Medicaid Program; Inpatient Psychiatric Services for Individuals Under Age 21; Proposed Rules DEPARTMENT OF HEALTH AND HUMAN SERVICES

SUMMARY: This proposed rule would amend our regulations to establish

psychiatric residential treatment facilities as a new category of

Medicaid facility, and establish standards that these facilities would

have to meet; and specify that psychiatric units of general hospitals

may be used for acute psychiatric care for individuals under age 21. It

also would improve the regulatory implementation of the statutory

requirements for State development of a comprehensive mental health

program and coordination of various State authorities concerned with

provision of mental health and related services. In addition, this

proposed rule would ensure that representatives from agencies providing

services to an individual develop and manage a coordinated plan of care

whenever feasible.

This rule would implement section 4755(a) of the Omnibus Budget

Reconciliation Act of 1990 (Public Law 101-508).

DATES: Written comments will be considered if we receive them at the

appropriate address, as provided below, and must be received no later

than 5:00 p.m. on January 17, 1995.

ADDRESSES: Mail written comments (one original and two copies) to the

following address:

Health Care Financing Administration, Department of Health and Human

Services, Attention: MB-60-P, P.O. Box 7518, Baltimore, Maryland 21207-

0518.

If you prefer, you may deliver your written comments (one original and

two copies) to one of the following addresses:

Room 309-G, Hubert H. Humphrey Building, 200 Independence Ave., SW.,

Washington, DC or

Room 132, East High Rise Building, 6325 Security Boulevard, Baltimore,

Maryland.

Due to staffing and resource limitations, we cannot accept comments

by facsimile (FAX) transmissions.

In commenting, please refer to file code MB-60-P. Written comments

received timely will be available for public inspection as they are

received, beginning approximately three weeks after publication of this

document, in Room 309-G of the Department's offices at 200 Independence

Ave., SW., Washington, DC on Monday through Friday of each week from

8:30 a.m. to 5:00 p.m. (phone: 690-7890).

If you wish to submit written comments on the information

collection requirements contained in this proposed rule, you may submit

written comments to:

Laura Oliven, HCFA Desk Officer, Office of Information and Regulatory

Affairs, Room 3001, New Executive Office Building, Washington, D.C.

20503.

FOR FURTHER INFORMATION CONTACT: Winona Hocutt, (410) 966-4625.

SUPPLEMENTARY INFORMATION:

I. Background

Medicaid is the Federally assisted State program authorized under

title XIX of the Social Security Act (the Act) to provide funding for

medical care provided to certain needy aged, blind and disabled

persons, families with dependent children, and low-income pregnant

women and children. Each State determines the scope of its program,

within limitations and guidelines established by the law and the

implementing regulations at 42 CFR chapter IV, subchapter C. Each State

submits a State plan that, when approved by HCFA, provides the basis

for granting Federal funds to cover part of the expenditures incurred

by the State for medical assistance and the administration of the

program.

Section 1902(a) of the Act specifies the eligibility requirements

that individuals must meet in order to receive Medicaid. Other sections

of the Act describe the eligibility groups in detail and specify

limitations on what may be paid for as ``medical assistance.''

II. Statutory and Regulatory History--Inpatient Psychiatric

Hospital Services Benefit for Individuals Under Age 21

The Social Security Amendments of 1972 (Public Law 92-603) amended

the Medicaid statute to, among other things, allow States the option of

covering inpatient psychiatric hospital services for individuals under

age 21. In this preamble, we will refer to inpatient psychiatric

hospital services for individuals under age 21 as the ``psychiatric\21

benefit.'' Originally the statute required that the psychiatric\21

benefit be provided by psychiatric hospitals that were accredited by

the Joint Commission on Accreditation of Hospitals. This organization

is now called the Joint Commission on Accreditation of Healthcare

Organizations. We will refer to this organization as the ``Joint

Commission.''

In 1976 the Social and Rehabilitation Service, one of the agencies

that later merged to form HCFA, published final regulations in the 45

CFR part 249 implementing the psychiatric\21 benefit. These regulations

allowed the coverage of this benefit in psychiatric facilities that

were accredited by the Joint Commission. The term ``psychiatric

facility'' was used rather than the statutory term ``psychiatric

hospital'' because the Joint Commission had modified its accrediting

practices to encompass a broader range of settings providing

psychiatric services. Since the statute at that time required Joint

Commission accreditation, HCFA desired to keep its requirements

consistent with Joint Commission practices.

In 1981 HCFA received comments from the Joint Commission expressing

concern about HCFA's regulatory requirement for Joint Commission

accreditation. The Joint Commission indicated that this Federal

requirement was in conflict with Joint Commission policy that

facilities should seek accreditation voluntarily. In response, HCFA

noted that the regulatory requirement for Joint Commission

accreditation could not be removed because it was required by statute.

In 1984, the Congress amended section 1905(h) of the Act, removing

the requirement for Joint Commission accreditation and adding the

requirement that providers of the psychiatric\21 benefit meet the

definition of a ``psychiatric hospital'' under the Medicare program as

specified in section 1861(f) of the Act (section 2340 of the Deficit

Reduction Act of 1984 (Public Law 98-369)).

Despite this statutory change, based on our understanding of

Congressional intent, we did not remove the requirement for Joint

Commission accreditation from HCFA regulations, which are in subpart D

of 42 CFR part 441. Our reliance on Joint Commission accreditation was

the only basis for coverage of the psychiatric\21 benefit in

psychiatric facilities other than psychiatric hospitals. Our decision

to retain the regulatory requirement for Joint Commission accreditation

was based on the fact that, in enacting the 1984 amendment, the

Congress gave no indication that it intended to narrow the

psychiatric\21 benefit or alter HCFA policy that had been in effect

since 1976.

On November 5, 1990, the Omnibus Budget Reconciliation Act of 1990

(OBRA '90), Public Law 101-508, was enacted. Consistent with HCFA's

interpretation reflected in 42 CFR 441 et seq., section 4755 of OBRA

'90 amended section 1905(h) of the Act to specify that the

psychiatric\21 benefit can be provided in psychiatric hospitals that

meet the definition of that term in section 1861(f) of the Act ``or in

another inpatient setting that the Secretary has specified in

regulations.'' This amendment, which was effective as if it had been

enacted earlier as part of the Deficit Reduction Act of 1984, affirmed

and effectively ratified preexisting HCFA policy as articulated in

subpart D of 42 CFR part 441, which interpreted sections 1905(a)(16)

and 1905(h) of the Act as not being limited solely to psychiatric

hospital settings. OBRA '90, therefore, provides authority for HCFA to

specify inpatient settings in addition to the psychiatric hospital

setting for the psychiatric\21 benefit without continuing to require

that providers obtain Joint Commission accreditation.

III. Related Provisions

Under section 1905(a) of the Act, Medicaid payment is generally not

available for any services provided to individuals under age 65 who are

patients in ``institutions for mental diseases'' (IMDs). This statutory

preclusion of Medicaid payment is commonly known as the ``IMD

exclusion.'' The term ``IMD'', as defined in section 1905(i) of the

Act, includes hospitals, nursing facilities, or other institutions of

more than 16 beds that are primarily engaged in providing diagnosis,

treatment, or care of persons with mental diseases, including medical

attention, nursing care, and related services.

The psychiatric\21 benefit, at section 1905(a)(16) of the Act, is

the only statutory exception to the IMD exclusion. The psychiatric\21

benefit is optional, and it is currently covered under 41 State plans.

The psychiatric\21 benefit must, however, be provided in all States to

those individuals who are determined during the course of an Early and

Periodic Screening, Diagnosis, and Treatment (EPSDT) screen to need

this type of inpatient psychiatric care. Under the EPSDT provisions at

section 1905(r)(5) of the Act, as amended by section 6403 of the

Omnibus Budget Reconciliation Act of 1989, Public Law 101-239, States

must provide any service listed in section 1905(a) of the Act that is

needed to correct or ameliorate defects and physical and mental

conditions discovered by EPSDT screening services, whether or not the

service is covered under the State plan.

While some inpatient psychiatric services can be provided in the

psychiatric units of general hospitals as ``inpatient hospital

services'' under section 1905(a)(1) of the Act, the services provided

under the psychiatric\21 benefit, and which meet the regulatory

requirements in subpart D of part 441, must also be available for

children and adolescents who are determined to need these services as a

result of an EPSDT screen. Because of the section 1905(r)(5)

requirement, even States that do not elect to include the optional

psychiatric\21 benefit in their State plans must be aware of its

provisions so that inpatient psychiatric services can be provided to

EPSDT-eligible individuals who are determined to require them.

Under current law, Medicaid payment for psychiatric services can be

available under a variety of services and settings listed in section

1905(a) of the Act. Optional inpatient psychiatric services are

available for individuals age 65 or over in IMDs which are inpatient

hospitals or nursing facilities (section 1905(a)(14) of the Act).

Payment is available for medically necessary inpatient psychiatric

services provided to Medicaid recipients of all ages in general

hospitals, since such hospitals are typically not IMDs. Outpatient

psychiatric services can be covered in the outpatient hospital setting

or under the optional clinic or rehabilitative services benefits (see

sections 1905(a)(2)(A), 1905(a)(9) and 1905(a)(13) of the Act).

Finally, the physicians' service benefit under section 1905(a)(5)(A) of

the Act can include psychiatrists' services.

Under section 1905(a) of the Act, Medicaid payment is available for

case management services, as defined in section 1915(g)(2) of the Act,

which can be used to coordinate needed mental health services. Case

management services assist individuals in gaining access to needed

medical, social, educational, and other services. Moreover, under

section 1915(g)(1), such case management services may be targeted to

chronically mentally ill persons. Although coverage of case management

services is generally optional for States, the case management services

under section 1905(a)(19) must be provided under the EPSDT authority

cited above if the need for these services is discovered during an

EPSDT screen (see section 1905 (r)(5)).

Section 4722 of OBRA '90 amended section 1905(a) of the Act to

provide that no service shall be excluded from the definition of

``medical assistance'' solely because it is provided as a treatment

service for alcoholism or drug dependency. (Under the International

Classification of Diseases, which HCFA relies on for classification

purposes, alcoholism and chemical dependency are classified as mental

disorders.) This provision does not override the IMD exclusion, nor

does it require a State to include chemical dependency treatment under

any other optional benefit unless it chooses to do so.

Since the Medicaid statute was enacted in 1965, it has required

that all State agencies involved with mental health care coordinate

their activities. Specifically, section 1902(a)(20)(A) of the Act

requires that the State Medicaid agency, in a State offering the

optional IMD benefit under section 1905(a)(14), have agreements or

other arrangements with other State authorities concerned with mental

diseases. These include arrangements for joint planning and development

of alternate methods of care, and arrangements providing assurance of

immediate readmittance to institutions, where needed, for individuals

under alternate plans of care. The IMD services authorized under

section 1905(a)(14) currently are provided by 45 States.

Section 1902(a)(20)(B) of the Act contains additional requirements

regarding IMD benefits for individuals age 65 or older. Among other

provisions, this section requires that the Medicaid State plan provide

for an individual plan for each patient who may be in need of

institutional care to ensure that any ``institutional care provided to

him is in his best interests, including, to that end, assurances that

there will be initial and periodic review of his medical and other

needs.'' In addition, the State plan must include assurances that each

patient will be given appropriate treatment within the institution, and

that each patient will have a periodic assessment of the need for

continued treatment in the institution.

Section 1902(a)(20)(C) of the Act further requires States that

offer the IMD benefit to provide for development of alternate plans of

care, making maximum utilization of available resources, for recipients

age 65 or older who would otherwise need institutional care, including

appropriate medical treatment and other aid or assistance. This section

also requires that States develop the methods of administration

necessary to ensure that these responsibilities of the State agency for

these recipients are effectively carried out.

Section 1902(a)(21) of the Act requires that these States show that

they are making satisfactory progress toward developing and

implementing a comprehensive mental health program, including provision

for utilization of community mental health centers and other

alternatives to care in public IMDs. (The State's comprehensive mental

health services plan, which a State has prepared in accordance with

section 1912 of the Public Health Service Act, can serve as a basis for

this process). These statutory requirements were designed to ensure

that the mental health services covered by Medicaid are coordinated

with all related services provided by other State authorities and that

appropriate alternatives to institutional care are available. These

requirements are implemented in our regulations at 42 CFR 441.106,

which provides, among other things, that if a State plan includes

services in public institutions for mental diseases, the State must

implement a comprehensive mental health program which covers all ages.

In this way, we make clear that a comprehensive program must include

services for individuals under age 21 and over age 64 who are possible

candidates for Medicaid coverage of inpatient psychiatric care as well

as services for individuals age 22 through 64 who do not have a

Medicaid benefit for inpatient psychiatric care.

IV. General Goal of Proposed Regulatory Revisions

We are preparing the proposed regulations under the authority

provided by section 1905(h) of the Act, as amended by section 4755 of

OBRA '90, to specify alternative inpatient settings in which inpatient

psychiatric services may be covered for individuals under age 21. We

also propose to update our rules for the psychiatric\21 benefit to take

into account changes that have taken place in the provision of

psychiatric services since the existing regulations were published, and

to make implementation of the psychiatric\21 benefit consistent with

related Medicaid benefits and other statutory provisions.

In the process of developing these proposed regulations, we have

consulted with several other Federal agencies, including the Civilian

Health and Medical Programs of the Uniformed Services (CHAMPUS) and the

National Institutes of Mental Health (NIMH), a number of States, and

with a wide array of private organizations concerned with the provision

of mental health services to children and adolescents. We propose to

establish a policy which will improve coordination of the

psychiatric\21 benefit with other services generally being provided to

mentally ill children and adolescents, such as educational services,

child welfare services, and juvenile justice services.

Amid widespread concern that the services provided for mentally ill

children and adolescents and their families are often overlapping,

duplicative, and sometimes at cross-purposes because they have not been

coordinated with each other, many States have begun to coordinate the

activities of the State and local authorities involved with caring for

mentally ill children and adolescents to ensure joint planning and

joint provision of services. In many cases these efforts have been

based on the NIMH's Child and Adolescent Service System Program. In

addition, the Robert Wood Johnson Foundation has funded coordinated

``Mental Health Service Programs for Youth'' at 8 sites.

It is especially critical that the possible need for inpatient

services be considered in the context of all the services involved in a

child's or adolescent's care because an unnecessary admission can put

the individual at risk of a lifetime of public dependency. Inpatient

admission also inevitably results in trauma and disruption of a child's

normal support systems. Intensive services are increasingly available

in the community to help resolve crisis situations. When inpatient

admission is necessary, it is often needed because early intervention

and treatment have been lacking. For this reason, fewer admissions to

mental health facilities may be required when a comprehensive care

system has been in place for a period of time.

Coordinated programs are oriented toward the needs of children

rather than being structured according to the requirements of various

funding sources, and they result in a wider array of available

services. Coordinated programs can lower overall costs because

duplicative and unnecessary services can be eliminated, and optimal

services can be made available. If the array of services available is

uncoordinated, the patient runs the risk of an unnecessary admission

because the alternative services that may have been more effective are

not as readily available and the admission, therefore, occurs by

default.

Many studies have indicated that the most important factors in

maintaining the beneficial effects of mental health treatment for

children and adolescents are the availability and use of a wide range

of post-treatment resources. Such resources include appropriate

educational and vocational services and supportive services for the

family members who will have ongoing responsibility for caring for the

children. Many of these services are beyond the purview of the Medicaid

program, but they are, nonetheless, vital to the mental health of

Medicaid recipients and have direct bearing on future mental health

service needs. These proposed regulations would support State

coordination and planning efforts in this area (Sec. 441.106).

Psychiatric Treatment

Many professionals contend that psychiatric treatment should be

available in a wide array of settings, including office visits, clinic

services, home-based treatment programs, day treatment programs,

partial hospitalization (day hospital), therapeutic foster care

provided by trained ``parents,'' residential treatment facility

services, and acute psychiatric hospital care.

Mental health professionals generally agree that it is best for the

individual for services to be provided in the least restrictive setting

possible. In addition, it is usually cost effective to do so. ``Least

restrictive setting'' generally means that needed care should be

provided on an outpatient basis in the community where the individual

lives, as opposed to in an inpatient setting. This principle has been

codified in Part B of the Education of the Handicapped Act, Public Law

94-142 (20 U.S.C. 1400 et seq.).

The Medicaid program has frequently been criticized for favoring

institutional care over community-based care because the reimbursement

rates are often viewed as being more adequate for inpatient care, and

because eligibility may be more readily available for institutionalized

individuals. As a result, institutional care may have been provided

when it was not medically necessary, with possible detrimental effects

on the patient, because alternative community care was not available.

Various studies have estimated that from 39 to 95 percent of the

psychiatric inpatient care provided is medically unnecessary. In fact,

a wide array of outpatient mental health services can be funded under

Medicaid, but for a variety of reasons these options have not been

fully utilized by many States and outpatient providers.

In recent years, however, many States have become concerned about

dramatic increases in Medicaid expenditures for inpatient psychiatric

care and have sought to assure that alternative care is available in

the community. Many States have moved to increase funding for community

services and instituted effective screening procedures for inpatient

admissions. We are proposing revisions in Sec. 441.152, concerning

certification of the need for inpatient care, that we believe will

serve to support these efforts. These proposals are discussed in

section V of this preamble.

Inpatient Settings

As discussed in Section II Statutory and Regulatory History of this

preamble, existing regulations allow the provision of psychiatric

inpatient care for individuals under age 21 in any psychiatric facility

that is accredited by the Joint Commission and meets the other

requirements in subpart D of 42 CFR part 441. The Joint Commission

accredits a wide variety of health care organizations which may provide

inpatient or outpatient services. Inpatient psychiatric services are

currently being provided for individuals under age 21 in psychiatric

hospitals in all but 7 States. Psychiatric hospitals must, under

section 1905(h)(1)(A), meet the Medicare definition of ``psychiatric

hospital'' contained in section 1861(f) of the Act. The regulatory

requirements relating to psychiatric hospitals are specified in

Sec. 482.60, Special provisions applying to psychiatric hospitals.

In addition, 14 States provide inpatient psychiatric services for

individuals under age 21 in psychiatric units in general hospitals.

Three States cover the psychiatric\21 benefit in nursing facilities,

and 19 States cover this benefit in facilities called ``residential

treatment facilities.''

Although nursing facilities (NFs) are a recognized category of

inpatient provider, we decided against designating NFs as an

alternative setting for the psychiatric\21 benefit because NFs are

primarily designed to provide geriatric nursing care and would not

generally be appropriate for children and adolescents.

In view of the fact that a number of States no longer use

psychiatric hospitals to provide services to individuals under age 21

and a significant number of States now provide this inpatient benefit

in psychiatric units of general hospitals, we propose to specify in the

proposed regulations that States may use psychiatric units of general

hospitals to provide acute psychiatric inpatient care under the

psychiatric\21 benefit either instead of, or in addition to,

psychiatric hospitals.

We propose to revise existing regulations to establish a definition

of the term ``psychiatric residential treatment facility'' (PRTF) and

conditions of participation for this type of facility. A PRTF is a

community-based facility that provides a less medically intensive

program of treatment than a psychiatric hospital or a psychiatric unit

of a general hospital.

The proposed PRTF standards are based on existing standards for

these facilities developed by CHAMPUS, the Joint Commission, and a

number of States and other organizations. We have tried to structure

the PRTF conditions of participation to ensure practical outcome-

oriented benefit to patients, rather than establishing ``paper''

compliance with procedures and policies.

We also would revise Sec. 441.152, which specifies the requirements

for certification of the need for admission to all psychiatric\21

providers. These provisions are discussed in detail in section V of

this preamble.

Any State that chooses to offer the psychiatric\21 benefit would be

required, at a minimum, to provide acute psychiatric care in a

psychiatric hospital or a psychiatric unit of a general hospital.

States would have the further option of also providing inpatient

psychiatric services in the freestanding PRTF setting. If a State does

not choose to include PRTF services as part of the psychiatric\21

benefit, it would not be required to certify freestanding PRTFs if it

determines that medically necessary residential treatment services for

EPSDT patients can be provided in a certified distinct part PRTF

located in a general hospital or psychiatric hospital setting.

PRTFs would provide a type of care that is distinctly different

from the care provided by acute care facilities and therefore a PRTF

that is affiliated with a participating psychiatric hospital or general

hospital would need to obtain separate PRTF certification in addition

to its hospital certification. The setting(s) that a State chooses to

use for the psychiatric\21 benefit would be indicated in its State

plan.

PRTFs would be certified in the same manner as other inpatient

providers of Medicaid services. States may contract for specialized

personnel to perform surveys if they wish to.

Currently operating residential treatment facilities include a wide

range of providers, from facilities that provide care similar to that

provided in psychiatric hospitals to facilities that are more similar

to group homes. In addition, many residential treatment facilities are

part of multi-service mental health organizations which also provide a

range of outpatient services. A number of States have developed or are

in the process of developing licensure requirements for these

facilities.

Treatment in residential treatment facilities generally costs less

per day than treatment in a psychiatric hospital, but because the

length of stay in residential facilities is generally longer, treatment

in a residential facility is not always less expensive for the total

inpatient stay. Rates for residential treatment facility services now

range from approximately $140 to $420 per day, including professional

fees.

Some States have developed managed care systems for mental health

services and, in some cases, States have combined Medicaid funding for

these mental health benefits with funding for related services

administered by other agencies in the State. These arrangements tend to

ensure that treatment programs are developed in response to the

individual's service needs rather than being structured according to

the funding criteria of various programs; we support these coordinated

efforts. Under these programs, Medicaid is only billed for Medicaid

covered services provided to Medicaid eligible individuals.

In the course of developing these proposed regulations, several

parties suggested that intensive outpatient services be included as a

subcategory of services under the psychiatric\21 benefit in order to

emphasize that outpatient services can often be substituted for

inpatient care, with less traumatic impact on the patient. Although we

support the goal of substituting outpatient services for inpatient

services whenever possible, the statutory language of section 1905(h)

of the Act authorizing this inpatient benefit does not provide latitude

for including outpatient services; this benefit must be provided in ``a

psychiatric hospital * * * or in another inpatient setting.'' We

believe, however, that the system we have proposed for assessing the

total needs of each child or adolescent will support the goal of

assuring that outpatient services are used whenever this is a feasible

alternative.

It was also suggested that we consider allowing children and

adolescents who do not require inpatient treatment of their mental

conditions to enter residential facilities if they require residential

placement to remove them from a problematic family setting. In this

situation, it was suggested that Medicaid would fund the treatment

services, and payment for the cost of room and board would come from

other sources. While we recognize that this type of arrangement may be

necessary in some circumstances, and we acknowledge that rehabilitative

services can be provided in a wide variety of settings, we note that

care provided under such an arrangement would not be provided in the

context of the psychiatric\21 benefit, which is restricted by statute

to individuals who require inpatient care for treatment of their mental

condition (section 1905(h)(1)(B)). Accordingly, we have not

incorporated this suggestion into the proposed regulations.

V. Provisions of the Proposed Regulations

A. Inpatient Mental Health Provisions

We would establish a new Sec. 441.45, Mental health assessment and

service plan, which implements section 1902(a)(26) of the Act. This

section requires individual plans of care for psychiatric inpatients

and periodic medical review in each psychiatric institution. The State

would be required to ensure that a comprehensive assessment is made

(Sec. 441.45(a)) and that an individual comprehensive services plan

(Sec. 441.45(b)) is developed for each individual who has been

determined to be at risk of requiring inpatient mental health

treatment. We propose to extend this requirement to include not only

eligible individuals currently receiving inpatient mental hospital

services, but also certain eligible individuals who the State

reasonably believes may imminently need such services, because we

believe that such a requirement is a necessary safeguard to ensure

proper utilization of inpatient services. We also believe that such a

requirement will help to ensure continuity of care and appropriate

service utilization for patients who have had intermittent inpatient

mental hospital services. Furthermore, such a requirement is consistent

with requirements for comprehensive assessments of medical status and

needs under the early and periodic screening, diagnosis and treatment

benefit available to individuals under the age of 21.

A State must consider at risk of requiring inpatient mental health

services at least those eligible individuals who are in the following

categories: those who are applicants for inpatient mental health

facilities, those determined to need inpatient mental health services

on an EPSDT screen or preadmission screening and annual resident review

(PASARR), and those discharged from an inpatient mental health

facility, during the year following discharge. A State may include

other groups of eligible individuals who it believes are at risk of

needing inpatient treatment in the near future. For eligible

individuals who have been identified based on an EPSDT screen or a

PASARR, a State may adopt as its assessment or comprehensive service

plan the results of these other reviews if those reviews are sufficient

to meet the requirements specified in Sec. 441.45.

Comprehensive mental health planning for a child or adolescent

would typically involve representatives from the State mental health

department, the child welfare authority, the educational/vocational

services agency, the public health department, and in some cases the

alcohol/drug treatment agency, and/or the juvenile justice system. The

Medicaid agency would participate with these agencies in determining

the proportionate share of funding responsibility for the services

needed under the plan. The child or adolescent and the parents or

guardians would also be involved in developing the services plan, and

parents or guardians must also be involved in any treatment provided in

order to ensure maximum long term benefit from the treatment.

We would revise Sec. 441.106, Comprehensive mental health program,

which implements the statutory requirement for a comprehensive mental

health program, to reflect the statutory provisions more explicitly.

The revision of this section, consistent with sections 1902 (a)(20) and

(a)(21) of the Act, would require that each State's comprehensive

mental health program involve all agencies in the State that serve

mentally ill individuals.

Medicaid's statutory authority for requiring a comprehensive mental

health program applies to all States offering services for individuals

age 65 and over in institutions for mental diseases (currently 46

States) and our regulations at Sec. 441.106 have long required that the

comprehensive program cover all ages. Section 1912 of the Public Health

Service Act includes a similar mental health planning provision and we

would specify that any program developed as a result of that

requirement would meet the Medicaid requirement.

An annual progress report on the State's comprehensive mental

health program is required under existing Sec. 441.106(c). We would

move this requirement to Sec. 441.106(b), and modify it to specify that

a comprehensive mental health services plan developed under section

1912 of the Public Health Service Act would satisfy the Medicaid

reporting requirement. If a separate report is prepared, the

interagency group involved in mental health planning would participate

in the report preparation. The revision would also specify that the

report must be submitted to the HCFA Regional Administrator within 3

months after the end of the fiscal year.

In Sec. 441.151, General requirements, a new paragraph (c) would be

added to require that services provided to an individual under the

psychiatric\21 benefit must be compatible with the individual's

comprehensive services plan developed as specified in Sec. 441.45(b)

(discussed above).

We also would delete the existing regulatory requirement for Joint

Commission accreditation in Sec. 441.151(b). As discussed in section II

of this preamble, this requirement was removed from the law in 1984 and

the Joint Commission has indicated that it does not wish to have its

accreditation mandated in HCFA regulations since accreditation is

voluntary.

We would require that psychiatric facilities meet either the

psychiatric hospital requirements specified in existing Sec. 482.60 and

proposed Sec. 483.202, or operate as an inpatient psychiatric unit in a

general hospital that meets the requirements of existing subparts B and

C of part 482 and proposed Sec. 483.202, or meet the psychiatric

residential treatment facility conditions of participation that we are

proposing in Secs. 483.210 through 483.224 of the new subpart F of part

483. To summarize, all providers of the psychiatric\21 benefit would be

required to meet the condition of participation in Sec. 483.202

relating to active treatment and the inpatient plan of treatment, in

addition to meeting the other regulatory requirements applicable to the

particular setting.

In addition to meeting the PRTF requirements specified in these

proposed regulations, as determined by the survey process, a State

could also require Joint Commission accreditation or accreditation by

any other accrediting organization determined appropriate by the State

if it wishes to. The regulations at 42 CFR 431.51(c)(2) allow States to

establish reasonable standards relating to qualifications of providers.

We emphasize that accreditation by an organization would not, however,

be considered a substitute for meeting the regulatory requirements in

the proposed new subpart F of part 483. Reliance on varied and changing

accreditation requirements in the past has led to widespread confusion

about the requirements providers must meet as Medicaid participants.

We propose to modify the certification requirements in

Sec. 441.152, Certification of need for services, by adding a

requirement that the team or organization responsible for certifying

the need for care must complete a comprehensive assessment as specified

in Sec. 441.45(a) prior to determining whether inpatient care is

necessary.

In addition, we would require that the certification include the

documented clinical evidence that serves as the basis for the

certification. We wish to make it clear that certification of the need

for inpatient care is not to be made unless inpatient care is medically

necessary for treatment of the child or adolescent, as required by the

statute. Section 1905(h)(1)(B) of the Act requires that ``physicians

and other personnel qualified to make determinations with respect to

mental health conditions and the treatment thereof'' certify the need

for care which they have determined to be ``necessary on an inpatient

basis and can reasonably be expected to improve the condition, by

reason of which such services are necessary, to the extent that

eventually such inpatient services will no longer be necessary.''

For this reason, we propose to delete the requirement in existing

Sec. 441.152(a)(1) that the certification include a statement that the

ambulatory care resources available in the community do not meet the

treatment needs of the recipient. This ``availability of ambulatory

care'' requirement was designed to supplement the certification of the

medical necessity for inpatient care. However, we are concerned that

this requirement may have been misinterpreted as forming a basis for

certifying that inpatient care was needed when, in fact, it was not

clinically required. Inpatient care may have been incorrectly certified

to be necessary only because the community services that would have

been sufficient and preferable for that individual were not available

in his or her community.

Given the above circumstances, the current reference to ambulatory

services may have contributed to the inappropriately high incidence of

unnecessary inpatient care. HCFA believes that if the need for

inpatient care is certified on the basis that ambulatory care is

unavailable, this action would undermine an important impetus to

developing needed community services.

The proposed certification statement would have to indicate which

category of inpatient services are needed, i.e., acute psychiatric

services or PRTF services.

The State Medicaid agency needs to ensure that the teams that

develop the individual comprehensive services plans and assess the need

for inpatient care are prepared to confer informally on a timely basis

so that decisions concerning possible inpatient admissions can be made

in times of crisis. Special procedures would be established for

emergency admissions under the psychiatric\21 benefit to psychiatric

hospitals or inpatient units of general hospitals, as specified in

Sec. 441.152(c). Continued coordination and case management are vital

in assuring that needed educational/vocational services are available

in the community since these services are often critical in

forestalling the need for repeated inpatient mental health treatment.

If a Medicaid eligible patient requires an emergency admission to a

psychiatric hospital or psychiatric inpatient unit of a general

hospital, we would require that hospital staff assess the patient's

condition and certify the need for inpatient care and then initiate

appropriate treatment as soon as possible following admission. If an

individual does not apply for Medicaid until after admission, the

assessment and certification of the need for inpatient care would be

made by hospital or facility staff within 7 days following the

application for Medicaid.

The formal inpatient plan of treatment developed in accordance with

proposed Sec. 483.202(b) would have to be implemented within 7 days

following admission or application for Medicaid if the individual

remains in the hospital that long. The inpatient plan would need to be

compatible with the individual's comprehensive services plan developed

as specified in Sec. 441.45(b).

No emergency admissions would be allowed for psychiatric

residential treatment facilities (PRTFs). PRTFs provide less medically

intensive and less extensive services than psychiatric hospitals or

psychiatric units of general hospitals and are not generally equipped

or staffed to deal with acute situations; if an acute situation arises

during a PRTF stay, the patient would generally need to be transferred

to an acute care facility.

We would revise Sec. 441.153, Team certifying need for services,

concerning the team that makes the certification that inpatient care is

necessary, by deleting the requirement that different types of teams

make the certification depending on when the individual becomes

eligible for Medicaid. We instead propose that, whenever possible, the

certification would be made by a team composed of representatives of

the agencies providing services to the individual in order to ensure

that these services are coordinated and that all possible alternatives

to inpatient care are considered.

The stress placed on interdisciplinary planning in this regulation

is based on the premise that inpatient psychiatric services should be

used only when medically necessary, and that those who are responsible

for provision of all services to mentally ill individuals will arrange

services in the individual's best interest, and arrange for services in

the community whenever possible. When inpatient psychiatric care is

provided, the stay should be as brief as possible, and focused on

improving the individual's condition as quickly as possible to the

point that he or she can be maintained with community-based services.

Although it may be difficult to arrange for the necessary interagency

coordination in States that have not already developed a coordinated

approach, it is counterproductive to provide services in a fragmented

manner that does not recognize the total service needs of the child or

adolescent. Even when a State is not able to utilize interagency teams

for certification of the need for inpatient care upon the effective

date of this regulation, we expect that all States will move toward

improving coordination of interrelated services.

If inpatient psychiatric care is determined to be necessary, an

interdisciplinary approach would also ensure that all service providers

are aware of the need to arrange for or to accommodate service delivery

in the new setting. The school system, for example, will need to

arrange for or coordinate the provision of educational services in the

inpatient setting. We would not require that team members meet in

person to discuss cases if they find it more convenient to communicate

via a teleconference or other means.

We would retain the regulatory requirement for physician

participation in the certification process (Sec. 441.153(c)(1)),

consistent with section 1905(h) of the Act, which requires that the

team certifying the need for care include a physician. The physician

may be a representative of one of the service agencies.

The team members must generally be independent, i.e., they may not

be employees of the inpatient facility being considered for admission

of the individual. If the inpatient facility is a public facility, an

individual who is employed by the governmental component responsible

for administration of the inpatient facility would not be considered

independent. If inpatient care is required on an emergency basis,

however, or the individual applied for Medicaid after admission,

certification may be made by employees of the inpatient facility.

In some States, it may not currently be feasible to use service

agency representatives to form the review team. HCFA plans to provide

guidance on this issue in the State Medicaid Manual. In such

circumstances, the State would need to arrange for another type of

review group. The State could establish its own review teams or

contract with an independent review organization to determine whether

admissions are necessary. An organization's team would need to meet any

State registration requirements and would have to have physician

participation in the determination of the necessity of inpatient

psychiatric services, as required by statute. These teams or

organizations would also be required to be aware of and consider the

total service needs of each individual (Sec. 441.153).

The rules in Secs. 441.154 and 441.155 concerning ``active

treatment'' and ``plan of care'' would be revised and incorporated into

the rules concerning conditions of participation at Sec. 483.202. We

believe that it is important to incorporate these critical requirements

into a condition of participation so that they will be subject to

survey procedures. These requirements are discussed in a later section

of this preamble.

Section 441.156, Team developing individual plan of care, would be

deleted. The process for developing the inpatient plan of treatment

would be specified in Sec. 483.202(b), Active treatment program.

A new Sec. 441.158, Care settings, would be added to describe the

settings to be used for providing this inpatient benefit. One setting

is a psychiatric hospital, the setting that has been authorized under

the statute since the psychiatric\21 benefit was first established. We

would specify psychiatric units in general hospitals as a second

setting that States can use to provide acute care. Acute psychiatric

care could be provided in either of these settings when the need for

such care is certified as specified in Sec. 441.152. These settings

would be used when an individual has an episode for which acute care is

required, and when it is determined that this most restrictive type of

care is necessary to stabilize the patient's acute condition.

A third possible setting for the psychiatric\21 benefit would be a

PRTF. The PRTF would be a new category of institutional provider under

the Medicaid program and would be limited to the provision of the

psychiatric\21 benefit under section 1905(a)(16) of the Act. PRTFs

would provide care when an individual does not require acute care, but

does require supervision and active treatment on a 24-hour inpatient

basis to attain a level of functioning that allows subsequent treatment

in a less restrictive setting.

The PRTF setting is being specified as a new category of Medicaid

provider in order to establish an alternative inpatient setting which

provides care more similar to community-based care than the care

provided in psychiatric hospitals or general hospitals. To ensure that

PRTFs are community-oriented, we propose to require that these

facilities coordinate their educational activities with school

curricula in their communities (Sec. 483.212(a)(3)). In developing this

proposed rule we considered the possibility of limiting the size of

facilities to 30 or fewer beds in order to enable the facilities to be

more appropriate in a community setting, but we are not including a

proposed limit in the proposed rule. We nevertheless welcome comments

and suggestions on this subject.

The certification of need process for PRTF care is described in

Sec. 441.152 (a) and (b). We are proposing to establish the

requirements for PRTFs in Secs. 483.210 through 483.224 of the

regulations in subpart F of part 483.

The PRTF would be an additional optional setting for States that

choose to provide this inpatient benefit. States that do not include

PRTFs as providers under the psychiatric\21 benefit would still have to

provide this type of care when determined to be necessary by an EPSDT

screen. If such a State does not have freestanding PRTFs, a section of

a general hospital or psychiatric hospital that has been certified as a

PRTF can provide these residential services.

Any State that elects to provide the psychiatric\21 benefit would

be required, at a minimum, to provide these services in a psychiatric

hospital or in a psychiatric unit in a general hospital and to have

PRTF services available at least when required under EPSDT.

The maintenance of effort provision in section 1905(h)(2) of the

Act is implemented in Sec. 441.180 of the regulations. The Medicaid

statute provides that a State's maintenance of effort computation,

which would demonstrate that the State continues to provide the same

level of funding for these services that it did before it began to

receive FFP, is to be based on data from 1971, the year before this

provision was enacted. We recognize that the statute is obsolete in

this regard and we have requested a technical amendment to update this

provision, but the current regulatory maintenance of effort requirement

must remain in effect until a statutory amendment is enacted. It is not

necessary, however, for States that currently offer the psychiatric\21

benefit to again demonstrate maintenance of effort if they wish to

modify the State plan option to include PRTFs and/or hospital

psychiatric units as providers of the psychiatric\21 benefit.

We would add a new Sec. 441.160, Payment, that would specify the

condition of payment for the psychiatric\21 benefit. For payment

purposes, we propose to add PRTF services to the long-term care

facility services definition in Sec. 447.251(c). In addition, we

propose to apply the payment principles specified in Sec. 447.250 (a)

through (c) to all providers of the psychiatric\21 benefit.

B. Requirements for Participation for Facilities

We propose to establish standards in subpart F of part 483 for all

facilities and units that wish to participate in Medicaid as providers

of the psychiatric\21 benefit.

The proposed requirements relating to active treatment and the

inpatient plan of treatment would apply to psychiatric hospitals and

psychiatric units in general hospitals that provide the psychiatric\21

benefit, as well as to PRTFs. In Sec. 483.202, Active treatment

program, we propose to require that the facility provide treatment

designed to enable the individual to achieve sufficient stability to

progress to outpatient care, and to attain the objectives specified in

the inpatient plan of treatment that would be required in

Sec. 483.202(b).

Section 483.202(b), Inpatient plan of treatment, would require that

an interdisciplinary team, which includes a facility staff physician

and at least one other professional staff person, develop the inpatient

plan of treatment which specifies the interventions to be provided for

the individual. We would require that the inpatient treatment plan

include specific measurable treatment objectives and timeframes for

meeting these objectives. In addition, we would require that inpatient

mental health services be coordinated with any other services being

provided under the individual's comprehensive services plan.

The interval for review of inpatient care by the review team in

acute care psychiatric\21 providers would be set at 7 days after

admission and every 7 days thereafter. In a PRTF, reviews would be

required every 7 days in the initial month of stay; after the first

month, reviews would be required at monthly intervals. We do not

believe that longer periods should elapse before the treatment

modalities being used are assessed for their effectiveness. Any

necessary changes should be made as soon as possible in order to make

certain that discharge occurs at the earliest possible time.

C. PRTF Conditions of Participation

In developing the proposed requirements for PRTFs, we have tried to

allow flexibility for providers whenever possible, and to avoid

requiring specific documentation of administrative procedures. We

recognize that policies and procedures relating to such matters as

personnel and admissions are generally necessary but we believe that

facilities that can meet the requirements specified in this proposed

rule can develop these administrative procedures without additional

Federal requirements. We have made an effort to minimize the imposition

of any paperwork burdens.

Facilities meeting all the requirements in subpart F of part 483

would be qualified as PRTFs to provide the psychiatric\21 benefit. We

would require that facilities protect and promote the rights of each

resident, as specified in Sec. 483.211, Resident rights.

We would require that these providers meet applicable licensure

laws in States that have established licensure requirements for this

type of facility. This requirement would be specified in

Sec. 483.212(a)(1), Licensure and other laws. Because it is important

that the children and adolescents in the facility maintain their

educational development while they are in the facility, we would

require in Sec. 483.212(a)(2) that the facility coordinate its

educational activities with school curricula in the community.

We would specify at Sec. 483.212(a)(3) that providers would be

expected to meet the regulations issued by the Department of Health and

Human Services relating to nondiscrimination, protection of human

subjects, and fraud and abuse, as specified in 45 CFR parts 46, 80, and

84 and 42 CFR part 455. The disclosure of ownership and control

requirements in section 1126 of the Act would be applicable to these

providers. The requirements for provider agreements under section

1902(a)(27) of the Act would also be applicable.

We would also require that PRTFs have a governing body which would

appoint an administrator to be responsible for the general management

of the facility. These requirements would be specified in

Sec. 483.212(b), Administrative structure. There would be a general

requirement relating to competence, academic credentials, and

administrative experience. We invite comments on whether these

requirements should be more specific, and if so, what the requirements

should be.

We propose to require that the facility designate a clinical

director who is at least board-eligible in psychiatry and has

experience in child and adolescent mental health. The clinical director

would be responsible for the implementation of each resident's

inpatient treatment plan and for the coordination of all medical/

psychiatric care in the facility.

We would require that all facilities have written procedures to use

for all potential emergencies, such as fire, severe weather, and

missing residents (proposed Sec. 483.218(b)). New employees would be

trained in these procedures and all staff would participate in review

drills.

The facility would be required to have written transfer agreements

with one or more hospitals which assure that a resident can be

transferred to an appropriate setting in a timely manner when transfer

is necessary for more intensive psychiatric care or for medical

treatment (proposed Sec. 483.220(a)). Necessary information relating to

the resident's care would be exchanged at the time of transfer.

The facility would also be required to have an effective program

for infection control (proposed Sec. 483.218(c)).

Each resident's dignity would be respected and facilities would be

precluded in Sec. 483.216, Facility practices and resident behavior,

from imposing any physical restraints or administering any psychoactive

drugs for purposes of discipline or convenience. All forms of abuse

would be forbidden, including verbal, mental, sexual, and physical

abuse. Any grouping of residents would be planned to protect the safety

and promote the treatment of all group members. The facility would be

required to report any alleged abuses to the administrator or to other

officials in accordance with State law. Facilities would have to retain

evidence of a thorough investigation.

Concerning staff qualifications, we would require in

Sec. 483.214(b) that the facility employ the professional,

administrative and support staff necessary to implement the inpatient

plans of treatment and to carry out the applicable regulatory

requirements. Professional staff could include qualified psychiatrists

and other physicians, clinical psychologists, psychiatric nurses,

social workers, substance abuse specialists, other health professionals

and ancillary staff. We would require that all staff be competent and

that professional staff be appropriately licensed, certified, or

registered when this is required under State law. We would further

require that professional staff not be under sanctions imposed for

infractions as specified in sections 1156, 1128, or 1892 of the Act.

Services provided by nonemployees would be subject to a written

agreement that specifies the facility's and contractor's

responsibilities. We invite comments as to whether this section should

contain more specific requirements concerning personnel qualifications.

We would require that responsible direct care staff be on duty and

awake on a 24-hour basis to take prompt action in case of injury,

illness, fire, or other emergency in a facility housing residents who

are aggressive, assaultive, or security risks (Sec. 483.214(a)).

The facility would be required to maintain clinical records on each

resident and retain the records for at least 5 years or any period of

time required by State law. The material in the records would remain

confidential except under specified circumstances (Sec. 483.212(d)).

We would also require that facilities disclose ownership and

control in accordance with Sec. 455.104 (Sec. 483.212(c)). A facility

would also have to notify the Medicaid agency within 5 days if there is

a change in the facility's ownership or administrator or clinical

director.

A facility would be required to maintain a quality assurance

program which monitors care provided in the facility and to cooperate

with an authorized program of independent medical evaluation, including

evaluation of each resident's need for facility care (proposed

Sec. 483.212(e)). PRTFs would be one type of psychiatric facility, and

would therefore be subject to the ``inspection of care'' provisions

specified in subpart I of 42 CFR part 456.

Section 483.218, Safety provisions, contains the provisions we

propose to ensure general resident safety. We propose to require that

PRTFs meet the applicable provisions of the Life Safety Code of the

National Fire Protection Association (Sec. 483.218(a)). If these code

provisions would result in unreasonable hardship upon facilities

classified for health care occupancy only, they could be waived by the

State survey agency, but only if the waiver does not adversely affect

the health and safety of residents or staff.

Refuse, including any toxic wastes generated in the facility, would

have to be disposed of in accordance with applicable Federal, State,

and local laws (Sec. 483.218(d)).

PRTFs would be required in Sec. 483.222, Dietary services, to

provide dietary services that ensure that each resident receives a diet

that meets the daily nutritional needs of the resident. If a qualified

dietitian is not employed on a full time basis, the facility would be

required to designate a person to serve as the director of food

service. The regulation would require menu planning, and sanitary food

storage, preparation, and distribution methods.

We would require that facilities provide sufficient space in the

dining and program areas to enable staff to provide the services

specified in each resident's inpatient plan of treatment

(Sec. 483.224(a)). Residents' bedrooms would be required to accommodate

no more than four residents, and to measure at least 80 square feet per

resident in multiple resident bedrooms and at least 100 square feet in

single resident rooms (Sec. 483.224(b)). Variations in these

accommodation and size requirements could be allowed in individual

cases when a physician providing direct care documents that the

variations are required by special needs of residents and will not

adversely affect residents' health and safety.

Bedrooms would have to have direct access to a corridor and to have

at least one window. Appropriate beds, bedding and furniture, and

accessible closet space would be required. Each resident room would

need to be equipped with or located near toilet and bathing facilities.

Dining and activities rooms would have to be well lighted and

ventilated, with nonsmoking areas identified if smoking is allowed in

the facility. It is possible that, in the future, State and Federal

laws may prohibit smoking in these facilities. The facility would have

to ensure that there is a sanitary and orderly interior, including

clean bath and bed linens.

The facility would be required to establish procedures to ensure

that water is available to essential areas when there is a loss of

normal water supply. Comfortable temperature and sound levels would

have to be maintained, and adequate ventilation would be required. The

facility would have to maintain an effective pest control program.

We believe that our proposed facility standards are reasonable and

adequate for residential treatment facilities. We welcome comments and

recommendations for modifications of these proposed requirements from

the general public and especially from those who have had experience in

providing these services and from residents and families of residents.

D. Technical Revision

General provisions relating to Medicaid services are included in 42

CFR part 440. Section 440.160, Inpatient psychiatric services for

individuals under age 21, currently contains an abbreviated definition

of the psychiatric\21 benefit. This abbreviated definition has caused

confusion because it does not make it clear that this benefit must

always be provided in a psychiatric facility. Therefore, we propose to

revise the definition in this section to list the three possible

settings and to cross refer to the detailed requirements in subpart D

of part 441 and subpart F of part 483.

VI. Collection of Information

Regulations at Sec. 441.152 contain collection of information

requirements that are subject to the Paperwork Reduction Act of 1980

(44 U.S.C. 3501 et seq.). The information collection requirements

concern resident information. The respondents who will provide the

information include physicians and medical personnel. Public reporting

burden for this collection of information is estimated to be 30 minutes

per respondent. A notice will be published in the Federal Register when

approval is obtained. Organizations and individuals desiring to submit

comments on the information collection and recordkeeping requirements

should direct them to the OMB official whose name appears in the

ADDRESSES section of this preamble.

VII. Response to Public Comments

Because of the large number of items of correspondence we normally

receive on a proposed rule, we are unable to acknowledge or respond to

them individually. However, we will consider all comments that we

receive by the date and time specified in the ``DATES'' section of this

preamble to the final rule.

VIII. Regulatory Impact Statement

We generally prepare a regulatory flexibility analysis that is

consistent with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601

through 612), unless the Secretary certifies that a proposed regulation

would not have a significant economic impact on a substantial number of

small entities. For purposes of the RFA, psychiatric residential

treatment facilities and psychiatric hospitals are considered to be

small entities. Individuals and States are not included in the

definition of small entity.

In addition, section 1102(b) of the Act requires the Secretary to

prepare a regulatory impact analysis for any final rule that may have a

significant impact on the operations of a substantial number of small

rural hospitals. Such analysis must conform to the provisions of

section 603 of the RFA. For purposes of section 1102(b) of the Act, we

define a small rural hospital as a hospital with fewer than 50 beds

located outside a Metropolitan Statistical area.

There are various aspects of this proposed regulation that might

have some cost or saving, but the net impact of all of them appears to

be negligible.

The establishment of the psychiatric residential treatment facility

as a new category of Medicaid facility for the purposes of inpatient

psychiatric care has varying impacts. On one hand, daily charges at

such facilities are projected to be lower than at psychiatric

hospitals. On the other hand, lengths of stay seem to be longer,

probably due to the less acute, more chronic nature of the conditions

they are designed to treat. However, if we assume that some recipients

are currently getting inappropriate care in more expensive settings

merely because of Medicaid regulations, then this regulation may save

some money. This assumption, though, is impossible to verify.

Also, there currently are many facilities that are not psychiatric

hospitals that are currently providing these services under existing

Medicaid regulations. It is not clear if their costs are higher than

the proposed residential treatment facilities. It is also unclear how

many of them will be able to qualify under the new regulations, and

what this will do to the supply of care and its cost.

In any event, it does not appear that more eligible individuals

will come into the program because of this regulation. Currently, there

are approximately 42,000 recipients of services under this category.

As for the implementation of requirements for comprehensive

programs and coordination of State authorities concerned with provision

of mental health services, as well as the requirements for coordinated

plans of care, they will probably increase administrative costs

somewhat, but will reduce program costs by ensuring that the most

appropriate and efficient form of care is utilized. The magnitude of

these costs and savings is difficult to determine but probably is

negligible, given the number of recipients involved.

For these reasons, we are not preparing analyses for either the RFA

or section 1102(b) of the Act since we have determined, and the

Secretary certifies, that this proposed rule would not result in a

significant economic impact on a substantial number of small entities

and would not have a significant impact on the operations of a

substantial number of small rural hospitals.

In accordance with the provisions of Executive Order 12866, this

proposed regulation was not reviewed by the Office of Management and

Budget.

List of Subjects

42 CFR Part 440

Grant programs--health, Medicaid.

42 CFR Part 441

Family planning, Grant programs--health, Infants and children,

Medicaid, Penalties, Reporting and recordkeeping requirements.

42 CFR Part 447

Standards for payment.

42 CFR Part 483

Requirements for States and long term care facilities.

42 CFR chapter IV would be amended as set forth below:

PART 440--SERVICES: GENERAL PROVISIONS

A. Part 440 is amended as follows:

1. The authority citation for part 440 continues to read as

follows:

Authority: Sec. 1102 of the Social Security Act (42 U.S.C.

1302).

2. Section 440.160 is revised to read as follows:

Sec. 440.160 Inpatient psychiatric services for individuals under age

21.

``Inpatient psychiatric services for individuals under age 21''

means services that--

(a) Meet the requirements in subpart D of part 441 of this

subchapter; and

(b) Are provided in facilities that meet the applicable

requirements specified in subpart F of part 483 of this chapter.

PART 441--SERVICES: REQUIREMENTS AND LIMITS APPLICABLE TO SPECIFIC

SERVICES

B. Part 441 is amended as set forth below:

1. The authority citation for part 441 continues to read as

follows:

Authority: Sec. 1102 of the Social Security Act (42 U.S.C.

1302).

2. A new Sec. 441.45 is added to read as follows:

Sec. 441.45 Mental health assessment and service plan.

(a) The State Medicaid agency must ensure that a comprehensive

assessment is made of each eligible individual who is determined by a

mental health professional to be at risk of requiring inpatient mental

health services in the near future.

(1) At a minimum, this group would include--

(i) Those who are applicants for inpatient mental health facility

services;

(ii) Those determined to need inpatient mental health services on

the basis of an EPSDT screen or PASARR; and

(iii) Those recently discharged from an inpatient mental health

facility (within the past year).

(2) A State may include other groups of eligible individuals who it

believes are at risk of needing inpatient treatment in the near future.

(3) The assessment must accurately identify the individual's

functional abilities and needs, and must take into account the

following information about the individual--

(i) Current diagnoses;

(ii) Prior medical and psychiatric history, including immunization

status;

(iii) Emotional and behavioral functional status;

(iv) Psychosocial status;

(v) Sensory and physical impairments;

(vi) Cognitive status; and

(vii) Any current drug therapy.

(4) The assessment must include a determination as to whether the

individual needs active treatment as defined in Sec. 483.202 of this

chapter.

(b) For each eligible individual who is determined to be at risk of

requiring inpatient mental health treatment, as specified in paragraph

(a) of this section, the State Medicaid agency must ensure that an

individual comprehensive services plan is developed, implemented, and

managed on an ongoing basis by a team composed of representatives from

all State/local agencies involved in providing care for that individual

or responsible for ensuring that needed care is provided.

(1) The individual must be included in the process of developing

the comprehensive services plan.

(2) If the individual is under age 18 or has been found by a court

to be incompetent, his or her parents or legal guardian must also be

involved.

(3) The team must be able to confer informally on a timely basis to

make decisions concerning possible inpatient admission in times of

crisis.

(c) The team that develops the comprehensive services plan must

monitor the plan's implementation to ensure that all services are

coordinated.

3. Section 441.106 is revised to read as follows:

Sec. 441.106 Comprehensive mental health program.

If the plan includes services for individuals age 65 and over in

institutions for mental diseases, the State must have a comprehensive

mental health program.

(a) The program must cover all ages, and include joint monitoring,

review and evaluation with State mental health, education, vocational

rehabilitation, criminal justice and social service representatives, of

the allocation and adequacy of mental health services within the State;

(b) The State Medicaid agency must prepare an annual progress

report, with participation by the other State agency representatives

described in paragraph (a) of this section.

(1) The State Medicaid agency must submit the annual progress

report to the HCFA Regional Administrator within 3 months after the end

of the fiscal year.

(2) The annual progress report must include a plan for improvements

to be made in the next year.

(3) The requirement for an annual progress report may be satisfied

by the development of a comprehensive mental health services plan which

meets the requirements of section 1912 of the Public Health Service

Act. A copy of the plan submitted to PHS must be submitted to the HCFA

Regional Administrator.

4. The title of subpart D is revised to read as follows:

Subpart D--Inpatient Psychiatric Services for Individuals Under Age

21

5. Section 441.150 is revised to read as follows:

Sec. 441.150 Basis and purpose.

This subpart specifies the applicable requirements if a State

elects to provide inpatient psychiatric services to individuals under

age 21, as authorized under sections 1905(a)(16) and 1905(h) of the

Act.

6. Section 441.151 is revised to read as follows:

Sec. 441.151 General requirements.

Inpatient psychiatric services for individuals under age 21 must

be--

(a) Provided under the direction of a physician who is at least

board eligible in psychiatry and has experience in child/adolescent

mental health;

(b) Provided in one or more of the care settings specified in

Sec. 441.158;

(c) Provided in accordance with an individual comprehensive

services plan required by Sec. 441.45(b);

(d) Provided before the individual reaches age 21 or, if the

individual was receiving the services immediately before the individual

reached age 21, before the earlier of the following--

(1) The date the individual no longer requires the services; or

(2) The date the individual reaches age 22; and

(e) Certified in writing to be necessary in the setting in which it

will be provided (or is being provided in emergency circumstances), in

accordance with Sec. 441.152.

7. In Sec. 441.152, paragraphs (a) and (b) are revised, and new

paragraphs (c) and (d) are added to read as follows:

Sec. 441.152 Certification of need for services.

(a) The team or organization specified in Sec. 441.153 must--

(1) Make the comprehensive assessment as required in Sec. 441.45(a)

before determining whether inpatient services are necessary; and

(2) If it is determined that inpatient benefits encompassed by this

benefit are necessary, certify in writing before the individual is

admitted that inpatient services are necessary for treatment of the

individual's condition. The certification must specify whether hospital

or psychiatric residential treatment facility services are required.

(b) The written certification must include:

(1) The clinical evidence that justifies the necessity for the

specified level of inpatient care; and

(2) The basis for determining that inpatient services will improve

the condition to the extent that these services will no longer be

necessary.

(c) If an admission must be made to a psychiatric hospital or

psychiatric unit of a hospital on an emergency basis because there is

imminent danger that the individual will do harm to himself or herself

or to another person, hospital staff must perform an assessment, a

hospital physician must certify the need for acute inpatient

psychiatric services, and the hospital must implement an initial

treatment plan. Hospital staff must also establish and implement the

inpatient treatment plan required in Sec. 483.202(b) of this chapter.

(d) The procedures specified in paragraph (c) of this section will

also be followed, within 7 days following the date of application, for

individuals who do not apply for medical assistance before admission.

8. Section 441.153 is revised to read as follows:

Sec. 441.153 Composition of certifying team or organization.

(a) The team that certifies the need for inpatient psychiatric care

as required under Sec. 441.152 (a) and (b) must--

(1) Include at least one physician who is at least board eligible

in psychiatry and has experience in the diagnosis and treatment of

mental illness in children or adolescents;

(2) Except as indicated in paragraph (b) of this section, include a

representative from each of the State and local agencies that are

providing services directly or are responsible for ensuring that needed

services are provided to the individual, such as educational/

vocational, social welfare, medical, psychiatric and juvenile justice

services; and

(3) Be composed of individuals who are not employed by the

inpatient facility being considered, or by the agency component

responsible for providing inpatient care, except as specified in

Sec. 441.152 (c) and (d).

(b) If an interagency team is not feasible, another team which

includes a physician, established by the State or an independent review

organization contracted by the State, may certify the need for

inpatient services if the organization meets any registration

requirements that the State may have for such organizations. This

alternative team must be aware of the complete array of service needs

of the individual.

(c) The certifying team or organization must involve the resident

and his or her parents or legal guardian in the determination process.

Sec. 441.154 [Reserved]

Sec. 441.155 [Reserved]

Sec. 441.156 [Reserved]

9. Sections 441.154, 441.155 and 441.156 are removed and reserved.

10. New Secs. 441.158 and 441.160 are added under subpart D to read

as follows:

Sec. 441.158 Care settings.

(a) Types of settings. Inpatient psychiatric services for

individuals under age 21--

(1) Must be provided in a psychiatric hospital that meets the

requirements of Secs. 482.60 and 483.202 of this chapter, or in a

psychiatric unit of a hospital that meets the requirements in subparts

B and C of part 482, and Sec. 483.202 of this chapter; and

(2) At the option of the State, may also be provided in a

psychiatric residential treatment facility that meets the requirements

in subpart F of part 483 of this chapter. All States must provide

psychiatric residential treatment facility care when it is required as

a result of an EPSDT screen.

(b) Limitations on provision of care. (1) Psychiatric hospital or

unit. Inpatient services in a psychiatric hospital or a psychiatric

unit of a hospital are provided for an individual who has a severe

acute episode of a psychiatric disorder which requires medical

supervision and treatment on a 24-hour-a-day basis. The services must

include intensive individualized treatment to stabilize the acute

condition so that the individual can be discharged as soon as possible

to a less restrictive type of care.

(2) Psychiatric residential treatment facility. Inpatient care in a

psychiatric residential treatment facility may be provided when an

individual does not require acute care but requires supervision and

treatment on a 24- hour-a-day basis to attain a level of functioning

that allows subsequent treatment on an outpatient basis.

Sec. 441.160 Payment.

Payment for inpatient psychiatric services for individuals under

age 21 must be made in accordance with the principles specified in

Sec. 447.250 (a) through (c) of this subchapter.

PART 447--PAYMENT FOR SERVICES

C. Part 447 is amended as follows:

1. The authority citation for part 447 continues to read as

follows:

Authority: Sec. 1102 of the Social Security Act (42 U.S.C.

1302).

2. Section 447.251 is amended by revising the definition of ``long-

term care facility services'' to read as follows:

Sec. 447.251 Definitions.

* * * * *

Long-term care facility services means intermediate care facility

services for the mentally retarded (ICF/MR), nursing facility (NF)

services, and psychiatric residential treatment facility (PRTF)

services.

* * * * *

PART 483--REQUIREMENTS FOR STATES AND LONG TERM CARE FACILITIES

E. Part 483 is amended as follows:

1. The authority citation for part 483 is revised to read as

follows:

Authority: Secs. 1102, 1819(a)-(f), 1905(c) and (d), and

1919(a)-(f) of the Social Security Act (42 U.S.C. 1302, 1395i-3(a)-

(f), 1396d(c) and (d), and 1396r(a)-(f)).

Subpart E--[Reserved]

2. Subpart E is removed and reserved.

3. A new subpart F containing Secs. 483.200 through 483.224 is

added to read as follows:

Subpart F--Conditions of Participation for Providers of Inpatient

Psychiatric Services for Individuals Under Age 21

Sec.

483.200 Basis and scope of subpart F.

483.202 Condition of participation: Active treatment program.

483.204 Requirements for psychiatric hospitals.

483.205 Requirements for psychiatric units of hospitals.

Conditions of Participation for Psychiatric Residential Treatment

Facilities

483.210 General requirements for psychiatric residential treatment

facilities.

483.212 Condition of participation: Administration.

483.214 Condition of participation: Facility staffing.

483.215 Condition of participation: Resident rights.

483.216 Condition of participation: Facility practices and resident

behavior.

483.218 Condition of participation: Safety provisions.

483.220 Condition of participation: Health services.

483.222 Condition of participation: Dietary services.

483.224 Condition of participation: Space and equipment.

Subpart F-- Conditions of Participation for Providers of Inpatient

Psychiatric Services for Individuals Under Age 21

Sec. 483.200 Basis and scope of subpart F.

(a) Basis. Section 1905(h) of the Act provides that the inpatient

psychiatric services benefit for individuals under age 21 includes

inpatient services which are provided in an institution (or distinct

part thereof) which is a psychiatric hospital as defined in section

1861(f) or in another inpatient setting that the Secretary has

specified in regulations. Section 1905(h) also specifies that a team of

physicians and other personnel qualified to make determinations about

mental health treatment must determine that inpatient care is necessary

for the individual; and that these services must--

(1) Involve active treatment that meets standards which may be

specified in regulations; and

(2) Reasonably be expected to improve the individual's condition to

the extent that inpatient psychiatric services will no longer be

necessary.

(b) Scope. This subpart contains the requirements that a facility

must meet in order to qualify as a Medicaid provider of psychiatric

inpatient services for individuals under age 21. These requirements

serve as the basis for survey activities for the purpose of determining

whether a facility meets the requirements for participation in

Medicaid. All providers of this benefit must also meet the requirements

in subpart D of part 441 of this chapter.

Sec. 483.202 Condition of participation: Active treatment program.

(a) Standard: Active treatment requirement. The inpatient provider

must ensure that each individual receives a continuous program of

individualized psychiatric treatment that is designed to enable the

individual to achieve sufficient stability to progress to outpatient

care, and to attain the treatment objectives specified in the inpatient

plan of treatment specified in paragraph (b) of this section. These

services must be consistent with implementation of the individual

comprehensive services plan required in Sec. 441.45(b) of this chapter.

(b) Standard: Inpatient plan of treatment. The inpatient provider

must--

(1) Ensure that an interdisciplinary team, including a facility

staff physician and at least one other professional staff person,

reviews the assessment data collected as specified in Sec. 441.45(a) of

this chapter, and updates the data as necessary. The team then

immediately initiates appropriate treatment.

(2) Ensure that within 7 days after admission, the team develops

the inpatient plan of treatment for each institutionalized individual

which specifies the interventions needed to improve the individual's

psychiatric condition to the extent that inpatient care is no longer

necessary. This general active treatment goal must be expressed in

terms of specific measurable treatment objectives for the individual,

and include the treatment modalities to be used and the target date by

which the individual will achieve each objective.

(3) Ensure that the plan includes an estimated discharge date and

post-discharge plans which specify the coordination required with the

family or guardian, and the school/vocational and community services

needed to ensure continuity of care.

(4) Ensure that the interdisciplinary team reviews inpatient

progress at least every 7 days, starting from the date of admission,

except that in PRTFs, after the first month, reviews must be done at

least once a month. During a review, the team must determine whether--

(i) Inpatient services continue to be required;

(ii) The stated objectives for attaining stabilization are being

achieved; and

(iii) Any changes are needed in the plan.

(5) Ensure that the individual's assessment is updated and that the

inpatient plan of treatment is revised as needed based on the results

of the progress reviews specified in paragraph (b)(4) of this section.

(6) Report results of the progress reviews to the team responsible

for the individual's comprehensive services plan (as specified in

Sec. 441.45(c) of this chapter) no later than the day following the

review.

(7) Provide that the development and review of the inpatient plan

of treatment specified in this section satisfies the utilization

control requirements for--

(i) Recertification under Secs. 456.60(b), 456.160(b), 456.260(b)

and 456.360(b) of this chapter; and

(ii) Establishment and periodic review of the plan of care under

Secs. 456.80, 456.100, 456.200 and 456.300 of this chapter.

Sec. 483.204 Requirements for psychiatric hospitals.

A psychiatric hospital providing the psychiatric inpatient benefit

for individuals under age 21 must meet the requirements specified in

Secs. 482.60 of this chapter and 483.202.

Sec. 483.205 Requirements for psychiatric units of hospitals.

A psychiatric unit of a hospital providing the psychiatric

inpatient benefit for individuals under age 21 must meet the

requirements specified in Sec. 483.202. The hospital must meet the

requirements specified in subparts B and C of part 482 of this chapter.

Conditions of Participation for Psychiatric Residential Treatment

Facilities

Sec. 483.210 General requirements for psychiatric residential

treatment facilities.

A psychiatric residential treatment facility providing the

psychiatric inpatient benefit for individuals under age 21 must meet

the requirements specified in Sec. 483.202, and 483.212 through

483.224.

Sec. 483.212 Condition of participation: Administration.

(a) Standard: Licensure and other laws. (1) When State or local law

requires licensure of this type of medical facility, the facility must

be licensed.

(2) The facility must coordinate its educational activities with

school curricula in the community.

(3) The facility must support and protect the fundamental human,

civil, constitutional, and statutory rights of each patient, and must

meet the applicable provisions of other HHS regulations, including but

not limited to those pertaining to nondiscrimination on the basis of

race, color, or national origin (as specified in 45 CFR part 80),

nondiscrimination on the basis of handicap (as specified in 45 CFR part

84), protection of human subjects of research (as specified in 45 CFR

part 46), and fraud and abuse (as specified in 42 CFR part 455).

Although these regulations are not considered requirements under this

part, violation may result in the termination or suspension of, or the

refusal to grant or continue payment of Federal funds.

(b) Standard: Administrative structure. (1) The facility must have

a governing body, or designated person(s) functioning as a governing

body, that is legally responsible for establishing and implementing

policies regarding the management and operation of the facility.

(2) The governing body must appoint an administrator who is

responsible for the general management of the facility. The

administrator must have appropriate academic credentials and

administrative experience in psychiatric treatment settings for

children and adolescents, and must be responsible for the fiscal and

administrative aspects of facility management as necessary to support

the facility's clinical program.

(3) The facility must designate as clinical director a physician

who is at least board-eligible in psychiatry and has experience in

providing child and adolescent mental health services. The clinical

director is responsible for the implementation of each resident's

clinical plan of care and for the coordination of all medical/

psychiatric care in the facility.

(c) Standard: Disclosure of ownership. The facility must comply

with the disclosure requirements of Sec. 455.105 of this chapter. The

facility must provide written notice to the State survey agency within

5 working days if a change occurs in--

(1) Persons with an ownership or control interest, as defined in

Sec. 455.101 of this chapter; or

(2) The facility's administrator or clinical director.

(d) Standard: Clinical records. The facility must develop and

maintain a separate clinical record on each resident in accordance with

professional standards. Records must be complete, accurate, accessible

and organized.

(1) Clinical records must be retained for the period of time

required by State law or 5 years from the date of discharge when there

is no requirement in State law.

(2) The facility must assure that the clinical record information

is not lost, destroyed, or put to unauthorized use.

(3) The facility must assure the confidentiality of all information

contained in the resident's record, except when release is required

by--

(i) Transfer to another health care institution;

(ii) State and/or Federal law;

(iii) Third party contract; or

(iv) The resident.

(4) The clinical record must contain information which identifies

the resident, documents the comprehensive assessment, the inpatient

plan of treatment, the services received, notes on progress toward the

objectives in the inpatient plan of treatment and any revision of the

plan of treatment made following review.

(e) Standard: Quality assurance. The facility must develop and

implement an ongoing quality assurance program to monitor and evaluate

the quality of patient care, pursue opportunities to improve care, and

correct identified problems.

(f) Standard: Independent medical evaluation. A facility must

cooperate with a medical evaluation and an inspection of care of

residents in the facility, including evaluation of each resident's need

for facility care when the evaluation has been authorized by State or

Federal government.

Sec. 483.214 Condition of participation: Facility staffing.

The facility must have enough competent and appropriately qualified

health care professional, administrative and support staff to provide

active treatment through implementation of the inpatient plan of

treatment for each resident and to carry out other facility

requirements. The facility is responsible for assuring that all

services are effective, timely, and meet the needs of residents.

(a) Standard: Staffing status. (1) In a facility that houses

residents who are aggressive, assaultive or security risks, responsible

direct care staff must be on duty and awake on a 24-hour basis to take

prompt action in case of injury, illness, fire or other emergency.

(2) In a facility that does not house residents who are aggressive,

assaultive or security risks, a responsible direct care staff person

must be on duty on a 24-hour basis, but need not remain awake when

residents are sleeping.

(3) If any resident is present in the facility, a direct care staff

person must be present. If all residents are away from the facility

during the day, a staff member must be available by telephone.

(b) Standard: Professional staff. Staff may include qualified

psychiatrists and other physicians, clinical psychologists, psychiatric

nurses, social workers, substance abuse specialists, and other health

care professionals and ancillary staff. When licensure, certification,

or registration is required under State law, professional staff must

meet these requirements. Professional staff must not be under a

sanction imposed in accordance with sections 1156, 1128, or 1892 of the

Act.

(c) Standard: Contracts. Any professional or other services that

are furnished to facility residents by persons who are not employed by

the facility must be furnished under a written contract that specifies

the contractor's responsibilities.

Sec. 483.215 Condition of participation: Resident rights.

A facility must protect and promote the rights of each resident,

with special consideration for residents who are emancipated and have

no parent or legal guardian, including each of the following rights:

(a) Access and visits. A resident has a right to see family members

and legal guardians and to have visitors from outside the facility.

(b) Consultation. The resident has the right to be consulted as

much as possible about his or her treatment.

(c) Complaints. The resident has the right to file complaints with

the facility administrator or with State officials concerning facility

conditions or treatment.

(d) Independent examination. The resident has a right to have

independent medical or psychological examination.

(e) Discharge planning. A resident has a right to participate in

his or her discharge planning.

Sec. 483.216 Condition of participation: Facility practices and

resident behavior.

Each resident's care must be provided in a manner that promotes and

maintains his or her dignity.

(a) Standard: Restraints. The facility may not impose any physical

restraints or administer any psychoactive drugs for purposes of

discipline or convenience. No restraints may be used which are not

required to treat the resident's psychiatric symptoms and specified in

the inpatient plan of treatment.

(b) Standard: Freedom from abuse. The resident has the right to be

free from verbal, sexual, physical and mental abuse, corporal

punishment and involuntary seclusion. The facility must develop written

policies that prohibit mistreatment, neglect, or abuse of residents and

ensure that the policies are implemented.

(1) The facility must--

(i) Not use verbal, mental, sexual or physical abuse, corporal

punishment, or involuntary seclusion; and

(ii) Not employ or contract with individuals who have a prior

employment or personal history of abusing, neglecting or mistreating

individuals, or have been found guilty of any of these acts in a court

of law.

(2) The facility must not house residents who have aggressive

tendencies, or may otherwise be dangerous, in close physical proximity

with vulnerable residents who are prone to be victimized. Any resident

grouping must be planned to protect the safety and promote the

treatment of all members of the group.

(3) The facility must ensure that all alleged violations involving

mistreatment, neglect or abuse, including injuries of unknown source,

are reported immediately to the administrator of the facility and to

any other officials specified in State law.

(4) The facility must have evidence that all alleged violations are

thoroughly investigated, and must take appropriate action to prevent

further abuse during the period of the investigation.

(5) The results of all investigations must be reported to the

administrator or to his or her designated representative and to other

officials in accordance with State law within 5 working days of the

report of the incident. If the alleged violation is verified, the

administrator must take appropriate corrective action.

(c) Standard: Drug therapy. The facility must not use drugs in

doses that interfere with the resident's daily living activities.

(1) When drugs are used for control of inappropriate behavior, they

must be used only as an integral part of the resident's plan of care

that is directed specifically toward the reduction of and eventual

elimination of the behaviors for which the drugs are employed.

(2) Drugs used for control of inappropriate behavior must not be

used unless it is evident that the harmful effects of the behavior

clearly outweigh the potentially harmful effects of the drugs.

(d) Standard: Resident work. The facility must ensure that

residents are not compelled to perform services for the facility. If a

resident chooses to perform work for the facility, compensation for the

services must be made at prevailing wage levels.

Sec. 483.218 Condition of participation: Safety provisions.

The facility must be designed, constructed, equipped, and

maintained to protect the health and safety of the residents. If a

circumstance develops that poses a significant threat to the health or

safety of facility residents, the facility must address the problem

immediately and promptly advise the State survey agency of the problem

and the action taken to remove the threat.

(a) Standard: Fire protection--(1) General. Except as provided in

paragraph (a)(2) of this section, the facility must meet the applicable

provisions of either the Health Care Occupancies Chapter or the

Residential Board and Care Occupancies Chapter of the Life Safety Code

(LSC) of the National Fire Protection Association, 1991 edition, which

is incorporated herein by reference.

(2) Exceptions. For facilities that meet the LSC definition of a

health care occupancy, the State survey agency may waive, for a period

considered appropriate, specific provisions of the LSC if--

(i) The waiver would not adversely affect the health and safety of

the residents; and

(ii) Rigid application of specific provisions would result in an

unreasonable hardship for the facility.

(b) Standard: Emergency procedures. The facility must develop and

implement written procedures to meet all potential emergencies, such as

fire, severe weather, and missing residents. The facility must train

all new employees in emergency procedures and periodically review the

procedures. All staff members must demonstrate ability to follow the

procedures. Staff emergency procedure drills must be held at least

quarterly on each shift.

(c) Standard: Infection control. The facility must implement an

infection control program which prevents, controls, and investigates

the development and transmission of communicable disease and infection.

This program must ensure that appropriate immunizations are done,

according to State law.

(1) When a resident needs isolation to prevent the spread of

infection, the facility must isolate the resident and, if necessary,

transfer the resident to a hospital for diagnostic testing.

(2) The facility must prohibit employees with symptoms or signs of

a communicable disease or infected skin lesions from direct contact

with residents or their food if direct contact will transmit the

disease.

(3) Personnel must handle, store, process, and transport linens so

as to prevent the spread of infection.

(d) Standard: Waste disposal. The facility must dispose of garbage

and refuse, including any toxic waste generated at the facility, in

accordance with Federal, State and local laws.

(e) Standard: Pest control. The facility must maintain an effective

pest control program so that the facility is free of pests and rodents.

(f) Standard: Systems. The facility must maintain all essential

mechanical, electrical, and other equipment in safe operating

condition.

Sec. 483.220 Condition of Participation: Health services.

(a) Standard: Hospital services. The facility must have a written

transfer agreement in effect with one or more hospitals approved for

participation under the Medicaid program that reasonably assures that--

(1) A resident will be transferred from the facility to the

hospital and admitted in a timely manner when transfer is medically

necessary for medical care or acute psychiatric care; and

(2) Medical and other information needed for care of the resident

will be exchanged between the institutions, including any information

needed to determine whether appropriate care can be provided in a less

restrictive setting.

(b) Standard: Medical services. Medical and emergency dental

services must be available to each resident 24 hours a day.

Sec. 483.222 Condition of participation: Dietary services.

Each resident must receive a nourishing, well-balanced diet that

meets the daily nutritional needs of the resident. Each resident must

receive a minimum of 3 meals daily.

(a) Standard: Dietitian. The facility must employ a qualified

dietitian on at least a part-time or consultant basis. If a qualified

dietitian is not employed on a full-time basis, the facility must

designate a person to serve as the director of food service.

(b) Standard: Menus. Menus must be prepared in advance and must be

followed.

(c) Standard: Nutrition. Each resident receives food that conserves

nutritive value, flavor and appearance; is palatable, attractive and at

the proper temperature, and is of sufficient quantity. Substitute food

of similar nutritive value must be offered to residents who refuse

standard food service.

(d) Standard: Food procedures. The facility must--

(1) Procure food from sources approved by Federal, State or local

authorities; and

(2) Store, prepare, distribute and serve food under sanitary

conditions.

Sec. 483.224 Condition of participation: Space and equipment.

(a) Standard: Dining and program areas. The facility must provide

sufficient space and equipment in dining and program areas to enable

staff to provide residents with needed services as identified in each

resident's plan of care. The facility must provide one or more rooms

designated for resident dining and activities. These rooms must--

(1) Be well lighted;

(2) Be well ventilated, with nonsmoking areas identified if smoking

is allowed in the facility;

(3) Be adequately furnished; and

(4) Have adequate space to accommodate all activities.

(b) Standard: Resident rooms. Resident rooms must be designed and

equipped for the comfort, dignity and privacy of residents.

(1) Bedrooms must--

(i) Accommodate no more than four residents;

(ii) Measure at least 80 square feet per resident in multiple

resident bedrooms and at least 100 square feet in single resident

rooms;

(iii) Have direct access to an exit corridor; and

(iv) Have at least one window to the outside. If the bedroom is

below grade level, the window must be usable as a second means of

escape by the resident occupying the room.

(2) The survey agency may grant a variance to the bedroom sizes

specified in paragraph (b)(1) of this section in individual cases when

a physician involved in direct patient care documents that the

variations are required by special needs of residents and will not

adversely affect the health and safety of residents.

(3) The facility must provide each resident with--

(i) A separate bed of proper size and height in the resident's

room;

(ii) A clean and comfortable mattress and clean bedding appropriate

to the weather and climate; and

(iii) Functional furniture appropriate to the resident's needs,

suitable storage space and individual closet space in the resident's

bedroom with clothes racks and shelves accessible to the resident.

(c) Standard: Toilet facilities. Each resident's room must be

equipped with or located near toilet and bathing facilities. The

facility must--

(1) Provide toilet and bathing facilities appropriate in number,

size and design to meet the needs of the residents; and

(2) Provide for individual privacy in toilets, bathtubs and

showers.

(d) Standard: Other environmental conditions. The facility must--

(1) Ensure a safe, clean, functional, comfortable and homelike

environment for residents and staff, including clean bath and bed

linens;

(2) Establish procedures to ensure that water is available to

essential areas when there is a loss of normal water supply;

(3) Maintain comfortable temperature levels;

(4) Maintain comfortable sound levels; and

(5) Have adequate outside ventilation by means of windows or

mechanical ventilation or a combination of the two.

Subpart G--[Reserved]

4. Subpart G is reserved.

Subpart H--[Reserved]

5. Subpart H is reserved.

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical

Assistance Program)

Dated: July 5, 1994.

Bruce C. Vladeck,

Administrator, Health Care Financing Administration.

Dated: October 24, 1994.

Donna E. Shalala,

Secretary.

[FR Doc. 94-28318 Filed 11-16-94; 8:45 am]

BILLING CODE 4120-01-P