[Federal Register Volume 64, Number 46 (Wednesday, March 10, 1999)]
[Rules and Regulations]
[Pages 11765-11771]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5528]
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DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 199
RIN 0720-AA27
Civilian Health and Medical Program of the Uniformed Services
(CHAMPUS); Provider Certification Requirements--Corporate Services
Provider Class
AGENCY: Office of the Secretary, DoD.
ACTION: Final rule.
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SUMMARY: This final rule presents requirements to permit payment of
professional or technical health care services rendered by certain
corporate providers; makes changes to clarify the general requirements
for individual professional providers; and adds standard provider
participation agreement provisions when such agreements are otherwise
required.
DATES: This rule is effective June 8, 1999.
ADDRESSES: TRICARE Management Activity, Medical Benefits and
Reimbursement Systems, 16401 East Centretech Parkway, Aurora, CO 80011-
9043.
FOR FURTHER INFORMATION CONTACT: David E. Bennett, TRICARE Management
Activity, Medical Benefits and Reimbursement Systems, telephone (303)
676-3492.
SUPPLEMENTARY INFORMATION:
I. Introduction and Background
CHAMPUS supplements the availability of health care in military
hospitals and clinics. Services and items allowable as CHAMPUS benefits
must be obtained from CHAMPUS authorized civilian providers to be
considered for payment. Requirements for CHAMPUS provider authorization
are published under 32 CFR 199.6.
CHAMPUS currently has requirements for three classes of providers.
The institutional provider class includes hospitals and other
categories of similar facilities. The individual professional providers
class includes physicians and other categories of licensed individuals
who render professional services independently, and certain allied
health and extra medical providers that must function under physician
orders and supervision. The third class of providers consists of
sellers of items and supplies of an ancillary or supplemental nature
such as durable medical equipment.
CHAMPUS payment depends upon a service being both allowable as a
benefit and rendered by a CHAMPUS authorized provider. Consequently, it
is currently possible, for example, that outpatient treatment by a
physical therapist employed by a hospital may be paid (to the hospital)
while the same service provided by an employee of a freestanding
corporation or foundation is denied payment.
This administrative exclusion is difficult for beneficiaries to
apply when seeking health care services because it requires an
understanding of the underlying business structure of the provider. But
the underlying business structure of a provider organization is
[[Page 11766]]
important to CHAMPUS management decisions regarding quality assurance
and payment methods.
Corporations, both not-for-profit and shareholder, and foundations
are an alternative source of ambulatory and in-home care. The proposed
addition of the corporate class will recognize the current range of
providers within today's health care delivery structure, and give
beneficiaries access to another segment of the health care delivery
industry.
II. Provisions of the Rule
A. New Provider Category (Revisions to Sec. 199.6(f)
This paragraph creates a fourth class of CHAMPUS provider
consisting of freestanding corporations and foundations that render
principally professional ambulatory or in-home care and technical
diagnostic procedures. The intent of the rule is not to create
additional benefits that ordinarily would not be covered under CHAMPUS
is provided by a more traditional health care delivery system, but
rather to allow those services which would otherwise be allowed except
for an individual provider's affiliation with a freestanding corporate
facility.
While is recognized that some of the services and supplies provided
by freestanding corporate providers may substantially reduce costs in
comparison to extended care provided in a hospital, it is often
difficult to control the type and level of care actually provided
within these alternative treatment settings. It is also recognized that
some of the alternative delivery setting, such a Home Health Agencies
and Comprehensive Outpatient Rehabilitation Facilities, provide
services that are not a covered benefit under CHAMPUS. Often care
rendered in these setting is provided by an individual who is not
recognized by CHAMPUS as an authorized provider in his or her own right
(i.g., home health aides in the case of home health care), and as such,
is not covered under the provisions of this rule. Otherwise covered
professional services provided by CHAMPUS authorized individual
providers employed by or under contract with a freestanding corporate
entity will be paid under the CHAMPUS Maximum Allowable Charge (CMAC)
reimbursement system, subject to any restrictions and limitations as
may be prescribed under existing CHAMPUS policy. The corporate entity
will not be allowed additional facility charges that are not already
incorporated into the professional service fee structure (i.e.,
facility charges that are not already included in the overhead and
malpractice cost indices used in establishing locally-adjusted CMAC
rates.)
Payment will also be allowed for supplies used by a CHAMPUS
authorized individual provider employed by or contracted with a
corporate services provider covered under the provisions of this rule
in the direct treatment of a CHAMPUS eligible beneficiary. Payment for
both professional services and supplies will be paid directly to the
CHAMPUS authorized corporate service provider under its own tax
identification number.
Coporate services providers must be approved for Medicare payment,
or when Medicare approval status is not required, be accredited by a
qualified accreditation organization as defined in 32 CFR 199.2 order
to gain provider authorization status under CHAMPUS. Corporate services
providers must also enter into a participation agreement which will be
sent out as part of the initial certification process. The
participation agreement will ensure that CHAMPUS determined allowable
payments, combined with the cost-share/copayment, deductible, and other
health insurance amounts, will be accepted by the provider as payment
in full.
B. Direct Payment for Occupational Therapist (Revisions to
Sec. 199.4(3)(x)) and Sec. 199.6(c)(3)(iii)(l)(3)
The proposed rule, which was published on March 8, 1995 (60 FR
12717), allowed qualified self-employed occupational therapists to be
authorized for direct payment for allowable services. However, the
services has to be prescribed and monitored by a physician and reduce
the disabling effects of an illness, injury, or neuromuscular disorder.
The treatment also had to increase, stabilize, or slow the
deterioration of the beneficiary's ability to perform specified
purposeful activity within the range considered normal for human being.
The provisions for occupational therapists were pulled from the
proposed Corporate Services Provider Class rule and included as part of
the Program from Persons with Disabilities (PFPWD) final rule was
published in the Federal Register on June 30, 1997, (62 CFR 35086).
(Public comments received in response to the occupational therapist
provisions contained in the proposed rule were addressed and responded
to the PFPWS final rule.
C. Provisions for Provider Participation (Revision of Definition of
``Participating Provider'' in Sec. 199.2, Clarification of Types of
Provider Participation in Sec. 199.6(a)(8) and Additional Requirements
for Participation Under Sec. 199.6(a)(12) and Sec. 199.6(a)(13))
The final amendment expands and clarifies the various types of
provider participation available under CHAMPUS, emphasizing mandatory
participation by the new Corporate Services Provider class. Corporate
service providers must enter into a participation agreement that at
least complies with the minimum participation agreement requirements as
outlined under Sec. 199.6(a)(13). The amendment also establishes
minimum medical documentation requirements for authorized provider
organizations and individuals providing clinical services under
CHAMPUS.
D. Removal of Exclusions (Removal of Sec. 199.4(g)(70) and
Sec. 199.4(g)(71))
This amendment removes provision which exclude CHAMPS coverage of
civilian diagnostic and consultation services requested by a Military
Treatment Facility (MTF) physician in support of continued MTF care of
a CHAMPUS-eligible beneficiary. Because MTF's vary in size and clinical
capacity for the care of CHAMPUS-eligible beneficiaries, the lack of
access to specialized diagnostic and consultation resources through
CHAMPUS may result in the MTF purchasing the civilian services directly
without the advantage of CHAMPUS price requirements; the beneficiary
paying the total cost of such non-MTF services; or the beneficiary
choosing to obtain all care in the civilian community in order to take
advantage of CHAMPUS cost-share of all the necessary care. Removal of
these exclusions will allow flexibility in the implementation of an
MTF-based plan-of-care resulting in continuity of care at a lower cost
to both the beneficiary and the government.
E. Professional Corporation or Association (Revision of
Sec. 199.6(c)(1) and Sec. 199.6(c)(2))
The final rule more clearly establishes that a professional
corporation or association is not itself a provider but may file claims
and receive payment on behalf of an individual professional provider
member. The corporate entity is simply acting as a billing agent for
its professional members (i.e., it is billing for its members'
professional services under a single tax identification number) who are
practicing within the scope of their individual state licenses,
[[Page 11767]]
or have otherwise passed qualifying certification tests. The conditions
for authorization have been expanded and rearranged to more clearly
present the other general requirements for this provider category.
III. Public Comments
As a result of the publication of the proposed rule, the following
comments were received from interested providers, associations, and
agencies.
Comment 1. One commentor offered its corporate and clinical
personnel to serve on any advisory boards which may be established to
address credentialing concerns.
Response. Although we appreciate the commentor's offer to lend its
expertise (i.e., both corporate and clinical staff) to any future
advisory boards that might be convened on credentialing concerns,
reliance on Medicare approval for payment--or when Medicare approved
status is not required, accreditation by a qualified accreditation
organization as defined by amendment--has been found to be
administratively expeditious and cost effective for the program. As a
result, we do not expect the need for convening any future advisory
boards since the new provider categories will already be subject to
nationally recognized certification criteria.
Comment 2. Several commentors had concerns on how the qualified
accreditation organization defined in Sec. 199.2 would reinforce
CHAMPUS authorization requirements and promote efficient delivery of
CHAMPUS benefits. It was recommended that the final rule list the
initial agencies and criteria for recognition.
Response. Specific references to accreditation agencies would
negate the agency's authority to promptly recognize by administrative
policy, rather than the much longer Code of Federal Register (CFR)
amendment process, those newly recognized accreditation agencies or
organizations which might come to meet the criteria set forth in this
final rule. While it is anticipated that most, if not all, of the
alternative treatment settings initially eligible for inclusion under
this new provider category are authorized for payment under Medicare,
there is a provision in the final rule (32 CFR 199.6(f)(2)(v)) which
allows accreditation by a qualified accrediting organization as defined
in the definition section of CFR (32 CFR 199.2) when Medicare approved
status is not required. This definition provides specific criteria for
recognition of qualified accreditation organizations under CHAMPUS.
Under the prescribed provisions set forth in this final rule, the
corporate entity must be an authorized provider under CHAMPUS in order
for payment of professional services to be authorized. For example, a
corporate entity which is neither recognized by Medicare or any other
accreditation organization as prescribed under the definition section
of the CFR (32 CFR 199.2), coverage could not be extended for
professional services even if the individual professional providers
would have otherwise been eligible for payment except for their
affiliation with the corporate entity. In other words, while the
expanded provider category will allow coverage of professional services
for corporate entities, meeting the conditions for authorization
established under this rule, it will at the same time restrict coverage
of professional services for those corporate entities which cannot meet
those criteria for corporate services provider authorization under
CHAMPUS.
Comment 3. One commentor recommended that comprehensive outpatient
rehabilitation facilities (CORFs) be explicitly addressed in the final
rule as a type of corporate service provider so there is no
misunderstanding in the future as to the ability of CORFs to provide
services to CHAMPUS beneficiaries.
Response: The response to this comment is similar to the rationale
used in the previous response as to why a list of qualified
accreditation agencies or organizations are not specifically listed in
the final rule. Again, a laundry list of qualifying corporate service
providers would negate the agency's authority to promptly recognize by
administrative policy, rather than having to go through the much longer
rulemaking procedures for those corporate service providers who may in
the future meet the criteria for authorization set down in this rule.
For example, recognition of a new corporate services provider as an
authorized provider under CHAMPUS would take three to six months
through the administrative policy process (i.e., simply making changes
to the program policy guidelines), compared to twelve to sixteen months
through the formal rulemaking.
Comment 4. Another commentor felt that specific guidelines for the
authorization process should be addressed in the final rule so that
there is no misunderstanding by the providers or CHAMPUS contractors.
Response. It is felt that the incorporation of specific
certification guidelines is unnecessary, since the authorization status
of corporate services providers under CHAMPUS is already contingent on
nationally recognized certification criteria (i.e., authorization/
certification guidelines established by Medicare and other accrediting
organizations as prescribed under the definition section of the CFR (32
CFR 199.2)). This would also impose an unnecessary administrative
burden on the agency, since 32 CFR 199 would have to be continually
updated to keep current with changes in national certification
guidelines for this particular provider class.
Comment 5. One commentor wanted to know the conditions under which
the Director, OCHAMPUS, or designee, may limit the term of a
participation agreement for corporate services. It was recommended that
limitations be explicit and known to the providers and CHAMPUS
contractors.
Response. As was stated previously, corporate services providers
must also enter into a participation agreement which will be sent out
as part of the initial certification process. The participation
agreement will ensure that CHAMPUS determined allowable payments,
combined with the cost-share/copayment, deductible, and other health
insurance amounts, will be accepted by the provider as payment in full.
The agreement will be binding on the provider and OCHAMPUS upon
acceptance by the Director, OCHAMPUS, or designee, and shall stay in
effect until terminated by either party. The effective day of the
participation will be the date the agreement is signed by the Director,
OCHAMPUS, or designee.
The agreement may be terminated by either party giving the other
party written notice of termination. Such notice of termination is to
be received by the other party no later than 45 days prior of the date
of termination. In the event of transfer of ownership, the agreement is
assigned to the new owner, subject to the conditions specified in this
agreement and pertinent regulations. The participation agreement will,
at a minimum, contain all of the required provisions as outlined in
this rule (32 CFR 199.6(a)(13)). Violation of one or more of these
requirements will be ground for termination by the Director, OCHAMPUS,
or designee.
Comment 6. Another commentor wants to know if the definition of a
corporate services provider encompasses vocational rehabilitation
facilities and other community based rehabilitation providers.
Response. The following conditions must be met in order for
vocational rehabilitation and community based rehabilitation providers
to meet the definition of corporate services provider
[[Page 11768]]
as prescribed under the provisions of this rule: (1) that the corporate
entity be approved for Medicare payment, or when Medicare approval
status is not required, be accredited by a qualified accreditation
organization, as defined in 32 CFR 199.2; (2) that the services are
covered program benefits rendered by CHAMPUS authorized individual
providers as designated in 32 CFR 199.6 the corporate entity has
entered into a participation agreement that at least complies with the
minimum participation agreement requirements set forth in this final
rule.
Comment 7. One commentor had concerns regarding the potential cost
impact of provider expansion on the CHAMPUS program.
Response. Currently professional outpatient health care which could
be supplied by corporate services providers (e.g., home health agencies
and comprehensive outpatient rehabilitation facilities) is obtained
through hospitals. CHAMPUS reimburses professional outpatient hospital
services as billed if a specific procedure code is not identifiable on
the institutional billing form. The same services received from
corporate services providers are always paid under the CHAMPUS Maximum
Allowable Charge (CMAC) reimbursement methodology. Under CMAC
reimbursement is limited to the billed charge or CHAMPUS-determined
allowable amount (in most cases the CMAC), whichever is less. The CMAC
is generally less than the billed charge; therefore, with the addition
of the proposed types of providers, CHAMPUS could potentially pay less
for professional health services. At worst, the impact would be budget
neutral, given the fact that professional services are paid in
accordance with the CHAMPUS Maximum Allowable Charge regardless of
whether the provider is authorized under the CHAMPUS regulatory
definition for individual professional provider or under the corporate
services provider class.
Comment 8. One commentor recommended that CHAMPUS recognize the
Commission on Accreditation of Rehabilitation Facilities (CARF)
accreditation for corporate services providers, since it is a
nationally recognized accrediting body for inpatient, outpatient,
vocational, behavioral, community based rehabilitation services and
programs.
Response. Under the provisions promulgated in this rule, a
corporate entity must maintain Medicare approval for payment if it is a
category or type of provider that is substantially comparable to a
provider or supplier for which Medicare has regulatory conditions of
participation or coverage. However, if regulatory provisions for
participation in the Medicare program are not available for a
particular category of provider, accreditation by a qualified
accreditation organization may be used in lieu of Medicare for
conveying CHAMPUS provider authorization status. Recognition of the
Commission on Accreditation of Rehabilitation Facilities (CARF) for
accreditation of corporate services providers as a condition of
authorization under CHAMPUS is contingent on its compliance with the
qualifying criteria established under the definition of ``Qualified
accreditation organization'' appearing in 32 CFR 199.2. In other words,
if Medicare certifies a particular corporate services provider class,
the providers' Medicare certification (approval for payment) must be
used as a condition for authorization under CHAMPUS. If not, the
accreditation of an accrediting organization that meets the qualifying
criteria under the definition of ``Qualified accreditation
organization'' appearing in 32 CFR 100.2 will have to be used.
Comment 9. A final commentor wanted to know if a CORF that was also
a professional corporation or professional association would be
eligible as an authorized corporate services provider.
Response. One of the conditions of authorization under the new
provider class designation (i.e., to be authorized under CHAMPUS as a
corporate services provider) is that the applicant be a freestanding
corporation or foundation, but not a professional corporation or
professional association.
IV. Regulatory Matters
Executive Order 12866 requires certain regulatory assessments for
any ``significant regularly action'' defined as one that would result
in an annual effect on the economy of $100 million or more, or have
other substantial impacts.
The Regulatory Flexibility Act (RFA) requires that each Federal
agency prepare, and make available for public comment are regulatory
flexibility analysis when the agency issues a regulation which would
have a significant impact on a substantial number of small entities.
Approximately 850 corporate or foundation physician groups and
4,500 freestanding Medicare certified in-home health care agencies will
become eligible to apply for CHAMPUS provider status on the effective
date of this rule. Since these changes are simply a competitive
redistribution of ambulatory care benefit costs for already existing
benefits, we certify that this final rule is not a major under
Executive Order 12866, and will not have a significant economic impact
on a substantial number of small entities under the criteria set forth
in the Regulatory Flexibility Act.
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-2511) requires all
Departments to submit to the Office of Management and Budget (OMB) for
review and approval any reporting or record keeping requirements in a
proposed or final rule. The final rule will require information from
the provider applicant to document that the criteria for CHAMPUS-
provider status are met. The development of a corporate services
provider application form has been accomplished along with an
accompanying participation agreement. A notice for the proposed
information collection appeared in the Federal Register on July 31,
1998 (63 FR 40882). The proposed information collection will be
submitted to OMB concurrently with the publication of the final rule in
the Federal Register.
Comments on these requirements should be submitted to the Office of
Information and Regulatory Affairs, OMB, 725 17th Street, N.W.,
Washington, DC 20503, marked ``Attention Desk Officer for Department of
Defense, Health Affairs.''
List of Subjects in 32 CFR Part 199
Claims, Health insurance, Individuals and disabilities, Military
personnel, Reporting and recordkeeping requirements.
Accordingly, 32 CFR part 199 is amended as follows:
PART 199--[AMENDED]
1. The authority citation for part 199 continues to read as
follows:
Authority: 5 U.S.C. 301; 10 U.S.C. chapter 55.
2. Section 199.2(b) is amended by revising the definition for
``Participating provider,'' and by adding definitions for ``Corporate
services provider,'' ``Economic interest,'' and ``Qualified
accreditation organization '' in alphabetical order to read as follows:
Sec. 199.2 Definitions.
* * * * *
(b) * * *
Corporate services provider. A health care provider that meets the
applicable requirements established by Sec. 199.6(f).
* * * * *
Economic interest. (1) Any right, title, or share in the income,
remuneration, payment, or profit of a CHAMPUS-authorized provider, or
of an individual
[[Page 11769]]
or entity eligible to be a CHAMPUS-authorized provider, resulting,
directly or indirectly, from a referral relationship; or any direct or
indirect ownership, right, title, or share, including a mortgage, deed
of trust, note, or other obligation secured (in whole or in part) by
one entity for another entity in a referral or accreditation
relationship, which is equal to or exceeds 5 percent of the total
property and assets of the other entity.
(2) A referral relationship exists when a CHAMPUS beneficiary is
sent, directed, assigned or influenced to use a specific CHAMPUS-
authorized provider, or a specific individual or entity eligible to be
a CHAMPUS-authorized provider.
(3) An accreditation relationship exists when a CHAMPUS-authorized
accreditation organization evaluates for accreditation an entity that
is an applicant for, or recipient of CHAMPUS-authorized provider
status.
* * * * *
Participating provider. A CHAMPUS-authorized provider that is
required, or has agreed by entering into a CHAMPUS participation
agreement or by act of indicating ``accept assignment'' on the claim
form, to accept the CHAMPUS-allowable amount as the maximum total
charge for a service or item rendered to a CHAMPUS beneficiary, whether
the amount is paid for fully by CHAMPUS or requires cost-sharing by the
CHAMPUS beneficiary.
* * * * *
Qualified accreditation organization. A not-for-profit corporation
or a foundation that:
(1) Develops process standards and outcome standards for health
care delivery programs, or knowledge standards and skill standards for
health care professional certification testing, using experts both from
within and outside of the health care program area or individual
specialty to which the standards are to be applied;
(2) Creates measurable criteria that demonstrate compliance with
each standard;
(3) Publishes the organization's standards, criteria and evaluation
processes so that they are available to the general public;
(4) Performs on-site evaluations of health care delivery programs,
or provides testing of individuals, to measure the extent of compliance
with each standard;
(5) Provides on-site evaluation or individual testing on a national
or international basis;
(6) Provides to evaluated programs and tested individuals time-
limited written certification of compliance with the organization's
standards;
(7) Excludes certification of any program operated by an
organization which has an economic interest, as defined in this
section, in the accreditation organization or in which the
accreditation organization has an economic interest;
(8) Publishes promptly the certification outcomes of each program
evaluation or individual test so that it is available to the general
public; and
(9) Has been found by the Director, OCHAMPUS, or designee, to apply
standards, criteria, and certification processes which reinforce
CHAMPUS provider authorization requirements and promote efficient
delivery of CHAMPUS benefits.
* * * * *
Sec. 199.4 [Amended]
3. Section 199.4 is amended by removing and reserving paragraphs
(g)(70) and (g)(71).
4. Section 199.6 is amended by revising paragraphs (a)(8), (c)(1),
and (c)(2); adding paragraphs (a)(12) and (a)(13); removing paragraph
(b)(1)(iii); redesignating paragraphs (f) and (g) as paragraphs (a)(14)
and (a)(15); and adding new paragraph (f) to read as follows:
Sec. 199.6 Authorized providers.
(a) * * *
(8) Participating providers. A CHAMPUS-authorized provider is a
participating provider, as defined in Sec. 199.2 under the following
circumstances:
(i) Mandatory participation. (A) All Medicare-participating
hospitals must be CHAMPUS participating providers for all inpatient
CHAMPUS claims.
(B) Hospitals that are not Medicare-participating but are subject
to the CHAMPUS-DRG-based payment methodology or the CHAMPUS mental
health payment methodology as established by Sec. 199.14(a), must enter
into a participation agreement with CHAMPUS for all inpatient claims in
order to be a CHAMPUS-authorized provider.
(C) Corporate services providers authorized as CHAMPUS providers
under the provisions of paragraph (f) of this section must enter into a
participation agreement as provided by the Director, OCHAMPUS, or
designee.
(ii) Voluntary participation--(A) Total claims participation: The
participating provider program. A CHAMPUS-authorized provider that is
not required to participate by this part may become a participating
provider by entering into an agreement or memorandum of understanding
(MOU) with the Director, OCHAMPUS, or designee, which includes, but is
not limited to, the provisions of paragraph (a)(13) of this section.
The Director, OCHAMPUS, or designee, may include in a participating
provider agreement/MOU provisions that establish between CHAMPUS and a
class, category, type, or specific provider, uniform procedures and
conditions which encourage provider participation while improving
beneficiary access to benefits and contributing to CHAMPUS efficiency.
Such provisions shall be otherwise allowed by this part or by DoD
Directive or DoD Instruction specifically pertaining to CHAMPUS claims
participation. Participating provider program provisions may be
incorporated into an agreement/MOU to establish a specific CHAMPUS-
provider relationship, such as a preferred provider arrangement.
(B) Claim-specific participation. A CHAMPUS-authorized provider
that is not required to participate and that has not entered into a
participation agreement pursuant to paragraph (a)(8)(ii)(A) of this
section may elect to be a participating provider on a claim-by-claim
basis by indicating ``accept assignment'' on each claim form for which
participation is elected.
* * * * *
(12) Medical records. CHAMPUS-authorized provider organizations and
individuals providing clinical services shall maintain adequate
clinical records to substantiate that specific care was actually
furnished, was medically necessary, and appropriate, and identify(ies)
the individual(s) who provided the care. This applies whether the care
is inpatient or outpatient. The minimum requirements for medical record
documentation are set forth by all of the following:
(i) The cognizant state licensing authority;
(ii) The Joint Commission on Accreditation of Healthcare
Organizations, or the appropriate Qualified Accreditation Organization
as defined in Sec. 199.2;
(iii) Standards of practice established by national medical
organizations; and
(iv) This part.
(13) Participation agreements. A participation agreement otherwise
required by this part shall include, in part, all of the following
provisions requiring that the provider shall:
(i) Not charge a beneficiary for the following:
(A) Services for which the provider is entitled to payment from
CHAMPUS;
(B) Services for which the beneficiary would be entitled to have
CHAMPUS
[[Page 11770]]
payment made had the provider complied with certain procedural
requirements.
(C) Services not medically necessary and appropriate for the
clinical management of the presenting illness, injury, disorder or
maternity;
(D) Services for which a beneficiary would be entitled to payment
but for a reduction or denial in payment as a result of quality review;
and
(E) Services rendered during a period in which the provider was not
in compliance with one or more conditions of authorization;
(ii) Comply with the applicable provisions of this part and related
CHAMPUS administrative policy;
(iii) Accept the CHAMPUS determined allowable payment combined with
the cost-share, deductible, and other health insurance amounts payable
by, or on behalf of, the beneficiary, as full payment for CHAMPUS
allowed services;
(iv) Collect from the CHAMPUS beneficiary those amounts that the
beneficiary has a liability to pay for the CHAMPUS deductible and cost-
share;
(v) Permit access by the Director, OCHAMPUS, or designee, to the
clinical record of any CHAMPUS beneficiary, to the financial and
organizational records of the provider, and to reports of evaluations
and inspections conducted by state, private agencies or organizations;
(vi) Provide the Director, OCHAMPUS, or designee, prompt written
notification of the provider's employment of an individual who, at any
time during the twelve months preceding such employment, was employed
in a managerial, accounting, auditing, or similar capacity by an agency
or organization which is responsible, directly or indirectly for
decisions regarding Department of Defense payments to the provider;
(vii) Cooperate fully with a designated utilization and clinical
quality management organization which has a contract with the
Department of Defense for the geographic area in which the provider
renders services;
(viii) Obtain written authorization before rendering designated
services or items for which CHAMPUS cost-share may be expected;
(ix) Maintain clinical and other records related to individuals for
whom CHAMPUS payment was made for services rendered by the provider, or
otherwise under arrangement, for a period of 60 months from the date of
service;
(x) Maintain contemporaneous clinical records that substantiate the
clinical rationale for each course of treatment, periodic evaluation of
the efficacy of treatment, and the outcome at completion or
discontinuation of treatment;
(xi) Refer CHAMPUS beneficiaries only to providers with which the
referring provider does not have an economic interest, as defined in
Sec. 199.2; and
(xii) Limit services furnished under arrangement to those for which
receipt of payment by the CHAMPUS authorized provider discharges the
payment liability of the beneficiary.
* * * * *
(c) Individual professional providers of care--(1) General--(i)
Purpose. This individual professional provider class is established to
accommodate individuals who are recognized by 10 U.S.C. 1079(a) as
authorized to assess or diagnose illness, injury, or bodily malfunction
as a prerequisite for CHAMPUS cost-share of otherwise allowable related
preventive or treatment services or supplies, and to accommodate such
other qualified individuals who the Director, OCHAMPUS, or designee,
may authorize to render otherwise allowable services essential to the
efficient implementation of a plan-of-care established and managed by a
10 U.S.C. 1079(a) authorized professional.
(ii) Professional corporation affiliation or association membership
permitted. Paragraph (c) of this section applies to those individual
health care professionals who have formed a professional corporation or
association pursuant to applicable state laws. Such a professional
corporation or association may file claims on behalf of a CHAMPUS-
authorized individual professional provider and be the payee for any
payment resulting from such claims when the CHAMPUS-authorized
individual certifies to the Director, OCHAMPUS, or designee, in writing
that the professional corporation or association is acting on the
authorized individual's behalf.
(iii) Scope of practice limitation. For CHAMPUS cost-sharing to be
authorized, otherwise allowable services provided by a CHAMPUS-
authorized individual professional provider shall be within the scope
of the individual's license as regulated by the applicable state
practice act of the state where the individual rendered the service to
the CHAMPUS beneficiary or shall be within the scope of the test which
was the basis for the individual's qualifying certification.
(iv) Employee status exclusion. An individual employed directly, or
indirectly by contract, by an individual or entity to render
professional services otherwise allowable by this part is excluded from
provider status as established by this paragraph (c) for the duration
of each employment.
(v) Training status exclusion. Individual health care professionals
who are allowed to render health care services only under direct and
ongoing supervision as training to be credited towards earning a
clinical academic degree or other clinical credential required for the
individual to practice independently are excluded from provider status
as established by this paragraph (c) for the duration of such training.
(2) Conditions of authorization--(i) Professional license
requirement. The individual must be currently licensed to render
professional health care services in each state in which the individual
renders services to CHAMPUS beneficiaries. Such license is required
when a specific state provides, but does not require, license for a
specific category of individual professional provider. The license must
be at full clinical practice level to meet this requirement. A
temporary license at the full clinical practice level is acceptable.
(ii) Professional certification requirement. When a state does not
license a specific category of individual professional, certification
by a Qualified Accreditation Organization, as defined in Sec. 199.2, is
required. Certification must be at full clinical practice level. A
temporary certification at the full clinical practice level is
acceptable.
(iii) Education, training and experience requirement. The Director,
OCHAMPUS, or designee, may establish for each category or type of
provider allowed by this paragraph (c) specific education, training,
and experience requirements as necessary to promote the delivery of
services by fully qualified individuals.
(iv) Physician referral and supervision. When physician referral
and supervision is a prerequisite for CHAMPUS cost-sharing of the
services of a provider authorized under this paragraph (c), such
referral and supervision means that the physicians must actually see
the patient to evaluate and diagnose the condition to be treated prior
to referring the beneficiary to another provider and that the referring
physician provides ongoing oversight of the course of referral related
treatment throughout the period during which the beneficiary is being
treated in response to the referral. Written contemporaneous
documentation of the referring physician's basis for referral and
ongoing communication between the referring and treating provider
regarding the oversight of the treatment
[[Page 11771]]
rendered as a result of the referral must meet all requirements for
medical records established by this part. Referring physician
supervision does not require physical location on the premises of the
treating provider or at the site of treatment.
* * * * *
(f) Corporate services providers.--(1) General. (i) This corporate
services provider class is established to accommodate individuals who
would meet the criteria for status as a CHAMPUS authorized individual
professional provider as established by paragraph (c) of this section
but for the fact that they are employed directly or contractually by a
corporation or foundation that provides principally professional
services which are within the scope of the CHAMPUS benefit.
(ii) Payment for otherwise allowable services may be made to a
CHAMPUS-authorized corporate services provider subject to the
applicable requirements, exclusions and limitations of this part.
(iii) The Director, OCHAMPUS, or designee, may create discrete
types within any allowable category of provider established by this
paragraph (f) to improve the efficiency of CHAMPUS management.
(iv) The Director, OCHAMPUS, or designee, may require, as a
condition of authorization, that a specific category or type of
provider established by this paragraph (f):
(A) Maintain certain accreditation in addition to or in lieu of the
requirement of paragraph (f)(2)(v) of this section;
(B) Cooperate fully with a designated utilization and clinical
quality management organization which has a contract with the
Department of Defense for the geographic area in which the provider
does business;
(C) Render services for which direct or indirect payment is
expected to be made by CHAMPUS only after obtaining CHAMPUS written
authorization; and
(D) Maintain Medicare approval for payment when the Director,
OCHAMPUS, or designee, determines that a category, or type, of provider
established by this paragraph (f) is substantially comparable to a
provider or supplier for which Medicare has regulatory conditions of
participation or conditions of coverage.
(v) Otherwise allowable services may be rendered at the authorized
corporate services provider's place of business, or in the
beneficiary's home under such circumstances as the Director, OCHAMPUS,
or designee, determines to be necessary for the efficient delivery of
such in-home services.
(vi) The Director, OCHAMPUS, or designee, may limit the term of a
participation agreement for any category or type of provider
established by this paragraph (f).
(vii) Corporate services providers shall be assigned to only one of
the following allowable categories based upon the predominate type of
procedure rendered by the organization;
(A) Medical treatment procedures;
(B) Surgical treatment procedures;
(C) Maternity management procedures;
(D) Rehabilitation and/or habilitation procedures; or
(E) Diagnostic technical procedures.
(viii) The Director, OCHAMPUS, or designee, shall determine the
appropriate procedural category of a qualified organization and may
change the category based upon the provider's CHAMPUS claim
characteristics. The category determination of the Director, OCHAMPUS,
designee, is conclusive and may not be appealed.
(2) Conditions of authorization. An applicant must meet the
following conditions to be eligible for authorization as a CHAMPUS
corporate services provider:
(i) Be a corporation or a foundation, but not a professional
corporation or professional association; and
(ii) Be institution-affiliated or freestanding as defined in
Sec. 199.2; and
(iii) Provide:
(A) Services and related supplies of a type rendered by CHAMPUS
individual professional providers or diagnostic technical services and
related supplies of a type which requires direct patient contact and a
technologist who is licensed by the state in which the procedure is
rendered or who is certified by a Qualified Accreditation Organization
as defined in Sec. 199.2; and
(B) A level of care which does not necessitate that the beneficiary
be provided with on-site sleeping accommodations and food in
conjunction with the delivery of services; and
(iv) Complies with all applicable organizational and individual
licensing or certification requirements that are extant in the state,
county, municipality, or other political jurisdiction in which the
provider renders services; and
(v) Be approved for Medicare payment when determined to be
substantially comparable under the provisions of paragraph
(f)(1)(iv)(D) of this section or, when Medicare approved status is not
required, be accredited by a qualified accreditation organization, as
defined in Sec. 199.2; and
(vi) Has entered into a participation agreement approved by the
Director, OCHAMPUS, or designee, which at least complies with the
minimum participation agreement requirements of this section.
(3) Transfer of participation agreement. In order to provide
continuity of care for beneficiaries when there is a change of provider
ownership, the provider agreement is automatically assigned to the new
owner, subject to all the terms and conditions under which the original
agreement was made.
(i) The merger of the provider corporation or foundation into
another corporation or foundation, or the consolidation of two or more
corporations or foundations resulting in the creation of a new
corporation or foundation, constitutes a change of ownership.
(ii) Transfer of corporate stock or the merger of another
corporation or foundation into the provider corporation or foundation
does not constitute change of ownership.
(iii) The surviving corporation or foundation shall notify the
Director, OCHAMPUS, or designee, in writing of the change of ownership
promptly after the effective date of the transfer or change in
ownership.
(4) Pricing and payment methodology: The pricing and payment of
procedures rendered by a provider authorized under this paragraph (f)
shall be limited to those methods for pricing and payment allowed by
this part which the Director, OCHAMPUS, or designee, determines
contribute to the efficient management of CHAMPUS.
(5) Termination of participation agreement. A provider may
terminate a participation agreement upon 45 days written notice to the
Director, OCHAMPUS, or designee, and to the public.
Dated: February 26, 1999.
L.M. Bynum,
Alternate OSD Federal Register Liaison, Officer, Department of Defense.
[FR Doc. 99-5528 Filed 3-9-99; 8:45 am]
BILLING CODE 5000-04-M
