RULES AND REGULATIONS
Title 55—HUMAN SERVICES
DEPARTMENT OF HUMAN SERVICES
[55 PA. CODE CH. 1101]
Interrelationship of Providers
[53 Pa.B. 376]
[Saturday, January 14, 2023]The Department of Human Services (Department), under the authority of section 403.1(a)(6) of the Human Services Code (code) (62 P.S. § 403.1(a)(6)), amends § 1101.51 (relating to ongoing responsibilities of providers) to read as set forth in Annex A. Notice of the proposed rulemaking was published at 51 Pa.B. 3468 (June 26, 2021).
Purpose of this Final-Form Rulemaking
The purpose of this final-form rulemaking is to delete § 1101.51(c)(3), which prohibits providers from leasing or renting space, shelves or equipment within a provider's office to another provider or from allowing the paid or unpaid staff of a provider to be placed in another provider's office.
Developments in the health care industry have emphasized the need for integrated health care. The Department recognizes the benefits of integrated care and deletes this subsection to support the enrollment in the Medical Assistance (MA) Program of providers that share space (co-locating providers). By expanding provider qualifications to include co-locating providers, the Department seeks to support more coordinated and integrated care within the MA Program.
Background
Section 1407(a)(2) of the code (62 P.S. § 1407(a)(2)) provides that it is unlawful to solicit or receive or to offer or pay any remuneration, including any kickback, bribe or rebate, directly or indirectly, in cash or in kind from or to any person in connection with the furnishing of services or merchandise for which payment may be in whole or in part under the MA Program or in connection with referring an individual to a person for the furnishing or arranging for the furnishing of any services or merchandise for which payment may be made in whole or in part under the MA Program. The Department promulgated the regulation in § 1101.51(c)(3) to provide specific examples of the types of arrangements that section 1407(a)(2) of the code prohibits. Among the examples is that providers may not ''lease or rent space, shelves or equipment within a provider's office to another provider or allowing the placement of paid or unpaid staff of another provider in a provider's office.''
This regulation prevented co-locating providers from enrolling in the MA Program. Since promulgation of this regulation, the health care industry has moved to a more integrated approach to diagnosis and treatment of conditions or injuries. To support that trend, retail clinics, some of which are placed within the same building as a pharmacy, have emerged, and multidisciplinary providers, including physical and behavioral health providers, have entered into co-location arrangements between distinct providers.
According to an informational bulletin issued by the Centers for Medicare & Medicaid Services on January 16, 2014, titled ''Reducing Non-Urgent Use of Emergency Departments and Improving Appropriate Care in Appropriate Settings,'' increasing access to primary care services, including through urgent care and retail clinics, has been estimated to result in a potential savings of $4.4 billion Nationwide. Mann, C. (January 16, 2014). Reducing Nonurgent Use of Emergency Departments and Improving Appropriate Care in Appropriate Settings. Retrieved from https://www.hhs.gov/guidance/document/reducing-nonurgent-use-emergency-departments-and-improving-appropriate-care-appropriate. These arrangements increase consumer access to services, including behavioral health and substance use disorder services. Co-location can decrease out-of-pocket costs to beneficiaries related to transportation and childcare and encourage follow-up with referred providers. Co-location can encourage contact between providers and foster communication about shared patients. Medicaid and CHIP Payment and Access Commission (March 2016). Report to Congress on Medicaid and CHIP. Retrieved from https://www.macpac.gov/publication/march-2016-report-to-congress-on-medicaid-and-chip/. The Department, by establishing provider qualifications that incorporate co-locating providers, supports these advancements in the health care industry when services are provided in a manner that allows the beneficiary to retain freedom to choose the service provider and is not automatically directed to or referred to a co-located provider.
After reviewing the trend in the health care delivery system toward integrated care, the Department determined that a narrow interpretation of § 1101.51(c)(3) is more restrictive than required to comply with the code and prevents co-locating providers who are otherwise eligible from enrolling in the MA Program. On May 28, 2016, the Department issued Statement of Policy (SOP) 1101-16-03, codified in § 1101.51a (relating to clarification of the term ''within a provider's office''—statement of policy), to clarify the meaning of ''within a provider's office'' and the guidelines for providers that enter into co-location arrangements with other participating providers. See 46 Pa.B. 2683 (May 28, 2016); 55 Pa. Code § 1101.51a. The Department also developed an attestation form to be utilized by providers seeking to co-locate, in which each provider attests to its compliance with Federal and State antikickback laws, the Health Insurance Portability and Accountability Act of 1996 (Pub.L. No. 104-191) (HIPAA), and MA beneficiary freedom of choice. The Department will rescind the SOP upon the effective date of this final-form rulemaking.
In an effort to establish provider qualifications that allow co-locating providers to enroll in the MA Program, the Department deletes the regulation in § 1101.51(c)(3), which prohibits providers from leasing space within a provider's office to another provider. Allowing different types of providers to be located in the same space benefits MA beneficiaries by providing the opportunity for a more integrated approach to healthcare. Providers must continue to comply with any other applicable law, including HIPAA, Federal and State antikickback and self-referral laws, and the requirement to provide MA beneficiaries with freedom of choice.
The deletion of the regulation in § 1101.51(c)(3) does not invalidate other laws or requirements affecting co-locating providers if, for example, they are prohibited by law, including licensing laws, or certification requirements, from leasing or renting space, shelves or equipment or otherwise sharing space.
Requirements
The following is a summary of the specific provision in this final-form rulemaking:
§ 1101.51(c)(3) (relating to ongoing responsibilities of providers)
The Department deletes subsection (c)(3) to allow co-locating providers to enroll in the MA Program and to support integrated health care in the MA Program. Deletion of subsection (c)(3) allows MA beneficiaries to receive services in a more integrated manner, consistent with developments in the health care industry.
Affected Individuals and Organizations
Nine co-located providers operating at 82 separate locations have requested and received a waiver of the regulation in § 1101.51(c)(3) from the Department Secretary. Under § 1101.51a, beginning May 28, 2016, any provider who enrolled and was co-located with another provider had to complete an attestation. Current waivers and attestations will remain in effect until publication of this final-form rulemaking which eliminates the co-location provision in § 1101.51(c)(3).
The deletion of § 1101.51(c)(3) provides the regulatory framework to promote integrated health care services by establishing provider qualifications that allow providers that co-locate to enroll in the MA Program. Providers that want to co-locate in the future will be able to do so without obtaining a waiver or submitting an attestation.
Accomplishments and Benefits
This final-form rulemaking deletes the regulatory provision that has prevented or delayed enrollment of providers who are co-located. Allowing different types of providers to be located in the same space will benefit MA beneficiaries by providing the opportunity for a more integrated approach to health care.
Fiscal Impact
There is no fiscal impact.
Contact Persons
Interested persons are invited to submit written comments, suggestions or objections regarding this final-form rulemaking to Lacey Gates, Department of Human Services, Office of Medical Assistance Programs, Bureau of Policy, Analysis and Planning, P.O. Box 2675, Harrisburg, PA 17120, RA-PWMAProgComments@pa.gov. Reference regulation # 14-549 in the subject line.
Persons with a disability who require an auxiliary aid or service may use the Pennsylvania Hamilton Relay Service, (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
Paperwork Requirements
This final-form rulemaking does not require additional reports or paperwork or any new forms. Less paperwork is required because an attestation form is not required for enrollment of providers that are co-located.
Effective Date
This final-form rulemaking will take effect upon publication in the Pennsylvania Bulletin.
Public Comment
Written comments, suggestions and objections regarding the proposed rulemaking were requested within a 30-day period following its publication at 51 Pa.B. 3468. The Department received written responses from five commentators. The comments represented feedback from a provider and from associations, including provider associations and advocates. The Independent Regulatory Review Commission (IRRC) advised the Department that it had no objections, comments or recommendations.
The following is a summary of the comments received within the public comment period and the Department's responses to those comments.
Comment: Four commentators offered support of the proposed rulemaking.
Response: The Department acknowledges these comments and thanks the commentators for the support.
Comment: One commentator requested clarification from the Department that none of the proposed changes shall be construed to override the consumer protections contained in Act 122 of 2013, which include prohibiting the placement of laboratory personnel in a provider's office.
Response: The Department acknowledges the concerns with respect to section 3 of the act of December 18, 2013 (P.L. 1232, No. 122), amending The Clinical Laboratory Act (35 P.S. §§ 2151—2165). None of the proposed changes invalidate other laws or requirements affecting providers. If providers are prohibited from co-locating or from leasing or renting space, shelves or equipment by a law, licensing, certification or other requirement, those requirements remain in effect.
Regulatory Review Act
Under section 5(a) of the Regulatory Review Act (71 P.S. § 745.5(a)), on June 10, 2021, the Department submitted a copy of the notice of proposed rulemaking, published at 51 Pa.B. 3468, to IRRC and the Chairpersons of the House Health Committee and the Senate Health and Human Services Committee for review and comment.
Under section 5(c) of the Regulatory Review Act, the Department is required to submit to IRRC and the House and Senate Committees copies of comments received during the public comment period, as well as other documents when requested. In preparing this final-form rulemaking, the Department has considered all comments from IRRC, the House and Senate Committees, and the public.
Under section 5.1(j.2) of the Regulatory Review Act (71 P.S. § 745.5a(j.2)), on November 30, 2022, the final-form rulemaking was approved by the House and Senate Committees. Under section 5.1(e) of the Regulatory Review Act, IRRC met on December 8, 2022, and approved this final-form rulemaking.
Findings
The Department finds that:
(1) Public notice of proposed rulemaking was given under sections 201 and 202 of the act of July 31, 1968 (P.L. 769, No. 240) (45 P.S. §§ 1201 and 1202), referred to as the Commonwealth Documents Law, and regulations promulgated thereunder at 1 Pa. Code §§ 7.1 and 7.2 (relating to notice of proposed rulemaking required; and adoption of regulations).
(2) A public comment period was provided as required by law and all comments were considered in drafting this final-form rulemaking.
(3) The amendment to the regulation in the manner provided by this Order is necessary and appropriate for the administration of the code.
Order
The Department, acting under the code, orders that:
(a) The regulations of the Department at 55 Pa. Code Chapter 1101 are amended by amending § 1101.51 to read as set forth in Annex A of this order, with ellipses referring to the existing text of the regulation.
(b) The Department shall submit this final-form rulemaking and Annex A to the Offices of General Counsel and Attorney General for approval as to legality and form as required by law.
(c) The Department shall submit this final-form rulemaking to IRRC and the Legislative Standing Committees as required by law.
(d) The Department shall certify and deposit this final-form rulemaking and Annex A with the Legislative Reference Bureau as required by law.
(e) This final-form rulemaking shall take effect upon final publication in the Pennsylvania Bulletin.
MEG SNEAD,
Acting Secretary(Editor's Note: See 52 Pa.B. 8009 (December 24, 2022) for IRRC's approval order.)
Fiscal Note: Fiscal Note 14-549 remains valid for the final adoption of the subject regulation.
Annex A
TITLE 55. HUMAN SERVICES
PART III. MEDICAL ASSISTANCE MANUAL
CHAPTER 1101. GENERAL PROVISIONS
RESPONSIBILITIES § 1101.51. Ongoing responsibilities of providers.
* * * * * (c) Interrelationship of providers. Providers are prohibited from making the following arrangements with other providers:
(1) The referral of MA recipients directly or indirectly to other practitioners or providers for financial consideration or the solicitation of MA recipients from other providers.
(2) The offering of, or paying, or the acceptance of remuneration to or from other providers for the referral of MA recipients for services or supplies under the MA Program.
(3) [Reserved].
(4) The solicitation or receipt or offer of a kickback, payment, gift, bribe or rebate for purchasing, leasing, ordering or arranging for or recommending purchasing, leasing, ordering or arranging for or recommending purchasing, leasing or ordering a good, facility, service or item for which payment is made under MA. This does not preclude discounts or other reductions in charges by a provider to a practitioner for services, that is, laboratory and x-ray, so long as the price is properly disclosed and appropriately reflected in the costs claimed or charges made by a practitioner.
(5) A participating practitioner or professional corporation may not refer a MA recipient to an independent laboratory, pharmacy, radiology or other ancillary medical service in which the practitioner or professional corporation has an ownership interest.
* * * * *
[Pa.B. Doc. No. 23-48. Filed for public inspection January 13, 2023, 9:00 a.m.]
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