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Focus on Regulation

Rules Reducing Provider Burden Could Save Them More than $1.1 Billion

The Centers for Medicare & Medicaid Services (CMS) finalized two rules that together are expected to reduce costs for hospitals and other health care providers by over $1.1 billion.  The rules come in response to President Obama’s January 18 Executive Order 13563, which called upon agencies to review existing regulations and to “modify, streamline, expand, or repeal” those regulations that “may be outmoded, ineffective, insufficient, or excessively burdensome”.

The first rule, which CMS estimates will save hospitals as much as $900 million annually, modifies  the Conditions of Participation (CoPs) that hospitals and critical access hospitals must meet to participate in both Medicare and Medicaid.  Key revisions include:

  • Permitting one governing body to oversee multiple hospitals in a multi-hospital system, with the requirement that member(s) of the hospital’s medical staff be part of the body;
  • Expanding the definition of “medical staff”, and permitting hospitals to grant other practitioners hospital privileges;
  • Giving hospitals the discretion to have an optional program that would allow patients or a support person to administer certain medications; and
  • Removing the requirement that a single Director of Outpatient Services oversee all outpatient departments in a hospital.

The second rule is intended to improve efficiency in both the Medicare and Medicaid programs by removing unnecessary and burdensome requirements and either removing obsolete or duplicative regulations or providing clarifying information. Among other things, the rule:

  • Limits the applicability of the Life Safety Code to certain End Stage Renal Disease Facilities;
  • Eliminates the outdated list of emergency equipment that must be available in ambulatory surgical centers;
  • Removes an “unnecessarily punitive enrollment bar for providers and suppliers” when triggered by provider or supplier’s failure to respond in a timely manner to revalidation or other requests for information;
  • Removes obsolete pre-BIPA regulations that apply to initial determinations, re-openings and appeals of claims under original Medicare; and
  • Updates and streamlines definitions and regulations pertaining to Organ Procurement Organizations.