Close X
Attorney Spotlight

Find out how Gardner Bell's experience promoting financial and economic development initiatives both locally and abroad informs his role as an attorney. Find out more>

Search

Close X

Experience

Search our Experience

Experience Spotlight

On December 1, 2016, Parker Hannifin Corporation and CLARCOR Inc. announced that the companies have entered into a definitive agreement under which Parker will acquire CLARCOR for approximately $4.3 billion in cash, including the assumption of net debt. The transaction has been unanimously approved by the board of directors of each company. Upon closing of the transaction, expected to be completed by or during the first quarter of Parker’s fiscal year 2018, CLARCOR will be combined with Parker’s Filtration Group to form a leading and diverse global filtration business. Bass, Berry & Sims has served CLARCOR as primary corporate and securities counsel for 10 years and served as lead counsel on this transaction. Read more here.

CLARCOR
Close X

Thought Leadership

Enter your search terms in the relevant box(es) below to search for specific Thought Leadership.
To see a recent listing of Thought Leadership, click the blue Search button below.

Thought Leadership Spotlight

Securities Law Exchange BlogSecurities Law Exchange blog offers insight on the latest legal and regulatory developments affecting publicly traded companies. It focuses on a wide variety of topics including regulation and reporting updates, public company advisory topics, IPO readiness and exchange updates including IPO announcements, M&A trends and deal news.

Read More >

Untangling the Tape: Two CMS Final Rules Carry Out Executive Order for Simplification

Publications

May 25, 2012

On May 16, 2012, the Centers for Medicare and Medicaid Services ("CMS") published two final rules aimed at reducing the regulatory burden on providers.[1] In a previous edition of Health Law Update, we commented on certain provisions of the proposed versions of these rules.[2]  The final versions of the rules essentially adopt the proposed provisions on which we commented, except where noted.  The final rules reflect CMS' commitment to President Obama's January 1, 2011 Executive Order,[3] which called  on federal agencies to focus on streamlined, effective and efficient regulatory frameworks.  The new rules become effective July 16, 2012.

Hospital Conditions of Participation ("CoPs")

In this final rule, CMS revises the CoPs applicable to hospitals and critical access hospitals ("CAHs").  CMS estimates that the changes in this final rule will reduce the total regulatory burden for hospitals and CAHs by nearly $940 million initially and by almost $5 billion over the next five years.  The revisions include the following:

  • One Governing Body. CMS has revised the regulations to allow one governing body to oversee multiple hospitals in a multi-hospital system (CMS notes that permitting a single governing body for multiple hospitals in a system does not relieve each separately certified hospital from the obligation to separately demonstrate its compliance with all of the hospital CoPs.[4]  CMS also notes that it continues to interpret the CoPs to require that each hospital, regardless of whether it is a part of a multi-hospital system, have a single and separate medical staff.[5]  Thus, while there can be a single governing body for a multi-hospital system, there cannot be a single medical staff).
  • Medical Staff Representation on Governing Body.  All governing bodies, whether of a single hospital or a multi-hospital system, must include a member or members of the medical staff.
  • Reporting of Restraint-Related Deaths.  Hospitals will no longer need to report deaths that occur while a patient is only in soft, 2-point wrist restraints; rather, hospitals will need to maintain an internal log (or other system) of all such deaths. This log must be made available to CMS immediately upon request.
  • Non-physician Practitioners. CMS has broadened the concept of "medical staff" to allow hospitals the flexibility to include non-physician practitioners on their medical staff with hospital privileges to practice all functions within their scope of practice in accordance with state law.  Note that CMS abandoned the provision in the proposed version of the rules that would have specified that physicians and non-physician practitioners need not have medical staff membership at a hospital in order to be granted privileges at the hospital.       
  • Medical Staff Leadership. CMS has revised its regulations to allow podiatrists to assume a new medical staff leadership role within hospitals, if hospitals so choose.
  • Nursing Care Plan. CMS has given hospitals the option of having a stand-alone nursing care plan or a single interdisciplinary care plan that addresses nursing and other disciplines.
  • Self-administration of Medications. CMS has allowed hospitals the option of establishing a program for self-administration of appropriate medications by patients and/or their support person(s). The program must: address the safe and accurate administration of specified medications; ensure a process for medication security; address self-administration training and supervision; and document medication self-administration.
  • Administration of Blood Transfusions and Intravenous Medications.  CMS has removed the requirement for special training in administering blood transfusions and intravenous medications. Instead, non-physician personnel who administer blood transfusions and intravenous medications must adhere to state law and approved medical staff policies and procedures. CMS believes this change is consistent with current standards of practice.
  • Orders by Other Practitioners. CMS has revised the nursing services CoP to (i) allow drugs and biologicals to be prepared and administered on the orders of non-physician practitioners, and (ii) allow orders for drugs and biologicals to be documented and signed by non-physician practitioners, all in accordance with hospital policy and state law. 
  • Standing Orders. CMS has provided hospitals with the ability to use standing orders; however, the hospital’s medical staff, nursing, and pharmacy must approve written and electronic standing orders, order sets, and protocols. Any such standing orders and protocols must be based on nationally recognized and evidence-based guidelines and recommendations.
  • Verbal Orders. CMS has eliminated the requirement for authentication of verbal orders within 48-hours and, instead, defers to applicable state law to establish authentication timeframes.
  • Authentication of Orders. CMS has made permanent the previous temporary requirement that all orders, including verbal orders, must be dated, timed, and authenticated by either the ordering practitioner or another practitioner who is responsible for the care of the patient and who is authorized to write orders by hospital policy in accordance with state law.    
  • Infection Control Log. CMS has eliminated what it considers the obsolete requirement that a hospital maintain an infection control log since hospitals are already required to monitor infections through various surveillance methods including electronic systems.
  • Outpatient Services Director.  CMS has removed the requirement for a single Director of Outpatient Services to oversee all outpatient departments in a hospital given that hospitals already have separate directors for individual outpatient departments.  CMS has taken the view that a single overall Director position is duplicative and unnecessary.
  • Transplant Center Process Requirements. CMS has eliminated, as duplicative, a requirement for an organ recovery team working for the transplant center to conduct a "blood type and other vital data verification" before organ recovery when the recipient is known. CMS reinforced that the verification will continue to be completed at two other times during the transplant process.
  • CAH Provision of Services. CMS removed what it considered a burdensome requirement that CAHs must furnish diagnostic and therapeutic services, laboratory services, radiology services, and emergency procedures directly by CAH staff.  After this change, CAHs may provide such services under arrangement.
  • CAH Personnel Qualifications. CMS has revised the definition of "clinical nurse specialist" at 42 C.F.R. § 485.604(a) to reflect the definition in the Social Security Act § 1861(aa)(5)(b). 
  • CAH Surgical Services. CMS has also made a revision to the CoPs to clarify that "surgical services" are an optional service for CAHs.

Reducing Regulatory Burdens

In a second final rule, CMS reforms other Medicare and Medicaid regulations that it has identified as unnecessary, obsolete, or excessively burdensome on healthcare providers, suppliers and beneficiaries.[6]  Some of the changes include:

  • End-Stage Renal Disease ("ESRD") Facility Life Safety Requirements. CMS has limited mandatory compliance with the Life Safety Code to those ESRD facilities located adjacent to high hazardous occupancies. CMS has recognized that the standard requirements “may not be necessary given the non-residential and unique characteristics of ESRD facilities” in consideration of the increased burden without the commensurate benefit.[7]  CMS has also clarified that the sprinkler requirement in facilities housed in high rise buildings is intended to be applicable to buildings constructed after January 1, 2008.  CMS estimates this revision to result in a one-time savings to ESRD facilities of $108.7 million. 
  • Ambulatory Surgery Center ("ASC") Emergency Equipment.  CMS has removed the detailed list of emergency equipment that must be available in an ASC operating room because, in CMS’ view, some of it was outdated and some of it unnecessary in ASCs that perform only minor procedures. CMS estimates this change should result in a one-time savings of $18.5 million to ASCs. 
  • Re-enrollment Bar.  Historically, the failure to respond timely to a revalidation request (i.e., 60 days) or other requests for information resulted in a re-enrollment bar for  one to three years from the date of revocation.  As part of this final rule, CMS has revised 42 C.F.R. § 424.535(c) to remove application of the re-enrollment bar to providers and suppliers who fail to respond timely to revalidation or other requests for information. CMS recognized application of the re-enrollment bar "often results in unnecessarily harsh consequences" and comments about "numerous instances where the provider’s failure to respond to a revalidation request was unintentional," (i.e., not aware the request was due, misrouted mail, or clerical mistake). Despite commenter requests, CMS has indicated that the change will not be applied retroactively.
  • Medicare Billing Deactivation. CMS has also added new 42 C.F.R. § 424.540(a)(3) to allow CMS to "deactivate" rather than "revoke" the Medicare billing privileges of a provider or supplier that fails to furnish complete and accurate information and all supporting documentation within 90 calendar days of receiving notification to submit an enrollment application and supporting documentation or to resubmit and certify to the accuracy of its enrollment information. CMS points out that deactivation carries fewer ancillary consequences than revocation; for instance, a prior revocation has to be reported on the CMS-855I whereas a deactivation does not have to be reported.  CMS had also considered, in the proposed version of the rule, exempting individual practitioners from application of the rule that allows CMS to automatically deactivate Medicare Billing Privileges upon 12 consecutive months of inactivity[8] (i.e., no claims submitted within the previous 12 months).  However, in the final version of the rule, CMS has opted not to finalize that change based on program integrity concerns.[9]  Commenters raised various issues with allowing unused billing numbers to remain active and the potential for fraud, waste and abuse (e.g., identity theft).
  • Office of Management and Budget ("OMB") Control Numbers for Approved Collections of Information. CMS has removed the obsolete list of OMB control numbers, approval numbers, and information collections in the C.F.R. because the list is now displayed on the OMB public website.
  • Appeals of Part A and Part B Claims Determinations. CMS has removed obsolete pre-Benefits Improvement and Protection Act ("BIPA") regulations that apply to initial determinations, re-openings, and appeals of claims under original Medicare (i.e., 42 C.F.R. §§ 405.701-405.877). CMS indicates this will eliminate confusion by Medicare beneficiaries, providers, and suppliers regarding which appeals rights and procedures apply.
  • ASC Infection Control Program. CMS has removed what it considers "the obsolete requirement that an ASC must establish a program for identifying and preventing infections, maintaining a sanitary environment, and reporting the results to the appropriate authorities,"[10] because there is already a condition for coverage dedicated to infection control.
  • E-prescribing.  CMS retired older versions of e-prescribing transactions for Medicare Part D and adopted the newer versions to be in compliance with the current e-prescribing standards.
  • Physical and Occupational Therapist Qualifications. CMS removed outdated personnel qualifications in the current Medicaid regulations to instead refer to the updated Medicare regulations.
  • Organ Procurement Organizations ("OPOs") Definitions. CMS updated definitions related to organ procurement because the meaning of these definitions has changed over time.
  • OPOs Administration and Governing Body. CMS removed duplicate regulations; however, CMS did not alter or change the existing regulations related to the requirements that the OPO governing body must meet, such as, having full legal authority for the management of all OPO services.
  • Intermediate Care Facilities for Individuals who are Intellectually Disabled ("ICF/IID").  CMS replaced the requirement for time-limited agreements for ICFs/IID with a requirement for an open-ended agreement, which would remain in effect until the Health and Human Services Secretary or a state determines that the facility no longer meets the ICF/IID conditions of participation. CMS also added a requirement that a certified ICF/IID must be surveyed, on average, every 12 months with a maximum 15-month survey interval.

 

If you have any questions about this issue of Health Law Update, please contact any of the attorneys in our Healthcare Practice Group. 


[1] 77 Fed. Reg. 29002 (May 16, 2012); 77 Fed. Reg. 29034 (May 16, 2012).
[2] See "Making Things Simple (Or Simpler, At Any Rate)," November 10, 2011. 
[3] Executive Order 13563, Improving Regulation and Regulatory Review. (January 18, 2011).
[4] 77 Fed. Reg. at 29039.
[5] 77 Fed. Reg. at 29061.
[6] 77 Fed. Reg. 29002-29031 (May 16, 2012).
[7] 77 Fed. Reg. at 29004.
[8] 42 C.F.R. § 424.540(a)(1).
[9] 77 Fed. Reg. at 29010-29013
[10] 77 Fed. Reg. at 29002.


Related Services

Notice

Visiting, or interacting with, this website does not constitute an attorney-client relationship. Although we are always interested in hearing from visitors to our website, we cannot accept representation on a new matter from either existing clients or new clients until we know that we do not have a conflict of interest that would prevent us from doing so. Therefore, please do not send us any information about any new matter that may involve a potential legal representation until we have confirmed that a conflict of interest does not exist and we have expressly agreed in writing to the representation. Until there is such an agreement, we will not be deemed to have given you any advice, any information you send may not be deemed privileged and confidential, and we may be able to represent adverse parties.