec. 414.701 Purpose.
This subpart implements section 1842(o) of the Act by specifying
the methodology for determining the payment allowance limit for drugs
and biologicals covered under Part B of Title XVIII of the Act
(hereafter in this subpart referred to as the ``program'') that are not
paid on a cost or prospective payment system basis. Examples of drugs
that are subject to the rules contained in this subpart are: Drugs
furnished incident to a physician's service; durable medical equipment
(DME) drugs; separately billable drugs at independent dialysis
facilities not under the ESRD composite rate; statutorily covered
drugs, for example, influenza, pneumococcal, hepatitis, and COVID-19
vaccines, antigens, hemophilia blood clotting factor, immunosuppressive
drugs and certain oral anti-cancer drugs.
0
16. Section 414.707 is amended by revising paragraph (a)(2)(iii) to
read as follows:
Sec. 414.707 Basis of payment.
(a) * * *
(2) * * *
(iii) Pneumococcal, influenza, and COVID-19 vaccines as well as
hepatitis B vaccine that is furnished to individuals at high or
intermediate risk of contracting hepatitis B (as determined by the
Secretary).
* * * * *
0
17. Section 414.900 is amended by revising paragraph (b)(3)(ii) to read
as follows:
Sec. 414.900 Basis and scope.
* * * * *
(b) * * *
(3) * * *
(ii) Pneumococcal, Hepatitis B, and COVID-19 vaccines.
* * * * *
0
18. Section 414.904 is amended by revising paragraph (e)(1) to read as
follows:
Sec. 414.904 Average sales price as the basis for payment.
* * * * *
(e) * * *
(1) Vaccines. The payment limits for hepatitis B vaccine furnished
to individuals at high or intermediate risk of contracting hepatitis B
(as determined by the Secretary), pneumococcal vaccine, influenza
vaccine, and COVID-19 vaccine are calculated using 95 percent of the
average wholesale price.
* * * * *
PART 417--HEALTH MAINTENANCE ORGANIZATIONS, COMPETITIVE MEDICAL
PLANS, AND HEALTH CARE PREPAYMENT PLANS
0
19. The authority citation for part 417 is revised to read as follows:
Authority: 42 U.S.C. 1302 and 1395hh, and 300e, 300e-5, and
300e-9, and 31 U.S.C. 9701.
0
20. Section 417.454 is amended by adding paragraph (e)(4) to read as
follows:
Sec. 417.454 Charges to Medicare enrollees.
* * * * *
(e) * * *
(4) A COVID-19 vaccine and its administration described in section
1861(s)(10)(A) for the duration of the emergency period defined in
paragraph (1)(B) of section 1135(g) of the Act.
PART 433--STATE FISCAL ADMINISTRATION
0
21. The authority citation for part 433 continues to read as follows:
Authority: Sec. 1102 of the Social Security Act, (42 U.S.C.
1302).
0
22. Subpart G, consisting of Sec. 433.400, is added to read as
follows:
Subpart G--Temporary FMAP Increase During the Public Health
Emergency for COVID-19
Sec. 433.400 Continued Enrollment for Temporary FMAP Increase.
(a) Statutory basis. This subpart interprets and implements section
6008(b)(3) of the Families First Coronavirus Response Act (FFCRA) and
section 1902(a)(4) and (a)(19) of the Social Security Act.
(b) Definitions. For purposes of this subpart--
COVID-19 means Coronavirus Disease 2019.
Medicare Savings Program means the coverage of Medicare premiums
and cost sharing furnished to individuals described in, and determined
by the state to be eligible under, section 1902(a)(10)(E)(i),
1902(a)(10)(E)(iii), or 1902(a)(10)(E)(iv) of the Act.
Minimum essential coverage (MEC) has the meaning provided under
section 5000A(f)(1) of the Internal Revenue Code and implementing
regulations at 26 CFR 1.5000A-2 and includes minimum essential coverage
determined by the Secretary under 26 CFR 1.5000A-2(f).
Public Health Emergency for COVID-19 has the same definition
provided in Sec. 400.200 of this chapter.
Temporary FMAP increase means the 6.2 percentage point increase in
the
[[Page 71198]]
State's Federal medical assistance percentage (FMAP) that is authorized
under section 6008(a) of the FFCRA through the end of the fiscal
quarter in which the Public Health Emergency for COVID-19 ends.
Validly enrolled means that the beneficiary was enrolled in
Medicaid based on a determination of eligibility. A beneficiary is not
validly enrolled if the agency determines the eligibility was
erroneously granted at the most recent determination, redetermination,
or renewal of eligibility (if such last redetermination or renewal was
completed prior to March 18, 2020) because of agency error or fraud (as
evidenced by a fraud conviction) or abuse (as determined following the
completion of an investigation pursuant to Sec. Sec. 455.15 and 455.16
of this chapter) attributed to the beneficiary or the beneficiary's
representative, which was material to the determination of eligibility.
Individuals receiving medical assistance during a presumptive
eligibility period in accordance with part 435, subpart L, of this
chapter have not received a determination of eligibility by the state
under the state plan and are not considered validly enrolled
beneficiaries for purposes of this section.
(c) General requirements. (1) In order to claim the temporary FMAP
increase for:
(i) The quarter in which November 2, 2020, falls, a state must meet
the requirements described in paragraph (c)(2) of this section from
November 2, 2020, through the end of the quarter.
(ii) Any quarter beginning after November 2, 2020, through the
quarter in which the public health emergency for COVID-19, including
any extensions, ends, a state must meet the requirements described in
paragraphs (c)(2) of this section.
(2) Except as provided in paragraph (d) of this section, for all
beneficiaries validly enrolled for benefits under the state plan, a
waiver of such plan, or a demonstration project under section 1115(a)
of the Act as of or after March 18, 2020, the state must maintain the
beneficiary's enrollment as follows, through the end of the month in
which the public health emergency for COVID-19 ends:
(i)(A) For beneficiaries whose Medicaid coverage meets the
definition of MEC in paragraph (b) of this section as of or after March
18, 2020, the state must continue to provide Medicaid coverage that
meets the definition of MEC, except as provided in paragraph
(c)(2)(i)(B) of this section.
(B) For beneficiaries described in paragraph (c)(2)(i)(A) whom the
state subsequently determines are eligible for coverage under a
Medicare Savings Program eligibility group, the state satisfies the
requirement described in paragraph (c)(2) of this section if it
furnishes the medical assistance available through the Medicare Savings
Program.
(ii) For beneficiaries whose Medicaid coverage as of or after March
18, 2020 does not meet the definition of MEC in paragraph (b) of this
section but does include coverage for testing services and treatments
for COVID-19, including vaccines, specialized equipment, and therapies,
the state must continue to provide Medicaid coverage that includes such
testing services and treatments.
(iii) For beneficiaries not described in paragraph (c)(2)(i) or
(ii) of this section, the state must continue to provide at least the
same level of medical assistance as was provided as of or after March
18, 2020.
(iv) If a state determines that a validly enrolled beneficiary is
no longer eligible for Medicaid, including on a procedural basis, the
state meets the requirements described in paragraph (c)(2)(i), (ii), or
(iii) of this section by continuing to provide the same Medicaid
coverage that the beneficiary would have received absent the
determination of ineligibility.
(3) Otherwise permissible changes to beneficiary coverage, cost
sharing, and post-eligibility treatment of income, including both
changes affecting an individual beneficiary and approved changes to the
state plan, a section 1115 demonstration and/or a waiver authorized
under section 1915 of the Act impacting multiple beneficiaries, will
not impact a state's ability to claim the temporary FMAP increase
provided that any such changes do not violate the requirement to
maintain beneficiary enrollment described at paragraph (c)(2) of this
section or the requirement in section 6008(b)(4) of the FFCRA.
(d) Exceptions. (1) Consistent with the condition to claim the
temporary FMAP increase described in paragraph (c)(2) of this section,
a state may terminate a beneficiary's Medicaid enrollment prior to the
first day of the month after the public health emergency for COVID-19
ends in the following circumstances:
(i) The beneficiary or the beneficiary's representative requests a
voluntary termination of eligibility;
(ii) The beneficiary ceases to be a resident of the state; or
(iii) The beneficiary dies.
(2) States which have elected the option under section 1903(v)(4)
of the Act to provide full benefits to lawfully residing children or
pregnant women must limit coverage for such beneficiaries if they no
longer meet the definition of a lawfully residing child or pregnant
woman under such section to services necessary for treatment of an
emergency medical condition, as defined in section 1903(v)(3) of the
Act.
(3)(i) For purposes of paragraph (d)(1)(i) of this section, a
beneficiary may request a voluntary termination of eligibility from the
Medicaid coverage in which the beneficiary is enrolled to transition to
other Medicaid coverage for which the beneficiary is eligible, even if
the transition to the new Medicaid coverage would not be consistent
with paragraph (c)(2) of this section.
(ii) For purposes of paragraph (d)(1)(ii) of this section,
beneficiaries who were identified through a data match with the Public
Assistance Reporting Information System in accordance with Sec.
435.945(d) of this chapter indicating simultaneous enrollment in two or
more states, and who fail to respond to a request for information to
verify their residency, may be treated as not being a state resident
for purposes of paragraph (d)(1)(ii) of this section, provided that the
state takes all reasonably available measures to attempt to verify the
beneficiary's state residency. If a beneficiary's enrollment is
terminated under the exception at paragraph (d)(1)(ii) of this section
based on a PARIS data match and the state subsequently obtains
information verifying residency, the state must reinstate the
beneficiary's Medicaid enrollment retroactive to the date of
termination.
PART 510--COMPREHENSIVE CARE FOR JOINT REPLACEMENT MODEL
0
23. The authority citation for part 510 is revised to read as follows:
Authority: 42 U.S.C. 1302, 1315(a), and 1395hh.
0
24. Section 510.2 is amended by--
0
a. Adding a definition for ``COVID-19 Diagnosis Code'' in alphabetical
order; and
0
b. Revising the definitions for ``Lower-extremity joint replacement
(LEJR)'', ``Performance year'', and ``Quality improvement points''.
The addition and revisions read as follows:
Sec. 510.2 Definitions.
* * * * *
COVID-19 Diagnosis Code means any of the following ICD-10-CM
diagnosis codes:
[[Page 71199]]
(1) B97.29;
(2) U07.1; or
(3) Any other ICD-10-CM diagnosis code that is recommended by the
Centers for Disease Control and Prevention for the coding of a
confirmed case of COVID-19.
* * * * *
Lower-extremity joint replacement (LEJR) means any procedure that
is within MS-DRG 469 or 470, or, on or after October 1, 2020, MS-DRG
521 or 522, including lower-extremity joint replacement procedures or
reattachment of a lower extremity.
* * * * *
Performance year means one of the years in which the CJR model is
being tested. Performance years for the model correlate to calendar
years with the exceptions of performance year 1, which is April 1, 2016
through December 31, 2016 and performance year 5, which is January 1,
2020 through September 30, 2021. For reconciliation purposes,
performance year 5 is divided into two subsets, performance year subset
5.1 (January 1, 2020 through December 31, 2020) and performance year
subset 5.2 (January 1, 2021 through September 30, 2021).
* * * * *
Quality improvement points are points that CMS adds to a
participant hospital's composite quality score for a measure if the
hospital's performance percentile on an individual quality measure for
performance years 2 through 4 and for performance year subsets 5.1 and
5.2, increases from the previous performance year or performance year
subset by at least 2 deciles on the performance percentile scale, as
described in Sec. 510.315(d). For performance year 1, CMS adds quality
improvement points to a participant hospital's composite quality score
for a measure if the hospital's performance percentile on an individual
quality measure increases from the corresponding time period in the
previous year by at least 2 deciles on the performance percentile
scale, as described in Sec. 510.315(d).
* * * * *
0
25. Section 510.200 is amended by revising paragraphs (a) and (d)(6) to
read as follows:
Sec. 510.200 Time periods, included and excluded services, and
attribution.
(a) Time periods. All episodes must begin on or after April 1, 2016
and end on or before September 30, 2021.
* * * * *
(d) * * *
(6) For performance years 1 through 4 and for performance year
subsets 5.1 and 5.2, payments for otherwise included items and services
in excess of 2 standard deviations above the mean regional episode
payment in accordance with Sec. 510.300(b)(5).
* * * * *
0
26. Section 510.300 is amended by revising paragraphs (a) introductory
text, (a)(1)(i), (a)(1)(iii), (a)(2) and (3), (b)(1)(iii), (b)(2)(iii),
(b)(8), (c)(1) and (2), and (c)(3)(iii) to read as follows:
Sec. 510.300 Determination of episode quality-adjusted target prices.
(a) General. CMS establishes episode quality-adjusted target prices
for participant hospitals for each performance year or performance year
subset of the model as specified in this section. Episode quality-
adjusted target prices are established according to the following:
(1) * * *
(i)(A) MS-DRG 469 with hip fracture; or
(B) For episodes beginning on or after October 1, 2020, MS-DRG 521;
* * * * *
(iii)(A) MS-DRG 470 with hip fracture; or
(B) For episodes beginning on or after October 1, 2020, MS-DRG 522;
or
* * * * *
(2) Applicable time period for performance year or performance year
subset episode quality-adjusted target prices. Episode quality-adjusted
target prices are updated to account for Medicare payment updates no
less than 2 times per year, for updated quality-adjusted target prices
effective October 1 and January 1, and at other intervals if necessary.
(3) Episodes that straddle performance years or performance year
subsets or payment updates. The quality-adjusted target price that
applies to the type of episode as of the date of admission for the
anchor hospitalization is the quality-adjusted target price that
applies to the episode.
* * * * *
(b) * * *
(1) * * *
(iii) Episodes beginning in 2016 through 2018 for each of
performance year subsets 5.1 and 5.2.
(2) * * *
(iii) Regional historical episode payments for performance year 4
and each of performance year subsets 5.1 and 5.2.
* * * * *
(8) Inclusion of reconciliation payments and repayments. For
performance years 3, 4, and each of performance year subsets 5.1 and
5.2 only, reconciliation payments and repayment amounts under Sec.
510.305(f)(2) and (3) and from LEJR episodes included in the BPCI
initiative are included in historical episode payments.
(c) * * *
(1) Discount factors affected by the quality incentive payments and
the composite quality score. In all performance years and performance
year subsets, the discount factor may be affected by the quality
incentive payment and composite quality score as provided in Sec.
510.315 to create the effective discount factor or applicable discount
factor used for calculating reconciliation payments and repayment
amounts. The quality-adjusted target prices incorporate the effective
or applicable discount factor at reconciliation.
(2) Discount factor for reconciliation payments. The discount
factor for reconciliation payments in all performance years and
performance year subsets is 3.0 percent.
(3) * * *
(iii) In performance year 4 and each of performance year subsets
5.1 and 5.2, 3.0 percent.
* * * * *
0
27. Section 510.305 is amended by revising paragraphs (b), (d)(1)
introductory text, (e) introductory text, (e)(1) introductory text,
(e)(1)(i), (ii), and (iii), (e)(1)(v)(A) introductory text,
(e)(1)(v)(A)(3), (e)(1)(v)(B) introductory text, (e)(1)(v)(B)(3),
(e)(1)(v)(C), (f)(1)(ii), (g)(1) and (3), (h) introductory text, (h)(5)
and (6), (i), (j), and (k)(4) to read as follows:
Sec. 510.305 Determination of the NPRA and reconciliation process.
* * * * *
(b) Reconciliation. CMS uses a series of reconciliation processes,
which CMS performs as described in paragraphs (d) and (f) of this
section, after the end of each performance year 1 through 4 to
establish final payment amounts to participant hospitals for CJR
episodes for a given performance year. Following the end of each
performance year 1 through 4, CMS determines actual episode payments
for each episode for the performance year (other than episodes that
have been canceled in accordance with Sec. 510.210(b)), and determines
the amount of a reconciliation payment or repayment amount. Within
performance year 5, CMS separately performs the reconciliation
processes described in paragraphs (d) and (f) of this section for
performance year subsets 5.1 and 5.2 and following the end of each
performance year subset 5.1 and 5.2, CMS separately determines the
actual
[[Page 71200]]
episode payment for each episode for the subset of the performance year
(other than episodes that have been canceled in accordance with Sec.
510.210(b)) and determines the amount of a reconciliation payment or
repayment for each of performance year subsets 5.1 and 5.2.
* * * * *
(d) * * *
(1) Beginning 2 months after the end of each of performance years 1
through 4 and performance year subset 5.1 and 5 months after the end of
performance year subset 5.2, CMS does all of the following:
* * * * *
(e) Calculation of the NPRA. By comparing the quality-adjusted
target prices described in Sec. 510.300 and the participant hospital's
actual episode spending for each of performance years 1 through 4 and
each of performance year subsets 5.1 and 5.2 and applying the
adjustments in paragraph (e)(1)(v) of this section, CMS establishes an
NPRA for each participant hospital for each such performance year or
performance year subset.
(1) Initial calculation. In calculating the NPRA for each
participant hospital for each of performance years 1 through 4 and each
of performance year subsets 5.1 and 5.2, CMS does the following:
(i) Determines actual episode payments for each episode included in
the performance year or performance year subset (other than episodes
that have been canceled in accordance with Sec. 510.210(b)) using
claims data that is available 2 months after the end of the performance
year or performance year subset. Actual episode payments are capped, as
applicable, at the amount determined in accordance with Sec.
510.300(b)(5) for the performance year or performance year subset at
the amount determined in paragraph (k) of this section for episodes
affected by extreme and uncontrollable circumstances, or at the quality
adjusted target price determined for that episode under Sec. 510.300
for an episode with actual episode payments that include a claim with a
COVID-19 diagnosis code and initiate after the earlier of March 31,
2021 or the last day of the emergency period described in paragraph
(k)(4) of this section.
(ii) Multiplies each episode quality-adjusted target price by the
number of episodes included in the performance year or performance year
subset (other than episodes that have been canceled in accordance with
Sec. 510.210(b)) to which that episode quality-adjusted target price
applies.
(iii) Aggregates the amounts computed in paragraph (e)(1)(ii) of
this section for all episodes included in the performance year or
performance year subset (other than episodes that have been canceled in
accordance with Sec. 510.210(b)).
* * * * *
(v) * * *
(A) Limitation on loss. Except as provided in paragraph
(e)(1)(v)(C) of this section, the total amount of the NPRA and
subsequent reconciliation calculation for a performance year or
performance year subset cannot exceed the following:
* * * * *
(3) For performance year 4 and each of performance year subsets 5.1
and 5.2, 20 percent of the amount calculated in paragraph (e)(1)(iii)
of this section for the performance year or performance year subset.
* * * * *
(B) Limitation on gain. The total amount of the NPRA and subsequent
reconciliation calculation for a performance year or performance year
subset cannot exceed the following:
* * * * *
(3) For performance year 4 and each of performance year subsets 5.1
and 5.2, 20 percent of the amount calculated in paragraph (e)(1)(iii)
of this section for the performance year or performance year subset.
* * * * *
(C) Financial loss limits for rural hospitals, SCHs, MDHs, and
RRCs. If a participant hospital is a rural hospital, SCH, MDH, or RRC,
then for performance year 2, the total repayment amount for which the
participant hospital is responsible due to the NPRA and subsequent
reconciliation calculation cannot exceed 3 percent of the amount
calculated in paragraph (e)(1)(iii) of this section. For performance
years 3 and 4 and for performance year subsets 5.1 and 5.2, the amount
cannot exceed 5 percent of the amount calculated in paragraph
(e)(1)(iii) of this section.
(f) * * *
(1) * * *
(ii) Subject to paragraph (f)(1)(iii) of this section, for
performance years 2 through 4 and for each of performance year subsets
5.1 and 5.2, results from the subsequent reconciliation calculation for
a prior year's reconciliation as described in paragraph (i) of this
section and the post-episode spending and ACO overlap calculations as
described in paragraph (j) of this section are added to the current
year's NPRA in order to determine the reconciliation payment or
repayment amount.
* * * * *
(g) * * *
(1) CMS assesses each participant hospital's performance on quality
metrics, as described in Sec. 510.315, to determine whether the
participant hospital is eligible to receive a reconciliation payment
for a performance year or performance year subset.
* * * * *
(3) If the hospital's composite quality score described in Sec.
510.315 is below acceptable, defined as less than 4.00 for a
performance year or performance year subset, the hospital is not
eligible for a reconciliation payment.
* * * * *
(h) Reconciliation report. CMS issues each participant hospital a
CJR reconciliation report for the performance year or performance year
subset. Each CJR reconciliation report contains the following:
* * * * *
(5) As applicable, the NPRA and subsequent reconciliation
calculation amount for the previous performance year or performance
year subset.
(6) As applicable, the post-episode spending amount and ACO overlap
calculation for the previous performance year or performance year
subset.
* * * * *
(i) Subsequent reconciliation calculation. (1) Fourteen months
after the end of each of performance years 1 through 4 and performance
year subset 5.1 and seventeen months after the end of performance year
subset 5.2, CMS performs an additional calculation, using claims data
available at that time, to account for final claims run-out and any
additional episode cancelations due to overlap between the CJR model
and other CMS models and programs, or for other reasons as specified in
Sec. 510.210(b).
(2) The subsequent calculation for each of performance years 1
through 4 and performance year subset 5.1 occurs concurrently with the
first reconciliation process for the following performance year (or in
the case of performance year subset 5.1, with the first reconciliation
of performance year subset 5.2) . If the result of the subsequent
calculation is different than zero, CMS applies the stop-loss and stop-
gain limits in paragraph (e) of this section to the aggregate
calculation of the amounts described in paragraphs (e)(1)(iv) and
(i)(1) of this section for that performance year or performance year
subset (the initial reconciliation
[[Page 71201]]
and the subsequent reconciliation calculation) to ensure such amount
does not exceed the applicable stop-loss or stop-gain limits. The
subsequent reconciliation calculation for performance year subset 5.2
will occur independently in 2023.
(j) Additional adjustments to the reconciliation payment or
repayment amount. (1) In order to account for shared savings payments,
CMS will reduce the reconciliation payment or increase the repayment
amount for the subsequent performance year (for performance years 1
through 4 and performance year subset 5.1) by the amount of the
participant hospital's discount percentage that is paid to the ACO in
the prior performance year as shared savings. (This amount will be
assessed independently for performance year subset 5.2 in 2023.) This
adjustment is made only when the participant hospital is a participant
or provider/supplier in the ACO and the beneficiary in the CJR episode
is assigned to one of the following ACO models or programs:
(i) The Pioneer ACO model.
(ii) The Medicare Shared Savings Program (excluding Track 3 for CJR
episodes that initiate on or after July 1, 2017).
(iii) The Comprehensive ESRD Care Initiative (excluding a track
with downside risk for CJR episodes that initiate after July 1, 2017).
(iv) The Next Generation ACO model (excluding CJR episodes that
initiate on or after July 1, 2017).
(2) If the average post-episode Medicare Parts A and B payments for
a participant hospital in the prior performance year or performance
year subset is greater than 3 standard deviations above the regional
average post-episode payments for the same performance year or
performance year subset, then the spending amount exceeding 3 standard
deviations above the regional average post-episode payments for the
same performance year or performance year subset is subtracted from the
net reconciliation or added to the repayment amount for the subsequent
performance year for years 1 through 4 and performance year subset 5.1,
and assessed independently for performance year subset 5.2.
(k) * * *
(4) For a fracture or non-fracture episode with a date of admission
to the anchor hospitalization that is on or within 30 days before the
date that the emergency period (as defined in section 1135(g) of the
Act) begins or that occurs on or before March 31, 2021 or the last day
of such emergency period, whichever is earlier, actual episode payments
are capped at the quality adjusted target price determined for that
episode under Sec. 510.300.
0
28. Section 510.315 is amended by revising paragraphs (a), (b)
introductory text, and (d) to read as follows:
Sec. 510.315 Composite quality scores for determining reconciliation
payment eligibility and quality incentive payments.
(a) General. A participant hospital's eligibility for a
reconciliation payment under Sec. 510.305(g), and the determination of
quality incentive payments under paragraph (f) of this section, for a
performance year or performance year subset depend on the hospital's
composite quality score (including any quality performance points and
quality improvement points earned) for that performance year or
performance year subset.
(b) Composite quality score. CMS calculates a composite quality
score for each participant hospital for each performance year or
performance year subset which equals the sum of the following:
* * * * *
(d) Quality improvement points. For performance year 1, if a
participant hospital's quality performance percentile on an individual
measure described in Sec. 510.400(a) increases from the corresponding
time period in the previous year by at least 2 deciles on the
performance percentile scale, then the hospital is eligible to receive
quality improvement points equal to 10 percent of the total available
point for that individual measure up to a maximum composite quality
score of 20 points. For each of performance years 2 through 4 and for
each of performance year subsets 5.1 and 5.2, if a participant
hospital's quality performance percentile on an individual measure
described in Sec. 510.400(a) increases from the previous performance
year or performance year subset by at least 2 deciles on the
performance percentile scale, then the hospitals is eligible to receive
quality improvement points equal to 10 percent of the total available
point for that individual measure up to a maximum composite quality
score of 20 points.
* * * * *
0
29. Section 510.400 is amended by--
0
a. Revising paragraphs (a) introductory text, (b)(2) introductory text,
(b)(2)(i), (b)(2)(ii) introductory text, and (b)(3)(v) introductory
text; and
0
b. By adding paragraph (b)(3)(vi).
The revisions and addition read as follows:
Sec. 510.400 Quality measures and reporting.
(a) Reporting of quality measures. The following quality measures
are used for public reporting, for determining whether a participant
hospital is eligible for reconciliation payments under Sec.
510.305(g), and whether a participant hospital is eligible for quality
incentive payments under Sec. 510.315(f) in the performance year or
performance year subset:
* * * * *
(b) * * *
(2) Hospitals must also submit the amount of requested THA/TKA
patient-reported outcomes data required for each performance year or
performance year subset of the model in order to be considered
successful in submitting voluntary data.
(i) The amount of requested THA/TKA patient-reported outcomes data
to submit, in order to be considered successful will increase each
subsequent year of the model over the 5 years of the model (with the
exception of performance year subset 5.2, for which CMS will request
the same amount of THA/TKA patient-reported outcomes data as
performance year subset 5.1, updated to reflect the timeframe
applicable to performance year subset 5.2).
(ii) A phase-in approach that determines the amount of requested
THA/TKA patient-reported outcomes data to submit over performance years
1 through 4 and performance year subset 5.1 (with the exception of
performance year subset 5.2, for which CMS will request the same amount
of THA/TKA patient-reported outcomes as performance year subset 5.1,
updated to reflect the timeframe applicable to performance year subset
5.2) of the program will be applied so that in year 1 successful
submission of data would mean CMS received all requested THA/TKA
patient-reported outcomes and limited risk variable data on both of the
following:
* * * * *
(3) * * *
(v) Year 5 (subset 5.1, January 1, 2020-December 31, 2020).
Submit--
* * * * *
(vi) Year 5 (subset 5.2, January 1, 2021-September 30, 2021).
Submit--
(A) Post-operative data on primary elective THA/TKA procedures for
>=80% or >=200 procedures performed between July 1, 2019 and June 30,
2020; and
(B) Pre-operative data on primary elective THA/TKA procedures for
>=80% or >=200 procedures performed between July 1, 2020 and June 30,
2021, unless CMS requests a more limited data set, in
[[Page 71202]]
which case, submit all requested data elements.
* * * * *
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Office of the Secretary
For the reasons set forth in the preamble, the Department of Health
and Human Services amends 45 CFR parts 147, 155, and 182 as set forth
below:
PART 147--HEALTH INSURANCE REFORM REQUIREMENTS FOR THE GROUP AND
INDIVIDUAL HEALTH INSURANCE MARKETS
0
30. The authority citation for part 147 is revised to read as follows:
Authority: 42 U.S.C. 300gg through 300gg-63, 300gg-91, and
300gg-92, as amended, and section 3203, Pub. L. 116-136, 134 Stat.
281.
0
31. Section 147.130 is amended--
0
a. In paragraph (a)(1)(iii) by removing ``and'' after the semicolon;
0
b. In paragraph (a)(1)(iv) by removing the period at the end of the
paragraph and adding ``; and'' in its place;
0
c. By adding paragraph (a)(1)(v);
0
d. By revising paragraph (a)(3)(i);
0
e. By adding paragraph (a)(3)(iii);
0
f. By revising paragraphs (b)(1) and (b)(2)(i) and (ii); and
0
g. By adding paragraphs (b)(3) and (e).
The revisions and additions read as follows:
Sec. 147.130 Coverage of preventive health services.
(a) * * *
(1) * * *
(v) Any qualifying coronavirus preventive service, which means an
item, service, or immunization that is intended to prevent or mitigate
coronavirus disease 2019 (COVID-19) and that is, with respect to the
individual involved--
(A) An evidence-based item or service that has in effect a rating
of A or B in the current recommendations of the United States
Preventive Services Task Force; or
(B) An immunization that has in effect a recommendation from the
Advisory Committee on Immunization Practices of the Centers for Disease
Control and Prevention (regardless of whether the immunization is
recommended for routine use). For purposes of this paragraph
(a)(1)(v)(B), a recommendation from the Advisory Committee on
Immunization Practices of the Centers for Disease Control and
Prevention is considered in effect after it has been adopted by the
Director of the Centers for Disease Control and Prevention.
* * * * *
(3) * * *
(i) Subject to paragraphs (a)(3)(ii) and (iii) of this section,
nothing in this section requires a plan or issuer that has a network of
providers to provide benefits for items or services described in
paragraph (a)(1) of this section that are delivered by an out-of-
network provider, or precludes a plan or issuer that has a network of
providers from imposing cost-sharing requirements for items or services
described in paragraph (a)(1) of this section that are delivered by an
out-of-network provider.
* * * * *
(iii) A plan or issuer must provide coverage for and must not
impose any cost-sharing requirements (such as a copayment, coinsurance,
or a deductible) for any qualifying coronavirus preventive service
described in paragraph (a)(1)(v) of this section, regardless of whether
such service is delivered by an in-network or out-of-network provider.
For purposes of this paragraph (a)(3)(iii), with respect to a
qualifying coronavirus preventive service and a provider with whom the
plan or issuer does not have a negotiated rate for such service (such
as an out-of-network provider), the plan or issuer must reimburse the
provider for such service in an amount that is reasonable, as
determined in comparison to prevailing market rates for such service.
* * * * *
(b) * * *
(1) In general. A plan or issuer must provide coverage pursuant to
paragraph (a)(1) of this section for plan years (in the individual
market, policy years) that begin on or after September 23, 2010, or, if
later, for plan years (in the individual market, policy years) that
begin on or after the date that is one year after the date the
recommendation or guideline is issued, except as provided in paragraph
(b)(3) of this section.
(2) * * *
(i) A plan or issuer that is required to provide coverage for any
items and services specified in any recommendation or guideline
described in paragraph (a)(1) of this section on the first day of a
plan year (in the individual market, policy year), or as otherwise
provided in paragraph (b)(3) of this section, must provide coverage
through the last day of the plan or policy year, even if the
recommendation or guideline changes or is no longer described in
paragraph (a)(1) of this section, during the applicable plan or policy
year.
(ii) Notwithstanding paragraph (b)(2)(i) of this section, to the
extent a recommendation or guideline described in paragraph (a)(1)(i)
of this section that was in effect on the first day of a plan year (in
the individual market, policy year), or as otherwise provided in
paragraph (b)(3) of this section, is downgraded to a ``D'' rating, or
any item or service associated with any recommendation or guideline
specified in paragraph (a)(1) of this section is subject to a safety
recall or is otherwise determined to pose a significant safety concern
by a Federal agency authorized to regulate the item or service during a
plan or policy year, there is no requirement under this section to
cover these items and services through the last day of the applicable
plan or policy year.
(3) Rapid coverage of preventive services for coronavirus. In the
case of a qualifying coronavirus preventive service described in
paragraph (a)(1)(v) of this section, a plan or issuer must provide
coverage for such item, service, or immunization in accordance with
this section by the date that is 15 business days after the date on
which a recommendation specified in paragraph (a)(1)(v)(A) or (B) of
this section is made relating to such item, service, or immunization.
* * * * *
(e) Sunset date. The provisions of paragraphs (a)(1)(v),
(a)(3)(iii), and (b)(3) of this section will not apply with respect to
a qualifying coronavirus preventive service furnished on or after the
expiration of the public health emergency determined on January 31,
2020, to exist nationwide as of January 27, 2020, by the Secretary of
Health and Human Services pursuant to section 319 of the Public Health
Service Act, as a result of COVID-19, including any subsequent renewals
of that determination.
PART 155--EXCHANGE ESTABLISHMENT STANDARDS AND OTHER RELATED
STANDARDS UNDER THE AFFORDABLE CARE ACT
0
32. The authority citation for part 155 continues to read as follows:
Authority: 42 U.S.C. 18021-18024, 18031-18033, 18041-18042,
18051, 18054, 18071, and 18081-18083.
0
33. Section 155.1318 is added to read as follows:
Sec. 155.1318 Modification from the normal public notice requirements
during the public health emergency.
(a) The Secretary and the Secretary of the Treasury may modify, in
part, the State public notice requirements under
[[Page 71203]]
Sec. 155.1312 and the Federal public notice procedures under Sec.
155.1316 to expedite a decision on a proposed waiver request during the
public health emergency, as defined in 42 CFR 400.200, when a delay
would undermine or compromise the purpose of the proposed waiver
request and be contrary to the interests of consumers. These
flexibilities are limited to event-triggered, emergent situations, and
the flexibilities outlined in this section will not be available for
States seeking to address a threat to consumers' access to health
coverage or care that existed prior to the public health emergency for
COVID-19.
(b) A State must meet all of the following criteria to request a
modification under paragraph (a) of this section:
(1) The State must request a modification under paragraph (a) of
this section, in the form and manner specified by the Secretaries.
(2) The State must have acted in good faith, and in a diligent,
timely, and prudent manner in the preparation of the request for a
modification under paragraph (a) of this section, and the waiver
application request, as applicable.
(3) The State must, as applicable, detail in its request for a
modification from State-level notice procedures under paragraph (a) of
this section the justification for the request as it relates to the
public health emergency and the alternative public notice procedures it
proposes to implement at the State level, including public hearings,
that are designed to provide the greatest opportunity and level of
meaningful public input from impacted stakeholders that is practicable
given the emergency circumstances underlying the State's request for a
modification.
(4) The State must, as applicable, detail in its request for a
modification from Federal-level notice procedures under paragraph (a)
of this section the justification for the request and the alternative
public notice procedures it requests to be implemented at the Federal
level.
(c) The Secretary and the Secretary of the Treasury will evaluate a
State's request for a modification under paragraph (a) of this section
and issue their modification determination within approximately 15
calendar days after the request is received.
(d) The Secretary will publish on the CMS website any modification
determinations within 15 calendar days of the Secretary and the
Secretary of the Treasury making such a determination, as well as the
approved revised timeline for public comment under the approved
alternative State or Federal public notice procedures, as applicable.
(e) The State must publish on its website any modification requests
and determinations within 15 calendar days of receipt of the
determination, as well as the approved revised timeline for public
comment under the alternative State or Federal public notice
procedures, as applicable.
(f) The State must, as applicable, implement the alternative public
notice procedures at the State level if the State's modification
request is approved and, if required, amend the waiver application
request.
0
34. Section 155.1320 is amended--
0
a. In paragraph (c)(1) by adding a paragraph heading; and
0
b. By adding paragraph (c)(2).
The additions read as follows:
Sec. 155.1320 Monitoring and compliance.
* * * * *
(c) * * *
(1) Notification requirements for public forum. * * *
(2) Modification from the normal post award requirements during the
public health emergency. (i) The Secretary and the Secretary of the
Treasury may modify, in part, State post award requirements under this
paragraph (c)(2) for an approved waiver request during the public
health emergency, as defined in 42 CFR 400.200, when the application of
the post award public notice requirements would be contrary to the
interests of consumers during the public health emergency. These
flexibilities are limited to event-triggered, emergent situations, and
the flexibilities outlined in this section will not be available for
States seeking to address a threat to consumers' access to health
coverage or care that existed prior to the public health emergency for
COVID-19.
(ii) A State must meet all of the following criteria to request a
modification under paragraph (c) of this section:
(A) The State must request a modification under paragraph (c)(2) of
this section, in the form and manner specified by the Secretaries.
(B) The State must have acted in good faith, and in a diligent,
timely, and prudent manner to comply with the monitoring and compliance
requirement under the waiver and the terms and conditions of the
agreement between the Secretary and the Secretary of the Treasury, as
applicable, and the State to implement a section 1332 waiver and to
submit and prepare the request for a modification under paragraph
(c)(2) of this section.
(C) The State must detail in its request for a modification under
paragraph (c)(2) of this section the alternative post award public
notice procedures it proposes to implement at the State level,
including public hearings, that are designed to provide the greatest
opportunity and level of meaningful public input from impacted
stakeholders that is practicable given the emergency circumstances
underlying the State's request for a modification.
(D) The Secretary and the Secretary of the Treasury will evaluate a
State's request for a modification under paragraph (c)(2) of this
section and issue their modification determination within approximately
15 calendar days after the request is received.
(E) The State must publish on its website any modification requests
and determinations within 15 calendar days of receipt of the
determination, as well as information on the approved revised timeline
for the State's post award public notice procedures, as applicable.
* * * * *
0
35. Subchapter E-T, consisting of part 182, is added to subtitle A to
read as follows:
Subchapter E-T--Price Transparency
PART 182--PRICE TRANSPARENCY FOR COVID-19 DIAGNOSTIC TESTS
Subpart A--General Provisions
Sec.
182.10 Basis and scope.
182.20 Definitions.
182.30 Applicability.
Subpart B--Public Disclosure Requirements
182.40 Requirements for making public cash prices for a diagnostic
test for COVID-19.
Subpart C--Monitoring and Penalties for Noncompliance
182.50 Monitoring and enforcement.
182.60 Corrective action plans.
182.70 Civil monetary penalties.
Subpart D--Appeals of Civil Monetary Penalties
182.80 Appeal of penalty.
182.90 Failure to request a hearing.
Authority: Section 3202(b), Pub. L. 116-136, 134 Stat. 281.
Subpart A--General Provisions
Sec. 182.10 Basis and scope.
This part implements section 3202(b)(1) of the Coronavirus Aid,
Relief, and Economic Security Act (Pub. L. 116-136, March 27, 2020)
(CARES Act), which requires that during the emergency period declared
under section 319 of the PHS Act (42 U.S.C.
[[Page 71204]]
247d), providers of diagnostic tests for COVID-19 make public the cash
price for such tests on a public internet website of such provider.
This part also implements section 3202(b)(2) of the CARES Act, which
authorizes the Secretary to impose a civil monetary penalty (CMP) on
any provider of a diagnostic test for COVID-19 that does not comply
with section 3202(b)(1) of the CARES Act and that has not completed a
corrective action plan to comply with that section, in an amount that
does not exceed $300 per day that the violation is ongoing.
Sec. 182.20 Definitions.
The following definitions and abbreviated terms apply to this part:
Cash price means the charge that applies to an individual who pays
cash (or cash equivalent) for a COVID-19 diagnostic test.
COVID-19 for purposes of this part is the abbreviated term for the
virus called SARS-CoV-2 and the disease it causes, called coronavirus
disease 2019.
Diagnostic test for COVID-19 (``COVID-19 diagnostic test'') means a
COVID-19 in vitro diagnostic test described in section 6001 of the
Families First Coronavirus Response Act (Pub. L. 116-127, March 18,
2020), as amended by section 3201 of the CARES Act (Pub. L. 116-136,
March 27, 2020).
Provider of a diagnostic test for COVID-19 (``provider'') means any
facility that performs one or more COVID-19 diagnostic tests.
Sec. 182.30 Applicability.
(a) General applicability. The requirements of this part apply to
each provider of a diagnostic test for COVID-19 as defined at Sec.
182.20.
(b) Duration of requirements. The requirements of this part are
applicable during the public health emergency (PHE) determined to exist
nationwide as of January 27, 2020, by the Secretary of Health and Human
Services pursuant to section 319 of the PHS Act on January 31, 2020, as
a result of confirmed cases of COVID-19, including any subsequent
renewals.
Subpart B--Public Disclosure Requirements
Sec. 182.40 Requirements for making public cash prices for a
diagnostic test for COVID-19.
(a) General rules. (1) Except as provided under paragraph (b) of
this section, a provider of a COVID-19 diagnostic test must make public
the information described in paragraph (c) of this section
electronically via the internet.
(2) The information described in paragraph (c) of this section, or
a link to such information, must appear in a conspicuous location on a
searchable homepage of the provider's website.
(3) The information described in paragraph (c) of this section must
be displayed in a manner that is easily accessible, without barriers,
and ensures that the information is accessible:
(i) Free of charge;
(ii) Without having to establish a user account or password; and
(iii) Without having to submit personal identifiable information
(PII).
(4) The provider must include all of the following terms on its
homepage:
(i) The provider's name;
(ii) The term ``price'';
(iii) The term ``cost'';
(iv) The term ``test'';
(v) The term ``COVID''; and
(vi) The term ``coronavirus''.
(b) Exception. A provider of a COVID-19 diagnostic test that does
not have its own website must make public the information described in
paragraph (c) of this section:
(1) In writing, within two business days upon request; and
(2) On a sign posted prominently at the location where the provider
offers a COVID-19 diagnostic test, if such location is accessible to
the public.
(c) Required information. For purposes of paragraphs (a) and (b) of
this section, the provider must make public the following information:
(1) A plain-language description of each COVID-19 diagnostic test
that is offered by the provider;
(2) The billing code used for each COVID-19 diagnostic test;
(3) The provider's cash price for each such COVID-19 diagnostic
test; and
(4) Any additional information as may be necessary for the public
to have certainty of the cash price that applies to each COVID-19
diagnostic test.
Subpart C--Monitoring and Penalties for Noncompliance
Sec. 182.50 Monitoring and enforcement.
(a) Monitoring. (1) CMS may evaluate whether a provider has
complied with the requirements under Sec. 182.40.
(2) CMS may use methods to monitor and assess provider compliance
with the requirements under this part, including, but not limited to,
the following, as appropriate:
(i) CMS' evaluation of complaints made to CMS.
(ii) CMS review of an individual's or entity's analysis of
noncompliance as stated in the complaint.
(iii) CMS review of providers' websites.
(b) Actions to address provider noncompliance. If CMS concludes
that the provider is noncompliant with one or more of the requirements
of Sec. 182.40, CMS may take any of the following actions:
(1) Provide a written warning notice to the provider of the
specific violation(s).
(2) Request that the provider submit and comply with a corrective
action plan under Sec. 182.60.
(3) Impose a civil monetary penalty on the provider if the provider
fails to respond to CMS' request to submit a corrective action plan or
to comply with the requirements of a corrective action plan approved by
CMS.
Sec. 182.60 Corrective action plans.
(a) Violations requiring a corrective action plan. If CMS
determines a provider's noncompliance with the requirements of this
part continues after a warning notice, a corrective action plan may be
required. A violation may include, but is not limited to, the
following:
(1) A provider's failure to make public its cash price information
required by Sec. 182.40.
(2) A provider's failure to make public its cash price information
in the form and manner required under Sec. 182.40.
(b) Notice of violation. CMS may request that a provider submit and
comply with a corrective action plan, specified in a notice of
violation issued by CMS to a provider.
(c) Compliance with corrective action plan requests and corrective
actions. (1) A provider required to submit a corrective action plan
must do so, in the form and manner, and by the deadline, specified in
the notice of violation issued by CMS to the provider, and must comply
with the requirements of the corrective action plan approved by CMS.
(2) A provider's corrective action plan must specify elements
including, but not limited to:
(i) The corrective actions or processes the provider will take to
address the deficiency or deficiencies identified by CMS.
(ii) The timeframe by which the provider will complete the
corrective action.
(3) A corrective action plan is subject to CMS review and approval.
(4) After CMS' review and approval of a provider's corrective
action plan, CMS may monitor and evaluate the provider's compliance
with the corrective actions specified in the corrective action plan.
(d) Noncompliance with corrective action plan requests and
requirements. (1) A provider's failure to respond to
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CMS' request to submit a corrective action plan includes failure to
submit a corrective action plan in the form, manner, or by the
deadline, specified in a notice of violation issued by CMS to the
provider.
(2) A provider's failure to comply with the requirements of a
corrective action plan includes failure to correct violation(s) within
the specified timeframes.
Sec. 182.70 Civil monetary penalties.
(a) Basis for imposing civil monetary penalties. CMS may impose a
civil monetary penalty on a provider identified by CMS as noncompliant
according to Sec. 182.50, and that fails to respond to CMS' request to
submit a corrective action plan or to comply with the requirements of a
corrective action plan approved by CMS as described in Sec. 182.60(d).
(b) Notice of imposition of a civil monetary penalty. (1) If CMS
imposes a penalty in accordance with this part, CMS will provide a
written notice of imposition of a civil monetary penalty to the
provider via certified mail or another form of traceable carrier.
(2) This notice to the provider may include, but is not limited to,
the following:
(i) The basis for the provider's noncompliance, including, but not
limited to, the following:
(A) CMS' determination as to which requirement(s) the provider has
violated.
(B) The provider's failure to respond to CMS' request to submit a
corrective action plan or comply with the requirements of a corrective
action plan, as described in Sec. 182.60(d).
(ii) CMS' determination as to the effective date for the
violation(s). This date is the latest date of the following:
(A) The first day the provider is required to meet the requirements
of this part.
(B) A date determined by CMS, such as one resulting from monitoring
activities specified in Sec. 182.50, or development of a corrective
action plan as specified in Sec. 182.60.
(iii) The amount of the penalty as of the date of the notice.
(iv) A statement that a civil monetary penalty may continue to be
imposed for continuing violation(s).
(v) Payment instructions.
(vi) A statement of the provider's right to a hearing according to
subpart D of this part.
(vii) A statement that the provider's failure to request a hearing
within 30 calendar days of the issuance of the notice permits the
imposition of the penalty, and any subsequent penalties pursuant to
continuing violations, without right of appeal in accordance with Sec.
182.90.
(3) If the civil monetary penalty is upheld, in part, by a final
and binding decision according to subpart D of this part, CMS will
issue a modified notice of imposition of a civil monetary penalty, to
conform to the adjudicated finding.
(c) Amount of the civil monetary penalty. (1) CMS may impose a
civil monetary penalty upon a provider for a violation of each
requirement of this part.
(2) The maximum daily dollar amount for a civil monetary penalty to
which a provider may be subject is $300. Even if the provider is in
violation of multiple discrete requirements of this part, the maximum
total sum that a single provider may be assessed per day is $300.
(3) The maximum daily amount of the civil monetary penalty will be
adjusted annually using the multiplier determined by the Office of
Management and Budget for annually adjusting civil monetary penalty
amounts under part 102 of this title.
(d) Timing of payment of civil monetary penalty. (1) A provider
must pay the civil monetary penalty in full within 60 calendar days
after the date of the notice of imposition of a civil monetary penalty
from CMS under paragraph (b) of this section.
(2) In the event a provider requests a hearing, pursuant to subpart
D of this part, the provider must pay the amount in full within 60
calendar days after the date of a final and binding decision, according
to subpart D of this part, to uphold, in whole or in part, the civil
monetary penalty.
(3) If the 60th calendar day described in paragraphs (d)(1) and (2)
of this section is a weekend or a Federal holiday, then the timeframe
is extended until the end of the next business day.
(4) In the event a civil money penalty is not paid in full within
60 days, CMS will follow the collections activities set forth in 45 CFR
part 30.
(e) Continuing violations. CMS may issue subsequent notice(s) of
imposition of a civil monetary penalty, according to paragraph (b) of
this section, that result from the same instance(s) of noncompliance.
Subpart D--Appeals of Civil Monetary Penalties
Sec. 182.80 Appeal of penalty.
(a) A provider upon which CMS has imposed a penalty under this part
may appeal that penalty in accordance with subpart D of part 150 of
this title, except as specified in paragraph (b) of this section.
(b) For purposes of applying subpart D of part 150 of this title to
appeals of civil monetary penalties under this part:
(1) ``Respondent'' means a provider, as defined in Sec. 182.20
that received a notice of imposition of a civil monetary penalty
according to Sec. 182.70(b).
(2) In deciding whether the amount of a civil money penalty is
reasonable, the administrative law judge (ALJ) may only consider
evidence of record relating to the following:
(i) The provider's posting(s) of its cash price information, if
available.
(ii) Material the provider timely previously submitted to CMS
(including with respect to corrective actions and corrective action
plans).
(iii) Material CMS used to monitor and assess the provider's
compliance according to Sec. 182.70(a)(2).
(3) The ALJ's consideration of evidence of acts other than those at
issue in the instant case under Sec. 150.445(g) of this title does not
apply.
Sec. 182.90 Failure to request a hearing.
(a) If a provider does not request a hearing within 30 calendar
days of the issuance of the notice of imposition of a civil monetary
penalty described in Sec. 182.70(b), CMS may impose the civil monetary
penalty indicated in such notice without right of appeal in accordance
with this part.
(1) If the 30th calendar day described paragraph (a) of this
section is a weekend or a Federal holiday, then the timeframe is
extended until the end of the next business day.
(2) [Reserved]
(b) The provider has no right to appeal a penalty with respect to
which it has not requested a hearing in accordance with Sec. 150.405
of this title, unless the provider can show good cause, as determined
at Sec. 150.405(b) of this title, for failing to timely exercise its
right to a hearing.
PART 182 [Transferred to Subchapter E]
0
36. Effective January 1, 2021, transfer part 182 from subchapter E-T to
subchapter E.
Subchapter E-T [Removed]
0
37. Effective January 1, 2021, remove subchapter E-T.
[FR Doc. 2020-24332 Filed 11-2-20; 4:15 pm]
BILLING CODE 4120-01-P
