[Federal Register Volume 63, Number 42 (Wednesday, March 4, 1998)]
[Rules and Regulations]
[Pages 10730-10731]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-5655]
[[Page 10729]]
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Part VI
Department of Health and Human Services
_______________________________________________________________________
Health Care Financing Administration
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42 CFR Parts 441, 489 and Ch. IV
Medicare and Medicaid Programs: Surety Bond Requirements for Home
Health Agencies; Final Rule and Technical Revisions; Proposed Rule
Federal Register / Vol. 63, No. 42 / Wednesday, March 4, 1998 / Rules
and Regulations
[[Page 10730]]
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
42 CFR Parts 441 and 489
[HCFA-1152-F]
RIN 0938-AI31
Medicare and Medicaid Programs; Surety Bond Requirements for Home
Health Agencies
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Final rule.
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SUMMARY: The Balanced Budget Act of 1997 (BBA'97) requires each home
health agency (HHA), in order to participate in either the Medicare or
the Medicaid program, to secure a surety bond. On January 5, 1998, we
published a final rule with comment period that requires that each
Medicare-participating HHA obtain from an acceptable authorized Surety
a surety bond that is the greater of $50,000 or 15 percent of the
annual amount paid to the HHA by the Medicare program, as reflected in
the HHA's most recently accepted cost report. The rule also requires
that an HHA participating in Medicaid must furnish a surety bond in an
amount that is the greater of $50,000 or 15 percent of its Medicaid
revenues to the Medicaid State agency in each State in which it
operates. The rule also requires submittal of the initial bond to HCFA
or the State Medicaid agency, or both--as applicable--by February 27,
1998. Because some HHAs have not been able to obtain a surety bond in
time to meet the February 27 date, we are removing the date by which
HHAs are required to submit the bonds to HCFA and/or the State Medicaid
Agency.
EFFECTIVE DATE: This final rule is effective on March 4, 1998.
FOR FURTHER INFORMATION CONTACT: Ralph Goldberg, (410)786-4870
(Medicare Provisions). Mary Linda Morgan, (410)786-2011 (Medicaid
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 in
the Federal Register a final rule on January 5, 1998 (63 FR 292-355) to
implement the surety bond requirements. The comment period on that
final rule continues until March 6, 1998.
Generally, the rule requires each HHA participating in Medicare to
obtain from an acceptable 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 date for submittal of an initial surety bond
to HCFA and/or the State Medicaid agency is February 27, 1998.
II. Provisions of this Final Rule
Concerns about Surety liability issues have been raised by
representatives of the surety industry as well as by home health agency
representatives. We address these concerns in a notice published
elsewhere in this edition of the Federal Register. Those issues were
not apparent during our previous discussions with the representatives
prior to the publication of the final rule on January 5, 1998.
Therefore, because of resultant delays in the ability of some HHAs to
secure surety bonds in time to meet the February 27, 1998 date for
submittal to HCFA and/or the state Medicaid agency, we believe it is
now prudent to extend the February 27, 1998 effective date for HHAs to
furnish a bond. This final rule deletes the February 27, 1998 effective
date for all HHAs to furnish a surety bond. The new compliance date
will be 60 days after the date of publication of the final rule that
implements the technical changes discussed in the notice appearing
elsewhere in this edition of the Federal Register.
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 it incorporates a
statement of the finding and its reasons in the rule issued.
We find good cause to waive the notice-and-comment procedure with
respect to this rule because it is impracticable to employ notice and
comment procedures and issue a rule on or before the current effective
date for bond submission. We also find good cause to waive notice and
comment procedures with respect to this rule because employing such
procedures would, in this instance, be contrary to the public interest.
We believe that some reputable HHAs are unable to secure the surety
bond in time to meet the date currently specified in the regulations,
which could result in HHAs being unable to participate in Medicare or
Medicaid. Such a result could reduce significantly access to care by
program beneficiaries and that outcome would be contrary to the public
interest.
For these reasons, we find good cause to waive notice-and-comment
and to issue this final rule.
IV. Waiver of 30-Day Interim Period Before Rule is Effective
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, the 30-day interim period 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 and the agency publishes a brief
statement with the rule of its findings and the reason therefore.
We find good cause to make the provisions of this rule effective on
publication in the Federal Register. For the reasons discussed above in
section III. of this preamble, ``Waiver of Proposed Rulemaking,'' i.e.,
because we find it necessary to amend the requirement for the
submission of a surety bond to delay the effective date beyond February
27, 1998, it would be both impracticable and contrary to the public
interest to delay the effective date of this rule. Therefore, we find
good cause to waive the 30-day interim period for this rule. Therefore,
we have made the effective date the date of publication in the Federal
Register.
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:
[[Page 10731]]
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. Section 441.16(i)(1)(i) is revised to read as follows:
Sec. 441.16 Home health agency requirements for surety bonds;
Prohibition on FFP.
* * * * *
(i) Submission date and term of the bond.
(1) * * *
(i) Initial term: The term of the initial bond is from January 1,
1998 through a date specified by the State Medicaid agency.
* * * * *
PART 489--PROVIDER AGREEMENTS AND SUPPLIER APPROVAL
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. Section 489.67(a)(1) is revised to read as follows:
Sec. 489.67 Submission date and term of the bond.
(a) * * *
(1) Initial term: The term of the initial bond is from January 1,
1998 through the end of the HHA's 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 Program, and Program No.
93.778, Medical Assistance Program)
Dated: February 26, 1998.
Nancy-Ann Min DeParle,
Administrator, Health Care Financing Administration.
Dated: February 26, 1998.
Donna E. Shalala,
Secretary.
[FR Doc. 98-5655 Filed 2-27-98; 5:05 pm]
BILLING CODE 4120-01-P
