Medicare and Medicaid Programs; Programs of All-Inclusive Care for the Elderly (PACE)
Federal RegisterNov 24, 1999
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SUMMARY: This rule establishes requirements for Programs of All-
inclusive Care for the Elderly (PACE) under Medicare and Medicaid.
These are pre-paid, capitated programs for beneficiaries who meet
special eligibility requirements and who elect to enroll. Programs must
apply for approval and are evaluated in terms of specific criteria.
Only a limited number of programs can be approved. Priority
consideration will be given to applicants that have been operating
under ongoing PACE demonstration projects.
DATES: Effective date: These regulations are effective on November 24,
1999. The incorporation by reference of the publication listed in the
rule was approved by the Director of the Federal Register as of
November 24, 1999.
Comment date: Comments will be considered if we receive them at the
appropriate address, as provided below, no later than 5 p.m. on January
24, 2000.
ADDRESSES: Mail an original and 3 copies of written comments to the
following address: Health Care Financing Administration, Department of
Health and Human Services, Attention: HCFA-1903-IFC, P.O. Box 8016,
Baltimore, MD 21244-8016.
If you prefer, you may deliver an original and 3 copies of your
written comments to one of the following addresses: Room 309-G, Hubert
H. Humphrey Building, 200 Independence Avenue, SW., Washington, D.C.
20201, or Room C5-09-26, 7500 Security Boulevard, Baltimore, Maryland
21244-1850.
Comments may also be submitted electronically to the following e-
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I. Background
A. Legislative History
Section 4801 of Pub. Law 105-33, the Balanced Budget Act of 1997
(BBA), authorized coverage of PACE under the Medicare program. It
amended title XVIII of the Social Security Act (the Act) by adding
section 1894, which addresses Medicare payments to, and coverage of
benefits under, PACE. Section 4802 of BBA authorized the establishment
of PACE as a State option under Medicaid. It amended title XIX of the
Act by adding section 1934, which directly parallels the provisions of
section 1894. Section 4803 of BBA addresses implementation of PACE
under both Medicare and Medicaid, the effective date, timely issuance
of regulations, priority and special consideration in processing
applications, and transition from PACE demonstration project waiver
status.
B. Demonstration Project History
Section 603(c) of the Social Security Amendments of 1983 (Pub. Law
98-21), as extended by section 9220 of the Consolidated Omnibus Budget
Reconciliation Act (COBRA) of 1985 (Pub. Law 99-272) authorized the
original demonstration waiver for On Lok Senior Health Services in San
Francisco. Section 9412(b) of Pub. Law 99-509, the Omnibus Budget
Reconciliation Act (OBRA) of 1986, authorized HCFA to conduct a PACE
demonstration project to determine whether the model of care developed
by On Lok could be replicated across the country. (The number of sites
was originally limited to 10, but OBRA 1990 authorized an increase to
15 demonstration sites.) The PACE demonstration replicated a unique
model of managed care service delivery for a small number of very frail
community-dwelling elderly, most of whom were dually eligible for
Medicare and Medicaid coverage and all of whom were assessed as being
eligible for nursing home placement according to the standards
established by their respective States. The model of care included as
core services the provision of adult day health care and
multidisciplinary team case management, through which access to and
allocation of all health services was controlled. Physician,
therapeutic,
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ancillary and social support services were furnished in the
participant's residence or on-site at the adult day health center,
unless those locations were not feasible. Hospital, nursing home, home
health, and other specialized services were furnished under contract.
Financing of this model was accomplished through prospective capitation
of both Medicare and Medicaid payments. Demonstration sites had been
permitted by section 4118(g) of Pub. Law 100-203 (OBRA of 1987) to
assume full financial risk progressively over the initial three years,
but that authority was removed by section 4803(b)(1)(B) of the BBA.
There are currently 25 approved PACE demonstration sites.
C. Use of the PACE Protocol
Throughout this document, when we refer to ``the Protocol'' we mean
the Protocol for the Program of All-inclusive Care for the Elderly
(PACE), as published by On Lok, Inc., as of April 14, 1995, or any
successor protocol that may be agreed upon between HCFA and On Lok,
Inc. A copy of the Protocol is included at Addendum A.
We are directed by sections 1894(f)(2) and 1934(f)(2) of the Act to
incorporate the requirements applied to PACE demonstration waiver
programs under the Protocol, to the extent consistent with the
provisions of sections 1894 and 1934 of the Act. We also are authorized
to modify or waive provisions of the Protocol if the modification or
waiver is not inconsistent with and would not impair the essential
elements, objectives, and requirements of sections 1894 and 1934 of the
Act.
D. Consultation With States
Sections 4801 and 4802 of Public Law 105-33 clearly dictate a
cooperative relationship between the Secretary and the States in the
development, implementation and administration of the PACE program. In
order to fulfill these requirements we utilized the American Public
Welfare Association (APWA) as the conduit to solicit States for
volunteers to consult with HCFA staff. The participating State staff
members represented States with a range of PACE experience. Each State
staff volunteer selected a specific target area to provide information.
In order to efficiently and effectively obtain a large amount of
feedback in a short period of time, HCFA staff arranged a series of
conference calls to discuss a wide range of issues pertaining to PACE
organization requirements, the application process, enrollment, and
payment and related financial data collection. Each subject area
discussion included HCFA staff and two to three State representatives.
The feedback obtained during these meetings has been an invaluable
source of information in understanding State operational concerns, in
constructing the regulation and in the development of operational
guidelines that will be released at a later date. We believe that this
approach will minimize operational barriers that are frequently
inherent when new programs are initiated.
E. Consultations With State Agency on Aging
Under the Older Americans Act, State Agencies on Aging are charged
with the responsibility of promoting comprehensive and coordinated
service systems for older persons in their States. Consistent with this
responsibility, the State Agencies on Aging oversee important programs
for home and community-based services funded through Title III of the
Older Americans Act, State revenues, and the Medicaid home and
community-based waiver program. (Two thirds of the State agencies are
involved in administering home and community-based programs.)
The State agencies also implement and oversee important planning,
information and referral, case management, and quality assurance
functions as well as administering the State Long Term Care Ombudsman
Program through which service quality in nursing homes and board and
care homes are monitored in every State. Home care quality is monitored
in an increasing number of States.
The State agency which administers the PACE program should
regularly consult with the State Agency on Aging in overseeing the
operation of the PACE program in order to avoid service duplication in
the PACE service areas and to assure the delivery and quality of
services to PACE participants. We are considering the extent to which
the State Long Term Care Ombudsman Program would be useful in promoting
the rights of PACE participants and in monitoring the quality of care
provided by PACE organizations. Additional information on this topic is
presented in the section on ``participant rights''.
F. State Medicaid Plan Requirement
The State Medicaid plan is the contract between the States and the
Federal government whereby States agree to administer the Medicaid
program in accordance with Federal law and policy. The State plan
preprint sets forth the scope of the Medicaid program, including groups
covered, services furnished, and payment policy. When a State completes
a new State plan preprint page due to changes in its Medicaid program
(called a ``State plan amendment''), the preprint page must be approved
by HCFA in order for the State to receive Federal matching funds.
Section 1905(a)(26) of the Act, as added by section 4802(a)(1) of
BBA, provides authority for States to elect PACE as an optional
Medicaid benefit. The State plan electing the optional PACE program
must be approved before we can approve an application for a PACE
organization in that State.
We developed an interim State plan preprint for PACE. A State
Medicaid letter dated March 23, 1998, provides information and guidance
to State Medicaid agencies on how to satisfy the State plan amendment
requirement. Additional directions for completing the State plan
amendment will be provided in a State Medicaid Director letter that
will be issued at or soon after publication of this regulation.
G. Interaction With Medicare+Choice
The BBA also established a new Medicare+Choice program that
expanded the health care options available to Medicare beneficiaries.
Under the Medicare+Choice program, beneficiaries may elect to receive
Medicare benefits through enrollment in one of an array of private
health plan choices beyond the original (fee-for-service) Medicare
program or the plans previously available through managed care
organizations under section 1876 of the Act. The BBA set forth the
requirements for Medicare+Choice organizations in a new part C of title
XVIII of the Act. Interim final regulations to implement the
Medicare+Choice program were published June 26, 1998 (63 FR 34968).
Final regulations addressing some of the comments were published
February 17, 1999 (64 FR 7968).
Although the PACE program has certain fundamental similarities to
Medicare+Choice and managed care organizations, PACE is not a
Medicare+Choice plan. The BBA established distinct requirements for the
PACE program. PACE is similar to some Medicare+Choice options in these
ways: it is capitated; it is risk-based; it provides managed care; and
it is an elective option. However, PACE differs significantly from
Medicare+Choice plan in other ways such as: it is not available
nationwide (only in a limited number of sites); it includes statutory
waivers that expand the scope of Medicare covered services; it is not
available to all beneficiaries (only to a defined subset of frail
elderly); and it is a joint Medicare/Medicaid program. However, the BBA
did direct us to
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consider some of the requirements established for Medicare+Choice as we
develop regulations for PACE organizations in certain areas common to
both programs, e.g., beneficiary protections, payment rates, and
sanctions.
II. Provisions of the Interim Final Rule
General Approach
As part of the President's and Vice President's regulatory reform
initiative, we have been committed to changing current regulations to
focus on outcome of care and to eliminate unnecessary procedural
requirements. We remain committed to this regulatory reform initiative.
However, in the development of the regulations for the PACE program,
several factors have contributed to the use of a more procedural rather
than outcome-oriented approach.
As set forth in sections 4801 and 4802 of the BBA, the PACE program
includes medical as well as non-medical services for the care of the
frail elderly; this is both a new and a unique model of service
delivery. Moreover, as previously noted, sections 1894(f)(2) and
1934(f)(2) of the Act establish as the foundation for this regulation
the PACE Protocol. By imposing such a requirement, Congress assured the
use of the procedural elements contained in the PACE Protocol as a
minimum to ensure beneficiary protections and safeguards. As Congress
mandated, we are adopting the requirements of the PACE Protocol to the
extent they are consistent with the statutory provisions. We have
clarified and expanded upon certain provisions contained in the
Protocol to more clearly define the requirements and make them more
quantifiable for purposes of enforcement. We will identify and discuss
all substantive modifications made to the requirements contained in the
Protocol.
After reviewing the public comments that we receive and after we
gain some experience applying the provisions of this interim final rule
to PACE programs, we will reevaluate the provisions to determine where
we can make modifications to adopt an approach more consistent with the
regulatory reform initiative.
This interim final rule contains the first published regulations
applicable to the PACE program. To accommodate the new regulations, we
are establishing a new subchapter E (PROGRAMS OF ALL-INCLUSIVE CARE FOR
THE ELDERLY (PACE)) and a new part 460 (PROGRAMS OF ALL-INCLUSIVE CARE
FOR THE ELDERLY (PACE)). We are also redesignating subchapter D as
subchapter F (PEER REVIEW ORGANIZATIONS); we are redesignating parts
462, 466, 473, and 476 as parts 475, 476, 478, and 480, respectively;
and are revising the section numbers to conform to the new part
numbers. We are reserving the former subchapter D. In addition, we are
redesignating subchapter E as subchapter G (STANDARDS AND
CERTIFICATION) with no changes in part designations.
Subpart A--Basis, Scope and Definitions
Basis (Sec. 460.2)
We state that the regulations set forth in Subchapter E, part 460,
are based on sections 1894, 1905(a), and 1934 of the Act, which
authorize Medicare payments to, and coverage of benefits under, PACE
and authorize the establishment of PACE as a State option under
Medicaid to provide for Medicaid payments to, and coverage of benefits
under, PACE.
Scope and Purpose (Sec. 460.4)
We state that the purpose of this regulation is to set forth the
requirements that an entity must meet in order to be approved as a PACE
organization that operates a PACE program under Medicare and Medicaid.
This part also sets forth how individuals may qualify to enroll in a
PACE program, how Medicare and Medicaid payment will be made for PACE
services, provisions for Federal and State monitoring of PACE programs,
and procedures for sanctions and terminations. We state that the
purpose of a PACE program is to provide pre-paid, capitated,
comprehensive health care services that are designed to:
Enhance the quality of life and autonomy for frail, older
adults;
Maximize dignity of and respect for older adults;
Enable frail, older adults to live in their homes and in
the community as long as medically and socially feasible; and
Preserve and support the older adult's family unit.
This philosophy is based on Part I, section A, of the Protocol.
Adopting a mission or philosophy statement that includes these elements
indicates that an entity is guided by a set of values that influence
its structure, planning, and day-to-day operations that is consistent
with the purpose of PACE.
Definitions (Sec. 460.6)
We provide several definitions based on those in sections 1894(a)
and 1934(a) of the Act and add definitions of several other terms.
Sections 1894(a)(3) and 1934(a)(3) of the Act define a ``PACE
provider.'' We have changed that term to ``PACE organization'' in this
regulation for clarity. The term ``PACE provider'' would be confusing
because both Medicare (at 42 CFR 400.202) and Medicaid (at 42 CFR
400.203) define the word ``provider,'' but the definitions are
different and neither applies to entities that operate PACE programs.
Those definitions denote individual providers of individual services
under conventional fee-for-service systems. We selected the alternative
term ``PACE organization'' since ``organization'' is the term used in
both titles XVIII and XIX when referring to managed care organizations,
which are more similar to entities under PACE. In the few places where
we do use the term ``provider'' in this regulation, we are using it in
the broad generic sense to refer to an individual or an entity that
furnishes health care services. Our use of the term is not limited to
the narrow Medicare definition in 400.202. We define a PACE
organization as an entity that has in effect a PACE program agreement.
Based on sections 1894(a)(4) and 1934(a)(4) of the Act, we define a
PACE program agreement as an agreement between a PACE organization,
HCFA, and the State administering agency for the operation of a PACE
program.
In accordance with sections 1894(a)(8) and 1934(a)(8) of the Act,
we define the State administering agency as the State agency
responsible for administering the PACE program agreement.
In accordance with sections 1894(a)(9) and 1934(a)(9) of the Act,
we define a trial period as the first three contract years in which a
PACE organization operates under a PACE program agreement, including
any contract year during which the entity operated under a PACE
demonstration waiver program.
We have added a definition of a contract year as the term of a PACE
program agreement, which is a calendar year except that a PACE
organization's initial (start-up) contract year may be from 12 to 23
months as determined by HCFA. This will enable us to adjust the length
of the initial (start-up) contract year so that subsequent years are on
a standard annual calendar year cycle.
We define a Medicare beneficiary as an individual who is entitled
to Medicare Part A benefits and/or enrolled under Medicare Part B. This
term includes dually-eligible individuals who are also Medicaid
recipients.
We have defined a participant as an individual enrolled in a PACE
program. A Medicare participant is a Medicare beneficiary who is
enrolled in a PACE
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program, and a Medicaid participant is a Medicaid recipient who is
enrolled in a PACE program.
We clarify that the term ``services'' includes both items and
services.
Subpart B--PACE Organization Application and Evaluation
Purpose (Sec. 460.10)
This subpart establishes application requirements for an entity
that seeks approval from HCFA as a PACE organization.
PACE Under Both Medicare and Medicaid
We are requiring that each PACE organization must enter into a
program agreement under both sections 1894 and 1934 of the Act, i.e.,
that each organization participate in both Medicare and Medicaid. Most
of the text of those sections is identical and our analysis indicates
that key sections contemplate entities acting as PACE organizations
under both programs.
Sections 1894(f)(2) and 1934(f)(2) of the Act require that we
incorporate in regulations the requirements applied to PACE
demonstration waiver programs under the PACE Protocol, to the extent
consistent with the provisions of sections 1894 and 1934. Under the
Protocol, PACE demonstration programs operated under both Medicare and
Medicaid. We believe that the directive to incorporate the requirements
in the Protocol reflects an expectation by Congress that all PACE
organizations would participate in both Medicare and Medicaid. This
view is reinforced by paragraph (f)(2)(B) of these sections, which
permits us to modify or waive provisions of the PACE Protocol ``so long
as such modification or waiver is not inconsistent with and would not
impair the essential elements, objectives, and requirements'' of
sections 1894 and 1934, but which forbids modifying or waiving, among
others, the following provisions:
Capitated, integrated financing that allows the
organization to pool payments received from public and private programs
and individuals; and
The assumption by the organization of full financial risk.
We have concluded that both of these provisions preclude the
possibility of a Medicare-only or Medicaid-only PACE program. For
example, if a program could collect capitation payments from Medicare
but bill fee-for-service under Medicaid, not all financing would be
capitated, nor would financing be integrated, nor would the
organization assume full financial risk.
The law does not require that States offer the PACE benefit under
Medicaid. As indicated by its title, section 4802 of BBA provides for
the ``Establishment of PACE Program as Medicaid State Option.'' If an
entity attempted to become a PACE organization under Medicare in a
State which has not included PACE program services as an option under
its Medicaid program, it would not be possible for that entity to be
both a Medicare and a Medicaid PACE organization. While this would
curtail the availability of PACE programs in such States, we have
concluded that this result was intended because a Medicare-only program
could not meet the fundamental concept of an all-inclusive, integrated,
capitated, full-risk program.
Moreover, both sections 1894 and 1934 of the Act contemplate the
active collaboration of Federal and State governments in the
administration of PACE. Each State must have a State administering
agency that is responsible for administering PACE program agreements in
the State under sections 1894 and 1934 of the Act. The State
administering agency closely cooperates with HCFA in establishing
procedures for entering into, extending, and terminating PACE program
agreements. The State administering agency cooperates with HCFA and the
PACE organization in the development of participant health status and
quality of life outcome measures. The State administering agency
cooperates with HCFA in conducting oversight reviews of PACE programs
and has the authority to terminate a PACE program agreement for cause.
If Medicare-only programs had been contemplated in a State that does
not elect the PACE option, there would have been no reason to assign
such a significant role to a State administering agency. We believe
that a State which has not chosen PACE as an optional service would be
ill-prepared or unable to perform this role.
Most of the text of section 1894 of the Act is identical to text in
section 1934. Portions of that text reflect the concept of entities
acting as PACE organizations under both programs. The scope of Medicare
PACE program benefits includes ``all items and services covered under
this title (for individuals enrolled under this section [section 1894])
and all items and services covered under title XIX.'' Similarly,
section 1934 defines the Medicaid benefit package as ``all items and
services covered under title XVIII (for individuals enrolled under
section 1894) and all items and services covered under this title.'' In
addition, to be eligible for PACE, an individual must require the
nursing facility level of care covered under the State Medicaid plan.
Section 1894(e) of the Act provides that ``the Secretary, in close
cooperation with the State administering agency'' will establish
program agreements for ``entities that meet the requirements for a PACE
organization under this section, section 1934, and regulations.'' A
corresponding provision is found at section 1934(e) of the Act,
referring to ``entities that meet the requirements for a PACE
organization under this section, section 1894, and regulations.'' We
believe that the use of the correlative ``and'' indicates that PACE
entities would have to meet all three sets of requirements.
A parallel provision provides for termination of PACE program
agreements (see paragraphs (e)(5) of sections 1894 and 1934 of the
Act). Termination of an agreement under both sections 1894 and 1934 may
be accomplished by either ``the Secretary or a State administering
agency.''
On the other hand, we acknowledge that there are some portions of
the law which are inconsistent with this position. First, there is the
fact that Congress enacted Medicare and Medicaid PACE benefits through
two separate statutory sections. In addition, section 4803(c)(1) of BBA
directs us, in determining ``provider status,'' to ``give priority in
processing applications of entities to qualify as PACE programs under
section 1894 or 1934 of the Social Security Act.'' Further, section
1894(a)(4) defines a PACE program agreement as ``an agreement,
consistent with this section, section 1934 (if applicable), and
regulations promulgated to carry out such sections.'' See also section
1934(a)(4).
Nonetheless, it is highly unlikely that any entity could be a
viable PACE organization without approval under both Medicare and
Medicaid. The majority of potential participants are Medicare
beneficiaries who also are eligible for Medicaid. Those who are not
currently Medicaid-eligible may eventually exhaust their financial
resources and become eligible. Medicare participants who are not
enrolled in PACE under Medicaid must pay premiums equal to the Medicaid
capitation rate. Aside from the technicality that there would not be an
established Medicaid capitation rate in a State that does not elect the
PACE option, most of these participants would lack the ability to pay
such significant premiums.
As the above citations illustrate, some provisions of the law are
conflicting and thus ambiguous. We therefore must interpret them to
give effect to as many of the provisions as possible and to the policy
objectives that they advance. In
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keeping with the Congressional intent that the PACE Protocol guide our
implementation of the PACE program, we have determined that PACE
organizations must be approved under both Medicare and Medicaid. Based
on this interpretation, if a State should choose not to amend its State
Medicaid plan to adopt PACE as an optional Medicaid service, we would
not accept PACE applications from entities in that State. Also, if a
State has elected the optional benefit but declines to recommend a
particular entity as a PACE organization, we would not accept an
application from that entity.
Application Requirements (Sec. 460.12)
Section 1905(a)(26) of the Act provides authority for States to
elect PACE as an optional Medicaid benefit. The State plan electing the
optional PACE program must be approved before we can approve an
application for a PACE organization in that State.
We have established Sec. 460.12 to set forth the application
requirements for the PACE program. In order for HCFA to determine
whether an entity qualifies as a PACE organization, an individual
authorized to act for the entity must submit an application that
describes thoroughly how the entity meets all the requirements
specified in this regulation. In recognition of the 90-day review
timeframe specified in the statute and described below and the
numerical limit on the number of PACE program agreements, HCFA will
review and take action to approve, deny or request additional
information only on complete applications; i.e, those applications that
address all elements of the PACE program agreement. HCFA will send a
letter to each applicant indicating whether or not the application is
complete and specifying when the 90-day review period ends.
Except for entities that qualify for priority processing or special
consideration as discussed below, we will accept and begin to review
applications 90 days after the effective date of this interim final
regulation. Entities interested in obtaining specific information for
use in applying for PACE organization status should access the PACE
homepage, available through both the Medicare and Medicaid HCFA
websites (www.hcfa.gov/medicare (or medicaid) /PACE/pacehmpg.htm).
States have played a significant role in the development of PACE
demonstration projects as well as other community-based alternatives to
institutionalization. Most States have implemented home and community
based programs to provide comprehensive coordinated services to various
groups of Medicaid recipients. As a result, States have gained
extensive experience in demographic analysis and contracting with
entities that are capable of delivering a specified range of services.
Although the PACE statute does not specify the States' role in the
application approval process, many aspects of implementing PACE in
Medicare and Medicaid will necessitate extensive involvement of the
State administering agencies and the State Medicaid Agencies. With
regard to applications, we believe the States are in the best position
to work with potential organizations to develop programs that meet our
requirements and are integrated into the State's overall long-term care
delivery system.
Therefore, we are requiring in Sec. 460.12(b) that applications for
PACE organization status be accompanied by an assurance from the State
administering agency indicating that it considers the entity to be
qualified to be a PACE organization and that the State is willing to
enter into a PACE program agreement with the entity. We will not accept
applications from entities that have not obtained these assurances.
To enable a State to make such assurances, an entity would have
established to the satisfaction of the State that it is committed to
the PACE model of care, there is sufficient funding for program
development and facilities, there is adequate demand for PACE services
as shown by demographic analysis, and the entity has hired core PACE
staff and has developed contracts for referral arrangements and other
program services that the site will not furnish directly.
Entities that are interested in developing a PACE program agreement
should contact their State administering agency to determine whether
the State has submitted or plans to submit a State plan amendment to
elect PACE as an optional benefit under its State Medicaid plan and if
the State has established additional requirements for PACE
organizations.
Priority Consideration (Sec. 460.14)
We have established section 460.14 to address priority
applications. The statute requires that we give priority in processing
applications through August 5, 2000, to entities that are operating
under PACE demonstration waivers under the authority of section 603(c)
of the Social Security Amendments of 1983, as extended by section 9220
of COBRA of 1985, or section 9412(b) of the OBRA of 1986. In addition,
we are directed to give priority to entities that applied to operate
under a PACE demonstration waiver under section 9412(b) of the OBRA of
1986 as of May 1, 1997.
To give priority in processing applications from entities that meet
the criteria, we will accept applications only from these entities
beginning on the effective date of this interim final regulation and
continuing for 45 days. Applications from other entities will not be
accepted during this period. During the subsequent 45 days, extending
to 90 days after the effective date of this regulation, we will
continue to accept applications from entities that meet the priority
processing criteria and we also will accept applications from entities
that qualify for special consideration.
Special Consideration (Sec. 460.16)
In Sec. 460.16, Special Consideration, we define the qualifications
to receive special consideration of a PACE application.
The statute requires that we give special consideration in the
processing of applications through August 5, 2000, to an entity that,
as of May 1, 1997, indicated a specific intent to become a PACE
organization through formal activities, such as entering into a
contract to conduct a PACE feasibility study.
To give special consideration in processing applications from
entities that meet the criteria, we will accept applications from these
entities beginning 45 days after the effective date of this interim
final regulation. During the 45-day period that extends from 45 days
after the effective date to 90 days after the effective date, we will
accept applications only from entities that meet the priority
processing criteria or entities that qualify for special consideration.
Applications from other entities will not be accepted during this
period.
Applications from entities that believe they are entitled to
special consideration must include information regarding the formal
activities they engaged in towards becoming a PACE organization. If we
agree that special consideration is appropriate for applications
submitted after the special 45-day window, we will identify those
applicants and factor in the entity's special status in the event that
we have a greater number of applications under review than available
capacity for PACE program agreements.
HCFA Evaluation of Applications (Sec. 460.18)
We will approve entities based upon a review of the materials
submitted as part of the application, as well as information from the
State
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administering agency and information obtained through onsite visits.
Notice of HCFA Determination (Sec. 460.20)
Sections 1894(e)(8) and 1934(e)(8) of the Act require us to approve
or deny an application for PACE organization status within 90 days
after the date of the submission of the application unless additional
information is requested. Applications are deemed approved unless we
deny PACE organization status in writing or request additional
information within the 90-day timeframe. We clarify that, for purposes
of the 90-day time limit described in this section, the date that an
application is considered to be submitted to HCFA is the date on which
the application is delivered to the address designated by HCFA.
These sections also provide that we may request in writing such
additional information as may be required in order to make a final
determination regarding the application and, after the date we receive
such information, the application shall be deemed approved unless,
within 90 days of such date, we deny such request.
Based on this authority, we may take up to 90 days to request
additional information and, once the information is received, may take
an additional 90 days to complete processing of the application. It is
important to note that there is no corresponding requirement that the
State administering agency or the PACE organization respond to HCFA's
request for additional information within a specified timeframe.
If the additional information proves insufficient to approve the
application, the application will be denied. We will notify each
applicant of our determination and the basis for the determination in
writing. If the application is denied, we will provide the basis for
the denial and the process for requesting reconsideration of the
application.
Priority and Special Consideration
Section 4803(c) of the BBA directs us to give priority in
processing applications of entities to qualify as PACE organizations
under section 1894 or 1934 of the Act first to PACE demonstration sites
and then to entities which had applied to operate a PACE demonstration
site as of May 1, 1997. In addition, section 4803(c)(3) of the BBA
requires that we give special consideration in the processing of
applications to any entity that, as of May 1, 1997, had indicated
specific intent to become a PACE organization through formal activities
such as entering into contracts for feasibility studies.
Service Area Designation (Sec. 460.22)
In Sec. 460.22, Service Area Designation, we specify that each
application must designate the service area of the program. HCFA (in
consultation with the State administering agency) may exclude from the
proposed service area designation any area that is already covered
under another PACE program agreement. This will avoid unnecessary
duplication of services and impairing the financial and service
viability of an existing PACE organization. This section implements the
provisions of sections 1894(e)(2)(B) and 1934(e)(2)(B) of the Act.
Limit on Number of PACE Program Agreements (Sec. 460.24)
Sections 1894(e)(1)(B) and 1934(e)(1)(B) of the Act establish a
limit on the number of PACE program agreements that may be in effect on
August 5 of each year, i.e., the anniversary of the enactment of the
PACE statute. Those sections state that the Secretary shall not permit
the number of PACE organizations with which agreements are in effect
under those sections or under section 9412(b) of the OBRA of 1986 to
exceed--
40 as of August 5, 1997, the date of the enactment of the
PACE statute, or
As of each succeeding anniversary of such date, the
numerical limitation for the preceding year plus 20. The annual
increase in the number of PACE program agreements is not tied to the
actual number of agreements in effect as of a previous anniversary
date.
Based on this statutory language, we may enter into up to 80 PACE
program agreements as of August 5, 1999 and the limit on the number of
PACE program agreements increases by 20 each year thereafter.
Subpart C--PACE Program Agreement
Program Agreement Requirement (Sec. 460.30)
In accordance with sections 1894(a)(4) and 1934(a)(4) of the Act we
have established Sec. 460.30 to require that each PACE organization
have an agreement with HCFA and the State administering agency for the
operation of a PACE program by the organization under Medicare and
Medicaid. This three-party agreement must be signed by an authorized
official of the organization, as well as by an authorized HCFA official
and an authorized State official.
Content and Terms of PACE Program Agreement (Sec. 460.32)
In Sec. 460.32(a), we stipulate the required content of a PACE
program agreement.
We are requiring that each PACE program agreement designate the
service area of the program, specifically identifying the area by
county, zip code, street boundaries, census tract, block, or tribal
jurisdictional area, to the extent that those identifiers are
appropriate. Any changes in the designated service area will require
advance approval by HCFA and the State administering agency. This
requirement implements the provisions of sections 1894(e)(2)(A)(I) and
1934(e)(2)(A)(I) of the Act and reflects Part I, section D of the
Protocol.
Each PACE organization must agree to meet all applicable
requirements under Federal, State, and local laws and regulations,
including provisions of the Civil Rights Act, the Age Discrimination
Act, and the Americans with Disabilities Act. This includes, but is not
limited to, all requirements contained elsewhere in these regulations.
This requirement implements in part the provisions of sections
1894(e)(2)(A)(iv) and 1934(e)(2)(A)(iv) of the Act.
We require that each agreement indicate the effective date and term
of the agreement.
We are requiring that each PACE program agreement include
information related to: organizational structure of the PACE
organization; participant rights; process for grievances and appeals;
eligibility, enrollment and disenrollment policies; service
description; quality assessment and performance improvement; capitation
rates; names and numbers of administrative contacts in the
organization; and program agreement termination procedures. These
requirements are based on sections 1894(b)(2) and 1934(b)(2) of the Act
and on Part X, section A of the Protocol.
We will identify in each PACE program agreement the levels of
performance that we require the organization to achieve on standard
quality measures and the data and information on participant care that
we and the State require the organization to collect. A detailed
discussion of the levels of performance and the standard quality
measures are contained in the preamble discussions for Secs. 460.134
and 460.202(b) of this regulation.
In Sec. 460.32(b), we specify that a PACE program agreement may
provide additional requirements for individuals to qualify as PACE
program eligible individuals. This provision implements
[[Page 66240]]
sections 1894(e)(2)(A)(ii) and 1934(e)(2)(A)(ii) of the Act. However,
the eligibility criteria in Sec. 460.150(b)(1)-(3) cannot be modified.
In addition, a PACE program agreement may contain such additional terms
and conditions as the parties agree to, if such terms and conditions
are consistent with sections 1894 and 1934 of the Act and with these
regulations. This provision implements sections 1894(e)(2)(A)(v) and
1934(e)(2)(A)(v) of the Act.
Duration of PACE Program Agreement (Sec. 460.34)
In Sec. 460.34, we specify that each agreement will be effective
for a contract year, but may be extended for additional contract years
in the absence of a notice by a party to terminate, in accordance with
sections 1894(e)(2)(A)(iii) and 1934(e)(2)(A)(iii) of the Act.
Subpart D--Sanctions, Enforcement Actions, and Terminations
Violations for Which HCFA May Impose Sanctions (Sec. 460.40)
In Sec. 460.40 we specify, based on paragraph (e)(6)(B) of sections
1894 and 1934 of the Act, that HCFA can impose, in addition to any
other remedies authorized by law, any of three types of sanctions if
HCFA determines that a PACE organization has committed any of nine
listed violations. The following PACE organization violations specified
in this section are based on provisions of sections 1857(g)(1) and
1903(m)(5)(A) of the Act:
Fails substantially to furnish to a participant medically
necessary items and services that are covered PACE services, if the
failure has adversely affected (or has substantial likelihood of
adversely affecting) the participant.
Involuntarily disenrolls a participant, in violation of
Sec. 460.164.
Discriminates in enrollment or disenrollment among
Medicare beneficiaries or Medicaid recipients, or both, who are
eligible to enroll in a PACE program, on the basis of an individual's
health status or need for health care services.
Engages in any practice that would reasonably be expected
to have the effect of denying or discouraging enrollment, except as
permitted by Sec. 460.150, by Medicare beneficiaries or Medicaid
recipients whose medical condition or history indicates a need for
substantial future medical services.
Imposes charges on participants enrolled under Medicare or
Medicaid for premiums in excess of the premiums permitted.
Misrepresents or falsifies information that is furnished
to HCFA or the State under this part; or, to an individual or any other
entity under this part.
Prohibits or otherwise restricts a covered health care
professional from advising a participant who is a patient of the
professional about the participant's health status, medical care, or
treatment for the participant's condition or disease, regardless of
whether the PACE program provides benefits for that care or treatment,
if the professional is acting within his or her lawful scope of
practice.
Operates a physician incentive plan that does not meet the
requirements of section 1876(i)(8) of the Act.
Employs or contracts with any individual who is excluded
from participation in Medicare or Medicaid under section 1128 or 1128A
of the Act (or with any entity that employs or contracts with such an
individual) for the provision of health care, utilization review,
medical social work, or administrative services.
Sanctions That HCFA Can Impose (Secs. 460.42 and 460.46)
We describe the two types of sanctions in Secs. 460.42 (suspension
of enrollment or payment by HCFA) and 460.46 (civil money penalties).
Each of the sanctions, or remedies, that are specified in these
sections for specific violations are based on provisions of sections
1857(g)(2), 1857(g)(4), and 1903(m)(5)(B) of the Act. With respect to
suspension of enrollment in PACE, HCFA may suspend enrollment of
Medicare beneficiaries after the date HCFA notifies the organization of
the violation. Suspending enrollment of Medicaid recipients is an
action taken by the State rather than HCFA. With respect to suspension
of payment, HCFA may suspend Medicare payment to the PACE organization
and deny payment to the State for medical assistance for services
furnished under the PACE program agreement.
In addition, HCFA may impose civil money penalties of $100,000 plus
$15,000 for each individual not enrolled as a result of the PACE
organization's discrimination in enrollment or disenrollment or
practice that would deny or discourage enrollment; $25,000 plus double
the excess amount above the permitted premium charged a participant by
the PACE organization; $100,000 for each misrepresentation or
falsification of information; and $25,000 for any violation specified
in Sec. 460.40.
Additional Actions by HCFA or the State (Sec. 460.48)
In Sec. 460.48 we specify, based on paragraph (e)(6)(A) of sections
1894 and 1934 of the Act, that if HCFA, after consultation with the
State administering agency, determines that a PACE organization is not
in substantial compliance with requirements in these regulations, HCFA
or the State administering agency can take one or more of the following
actions: Condition the continuation of the PACE program agreement upon
timely execution of a corrective action plan; withhold some or all
payments under the PACE program agreement until the organization
corrects the deficiency; or terminate the program agreement.
Termination of PACE Program Agreement (Sec. 460.50)
In Sec. 460.50 we specify, in accordance with paragraph (e)(5)(A)
of sections 1894 and 1934 of the Act, that HCFA or a State
administering agency may terminate at any time a PACE program agreement
for cause and that a PACE organization may terminate an agreement after
appropriate notice to HCFA, the State administering agency, and
participants. In accordance with paragraph (e)(5)(B) of sections 1894
and 1934 of the Act, we specify that HCFA or a State administering
agency may terminate a PACE program agreement with a PACE organization
if HCFA or the State administering agency determines that:
Either there are significant deficiencies in the quality
of care furnished to participants, or the PACE organization has failed
to comply substantially with conditions under these regulations or with
the terms of its PACE program agreement; and
The PACE organization has failed to develop and
successfully initiate, within 30 days of the date of the receipt of
written notice, a plan to correct the deficiencies, or has failed to
continue implementation of such a plan.
Based on the Protocol, Part IX, section A.1, we also provide for
termination if HCFA or the State administering agency determines that
the organization cannot ensure the health and safety of its
participants. This determination may result from the identification of
deficiencies which HCFA or the State administering agency determines
cannot be corrected. Based on the Protocol, Part IX, section A.2, we
also require that if the organization terminates the agreement, a
minimum of 90 days notice must be given to HCFA and the State
administering agency regarding the organization's intent and that
participants must be given a minimum of 60 days notice.
[[Page 66241]]
Transitional Care During Termination (Sec. 460.52)
Based on the Protocol, Part IX, section B, we require that the PACE
organization develop a detailed written plan for phase-down in the
event of termination which includes the following: the process for
informing participants, the community, HCFA and the State administering
agency in writing about termination and transition procedures; and
steps that will be taken to help assist participants to obtain
reinstatement of conventional Medicare and Medicaid benefits,
transition their care to other providers, and terminate marketing and
enrollment activities. Also, in accordance with paragraphs (a)(2)(C)
and (e)(5)(C) of sections 1894 and 1934 of the Act, we specify in
Sec. 460.52 that an entity whose PACE program agreement is in the
process of being terminated must provide assistance to each participant
in obtaining necessary transitional care through appropriate referrals
and making the participant's medical records available to new
providers.
Termination Procedures (Sec. 460.54)
In Sec. 460.54 we specify termination procedures based on paragraph
(e)(7) of sections 1894 and 1934 of the Act, which provide that:
The provisions of section 1857(h) of the Act apply to
termination of a PACE program agreement in the same manner as they
apply to a termination of a contract with a Medicare+Choice
organization under part C of title XVIII of the Act.
The provisions of section 1857 of the Act authorize termination of an
agreement with an organization based on the following:
We provide the organization with the reasonable
opportunity to develop and implement a corrective action plan to
correct the deficiencies that were the basis of our determination that
cause exists for termination; and
We provide the organization with reasonable notice and
opportunity for hearing (including the right to appeal an initial
decision) before terminating the agreement. However, termination is
authorized by section 1857(h)(2) of the Act without invoking these
procedures if we determine that a delay in termination, resulting from
compliance with these procedures before termination, would pose an
imminent and serious risk to the health of participants enrolled with
the organization.
Subpart E--PACE Administrative Requirements
PACE Organizational Structure (Sec. 460.60)
We have established Sec. 460.60 to specify the structural
requirements for a PACE organization. We believe that these
requirements are essential to the PACE organization's ability to ensure
the health and safety of the participants. The performance of certain
basic organizational functions is a minimum condition for an
environment in which appropriate care can occur. We have based the
organizational structure requirements on Part I of the Protocol.
We require that the PACE organization have a current organizational
chart showing officials in the PACE organization and relationships to
any other organizational entities. The chart for a corporate entity
must indicate the PACE organization's relationship to the corporate
board and to any parent, affiliate, or subsidiary corporate entities. A
PACE organization that is planning a change in organizational structure
must notify HCFA, the State administering agency, and participants, in
writing, at least 60 days before the change would take effect. Changes
in organizational structure must be approved by HCFA and the State
administering agency. In the event of a change that would constitute a
change of ownership, HCFA would apply the general provisions described
in 42 CFR 422.550. Changes in organizational structure approved by HCFA
and the State administering agency must be forwarded to the consumer
advisory committee (described later in the preamble in the section on
governing body) for dissemination to participants as appropriate. We
specifically invite comment on the extent to which changes in
organizational structure are important to participants, information on
the types of changes that have been communicated to participants, the
timing of disclosure, and the effect on participants.
The Protocol requires that a PACE organization have a project
director. We have included this requirement, but have changed the term
to program director. We have renamed this position and further defined
the role of the individual. The PACE organization must have a program
director who is responsible for the oversight and administration of the
entity. She or he would be responsible for the effective planning,
organization, administration, and evaluation of the organization's
operations. The program director would ensure that decisions about
medical, social and supportive services are not unduly influenced by
fiscal managers. The program director is responsible for ensuring that
appropriate personnel perform their functions within the organization.
The program director would inform employees and contract providers of
all organization policies and procedures. If the PACE organization is
part of a larger health system, the program director would clearly
define and inform staff (employees and contractors) of the
relationship.
We have also maintained the Protocol's requirement for a medical
director, but we have further defined the responsibilities of this
position. The PACE organization must have a medical director who is
responsible for the delivery of participant care, clinical outcomes,
and the implementation and oversight of the quality assessment and
performance improvement program. Thus, the medical director is
responsible for achieving the best clinical outcomes possible for all
participants. Under this requirement, we would expect the medical
director to use data comparing the program with other PACE
organizations, where data are available, and to use the organization's
data to demonstrate internal improvements in outcomes over time.
Governing Body (Sec. 460.62)
This section focuses on the ability of the organization's governing
body to provide effective administration in an outcome-oriented
environment. The governing body guides operations and promotes and
protects participant health and safety. The governing body is legally
and fiscally responsible for the administration of the PACE
organization. However, the specific approach to administration of the
organization is left to the discretion of the governing body. This
reflects our goal of promoting the effective management of the
organization, without limiting flexibility in determining how to
achieve that goal.
The governing body must create and foster an environment that
provides quality care that is consistent with participant needs and the
program mission. To that end, the primary requirement is that an
identifiable governing body, or designated person(s) so functioning,
have full legal authority and responsibility for the governance and
operation of the organization, the development of policies consistent
with the mission, the management and provision of all services
(including the management of contractors), fiscal operations, and the
development of
[[Page 66242]]
policies on participant health and safety. Also, the governing body
will establish personnel policies and contract provisions with respect
to employees or contractors with patient care responsibilities giving
adequate notice before leaving the PACE organization's network. These
provisions would be intended to avoid disruptions in care and permit
orderly transition of responsibilities.
We have added a requirement that the governing body be responsible
for the quality assessment and performance improvement program. The
purpose of this requirement is to link the development, implementation,
and coordination of the ongoing quality assessment and performance
improvement program with all aspects of the PACE program. We believe
this requirement will stimulate an aggressive effort by the
organization to identify and use the best practices available for all
participants. As discussed in the section on the quality assessment and
performance improvement program, the PACE organization has the
flexibility to design its own quality improvement program.
Consistent with the Protocol, we have included a requirement that
the PACE organization must ensure community representation on issues
related to participant care. This may be achieved by having a community
representative on the governing body.
We have added a requirement that a PACE organization must establish
a consumer advisory committee to provide advice to the governing body
on matters of concern to participants. Consumer participation through
advisory committees is a well accepted community organization vehicle
to maximize the involvement of consumers in a program designed to serve
them. With the use of such a committee the governing body will have the
benefit of consumer advice, including advice on quality of care.
Consumers also are likely to feel a greater stake in the operation of
the program. In order to assure appropriate representation,
participants and representatives of participants must constitute a
majority of the membership of this committee. One specific duty of the
consumer advisory committee is to receive information regarding changes
in the PACE organization's structure to determine those about which
information should be disseminated to participants.
Personnel Qualifications (Sec. 460.64)
Although the Protocol does not specify personnel requirements for
the various staff employed by or under contract with the PACE
organization, we believe that certain minimum standards must be met in
order to ensure quality of care for the frail elderly population being
served. To this end, we have established Sec. 460.64.
Our approach to personnel qualifications follows principles
described in a Federal Register publication proposing changes to the
conditions of participation for home health agencies, 62 FR 11022-23
(March 10, 1997). This is a flexible approach that relies on State
requirements as much as possible. We require that personnel meet
applicable State licensure, certification, or registration
requirements. The personnel qualifications fall into three categories:
(1) personnel for whom there are statutory qualifications; (2)
personnel for whom all States have licensure, certification, or
registration requirements; and (3) personnel for whom we have specified
requirements since not all States have licensure, certification, or
registration requirements.
The first category consists of personnel for whom the Act contains
qualifications. Section 1861(r) of the Act generally defines a
physician as a doctor of medicine or osteopathy, legally authorized to
practice medicine and surgery by the State in which such function or
action is performed, or certain other practitioners for limited
purposes. This definition is reflected in regulations at 42 CFR 410.20,
and we have adopted this definition for a physician providing services
for a PACE organization. In addition, to reflect the key role of the
primary care physician in the PACE model, we are requiring the primary
care physician to have a minimum of 1 year's experience in working with
a frail or elderly population.
In the second category of personnel qualifications, we defer to
State law. We specify that all staff (employee or contractor) of the
PACE organization must meet applicable State requirements. That is,
they must be legally authorized (currently licensed or, if applicable,
certified or registered) to practice in the State in which they perform
the function or action and must act within the scope of their authority
to practice.
The third category of personnel qualifications includes certain
professions for which not all States currently have licensing,
certification, or registration requirements. If a State does have
licensing, certification, or registration requirements for a
professional listed in this section, then the State qualifications
would apply.
We reviewed the personnel requirements of other Medicare and
Medicaid providers that serve populations similar to PACE participants
(e.g., home health agencies, nursing facilities, intermediate care
facilities), and we have established personnel requirements for PACE
organizations that are as consistent as possible with those applicable
to other providers. If a State does not have licensing, certification,
or registration requirements applicable to the following professions,
then the qualifications specified below apply.
We are requiring that the registered nurse be a graduate of a
school of professional nursing and have a minimum of one year's
experience working with a frail or elderly population.
We are requiring that the social worker (1) have a master's degree
in social work from an accredited school of social work; and (2) have a
minimum of one year's experience working with a frail or elderly
population.
We are requiring that the physical therapist (1) be a graduate of a
physical therapy curriculum approved by the American Physical Therapy
Association, the Committee on Allied Health Education and Accreditation
of the American Medical Association, or the Council on Medical
Education of the American Medical Association and the American Physical
Therapy Association; and (2) have a minimum of one year's experience
working with a frail or elderly population.
We are requiring that the occupational therapist (1) be a graduate
of an occupational therapy curriculum accredited jointly by the
Committee on Allied Health Education and Accreditation of the American
Medical Association and the American Occupational Therapy Association;
(2) be eligible for the National Registration Examination of the
American Occupational Therapy Association; (3) have 2 years of
appropriate experience as an occupational therapist and have achieved a
satisfactory grade on a proficiency examination conducted, approved, or
sponsored by the U.S. Public Health Service, except that such
determination of proficiency does not apply with respect to persons
initially licensed by a State or seeking initial qualification as an
occupational therapist after December 31, 1977; and (4) have a minimum
of one year's experience working with a frail or elderly population.
We are requiring that the recreation therapist or activities
coordinator have 2 years experience in a social or recreational program
providing and
[[Page 66243]]
coordinating services for a frail or elderly population within the last
5 years, one of which was full-time in a patient activities program in
a health care setting.
We are requiring that the dietitian (1) have a baccalaureate or
advanced degree from an accredited college with major studies in food
and nutrition or dietetics; and (2) have a minimum of one year's
experience working with a frail or elderly population.
We are requiring that all PACE center drivers (1) have a valid
driver's license to operate a van or bus in the State of operation; and
(2) be capable of and experienced in transporting individuals with
special mobility needs.
We believe that each of these persons should have experience
working with the frail or elderly population in order to better
recognize issues specific to this population.
We have not defined personnel requirements for the PACE center
manager or the home care coordinator. We are giving PACE organizations
the flexibility to determine who is best suited to fill these positions
since each PACE center may have different needs. Since the home care
coordinator is responsible for acting as the liaison between the
multidisciplinary team and the home care providers, she or he should
possess good leadership and communication skills. In addition, the home
care coordinator should be able to identify and understand
participants' medical and social needs and evaluate the home care needs
of participants. Therefore, we believe that a registered nurse or
social worker would be a good candidate to fill this position.
We have not imposed personnel requirements for personal care
attendants since these individuals will primarily be providing ``non-
skilled'', personal care services (e.g., bathing, toileting,
transferring). We are soliciting comments on whether to include
specific personnel requirements for personal care attendants. It is
important that personal care attendants possess certain basic skills
necessary to provide quality care to PACE participants. Thus, we are
requiring PACE organizations to implement a training program for each
personal care attendant to ensure that they exhibit competency in basic
skills in personal care services. The training program should include
maintenance of a clean, safe, and healthy environment; appropriate and
safe techniques in personal hygiene and grooming; safe transfer
techniques and ambulation; reading and recording temperature, pulse,
and respiration; and observation, reporting, and documentation of
patient status and the care or service furnished. In addition, the
training program developed for each personal care attendant must
include other elements consistent with their assigned duties for
specific participants.
We recognize that personal care attendants in the home environment
may furnish not only personal care services, but also home care
services. When the participant needs home care services, the PACE
organization must ensure that it has qualified staff (either employees
or contractors) that meet the requirements for home health aides to
furnish these services.
Training (Sec. 460.66)
In Sec. 460.66, we have required that the PACE organization provide
ongoing training to maintain and improve the skills and knowledge of
each staff member with respect to their specific duties. The training
should result in the staff's continued ability to demonstrate the
skills necessary for the performance of their specific positions or job
duties. The ability of the PACE organization to ensure patient safety
and to achieve patient-specific performance measures requires competent
staff. We believe there is a direct relationship between the quality of
the organization's staff and patient well-being. The training
requirement is intended to ensure that all staff are able to adapt to
new or additional job demands. The PACE organization is only
responsible for ensuring that the individual is educated and trained
for her or his specific job. The individual would continue to be
responsible for her or his own professional education and for any
continuing education needed to maintain licensure or professional
certification unless the organization chooses to assume this
responsibility. In addition, we have included a specific training
requirement for personal care attendants as described above.
Program Integrity (Sec. 460.68)
We have established Sec. 460.68 to guard against potential
conflicts of interest or other program integrity problems for PACE
organizations, based on Part I, section E of the Protocol. An
organization must not have any staff (employees or contractors) who
have been convicted of criminal offenses related to their involvement
in Medicaid, Medicare, other health insurance or health care programs,
or social service programs under Title XX of the Act. We expanded this
provision from the Protocol to prohibit an organization from having any
staff who have been excluded from participation in Medicare or
Medicaid, or having staff in any capacity where an individual's contact
with participants would pose a potential risk because the individual
has been convicted of physical, sexual, drug, or alcohol abuse. Members
of the PACE organization's governing body, and their family members,
are prohibited from having a direct or indirect interest in contracts
with the organization. (Examples of indirect interests are holdings in
the name of a spouse, dependent child, or other relative who resides
with the member of the governing body.) These requirements are intended
to protect participants and to prevent fraud under Medicare and
Medicaid.
We recognize that in rural, Tribal, or urban Indian communities
there may be limited availability of individuals willing to and capable
of performing key functions for the PACE organization. HCFA and the
State administering agency may grant a waiver of the conflict of
interest requirement for PACE organizations to allow individuals who
have a direct or indirect interest in a contract or the provision of
services to the PACE organization to recuse themselves from decisions
directly or indirectly affecting those interests, rather than barring
them entirely from serving on the PACE organization's policy making
board or as directors, officers, partners, employees, or consultants of
the PACE organization. Such a waiver may be granted if HCFA and the
State administering agency determine that there are not enough people
who could meet the requirement in the PACE organization's service area
and the proposed alternative does not adversely affect the availability
of care or the quality of care that is provided to participants.
We have also added the requirement that the PACE organization must
have a process to gather information on program integrity issues and
respond to any request from HCFA within a reasonable amount of time.
Contracted Services (Sec. 460.70)
Under the scope of benefits described in sections 1894(b)(1) and
1934(b)(1) of the Act, a PACE organization may enter into written
contracts with each outside entity to furnish services to participants.
Consequently, we require that all services, except for emergency
services as described in Sec. 460.100, not furnished directly by a PACE
organization must be obtained through contracts which meet the
requirements specified in regulations. We are adopting the contracting
provisions in Part VII, section A of the Protocol.
A PACE organization can only contract with entities that meet all
applicable Federal and State
[[Page 66244]]
requirements. We have provided some examples of the types of
requirements that contractors would be expected to meet. The contractor
must be accessible, i.e., located within or near the PACE
organization's service area.
To avoid breakdowns in communication or in the provision of care,
we require a PACE organization to designate an official liaison to
coordinate activities between contractors and the organization.
Effective coordination of services is necessary to avoid duplicative or
conflicting services. Designating an individual as liaison provides a
conduit for sharing information. The liaison would inform contractors
of PACE organization policies, changes in participants' plans of care,
information from team meetings, and quality improvement activities and
goals. Contractor staff would inform the PACE organization, through the
liaison, of updates and changes in a participant's status, personnel
changes in the contractor, and any other information necessary for the
continuity of participant care. All care must be evaluated by the PACE
organization, with particular attention to care provided by contracted
personnel. This requirement provides a mechanism to ensure that
contracted personnel are adhering to organization policies and
procedures. It also affords the organization an opportunity to identify
any education or training needs of contracted personnel.
The PACE center is required to maintain a current list of
contractors and provide a copy to anyone upon request. Copies of signed
contracts for inpatient care must be furnished to HCFA and the State
administering agency.
Under the specific contract content requirements, we require each
contract to be in writing and contain the following information:
Name of contractor.
Services furnished.
Payment rate and method.
Terms of the contract, including the beginning and ending
dates, as well as methods of extension, renegotiation and termination.
Contractor agreement to: furnish only those services
authorized by the PACE multidisciplinary team; accept payment from the
PACE organization as payment in full and not to bill participants,
HCFA, the State Medicaid agency or private insurers; hold harmless
HCFA, the State and PACE participants in the event that the PACE
organization cannot or will not pay for services performed by the
contractor pursuant to the contract; not assign or delegate duties
under the contract unless prior written approval is obtained from the
PACE organization; and submit reports as required by the PACE
organization.
We have not established a specific notice requirement for
termination of contracts. We believe that PACE organizations will
contract with individuals and entities that understand and embrace the
organization's mission and commitment to participants. As discussed
previously, the governing body is required to establish personnel
policies that address adequate notice of termination by contractors and
employees with direct patient care responsibilities to permit an
orderly transition and avoid disruptions in care. We specifically
request public comment on whether we should add a requirement for
notice before a contractor could terminate its contract.
Physical Environment (Sec. 460.72)
To ensure that the center and home are free of hazards that may
cause harm to the participants, staff, or visitors, we have established
Sec. 460.72. Because issues of adequate space, infection control, fire
prevention, dietary services, and the safety of transportation services
are important to ensure quality care, we have added requirements for
each in this condition.
We have maintained the following requirements from the PACE
Protocol with a few clarifications:
The PACE center must be designed, constructed, equipped,
and maintained to provide for the physical safety of participants,
personnel, and visitors;
The PACE center must ensure a safe, sanitary, functional,
accessible and comfortable environment for the delivery of services,
that protects the dignity and privacy of the participant; and
The PACE center must include sufficient suitable space and
equipment to provide primary medical care and suitable space for team
meetings, treatment, therapeutic recreation, restorative therapies,
socialization, personal care and dining. (We believe that a PACE
organization should furnish primary care services in the center, but
this provision allows flexibility to avoid duplicating an entire
primary care clinic if that is not necessary.)
The PACE organization must establish, implement, and maintain a
written plan to ensure that all equipment is maintained in accordance
with the manufacturer's recommendations to keep all equipment
(mechanical, electrical and patient care) free of defect. Based on the
manufacturer's experience with the equipment, we believe it has the
most knowledge about routine maintenance and recommended repair
schedules necessary to keep the equipment in good operating condition.
The Life Safety Code (LSC) is a set of fire protection requirements
designed to provide a reasonable level of safety from fire. The LSC was
developed by the National Fire Protection Association and adopted by
the Department of Health and Human Services as the standard which
ensures reasonably fire-safe facilities. The LSC specifies requirements
for building construction features such as walls and doors, exits and
exit access, and fire protection devices such as sprinklers, smoke
detectors, and fire extinguishers.
The 1997 edition of the LSC is divided into occupancy chapters,
including Business, Education, and Health Care Occupancies. Business
occupancies include clinics and offices, and educational occupancies
cover schools and day care centers. Health care occupancies include
facilities where the patients are rendered incapable of self-
preservation and where they remain overnight. Unfortunately, the LSC
does not designate a specific category for comprehensive outpatient
services provided to nursing home eligibles, so we have chosen to
stipulate that the PACE center must meet the occupancy provisions of
the 1997 edition of the LSC for the type of setting in which it is
located (i.e., hospital, office building, etc.).
Each type of LSC occupancy requires a fire alarm system. A fire
alarm system must provide three functions: (1) Initiation--a method of
initiating the alarm, such as a pullbox; (2) notifications--a method of
notifying the occupants, such as a loud bell, horn, chimes, or flashing
lights for those patients who are deaf; and (3) control--a method of
controlling other fire protection functions and features, such as air
conditioning shutdown, automatic release (closing) of fire doors, etc.
We require a PACE center to meet the requirements for a fire alarm
system in accordance with the occupancy section of the LSC that applies
to its building. Each occupancy section also requires evacuation plans,
fire exit drills, and fire procedures. The purpose of the drills is to
test the efficiency, knowledge, and response of the staff and to ensure
that safe care will be provided to participants during an emergency.
The statute and implementing regulations governing some Medicare
providers (i.e., nursing facilities, hospitals, hospices) authorize us
to accept a State code in lieu of the LSC
[[Page 66245]]
if it adequately protects patients. Likewise, under these regulations
the LSC will not apply in a State where HCFA finds that a fire and
safety code imposed by State law adequately protects PACE participants
and staff.
We recognize that it could be burdensome to require strict
adherence to all of the requirements of the LSC. PACE centers may be
established in a variety of building types (e.g., hospitals or office
buildings), which must be considered in requiring adherence to the LSC.
We also recognize that some centers may have alternative features that
provide an equivalent level of protection to that required by the
specific requirements of the LSC. In some buildings it may even be
impractical or impossible to provide a specific feature due to the
construction of the building. Therefore, we have specified that HCFA
may waive specific provisions of the LSC which, if rigidly applied,
would result in unreasonable hardship on the organization. Specific
provisions may be waived only if the waiver does not adversely affect
the health and safety of the participants and staff.
We have established four requirements that we believe are
fundamental for a PACE organization to effectively prepare for
emergency situations. The PACE organization must establish, implement,
and maintain documented procedures to manage medical and nonmedical
emergencies or disasters that are likely to threaten the health or
safety of participants, staff or the public including, but not limited
to, fire, equipment, water or power failures, care-related emergencies,
and natural disasters likely to affect their geographic location. We
also state that we do not expect organizations to develop emergency
plans for natural disasters that typically do not affect their
geographic area. For example, organizations in the Southeast would not
typically need to develop emergency procedures for earthquakes.
PACE organizations must train each staff member (employee and
contractors) on the actions necessary to address different medical and
nonmedical emergencies. This requirement is designed to ensure the
safety and security of both the participants and the staff. In
addition, the participants must be appropriately trained on the
organization's emergency procedures since they may need to take steps
to protect themselves during an emergency. PACE participants need to be
informed on what to do, where to go, and whom to contact if a center
emergency occurs. The PACE center must also provide periodic
orientation to staff and participants.
Appropriate medical practice dictates that the organization must
have trained personnel, drugs, and emergency equipment immediately
available at every center at all times to adequately support
participants until an Emergency Medical System (EMS) responds to the
center. We have defined the minimum emergency equipment that must be on
the premises and immediately available as easily portable oxygen,
airways, suction, and emergency drugs. In addition, the center must
have a documented plan to obtain EMS services from sources outside the
center when needed.
At least annually, a PACE organization must actually test,
evaluate, and document the effectiveness of its emergency and disaster
plans to ensure appropriate responses to the situations and needs that
may arise from both medical and nonmedical emergencies. Drills and
emergency episodes often reveal a weakness or flaw in the design of the
emergency plan. An annual review will allow flaws or potential problems
to be identified and corrected.
Infection Control (Sec. 460.74)
Infection control is vital to the health and safety of
participants, so we are requiring in Sec. 460.74 that the PACE
organization adhere to accepted policies and standard procedures,
including at least the standard precautions developed by and available
from the Centers for Disease Control and Prevention (CDC). These
guidelines have been developed by the CDC in collaboration with
industry representatives and have proven effective as a means of
diminishing the spread of blood-borne pathogens and other infectious
agents. The PACE organization must establish, implement, and maintain a
documented infection control plan that will assure a safe and sanitary
environment and prevent and control the transmission of disease and
infection. At a minimum, the infection control plan must include the
following:
(1) Procedures to identify, investigate, control, and prevent
infections in every center and in a participant's place of residence;
(2) Procedures to record any incidents of infection; and
(3) Procedures to analyze the incidents of infection, to identify
trends, and develop corrective actions related to the reduction of
future incidents.
Transportation Services (Sec. 460.76)
Transportation services are a critical component of PACE service
delivery, so it is crucial that the PACE organization take appropriate
steps to ensure that participants can be safely transported from their
homes to the center and to appointments. We have established
Sec. 460.76 to require that the PACE organization's transportation
services must be safe, accessible and equipped to meet the needs of
each participant. In addition, we require that the organization's
transportation program include procedures on at least the following:
(1) Maintenance of transportation vehicles according to the
manufacturer's recommendations; (2) equipping transportation vehicles
to communicate with the PACE center; (3) training transportation
personnel on the special needs of participants and appropriate
emergency response; and (4) as part of the multidisciplinary team
process, communicating relevant changes in the participants' care plans
to transportation personnel.
Dietary Services (Sec. 460.78)
It is important that each PACE center provide each participant with
a nourishing, palatable, well-balanced meal that meets the daily
nutritional and special dietary needs of each participant. Each meal
must be: prepared by methods that conserve nutritive value, flavor, and
appearance; prepared in a form designed to meet individual needs; and
prepared and served at the proper temperature. The center must provide
substitute foods or nutritional supplements that meet the daily
nutritional and special dietary needs of any participant who refuses
the food served, cannot tolerate the food served, or who does not eat
adequate amounts. In addition, the PACE organization must provide
nutrition support (that is, tube feedings, total parenteral nutrition,
or peripheral parenteral nutrition) to meet the daily nutritional needs
of a participant if indicated by his or her medical condition or
diagnosis.
It is vital to the health and safety of participants that the food
provided meets acceptable safety standards. Therefore, we are requiring
the PACE organization to:
(1) Procure foods (including nutritional supplements and items to
meet special nutrition needs) from sources approved or considered
satisfactory by Federal, State, Tribal or local authorities that have
jurisdiction over the service area of the organization;
(2) store, prepare, distribute, and serve foods (including
nutritional supplements and items to meet special nutrition needs)
under sanitary conditions; and
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(3) dispose of garbage and refuse properly.
Fiscal Soundness (Sec. 460.80)
Part I, section F of the Protocol addresses fiscal soundness and
paragraph (e)(4)(A)(ii) of sections 1894 and 1934 of the Act requires
that during the trial period we conduct a comprehensive assessment of a
PACE organization's fiscal soundness. We have established Sec. 460.80
to address requirements for fiscal soundness.
Each PACE organization must have a fiscally sound operation as
demonstrated by total assets being greater than total unsubordinated
liabilities, sufficient cash flow and adequate liquidity to meet
obligations as they become due, and a net operating surplus or a plan
for maintaining solvency.
Each organization must have a documented insolvency plan approved
by HCFA and the State administering agency which, in the event of
insolvency, provides for: the continuation of benefits for the duration
of the period for which capitation payment has been made; the
continuation of benefits to participants who are confined in a hospital
on the date of insolvency until their discharge; and protection of
participants from liability for payment of any fees which are the legal
obligation of the PACE organization.
Each organization must have adequate arrangements to cover expenses
in the event it becomes insolvent. To this end, we have specified
requirements in this section that are consistent with the Protocol.
Marketing (Sec. 460.82)
Based on Part III, section B of the Protocol, we have established
Sec. 460.82 to address marketing of PACE programs. PACE organizations
must conduct marketing activities that inform the general public about
their programs.
All marketing material must be approved by HCFA and the State
administering agency. Initial marketing material is reviewed as part of
the application process. After an organization is under a PACE program
agreement, any new or revised marketing materials must be submitted for
review by HCFA and the State administering agency. We will complete our
review within 45 days after we receive the information from the
organization or the material will be deemed approved. We have added the
requirement for review and approval of revised marketing materials
since revisions could potentially introduce false or misleading
information. Although the Protocol includes a 30-day review and
approval timeframe, we adopted a 45-day period to be consistent with
the process used by HCFA for review of changes to Medicare+Choice
organization marketing materials.
Printed marketing materials must meet participants' special
language requirements. Marketing materials must provide complete and
clear information regarding the requirement that all services (other
than emergency services), including primary care and specialist
physician services, be furnished by or authorized by the PACE
organization and that participants may be fully and personally liable
for the costs of unauthorized or out-of-PACE program agreement
services.
PACE organizations must ensure that their employees or agents do
not conduct prohibited marketing activities such as discrimination of
any kind among individuals who meet PACE eligibility standards;
activities that could mislead or confuse potential participants or
misrepresent the PACE organization, HCFA, or the State administering
agency; activities that involve gifts or payments to induce enrollment;
contracting outreach efforts to individuals or organizations whose sole
responsibility involves direct contact with the elderly to solicit
enrollment; or unsolicited door-to-door marketing.
Each PACE organization must establish, implement, and maintain a
documented marketing plan with measurable enrollment objectives and a
system for tracking its effectiveness.
Subpart F--PACE Services
PACE Benefits Under Medicare and Medicaid (Sec. 460.90)
Pursuant to sections 1894(a)(2)(B) and (b)(1) and 1934(a)(2)(B) and
(b)(1) of the Act, we have established Sec. 460.90 to specify that
Medicare and Medicaid benefit limitations and conditions relating to
amount, duration, scope of services, deductibles, copayments,
coinsurance, or other cost sharing do not apply to PACE benefits. In
addition, we have specified that, in accordance with sections
1894(a)(1)(B)(i) and 1934(a)(1)(A) of the Act, the PACE participant
shall receive Medicare and Medicaid benefits solely through the PACE
organization.
Required Services (Sec. 460.92)
Based on the provisions of sections 1894(b)(1)(A) and 1934(b)(1)(A)
of the Act, we are requiring in Sec. 460.92 that each PACE benefit
package include for all participants, regardless of source of payment,
all Medicaid covered services as specified in the State's approved
Medicaid plan, a variety of services specified in the Protocol, and
other services determined necessary by the multidisciplinary team to
meet the participant's needs (e.g., respite care). As specified in Part
IV, section A.3 of the Protocol, at a minimum the PACE organization
must provide the following benefit package:
Multidisciplinary assessment and treatment planning;
Primary care services including physician and nursing
services;
Social work services;
Restorative therapies, including physical therapy,
occupational therapy and speech-language pathology;
Personal care and supportive services;
Nutritional counseling;
Recreational therapy;
Transportation;
Meals;
Medical specialty services including, but not limited to:
anesthesiology, audiology, cardiology, dentistry, dermatology,
gastroenterology, gynecology, internal medicine, nephrology,
neurosurgery, oncology, ophthalmology, oral surgery, orthopedic
surgery, otorhinolaryngology, plastic surgery, pharmacy consulting
services, podiatry, psychiatry, pulmonary disease, radiology,
rheumatology, surgery, thoracic and vascular surgery, and urology;
Laboratory tests, x-rays and other diagnostic procedures;
Drugs and biologicals;
Prosthetics and durable medical equipment, corrective
vision devices such as eyeglasses and lenses, hearing aids, dentures,
and repairs and maintenance for these items;
Acute inpatient care: ambulance; emergency room care and
treatment room services; semi-private room and board; general medical
and nursing services; medical surgical/intensive care/coronary care
unit, as necessary; laboratory tests, x-rays and other diagnostic
procedures; drugs and biologicals; blood and blood derivatives;
surgical care, including the use of anesthesia; use of oxygen;
physical, occupational, and respiratory therapies; speech-language
pathology; and social services.
Nursing facility care: semi-private room and board;
physician and skilled nursing services; custodial care; personal care
and assistance; drugs and biologicals; physical, occupational, and
recreational therapies and speech-language pathology, if necessary;
social services; and medical supplies and appliances.
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Required Services for Medicare Participants (Sec. 460.94)
In accordance with paragraph (b)(1)(A)(i) of sections 1894 and 1934
of the Act, we specify that the PACE benefit package for Medicare
participants must include, in addition to the services required by
Sec. 460.92, the scope of hospital insurance benefits described in 42
CFR part 409 and the scope of supplemental medical insurance benefits
described in 42 CFR part 410.
This provision is based on explicit statutory wording that requires
the inclusion of Medicare covered services only for individuals
enrolled under section 1894 of the Act. Those individuals include
Medicare-only participants and dually-eligible Medicare/Medicaid
participants. The PACE organization may choose to include coverage of
these services for other participants, but is not required to do so.
In accordance with section 1894(g) of the Act, we specify that the
following requirements of title XVIII of the Act (and regulations
relating to such requirements) are waived and do not apply to services
under the PACE program:
The provisions of subpart F of part 409 of 42 CFR that
limit coverage of institutional services;
The provisions of subparts G and H of 42 CFR part 409 and
parts 412 through 414 that relate to rules for payment for benefits;
The provisions of subparts D and E of 42 CFR part 409 that
limit coverage of extended care services or home health services;
The provisions of subpart D of 42 CFR part 409 that impose
a 3-day prior hospitalization requirement for coverage of extended care
services; and
The provisions of 42 CFR 411.15(g) and (k) that may
prevent payment for PACE program services to individuals enrolled in
the PACE program.
Excluded Services (Sec. 460.96)
We provide a list of excluded services based on Part IV, section
A.6 of the Protocol. The services that are excluded from coverage under
the PACE program are as follows:
Any service that is not authorized by the
multidisciplinary team, even if it is listed as a required service,
unless it is an emergency service .
For services in inpatient facilities, private room and
private duty nursing services, unless medically necessary, and non-
medical items for personal convenience such as telephone, radio or
television rental, unless specifically authorized by the
multidisciplinary team as part of a participant's plan of care.
Cosmetic surgery, which does not include surgery required
for improved functioning of a malformed part of the body resulting from
an accidental injury or for reconstruction following mastectomy.
Experimental medical, surgical or other health procedures.
Services rendered outside the United States, except as may
be permitted in accordance with 42 CFR 424.122 and 424.124 or as may be
permitted under the State's approved Medicaid Plan. While the Protocol
did not recognize any exceptions, the required inclusion of Medicare
and Medicaid covered services results in certain limited exceptions
being possible. For example, a State that borders another country might
include some Medicaid coverage across the border, and Medicare covers
some emergency hospital, ambulance, and physician services outside the
United States. (As defined in 42 CFR 400.200, the United States
includes the Commonwealth of Puerto Rico, the Virgin Islands, Guam,
American Samoa, and the Northern Mariana Islands.)
Service Delivery (Sec. 460.98)
We are requiring in Sec. 460.98 that the PACE organization must
establish and implement a written plan to provide care that meets the
needs of its participants across all care settings on a 24 hour basis,
each day of the year. The PACE organization must furnish comprehensive
medical, health, and social services that integrate acute and long-term
care. These services must be furnished at least in the PACE center, the
participant's home, and inpatient facilities. The PACE organization
must not discriminate against any participant in the delivery of
required PACE services based on race, ethnicity, national origin,
religion, sex, age, mental or physical disability, or source of
payment.
The requirements in this section implement provisions in Part IV,
section B of the Protocol and ensure the availability of and access to
services as a PACE organization grows. The following requirements are
based on the Protocol:
At least the following services must be furnished at every
PACE center: primary care (including physician and nursing services);
social services; restorative therapies (including physical and
occupational therapy); personal care and supportive services;
nutritional counseling; recreational therapy; and meals.
The PACE organization must operate at least one PACE
center either in or contiguous to its designated service area, with
sufficient capacity for routine attendance by its participants.
The PACE organization must ensure accessible and adequate
services to meet the needs of all its participants. When necessary, the
organization must increase the number of centers, staff, and other PACE
services.
The frequency of a participant's attendance at the center
is determined by the multidisciplinary team based on the needs and
desires of each participant.
We added the requirement that, if there is more than one center,
each center must offer the full range of services and have sufficient
staff to meet the needs of participants.
Emergency Care (Sec. 460.100)
We expanded on and clarified the provisions in Part IV, section A
of the Protocol to ensure access to necessary services and to adopt a
beneficiary-centered approach.
We require a PACE organization to establish and maintain a written
plan for handling emergency health care needs. The organization must
ensure that the participants and caregivers know when and how to access
emergency services and ensure that HCFA, the State, and PACE
participants are held harmless if the PACE organization does not pay
for emergency services.
Emergency care is appropriate when services are needed immediately
because of an injury or sudden illness and the time required to reach
the PACE organization or a network provider would cause risk of
permanent damage to the participant's health. Thus, emergency care
services include inpatient and outpatient services, furnished by a
qualified emergency services provider (other than the PACE organization
or one of its contract providers) either in or out of the PACE
organization's service area, that are needed to evaluate or stabilize
an emergency medical condition. An emergency medical condition means a
condition manifesting itself by acute symptoms of sufficient severity
(including severe pain) such that a prudent layperson, with an average
knowledge of health and medicine, could reasonably expect the absence
of immediate medical attention to result in: serious jeopardy to the
health of the participant; serious impairment to bodily functions; or
serious dysfunction of any bodily organ or part.
Emergency services that fall within this description do not require
prior
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authorization by the PACE organization. We believe that relying on the
prudent layperson standard in establishing a participant's need for
emergency services is more clear than the definition of emergency care
in the Protocol. We adopted the prudent layperson standard from the
Consumer's Bill of Rights and Responsibilities (discussed in detail in
the section on participant rights). The same standard is used in the
Medicare+Choice definition of emergency medical condition. This
standard encompasses a slightly broader range of circumstances than
does the Protocol language, by including some situations that could fit
under the Protocol description of ``urgent care'' or ``urgently needed
services.'' We think this clarification is helpful because the Protocol
wording does not clearly distinguish between emergency and urgent care.
Other services a participant may need while temporarily absent from
the PACE organization's service area, that are not emergency services
but cannot be delayed until the participant returns, would need prior
authorization. The fact that these services may be ``urgently needed''
means that the PACE organization would be expected to authorize a
participant to obtain them from a non-contract provider outside of the
service area, but it does not exempt them from the requirement for
prior authorization. This approach differs from that applied to
Medicare+Choice organizations, where prior authorization for urgently
needed services is not required. We believe that the differences in the
population served by PACE organizations warrant different treatment of
urgent, though not emergency, care needs. Due to the relative frailty,
more limited mobility, and more complex health status of PACE
participants, we believe the need to maintain coordination of care by
the multidisciplinary team justifies contact with and authorization by
the PACE organization prior to receipt of non-emergency care outside
the PACE network.
The emergency services plan must provide for the availability of
appropriate on-call providers. We expanded this requirement from the
Protocol to provide a safety net for unanticipated health incidents, so
participants do not encounter difficulty obtaining care when they are
away from the PACE center, when they are away from the PACE
organization's service area and require services that cannot be delayed
until they return, or when they require post-stabilization care
services following emergency services. An on-call provider must be
available 24-hours per day to address any participant questions about
accessing emergency services and respond to requests for authorization
of urgently needed out-of-network services or post-stabilization care
services following emergency services.
We believe that PACE organizations are organized to be responsive
to all participant care needs, including the need for urgently needed
or post-stabilization services. However, in order to ensure that
unforeseen circumstances do not result in delays in needed care, we
have clarified that the PACE organization must cover urgently needed
out-of-network or post-stabilization care services if it does not
respond to a request for approval within 1 hour after being contacted
or cannot be contacted for approval.
Multidisciplinary Team (Sec. 460.102)
This section is based on provisions in Part IV, section B of the
Protocol. The Protocol requires that the PACE organization assign each
participant to a multidisciplinary team based at the PACE center where
the participant attends. We have included a requirement that the PACE
organization must establish a multidisciplinary team at each center to
comprehensively assess and meet the individual needs of each
participant. We believe that a well-functioning multidisciplinary team
is critical to the success of the PACE program, as the team is
instrumental in controlling the delivery, quality, and continuity of
care. Members of the multidisciplinary team should be knowledgeable
about the overall needs of the patient, not just the needs which relate
to their individual disciplines. In order to meet all of the health,
psychosocial, and functional needs of the participant, team members
must view the participant in a holistic manner and focus on a
comprehensive care approach.
Based on the Protocol, we are requiring that the multidisciplinary
team be composed of at least the following members:
a. Primary Care Physician--We considered expanding this to include
nurse practitioners but decided to retain the requirement in the
Protocol. While it would be acceptable for a PACE organization to
include a nurse practitioner on the multidisciplinary team, we believe
that this should be in addition to rather than instead of the primary
care physician. The physician is an integral part of the team serving
as a gatekeeper for the participant's medical care, and we feel it is
important to retain this standard in order to ensure quality care.
b. Registered Nurse--The Protocol requires the inclusion of a
``nurse.'' We are specifying that this team member be a registered
nurse. The nurse represented on the multidisciplinary team must exhibit
leadership and management skills that are more consistent with the
training received by registered nurses, as opposed to licensed
practical nurses. In addition, we believe that a registered nurse would
be better able to determine and respond to the health care needs of the
frail population, particularly for home care services. We welcome
comments on this issue.
c. Social Worker;
d. Physical Therapist;
e. Occupational Therapist;
f. Recreational Therapist or Activity Coordinator;
g. Dietitian;
h. PACE Center Manager--We have changed the Protocol terminology
from ``PACE Center Supervisor'' to ``PACE Center Manager''. The center
manager is responsible for overall operation of the PACE center and
ensuring service delivery. The individual who holds this position
should be a good facilitator and should possess good communication
skills. She or he could be the leader of the multidisciplinary team,
but we are not requiring this. We are giving the PACE organization and
the multidisciplinary team the flexibility to decide who should lead
the team and facilitate the discussions.
i. Home Care Coordinator--Since PACE services may be furnished in
the home, the coordination of in-home services with PACE center and
primary care services is critical to effective service delivery. This
coordination is especially important if the PACE organization has
contractors providing the home care services. The PACE organization
must designate a home care coordinator to supervise and coordinate home
care services, whether these services are furnished by a PACE employee
or through a contractor. We are changing the Protocol's term ``home
care liaison'' to ``home care coordinator'', because ``home care
liaison'' has another meaning in Medicare and we want to avoid
confusion.
j. Personal care attendants or their representatives--We have
changed the Protocol term ``health care worker/aide'' to ``personal
care attendant'', as we believe this term more accurately describes
this type of worker. We believe that ``health care worker'' is too
general and could apply to other members of the team.
[[Page 66249]]
k. Drivers or their representatives--This requirement remains
unchanged from the Protocol.
Due to the age of PACE participants, a geriatrician could be a
valuable member of the multidisciplinary team. As one option, the
primary care physician could be a geriatrician. However, physicians who
specialize in geriatrics are relatively rare and availability might be
a serious problem. We have not required the involvement of a
geriatrician but we welcome comments about whether such a requirement
would be desirable and, if so, whether the geriatrician should be
employed by the PACE organization and should primarily serve PACE
participants.
Consistent with the Protocol, we are requiring that primary medical
care for all participants be furnished by the PACE primary care
physician(s). The primary care physician must serve as the gatekeeper
to the participant's use of medical specialists and inpatient care, and
he or she must be an integral member of the multidisciplinary team.
Ultimate responsibility for management of medical situations must rest
with the PACE primary care physician.
The multidisciplinary team is responsible for the initial
assessment, periodic reassessments, the plan of care, and coordinating
24-hour care delivery. A critical element of the success of the
multidisciplinary team is the degree to which team members share
information and communicate with one another. The Protocol requires the
physician to keep the multidisciplinary team informed of the medical
condition of each participant and to remain alert to pertinent input
from other team members. We feel this should be the responsibility of
each member of the team rather than just the physician, as it is
critical to timely intervention to address potential problems. We are
modifying the requirement to reflect this; i.e., each member of the
team must regularly inform the multidisciplinary team of the medical,
functional, and psychosocial condition of each participant and remain
alert to pertinent input from other team members, participants, and
caregivers. This communication can take place through formal measures
such as team meetings and written documentation in participants'
medical records, but should not be limited to formal mechanisms;
informal communication between team members (e.g., CARDEX systems,
informal updates during shift changes and as different personnel report
to work) should be encouraged as well. It is critical that personal
care attendants be involved in the communication process. Since they
often have the first contact with the participant, it is important that
they regularly share information on the participant's mood, activities,
daily habits, etc. Each team member must document changes in the
participant's condition in the participant's medical record.
We are retaining the Protocol requirement that members of the
multidisciplinary team must serve primarily PACE participants, unless a
waiver is granted. After considering this issue, we concluded that for
a frail elderly population, such as is served by the PACE program, it
is important to support and retain measures that promote quality and
continuity of care. If team members serve primarily PACE participants,
they are able to develop a rapport with participants and are better
able to plan for and provide their care. We recognize that team members
may have other patients, but this must not interfere with the provision
of services for PACE participants. HCFA and the State administering
agency may grant a waiver of this requirement if they determine that--
There are not enough individuals available in the PACE
organization's service area who meet the requirement; and
The proposed alternative does not adversely affect the
availability of care or the quality of care that is provided to
participants.
If an applicant seeking approval as a PACE organization believes a
waiver is warranted, it must include a request for the waiver in its
application and describe in detail the circumstances supporting the
request. For example, in a rural, Tribal, or urban Indian community the
number of PACE participants, or the availability of appropriate
multidisciplinary team members in some categories, may be insufficient
for some team members to primarily serve PACE participants. Such an
applicant would need to demonstrate that the alternative it proposes
will maintain the continuity of care and assure sufficient availability
of services so that participants receive prompt, effective care.
We are requiring that the PACE organization establish, implement
and maintain documented internal procedures governing the exchange of
information between team members, contractors, and participants and
their caregivers consistent with the requirements for confidentiality
in Sec. 460.200(e). It is important for the organization to develop
these procedures to avoid breakdowns in communication which would be
detrimental to the success of the PACE program. We also want to
emphasize the importance of regular communication from family members
and other caregivers and health care workers in the home. It is
critical that these individuals routinely report changes in participant
status to the multidisciplinary team.
Consistent with the Protocol, we are requiring that the following
members of the team be employees of the PACE organization: primary care
physician (unless an exception is granted), registered nurse, social
worker, recreational therapist or activity coordinator, PACE center
manager, home care coordinator, and PACE center personal care
attendants. It is important to note that ``personal care attendants''
in this context refers to individuals who work in the PACE center to
provide assistance to participants while they are at the center (e.g.,
assist medical staff, escort participants, bathe and toilet
participants) and does not refer to personal care attendants who
provide care to participants outside of the PACE center. Personal care
attendants who work in the home are not required to be employees of the
PACE organization.
HCFA and the State administering agency may grant a waiver of the
requirement that the primary care physician be employed by the PACE
organization if they determine that--
There are not enough physicians in the PACE organization's
service area who meet the PACE requirements or State licensing laws
make it inappropriate for the organization to employ physicians; and
The proposed alternative does not adversely affect the
availability or the quality of care that is provided to participants.
If an applicant seeking approval as a PACE organization believes a
waiver is warranted, it must include a request for the waiver in its
application and describe in detail the circumstances supporting the
request. For example, in a rural, Tribal, or urban Indian community the
number of PACE participants, or the availability of primary care
physicians, may be insufficient to make employment by the organization
a feasible option. As another example, some State licensing laws
prohibit the corporate practice of medicine, making it inappropriate
for the organization to employ physicians. Such applicants would need
to demonstrate that their contracts with physicians will maintain the
continuity of care and assure sufficient availability of services so
that participants receive prompt, effective care. We invite
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comments on whether this waiver provision is too broadly defined.
Participant Assessment (Sec. 460.104)
The information obtained through the participant assessment is the
basis for the treatment plan developed by the multidisciplinary team.
As such, it is important that the assessment be as comprehensive as
possible, in order to capture all of the information necessary for the
multidisciplinary team to develop a plan of care that will adequately
address all of the participant's functional, psychosocial, and health
care needs.
The assessment process begins before enrollment, as set forth in
Sec. 460.152, when the PACE organization evaluates whether a potential
participant can be cared for appropriately in the program. Often,
current PACE demonstration programs present a proposed plan of care to
the potential participant as part of the enrollment process. The
initial comprehensive assessment must be completed promptly following
enrollment, but individual team members' in-person assessment of the
participant should be scheduled at appropriate intervals based on the
participant's level of health. Because the initial assessments are
thorough, this will ensure that the participant is not overwhelmed with
several team members conducting assessments at one time. However, the
initial comprehensive assessment must be completed quickly so that the
plan of care can be completed and implemented without delay. This often
has been accomplished by the effective date of enrollment and should
never be delayed more than a few days beyond that date. With the team
concept, the goal is to obtain input from each discipline, as well as
from the participant, to perform an assessment that identifies the
services necessary to address the participant's needs and care
preferences.
As part of the initial comprehensive assessment, each of the
following members of the multidisciplinary team must individually
evaluate the participant in person and develop a discipline-specific
assessment of the participant's health and social status:
Primary care physician;
Registered nurse;
Social worker;
Physical therapist or occupational therapist, or both;
Recreational therapist or activity coordinator;
Dietitian; and
Home care coordinator.
These individuals represent the most vital components of the
participant's treatment and psychosocial development. These disciplines
are the core needed to determine the specific needs of the participant.
At the recommendation of individual team members, other professional
disciplines (e.g., speech-language pathology, dentistry, or audiology)
may participate in the initial comprehensive assessment if the
participant's needs warrant their inclusion.
HCFA is currently in the preliminary stages of developing a
standardized core assessment instrument to be used by PACE
organizations for continuous quality improvement. Until such time as
this instrument is completed, we are requiring that the participant's
assessment include, at a minimum, the following information:
physical and cognitive function and ability;
medication use;
participant and caregiver preferences for treatment;
socialization and availability of family support;
current health status and treatment needs;
nutritional status;
home environment, including home access and egress;
participant behavior;
psychosocial status;
medical and dental status; and
participant language.
We believe that this information will provide a basic framework
from which a comprehensive plan of care can be developed. This
assessment is appropriate for every participant, and ensures that the
plan of care focuses on the participant's medical, psychosocial, and
functional needs. However, this list represents the minimum information
to be included in the comprehensive assessment, and the PACE
organization is encouraged to include other assessment items as
necessary. HCFA may impose additional or more specific assessment
requirements upon development of the standardized core assessment
instrument.
The Protocol requires that the discipline-specific plans be
consolidated into a single plan of care for the participant. The
development of the plan of care must occur through discussion and
consensus of the entire multidisciplinary team. We are clarifying this
requirement by stating that the discussion must take place during team
meetings, in order to facilitate group discussion of the plan of care
and ensure that all members of the team are actively involved in the
decision-making process, and that the plan of care must be completed
promptly.
In developing the plan of care, the PACE multidisciplinary team is
also required to inform female participants that they are entitled to
choose a women's health specialist from the network of PACE providers.
We have included this requirement to be in compliance with the
Consumer's Bill of Rights and Responsibilities (discussed in more
detail later in this preamble in the section on participant rights).
This requirement is intended to ensure that female participants are
able to select providers who specialize in women's health for routine
and preventive care.
Reassessments are necessary to provide information to adjust
participants' plans of care. Periodic reassessments ensure the
continued accuracy and effectiveness of the participant's plan of care.
Consistent with the Protocol, we are requiring the following members of
the multidisciplinary team to conduct an in-person reassessment on at
least a semi-annual basis:
Primary care physician;
Registered nurse;
Social worker;
Recreational therapist or activity coordinator; and
Other team members actively involved in the development or
implementation of the participant's plan of care, for example, home
care coordinator, physical therapist, occupational therapist, or
dietitian.
The primary care physician, registered nurse, social worker, and
recreational therapist/activity coordinator are required to provide
assessments at least semi-annually as they are the most critical in
terms of defining outcomes of care. Other team members actively
involved in the participant's plan of care must also reassess
semiannually, as they have an impact on the care the participant is
receiving. If the participant is not receiving these other services
(e.g., home care, physical therapy, occupational therapy, dietitian
services), these members of the team would not be required to conduct a
semi-annual assessment.
Consistent with the Protocol, we are requiring the following
members of the multidisciplinary team to conduct an in-person
reassessment on at least an annual basis:
Physical therapist and/or occupational therapist;
Dietitian; and
Home care coordinator.
It is important for the multidisciplinary team to monitor and
respond to any changes in a participant's condition or family situation
or any concerns raised by the
[[Page 66251]]
participant or his or her designated representative. The Protocol
requires that the participant be reassessed by the team or by selected
members of the team to develop a new plan of care when the health
status or psychosocial situation of a participant changes. We believe
that at least all members of the multidisciplinary team that are
required to perform the initial comprehensive assessment should
reassess the participant. If fewer members participate in this
reassessment, a critical component of a participant's care might be
overlooked.
If a participant's health or psychosocial status has changed or if
a participant (or his or her designated representative) believes that a
particular service needs to be initiated, continued, or eliminated for
the participant, the appropriate multidisciplinary team members must
reassess the participant. The purpose of this reassessment is to
evaluate whether it is necessary to increase, continue, reduce, or
terminate particular services and whether a different course of
treatment is needed. A complete reassessment should ensure that the
participant is receiving a continuing program of care that meets his or
her current needs. Requiring a reassessment based on the concerns of
the participant emphasizes the active role the participant plays in the
assessment process and subsequent development of the plan of care. The
participant's adherence to the plan is critical to the successful
delivery of services. Therefore, permitting the participant (or
designated representative) to trigger a reassessment gives participants
the opportunity to express any dissatisfaction with the manner in which
any care or services will be furnished.
The PACE organization is required to have explicit procedures for
timely resolution of requests from participants (or designated
representatives) to initiate, continue, or terminate a particular
service. Unless an extension is granted, the multidisciplinary team
must notify the participant (or designated representative) of its
decision to approve or deny the request as expeditiously as the
participant's condition requires, but no later than 72 hours after the
multidisciplinary team receives the request. We considered establishing
both a standard process and an expedited process for responding to a
participant request; however, because of the frailty of this
population, we concluded that every request is urgent and requires a
quick response. We want to ensure that a participant's health is not
adversely affected due to a delay in reassessing the participant's
condition. The goal of the program is to maximize the participant's
functioning, and a quick response is meant to ensure that all factors
are evaluated, all necessary services are being furnished, and
participant health is not compromised. A timely notification also
allows participants adequate time to consider appeal rights, if
necessary, without compromising their health.
The multidisciplinary team may extend the 72-hour timeframe by no
more than 5 additional days if the participant or designated
representative requests the extension, or the team documents its need
for additional information and how the delay is in the interest of the
participant. An extension could be warranted because not all the
appropriate members of the multidisciplinary team may always be able to
meet with the participant, conduct a discipline-specific reassessment,
discuss the results of the reassessment with the entire
multidisciplinary team, and develop a response to the request within 72
hours. The PACE organization retains the flexibility to determine the
most appropriate manner in which to provide notification to the
participant (or designated representative).
If, based on the reassessment, the multidisciplinary team decides
to deny the participant's request, the denial must be explained to the
participant (or designated representative) orally and in writing. The
PACE organization must provide the specific reasons for the denial in
understandable language.
If the participant (or designated representative) is dissatisfied
with the outcome of the reassessment, the participant may appeal the
decision in accordance with Sec. 460.122. Specifically, the PACE
organization must: (1) Inform the participant or designated
representative of his or her right to appeal the decision; (2) describe
both the standard and expedited appeals processes, including the right
to and conditions for obtaining an expedited appeal of a denial of
services; and (3) describe the right to and conditions for continuation
of contested services through the period of the appeal.
If the multidisciplinary team fails to provide the participant with
timely notice of the resolution of the request for reassessment or does
not furnish the services required by the revised plan of care, this
failure constitutes an adverse decision, and the participant's request
must be automatically processed as an appeal by the PACE organization
in accordance with Sec. 460.122.
Team members who reassess a participant must reevaluate the plan of
care. Any changes in the plan of care must be discussed and approved by
the multidisciplinary team and the participant (or designated
representative). The plan of care reflects the team's and participant's
goals for the participant's care. Obtaining the participant's approval
of the proposed plan of care is important to the successful delivery of
services and the participant's adherence to the plan.
In addition, we also require that any services included in the
revised plan of care as a result of a reassessment must be furnished to
the participant as expeditiously as the participant's health condition
requires. It is critical that care not be delayed and that the
participant receive comprehensive care that maintains his or her
functional status. Because we recognize that some changes in the
participant's plan of care (e.g., installing a wheelchair ramp at the
participant's home) may require more time to accomplish, we have chosen
not to specify a timeframe for delivering services. However, we are
soliciting comment on the necessity of requiring a specific timeframe.
Whenever a participant assessment or reassessment occurs, the
information must be documented in the participant's medical record.
Plan of Care (Sec. 460.106)
Based on Part IV, section B of the Protocol, we developed
requirements for the participant's plan of care. We are requiring that
the multidisciplinary team promptly develop a comprehensive plan of
care that specifies the care needed to meet the participant's medical,
physical, emotional, and social needs, as identified in the initial
comprehensive assessment. The plan of care must identify measurable
outcomes to be achieved and must be developed in collaboration with the
participant and her or his caregiver. The specified outcomes need not
be discipline-specific. Instead, these are team goals for the
participant's care. Involving the participant in the plan of care is
important to the successful delivery of services and the participant's
adherence to the plan.
We are requiring the team to implement, coordinate, and monitor the
plan of care by providing services directly and supervising the
delivery of services furnished by contract providers. The participant's
health and psychosocial status, as well as the effectiveness of the
plan of care, must be monitored continuously through the provision of
services, informal observation, input from participants and caregivers,
and communications among
[[Page 66252]]
members of the multidisciplinary team and other providers.
We are requiring that, on at least a semiannual basis, the
multidisciplinary team reevaluate the participant plan of care,
including the defined outcomes, and make changes as necessary.
Semiannual review of the participant's plan of care ensures that the
needs of the participant are being met. It allows the team to determine
if the participant's level of health has changed thus dictating a
change in the level of services or even the setting in which care must
be provided.
We are requiring that participant plans of care be developed,
reviewed, and reevaluated in collaboration with the participants or
caregivers. The purpose of participant/caregiver involvement is to
assure that they approve of the care plan and that participant concerns
are addressed. We are giving PACE organizations the flexibility to
determine how often care plans should be reviewed with the participant.
We welcome comments on the issue of whether or not to impose a
timeframe for this activity.
The participant's plan of care and any changes in the plan must be
documented in the participant's medical record.
Subpart G--Participant Rights
(Sections 460.110-460.118)
Introduction
In accordance with sections 1894(b)(2)(B) and 1934(b)(2)(B) of the
Act, the PACE program agreement requires the PACE organization to have
in effect, ``written safeguards of the rights of enrolled participants
(including a patient bill of rights and procedures for grievances and
appeals) in accordance with regulations and with other requirements of
this title and Federal and State law that are designed for the
protection of patients.'' In addition, sections 1894(f)(3) and
1934(f)(3) of the Act give us the discretion to apply such requirements
of part C of title XVIII and sections 1903(m) and 1932 of the Act
relating to protection of beneficiaries and program integrity as would
apply to Medicare+Choice organizations under part C and to Medicaid
managed care organizations under prepaid capitation agreements under
section 1903(m). Moreover, sections 1894(f)(2) and 1934(f)(2) of the
Act require us to incorporate the requirements in the PACE protocol
which includes a patient bill of rights.
We also have made every effort to assure that the rights and
protections established in the PACE agreement are in substantial
compliance with the Presidential Advisory Commission's (The Commission)
Consumer Bill of Rights and Responsibilities (CBRR), which appears as
an addendum to The Commission's Final Report to the President, entitled
Quality First: Better Health Care for All Americans (March 1998). (A
copy of the Final Report can be obtained by calling the Agency for
Health Care Policy and Research, Department of Health and Human
Services at 1-800-358-9295.) The President issued an Executive
Memorandum to the Secretary of the Department of Health and Human
Services dated February 20, 1998, which requires that, by December 31,
1999, Medicare and Medicaid health care programs be brought into
substantial compliance with the CBRR. The PACE program is included
within that framework.
In considering how to apply these patient protections, the statute
requires that we take into account the differences between the
populations served and benefits provided under PACE, Medicare+Choice,
and Medicaid managed care. We believe that the PACE program is unique
in its approach to meeting the needs of the frail elderly. Unlike most
managed care organizations which are responsible for meeting health
care needs alone, the PACE program is an integrated partnership between
the individual, the community, and the PACE organization, which is
dedicated to providing all-inclusive care to meet all medical and
social needs to enable the participant to remain in the community.
We believe it is important to establish participant rights that
reflect the differences in the PACE delivery approach from that of
other managed care systems. For example, since PACE participants
receive services most days of the week, either at the PACE center or
through home visits, PACE organizations are able to monitor changes in
a participant's medical condition and social service needs on a daily
basis. When PACE participants are referred to contracted specialists,
in most cases, the PACE organization makes the appointment, provides
transportation, and often provides an aide or other staff member to
accompany the participant. While managed care organizations may provide
this level of care management to some enrollees, PACE organizations do
so routinely for their entire participant census. Also, while managed
care organizations furnish a selected array of medical services, they
do not furnish all-inclusive care, including social and recreational
services intended to enhance participants' quality of life.
To reiterate the philosophy set forth in the PACE Protocol, the
PACE organization furnishes comprehensive services designed to: (1)
enhance the quality of life and autonomy for frail, older adults; (2)
maximize dignity and respect of older adults; (3) enable frail, older
adults to live in their homes and in the community as long as medically
and socially feasible; and (4) preserve and support the older adult's
family unit. The bill of rights for PACE participants must complement
and maintain this philosophy. We have relied on the PACE Protocol and
incorporated the basic rights that it identifies. However, we are also
guided by the Medicare+Choice regulations and by the CBRR.
We also recognize that the statute directs us to consider State
law. We have interpreted this to mean that a PACE organization's
participant bill of rights may include additional rights and
protections as required by State or local laws and regulations or
ethical considerations of particular concern, but only if these
additions or modifications provide stronger rights and protections than
those established in this regulation. Regardless, it is up to the PACE
organization to establish appropriate policies and procedures for
assuring that the participant bill of rights is fully operational
throughout the PACE organization.
Consistent with the Protocol and the CBRR, we have retained the
concept that participants can choose to be represented by family
members, caregivers, or other representatives. We intend that a
participant may designate a representative to exercise any or all of
the rights to which the participant is entitled.
We are requiring, as did the Protocol, the PACE organization to
provide encouragement and assistance to participants in understanding
and exercising their rights and in recommending changes in PACE
policies and services. In addition, it is likely that many of the frail
elderly or their chosen representatives will need guidance in
navigating the pre-enrollment, enrollment, and post-enrollment
processes of PACE. In the previous discussion on consultations with the
State Administration on Aging, we referred to the State Long Term Care
Ombudsman Programs. These State programs promote and monitor the
quality of care in nursing homes, including identifying and resolving
complaints, making regular visits to nursing homes, and generally,
improving the quality of care and
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quality of life of nursing home residents. The role of the ombudsman is
to engage in a variety of activities designed to encompass both active
advocacy and representation of residents' interests. We are
specifically requesting public comment on whether the ombudsman program
could play a role in consumer assistance to potential PACE
participants, as well as to those who have disenrolled and need
assistance in organizing their care. With regard to PACE participants,
we are also interested in receiving public input as to whether an
ombudsman could provide one-on-one consumer assistance to PACE
participants and their designated representatives to exercise their
rights and work effectively with the multidisciplinary team.
In Sec. 460.110, we require a PACE organization to have a written
participant bill of rights that is designed to protect and promote the
rights of each participant. The organization is required to inform
participants upon enrollment, in writing, of their rights and
responsibilities, and all rules and regulations governing
participation. In addition, the organization must protect participants'
rights and provide for the exercise of those rights.
Finally, there are numerous references throughout the regulations
to the PACE organization furnishing various kinds of information to
participants in writing. In order for this information to be
understandable and useful, it must be presented in a legible format.
The frail elderly PACE population would be expected to have vision
problems that make the use of sufficiently large, clear type
particularly important in written communications. While we are not
mandating the use of a particular typeface or font size, we expect PACE
organizations to ensure that documents are legible for their intended
audience.
Specific Participant Rights
Right #1--Respect and nondiscrimination. Each participant
has the right to considerate, respectful care from all PACE employees
and contractors at all times and under all circumstances. Each
participant has the right not to be discriminated against in the
delivery of required PACE services based on race, ethnicity, national
origin, religion, sex, age, mental or physical disability, or source of
payment.
The individual's right to respect and nondiscrimination is embedded
in the basic philosophy of the PACE program. Within this context, it is
essential that PACE participants are assured of the following rights:
(1) To receive comprehensive health care in a safe and clean
environment and in an accessible manner.
(2) To be treated with dignity and respect, be afforded privacy and
confidentiality in all aspects of care, and be provided humane care.
(3) Not to be required to perform services for the PACE
organization.
(4) To have reasonable access to a telephone.
(5) To be free from harm, including physical or mental abuse,
neglect, corporeal punishment, involuntary seclusion, excessive
medication, and any physical or chemical restraint imposed for purposes
of discipline or convenience and not required to treat the
participant's medical symptoms.
(6) To be encouraged and assisted to exercise rights as a
participant, including the Medicare and Medicaid appeals processes as
well as civil and other legal rights.
(7) To be encouraged and assisted to recommend changes in policies
and services to PACE staff.
The following discussion provides the rationale for inclusion of
these rights. In keeping with the PACE model, we recognize the
participant's right to receive comprehensive care in a safe and clean
environment and in an accessible manner. The Protocol states that a
PACE participant must receive treatment and rehabilitative services. We
have expanded this requirement to state that the participant has a
right to receive comprehensive health care. The PACE organization must
offer and manage all health, medical, and social services needed to
restore or preserve the participant's independence. The PACE
multidisciplinary team must arrange for preventive, rehabilitative,
curative, and supportive services in adult day health centers,
participant homes, hospitals, and nursing homes. The revised language
addresses the complete range of services in each setting that a
participant is entitled to, once enrolled in the PACE organization.
The Protocol stipulates that the participant has the right to have
dignity, privacy, and humane care. For purposes of clarification, we
require the PACE organization to treat the participant with dignity and
respect, to afford the participant privacy and confidentiality in all
aspects of care, and to provide humane care. The PACE organization must
assure that a participant's dignity and privacy are respected not only
in its own facilities but also in affiliated or contract providers.
Staff should be instructed that any discussions with participants
regarding treatment, the participant care plan, and medical conditions
should be held in private and kept confidential. While recognizing the
participant's right to privacy and confidentiality, we are not
advocating physical barriers because participants should be in the view
of the staff at all times to ensure safety. However, in situations
where there is participant body exposure during treatment, the staff
should be instructed to provide temporary screens or curtains.
We have adopted from the Protocol the right to be free from harm,
including physical or mental abuse, neglect, corporeal punishment,
involuntary seclusion, excessive medication, and inappropriate use of
physical or chemical restraints. We have revised the wording used in
the Protocol regarding the use of restraints. We do not view this as a
policy change from the protocol, but felt the rewording was necessary
to emphasize that the use of restraints must be limited to those
situations with adequate, appropriate clinical justification. The use
of restraints must be based on the assessed needs of the patient, be
monitored and reassessed appropriately, and be ordered for a defined
and limited period of time. The least restrictive and most effective
method available must be utilized and it must conform to the patient's
plan of care. Restraints may only be used as a last resort and must be
removed or ended at the earliest possible time. We do not believe that
restraints of any kind should ever be used as a preferred approach to
care and we expect PACE organizations to ensure that their programs are
``restraint free'' to the greatest extent possible. Specific
requirements regarding the use of restraints are established in
Sec. 460.114.
We are in the midst of examining our seclusion and restraint policy
for all HCFA-covered providers. We call your attention to the
discussion of the use of seclusion and restraints in the HCFA interim
final rule with comment concerning the conditions of participation for
hospitals (HCFA-3018-IFC, published July 2, 1999, 64 FR 36070). In that
regulation, we have established very explicit standards for the use of
seclusion and restraints both in medical/surgical care and for behavior
management (see Sec. 482.13(e) and (f)). While the standards are not
identical to those we have included in Sec. 460.114, they share the
common principle that patients have the right to be free from
restraints of any form that are not medically or psychiatrically
necessary or are used as means of coercion, discipline, convenience, or
retaliation by staff. In the preamble for the hospital conditions of
participation, we indicate our intent to examine the
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applicability of the hospital restraint and seclusion standards to
other providers. Therefore, we formally ask for comments about how best
to extend the protections proposed for hospital patients to
participants in the PACE program.
We have also adopted the rights established in the Protocol to
encourage and assist the participant to exercise his or her rights,
including the Medicare and Medicaid appeals processes, as well as civil
and legal rights and we have maintained the right to telephone access.
On the other hand, we have altered the right not to be required to
perform services for the organization unless the services are included
for therapeutic purposes in the plan of care. Upon reflection, it is
our belief that a therapeutic program should not be tied to performing
services for the PACE organization.
The CBRR specifies that organizations should not discriminate on
the basis of race, ethnicity, national origin, religion, sex, age,
mental or physical disability, or source of payment. PACE organizations
are required to comply with all Federal, State, and local laws,
including discrimination statutes with regard to marketing, enrollment,
and provision of services. However, we recognize that, with regard to
health status considerations, PACE organizations are required as part
of the intake process to assess whether a potential participant is
appropriate for PACE, that is, meets the State's nursing home
eligibility standard but can be cared for in the community. Meeting
required certification standards within the PACE context is not deemed
a violation of antidiscrimination laws. Still, in order to ensure that
the qualification decision is free from other, illegal forms of
discrimination, we are requiring PACE organizations to retain
information on individuals who are assessed but, for whatever reason,
are not enrolled.
Right #2--Information disclosure. Each PACE participant
has the right to receive accurate, easily understood information and to
receive assistance in making informed health care decisions.
Specifically, each participant has the right:
(1) To be fully informed in writing of the services available from
the PACE organization, including identification of all services that
are delivered through contracts, rather than furnished directly by the
PACE organization--
(A) Before enrollment;
(B) At enrollment; and
(C) When there is a change in services.
(2) To have the enrollment agreement, described in Sec. 460.154,
fully explained in a manner understood by the participant.
(3) To examine, or upon reasonable request, to be assisted to
examine the results of the most recent review of the PACE organization
conducted by HCFA or the State administering agency and any plan of
correction in effect.
In order for consumers, independently or in concert with their
designated representatives, to make rational decisions, they need
accurate, reliable information that will allow them to assess
differences in their health care options, including information
critical to their initial decision to enroll in PACE and whether to
remain in PACE. The CBRR provides for comprehensive information to be
provided to consumers in three basic categories: health plan
information; health professional information; and health care
facilities. Topics addressed include benefits, cost-sharing, dispute
resolution, consumer satisfaction and plan performance information,
network characteristics, care management information, corporate
organization, etc. The CBRR indicates that certain information should
be provided routinely with the remaining information available upon
request.
Information that is provided to potential enrollees is addressed in
more detail in the sections on marketing (Sec. 460.82) and enrollment
(Sec. 460.154). With regard to participant rights, we have linked the
right to information disclosure to the information that is included in
the enrollment agreement. The PACE organization must explain the
enrollment agreement in a manner understood by the participant to
ensure that all participants fully comprehend their rights and
responsibilities from the beginning of their relationship with the PACE
organization. Among the items in the enrollment agreement are: an
acknowledgment that the participant understands that the PACE
organization is the participant's sole service provider; a description
of PACE services available and how services are obtained from the PACE
organization; the procedures for obtaining emergency and urgently
needed out-of-network services; information on the grievance and
appeals processes; conditions for disenrollment; description of
participant premiums, if any, and procedures for payment of premiums.
We are requiring that the PACE organization inform participants
whenever changes occur in the services available from the PACE
organization.
The enrollment agreement also indicates that the PACE organization
has a program agreement with HCFA and the State administering agency
that is subject to renewal on a periodic basis. In order to provide
participants with information on the status of their organization's
agreement, PACE participants have the right to examine the results of
the most recent review of the PACE organization conducted by HCFA and
the State administering agency and any plan of correction in effect.
We are also requiring in Sec. 460.60(d), that changes in the
organizational structure of the PACE provider be approved in advance by
HCFA and the State administering agency. Once approved, information
about changes in organizational structure will be forwarded to the
consumer advisory committee for dissemination to participants as
appropriate. In this way, participants will be kept informed about the
organizational structure of the PACE provider and may determine if any
organizational changes made by the PACE organization affect their
continued enrollment in PACE.
Right #3--Choice of providers. Each participant has the
right to a choice of health care providers, within the PACE
organization's network, that is sufficient to ensure access to
appropriate high-quality health care. Specifically, each participant
has the right:
(1) To choose his or her primary care physician and specialists
from within the PACE network.
(2) To request that a qualified specialist for women's health
services provide routine or preventive women's health services.
(3) To disenroll from the program at any time.
The right to access specialists must be seen in the context of the
PACE model. Active involvement by participants in care planning in
conjunction with a multidisciplinary team approach to care management
and service delivery are fundamental aspects of the PACE model of care.
In fact, although sections 1894(f)(2)(B) and 1934(f)(2)(B) of the Act
provide for waiver of certain provisions of the protocol, use of the
multidisciplinary team approach may not be waived. Development of a
participant's plan of care begins with a comprehensive assessment.
Participant preferences for care are identified components of the
assessment. Once the plan of care is developed, the team is required to
continuously monitor the effectiveness of the plan in collaboration
with participants.
Moreover, the team is required to develop, review, and reevaluate
the plan of care in collaboration with the participant to ensure there
is agreement
[[Page 66255]]
with the plan of care and that participant concerns are addressed.
These provisions complement the participant rights to participate in
treatment decisions, to be fully informed of his or her functional
status by the multidisciplinary team, to participate in the development
and implementation of the plan of care, and to make health care
decisions, including the right to refuse treatment and to be informed
of the consequences of the decisions.
It is in this context that the determination with regard to the
need for specialty care is made by the multidisciplinary team and the
participant. If there is disagreement, then the participant has the
right to engage the dispute resolution process. Regardless, the
multidisciplinary team is expected to give ample consideration to a
participant's request to see a specialist and to objectively determine
whether such visits are necessary to meet the needs described in the
plan of care. To further emphasize access to a woman's health care
specialist within the context of the PACE model, we have identified
such a request as one of the participant preferences that must be
considered in developing the plan of care.
The CBRR asserts that consumers with complex or serious medical
conditions who require frequent specialty care should have direct
access to a qualified specialist of their choice within a plan's
network of providers. Authorizations, when required, should be for an
adequate number of direct access visits under an approved treatment
plan. We believe that central to the PACE model, with its reliance on
an all-inclusive plan of care that is derived by a multidisciplinary
team in collaboration with the participant, is the organization's
interest in ensuring that participants obtain the care they need,
including specialty care, in the easiest and most efficient manner
possible. A participant who needs a course of therapy with a specialist
will have that need reflected in his or her plan of care and would
receive that care for the duration and number of visits specified in
the plan. In light of the requirements elsewhere in this rule
concerning the development and management of the plan of care, we
believe it would be redundant to include an explicit requirement that
would mirror this CBRR provision, and have, therefore, not included
such a requirement.
With regard to having a choice of primary care physician and
specialists, the PACE organization is required to maintain sufficient
staff and contractors to meet the needs of its participants. Given the
participant census of PACE organizations, it is most likely that choice
will be limited. PACE organizations likely will start out with one of
each type of specialist and perhaps only one primary care physician.
Although CBRR includes the right to choose among physicians in the
provider's network, it was aimed at managed care organizations with
thousands of patients and numerous providers. Such is not the case with
the PACE model. Potential participants must weigh the limited network
of PACE organizations with the benefits of a comprehensive, all-
inclusive delivery system in choosing to enroll.
CBRR provides a right to transitional care for patients who are
undergoing an extensive course of treatment for a chronic or disabling
condition. As we discuss in greater detail in the section on the
enrollment process, potential participants must be advised that the
PACE organization is the participant's sole source provider and that
the organization guarantees access to services, but not to a specific
provider. As a result, PACE employees and specialists under contract
are expected to provide as much advance notice as possible of their
decision to terminate their relationship with the PACE organization in
order to provide sufficient time for the organization to secure a
replacement. In addition, the PACE organization and its contractors are
expected to provide as much advance notice as possible of a decision to
terminate a contract in order to provide for an orderly transition for
participants. We are requesting public input on the propriety of
establishing a contract requirement to ensure a minimum transition
period.
Right #4--Access to emergency services. Each participant
has the right to access emergency health care services when and where
the need arises without prior authorization by the PACE
multidisciplinary team.
In addition to establishing a participant right to emergency
services without prior authorization, we have described emergency care,
emergency medical condition, urgently needed services and post-
stabilization care services previously in the preamble in the section
regarding emergency care and in Sec. 460.100, consistent with the CBRR.
Right #5--Participation in treatment decisions. Each
participant has the right to fully participate in all decisions related
to his or her care. A participant who is unable to fully participate in
treatment decisions has the right to designate a representative.
Specifically, each participant has the right:
(1) To have all treatment options explained in a culturally
competent manner, and to make health care decisions, including the
right to refuse treatment, and be informed of the consequences of the
decisions.
(2) To have the PACE organization explain advance directives and to
establish them, if the participant so desires, in accordance with
Secs. 489.100 and 489.102 of this chapter.
(3) To be fully informed of his or her health and functional status
by the multidisciplinary team.
(4) To participate in the development and implementation of the
plan of care.
(5) To request a reassessment by the multidisciplinary team.
(6) To be given reasonable advance notice, in writing, of any
transfer to another treatment setting and the justification for the
transfer (i.e., due to medical reasons or for the participant's welfare
or that of other participants). The PACE organization must document the
justification in the participant's medical record.
As noted previously, active involvement by participants and their
designated representatives in care planning is fundamental to the PACE
model of care. As a result, we have retained the rights in the Protocol
related to participant involvement in the development and
implementation of the plan of care. We retained the participant's right
to be fully informed by the multidisciplinary team of his or her health
and functional status. In support of this right, the PACE participant
must have, upon written request, access to all records pertaining to
herself or himself. Moreover, the team must provide care information in
a manner that is responsive to the culturally diverse populations whom
they serve. The PACE organization may need to develop strategies for
enhancing cultural competence in its staff such as increased use of
interpreters, incorporating in-house training programs, recruiting
culturally diverse staff or contractors, or establishing relationships
with organizations that provide technical assistance regarding cultural
aspects of health care.
The Protocol states that a participant has the right to refuse
treatment and be informed of the consequences of such refusal. The
Protocol also states that PACE participants can establish advance
directives and make health care decisions. We restructured these two
requirements in order to place greater emphasis on the participant's
right to make health care decisions and to clarify that the right to
refuse treatment
[[Page 66256]]
is a type of health care decision. We have maintained the participant's
right to make ad
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