Sections 215, 371-376 of the Public Health Service Act (42 U.S.C. 216, 273-274d); sections 1102, 1106, 1138 and 1871 of the Social Security Act (42 U.S.C. 1302, 1306, 1320b-8 and 1395hh).
(a) The provisions of this part apply to the operation of the Organ Procurement and Transplantation Network (OPTN) and to the Scientific Registry.
(b) In accordance with section 1138 of the Social Security Act, hospitals in which organ transplants are performed and which participate in the programs under titles XVIII or XIX of the Social Security Act, and organ procurement organizations designated under section 1138(b) of the Social Security Act, are subject to the requirements of this part.
As used in this part—
(a)
(i) Approximately 50 percent transplant surgeons or transplant physicians;
(ii) At least 25 percent transplant candidates, transplant recipients, organ donors and family members. These members should represent the diversity of the population of transplant candidates, transplant recipients, organ donors and family members served by the OPTN including, to the extent practicable, the minority and gender diversity of this population. These members shall not be employees of, or have a similar relationship with OPOs, transplant centers, voluntary health organizations, transplant coordinators, histocompatibility experts, or other non-physician transplant professionals; however, the Board may waive this requirement for not more than 50 percent of these members; and
(iii) Representatives of OPOs, transplant hospitals, voluntary health associations, transplant coordinators, histocompatibility experts, non-physician transplant professionals, and the general public.
(2) The Board of Directors shall elect an Executive Committee from the membership of the Board. The Executive Committee shall include at least one general public member, one OPO representative, approximately 50 percent transplant surgeons and transplant physicians, and at least 25 percent transplant candidates, transplant recipients, organ donors, and family members.
(3) The Board of Directors shall appoint an Executive Director of the OPTN. The Executive Director may be reappointed upon the Board's determination that the responsibilities of this position have been accomplished successfully.
(4) The Board of Directors shall establish such other committees as are necessary to perform the duties of the OPTN. Committees established by the Board of Directors shall include:
(i) Representation by transplant coordinators, organ procurement organizations, and transplant hospitals, and at least one transplant candidate, transplant recipient, organ donor or family member; and
(ii) To the extent practicable, minority and gender representation reflecting the diversity of the population of transplant candidates, transplant recipients, organ donors and family members served by the OPTN.
(b)
(i) All organ procurement organizations;
(ii) Transplant hospitals participating in the Medicare or Medicaid programs; and
(iii) Other organizations, institutions, and individuals that have an interest in the fields of organ donation or transplantation.
(2) To apply for membership in the OPTN:
(i) An OPO shall provide to the OPTN the name and address of the OPO, and the latest year of designation under section 1138(b) of the Social Security Act;
(ii) A transplant hospital shall provide to the OPTN the name and address of the hospital, a list of its transplant programs by type of organ; and
(iii) Any other organization, institution, or individual eligible under paragraph (c)(1)(iii) of this section shall demonstrate to the OPTN an interest in the fields of organ donation or transplantation.
(3) The OPTN shall accept or reject as members entities or individuals described in paragraph (c)(1)(iii) of this section within 90 days.
(4) Applicants rejected for membership in the OPTN may appeal to the Secretary. Appeals shall be submitted in writing within 30 days of rejection of the application. The Secretary may:
(i) Deny the appeal; or
(ii) Direct the OPTN to take action consistent with the Secretary's response to the appeal.
(c)
(2) The requirements of this section do not apply to any parent, sponsoring, or affiliated organization of the OPTN, or to any activities of the contracting organization that are not integral to the operation of the OPTN. Such an organization is free to establish its own corporate procedures.
(3) No OPTN member is required to become a member of any organization that is a parent, sponsor, contractor, or affiliated organization of the OPTN, to comply with the by-laws of any such organization, or to assume any corporate duties or obligations of any such organization.
(d)
(a) The OPTN Board of Directors shall be responsible for developing, with the advice of the OPTN membership and other interested parties, policies within the mission of the OPTN as set forth in section 372 of the Act and the Secretary's contract for the operation of the OPTN, including:
(1) Policies for the equitable allocation of cadaveric organs in accordance with § 121.8;
(2) Policies, consistent with recommendations of the Centers for Disease Control and Prevention, for the testing of organ donors and follow-up of transplant recipients to prevent the spread of infectious diseases;
(3) Policies that reduce inequities resulting from socioeconomic status, including, but not limited to:
(i) Ensuring that payment of the registration fee is not a barrier to listing for patients who are unable to pay the fee;
(ii) Procedures for transplant hospitals to make reasonable efforts to obtain from all available sources, financial resources for patients unable to pay such that these patients have an opportunity to obtain a transplant and necessary follow-up care;
(iii) Recommendations to private and public payers and service providers on ways to improve coverage of organ transplantation and necessary follow-up care; and
(iv) Reform of allocation policies based on assessment of their cumulative effect on socioeconomic inequities;
(4) Policies regarding the training and experience of transplant surgeons and transplant physicians in designated transplant programs as required by § 121.9;
(5) Policies for nominating officers and members of the Board of Directors; and
(6) Policies on such other matters as the Secretary directs.
(b) The Board of Directors shall:
(1) Provide opportunity for the OPTN membership and other interested parties to comment on proposed policies and shall take into account the comments received in developing and adopting policies for implementation by the OPTN; and
(2) Provide to the Secretary, at least 60 days prior to their proposed implementation, proposed policies it recommends to be enforceable under § 121.10 (including allocation policies). These policies will not be enforceable until approved by the Secretary. The Board of Directors shall also provide to the Secretary, at least 60 days prior to their proposed implementation, proposed policies on such other matters as the Secretary directs. The Secretary will refer significant proposed policies to the Advisory Committee on Organ Transplantation established under § 121.12, and publish them in the
(c) The OPTN Board of Directors shall provide the membership and the Secretary with copies of its policies as they are adopted, and make them available to the public upon request. The Secretary will publish lists of OPTN policies in the
(d) Any interested individual or entity may submit to the Secretary in writing critical comments related to the manner in which the OPTN is carrying out its duties or Secretarial policies regarding the OPTN. Any such comments shall include a statement of the basis for the comments. The Secretary will seek, as appropriate, the comments of the OPTN on the issues raised in the comments related to OPTN policies or practices. Policies or practices that are the subject of critical comments remain in effect during the Secretary's review, unless the Secretary directs otherwise based on possible risk to the health of patients or to public safety. The Secretary will consider the comments in light of the National Organ Transplant Act and the regulations under this part and may consult with the Advisory Committee on Organ Transplantation established under § 121.12. After this review, the Secretary may:
(1) Reject the comments;
(2) Direct the OPTN to revise the policies or practices consistent with the Secretary's response to the comments; or
(3) Take such other action as the Secretary determines appropriate.
(e) The OPTN shall implement policies and shall:
(1) Provide information to OPTN members about these policies and the rationale for them; and
(2) Update policies developed in accordance with this section to accommodate scientific and technological advances.
(a) A transplant hospital which is an OPTN member may list individuals, consistent with the OPTN's criteria under § 121.8(b)(1), only for a designated transplant program.
(b) Transplant hospitals shall assure that individuals are placed on the waiting list as soon as they are determined to be candidates for transplantation. The OPTN shall advise transplant hospitals of the information needed for such listing.
(c) An OPTN member shall pay a registration fee to the OPTN for each transplant candidate it places on the waiting list. The amount of such fee shall be calculated to cover (together with contract funds awarded by the Secretary) the reasonable costs of operating the OPTN and shall be determined by the OPTN with the approval of the Secretary. No less often than annually, and whether or not a change is proposed, the OPTN shall submit to the Secretary a statement of its proposed registration fee, together with such supporting information as the Secretary finds necessary to determine the reasonableness or adequacy of the fee schedule and projected revenues. This submission is due at least three months before the beginning of the OPTN's fiscal year. The Secretary will
The suitability of organs donated for transplantation shall be determined as follows:
(a)
(b)
(c)
(a)
(2) The rank order of potential recipients shall be determined for each cadaveric organ using the organ specific allocation criteria established in accordance with § 121.8.
(3) When a donor or donor organ does not meet a transplant program's donor acceptance criteria, as established under § 121.6(c), transplant candidates of that program shall not be ranked among potential recipients of that organ and shall not appear on a roster of potential recipients of that organ.
(b)
(2) Organs may be offered only to potential recipients listed with transplant programs having designated transplant programs of the same type as the organ procured.
(3) An organ offer is made when all information necessary to determine whether to transplant the organ into the potential recipient has been given to the transplant hospital.
(4) A transplant program shall either accept or refuse the offered organ for the designated potential recipient within such time as the OPTN may prescribe. A transplant program shall document and provide to the OPO and to the OPTN the reasons for refusal and shall maintain this document for one year.
(c)
(2)
(3)
(d)
(e)
(a)
(1) Shall be based on sound medical judgment;
(2) Shall seek to achieve the best use of donated organs;
(3) Shall preserve the ability of a transplant program to decline an offer of an organ or not to use the organ for the potential recipient in accordance with § 121.7(b)(4)(d) and (e);
(4) Shall be specific for each organ type or combination of organ types to be transplanted into a transplant candidate;
(5) Shall be designed to avoid wasting organs, to avoid futile transplants, to promote patient access to transplantation, and to promote the efficient management of organ placement;
(6) Shall be reviewed periodically and revised as appropriate;
(7) Shall include appropriate procedures to promote and review compliance including, to the extent appropriate, prospective and retrospective reviews of each transplant program's application of the policies to patients listed or proposed to be listed at the program; and
(8) Shall not be based on the candidate's place of residence or place of listing, except to the extent required by paragraphs (a)(1)-(5) of this section.
(b)
(1) Standardizing the criteria for determining suitable transplant candidates through the use of minimum criteria (expressed, to the extent possible, through objective and measurable medical criteria) for adding individuals to, and removing candidates from, organ transplant waiting lists;
(2) Setting priority rankings expressed, to the extent possible, through objective and measurable medical criteria, for patients or categories of patients who are medically suitable candidates for transplantation to receive transplants. These rankings shall be ordered from most to least medically urgent (taking into account, in accordance with paragraph (a) of this section, and in particular in accordance with sound medical judgment, that life sustaining technology allows alternative approaches to setting priority ranking for patients). There shall be a sufficient number of categories (if categories are used) to avoid grouping together patients with substantially different medical urgency;
(3) Distributing organs over as broad a geographic area as feasible under paragraphs (a)(1)-(5) of this section, and in order of decreasing medical urgency; and
(4) Applying appropriate performance indicators to assess transplant program performance under paragraphs (c)(2)(i) and (c)(2)(ii) of this section and reducing the inter-transplant program variance to as small as can reasonably be achieved in any performance indicator under paragraph (c)(2)(iii) of this section as the Board determines appropriate, and under paragraph (c)(2)(iv) of this section. If the performance indicator “waiting time in status” is used for allocation purposes, the OPTN shall seek to reduce the inter-transplant program variance in this indicator, as well as in other selected performance indicators, to as small as can reasonably be achieved, unless to do so would result in transplanting less medically urgent patients or less medically urgent patients within a category of patients.
(c)
(i) Achieving the performance goals set out in paragraph (b) of this section; and
(ii) Giving patients, their families, their physicians, and others timely and
(2) Performance indicators shall include:
(i) Baseline data on how closely the results of current allocation policies approach the performance goals established under paragraph (b) of this section;
(ii) With respect to any proposed change, the amount of projected improvement in approaching the performance goals established under paragraph (b) of this section;
(iii) Such other indicators as the Board may propose and the Secretary approves; and
(iv) Such other indicators as the Secretary may require.
(3) For each organ-specific allocation policy, the OPTN shall provide to the Secretary data to assist the Secretary in assessing organ procurement and allocation, access to transplantation, the effect of allocation policies on programs performing different volumes of transplants, and the performance of OPOs and the OPTN contractor. Such data shall be required on performance by organ and status category, including program-specific data, OPO-specific data, data by program size, and data aggregated by organ procurement area, OPTN region, the Nation as a whole, and such other geographic areas as the Secretary may designate. Such data shall include the following measures of inter-transplant program variation: risk-adjusted total life-years pre-and post-transplant, risk-adjusted patient and graft survival rates following transplantation, risk-adjusted waiting time and risk-adjusted transplantation rates, as well as data regarding patients whose status or medical urgency was misclassified and patients who were inappropriately kept off a waiting list or retained on a waiting list. Such data shall cover such intervals of time, and be presented using confidence intervals or other measures of variance, as may be required to avoid spurious results or erroneous interpretation due to small numbers of patients covered.
(d)
(2)
(e)
(2) No later than March 16, 2000 the OPTN shall transmit revised policies and supporting documentation for liver allocation to meet the requirements of paragraphs (a) and (b) of this section to the Secretary for review in accordance with § 121.4. The OPTN may transmit these materials without seeking further public comment under § 121.4(b).
(f)
(g)
(h)
(a) To receive organs for transplantation, a transplant program in a hospital that is a member of the OPTN shall abide by these rules and shall:
(1) Be a transplant program approved by the Secretary for reimbursement under Medicare; or
(2) Be an organ transplant program which has adequate resources to provide transplant services to its patients and agrees promptly to notify the OPTN and patients awaiting transplants if it becomes inactive and which:
(i) Has letters of agreement or contracts with an OPO;
(ii) Has on site a transplant surgeon qualified in accordance with policies developed under § 121.4;
(iii) Has on site a transplant physician qualified in accordance with policies developed under § 121.4;
(iv) Has available operating and recovery room resources, intensive care resources and surgical beds and transplant program personnel;
(v) Shows evidence of collaborative involvement with experts in the fields of radiology, infectious disease, pathology, immunology, anesthesiology, physical therapy and rehabilitation medicine, histocompatibility, and immunogenetics and, as appropriate, hepatology, pediatrics, nephrology with dialysis capability, and pulmonary medicine with respiratory therapy support;
(vi) Has immediate access to microbiology, clinical chemistry, histocompatibility testing, radiology, and blood banking services, as well as the capacity to monitor treatment with immunosuppressive drugs; and
(vii) Makes available psychiatric and social support services for transplant candidates, transplant recipients, and their families; or
(3) Be a transplant program in a Department of Veterans Affairs, Department of Defense, or other Federal hospital.
(b) To apply to be a designated transplant program, transplant programs shall provide to the OPTN such documents as the OPTN may require which show that they meet the requirements of § 121.9(a) (1), (2), or (3).
(c) The OPTN shall, within 90 days, accept or reject applications to be a designated transplant program.
(d) Applicants rejected for designation may appeal to the Secretary. Appeals shall be submitted in writing within 30 days of rejection of the application. The Secretary may:
(1) Deny the appeal; or
(2) Direct the OPTN to take action consistent with the Secretary's response to the appeal.
(a)
(b)
(i) Reviewing applications submitted under § 121.3(c) for membership in the OPTN;
(ii) Reviewing applications submitted under § 121.9(b) to be a designated transplant program; and
(iii) Conducting ongoing and periodic reviews and evaluations of each member OPO and transplant hospital for compliance with these rules and OPTN policies.
(2) Upon the approval of the Secretary, the OPTN shall furnish review plans and procedures, including survey instruments and a description of data systems, to each member OPO and transplant hospital. The OPTN shall furnish any revisions of these documents to member OPOs and hospitals, after approval by the Secretary, prior to their implementation.
(3) At the request of the Secretary, the OPTN shall conduct special reviews of OPOs and transplant programs, where the Secretary has reason to believe that such entities may not be in compliance with these rules or OPTN policies or may be acting in a manner which poses a risk to the health of patients or to public safety. The OPTN shall conduct these reviews in accordance with such schedules as the Secretary specifies and shall make periodic reports to the Secretary of progress on such reviews and on other reviews conducted under the requirements of this paragraph.
(4) The OPTN shall notify the Secretary in a manner prescribed by the Secretary within 3 days of all committee and Board of Directors meetings in which transplant hospital and OPO compliance with these regulations or OPTN policies is considered.
(c)
(2)
(i) Request further information from the Board of Directors or the alleged violator, or both;
(ii) Decline to accept the recommendation;
(iii) Accept the recommendation, and notify the alleged violator of the Secretary's decision; or
(iv) Take such other action as the Secretary deems necessary.
(a)
(1) The OPTN and the Scientific Registry, as appropriate, shall:
(i) Maintain and operate an automated system for managing information about transplant candidates, transplant recipients, and organ donors, including a computerized list of individuals waiting for transplants;
(ii) Maintain records of all transplant candidates, all organ donors and all transplant recipients;
(iii) Operate, maintain, receive, publish, and transmit such records and information electronically, to the extent feasible, except when hard copy is requested; and
(iv) In making information available, provide manuals, forms, flow charts, operating instructions, or other explanatory materials as necessary to understand, interpret, and use the information accurately and efficiently.
(2)
(ii)
(b)
(i) In addition to special reports which the Secretary may require, submit to the Secretary a report not less than once every fiscal year on a schedule prescribed by the Secretary. The report shall include the following information in a form prescribed by the Secretary:
(A) Information that the Secretary prescribes as necessary to assess the effectiveness of the Nation's organ donation, procurement and transplantation system;
(B) Information that the Secretary deems necessary for the report to Congress required by Section 376 of the Act; and,
(C) Any other information that the Secretary prescribes.
(ii) Provide to the Scientific Registry data on transplant candidates and recipients, and other information that the Secretary deems appropriate. The information shall be provided in the form and on the schedule prescribed by the Secretary;
(iii) Provide to the Secretary any data that the Secretary requests;
(iv) Make available to the public timely and accurate program-specific information on the performance of transplant programs. This shall include free dissemination over the Internet, and shall be presented, explained, and organized as necessary to understand, interpret, and use the information accurately and efficiently. These data shall be updated no less frequently than every six months (or such longer period as the Secretary determines would provide more useful information to patients, their families, and their physicians), and shall include risk-adjusted probabilities of receiving a transplant or dying while awaiting a transplant, risk-adjusted graft and patient survival following the transplant, and risk-adjusted overall survival following listing for such intervals as the Secretary shall prescribe. These data shall include confidence intervals or other measures that provide information on the extent to which chance may influence transplant program-specific results. Such data shall also include such other cost or performance information as the Secretary may specify, including but not limited to transplant program-specific information on waiting time within medical status, organ wastage, and refusal of organ offers. These data shall also be presented no more than six months later than the period to which they apply;
(v) Respond to reasonable requests from the public for data needed for bona fide research or analysis purposes, to the extent that the OPTN's or Scientific Registry's resources permit, or as directed by the Secretary. The OPTN or the Scientific Registry may impose reasonable charges for the separable costs of responding to such requests. Patient-identified data may be made available to bona fide researchers upon a showing that the research design requires such data for matching or other purposes, and that appropriate confidentiality protections, including destruction of patient identifiers upon completion of matching, will be followed. All requests shall be processed expeditiously, with data normally made available within 30 days from the date of request;
(vi) Respond to reasonable requests from the public for data needed to assess the performance of the OPTN or Scientific Registry, to assess individual transplant programs, or for other purposes. The OPTN or Scientific Registry may impose charges for the separable costs of responding to such
(vii) Provide data to an OPTN member, without charge, that has been assembled, stored, or transformed from data originally supplied by that member.
(2) An organ procurement organization or transplant hospital shall, as specified from time to time by the Secretary, submit to the OPTN, to the Scientific Registry, as appropriate, and to the Secretary information regarding transplantation candidates, transplant recipients, donors of organs, transplant program costs and performance, and other information that the Secretary deems appropriate. Such information shall be in the form required and shall be submitted in accordance with the schedule prescribed. No restrictions on subsequent redisclosure may be imposed by any organ procurement organization or transplant hospital.
(c)
The Secretary will establish, consistent with the Federal Advisory Committee Act, the Advisory Committee on Organ Transplantation. The Secretary may seek the comments of the Advisory Committee on proposed OPTN policies and such other matters as the Secretary determines.
Secs. 215, 1602, 1625, Public Health Service Act (42 U.S.C. 216, 300o-1, 300r), unless otherwise noted.
The regulations of this subpart are applicable to grants under section 1625 of the Public Health Service Act for construction and modernization projects designed to:
(a) Eliminate or prevent imminent safety hazards as defined by Federal, State or local fire, building, or life safety codes or regulations, or
(b) Avoid noncompliance with State or voluntary licensure or accreditation standards.
As used in this subpart:
(a)
(b)
(c)
(d)
(e)
(1) Which is a hospital (other than a hospital primarily for the care and treatment of mentally ill or tuberculosis patients) or is operated in connection with a hospital, or
(2) In which such care and medical services are prescribed by, or are performed under the general direction of, persons licensed to practice medicine or surgery in the State.
(f)
(g)
(h)
(i)
(j)
(k)
(1) Which is operated in connection with a hospital, or
(2) In which patient care of a specialized nature (such as in an eye clinic, dental clinic, or ambulatory surgical center) is provided under the professional supervision of persons licensed to practice medicine or surgery in the State, or in the case of dental diagnosis or treatment, under the professional supervision of persons licensed to practice dentistry in the State, or
(3) Which offers to patients not requiring hospitalization the services of licensed physicians in various medical specialties, and which provides to its patients a reasonably full range of diagnostic and treatment services.
(l)
(m)
(n)
(o)
(p)
(q)
(r)
(s)
(a)
(b)
(1) Eliminate or prevent safety hazards which under Federal, State, and/or local fire, building or life safety codes or regulations, will, in the judgment of the Secretary result in one or more of the following:
(i) Loss of licensure for the facility.
(ii) Closing of all or a substantial part of the facility,
(iii) Loss of eligibility for reimbursement under title XVIII or title XIX of the Social Security Act; or
(2) Avoid noncompliance with State licensure or voluntary accreditation standards where noncompliance will, in the judgment of the Secretary, result in one or both of the following:
(i) Loss of licensure for the facility,
(ii) Loss of accreditation resulting in loss of eligibility for reimbursement under title XVIII or title XIX of the Social Security Act.
An application for a grant under this subpart must be submitted directly to the Secretary at such time and in such form and manner as the Secretary may prescribe. The application must be executed by an individual authorized to act for the applicant and assume on behalf of the applicant the obligations imposed by the Act, this subpart, and the terms and conditions of the grant. The application must contain the following:
(a) A description of the site of the project.
(b) A full description, with all appropriate documentation, of:
(1) The imminent safety hazards, licensure and/or accreditation problems of the facility;
(2) The type and amount of assistance sought under this subpart;
(3) The construction of modernization project for which funds are sought, describing how it will remedy the problems described pursuant to paragraph (b)(1) of this section, with a complete schedule for the proposed construction or modernization; and
(4) How failure to remedy the problems described pursuant to paragraph (b) (1) of this section will affect the population served by the facility.
(c) In the case of a modernization project for continuation of existing health services, a finding by the State Agency of the continued need for such services. In the case of a construction or modernization project for new health services, a finding by the State Agency of the need for such services. The finding of need shall be based on the following criteria:
(1) In a State which has a program approved by the Secretary under section 1523(a)(4)(B) of the Act, a State certificate of need program, or a program under section 1122 of the Social Security Act, the State Agency shall use the criteria used in conducting reviews under such program. In a State which has more than one such program, the State Agency shall use the criteria of one of the programs and notify the Secretary of the program criteria used.
(2) In a State which does not have a program approved by the Secretary under section 1523(a)(4)(B) of the Act, a State certificate of need program or a program under section 1122 of the Social Security Act, the State Agency shall base its finding of need on the following criteria:
(i) Whether the proposed project is needed or projected as necessary to meet the needs in the community in
(ii) Whether the proposed project can be adquately staffed and operated when completed;
(iii) Whether the proposed capital expenditure is economically feasible and can be accommodated in the patient charge structure of the health facility without unreasonable increases; and
(iv) Whether the project will foster cost containment or improved quality of care through improved effciency and productivity, including promotion of cost-effective factors such as ambulatory care, preventive health care services, home health care, and design and construction economies, or through increased competition between different health services delivery systems.
(d) [Reserved]
(e) An assurance that adequate financial support will be available for completion of the project, supported by a detailed project budget satisfactory to the Secretary which includes all existing and anticipated sources of funds for the project.
(f) An assurance that adequate financial support will be available for maintenance and operation of the project when completed, supported by budgets and detailed expenditure and revenue information satisfactory to the Secretary for both the facility and the applicant for the past three fiscal years and budget and projections of expenditures and revenue for the future three fiscal years. Where a certificate of need or a favorable finding under section 1122 of the Social Security Act is required in order for the project to operate and/or receive reimbursement from governmental programs for health services provided, assurance from the applicant satisfactory to the the Secretary that the applicant will submit, consistent with the provisions of § 124.5(d), any such required certificates of need and/or section 1122 finding.
(g) An assurance that the applicant would not be able to complete the project without the grant applied for, supported by a description of all efforts to obtain funds needed to complete the project and the results of such efforts.
(h) An assurance that all times after the application is approved there will be made available in the facility or portion thereof to be constructed or modernized, a reasonable volume of services to persons unable to pay therefor. The applicant shall comply with the standards and procedures of 42 CFR 53.111, except as the Secretary may prescribe pursuant to section 1602(6) of the Act. The functions of the State Agency designated under section 604 of the Act under 42 CFR 53.111 will be performed by the Secretary, except to the extent they are otherwise assigned.
(i) An assurance that at all times after the application is approved the facility or portion thereof to be constructed or modernized will be made available to all persons residing or employed in the area served by the facility. The applicant shall comply with the standards and procedures of 42 CFR 53.113, except as the Secretary may prescribe pursuant to section 1602(6) of the Act. The functions of the State Agency designated under section 604 of the Act under 42 CFR 53.113 will be performed by the Secretary, except to the extent they are otherwise assigned.
(j) An assurance that title to the project site is or will be vested in one or more of the entities filing the application or in a public or other nonprofit entity which is to operate the facility on completion of the project, with such documentation as the Secretary may require.
(k) In the case of an application for construction or modernization of an outpatient medical facility, an assurance, supported by a written transfer agreement (or written documentation that such agreement will be obtained) with identified hospitals, that the services of a general hospital will be available to patients at such facility who are in need of hospital care.
(l) Evidence that: (1) The appropriate health systems agency has been given the opportunity to review the application in accordance with section 1513(e) of the Act and the requirements of the appendix to this subpart, with the result of any such review.
(2) The application has been reviewed in accordance with the applicable requirements of OMB Circular A-95.
(m) An analysis satisfactory to the Secretary and such other information and materials as the Secretary may require concerning the environmental impact of the proposed construction or modernization project.
(n) An assessment satisfactory to the Secretary of the project site in light of the considerations set forth in Executive Order 11296 (31 FR 10663, August 10, 1966) concerning the evaluation of flood hazards in locating Federally supported facilities.
(o) In the case of a project which involves the displacement of persons or businesses, an assurance that the applicant will comply with the applicable provisions of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. 4601
(p)(1) An assurance that all laborers and mechanics employed by contractors or subcontractors in the performance of work on a project will be paid wages at rates not less than those prevailing on similar construction in the locality as determined by the Secretary of Labor in accordance with the Act of March 3, 1931 (40 U.S.C. 276a-276a-5, known as the Davis-Bacon Act); and
(2) An assurance that the following conditions and provisions will be included in all construction contracts:
(i) The provisions of “DHHS Requirements for Federally Assisted Construction Contracts Regarding Labor Standards and Equal Employment Opportunity,” Form DHHS 514 (rev. July 1976) (issued by the Office of Grants and Procurement Management, U.S. Department of Health and Human Services) pertaining to the Davis-Bacon Act, the Contract Work Hours Standards Act, and the Copeland Act (Anti-Kickback) regulations except in the case of contracts in the amount of $2,000 or less; and pertaining to Executive Order 11246, September 24, 1965 (30 FR 12319), relating to nondiscrimination in construction contract employment except in the case of contracts in the amount of $10,000 or less, and
(ii) Representatives of the Secretary will have access at all reasonable times to work wherever it is in preparation or progress, and the contractor shall provide proper facilities for such access and inspection.
(q) Such other information as the Secretary may require.
(a)(1) Within the limits of funds available for such purpose, the Secretary may award grants under this subpart for project costs to applicants with approvable applications therefor which will, in his judgment, best promote the purposes of section 1625 of the Act, taking into consideration:
(i) The severity and seriousness of the safety hazard, licensure or accreditation problem or problems.
(ii) The relative need of the population to be served for the services to be provided, including the availability of alternatives for meeting the need.
(iii) The financial need of the applicant.
(iv) The extent to which the facility will serve persons below the poverty level, as determined by the Secretary of Commerce.
(v) The extent to which the project will foster cost containment or improve the quality of care through enhanced efficiency and productivity.
(2) Priority for funding shall be based on the extent to which services will be made available relative to the cost of the project.
(b) The amount of any grant under this subpart may not exceed 75 percent of the cost of the project for which the grant is made unless the project is located in an area determined by the Secretary to be an urban or rural poverty area, in which case the grant may, as determined by the Secretary, cover up to 100 percent of such costs.
(c) If an applicant has not entered into a legally enforceable fixed price contract for the project for which funds are awarded under this subpart within 180 days of the date of the grant award, the grant award will automatically become null and void.
(d) Where a grant has been awarded to an applicant under this subpart on
Grant payments shall be made to the applicant in accordance with the requirements of subpart K of 45 CFR part 74.
Any funds granted pursuant to this subpart, as well as funds assured by the applicant for the project, shall be expended solely for carrying out the approved project in accordance with section 1625 of the Act, the regulations of this subpart, the terms and conditions of the grant award, and the applicable cost principles prescribed by subpart Q of 45 CFR part 74.
(a)
(i) The amount of all payments received from the Secretary under this subpart,
(ii) Amounts and sources of all funds, in addition to funds received under this subpart, applied to the construction or modernization project funded under this subpart,
(iii) Disposition of all funds for the construction or modernization project funded under this subpart,
(iv) Total cost of the project approved under this subpart, and
(2) Upon request, applicants shall make such records, books, papers, or other documents available to the Secretary and the Comptroller General of the United States or any of their duly authorized representatives which, in their opinion, may be related or pertinent to the grant under this subpart.
(b)
(a) Attention is called to the requirements of title VI of the Civil Rights Act of 1964 (78 Stat. 252, 42 U.S.C. 2000d
(b) Attention is called to the requirements of section 504 of the Rehabilitation Act of 1973, as amended, which provides that no otherwise qualified handicapped individual in the United States shall, solely by reason of the handicap, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance. A regulation implementing section 504 has been issued (45 CFR part 84 (42 FR 22676, May 4, 1977)).
(c) All portions and services of the entire facility for the construction or modernization of which, or in connection with which aid under the Act is sought must be made available without discrimination on account of creed and the applicant may not discriminate against any qualified person on account of creed with respect to the privilege of professional practice in the facility.
(d) Attention is also called to the requirements of title IX of the Education amendments of 1972 and in particular to section 901 of such Act (20 U.S.C. 1681) which provides that no person in the United States shall, on the basis of sex be excluded from participation in,
(e) Each construction contract is subject to the condition that the applicant shall comply with the requirements of section 321 of the Comprehensive Alcohol Abuse and Alcoholism Prevention, Treatment, and Rehabilitation Act of 1970, as amended, which provides that alcohol abusers and alcoholics who are suffering from medical conditions shall not be discriminated against in admission or treatment, solely because of their alcohol abuse or alcoholism by any private or public general hospital that receives support in any form from any federally funded program.
(f) Each construction contract is subject to the condition that the applicant shall comply with the requirements of section 407 of the Drug Abuse Office and Treatment Act of 1972, as amended, which provides that drug abusers who are suffering from medical conditions shall not be discriminated against because of their drug abuse or drug dependence, by any private or public general hospital that receives support in any form from any federally funded program.
The Secretary may impose additional conditions prior to or at the time of any grant award when in the Secretary's judgment such conditions are necessary to assure or protect advancement of the project in accordance with the purposes of the Act and the regulations of this subpart or the conservation of grant funds.
The provisions of 45 CFR part 74, establishing uniform administrative requirements and cost principles, shall apply to all grants under this subpart to State and local governments as those terms are defined in subpart A of that part 74, except to the extent inconsistent with this subpart. The relevant provisions of the following subparts of part 74 shall also apply to grants to all other grantee organizations under this subpart.
42 U.S.C. 216; 42 U.S.C. 300s(3).
(a) The provisions of this subpart apply to any recipient of Federal assistance under title VI or XVI of the Public Health Service Act that gave an assurance that it would make available, in the facility or portion of the facility constructed, modernized or converted with that assistance, a reasonable volume of services to persons unable to pay for the services.
(b) The provisions of this subpart apply to facilities for the following periods:
(1)
(i) Twenty years after the completion of construction, in the case of a facility for which the Secretary provided grant assistance under section 606 of the Act; or
(ii) The period from completion of construction until the amount of a direct loan under sections 610 and 623 of the Act, or the amount of a loan with respect to which the Secretary provided a guarantee and interest subsidy under section 623 of the Act, is repaid, in the case of a facility for which such a loan was made.
(iii) “Completion of construction” means:
(A) The date on which the Secretary determines the facility was opened for service;
(B) If the opening date is not available, it means the date on which the Secretary approved the final part of the facility's application for assistance under title VI of the Act;
(C) If the date of final approval is not available, it means whatever date the Secretary determines most reasonably approximates the date of final approval.
(2)
As used in this subpart—
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(1) For facilities other than those certified under § 124.513, § 124.514,
(2) For facilities certified under § 124.513, § 124.514, § 124.515, or § 124.516, services as defined in paragraph (m)(1) of this section and services that are made available to persons unable to pay for them under programs described by the documentation provided under § 124.513(c)(2), § 124.514(c)(2), or § 124.516(c)(2), as applicable, or pursuant to the terms of the applicable grant or agreement as provided in § 124.515. Except as provided in § 124.516, excluded are services reimbursed by Medicare, Medicaid, or other third party programs, including services for which reimbursement was provided as payment in full, and services provided more than 96 hours following notification to the facility by a peer review organization that it disapproved the services under section 1155(a)(1) or section 1154(a)(1) of the Social Security Act.
(a)
(1) Three percent of its operating costs for the most recent fiscal year for which an audited financial statement is available;
(2) Ten percent of all Federal assistance provided to or on behalf of the facility, adjusted by a percentage equal to the percentage change in the CPI between the year in which the facility received assistance or 1979, whichever is later, and the most recent year for which a published index is available.
(b)
(1)
(i)
(ii)
(2)
(B) A facility assisted under title XVI of the Act is not required to make up a justifiable deficit.
(ii)
(B) A facility which claimed financial inability under § 124.509(a)(2)(iii) and is found by the Secretary, pursuant to § 124.511(c), to have been financially able to provide uncompensated services in the year in which the deficit was incurred shall begin to make up the deficit beginning in the fiscal year following the Secretary's finding.
(C) A facility required to make up a noncompliance deficit but which is determined by the Secretary, pursuant to § 124.511(c), to be financially unable to do so in the year following the Secretary's finding of noncompliance shall
(3)
(ii) The amount of a justifiable deficit must be adjusted by a percentage equal to the percentage change in the CPI between the CPI available in the fiscal year in which the deficit was incurred and the CPI available in the fiscal year in which it was made up.
(iii) An amount equal to the result of dividing the amount of any noncompliance deficit for a fiscal year by the number of years of obligation remaining and adjusting it by a percentage equal to the percentage change in the CPI between the CPI available in the fiscal year in which the deficit was incurred and the CPI available in the fiscal year in which it was made up shall be added to a facility's annual compliance level for each fiscal year following the fiscal year of the finding of noncompliance.
(4)
(c)
(2)
(ii) The amount of any excess compliance applied to reduce a facility's annual compliance level must be adjusted by a percentage equal to the percentage change in the CPI between the CPI available in the fiscal year in which the facility provided the excess, and the CPI available in the fiscal year in which the facility applies the excess to reduce its annual compliance level or satisfy its remaining obligation.
(3) Except as provided in subparagraph (1) of this paragraph, a facility assisted under title VI may in any fiscal year apply the amount of excess credited under this paragraph to satisfy the remainder of its obligation to provide uncompensated services. A facility's remaining obligation is determined as follows:
(i) Where the annual compliance level in such fiscal year is established under paragraph (a)(2) of this section, the remaining obligation is:
(A) For grant assistance, 10 percent of each grant under obligation, multiplied by the number of years remaining in its period of obligation, adjusted as provided for in paragraph (a)(2) of this section, plus any deficits required to be made up and less any unused excesses accrued in prior years; and
(B) For loan assistance, the facility's annual compliance level multiplied by the number of years remaining in the scheduled life of the loan, plus the sum of 10 percent of each yearly cumulative total of additional interest subsidy or other payments (which the Secretary will have made in connection with the guaranteed loan or a direct loan which has been sold) in each subsequent year remaining in the scheduled life of the loan, plus any deficits required to be
(ii) Where the annual compliance level in such fiscal year is established under paragraph (a)(1) of this section, the remaining obligation is the average of the facility's annual compliance levels in the previous three years, multiplied by the number of years remaining in its period of obligation, plus any deficits required to be made up under this section, and less any unused excesses accrued in prior years.
(a)
(1) The plan of allocation the facility proposes to adopt;
(2) The amount of uncompensated services the facility intends to make available in the fiscal year or a statement that the facility will provide uncompensated services to all persons unable to pay who request uncompensated services;
(3) An explanation, if the amount of uncompensated services the facility intends to make available in a fiscal year is less than the annual compliance level. If a facility has satisfied its remaining uncompensated services obligation since the last published notice under this paragraph, or will satisfy the remaining obligation during the fiscal year, the explanation must include this information; and
(4) A statement inviting interested parties to comment on the allocation plan.
(b)
(2) If in the service area of the facility the “usual language of households” of ten percent or more of the population according to the most recent figures published by the Bureau of the Census is other than English or Spanish, the facility shall translate the notice into that language and post the translated notice on signs substantially similar in size and legibility to and posted with those supplied under paragraph (b)(1) of this section.
(3) The facility shall make reasonable efforts to communicate the contents of the posted notice to persons who it has reason to believe cannot read the notice.
(c)
(i) State that the facility is required by law to provide a reasonable amount of care without or below charge to people who cannot afford care;
(ii) Set forth the criteria the facility uses for determining eligibility for uncompensated services (in accordance with the financial eligibility criteria and the allocation plan);
(iii) State the location in the facility where anyone seeking uncompensated services may request them; and
(iv) State that the facility will make a written determination of whether the person will receive uncompensated services, and the date by or period within which the determination will be made.
(2) The facility shall provide the individual written notice before providing services, except where the emergency nature of the services provided makes prior notice impractical. If this exception applies, the facility shall provide the individual written notice to the next of kin or to the patient as soon as practical, but not later than when first presenting a bill for services.
(3) The facility shall make reasonable efforts to communicate the contents of the individual written notice to persons who it has reason to believe cannot read the notice.
(a) A person unable to pay for health services is a person who—
(1) Is not covered, or receives services not covered, under a third-party insurer or governmental program, except where the person is not covered because the facility fails to participate in a program in which it is required to participate by § 124.603(c);
(2) Falls into one of the following categories:
(i)
(ii)
(iii)
(3) Requests services within the facility's allocation plan in effect at the time of the request.
(b) For purposes of determining eligibility for uncompensated services, revisions of the poverty line are effective 60 days from the date of their publication in the
(c) A person is eligible for uncompensated services if the person's individual or family annual income, as applicable, is at or below the level established under paragraph (a)(2) of this section, when calculated by either of the following methods:
(1) Multiplying by four the person's or family's income, as applicable, for the three months preceding the request for uncompensated services;
(2) Using the person's or family's income, as applicable, for the twelve months preceding the request for uncompensated services.
(a)(1) A facility shall provide its uncompensated services in accordance with a plan that sets out the method by which the facility will distribute its uncompensated services among persons unable to pay. The plan must:
(i) State the type of services that will be made available;
(ii) Specify the method, if any, for distributing those services in different periods of the year;
(iii) State whether Category B or, in the case of nursing homes only, Category C persons will be provided uncompensated services, and if so, whether the services will be available without charge or at a reduced charge;
(iv) If services will be made available to Category B persons at a reduced charge, specify the method used for reducing charges, and provide that the method is applicable to all persons in Category B;
(v) With respect to nursing homes only, if services will be made available to Category C persons at a reduced charge, specify the method used for reducing charges, provided that such method may not result in greater reductions than those afforded to Category B persons, and provide that this method is applicable to all persons in Category C; and
(vi) Provide that the facility provides uncompensated services to all persons eligible under the plan who request uncompensated services.
(2) A facility must adopt an allocation plan that meets the requirements of paragraph (a) by publishing the plan in a newspaper of general circulation in its area. The plan may take effect no earlier than 60 days following the date of publication.
(b)(1) If in any fiscal year a facility fails to adopt and publish a plan in accordance with paragraph (a) of this section, it shall provide uncompensated services in accordance with the last plan it published in a newspaper of general circulation in its area.
(2) If no plan was previously published in accordance with paragraph (a)(2) of this section, the facility must provide uncompensated services without charge to all applicants in Category A and Category B, and, with respect to nursing homes, Category C, who request service in the facility. This requirement applies until the facility ceases to provide uncompensated services under § 124.508 or until an allocation plan published in accordance with paragraph (a)(2) of this section becomes effective.
(c) A facility may revise its allocation plan during the fiscal year by publishing the revised plan in a newspaper of general circulation in the area it serves. A revised plan may take effect no earlier than 60 days following the date of publication.
(a) Determinations of eligibility must be in writing, be made in accordance with this section, and a copy of the determination must be provided to the applicant promptly.
(b)
(i) That the facility will provide uncompensated services at no charge or at a specified charge less than the allowable credit for the services;
(ii) The date on which services were requested;
(iii) The date on which the determination was made;
(iv) The applicant's individual or family income, as applicable, and family size; and
(v) The date on which services were or will be first provided to the applicant.
(2)
(A) Require the applicant to furnish any information that is reasonably necessary to substantiate eligibility; and
(B) Require the applicant to apply for any benefits under third party insurer or governmental programs to which he/she is or could be entitled upon proper application.
(ii) A conditional determination must:
(A) Comply with paragraph (b)(1) of this section; and
(B) State the condition(s) under which the applicant will be found eligible.
(iii) When a facility determines that the condition(s) upon which a conditional determination was made has been met, or will not be met, it shall make a favorable determination or denial on the request, as appropriate, in accordance with this section.
(3)
(c)
(ii) Nursing homes shall make a determination of eligibility within ten working days, but no later than two working days following the date of admission, following a request for uncompensated services made prior to admission.
(2)
(a)
(1) Cease providing uncompensated services;
(2) Cease providing individual notices in accordance with § 124.504(c);
(3) Remove the posted notices required by § 124.504(b); and
(4) Post an additional notice stating that it has satisfied its obligation for the fiscal year or appropriate period and when additional uncompensated services will be available.
(b)
(1) Cease providing uncompensated services; and
(2) Discontinue providing notice pursuant to § 124.514(b)(2).
(a)
(ii) A facility shall submit the required report more frequently than once every three years under the following circumstances:
(A) If the facility determines that in the preceding fiscal year it did not provide uncompensated services at the annual compliance level, it shall submit a report.
(B) If the Secretary determines, and notifies the facility in writing that a report is needed for proper administration of the program, the facility shall submit a report within 90 days after receiving notice from the Secretary, or within 90 days after the close of the fiscal year, whichever is later.
(iii) Except as specified in paragraph (a)(1)(ii)(B) of this section, the reports required by this section shall be submitted within 90 days after the close of the fiscal year, unless a longer period is approved by the Secretary for good cause.
(2)
(i) Information that the Secretary prescribes to permit a determination of whether a facility has met the annual compliance level for the fiscal years covered by the report;
(ii) The date on which the notice required by § 124.504(a) was published, and the name of the newspaper that printed the notice;
(iii) If the amount of uncompensated services provided by the facility in the preceding fiscal year was lower than the annual compliance level, an explanation of why the facility did not meet the required level. If the facility claims that it failed to meet the required compliance level because it was financially unable to do so, it shall explain and provide documentation prescribed by the Secretary;
(iv) If the facility is required to submit an affirmative action plan, a copy of the plan.
(v) Other information that the Secretary prescribes.
(3)
(b)
(1) A certification, signed by the responsible official of the facility, that there has been no material change in
(2) A certification, signed by the responsible official of the facility and supported by appropriate documentation, that there has been a material change in the factors upon which the certification was based.
(c)
(1)(i) A certification, signed by the responsible official of the facility, that there has been no material change in the factors upon which the certification was based; or
(ii) A certification, signed by the responsible official of the facility and supported by appropriate documentation, that there has been a material change in the factors upon which the certification was based; and
(2) A certification, signed by the responsible official of the facility, of the amount of uncompensated services provided in the previous fiscal year.
(d)
(a)
(i) Any documents from which the information required to be reported under § 124.509(a) was obtained;
(ii) Accounts which clearly segregate uncompensated services from other accounts; and
(iii) Copies of written determinations of eligibility under § 124.507.
(2) A facility shall retain the records maintained pursuant to paragraph (a)(1) for three years after submission of the report required by § 124.509(a)(1), except where a longer period is required by the Secretary, or until 180 days following the close of the Secretary's assessment investigation under § 124.511(b), whichever is less.
(3) A facility shall, within 60 days of the end of each fiscal year, determine the amount of uncompensated services it provided in that fiscal year. Documents that support the facility's determination shall be made available to the public on request. If a report is or will be filed under § 124.509(a)(1), a facility may respond to a request by providing a copy of the report to the requester.
(b)
(c)
(a)
(1) A complaint is considered to be filed with the Secretary on the date the following information is received in the Office of the HHS Regional Health Administrator for the Region in which the facility is located:
(i) The name and address of the person making the complaint or on whose behalf the complaint is made;
(ii) The name and location of the facility;
(iii) The date or approximate date on which the event occurred; and
(iv) A statement of what actions the complainant considers to violate the requirements of this subpart.
(2) The Secretary promptly provides a copy of the complaint to the facility named in the complaint.
(3) When the Secretary investigates a facility, the facility, including a facility certified under § 124.513, § 124.514, § 124.515, or § 124.516, shall provide to the Secretary on request any documents, records and other information concerning its operation that relate to the requirements of this subpart. A facility will be presumed to be out of compliance with its assurance unless it supplies documentation sufficient to show compliance with the applicable provisions of this subpart.
(4) Section 1627 of the Act provides that if the Secretary dimisses a complaint or the Attorney General has not brought an action for compliance within six months from the date on which the compliant is filed, the person filing it may bring a private action to effectuate compliance with the assurance. If the Secretary determines that he/she will be unable to issue a decision on a complaint or otherwise take appropriate action within the six month period, the Secretary may, based on priorities for the disposition of complaints that are established to promote the most effective use of enforcement resources, or on the request of the applicant, dismiss the complaint without a finding as to compliance prior to the end of the six month period, but no earlier than 45 days after the complaint is filed.
(b)
(1)
(ii) A certification of substantial compliance shall be based on the amount properly claimed by the facility pursuant to § 124.509(a), utilizing procedures determined by the Secretary to be sufficient to establish that the facility has substantially complied with its assurance for the period covered by the certification. The procedures will include examination of individual account data to the extent deemed necessary by the Secretary.
(iii) A certification of substantial compliance will be made where the Secretary determines that, for the period covered by the certification, the facility provided uncompensated services to eligible persons who had equal opportunity to apply therefor. In making this determination, the Secretary will consider, in descending order of importance, whether—
(A) Corrective action prescribed pursuant to § 124.512(b) has been taken by the facility;
(B) Any noncompliance with the requirements of this subpart may be remedied by corrective action under § 124.512(b);
(C) The facility had procedures in place that complied with the requirements of §§ 124.504(c), 124.505, 124.507, 124.509, 124.510, 124.513(b)(2), 124.514(b)(2), 124.515, and 124.516 (b)(1) or (b)(2), as applicable, and systematically correctly followed such procedures.
(2)
(c)
(1) The ratio of revenues to expenses;
(2) The occupancy rate;
(3) The ratio of current assets to current liabilities;
(4) The average cost per patient day;
(5) The number of days of operating expenses in accounts payable;
(6) The number of days of revenues in accounts receivable;
(7) The sinking fund (or depreciation fund) balance;
(8) The debt coverage ratio; and
(9) The availability of restricted or unrestricted funds (such as an endowment) available for charitable use.
(a) If the Secretary finds, based on his/her investigation under § 124.511, that a facility did not comply with the requirements of this subpart, the Secretary may take any action authorized by law to secure compliance, including but not limited to, voluntary agreement or a request to the Attorney General to bring an action against the facility for specific performance.
(b) A facility, including a facility certified under § 124.513, § 124.514, or § 124.516, that has denied uncompensated services to any person because it failed to comply with the requirements of this subpart will not be in compliance with its assurance until it takes whatever steps are necessary to remedy fully the noncompliance, including:
(1) Provision of uncompensated services to applicants improperly denied;
(2) Repayment of amounts improperly collected from persons eligible to receive uncompensated services; and
(3) Other corrective actions prescribed by the Secretary.
(c) The Secretary may disallow all of the uncompensated services claimed in a fiscal year where the Secretary finds that the facility was in substantial noncompliance with its assurance because it failed to:
(1) Have a system for providing notice to eligible persons as required by § 124.504(c), § 124.513(b)(2), § 124.514(b)(2), or § 124.516(b)(2)(ii)(A), as applicable;
(2) Comply with the applicable reporting requirements of § 124.509;
(3) Have a system for maintaining records of uncompensated services provided in accordance with § 124.510; or
(4) Take corrective action prescribed pursuant to paragraph (b) of this section.
(d) In the absence of a finding of substantial compliance or substantial noncompliance in a fiscal year, the Secretary may disallow uncompensated services claimed by a facility in that fiscal year to the extent that the Secretary finds that such services are not documented as uncompensated services under § 124.510 or are subject to disallowance under § 124.513(d) or § 124.514(d), as applicable.
(a)
(b)
(1) It is a facility which is owned and operated by a unit of State or local government or a quasi-public corporation as defined at 42 CFR 124.2(m).
(2) It provides health services without charge or at a substantially reduced rate to persons who are determined by the facility to qualify therefor under a program of discounted health services. A “program of discounted health services” must provide for financial and other objective eligibility criteria and procedures, including notice prior to nonemergency service, that assure effective opportunity for all persons to apply for and obtain a determination of eligibility for such services, including a determination prior to service where requested;
(3)(i) It received, for the three most recent fiscal years, at least 10 percent of its total operating revenue (net patient revenue plus other operating revenue, exclusive of any amounts received, or if not received, claimed, as reimbursement under titles XVIII and XIX of the Social Security Act) from State and local tax appropriations or other State and local government revenues, or from a quasi-public corporation as defined at 42 CFR 124.2(m), to cover operating deficits attributable to the provision of discounted services; or
(ii) If provided, in each of the three most recent fiscal years, uncompensated services under this subpart or under programs described by the documentation provided under § 124.513(c)(2) in an amount not less than twice the annual compliance level computed under § 124.503(a).
(c)
(1) Audited financial statements or official State or local government documents (such as annual reports or budget documents), for the three most recent fiscal years, sufficient to show that the facility meets the criteria in paragraph (b)(3)(i) or (ii) of this section.
(2) A complete description of its program(s) of discounted health services, including charging and collection policies of the facility, and eligibility criteria and notice and determination procedures used under its program(s) of discounted services.
(d)
(2)
(A) Demonstrating to the Secretary's satisfaction, that it met the requirements of paragraph (b) of this section for each year in which a deficit was assessed; or
(B) Providing an additional period of service under this section on the basis of one (or portion of a) year of certification for each year (or portion of a year) of deficit assessed. The period of obligation applicable to the facility under § 124.501(b) shall be extended until the deficit is made up in accordance with the preceding sentence.
(ii)
(A) Make up such deficit in accordance with paragraph (d)(2)(i) of this section; or
(B) Submit an independent certified audit, conducted in accordance with procedures specified by the Secretary, of the facility's records maintained pursuant to § 124.510. If the audit establishes to the Secretary's satisfaction that no, or a lesser, deficit exists for the period in question, the facility will receive credit for the period so justified. Any deficit which the Secretary
(iii)
(B) A facility assisted under title XVI of the Act whose compliance with this subpart has not been completely assessed will be presumed to have no allowable credit for the unassessed period. The facility may make up the deficit by—
(
(
(a)
(b)
(1)(i) Title VI-assisted facilities. (A) For the facility's fiscal year in which this section becomes effective, the level, computed under § 124.503(c) (3), divided by the number of years remaining in its period of obligation (including an additional year or portion of a year for each year or portion of a year in which a deficit was incurred and has not been made up), is not more than $10,000;
(B) For a subsequent fiscal year, the level computed under paragraph (A) of this paragraph (b)(1)(i), is at or less than $10,000, adjusted by a percentage equal to the percentage change in the CPI available in the year in which this section becomes effective and the most recent year for which a published index is available.
(ii)
(B) For a subsequent fiscal year, the level, computed under paragraph (A) of this paragraph (b)(1)(ii), is at or less than $10,000, adjusted as provided in paragraph (b)(1)(i)(B) of this section.
(2) It provides health services without charge or at a substantially reduced rate to persons who are determined by the facility to qualify threrefor under a program of discounted health services. A “program of discounted health services” must provide for financial and other objective eligibility criteria and procedures, including notice prior to nonemergency service, that assure effective opportunity for all persons to apply for and obtain a determination of eligibility for such services, including a determination prior to service where requested;
(c)
(d)
(e)
(2) Where a facility has been assessed as having a deficit under § 124.503(b) that has not been made up prior to withdrawal of certification under this section or fails to provide services as required by paragraph (d) of this section, the facility must make up the deficit in accordance with § 124.503(b) following withdrawal of certification.
(a)
(b)
(i) Demonstrating to the Secretary's satisfaction that it met the requirements of paragraph (a) of this section for each year in which a deficit was assessed; or
(ii) Providing an additional period of service under this section on the basis of one (or portion of a) year of certification for each year (or portion of a year) of deficit assessed. The period of obligation applicable to the facility under § 124.501(b) shall be extended until the deficit is made up in accordance with the preceding sentence.
(2)
(i) Make up such deficit in accordance with paragraph (b)(1) of this section; or
(ii) Submit an independent certified audit, conducted in accordance with procedures specified by the Secretary, of the facility's records maintained pursuant to § 124.510. If the audit establishes to the Secretary's satisfaction that no, or a lesser, deficit exists for the period in question, the facility will
(3)
(ii) A facility assisted under title XVI of the Act whose compliance with this subpart has not been completely assessed will be presumed to have no allowable credit for the unassessed period. The facility may make up the deficit by—
(A) Following the procedure of paragraph (b)(3)(i) of this section; or
(B) Submitting an independent certified audit, conducted in accordance with procedures specified by the Secretary, of the facility's records maintained pursuant to § 124.510. If the audit establishes to the Secretary's satisfaction that no, or a lesser, deficit exists for the period in question, the facility will receive credit for the period so justified. Any deficit which the Secretary determines still remains must be made up in accordance with paragraph (b)(3)(i) of this section.
(a)
(b)
(1)(i)
(ii)
(2)(i) It received, for the three most recent fiscal years, at least 10 percent of its total operating revenue (net patient revenue plus other operating revenue, exclusive of any amounts received, or if not received, claimed, as reimbursement under titles XVIII and XIX of the Social Security Act) from philanthropic sources to cover operating deficits attributable to the provision of discounted services. Philanthropic sources include private trusts, foundations, churches, charitable organizations, state and/or local funding, and individual donors; and either—
(ii) (A) Provides health services without charge or at a substantially reduced rate (exclusive of amounts charged or received for purposes of claiming reimbursement under third party insurance or governmental programs, such as Medicaid or Medicare deductible or coinsurance amounts) to persons who are determined by the facility to qualify therefor under a program of discounted health services. A “program of discounted health services” must provide for financial and other objective eligibility criteria and procedures, including notice prior to nonemergency service, that assure effective opportunity for all persons to apply for and obtain a determination of eligibility for such services including a
(B) Makes all services of the facility available to all persons at no more than a nominal charge, exclusive of amounts charged or received for purposes of claiming reimbursement under third party insurance or governmental programs, such as Medicaid or Medicare deductible or coinsurance amounts.
(c)
(1) Audited financial statements for the three most recent fiscal years or other documents prescribed by the Secretary, sufficient to show that the facility meets the criteria of paragraph (b)(1) or (b)(2) of this section.
(2)(i) Where the facility claims qualification under paragraph (b)(2)(ii)(A) of this section, a complete description, and documentation where requested, of its program of discounted health services, including charging and collection policies of the facility, and eligibility criteria and notice and determination procedures used under its program(s) of discounted health services.
(ii) Where the facility claims qualification under paragraph (b)(1) or paragraph (b)(2)(ii)(B) of this section, a complete description, and documentation where requested, of its admission, charging, and collection policies.
(d)
(2)
(A) Demonstrating to the Secretary's satisfaction that it met the applicable requirements of paragraph (b) of this section for each year in which a deficit was assessed; or
(B) Providing an additional period of service under this section on the basis of one year (or portion of a year) of certification for each year (or portion of a year) of deficit assessed. The period of obligation applicable to the facility under § 124.501(b) shall be extended until the deficit is made up in accordance with the preceding sentence.
(ii) Where any period of compliance under this subpart of a facility assisted under title VI of the Act has not been assessed, the facility will be presumed to have no allowable credit for such period. The facility may either—
(A) Make up such deficit in accordance with paragraph (d)(2)(i) of this section; or
(B) Submit an independent certified audit, conducted in accordance with procedures specified by the Secretary, of the facility's records maintained pursuant to § 124.510. If the audit establishes to the Secretary's satisfaction that no, or a lesser, deficit exists for the period in question, the facility will receive credit for the period so justified. Any deficit which the Secretary determines still remains must be made up in accordance with paragraph (d)(2)(i) of this section.
(iii)
(B) A facility assisted under title XVI of the Act whose compliance with this subpart has not been completely assessed will be presumed to have no allowable credit for the unassessed period. The facility may make up the deficit by—
(
(
(a) Where the Secretary finds that it will promote the purposes of this subpart and the State agency is able and willing to do so, the Secretary may enter into an agreement with an agency of a State to assist in administering this subpart in the State. An agreement may be terminated by the Secretary or the State agency on 60 days notice.
(b) Under an agreement the State agency will provide any assistance the Secretary requests in any one or more of the following areas, as set out in the agreement:
(1) Investigation of complaints regarding noncompliance;
(2) Monitoring compliance of facilities with the requirements of this subpart;
(3) Review of reports submitted under § 124.509, including affirmative action plans;
(4) Making initial decisions for the Secretary with respect to compliance, subject to appeal by any party to the Secretary, or review by the Secretary on the Secretary's initiative; and
(5) Application of any sanctions available to it under State law (such as license revocation or termination of State assistance) against facilities determined to be out of compliance with the requirements of this subpart.
(c) Nothing in this subpart precludes any State from taking any action authorized by State law regarding the provision of uncompensated services by facilities in the State as long as the action taken does not prevent the Secretary from enforcing the requirements of this subpart.
Secs. 215, 1525, 1602(6), Public Health Service Act as amended; 58 Stat 690, 88 Stat. 2249, 2259; 42 U.S.C. 216, 300m-4, 300o-1(6).
The provisions of this subpart apply to any recipient of Federal assistance under title VI or XVI of the Public Health Service Act that has given an assurance that it would make the facility or portion thereof assisted available to all persons residing (and, in the case of title XVI assisted applicants, employed), in the territorial area it serves. This assurance is referred to in this subpart as the “community service assurance.”
As used in this subpart:
(a)
(2) A person is residing in the facility's service area for purposes of this section if the person:
(i) Is living in the service area with the intention to remain there permanently or for an indefinite period;
(ii) Is living in the service area for purposes of employment; or
(iii) Is living with a family member who resides in the service area.
(b)
(2) A facility may discharge a person that has received emergency services, or may transfer the person to another facility able to provide necessary services, when the appropriate medical personnel determine that discharge or transfer will not subject the person to a substantial risk of deterioration in medical condition.
(c)
(i) Those principal State and local governmental third-party payors that provide reimbursement for services that is not less than the actual costs, as determined in accordance with accepted cost accounting principles; and
(ii) Federal governmental third-party programs, such as medicare and medicaid.
(2) The facility shall take any necessary steps to insure that admission to and services of the facility are available to beneficiaries of the governmental programs specified in paragraph (c)(1) of this section without discrimination or preference because they are beneficiaries of those programs.
(d)
(1) A facility has a policy or practice of admitting only those patients who are referred by physicians with staff privileges at the facility. If this policy or practice has the effect of excluding persons who reside (or for title XVI facilities, are employed) in the community from the facility because they do not have a private family doctor with staff privileges at the facility, the facility would not be in compliance with its assurance. The facility is not required to abolish its staff physician admissions policy as a usual method for admission. However, to be in compliance with its community service assurance it must make alternative arrangements to assist area residents who would otherwise be unable to gain admission to obtain services available in the facility. Examples of alternative arrangements a facility might use include:
(i) Authorizing the individual's physician, if licensed and otherwise qualified, to treat the patient at the facility even though the physician does not have staff privileges at the facility;
(ii) For those patients who have no physician, obtaining the voluntary agreement of physicians with staff privileges at the facility to accept referrals of such patients, perhaps on a rotating basis;
(iii) If an insufficient number of physicians with staff privileges agree to participate in a referral arrangement,
(iv) Establishing a hospital-based primary care clinic through which patients needing hospitalization may be admitted; or
(v) Hiring or contracting with qualified physicians to treat patients who do not have private physicians.
(2) A facility, as required, is a qualified provider under the title XIX medicaid program, but few or none of the physicians with staff privileges at the facility or in a particular department or sub-department of the facility will treat medicaid patients. If the effect is that some medicaid patients are excluded from the facility or from any service provided in the facility, the facility is not in compliance with its community service assurance. To be in compliance a facility does not have to require all of its staff physicians to accept medicaid. However, it must take steps to ensure that medicaid beneficiaries have full access to all of its available services. Examples of steps that may be taken include:
(i) Obtaining the voluntary agreement of a reasonable number of physicians with staff privileges at the facility and in each department or sub-department to accept referral of medicaid patients, perhaps on a rotating basis;
(ii) If an insufficient number of physicians with staff privileges agree to participate in a referral arrangement, requiring acceptance of referrals as a condition to obtaining or renewing staff privileges;
(iii) Establishing a clinic through which medicaid beneficiaries needing hospitalization may be admitted; or
(iv) Hiring or contracting with physicians to treat medicaid patients.
(3) A facility requires advance deposits (pre-admission or pre-service deposits) before admitting or serving patients. If the effect of this practice is that some persons are denied admission or service or face substantial delays in gaining admission or service solely because they do not have the necessary cash on hand, this would constitute a violation of the community service assurance. While the facility is not required to forego the use of a deposit policy in all situations, it is required to make alternative arrangements to ensure that persons who probably can pay for the services are not denied them simply because they do not have the available cash at the time services are requested. For example, many employed persons and persons with other collateral do not have savings, but can pay hospital bills on an installment basis, or can pay a small deposit. Such persons may not be excluded from admission or denied services because of their inability to pay a deposit.
(a) The facility shall post notices, which the Secretary supplies in English and Spanish, in appropriate areas of the facility, including but not limited to the admissions area, the business office and the emergency room.
(b) If in the service area of the facility the “usual language of households” of ten percent or more of the population, according to the most recent figures published by the Bureau of the Census, is other than English or Spanish, the facility shall translate the notice into that language and post the translated notice on signs substantially similar in size and legibility to, and posted with, those supplied under paragraph (a) of this section.
(c) The facility shall make reasonable efforts to communicate the contents of the posted notice to persons who it has reason to believe cannot read the notice.
(a)
(ii) A facility shall also submit the required report whenever the Secretary determines, and so notifies the facility in writing, that a report is needed for proper administration of the program.
(2)
(3) The facility shall provide a copy of any report to the HSA for the area when submitting it to the Secretary.
(4)
(b)
(a)
(2)(i) A complaint is filed with the Secretary on the date on which the following information is received in the Office of the Regional Health Administrator for the Region of HHS in which the facility is located:
(A) The name and address of the person making the complaint or on whose behalf the complaint is made;
(B) The name and location of the facility;
(C) The date or approximate date on which the event complained of occurred, and
(D) A statement of what actions the complainant considers to violate the requirements of this subpart.
(ii) The Secretary promptly provides a copy of the complaint to each facility named in the complaint.
(3) When the Secretary investigates a facility, the facility shall provide to the Secretary on request any documents, records and other information concerning its operations that relate to the requirements of this subpart.
(4) The Act provides that if the Secretary dismisses a complaint or the Attorney General has not brought an action for compliance within six months from the date on which the complaint is filed, the person filing it may bring a private action to effectuate compliance with the assurance. If the Secretary determines that he will be unable to issue a decision on a complaint or otherwise take appropriate action within the six month period, he may, based on priorities for the disposition of complaints that are established to promote the most effective use of enforcement resources, or on the request of the complainant, dismiss the complaint without a finding as to compliance prior to the end of the six month period, but no earlier than 45 days after the complaint is filed.
(b)
(2) If the Secretary finds, based on his investigation under paragraph (a) of this section, that a facility has limited the availability of its services in a manner proscribed by this subpart, he may, in addition to any other action that he is authorized to take in accordance with the Act, require the facility
(a) Where the Secretary finds that it will promote the purposes of this subpart, and the State agency is able and willing to do so, he may enter into an agreement with the State agency for the State agency to assist him in administering this subpart in the State.
(b) Under an agreement, the State agency will provide the Secretary with any assistance he requests in any one or more of the following areas, as set out in the agreement:
(1) Investigation of complaints of noncompliance;
(2) Monitoring the compliance of facilities with the requirements of this subpart;
(3) Review of affirmative action plans submitted under § 124.606(b);
(4) Review of reports submitted under § 124.605;
(5) Making initial decisions for the Secretary with respect to compliance, subject to appeal by any party to the Secretary or review by the Secretary on his own initiative; and
(6) Application of any sanctions available to it under State law (such as license revocation or termination of State assistance) against facilities determined to be out of compliance with the requirements of this subpart.
(c) A State agency may use funds received under section 1525 of the Act to pay for expenses incurred in the course of carrying out this agreement.
(d) Nothing in this subpart precludes any State from taking any action authorized by State law regarding the provision of services by any facility in the State as long as the action taken does not prevent the Secretary from enforcing the requirements of this subpart.
In performing reviews under section 1513 (e) of the Public Health Service Act (42 U.S.C. 3001-2(c)) of applications for grants under section 1625 of the Act, health systems agencies shall use the procedures and criteria stated below. A health systems agency may not conduct such reviews until the procedures and criteria to be used in conducting the reviews have been adopted by the agency and published in newspapers of general circulation within the health service area or other public information channels.
The procedures adopted and utilized by a health systems agency for conducting reviews of applications for grants under section 1625 of the Act shall include at least the following: 1. Except as provided below, notification of the beginning of a review within seven days of the receipt by the health systems agency of the application. Where the application was received by the health systems agency prior to publication of this subpart in the
2. Schedules for reviews which provide that such reviews shall not exceed 60 days from the date of notification made in accordance with paragraph 1 of this section to the date of the written findings made in accordance with paragraph 4 of this section. This does
3. Provision for applicants to submit to the health systems agency (in such form and manner as the agency shall require) such information as the agency deems necessary in order to conduct its review.
4. Written findings which state the basis for the approval or disapproval of the application by the health systems agency. Such findings shall be sent to the applicant, the State health planning and development agency (or agencies), and the Secretary, and shall be available to other upon request.
5. Access by the general public to all such applications reviewed by the health systems agency and to all other written materials pertinent to the agency review.
6. Public hearings in the course of agency review, if requested by one or more persons directly affected by the review. For purposes of this paragraph, a “person directly affected by the review” is as defined in 42 CFR 122.306 (a)(7).
The specific criteria adopted and utilized by a health systems of this agency to conduct reviews of applications for grants under section 1625 of the Act shall include at least the following:
1. The relationship of the health services of the facility to the applicable health systems plan and annual implementation plan.
2. The relationship of the health services of the facility to the long-range development plan (if any) of the applicant.
3. The need that the population served or to be served by the facility has for the health services of such facility.
4. The availability of alternative, less costly, or more effective methods of providing the health services which the facility provides.
5. The relationship of the health services provided by the facility to the existing health care system of the area.
6. The availability of resources (including health manpower, management personnel, and funds for capital and operating needs) for the provision of services by the facility and the availability of alternative uses of such resources for the provision of other health services.
7. The special needs and circumstances of those entities which provide a substantial portion of their services or resources, or both, to individuals not residing in the health service area in which the entities are located or in adjacent health service areas. Such entities may include medical and other health professions schools, multidisciplinary clinics, and other speciality centers.
8. The special needs and circumstances of health maintenance organizations for which assistance may be provided under title XIII.
9. The costs and methods of the proposed construction or modernization, including the costs and methods of energy provision.
10. The probable impact of the project reviewed on the applicant's costs of providing health services.
Secs. 609 and 1622 of the Public Health Service Act as amended 98 Stat. 112 (42 U.S.C. 291i and 300s-1a).
The provisions of this subpart apply to facilities with respect to which grant funds were paid for construction or modernization—
(a) Under title VI or XVI of the Public Health Service Act; or
(b) Pursuant to the authority of the Secretary under any of the following statutes:
(1) The Public Works Acceleration Act of 1962, Pub. L. 87-658 (42 U.S.C. 2641
(2) The District of Columbia Medical Facilities Construction Act of 1968, 82 Stat. 631 (Pub. L. 90-457);
(3) The Appalachian Regional Development Act of 1965, as amended (40 U.S.C. App.).
As used in this subpart—
(a) If any facility is at any time within 20 years after the completion of the grant-assisted construction or modernization sold or transferred to any entity which is either not qualified for a grant under the statute pursuant to which the grant was awarded or not approved as a transferee by the State agency, the United States shall be entitled to recover on the basis of joint and several liability from any transferor, transferee, or successive transferee of the facility an amount determined in accordance with this subpart.
(b) If any facility at any time within 20 years after the completion of the grant-assisted construction or modernization ceases to be a public or other non-profit facility that would have been eligible for a grant under the statute pursuant to which the grant was awarded, the United States shall be entitled to recover from the owners of the facility an amount determined in accordance with this subpart.
(a) The transferor of a facility that is sold or transferred as described in § 124.703(a), or the owner of a facility which ceases to be a public or other nonprofit facility as described in § 124.703(b), shall provide the Secretary written notice of such sale, transfer, or other change not later than 10 days after the date on which the sale, transfer, or change occurs.
(1)
(2)
(i) A facility “ceases to be” a facility for which a grant could have been made under the statute pursuant to which the grant was awarded when it is no longer operated as such a facility; and
(ii) A facility “ceases to be a public or nonprofit facility” when an entity that is not a public or other non-profit corporation or association assumes management responsibilities with respect to the facility which, in the Secretary's judgment, are so pervasive as to constitute operation of the facility. The manager will not be deemed to be the operator of the facility if the management agreement contains both of the following provisions:
The Board of Directors of the facility retains authority to terminate the agreement at any time upon reasonable notice to the contractor.
No employee of the contractor may be a member of the facility's Board of Directors.
(b)
(1) The date of the sale, transfer, or other event that gives rise to the notice;
(2) Copies of any sales contracts, lease agreements, management contracts or other documents pertinent to the event giving rise to the notice;
(3) Estimates of current assets, current liabilities, book value of equipment, the expected value of land on the
(c)
(a) Except as provided in § 124.706, the amount that the United States shall be entitled to recover under this subpart is that amount bearing the same ratio to the then value of so much of the facility as constituted an approved project (or projects) as the amount of Federal participation bore to the cost of the construction or modernization under such project (or projects).
(b) The then value of the facility will be based on:
(1) The transaction value in the case of an arms-length sale or transfer, or
(2) A depreciated reproduction value in the absence of an arms-length sale or transfer or if the buyer fails to provide, within 60 days after the date of the Secretary's letter described in § 124.704(c), the information which, in the judgment of the Secretary, is necessary to establish, adjust, and apportion a transaction value. As used in this section, “transaction value” means in the case of a sale, the sale price, and in the case of a lease, the value of the lease plus the residual value of the facility at the termination of the lease (i.e., the reproduction value or, if appropriate, an alternative use value).
(c) The transaction value will be adjusted to account for the purchase or lease of other assets and the assumption of liabilities associated with the transaction. To determine the amount of Federal recovery, the adjusted value will be apportioned to the grant-aided assets by the ration of the remaining useful lifetime values of those assets to the sum of the remaining useful lifetime values of all assets not previously accounted for in adjusting the transaction value.
(d) A depreciated reproduction value will be established by calculating a reproduction value using construction cost indexes or current costs per square foot for construction, depending on which is more relevant to the type of construction associated with the grant. This reproduction value will then be adjusted by the ratio of the remaining useful life to the total useful life for the assets involved.
(e) In calculating the recovery amount, the Secretary will include as Federal participation any grant assistance received by the facility under an authority listed in § 124.701 and any assistance supplementary to that assistance received for the construction or modernization of the facility under the Public Works and Economic Development Act of 1965 (42 U.S.C. 3121,
(a) In addition to the amount of recovery calculated under § 124.705, the United States shall be entitled to recover interest on such amount in accordance with this section at the rate determined by the Secretary based on the average of the bond equivalent of the weekly ninety-day U.S. Treasury bill auction rate for the quarter previous to the quarter in which interest begins to accrue under this section.
(1)
(2)
(b) The Secretary may waive interest charges that result from delays caused solely by the Department.
(a)
(1) Has filed a written request for the waiver within the time limits prescribed by this section;
(2) Has established an irrevocable trust in accordance with this section, in an amount equal to the greater of the amount that would otherwise have been recovered pursuant to § 124.705 (including accrued interest as calculated under § 124.706) or twice the cost of the remaining uncompensated services obligation of the facility as of the date of the change of status, that will be used by the entity only to provide services to those unable to pay in accordance with the requirements of subpart F of this part; and
(3) Has agreed to comply with the community service regulations set out in subpart G of this part.
(b)
(i)
(B) For a facility which changes status after the date that subpart F of this part is effective for the facility, the Secretary will multiply the annual compliance level, computed under the 10% method specified in 42 CFR 124.503(a)(1)(ii), for the fiscal year in which the change of status occurs times the number of years remaining in the facility's uncompensated services obligation. From this amount, the Secretary will subtract amounts of excess or add amounts of deficit for each fiscal year prior to the change of status for which the Secretary has previously conducted an audit of uncompensated services accounts. Excess and deficits will be adjusted by the percent change in the National Consumer Price Index for Medical Care between the year in which the excess or deficit occurred and the year in which the status change occurred. For each fiscal year prior to the change of status which the Secretary has not audited, the Secretary will add to the remaining obligation an amount equal to the annual compliance level in each such year adjusted by the percent change in the National Consumer Price Index for Medical Care between that year and the year of the status change. The amount computed as the total remaining obligation will then be multiplied by two. If the transferee chooses to accept the Secretary's calculation, no further assessments will be made of uncompensated care provided prior to the change of status date. If the transferee does not accept the calculation, the transferor or transferee may hire, and may charge against the irrevocable trust established under this section, an independent auditor to certify the compliance level and any excess or deficit for the period from May 18, 1979, up to and including the date of the change of status, using standard Departmental procedures supplemented with instructions provided by the Secretary, and submit the results in accordance with paragraph (b)(2)(ii) of this section. The audit may be conducted for any years
(ii)
(2) Within 60 days following the date of the Secretary's letter provided pursuant to paragraph (b)(1) of this section, the owner of the facility shall notify the Secretary in writing that it either:
(i) Accepts the trust fund amount for the waiver as offered by the Secretary;
(ii) Provides a detailed statement of an alternative determination of the recovery amount or an independent audit of the remaining uncompensated services obligation as described in paragraph (b)(1)(i) of this section; or
(iii) Does not seek a waiver under § 124.707. Failure to provide a timely response to the Secretary under this subparagraph will be considered an election not to seek the waiver.
(3) Within 30 days following the receipt of the owner's views concerning the calculation, and after considering those views, the Secretary will send a final letter providing the Secretary's determination of twice the remaining uncompensated care obligation and the recovery amount under § 124.705. The amount to be placed in the irrevocable trust will be the higher of those two figures. (See paragraph (a)(2) of this section.)
(4) Within 30 days of the date of the final letter, the owner of the facility shall notify the Secretary in writing whether or not it accepts the terms of the waiver. Failure to provide timely notice to the Secretary under this subparagraph will be considered an election not to accept the waiver.
(c)
(i) The owner shall provide a copy of the trust documents to the Secretary and no trust shall be considered established until the trust documents have been approved by the Secretary; and
(ii) The owner may credit against the trust any uncompensated services provided in accordance with subpart F of this part between the date of the change of status of the facility and the establishment of the trust. For an owner to receive the credit before the establishment of the trust and deposit of funds therein, the auditor's report covering the post-transfer period shall be submitted with the notification of acceptance of the waiver, and in any event, not later than 30 days from the date of the Secretary's final letter described in paragraph (b)(3) of this section. Within 30 days following the receipt of the auditor's report, the Secretary will notify the owner of the allowable credit, if any. If the auditor's report is not timely submitted, the trust must be established and fully funded, in accordance with the time limits imposed by paragraph (c)(1) of this section, and the Secretary will notify the owner of the allowable credit, if any, within 30 days of the date of the establishment of the trust or within 30 days of the receipt of the report, whichever is later.
(2) The trust shall be administered by a Trustee who is neither an employee of the transferee nor an employee of a
(3) The trust shall provide that the trust corpus and income may be invested only in U.S. Government or U.S. Government insured securities.
(d)
The Secretary may for good cause waive the recovery rights of the United States arising under § 124.703(b). In determining whether there is good cause under this section for releasing the applicant or other owner of the facility from its obligation, the Secretary will take into consideration the extent to which:
(a) The facility will be devoted by the applicant or other owner to use for another public or nonprofit purpose whch will promote the purpose of the Act;
(b) There are reasonable assurances that for the remainder of the 20-year period other public or nonprofit facilities not previously utilized for the purpose for which the facility was constructed will be so utilized and are substantially equivalent in nature and purpose.
(c) The facility has been acquired from an agency of the United States (e.g., the Federal Housing Administration under its mortgage insurance commitment program) which has made a reasonable effort to dispose of it for operation as a public or nonprofit health care facility.
(a) Any waiver granted under this subpart is conditioned upon the recipient of the waiver carrying out the obligations imposed by § 124.707 or § 124.708 as applicable.
(b) The Secretary will monitor compliance with the community service and uncompensated care obligations of any entity that receives a waiver.
(c) Should a recipient of a waiver fail to comply with the applicable conditions, the Secretary will withdraw the waiver and seek recovery based on the value of the facility on the date the right of recovery first arose under § 124.703.
(d) No waiver will be withdrawn until the recipient has been notified in writing by the Secretary of the noncompliance and has failed to take corrective action within 90 days after the date of such notice.
(e) Should the waiver be withdrawn, the amount of the Government's recovery will be the amount set out in the Secretary's determination letter as described in § 124.707 (b)(1) or (b)(3) as applicable plus interest from the date of the notification sent in accordance with paragraph (d) of this section.