[Federal Register Volume 63, Number 147 (Friday, July 31, 1998)]
[Rules and Regulations]
[Pages 41170-41171]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-20628]
[[Page 41169]]
_______________________________________________________________________
Part V
Department of Health and Human Services
_______________________________________________________________________
Health Care Financing Administration
_______________________________________________________________________
42 CFR Parts 441 and 489
Medicare and Medicaid Programs: Surety Bond Requirements for Home
Health Agencies; Final Rule
Federal Register / Vol. 63, No. 147, Friday, July 31, 1998 / Rules
and Regulations
[[Page 41170]]
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
42 CFR Parts 441 and 489
[HCFA-1152-2-F]
RIN 0938-AJ08
Medicare and Medicaid Programs; Surety Bond Requirements for Home
Health Agencies
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule revised Medicare and Medicaid regulations
concerning surety bond requirements published in the Federal Register
(63 FR 29648) on June 1, 1998. Those regulations specified submission
compliance dates for all home health agencies (HHAs) to furnish a
surety bond to HCFA and/or to the State Medicaid agency. This rule
removes those submission compliance dates.
EFFECTIVE DATE: This final rule is effective on July 31, 1998.
FOR FURTHER INFORMATION CONTACT: Ralph Goldberg, (410) 786-4870
(Medicare Provisions. Mary Linda Morgan, (410) 786-2011 (Medicare
Provisions.
SUPPLEMENTARY INFORMATION:
I. Background
The Balanced Budget Act of 1997 (BBA '97) requires each home health
agency (HHA) to secure a surety bond in an amount of at least $50,000
in order to participate in either the Medicare or the Medicaid program.
This requirement applies to all participating Medicare and Medicaid
HHAs, regardless of the date their participation began. We published a
final rule in the Federal Register on January 5, 1998 (63 FR 292-355)
to implement the surety bond requirements.
Generally, that rule requires each HHA participating in Medicare to
obtain from an authorized Surety and then to furnish to the fiscal
intermediary a surety bond in an amount that is the greater of $50,000
or 15 percent of the annual amount paid to the HHA by the Medicare
program, as such annual amount appears in the HHA's most recently
accepted cost report.
The rule also prohibits payment to a State for home health services
furnished to Medicaid recipients unless the HHA has furnished the
Medicaid State agency with a surety bond similar to one that meets
Medicare requirements. The amount of the Medicaid surety bond would be
the greater of $50,000 or 15 percent of the annual amount paid to the
HHA by the Medicaid State agency for home health services.
As a result of technical issues concerning potential Surety
liability raised by representatives of both the Surety and HHA
industries after the publication of the January 5, 1998 final rule, we
published a notice in the Federal Register on March 4, 1998 (63 FR
10732). That notice advised the public that we intended to make
technical revisions to the January 5, 1998 final rule. In another final
rule also published in the March 4, 1998 Federal Register (63 FR
10730), we removed the February 27, 1998 bond submission compliance
date, and announced that we intended to establish a new submission
compliance date that would be a date 60 days after the publication of a
subsequent final rule.
On June 1, 1998, an additional final rule was published in the
Federal Register (63 FR 29648), that addressed all of the technical
changes announced in the March 4, 1998 notice and revised certain
sections of the January 5, 1998 final rule. That rule also established
that the initial submission of a surety bond for Medicare is July 31,
1998 and for Medicaid by a date specified by each Medicaid State agency
but no later than September 29, 1998.
Because of significant concerns expressed by the United States
Congress and HHAs, and notification that the General Accounting Office
(GAO) is investigating issues surrounding the surety bond requirement
we will suspend the compliance date until we evaluate the GAO report.
Although the surety bond requirements remain in effect, the
practical effect of this document is to absolve participating HHAs from
having to show compliance with the requirements until 60 days following
publication of a new final rule but no earlier than February 15, 1999.
II. Provisions of this Final Rule
This rule removes the submission compliance dates that specify when
participating HHAs must submit a surety bond in both the Medicare and
Medicaid programs.
III. Waiver of Proposed Rulemaking
We ordinarily publish a notice of proposed rulemaking in the
Federal Register and invite prior public comment on proposed rules. The
notice of proposed rulemaking can be waived, however, if an agency
finds good cause that notice-and-comment procedure is impracticable,
unnecessary, or contrary to the public interest and incorporates a
statement of the finding and its reasons in the rule issued. We find
good cause to waive the notice-and-comment procedure because it is
impracticable to employ notice and comment procedures and issue a final
rule on or before the earliest date currently required for HHAs to
comply with surety bond submission (July 31, 1998). For this reason, we
find good cause to waive notice-and-comment and to issue this final
rule.
IV. Waiver of 30-Day Delay in Effective Date
We ordinarily make the effective date of a final rule at least 30
days after the publication of the rule in the Federal Register.
However, this 30-day delay can be waived if an agency finds good cause
for making the effective date of the rule earlier than 30 days after
the publication of the rule. For the same reason discussed in section
III. above we find it would be impracticable to delay the effective
date of this rule. Therefore, we find good cause to waive the 30-day
delay in the effective date for this rule and have made the effective
date the date of publication in the Federal Register.
V. OMB Review
In accordance with the provisions of E.O. 12866, this document was
reviewed by the Office of Management and Budget.
List of Subjects
42 CFR Part 441
Family planning, Grant programs--health, Infants and children,
Medicaid, Penalties, Reporting and recordkeeping requirements.
42 CFR Part 489
Health facilities, Medicare, Reporting and recordkeeping
requirements.
42 CFR Chapter IV is amended as set forth below:
PART 441--SERVICES: REQUIREMENTS AND LIMITS APPLICABLE TO SPECIFIC
SERVICES
A. Part 441 is amended as follows:
1. The authority citation for part 441 continues to read as
follows:
Authority: Sec. 1102 of the Social Security Act (42 U.S.C.
1302).
2. In Sec. 441.16 the heading of paragraph (i) and paragraph (i)(1)
are revised to read as follows: Sec. 441.16 Home health agency
requirements for surety bonds; Prohibition on FFP.
* * * * *
(i) Term and type of bond. (1) Initial term: Each participating HHA
that is not
[[Page 41171]]
exempted by paragraph (d) of this section must submit to the State
Medicaid agency a surety bond for a term beginning January 1, 1998. If
an annual bond is submitted for the initial term it must be effective
for an annual period specified by the State Medicaid agency.
* * * * *
PART 489--PROVIDER AGREEMENTS AND SUPPLIER APPROVALS
B. Part 489 is amended as follows:
1. The authority citation for part 489 continues to read as
follows:
Authority: Secs. 1102 and 1871 of the Social Security Act (42
U.S.C. 1302 and 1395hh).
2. in Sec. 489.67 the heading and paragraph (a) are revised to read
as follows:
Sec. 489.67 Term and type of bond.
(a) Each participating HHA that does not meet the criteria for
waiver under Sec. 489.62 must submit to HCFA in a form as HCFA may
specify, a surety bond for a term beginning January 1, 1998. If an
annual bond is submitted for the initial term, it must be effective
through the end of the HHA's current fiscal year.
* * * * *
(Authority: Secs. 1102 and 1871 of the Social Security Act (42
U.S.C. 1302 and 1395hh)).
(Catalog of Federal Domestic Assistance Program No. 93.774,
Medicare--Supplementary Medical Insurance Programs, and Program No.
93.778, Medical Assistance Program).
Dated July 27, 1998.
Nancy-Ann Min DePearle,
Administrator, Health Care Financing Administration.
Dated July 28, 1998.
Donna E. Shalala,
Secretary.
[FR Doc. 98-20628 Filed 7-29-98; 1:38 pm]
BILLING CODE 4120-01-M
