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DEPARTMENT OF THE TREASURY System (IPPS). This IFC provides for duration of the public health emergency separate payment for new COVID–19 for COVID–19, regulations at 42 CFR Internal Revenue Service treatments under the Outpatient part 433, subpart G, apply from Prospective Payment System (OPPS) for , 2020, through the end of 26 CFR Part 54 the remainder of the PHE for COVID–19 the last month of the public health [TD 9931] when these treatments are provided at emergency for COVID–19 in accordance the same time as a Comprehensive with section 6008(b)(3) of the Families Office of the Secretary Ambulatory Payment Classification (C– First Coronavirus Response Act. APC) service. This rule also interprets Regulations at 42 CFR 510.300(a)(1)(i) 31 CFR Part 33 and implements the requirement to and (a)(1)(iii) are applicable 1, maintain Medicaid beneficiary 2020. RIN 1545–BP97 enrollment in order to receive the Comment date: To be assured temporary increase in Federal funding DEPARTMENT OF LABOR consideration, comments must be in the Families First Coronavirus received at one of the addresses Response Act (FFCRA). This IFC Employee Benefits Security provided below, no later than 5 p.m. on modifies policies of the Comprehensive Administration 4, 2021. Care for Joint Replacement (CJR) model ADDRESSES: In commenting, please refer and adds technical changes to 29 CFR Part 2590 to file code CMS–9912–IFC. accommodate these policy changes. Comments, including mass comment RIN 1210–AB98 Specifically, we are extending submissions, must be submitted in one Performance Year (PY) 5 by adding 6 DEPARTMENT OF HEALTH AND of the following three ways (please months, creating an episode-based choose only one of the ways listed): HUMAN SERVICES extreme and uncontrollable 1. Electronically. You submit circumstances COVID–19 policy, electronic comments on this regulation Centers for Medicare & Medicaid providing two reconciliation periods for to http://www.regulations.gov. Follow Services PY 5, and adding DRGs 521 and 522 for the ‘‘Submit a comment’’ instructions. hip and knee procedures. This rule also 42 CFR Parts 410, 411, 414, 417, 433, amends regulations regarding coverage 2. By regular mail. You may mail and 510 of preventive health services to written comments to the following implement section 3203 of the CARES address ONLY: Centers for Medicare & Office of the Secretary Act, which shortens the timeframe Medicaid Services, Department of within which non-grandfathered group Health and Human Services, Attention: 45 CFR Parts 147, 155, and 182 health plans and health insurance CMS–9912–IFC, P.O. Box 8016, Baltimore, MD 21244–8016. [CMS–9912–IFC] issuers offering non-grandfathered group or individual health insurance Please allow sufficient time for mailed RIN 0938–AU35 coverage must begin to cover without comments to be received before the cost sharing qualifying coronavirus close of the comment period. Additional Policy and Regulatory preventive services, including 3. By express or overnight mail. You Revisions in Response to the COVID– recommended COVID–19 may send written comments to the 19 Public Health Emergency immunizations. This IFC also revises following address ONLY: Centers for Medicare & Medicaid Services, AGENCY: Centers for Medicare & regulations to set forth flexibilities in the public notice requirements and post Department of Health and Human Medicaid Services (CMS), Department Services, Attention: CMS–9912–IFC, of Health and Human Services (HHS); award public participation requirements for State Innovation Waivers under Mail Stop C4–26–05, 7500 Security Internal Revenue Service, Department of Boulevard, Baltimore, MD 21244–1850. the Treasury; Employee Benefits section 1332 of the Patient Protection For information on viewing public Security Administration, Department of and Affordable Care Act (PPACA) comments, see the beginning of the Labor. during the public health emergency for COVID–19. SUPPLEMENTARY INFORMATION section. ACTION: Interim final rule with request FOR FURTHER INFORMATION CONTACT: for comments. DATES: Effective date: These regulations are effective on November 2, 2020, Laura Kennedy, (410) 786–3377, for SUMMARY: This interim final rule with except for amendatory instructions 36 discussion related to COVID–19 vaccine request for comments (IFC) discusses and 37, which are effective on January and administration payment provided CMS’s implementation of section 3713 1, 2021. under Medicare Part B. of the Coronavirus Aid, Relief, and Applicability date: Except as Lina Rashid, (443) 902–2823, or Economic Security Act (CARES Act), otherwise specified in this paragraph, Michelle Koltov, (301) 492–4225, which established Medicare Part B these regulations are applicable from Centers for Medicare & Medicaid coverage and payment for Coronavirus November 2, 2020, until the end of the Services, Department of Health and Disease 2019 (COVID–19) vaccine and public health emergency for COVID–19 Human Services, Services, Kimberly its administration. This IFC implements as determined by the HHS Secretary. Koch, (202) 622–0854, Department of requirements in the CARES Act that The regulations at 42 CFR 410.57, the Treasury, for issues related to State providers of COVID–19 diagnostic tests 410.152, 410.160, 411.15, 414.701, Innovation Waivers Policy and make public their cash prices for those 414.707, 414.900, and 414.904 and at 42 Regulatory Revisions in Response to the tests and establishes an enforcement CFR part 510 (other than 42 CFR COVID–19 Public Health Emergency. scheme to enforce those requirements. 510.300(a)(1)(i) and (iii)) are applicable Dr. Terri Postma or Rhonda Sheppard, This rule also establishes an add-on November 2, 2020. Because the (410) 786–8465, or via email at payment for cases involving the use of requirement at section 6008(b)(3) of the [email protected], for new COVID–19 treatments under the Families First Coronavirus Response provisions related to Price Transparency Medicare Inpatient Prospective Payment Act (FFCRA) is not limited to the for COVID–19 Diagnostic Testing.

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Cristina Nigro, (410) 786–7763, for community in responding to COVID–19 with developmental disabilities and issues related to the Medicare Inpatient (hereafter referred to as the PHE for board-and-care facilities.3 Prospective Payment System (IPPS) COVID–19). On 11, 2020, the As the health care community New COVID–19 Treatments Add-on WHO publicly declared COVID–19 a implements and updates recommended Payment (NCTAP) for the remainder of pandemic. On , 2020, prevention and control practices, the public health emergency. President Donald J. Trump (the regulatory agencies operating under David Mlawsky, (410) 786–1565, President) declared the COVID–19 appropriate waiver authority granted by Centers for Medicare & Medicaid pandemic a national emergency. the PHE for COVID–19 are also working Services, Department of Health and Effective , 2020, the Secretary to revise and implement regulations that Human Services, Elizabeth Schumacher, renewed the , 2020 support these health care community (202) 693–8335, Employee Benefits determination that was previously infection prevention and treatment Security Administration, Department of renewed on 21, 2020 and 23, practices. Based on the current and Labor, Dara Alderman, (202) 317–5500, 2020 that a PHE exists and has existed projected increases in the incidence rate Internal Revenue Service, Department of since , 2020. of COVID–19 in the US, observed the Treasury, for issues related to Rapid The Administration is committed to fatalities in the older adult population, Coverage of Preventive Services for ensuring that Americans have access to and the impact on health care workers Coronavirus. a COVID–19 vaccine through Operation at increased risk due to treating special Stephanie Bell, (410) 786–0617, for Warp Speed, a partnership among populations, CMS 4 is reviewing and issues related to the temporary increase components of the HHS, including the revising regulations, as appropriate, to in Federal Medicaid funding. Centers for Disease Control and offer states, providers, suppliers, and Bobbie Knickman, (410) 786–4161; Prevention (CDC), the Food and Drug group health plans and health insurance Heather Holsey, (410) 786–0028; Sarah Administration (FDA), the National issuers additional flexibilities in Mioduski, (410) 786–2014 or email Institutes of Health (NIH), and the furnishing and providing services to [email protected] for the Biomedical Advanced Research and combat the PHE for COVID–19 and to Comprehensive Care for Joint address and minimize the unique Replacement Model. Development Authority (BARDA). Operation Warp Speed engages with impact of the PHE for COVID–19 on SUPPLEMENTARY INFORMATION: private firms and other Federal other regulatory provisions. Inspection of Public Comments: All agencies, including the Department of CMS addressed additional policies in comments received before the close of Defense (DoD), Department of three previous interim final rules with the comment period are available for Agriculture, the Department of Energy, comment period (IFCs). The ‘‘Medicare viewing by the public, including any and the Department of Veterans Affairs. and Medicaid Programs; Policy and personally identifiable or confidential Regulatory Revisions in Response to the business information that is included in Through the work of the Federal Government and the private sector, COVID–19 Public Health Emergency’’ a comment. We post all comments IFC appeared in the , 2020 received before the close of the Operation Warp Speed seeks to accelerate the development, Federal Register (85 FR 19230) with an comment period on the following effective date of , 2020, and the website as soon as possible after they manufacture, and distribution of a COVID–19 vaccine to the American ‘‘Medicare and Medicaid Programs, have been received: http:// Basic Health Program, and Exchanges; regulations.gov. Follow the search people. The CDC has reported that some Additional Policy and Regulatory instructions on that website to view Revisions in Response to the COVID–19 public comments. people are at higher risk of severe illness from COVID–19.1 These higher- Public Health Emergency and Delay of Background risk categories include: Certain Reporting Requirements for the Skilled Nursing Facility Quality The United States is responding to an • Older adults, with risk increasing by age. Reporting Program’’ IFC appeared in the outbreak of respiratory disease caused • People who have serious chronic , 2020 Federal Register (85 FR by a novel coronavirus that was first medical conditions such as: 27550) with an effective date of May 8, detected in China and has now been ++ Obesity. 2020. The ‘‘Medicare and Medicaid detected in more than 190 countries ++ Cardiovascular disease. Programs, Clinical Laboratory internationally, and all 50 States, the ++ Diabetes mellitus. Improvement Amendments, and Patient District of Columbia, and U.S. ++ Hypertension. ++ Chronic lung disease. Protection and Affordable Care Act: territories. The virus has been named ++ Neurologic/Neurodevelopmental Additional Policy and Regulatory ‘‘severe acute respiratory syndrome disability.2 Revisions in Response to the COVID–19 coronavirus 2’’ (‘‘SARS-CoV–2’’) and the ++ Immunocompromised individuals. Public Health Emergency’’ IFC appeared disease it causes has been named • Residents of Long Term Care (LTC) in the 2, 2020 Federal ‘‘coronavirus disease 2019’’ (‘‘COVID– facilities, including nursing homes, Register (85 FR 54820) with an effective 19’’). Intermediate Care Facilities for On , 2020, the International date of , 2020. Individuals with Intellectual and This IFC implements a number of Health Regulations Emergency Developmental Disabilities (ICF/IIDs), measures intended to further the Committee of the World Health inpatient psychiatric and substance Administration’s commitment to ensure Organization (WHO) declared the abuse treatment facilities including every American has timely access to a outbreak a ‘‘Public Health Emergency of Institutions for Mental Disease (IMDs) & COVID–19 vaccine without any out-of- International Concern.’’ On January 31, Psychiatric Residential Treatment pocket expenses, no matter their source 2020, pursuant to section 319 of the Facilities (PRTFs), assisted living of coverage, or whether they are covered Public Health Service (PHS) Act (42 facilities, group homes for individuals at all. U.S.C. 247d), the Health and Human Services Secretary (the Secretary) 1 https://www.cdc.gov/mmwr/volumes/69/wr/ 3 https://www.cdc.gov/coronavirus/2019-ncov/ determined that a public health mm6915e3.htm. cases-updates/summary.html. emergency (PHE) exists for the United 2 https://www.cdc.gov/mmwr/volumes/69/wr/ 4 Throughout this IFC, unless otherwise specified, States to aid the nation’s health care mm6924e2.htm?s_cid=mm6924e2_w. ‘‘we’’ and ‘‘our’’ refer to CMS only.

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In this IFC, CMS discusses Section (ACIP) makes an applicable This IFC provides for separate 3713 of the Coronavirus Aid, Relief, and recommendation relating to a qualifying payment for New COVID–19 Treatments Economic Security (CARES) Act which coronavirus preventive service. under the Outpatient Prospective added the COVID–19 vaccine and its Section 3202(b) of the CARES Act Payment System (OPPS) for the administration to section 1861(s)(10)(A) establishes a requirement to publicize remainder of the PHE for COVID–19 of the Social Security Act (the Act) in cash prices for COVID–19 diagnostic when these treatments are provided at the same subparagraph as the flu and testing during the PHE. For purposes of the same time as a Comprehensive pneumococcal vaccines and their implementing section 3202(b) of the Ambulatory Payment Classification (C– administration. It also specified that CARES Act, this IFC adds a new 45 CFR APC) service. Although we do not under Medicare Part B, beneficiaries can part 182, including (1) definitions of expect that many beneficiaries would receive a COVID–19 vaccination ‘‘provider of a diagnostic test for both receive a primary C–APC service (vaccine and administration) with no COVID–19’’ (or ‘‘provider’’), ‘‘COVID–19 and a drug or biological for treating cost sharing (deductible or copayment). diagnostic test,’’ and ‘‘cash price,’’ and COVID–19 on the same claim, we In this IFC, HHS and the Departments (2) requirements for posting cash price nonetheless believe that as drugs or of Labor and the Treasury (referred to information on the internet, or upon biologicals become available and are collectively as ‘‘the Departments’’) request and through signage (if authorized or approved for the clarify certain aspects of coverage of applicable) if the provider does not have treatment of COVID–19 in the outpatient preventive services without cost sharing its own website. This IFC gives CMS setting, it would be appropriate to discretion to take any of the following under the current regulations mitigate any potential financial actions, which generally, but not implementing section 2713 of the Public disincentives for hospitals to provide necessarily, will occur in the following Health Service (PHS) Act, as added by these new treatments during the PHE for order if CMS determines the provider is PPACA and incorporated into the COVID–19. Therefore, effective for noncompliant with section 3202(b)(1) of Employee Retirement Income Security services furnished on or after the the CARES Act and the requirements of Act of 1974 (ERISA) by section 715 of effective date of this rule and until the § 182.40: ERISA and into the Internal Revenue end of the PHE, CMS is creating an • Provide a written warning notice to exception to its OPPS C–APC policy to Code (the Code) by section 9815 of the the provider of the specific violation(s). ensure separate payment for new Code. The Departments also amend • Request that a provider submit and COVID–19 treatments that meet certain those regulations to implement the comply with a corrective action plan criteria. unique requirements related to rapid (CAP) under § 182.60 if its This IFC adds a new subpart G, coverage of qualifying coronavirus noncompliance is not corrected after a Temporary FMAP Increase During the preventive services under section 3203 warning notice. Public Health Emergency for COVID–19, of the CARES Act. Specifically, this IFC • Impose a civil monetary penalty to 42 CFR part 433, including a new clarifies that plans and issuers subject to (CMP) on the provider if the provider § 433.400. This new provision interprets section 2713 of the PHS Act must cover fails to respond to CMS’ request to and implements section 6008(b)(3) of without cost sharing recommended submit a CAP or to comply with the the FFCRA to require states, as a immunizations as well as the requirements of a CAP approved by condition for receiving the temporary administration of such immunizations, CMS. FMAP increase described at section regardless of how the administration is This IFC creates a New COVID–19 6008(a) of the FFCRA, to maintain billed. This IFC also defines qualifying Treatments Add-on Payment (NCTAP) beneficiary enrollment with specified coronavirus preventive services under the Inpatient Prospective protections. The terms of new § 433.400 consistent with the definition provided Payment System (IPPS) for COVID–19 are effective immediately upon display in section 3203 of the CARES Act and cases that meet certain criteria. We of this rule. CMS’ previous clarifies that plans and issuers subject to believe that as drugs and biological interpretation, described in this section 2713 of the PHS Act must cover products become available and are preamble and in the FAQs cited therein, recommended immunizations for authorized or approved by FDA for the continues to apply up to the date this COVID–19 that are qualifying treatment of COVID–19 in the inpatient rule is effective. coronavirus preventive services, even if setting, it is appropriate to increase the This IFC modifies policies of the not listed for routine use on the current IPPS payment amounts to Comprehensive Care for Joint Immunization Schedules of the CDC. mitigate any potential financial Replacement (CJR) model and adds Due to the urgent need to ensure disincentives for hospitals to provide technical changes to accommodate these coverage of and access to qualifying new COVID–19 treatments during the policy changes. Specifically, we are coronavirus preventive services, and to PHE. Therefore, effective for discharges extending Performance Year (PY) 5 an ensure that participants, beneficiaries, occurring on or after the effective date additional 6 months, creating an and enrollees can access qualifying of this rule and until the end of the PHE episode-based extreme and coronavirus preventive services on the for COVID–19, this IFC establishes the uncontrollable circumstances COVID– expedited basis specified by statute, this NCTAP to pay hospitals the lesser of (1) 19 policy, providing two reconciliation IFC also provides that during the PHE 65 percent of the operating outlier periods for PY 5, and adding DRGs 521 for COVID–19, plans and issuers must threshold for the claim or (2) 65 percent and 522 for hip and knee procedures. cover, without cost sharing, qualifying of the amount by which the costs of the This IFC provides for flexibilities in coronavirus preventive services, case exceed the standard DRG payment, the public notice requirements for a regardless of whether such services are including the adjustment to the relative State Innovation Waiver (also referred to delivered by an in-network or out-of- weight under section 3710 of the CARES as a section 1332 waiver) described in network provider. This coverage is Act, for certain cases that include the section 1332 of PPACA that apply required to be provided within 15 use of a drug or biological product during the PHE for COVID–19. business days after the date the United currently authorized or approved for Specifically, this IFC gives the Secretary States Preventive Services Task Force treating COVID–19. The NCTAP will not of HHS and the Secretary of the (USPSTF) or the Advisory Committee be included as part of the calculation of Treasury the authority to modify, in on Immunization Practices of the CDC the operating outlier payments. part, the public notice procedures to

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expedite a decision on a proposed limits for adult flu vaccines range from provider or supplier such as a waiver request that is submitted or about $19 to $61 per adult dose.5 physician, non-physician practitioner, would otherwise become due during the We note that in the Calendar Year hospital outpatient department, home PHE for COVID–19. This IFC also gives 2021 Physician Fee Schedule Proposed health agency or skilled nursing facility. these Secretaries the authority to Rule (85 FR 50162–50163), CMS An entity or individual that does not modify, in part, the post-award public proposed to increase the Medicare otherwise qualify as a Medicare notice requirements for an approved payment rate for administration of the provider or supplier but wishes to waiver request that would otherwise flu, pneumococcal or HBV vaccine furnish mass immunization services take place or become due during the furnished by a physician, non-physician may be eligible to enroll in Medicare as a ‘‘Mass Immunization Roster Biller’’ via PHE for COVID–19. practitioner, or other supplier. CMS will address public comments on the the Form CMS–855 enrollment II. Provisions of the Interim Final proposal and establish payment rates for application (Medicare Enrollment Rule—Department of Health and administration of these vaccines by a Application: Clinics/Group Practices Human Services physician, non-physician practitioner, and Certain Other Suppliers; OMB or other supplier in the Calendar Year Control No.: 0938–0685; Expires 12/21). A. Medicare Coding and Payment for 2021 Physician Fee Schedule Final Aside from meeting all applicable COVID–19 Vaccine Rule, which will be issued later this enrollment requirements in 42 CFR part 1. Summary year. Note that the payment rates for 424, subpart P (and as outlined in CMS administration of these preventive Pub. 100–08 (Program Integrity Manual), This section of this IFC discusses vaccines established in the CY 2021 chapter 10, section 10.2.4), a party CMS’s implementation of section 3713 Physician Fee Schedule final rule do not enrolled only as a mass immunization of the CARES Act, which established apply when the vaccine is furnished by roster biller must comply with the Medicare Part B coverage and payment the providers and suppliers paid for following: (1) May not bill Medicare for for a COVID–19 vaccine and its administration under reasonable cost. any services other than pneumococcal administration. While section 3713(e) of Under the CY 2021 OPPS proposed rule, pneumonia vaccines (PPVs), influenza the CARES Act authorizes CMS to CMS proposed to assign the HCPCS virus vaccines, and their administration; (2) must submit claims through the implement section 3713 via ‘‘program codes for administration of the roster biller or centralized biller process; instruction or otherwise,’’ we believe it influenza, pneumococcal, and hepatitis and (3) the enrolled entity or individual is important to clarify in this IFC our B vaccines to APC 5691, Level 1 Drug Administration. See Addendum C to the must meet all applicable state and local interpretation of Section 3713 and licensure or certification requirements. ensure the public is aware of our plans CY 2021 OPPS/ASC proposed rule. Payment amounts for these preventive In other words, an enrolled mass to ensure timely Medicare Part B vaccines and their administration are immunizer roster biller may only roster coverage and payment for COVID–19 not adjusted based on product-specific bill Medicare for the services described vaccine and its administration. factors. in the previous sentence. (For more 2. Background on Medicare Part B Generally, providers and suppliers information on the enrollment process for mass immunization roster billers, see Coverage, Payment, Coding and Billing bill for the vaccine and the vaccine https://www.cms.gov/Medicare/ for Vaccines administration separately using different codes. For example, many Provider-Enrollment-and-Certification/ As required under section vaccine products are identified by AMA Become-a-Medicare-Provider-or- 1842(o)(1)(A)(iv) of the Act, the CPT codes in the 90000 series, while Supplier and/or contact your local Part Medicare Part B payment allowance others are identified by Level II HCPCS A/B Medicare Administrative limits for influenza, pneumococcal, and codes, usually beginning with the letter Contractor.) For entities that are already enrolled hepatitis B virus (HBV) vaccines are 95 Q. Vaccine administration services are Medicare providers and suppliers, these percent of the Average Wholesale Price described by the types of codes used to describe professional and/or hospital entities would contact their MAC if they (AWP) as reflected in the published plan to submit claims as a mass compendia except where the vaccine is outpatient services, and are typically identified by a G code for Medicare immunizer. Mass immunizers may furnished in a hospital outpatient submit claims for immunizations billing, or by a different AMA CPT code department, Rural Health Clinic (RHC), (vaccine and administration) on roster or Federally Qualified Health Center in the 90000 series. Many providers, professionals, and bills that include a limited set of (FQHC), skilled nursing facility, and information on each beneficiary and the home health. Where the vaccine is other suppliers can bill Medicare for the preventive vaccines and vaccine vaccine(s) they were given. We note that furnished in these settings, payment for HBV vaccinations require an assessment administration they furnish using the vaccine is based on reasonable cost. of a patient’s risk of contracting claims rules similar to those that apply hepatitis B; they require a physician’s For preventive vaccines described in to the other Medicare covered items and order and cannot be roster billed by section 1861(s)(10) of the Act, Medicare services. Additionally, certain entities mass immunizers. pays for both the vaccine and its can enroll under Medicare as mass administration. Under sections immunizers to offer and bill Medicare 3. Provisions of the CARES Act 1833(a)(1)(B), annual Part B deductible for flu vaccinations, pneumococcal Section 3713 of the CARES Act and coinsurance amounts do not apply vaccinations, or both to large groups of provides for coverage of the COVID–19 for these vaccinations. In 2020, payment Medicare beneficiaries under roster vaccine under Part B of the Medicare for vaccines is based on the 95 percent billing. A mass immunizer may be program without any beneficiary cost of the AWP for a particular vaccine enrolled in Medicare as another type of sharing. Specifically, section 3713 product except where furnished in the amended section 1861(s)(10)(A) of the 5 settings for which payment is based on https://www.cms.gov/Medicare/Medicare-Fee- Act to include COVID–19 vaccine and reasonable cost. For example, for the for-Service-Part-B-Drugs/ McrPartBDrugAvgSalesPrice/VaccinesPricing, its administration. The amendments 2020–2021 influenza season, payment accessed , 2020. made are effective on the date of

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enactment and apply to a COVID–19 that issuance of an EUA may be residents of long-term care facilities.10 vaccine beginning on the date that such appropriate for a COVID–19 vaccine, for The Medicare population includes vaccine is licensed under section 351 of which there is adequate manufacturing many beneficiaries who are in these the PHS Act (42 U.S.C. 262). Section information, once studies have higher-risk categories, primarily because 3713(e) of the CARES Act further states demonstrated the safety and most, (over 85 percent) 11 Medicare that the Secretary may implement the effectiveness of the vaccine in a clear beneficiaries are over 65 years old. provisions of, and the amendments and compelling manner, but before the Given the high risk nature of the made by, this section by program submission and/or formal review of the Medicare population, the circumstances instruction or otherwise. biologics license application for the of this nationwide pandemic, and FDA’s Under section 564 of the Federal vaccine. These guidance documents guidance that an EUA may be Food, Drug, and Cosmetic Act (FD&C state that in the case of vaccines being appropriate for a COVID–19 vaccine Act), the Commissioner of Food and developed for the prevention of COVID– prior to its licensure if there is a Drugs, as delegated authority by the 19, any assessment regarding an EUA demonstration of safety and efficacy in Secretary, may authorize, during the would be made on a case by case basis a clear and compelling manner from at effective period of a declaration of considering the target population, the least one Phase 3 clinical trial, we emergency or threat justifying characteristics of the product, the believe it is appropriate for Medicare to emergency authorized use, the preclinical and human clinical study consider any EUA under section 564 of introduction into interstate commerce of data on the product, and the totality of the FD&C Act issued for a COVID–19 unapproved medical products or the relevant available scientific vaccine during the PHE to be unapproved uses of approved medical evidence. The FDA has made clear in its tantamount to a license under section products to diagnose, treat, or prevent October 2020 guidance to industry that 351 of the PHS Act for the sole purpose serious or life-threatening diseases or for a COVID–19 vaccine for which there of considering such a vaccine to be conditions caused by chemical, is adequate information to ensure its described in section 1861(s)(10)(A) of biological, radiological and nuclear quality and consistency, issuance of an the Act. That is, even though section defense (CBRN) threat agents when EUA would require a determination by 3713 of the CARES Act refers to a there are no adequate, approved, and FDA that the vaccine’s benefits COVID–19 vaccine ‘‘licensed under available alternatives. On , outweigh its risks based on data from at section 351 of the PHS Act,’’ CMS could 2020, on the basis of his determination least one well-designed Phase 3 clinical consider any vaccine for which FDA of a PHE that has a significant potential trial that demonstrates the vaccine’s issued an EUA during the PHE, when to affect national security or the health safety and efficacy in a clear and furnished consistent with terms of the and security of United States citizens compelling manner. Because the EUA, to be eligible for Medicare living abroad involving COVID–19, the vaccine would be intended for coverage and payment. We consider our Secretary declared that circumstances administration to healthy people as a interpretation of section 3713(d) of the exist justifying the authorization of prophylactic measure, there must be a CARES Act to be consistent with emergency use of drugs and biological higher degree of certainty about the Congress’ intent to provide for Medicare products during the COVID–19 risks and benefits of the product than coverage without deductible or pandemic (85 FR 18250). Pursuant to needed for EUAs for medical products coinsurance of any COVID–19 vaccine this declaration, the Commissioner of intended for treatment of sick patients. (and its administration) that FDA has Food and Drugs, as delegated authority There are no historical examples in authorized to be introduced into by the Secretary, may issue an which Medicare has covered vaccines interstate commerce, which would be emergency use authorization (EUA) for for which an EUA was issued by FDA. the case both for a vaccine for which a drug or biological product if, after We recall that during the PHE involving emergency use is authorized under 8 consultation with officials such as the the 2009 H1N1 flu outbreak, Influenza section 564 of the FD&C Act and for a Director of the CDC and the Director of A (H1N1) 2009 Monovalent Vaccine was vaccine that is licensed under section the NIH, to the extent feasible and approved by the FDA on , 351 of the PHS Act. Our interpretation appropriate, the Commissioner 2009 on the basis of a supplement to the also would be consistent with Congress’ reasonably concludes that, among other applicant’s biologics license application general intent in the CARES Act and 9 criteria, based on the totality of (BLA) for influenza virus vaccine. In other recent legislation to provide for available scientific evidence, the our review of PHEs, there are no rapid coverage of COVID–19 vaccines. product may be effective in diagnosing, circumstances in which a vaccine We note that section 3713(e) of the treating or preventing such disease or product authorized for emergency use CARES Act permits CMS to implement condition, and the product’s known and has been covered or paid for by the changes made by that section potential benefits when used to Medicare. through ‘‘program instruction or diagnose, prevent, or treat such disease As discussed previously, the CDC otherwise,’’ and we intend to issue any or condition, outweigh its known and recognizes that the categories of people necessary instructions for Medicare potential risks. at higher risk of severe illness from providers and suppliers expediently in COVID–19 include older adults (with FDA’s 2020 guidance to industry order to ensure beneficiary access to risk increasing by age), people with titled ‘‘Development and Licensure of COVID–19 vaccines as quickly as chronic conditions such as Vaccines to Prevent COVID–19’’ 6 possible. and cardiovascular disease or diabetes, and October 2020 guidance to industry titled 10 https://www.cdc.gov/coronavirus/2019-ncov/ ‘‘Emergency Use Authorization for emergency-use-authorization-vaccines-prevent- _ _ 7 need-extra-precautions/index.html?CDC AA Vaccines to Prevent COVID–19’’ state covid-19, accessed , 2020. refVal=https%3A%2F%2F 8 Available at https://www.phe.gov/emergency/ www.cdc.gov%2Fcoronavirus%2F2019- 6 Available at https://www.fda.gov/regulatory- news/healthactions/phe/Pages/h1n1.aspx, accessed ncov%2Fneed-extra-precautions%2Fpeople-at- information/search-fda-guidance-documents/ on , 2020. increased-risk.html. development-and-licensure-vaccines-prevent-covid- 9 Available at https://www.fda.gov/vaccines- 11 https://www.cms.gov/Research-Statistics-Data- 19, accessed , 2020. blood-biologics/vaccines/influenza-h1n1-2009- and-Systems/Statistics-Trends-and-Reports/ 7 Available at https://www.fda.gov/regulatory- monovalent-vaccine-novartis-vaccines-and- Beneficiary-Snapshot/Downloads/Bene_ information/search-fda-guidance-documents/ diagnostics-limited, accessed October 14, 2020. Snaphot.pdf.

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4. Implementation and Methods of widespread access to the new vaccines. influenza vaccination is generally only Coding and Payment for COVID–19 Therefore, as soon as practicable after given once each flu season, CMS has Vaccine and Administration the authorization or licensure of each contemplated how to respond to Section 3713 of the CARES Act added COVID–19 vaccine product by FDA, we pandemics where payment for the COVID–19 vaccine and its will announce the interim coding and a additional doses of an influenza vaccine administration to section 1861(s)(10)(A) payment rate for its administration (or, during a season may be required. Thus, of the Act in the same subparagraph as in the case of the OPPS, an APC a two dose initial COVID–19 the flu and pneumococcal vaccines and assignment for each vaccine product’s vaccination schedule can be their administration. As such, the administration code), taking into accommodated under this general Medicare allowed amount for the consideration any product-specific costs approach. Also, the CARES Act permits COVID–19 vaccine will also be 95 or considerations involved in furnishing the Secretary to implement the percent of the average wholesale price the service. Such consideration may be provisions of, and the amendments (or reasonable cost, for example under necessary, specifically for COVID–19 made by, section 3713 by program OPPS). vaccines in the context of the pandemic, instruction or otherwise. As information Because COVID–19 vaccines are being in order to ensure that health care about vaccine products becomes developed rapidly and systems to providers can offer prompt access to available, we anticipate that updated operationalize payment of vaccination for a large number of people information, for example information administration will need to be as quickly as possible. We then concerning additional doses after initial implemented quickly to ensure anticipate addressing coding and vaccination, applicability of specific beneficiary access, we also recognize the payment rates for administration of the vaccine products to subsets of our need to establish coding and payment COVID–19 vaccine products through beneficiary population, or updates about for COVID–19 vaccine and future notice-and-comment rulemaking. billing would be disseminated primarily administration under Medicare Part B. In other words, the approach to by program instruction. Because there are many product-specific payment and coding described in this As part of this IFC, we are updating factors that are still unknown, including IFC will ensure efficient and timely the following regulations: the possibility of differential costs beneficiary access to COVID–19 vaccine • At § 410.57, Pneumococcal vaccine associated with each COVID–19 vaccine products, that for public health and flu vaccine, we are amending the product and storage and administration purposes may need to be administered section heading and adding a new requirements, we anticipate establishing to a large number of people during a paragraph to reference COVID–19 a unique administration code for each compressed period of time, until further vaccine. COVID–19 vaccine product. We believe rulemaking, such as annual rulemaking • At § 410.152, Amounts of payment, it is imperative that coding and payment under the Medicare Physician Fee we are amending § 410.152(l)(1) to be in place as soon as possible after Schedule, is possible. include the COVID–19 vaccine in the COVID–19 vaccines become available. Given that the COVID–19 vaccine and list of vaccines for which Medicare Part We anticipate establishing specific administration was added to the same B pays 100 percent of the Medicare coding and payment rates through subparagraph as the flu and payment amount. technical direction to the MACs, pneumococcal vaccines and • At § 410.160, Part B annual including instructions to make this administration under section deductible, we are amending information available to the public. We 1861(s)(10)(A) of the Act, we believe it § 410.160(b)(2) to include the COVID–19 also anticipate posting information on would be appropriate to use billing vaccine in the list of vaccines that are coding, payment, and billing for processes for COVID–19 vaccinations not subject to the Part B annual COVID–19 vaccines and vaccine that are similar to those in place for flu deductible and do not count toward administration on the CMS website. and pneumococcal vaccinations. With meeting that deductible. This approach will maintain public the pressing need to ensure broad access • At § 411.15, Particular services transparency while allowing CMS to to a COVID–19 vaccine, it would be excluded from coverage, we are pay appropriately for particular appropriate to allow COVID–19 amending § 411.15(e) to add an vaccines and vaccine administration as vaccinations to be provided through the exception for COVID–19 vaccinations to quickly as practicable once they are mass immunization and roster billing the general exclusion of coverage for authorized or licensed for use by FDA. process that is in place for flu and immunizations. We anticipate that payment rates for the pneumococcal vaccinations. We • At § 414.701, Purpose, we are administration of other Part B recognize that, at this time, there is very amending the list of statutorily covered preventive vaccines and related limited detailed information on COVID– drugs to include the COVID–19 vaccine. services, such as the flu and 19 vaccines and their administration • At § 414.707, Basis of Payment, we pneumococcal vaccines, would serve to and that information on these vaccines are amending § 414.707(a)(2)(iii) to inform the payment rates for is likely to evolve as they reach the include the COVID–19 vaccine in the administration of COVID–19 vaccines. market and then experience with them list of vaccines with a payment limit CMS ordinarily establishes Medicare is gained. At this time, we believe that calculated using 95 percent of the payment rates for particular items and the COVID–19 vaccines will be average wholesale price. services, through notice-and-comment administered as one or two parenteral • At § 414.900, Basis and scope, we rulemaking. Because of the unique doses, thus we believe that using the are amending § 414.900(b)(3) to include circumstances of the PHE for COVID–19 Part B influenza vaccination approach the COVID–19 vaccine in the list of pandemic and the anticipated, specific that permits certain providers and mass statutorily covered drugs. conditions for the entry of COVID–19 immunization to bill for the product • At § 414.904, Average sales price as vaccine products into the marketplace, strikes a balance between the need to the basis for payment, we are amending we believe it is necessary to initially vaccinate many millions of Medicare § 414.904(e)(1) to include the COVID–19 dispense with the rulemaking process in patients promptly and the lack of vaccine in the list of vaccines with order to make Medicare payment detailed information about particular payment limits calculated using 95 available in a timely manner to ensure COVID–19 vaccine products. Although percent of the average wholesale price.

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5. Medicare Advantage and Cost Plans furnishing a single service exceeds the in-network with the cost plan. CMS Under sections 1852(a)(1) and cost threshold established in using the believes that it is necessary and 1876(c)(2) of the Act, Medicare formula in § 422.109(a), it is considered appropriate to ensure that cost plan Advantage (MA) plans and cost plan a significant cost and the FFS Medicare enrollees, like other Medicare organizations must cover all benefits program provides coverage for the beneficiaries, are provided access to the covered under Part A and Part B of service until the costs are factored into COVID–19 vaccine and its Original Medicare, subject to limited Medicare Advantage payments. administration without cost sharing. exclusions. Therefore, all MA plans and Therefore, this legislative change would Section 1876(i)(3)(D) of the Act cost plans must cover a COVID–19 be subject to an analysis whether the authorizes us to impose ‘‘other terms vaccine and its administration described new benefit results in significant costs. and conditions not inconsistent with in section 1861(s)(10)(A) of the Act. As The significant cost threshold will be [section 1876]’’ that are deemed described previously, the interpretation met assuming that the projected cost ‘‘necessary and appropriate.’’ Requiring cost plans to comply with the same cost of section 3713 of the CARES Act per-beneficiary-per-year is greater than sharing protections available to adopted in this rule will result in Part approximately $13, which is 0.1 percent Medicare beneficiaries in the FFS B coverage of a COVID–19 vaccine for of the national average per capita costs. program and enrolled in Medicare which FDA issues an EUA during the If the threshold is reached, Medicare Advantage plans is necessary and PHE, and administration of that vaccine beneficiaries enrolled in MA plans will appropriate, so that cost is not a barrier when furnished consistent with terms of receive coverage of the COVID–19 for beneficiaries to get the vaccine, such EUA. As amended by section 3713 vaccine and its administration through particularly during the public health of the CARES Act, section the Medicare FFS program and would emergency when ensuring access is of 1852(a)(1)(B)(iv)(VI) of the Act prohibits be able to access the COVID–19 vaccine, paramount importance. To ensure that MA plans from using cost sharing that without cost sharing, at any FFS provider or supplier that participates in cost plan enrollees also do not pay cost exceeds the cost sharing imposed under sharing for the COVID–19 vaccine and original Medicare for a COVID–19 Medicare and is eligible to bill under Part B for vaccine administration, its administration when received from vaccine and its administration when an in-network provider at least until the MA coverage is provided because they including those enrolled in Medicare as a mass immunizer or a physician, non- end of the public health emergency for are covered under Part B under section COVID–19, we are adding a new 1861(s)(10)(A) of the Act. physician practitioner, hospital, clinic, or group practice. paragraph (e)(4) to § 417.454 to require Section 1852(a)(5) of the Act and 42 section 1876 cost plans to cover without Section 3713 of the CARES Act added CFR 422.109 provide that when a cost sharing the COVID–19 vaccine and Medicare Part B coverage for a COVID– National Coverage Determination (NCD) its administration described in section 19 vaccine and its administration and or legislative change in benefits, such as 1861(s)(10)(A) of the Act without cost provides that MA plans must cover the the addition of Part B coverage of a sharing for the duration of the PHE for new benefit without cost sharing. While COVID–19 vaccine and its the COVID–19 pandemic, specifically administration, results in significant section 1876(c)(2) of the Act ensures the end of the emergency period defined costs that have not been included in the that enrollees in Medicare cost plans in paragraph (1)(B) of section 1135(g) of capitation payments made to MA plans, will have coverage of a COVID–19 the Act, which is the PHE declared by coverage of the new benefit will be vaccine and its administration, section the Secretary on January 31, 2020 and provided through the Medicare FFS 3713 of the CARES Act did not amend any renewals thereof. program until the capitation payments section 1876 of the Act to provide take the new significant costs into similar cost-sharing protections for B. COVID–19 Vaccine Coverage for account. The payment rates for MA enrollees in cost plans who receive the Medicaid, CHIP, and BHP Beneficiaries organizations for contract years 2020 vaccine from an in-network provider. Under section 6008 of the FFCRA, and 2021 have been set without Nor is there a provision affirmatively states’ and territories’ Medicaid including the costs for a COVID–19 relieving cost plans of the obligation to programs may receive a temporary 6.2 vaccine and its administration. cover the new Part B benefit. Because percentage point increase in the Federal Therefore, if coverage of a COVID–19 the Medicare FFS program covers Part A Medical Assistance Percentage (FMAP). vaccine and its administration during and Part B items and services furnished Under section 6008(b)(4) of the FFCRA, that period results in significant costs, to cost plan enrollees by out-of-network to receive that increase, a state or section 1852(a)(5) of the Act and health care providers that participate in territory must cover COVID–19 testing § 422.109 will apply to require Medicare the Medicare FFS program, cost plan services and treatments, including FFS coverage of the vaccine and its enrollees will receive the COVID–19 vaccines and the administration of such administration. vaccine and its administration without vaccines, for Medicaid enrollees The cost projection used for the cost sharing when they go to a health without cost sharing. That coverage is determination whether the legislative care provider that is out of the cost required during any quarter for which change results in significant costs is plan’s network. See 42 CFR the state or territory claims the based on an analysis by the Chief 417.436(a)(5) and 417.448. However, temporary FMAP increase under FFCRA Actuary of CMS of the actuarial costs there is no requirement for cost plans to section 6008, and the FMAP increase is associated with a NCD or the legislative cover the COVID–19 vaccine and its available through the end of the quarter change in benefits and compared to the administration without cost sharing in which the PHE for COVID–19 ends. thresholds specified in the regulation at (that is, with cost sharing that is the CMS is not aware of any states or § 422.109. This analysis is generally same as original Medicare) when the territories not currently claiming this performed once a Medicare FFS vaccine is furnished by an in-network temporary FMAP increase, or of any payment rate is determined for the health care provider. Many enrollees state or territory that intends to cease service. If the estimated cost of an NCD may seek the COVID–19 vaccine from claiming it. Accordingly, Medicaid or legislative change represents at least the health care provider they usually see coverage of a COVID–19 vaccine and its 0.1 percent of the national average per or from whom they receive most of their administration, without cost-sharing, is capita costs or the average cost of health care; that provider is likely to be expected to be available for most

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Medicaid beneficiaries through the end vaccines and their administration, to federally qualified health center (FQHC) of the quarter in which the PHE for eligibility groups whose coverage is or rural health clinic, or who are Indians COVID–19 ends. For the remainder of limited by statute or under an existing (as defined in section 4 of the Indian this section of preamble, references to section 1115 demonstration to a narrow Health Care Improvement Act) receive ‘‘state’’ or ‘‘states’’ in discussions of range of benefits that would not ACIP-recommended vaccinations Medicaid policy also include the ordinarily include this coverage, such as through the Vaccines for Children (VFC) territories. groups that receive Medicaid coverage program, described at section 1928 of To meet the requirement in FFCRA only for COVID–19 testing, family the Act. The Centers for Disease Control section 6008(b)(4) to cover a COVID–19 planning services and supplies, or and Prevention (CDC) will determine if vaccine and its administration without tuberculosis-related services. The COVID–19 vaccines will be included in cost sharing, states must compensate COVID–19 Claims Reimbursement to the VFC program. Coverage of the Medicaid providers with a vaccine Health Care Providers and Facilities for administration of a VFC-covered administration fee or reimbursement for Testing and Treatment of the Uninsured vaccine for Medicaid-eligible children a provider visit during which a vaccine Program (COVID–19 Claims would be provided by the state dose is administered, even if the vaccine Reimbursement program) administered Medicaid program. dose is furnished to the provider at no by the Health Resources and Services After the FFCRA section 6008(b)(4) cost. Administration (HRSA) is available for requirements are no longer in effect in There are some very limited reimbursement of a COVID–19 vaccine a state, the state also has the option to circumstances in which the FFCRA and vaccine administration costs for cover a COVID–19 vaccine and its section 6008(b)(4) coverage individuals who would not receive administration for other eligibility requirements would not apply. CMS has Medicaid coverage for a COVID–19 groups. Such groups include the parent/ not interpreted section 6008(b)(4) of the vaccine or its administration because caretaker relative eligibility group at 42 FFCRA to require that state Medicaid their Medicaid coverage is for limited CFR 435.110, eligibility groups for programs cover the services described in benefit packages only. individuals who are age 65 or older or that provision for individuals whose After the requirements in section who are eligible on the basis of Medicaid eligibility is limited by statute 6008(b)(4) of FFCRA are no longer in blindness or a disability, and pregnant to only a narrow range of benefits that effect in a state, the state must cover women enrolled under 42 CFR 435.116 would not otherwise include these COVID–19 vaccines recommended by who are eligible for full state plan services. FFCRA section 6008(b)(4) did the ACIP, and their administration, for benefits. If a state elects to cover a not amend the varying benefits packages several populations under existing COVID–19 vaccine and its that are required for different Medicaid statutory and regulatory authority. All administration for any one of these eligibility groups under section Medicaid-enrolled children under the groups, it must do so for all of them, 1902(a)(10) of the Act. In some cases, age of 21 eligible for the Early and except that with respect to the pregnant beneficiaries’ coverage is limited by Periodic Screening, Diagnostic and women group described in 42 CFR statute to a very narrow range of benefits Treatment (EPSDT) benefit must receive 435.116, per 42 CFR 440.250(p) states and services that typically would not ACIP-recommended vaccines pursuant can cover a vaccine and its include services described in FFCRA to section 1905(r)(1)(A)(i) and (B)(iii) of administration as a pregnancy-related section 6008(b)(4), such as COVID–19 the Act.12 Coverage of ACIP- service while not providing the same vaccines or their administration (see, coverage for the other eligibility groups. recommended vaccines without cost- e.g., the limitations described in the Outside of the period in which FFCRA sharing is required for any adult matter following section 1902(a)(10)(G) section 6008(b)(4) applies to a state, the populations who receive coverage of the Act for some Medicaid eligibility state has the option to apply cost through Alternative Benefit Plans groups). Nor did FFCRA section sharing to coverage of a COVID–19 (ABPs), including the adult expansion 6008(b)(4) direct states to amend vaccine or its administration unless the population described at section existing demonstration projects under beneficiary is in an eligibility group that 1902(a)(10)(A)(i)(VIII) of the Act, section 1115(a) of the Act, through is exempt from cost-sharing under pursuant to section 1937(b)(5) of the which states may offer eligibility to section 1916 or section 1916A of the Act Act, 42 CFR 440.347(a), and 45 CFR groups not otherwise eligible under title and regulations at 42 CFR 447.56 (for XIX of the Act, and can opt to provide 156.115(a)(4) and 147.130. Some states example, most children under age 18, these groups with limited benefits. may also elect to receive a 1 percentage most pregnant women, most children in Moreover, after FFCRA was enacted, in point FMAP increase for their foster care, individuals receiving section 3716 of the CARES Act (Pub. L. expenditures on certain services, in services in an institution that already 116–136), Congress defined eligibility return for covering ACIP-recommended had their medical assistance reduced by for the COVID–19 testing-only optional vaccines and their administration their income, individuals receiving Medicaid eligibility group described in without cost-sharing for adults under hospice care, and Indians who are section 1902(a)(10)(A)(ii)(XXIII) of the section 1905(a)(13) of the Act, pursuant currently receiving or have ever Act in a manner that recognized that to section 4106 of PPACA (as codified received an item or service furnished by certain limited-benefit Medicaid in section 1905(b) of the Act). Children an Indian health care provider or eligibility groups are ‘‘uninsured,’’ and through age 18 who are eligible for through referral under contract health therefore eligible to receive coverage for Medicaid (funded through both titles services). COVID–19 testing under that provision, XIX and XXI), as well as children who After the FFCRA section 6008(b)(4) without referring to or acknowledging are uninsured, who are not insured with requirements are no longer in effect in the FFCRA section 6008(b)(4) COVID– respect to the vaccine and who are a state, a COVID–19 vaccine and its 19 testing coverage requirement. See administered pediatric vaccines by a administration could also be a covered section 1902(ss) of the Act. Accordingly, service for many Medicaid eligibility CMS does not interpret FFCRA section 12 Medicaid enrolled children up to the age of 18 groups when furnished by a are generally exempt from cost sharing. For 6008(b)(4) to require states to provide children age 19 or 20 cost sharing for an ACIP- participating provider under certain COVID–19 testing and treatment recommended vaccine may apply, outside of an Medicaid benefits that are mandatory services without cost-sharing, including Alternative Benefit Plan. for many Medicaid eligibility groups,

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depending on how the state has defined currently operate a BHP. BHP coverage steps to reduce financial barriers to the amount, duration, and scope must include benefits in at least the ten testing for both insured and uninsured parameters of the benefit. Because essential health benefits described in individuals, including the following: inpatient and outpatient hospital section 1302(b) of the PPACA and must • The FFCRA was enacted on March services, physician services, and comply with the Exchange’s cost- 18, 2020. Section 6001 of the FFCRA Federally Qualified Health Center and sharing protections,14 which includes generally requires group health plans Rural Health Clinic services are providing all ACIP recommended and health insurance issuers offering mandatory Medicaid benefits for the vaccines without cost sharing. See group or individual health insurance categorically needy populations, sections 1331(a)(1), (a)(2)(B) and (b)(2) coverage to provide coverage for certain COVID–19 vaccine administration could of PPACA, and 42 CFR 600.405(a) and items and services, including in vitro be a covered service for many Medicaid 600.510(b). diagnostic testing products for the beneficiaries when provided by these Section 600.510(b) cross-references 45 detection of SARS–CoV–2, the virus that participating providers, at state option. CFR 147.130, which establishes causes COVID–19, or the diagnosis of States might also cover COVID–19 requirements related to the coverage of COVID–19 (referred to herein vaccine administration for beneficiaries preventive health services for BHP. For collectively as COVID–19 diagnostic under various optional state plan ABPs, 42 CFR 440.347 cross-references tests) when those items or services are benefits, such as the ‘‘other licensed 45 CFR part 156, which incorporates 45 furnished on or after , 2020, practitioner’’ benefit described in CFR 147.130, which establishes and during the PHE for COVID–19. section 1905(a)(6) of the Act and 42 CFR requirements related to the coverage of Plans and issuers must provide this 440.60, or the ‘‘preventive services’’ preventive health services. Consistent coverage without imposing any cost- benefit described in section 1905(a)(13) with the changes to 45 CFR 147.130 sharing requirements (including of the Act and 42 CFR 440.130(c). made through this rulemaking, during deductibles, copayments, and However, states would generally not the COVID–19 public health emergency coinsurance) or prior authorization or have the option to cover a COVID–19 BHP plans and Medicaid ABPs must other medical management vaccine or its administration for any provide coverage for and must not requirements. Related items and group whose coverage is limited by impose any cost-sharing for ‘‘qualifying services include those provided during statute or under a current section 1115 coronavirus preventive services,’’ urgent care center visits, in-person and demonstration to a narrow range of including a COVID vaccine, regardless telehealth office visits, and emergency benefits that would not ordinarily of whether the vaccine is delivered by room visits that result in an order for or include vaccine coverage. As described an in-network or out-of-network administration of an in vitro diagnostic above, the COVID–19 Claims provider. For details on the coverage product, to the extent that such items Reimbursement program administered requirements for ‘‘qualifying and services relate to the furnishing or by HRSA may be used to cover COVID– coronavirus preventive services’’ and administration of a COVID–19 19 treatment, including the the updates to 45 CFR 147.130 see diagnostic test, or to the evaluation of an administration of vaccines, for such section III of this IFC. individual for purposes of determining limited-benefit beneficiaries. In Lastly, we note that CMS intends this the need of the individual for a COVID– addition, a state might have the option, section only to be a description of 19 diagnostic test. Section 3201 of the subject to Federal approval, to propose current policy and existing law, with CARES Act, enacted on March 27, 2020, or amend a section 1115 demonstration the exception noted directly above for amended section 6001 of the FFCRA to to include this coverage for a group that BHP and Medicaid ABPs, and that CMS include a broader range of diagnostic would not otherwise be entitled to is not making any changes to its current tests that plans and issuers must cover receive it under the statute or under policy or regulatory requirements in this without any cost-sharing requirements current section 1115 authority. rule. or prior authorization or other medical The FFCRA section 6008(b)(4) management requirements. requirement does not apply to separate C. Price Transparency for COVID–19 • The COVID–19 Claims CHIPs.13 In separate CHIPs, states must Diagnostic Tests Reimbursement to Health Care cover ACIP-recommended vaccines and 1. Introduction Providers and Facilities for Testing and their administration for all children Treatment of the Uninsured Program under age 19 with no cost sharing. See Robust COVID–19 diagnostic testing provides reimbursements on a rolling section 2103(c)(1)(D) and (e)(2) of the is fundamental to the Federal basis directly to eligible providers for Act, and 42 CFR 457.410(b)(2) and Government’s strategy for controlling claims that are attributed to the testing 15 457.520(b)(4). Coverage of uninsured the spread of COVID–19. In and treatment of COVID–19 for certain pregnant women in a separate CHIP is recognition of the importance of uninsured individuals. The program is optional. Currently, the states that cover COVID–19 diagnostic testing, the funded via (1) the FFCRA Relief Fund, pregnant women in a separate CHIP Federal Government has taken several which includes funds received from the include all ACIP-recommended Public Health and Social Services vaccines with no cost sharing in this 14 As explained in rulemaking, this includes the prohibition on cost sharing for preventive health Emergency Fund, as appropriated in the coverage. However, current CMS services. See the Basic Health Program: State FFCRA and the Paycheck Protection interpretation is that this vaccine Administration of Basic Health Programs; Eligibility Program and Health Care Enhancement coverage is not required. and Enrollment in Standard Health Plans; Essential Act (PPPHCEA) (Pub. L. 116–139), The FFCRA section 6008(b)(4) Health Benefits in Standard Health Plans; which each appropriated funding to requirement also does not apply to the Performance Standards for Basic Health Programs; Premium and Cost Sharing for Basic Health reimburse providers for conducting Basic Health Program (BHP). Minnesota Programs; Federal Funding Process; Trust Fund and COVID–19 testing for the uninsured, and New York are the only states that Financial Integrity; Final Rule. 79 FR 14111 at and (2) the Provider Relief Fund, as 14128 (, 2014). appropriated in the CARES Act and the 13 15 In states that use title XXI funding to expand The White House, CDC and FDA document: 16 Medicaid eligibility for children, the FFCRA section Testing Overview, Opening Up America Again. PPPHCEA. 6008(b)(4) requirements apply to these title XXI Available at: https://www.whitehouse.gov/wp- funded Medicaid beneficiaries in the same way that content/uploads/2020/04/Testing-Overview- 16 FAQs for COVID–19 Claims Reimbursement to they do to all other Medicaid beneficiaries. Final.pdf. Health Care Providers and Facilities for Testing and

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• HHS has partnered with $300 per day that the violation is the CARES Act, requires plans and pharmacies, retail companies, and ongoing. issuers to provide coverage for an in health centers nationwide to make no- We believe that cash price posting by vitro diagnostic test, as defined in 21 cost COVID–19 diagnostic testing providers of diagnostic tests for COVID– CFR 809.3(a) (or its successor available to Americans in communities 19 is important for not only for plans regulations), for the detection of SARS– across the country.17 and issuers that must comply under CoV–2 or diagnosis of COVID–19, and Congress has also taken steps to section 3202(a) of the CARES Act but the administration of such a test that: (1) facilitate the reimbursement for COVID– also for individuals who seek COVID–19 Is approved, cleared, or authorized 19 diagnostic testing and to ensure that diagnostic testing. under section 510(k), 513, 515, or 564 of pricing for performance of such testing Therefore, we are adopting in this IFC the FD&C Act (21 U.S.C. 360(k), 360c, is publicly available. Specifically, policies that implement the requirement 360e, 360bbb–3); (2) the developer has section 3202(a) of the CARES Act in section 3202(b) of the CARES Act that requested, or intends to request, requires group health plans and issuers providers of diagnostic tests for COVID– emergency use authorization under providing coverage for items and 19 make public their cash price for such section 564 of the FD&C Act (21 U.S.C. services described in section 6001(a) of tests on the internet. Specifically, we are 360bbb–3), unless and until the the FFCRA to reimburse any provider of finalizing the following: (1) Definitions emergency use authorization request a COVID–19 diagnostic test an amount of ‘‘provider of a diagnostic test for under such section 564 has been denied that equals the negotiated rate, or, if the COVID–19’’ (herein referred to as or the developer of such test does not plan or issuer does not have a ‘‘provider’’), ‘‘diagnostic test for submit a request under such section negotiated rate with the provider, the COVID–19’’ (herein referred to as within a reasonable timeframe; (3) is cash price for such service that is listed ‘‘COVID–19 diagnostic test’’), and ‘‘cash developed in and authorized by a state price’’; (2) requirements for making by the provider on a public website. The that has notified the Secretary of HHS public cash prices; and (3) penalties for plan or issuer may also negotiate a rate of its intention to review tests intended non-compliance with the cash price with the provider that is lower than the to diagnose COVID–19; or (4) other tests posting requirements. cash price. More information related to that the Secretary of HHS determines health insurance issuer and group 2. Requirement That Providers of appropriate in guidance.18 We are health plan coverage and COVID–19 Diagnostic Tests Make Public therefore at § 182.20 defining a reimbursement for COVID–19 diagnostic Cash Prices for COVID–19 Diagnostic ‘‘diagnostic test for COVID–19’’ (also testing is available at https:// Tests referred to as a ‘‘COVID–19 diagnostic www.cms.gov/files/document/FFCRA- The rapid expansion of COVID–19 test’’) as a COVID–19 in vitro diagnostic Part-42-FAQs.pdf and https:// related diagnostic testing capacity is a test described in section 6001 of the www.cms.gov/files/document/FFCRA- top priority in HHS’ strategy to combat FFCRA, as amended by section 3201 of Part-43-FAQs.pdf. Specifically, the the pandemic. COVID–19 diagnostic the CARES Act. Such COVID–19 Departments note that the testing is generally performed by diagnostic tests are currently billed by reimbursement requirements under laboratories located in a variety of sites, providers using HCPCS and CPT codes CARES Act 3202(a) will apply to including for example: Government including, but not limited to: CPT codes COVID–19 diagnostic testing, as defined labs; hospital-run labs; clinician offices; 86408, 86409, 87635, 87426, 86328, and in this IFC. stand-alone labs; urgent care centers; 86769 and HCPCS codes U0001 through Section 3202(b) of the CARES Act and pharmacies. There are several types U0004. We intend this list of billing establishes a requirement for each of COVID–19 tests designed to detect codes to be illustrative, however, not provider of a diagnostic test for COVID– SARS–CoV–2 or to diagnose a possible exhaustive. Therefore, as noted 19 to publicize cash prices for such case of COVID–19, including molecular previously, a ‘‘COVID–19 diagnostic COVID–19 diagnostic testing. (RT–PCR) tests, which are used to detect test’’ is defined as a COVID–19 in vitro Specifically, section 3202(b)(1) of the the virus’s genetic material, and antigen diagnostic test described in section 6001 CARES Act requires each provider of a tests, which are used to detect specific of the FFCRA, as amended by section diagnostic test for COVID–19 to make proteins on the surface of the virus and 3201 of the CARES Act, even if a public the cash price for such test on a serology testing, which is used to look particular COVID–19 diagnostic test or public internet website of such provider for the presence of antibodies produced its billing code is not included on this during the emergency period declared by the body in response to infections. list. Codes continue to be created to under section 319 of the PHS Act. For purposes of implementing section address new and proprietary tests as Section 3202(b)(2) of the CARES Act 3202(b) of the CARES Act, we are they are developed. We therefore authorizes the Secretary to impose a adopting a new 45 CFR part 182, ‘‘Price anticipate updating this list in guidance civil monetary penalty (CMP) on any Transparency for COVID–19 Diagnostic as new tests and codes are developed. provider of a diagnostic test for COVID– Tests,’’ that will implement price Obtaining a diagnostic test for 19 that does not make public its cash transparency requirements for making COVID–19 generally can involve up to price for such test in compliance with public cash prices for performance of a three separate health care services for an section 3202(b)(1) of the CARES Act and COVID–19 diagnostic test. Section individual including evaluation by a that has not completed a corrective 182.10 states that part 182 implements practitioner of the need for such testing, action plan (CAP) to comply with that section 3202(b) of the CARES Act. and, once the provider determines the section. The statute states that the For purposes of section 6001(a)(1) of need for a COVID–19 diagnostic test, amount of the CMP must not exceed the FFCRA, as amended by section 3201 specimen collection and laboratory of the CARES Act, and as explained in analysis of the specimen, that is, actual Treatment of the Uninsured. Available at https:// guidance issued by the Departments, performance of a COVID–19 diagnostic www.hrsa.gov/coviduninsuredclaim/frequently- COVID–19 diagnostic tests include all in asked-questions. vitro diagnostic tests, which include 18 See Q3 of FAQs About Families First 17 Information on Community-Based Testing Sites Coronavirus Response Act and Coronavirus Aid, for COVID–19 can be found at https://www.hhs.gov/ molecular, antigen, and serological tests. Relief, And Economic Security Act Implementation coronavirus/community-based-testing-sites/ Specifically, section 6001(a) of the Part 42 available at: https://www.cms.gov/files/ index.html. FFCRA, as amended by section 3201 of document/FFCRA-Part-42-FAQs.pdf.

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test. For purposes of implementing functions).19 20 21 22 It is therefore our make public the cash price information section 3202(b), we are defining expectation that the ‘‘cash price’’ described in § 182.40(c) electronically, ‘‘provider of a diagnostic test for established by the provider will be and that the information itself, or a link COVID–19’’ (herein referred to as generally similar to, or lower than, rates to a web page that contains such ‘‘provider’’) as any facility that performs negotiated with in-network plans and information, must appear in a one or more COVID–19 diagnostic tests. insurers. If a provider has not conspicuous location on a searchable CMS regulates all laboratory testing established a ‘‘cash price’’ for a COVID– homepage on the provider’s website. We performed on humans for the purposes 19 diagnostic test that is lower than its recognize that some providers of a of diagnosis, prevention, or treatment in gross charge or retail rate, the provider COVID–19 diagnostic test, for example, the U.S. through the Clinical Laboratory must make public the undiscounted small or rural providers, may not have Improvement Amendments CLIA gross or retail rate found in its master websites. Therefore, in the event that a program (42 U.S.C. 263a). In order to price list (which is analogous to the provider does not have a website on perform COVID–19 testing, a facility hospital’s chargemaster). We do not which to post this cash price (whether that be a primary care believe that posting a ‘‘cash price’’ information, we are finalizing a policy provider’s office, urgent care center, should prevent a provider of a at § 182.40(b) to require the provider to make public its cash price information outpatient hospital site or stand-alone diagnostic test for COVID–19 from offering testing for free to individuals as in writing upon request within two laboratory) is required to hold a CLIA charity care or in an effort to combat the business days and by posting signage certificate based on the complexity of public health crisis, rather, the ‘‘cash prominently at the location where the the testing performed by the facility. price’’ would be the maximum charge provider offers a COVID–19 diagnostic Therefore, we expect that any ‘‘provider that may apply to a self-pay individual test in a place likely to be viewed by of a diagnostic test for COVID–19’’ paying out-of-pocket. We solicit members of the public seeking to obtain would either hold or have submitted a comment on this approach and whether and pay for such testing. If the provider CLIA application necessary to obtain a any additional standards should be does not have its own website or a CLIA certificate (including a certificate implemented to address any potential publicly accessible location then, upon of waiver, as applicable) and that such abuse. request and within two business days, testing would occur in facilities ranging Under new § 182.30(a) and (b), these the provider will be required to make from primary care provider offices to requirements apply to a ‘‘provider of a public its cash price information in urgent care centers to stand-alone diagnostic test for COVID–19’’ as writing to the requestor but will not be national laboratories. defined at § 182.20 and are applicable required to post signage at the location At § 182.20, we are defining ‘‘cash during the PHE for COVID–19 where it performs the COVID–19 price’’ as the charge that applies to an determined to exist nationwide as of diagnostic test. For purposes of individual who pays in cash (or cash January 27, 2020, by the HHS Secretary complying with the requirement that the equivalent) for a COVID–19 diagnostic under section 319 of the PHS on January cash price information be made public test. We believe this definition will 31, 2020, as a result of confirmed cases in writing, we will consider email provide a clear point of reference not of COVID–19, including any subsequent correspondence to the requester to be an only for individuals who seek such renewals. acceptable written format. We believe tests, but also for payers who wish to Finally, section 3202(b)(1) of the these policies will help ensure that the negotiate reimbursement rates with CARES Act states that each provider of public (including individuals, issuers, providers of diagnostic tests for COVID– a diagnostic test for COVID–19 shall health plans, and others) has access to make public the cash price for such test every provider’s COVID–19 diagnostic 19, or who wish to help direct their on a public internet website of such test cash prices, including those members to providers of diagnostic tests provider. We interpret this to mean that providers who do not perform COVID– for COVID–19 who charge cash prices providers must make public the cash 19 diagnostic tests at publicly accessible that payers believe to be reasonable. The prices for performing COVID–19 locations. We seek comment on these ‘‘cash price’’ is generally analogous to diagnostic tests on the provider’s issues, including the frequency by the ‘‘discounted cash price’’ as defined internet website. Specifically, as which providers may not have websites. at 45 CFR 180.20 for purposes of the discussed below, § 182.40(a)(1) and (2) Furthermore, at § 182.40(a)(3), we are Hospital Price Transparency final rule. require that each provider of a COVID– As we explained in that rule, providers requiring that providers of a COVID–19 19 diagnostic test that has a website diagnostic test display their cash price often offer discounts off their gross information in an easily accessible charges or make other concessions to 19 Rosato D. How Paying Your Doctor in Cash manner, without barriers, including, but individuals who pay for their own care Could Save You Money. Consumer Reports. , not limited to, ensuring the information (referred to as self-pay individuals) (84 2018. Available at: https://www.consumerreports. is accessible: Free of charge; without FR 65524). We also stated that the org/healthcare-costs/how-paying-your-doctor-in- cash-could-save-you-money/. having to establish a user account or discounted cash price may be generally 20 David Lazarus. Insured price: $2,758. Cash password; and without having to submit analogous to the ‘‘walk-in’’ rate that price: $521. Could our Healthcare System by any Dumber? . , 2019. personal identifiable information (PII). would apply to all self-pay individuals, In addition, we are requiring at regardless of insurance status, who pay Available at: https://www.latimes.com/business/ story/2019-07-29/column-could-our-healthcare- § 182.40(a)(4) that the provider’s in cash at the time of the service, and system-be-any-dumber. homepage contain certain keywords that that such charges are often lower than 21 Beck M. How to Cut Your Health-Care Bill: Pay we believe will increase the likelihood the rate the hospital negotiates with Cash. The Wall Street Journal. 15, 2016. Available at: https://www.wsj.com/articles/how-to- that the public will be able to locate the third party payers because billing self- cut-your-health-care-bill-pay-cash-1455592277. information using a search engine. pay individuals would not require many 22 Dr. Steven Goldstein. Patients Can Save Money Specifically, § 182.40(a)(4) requires that of the administrative functions that exist When They Pay Their Doctor In Cash. Houston all of the following terms be included for hospitals to seek payment from third Healthcare Initiative. 10, 2020. Available at: on the provider’s homepage: The party payers (for example, prior https://houstonhealthcareinitiative.org/patients- can-save-money-when-they-pay-their-doctor-in- provider’s name; ‘‘price’’; ‘‘cost’’; ‘‘test’’; authorization and billing cash/. ‘‘COVID’’; and ‘‘coronavirus.’’ We seek

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comment on whether providers should should adopt a more inclusive Finally, we seek comment on an have flexibility to select between using definition of a provider of a diagnostic approach that balances priorities to ‘‘COVID’’ or ‘‘coronavirus’’ and between test for purposes of this requirement. further price transparency for ‘‘cost’’ and ‘‘price’’ if the provider is Specifically, we seek comment on consumers and other stakeholders and linking to the information from its whether a ‘‘provider of a diagnostic test reduce barriers to COVID–19 testing. We homepage. for COVID–19’’ should be expanded to recognize that these final policies Finally, we believe that it is important include providers that perform become effective as of the date of for the provider to include certain additional services related to the display of this IFC and are applicable standardized information so that the performance of a COVID–19 diagnostic only until the end of the PHE. Even so, public can understand the relationship test, such as for specimen collection or we seek comment whether and to what between the posted cash price and the mileage fees that may be billed as part extent these final policies and the COVID–19 diagnostic test(s) offered by of or in conjunction with the specimen alternatives about which we are seeking the provider. Therefore, at § 182.40(c)(1) collection, if applicable. We are comment (for instance, expansion of the through (4), we are requiring all particularly interested in submissions definition of ‘‘provider’’) may lead to: providers to make public, along with the from stakeholders that include data, • Potential cost shifting from cash price for each COVID–19 both anecdotal and claims-based, on the providers or participants, beneficiaries, diagnostic test(s) that they offer, ways in which consumers request and and enrollees to group health plans or information that, at minimum, includes receive COVID–19 diagnostic testing, issuers, if the group health plan and a plain language description of each including the site of care, frequency, issuer reimbursement obligation for COVID–19 diagnostic test, the and type of provider. COVID–19 diagnostic testing is corresponding cash price, the billing We seek comment on the definition of expanded to cover such testing without code(s) for each such test(s), and any ‘‘cash price’’. We have heard concerns cost-sharing (including deductibles, co- additional information as may be from stakeholders that certain providers pays, and co-insurance) and as payment necessary for the public to be certain of may use the posting of a ‘‘cash price’’ in full for items and services that were the cash price for a particular COVID– as an opportunity to ‘‘price not previously covered in such a 23 24 25 19 diagnostic test. For example, if the gouge’’. We therefore specifically manner by group health plans or provider offers the same test at a seek comment on whether this issuers. different cash price that is dependent on definition or some other definition • Potential for group health plans or location or some other factor, then on its would help to mitigate concerns for issuers to negotiate rates that are lower website listing of cash prices, the price gouging by out-of-network than the cash price with out-of-network provider must indicate all the cash providers. We seek comment on providers with whom they do not have prices that apply to the test and relevant whether there are additional authorities established negotiated rates. distinguishing information as to when and safeguards that could be used to • Price gouging or other anti- each different cash price applies. We mitigate concerns for price gouging both competitive behavior (under both the believe that this information is for group health plans and issuers and policies and the alternatives for which necessary for the public, including for consumers receiving a COVID–19 we seek comment) by providers as well group health plans and health insurance diagnostic test. as any potential negative impact on issuers offering group or individual We seek comment regarding whether premiums in the future that have not health insurance coverage that must these requirements are sufficient to already been accounted for in 2021 provide reimbursement for COVID–19 inform consumers of the cash price for diagnostic testing pursuant to the a COVID–19 diagnostic test in advance rates. Please provide empirical requirements of section 3202(a) of the of receiving one and what, if any, evidence, if any, including based on CARES Act. This requirement applies to additional requirements or safeguards claims data during the PHE for COVID– 19. cash price information posted on the should be considered to avoid consumer • provider’s website, made available upon confusion or prevent unintended Potential savings to issuers and request and, where applicable, on consequences (for example, balance plans from insured consumers seeking signage. billing). Specifically, we seek comment out COVID–19 diagnostic testing from These requirements are applicable regarding how providers should post in-network providers, as opposed to the immediately; however, we seek cash prices so that they do not provider of their choice, as a result of comment on these requirements and inadvertently deter consumers from these increased price transparency may, as a result of public comment, seeking a test that would normally requirements. • revise these requirements or finalize result in no out-of-pocket cost to the Price sensitivity by consumers additional requirements. We also consumer. covered by group health plans or issuers specifically seek comment on the in their choice of provider, and definition of ‘‘diagnostic test for 23 Morgan Haefner. Out-of-network Providers awareness of any potential cost-shifting COVID–19’’ as solely a COVID–19 in Price Gouging COVID–19 tests, AHIP says. Becker’s to group health plans or issuers, or to vitro diagnostic test described in section Hospital Review Newsletter. , 2020. consumers themselves through balance Available at: https://www.beckershospitalreview. billing, as a result of these increased 6001 of FFCRA. com/payer-issues/out-of-network-providers-price- We seek comment on the definition of gouging-covid-19-tests-ahip-says.html. price transparency requirements. ‘‘provider of a COVID–19 diagnostic 24 Susannah Luthi. The $7,000 COVID Test: Why • Transparency benefits for the test’’. We seek comment on whether States are Stepping in to Shield Consumers. uninsured, who may already have an consumers may benefit from knowing POLITICO. , 2020. Available at: https:// incentive to find the lowest price. www.politico.com/news/2020/06/08/coronavirus- • the total cost of care for receiving a test-costs-304058. Group health plans or issuers taking COVID–19 test, including the doctor’s 25 Ken Alltucker. ‘I was floored’: Coronavirus test on new consumer education or other visit and specimen collection, in order prices charged by some hospitals and labs stun potential costs, for example, costs to protect themselves against potential consumers, spur questions. USA Today. September associated with incentivizing consumers 15, 2020. Available at: https://www.usatoday.com/ unexpected health care costs and make story/news/health/2020/09/15/covid-test-prices- covered by group health plans or issuers a more informed health care purchasing hospitals-scrutiny-congress-insurers-consumers/ to stay in network or seek care from decision and therefore whether we 3472304001/. lower cost providers.

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3. Monitoring and Enforcement of A provider that CMS identifies as • A provider’s failure to respond to Requirements To Publicize Cash Prices noncompliant and to which it offers an CMS’ request to submit a CAP includes for COVID–19 Diagnostic Tests opportunity to take corrective action to failure to submit a CAP in the form, Section 3202(b)(2) of the CARES Act come into compliance may be notified manner, or by the deadline, specified in authorizes and provides the Secretary via a warning notice of its deficiencies. a notice of violation issued by CMS to discretion to impose a CMP on any In response to the warning letter, a the provider. • A provider’s failure to comply with provider of a diagnostic test for COVID– provider may choose, but is not the requirements of a CAP includes 19 that is not in compliance with required, to submit documentation for failure to correct violation(s) within the section 3202(b)(1) of the CARES Act and CMS to review to determine compliance. CMS will review any specified timeframes. has not completed a CAP to comply We seek comment on this approach with the requirements of such documentation a provider may submit and, where applicable, a provider’s for monitoring providers of COVID–19 paragraph, in an amount not to exceed diagnostic testing for compliance with $300 per day that the violation is website or other form of written notice, to determine if the provider’s these requirements. Specifically, we ongoing. In this IFC, we are adopting seek comments on relying mechanisms to monitor the requirement noncompliance has been corrected. In the event that a provider does not have predominantly on complaints to that a provider of a diagnostic test for determine a provider’s potential COVID–19 publicize the cash price for its own website on which to post the cash price, CMS will require noncompliance. We further seek diagnostic testing and enforce these comments on issuing warning letters requirements, as necessary. documentation that the provider has the cash price in written form timely upon and requesting CAPs for violations a. Monitoring for Noncompliance and request and, where applicable, has related to making public cash prices for Pre-Penalty Actions posted signage at the provider’s facility. COVID–19 diagnostic testing. At § 182.60, we specify the Additionally, we seek comments on the Section 3202(b)(1) of the CARES Act length of time we should specify in does not prescribe monitoring requirements for CAPs. Specifically, § 182.60(a) states that a provider may be warning notices to allow corrections of procedures or the factors we should violations before issuance of a request consider in imposing penalties on required to submit a CAP if CMS determines a provider is noncompliant for CAP, and the length of time we providers for noncompliance. We should specify for providers to complete or the provider’s noncompliance anticipate relying predominantly on and return a CAP to CMS. complaints made to CMS by the public, continues after a warning notice. A including individuals, as well as issuers violation may include, but is not limited b. Civil Monetary Penalties and plans, regarding providers’ to, a provider’s failure to make public its Under section 3202(b)(2) of the potential noncompliance. Specifically, cash price information for COVID–19 CARES Act, CMS may impose a CMP on in response to such complaints, we may diagnostic testing required by § 182.40 a provider that we identify as investigate and evaluate whether a and a provider’s failure to make public noncompliant. At § 182.70, we are provider has complied with the its cash price information in the form finalizing requirements related to requirements discussed above. The and manner required under § 180.40. imposition of CMPs. At § 182.70(a), we monitoring methods for determining a Section 182.60(b) states that CMS may finalize a policy that CMS may impose provider’s compliance with the request that a provider submit and a CMP on a provider that we identify as requirements for publicizing the cash comply with a CAP, specified in a noncompliant with any of the price for a COVID–19 diagnostic test notice of violation issued by CMS to a requirements of § 182.40, and that fails may include, but are not limited to, the provider. Additionally, in § 182.60(c), to respond to CMS’ request to submit a following, as appropriate: we specify the following provisions CAP or to comply with the requirements • CMS’ evaluation of complaints related to CAPs: of a CAP approved by CMS described in • made to CMS. A provider required to submit a § 182.60(d). • CMS’ review of an individual’s or CAP must do so, in the form and Under the statute, the maximum daily entity’s analysis of noncompliance as manner, and by the deadline, specified dollar amount for a CMP to which a stated in the complaint. in the notice of violation issued by CMS provider may be subject is $300, even if • CMS’ review of providers’ websites to the provider, and must comply with the provider is in violation of multiple or, where a provider does not have a the requirements of the CAP approved discrete requirements of § 182.40. The website, its written notice and signage. by CMS. maximum daily amount of the CMP will The IFC includes these monitoring • A provider’s CAP must specify be adjusted annually using the methods in the regulations at elements including, but not limited to, multiplier determined by the Office of § 182.50(a). the corrective actions or processes the Management and Budget (OMB) for Additionally, at § 182.50(b), we are provider will take to address the annually adjusting CMP amounts under finalizing discretion for CMS to take any deficiency or deficiencies identified by 45 CFR part 102. CMS will provide a of the following actions if CMS CMS, and the timeframe by which the written notice of imposition of a CMP to determines the provider is provider will complete the corrective the provider via certified mail or noncompliant with the requirements of action. another form of traceable carrier. The § 182.40: • A CAP is subject to CMS review elements of this notice to the provider • Provide a written warning notice to and approval. After CMS’ review and will include but are not limited to the the provider of the specific violation(s). approval of a provider’s CAP, CMS may following: • Request that a provider submit and monitor and evaluate the provider’s • The basis for the provider’s comply with a CAP under § 182.60. compliance with the corrective actions noncompliance, including, but not • Impose a CMP on the provider if the specified in the CAP. limited to, the following: CMS’ provider fails to respond to CMS’ Section 182.60(d) outlines the determination as to which request to submit a CAP or to comply following provisions for identifying a requirement(s) the provider has with the requirements of a CAP provider’s noncompliance with CAP violated; and the provider’s failure to approved by CMS. requests and requirements: respond to CMS’ request to submit a

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CAP or comply with the requirements of statutory maximum daily amount that a Federal holiday, then the timeframe is a CAP. would be applicable to all noncompliant extended until the end of the next • CMS’ determination as to the providers. business day. The provider has no right effective date for the violation(s). to appeal a penalty with respect to c. Appeals Process • The amount of the penalty as of the which it has not requested a hearing in date of the notice. We believe it is important to establish accordance with 45 CFR 150.405, unless • A statement that a CMP may a fair administrative process by which the provider can show good cause, as continue to be imposed for continuing providers may appeal CMS’ decisions to determined at § 150.405(b), for failing to violation(s). impose penalties under the timely exercise its right to a hearing. • Payment instructions. requirements established by § 182.40. • A statement of the provider’s right Through various programs, we have D. Medicare Inpatient Prospective to a hearing according to § 182.90 of gained experience with administrative Payment System (IPPS) New COVID–19 subpart D. hearings and other processes to review Treatments Add-On Payment (NCTAP) • A statement that the provider’s CMS’ determinations. That experience for the Remainder of the Public Health failure to request a hearing within 30 includes the processes we recently Emergency (PHE) calendar days of the issuance of the finalized in the CY 2020 Hospital 1. Section 3710 of the CARES Act IPPS notice permits the imposition of the Outpatient Prospective Payment System penalty, and any subsequent penalties Add-On Payment for COVID–19 Patients (OPPS) Price Transparency Final Rule During the PHE pursuant to continuing violations, (84 FR 65524) and corresponding without right of appeal. regulations at 45 CFR part 180, which Section 3710 of the CARES Act CMS may issue subsequent notice(s) requires price transparency for amended section 1886(d)(4)(C) of the of imposition of a CMP, according to the hospitals, and we are aligning the Act to provide for an increase in the aforementioned requirements (in short, procedures for the appeals process here weighting factor of the assigned where investigation reveals there is with those procedures. Therefore, a Diagnosis-Related Group (DRG) by 20 continuing justification), that result provider upon which CMS has imposed percent for an individual diagnosed from the same instance(s) of a penalty under § 182.70 may appeal with COVID–19 discharged during the noncompliance. A provider must pay that penalty in accordance with period of the PHE for COVID–19. To the CMP in full within 60 calendar days §§ 180.100 and 180.110, subpart D, with implement this temporary adjustment, after the date of the notice of imposition conforming edits. Medicare’s claims processing systems of a CMP from CMS. In the event a Generally, under this approach, a apply an adjustment factor to increase provider requests a hearing, under provider upon which CMS has imposed the Medicare Severity-DRG (MS–DRG) subpart D of 45 CFR part 182, the a penalty may request a hearing of that relative weight that would otherwise be provider must pay the amount in full penalty before an Administrative Law applied by 20 percent when within 60 calendar days after the date of Judge (ALJ). The CMS Administrator, at determining IPPS operating payments. a final and binding decision to uphold, his or her discretion, may review in For additional information regarding in whole or in part, the CMP. If the 60th whole or in part the ALJ’s decision. A this add-on payment, including which calendar day is a weekend or a Federal provider against which a final order claims are eligible for the 20 percent holiday, then the timeframe is extended imposing a CMP is entered may obtain increase in the MS–DRG weighting until the end of the next business day. judicial review. factor, please see the Medicare Learning Should a provider elect to appeal the We specify at § 182.80 the procedures Network (MLN) Matters article ‘‘New CMP, and where the CMP is upheld for a provider to appeal the CMP COVID–19 Policies for Inpatient only in part by a final and binding imposed by CMS for its noncompliance Prospective Payment System (IPPS) decision, CMS will issue a modified with the requirements of § 182.40 to an Hospitals, Long-Term Care Hospitals notice of imposition of a CMP, to ALJ, and for the CMS Administrator, at (LTCHs), and Inpatient Rehabilitation conform to the adjudicated finding as his or her discretion, to review in whole Facilities (IRFs) due to Provisions of the specified in § 182.70. or in part the ALJ’s decision. In so CARES Act’’ available on the CMS In the event a CMP is not paid in full doing, we apply the following website at https://www.cms.gov/files/ within 60 days, CMS will follow the conforming modifications to the text: document/se20015.pdf. collections activities set forth in 45 CFR • References to ‘‘hospital’’ are part 30. Generally, CMS will issue a 2. Overview of IPPS New Technology replaced by the term ‘‘provider.’’ We Add-On Payment written demand for payment no later note that the term ‘‘provider,’’ as than 30 days after a debt is delinquent. defined at new 45 CFR 182.20 in this The new medical service or For debts not paid by the date specified rule, may also include hospitals. technology add-on payment policy in the written demand, interest, charged • References to ‘‘standard charge’’ are under the IPPS provides additional at a rate established by the Secretary of replaced by the term ‘‘cash price.’’ payments for cases with relatively high the Treasury, shall accrue from the date We seek comment on the approach we costs involving eligible new medical of delinquency. CMS will transfer debts are establishing for appeals. services or technologies, while 180 days or more delinquent to the We also set forth in § 182.90 the preserving some of the incentives Department of Treasury for collection. consequences for failure of a provider to inherent under an average-based We seek comment on the approach we request a hearing. If a provider does not prospective payment system. The are establishing for imposing a CMP on request a hearing within 30 calendar payment mechanism is based on the a provider noncompliant with the days of the issuance of the notice of cost to hospitals for the new medical regulations set forth in § 182.40. imposition of a CMP described in service or technology. Sections Specifically, we seek comments on the § 182.70(b), CMS may impose the CMP 1886(d)(5)(K) and (L) of the Act length of time allowed between issuance indicated in such notice and may establish a process of identifying and of the request for CAP and the impose additional penalties under ensuring adequate payment for new imposition of a CMP. In addition, we continuing violations according to medical services and technologies seek comments on the amount of the § 182.70(e) without right of appeal. If (sometimes collectively referred to in CMP imposed per day up to the the 30th calendar day is a weekend or this section as ‘‘new technologies’’)

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under the IPPS. The regulations at 42 COVID–19 pandemic, pursuant to COVID–19.30 In order for an item or CFR 412.87 and 412.88 implement these section 564 of the FD&C Act, subject to service to be considered for coverage provisions. terms of any authorization issued under under Medicare Part A or Part B, the As set forth in § 412.88(b)(2), for a that section.27 item or service must fall within at least new technology other than certain There are currently five drug and one benefit category established in the antimicrobial products (for which the biological products with EUAs issued Act. Drugs and biologicals are included maximum add-on payment is 75 during the PHE for COVID–19. In within several such benefit categories. percent), if the costs of a discharge section ‘‘I. Criteria for Issuance of In general, section 1861(t)(1) of the Act involving a new technology exceed the Authorization’’ of the current letters of defines drugs and biologicals to include full DRG payment (including payments authorization for these drug and drugs or biologicals approved for for Indirect Medical Education (IME) biological products, the letters for two of inclusion in certain compendia (except and Disproportionate Share Hospital the products state that based on the for any drugs and biologicals (DSH), but excluding outlier payments)), totality of scientific evidence available unfavorably evaluated therein) or that Medicare will make a new technology to FDA, it is reasonable to believe that are approved by the pharmacy and drug add-on payment equal to the lesser of: the product may be effective in treating therapeutics committee (or equivalent (1) 65 percent of the costs of the new COVID–19, and that, when used under committee) of the medical staff of a technology; or (2) 65 percent of the the conditions described in the hospital furnishing that drug or amount by which the costs of the case authorization, the known and potential biological for use in that hospital. CMS exceed the standard DRG payment. benefits of the product when used to has determined that it is appropriate for For additional information regarding treat COVID–19 outweigh the known CMS to consider drug and biological IPPS new technology add-on payments and potential risks of such products.28[1] products which are authorized for please see the FY 2021 IPPS/LTCH PPS Those two drug and biological products emergency use for COVID–19, with final rule (85 FR 58602 through 58608). are COVID–19 convalescent plasma and letters of authorization, and are used to 3. Overview of the Food and Drug Veklury (remdesivir). treat COVID–19 disease, to fall within Administration (FDA) Coronavirus The current letters of authorization for the drugs and biologicals definition in Treatment Acceleration Program the other three products used in patients section 1861(t)(1) of the Act for with suspected or confirmed COVID–19 Medicare purposes if they are included The FDA has created a special do not indicate that those products are or approved for inclusion in the emergency program for possible treating COVID–19 and instead treat a applicable compendia, or when coronavirus therapies, the Coronavirus disease or condition caused or furnished by a specific hospital if Treatment Acceleration Program. The exacerbated by COVID–19.29 approved for use in that hospital by the program uses every available method to Specifically, the letter of authorization move new treatments to patients as pharmacy and drug therapeutics for REGIOCIT indicates its use as a quickly as possible, while at the same committee (or equivalent committee) of replacement solution in adult patients time finding out whether they are the medical staff of that hospital. More information regarding EUAs for helpful or harmful. The FDA continues in a critical care setting who are being drug and biological products during the to support clinical trials that are testing treated with Continuous Renal PHE for COVID–19 is available on the new treatments for COVID–19 so that Replacement Therapy (CRRT) and for FDA website at https://www.fda.gov/ valuable knowledge about their safety whom regional citrate anticoagulation emergency-preparedness-and-response/ and effectiveness can be gained. (RCA) is appropriate; the letter of mcm-legal-regulatory-and-policy- Additional information regarding this authorization for Fresenius Propoven 2 framework/emergency-use- program is available on the FDA website percent Emulsion indicates its use to authorization#coviddrugs. at https://www.fda.gov/drugs/ maintain sedation via continuous coronavirus-covid-19-drugs/ infusion in patients greater than 16 4. Overview of IPPS Outlier Payments coronavirus-treatment-acceleration- years old who require mechanical ventilation in an ICU setting; and the Section 1886(d)(5)(A) of the Act program-ctap. provides for payments in addition to the One aspect of the program is the letter of authorization for multiFiltrate PRO System and multiBic/multiPlus basic prospective payments for ‘‘outlier’’ issuance by the FDA of EUAs during the cases involving extraordinarily high PHE for COVID–19. On , Solutions indicates its use in delivering CRRT in an acute care environment. costs. To qualify for outlier payments, 2020, pursuant to Section 564(b)(1)(C) of one criterion is that a case must have the FD&C Act, the Secretary of the While COVID–19 convalescent plasma has received an EUA for treating costs greater than the sum of the Department of Health and Human prospective payment rate for the MS– Services (HHS) determined that there is COVID–19 in hospitalized patients, Veklury (remdesivir), as of , DRG, any IME and DSH payments, a PHE that has a significant potential to uncompensated care payments, any new affect national security or the health and 2020, is the only drug or biological product approved by FDA for treating technology add-on payments, and the security of United States citizens living ‘‘outlier threshold’’ or ‘‘fixed-loss’’ abroad, and that involves the virus that 27 26 U.S. Department of Health and Human amount (a dollar amount by which the causes COVID–19. On the basis of Services, Declaration that Circumstances Exist costs of a case must exceed payments in such determination, the Secretary of Justifying Authorizations Pursuant to Section 564(b) order to qualify for an outlier payment). HHS on March 27, 2020, declared that of the Federal Food, Drug, and Cosmetic Act, 21 We refer to the sum of the prospective circumstances exist justifying the U.S.C. 360bbb-3, 85 FR 18250 (, 2020). 28 payment rate for the MS–DRG authorization of emergency use of drugs EUA for COVID–19 convalescent plasma: https://www.fda.gov/media/141477/download; EUA (including the Section 3710 of the and biological products during the for remdesivir: https://www.fda.gov/media/137564/ CARES Act add-on payment if download. applicable), any IME and DSH 26 U.S. Department of Health and Human 29 EUA for REGIOCIT: https://www.fda.gov/ Services, Determination of a Public Health media/141168/download; EUA for Fresenius payments, uncompensated care Emergency and Declaration that Circumstances Propoven 2 percent Emulsion https://www.fda.gov/ Exist Justifying Authorizations Pursuant to Section media/137888/download; EUA for multiFiltrate 30 FDA approval for remdesivir: https:// 564(b) of the Federal Food, Drug, and Cosmetic Act, PRO System and multiBic/multiPlus Solutions: www.accessdata.fda.gov/drugsatfda_docs/ 21 U.S.C. 360bbb-3. February 4, 2020. https://www.fda.gov/media/137520/download. appletter/2020/214787Orig1s000ltr.pdf.

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payments, any new technology add-on urgency of the PHE that a treatment is payments by the ‘‘outlier threshold’’ or payments, and the outlier threshold as new and is used to treat COVID–19 ‘‘fixed-loss’’ amount before outlier the outlier ‘‘fixed-loss cost threshold.’’ during the PHE. Currently, there are payments are made. For FY 2021, the Payments for eligible cases are then only two drug or biological products outlier threshold is approximately made based on a marginal cost factor, that meet this criterion: Veklury $30,000. As discussed previously, the which is a percentage of the estimated (remdesivir) and COVID–19 outlier threshold is adjusted to account costs above the fixed-loss cost convalescent plasma. However, as for local cost variation in determining threshold. The marginal cost factor is 80 additional drug and biological products whether an individual claim is eligible percent for all MS–DRGs except the become available that meet this for outlier payments. As a simplified burn MS–DRGs, where the marginal cost criterion, cases that use those products example for purposes of illustration, if factor is 90 percent. For the complete would become eligible for the NCTAP if the operating costs of a case using a new formula for how an outlier payment is the remaining criteria are met. COVID–19 treatment exceed the computed, we refer the reader to the FY Second, the case must also be eligible operating IPPS payment by $10,000, 2021 IPPS/LTCH PPS final rule (85 FR for the 20 percent increase in the there are no Medicare outlier payments 59043 through 59044). We note, for each weighting factor for the assigned MS– made for this case because the costs are claim, per the formula in the FY 2021 DRG for an individual diagnosed with less than the outlier threshold. IPPS/LTCH PPS final rule, in COVID–19 discharged during the period We believe that in order to further determining whether the claim is of the PHE for COVID–19 under section mitigate any potential financial eligible for an operating outlier payment 3710 of the CARES Act. The primary disincentives for hospitals to provide and/or a capital outlier payment, an purposes of this criterion are to help new COVID–19 treatments, the NCTAP, ‘‘operating outlier threshold’’ and a appropriately identify COVID–19 cases when needed, should function to ‘‘capital outlier threshold’’ are to potentially receive the NCTAP, and partially offset costs that exceed the computed, including application of a ensure for program integrity reasons that Medicare payment, but are less than the geographic adjustment to account for there is a positive COVID–19 laboratory outlier threshold. By partially rather local cost variation. If the case is test documented in the patient’s than fully offsetting these costs, we eligible, an ‘‘operating outlier payment’’ medical record. CMS may conduct post- believe that the NCTAP, similar to the and/or ‘‘capital outlier payment’’ will be payment medical review to confirm the new technology add-on payment policy made for an individual claim. For presence of a positive COVID–19 under the IPPS, preserves some of the additional information regarding IPPS laboratory test and, if no such test is incentives inherent under an average- outlier payments please see the FY 2021 contained in the medical record, the based prospective payment system. One IPPS/LTCH PPS final rule (85 FR 59034 NCTAP will be recouped. way in which the new technology add- through 59041). Third, the operating cost of the case on payment policy accomplishes this must exceed the operating Federal goal is by making the new technology 5. Eligibility Criteria for an IPPS New payment under the IPPS, including the add-on payment equal to the lesser of: COVID–19 Treatments Add-on Payment add-on payment under section 3710 of (1) 65 percent of the costs of the new (NCTAP) for the Remainder of the PHE the CARES Act. The primary purpose of technology; or (2) 65 percent of the We believe that as drugs or biological this criterion is to ensure that the amount by which the costs of the case products become available and are NCTAP is made only when needed. The exceed the standard DRG payment. authorized or approved by FDA for the cost of the case is determined by We believe that the new technology treatment of COVID–19 in the inpatient multiplying the covered charges by the add-on payment calculation provides an setting, it would be appropriate to operating cost-to-charge ratio, the same appropriate conceptual framework for increase the current IPPS payment way it is determined for new technology the NCTAP calculation. In the context of amounts to mitigate any potential add-on payments and operating outlier the urgency of the PHE for COVID–19, financial disincentives for hospitals to payments. however, and the practical and provide these new treatments during the We note that all generally applicable operational challenges of individually PHE. Therefore, effective for discharges statutory and regulatory requirements tailoring the payment calculation to occurring on or after the effective date during the PHE for Medicare payment each new treatment, we believe the of this rule and until the end of the for a particular case must continue to be NCTAP calculation should take into public health emergency, CMS is using met, and that the NCTAP will only be account 65 percent of the amount by the exceptions and adjustment authority available to the extent that the new which the costs of the case exceed the under section 1886(d)(5)(I) of the Act to COVID–19 treatment meets all coverage standard DRG payment, without create a New COVID–19 Treatments requirements under Medicare, including comparison to 65 percent of the costs of Add-on Payment (NCTAP) under the that the use of a drug or biological the new treatment itself. As part of the IPPS for COVID–19 cases that meet product is medically reasonable and approval process for the new technology certain criteria. necessary for that case. No applicable add-on payment for a given new First, the case must include the use of Medicare requirements during the PHE technology, the claims processing a drug or biological product authorized are being waived by the creation of the system is modified and tailored to apply to treat COVID–19 as indicated in NCTAP policy. the new technology add-on payment for section ‘‘I. Criteria for Issuance of that technology using cost and coding Authorization’’ of the current letter of 6. Determination of the IPPS NCTAP information according to the ‘‘lesser of’’ authorization for the drug or biological Amount for the Remainder of the PHE policy described above. In order to more product, or the drug or biological As indicated earlier, the goal of the expeditiously provide payment for cases product must be approved by the FDA NCTAP is to mitigate potential financial meeting the previously described for treating COVID–19. Because the disincentives for hospitals to provide criteria in the context of the urgency of purpose of the NCTAP is to mitigate new COVID–19 treatments. These the PHE, we believe the NCTAP potential financial disincentives for potential financial disincentives are calculation should take into account 65 hospitals to provide new COVID–19 already mitigated in part by the IPPS percent of the amount by which the treatments, this criterion expeditiously outlier payment, but we recognize that costs of the case exceed the standard provides assurance in the context of the the costs of a case must exceed DRG payment for all cases that qualify

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for the NCTAP, without comparison to including the adjustment to the relative security of United States citizens living the costs of the new treatment as under weight under section 3710 of the CARES abroad, and that involves the virus that the ‘‘lesser of’’ policy applicable for the Act. As with the new technology add- causes COVID–19.31 On the basis of new technology add-on payment. on payment and outlier payments, the such determination, the Secretary of We note that a hospital should not costs of the case are determined by HHS on March 27, 2020, declared that seek additional payment on the claim multiplying the covered charges by the circumstances exist justifying the for drugs or biologicals procured or operating cost-to-charge ratio. In authorization of emergency use of drugs provided by a governmental entity to a addition, the NCTAP will not be and biologics during the COVID–19 provider at no cost to the provider to included as part of the calculation of the public health emergency, pursuant to diagnose or treat patients with known or operating outlier payments. section 564 of the FD&C Act, subject to suspected COVID–19, as described in Returning to our simplified example, terms of any authorization issued under the CMS Medicare Claims Processing if the cost of a case using a new COVID– that section.32 Readers should refer to Manual, Pub. 100–04, Chapter 32, 19 treatment exceeds the operating IPPS Section D.3 of this interim final rule Section 67. payment by $10,000 and the operating with comment period for a full CMS will use ICD–10–PCS procedure outlier threshold for the case is for discussion of the Coronavirus Treatment codes XW033E5 (Introduction of purposes of illustration $30,000, the Acceleration Program. Remdesivir Anti-infective into NCTAP would be $6,500 (= $10,000 There are currently five drug and Peripheral Vein, Percutaneous excess cost × 0.65). There would be no biological products with EUAs issued Approach, New Technology Group 5) outlier payments because the excess during the PHE for COVID–19. In and XW043E5 (Introduction of cost of the case ($10,000) does not section ‘‘I. Criteria for Issuance of Remdesivir Anti-infective into Central exceed the operating outlier threshold Authorization’’ of the current letters of Vein, Percutaneous Approach, New for the case ($30,000). authorization for these drug and Technology Group 5) to identify cases As a simplified example of a case that biological products, the letters for two of using remdesivir and ICD–10–PCS qualifies for an operating outlier the products state that based on the procedure codes XW13325 (Transfusion payment, if the cost of a case using a totality of scientific evidence available of Convalescent Plasma new COVID–19 treatment exceeds the to FDA, it is reasonable to believe that (Nonautologous) into Peripheral Vein, operating IPPS payment by $100,000, the product may be effective in treating Percutaneous Approach, New the NCTAP would be equal to the COVID–19, and that, when used under Technology Group 5) and XW14325 maximum NCTAP amount of 65 percent the conditions described in the (Transfusion of Convalescent Plasma of the operating outlier threshold for the authorization, the known and potential (Nonautologous) into Central Vein, case. In this illustrative example, if the benefits of the product when used to Percutaneous Approach, New applicable operating outlier threshold treat COVID–19 outweigh the known Technology Group 5) to identify cases for the claim is $30,000, that amount is and potential risks of such products.33 using convalescent plasma. More $19,500 (equals first $30,000 of the Those drug and biological products are information on the new procedure codes excess cost before the operating outlier COVID–19 convalescent plasma and implemented into the International threshold for the claim is reached × Veklury (remdesivir). Classification of Diseases, Tenth 0.65). In addition, the case would While COVID–19 convalescent Revision, Procedure Coding System receive an outlier payment that is plasma has received an EUA for treating (ICD–10–PCS) in response to the PHE calculated the same way it is currently COVID–19 in hospitalized patients, for COVID–19 is available on the CMS calculated in the absence of the $19,500 Veklury (remdesivir), as of October 22, website at https://www.cms.gov/files/ NCTAP, that is, $56,000 (= ($100,000 2020, is the only drug or biological document/icd-10-ms-drgs-version-372- excess cost¥$30,000 outlier threshold product approved by FDA for treating effective-august-01-2020.pdf. CMS will for the case) * the 0.80 outlier marginal COVID–19. As discussed in Section issue additional operational instructions cost factor). The combined NCTAP and II.D.3 of this interim final rule with on how eligible cases will be identified, outlier payment would be $75,500 comment period, in order for an item or including any new treatments that may (equals the $19,500 enhanced payment service to be considered for coverage become available. + the $56,000 outlier payment). under Medicare Part A or Part B, the We also considered in the item or service must fall within at least determination of the NCTAP amount E. Medicare Outpatient Prospective one benefit category established in the that we did not want to inadvertently Payment System (OPPS) Separate Act. Drugs and biologicals are included reduce the IPPS operating outlier Payment for New COVID–19 Treatments within several such benefit categories. payments that the hospital would have Policy for the Remainder of the Public In general, section 1861(t)(1) of the Act otherwise received for a costly COVID– Health Emergency (PHE) 19 case given that these outlier defines drugs and biologicals to include payments already help to mitigate 1. FDA Coronavirus Treatment drugs or biologicals approved for potential financial disincentives for Acceleration Program inclusion in certain compendia (except hospitals to provide new COVID–19 The FDA has created a special 31 U.S. Department of Health and Human treatments. Therefore, we do not believe emergency program to facilitate the Services, Determination of a Public Health the calculation of the operating outlier development of coronavirus therapies, Emergency and Declaration that Circumstances payments should be impacted by the the Coronavirus Treatment Acceleration Exist Justifying Authorizations Pursuant to Section NCTAP. Program. One aspect of the program is 564(b) of the Federal Food, Drug, and Cosmetic Act, Taking these factors into account, the issuance by the FDA of EUAs during 21 U.S.C. 360bbb-3. February 4, 2020. 32 U.S. Department of Health and Human CMS is setting the NCTAP amount for the PHE for COVID–19. On February 4, Services, Declaration that Circumstances Exist a case that meets the NCTAP eligibility 2020, pursuant to Section 564(b)(1)(C) of Justifying Authorizations Pursuant to Section 564(b) criteria equal to the lesser of: (1) 65 the FD&C Act, the Secretary of the of the Federal Food, Drug, and Cosmetic Act, 21 percent of the operating outlier Department of Health and Human U.S.C. 360bbb-3, 85 FR 18250 (April 1, 2020). 33 EUA for remdesivir: https://www.fda.gov/ threshold for the claim or (2) 65 percent Services (HHS) determined that there is media/137564/download; EUA for COVID–19 of the amount by which the costs of the a PHE that has a significant potential to convalescent plasma: https://www.fda.gov/media/ case exceed the standard DRG payment, affect national security or the health and 141477/download.

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for any drugs and biologicals in which case separate payment would 3. Separate Payment Under the OPPS for unfavorably evaluated therein) or that not be made for these products. New COVID–19 Treatments for the are approved by the pharmacy and drug Under our C–APC policy, which we Remainder of the PHE for COVID–19 therapeutics committee (or equivalent adopted beginning in CY 2015, we Although we do not expect that many committee) of the medical staff of a designate a service described by a beneficiaries would both receive a hospital furnishing that drug or HCPCS code assigned to a C–APC as the primary C–APC service and a drug or biological for use in that hospital. CMS primary service when the service is biological for treating COVID–19, we has determined that it is appropriate for nonetheless believe that as drugs or CMS to consider drug and biological identified by OPPS status indicator ‘‘J1’’. When such a primary service is biologicals become available and are products which are authorized for authorized or approved for the emergency use for COVID–19, with reported on a hospital outpatient claim, with certain exceptions, we make treatment of COVID–19 in the outpatient letters of authorization, and are used to setting, it would be appropriate to treat COVID–19 disease, to fall within payment for all other items and services reported on the hospital outpatient mitigate any potential financial the drugs and biologicals definition in disincentives for hospitals to provide claim as being integral, ancillary, 1861(t)(1) of the Act for Medicare these new treatments during the PHE for supportive, dependent, and adjunctive purposes if they are included or COVID–19. Therefore, effective for to the primary service (hereinafter approved for inclusion in the applicable services furnished on or after the compendia, or when furnished by a collectively referred to as ‘‘adjunctive effective date of this rule and until the specific hospital if approved for use in services’’) and representing components end of the PHE for COVID–19, CMS is that hospital by the pharmacy and drug of a complete comprehensive service (78 creating an exception to its OPPS C– therapeutics committee (or equivalent FR 74865 and 79 FR 66799). Payments APC policy to ensure separate payment committee) of the medical staff of that for adjunctive services are packaged into for new COVID–19 treatments that meet hospital. the payments for the primary services. certain criteria. Under this exception, 2. OPPS Comprehensive-Ambulatory This results in a single prospective any new COVID–19 treatment that Payment Classification (C–APC) Policy payment for each of the primary, meets the two criteria below will, for the comprehensive services based on the remainder of the PHE for COVID–19, To date, no drug or biological product costs of all reported services at the claim always be separately paid and will not has an EUA for the treatment of patients level. Items included in the packaged be packaged into a C–APC when it is with COVID–19 in the outpatient payment provided in conjunction with provided on the same claim as the setting. However, because treatment of the primary service also include all primary C–APC service. Note that this COVID–19 is rapidly evolving, we drugs, biologicals, and separate payment will result in an believe it is important to ensure that radiopharmaceuticals, regardless of cost, additional copayment of 20 percent of separate payment is available under the except those drugs with pass-through the cost of the new COVID–19 OPPS for new drug and biological payment status and self-administered treatment, up to the amount of the products (including blood products) drugs, unless they function as packaged inpatient deductible. that receive an EUA for treating COVID– supplies (78 FR 74868 through 74869 CMS has identified two criteria for 19 in the outpatient setting or are and 74909 and 79 FR 66800). Thus, COVID–19 treatments to receive this approved by the FDA for treating under our current policy, payment for exception. First, the treatment must be COVID–19 in the outpatient setting, or a drug or biological product (which drugs or biological products with an where a drug or biological product could include a blood product) emergency authorization or approved to approved under an existing EUA is authorized to treat COVID–19, as treat COVID–19 in the outpatient setting authorized for use in settings other than indicated in section ‘‘I. Criteria for the inpatient setting. As part of that would be packaged into payment for a Issuance of Authorization’’ of the letter process, we expect to include the primary C–APC service when billed on of authorization for the drug or addition of new codes describing those the same claim as that service. biological product, or the drug or treatments as soon as practicable, after Currently, there are 67 C–APCs in the biological product must be approved by their availability, to ensure efficient and CY 2020 OPPS, with payments ranging the FDA for treating COVID–19. Because timely beneficiary access to those from approximately $1,000 to $37,000. the purpose of this exception is to treatments. We anticipate that most Most C–APCs are for surgical or other mitigate potential financial drugs and biological products intensive procedures, which we would disincentives for hospitals to provide authorized for use in treating COVID–19 expect most hospital outpatient new COVID–19 treatments, this in the outpatient setting would be departments would not perform on a criterion expeditiously provides separately paid under our standard patient that has an active case of assurance in the context of the urgency OPPS payment policy because drugs COVID–19. However, observation of the PHE for COVID–19 that a and biological products are typically services can also be paid through the treatment is new and is used to treat assigned separate Ambulatory Payment ‘‘Comprehensive Observation Services’’ COVID–19 disease during the PHE for Classification payment status indicators C–APC (C–APC 8011), which packages COVID–19. in the OPPS unless they meet one of the Second, the EUA for the drug or payment for qualifying extended criteria for packaging, which, with the biological product (which could include exception of drug or biological products assessment and management a blood product) must authorize the use billed with a Comprehensive encounters. It is possible that future of the product in the outpatient setting Ambulatory Payment Classification (C– COVID treatments that are authorized or or not limit its use to the inpatient APC) service, we do not anticipate that approved for use in the outpatient setting, or the product must be approved drugs or biological products approved setting might be administered to by the FDA to treat COVID–19 disease or authorized to treat COVID–19 would patients under observation while the and not limit its use to the inpatient meet. However, these products could be provider determines if the patient needs setting. packaged into a C–APC when provided to be admitted to the hospital for We note that during the PHE for on the same claim as a C–APC service, COVID–19. COVID–19 this new exception to the C–

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APC packaging policy would apply to prospective adjustment to the OPPS under such plan (or waiver) during the all drug and biological products that budget neutrality calculations through period beginning on such date of meet both of these criteria. As of the future rulemaking. enactment [March 18, 2020] and ending date of issuance of this interim final rule the last day of the month in which the F. Temporary Increase in Federal there are two drug or biological [PHE for COVID–19] ends shall be Medicaid Funding products that meet the first criterion treated as eligible for such benefits (Veklury (remdesivir) and COVID–19 1. Background through the end of the month in which convalescent plasma), but neither of Section 6008 of the FFCRA, as such emergency period ends unless the these products is authorized or amended by section 3720 of the CARES individual requests a voluntary approved for use in the outpatient Act, provides a temporary 6.2 termination of eligibility or the setting and, as a result, no product percentage point increase to each individual ceases to be a resident of the meets the second criterion. qualifying state and territory’s Federal State[.]’’ We also note that all generally Medical Assistance Percentage (FMAP) The language in section 6008(b)(3) of applicable statutory and regulatory under section 1905(b) of the Act the FFCRA is somewhat ambiguous. requirements for Medicare payment (‘‘temporary FMAP increase’’). This CMS issued guidance on this condition under the OPPS must continue to be temporary FMAP increase is effective through frequently asked questions met, and that OPPS payment will only beginning , 2020 and could (FAQs) posted on Medicaid.gov on be available to the extent that the new , 2020, , 2020, and June extend through the last day of the 35 COVID–19 treatment meets all coverage calendar quarter in which the PHE for 30, 2020. However, our existing requirements under Medicare, including COVID–19, including any extensions, interpretation (discussed in section that the use of a drug or biological terminates, if the state claims the FMAP II.F.2 of this preamble) is not the only product is medically reasonable and increase in that quarter (we refer herein possible interpretation that could be necessary for the patient. No applicable to the entire period where the FMAP made. As the PHE for COVID–19 Medicare requirements during the PHE increase is potentially applicable as the continued, and states requested are being waived by the creation of this ‘‘increased FMAP period’’). increased flexibility for managing their C–APC exception. To qualify for the temporary FMAP programs, we revisited our existing 4. Effects of This Exception on the OPPS increase in a given quarter, states must interpretation. Seeking to balance the Budget Neutrality Calculation meet the four conditions described in beneficiary protections in our existing subsection (b) of section 6008 of the interpretation with the state flexibility As we noted in Section II.E.2, we FFCRA during that quarter. Three of that could be afforded through an believe it would be a fairly rare these conditions (described at section alternative interpretation, this IFC occurrence that an outpatient 6008(b)(1), (2), and (4) of the FFCRA) establishes a blended approach as department would perform a C–APC could extend through the end of the discussed below. procedure on a beneficiary being treated increased FMAP period, if the state for COVID–19 because most C–APCs are 2. CMS’s Existing Interpretation of claims the increased FMAP through the for surgical or other intensive Section 6008(b)(3) of the FFCRA end of the quarter in which the PHE for procedures and we would expect most COVID–19 ends. They are: (a) The state CMS first provided an interpretation hospital outpatients departments would must maintain eligibility standards, of section 6008(b)(3) for implementation not perform outpatient surgery on a methodologies, or procedures that are by states through FAQs issued in April patient that has an active case of 2020. Our most recent interpretation COVID–19. While it is possible that no more restrictive than what the state had in place as of January 1, 2020; (b) provided that to receive the increased future COVID–19 treatments that are FMAP under the FFCRA, a state must authorized or approved for use in the the state may not charge premiums that exceed those that were in place as of keep beneficiaries enrolled in Medicaid, outpatient setting might be administered 34 if they were enrolled on or after March to patients under observation while the January 1, 2020; and (c) the state must cover, without the imposition of cost 18, 2020, with the same amount, provider determines if the patient needs duration, and scope of benefits. It also to be admitted to the hospital for sharing, testing services and treatments for COVID–19, including vaccines, provided that states could not subject COVID–19, it is our expectation that this such beneficiaries to any increase in hypothetical situation would not specialized equipment, and therapies. The fourth condition, which is cost sharing or beneficiary liability for happen frequently. Because we believe institutional services or other long-term a new COVID–19 treatment will rarely described at section 6008(b)(3) of the FFCRA, extends through the last day of services and supports (LTSS) during be provided on the same claim as a this time period. This interpretation primary C–APC service, we believe new the month in which the PHE for COVID–19 ends. This condition COVID–19 treatments used in the 35 provides that a state may not receive the See: outpatient setting will be separately • COVID–19 Frequently Asked Questions (FAQs) paid under current policy the vast temporary FMAP increase if ‘‘the [s]tate for State Medicaid and Children’s Health Insurance majority of the time. As a result, we do fails to provide that an individual who Program (CHIP) Agencies, available at https:// is enrolled for benefits under [the www.medicaid.gov/state-resource-center/ not believe it is necessary that we make downloads/covid-19-faqs.pdf (Updated , an adjustment to OPPS budget Medicaid state] plan (or waiver) as of the date of enactment of this section 2020) neutrality calculations at this time to • Families First Coronavirus Response Act— account for this new exception, as any [March 18, 2020] or enrolls for benefits Increased FMAP FAQs available at https:// budgetary effect of this new exception is www.medicaid.gov/state-resource-center/ 34 Section 3720 of the CARES Act added a new downloads/covid-19-section-6008-faqs.pdf likely to be de minimis. If, once new subsection (d) to section 6008 of the FFCRA in (Updated April 13, 2020) COVID–19 treatments are being order to provide states which have increased • Families First Coronavirus Response Act provided in the outpatient setting, the premiums for any Medicaid beneficiaries above the (FFCRA), Public Law 116–127 Coronavirus Aid, claims data indicates that these amounts in effect on January 1, 2020, with a 30-day Relief, and Economic Security (CARES) Act, Public grace period to restore premiums to amounts no Law 116–136 Frequently Asked Questions (FAQs) treatments are being provided on the greater than those in effect as of January 1 without available at https://www.medicaid.gov/state- same claim as a C–APC more frequently jeopardizing the state’s eligibility for the temporary resource-center/downloads/covid-19-section-6008- than we expected, we can make a 6.2 percentage point FMAP increase. CARES-faqs.pdf (Posted April 13, 2020)

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protects both beneficiary eligibility and meet the level-of-care requirements or In practice, the only cost-controlling access to medically necessary services. other requirements for that waiver, the measure available to states under our Under this interpretation, if a state state must maintain the beneficiary’s existing interpretation is reducing receives information about a enrollment in the HCBS waiver. Under provider rates to the minimum level beneficiary’s change in circumstances this interpretation, states are not permitted under section 1902(a)(30)(A) that would make the beneficiary required to provide services that do not of the Act. Such rate cuts, combined ineligible for Medicaid, the state may meet the state plan amount, duration, with a substantially lower volume of not terminate that beneficiary’s and scope criteria for a benefit (such as visits since the beginning of the eligibility until the end of the month in medical necessity). However, as a pandemic,37 could put some providers which the PHE for COVID–19 ends, condition for receiving the temporary out of business. This could undermine except in cases where the beneficiary FMAP increase, the state must ensure the solvency of critical provider voluntarily disenrolls or is no longer a that a beneficiary can continue to access networks and their ability to serve resident of the state. Further, if the state the benefits package that was available beneficiaries in the future, particularly receives information that would make a to that beneficiary as of March 18, 2020 in rural areas where health care beneficiary eligible for a different (or a later date within the PHE) through workforce shortages may already exist. the end of the month in which the PHE eligibility group with lesser benefits, 3. Alternative Interpretation of Section for COVID–19 ends. greater cost sharing, or increased 6008(b)(3) of the FFCRA beneficiary liability, the state may not States have expressed concern that transition that beneficiary to the new our existing interpretation of section CMS’s existing interpretation of eligibility group but must maintain the 6008(b)(3) of the FFCRA makes it section 6008(b)(3) of the FFCRA is not beneficiary’s enrollment in the current challenging for them to manage their the only possible, reasonable eligibility group until the end of the programs effectively and still qualify for interpretation of that provision. The month in which the PHE for COVID–19 the increased Federal financial language in this section could also ends.36 participation, in frustration of one reasonably be interpreted to mean only In protecting access to medically purpose of section 6008 of the FFCRA that states must maintain the enrollment necessary services pursuant to this to provide additional support to state of beneficiaries who enrolled in the interpretation, states must maintain Medicaid programs in their response to state’s Medicaid program as of or after current coverage in the state plan, the COVID–19 pandemic. States made March 18, 2020, through the end of the including alternative benefit plans clear to CMS that this interpretation, month in which the PHE ends, but not (ABPs), and must also maintain current coupled with the prohibition on the specific benefits package they were coverage under any waivers and section adopting more restrictive eligibility receiving at that time. In other words, 1115 demonstrations. For example, standards, methodologies, or procedures under this alternative interpretation, to states may not implement any new under section 6008(b)(1) of the FFCRA, fulfill the requirement in section restrictions such as a reduction in the would impede the routine, orderly 6008(b)(3) of the FFCRA with respect to number of covered visits or a prior transition of beneficiaries between a beneficiary who becomes ineligible for authorization requirement. Beneficiary eligibility groups, and could lead to enrollment in his current Medicaid coverage may not be reduced on an significant backlogs in redeterminations eligibility group, states would either (a) individual basis either. For example, if and appeals after the PHE for COVID– transition the beneficiary to another a beneficiary has reached age 21 and 19 ends. group for which he is eligible and enroll would no longer be eligible for the Early States also noted that our existing him for the benefits provided to that and Periodic Screening, Diagnostic, and interpretation severely limits state eligibility group, or (b) retain the Treatment (EPSDT) benefit, the state flexibility to control program costs in beneficiary’s enrollment in the original must continue to provide EPSDT the face of growing budgetary eligibility group, if he did not meet the services to the beneficiary when constraints and developing fiscal eligibility criteria for any other group, and maintain the benefits provided to medically necessary, through the end of challenges during the emergency period. that group. Under this alternative the month in which the PHE for For example, it freezes post-eligibility treatment-of-income (PETI) calculations interpretation, a state would be required COVID–19 ends. Further, if a for institutionalized beneficiaries to move a beneficiary who becomes beneficiary is enrolled in a home and regardless of changes in circumstances. eligible for another Medicaid eligibility community-based services (HCBS) States have pointed out that a group during the period in which waiver program authorized under beneficiary receiving HCBS through a section 6008(b)(3) of the FFCRA applies section 1915(c) of the Act, and the waiver approved under section 1915(c) into that new group, no matter how individual is determined to no longer of the Act who is subject to the PETI limited the benefits package is for the rules and who subsequently moves into new group. We refer to this alternative 36 See Question B.12 of the Families First Coronavirus Response Act—Increased FMAP FAQs an institution would be entitled to interpretation as the ‘‘enrollment available at https://www.medicaid.gov/state- retain the higher personal needs interpretation.’’ resource-center/downloads/covid-19-section-6008- allowance allowed for individuals Under the enrollment interpretation, faqs.pdf; Question F.27 of the Families First participating in the relevant waiver, states claiming the 6.2 percentage point Coronavirus Response Act (FFCRA), Public Law temporary FMAP increase would be 116–127 Coronavirus Aid, Relief, and Economic even though the beneficiary’s personal Security (CARES) Act, Public Law 116–136 needs would be far lower once in the permitted to make programmatic Frequently Asked Questions posted on April 13, institution. The aggregate effects of this changes, such as changes to the medical 2020, available at https://www.medicaid.gov/state- interpretation could result in a necessity criteria or utilization control resource-center/downloads/covid-19-section-6008- procedures in determining coverage for CARES-faqs.pdf; and Questions relating to substantial increase in the state Continuing Coverage under Section 6008 of the Medicaid program’s cost for the needed benefits; elimination of optional benefits Families First Coronavirus Response Act in the institutional services as beneficiaries are COVID–19 Frequently Asked Questions (FAQs) for not contributing as much toward the 37 Source: Ateev Mehrotra et al., The Impact of State Medicaid and Children’s Health Insurance cost of their care as they would be in the the COVID–19 Pandemic on Outpatient Visits: Program (CHIP) Agencies available at https:// Practices Are Adapting to the New Normal www.medicaid.gov/state-resource-center/ absence of the FFCRA 6008(b)(3) (Commonwealth Fund, June 2020). https://doi.org/ downloads/covid-19-faqs.pdf requirement. 10.26099/2v5t-9y63

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coverage; increases in cost-sharing institution like the special income level planning-only coverage through a responsibilities (except with respect to group described at 42 CFR 435.236. section 1115 demonstration) would be testing services and treatments for The enrollment interpretation would required to transfer women who do not COVID–19 per section 6008(b)(4) of the require states to move a beneficiary who qualify for a full-benefit Medicaid FFCRA); or changes to the PETI loses eligibility under one Medicaid eligibility group into family planning- methodology. For example, states would eligibility group and becomes eligible in only coverage if they meet the eligibility be permitted to establish a limit on the a second Medicaid eligibility group into requirements for the family planning- number of visits permitted for a given the second eligibility group, even if the only group or demonstration. service and to require a copayment for second eligibility group confers lesser The enrollment interpretation of a service in accordance with Medicaid benefits or results in increased financial section 6008(b)(3) of the FFCRA would statute and regulations. These liability for the beneficiary. However, as make it more challenging for some programmatic changes would not with our existing interpretation, under beneficiaries to access medically jeopardize the state’s receipt of the the enrollment interpretation states necessary services, including services temporary FMAP increase. would not be permitted to terminate a related to the COVID–19 pandemic. A In considering this interpretation, we beneficiary’s eligibility unless the beneficiary transferred to the family note that Congress expressly individual requested such termination planning group following the end of her conditioned receipt of the temporary or was no longer a state resident. If a postpartum period would continue to FMAP increase on a state’s temporarily beneficiary loses eligibility under one have access to provider visits for family not implementing ‘‘more restrictive’’ Medicaid eligibility group and is not planning and outpatient drugs and ‘‘eligibility standards, methodologies, or eligible for another group, in order to supplies related to those visits, but she procedures’’ in section 6008(b)(1), on claim the temporary FMAP increase, the would no longer have access to testing temporarily not imposing higher state must maintain the beneficiary’s services and treatment for COVID–19, premiums in section 6008(b)(2), and on enrollment in the current group until pursuant to CMS’s interpretation of covering COVID–19 testing and the end of the month in which the PHE section 6008(b)(4) of the FFCRA, which treatment services without cost-sharing for COVID–19 ends. Like the is discussed above in section II.B. In in section 6008(b)(4). However, programmatic changes discussed addition, she would lose access to Congress did not legislate with the same previously, individual beneficiary inpatient and outpatient hospital express clarity in section 6008(b)(3) eligibility changes would not jeopardize services, prescription drugs, and other with respect to states’ ability or inability receipt of the temporary FMAP increase. Medicaid-covered services that are to reduce the amount, duration, and In most cases, transferring a unrelated to family planning. scope of benefits other than COVID–19 beneficiary from one eligibility group to Beneficiaries with certain chronic testing and treatment services or to another would not result in a significant conditions like diabetes and sickle cell eliminate optional benefits. Further, change in available benefits. With a few disease are at higher risk for severe while Congress expressly prohibited exceptions, Medicaid is considered to illness from the virus that causes states from imposing cost sharing on be minimum essential coverage (MEC) COVID–19.38 Under the enrollment testing services and treatments for as defined in section 5000A(f) of the interpretation, individuals who lose COVID–19 in section 6008(b)(4) of the Internal Revenue Code of 1986 (‘‘Code’’) eligibility for a group that offers MEC FFCRA, Congress did not expressly and implementing regulations at 26 CFR may be transitioned to a limited benefit provide in section 6008(b)(3) for any 1.5000A–2. Certain Medicaid eligibility eligibility group, in a state that offers limitation on cost sharing, or on states’ groups, however, such as the optional such coverage, in which they would no ability to modify cost sharing or eligibility group for individuals infected longer have access to the benefits beneficiaries’ liability for the cost of with tuberculosis (described at 42 CFR needed to manage their chronic other services (e.g., in accordance with 435.215), provide only limited benefits conditions. Not only would this the PETI rules set forth in 42 CFR part pursuant to the matter following section negatively impact the beneficiary who 435, subpart H, and 42 CFR 435.832 for 1902(a)(10)(G) of the Act. This optional loses comprehensive Medicaid coverage beneficiaries receiving institutional coverage of tuberculosis and as a result of this interpretation, but it services or other long-term services and tuberculosis-related services is excepted could also undermine states’ COVID–19 supports who are subject to the PETI from the definition of MEC at 26 CFR response efforts during the public health rules). 1.5000A–2(b)(2)(ii) and transferring a emergency. Under the enrollment interpretation, beneficiary from an eligibility group that states would be required to make provides MEC to the eligibility group for 4. Adopting a Blended Approach individual beneficiary eligibility individuals infected with tuberculosis As we considered changing our changes short of disenrollment from would result in a significant reduction interpretation of section 6008(b)(3) of Medicaid entirely. For example, states in available benefits. the FFCRA, CMS examined the would be required to make changes to Another example of non-MEC implications of both the existing and a beneficiary’s eligibility to reflect a coverage available through Medicaid is alternative interpretations on each of the change in income, or a change related to the optional eligibility group limited to major Medicaid stakeholder groups. age, pregnancy status, need for LTSS or family planning and related services at Based on that analysis, this IFC adopts other eligibility factors. A change of 42 CFR 435.214, which also provides a blended approach. It is intended to service, such as moving from only a limited benefits package pursuant balance the interests of states, providers, participation in an HCBS waiver to the matter following section and beneficiaries, without materially authorized under section 1915(c) of the 1902(a)(10)(G) of the Act, and which is undermining their ability to address the Act into an institution or vice versa, excluded from MEC at 26 CFR 1.5000A– challenges presented by COVID–19. would also require a change in 2(b)(2)(i). If the enrollment eligibility for a beneficiary enrolled in interpretation was adopted, following 38 Centers for Disease Control and Prevention, an eligibility group specific to HCBS the postpartum period for coverage of Coronavirus Disease 2019 (COVID–19); People with Certain Medical Conditions; accessed 10/08/2020 at recipients, such as the group described pregnant women at 42 CFR 435.116, https://www.cdc.gov/coronavirus/2019-ncov/need- at 42 CFR 435.217, or an eligibility states that cover the optional family extra-precautions/people-with-medical- group for individuals living in an planning group (or that provide family conditions.html.

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Looking first at states, the the same time, it would expand state implementation of the conditions in circumstances facing each state during flexibility to make cost-saving decisions FFCRA section 6008(b)(3) and the PHE for COVID–19 are different. that could reduce beneficiaries’ administration of the state plan. These States have sent a strong message to coverage below what they had access to parameters are also expected to help CMS that they need more flexibility to as of or after March 18, 2020. Under the ensure that states are determining make choices that meet their unique enrollment interpretation, some eligibility, and providing care and needs. They have made clear that our beneficiaries would be transitioned from services, in a manner that is consistent existing interpretation of section MEC to non-MEC coverage, which may with the best interests of beneficiaries, 6008(b)(3) of the FFCRA has interfered not include testing services and as described in section 1902(a)(19) of with their ability to implement cost- treatment for COVID–19 pursuant to the Act. That is because CMS is giving saving decisions in the face of CMS’s interpretation of FFCRA section states less flexibility to reduce increasing beneficiary enrollment and 6008(b)(4). Ensuring access to testing beneficiaries’ coverage under this declining state revenues. The and treatment, along with care for the blended approach than might be enrollment interpretation would allow chronic health conditions that place available to states under the enrollment states to impose coverage limitations beneficiaries at higher risk for COVID– interpretation, in an effort to help that reduce spending and allow for 19, is important for fighting the protect beneficiaries’ access to better management of state programs pandemic. potentially necessary medical care during the PHE for COVID–19. More Seeking to balance the needs of each during the period in which the FFCRA flexibility in managing their programs stakeholder group, both in fighting the 6008(b)(3) requirement applies. We could help states to stretch scarce pandemic and ensuring long-term therefore believe this blended approach financial resources over the long term, program sustainability, this IFC adopts balances the interests of all stakeholders including after the PHE for COVID–19 a blended approach to interpreting consistent with the statute. ends, and that could ultimately benefit section 6008(b)(3) of the FFCRA. This This IFC adds a new subpart G, both providers and beneficiaries. blended approach adopts the state Temporary FMAP Increase During the Supporting states and providers fighting flexibility available through the Public Health Emergency for COVID–19, the pandemic is consistent with the enrollment interpretation—allowing to 42 CFR part 433, including a new protections and the various provider states to make programmatic changes to § 433.400. Section 433.400(a) describes relief funds established by Congress in benefits and cost sharing and to the statutory basis for this provision, the FFCRA, the CARES Act, and the transition individual beneficiaries while § 433.400(b) provides definitions PPPHCEA. between eligibility groups with differing specific to this subpart. As described in While the enrollment interpretation of benefit packages—while also detail below, § 433.400(c) requires section 6008(b)(3) of the FFCRA may be establishing parameters to prevent states, as a condition for receiving the the preferred option for states, we beneficiaries from losing access to temporary FMAP increase, to maintain recognize that it could negatively comprehensive coverage, consistent beneficiary enrollment in an eligibility impact certain provider types. Under with our existing interpretation, through group that provides one of three tiers of the enrollment interpretation, states the end of the month in which the PHE coverage through the end of the month could eliminate optional benefits. For for COVID–19 ends. in which the PHE for COVID–19 ends, example, a state could cut its optional This blended approach is expected to except under the circumstances dental benefit, and dentists in that state give states more flexibility, beyond what specified in paragraph (d). This would lose Medicaid reimbursement. is available under our existing provision generally does not require CMS’s existing interpretation, however, interpretation, to manage their Medicaid states to provide the exact same (or leaves states with little ability to manage programs. This is consistent with greater) amount, duration, and scope of program costs other than by cutting section 1902(a)(4) of the Act, which medical assistance, or maintain the cost- provider rates to the fullest extent requires the state plan to provide for sharing or PETI liability for a particular permitted under section 1902(a)(30)(A) such methods of administration as are beneficiary at the same (or lower) level of the Act. We believe such rate cuts necessary for the proper and efficient that was applicable to the beneficiary as represent a far more significant threat to operation of the plan. CMS is also of March 18, 2020 or subsequent date of providers and their continued exercising its general rulemaking initial enrollment during the PHE. availability to beneficiaries. Under the authority under sections 1102 and Section 433.400 is effective immediately enrollment interpretation, states may be 1902(a)(19) of the Act to establish upon display of this rule. CMS’ previous less likely to reduce provider rates, parameters under which states must interpretation, as described in section which could benefit both providers and operate when they exercise the II.F.2. of this preamble, continues to beneficiaries. flexibility that CMS is providing with apply from the beginning of the quarter Considering the impact on respect to compliance with section up to the date that this IFC is displayed. beneficiaries, our existing interpretation 6008(b)(3) of the FFCRA. provided the strongest protections for The parameters established by this 5. Maintaining Enrollment in the Same beneficiary access to medically IFC will help to ensure that states are Tier of Coverage necessary care during the PHE. It determining eligibility, and providing As discussed, we believe that ensured that beneficiaries remained care and services, in a manner that is interpreting FFCRA section 6008(b)(3) enrolled in Medicaid and that no new consistent with the simplicity of only to require continued enrollment in coverage restrictions were imposed. administration, as described in section a state’s Medicaid program (even if Every Medicaid beneficiary who had 1902(a)(19) of the Act. Under this benefits are strictly limited), could have access to MEC and to testing services blended approach, CMS is giving states significant negative consequences for and treatment for COVID–19 as of or a wider degree of flexibility to effectuate both beneficiaries and efforts to combat after March 18, 2020 would continue to enrollment transitions during the PHE the COVID–19 pandemic. Some have access to these services under the for COVID–19, which could decrease beneficiaries may transition from existing interpretation. The enrollment backlogs in redeterminations and medical assistance that qualifies as MEC interpretation would also protect appeals following the PHE for COVID– to non-MEC coverage, and some may beneficiary enrollment in Medicaid. At 19, thereby simplifying state even lose access to COVID–19 testing

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services and treatment. CMS has not have not received a determination of of Medicaid coverage that meets the interpreted section 6008(b)(4) of the eligibility by the state under the state definition of MEC, as defined in section FFCRA to require state Medicaid plan and therefore are not considered to 5000A(f) of the Code and implementing programs to cover COVID–19 testing be validly enrolled for continuous regulations at regulation at 26 CFR services and treatment for beneficiaries coverage under section 6008(b)(3) of the 1.5000A–2. Under § 433.400(c)(2)(i)(A), whose Medicaid eligibility is limited by FFCRA. for beneficiaries whose Medicaid statute or under existing section 1115 In order to receive the temporary coverage as of or after March 18, 2020 demonstration authority to coverage for FMAP increase (defined at § 433.400(b)) meets the definition of MEC, the state care and services that are for a specific for any quarter in which it is available, must generally continue to provide (non-COVID–19-related) condition, a state must meet the requirements Medicaid coverage that meets the disease or purpose and that would not described in paragraph (c). As described definition of MEC throughout the period otherwise include COVID–19 testing in § 433.400(c)(1)(i), for the quarter in in which this rule applies. This means and treatment services. which this rule becomes effective, states that if a state determines a beneficiary Consistent with the blended approach would be expected to meet the ineligible for the group in which he or to interpreting section 6008(b)(3) of the requirements described in she is currently enrolled, which FFCRA that is described above, and § 433.400(c)(2) and (3) only from the provides MEC, and finds the beneficiary consistent with section 1902(a)(4) and date of display through the end of the eligible for another group that also (a)(19) of the Act, we are requiring states quarter. CMS’ previous interpretation, provides MEC, the state would to ensure that beneficiaries who were as described in section II.F.2. of this transition the beneficiary to the new validly enrolled for benefits as of or preamble and in the FAQs cited therein, eligibility group. In contrast, if the after March 18, 2020 with access to continues to apply from the beginning beneficiary lost eligibility for a group minimum essential coverage retain of the quarter up to the date this rule is that provides MEC, but gained eligibility access to minimum essential coverage, effective. For all quarters following the for coverage that does not meet the and to ensure that beneficiaries with effective date of this rule, states would definition of MEC, the state may not access to testing services and treatment be expected to meet the requirements of move the beneficiary to the new group for COVID–19 maintain access to those § 433.400(c) for the entirety of the or demonstration but must instead services. quarter in order to claim the temporary maintain the beneficiary’s access to We believe it is reasonable to interpret FMAP increase. coverage meeting the definition of MEC the term ‘‘enrolled for benefits’’ in Section 433.400(c)(2) requires states during the period in which the rule section 6008(b)(3) to mean validly to maintain the enrollment of all applies, except as discussed below. enrolled, such that those who were beneficiaries who were validly enrolled For example, the state must transition erroneously enrolled are not to be on or after March 18, 2020. Paragraphs a beneficiary enrolled in the eligibility considered ‘‘enrolled for benefits’’ for (c)(2)(i), (ii), and (iii) of 433.400 group for children under age 19 at 42 purposes of FFCRA section 6008. establish safeguards for the maintenance CFR 435.118 to the adult group Therefore, we define ‘‘validly enrolled’’ of enrollment. For beneficiaries who described at 42 CFR 435.119 when the at § 433.400(b) to mean that the were not validly enrolled during this beneficiary reaches age 19, provided beneficiary was enrolled in Medicaid period, and whom the state is therefore that the state covers this group and the based on a determination of eligibility, permitted to disenroll, the state must beneficiary meets the eligibility including during the retroactive provide advance notice of termination requirements of the group. That is eligibility period, and that the and fair hearing rights in accordance because the medical assistance provided beneficiary was not erroneously granted with 42 CFR 435.917 and 42 CFR part under the eligibility group for children eligibility at the point of application or 431, subpart E, when terminating under age 19 includes full state plan last redetermination (if such last coverage. benefits with no cost sharing, which redetermination was completed prior to Consistent with the Secretary’s meets the definition of MEC, and the March 18, 2020) because of: (1) Agency rulemaking authority under section medical assistance offered under the error; or (2) fraud (as evidenced by a 1102 of the Act and section 1902(a)(19) adult group may include a somewhat fraud conviction) or abuse (as of the Act, which provides for such different set of benefits through the determined following the completion of safeguards as are needed to ensure that state’s ABP, and may include cost an investigation pursuant to 42 CFR care and services are provided in a sharing for certain services, but it also 455.15 and 455.16) attributed to the manner consistent with the best meets the definition of MEC. This beneficiary or the beneficiary’s interests of beneficiaries, § 433.400(c)(2) transition would therefore be representative which was material to the establishes three tiers of Medicaid permissible under § 433.400(c)(2)(i). determination of eligibility. Terminating coverage. These coverage tiers will help In contrast, a state may not transition the eligibility of beneficiaries who are to ensure that beneficiaries protected a beneficiary from the eligibility group not validly enrolled as defined at under section 6008(b)(3) of the FFCRA for children under age 19 or the adult § 433.400(b) will not impact a state’s in states claiming the temporary FMAP group, both of which provide MEC, to ability to claim the temporary FMAP increase, who no longer meet eligibility a limited benefit group that does not increase. We note that prior to requirements for the initial eligibility provide MEC, such as the family termination, however, the state must group in which they are enrolled but planning group at 42 CFR 435.214, complete a redetermination consistent who become eligible under a different which covers only family planning and with 42 CFR 435.916 and provide the eligibility group or who lose Medicaid family planning-related services. As beneficiary with advance notice and the eligibility entirely, do not experience a described further in § 433.400(c)(2)(iv), opportunity for a fair hearing consistent reduction in covered benefits that if a beneficiary receiving tier 1 coverage with 42 CFR part 431, subpart E. would be inconsistent with section no longer meets the eligibility Additionally, individuals receiving 1902(a)(19) of the Act, or with our requirements for the original group in medical assistance during a interpretation of sections 6008(b)(3) and which he or she was enrolled, and the presumptive eligibility period in (4) of the FFCRA. beneficiary does not meet the accordance with section 1902(a)(47) of The first tier of coverage, under requirements for any other eligibility the Act and 42 CFR part 435, subpart L, paragraph (c)(2)(i) of § 433.400, consists groups with tier 1 coverage, the state

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must continue to provide the medical section 6008(b)(4) of the FFCRA to through the pregnant women group assistance offered under the eligibility require states to cover COVID–19 testing until the end of the month in which the group in which the beneficiary was and treatment services for those PHE for COVID–19 ends, in order to eligible on or after March 18, 2020. beneficiaries. However, other Medicaid qualify for the temporary FMAP At § 433.400(c)(2)(i)(B), we establish a beneficiaries receive a relatively robust increase, as described at variation on this requirement for set of benefits, such as pregnancy- § 433.400(c)(2)(iv). For example, a beneficiaries who have coverage related services described in the matter woman receiving non-MEC pregnancy meeting the definition of MEC as of or following section 1902(a)(10)(G) of the related coverage that includes coverage after March 18, 2020, and whom the Act, which would include testing of testing services and treatments for state subsequently determines are services and treatment for COVID–19, COVID–19 could not be transitioned to eligible for coverage under a Medicare including vaccines, specialized coverage of only family planning Savings Program eligibility group. The equipment, and therapies, during the services at the end of the postpartum Medicare Savings Program is defined at period when FFCRA section 6008(b)(4) period. § 433.400(b) to include the eligibility applies in a state, but which does not The third tier, described at groups described at section qualify as MEC in all states. § 433.400(c)(2)(iii), includes coverage 1902(a)(10)(E)(i), (iii), and (iv) of the Section 433.400(c)(2)(ii) of this IFC that is not MEC and that also does not Act. For such beneficiaries, the state provides that states must continue to cover testing services and treatment for satisfies the requirement described in provide Medicaid coverage that COVID–19, including vaccines, paragraph (c)(2) of this section if it includes coverage of COVID–19 testing specialized equipment, and therapies, furnishes the medical assistance services and treatments, including under CMS’s interpretation of FFCRA available through the Medicare Savings vaccines, specialized equipment, and section 6008(b)(4). Coverage under tier 3 Program, because the coverage that therapies, to beneficiaries who had may include coverage for the eligibility beneficiary receives under the Medicare access to coverage in tier 2 as of or after group limited to family planning program qualifies as MEC. Thus, for March 18, 2020. Thus, states must described at 42 CFR 435.214 or the example, a beneficiary enrolled in the transition beneficiaries who lose eligibility group for individuals with adult group as of or after March 18, eligibility for tier 2 coverage but gain tuberculosis described at 42 CFR 2020, may be transitioned to a Medicare access to MEC coverage in tier 1 or to 435.215. Coverage through an existing Savings Program eligibility group, such other coverage in tier 2 to the new family planning demonstration or other as the qualified Medicare beneficiaries eligibility group or demonstration, but limited benefit section 1115 (QMB) group described at section they may not transition such demonstration may also be included in 1902(a)(10)(E)(i) of the Act, when the beneficiaries to coverage that does not tier 3 if it does not cover COVID–19 beneficiary reaches age 65, if the include access to testing services and testing and treatment. If a beneficiary beneficiary meets the eligibility treatment for COVID–19. This loses eligibility for coverage meeting the requirements of the QMB group. Such a interpretation is consistent with the tier 3 description during the period in beneficiary would receive Medicaid requirement for states claiming the which the FFCRA section 6008(b)(3) coverage of Medicare premiums and temporary FMAP increase to provide requirement applies, and the beneficiary Medicare-related cost sharing through coverage for testing services and gains eligibility for a group that the QMB group. However, unless that treatments for COVID–19, as described provides coverage in tier 1 or tier 2, beneficiary was also eligible for another at section 6008(b)(4), and with CMS’s then, under § 433.400(c)(2)(iii), the state full-benefit Medicaid eligibility group, interpretation of that requirement. must transfer the beneficiary into that all of the beneficiary’s health care Consistent with § 433.400(c)(2)(ii), a new eligibility group as coverage in services would be provided through state must transition a beneficiary from those tiers is more robust than coverage Medicare and the beneficiary would not tier 2 coverage to tier 1 coverage if that in tier 3. receive any other Medicaid covered beneficiary becomes eligible for The coverage in tier 3 differs from the services. While the medical assistance coverage that qualifies as MEC. For coverage in tier 1, which is always provided under the adult group differs example, a state must transition a considered MEC and the coverage in tier from the medical assistance provided woman receiving tier 2 postpartum 2, which always includes testing under the QMB group, the beneficiary coverage under the pregnant women services and treatment for COVID–19. maintains access to MEC. Therefore, the group described at 42 CFR 435.116 (in The coverage available to a beneficiary state may transition the beneficiary from a state in which such coverage is not in tier 3 is more limited and may vary the adult group to a Medicare Savings considered MEC) to the adult group widely from one group or demonstration Program group. described at 42 CFR 435.119 at the end to the next. Coverage limited to family The second tier of coverage, which is of the postpartum period, because planning and family planning-related described at § 433.400(c)(2)(ii), consists coverage under the adult group qualifies services is significantly different from of coverage that is not defined as MEC as MEC and is therefore included in tier coverage in a limited-benefit section but that is robust enough to include 1. If this postpartum beneficiary was not 1115 demonstration that focuses, for access to coverage of both testing eligible for any eligibility groups with example, on preventing the progression services and treatment for COVID–19 tier 1 coverage, such as in a state that of a specific disease. Therefore, the under CMS’s interpretation of FFCRA does not cover the adult group, but was requirement in § 433.400(c)(2)(iii) for section 6008(b)(4). Not all Medicaid eligible for tier 2 coverage, such as tier 3 coverage differs somewhat from coverage qualifies as MEC, and the non- through a limited benefit section 1115 the requirements in § 433.400(c)(2)(i) MEC coverage provided to beneficiaries demonstration providing non-MEC and (ii) for tiers 1 and 2. If a beneficiary can vary greatly. As noted previously, coverage that includes access to testing becomes ineligible for the tier 3 some beneficiaries’ coverage is limited services and treatment for COVID–19, eligibility group or demonstration in by statute or existing section 1115 the state must move her to that which he or she is enrolled and demonstration authority to a very coverage. If such a beneficiary is not becomes eligible for another eligibility narrow range of services that would not eligible for any other tier 1 or tier 2 group or demonstration with coverage include COVID–19 testing or treatment coverage, the state must continue to that is also within tier 3, the state must services, and CMS has not interpreted provide the medical assistance available continue to provide the coverage

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available through the eligibility group or disability-related poverty level group that states may make programmatic demonstration for which the beneficiary described at section changes to coverage, cost sharing, and was eligible as of or after March 18, 1902(a)(10)(A)(ii)(X) of the Act, and the beneficiary liability without violating 2020, unless the beneficiary requests a beneficiary reports a change in the requirements for receiving the voluntary termination to transition to resources that would result in temporary FMAP increase, provided the new eligibility group or ineligibility for this group, if the that such changes do not violate the demonstration, as discussed below. beneficiary is not eligible for coverage in individual beneficiary protections at Transitioning a beneficiary from one any other Medicaid eligibility group, the § 433.400(c)(2) or the requirements eligibility group offering tier 3 coverage state would continue to provide that under section 6008(b)(4) of the FFCRA to another eligibility group offering tier individual with the coverage available to cover COVID–19 testing and 3 coverage would not satisfy the to beneficiaries enrolled in the age and treatment services without cost-sharing. requirement in § 433.400(c)(2)(iii). disability-related poverty level group. As described at § 433.400(c)(3), states We note that beneficiaries enrolled in The requirement at § 430.400(c)(2)(iv) may generally make changes to benefits certain limited-benefit state plan also applies in cases where a state finds offered under the state plan (as allowed eligibility groups may be eligible for a beneficiary ineligible on a procedural under relevant provisions of the Act) or coverage in the optional COVID–19 basis, such as a failure to respond to a a section 1115 demonstration. For testing group authorized under section request for additional information, with example, section 6008(b)(3) of the 1902(a)(10)(A)(ii)(XXIII), and such an exception related to residency FFCRA does not prohibit a state from individuals can be enrolled in both described at § 430.400(d)(3). For eliminating an optional benefit from its limited benefit groups. Section 3716 of example, if a state receives information state plan. Therefore, a state could the CARES Act amended section from quarterly wage data, which eliminate dental services for individuals 1902(ss) of the Act to establish that indicates that a child’s household age 21 and above, and still comply with individuals eligible for certain optional income exceeds the income standard for section 6008(b)(3) of the FFCRA. Note eligibility groups, such as the eligibility the eligibility group for children under that under section 1905(r)(5) of the Act, group limited to family planning and age 19 (described at 42 CFR 435.118), as part of the mandatory EPSDT benefit, related services described at the child is not eligible on another basis, states must provide beneficiaries under 1902(a)(10)(A)(ii)(XXI) of the Act, are and the beneficiary’s family does not age 21 with all necessary health care, considered ‘‘uninsured’’ for purposes of respond to a request from the state for diagnostic services, treatment, and other eligibility under the optional COVID–19 additional information, the child may be measures described in section 1905(a) of testing group and therefore may obtain determined ineligible on a procedural the Act, to correct or ameliorate defects COVID–19 testing coverage under that basis. In this case, through the end of and physical and mental illnesses and group in addition to coverage under the the month in which the PHE for conditions discovered by EPSDT other optional eligibility group. COVID–19 ends, the state would screening services, whether or not such In addition, beneficiaries in each continue to provide the child with the services are covered under the state benefit tier retain the right to request a same coverage provided to beneficiaries plan. However, states need not maintain voluntary transition to a different enrolled in the eligibility group for EPSDT benefits for beneficiaries who eligibility group (provided that they children under age 19. If the beneficiary turn 21 in order to comply with the meet the applicable eligibility is subsequently determined eligible for terms of section 6008(b)(3) of the requirements), even if such transition a different eligibility group that FFCRA. results in a change in the individual’s provides the same tier of coverage, in Additionally, states are permitted to benefit package that would not this case tier 1, the state would transfer change the scope of benefits provided to otherwise satisfy the conditions of this the beneficiary to the new eligibility beneficiaries without violating the rule, such as a transition from an group. requirements of section 6008(b)(3) for eligibility group with coverage in tier 1 CMS is available for technical claiming the temporary FMAP increase, to an eligibility group with coverage in assistance to help states ensure that all as long as they comply with otherwise tier 3 or a transition from one tier 3 beneficiaries retain coverage in either applicable Medicaid law, including group to another tier 3 group. Such a the same tier or in a more robust tier of section 6008(b)(4) of the FFCRA. For transition is permissible under the coverage when their eligibility changes example, section 6008(b)(3) of the exception at § 433.400(d)(1)(i), as in a manner that would ordinarily result FFCRA does not prohibit states from described at § 433.400(d)(3)(i), in which in a transition between eligibility applying service authorization criteria, a beneficiary may request a voluntary groups. including for services authorized under termination of eligibility, and would not section 1915(c) of the Act, in 6. Changes to Benefits, Cost Sharing, impact the state’s ability to claim the determining the amount, duration, or and PETI temporary FMAP increase. scope of coverage a beneficiary is Section 42 CFR 430.400(c)(2)(iv) Section 433.400 of this IFC allows entitled to receive under the state’s specifies that for any beneficiary who is states, during the period when section program. Section 440.230(b) still applies validly enrolled and receiving medical 6008(b)(3) of the FFCRA applies, to as a limit on state flexibility. That assistance on or after March 18, 2020, move a beneficiary from one eligibility regulation requires that each Medicaid and who is determined ineligible for group to another when the beneficiary service must be sufficient in amount, Medicaid prior to the last day of the becomes ineligible for one group and duration, and scope to reasonably month in which the PHE for COVID–19 eligible for another group, as long as the achieve its purpose. ends, except as provided in paragraph coverage provided under the new group In considering optional changes to (d), a state meets the requirements of is within the same tier of coverage coverage, states may wish to avoid § 430.400(c)(2)(i), (ii), or (iii) by (applicable to tier 1 and tier 2 coverage service authorization changes that lead continuing the provide the same only) or a beneficiary may also be to more individuals being placed in coverage that the individual would have moved to a more generous tier of institutional or congregate settings, as received absent the determination of coverage than the coverage available to these settings have had a ineligibility. For example, if a the beneficiary on or after March 18, disproportionate share of COVID–19 beneficiary is enrolled in the age and 2020. Section 433.400(c)(3) specifies cases and deaths. We also note that

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regardless of the flexibility provided at CFR 431.211 preclude states from eligibility group with coverage in tier 1 § 433.400(c)(3), states retain their reducing benefits or increasing cost to an eligibility group with coverage in obligations to provide services and sharing or beneficiary liability tier 3, at the beneficiary’s request. Such supports in the ‘‘most integrated retroactively. Additionally, 42 CFR a transition would not impact the state’s setting’’ under the integration mandate 440.230(b) limits states’ flexibility to ability to claim the temporary FMAP of Title II of the Americans with reduce the amount, duration, or scope of increase because the change resulted Disabilities Act (ADA), as interpreted by benefits; that regulation requires that from a beneficiary request for voluntary the Supreme Court in Olmstead v. L.C., each Medicaid service must be termination from the original eligibility 527 U.S. 581 (1999) (hereafter sufficient in amount, duration, and group. ‘‘Olmstead’’),39 to avoid unjustified scope to reasonably achieve its purpose. Additionally, as described at institutionalization or segregation. If the § 433.400(d)(3)(ii), individuals who are 7. Exceptions to Maintaining Enrollment elimination of an optional benefit identified as receiving benefits in more results in or places an individual with Section 433.400(d) of this IFC than one state via a data match with the a disability at risk of unjustified describes the exceptions to the Public Assistance Reporting Information institutionalization or segregation, it continuous enrollment requirement in System (PARIS) interstate matching may be a violation of the state’s § 433.400(c)(2). Section 6008(b)(3) of the service in accordance with § 435.945(d) obligations under the ADA and FFCRA specifies that a beneficiary’s and who fail to respond to a request for Olmstead.40 States’ Olmstead Medicaid enrollment may be terminated information to verify their residency in obligations do not confer Medicaid if the beneficiary requests a voluntary the reasonable period permitted by the authority or create Medicaid obligations termination of eligibility or the state, consistent with § 435.952(c)(2)(iii), where they do not otherwise exist; states beneficiary is no longer a resident of the are generally considered to no longer be may choose to (and in some cases would state. These exceptions are described in residents of the state for purposes of be required to) use funds outside of or § 433.400(d)(1)(i) and (ii). Because a section 6008(b)(3) of the FFCRA, in addition to Medicaid to comply with beneficiary who dies is no longer a state provided that the state takes all Olmstead responsibilities. resident, § 433.400(d)(1)(iii) also available reasonable measures to Finally, states may generally establish provides an exception for deceased determine state residency prior to or increase cost sharing (consistent with beneficiaries. termination. These measures include, sections 1916 and 1916A of the Act, Section 433.400(d)(2) provides that but are not limited to, reviewing implementing regulations at 42 CFR states that have elected the option under existing information in the beneficiary’s 447.50 through 447.90, and the state section 1903(v)(4) of the Act to provide record to validate state residency, coverage to certain lawfully residing plan), and increase beneficiary checking available state electronic data children and/or pregnant women, must obligations under the PETI rules, and sources such as the Department of limit the provision of services for these still comply with FFCRA section Motor Vehicles records or other state beneficiaries to services necessary for 6008(b)(3). However, states should also benefit programs, and coordinating with treatment of an emergency medical comply with FFCRA 6008(b)(4) if they agencies in the other state(s) in which condition, as defined in section are claiming the temporary FMAP the PARIS interstate match identified 1903(v)(3) of the Act, when they no increase. For example, a state may the beneficiary as receiving benefits to longer meet the criteria at section increase the liability of individuals determine the state in which the 1903(v)(4) of the Act. This is because receiving Medicaid coverage for individual is a resident for purposes of section 1903(v) of the Act prohibits the institutional services under the state provision of FFP for otherwise eligible Medicaid eligibility. If the state is plan through otherwise permissible non-citizens who are not in a unable to verify the beneficiary’s reductions in their standard personal satisfactory immigration status, except continued residency in the state because needs allowances or family allowances. as provided under paragraphs (2) the beneficiary fails to respond to In addition, they may transfer a (authorizing FFP for services necessary requests for additional information and beneficiary from one program furnishing to treat an emergency medical the state’s alternative efforts cannot HCBS (for example, a waiver program condition) and (4) (relating to coverage verify the beneficiary’s continued authorized under section 1915(c) of the of certain lawfully residing children residency in the state through other Act) to another as a beneficiary’s health and/or pregnant women) of section sources, that beneficiary’s Medicaid status and level of care changes. 1903(v) of the Act. enrollment may be terminated in Prior to reducing benefits or Finally, § 433.400(d)(3) clarifies the accordance with § 435.400(d)(1)(ii). increasing cost sharing or beneficiary exceptions at § 433.400(d)(1). As noted Such an individual will be considered liability a state must provide proper above, § 433.400(d)(1)(i) provides an a non-resident for purposes of section advance notice and comply with other exception for beneficiaries who request 6008(b)(3) of the FFCRA until such time applicable statutory and regulatory a voluntary termination. Section as the state has information verifying requirements. In particular, the advance 433.400(d)(3)(i) provides that this residency. If, after termination, the state notice requirements that apply under 42 exception applies not only to obtains information that verifies beneficiaries who request that their residency, the state must reinstate the 39 Under title II of the ADA and Olmstead, the individual’s eligibility back to the date unjustified isolation of individuals with disabilities Medicaid coverage be terminated in its constitutes unlawful discrimination. States are entirety, but also to beneficiaries who of termination. required to provide community-based treatment request a voluntary transition to a G. Updates to the Comprehensive Care where such treatment would be appropriate, the different eligibility group (provided that affected person does not oppose such treatment, for Joint Replacement (CJR) Model, and the treatment can be reasonably they meet the applicable eligibility Performance Year (PY) 5 During the accommodated. requirements), even if such transition COVID–19 Public Health Emergency 40 See DOJ’s Statement of the Department of results in a change in the individual’s (PHE) Justice on Enforcement of the Integration Mandate benefit package that would not of Title II of the Americans with Disabilities Act 1. Background and Olmstead v. L.C., Question 9, updated February otherwise satisfy the conditions of 25, 2020, available at: https://www.ada.gov/ § 433.400(c)(2). For example, a state may Under the authority of section 1115A olmstead/q&a_olmstead.htm. transition a beneficiary from an of the Act, through notice-and-comment

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rulemaking, the Innovation Center (MSAs) 41 a one-time option to choose target price determined for that episode established the CJR model in a final rule whether to continue their participation under § 510.300. titled ‘‘Medicare Program; in the model through 31, Additionally, in the , 2020 Comprehensive Care for Joint 2020 (that is, continue their Federal Register (85 FR 32460), CMS Replacement Payment Model for Acute participation through PY5). An interim published a proposed rule titled Care Hospitals Furnishing Lower final rule with comment period was also ‘‘Medicare Program; Hospital Inpatient Extremity Joint Replacement Services’’ issued in conjunction with the Prospective Payment Systems for Acute published in the , 2015 December 2017 final rule (82 FR 57092) Care Hospitals and the Long-Term Care Federal Register (80 FR 73274) (referred in order to address the need for a policy Hospital Prospective Payment System to as the ‘‘November 2015 final rule’’). to provide some flexibility in the and Proposed Policy Changes and Fiscal Year 2021 Rates; Quality Reporting and The CJR model, which was determination of episode costs for Medicare and Medicaid Promotion implemented on April 1, 2016, aims to providers located in areas impacted by extreme and uncontrollable Interoperability Programs Requirements support better and more efficient care for Eligible Hospitals and Critical for beneficiaries undergoing the most circumstances. This extreme and uncontrollable circumstances policy Access Hospitals: (hereinafter referred common inpatient surgeries for to as the FY 2021 IPPS/LTCH proposed Medicare beneficiaries: Hip and knee was adopted as final in the final rule (83 FR 26604) we published in the June 8, rule). In the FY 2021 IPPS/LTCH replacements (also called lower 2018 Federal Register, titled ‘‘Medicare proposed rule (85 FR 32510), we extremity joint replacements or LEJR). Program; Changes to the Comprehensive solicited comment on the effect of the This model tests bundled payment and Care for Joint Replacement Payment proposal to create new MS–DRG 521 quality measurement for an episode of Model (CJR): Extreme and and MS–DRG 522, the effect this care associated with hip and knee Uncontrollable Circumstances Policy for proposal would have on the CJR model replacements to encourage hospitals, the CJR Model.’’ and whether to incorporate MS–DRG physicians, and post-acute care In the , 2020 Federal 521 and MS–DRG 522, if finalized, into providers to work together to improve Register (85 FR 10516), we published the CJR model’s proposed extension to the quality and coordination of care the proposed rule titled ‘‘Medicare , 2023. from the initial hospitalization through Program: Comprehensive Care for Joint Through this IFC we are recovery. All related care covered by Replacement Model Three-Year implementing four changes to the CJR Medicare Parts A and B within 90 days Extension and Changes to Episode model. These are: (1) Extending of hospital discharge from the LEJR Definition and Pricing’’ (hereinafter performance year 5 an additional 6 procedure is included in the episode of referred to as the ‘‘February 2020 months to provide for continuity of care. During the first CJR model proposed rule’’). Among other changes, model operations with the same scope performance period, the CJR model this proposed rule proposed to add while we continue to consider required hospitals located in the 67 three additional performance years to comments received on our proposal to extend the model to performance years MSAs selected participation to the CJR model (i.e., performance years 6 6 through 8 and adopt other changes to participate in the model through through 8). the model; (2) making changes to the December 31, 2020 unless the hospital In the April 6, 2020 Federal Register (85 FR 19230), we published an interim reconciliation process for PY5 to allow was an episode initiator for an LEJR for two periods and to enable more episode in the risk-bearing phase of final rule with comment period (IFC) titled ‘‘Medicare and Medicaid frequent receipt of reconciliation reports Models 2 or 4 of the Bundled Payments by participants; (3) making a technical for Care Improvement (BPCI) initiative. Programs; Policy and Regulatory Revisions in Response to the COVID–19 change, retroactive to , 2020, Hospitals located in one of the 67 MSAs to ensure that the model continues to that participated in Model 1 of the BPCI Public Health Emergency’’ (hereinafter referred to as the ‘‘April 2020 IFC’’). In include the same inpatient Lower initiative, which ended on December 31, Extremity Joint Replacement (LEJR) 2016, were required to begin the April 2020 IFC, to account for the impact of the PHE for COVID–19 on CJR procedures, despite the adoption of new participating in the CJR model when MS–DRGs to describe those procedures; participant hospitals, we extended PY5 their participation in the BPCI model and (4) making changes to the extreme through March 31, 2021, and adjusted ended. and uncontrollable circumstances the extreme and uncontrollable policy for COVID–19 to adapt to an In the , 2017 Federal circumstances policy to account for increase in CJR episode volume and Register, we published another final COVID–19 by specifying that all renewal of the PHE, while providing rule (82 FR 57066), titled ‘‘Medicare episodes with a date of admission to the protection against financial Program; Cancellation of Advancing anchor hospitalization that is on or consequences of COVID–19 after the Care Coordination Through Episode within 30 days before the date that the extreme and uncontrollable Payment and Cardiac Rehabilitation emergency period (as defined in section circumstances policy no longer applies. Incentive Payment Models; Changes to 1135(g) of the Act) begins or that occurs Comprehensive Care for Joint through the termination of the 2. Extension of Performance Year 5 to Replacement Payment Model: Extreme emergency period (as described in September 30, 2021 and Uncontrollable Circumstances section 1135(e) of the Act), actual We are implementing a 6-month Policy for the Comprehensive Care for episode payments are capped at the extension to CJR performance year (PY) Joint Replacement Payment Model’’ 5 such that the model will now end on 41 (referred to as the ‘‘December 2017 final Metropolitan Statistical Area (MSA) means a September 30, 2021. In the February rule’’), that implemented revisions to core-based statistical area associated with at least one urbanized area that has a population of at least 2020 proposed rule, we proposed to the CJR model, including giving rural 50,000. MSAs included in the CJR model are extend the CJR model by adding three and low volume hospitals selected for available in the December 2017 final rule available performance years (PY6 through 8), participation in the CJR model as well at https://www.federalregister.gov/documents/2017/ from January 1, 2021 to December 31, as those hospitals located in 33 of the 12/01/2017-25979/medicare-program-cancellation- of-advancing-care-coordination-through-episode- 2023, to revise target prices, to change 67 metropolitan statistical areas payment-and-cardiac. the definition of an episode of care to

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include outpatient procedures for Total and stability in model operations. In the and asking that we extend PY5 by 12 Knee Arthroplasty and Total Hip event the three-year extension is months instead, not just the 3 months in Arthroplasty, as well as to revise other finalized, participant hospitals would be the April 2020 IFC. In addition, sections of 42 CFR part 510.42 In in a worse position if PY 5 was not commenters noted that though state and response to the PHE for COVID–19, in extended to September 30, 2021 because local guidelines have laid out a process the April 2020 IFC we extended PY 5 an participant hospitals would have made for regions and facilities to determine additional 3 months to end on March operational choices in reliance on the when to re-open elective procedures, 31, 2021 rather than on December 31, model ending on March 31, 2021 and the progression of COVID–19 could 2020 as finalized in November 2015 then have to adjust to model changes on impact elective procedures well into final rule. top of the significant burden of 2021. We appreciate commenters’ While we continue to consider the managing COVID–19 treatment and request to extend PY 5 by 12 additional addition of performance years to the under COVID–19 safety protocols and model and other changes proposed in utilization changes. Overall, this means months because of the impact COVID– the February 2020 proposed rule, we a nine-month extension from the 19 has had on LEJR procedures. We also do not want to create a disruption original conclusion of the model as observe that COVID–19 has had an to the model by allowing the model to finalized in the November 2015 final impact on CJR procedures from end on March 31, 2021, which could be rule (80 FR 73274), which had February 2020 to August 2020. Table 1 disruptive to hospitals and patient care established that the model would end depicts recent Medicare claims data during the PHE if it is still ongoing at on December 31, 2020 with no new comparing February to August of 2019 that time. Implementing an additional episodes initiating after , 2020. and February to August of 2020. These six months of PY5, so that PY5 now We received several comments on the numbers reflect episode volume for each ends on September 30, 2021, provides April 2020 IFC supporting the policy to month, accounting for any CJR episode participant hospitals additional relief extend PY5 an additional three months 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 ending on or after January 1, 2023 or PY 5 to a total of 21 months, from providing an additional 6 months January 1, 2024, respectively. January 1, 2020 through September 30, beyond what we adopted in the April 2021 would mean that participant 3. Additional Reconciliations for 2020 IFC provides participant hospitals hospitals would experience a 21-month Performance Year 5 relief from COVID–19 challenges. gap between the PY4 final reconciliation Therefore, we are implementing an Currently, following the end of each in June of 2020 and initial PY 5 additional 6-month extension of CJR PY performance year, CMS determines reconciliation in early 2022. We believe 5 and amending the provisions at 42 actual episode payments and calculates this significant gap is problematic CFR 510.2 and 510.200(a) to reflect this the amount of a reconciliation payment because participant hospitals gain extension. or repayment amount, as described in important feedback from their annual We note that in our February 2020 42 CFR 510.305. Each performance year reconciliation reports that they can use proposed rule to extend and modify the is reconciled twice. The first to gauge their quality performance and CJR model through PYs 6 to 8 (CMS– reconciliation calculation process efforts at cost-savings. These annual 5529–P), we proposed PY 6 would begins after a 2-month period of claims reports also facilitate the relationships comprise all CJR episodes ending on or runout, while the final reconciliation that participant hospitals have after January 1, 2021 and on or before calculation process begins after a 14- established with clinicians and other December 31, 2021. However, since we month period of claims runout. The entities with whom they coordinate care are amending PY 5 such that it initial reconciliation of a given and/or have gainsharing arrangements. comprises all CJR episodes ending on or performance year is conducted Further, not having an initial after January 1, 2020 and on or before concurrently with the final reconciliation for PY5 until early 2022 September 30, 2021, we seek comment reconciliation of the previous is not consistent with the model design on the duration of PY 6, if finalized. In performance year, and the resulting goal of reconciling one time a year and particular, we seek comment on the amounts are netted against one another netting against final reconciliation potential for PYs 6 through 8 to remain for one annual reconciliation payment amounts from the prior year. Therefore, 12-month performance years and each or repayment amount, as set forth in 42 we believe there is good cause to begin with episodes ending on or after CFR 510.305. The initial reconciliation conduct two initial, and two final, October 1 each year. We also seek process typically begins in late February reconciliations of PY5. The first initial comment on increasing the duration of of the calendar year following the reconciliation will apply to the first 12 proposed PY 6 to 15 months. Under this performance year, with reports and months of PY5 in order to maintain alternative, PY 6 would comprise all reconciliation amounts issued in June. consistency with the 12 month CJR episodes ending on or after October Final reconciliation for the performance reconciliation cycles for previous PYs 1, 2021 and on or before December 31, year is issued the following June. 2–4 (we note that PY 1 was 9 months 2022; PY 7 and PY 8 would remain 12 Absent modification to the rather than 12 months), and the second months and each begin with episodes reconciliation process, the extension of initial reconciliation will apply to the

42 For proposed changes to the CJR Model in Replacement Model Three Year Extension and Changes to Episode Definition and Pricing’’ See 85 ‘‘Medicare Program: Comprehensive Care for Joint FR 10516.

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remaining 9 months of PY5. To initial reconciliation calculation for subsets 5.1 and 5.2 quality data minimize confusion, we will refer to performance year subset 5.2 with the collection overlap with the effective these two subsets of PY5 as performance timing of the subsequent reconciliation dates of the COVID–19 waiver 43 that year subset 5.1and 5.2, respectively. calculation for performance year subset provided reporting exemptions for The initial reconciliation of 5.1. While alignment with the hospitals participating in quality performance year subset 5.1 will occur performance year subset 5.1 subsequent reporting programs, so we will use fourteen months after the start of PY5, reconciliation calculation is the primary quality data reported before and after which is the same timeline as would reason for this delay in the performance the effective dates of the COVID–19 have occurred PY5 under the December year subset 5.2 initial reconciliation, it waiver, for those quality measures to 2017 final rule. After the usual 2-month is also necessary to allow time to receive which the waiver applied. period of claims runout, the initial certain input files to perform the initial reconciliation for performance year reconciliation calculation, including The final reconciliation calculation subset 5.1 episodes will begin in late standardized claims files and quality for performance year subset 5.2 will February of 2021 using 12 months of data. These data are generally not occur one year after the initial claims from CY 2020 to calculate available more than a few weeks prior reconciliation of performance year reconciliation payments, with the to the usual reconciliation process start subset 5.2. Although we will use claims resulting amounts netted against the date in late February. Therefore, the data that were available 14 months after results of the concurrent PY4 final reconciliation process will occur on the the end of performance year subset 5.2 reconciliation calculation when we same schedule as PY 1 through 4 and for the subsequent reconciliation (as set issue reports and reconciliation performance year subset 5.1, with the forth in 42 CFR 510.305(i)(1)), as with amounts to participants in June 2021. reconciliation report available one year the initial reconciliation, we will not Participants can expect to receive their after the reports from the previous year’s begin the subsequent reconciliation 2021 reconciliation reports on reconciliation. calculation process until 17 months approximately the same schedule as in We note that, as part of the separate after the end of performance year subset previous model years. reconciliation calculation processes for 5.2. We would begin the final The nine additional months of PY 5 performance year subsets 5.1 and 5.2, reconciliation calculation for (performance year subset 5.2) will be we will calculate a separate Composite performance year subset 5.2 in late reconciled one full calendar year after Quality Score (CQS) for each of February 2023 with reconciliation the reconciliation of PY 4 final/ performance year subsets 5.1 and 5.2, payment amounts and reports issued in performance year subset 5.1 initial. We including a separate set of quality June, because input files that are will use claims data for the initial improvement points and quality required for the final reconciliation will reconciliation of performance year performance points for each not be available until 17 months after subset 5.2 that reflect a 2-month period performance year subset. In order to the end of performance year subset 5.2. of claims runout (as set forth in 42 CFR conduct separate CQS calculations for In particular, we need to receive the 510.305(e)(1)(i)), as we have for PY 1– each time period, we are amending 42 reconciliation results from Accountable 4 and performance year subset 5.1. In CFR 510.400 to indicate that the short, performance year subset 5.2 will required data submissions that Care Organizations (ACOs) that overlap run from January 1, 2021 through previously applied to PY 5 will now with CJR in order to conduct the ACO September 30, 2021. Consistent with apply to performance year subset 5.1, overlap calculation. Since we cannot using two months of claims run out, we and we are adding a required data state with confidence that we will have will pull claims for the initial submission for performance year subset access to those data prior to the normal reconciliation in December 2021. 5.2. These additional requirements will reconciliation process start date in late However, we will not reconcile reflect the timeframe of performance February 2023, we will perform the performance year subset 5.2 until late year subset 5.2, but will otherwise reconciliation calculation at the same February 2022 along with the final parallel the requirements for time of year that we have performed reconciliation for performance year performance year subset 5.1, and will previous reconciliations. As noted subset 5.1. This means that we will not not require an increased amount of data above, we will conduct the final begin reconciliation calculation for for performance year subset 5.2 as reconciliation of performance year performance year subset 5.2 until five compared to performance year subset subset 5.2 independently. Table 2 months after the end of performance 5.1. We recognize that some of the illustrates the timelines for performance year subset 5.2 in order to align the timeframe for both performance year year subsets 5.1 and 5.2.

TABLE 2—TIMELINES FOR PERFORMANCE YEARS 4 AND 5

Performance Initial Subsequent Reconciliation year Performance reconciliation reconciliation amount (PY) period calculation start calculation start (+/¥)

4 ...... 01/01/2019 to 12/31/2019 2 months after 12/31/2019: 14 months after 12/31/ Net PY3 and PY4 rec- Late February 2020. 2019: Late February onciliation amounts. 2021. 5 (two periods) ...... 01/01/2020 to 09/30/2021. Subset 5.1 ...... 01/01/2020 to 12/31/2021 2 months after 12/31/2020: 14 months after 12/31/ Net PY4 and PY5.1 rec- Late February 2021. 2020: Late February onciliation amounts. 2022.

43 https://www.cms.gov/files/document/covid-ifc- 3-8-25-20.pdf.

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TABLE 2—TIMELINES FOR PERFORMANCE YEARS 4 AND 5—Continued

Performance Initial Subsequent Reconciliation year Performance reconciliation reconciliation amount (PY) period calculation start calculation start (+/¥)

Subset 5.2 ...... 01/01/2021 to 09/30/2021 5 months after 09/30/2021: 17 months after 09/30/ Net PY5.1 and PY5.2 rec- Late February 2022. 2021: Late February onciliation. 2023.

In order to reflect the changes in assigned to these new DRGs rather than new DRGs to retroactively impact reconciliation timing and other changes MS–DRGs 469 and 470. quality adjusted target prices. associated with additional As background, in the FY 2021 IPPS/ As of October 1, 2020, MS–DRGs 521 reconciliations in PY5, we are amending LTCH proposed rule (85 FR 32510), and 522 separately identify a subset of the following provisions: 42 CFR 510.2, CMS proposed the creation of two new LEJR procedures that were previously 42 CFR 510.200, 42 CFR 510.305(b), MS–DRGs, 521 and 522 (Hip grouped to MS–DRGs 469 and 470, and (d)(1), (e), (i)(1) and (2), and (j)(1) and Replacement with primary hip fracture, if the definition of a CJR model episode (2), and 42 CFR 510.400(b)(3)(v), and with and without major complications is not revised to accommodate this adding 42 CFR 510.400(b)(3)(vi). and comorbidities, respectively). technical change the LEJR procedures Because the FY2021 IPPS/LTCH associated with these new codes will no 4. DRG 521 and DRG 522 proposed rule was published after the longer be part of the CJR model. This CJR February 2020 proposed rule, the result would be highly disruptive to the In this IFC we are amending our new MS–DRGs 521 and 522 were not CJR model, because it would remove a regulations at § 510.300(a) to specify addressed in the February 2020 significant number of episodes midway that, as of October 1, 2020, the CJR proposed rule. We solicited comment in through a performance year. Therefore, model includes episodes when the MS– the FY2021 IPPS/LTCH proposed rule we believe there is good cause for this DRG assigned at discharge for an anchor on the effect this proposal would have rulemaking to change the definition of hospitalization is one of two new MS– on the CJR model and whether to a CJR model episode to include MS– DRGs we adopted in the FY 2021 IPPS/ incorporate MS–DRG 521 and MS–DRG DRGs 521 and 522. Indeed, it would be LTCH final rule (85 FR 58432): MS–DRG 522, if finalized, into the CJR model’s contrary to the public interest to 521 (Hip Replacement with Principal proposed extension to December 31, undertake traditional notice and Diagnosis of Hip Fracture with Major 2023. The public also had the comment rulemaking to adopt these Complications and Comorbidities opportunity to address this issue in regulatory changes because they are (MCC)) and MS–DRG 522 (Hip comments responding to the CJR intended to preserve the model’s scope Replacement with Principal Diagnosis February 2020 proposed rule, as the in light of underlying technical changes of Hip Fracture, without MCC). As comment period for that rule had been in the IPPS. Based on the public indicated in 42 CFR 510.300(a)(1), the extended. comments previously described, we CJR model episode definition We received three comments in believe that including DRGs 521 and historically included MS–DRG 469 response to the February 2020 proposed 522 in the CJR episode definition is less (Major Hip and Knee Joint Replacement rule and 20 comments in response to the disruptive to participant hospitals than or Reattachment of Lower Extremity FY2021 IPPS/LTCH proposed rule the alternative, which would be to allow with MCC) and MS–DRG 470 (Major addressing the effects of the proposed hip replacements with a primary hip Hip and Knee Joint Replacement or new MS–DRGs on the CJR model. Most fracture to drop abruptly out of the Reattachment of Lower Extremity commenters agreed that MS–DRGs 521 model (or to drop out of the model until without MCC). For purposes of and 522 should be included in the we were able to undertake full notice calculating quality adjusted target definition of a CJR model episode, and comment rulemaking to add them prices, we further subdivided episodes noting their assumption that this would back at a later point). We believe that within each MS–DRG based on the have a neutral economic impact on the failure to retroactively incorporate MS– presence or absence of a primary hip model and participants, as the CJR DRGs 521 and 522 into the CJR model fracture. In the FY 2021 IPPS/LTCH model already provides for separate as of October 1, 2020 would be contrary final rule, we stated that because the quality adjusted target prices for hip to the public interest because it would CJR model would continue until at least fracture cases for MS–DRGs 469 and result in approximately 20–25% of all March 31, 2021, we intended to adopt 470. Multiple commenters stated their LEJR episodes to be dropped from the a policy in the CJR final rule that belief that there is value in maintaining CJR model. The categories of episodes incorporates these new MS–DRGs into hip fracture cases in the CJR model, that would be dropped tend to be the CJR model as of October 1, 2020 to including that it is administratively associated with emergent surgeries, avoid disruption to the model for the simpler and that maintaining hip high-costs, and complex post-acute care remainder of PY5 (as extended) and fractures in the CJR model would mean needs. Dropping these episodes from the thereafter, if our proposal to extend the those procedures remain subject to the model would create confusion, increase CJR model through PY8 were finalized value-based care incentives of the CJR administrative burden for participant (85 FR 58502). To this end, we are model. Some commenters suggested that hospitals, and remove the opportunity adopting the change in this IFC, with quality adjusted target prices for for participant hospitals to earn retroactive effect to October 1, 2020. episodes previously triggered by MS– reconciliation payments by coordinating This change ensures that hip DRG 469 and MS–DRG 470 with hip care for these complex, high-cost replacements with a principal diagnosis fracture could apply to episodes episodes. of hip fracture, with and without MCC, triggered by the new MS–DRGs. Others Operationally, this is a seamless will continue to trigger CJR model noted that if the DRGs were added transition for participant hospitals, episodes even though they are now retroactively, they would not want the which have continued to bill Medicare

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FFS as usual for hip replacements with In this IFC we are incorporating the responding to COVID–19 cases and the hip fractures. Beginning on October 1, new MS–DRGs 521 and 522 into the CJR expenses associated with treating the 2020, the Medicare IPPS grouper began model episode definition as of October virus. to assign those hospitalizations to one of 1, 2020, updating quality adjusted target We received comments on both the the new MS–DRGs, with no billing prices to reflect the applicable MS–DRG April 2020 IFC and the CJR February changes required of participant weights, and amending the provisions at 2020 proposed rule about the extreme hospitals. The new MS–DRGs will be 42 CFR 510.300(a)(1)(i) and (iii) to and uncontrollable circumstances incorporated into the CJR episode reflect these changes. adjustment. Commenters favored the reconciliation data system, and will be 5. Changes to Extreme and extreme and uncontrollable included in participant hospitals’ Uncontrollable Circumstances Policy for circumstances policy for COVID–19 and monthly data feeds going forward. the PHE for COVID–19 commended CMS for providing relief to Participant hospitals were notified of participant hospitals. Some commenters their quality adjusted target prices for We are also modifying the extreme questioned what steps CMS would take episodes beginning on October 1, 2020 and uncontrollable circumstances once the PHE ends and noted the for MS–DRGs 469 and 470, with and adjustment for COVID–19 in uncertainty in the current policy since without hip fracture. As of October 1, § 510.300(k)(4) to expire on March 31, there is not a concrete end date for the 2020, the quality adjusted target prices 2021 or the last day of the emergency PHE. A commenter recommended CMS for MS–DRGs 469 and 470 with hip period, whichever is earlier. In addition, hold participant hospitals harmless fracture will apply to episodes initiated we are adopting a more targeted from performance-related penalties for by the new MS–DRGs 521 and 522, adjustment, which will apply after the 2020 performance year and urged respectively, for the remainder of PY5 March 31, 2021 or the last day of CMS to make appropriate adjustments (including both performance year emergency period (whichever is earlier), for the 2020 and 2021 performance subsets 5.1 and 5.2). so that financial safeguards continue to years and to address the impact of apply for CJR episodes during which a COVID–19 on financial expenditures, Given that the CJR model currently CJR beneficiary receives a positive provides separate quality adjusted target performance scores and risk adjustment. COVID–19 diagnosis. We appreciate commenters’ positive prices for episodes with and without a Currently, the extreme and feedback on the April 2020 IFC and our hip fracture, incorporating the new uncontrollable circumstances decision to provide relief to participant DRGs would have minimal financial adjustment for COVID–19 provides hospitals. At the onset on the PHE, we impact on the model. The PY5 quality financial safeguards for participant quickly developed financial safeguards adjusted target price calculation hospitals that have a CCN primary in the April 2020 IFC due to the methodology includes the application of address that is located in an emergency update factors (80 FR 73342–73346), area during an emergency period, as mandatory nature of the model and the which incorporate annual changes to those terms are defined in section location of all 471-participant hospitals each CMS payment system (for example, 1135(g) of the Act, for which the in MSAs where COVID–19 was most IPPS, OPPS, and SNF). The update Secretary issued a waiver or prevalent. For example, there are 98 factor is calculated and applied twice modification of requirements under participant hospitals in the New York/ per year, in order to incorporate both section 1135 of the Act on March 13, New Jersey Metropolitan Area, which 44 fiscal year and calendar year payment 2020, effectively applying the financial was the epicenter for COVID–19. system updates. The MS–DRG weights safeguards to all participant hospitals. Further, at that time, we did not possess assigned to the new MS–DRGs 521 and These financial safeguards, wherein data that allowed CMS to determine the 522 in the FY 2021 IPPS/LTCH final actual episode payments are capped at COVID–19 virus’s effect on the CJR rule (84 FR 42044) will be incorporated the target price determined for that model, and believed it was most into the IPPS update factor as part of the episode, apply to fracture or non- prudent to waive downside risk for all calculation of the quality adjusted target fracture episode with a date of episodes thorough the duration of the prices for episodes beginning between admission to the anchor hospitalization PHE. October 1, 2020 and December 31, 2020. that is on or within 30 days before the Since publishing the April 2020 IFC, These FY 2021 MS–DRG weights will date that the emergency period (as we reviewed Medicare claims data and continue in the quality adjusted target defined in section 1135(g) of the Act) observe a steep decline in the initiation prices for episodes that begin between begins or that occurs through the of episodes in April 2020 (See Table 1). January 1, 2021 and September 30, termination of the emergency period (as Post April 2020, CJR episodes are 2021, which will incorporate CY 2021 described in section 1135(e) of the Act). increasing, and though not at normal payment system updates. As a result, In the April 2020 IFC we explained this utilization as compared to 2019 baseline prices for hip replacements extreme and uncontrollable Medicare claims data, the data reflects with primary hip fracture, which would circumstances adjustment, noting that a continual initiation of CJR episodes have been assigned the MS–DRGs 469 the previous CJR model policy for despite the ongoing PHE. In addition, and 470 and stratified by hip fracture extreme and uncontrollable related Federal guidance to avoid status, are comparable to those same circumstances was not applicable to the elective surgeries has expired, which episodes in the performance period that PHE for the COVID–19 pandemic. We allows certain participant hospitals to are assigned to MS–DRGs 521 and 522, also indicated that we did not expect initiate elective LEJR procedures.45 The respectively. For the remainder of PY5, many new CJR episodes to initiate in continual initiation of CJR episodes we will calculate quality adjusted target light of the COVID–19 virus and the during the PHE is contrary to our prices for episodes initiated by MS– related guidance to avoid elective assumption in the April 2020 IFC, that DRGs 521 and 522 using baseline surgeries. We further stated that we episodes initiated by MS–DRG 469 with wanted to avoid inadvertently creating 44 ‘‘New York City Region Is Now an Epicenter of fracture and MS–DRG 470 with fracture, incentives to place cost considerations the Coronavirus Pandemic’’ , 2020. Available at https://www.nytimes.com/2020/03/22/ respectively, but updated to include the above patient safety within the CJR nyregion/Coronavirus-new-York-epicenter.html. MS–DRG weights assigned to MS–DRGs model, given the challenges to the 45 https://www.cms.gov/files/document/covid- 521 and 522 for FY 2021. health care delivery system in flexibility-reopen-essential-non-covid-services.pdf.

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is, we did not expect many new CJR (whichever is earlier). Specifically, at without cost sharing, qualifying episodes to initiate during the PHE. the initial and subsequent coronavirus preventive services. This Absent a change to specify an end reconciliations of performance year coverage is required to be provided date, the current extreme and subset 5.2, which will include episodes ‘‘pursuant to section 2713(a) of the uncontrollable adjustment in 42 CFR subject to this new adjustment policy, [PHS] Act,’’ including its implementing 510.300(k)(4) would continue as long as we will identify episodes with actual regulations or any successor regulations. the PHE. Unfortunately, the episode payments with any claim Section 2713 of the PHS Act was combination of CJR episode volume containing a COVID–19 diagnosis and added by section 1001 of PPACA and increasing to levels we did not costs for those episodes will be capped incorporated by reference into ERISA by anticipate during the PHE and the at the quality adjusted target price, section 715 of ERISA and into the Code continued renewal of the PHE threatens effectively waiving downside risk for by section 9815 of the Code. Section the ability of the CJR model to generate that episode. A COVID–19 diagnosis is 2713 of the PHS Act and the regulations any savings over the course of the identified by the following ICD–10–CM implementing section 2713 of the PHS model. With greater surgical volume, we diagnosis codes: B97.29; U07.1; or any Act require non-grandfathered group do not believe such a broad extreme and other ICD–10–CM diagnosis code that is health plans and health insurance uncontrollable circumstances policy for recommended by the Centers for Disease issuers offering non-grandfathered COVID–19 remains necessary. Control and Prevention for the coding of group or individual health insurance For these reasons, we are a confirmed case of COVID–19.46 We coverage to provide coverage of certain implementing an end date to the understand that ICD–10 diagnosis codes specified preventive items and services extreme and uncontrollable B97.29 (which was used for dates of without cost sharing. These services circumstances adjustment for COVID– service on or after January 27, 2020 include: 19. Specifically, for a fracture or non- through March 31, 2020) and U07.1 • Evidence-based items or services fracture episode with a date of (which was used for dates of service on that have in effect a rating of ‘‘A’’ or ‘‘B’’ admission to the anchor hospitalization or after April 1, 2020 through September in the current recommendations of the that is on or within 30 days before the 30, 2020) might not be used for dates of USPSTF with respect to the individual date that the emergency period (as service to which our new adjustment involved. defined in section 1135(g) of the Act) policy will apply. Nevertheless, given • Immunizations for routine use in begins or that occurs on or before March the potential for uncertainty as to children, adolescents, and adults that 31, 2021 or the last day of such whether either of these codes will be have in effect a recommendation from emergency period, whichever is earlier, used for dates of service after September ACIP with respect to the individual actual episode payments are capped at 30, 2020, we are including them in the involved. A recommendation of ACIP is the quality adjusted target price definition of ‘‘COVID–19 diagnosis considered to be ‘‘in effect’’ after it has determined for that episode under code’’ that we are adding to § 510.2 for been adopted by the Director of the § 510.300. We are amending the completeness. CDC. A recommendation is considered provisions at 42 CFR 510.305(k)(4) to In order to provide participant to be for ‘‘routine use’’ if it appears on reflect this change. hospitals continuing financial the Immunization Schedules of the In addition, in order to account for protection from the effect of COVID–19 CDC. CJR beneficiaries with a positive on the CJR model that may continue • With respect to infants, children, COVID–19 diagnosis during a CJR beyond the end of the PHE for COVID– and adolescents, evidence-informed episode that initiates after the 19 or March 31, 2021, whichever occurs preventive care and screenings provided adjustments for extreme and earlier, we are implementing that actual for in the comprehensive guidelines uncontrollable circumstances specified episode payments are capped at the supported by the Health Resources and in § 510.305(k)(4) end, we are amending quality adjusted target price determined Services Administration (HRSA). our regulations at § 510.305(e)(1)(i) to for that episode under § 510.300 for • With respect to women, preventive cap actual episode payments at the episodes with actual episode payments care and screenings provided for in quality adjusted target price for the that include a claim with a COVID–19 comprehensive guidelines supported by episode, effectively waiving downside diagnosis code and initiate after the HRSA (not otherwise addressed by the risk for all episodes with actual episode earlier of March 31, 2021 or the last day recommendations of the USPSTF), payments that include a claim with a of the emergency period. subject to certain exemptions and COVID–19 diagnosis code. This policy accommodations (see 45 CFR 147.131 will apply after March 31, 2021 or the III. Provisions of the Interim Final through 147.133). last day of the PHE, whichever occurs Rule—Departments of the Treasury, The Departments’ current regulations earlier. Labor and Health and Human Services (herein referred to as the 2015 Final In response to commenters’ questions A. Rapid Coverage of Preventive Regulations) under section 2713 of the about how the CJR model will alleviate Services for Coronavirus PHS Act at 26 CFR 54.9815–2713; 29 financial risk associated with COVID–19 CFR 2590.715–2713; and 45 CFR once the PHE expires, we explored the 1. Background 147.130 require that plans and issuers flexibilities provided by other CMMI In addition to the steps Congress took provide coverage of recommended models and found them to be consistent to ensure coverage of COVID–19 preventive services for plan years that with a targeted, episode-based approach diagnostic testing, in section 3203 of the begin on or after , 2010, or, to providing financial relief from CARES Act, Congress required group if later, for plan years that begin on or COVID–19. In order to be responsible health plans and health insurance after the date that is one year after the stewards of the Medicare Trust Fund, issuers offering group or individual date the recommendation or guideline is we are adopting a policy to provide health insurance coverage to cover, issued. participant hospitals continuing Under the 2015 Final Regulations, if financial protection from the effect of 46 https://www.cdc.gov/nchs/data/icd/ICD-10- a recommended preventive service is COVID–19 on the CJR model that may CM-Official-Coding-Gudance-Interim-Advice- billed separately (or is tracked as coronavirus-feb-20- continue beyond the end of the PHE for 2020.pdf?fbclid=IwAR2c9LrGMAhum_Ogu-LrxPJ- individual encounter data separately) COVID–19 or March 31, 2021 S4u_j4wGW1615I_fmoiDB5AA0wKHKitjoXo. from an office visit, then a plan or issuer

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may impose cost-sharing requirements coronavirus preventive services is Prior to the publication of the 2015 with respect to the office visit. However, urgent. Therefore, as discussed below, Final Regulations, the Departments if a preventive service is not billed this IFC requires coverage of COVID–19 received questions from stakeholders separately (or is not tracked as immunizations within 15 business days regarding discrete coverage issues individual encounter data separately) after the immunization has been related to certain recommended from an office visit and the primary recommended by ACIP and adopted by preventive services. In particular, with purpose of the office visit is the delivery the CDC, regardless of whether it respect to colonoscopies, stakeholders of such an item or service, then a plan appears on the Immunization Schedules asked whether certain related services or issuer may not impose cost-sharing of the CDC for routine use. (such as the cost of polyp removal or requirements with respect to the office Additionally, in light of the current anesthesia) must also be covered visit. PHE for COVID–19, it is imperative that without cost sharing. The Departments The 2015 Final Regulations generally group health plans and health insurance clarified in subregulatory guidance that do not require a plan and issuer that has issuers provide full coverage for these a plan or issuer may not impose cost a network of providers to provide items and services, including costs for sharing for polyp removal during a benefits for applicable preventive items the administration of vaccines, and preventive screening colonoscopy, as or services that are delivered by an out- ensure timely access to coverage as such service is an integral part of a of-network provider. Moreover, the 2015 Congress intended. Accordingly, in this colonoscopy, and also stated that Final Regulations generally do not IFC, the Departments provide certain anesthesia provided in connection with preclude a plan or issuer that has a clarifications previously made with a preventive colonoscopy must be network of providers from imposing respect to the 2015 Final Regulations covered without cost sharing.48 cost-sharing requirements for preventive and amend those regulations to Consistent with the examples services that are delivered by an out-of- implement unique requirements related provided in the 2015 Final Regulations network provider. However, if a plan or to covering qualifying coronavirus and subregulatory guidance cited in the issuer does not have in its network a preventive services.47 preamble to the rulemaking provider who can provide a preventive promulgating the 2015 Final 2. Scope of Requirement To Cover service, then the plan or issuer must Regulations, the Departments further Certain Recommended Preventive cover the recommended preventive clarify that under the 2015 Final Services Under Section 2713 of the service when performed by an out-of- Regulations and this IFC, plans and Public Health Service Act network provider and may not impose issuers subject to section 2713 of the cost sharing with respect to the a. Related Items and Services PHS Act must cover, without cost recommended preventive service. In implementing section 2713 of the sharing, items and services that are Many items and services required to PHS Act, the 2015 Final Regulations integral to the furnishing of the be covered under section 2713 of the addressed whether office visit charges recommended preventive service, PHS Act typically are provided as part associated with certain recommended regardless of whether the item or service of the usual course of preventive care, preventive services must be covered is billed separately. For example, often according to regularly scheduled without cost sharing. Specifically, several of the recommended preventive intervals. Examples include Example 1 in the 2015 Final Regulations services involve screenings for the immunizations provided according to illustrates how the requirements apply presence of certain health conditions, schedules established by the CDC and in situations where a provider bills a such as diabetes, or a variety of sexually other annual screenings or counseling. plan for an office visit where a transmitted infections. These Therefore, the 2015 Final Regulations preventive screening for cholesterol recommended screenings, typically require coverage without cost sharing abnormalities (which has in effect a performed by laboratories, cannot be for applicable immunizations that are rating of A or B from the USPSTF) is conducted without first collecting a recommended by ACIP for routine use, conducted and for the laboratory work specimen. Accordingly, plans and and state that a recommendation is of the cholesterol screening test. In that issuers subject to section 2713 of the considered to be for ‘‘routine use’’ if it example, the plan may not impose any PHS Act must cover without cost appears on the Immunization Schedules cost-sharing requirements with respect sharing both the specimen collection of the CDC. to the separately billed laboratory work and the recommended preventive Section 3203 of the CARES Act of the cholesterol screening test. service, regardless of how the specimen establishes a more accelerated timeline Because the office visit is billed collection is billed. Similarly, a for required coverage of qualifying separately from the cholesterol recommended immunization generally coronavirus preventive services than screening test, the 2015 Final cannot be furnished without being other recommended preventive services Regulations provide that the plan may administered by a medical professional. under PHS Act section 2713. As stated impose cost-sharing requirements for As qualifying coronavirus preventive above, coverage of qualifying the office visit. services are expected to include coronavirus preventive services must be immunizations, plans and issuers provided no later than 15 business days 47 The 2015 Final Regulations address the subject to section 2713 of the PHS Act following an applicable obligation to continue to provide coverage for recommended preventive services that are in effect recommendation. In addition, it is 48 See FAQs About Affordable Care Act possible that items, services, and on the first day of a plan or policy year when there are changes in recommendations or guidelines. See Implementation Part 12, Q5 (Feb. 20, 2013), immunizations used to prevent or 26 CFR 54.9815–2713(b)(2)(i) and (ii); 29 CFR available at https://www.dol.gov/sites/dolgov/files/ mitigate COVID–19 will not, in the 2590.715–2713(b)(2)(i) and (ii); 45 CFR EBSA/about-ebsa/our-activities/resource-center/ immediate future, be recommended as 147.130(b)(2)(i) and (ii). Given the expedited faqs/aca-part-xii.pdf and https://www.cms.gov/ timeline for coverage under section 3203 of the CCIIO/Resources/Fact-Sheets-and-FAQs/aca_ part of a usual course of preventive care, CARES Act, this IFC amends the 2015 Final implementation_faqs12 and FAQs About Affordable but rather for more urgent use. As Regulations to make clear that these paragraphs Care Act Implementation Part XXVI, Q7 (, reflected by the expedited timeline for apply to recommended preventive services that are 2015), available at https://www.dol.gov/sites/ coverage Congress established in section covered on the first day of the plan or policy year dolgov/files/EBSA/about-ebsa/our-activities/ or, with respect to qualifying coronavirus resource-center/faqs/aca-part-xxvi.pdf and https:// 3203 of the CARES Act, the need to preventive services, ‘‘as otherwise specified in www.cms.gov/CCIIO/Resources/Fact-Sheets-and- provide coverage of qualifying paragraph (b)(3) of this section.’’ FAQs/Downloads/aca_implementation_faqs26.pdf.

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must cover without cost sharing such an whether such service is delivered by an Departments also request comment on immunization and its administration, in-network or out-of-network provider. the safeguards in this IFC to ensure that regardless of how the administration is This is based on the Departments’ view out-of-network reimbursement rates are billed, and regardless of whether a that participants, beneficiaries, and reasonable and that providers COVID–19 vaccine or any other enrollees may not be able to locate in- administering a publicly funded immunization requires the network providers consistently during COVID–19 vaccine are reimbursed by administration of multiple doses in the emergency period. group health plans and issuers order to be considered a complete To satisfy this requirement, the prevailing market rates in the absence of vaccination. This includes coverage Departments are of the view that plans a negotiated rate, and whether other without cost sharing of the and issuers must administer this out-of- examples of reasonable reimbursement administration of a required preventive network coverage requirement in such a rates, in addition to Medicare rates, immunization in instances where a way that makes receiving out-of- would be useful. third party, such as the Federal network services for qualifying Government, pays for the preventive coronavirus preventive services a 3. Definition of Qualifying Coronavirus immunization. Further, if a COVID–19 meaningful benefit for participants, Preventive Services immunization is not billed separately beneficiaries, and enrollees. To be a Section 3203(b)(1) of the CARES Act (or is not tracked as individual meaningful benefit, the Departments are defines ‘‘qualifying coronavirus encounter data separately) from an of the view that plans and issuers must preventive service’’ as an item, service, office visit and the primary purpose of administer this out-of-network coverage or immunization that is intended to the visit is the delivery of the requirement in a way that ensures that prevent or mitigate COVID–19 and that recommended COVID–19 participants, beneficiaries, and enrollees is—(A) an evidence-based item or immunization, then consistent with the have access to a variety of out-of- service that has in effect a rating of ‘A’ 2015 Final Regulations, the plan or network providers for such services. To or ‘B’ in the current recommendations of issuer may not impose cost-sharing the extent plans and issuers reimburse the USPSTF; or (B) an immunization requirements with respect to the office out-of-network providers an that has in effect a recommendation visit. The Departments seek comment unreasonably low amount for qualifying from ACIP with respect to the on this clarification. coronavirus preventive services, individual involved. The statutory including for administration of a provisions describing USPSTF and b. Out-of-Network Coverage During the COVID–19 vaccine, this approach could PHE for COVID–19 ACIP recommendations in this severely limit the number of such definition are substantively identical to The 2015 Final Regulations permit a providers that are willing to provide the the ones at section 2713(a)(1) and (2) of group health plan or issuer that has a service, which would contravene the the PHS Act. However, as stated above, network of providers to omit coverage or purpose of the requirement to provide under the 2015 Final Regulations, only to impose cost-sharing requirements for out-of-network coverage without cost ‘‘immunizations for routine use in recommended preventive services when sharing of qualifying coronavirus children, adolescents, and adults’’ that such services are provided by an out-of- preventive services. Therefore, this IFC are recommended by ACIP must be network provider, unless the plan or provides that with respect to a covered without cost sharing.50 A issuer does not have in its network a qualifying coronavirus preventive recommendation is considered to be for 49 provider who can provide the service. service and a provider with whom the routine use if it is listed on the CDC’s This approach reflects that, as noted plan or issuer does not have a Immunization Schedules.51 earlier in this section of the preamble, negotiated rate for such service (such as This IFC provides a definition of recommended preventive services an out-of-network provider), the plan or qualifying coronavirus preventive generally are obtained as part of a issuer must reimburse the provider for services that is consistent with the regular course of preventive care, so such service in an amount that is statutory definition in section 3203 of participants, beneficiaries, and enrollees reasonable, as determined in the CARES Act. However, the typically have the opportunity to seek comparison to prevailing market rates Departments note that unlike the other such care from an in-network provider. for such service. The Departments will preventive service immunizations By contrast, in the immediate term, consider the amount of payment to be required to be covered without cost newly developed qualifying coronavirus reasonable, for example, if the plan or sharing under section 2713 of the PHS preventive services might be available issuer pays the provider the amount that Act and the 2015 Final Regulations, this from a narrower range of providers than would be paid under Medicare for the definition and related coverage other, more established recommended item or service. In the Departments’ requirement are not limited to COVID– preventive services. To help ensure full view, these minimum payment 19 immunizations recommended by access to and the widespread use of standards are necessary and appropriate ACIP for ‘‘routine use.’’ While other qualifying coronavirus preventive because providers that participate in the preventive items and services may be services to mitigate the effect of the PHE CDC COVID–19 Vaccination Program recommended for routine use, for for COVID–19 and slow transmission of contractually agree to administer a reasons described elsewhere in this the virus, it is critical that individuals COVID–19 vaccine regardless of an section of the preamble, the PHE for be able to receive such services from individual’s ability to pay and COVID–19 presents unique any provider authorized to provide the regardless of their coverage status, and circumstances and qualifying service. Therefore, this IFC amends the also may not seek any reimbursement, coronavirus preventive services might 2015 Final Regulations to require that including through balance billing, from not, in the immediate term, be plans and issuers subject to section 2713 a vaccine recipient. recommended for routine use, according The Departments request comment on of the PHS Act must cover without cost to specified schedules. Rather, the sharing a qualifying coronavirus all aspects of this approach. The Departments request comment on the preventive service, regardless of 50 See 75 FR 41726, 41728 (, 2010), issue of network adequacy and whether codified at 26 CFR 54.9815–2713(a)(1)(ii); 29 CFR 49 26 CFR 54.9815–2713(a)(3); 29 CFR 2590.715– and, if so, how long provider networks 2590.715–2713(a)(1)(ii); 45 CFR 147.130(a)(1)(ii). 2713(a)(3); 45 CFR 147.130(a)(3). are expected to be inadequate. The 51 Id.

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Departments generally expect B. Diagnostic Testing for COVID–19 The Departments encourage group consumers should receive an Section 6001 of the FFCRA generally health plans and issuers of group or immunization for COVID–19 as soon as requires group health plans and health individual health insurance coverage to it becomes available to the general insurance issuers offering group or consider market-driven approaches to public, or as soon as it becomes individual health insurance coverage to addressing these continued challenges available to them based on their status provide benefits for COVID–19 surrounding COVID–19 diagnostic as part of a high-risk or high-priority testing. The Departments encourage diagnostic tests and certain items and population, as recommended by ACIP. plans and issuers to explore using services related to diagnostic testing for Plans and issuers subject to section 2713 payment arrangements that create COVID–19 when those items or services of the PHS Act must cover, without cost incentives for providers to reduce the are furnished on or after March 18, sharing, COVID–19 immunizations that time it takes to provide results for 2020, and during the duration of the are recommended by ACIP and adopted diagnostic testing for COVID–19, while PHE for COVID–19. Under the FFCRA, by the Director of CDC, even if not listed maintaining the accuracy rates of their plans and issuers must provide this for routine use on the CDC test results in instances where it is coverage without imposing any cost- Immunization Schedules, pursuant to within the ability of providers to sharing requirements (including 26 CFR 54.9815–2713T(a); 29 CFR address a delay. 2590.715–2713(a); and 45 CFR deductibles, copayments, and At certain points in this PHE, there 147.130(a), and subject to the additional coinsurance) or prior authorization or have been wide variations in the time it changes described later in this section of other medical management takes providers to make test results the preamble.52 requirements. Section 3201 of the available to consumers. These delays in CARES Act, enacted on March 27, 2020, obtaining test results increase the risk 4. Qualifying Coronavirus Preventive amended section 6001 of the FFCRA to that infected individuals may Services—Timing Requirement include a broader range of diagnostic unknowingly infect others. These delays Section 2713 of the PHS Act and the tests that plans and issuers must cover could be caused by large volumes of 2015 Final Regulations require plans without any cost-sharing requirements tests to process and/or inadequate and issuers to cover recommended or prior authorization or other medical resources. Pay-for-performance preventive items and services beginning management requirements. arrangements, where reimbursement with the first plan year (or in the Section 3202(a) of the CARES Act rates are based on the time it takes to individual market, policy year) that is provides that a plan or issuer providing make test results available, could one year after the date the coverage of items or services described encourage innovative approaches by recommendation or guideline is issued. in section 6001(a) of the FFCRA shall providers to reduce the turnaround Section 3203 of the CARES Act reimburse the provider of the diagnostic time. The Departments encourage group accelerates the timeline for coverage of testing at a rate negotiated with the health plans and issuers of group or qualifying coronavirus preventive provider, or if there is no negotiated individual health insurance coverage to services without cost sharing, requiring rate, at an amount that equals the cash consider developing such arrangements coverage to be provided within 15 price for such service as listed by the with providers, and strongly encourage business days after the date on which a provider on a public internet website. plans and issuers that do so to recommendation is made relating to As previously articulated in guidance, incorporate safeguards to ensure that the such service. This IFC codifies these the Departments interpret the payment arrangements are not timing requirements at 26 CFR 54.9815– requirement to provide coverage structured in a way that prioritizes 2713T(b)(3); 29 CFR 2590.715– without cost sharing in section 6001 of speed over accuracy or that result in 2713(b)(3); and 45 CFR 147.130(b)(3). the FFCRA, together with section unintended consequences, such as In addition, the IFC adds a sunset 3202(a) of the CARES Act, as reduction in access to COVID–19 provision at 26 CFR 54.9815–2713T(e); establishing a process for setting diagnostic testing or non-compliance 29 CFR 2590.715–2713(e); and 45 CFR reimbursement rates and protecting with balance billing restrictions. 147.130(e), under which the participants, beneficiaries, and enrollees amendments made to the regulations from being balance billed for an IV. Provisions of the Interim Final Rule will not apply with respect to qualifying applicable COVID–19 test.53 These Regarding State Innovation Waivers— coronavirus preventive services provisions help ensure consumers can Department of the Treasury and Health and Human Services furnished on or after the expiration of be tested for COVID–19 without barriers the PHE for COVID–19. The related to cost, and are critical to the A. State Innovation Waivers Policy and Departments note, however, that ability to detect the virus and stop its Regulatory Revisions in Response to the coverage under section 3203 of the spread. However, testing efforts have PHE for COVID–19 Public Health CARES Act is not limited to the continued to be hampered by Emergency duration of the PHE for COVID–19 and challenges, such as delays in obtaining 1. Background therefore the statutory provisions will results, issues with test accuracy, and continue to apply. supply shortages.54 Section 1332 of the PPACA permits states to apply for a State Innovation 52 HHS reminds states that the HHS Office for 53 FAQs About Families First Coronavirus Waiver (also referred to as ‘‘section 1332 Civil Rights enforces applicable Federal civil rights waivers’’ or ‘‘State Relief and laws as described above, as well as laws protecting Response Act and Coronavirus Aid, Relief, and the exercise of conscience and religious freedom, Economic Security Act Implementation Part 43 Empowerment Waivers’’) to pursue including the Religious Freedom Restoration Act (, 2020), available at https://www.cms.gov/ innovative strategies for providing their files/document/FFCRA-Part-43-FAQs.pdf and (42 U.S.C. 2000bb through 2000bb–4). HHS’s residents with access to higher value, requirements are subject to these laws, and states https://www.dol.gov/sites/dolgov/files/ebsa/about- may have obligations under these laws to protect ebsa/our-activities/resource-center/faqs/aca-part- more affordable health coverage. The conscience, prohibit coercion, and to ensure the 43.pdf. overarching goal of section 1332 waivers free exercise of religion. U.S. Department of Health 54 American Society for Microbiology, ‘‘Supply is to give all Americans the opportunity & Human Services, Office for Civil Rights, Shortages Impacting COVID–19 and Non-COVID to obtain high value and affordable Conscience and Religious Freedom, https:// Testing’’ (Oct. 15, 2020), available at https:// www.hhs.gov/conscience/index.html (last visited asm.org/Articles/2020/September/Clinical- health coverage regardless of income, Aug. 20, 2020). Microbiology-Supply-Shortage-Collecti-1. geography, age, sex, or health status,

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while simultaneously empowering 1332(a)(4)(B) of the PPACA.57 On Secretaries to modify some of the states to develop health coverage , 2012, HHS and the existing regulatory public notice strategies that best meet the needs of Department of the Treasury published procedures to expedite a decision on a their residents. Section 1332 waivers the ‘‘Application, Review, and proposed waiver request during the PHE provide states an opportunity to Reporting Process for Waivers for State for COVID–19 when a delay would promote a stable health insurance Innovation’’ final rule (77 FR 11700) undermine or compromise the purpose market that offers more choice and (hereinafter referred to as the ‘‘2012 of the proposed waiver request and be affordability to their residents. Under Final Rule’’).58 On , 2018, contrary to the interests of consumers. section 1332 of the PPACA, a State HHS and the Department of the The Secretaries will also make available Innovation Waiver can be approved by Treasury issued the ‘‘State Relief and such flexibility regarding public notice HHS and the Department of the Empowerment Waivers’’ guidance (83 procedures should any state with an Treasury if it provides access to quality FR 53575) (hereinafter referred to as the approved section 1332 waiver request health coverage that is at least as ‘‘2018 Guidance’’), which superseded an extension or amendment of an comprehensive and affordable as would the previous guidance published on approved section 1332 waiver during be provided absent the waiver, provides , 2015 (80 FR 78131), and the PHE for COVID–19. coverage to a comparable number of provided additional information about Similarly, this IFC also establishes a residents of the state as would be the requirements that states must meet framework for the Secretaries to modify, provided coverage absent a waiver, and regarding section 1332 waiver in part, post award public notice does not increase the Federal deficit. To proposals, the Secretaries’ application procedures for an approved waiver date, HHS and the Department of the review procedures, pass-through request that would otherwise take place Treasury have approved 15 state waiver funding determinations, certain or become due during the PHE for requests, 14 of which implement state- analytical requirements, and operational COVID–19. The Secretaries will also 59 60 based reinsurance programs.55 As noted considerations. make available such flexibility for post in a recent data brief issued by CMS, Section 1332(a)(4)(B) of the PPACA award public notice procedures for also directs HHS and the Department of section 1332 state-based reinsurance approved waiver extensions, the Treasury to issue regulations that waivers have resulted in a statewide amendments, or phase-out for a waiver provide for state and Federal public average premium reduction ranging should those otherwise take place or notice and comment sufficient to ensure from four to 37 percent in calendar year become due during the PHE for COVID– a meaningful level of public input 2020 for residents in states with 19. HHS and the Department of the regarding a state’s section 1332 waiver approved waivers.56 Reinsurance Treasury are of the view that section plan, both during the application provides a direct benefit to consumers 1332 waivers are a critical tool for states process and after a waiver is by paying a portion of provider claims to ensure patients have stable access to implemented. Current regulations and that would otherwise be paid by health care coverage, including during guidance address how states may apply consumers through higher premiums the PHE for COVID–19. These interim and lowering premiums for people in for a waiver, information states must include in an application, public notice final provisions are effective the individual health insurance market. immediately for the duration of the PHE HHS and the Department of the and comment requirements, and HHS’ and the Department of the Treasury’s for COVID–19. HHS and the Department Treasury continue to encourage states to of the Treasury note that existing threats take advantage of the flexibilities monitoring and compliance activities, including state reporting requirements to consumers’ access to health coverage available through section 1332 waivers (collectively referred to as public notice or care—such as in geographic areas in in order to pursue solutions to help procedures). which issuer participation has been low lower costs and increase coverage The Secretaries are setting forth a for some time—would not be considered choices for Americans faced with process for states to request emergency situations for purposes of unaffordable premiums and reduced modifications to the public notice applying the flexibilities adopted in this competition in the insurance market procedures during the PHE for COVID– rulemaking. both during and after the PHE for 19 prior to and after approval of a 2. Public Notice Procedures and COVID–19. section 1332 waiver that continue to Section 1332(a)(4)(B) of the PPACA Approval Processes During the PHE (31 meet the statutory and regulatory CFR 33.118 and 45 CFR 155.1318) requires the Secretary of HHS and the requirements that the public has an Secretary of the Treasury (the opportunity to provide meaningful Section 1332(a)(4)(B) of the PPACA Secretaries) to issue regulations input. Further the Secretaries are provides that the Secretary of HHS and regarding procedures for State promulgating this rule so that HHS and the Secretary of the Treasury shall issue Innovation Waivers. On , 2011, the Department of the Treasury do not regulations providing a process for HHS and the Department of the impose requirements that are public notice and comment at the state Treasury published the ‘‘Application, unreasonable or unnecessarily level, including public hearings, and a Review, and Reporting Process for burdensome regarding state compliance process for providing public notice and Waivers for State Innovation’’ proposed consistent with section 1332(a)(4)(B)(iii) comment after the application is rule (76 FR 13553) to implement section of the PPACA during the PHE for received by the Secretaries, that are both COVID 19. This IFC promulgates rules sufficient to ensure a meaningful level 55 More information on section 1332 waivers that to establish a framework for the of public input. Current regulations at are approved is available online: https:// §§ 33.112 and 155.1312 specify state www.cms.gov/CCIIO/Programs-and-Initiatives/ State-Innovation-Waivers/Section_1332_State_ 57 https://www.govinfo.gov/content/pkg/FR-2011- public notice and participation Innovation_Waivers-. 03-14/pdf/2011-5583.pdf. requirements for proposed waiver 56 CCIIO Data Brief Series: State Relief and 58 https://www.govinfo.gov/content/pkg/FR-2012- requests, and §§ 33.116(b) and Empowerment Waives: State-based Reinsurance 02-27/pdf/2012-4395.pdf. 155.1316(b) specify the accompanying Programs. June 2020. Available online: https:// 59 https://www.govinfo.gov/content/pkg/FR-2018- www.cms.gov/CCIIO/Programs-and-Initiatives/ 10-24/pdf/2018-23182.pdf. public notice and comment period State-Innovation-Waivers/Downloads/1332-Data- 60 https://www.govinfo.gov/content/pkg/FR-2015- requirements under the Federal public Brief-June2020.pdf. 12-16/pdf/2015-31563.pdf. notice and approval process.

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Under the current regulations at determination that a state’s section 1332 section 1332 waivers during the PHE. §§ 33.112 and 155.1312, states are waiver application is complete. Additionally, states may face required to provide a public notice and Section 1332 waivers may vary uncertainty as to whether their waiver comment period prior to submitting an significantly in their complexity and request will be approved in time, given application for a new section 1332 breadth. The existing regulations the state and Federal public notice waiver. The notice must include a generally provide states and the Federal procedures or other public participation comprehensive description of the Government flexibility in determining requirement associated with state section 1332 waiver application; and/or extending the length of the procedures that would otherwise information about where the application comment periods. Both the state and the require an in-person gathering, to is available for public review; where the Federal public notice and comment expeditiously reform their health written comments may be submitted; periods must be sufficient to ensure a insurance markets and to protect and the location, date, and time of meaningful level of public input. The consumers from the effects of the PHE public hearings that will be convened 2018 Guidance 63 further specifies that for COVID–19. Some states may not by the state to seek public input on the the state comment period should be no consider more robust changes because application for a section 1332 waiver.61 less than 30 days, and explains that they are concerned that the current After issuing the public notice and prior consistent with HHS regulations, waiver section 1332 waiver application to submitting an application for a applications must be posted online in a requirements are too time-consuming or section 1332 waiver, the state must hold manner that meets technical standards burdensome to pursue during the PHE public hearings to allow the public to for website accessibility similar to for COVID–19. Therefore, HHS and the learn about and comment on the state’s applicable national standards 64 to Department of the Treasury are of the application, and must publish the date, ensure access for individuals with view that having the flexibility to time, and location of the hearings in a disabilities. modify certain public notice procedures prominent location on the state’s public HHS and the Department of the and participation requirements during website.62 As set forth in §§ 33.112(a)(2) Treasury recognize that the current the PHE for COVID–19 will protect and 155.1312(a)(2), as part of the public section 1332 regulations regarding state public health and health insurance notice and comment period, a state with and Federal public notice procedures markets, and will increase flexibility one or more federally recognized tribes and comment period requirements may and reduce burdens for states seeking to must conduct a separate process for impose barriers for states pursuing a use section 1332 waivers as a means of meaningful consultation with such proposed waiver request during the PHE 65 innovation for providing coverage, tribes, if applicable. As HHS and the for COVID–19. It is the mission of lowering premiums, and improving Department of the Treasury explained in HHS to enhance and protect the health their health care markets. the 2012 Final Rule preamble, this tribal and well-being of all Americans. As Section 1332 waivers are a critical such, HHS and the Department of the consultation must be conducted in tool for states to ensure patients across Treasury are issuing this guidance to accordance with Executive Order (E.O.) the country have access to health care protect public health and to prevent the 13175, and, as E.O. 13175 also applies coverage. About 10.7 million spread of COVID–19 by limiting the to Medicaid, a state may use a Medicaid individuals on average rely on the need for in-person gatherings related to consultation process to satisfy the Exchanges to purchase individual consultation needed for a section 1332 health insurance coverage throughout 63 83 FR 53575 (https://www.govinfo.gov/content/ waiver (77 FR 11700, 11706). the year.66 67 Although recently there Furthermore, the state should include in pkg/FR-2018-10-24/pdf/2018-23182.pdf). 64 ‘‘National standards’’ refers to standards issued have been positive premium its section 1332 waiver application a by the Architectural and Transportation Barriers stabilization and insurer participation description of issues raised and Compliance Board (often referred to as ‘‘section trends, the COVID–19 pandemic has 508’’ standards), or alternatively, the World Wide comments received. introduced new uncertainties in the In addition, under section Web Consortium’s Web Content Accessibility individual and small group markets 1332(a)(4)(B)(iii) of the PPACA and the Guidelines (WCAG) 2.0 Level AA standards. See 83 FR 53575, 53583 (Oct. 24, 2018). such that past trends resulting in existing implementing regulations at 65 During the PHE for COVID–19, under the limited access and affordability may §§ 33.116(b) and 155.1316(b), the Secretaries’ discretion, HHS and the Department of return in some areas. For example, in Secretary of HHS and the Secretary of the Treasury have allowed states to conduct their response to the uncertainty created by the Treasury are required to provide a public forums virtually, both prior to application Federal public notice and comment submission and post award. For example, following the PHE for COVID–19 regarding health the scheduling and notice of the hearings, and in care utilization rates and claims costs, period following their preliminary consultation with CMS, the New Hampshire Insurance Department rescheduled planned in- such as those associated with testing 61 31 CFR 33.112(b); 45 CFR 155.1312(b). person public hearings to an online webinar format and treatment for COVID–19, premiums 62 In response to a question from a commenter, in response to social distancing guidance provided may increase and issuers may reduce the 2012 Final Rule states that ‘‘hearings,’’ as used by New Hampshire Governor Chris Sununu and the their presence or coverage options in the in 31 CFR 33.112(c)(1) and 45 CFR 155.1312(c)(1), Federal government. (https://www.nh.gov/ individual and small group markets. means no less than two hearings. (77 FR 11700, insurance/lah/documents/nh-section-1332-waiver- 11706). The HHS and the Department of Treasury draft.pdf). Georgia also offered public hearings Additionally, due to the PHE for continue to interpret the regulatory requirement virtually because of public health concerns COVID–19, some issuers may have that a State shall hold ‘‘hearings’’ to refer to at least regarding large, in-person gatherings during the difficulty predicting the composition of two hearings, except as otherwise provided by the COVID–19 pandemic. In addition, as of , their risk pools given uncertainty about amendments made in this IFC. The existing 2020, several states with approved waivers regulation does not expressly rely on the statutory conducted their post award forum virtually due to requirement that the Secretaries of HHS and COVID–19, including Alaska, Colorado, Delaware, 66 American Health Benefit Exchanges, or Treasury establish ‘‘a process for public notice and Maine, Maryland, Minnesota, Montana, Oregon, ‘‘Exchanges,’’ are entities established under PPACA comment at the State level, including public North Dakota, Rhode Island, and Wisconsin. In this through which qualified individuals and qualified hearings . . . ’’ and HHS and the Department of the IFC, the Secretaries expand and build upon this employers can purchase health insurance coverage Treasury are of the view that language, by itself, approach by providing more flexibility to allow in qualified health plans (QHPs). does not require a particular state to hold more than HHS and the Department of the Treasury to 67 First Half of 2020 Average Effectuated one hearing. Rather, the statutory language expedite a decision on a proposed waiver request. Enrollment Data, available at https://www.cms.gov/ describes a process applicable across multiple (https://medicaid.georgia.gov/document/document/ CCIIO/Resources/Forms-Reports-and-Other- states, which will, in the aggregate, necessarily georgia1332waiverapplicationfinal07312020vfpdf/ Resources/Downloads/Early-2020-2019-Effectuated- involve multiple hearings. download). Enrollment-Report.pdf.

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the risk profiles of many new enrollees of the proposed waiver request and be to the public health threat.68 States coming from employer-sponsored contrary to the interests of consumers. seeking new section 1332 waiver(s) that coverage and the potential transition of During the PHE for COVID–19, the have such prohibitions in effect at the other enrollees to Medicaid due to Secretary of HHS and the Secretary of time they would have otherwise have to income loss. Therefore, HHS and the the Treasury (the Secretaries) may conduct public notice would most likely Department of the Treasury are modify the Federal and/or state public be unable to comply with the public concerned that past trends that threaten notice procedures, in part, if the state notice requirements to hold two in- the stability of the individual market meets all of the following: person public hearings prior to risk pool may return, leading some • The state requests a modification in submission of their section 1332 waiver issuers to cease offering coverage on the the form and manner specified by the applications in accordance with the Exchanges in some states and counties Secretaries. 2018 Guidance addressing requirements and leading other issuers to increase • The state acted in good faith, and in under §§ 33.112(b) and 155.1312(b). In their rates, leaving some geographic a diligent, timely, and prudent manner such cases, this IFC will allow the areas with limited or no affordable in the preparation of the request for the Secretaries to grant the state’s request to Exchange coverage options. Permitting modification for the waiver, and the hold the two public hearings virtually, the Secretary of HHS and the Secretary waiver application request. rather than in-person, or to hold one of the Treasury to modify the public • public hearing at the state level, rather notice procedures, in part, will help The state details in its request for a than two public hearings at the state states seeking section 1332 waivers to modification, as applicable, the level. As another example, the address such circumstances more reason(s) the state seeks a modification Secretaries may agree with a state that, quickly and develop innovative ways to from the state public notice procedures, due to emergency circumstances that ensure consumers have access to describes how the state meets the have arisen related to the PHE for affordable health care coverage. As modification criteria, and describes the COVID–19, there is insufficient time for such, HHS and the Department of the alternative public notice procedures it the state to provide public notice and Treasury are of the view that, if certain proposes to implement at the state level, hold any public hearings at the state safeguards are met, it is in the best including public hearings, that are level prior to submitting its section 1332 interest of the public to provide states designed to provide the greatest waiver application as required by applying for section 1332 waivers with opportunity and level of meaningful §§ 33.112(a) and 155.1312(a), and grant the option to request to modify public public input from impacted the state’s request to provide public notice procedures during the PHE for stakeholders that is practicable given notice and hold public hearings at the COVID–19. the emergency circumstances state level after the state submits its This IFC adds the new §§ 33.118 and underlying the state’s request for a section 1332 waiver application. 155.1318 and provides that the modification. In situations where HHS and the Secretary of HHS and the Secretary of • The state details in its request for a Department of the Treasury determine the Treasury may modify, in part, the modification, as applicable, the that public notice and hearings are state public notice requirements justification for the request and the warranted on a different timeframe and specified in §§ 33.112 and 155.1312 and alternative public notice procedures it may occur after the submission of a the Federal public notice requirements requests to be implemented at the state’s waiver application request, the specified at §§ 33.116(b) and Federal level. state will be required to amend the 155.1316(b) to expedite a decision on a • The state must, as applicable, application request as necessary to proposed waiver request during the PHE implement the alternative public notice reflect public comments or other for COVID–19 when a delay would procedures at the state level if the state’s relevant feedback received during the undermine or compromise the purpose modification request is approved and, if alternative public notice procedures. of the proposed waiver request and be required, amend the waiver application HHS and the Department of the contrary to the interests of consumers. to specify that it is the state’s intent to Treasury will evaluate a state’s request Examples of the public notice comply with those alternative public for a modification and issue their procedures that currently apply under notice procedures in the state’s modification determination within the aforementioned regulations that a modification request. approximately 15 calendar days after state may seek to have waived or Any state submitting a proposed the request is received. In assessing modified include the requirement that waiver request during the PHE for whether a state acted in good faith, and states notify the public and hold COVID–19 can submit a request to the in a diligent, timely, and prudent hearings prior to submitting an Secretary of HHS and the Secretary of manner in the preparation of the application, that the state hold more the Treasury for this modification from modification request for the waiver, and than one public hearing in more than for the waiver application, HHS and the the state and/or Federal public notice one location and that HHS and the Department of the Treasury will procedures or include such a request in Department of the Treasury provide for evaluate whether the relevant its section 1332 waiver application public notice and comment after an circumstances constitute an emergency. request. application is determined to be HHS and the Department of the complete. States may also seek to The Secretary of HHS and the Treasury remind states that any public modify the state and/or Federal Secretary of the Treasury’s review and participation processes must continue to comment periods to be less than 30 days consideration of a modification request comply with applicable Federal civil and to host public hearings virtually will vary based on the state’s rights laws, including taking reasonable rather than in-person. circumstances, its modification request, steps to provide meaningful access for For a state to qualify for modification and the complexity and breadth of the individuals with limited English of the state or Federal public notice state’s proposed section 1332 waiver requirements to expedite a decision on request. For example, during the PHE 68 https://khn.org/morning-breakout/states- a proposed waiver request during the for COVID–19, many states are declare-emergencies-ban-large-gatherings-as- prohibiting in-person public gatherings coronavirus-sweeps-the-nation/. https:// PHE for COVID–19, a delay must www.axios.com/states-shelter-in-place-coronavirus- undermine or compromise the purpose or establishing stay-at-home orders due 66e9987a-a674-42bc-8d3f-070a1c0ee1a9.html.

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proficiency and taking appropriate steps section 1332 waivers (consistent with monitor the state’s compliance with the to ensure effective communication with section 1332(a)(4)(B)(iv) of the PPACA). specific terms and conditions of the individuals with disabilities, including Under §§ 33.120(c) and 155.1320(c), to waiver including, but not limited to, accessibility of information and ensure continued public input within at compliance with the guardrails, communication technology. Please note least 6 months after the implementation reporting requirements, and the post that virtual meetings may present date, and annually thereafter, states are award forum requirements. Under the additional accessibility challenges for required to hold a public forum at flexibilities provided in this IFC, the people with communications and which members of the public have an Secretaries may, for example, allow the mobility disabilities, as well as to those opportunity to provide comments on the public forum for an approved waiver who lack broadband access. Ensuring progress of the program authorized by that would take place or become due effective communication may include the section 1332 waiver and to provide during the PHE for COVID–19 to be held providing American Sign Language a summary of this forum to the virtually rather than as an in person interpretation and real-time captioning, Secretary of HHS as part of the quarterly gathering. HHS and the Department of and ensuring that the platform is and annual reports required under the Treasury will work closely with interoperable with assistive technology §§ 33.124 and 155.1324. Under states that have these approved for those with mobility difficulties. HHS §§ 33.120(c)(1) and 155.1320(c)(1), states flexibilities through oversight and and the Department of the Treasury are required to publish the date, time, monitoring activities to ensure open especially encourage states to strive to and location of the public forum in a communication with states during the obtain meaningful input from prominent location on the state’s public PHE for COVID–19. HHS and the potentially affected populations, website at least 30 days prior to the date Department of the Treasury also will including low-income residents, of the planned public forum. remain focused on ensuring the public residents with high expected health care This IFC adds new §§ 33.120(c)(2) and is informed about the implementation of costs, persons less likely to have access 155.1320(c)(2), which provide that the programs authorized by section 1332 to care, and members of federally- Secretary of HHS and the Secretary of waivers and have a meaningful recognized tribes, if applicable, as part the Treasury (the Secretaries) may opportunity to comment on the of any alternative public participation waive, in part, post award public notice implementation. process.69 requirements for an approved waiver The Secretary of HHS and the The Secretary of HHS will publish on outlined in §§ 33.120(c) and 155.1320(c) Secretary of the Treasury will evaluate the CMS website any modification during the PHE for COVID–19 when the a state’s request for a modification and determinations within 15 calendar days application of the post award public issue their modification determination of the Secretary of HHS and the notice procedures would be contrary to within approximately 15 calendar days Secretary of the Treasury making such the interests of consumers during the after the request is received. The state is a determination, as well as the approved PHE for COVID–19. required to publish on its website any The Secretaries may modify the post revised timeline for public comment at modification requests and award public notice procedures, in part, the state and Federal level, as determinations by HHS and the when the state meets all of the applicable. In addition, under the new Department of the Treasury within 15 following: calendar days of receipt of the §§ 33.118 and 155.1318, the state will be • The state requests a modification in required to publish on its website any determination, as well as information on the form and manner specified by the the approved revised timeline for the modification requests and Secretaries. state’s post award public notice determinations within 15 calendar days • The state acts in good faith, and in procedures, as applicable. Since the of receipt of the determination, as well a diligent, timely, and prudent manner state is already required to post as the approved revised timeline for to comply with the monitoring and materials as part of post award annual public comment at the state and Federal compliance requirements under the reporting requirements, such as the level, as applicable. regulations and specific terms and notice for the public forum and annual 3. Monitoring and Compliance (31 CFR conditions of the waiver and to submit report, states will be responsible for 33.120 and 45 CFR 155.1320) and prepare the request for a ensuring that the public is aware of the modification. As section 1332 waivers are likely to determination to modify the public • The state details in its request for a notice procedures and must include this a have a significant impact on modification the reason(s) the state information along with the information individuals, states, and the Federal seeks a modification from the state post required under §§ 33.120(c)(1) and Government, the 2012 Final Rule award public notice procedures, 155.1320(c)(1) in a prominent location established processes and describes how the state meets the on the state’s public website. methodologies to ensure that the modification criteria, and describes the HHS and the Department of the Secretary of HHS and the Secretary of alternative post award public notice Treasury are of the view that post award the Treasury receive adequate and procedures it proposes to implement at forums are critical to ensure that the appropriate information regarding the state level, including public public has a regular opportunity to learn hearings, that are designed to provide about and comment on the progress of 69 As noted above, the HHS Office for Civil Rights enforces applicable Federal civil rights laws as the greatest opportunity and level of section 1332 waivers. States that receive described above, as well as laws protecting the meaningful public input from impacted approval, to modify, in part, these post exercise of conscience and religious freedom, stakeholders that is practicable given award public notice procedures would including the Religious Freedom Restoration Act the emergency circumstances still need to meet all other requirements (42 U.S.C. 2000bb through 2000bb–4). HHS’s requirements are subject to these laws, and states underlying the state’s request for a specified in §§ 33.112(b) and may have obligations under these laws to protect modification. 155.1312(b). For example, should the conscience, prohibit coercion, and to ensure the As part of HHS and the Department of state receive a modification approval free exercise of religion. U.S. Department of Health the Treasury’s monitoring and oversight that permits it to hold the post award & Human Services, Office for Civil Rights, Conscience and Religious Freedom, https:// of approved section 1332 waivers, the public forum virtually instead of in www.hhs.gov/conscience/index.html (last visited Secretary of HHS and the Secretary of person, the state must still publish the Aug. 20, 2020). the Treasury, at their discretion, notice of its post award public notice on

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the state’s public website and use other outbreak a ‘‘Public Health Emergency of temporary funding increase in that effective means to communicate the international concern.’’ On January 31, quarter. This provision of the IFC is required information to the public. The 2020, pursuant to section 319 of the immediately necessary to ensure that public notice must include the website, PHS, the HHS Secretary determined that states can determine eligibility and date, and time of the public forum that a PHE exists for the United States to aid provide care and services during the will be convened by the state, the nation’s health care community in PHE in a manner that is consistent with information related to the timeframe for responding to COVID–19. On , simplicity of administration and the comments, and how comments from the 2020, the WHO publicly declared best interests of beneficiaries and also public on the section 1332 waiver must COVID–19 a pandemic. On March 13, claim the temporary funding increase. be submitted. HHS and the Department 2020, the President declared the In this IFC, HHS and the Department of the Treasury remind states that they COVID–19 pandemic a national of the Treasury are setting forth still must also comply with Federal civil emergency. Effective October 23, 2020, flexibilities in the public notice and rights requirements, including laws the HHS Secretary renewed the January post award public participation pertaining to accessibility, if the 31, 2020 determination, which was requirements for a State Innovation Secretary of HHS and the Secretary of previously renewed on , 2020 Waiver described in section 1332 of the Treasury approve a modification and , 2020, that a PHE exists and PPACA during the PHE for COVID–19. from all or a portion of the post award has existed since January 27, 2020. This HHS and the Department of the public notice procedures. In such a declaration, along with the HHS Treasury recognize that following the circumstance, the state would need to Secretary’s January 30, 2020 declaration normal state and Federal public notice ensure these virtual public hearings are of a PHE, conferred on the HHS procedures and the state post award as accessible as possible during the PHE Secretary certain waiver authorities requirements for section 1332 waivers for COVID–19 so members of the public under section 1135 of the Act. On may impose barriers for states pursuing can participate and submit comments. March 13, 2020, the HHS Secretary a proposed waiver request during the The state should also track how many authorized waivers under section 1135 PHE for COVID–19. This guidance is 70 people are attending these forums, if of the Act, effective , 2020. intended to protect public health and It is critically important that the possible. prevent the spread of COVID–19 by Departments implement the policies in V. Waiver of Proposed Rulemaking limiting the need for in-person this IFC as quickly as possible. As the gatherings related to a section 1332 Section 553(b) of the APA requires the United States is in the midst of the PHE waiver. Additionally, states may face agency to publish a notice of the for COVID–19, the Departments find uncertainty as to whether their waiver proposed rule in the Federal Register good cause to waive notice of proposed requests will be approved in time to that includes a reference to the legal rulemaking under the APA, 5 U.S.C. expeditiously reform their health authority under which the rule is 553(b)(B). For those same reasons, as insurance markets and to protect proposed, and the terms and substance authorized by section 808(2) of the CRA, consumers from the effects of the PHE of the proposed rule or a description of the Departments find it is impracticable for COVID–19. Some states may not the subjects and issues involved. and contrary to the public interest not consider more robust changes because Section 553(c) further requires the to waive the delay in effective date of they were concerned that the current agency to give interested parties the this IFC under section 801 of the CRA. section 1332 waiver application opportunity to participate in the Therefore, the Departments find there is requirements are too time-consuming or rulemaking through public comment good cause to waive the CRA’s delay in burdensome to be helpful during the before the provisions of the rule take effective date pursuant to section 808(2) PHE for COVID–19. HHS and the effect. Section 553(b)(B) authorizes the of the CRA. Thus, the Departments find Department of the Treasury are of the agency to waive these procedures, good cause to waive the applicable view that the flexibility to modify however, if the agency finds good cause delays in the effective date and, certain public notice procedures and that notice and comment procedures are moreover, to establish these policies in participation requirements will increase impracticable, unnecessary, or contrary this IFC applicable as of the date of flexibility and reduce burden for states to the public interest and incorporates a display at the Office of the Federal seeking to use section 1332 waivers as statement of the finding and its reasons Register. a means of innovation for providing in the rule issued. In this IFC, consistent with section coverage, lowering premiums, and Section 553(d) ordinarily requires a 1902(a)(4) and (a)(19) of the Act, the improving their health care markets 30-day delay in the effective date of a Department adds a new subpart G to 42 during the PHE for COVID–19. As such, final rule from the date of its CFR part 433 to provide states with these flexibilities are immediately publication in the Federal Register. more flexibility, subject to certain necessary to provide states applying for This 30-day delay in effective date can safeguards, in implementing the a section 1332 waiver or during the post be waived, however, if an agency finds requirement in section 6008(b)(3) of the award period with the option to request good cause to support an earlier FFCRA that states maintain Medicaid a modification from the state and/or effective date. Finally, the Congressional beneficiary enrollment in order to Federal public notice requirements Review Act (CRA) requires a delay in receive the temporary increase in when a delay would undermine or the effective date for major rules unless Federal funding in the FFCRA. This compromise the purpose of the waiver an agency finds good cause that notice temporary funding increase is effective and be contrary to the interests of and public procedure are impracticable, beginning January 1, 2020 and could consumers. HHS and the Department of unnecessary, or contrary to the public extend through the last day of the the Treasury are of the view that it interest, in which case the rule shall calendar quarter in which the PHE for could be contrary to the public interest take effect at such time as the agency COVID–19, including any extensions, to require full notice and comment determines. 5 U.S.C. 801(a)(3), 808(2). terminates, if the state claims the As noted earlier in this preamble, on during the current PHE for COVID–19 January 30, 2020, the International 70 https://www.phe.gov/emergency/news/ because following the normal Health Regulations Emergency healthactions/section1135/Pages/covid19- timeframes and requirements could Committee of the WHO declared the 13March20.aspx. result in waiver approvals for

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innovative waivers taking effect after receive these services once they are public interest and impractical here as issuers have already made their recommended for the general public or it would delay access to a COVID–19 decisions regarding issuer participation specific high-risk or high-priority vaccine without cost sharing and be in the individual market and after rates populations. To help ensure full access contrary to the need to ensure access to for the upcoming plan year have been to and the widespread use of qualifying a COVID–19 vaccine for enrollees in submitted. A modification from the coronavirus preventive services to cost plans on the same basis as is public participation requirements mitigate the PHE for COVID 19, it is ensured for other Medicare would be beneficial to the public critical that individuals be able to beneficiaries. interest by providing states and the receive such services from any provider Further, as underscored by the Federal Government the flexibilities authorized to provide the service. This timeline for coverage Congress necessary to review and approve, as is consistent with the objectives of established in section 3203 of the appropriate, section 1332 waivers that Operation Warp Speed, which, as CARES Act, the need to provide expand access to coverage on a faster mentioned above, is a partnership coverage of qualifying coronavirus timeframe. among components of the Federal preventive services is urgent. Following In this IFC, the Departments amend Government that engages with private a recommendation of the USPTF or the regulations under section 2713 of firms to accelerate the development, ACIP, the requirement to provide the PHS Act to implement the manufacture, and distribution of a coverage without cost sharing of requirement in section 3203 of the COVID–19 vaccine to the American qualifying coronavirus preventive CARES Act that non-grandfathered people. services, which are expected to include group health plans and health insurance The provisions of this IFC therefore immunizations, takes effect within 15 issuers offering non-grandfathered are immediately necessary to ensure business days. Plans and issuers need group or individual health insurance group health plan and group and immediate guidance to understand their coverage provide coverage without cost individual health insurance coverage of obligations under section 3203 of the sharing for qualifying coronavirus these items and services is prompt and CARES Act and to take steps that will preventive services. This coverage must broad, to ensure timely access to combat enable them to comply with those be provided within 15 business days the pandemic. In this IFC, the requirements as soon as the coverage after the date on which a Department adds a requirement at requirement goes into effect. Delaying recommendation is made by the § 417.454 to require section 1876 cost these provisions would likewise delay USPSTF or ACIP. The Departments also establish in this IFC that this coverage plans to cover without cost sharing the plans’ and issuers’ ability to prepare for must be provided regardless of whether COVID 19 vaccine and its the availability of a COVID–19 vaccine, the service is delivered by an in- administration described in section resulting in barriers in access to network or out-of-network provider. 1861(s)(10)(A) of the Act without cost coverage of these critical services during The Departments are issuing these sharing for the duration of the PHE for the PHE for COVID–19. As of the date amendments under the authority of the COVID–19 pandemic, specifically of display of this regulation, there are section 9833 of the Code, section 734 of the end of the emergency period defined not any coronavirus preventive services ERISA, and section 2792 of the PHS Act. in paragraph (1)(B) of section 1135(g) of including vaccines for coronavirus that These sections authorize the Secretaries the Act, which is the PHE declared by are required to be covered. However, of the Treasury, Labor, and HHS to the Secretary on January 31, 2020 and because emergency use authorization or promulgate any interim final rules that any renewals thereof. While section approval of a COVID–19 vaccine may be the Secretaries determine are 1876(c)(2) of the Act ensures that imminent, the Departments are of the appropriate to carry out the provisions enrollees in Medicare cost plans will view it is critical that these regulations of chapter 100 of the Code, part 7 of have coverage of a COVID–19 vaccine under section 2713 of the PHS Act be subtitle B of title I of ERISA, and part and its administration, section 3713 of issued and effective prior to such A of title XXVII of the PHS Act, which the CARES Act did not amend section authorization or approval. The include PHS Act sections 2701 through 1876 of the Act to provide similar cost- Departments are of the view that it 2728 and the incorporation of those sharing protections for enrollees in cost would be impracticable and contrary to sections into ERISA section 715 and plans who receive the vaccine from an the public interest to undertake normal Code section 9815. In addition, section in-network provider. Currently, there is notice and comment rulemaking 7805(e) of the Code restricts any no requirement for cost plans to cover procedures in light of the urgent need to temporary regulation issued by Treasury the COVID–19 vaccine and its ensure coverage of and access to and the IRS under the Code, such as administration without cost sharing qualifying coronavirus preventive interim final regulations, to a duration (that is, with cost sharing that is the services to protect the public health as of 3 years. same as original Medicare) when the well as the health and safety of Several COVID–19 vaccine candidates vaccine is furnished by an in-network individuals and communities to prevent are currently in late-stage development. health care provider. This provision of the spread of COVID–19. For these same Once a vaccine is authorized or the IFC is immediately necessary to reasons, the Departments are of the view approved by FDA, the Departments ensure that cost plan enrollees, like a delayed effective date would also be expect that ACIP may move other Medicare beneficiaries, are contrary to the public interest. Ensuring expeditiously to recommend the provided access to the COVID–19 individuals have access to a COVID–19 immunization. In addition, unlike other vaccine and its administration without vaccine as soon as it becomes available preventive items and services typically cost sharing. This immediate action will is critical to ending the PHE for COVID– provided according to regularly ensure that cost is not a barrier for 19, and therefore it is imperative that scheduled intervals, items and services beneficiaries to get the vaccine, these regulations are in effect on the intended to prevent or mitigate COVID– particularly during the public health date such a vaccine becomes available 19 will not, in the immediate future, be emergency when ensuring access is and recommended by ACIP. provided as part of a usual course of paramount importance. The delay Undertaking the standard rulemaking preventive care. Instead, the necessary for notice and comment process of publishing a proposed rule, Departments expect consumers to rulemaking is both contrary to the seeking public comment, carefully

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analyzing those public comments, and we believe it would be impracticable products could be packaged into a subsequently publishing a final rule and contrary to the public interest to Comprehensive Ambulatory Payment would possibly and perhaps likely undertake normal notice and comment Classification (C–APC) payment when jeopardize such an effective date. rulemaking procedures and to delay the provided on the same claim as a C–APC The Departments are of the view that effective date of the new requirements service, in which case separate payment it would be impracticable and contrary being adopted at 45 CFR part 182. would not be made for these products. to the public interest to undertake In this IFC, the Department creates a Although we do not expect that many normal notice and comment procedures New COVID–19 Treatments Add-on beneficiaries would both receive a and to thereby delay the effective date Payment (NCTAP) under the Inpatient primary C–APC service and a drug or of this IFC. The Departments find good Prospective Payment System (IPPS) for biological for treating COVID–19, we cause to waive notice of proposed COVID–19 cases that meet certain nonetheless believe that as drugs or rulemaking under the APA, 5 U.S.C. criteria. The Department is of the view biologicals become available and are 553(b)(B). For those same reasons, as that it would be impracticable and authorized or approved for the authorized by section 808(2) of the CRA, contrary to the public interest to treatment of COVID–19 in the outpatient the Departments find it is impracticable undertake normal notice and comment setting, it would be appropriate to and contrary to the public interest not procedures and to thereby delay the mitigate any potential financial to waive the delay in effective date of effective date of this IFC. As drug and disincentives for hospitals to provide this IFC under section 801 of the CRA. biological products become available these new treatments during the PHE for Therefore, the Departments find there is and are authorized or approved by FDA COVID–19. The delay necessary for good cause to waive the CRA’s delay in for the treatment of COVID–19 in the notice and comment rulemaking to effective date pursuant to section 808(2) inpatient setting, there may be potential address this issue is both contrary to the of the CRA. The provisions in this IFC financial disincentives for hospitals to public interest and impracticable will go into effect on the date of display. provide these new COVID–19 because of the urgency in ensuring there This IFC implements the requirement treatments to Medicare inpatients are not financial disincentives for that providers of diagnostic tests for during the PHE because the costs of hospitals to provide COVID–19 COVID–19 make public their cash prices these new treatments are not yet treatments to beneficiaries. Therefore, for COVID–19 diagnostic tests and reflected in Medicare payment rates and effective for services furnished on or specifies the COVID–19 diagnostic tests there are no new technology add-on after the effective date of this rule and to which this requirement applies. This payments for these treatments. The until the end of the PHE for COVID–19, IFC further defines ‘‘provider of a delay necessary for notice and comment CMS is creating an exception to its diagnostic test for COVID–19’’ (referred rulemaking is both contrary to the OPPS C–APC policy to ensure separate to as ‘‘provider’’) as any facility that public interest and impracticable payment for new COVID–19 treatments performs one or more COVID–19 because of the urgency in ensuring there that meet certain criteria. diagnostic tests. In addition, this IFC are not financial disincentives for In this IFC, the Department adds defines ‘‘cash price’’ as the charge that hospitals to provide COVID–19 changes to the CJR model that are applies to an individual who pays cash treatments to beneficiaries during the immediately necessary to continue the (or cash equivalent) for a COVID–19 PHE. We expect that increasing the CJR model consistent with model goals diagnostic test. This IFC gives CMS current IPPS payment amounts for to, cover inpatient major lower joint discretion to take any of the following sufficiently costly cases to mitigate replacements without interruption, and actions if CMS determines a provider is potential financial disincentives for to reduce operational and financial noncompliant with the requirements of hospitals to provide new COVID–19 uncertainty for CJR hospital participants new 45 CFR 182.50: treatments during the PHE will during and beyond the PHE. Ending on • Provide a written warning notice to potentially improve and speed access to March 31, 2021 would be disruptive to the provider of the specific violation(s). these treatments for Medicare patients. hospitals and patient care during the • Request that a provider submit and We also believe that the establishment PHE. The end date of March 31, 2021, comply with a CAP. of the NCTAP provides greater means hospitals stop initiating episodes • Impose a CMP on the provider if the transparency and predictability to the under the model after , 2021, provider fails to respond to CMS’ public, including innovators that are before the end of the public health request to submit a CAP or to comply developing new COVID–19 treatments, emergency as renewed on October 23, with the requirements of a CAP as to how Medicare payments for cases 2020.71 Extending the model through an approved by CMS. involving these treatments will be additional six months of performance As indicated above, these determined when those treatments year (PY) 5, so that PY 5 now ends on requirements are applicable during the become available. September 30, 2021, provides PHE for COVID–19 (and any extensions In this IFC, the Department assures participant hospitals with greater to the PHE for COVID–19); therefore, it separate payment for new COVID–19 certainty in model operations during the is critically important that we treatments provided in the outpatient remainder of the PHE. implement the policies in this IFC as setting for the remainder of the Public Through this IFC we are quickly as possible in order for Health Emergency for COVID–19. The implementing four changes to the CJR stakeholders to know with certainty Department is of the view that it would model needed to extend PY 5. These during the PHE for COVID–19 how to be impracticable and contrary to the are: (1) Extending PY 5 an additional 6 comply with the law and what penalties public interest to undertake normal months to provide for continuity of they will face for noncompliance during notice and comment procedures and to model operations with the same scope the PHE for COVID–19. Moreover, these thereby delay the effective date of this while we continue to consider rules are necessary for CMS to enforce IFC. We anticipate that most drugs and comments received on our proposal to section 3202(b) of the CARES Act and biological products authorized or extend the model to PYs 6 through 8 to ensure plans, issuers, and consumers approved for use in treating COVID–19 and adopt other changes to the model know in advance the price for a in the outpatient setting would be diagnostic test for COVID–19 during the separately paid under our standard 71 https://www.phe.gov/emergency/news/ PHE for COVID–19. For these reasons, OPPS payment policy; however, these healthactions/phe/Pages/covid19-2Oct2020.aspx

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(42 CFR 510.2 and 510.200(a)); (2) with comment specifies an end for the A. ICRs for Price Transparency for making changes to the reconciliation current extreme and uncontrollable COVID–19 Diagnostic Tests process for PY 5 to allow for two adjustment in 42 CFR 510.300(k)(4). In As discussed in section II.C of this periods and to enable more frequent order to provide participant hospitals IFC, section 3202(b) of the CARES Act receipt of reconciliation reports by continuing financial protection from the establishes a requirement to publicize participants (42 CFR 510.2, 42 CFR effect of COVID–19 on the CJR model cash prices for COVID–19 diagnostic 510.200, 42 CFR 510.305(b), (d)(1), (e), that may continue beyond the end of the tests during the PHE. For purposes of (i)(1) and (2), and (j)(1) and (2), and 42 PHE for COVID–19 or March 31, 2021, implementing section 3202(b) of the CFR 510.400(b)(3)(v), and adding 42 whichever occurs earlier, we are CARES Act, we are adding new 45 CFR CFR 510.400(b)(3)(vi)); (3) making a implementing that actual episode part 182, ‘‘Price Transparency for technical change, retroactive to October payments are capped at the quality COVID–19 Diagnostic Tests,’’ that will 1, 2020, to ensure that the model adjusted target price determined for that codify price transparency requirements continues to include the same inpatient episode under § 510.300 for episodes for the performance of a COVID–19 Lower Extremity Joint Replacement with actual episode payments that diagnostic test. (LEJR) procedures, despite the adoption include a claim with a COVID–19 There are several types of COVID–19 of new MS–DRGs to describe those diagnosis code and initiate after the tests designed to detect SARS-CoV–2 or procedures (42 CFR 510.300(a)(1)(i) and earlier of March 31, 2021 or the last day to diagnose a possible case of COVID– (iii)); and (4) making changes to the of the emergency period. This policy is 19, including: molecular (RT–PCR) tests, extreme and uncontrollable which are used to detect the virus’s consistent with flexibilities and circumstances policy for COVID–19 to genetic material; antigen tests, which protections for impact of COVID–19 in adapt to an increase in CJR episode are used to detect specific proteins on other Innovation Center models. For all volume and renewal of the PHE, while the surface of the virus; and serology providing protection against financial of these revisions, we believe it is testing, which is used to look for the consequences of COVID–19 after the contrary to the public interest to presence of antibodies produced by the extreme and uncontrollable undertake traditional notice and body in response to infections. circumstances policy no longer applies comment rulemaking to adopt these For purposes of 45 CFR part 182, we (42 CFR 510.300). regulatory changes because they are defining ‘‘provider of a diagnostic preserve the model’s scope and Implementing an additional six test for COVID–19’’ as any facility that operations at current levels, fostering months of PY 5, so that PY 5 now ends performs one or more COVID–19 model stability now and in the future on September 30, 2021 (hospitals stop diagnostic tests. In order to perform a initiating new episodes under the model for hospital operations during and diagnostic test for COVID–19 and report after , 2021) provides participant beyond the PHE. patient-specific results, a facility hospitals additional relief and stability VI. Collection of Information (whether that be a primary care provider’s office, urgent care center, in model operations while the end of Requirements the PHE remains unknown. We have outpatient hospital site or stand-alone modified the reconciliation process to Under the Paperwork Reduction Act laboratory) is required to hold a CLIA provide payments consistent with the of 1995, the Departments are required to certificate based on the complexity of current annual reconciliation schedule provide 30-day notice in the Federal the testing performed by the facility. for hospitals for greater stability. Absent Register and solicit public comment Therefore, we expect that any ‘‘provider modification to the reconciliation before a collection of information of a COVID–19 diagnostic test’’ would process, the extension of PY 5 to a total requirement is submitted to OMB for hold a CLIA certificate (including a of 21 months, from January 1, 2020 review and approval. In order to fairly certificate of waiver or certificate of through September 30, 2021 would evaluate whether an information registration) and that such testing would mean that participant hospitals would collection should be approved by OMB, occur in facilities ranging from primary experience a 21-month gap between the section 3506(c)(2)(A) of the Paperwork care provider offices to urgent care PY4 final reconciliation in June of 2020 Reduction Act of 1995 (PRA) requires centers to stand-alone national and initial PY 5 reconciliation in early that the Departments solicit comment laboratories. As explained in section VIII.B of this 2022. In the FY 2021 IPPS/LTCH final on the following issues: rule, we stated that because the CJR IFC, we estimate that approximately • The need for the information model would continue until at least 83,309 CLIA providers could potentially collection and its usefulness in carrying March 31, 2021, we intended to adopt be performing COVID–19 diagnostic out the proper functions of the agency. a policy in the CJR final rule that tests and need to publicize their cash incorporates new MS–DRGs for the • The accuracy of the estimate of the prices. For purposes of this IFC, we are same procedures currently included in information collection burden. estimating it will take a business operations specialist (13–1000), on the CJR model, under prior MS–DRGs, • The quality, utility, and clarity of average 1 hour for a total of 83,309 as of their effective date to avoid the information to be collected. disruption to the model for the burden hours to compile and make • Recommendations to minimize the remainder of PY5 (as extended) and public the cash prices for COVID–19 information collection burden on the thereafter, if our proposal to extend the diagnostic tests, at an hourly wage of affected public, including automated CJR model through PY8 were finalized $36.31 as published by the BLS in 72 (85 FR 58502). We are adopting the collection techniques. 2019. We estimate the overhead and change in this IFC, retroactive to The Departments are soliciting public fringe benefit cost to be 100 percent of October 1, 2020 because without a comment on each of the section wages. Therefore, we estimate a one- change the model ceases to continue as 3506(c)(2)(A)-required issues for the time cost per provider to be $72.62 a comprehensive joint replacement following information collection requirements (ICRs). The requirements 72 Bureau of Labor Statistics. National model. Not making this change would Occupational Employment and Wage Estimates, have a significant impact on operational and burden will be submitted to under May 2019. Available at: https://www.bls.gov/oes/ stability. Finally, this interim final rule OMB Control Number 0938–NEW. current/oes_nat.htm#13-0000.

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($36.31 × 2) and the total cost estimated from the Federal public notice determination on their website within to be $6,049,900 (83,309 hours × $72.62) procedures and the alternative public 15 days of the approval. HHS and the to collect, compile and post the required notice procedures it requests to be Department of Treasury estimate that for information. implemented at the Federal level, as each state, it will take a network and applicable. computer systems administrator 15 B. ICRs for State Innovation Waivers A state with an approved section 1332 Policy and Regulatory Revision in minutes to post the approval with an waiver can submit a request to HHS and equivalent cost of approximately $21.74 Response to COVID–19 Public Health the Department of Treasury for a Emergency Assuming that approximately 15 states modification from post award public will submit a modification request, the This IFC provides that states are notice procedures. The request must total burden hours for all states will be required to submit modification specify the reason the state seeks a 15 hours, with an equivalent cost of requests to the Secretary of HHS and the modification from the post award public approximately $1,775. HHS and the Secretary of the Treasury in order to notice procedures, describe how the Department of Treasury have assumed obtain approval for the modifications state meets the modification criteria, that 15 states will submit a request made available by this IFC. Any state and describe the alternative procedures because, as of display of this IFC, 15 can submit a request to the Secretaries it proposes to implement at the state states have an approved 1332 waiver. for a modification from the state and/or level, including public hearings, that are Federal public notice procedures or designed to provide the greatest This is an upper bound, since some include such a request in their section opportunity and level of meaningful states may not need to request the 1332 waiver application if the waiver public input from impacted available modification for their waivers, application is submitted during the PHE stakeholders that is practicable given and therefore, will incur no burden. for COVID–19. The request must the emergency circumstances Furthermore, assuming that describe the reason the state seeks a underlying the state’s request for a approximately 15 states receive modification from the state public modification. approval of the modification request notice procedures, describe how the While HHS and the Department of and then must post the approval, the state meets the modification criteria, Treasury do not have data available to total burden hours for all states will be describe the alternative public notice predict the number of states that will approximately 3.75 hours, with an procedures it proposes to implement at likely request a modification of either equivalent cost of approximately $319. the state level, including public the waiver application or the post award This is an upper bound, since some hearings, that are designed to provide public notice procedures, HHS and the states may not receive approval, and the greatest opportunity and level of Department of Treasury estimate it will therefore, will incur a lower (or no) meaningful public input from impacted take a senior manager 1 hour to prepare burden. The total estimated burden stakeholders that is practicable given a state’s request, with an equivalent cost hours assuming approximately 15 states the emergency circumstances of approximately $118.73 In addition, if apply for and receive approval of the underlying the state’s request for a HHS and the Department of Treasury modification request is 18.75 hours, modification. The request must describe approve a state’s modification request, with an equivalent cost of the reason the state seeks a modification the state will have to post the approximately $2,094.

TABLE 3—ESTIMATED COST AND BURDEN HOURS PER RESPONDENT

Average burden hour BLS occupation per Hourly wage Total cost per respondent rates respondent (in 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

Burden hours Number of Number of per Total burden Total cost respondents responses respondent hours

Modification Request ...... 15 15 1 15 $1,775 Posting modification approval ...... 15 15 0.25 3.75 319

Total ...... 15 ...... 1.25 18.75 2,094

73 Using data from the Bureau of Labor Statistics for overhead and fringe benefits. https:// we estimate that the average hourly labor cost will (BLS) for General and Operations Managers (Code www.bls.gov/oes/current/oes_stru.htm. be $85.02, including 100 percent increase for 11–1020), we estimate that the average hourly labor 74 Using data from the BLS for Network and overhead and fringe benefits. https://www.bls.gov/ cost will be $118.30, including 100 percent increase Computer Systems Administrators (Code 15–1244), oes/current/oes_stru.htm.

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C. ICRs Regarding the Comprehensive or supplier such as a physician, non- PRA exemption we are claiming for the Joint Replacement (CJR) Model physician practitioner, hospital appeals process. outpatient department, home health Section 1115A(d)(3) of the Social agency, or skilled nursing facility. 1. Cost of Completing Form CMS–855B Security Act exempts the Center for However, an entity that does not Medicare and Medicaid Innovation Using our internal data, we generally otherwise qualify as a Medicare estimate that approximately 60,000 (CMMI) model tests and expansions, provider or supplier but wishes to entities (the preponderance of which from the PRA. The section provides that furnish mass immunization services will be pharmacies) will seek to enroll Chapter 35 of title 44, United States may be eligible to enroll in Medicare as Code, which includes such provisions a ‘‘Mass Immunization Roster Biller’’ via as mass immunization roster billers as the PRA, shall not apply to the testing the Form CMS–855B enrollment pursuant to the IFC, all of whom will and evaluation of CMMI models or application (Medicare Enrollment attempt enrollment in the 12-month expansion of such models. Application: Clinics/Group Practices period following the IFC’s display. According to the most recent wage data D. ICRs Regarding Enrollment as Mass and Certain Other Suppliers; OMB provided by the Bureau of Labor Immunization Roster Biller Control No.: 0938–0685; Expires 12/21). This section discusses our burden Statistics (BLS) for May 2019 (see http:// As discussed in section II.A.1. of this estimates for the enrollment of mass www.bls.gov/oes/current/oes_nat.htm), IFC, a mass immunizer may be enrolled immunization roster billers via the Form the mean hourly wages for the following in Medicare as another type of provider CMS–855B application as well as the categories are:

TABLE 5—NATIONAL OCCUPATIONAL EMPLOYMENT AND WAGE ESTIMATES

Mean hourly Fringe benefits Adjusted Occupation title Occupation wage and overhead hourly wage code ($/hr) ($/hr) ($/hr)

Healthcare Diagnosing or Treating Practitioners ...... 29–1000 49.26 49.26 98.52 Medical Secretaries and Administrative Assistants ...... 43–6013 18.31 18.31 36.62

Consistent with Form CMS–855B developed burden estimates. We also consumers in the individual and small projections made in recent rulemaking believe that any costs associated with group (or merged) market during the efforts, it will take each entity an mass immunization roster biller PHE for COVID–19. This IFC also average of 2.5 hours to obtain and enrollment will, in any event, be de implements section 3202(b) of the furnish the information on the Form minimis; this is because we anticipate, CARES Act, which requires that CMS–855B. Per our experience, the based on past experience, there would providers of COVID–19 diagnostic tests entity’s medical secretary will secure be comparatively few denials and make public their cash prices for those and report this data, a task that would revocations of such enrollments. tests and establishes an enforcement take approximately 2 hours. scheme to enforce those requirements Response to Comments Additionally, a health diagnosing and during the PHE for COVID–19. treating practitioner of the entity will Because of the large number of public In section 3203 of the CARES Act, review and sign the form, a process we comments normally received on Federal Congress required group health plans estimate takes 30 minutes. We therefore Register documents, the Departments and issuers of group or individual project a total burden of 150,000 hours are not able to acknowledge or respond health insurance coverage to cover (60,000 suppliers × 2.5 hrs) at a cost of to them individually. All comments without cost sharing qualifying $7,350,000 (60,000 suppliers × ((2 hrs × received by the date and time specified coronavirus preventive services, and $36.62/hr) + (0.5 hrs × $98.52/hr)). in the DATES section of this preamble required such coverage to be provided When averaged over the typical 3-year will be considered, and, when the within 15 business days after the date OMB approval period, we estimate an Departments proceed with a subsequent on which an applicable annual burden of 50,000 hours (150,000 document, the Departments will recommendation is made relating to hrs/3) at a cost of $2,450,000 respond to the comments in the such service. The Departments codify ($7,350,000/3). preamble to that document. these requirements in this IFC, and 2. Appeals Regulatory Impact Analysis finalize amendments to the regulations implementing section 2713 of the PHS Pursuant to 42 CFR part 498, a mass A. Statement of Need Act at 26 CFR 54.9815–2713; 29 CFR immunization roster biller may appeal The flexibilities and changes 2590.715–2713; and 45 CFR 147.130 the denial or revocation of its contained within this IFC are responsive that are intended to help ensure full enrollment. While there are information to the PHE for COVID–19. The policies access to and the widespread use of collection requirements associated with implemented in this IFC will provide qualifying coronavirus preventive the appeals process, we believe they are flexibilities, during the PHE for COVID– services to mitigate the public health exempt from the PRA. In accordance 19, to states pursuing waivers under emergency. with the implementing regulations of section 1332 of the PPACA and to states B. Overall Impact the PRA at 5 CFR 1320.4(a)(2), the with approved section 1332 waivers. information collection requirements Additionally, the policies and The Departments have examined the associated with the appeals process are regulatory updates implemented in this potential impacts of this rule as required subsequent to an administrative action IFC will increase the affordability with by Executive Order 12866 on Regulatory (specifically, the denial or revocation of regards to section 1332 waiver Planning and Review (September 30, a mass immunization roster biller’s applications and support continuity of 1993), Executive Order 13563 on enrollment). Therefore, we have not health insurance coverage for Improving Regulation and Regulatory

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Review (, 2011), the C. Detailed Economic Analysis that equals the negotiated rate, or, if the plan or issuer does not have a Regulatory Flexibility Act (RFA) 1. Effect of Price Transparency for negotiated rate with the provider, the (, 1980, Pub. L. 96 354), COVID–19 Diagnostic Tests During the cash price for such service that is listed section 1102(b) of the Act, section 202 PHE of the Unfunded Mandates Reform Act by the provider on a public website. We of 1995 (March 22, 1995; Pub. L. 104– As discussed in section II.C of this anticipate that price transparency in IFC, Section 3202(b) of the CARES Act 4), Executive Order 13132 on COVID–19 diagnostic testing, in establishes a requirement to publicize Federalism (, 1999), the particular, will help improve clarity for cash prices for COVID–19 diagnostic consumers and the plans and issuers Congressional Review Act (5 U.S.C. tests during the PHE. For purposes of 804(2)), and Executive Order 13771 on that are required to cover the cost of implementing section 3202(b) of the performing a COVID–19 diagnostic test Reducing Regulation and Controlling CARES Act, we are adding new 45 CFR when there is no negotiated rate Regulatory Costs (January 30, 2017). part 182, ‘‘Price Transparency for between the plan or issuer and the Executive Orders 12866 and 13563 COVID–19 Diagnostic Tests,’’ that will provider. For individuals without direct agencies to assess all costs and codify price transparency requirements insurance and for health plans and benefits of available regulatory for the actual performance of a COVID– health insurance issuers attempting to alternatives and, if regulation is 19 diagnostic test. At § 182.20, we are negotiate a rate for performance of a necessary, to select regulatory defining a ‘‘COVID–19 diagnostic test’’ COVID–19 diagnostic test with a approaches that maximize net benefits as a COVID–19 in vitro diagnostic test provider that has posted its cash price, (including potential economic, described in section 6001 of the FFCRA, that cash price could provide some environmental, public health and safety as amended by section 3201 of the context and a baseline against which CARES Act. effects, distributive impacts, and those negotiations can occur. Moreover, This IFC defines a ‘‘provider of a equity). Section 3(f) of Executive Order price transparency in COVID–19 diagnostic test for COVID–19’’ (referred diagnostic tests will assist the uninsured 12866 defines a ‘‘significant regulatory to as ‘‘provider’’) as any facility that action’’ as an action that is likely to in determining the cash price at various performs one or more COVID–19 providers when price shopping for result in a rule: (1) Having an annual diagnostic tests. In order to perform a COVID–19 diagnostic tests. effect on the economy of $100 million COVID–19 diagnostic tests and report Assessments of broader transparency or more in any one year, or adversely patient-specific results, a facility is policies yield per-capita estimates of and materially affecting a sector of the required to hold a CLIA certificate based annual expenditure reductions ranging economy, productivity, competition, on the complexity of the testing from between $3 and $5 (= $2.8 million jobs, the environment, public health or performed by the facility. This IFC + $1.3 million + $7.0 million + $2.3 safety, or state, local or tribal requires providers of COVID–19 million two-year savings, across 1.3 governments or communities (also diagnostic tests to make public the cash million California public employees and referred to as ‘‘economically price for such tests on a public internet their family members, per Boynton and significant’’); (2) creating a serious website of such provider during the Robinson (2015)), to $6.50 (= $7.9 inconsistency or otherwise interfering emergency period declared under million + $36 million five-year savings with an action taken or planned by section 319 of the PHS Act. In the event found by Brown (2018), divided across another agency; (3) materially altering that a provider does not have its own the 1.36 million residents of New the budgetary impacts of entitlement website on which to post this cash price Hampshire), to $17 (= $13.2 million grants, user fees, or loan programs or the information, § 182.40(b) states that the three-year savings across 0.26 million provider would be required to make 75 rights and obligations of recipients beneficiaries, per Rhoads (2019)). If public its cash price information in thereof; or (4) raising novel legal or the $6.50 median result is extrapolated writing, within two business days upon policy issues arising out of legal from the context of general health request, and by posting signage spending—which is approximately mandates, the President’s priorities, or prominently at the provider’s COVID–19 $10,000 per capita in the United the principles set forth in the Executive diagnostic testing location, if such States—to a range of between $60 and Order. location is accessible to the public. $1,200 in COVID–19 diagnostic testing A regulatory impact analysis (RIA) We anticipate that price transparency (= $60 per test, across between one and must be prepared for major rules with has potential beneficial marketplace 20 tests), the estimate of rule-induced economically significant effects ($100 benefits generally, as discussed in detail reductions in annual consumer million or more in any one year), and in the CY 2020 Hospital Outpatient PPS expenditures could range from $13 a ‘‘significant’’ regulatory action is Policy Changes and Payment Rates and million to $254 million. (This subject to review by the OMB. The Ambulatory Surgical Center Payment expenditure change combines transfers Departments have determined that these System Policy Changes and Payment (to patients or insurers from providers) rules are likely to have economic Rates, Price Transparency Requirements for Hospitals To Make Standard Charges 75 impacts of $100 million or more in at Boynton, A., and Robinson, J. ‘‘Appropriate Public Final Rule (84 FR 65524) and the Use of Reference Pricing Can Increase Value.’’ least one year, and thus, meet the Transparency in Coverage Proposed Health Affairs Blog. , 2015. Available at: https://www.healthaffairs.org/do/10.1377/ definition of ‘‘economically significant’’ Rule (84 FR 65464). As noted in section under Executive Order 12866 and a hblog20150707.049155/full/. Brown, Z. Y. II.C of this IFC, section 3202 of the ‘‘Equilibrium Effects of Health Care Price major rule under the Congressional CARES Act addresses reimbursement of Information.’’ 100 Rev. of Econ. and Stat. 1. , Review Act. Therefore, the Departments COVID–19 diagnostic tests. Section 2018. Available at: http://www-personal.umich.edu/ have provided an assessment of the ∼zachb/zbrown_eqm_effects_price_ 3202(a) of the CARES Act requires transparency.pdf. Rhoads, J. ‘‘Right to Shop for potential costs, benefits, and transfers group health plans and issuers that Public Employees: How health care incentives are associated with this rule. In accordance provide coverage for items and services saving money in Kentucky.’’ The Dartmouth with the provisions of Executive Order Institute for Health Policy and Clinical Practice. described in section 6001(a) of the , 2019. Available at: https://thefga.org/wp- 12866, this regulation was reviewed by FFCRA to reimburse any provider of a content/uploads/2019/03/RTS-Kentucky- OMB. COVID–19 diagnostic test an amount HealthCareIncentivesSavingMoney-DRAFT8.pdf.

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with potential societal resource cost 2. Effects of Medicare Inpatient when these treatments are provided at savings; only the latter portion should Prospective Payment System (IPPS) the same time as a Comprehensive be compared against estimates of the New COVID–19 Treatments Add-on Ambulatory Payment Classification (C– provision’s administrative and Payment (NCTAP) for the Remainder of APC) service. As we noted in Section paperwork costs.) We note, however, the Public Health Emergency (PHE) II.E.2, we believe it would be a fairly that this estimate is based on annual As drug and biological products rare occurrence that an outpatient expenditure reductions; because this become available and are authorized or department would perform a C–APC requirement is only applicable for the approved by FDA for the treatment of procedure on a beneficiary being treated remainder of the PHE, which may be COVID–19 in the inpatient setting, there for COVID–19 because most C–APCs are for surgical or other intensive less than a year, the saving impact is may be potential financial disincentives procedures and we would expect most likely to be lower. for hospitals to provide these new hospital outpatients departments would To comply with the regulatory COVID–19 treatments to Medicare not perform outpatient surgery on a updates in this IFC, providers would inpatients during the PHE because the patient that has an active case of need to review their billing practices costs of these new treatments are not yet COVID–19. While it is possible that and determine their ‘‘cash price’’ for reflected in Medicare payment rates and future COVID–19 treatments that are COVID–19 diagnostic tests. They would there are no new technology add-on authorized or approved for use in the further need to publicly post the cash payments for these treatments. We outpatient setting might be administered prices for all COVID–19 diagnostic tests expect that increasing the current IPPS along with associated plain language to patients under observation while the payment amounts for sufficiently costly provider determines if the patient needs descriptions and HCPCS or CPT billing cases to mitigate potential financial codes. The provider would be required to be admitted to the hospital for disincentives for hospitals to provide COVID–19, it is our expectation that this to make all of this information public on new COVID–19 treatments during the hypothetical situation would not the provider’s internet website. As PHE will potentially improve and speed happen frequently. Because we believe discussed in section VI.C, we estimate it access to these treatments for Medicare a new COVID–19 treatment will rarely would take a Business Operations patients. We also believe that the be provided on the same claim as a Specialist, on average 1 hour to compile establishment of the NCTAP provides primary C–APC service, we believe new and make public the cash prices for the greater transparency and predictability COVID–19 treatments used in the COVID–19 diagnostic tests that the to the public, including innovators that outpatient setting will be separately facility offers at an hourly wage of are developing new COVID–19 paid under current policy the vast $36.31 as published by the 2019 Bureau treatments, as to how Medicare 76 majority of the time. As a result, we of Labor Statistics. We estimate the payments for cases involving these believe any budgetary effect of this new overhead and fringe benefit cost to be treatments will be determined when exception is likely to be de minimis. 100 percent of wages. Therefore, we those treatments become available. estimate a one-time cost per provider to Given it is unknown what the cost 4. Effects of Temporary Increase in be $72.62 (36.31 × 2). and utilization of inpatient stays using Federal Medicaid Funding We expect that approximately 30 these new treatments will be, the net This IFC interprets the requirement in percent 77 (n = 83,309) of the total CLIA- overall cost of the NCTAP policy is not section 6008(b)(3) of the FFCRA that certified laboratories (n = 277,699 78) estimable. On one extreme, if all of the states maintain Medicaid beneficiary could potentially be performing COVID– new COVID–19 treatments decrease the enrollment as a condition of receiving 19 diagnostic tests and need to publicize net cost of hospitalizations (for example, the temporary FMAP increase described their cash prices in such form and due to shortened lengths of stay), at section 6008(a) of the FFCRA. This manner as prescribed in new 45 CFR including the cost of the new treatment, IFC provides states with greater part 182 during the PHE for COVID–19, below the Medicare payment as flexibility than current CMS guidance to including any subsequent renewals. The increased by section 3710 of the CARES transition beneficiaries between total cost is estimated to be $ $6,049,900 Act then there would be no NCTAP eligibility groups, to modify the amount, (83,309 hours × $72.62) to collect, payments made and no additional cost duration, and scope of coverage compile and post the required to the Medicare program as a result of available to beneficiaries, and to make information. this policy. On the other extreme, if all changes to applicable cost sharing and We seek comment on the burden of the new COVID–19 treatments result beneficiary liability. At the same time, estimate for providers of a diagnostic in the net cost of hospitalizations that this IFC protects beneficiary access to test for COVID–19, specifically the exceed the outlier threshold (for medical assistance by requiring states to number of burden hours estimated to example, due to the cost of the new maintain each beneficiary’s coverage in post their cash price for COVID–19 treatment), the cost to the Medicare one of three tiers, thereby protecting diagnostic test. program would be the sum over all access to the basic coverage a NCTAP cases of 0.65 times the outlier beneficiary was receiving as of or after

76 threshold for each case. March 18, 2020. Bureau of Labor Statistics. National We anticipate that this IFC will result Occupational Employment and Wage Estimates, 3. Effects of the Medicare Outpatient May 2019. Available at: https://www.bls.gov/oes/ in lessened financial burden on state current/oes_nat.htm#13-0000. Prospective Payment System (OPPS) Medicaid agencies and the Federal 77 Consistent with the percent of laboratories Separate Payment for New COVID–19 Government as compared to CMS’s required to report COVID–19 diagnostic test results Treatments Policy for the Remainder of existing interpretation of the FFCRA in CMS–3401–IFC. the Public Health Emergency (PHE) for 6008(b)(3) requirement. It would be 78 As of , 2020, according to the COVID–19 Certification and Survey Provider Enhanced highly challenging to estimate specific Reporting system this includes Certificate of Waiver This IFC provides for separate cost savings resulting from this IFC (210,669), Certificate of Provider-Performed payment for New COVID–19 Treatments because such an estimate would be Microscopy (31,992), Certificate of Compliance (19,044) and Certificate of Accreditation (15,994). under the Outpatient Prospective almost entirely dependent on state Available at: https://qcor.cms.gov/CLIA_ Payment System (OPPS) for the behavior under the unique wizard.jsp?which=4&report=active_CLIA.jsp. remainder of the PHE for COVID–19 circumstances of the PHE for COVID–

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19. First, we believe that some savings charge under section 6008(b)(4) of the confluence of factors affecting may result from transitioning FFCRA if they are claiming the payments, including episode volume, beneficiaries to different eligibility temporary FMAP increase), or they may actual episode costs, and even target groups with greater cost sharing or need to meet additional prior prices, we cannot confidently estimate beneficiary liability. However, we know authorization or medical necessity cost or savings associated with the CJR that states have faced both system and requirements. model changes in this final rule, operational constraints that may prevent specifically, the provisions: to add them from processing routine actions, 5. Effects of Updates to the reconciliation periods to PY 5, to add such as transitioning a beneficiary from Comprehensive Care for Joint MS–DRGs 521 and 522 to the episode one group to another following a change Replacement (CJR) Model, Performance definition, to change the extreme and in circumstances. A state that has been Year (PY) 5 During the PHE uncontrollable circumstances policy, processing eligibility renewals and The evolving impact of the PHE for and to extend PY5 6 months. We will redeterminations during the PHE may the COVID–19 has created difficulties in continue to refine this analysis. If the be able to make such transitions forecasting the state of the LEJR market February 2020 proposed rule is finalized relatively quickly, while a state that has for 2021. For example, Table 1 indicates after review and response to comment, been unable to process changes without CJR episode volume increasing and we will strive to provide a more detailed violating the requirements for receiving moving back toward traditional levels estimate for future model performance the temporary FMAP increase may need from April to June, but then decreasing years. more time to begin transferring again in July and August. It is difficult 6. Effects of Rapid Coverage of beneficiaries between groups. to predict the impact of extending PY 5 Preventative Services for Coronavirus Second, we anticipate that states will an additional 6 months with the implement the new flexibilities offered amended policies described above This IFC requires that non- by this rule in a variety of ways and to because there exists a potential for grandfathered group health plans and different degrees. States may, for variation between PY 5 target prices and health insurance issuers offering non- example, look for cost savings through PY 5 actual episode costs (as a result of grandfathered group or individual the elimination of an optional benefit, COVID–19) which creates uncertainty in health insurance coverage provide establishing new copayments for calculating anticipated net coverage for qualifying coronavirus services that are unrelated to the PHE, reconciliation amounts for PY 5. As a preventive services, including or increasing beneficiary liability for result, the Office of the Actuary was recommended COVID–19 institutional care through a reduction to unable create projections regarding immunizations and their the personal needs allowance. Because Medicare program spending in 2021 for administration, without any cost each state’s financial situation is unique MS–DRGs 469, 470, 521, or 522 or sharing. It also requires plans and and the characteristics of each Medicaid discrete impact estimates regarding the issuers to provide coverage within 15 program are different, it is difficult to effect of extending CJR PY 5 an business days after the date on which an predict how states will respond to this additional 6 months with the amended applicable recommendation is made by IFC. While one state may elect to policies described above. In assessing USPSTF or ACIP relating to such a implement just one cost saving the potential cost or savings for this service. In addition, it requires that flexibility, another state may utilize all extension, CMMI internal analysis during the PHE for COVID–19 a group available options, and yet another state considered the following data points. health plan or issuer that has a network of providers to provide coverage may elect not to make any program First, the Second Annual CJR Evaluation without cost sharing regardless of changes. Based on the recent feedback Report,79 indicates participant hospitals whether the service is delivered by an we have received from states, we do reduced spending by 3.7 percent in-network or out-of-network provider. anticipate that some states will (difference in claims) during the first 2 Making these qualifying coronavirus implement some of these cost saving years of the CJR model. Additionally, if preventive services, including COVID– measures, which will result in the episode definition policy were not 19 immunizations, available without decreased financial burden for states amended to include the new MS–DRGs any delay is in the interest of public and cost savings for the Federal and fracture episodes were no longer health, as making these services Government. included in the CJR episode definition While our current interpretation of available as quickly as possible may October 1, 2020—March 31, 2021, section 6008(b)(3) of the FFCRA encourage individuals to take advantage episode volume would decrease provides the strongest protections for of these services and therefore may slow significantly and the cost saving effect beneficiary access to coverage, the the transmission of COVID–19. Access safeguards established by this IFC will of the CJR model would be limited to to qualifying coronavirus preventive ensure that all beneficiaries maintain only non-fracture episodes, which are services without cost sharing will the same basic level of access to generally the less costly episodes. We encourage more individuals to obtain coverage that they were receiving as of also know that while the CJR model them. Increased use of qualifying or after March 18, 2020. All achieves program savings, this coronavirus preventive services may beneficiaries who had access to observation is not net of reconciliation reduce the transmission and spread of minimum essential coverage will payments and administrative costs. the disease and thus potentially result maintain access to such coverage, and Further, our February 2020 proposed in better overall health outcomes. In the every beneficiary who had access to rule (85 FR 10516) proposes payment immediate term, newly developed testing services and treatment for methodology revisions to the target qualifying coronavirus preventive COVID–19, including vaccines, will price methodology to improve payment services might be available from a retain such access. Individual accuracy as the current methodology narrower range of providers than other, beneficiaries may be required to pay tends to excessive payment. Given the more established recommended cost sharing that they were not preventive items and services. If 79 CMS Comprehensive Care for Joint previously charged (except with respect Replacement Model: Performance Year 2 Evaluation COVID–19 immunizations require to testing and treatment services related Report Available at https://innovation.cms.gov/ specialized storage and administration to COVID–19, which states cannot files/reports/cjr-secondannrpt.pdf. services, only a limited number of

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providers may be able to offer them at they usually obtain health care services, modify, in part, the public notice first. If consumers have to incur consumers are likely to receive the procedures outlined in 31 CFR 33.112 additional burdens, long wait times, and services from an in-network provider. and 33.116 and 45 CFR 155.1312 and increased travel times to find an in- Plans and issuers may also wish to 155.1316 to expedite a decision on a network provider that can provide such educate participants, beneficiaries, or proposed section 1332 waiver request services, it will limit access and enrollees about the availability of the during the PHE for COVID–19. discourage them from obtaining such services from in-network providers and Regulations at §§ 33.112 and 155.1312 services. Therefore, the Departments are encourage them to obtain these services require a state to provide a public notice of the view that requiring out-of- from their usual providers. This and comment period at the state level network coverage without cost sharing approach could limit the number of prior to submitting an application for a for qualifying coronavirus preventive participants, beneficiaries, or enrollees section 1332 waiver. The regulations at services will help ensure that going to out-of-network providers §§ 33.116 and 155.1316 establish consumers are able to obtain the instead of staying in network, but there Federal public notice requirements for preventive services without cost sharing will be associated administrative state section 1332 waiver applications. as soon as possible. burdens and costs. This IFC also establishes a framework at Plans and issuers will incur the cost The total cost to plans and issuers the new 31 CFR 33.120(c)(2) and 45 CFR of the qualifying coronavirus preventive related to qualifying coronavirus 155.1320(c)(2) for states to request the services and administration of such preventive services that are Secretaries to modify, in part, the post services. Providing coverage within 15 immunizations will depend on the cost award public notice procedures business days after a recommendation is and number of required immunization outlined in §§ 33.120(c) and 155.1320(c) made relating to such services is likely doses to be administered, the number of for an approved waiver that would to impose significant administrative people who will choose to get otherwise take place or become due costs on issuers, group health plans, and immunized against COVID–19 and during the PHE for COVID–19. As stated other service providers to update which providers will be able to provide above, HHS and the Department of the systems to include billing codes for the the preventive services. For the 2018–19 Treasury are of the view that requiring preventive services, negotiate prices influenza season, 62.6 percent of states that meet the criteria outlined in with network providers, determine children 6 months through 17 years and this IFC to comply with the full public reimbursements for out-of-network 45.3 percent of adults 18 years and older notice procedures during the PHE for providers, and conduct outreach to obtained the influenza vaccine.80 Given providers, participants, beneficiaries, the severity of COVID–19, the COVID–19 could cause undue harm to and enrollees in a very short time Departments anticipate the the public. Allowing the Secretaries to period. Depending on the magnitude of immunization rates for COVID–19 are modify, in part, these requirements will the costs of qualifying coronavirus likely to ultimately be higher than for enable states to request and receive preventive services and administration influenza, although initial rates may be approval for waiver requests more of such services relative to the potential lower until an adequate supply is quickly and also implement changes cost of treatment for the disease, this available. Total costs to plans and that will provide consumers with access may have an impact on premiums. issuers will depend on the cost of to affordable health insurance coverage There are uncertainties regarding the covering qualifying coronavirus during the current PHE for COVID–19. price of potential qualifying coronavirus preventive services, the number of States that request modifications from preventive services, including COVID– people choosing to obtain such services, the public notice procedures will incur 19 immunizations. If the prices are high and whether a third party such as the some burden, as discussed in the and there is widespread use of such Federal Government covers the costs of Collection of Information Requirements services, premiums may increase. If the any immunizations. section. For a state that requests and timing of availability of the preventive The Departments seek comment on receives a modification of the public services is such that plans and issuers any potential costs and burdens that notice procedures, we acknowledge that are unable to take them into account may be incurred by plans and issuers consumers may receive less prior notice when setting premiums, it may result in due to the requirements to cover the than would occur without the lower profits or losses for plans and costs and administration of such modification. Through this IFC, the issuers. The costs to plans and issuers qualifying coronavirus preventive HHS and the Department of Treasury will be lower if a third party, such as the services without any cost sharing intend to provide an appropriate Federal Government, covers the cost of regardless of whether the service is balance and permit flexibility where a the immunizations. In addition, the delivered by an in-network or out-of- state can ensure a sufficient opportunity costs associated with providing network provider. The Departments also for meaningful public input given the coverage for qualifying coronavirus seek comment on the potential effects circumstances in the PHE for COVID–19 preventive services may be offset by and costs consumers may face as a while also ensuring the safety of the savings from avoidance of treatment for result of this provision. public. If a state’s modification request is approved there may be a shorter COVID–19. 7. Effects of Changes to State Innovation During the PHE for COVID–19, costs comment period at the state or Federal Waivers Policy and Regulatory to group health plans or issuers that level, or the comment periods may be Revisions in Response to the COVID–19 have networks of providers will be the same number of days (for example Public Health Emergency higher if a significant number of 30 days) but perhaps on a different participants, beneficiaries, or enrollees This IFC establishes a framework for timeframe. For example, a state may go to out-of-network providers, and the states to request the Secretary of HHS conduct the state public comment issuers and plans reimburse those out- and the Secretary of the Treasury to period concurrently with the Federal of-network providers at higher levels public comment period instead of than their negotiated rate with in- 80 See Flu Vaccination Coverage, United States, before. States with approved 2018–19 Influenza Season. Center for Disease network providers. However, if Control and Prevention, available at https:// modification requests may experience a consumers can obtain the qualifying www.cdc.gov/flu/fluvaxview/coverage- reduction in costs related to post award coronavirus preventive services where 1819estimates.htm. public notice procedures. However, if

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the state’s modification request is to COVID–19 vaccines and preventive services might be available approved, the state must also implement administration cost are dependent on from a narrower range of providers than alternative public notice procedures and the number of required other, more established recommended and, if required, amend the waiver immunization doses to be administered, preventive services because of application to specify that it is the the number of people who will choose specialized storage and administration state’s intent to comply with those to get immunized against COVID–19 requirements. If there are only a limited alternative public notice requirements and which providers and suppliers will number of in-network providers that can in the state’s modification request. be able to provide the preventive administer these services, consumers States may also need to employ services. may incur additional burden related to additional technologies to host virtual 9. Effects of Application Fee as Part of travel and long wait times to obtain hearings instead of in person gatherings. Form CMS–855B Enrollment as Mass these services, which can result in lower In this case, there may be no reduction Immunization Roster Biller utilization. The Departments are in costs related to public notice concerned that allowing plans and procedures. Consistent with § 424.514, an entity issuers to impose cost sharing for HHS and the Department of the enrolling in Medicare as a mass COVID–19 immunizations provided by Treasury seek comment on any potential immunization roster biller via the Form out-of-network providers would costs and burdens that may be incurred CMS–855B must pay an application fee discourage individuals from seeking by states due to the flexibilities afforded at the time of enrollment. The immunization, potentially leading to in this IFC. HHS and the Department of application fees for each of the past 3 reduced administration of any COVID– the Treasury also seek comment on the calendar years were or are $569 (CY 19 vaccine and prolonging the PHE for potential effects and costs consumers 2018), $586, (CY 2019), and $595 (CY COVID–19, contrary to the intent of the may face as a result of a state’s action 2020). The differing fee amounts are CARES Act. In order to ensure that the taken as a result of the flexibilities in predicated on changes/increases in the immunization services will be available this IFC. Consumer Price Index (CPI) for all urban to all consumers enrolled in non- consumers (all items; United State city grandfathered group health plans and 8. Effects of Medicare Coding and average, CPI–U) for the 12-month period Payment for COVID–19 Vaccine non-grandfathered group and individual ending on June 30 of the previous year. health insurance coverage, the This IFC discusses CMS’s Although we cannot predict future Departments are therefore requiring implementation of section 3713 of the changes to the CPI, the fee amounts such plans and issuers to cover without CARES Act (Pub. L. 116–136), which between 2018 and 2020 increased by an cost sharing a qualifying coronavirus established Medicare Part B coverage average of $13 per year. We believe this preventive service, regardless of and payment for a COVID–19 vaccine is a reasonable barometer with which to whether such service is delivered by an and its administration. This IFC requires establish a CY 2021 fee estimate (strictly that Medicare provide coverage for in-network or out-of-network provider. for purposes of this IFC) of $608. The Departments anticipate that as such qualifying COVID–19 vaccines Applying this prospective fee amount services become more widely available administration, without any cost to the previously mentioned 60,000 over time, consumers will be able to sharing. Making COVID–19 vaccines, projected mass immunization roster obtain them more easily from in- available without any delay is in the biller applicants in the first year of this network providers. interest of public health, as making rule, we estimate a total application fee these services available as quickly as cost to enrollees of $36,400,000 (or HHS and the Department of the possible may encourage individuals to 60,000 × $608). This represents a Treasury considered providing states take advantage of these services and transfer from mass immunizer suppliers with the flexibility to waive all of the therefore may slow the transmission of to the Federal Government. public notice procedures outlined in 31 COVID–19. Access to COVID–19 CFR 33.112 and 33.116 and 45 CFR vaccines without cost sharing will D. Regulatory Alternatives Considered 155.1312 and 155.1316 to expedite a encourage more individuals to obtain The Department considered not decision on a proposed section 1332 them. In the immediate term, any newly implementing the changes to the CJR waiver request during the PHE for developed COVID–19 vaccines might be model but determined the effect of the COVID–19. This approach would have available from a narrower range of changes, particularly relief from allowed a state to request to completely providers than other, more established financial risk for COVID–19 cases and eliminate a public notice or reporting recommended preventive items and stability in model operations, to be very requirement pre- or post-award. services. If COVID–19 vaccines require important for participant hospitals However, HHS and the Department of specialized storage and administration during the PHE. Further, if the three- the Treasury were concerned that that services, only a limited number of year extension of the CJR model is this would violate the statutory providers may be able to offer them at finalized, it would be much more requirements regarding a meaningful first. If beneficiaries have to incur difficult for participant hospitals to stop level of input from the public. In additional burdens, long wait times, and model value-based operations, and then addition, HHS and the Department of increased travel times to find Medicare restart value operations when hospitals Treasury are committed to transparency providers and suppliers that can already have significant burden and value public input on waiver provide such services, it will limit managing COVID–19 treatment and proposals and value public feedback to access and discourage them from under COVID–19 safety protocols and ensure consumers are aware of waiver obtaining such services. Medicare utilization changes. proposals that may affect them. HHS providers and suppliers will incur costs The Departments considered not and the Department of the Treasury for providing COVID–19 vaccines and requiring plans and issuers to provide anticipate working with states on their administration of such services. There coverage for qualifying coronavirus modification request to ensure the are uncertainties regarding the cost to preventive services without cost sharing public is provided the opportunity to the Medicare program for COVID–19 from out-of-network providers. provide feedback on waiver proposals vaccines and administration at this However, in the near term, newly and the progress of the program time. The total cost to Medicare related developed qualifying coronavirus authorized by the section 1332 waiver.

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E. Regulatory Flexibility Act In 2020, that threshold is approximately 31 CFR Part 33 $156 million. This IFC was not The Regulatory Flexibility Act, (5 Health care, Health insurance, U.S.C. 601, et seq.), requires agencies to preceded by a general notice of proposed rulemaking, and thus the Reporting and recordkeeping analyze options for regulatory relief of requirements. small entities to prepare an initial requirements of UMRA do not apply. regulatory flexibility analysis to G. Federalism 42 CFR Part 410 describe the impact of the proposed rule Executive Order 13132 establishes Diseases, Health facilities, Health on small entities, unless the head of the certain requirements that an agency professions, Laboratories, Medicare, agency can certify that the rule will not must meet when it promulgates a Reporting and recordkeeping have a significant economic impact on proposed rule (and subsequent final requirements, Rural areas, X-rays. a substantial number of small entities. rule) that imposes substantial direct 42 CFR Part 411 The RFA generally defines a ‘‘small requirement costs on State and local entity’’ as (1) a proprietary firm meeting governments, preempts State law, or Diseases, Medicare, Reporting and the size standards of the Small Business otherwise has Federalism implications. recordkeeping requirements. Administration (SBA), (2) a not-for- Since this rule aims to alleviate burden profit organization that is not dominant on State and local governments, the 42 CFR Part 414 in its field, or (3) a small government requirements of Executive Order 13132 Administrative practice and jurisdiction with a population of less are not applicable. procedure, Biologics, Diseases, Drugs, than 50,000. States and individuals are In compliance with the requirement Health facilities, Health professions, not included in the definition of ‘‘small of Executive Order 13132 that agencies Medicare, Reporting and recordkeeping entity.’’ HHS uses a change in revenues examine closely any policies that may requirements. of more than 3 to 5 percent as its have federalism implications or limit measure of significant economic impact the policy making discretion of the 42 CFR Part 417 on a substantial number of small states, the Departments have engaged in Administrative practice and entities. For purposes of the RFA, small efforts to consult with and work procedure, Grant programs-health, entities include small businesses, cooperatively with affected states, Health care, Health insurance, Health nonprofit organizations, and small including participating in conference maintenance organizations (HMO), Loan governmental jurisdictions. Individuals calls with and attending conferences of programs-health, Medicare, Reporting and states are not included in the the NAIC, and consulting with state and recordkeeping requirements. definition of a small entity. This IFC is insurance officials on an individual not preceded by a general notice of basis. 42 CFR Part 433 proposed rulemaking, and thus the While developing this rule, the requirements of RFA do not apply. Departments attempted to balance the Administrative practice and In addition, section 1102(b)(2) of the states’ interests in regulating health procedure, Child support, Claims, Grant Act provides that whenever the insurance issuers with the need to programs-health, Medicaid, Reporting Secretaries promulgate a final version of ensure market stability. By doing so, the and recordkeeping requirements. a rule or regulation with respect to Departments complied with the 42 CFR Part 510 which an initial regulatory impact requirements of Executive Order 13132. analysis is required, the Secretaries Administrative practice and H. Reducing Regulation and Controlling shall prepare a final regulatory impact procedure, Health facilities, Medicare, Regulatory Costs analysis with respect to the final version Reporting and recordkeeping of such rule or regulation. Such analysis Executive Order 13771, titled requirement. is required to set forth, with respect to Reducing Regulation and Controlling 45 CFR Part 147 small rural hospitals, the matters Regulatory Costs, was issued on January required under section 604 of title 5, 30, 2017 and requires that the costs Age discrimination, Citizenship and United States Code, to be set forth with associated with significant new naturalization, Civil rights, Health care, respect to small entities. The regulations ‘‘shall, to the extent Health insurance, Individuals with Departments are not required to prepare permitted by law, be offset by the disabilities, Intergovernmental relations, a final regulatory impact analysis, elimination of existing costs associated Reporting and recordkeeping because this regulatory action is being with at least two prior regulations.’’ requirements, Sex discrimination. This IFC’s designation under Executive issued as an interim final rule without 45 CFR Part 155 being preceded by a general notice of Order 13771, titled Reducing Regulation proposed rulemaking. and Controlling Regulatory Costs (82 FR Administrative practice and 9339), which was issued on January 30, procedure, Advertising, Brokers, F. Unfunded Mandates 2017, will be informed by public Conflict of interests, Consumer Section 202 of the Unfunded comments received. protection, Grant programs-health, Mandates Reform Act of 1995 (UMRA) List of Subjects Grants administration, Health care, requires that agencies assess anticipated Health insurance, Health maintenance costs and benefits and take certain other 26 CFR Part 54 organizations (HMO), Health records, actions before issuing any proposed rule Excise taxes, Health care, Health Hospitals, Indians, Individuals with or any final rule for which a general insurance, Pensions, Reporting and disabilities, Intergovernmental relations, notice of proposed rulemaking was recordkeeping requirements. Loan programs-health, Medicaid, published that includes any Federal Organization and functions mandate that may result in expenditures 29 CFR Part 2590 (Government agencies), Public in any 1 year by a state, local, or Tribal Employee benefit plans, Health care, assistance programs, Reporting and governments, in the aggregate, or by the Health insurance, Penalties, Pensions, recordkeeping requirements, State private sector, of $100 million in 1995 Privacy, Reporting and recordkeeping flexibility, Technical assistance, Women dollars, updated annually for inflation. requirements. and youth.

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45 CFR Part 182 (ii) Immunizations for routine use in requirements with respect to the office COVID–19 diagnostic testing, children, adolescents, and adults that visit. (ii) If an item or service described in Reporting and recordkeeping have in effect a recommendation from paragraph (a)(1) of this section is not requirements. the Advisory Committee on Immunization Practices of the Centers billed separately (or is not tracked as Dated: , 2020. for Disease Control and Prevention with individual encounter data separately) Seema Verma, respect to the individual involved (for from an office visit and the primary Administrator, Centers for Medicare & purposes of this paragraph (a)(1)(ii), a purpose of the office visit is the delivery Medicaid Services. recommendation from the Advisory of such an item or service, then a plan Dated: , 2020. Committee on Immunization Practices or issuer may not impose cost-sharing Alex M. Azar II, of the Centers for Disease Control and requirements with respect to the office Secretary, Department of Health and Human Prevention is considered in effect after visit. Services. it has been adopted by the Director of (iii) If an item or service described in Sunita Lough, the Centers for Disease Control and paragraph (a)(1) of this section is not billed separately (or is not tracked as Deputy Commissioner for Services and Prevention, and a recommendation is Enforcement, Internal Revenue Service. considered to be for routine use if it is individual encounter data separately) from an office visit and the primary Approved: , 2020. listed on the Immunization Schedules of the Centers for Disease Control and purpose of the office visit is not the David J. Kautter, delivery of such an item or service, then Assistant Secretary of the Treasury (Tax Prevention); (iii) With respect to infants, children, a plan or issuer may impose cost- Policy). sharing requirements with respect to the Signed at Washington DC, this 29th day of and adolescents, evidence-informed preventive care and screenings provided office visit. October, 2020. (iv) The rules of this paragraph (a)(2) Jeanne Klinefelter Wilson, for in comprehensive guidelines supported by the Health Resources and are illustrated by the following Acting Assistant Secretary, Employee Benefits Services Administration; examples: Security Administration, Department of (A) Example 1—(1) Facts. An Labor. (iv) With respect to women, such individual covered by a group health additional preventive care and DEPARTMENT OF THE TREASURY plan visits an in-network health care screenings not described in paragraph provider. While visiting the provider, Internal Revenue Service (a)(1)(i) of this section as provided for in the individual is screened for comprehensive guidelines supported by Amendments to the Regulations cholesterol abnormalities, which has in the Health Resources and Services effect a rating of A or B in the current For the reasons set forth in the Administration for purposes of section recommendations of the United States preamble, the Department of the 2713(a)(4) of the Public Health Service Preventive Services Task Force with Treasury amends 26 CFR part 54 as set Act, subject to 45 CFR 147.131, 147.132, respect to the individual. The provider forth below: and 147.133; and bills the plan for an office visit and for (v) Any qualifying coronavirus PART 54—PENSION EXCISE TAXES the laboratory work of the cholesterol preventive service, which means an screening test. ■ item, service, or immunization that is (2) Conclusion. In paragraph Par. 1. The authority citation for part intended to prevent or mitigate 54 continues to read in part as follows: (a)(2)(iv)(A)(1) of this section, the plan coronavirus disease 2019 (COVID–19) may not impose any cost-sharing Authority: 26 U.S.C. 7805, unless and that is, with respect to the otherwise noted. requirements with respect to the individual involved— separately-billed laboratory work of the * * * * * (A) An evidence-based item or service cholesterol screening test. Because the Section 54.9815–2713T also issued that has in effect a rating of A or B in office visit is billed separately from the under 26 U.S.C. 9833. the current recommendations of the cholesterol screening test, the plan may * * * * * United States Preventive Services Task impose cost-sharing requirements for ■ 2. Section 54.9815–2713T is added to Force; or the office visit. read as follows: (B) An immunization that has in effect (B) Example 2—(1) Facts. Same facts a recommendation from the Advisory as in paragraph (a)(2)(iv)(A)(1) of this § 54.9815–2713T Coverage of preventive Committee on Immunization Practices section (Example 1). As the result of the health services (temporary). of the Centers for Disease Control and screening, the individual is diagnosed (a) Services—(1) In general. Beginning Prevention (regardless of whether the with hyperlipidemia and is prescribed a at the time described in paragraph (b) of immunization is recommended for course of treatment that is not included this section and subject to § 54.9815– routine use). For purposes of this in the recommendations under 2713A, a group health plan, or a health paragraph (a)(1)(v)(B), a paragraph (a)(1) of this section. insurance issuer offering group health recommendation from the Advisory (2) Conclusion. In paragraph insurance coverage, must provide Committee on Immunization Practices (a)(2)(iv)(B)(1) of this section, because coverage for and must not impose any of the Centers for Disease Control and the treatment is not included in the cost-sharing requirements (such as a Prevention is considered in effect after recommendations under paragraph copayment, coinsurance, or a it has been adopted by the Director of (a)(1) of this section, the plan is not deductible) for— the Centers for Disease Control and prohibited from imposing cost-sharing (i) Evidence-based items or services Prevention. requirements with respect to the that have in effect a rating of A or B in (2) Office visits. (i) If an item or treatment. the current recommendations of the service described in paragraph (a)(1) of (C) Example 3—(1) Facts. An United States Preventive Services Task this section is billed separately (or is individual covered by a group health Force with respect to the individual tracked as individual encounter data plan visits an in-network health care involved (except as otherwise provided separately) from an office visit, then a provider to discuss recurring abdominal in paragraph (c) of this section); plan or issuer may impose cost-sharing pain. During the visit, the individual

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has a blood pressure screening, which copayment, coinsurance, or a items and services specified in any has in effect a rating of A or B in the deductible) for any qualifying recommendation or guideline described current recommendations of the United coronavirus preventive service in paragraph (a)(1) of this section on the States Preventive Services Task Force described in paragraph (a)(1)(v) of this first day of a plan year, or as otherwise with respect to the individual. The section, regardless of whether such provided in paragraph (b)(3) of this provider bills the plan for an office visit. service is delivered by an in-network or section, must provide coverage through (2) Conclusion. In paragraph out-of-network provider. For purposes the last day of the plan or policy year, (a)(2)(iv)(C)(1) of this section, the blood of this paragraph (a)(3)(iii), with respect even if the recommendation or pressure screening is provided as part of to a qualifying coronavirus preventive guideline changes or is no longer an office visit for which the primary service and a provider with whom the described in paragraph (a)(1) of this purpose was not to deliver items or plan or issuer does not have a section, during the applicable plan or services described in paragraph (a)(1) of negotiated rate for such service (such as policy year. this section. Therefore, the plan may an out-of-network provider), the plan or (ii) Notwithstanding paragraph impose a cost-sharing requirement for issuer must reimburse the provider for (b)(2)(i) of this section, to the extent a the office visit charge. such service in an amount that is recommendation or guideline described (D) Example 4—(1) Facts. A child reasonable, as determined in in paragraph (a)(1)(i) of this section that covered by a group health plan visits an comparison to prevailing market rates was in effect on the first day of a plan in-network pediatrician to receive an for such service. year, or as otherwise provided in annual physical exam described as part (4) Reasonable medical management. paragraph (b)(3) of this section, is of the comprehensive guidelines Nothing prevents a plan or issuer from downgraded to a ‘‘D’’ rating, or any item supported by the Health Resources and using reasonable medical management or service associated with any Services Administration. During the techniques to determine the frequency, recommendation or guideline specified office visit, the child receives additional method, treatment, or setting for an item in paragraph (a)(1) of this section is items and services that are not described or service described in paragraph (a)(1) subject to a safety recall or is otherwise in the comprehensive guidelines of this section to the extent not specified determined to pose a significant safety supported by the Health Resources and in the relevant recommendation or concern by a Federal agency authorized Services Administration, nor otherwise guideline. To the extent not specified in to regulate the item or service during a described in paragraph (a)(1) of this a recommendation or guideline, a plan plan or policy year, there is no section. The provider bills the plan for or issuer may rely on the relevant requirement under this section to cover an office visit. clinical evidence base and established these items and services through the last (2) Conclusion. In paragraph reasonable medical management day of the applicable plan or policy (a)(2)(iv)(D)(1) of this section, the techniques to determine the frequency, year. service was not billed as a separate method, treatment, or setting for (3) Rapid coverage of preventive charge and was billed as part of an coverage of a recommended preventive services for coronavirus. In the case of office visit. Moreover, the primary health service. a qualifying coronavirus preventive purpose for the visit was to deliver (5) Services not described. Nothing in service described in paragraph (a)(1)(v) items and services described as part of this section prohibits a plan or issuer of this section, a plan or issuer must the comprehensive guidelines from providing coverage for items and provide coverage for such item, service, supported by the Health Resources and services in addition to those or immunization in accordance with Services Administration. Therefore, the recommended by the United States this section by the date that is 15 plan may not impose a cost-sharing Preventive Services Task Force or the business days after the date on which a requirement with respect to the office Advisory Committee on Immunization recommendation specified in paragraph visit. Practices of the Centers for Disease (a)(1)(v)(A) or (B) of this section is made (3) Out-of-network providers. (i) Control and Prevention, or provided for relating to such item, service, or Subject to paragraphs (a)(3)(ii) and (iii) by guidelines supported by the Health immunization. of this section, nothing in this section Resources and Services Administration, (c) Recommendations not current. For requires a plan or issuer that has a or from denying coverage for items and purposes of paragraph (a)(1)(i) of this network of providers to provide benefits services that are not recommended by section, and for purposes of any other for items or services described in that task force or that advisory provision of law, recommendations of paragraph (a)(1) of this section that are committee, or under those guidelines. A the United States Preventive Services delivered by an out-of-network plan or issuer may impose cost-sharing Task Force regarding breast cancer provider, or precludes a plan or issuer requirements for a treatment not screening, mammography, and that has a network of providers from described in paragraph (a)(1) of this prevention issued in or around imposing cost-sharing requirements for section, even if the treatment results November 2009 are not considered to be items or services described in paragraph from an item or service described in current. (a)(1) of this section that are delivered paragraph (a)(1) of this section. (d) Applicability date. The provisions by an out-of-network provider. (b) Timing—(1) In general. A plan or of paragraphs (a)(1)(i) through (iv), (ii) If a plan or issuer does not have issuer must provide coverage pursuant (a)(2), (a)(3)(i) and (ii), (a)(4) through (5), in its network a provider who can to paragraph (a)(1) of this section for (b)(1) and (2), and (c) of this section are provide an item or service described in plan years that begin on or after applicable as of , 2012. paragraph (a)(1) of this section, the plan September 23, 2010, or, if later, for plan (e) Sunset date. The provisions of or issuer must cover the item or service years that begin on or after the date that paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3) when performed by an out-of-network is one year after the date the of this section will not apply with provider, and may not impose cost- recommendation or guideline is issued, respect to a qualifying coronavirus sharing with respect to the item or except as provided in paragraph (b)(3) of preventive service furnished on or after service. this section. the expiration of the public health (iii) A plan or issuer must provide (2) Changes in recommendations or emergency determined on January 31, coverage for and must not impose any guidelines. (i) A plan or issuer that is 2020, to exist nationwide as of January cost-sharing requirements (such as a required to provide coverage for any 27, 2020, by the Secretary of Health and

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Human Services pursuant to section 319 immunization is recommended for even if the recommendation or of the Public Health Service Act, as a routine use). For purposes of this guideline changes or is no longer result of COVID–19, including any paragraph (a)(1)(v)(B), a described in paragraph (a)(1) of this subsequent renewals of that recommendation from the Advisory section, during the applicable plan or determination. Committee on Immunization Practices policy year. of the Centers for Disease Control and DEPARTMENT OF LABOR (ii) Notwithstanding paragraph Prevention is considered in effect after (b)(2)(i) of this section, to the extent a Employee Benefits Security it has been adopted by the Director of recommendation or guideline described Administration the Centers for Disease Control and in paragraph (a)(1)(i) of this section that For the reasons set forth in the Prevention. was in effect on the first day of a plan preamble, the Department of Labor * * * * * year, or as otherwise provided in amends 29 CFR part 2590 as set forth (3) * * * paragraph (b)(3) of this section, is below: (i) Subject to paragraphs (a)(3)(ii) and downgraded to a ‘‘D’’ rating, or any item (iii) of this section, nothing in this or service associated with any PART 2590—RULES AND section requires a plan or issuer that has recommendation or guideline specified REGULATIONS FOR GROUP HEALTH a network of providers to provide in paragraph (a)(1) of this section is PLANS benefits for items or services described subject to a safety recall or is otherwise in paragraph (a)(1) of this section that determined to pose a significant safety ■ 3. The authority citation for part 2590 are delivered by an out-of-network concern by a Federal agency authorized continues to read as follows: provider, or precludes a plan or issuer to regulate the item or service during a Authority: 29 U.S.C. 1027, 1059, 1135, that has a network of providers from plan or policy year, there is no 1161–1168, 1169, 1181–1183, 1181 note, imposing cost-sharing requirements for requirement under this section to cover 1185, 1185a, 1185b, 1191, 1191a, 1191b, and items or services described in paragraph these items and services through the last 1191c; sec. 101(g), Pub. L. 104–191, 110 Stat. (a)(1) of this section that are delivered day of the applicable plan or policy 1936; sec. 401(b), Pub. L. 105–200, 112 Stat. by an out-of-network provider. year. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 110–343, 122 Stat. 3881; sec. 1001, 1201, and * * * * * (3) Rapid coverage of preventive 1562(e), Pub. L. 111–148, 124 Stat. 119, as (iii) A plan or issuer must provide services for coronavirus. In the case of amended by Pub. L. 111–152, 124 Stat. 1029; coverage for and must not impose any a qualifying coronavirus preventive Division M, Pub. L. 113–235, 128 Stat. 2130; cost-sharing requirements (such as a service described in paragraph (a)(1)(v) Secretary of Labor’s Order 1–2011, 77 FR copayment, coinsurance, or a of this section, a plan or issuer must 1088 (Jan. 9, 2012). deductible) for any qualifying provide coverage for such item, service, ■ 4. Section 2590.715–2713 is coronavirus preventive service or immunization in accordance with amended— described in paragraph (a)(1)(v) of this this section by the date that is 15 ■ a. In paragraph (a)(1)(iii) by removing section, regardless of whether such business days after the date on which a ‘‘and’’ after the semicolon; service is delivered by an in-network or recommendation specified in paragraph ■ b. In paragraph (a)(1)(iv) by removing out-of-network provider. For purposes (a)(1)(v)(A) or (B) of this section is made the period at the end of the paragraph of this paragraph (a)(3)(iii), with respect relating to such item, service, or and adding ‘‘; and’’ in its place; to a qualifying coronavirus preventive immunization. ■ c. By adding paragraph (a)(1)(v); service and a provider with whom the * * * * * ■ d. By revising paragraph (a)(3)(i); plan or issuer does not have a (e) Sunset date. The provisions of ■ e. By adding paragraph (a)(3)(iii); negotiated rate for such service (such as paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3) ■ f. By revising paragraphs (b)(1) and an out-of-network provider), the plan or of this section will not apply with (b)(2)(i) and (ii); and issuer must reimburse the provider for respect to a qualifying coronavirus ■ g. By adding paragraphs (b)(3) and (e). such service in an amount that is preventive service furnished on or after The revisions and additions read as reasonable, as determined in the expiration of the public health follows: comparison to prevailing market rates emergency determined on January 31, for such service. 2020, to exist nationwide as of January § 2590.715–2713 Coverage of preventive * * * * * health services. 27, 2020, by the Secretary of Health and (b) * * * Human Services pursuant to section 319 (a) * * * (1) In general. A plan or issuer must of the Public Health Service Act, as a (1) * * * provide coverage pursuant to paragraph result of COVID–19, including any (v) Any qualifying coronavirus (a)(1) of this section for plan years that subsequent renewals of that preventive service, which means an begin on or after September 23, 2010, or, determination. item, service, or immunization that is if later, for plan years that begin on or intended to prevent or mitigate after the date that is one year after the DEPARTMENT OF THE TREASURY coronavirus disease 2019 (COVID–19) date the recommendation or guideline is Office of the Secretary and that is, with respect to the issued, except as provided in paragraph individual involved— (b)(3) of this section. Amendments to the Regulations (A) An evidence-based item or service (2) * * * For the reasons set forth in the that has in effect a rating of A or B in (i) A plan or issuer that is required to preamble, the Department of Treasury the current recommendations of the provide coverage for any items and amends 31 CFR part 33 as set forth United States Preventive Services Task services specified in any below: Force; or recommendation or guideline described (B) An immunization that has in effect in paragraph (a)(1) of this section on the PART 33—WAIVERS FOR STATE a recommendation from the Advisory first day of a plan year, or as otherwise INNOVATION Committee on Immunization Practices provided in paragraph (b)(3) of this of the Centers for Disease Control and section, must provide coverage through ■ 5. The authority citation for part 33 Prevention (regardless of whether the the last day of the plan or policy year, continues to read as follows:

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Authority: Sec. 1332, Pub. L. 111–148, 124 alternative public notice procedures it prior to the public health emergency for Stat. 119. requests to be implemented at the COVID–19. ■ 6. Section 33.118 is added to read as Federal level. (ii) A State must meet all of the follows: (c) The Secretary and the Secretary of following criteria to request a Health and Human Services will modification under paragraph (c) of this § 33.118 Modification from the normal evaluate a State’s request for a section: public notice requirements during the (A) The State must request a public health emergency. modification under paragraph (a) of this section and issue their exemption modification under this paragraph (a) The Secretary and the Secretary of determination within approximately 15 (c)(2), in the form and manner specified Health and Human Services may calendar days after the request is by the Secretaries. modify, in part, the State public notice received. (B) The State must have acted in good requirements under § 33.112 and the faith, and in a diligent, timely, and Federal public notice procedures under (d) The Secretary of Health and Human Services will publish on the prudent manner to comply with the § 33.116 to expedite a decision on a monitoring and compliance requirement proposed waiver request during the Centers for Medicare and Medicaid Services (CMS) website any under the waiver and the terms and public health emergency for COVID–19, conditions of the agreement between the as defined in 42 CFR 400.200, when a modification determinations within 15 calendar days of the Secretary and the Secretary and the Secretary of Health delay would undermine or compromise and Human Services, as applicable, and the purpose of the proposed waiver Secretary of Health and Human Services making such a determination, as well as the State to implement a section 1332 request and be contrary to the interests waiver and to submit and prepare the of consumers. These flexibilities are the approved revised timeline for public comment under the approved request for a modification under this limited to event-triggered, emergent paragraph (c)(2). alternative State or Federal public situations, and the flexibilities outlined (C) The State must detail in its request notice procedures, as applicable. in this section will not be available for for a modification under this paragraph States seeking to address a threat to (e) The State must publish on its (c)(2) the alternative post award public consumers’ access to health coverage or website any modification requests and notice procedures it proposes to care that existed prior to the public determinations within 15 calendar days implement at the State level, including health emergency for COVID–19. of receipt of the determination, as well public hearings, that are designed to (b) A State must meet all of the as the approved revised timeline for provide the greatest opportunity and following criteria to request a public comment under the alternative level of meaningful public input from modification under paragraph (a) of this State or Federal public notice impacted stakeholders that is section: procedures, as applicable. practicable given the emergency (1) The State must request a (f) The State must, as applicable, circumstances underlying the State’s modification under paragraph (a) of this implement the alternative public notice request for a modification. section, in the form and manner procedures at the State level if the (D) The Secretary and the Secretary of specified by the Secretaries. State’s exemption request is approved Health and Human Services will (2) The State must have acted in good and, if required, amend the waiver evaluate a State’s request for a faith, and in a diligent, timely, and application request. modification under this paragraph (c)(2) prudent manner in the preparation of ■ 7. Section 33.120 is amended— and issue their modification the request for a modification under ■ a. In paragraph (c)(1) by adding a determination within approximately 15 paragraph (a) of this section, and the paragraph heading; and calendar days after the request is waiver application request, as ■ b. By adding paragraph (c)(2). received. applicable. The additions read as follows: (E) The State must publish on its (3) The State must, as applicable, website any modification requests and detail in its request for a modification § 33.120 Monitoring and compliance. determinations within 15 calendar days from State-level notice procedures * * * * * of the receipt of the determination as under paragraph (a) of this section the (c) * * * well as information on the approved justification for the request and the (1) Notification requirements for revised timeline for the state’s post alternative public notice procedures it public forum. *** award public notice procedures, as proposes to implement at the State (2) Modification from the normal applicable. level, including public hearings, that are post-award requirements during the * * * * * designed to provide the greatest public health emergency. (i) The opportunity and level of meaningful Secretary and the Secretary of Health DEPARTMENT OF HEALTH AND public input from impacted and Human Services may modify, in HUMAN SERVICES stakeholders that is practicable given part, State post-award requirements Centers for Medicare & Medicaid the emergency circumstances under this paragraph (c)(2) for an Services underlying the State’s request for a approved waiver request during the For the reasons stated in the modification. As a condition of public health emergency for COVID–19, preamble, the Centers for Medicare & receiving a modification approval, a as defined in 42 CFR 400.200, when the Medicaid Services amends 42 CFR State must implement public notice application of the post award public chapter IV as set forth below: procedures, including public hearings, notice requirements would be contrary at the State level and, if required, amend to the interests of consumers during the PART 410—SUPPLEMENTARY the waiver application request. public health emergency. These MEDICAL INSURANCE (SMI) (4) The State must, as applicable, flexibilities are limited to event- BENEFITS detail in its request for a modification triggered, emergent situations, and the from Federal-level notice procedures flexibilities outlined in this section will ■ 8. The authority citation part 414 under paragraph (a) of this section the not be available for States seeking to continues to read as follows: justification for the request as it relates address a threat to consumers’ access to Authority: 42 U.S.C. 1302, 1395m, to the public health emergency and the health coverage or care that existed 1395hh, 1395rr, and 1395ddd.

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■ 9. Section 410.57 is amended by § 414.701 Purpose. PART 417—HEALTH MAINTENANCE adding paragraph (c) to read as follows: This subpart implements section ORGANIZATIONS, COMPETITIVE MEDICAL PLANS, AND HEALTH CARE § 410.57 Pneumococcal vaccine, flu 1842(o) of the Act by specifying the vaccine, and COVID–19 vaccine. methodology for determining the PREPAYMENT PLANS payment allowance limit for drugs and * * * * * ■ biologicals covered under Part B of Title 19. The authority citation for part 417 (c) Medicare Part B pays for the is revised to read as follows: COVID–19 vaccine and its XVIII of the Act (hereafter in this Authority: 42 U.S.C. 1302 and 1395hh, administration. subpart referred to as the ‘‘program’’) that are not paid on a cost or and 300e, 300e–5, and 300e–9, and 31 U.S.C. ■ 10. Section 410.152 is amended by prospective payment system basis. 9701. revising paragraph (l)(1) to read as Examples of drugs that are subject to the ■ 20. Section 417.454 is amended by follows: rules contained in this subpart are: adding paragraph (e)(4) to read as § 410.152 Amounts of payment. Drugs furnished incident to a follows: * * * * * physician’s service; durable medical § 417.454 Charges to Medicare enrollees. equipment (DME) drugs; separately (l) * * * * * * * * (1) Pneumococcal (as specified in billable drugs at independent dialysis facilities not under the ESRD composite (e) * * * paragraph (h) of this section), influenza, (4) A COVID–19 vaccine and its hepatitis B, and COVID–19 vaccine and rate; statutorily covered drugs, for example, influenza, pneumococcal, administration described in section administration. 1861(s)(10)(A) for the duration of the * * * * * hepatitis, and COVID–19 vaccines, antigens, hemophilia blood clotting emergency period defined in paragraph ■ 11. Section 410.160 is amended by factor, immunosuppressive drugs and (1)(B) of section 1135(g) of the Act. revising paragraph (b)(2) to read as certain oral anti-cancer drugs. follows: PART 433—STATE FISCAL ■ 16. Section 414.707 is amended by ADMINISTRATION § 410.160 Part B annual deductible. revising paragraph (a)(2)(iii) to read as * * * * * follows: ■ 21. The authority citation for part 433 (b) * * * continues to read as follows: § 414.707 Basis of payment. (2) Pneumococcal, influenza, and Authority: Sec. 1102 of the Social Security hepatitis b, and COVID–19 vaccines and (a) * * * Act, (42 U.S.C. 1302). their administration. (2) * * * ■ 22. Subpart G, consisting of § 433.400, * * * * * (iii) Pneumococcal, influenza, and is added to read as follows: PART 411—EXCLUSIONS FROM COVID–19 vaccines as well as hepatitis Subpart G—Temporary FMAP Increase MEDICARE AND LIMITATIONS ON B vaccine that is furnished to During the Public Health Emergency MEDICARE PAYMENT individuals at high or intermediate risk for COVID–19 of contracting hepatitis B (as determined ■ 12. The authority citation part 411 by the Secretary). § 433.400 Continued Enrollment for continues to read as follows: * * * * * Temporary FMAP Increase. (a) Statutory basis. This subpart Authority: 42 U.S.C. 1302, 1395w-101 ■ 17. Section 414.900 is amended by interprets and implements section through 1395w–152, 1395hh, and 1395nn. revising paragraph (b)(3)(ii) to read as 6008(b)(3) of the Families First ■ 13. Section 411.15 is amended by: follows: ■ a. Removing ‘‘and’’ at the end of Coronavirus Response Act (FFCRA) and paragraph (e)(3); § 414.900 Basis and scope. section 1902(a)(4) and (a)(19) of the ■ b. Removing the period at the end of * * * * * Social Security Act. (b) Definitions. For purposes of this paragraph (e)(4) and adding ‘‘; and’’ in (b) * * * its place; and subpart— ■ c. Adding paragraph (e)(5). (3) * * * COVID–19 means Coronavirus Disease The addition reads as follows: (ii) Pneumococcal, Hepatitis B, and 2019. COVID–19 vaccines. Medicare Savings Program means the § 411.15 Particular services excluded from * * * * * coverage of Medicare premiums and coverage. cost sharing furnished to individuals ■ * * * * * 18. Section 414.904 is amended by described in, and determined by the (e) * * * revising paragraph (e)(1) to read as state to be eligible under, section (5) COVID–19 vaccinations that are follows: 1902(a)(10)(E)(i), 1902(a)(10)(E)(iii), or reasonable and necessary for the § 414.904 Average sales price as the basis 1902(a)(10)(E)(iv) of the Act. prevention of illness. for payment. Minimum essential coverage (MEC) * * * * * * * * * * has the meaning provided under section 5000A(f)(1) of the Internal Revenue PART 414—PAYMENT FOR PART B (e) * * * Code and implementing regulations at MEDICAL AND OTHER HEALTH (1) Vaccines. The payment limits for 26 CFR 1.5000A–2 and includes SERVICES hepatitis B vaccine furnished to minimum essential coverage determined individuals at high or intermediate risk by the Secretary under 26 CFR 1.5000A– ■ 14. The authority citation part 414 of contracting hepatitis B (as determined 2(f). continues to read as follows: by the Secretary), pneumococcal Public Health Emergency for COVID– Authority: 42 U.S.C. 1302, 1395hh, and vaccine, influenza vaccine, and COVID– 19 has the same definition provided in 1395rr(b)(l). 19 vaccine are calculated using 95 § 400.200 of this chapter. ■ 15. Section 414.701 is revised to read percent of the average wholesale price. Temporary FMAP increase means the as follows: * * * * * 6.2 percentage point increase in the

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State’s Federal medical assistance (B) For beneficiaries described in Act to provide full benefits to lawfully percentage (FMAP) that is authorized paragraph (c)(2)(i)(A) whom the state residing children or pregnant women under section 6008(a) of the FFCRA subsequently determines are eligible for must limit coverage for such through the end of the fiscal quarter in coverage under a Medicare Savings beneficiaries if they no longer meet the which the Public Health Emergency for Program eligibility group, the state definition of a lawfully residing child or COVID–19 ends. satisfies the requirement described in pregnant woman under such section to Validly enrolled means that the paragraph (c)(2) of this section if it services necessary for treatment of an beneficiary was enrolled in Medicaid furnishes the medical assistance emergency medical condition, as based on a determination of eligibility. available through the Medicare Savings defined in section 1903(v)(3) of the Act. A beneficiary is not validly enrolled if Program. (3)(i) For purposes of paragraph the agency determines the eligibility (ii) For beneficiaries whose Medicaid (d)(1)(i) of this section, a beneficiary was erroneously granted at the most coverage as of or after March 18, 2020 may request a voluntary termination of recent determination, redetermination, does not meet the definition of MEC in eligibility from the Medicaid coverage or renewal of eligibility (if such last paragraph (b) of this section but does in which the beneficiary is enrolled to redetermination or renewal was include coverage for testing services and transition to other Medicaid coverage completed prior to March 18, 2020) treatments for COVID–19, including for which the beneficiary is eligible, because of agency error or fraud (as vaccines, specialized equipment, and even if the transition to the new evidenced by a fraud conviction) or therapies, the state must continue to Medicaid coverage would not be abuse (as determined following the provide Medicaid coverage that consistent with paragraph (c)(2) of this completion of an investigation pursuant includes such testing services and section. to §§ 455.15 and 455.16 of this chapter) treatments. (ii) For purposes of paragraph attributed to the beneficiary or the (iii) For beneficiaries not described in (d)(1)(ii) of this section, beneficiaries beneficiary’s representative, which was paragraph (c)(2)(i) or (ii) of this section, who were identified through a data material to the determination of the state must continue to provide at match with the Public Assistance eligibility. Individuals receiving least the same level of medical Reporting Information System in medical assistance during a assistance as was provided as of or after accordance with § 435.945(d) of this presumptive eligibility period in March 18, 2020. chapter indicating simultaneous accordance with part 435, subpart L, of (iv) If a state determines that a validly enrollment in two or more states, and this chapter have not received a enrolled beneficiary is no longer eligible who fail to respond to a request for determination of eligibility by the state for Medicaid, including on a procedural information to verify their residency, under the state plan and are not basis, the state meets the requirements may be treated as not being a state considered validly enrolled described in paragraph (c)(2)(i), (ii), or resident for purposes of paragraph beneficiaries for purposes of this (iii) of this section by continuing to (d)(1)(ii) of this section, provided that section. provide the same Medicaid coverage the state takes all reasonably available (c) General requirements. (1) In order that the beneficiary would have measures to attempt to verify the to claim the temporary FMAP increase received absent the determination of beneficiary’s state residency. If a for: ineligibility. beneficiary’s enrollment is terminated (3) Otherwise permissible changes to (i) The quarter in which November 2, under the exception at paragraph beneficiary coverage, cost sharing, and 2020, falls, a state must meet the (d)(1)(ii) of this section based on a post-eligibility treatment of income, requirements described in paragraph PARIS data match and the state including both changes affecting an (c)(2) of this section from November 2, subsequently obtains information individual beneficiary and approved 2020, through the end of the quarter. verifying residency, the state must changes to the state plan, a section 1115 (ii) Any quarter beginning after reinstate the beneficiary’s Medicaid demonstration and/or a waiver November 2, 2020, through the quarter enrollment retroactive to the date of authorized under section 1915 of the in which the public health emergency termination. Act impacting multiple beneficiaries, for COVID–19, including any will not impact a state’s ability to claim PART 510—COMPREHENSIVE CARE extensions, ends, a state must meet the the temporary FMAP increase provided FOR JOINT REPLACEMENT MODEL requirements described in paragraphs that any such changes do not violate the (c)(2) of this section. ■ requirement to maintain beneficiary 23. The authority citation for part 510 (2) Except as provided in paragraph enrollment described at paragraph (c)(2) is revised to read as follows: (d) of this section, for all beneficiaries of this section or the requirement in Authority: 42 U.S.C. 1302, 1315(a), and validly enrolled for benefits under the section 6008(b)(4) of the FFCRA. 1395hh. state plan, a waiver of such plan, or a (d) Exceptions. (1) Consistent with the ■ 24. Section 510.2 is amended by— demonstration project under section condition to claim the temporary FMAP ■ a. Adding a definition for ‘‘COVID–19 1115(a) of the Act as of or after March increase described in paragraph (c)(2) of Diagnosis Code’’ in alphabetical order; 18, 2020, the state must maintain the this section, a state may terminate a and beneficiary’s enrollment as follows, beneficiary’s Medicaid enrollment prior ■ b. Revising the definitions for ‘‘Lower- through the end of the month in which to the first day of the month after the extremity joint replacement (LEJR)’’, the public health emergency for COVID– public health emergency for COVID–19 ‘‘Performance year’’, and ‘‘Quality 19 ends: ends in the following circumstances: improvement points’’. (i)(A) For beneficiaries whose (i) The beneficiary or the beneficiary’s The addition and revisions read as Medicaid coverage meets the definition representative requests a voluntary follows: of MEC in paragraph (b) of this section termination of eligibility; as of or after March 18, 2020, the state (ii) The beneficiary ceases to be a § 510.2 Definitions. must continue to provide Medicaid resident of the state; or * * * * * coverage that meets the definition of (iii) The beneficiary dies. COVID–19 Diagnosis Code means any MEC, except as provided in paragraph (2) States which have elected the of the following ICD–10–CM diagnosis (c)(2)(i)(B) of this section. option under section 1903(v)(4) of the codes:

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(1) B97.29; and 5.2, payments for otherwise repayment amounts under (2) U07.1; or included items and services in excess of § 510.305(f)(2) and (3) and from LEJR (3) Any other ICD–10–CM diagnosis 2 standard deviations above the mean episodes included in the BPCI initiative code that is recommended by the regional episode payment in accordance are included in historical episode Centers for Disease Control and with § 510.300(b)(5). payments. Prevention for the coding of a confirmed * * * * * (c) * * * case of COVID–19. (1) Discount factors affected by the ■ 26. Section 510.300 is amended by * * * * * quality incentive payments and the revising paragraphs (a) introductory composite quality score. In all Lower-extremity joint replacement text, (a)(1)(i), (a)(1)(iii), (a)(2) and (3), (LEJR) means any procedure that is performance years and performance (b)(1)(iii), (b)(2)(iii), (b)(8), (c)(1) and (2), year subsets, the discount factor may be within MS–DRG 469 or 470, or, on or and (c)(3)(iii) to read as follows: after October 1, 2020, MS–DRG 521 or affected by the quality incentive 522, including lower-extremity joint § 510.300 Determination of episode payment and composite quality score as replacement procedures or reattachment quality-adjusted target prices. provided in § 510.315 to create the of a lower extremity. (a) General. CMS establishes episode effective discount factor or applicable * * * * * quality-adjusted target prices for discount factor used for calculating Performance year means one of the participant hospitals for each reconciliation payments and repayment years in which the CJR model is being performance year or performance year amounts. The quality-adjusted target tested. Performance years for the model subset of the model as specified in this prices incorporate the effective or correlate to calendar years with the section. Episode quality-adjusted target applicable discount factor at exceptions of performance year 1, which prices are established according to the reconciliation. (2) Discount factor for reconciliation is April 1, 2016 through December 31, following: payments. The discount factor for 2016 and performance year 5, which is (1) * * * reconciliation payments in all January 1, 2020 through September 30, (i)(A) MS–DRG 469 with hip fracture; performance years and performance 2021. For reconciliation purposes, or year subsets is 3.0 percent. performance year 5 is divided into two (B) For episodes beginning on or after October 1, 2020, MS–DRG 521; (3) * * * subsets, performance year subset 5.1 (iii) In performance year 4 and each (January 1, 2020 through December 31, * * * * * of performance year subsets 5.1 and 5.2, 2020) and performance year subset 5.2 (iii)(A) MS–DRG 470 with hip 3.0 percent. (January 1, 2021 through September 30, fracture; or * * * * * 2021). (B) For episodes beginning on or after October 1, 2020, MS–DRG 522; or ■ 27. Section 510.305 is amended by * * * * * revising paragraphs (b), (d)(1) * * * * * Quality improvement points are introductory text, (e) introductory text, (2) Applicable time period for points that CMS adds to a participant (e)(1) introductory text, (e)(1)(i), (ii), and performance year or performance year hospital’s composite quality score for a (iii), (e)(1)(v)(A) introductory text, subset episode quality-adjusted target measure if the hospital’s performance (e)(1)(v)(A)(3), (e)(1)(v)(B) introductory prices. Episode quality-adjusted target percentile on an individual quality text, (e)(1)(v)(B)(3), (e)(1)(v)(C), (f)(1)(ii), prices are updated to account for measure for performance years 2 (g)(1) and (3), (h) introductory text, Medicare payment updates no less than through 4 and for performance year (h)(5) and (6), (i), (j), and (k)(4) to read 2 times per year, for updated quality- subsets 5.1 and 5.2, increases from the as follows: previous performance year or adjusted target prices effective October performance year subset by at least 2 1 and January 1, and at other intervals § 510.305 Determination of the NPRA and deciles on the performance percentile if necessary. reconciliation process. scale, as described in § 510.315(d). For (3) Episodes that straddle * * * * * performance year 1, CMS adds quality performance years or performance year (b) Reconciliation. CMS uses a series improvement points to a participant subsets or payment updates. The of reconciliation processes, which CMS hospital’s composite quality score for a quality-adjusted target price that applies performs as described in paragraphs (d) measure if the hospital’s performance to the type of episode as of the date of and (f) of this section, after the end of percentile on an individual quality admission for the anchor hospitalization each performance year 1 through 4 to measure increases from the is the quality-adjusted target price that establish final payment amounts to corresponding time period in the applies to the episode. participant hospitals for CJR episodes previous year by at least 2 deciles on the * * * * * for a given performance year. Following performance percentile scale, as (b) * * * the end of each performance year 1 described in § 510.315(d). (1) * * * through 4, CMS determines actual * * * * * (iii) Episodes beginning in 2016 episode payments for each episode for ■ 25. Section 510.200 is amended by through 2018 for each of performance the performance year (other than revising paragraphs (a) and (d)(6) to read year subsets 5.1 and 5.2. episodes that have been canceled in as follows: (2) * * * accordance with § 510.210(b)), and (iii) Regional historical episode determines the amount of a § 510.200 Time periods, included and payments for performance year 4 and reconciliation payment or repayment excluded services, and attribution. each of performance year subsets 5.1 amount. Within performance year 5, (a) Time periods. All episodes must and 5.2. CMS separately performs the begin on or after April 1, 2016 and end * * * * * reconciliation processes described in on or before September 30, 2021. (8) Inclusion of reconciliation paragraphs (d) and (f) of this section for * * * * * payments and repayments. For performance year subsets 5.1 and 5.2 (d) * * * performance years 3, 4, and each of and following the end of each (6) For performance years 1 through 4 performance year subsets 5.1 and 5.2 performance year subset 5.1 and 5.2, and for performance year subsets 5.1 only, reconciliation payments and CMS separately determines the actual

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episode payment for each episode for (iii) Aggregates the amounts determine the reconciliation payment or the subset of the performance year computed in paragraph (e)(1)(ii) of this repayment amount. (other than episodes that have been section for all episodes included in the * * * * * canceled in accordance with performance year or performance year (g) * * * § 510.210(b)) and determines the subset (other than episodes that have (1) CMS assesses each participant amount of a reconciliation payment or been canceled in accordance with hospital’s performance on quality repayment for each of performance year § 510.210(b)). metrics, as described in § 510.315, to subsets 5.1 and 5.2. * * * * * determine whether the participant * * * * * (v) * * * hospital is eligible to receive a reconciliation payment for a (d) * * * (A) Limitation on loss. Except as performance year or performance year (1) Beginning 2 months after the end provided in paragraph (e)(1)(v)(C) of this subset. of each of performance years 1 through section, the total amount of the NPRA 4 and performance year subset 5.1 and and subsequent reconciliation * * * * * 5 months after the end of performance calculation for a performance year or (3) If the hospital’s composite quality year subset 5.2, CMS does all of the performance year subset cannot exceed score described in § 510.315 is below following: the following: acceptable, defined as less than 4.00 for a performance year or performance year * * * * * * * * * * subset, the hospital is not eligible for a (e) Calculation of the NPRA. By (3) For performance year 4 and each reconciliation payment. comparing the quality-adjusted target of performance year subsets 5.1 and 5.2, * * * * * prices described in § 510.300 and the 20 percent of the amount calculated in (h) Reconciliation report. CMS issues participant hospital’s actual episode paragraph (e)(1)(iii) of this section for each participant hospital a CJR spending for each of performance years the performance year or performance reconciliation report for the 1 through 4 and each of performance year subset. performance year or performance year year subsets 5.1 and 5.2 and applying * * * * * subset. Each CJR reconciliation report the adjustments in paragraph (e)(1)(v) of (B) Limitation on gain. The total contains the following: this section, CMS establishes an NPRA amount of the NPRA and subsequent * * * * * for each participant hospital for each reconciliation calculation for a (5) As applicable, the NPRA and such performance year or performance performance year or performance year subsequent reconciliation calculation year subset. subset cannot exceed the following: amount for the previous performance (1) Initial calculation. In calculating * * * * * year or performance year subset. the NPRA for each participant hospital (3) For performance year 4 and each (6) As applicable, the post-episode for each of performance years 1 through of performance year subsets 5.1 and 5.2, spending amount and ACO overlap 4 and each of performance year subsets 20 percent of the amount calculated in calculation for the previous 5.1 and 5.2, CMS does the following: paragraph (e)(1)(iii) of this section for performance year or performance year (i) Determines actual episode the performance year or performance subset. payments for each episode included in year subset. * * * * * the performance year or performance * * * * * (i) Subsequent reconciliation year subset (other than episodes that calculation. (1) Fourteen months after (C) Financial loss limits for rural have been canceled in accordance with the end of each of performance years 1 hospitals, SCHs, MDHs, and RRCs. If a § 510.210(b)) using claims data that is through 4 and performance year subset participant hospital is a rural hospital, available 2 months after the end of the 5.1 and seventeen months after the end SCH, MDH, or RRC, then for performance year or performance year of performance year subset 5.2, CMS performance year 2, the total repayment subset. Actual episode payments are performs an additional calculation, amount for which the participant capped, as applicable, at the amount using claims data available at that time, hospital is responsible due to the NPRA determined in accordance with to account for final claims run-out and and subsequent reconciliation § 510.300(b)(5) for the performance year any additional episode cancelations due calculation cannot exceed 3 percent of or performance year subset at the to overlap between the CJR model and the amount calculated in paragraph amount determined in paragraph (k) of other CMS models and programs, or for (e)(1)(iii) of this section. For this section for episodes affected by other reasons as specified in performance years 3 and 4 and for extreme and uncontrollable § 510.210(b). circumstances, or at the quality adjusted performance year subsets 5.1 and 5.2, (2) The subsequent calculation for target price determined for that episode the amount cannot exceed 5 percent of each of performance years 1 through 4 under § 510.300 for an episode with the amount calculated in paragraph and performance year subset 5.1 occurs actual episode payments that include a (e)(1)(iii) of this section. concurrently with the first claim with a COVID–19 diagnosis code (f) * * * reconciliation process for the following and initiate after the earlier of March 31, (1) * * * performance year (or in the case of 2021 or the last day of the emergency (ii) Subject to paragraph (f)(1)(iii) of performance year subset 5.1, with the period described in paragraph (k)(4) of this section, for performance years 2 first reconciliation of performance year this section. through 4 and for each of performance subset 5.2) . If the result of the (ii) Multiplies each episode quality- year subsets 5.1 and 5.2, results from the subsequent calculation is different than adjusted target price by the number of subsequent reconciliation calculation zero, CMS applies the stop-loss and episodes included in the performance for a prior year’s reconciliation as stop-gain limits in paragraph (e) of this year or performance year subset (other described in paragraph (i) of this section section to the aggregate calculation of than episodes that have been canceled and the post-episode spending and ACO the amounts described in paragraphs in accordance with § 510.210(b)) to overlap calculations as described in (e)(1)(iv) and (i)(1) of this section for which that episode quality-adjusted paragraph (j) of this section are added to that performance year or performance target price applies. the current year’s NPRA in order to year subset (the initial reconciliation

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and the subsequent reconciliation payments are capped at the quality § 510.400 Quality measures and reporting. calculation) to ensure such amount does adjusted target price determined for that (a) Reporting of quality measures. The not exceed the applicable stop-loss or episode under § 510.300. following quality measures are used for stop-gain limits. The subsequent ■ 28. Section 510.315 is amended by public reporting, for determining reconciliation calculation for revising paragraphs (a), (b) introductory whether a participant hospital is eligible performance year subset 5.2 will occur text, and (d) to read as follows: for reconciliation payments under independently in 2023. § 510.305(g), and whether a participant (j) Additional adjustments to the § 510.315 Composite quality scores for hospital is eligible for quality incentive reconciliation payment or repayment determining reconciliation payment payments under § 510.315(f) in the amount. (1) In order to account for eligibility and quality incentive payments. performance year or performance year shared savings payments, CMS will (a) General. A participant hospital’s subset: reduce the reconciliation payment or eligibility for a reconciliation payment * * * * * increase the repayment amount for the under § 510.305(g), and the subsequent performance year (for (b) * * * determination of quality incentive performance years 1 through 4 and (2) Hospitals must also submit the payments under paragraph (f) of this performance year subset 5.1) by the amount of requested THA/TKA patient- section, for a performance year or amount of the participant hospital’s reported outcomes data required for performance year subset depend on the discount percentage that is paid to the each performance year or performance hospital’s composite quality score ACO in the prior performance year as year subset of the model in order to be (including any quality performance shared savings. (This amount will be considered successful in submitting points and quality improvement points assessed independently for performance voluntary data. earned) for that performance year or year subset 5.2 in 2023.) This (i) The amount of requested THA/ performance year subset. adjustment is made only when the TKA patient-reported outcomes data to participant hospital is a participant or (b) Composite quality score. CMS submit, in order to be considered provider/supplier in the ACO and the calculates a composite quality score for successful will increase each beneficiary in the CJR episode is each participant hospital for each subsequent year of the model over the assigned to one of the following ACO performance year or performance year 5 years of the model (with the exception models or programs: subset which equals the sum of the of performance year subset 5.2, for (i) The Pioneer ACO model. following: which CMS will request the same (ii) The Medicare Shared Savings * * * * * amount of THA/TKA patient-reported Program (excluding Track 3 for CJR (d) Quality improvement points. For outcomes data as performance year episodes that initiate on or after , performance year 1, if a participant subset 5.1, updated to reflect the 2017). hospital’s quality performance timeframe applicable to performance (iii) The Comprehensive ESRD Care percentile on an individual measure year subset 5.2). Initiative (excluding a track with described in § 510.400(a) increases from (ii) A phase-in approach that downside risk for CJR episodes that the corresponding time period in the determines the amount of requested initiate after July 1, 2017). previous year by at least 2 deciles on the THA/TKA patient-reported outcomes (iv) The Next Generation ACO model performance percentile scale, then the data to submit over performance years 1 (excluding CJR episodes that initiate on hospital is eligible to receive quality through 4 and performance year subset or after July 1, 2017). 5.1 (with the exception of performance (2) If the average post-episode improvement points equal to 10 percent of the total available point for that year subset 5.2, for which CMS will Medicare Parts A and B payments for a request the same amount of THA/TKA participant hospital in the prior individual measure up to a maximum composite quality score of 20 points. patient-reported outcomes as performance year or performance year performance year subset 5.1, updated to subset is greater than 3 standard For each of performance years 2 through 4 and for each of performance year reflect the timeframe applicable to deviations above the regional average performance year subset 5.2) of the post-episode payments for the same subsets 5.1 and 5.2, if a participant hospital’s quality performance program will be applied so that in year performance year or performance year 1 successful submission of data would subset, then the spending amount percentile on an individual measure described in § 510.400(a) increases from mean CMS received all requested THA/ exceeding 3 standard deviations above TKA patient-reported outcomes and the regional average post-episode the previous performance year or performance year subset by at least 2 limited risk variable data on both of the payments for the same performance year following: or performance year subset is subtracted deciles on the performance percentile scale, then the hospitals is eligible to * * * * * from the net reconciliation or added to (3) * * * the repayment amount for the receive quality improvement points (v) Year 5 (subset 5.1, January 1, subsequent performance year for years 1 equal to 10 percent of the total available 2020–December 31, 2020). Submit— through 4 and performance year subset point for that individual measure up to 5.1, and assessed independently for a maximum composite quality score of * * * * * performance year subset 5.2. 20 points. (vi) Year 5 (subset 5.2, January 1, (k) * * * * * * * * 2021–September 30, 2021). Submit— (4) For a fracture or non-fracture ■ 29. Section 510.400 is amended by— (A) Post-operative data on primary elective THA/TKA procedures for ≥80% episode with a date of admission to the ■ anchor hospitalization that is on or a. Revising paragraphs (a) or ≥200 procedures performed between within 30 days before the date that the introductory text, (b)(2) introductory July 1, 2019 and June 30, 2020; and emergency period (as defined in section text, (b)(2)(i), (b)(2)(ii) introductory text, (B) Pre-operative data on primary 1135(g) of the Act) begins or that occurs and (b)(3)(v) introductory text; and elective THA/TKA procedures for ≥80% on or before March 31, 2021 or the last ■ b. By adding paragraph (b)(3)(vi). or ≥200 procedures performed between day of such emergency period, The revisions and addition read as July 1, 2020 and June 30, 2021, unless whichever is earlier, actual episode follows: CMS requests a more limited data set, in

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which case, submit all requested data the Centers for Disease Control and (ii) Notwithstanding paragraph elements. Prevention. (b)(2)(i) of this section, to the extent a * * * * * * * * * * recommendation or guideline described (3) * * * in paragraph (a)(1)(i) of this section that DEPARTMENT OF HEALTH AND (i) Subject to paragraphs (a)(3)(ii) and was in effect on the first day of a plan HUMAN SERVICES (iii) of this section, nothing in this year (in the individual market, policy Office of the Secretary section requires a plan or issuer that has year), or as otherwise provided in a network of providers to provide paragraph (b)(3) of this section, is For the reasons set forth in the benefits for items or services described downgraded to a ‘‘D’’ rating, or any item preamble, the Department of Health and in paragraph (a)(1) of this section that or service associated with any Human Services amends 45 CFR parts are delivered by an out-of-network recommendation or guideline specified 147, 155, and 182 as set forth below: provider, or precludes a plan or issuer in paragraph (a)(1) of this section is PART 147—HEALTH INSURANCE that has a network of providers from subject to a safety recall or is otherwise REFORM REQUIREMENTS FOR THE imposing cost-sharing requirements for determined to pose a significant safety GROUP AND INDIVIDUAL HEALTH items or services described in paragraph concern by a Federal agency authorized INSURANCE MARKETS (a)(1) of this section that are delivered to regulate the item or service during a by an out-of-network provider. plan or policy year, there is no ■ 30. The authority citation for part 147 * * * * * requirement under this section to cover is revised to read as follows: (iii) A plan or issuer must provide these items and services through the last day of the applicable plan or policy Authority: 42 U.S.C. 300gg through 300gg– coverage for and must not impose any cost-sharing requirements (such as a year. 63, 300gg–91, and 300gg–92, as amended, (3) Rapid coverage of preventive and section 3203, Pub. L. 116–136, 134 Stat. copayment, coinsurance, or a 281. deductible) for any qualifying services for coronavirus. In the case of a qualifying coronavirus preventive ■ 31. Section 147.130 is amended— coronavirus preventive service described in paragraph (a)(1)(v) of this service described in paragraph (a)(1)(v) ■ a. In paragraph (a)(1)(iii) by removing of this section, a plan or issuer must ‘‘and’’ after the semicolon; section, regardless of whether such service is delivered by an in-network or provide coverage for such item, service, ■ b. In paragraph (a)(1)(iv) by removing out-of-network provider. For purposes or immunization in accordance with the period at the end of the paragraph of this paragraph (a)(3)(iii), with respect this section by the date that is 15 and adding ‘‘; and’’ in its place; business days after the date on which a ■ to a qualifying coronavirus preventive c. By adding paragraph (a)(1)(v); service and a provider with whom the recommendation specified in paragraph ■ d. By revising paragraph (a)(3)(i); plan or issuer does not have a (a)(1)(v)(A) or (B) of this section is made ■ e. By adding paragraph (a)(3)(iii); negotiated rate for such service (such as relating to such item, service, or ■ f. By revising paragraphs (b)(1) and an out-of-network provider), the plan or immunization. (b)(2)(i) and (ii); and issuer must reimburse the provider for * * * * * ■ g. By adding paragraphs (b)(3) and (e). such service in an amount that is (e) Sunset date. The provisions of The revisions and additions read as reasonable, as determined in paragraphs (a)(1)(v), (a)(3)(iii), and (b)(3) follows: comparison to prevailing market rates of this section will not apply with for such service. respect to a qualifying coronavirus § 147.130 Coverage of preventive health preventive service furnished on or after services. * * * * * (b) * * * the expiration of the public health (a) * * * (1) In general. A plan or issuer must emergency determined on January 31, (1) * * * provide coverage pursuant to paragraph 2020, to exist nationwide as of January (v) Any qualifying coronavirus (a)(1) of this section for plan years (in 27, 2020, by the Secretary of Health and preventive service, which means an the individual market, policy years) that Human Services pursuant to section 319 item, service, or immunization that is begin on or after September 23, 2010, or, of the Public Health Service Act, as a intended to prevent or mitigate if later, for plan years (in the individual result of COVID–19, including any coronavirus disease 2019 (COVID–19) market, policy years) that begin on or subsequent renewals of that and that is, with respect to the after the date that is one year after the determination. individual involved— date the recommendation or guideline is PART 155—EXCHANGE (A) An evidence-based item or service issued, except as provided in paragraph ESTABLISHMENT STANDARDS AND that has in effect a rating of A or B in (b)(3) of this section. OTHER RELATED STANDARDS the current recommendations of the (2) * * * United States Preventive Services Task (i) A plan or issuer that is required to UNDER THE AFFORDABLE CARE ACT Force; or provide coverage for any items and ■ 32. The authority citation for part 155 (B) An immunization that has in effect services specified in any continues to read as follows: a recommendation from the Advisory recommendation or guideline described Committee on Immunization Practices in paragraph (a)(1) of this section on the Authority: 42 U.S.C. 18021–18024, 18031– 18033, 18041–18042, 18051, 18054, 18071, of the Centers for Disease Control and first day of a plan year (in the individual and 18081–18083. Prevention (regardless of whether the market, policy year), or as otherwise ■ 33. Section 155.1318 is added to read immunization is recommended for provided in paragraph (b)(3) of this as follows: routine use). For purposes of this section, must provide coverage through paragraph (a)(1)(v)(B), a the last day of the plan or policy year, § 155.1318 Modification from the normal recommendation from the Advisory even if the recommendation or public notice requirements during the Committee on Immunization Practices guideline changes or is no longer public health emergency. of the Centers for Disease Control and described in paragraph (a)(1) of this (a) The Secretary and the Secretary of Prevention is considered in effect after section, during the applicable plan or the Treasury may modify, in part, the it has been adopted by the Director of policy year. State public notice requirements under

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§ 155.1312 and the Federal public notice alternative State or Federal public (C) The State must detail in its request procedures under § 155.1316 to expedite notice procedures, as applicable. for a modification under paragraph a decision on a proposed waiver request (e) The State must publish on its (c)(2) of this section the alternative post during the public health emergency, as website any modification requests and award public notice procedures it defined in 42 CFR 400.200, when a determinations within 15 calendar days proposes to implement at the State delay would undermine or compromise of receipt of the determination, as well level, including public hearings, that are the purpose of the proposed waiver as the approved revised timeline for designed to provide the greatest request and be contrary to the interests public comment under the alternative opportunity and level of meaningful of consumers. These flexibilities are State or Federal public notice public input from impacted limited to event-triggered, emergent procedures, as applicable. stakeholders that is practicable given situations, and the flexibilities outlined (f) The State must, as applicable, the emergency circumstances in this section will not be available for implement the alternative public notice underlying the State’s request for a States seeking to address a threat to procedures at the State level if the modification. consumers’ access to health coverage or State’s modification request is approved (D) The Secretary and the Secretary of care that existed prior to the public and, if required, amend the waiver the Treasury will evaluate a State’s health emergency for COVID–19. application request. request for a modification under (b) A State must meet all of the ■ 34. Section 155.1320 is amended— paragraph (c)(2) of this section and issue following criteria to request a ■ a. In paragraph (c)(1) by adding a their modification determination within modification under paragraph (a) of this paragraph heading; and approximately 15 calendar days after section: ■ b. By adding paragraph (c)(2). the request is received. (1) The State must request a (E) The State must publish on its The additions read as follows: modification under paragraph (a) of this website any modification requests and section, in the form and manner § 155.1320 Monitoring and compliance. determinations within 15 calendar days specified by the Secretaries. * * * * * of receipt of the determination, as well (2) The State must have acted in good as information on the approved revised faith, and in a diligent, timely, and (c) * * * (1) Notification requirements for timeline for the State’s post award prudent manner in the preparation of public notice procedures, as applicable. the request for a modification under public forum. *** * * * * * paragraph (a) of this section, and the (2) Modification from the normal post ■ waiver application request, as award requirements during the public 35. Subchapter E–T, consisting of part applicable. health emergency. (i) The Secretary and 182, is added to subtitle A to read as (3) The State must, as applicable, the Secretary of the Treasury may follows: detail in its request for a modification modify, in part, State post award Subchapter E–T—Price Transparency from State-level notice procedures requirements under this paragraph (c)(2) under paragraph (a) of this section the for an approved waiver request during PART 182—PRICE TRANSPARENCY justification for the request as it relates the public health emergency, as defined FOR COVID–19 DIAGNOSTIC TESTS in 42 CFR 400.200, when the to the public health emergency and the Subpart A—General Provisions alternative public notice procedures it application of the post award public proposes to implement at the State notice requirements would be contrary Sec. 182.10 Basis and scope. level, including public hearings, that are to the interests of consumers during the public health emergency. These 182.20 Definitions. designed to provide the greatest 182.30 Applicability. opportunity and level of meaningful flexibilities are limited to event- public input from impacted triggered, emergent situations, and the Subpart B—Public Disclosure Requirements stakeholders that is practicable given flexibilities outlined in this section will the emergency circumstances not be available for States seeking to 182.40 Requirements for making public underlying the State’s request for a address a threat to consumers’ access to cash prices for a diagnostic test for COVID–19. modification. health coverage or care that existed (4) The State must, as applicable, prior to the public health emergency for Subpart C—Monitoring and Penalties for detail in its request for a modification COVID–19. Noncompliance from Federal-level notice procedures (ii) A State must meet all of the 182.50 Monitoring and enforcement. under paragraph (a) of this section the following criteria to request a 182.60 Corrective action plans. justification for the request and the modification under paragraph (c) of this 182.70 Civil monetary penalties. alternative public notice procedures it section: Subpart D—Appeals of Civil Monetary requests to be implemented at the (A) The State must request a Penalties modification under paragraph (c)(2) of Federal level. 182.80 Appeal of penalty. (c) The Secretary and the Secretary of this section, in the form and manner 182.90 Failure to request a hearing. the Treasury will evaluate a State’s specified by the Secretaries. (B) The State must have acted in good Authority: Section 3202(b), Pub. L. 116– request for a modification under 136, 134 Stat. 281. paragraph (a) of this section and issue faith, and in a diligent, timely, and their modification determination within prudent manner to comply with the Subpart A—General Provisions approximately 15 calendar days after monitoring and compliance requirement the request is received. under the waiver and the terms and § 182.10 Basis and scope. (d) The Secretary will publish on the conditions of the agreement between the This part implements section CMS website any modification Secretary and the Secretary of the 3202(b)(1) of the Coronavirus Aid, determinations within 15 calendar days Treasury, as applicable, and the State to Relief, and Economic Security Act (Pub. of the Secretary and the Secretary of the implement a section 1332 waiver and to L. 116–136, March 27, 2020) (CARES Treasury making such a determination, submit and prepare the request for a Act), which requires that during the as well as the approved revised timeline modification under paragraph (c)(2) of emergency period declared under for public comment under the approved this section. section 319 of the PHS Act (42 U.S.C.

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247d), providers of diagnostic tests for (2) The information described in (b) Actions to address provider COVID–19 make public the cash price paragraph (c) of this section, or a link to noncompliance. If CMS concludes that for such tests on a public internet such information, must appear in a the provider is noncompliant with one website of such provider. This part also conspicuous location on a searchable or more of the requirements of § 182.40, implements section 3202(b)(2) of the homepage of the provider’s website. CMS may take any of the following CARES Act, which authorizes the (3) The information described in actions: Secretary to impose a civil monetary paragraph (c) of this section must be (1) Provide a written warning notice penalty (CMP) on any provider of a displayed in a manner that is easily to the provider of the specific diagnostic test for COVID–19 that does accessible, without barriers, and ensures violation(s). not comply with section 3202(b)(1) of that the information is accessible: (2) Request that the provider submit the CARES Act and that has not (i) Free of charge; and comply with a corrective action completed a corrective action plan to (ii) Without having to establish a user plan under § 182.60. comply with that section, in an amount account or password; and (3) Impose a civil monetary penalty that does not exceed $300 per day that (iii) Without having to submit on the provider if the provider fails to the violation is ongoing. personal identifiable information (PII). respond to CMS’ request to submit a (4) The provider must include all of corrective action plan or to comply with § 182.20 Definitions. the following terms on its homepage: the requirements of a corrective action The following definitions and (i) The provider’s name; plan approved by CMS. abbreviated terms apply to this part: (ii) The term ‘‘price’’; Cash price means the charge that (iii) The term ‘‘cost’’; § 182.60 Corrective action plans. applies to an individual who pays cash (iv) The term ‘‘test’’; (a) Violations requiring a corrective (or cash equivalent) for a COVID–19 (v) The term ‘‘COVID’’; and action plan. If CMS determines a diagnostic test. (vi) The term ‘‘coronavirus’’. provider’s noncompliance with the COVID–19 for purposes of this part is (b) Exception. A provider of a COVID– requirements of this part continues after the abbreviated term for the virus called 19 diagnostic test that does not have its a warning notice, a corrective action SARS-CoV–2 and the disease it causes, own website must make public the plan may be required. A violation may called coronavirus disease 2019. information described in paragraph (c) include, but is not limited to, the Diagnostic test for COVID–19 of this section: following: (‘‘COVID–19 diagnostic test’’) means a (1) In writing, within two business (1) A provider’s failure to make public COVID–19 in vitro diagnostic test days upon request; and its cash price information required by described in section 6001 of the (2) On a sign posted prominently at § 182.40. Families First Coronavirus Response the location where the provider offers a (2) A provider’s failure to make public Act (Pub. L. 116–127, March 18, 2020), COVID–19 diagnostic test, if such its cash price information in the form as amended by section 3201 of the location is accessible to the public. and manner required under § 182.40. CARES Act (Pub. L. 116–136, March 27, (c) Required information. For (b) Notice of violation. CMS may 2020). purposes of paragraphs (a) and (b) of request that a provider submit and Provider of a diagnostic test for this section, the provider must make comply with a corrective action plan, COVID–19 (‘‘provider’’) means any public the following information: specified in a notice of violation issued facility that performs one or more (1) A plain-language description of by CMS to a provider. COVID–19 diagnostic tests. each COVID–19 diagnostic test that is (c) Compliance with corrective action § 182.30 Applicability. offered by the provider; plan requests and corrective actions. (1) A provider required to submit a (a) General applicability. The (2) The billing code used for each COVID–19 diagnostic test; corrective action plan must do so, in the requirements of this part apply to each form and manner, and by the deadline, provider of a diagnostic test for COVID– (3) The provider’s cash price for each such COVID–19 diagnostic test; and specified in the notice of violation 19 as defined at § 182.20. issued by CMS to the provider, and (b) Duration of requirements. The (4) Any additional information as may must comply with the requirements of requirements of this part are applicable be necessary for the public to have the corrective action plan approved by during the public health emergency certainty of the cash price that applies CMS. (PHE) determined to exist nationwide as to each COVID–19 diagnostic test. (2) A provider’s corrective action plan of January 27, 2020, by the Secretary of Subpart C—Monitoring and Penalties must specify elements including, but Health and Human Services pursuant to for Noncompliance not limited to: section 319 of the PHS Act on January (i) The corrective actions or processes 31, 2020, as a result of confirmed cases § 182.50 Monitoring and enforcement. the provider will take to address the of COVID–19, including any subsequent (a) Monitoring. (1) CMS may evaluate deficiency or deficiencies identified by renewals. whether a provider has complied with CMS. Subpart B—Public Disclosure the requirements under § 182.40. (ii) The timeframe by which the Requirements (2) CMS may use methods to monitor provider will complete the corrective and assess provider compliance with action. § 182.40 Requirements for making public the requirements under this part, (3) A corrective action plan is subject cash prices for a diagnostic test for COVID– including, but not limited to, the to CMS review and approval. 19. following, as appropriate: (4) After CMS’ review and approval of (a) General rules. (1) Except as (i) CMS’ evaluation of complaints a provider’s corrective action plan, CMS provided under paragraph (b) of this made to CMS. may monitor and evaluate the provider’s section, a provider of a COVID–19 (ii) CMS review of an individual’s or compliance with the corrective actions diagnostic test must make public the entity’s analysis of noncompliance as specified in the corrective action plan. information described in paragraph (c) stated in the complaint. (d) Noncompliance with corrective of this section electronically via the (iii) CMS review of providers’ action plan requests and requirements. internet. websites. (1) A provider’s failure to respond to

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CMS’ request to submit a corrective pursuant to continuing violations, as specified in paragraph (b) of this action plan includes failure to submit a without right of appeal in accordance section. corrective action plan in the form, with § 182.90. (b) For purposes of applying subpart manner, or by the deadline, specified in (3) If the civil monetary penalty is D of part 150 of this title to appeals of a notice of violation issued by CMS to upheld, in part, by a final and binding civil monetary penalties under this part: the provider. decision according to subpart D of this (2) A provider’s failure to comply part, CMS will issue a modified notice (1) ‘‘Respondent’’ means a provider, with the requirements of a corrective of imposition of a civil monetary as defined in § 182.20 that received a action plan includes failure to correct penalty, to conform to the adjudicated notice of imposition of a civil monetary violation(s) within the specified finding. penalty according to § 182.70(b). timeframes. (c) Amount of the civil monetary (2) In deciding whether the amount of penalty. (1) CMS may impose a civil a civil money penalty is reasonable, the § 182.70 Civil monetary penalties. monetary penalty upon a provider for a administrative law judge (ALJ) may only (a) Basis for imposing civil monetary violation of each requirement of this consider evidence of record relating to penalties. CMS may impose a civil part. the following: monetary penalty on a provider (2) The maximum daily dollar amount (i) The provider’s posting(s) of its cash identified by CMS as noncompliant for a civil monetary penalty to which a price information, if available. according to § 182.50, and that fails to provider may be subject is $300. Even respond to CMS’ request to submit a if the provider is in violation of multiple (ii) Material the provider timely corrective action plan or to comply with discrete requirements of this part, the previously submitted to CMS (including the requirements of a corrective action maximum total sum that a single with respect to corrective actions and plan approved by CMS as described in provider may be assessed per day is corrective action plans). § 182.60(d). $300. (iii) Material CMS used to monitor (b) Notice of imposition of a civil (3) The maximum daily amount of the and assess the provider’s compliance monetary penalty. (1) If CMS imposes a civil monetary penalty will be adjusted according to § 182.70(a)(2). penalty in accordance with this part, annually using the multiplier CMS will provide a written notice of determined by the Office of (3) The ALJ’s consideration of imposition of a civil monetary penalty Management and Budget for annually evidence of acts other than those at to the provider via certified mail or adjusting civil monetary penalty issue in the instant case under another form of traceable carrier. amounts under part 102 of this title. § 150.445(g) of this title does not apply. (2) This notice to the provider may (d) Timing of payment of civil § 182.90 Failure to request a hearing. include, but is not limited to, the monetary penalty. (1) A provider must following: pay the civil monetary penalty in full (a) If a provider does not request a (i) The basis for the provider’s within 60 calendar days after the date of hearing within 30 calendar days of the noncompliance, including, but not the notice of imposition of a civil issuance of the notice of imposition of limited to, the following: monetary penalty from CMS under a civil monetary penalty described in (A) CMS’ determination as to which paragraph (b) of this section. § 182.70(b), CMS may impose the civil requirement(s) the provider has (2) In the event a provider requests a monetary penalty indicated in such violated. hearing, pursuant to subpart D of this notice without right of appeal in (B) The provider’s failure to respond part, the provider must pay the amount accordance with this part. to CMS’ request to submit a corrective in full within 60 calendar days after the (1) If the 30th calendar day described action plan or comply with the date of a final and binding decision, paragraph (a) of this section is a requirements of a corrective action plan, according to subpart D of this part, to weekend or a Federal holiday, then the as described in § 182.60(d). uphold, in whole or in part, the civil timeframe is extended until the end of (ii) CMS’ determination as to the monetary penalty. the next business day. effective date for the violation(s). This (3) If the 60th calendar day described date is the latest date of the following: in paragraphs (d)(1) and (2) of this (2) [Reserved] (A) The first day the provider is section is a weekend or a Federal (b) The provider has no right to required to meet the requirements of holiday, then the timeframe is extended appeal a penalty with respect to which this part. until the end of the next business day. it has not requested a hearing in (B) A date determined by CMS, such (4) In the event a civil money penalty accordance with § 150.405 of this title, as one resulting from monitoring is not paid in full within 60 days, CMS unless the provider can show good activities specified in § 182.50, or will follow the collections activities set cause, as determined at § 150.405(b) of development of a corrective action plan forth in 45 CFR part 30. this title, for failing to timely exercise its as specified in § 182.60. (e) Continuing violations. CMS may right to a hearing. (iii) The amount of the penalty as of issue subsequent notice(s) of imposition the date of the notice. of a civil monetary penalty, according to PART 182 [Transferred to Subchapter (iv) A statement that a civil monetary paragraph (b) of this section, that result E] penalty may continue to be imposed for from the same instance(s) of continuing violation(s). noncompliance. ■ 36. Effective January 1, 2021, transfer (v) Payment instructions. part 182 from subchapter E–T to (vi) A statement of the provider’s right Subpart D—Appeals of Civil Monetary subchapter E. to a hearing according to subpart D of Penalties this part. Subchapter E–T [Removed] (vii) A statement that the provider’s § 182.80 Appeal of penalty. ■ failure to request a hearing within 30 (a) A provider upon which CMS has 37. Effective January 1, 2021, remove calendar days of the issuance of the imposed a penalty under this part may subchapter E–T. notice permits the imposition of the appeal that penalty in accordance with [FR Doc. 2020–24332 Filed 11–2–20; 4:15 pm] penalty, and any subsequent penalties subpart D of part 150 of this title, except BILLING CODE 4120–01–P

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