[Federal Register Volume 61, Number 189 (Friday, September 27, 1996)]
[Rules and Regulations]
[Page 50689]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-24831]
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Rules and Regulations
Federal Register
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Federal Register / Vol. 61, No. 189 / Friday, September 27, 1996 /
Rules and Regulations
[[Page 50689]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 890
RIN 3206-AG31
Federal Employees Health Benefits Program: Limitation on
Physician Charges and FEHB Program Payments
AGENCY: Office of Personnel Management.
ACTION: Final rule.
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SUMMARY: The Office of Personnel Management (OPM) is making final its
interim regulation that amends current Federal Employees Health
Benefits (FEHB) Program regulations. The final regulation requires that
the charges and FEHB fee-for-service plans' benefit payments for
certain physician services furnished to retired enrolled individuals do
not exceed the limits on charges and payments established under the
Medicare fee schedule for physician services.
EFFECTIVE DATE: This final regulation is effective October 28, 1996.
FOR FURTHER INFORMATION CONTACT: Robert G. Iadicicco (202) 606-0004.
SUPPLEMENTARY INFORMATION: On May 18, 1995, OPM issued interim
regulations in the Federal Register [60 FR 26667] that amended part 890
to implement section 11003 of the Omnibus Budget Reconciliation Act
(OBRA) of 1993, Public Law 103-66, which was enacted on August 10,
1993. Section 11003 of OBRA of 1993 amended the FEHB law at 5 U.S.C.
8904(b) to limit the charges and FEHB fee-for-service plans' benefit
payments for certain physician services (as defined in section 1848(j)
of the Social Security Act) received by retired enrolled individuals.
We received three written comments from two FEHB fee-for-service
plans and one retiree organization. One FEHB plan wrote that the
interim regulation, though generally comprehensive, did not address
coverage situations in which the FEHB plan is secondary to another
group health plan. Since the limits on physician charges apply only to
FEHB plans, if retired enrolled individuals have primary coverage under
another group health plan, the primary plan cannot limit physician
charges to the applicable Medicare limits.
The plan stated that it has determined the plan's secondary benefit
payment under its coordination of benefits provision will not exceed
the Medicare limits on virtually all claims arising under this coverage
situation. Consequently, the plan believed that it will achieve time
and administrative expense savings, and avoid customer service
disputes, if the Medicare limits are not applied to these claims.
OBRA of 1993 was a deficit reduction measure, and the overriding
goal of its FEHB provision was to reduce the Program's costs. When FEHB
plans are secondary payers, it costs them more to apply the Medicare
limits than they save by applying the limits. We do not believe this is
the result intended by the law. Therefore, FEHB plans are not required
to apply the Medicare limits when paying the claims of retired enrolled
individuals who have primary coverage under another group health plan.
The plans must pay these claims under their coordination of benefits
provision.
Another FEHB plan noted that section 890.808 of the interim
regulation states that plans, under the oversight of OPM, will notify
the Department of Health and Human Services (HHS) of health care
providers who knowingly, willfully, and repeatedly violate the Medicare
limits. The plan requested that OPM provide the mailing address of a
contact at HHS to forward member complaints about providers who violate
the Medicare limits.
We agree that it is important to have a contact at HHS to whom FEHB
plans can report providers who are violating the Medicare limits. We
are working with HHS to select an appropriate contact. Once an HHS
contact is selected, we will notify the FEHB plans.
The retiree organization noted that the FEHB plans are crucial to
the success of the enforcement of the Medicare limits. The commenter
expressed concern that the plans do not have an adequate incentive to
vigorously pursue providers who overcharge retirees. In fact, the plans
have a powerful incentive to enforce the charge limits. If a plan fails
to protect its members from overcharges, the members will soon consider
choosing another plan that will protect them.
Regulatory Flexibility Act
I certify that these regulations will not have a significant
economic impact on a substantial number of small entities because they
primarily affect the health care coverage of Federal annuitants, their
spouses, and former spouses.
E.O. 12866, Regulatory Review
This rule has been reviewed by OMB in accordance with E.O. 12866.
List of Subjects in 5 CFR Part 890
Administrative practice and procedure, Government employees, Health
facilities, Health insurance, Health professions, Hostages, Iraq,
Kuwait, Lebanon, Reporting and recordkeeping requirements, Retirement.
U.S. Office of Personnel Management
James B. King,
Director.
Accordingly, under the authority of 5 U.S.C. 8913, OPM is adopting
its interim regulation under 5 CFR part 890 as published on May 18,
1995, [60 FR 26667], as a final rule without change.
[FR Doc. 96-24831 Filed 9-26-96; 8:45 am]
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