[Federal Register: September 1, 2005 (Volume 70, Number 169)]
[Notices]
[Page 52105-52108]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01se05-79]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-1308-NC]
RIN 0938-AN94
Medicare Program; Withdrawal of Ambulance Fee Schedule Issued in
Accordance With Federal District Court Order in Lifestar Ambulance,
Inc. v. United States, No. 4:02-CV-127-1 (M.D. Ga., Jan. 16, 2003)--
Medicare Covered Ambulance Services
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice with comment period.
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SUMMARY: This notice with comment period withdraws the fee schedule
that was put in place in 2003 to effect compliance with the Order in
Lifestar Ambulance, Inc. v. United States. [211 F.R.D. 688 (M.D. Ga.
2003)] That Order was vacated on January 10, 2005 by the U.S. Court of
Appeals for the Eleventh Circuit and is no longer in force.
DATES: To be assured consideration, comments must be received at one of
the addresses provided below, no later than 5 p.m. on October 31, 2005.
ADDRESSES: In commenting, please refer to file code CMS-1308-NC.
Because of staff and resource limitations, we cannot accept comments by
facsimile (FAX) transmission.
You may submit comments in one of four ways (no duplicates,
please):
1. Electronically. You may submit electronic comments to http://www.cms.hhs.gov/regulations/ecomments or to http://www.regulations.gov
ions.gov
(attachments should be in Microsoft Word, WordPerfect, or Excel;
however, we prefer Microsoft Word).
2. By mail. You may mail written comments (one original and two
copies) to the following address ONLY: Centers for Medicare & Medicaid
Services, Department of Health and Human Services, Attention: CMS-1308-
NC, P.O. Box 8011, Baltimore, MD 21244-1850.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments (one
original and two copies) to the following address ONLY: Centers for
Medicare & Medicaid Services, Department of Health and Human Services,
Attention: CMS-1308-NC, Mail Stop C4-26-05, 7500 Security Boulevard,
Baltimore, MD 21244-1850.
[[Page 52106]]
4. By hand or courier. If you prefer, you may deliver (by hand or
courier) your written comments (one original and two copies) before the
close of the comment period to one of the following addresses. If you
intend to deliver your comments to the Baltimore address, please call
telephone number (410) 786-7197 in advance to schedule your arrival
with one of our staff members.
Room 445-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW.,
Washington, DC 20201; or
7500 Security Boulevard, Baltimore, MD 21244-1850.
(Because access to the interior of the Humphrey Building is not
readily available to persons without Federal Government identification,
commenters are encouraged to leave their comments in the CMS drop slots
located in the main lobby of the building. A stamp-in clock is
available for persons wishing to retain a proof of filing by stamping
in and retaining an extra copy of the comments being filed.)
Comments mailed to the addresses indicated as appropriate for hand
or courier delivery may be delayed and received after the comment
period.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
EFFECTIVE DATE: This notice is effective on September 1, 2005.
FOR FURTHER INFORMATION CONTACT: Anne Tayloe, (410) 786-4546.
SUPPLEMENTARY INFORMATION: Submitting Comments: We welcome comments
from the public on all issues set forth in this rule to assist us in
fully considering issues and developing policies. You can assist us by
referencing the file code CMS-1308-NC and the specific ``issue
identifier'' that precedes the section on which you choose to comment.
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. CMS posts all electronic
comments received before the close of the comment period on its public
Web site as soon as possible after they have been received. Hard copy
comments received timely will be available for public inspection as
they are received, generally beginning approximately 3 weeks after
publication of a document, at the headquarters of the Centers for
Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore,
Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4
p.m. To schedule an appointment to view public comments, phone 1-800-
743-3951.
I. Background
[If you choose to comment on issues in this section, please include
the caption ``BACKGROUND'' at the beginning of your comments.]
Section 4531 of the Balanced Budget Act of 1997 (BBA) required the
Secretary of the Department of Health and Human Services (HHS) (the
Secretary) to establish a national fee schedule (FS) for payment of
ambulance services through a negotiated rulemaking process. The statute
provides that the Secretary phase in the application of payment rates
under the FS in a fair and efficient manner and that the aggregate
amount of payment for the services under the new FS not exceed the
amount that would be paid under the old system as stated in section
1834(l) of the Social Security Act (the Act). The BBA provided that the
FS would apply to services furnished on or after January 1, 2000.
The proposed and final FS rules both provided for payment for
ambulance services to be made in two parts: (1) A base rate; and (2) a
payment for mileage. Section 423 of the Medicare, Medicaid and SCHIP
Benefits Improvement and Protection Act of 2000 (BIPA), which was
passed after the publication of the proposed FS rule and prior to the
publication of the final rule, provided that during the phase-in of the
FS there would be full payment of any national mileage rate for
ambulance services furnished by suppliers in States where the Medicare
carrier did not previously pay separately for all mileage within the
county from which the beneficiary is transported (``BIPA mileage
provision''). Two States were identified as qualifying under this
provision: North Carolina (NC) and Tennessee (TN). BIPA specifies that
this provision applies to services furnished on or after July 1, 2001.
This FS was implemented on April 1, 2002 by a final rule published
in the Federal Register on February 27, 2002 (67 FR 9100). As stated in
the final rule, the phase-in is accomplished over five years by
blending a percentage of the payment that is based on the old payment
system with a percentage of the payment based on the FS according to
the following schedule:
------------------------------------------------------------------------
Year Old (percent) FS (percent)
------------------------------------------------------------------------
4/1/2002-12/31/2002 80 20
2003 60 40
2004 40 60
2005 20 80
2006 0 100
------------------------------------------------------------------------
The full national FS mileage rate in those States that qualify for
BIPA provision section 423 (NC, TN) was paid as of April 1, 2002.
In Lifestar Ambulance Service, Inc. v. United States, 211 F.R.D.
688 (M.D. Ga. 2003), three ambulance suppliers seeking to represent a
nationwide class of ambulance suppliers sued the Secretary, arguing
that he had no discretion to give the FS an effective date other than
January 1, 2000. The district court agreed with the plaintiff suppliers
and issued an order certifying a nationwide class of ambulance
suppliers and requiring the Secretary to adopt a FS for the January 1,
2000, through March 31, 2002 period. The court's decision also required
the Secretary to pay full mileage under the BIPA provision for the July
1, 2001 through March 31, 2002 period.
On April 16, 2003, the Secretary issued a notice in compliance with
the district court's order. (68 FR 18654) The Secretary established a
FS based on the FS as described in the Federal Register (67 FR 9100),
with a modified phase-in as follows:
------------------------------------------------------------------------
Year Old (percent) FS (percent)
------------------------------------------------------------------------
2000 95 5
2001 90 10
1/1/2002-3/31/2002 80 20
------------------------------------------------------------------------
Additionally, under the district court's order, the notice stated
that the Medicare program would pay full BIPA mileage for services
provided on or after July 1, 2001. The notice stated that the Secretary
had appealed the decision in Lifestar and that any FS or BIPA mileage
payment made under the notice for the January 1, 2000 through March 31,
2002 period would be subject to recoupment if the district court's
decision was reversed on appeal. The Secretary has not made any
payments under this FS. In addition, we are not aware of any ambulance
suppliers seeking payment under this FS prior to the Eleventh Circuit's
reversal of the district court decision, although some were seeking
full mileage under the BIPA mileage provision.
On appeal, the Eleventh Circuit found that the district court had
lacked jurisdiction over the case because the plaintiffs had not gone
through the administrative process before filing suit. See Lifestar
Ambulance Service, Inc. v.
[[Page 52107]]
United States, 365 F.3d 1293 (11th Cir. 2004), cert. denied, -US-, 125
S.Ct. 866 (Jan 10, 2005). It reversed and vacated the district court
decision and remanded the case with instructions to dismiss for lack of
subject-matter jurisdiction. Plaintiffs unsuccessfully sought rehearing
en banc and Supreme Court review. The district court dismissed the
complaint in accordance with the Eleventh Circuit's mandate on February
2, 2005.
II. Provisions of the Notice With Comment Period
[If you choose to comment on issues in this section, please include
the caption ``PROVISIONS'' at the beginning of your comments.]
The purpose of this notice is to withdraw the FS covering the
period of January 1, 2000 through March 31, 2002 that was published in
the April 16, 2003 notice. As we stated explicitly in the April 16,
2003 notice, we only issued this ambulance fee schedule to comply with
the Lifestar district court order and that order was vacated and the
Lifestar case dismissed. Although the April 16, 2003 notice clearly
states that payment under the FS for the January 1, 2000 through March
31, 2002 period is dependent on the district court opinion not being
reversed by the Eleventh Circuit Court of Appeals, refraining from
formally withdrawing the FS for this period could create unnecessary
confusion.
In light of our inability to issue a fee schedule by January 1,
2000, we continue to believe that giving the fee schedule prospective
application clearly meets the intent of the Congress. The Congress made
no indication that it wanted us to apply the base rate or the mileage
provisions of the FS retroactively in the event that we were unable to
issue the final FS by January 1, 2000. Also, given ample opportunity,
the Congress did not provide specific direction regarding this issue
after the January 1, 2000 date passed. The Congress itself took no
further action on the issue (such as directing the implementation of
its own version of an ambulance fee schedule).
Furthermore, the BBA directed the Secretary to phase in the
application of the payment rates under the fee schedule in an efficient
and fair manner and required that payments under the schedule in the
year 2000 not exceed the inflation-adjusted expenditures that were made
under the prior statute as stated in section 1834(l) of the Act. The FS
was to reallocate expenditures among ambulance providers and suppliers
in a manner that did not result in an increase in aggregate payments
for ambulance services (for example, some providers and suppliers would
have received higher payments, others would have received lower
payments, and the changes would have offset each other.) Only
additional payments made under the BIPA mileage provision were not
required to meet this criteria. Applying the FS to the January 1, 2000
through March 31, 2002 period would violate this principle unless the
FS applied to all ambulance providers and suppliers, not just those
seeking additional payment under it. Accordingly, we may have to recoup
monies paid to those providers and suppliers whose payments were
greater under the pre-existing ``reasonable charge'' and ``reasonable
cost'' system when compared to what they would have received under the
FS for the January 1, 2000 through March 31, 2002 period. Applying the
FS retroactively to the providers and suppliers would arguably not
constitute a fair phase-in of the FS provisions.
III. Waiver of Proposed Rulemaking
We ordinarily publish a notice of proposed rulemaking in the
Federal Register and invite public comment on the proposed rule. The
notice of proposed rulemaking includes a reference to the legal
authority under which the rule is proposed, and the terms and substance
of the proposed rule or a description of the subjects and issues
involved. This procedure can be waived, however, if an agency finds
good cause that a notice-and-comment procedure is impracticable,
unnecessary, or contrary to the public interest and incorporates a
statement of the finding and its reasons in the rule issued.
The FS being withdrawn by this notice was only put in place
pursuant to the court's order in Lifestar, and explicitly provided that
it would not be effective in the event the Lifestar decision was
overturned on appeal. The Lifestar decision has been vacated, and the
case in district court dismissed. To our knowledge no payments have
been made under the FS to date and, had they been, such payments would
be subject to recoupment pursuant to the provisions of the April 16,
2003, notice. Accordingly, there is no reason to keep a FS in place
that CMS is no longer required to promulgate, and under which it would
make no payments in light of the appellate court decision. To leave the
FS in place while awaiting comments would only generate confusion on
the part of ambulance providers and suppliers.
Therefore, we find good cause to waive the notice of proposed
rulemaking with respect to the issuance of this notice.
IV. Collection of Information Requirements
This document does not impose information collection and
recordkeeping requirements. Consequently, it need not be reviewed by
the Office of Management and Budget under the authority of the
Paperwork Reduction Act of 1995 (44 U.S.C. 35).
V. Regulatory Impact Statement or Analysis
We have examined the impact of this notice as required by Executive
Order 12866 (September 1993, Regulatory Planning and Review), the
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354),
section 1102(b) of the Social Security Act, the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132.
Because the FS for the January 1, 2000 through March 31, 2002 is
not one under which we are required to make payments in light of the
Eleventh Circuit reversal of the district court decision, withdrawing
the FS will have no financial impact on providers and suppliers, or on
government spending.
Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
significant effects ($100 million or more in any 1 year). Because the
FS being withdrawn is not one under which we are required to make
payments, in light of the Eleventh Circuit decision, withdrawing it
will have no financial impact on program spending. Therefore, this
notice is not a major notice as defined in Title 5, United States Code,
section 804(2) and is not an economically significant notice under
Executive Order 12866.
The RFA requires agencies to analyze options for regulatory relief
of small entities. For purposes of the RFA, small entities include
small businesses, nonprofit organizations, and small governmental
jurisdictions. Most hospitals and most other providers and suppliers
are small entities, either by nonprofit status or by having revenues of
$6 million to $29 million in any 1 year. Individuals and States are not
considered to be small entities. We have determined that this notice
will not
[[Page 52108]]
have a significant economic impact on a substantial number of small
entities. Therefore, we are not preparing an analysis for the RFA.
In addition, section 1102(b) of the Social Security Act (the Act)
requires us to prepare a regulatory impact analysis if a rule may have
a significant impact on the operations of a substantial number of small
rural hospitals. This analysis must conform to the provisions of
section 604 of the RFA. For purposes of section 1102(b) of the Act, we
define a small rural hospital as a hospital that is located outside of
a Metropolitan Statistical Area and has fewer than 100 beds. We have
determined that this notice will not have a significant effect on the
operations of a substantial number of small rural hospitals. Therefore,
we are not preparing an analysis for section 1102(b) of the Act.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule that may result in expenditures in any 1 year by
State, local, or tribal governments, in the aggregate, or by the
private sector, of $110 million. This notice has no consequential
effect on State, local, or tribal governments or on the private sector.
Executive Order 13132 establishes certain requirements that an
agency must meet when it publishes a rule that imposes substantial
direct requirement costs on State and local governments, preempts State
law, or otherwise has Federalism implications. This notice will not
have a substantial effect on State or local governments. There are no
other alternatives at this time.
In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
Authority: Sections 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)
Dated: May 17, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
Approved: August 25, 2005.
Michael O. Leavitt,
Secretary.
[FR Doc. 05-17278 Filed 8-26-05; 9:46 am]
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