CMS Proposes to Change or Eliminate a Number of Conditions of Participation for Hospitals, Long Term Care Facilities and Other Providers

Changes to the conditions of participation (CoPs) for hospitals, long-term care facilities, transplant centers, and rural health centers, as well as the conditions for coverage (CfCs) of ambulatory surgical centers (ASC) have been announced by CMS in an advance release of a Proposed rule to be published in the Federal Register on February 7, 2012. Major changes would include allowing any practitioner to refer patients for an outpatient procedure; removal of the three-year survey requirement for organ transplant facilities; providing a two-year extension for long term care facilities to install automatic sprinkler systems; allowing dieticians to order meals without the supervision of a physician; deleting the requirement that ASCs have a radiologist on staff; and changing how proficiency testing samples are handled by clinical laboratories. CMS estimates that these changes would save $676 million annually and $3.4 billion over five years.

These changes are designed to remove obsolete, excessively burdensome, redundant or unnecessary regulations in accordance with Executive Order 13563, which requires federal agencies to establish a plan for ongoing retrospective review of significant regulations to identify those that can be eliminated. This is the second effort by CMS to reduce burdensome regulations. On May 16, 2012, CMS published two Final rules (77 FR 29061 and 77 FR 29033) that made significant changes to CoPs for a number of providers.


Under the Proposed rule, hospital’s governing bodies would no longer be required to include a member of the medical staff. Instead, governing bodies would be required to consult with medical staff on an ongoing basis. This is designed to alleviate some of the problems hospitals have been experiencing in appointing staff members to governing bodies, especially publicly owned hospitals whose members are appointed by strict process governed by state and local laws. The Proposed rule would allow outpatient services to be ordered by any practitioner who is (1) responsible for the care of patients, (2) licensed in the state where care is provided, (3) acting within his or her scope of practice under state law, and (4) authorized in accordance with the policies of the medical staff to order outpatient services. This would facilitate the ordering of rehabilitation and respiratory services by all practitioners and not just physicians. The preparation of radiopharmaceuticals would no longer be under the direct supervision of a registered pharmacist or doctor of medicine or osteopathy when this provision is made final. This was a burdensome requirement during off-hours when only minimal use of radiopharmaceuticals occurred. Dieticians would no longer be required to be supervised by physicians when ordering diets for patients, if the Proposed rule is adopted. Finally, swing-bed services would be an optional services provided by hospitals. Under this change, hospitals that provide swing-bed service would only have to be surveyed once, and not twice.

Long Term Care Facilities

All long term care facilities are to have automatic sprinkler systems installed throughout the building by August 13, 2013, according to a Final rule adopted on August 13, 2008 (73 FR 47075). Some facilities are experiencing problems in meeting this deadline. Under the Proposed rule, CMS would allow long term care facilities that (1) are in the process of replacing its current system, (2) have made financial commitments to completing the renovations, (3) have submitted construction plans to state and local authorities, and (4) agree to interim steps to improve fire safety to apply for a two year extension to the August 13, 2013 deadline.

Organ Transplant Centers

Organ transplant centers would no longer have to be resurveyed every three years. CMS believes that it obtains enough information regarding the services provided at the facilities from other reporting mechanisms. If the information in those mechanism indicates that a survey is necessary, CMS would conduct a survey of the facility. Also, for the same reasons, transplant facilities would no longer have to report to CMS when they are out of compliance with the 3-year average of 10 transplants per year.

Rural Health Care Providers

CMS is proposing to remove the requirement that a physician is present at least once every two weeks at critical access hospitals (CAHs), rural health care centers (RHCs), or federally qualified health care centers (FQHCs). There are substantial barriers to very remote facilities meeting this requirement. In addition, advance in telemedicine technologies has allowed physician to still provide these services without having to be physically present. Secondly, CAHs would no longer have to have a non-CAH staff member advise them on the development of patient care policies and procedures.

Clinical Laboratories

Laboratories are checked by conducting tests on samples sent to them. This proficiency testing (PT) is to be conducted without referring the sample to another laboratory for additional testing. Some labs, however, in the normal course of business will send samples to other labs to confirm their results or to retest when their test reveals an abnormality or result outside a specific range. If a PT sample is referred to another lab for this testing, the penalties are severe with the lab’s certificate being suspended and the owner being prohibited from owning another lab for 2 years. CMS is proposing to change the regulations for laboratories to provide for a less severe penalty for a single instance of PT referral, and stating in the regulation that PT samples must never be sent to another laboratory under any circumstances.