02-8586. TRICARE; Civilian Health and Medical Program of the Uniformed Services (CHAMPUS); Bonus Payments in Medically Underserved Areas

AGENCY:

Office of the Secretary, DoD.

ACTION:

Final rule.

SUMMARY:

This final rule implements a bonus payment, in addition to the amount normally paid under the allowable charge methodology, to physicians in medically underserved areas. For purposes of this rule, medically underserved areas are the same as those determined by the Secretary of Health and Human Services for the Medicare program. Such bonus payments shall be equal to the bonus payments authorized by Medicare, except as necessary to recognize any unique or distinct characteristics or requirements of the TRICARE program, and as described in instructions issued by the Executive Director, TRICARE Management Activity. This rule promotes a reimbursement enhancement to a limited number of physicians designed to increase TRICARE beneficiary access to care.

EFFECTIVE DATE:

This rule is effective August 2, 2000.

ADDRESSES:

TRICARE Management Activity, Medical Benefits and Reimbursement Systems, 16401 East Centretech Parkway, Aurora, CO 80011-9043.

FOR FURTHER INFORMATION CONTACT:

Stan Regensberg, Medical benefits and Reimbursement Systems, TRICARE Management Activity, telephone [phone].

SUPPLEMENTARY INFORMATION:

I. Final Rule Provisions

A. Overview

This final rule implements a bonus payment, in addition to the amount normally paid under the allowable charge methodology, to physicians in medically underserved areas. This action is undertaken under authority of Title 10, United States Code Chapter 55, section 1079, Paragraph (h)(1). For purposes of this rule, medically underserved areas are the same as those determined by the Secretary of Health and Human Services for the Medicare program, as described below. Such bonus payments shall be equal to the bonus payments authorized by Medicare, except as necessary to recognize any unique or distinct characteristics or requirements of the TRICARE program, and as described in instructions issued by the Executive Director, TRICARE Management Activity. Bonus payments under Medicare are described below. If the Department of Health and Human Services acts to amend or remove the provision for bonus payments under Medicare, TRICARE likewise may follow Medicare in amendment or removing provision for such payments. Additionally, it provides a reimbursement enhancement that favors physicians in underserved areas, thus alleviating healthcare access problems experienced by beneficiaries residing in such areas. Finally, because Medicare previously established a bonus payment reimbursement mechanism in these areas, our emulation of this well established mechanism complies with existing statutory mandates that TRICARE follow Medicare reimbursement policy wherever practicable. This rule will not unilaterally increase payments to all physicians, but just those residing in these underserved areas. To do otherwise would prevent TRICARE Management Activity from fulfilling its duty to beneficiaries in these underserved areas.

B. Medicare Underserved Areas

For Medicare, “medically underserved areas” are those HPSAs (Health Professional Shortage Areas) designated by the Bureau of Primary Health Care (BPHC) within the Health Resources and Services Administration (HRSA). HRSA defines the areas through a set of criteria and publishes lists which have names of the areas (sometimes by county, sometimes by census tract, or other descriptive definitions). The HPSAs are areas considered to have a shortage of primary care physicians, but Medicare pays the bonus payment for all physician services in these geographic areas. Medicare carriers are responsible for determining the boundaries of the HPSAs and qualifying physicians within these areas. Areas are to have a shortage of primary care health physicians; many are rural but that is not a criterion for inclusion; poor inter-city geographic areas are often included.

C. Medicare Bonus Payments

The Medicare program pays physicians that provide services in medically underserved areas a bonus payment equal to ten percent of their Medicare payments, and the Medicare carriers calculate and pay these bonus payments quarterly by summing the amount of government payment from claims with a special modifier (QB or QU) which indicates that the service was provided in such an area (i.e., this is not an increase in the allowed amount nor does it produce a special fee schedule for this type of servicer, it is simply a bonus payment). The Medicare bonus payment is based on § 1833(b) of the Social Security Act.

II. Public Comments

A 60-day comment period was provided on the interim final rule. Comments were received from only two parties. Both the American Psychiatric Association and the Veterans Health Administration comments concerned the process that would be used to implement the bonus payment reimbursement system. The process that shall be used will pay physicians that provide services in health professional shortage areas the same additional payment that Medicare would pay in these areas. TRICARE contractors that administer and pay for physician services will inform physicians of the process that will be followed in order to receive the bonus payment from TRICARE. There was some confusion that occurred between the bonus payment provision and the proposed rule that was published in the Federal Register on May 20, 2000. The two publications are separate and distinct.

Regulatory Procedure

Executive Order 12866 requires certain regulatory assessments for any significant regulatory action, defined as one which 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, a regulatory flexibility analysis when the agency issues a regulation which would have a significant impact on a substantial number of small entities.

This rule has been designated as significant and has been reviewed by the Office of Management and Budget as required under the provisions of E.O. 12866.

The changes set forth in the final rule are minor revisions to the existing regulation. The final rule will not impose additional information collection requirements on the public under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3511).

List of Subjects in 32 CFR Part 199

• Claims
• Handicapped
• Health insurance
• Military personnel

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; and 10 U.S.C. Chapter 55.

2. Section 199.14 is amended by revising paragraph (h)(2) to read as follows:

§ 199.14

Provider reimbursement methods.

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(h) * * *

(2) Bonus payments in medically underserved areas. A bonus payment, in addition to the amount normally paid under the allowable charge methodology, may be made to physicians in medically underserved areas. For purposes of this paragraph, medically underserved areas are the same as those determined by the Secretary of Health and Human Services for the Medicare program. Such bonus payments shall be equal to the bonus payments authorized by Medicare, except as necessary to recognize any unique or distinct characteristics or requirements of the TRICARE program, and as described in instructions issued by the Executive Director, TRICARE Management Activity. If the Department of Health and Human Services acts to amend or remove the provision for bonus payments under Medicare, TRICARE likewise may follow Medicare in amending or removing provision for such payments.

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Dated: April 14, 2002.

L.M. Bynum,

Alternate OSD Federal Register Liaison Officer, Department of Defense.