iProtean—CMS Proposed Rule Will Reduce Regulations for Hospitals

The Centers for Medicare & Medicaid Services (CMS) continues to take steps to reduce unnecessary and burdensome regulations on hospitals, according to a recent CMS press release.  “Reforms to Medicare regulations identified as unnecessary, obsolete, or excessively burdensome on hospitals and health care providers would save nearly $676 million annually, and $3.4 billion over five years, through a rule proposed today by the Centers for Medicare & Medicaid services (CMS). ” (U.S. Department of Health & Human Services, “Reforms of regulatory requirements to save health care providers $676 million annually,” February 4, 2013.)


This latest proposed rule change follows two earlier rule changes by CMS in May 2012. Many of the current rule’s provisions streamline the standards healthcare providers must meet to participate in Medicare and Medicaid (i.e., Conditions of Participation, or CoP).


Clarification on Governing Boards

An earlier rule in May 2012 amended the CoP regarding governing bodies.  CMS proposed that a hospital’s governing body must include a member or members of the hospital’s medical staff. Because of competing objections to this rule change from the American Hospital Association and the American Medical Association, CMS said it would undertake further review.


The February 2013 rule revisits this and now proposes to remove the requirement for a medical staff member to be on the hospital’s governing body.  Rather, a new requirement is proposed:  a hospital’s governing board must directly consult at least periodically throughout the year with the individual responsible (or his/her designee) for the organized medical staff of the hospital.  For a multi-hospital system with a single governing board, the governing body must directly consult at least periodically throughout the year with the individual responsible (or his/her designee) for the organized medical staff of the hospital of each hospital within its system.


Distinct Medical Staff for Each Hospital

CMS also is proposing to revise the hospital CoPs to require that each hospital have an organized and individual medical staff, distinct to that individual hospital, that operates under bylaws approved by the governing body and that is responsible for the quality of medical care provided to patients by that individual hospital. This implies that a multi-hospital system may not have one integrated medical staff serving more than one hospital.


Other Proposed Rule Changes

Other features of the new proposed rule include:

  • Eliminating the requirement that physicians be onsite once every two weeks at small critical access hospitals, rural health clinics and federally qualified health centers
  • Reducing requirements ambulatory surgery centers must meet to provide radiological services
  • Granting privileges to qualified dietitians to order patient diets under hospital CoPs
  • Allowing trained nuclear medicine technicians in hospitals to prepare radiopharmaceuticals for nuclear medicine without the presence of a supervising physician or pharmacist
  • Eliminating redundant data submission requirements and automatic, three-year review and survey process for transplant center
  • Allowing practitioners who are not on a hospital’s medical staff to order hospital outpatient services for their patients when authorized by the medical staff and allowed by state law


Comments on the proposed rule are due April 8.

(“CMS Says Proposed Rule Aimed At Reducing Regulatory Burdens On Healthcare Providers Will Save $676 Million Annually,” Health Lawyers Weekly, February 08, 2013 Vol. XI Issue 5.)


A note to iProtean subscribers:  a new advanced course, Financing Considerations for Integrated Delivery Systems, will be published in your library this month. Experts in this course, Marian Jennings, Lisa Goldstein, Dan Grauman and Nate Kaufman, examine the key drivers for system ownership or partnership with health plans. They discuss what boards and executives should consider when evaluating owning vs. partnering with a health plan.



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