December 2001
Volume 65 |
Number 12
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WASHINGTON
REPORT
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| CMS’ Final Rule Retains
Federal Requirement for Supervision |
Michael Scott, J.D., Director
Governmental and Legal Affairs
On November 13, the Centers for Medicare & Medicaid Services
(CMS) issued its long-anticipated final rule retaining the federal
requirements that nurse anesthetists be supervised by a physician
in all Medicare-approved hospitals and ambulatory surgical centers
(ASCs). The rule, which is identical by its terms to the CMS proposed
rule issued July 5, was effective immediately.
Under the final rule, state governors are given the opportunity
to opt an institution or institutions out of the federal supervision
requirement: 1) after consultation with the state boards of medicine
and nursing, 2) if such a step is consistent with state law and
3) if the opt-out is found by the governor to be in the best interest
of the citizens of the state. The rule also expresses CMS’
intention to ask the federal Agency for Healthcare Research and
Quality to conduct an anesthesia outcomes study, comparing results
in states that opt out of the federal requirement with those that
have not.
In the final rule, CMS declined to adopt a number of refinements
to the proposed rule as suggested by ASA, including the proposal
that governors be required to provide the public with notice of
and an opportunity to comment on the opt-out. CMS expressed its
view that the mandating of state opt-out procedures by the federal
government was inappropriate and that procedural requirements
should be left to state law and a governor’s discretion.
CMS also rejected the objection by the American Association of
Nurse Anesthetists (AANA) to the requirement that a governor consult
with the state boards of medicine and nursing. CMS said that this
requirement was designed to “ensure appropriate involvement
of parties on both sides of [the supervision] issue.” The
agency also dismissed AANA’s proposal that states not currently
requiring supervision as a matter of state law be given an automatic
waiver from the federal requirement.
Publication of the final rule creates, for the first time, a
situation in which the states will bear sole, ultimate responsibility
for determining the appropriate supervision standards for Medicare/Medicaid
beneficiaries as well as all other residents having anesthesia.
Over the last 35 years and until November 13, all current supervision-related
state statutes and regulations have been adopted with the knowledge
of existence of the federal rule, applicable to all patients in
all Medicare-approved hospitals and ASCs. In these new circumstances,
it is reasonable to assume that state governors, legislatures
and regulatory bodies will approach the supervision standard with
even greater care than in the past, having due regard for the
scientific outcomes studies disclosing a higher standard of care
when physicians are involved.
CMS’ action represents the culmination of a four-year struggle
over the supervision issue at the federal level. The Clinton administration
proposed elimination of the federal requirement in December 1997
and finalized the proposal in January of this year, only to have
the effectiveness of the final rule suspended by President Bush
upon taking office. ASA has supported the current administration’s
proposed rule, issued last July, as a “judicious compromise”
of the varying views, in effect continuing the federal government’s
commitment to patient safety while also recognizing the traditional
domain of the states concerning licensure and scope of practice.
Negative MFS Update Limit Proposed by New Senate Bill S. 1707
On November 8, Senators James M. Jeffords (I-VT) and John B.
Breaux (D-LA) introduced the Medicare Physician Payment Fairness
Act (S. 1707), which would limit to 0.9 percent the 5.4-percent
negative Medicare Fee Schedule (MFS) adjustment for calendar year
2002, as announced by the Centers for Medicare & Medicaid
Services (CMS) on November 2.
Were the bill to pass, the actual 2002 negative adjustment to
the anesthesiology conversion factor would be somewhat more than
0.9 percent because of required additional negative adjustments
to account for physician work adjustments approved by CMS for
2002 as well as practice expense adjustments adopted three years
ago that are being phased in over four years.
Even more significantly for the longer term, the bill requires
the federal Medicare Payment Advisory Commission (MedPAC), which
reports to Congress, to conduct a study on replacing the use of
the sustainable growth rate (SGR) update formula with a new formula
“that more fully accounts for changes in the unit costs of
providing physicians’ services.” MedPAC is required
to file its report and recommendations by March 1, 2002. MedPAC
has previously denominated the SGR formula as seriously flawed,
and hope thus exists for passage of legislation next year adopting
a new update formula.
ASA is actively engaged with the American Medical Association
and other specialties in seeking to gain adoption of the Jeffords-Breaux
bill. Because its implementation would require the commitment
of additional funds to the Medicare program, the bill’s chances
of passage are uncertain. If legislation on this subject does
pass the Congress before year-end, ASA members will be promptly
notified by means of a President’s Update.
House Committees Draft Regulatory Relief Bills
As this column is written, the House Energy and Commerce and
Ways and Means committees each have all but completed work on
comparable Medicare regulatory relief legislation and are in the
process of attempting to craft an agreed bill to be brought to
the House floor. The bills are being actively supported by organized
medicine, including ASA.
Both bills would mandate substantial improvement in Medicare
carrier practices in responding to inquiries from physicians as
to appropriate reimbursement standards, would significantly limit
the circumstances under which extrapolation of billing errors
would be permitted and would contain substantial due-process protection
for physicians involved in government audits.
As of this moment, a substantial possibility exists that an agreed
bill, supported by organized medicine, will be acted on by the
House soon and that the bill will be attached to a piece of omnibus
legislation to be passed by Congress before the end of the year.
If passage occurs, a more complete report will appear in the January
2002 issue of the NEWSLETTER.
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