[Federal Register Volume 78, Number 38 (Tuesday, February 26, 2013)]
[Rules and Regulations]
[Pages 12953-12955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-03416]
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DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 199
[Docket ID: DOD-2011-HA-0035]
RIN 0720-AB49
TRICARE; TRICARE Sanction Authority for Third-Party Billing
Agents
AGENCY: Office of the Secretary, Department of Defense.
ACTION: Final rule.
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SUMMARY: This final rule will provide the Director, TRICARE Management
Activity (TMA), or designee, with the authority to sanction third-party
billing agents by invoking the administrative remedy of exclusion or
suspension from the TRICARE program. Such sanctions may be invoked in
situations involving fraud or abuse on the part of third-party billing
agents that prepare or submit claims presented to TRICARE for payment.
DATES: Effective date: This rule is effective March 28, 2013.
FOR FURTHER INFORMATION CONTACT: Ms. Ann N. Fazzini, Medical Benefits
and Reimbursement Branch, TMA, telephone, (303) 676-3803.
SUPPLEMENTARY INFORMATION:
I. Executive Summary and Overview
A. Purpose of the Regulatory Action
As stated in the proposed rule, TRICARE has regulatory authority
under 32 Code of Federal Regulations (CFR) 199.9 to invoke sanctions in
situations involving fraud or abuse on the part of providers of TRICARE
services. A provider is defined in 32 CFR 199.2 as, ``A hospital or
other institutional provider, a physician, or other individual
professional provider, or other provider of services or supplies as
specified in Sec. 199.6 of this part.'' Third-party billing agents do
not meet the definition of a provider as stated in 32 CFR 199.2, nor do
TRICARE regulations currently define third-party billing agents.
Title 42 of the CFR subpart C--Exclusions at 42 CFR 402.200(b)(1)
provides for the imposition of an exclusion from the Medicare and
Medicaid programs (and, where applicable, other Federal health care
programs) against persons that violate the provisions provided in Sec.
402.1(e) (and further described in Sec. 402.1(c)). However, TRICARE
had no independent regulatory authority to sanction or exclude third-
party billing agents. This final rule provides that authority.
B. Summary of Major Provisions
This final rule establishes that such entities, when acting on
behalf of a provider, are held to an equal standard in regard to
accuracy and honesty when filing claims for services and supplies under
the TRICARE program. As such, these entities should be subject to the
same administrative controls applied to providers in ensuring that
funds are disbursed appropriately. This rule will allow TRICARE to
sanction third-party billing agents to prevent the payment of false or
improper billings.
C. Summary of Costs and Benefits
By expanding the scope of sanctioning authority to include third-
party billing agents, TRICARE costs are not anticipated to increase in
this area. Rather, by expanding the sanctioning authority to include
third-party billing agents in situations of fraud or abuse, the program
is safeguarding benefit dollars from being expended for fraudulent or
abusive charges. The anticipated result of this final rule is a savings
benefit to the program.
II. Department of Defense Inspector General Report on TRICARE Controls
Over Claims Prepared by Third-Party Billing Agents
The Department of Defense, Office of Inspector General (DoD IG)
initiated an audit in February 2008 to review TRICARE controls over
claims submitted by third-party billing agents (Department of Defense
Inspector General Report No. D-2009-037--``TRICARE Controls Over Claims
Prepared by Third-Party Billing Agencies''). The DoD IG published a
report on December 31, 2008. The report included a recommendation that
the Director, TMA strengthen internal controls by initiating action to
obtain statutory or regulatory authority to sanction billing agencies
or any entities that prepare or submit improper health care claims to
TRICARE contractors.
[[Page 12954]]
III. Review of Public Comments
In the Federal Register of September 20, 2011, (76 FR 58202), the
Office of the Secretary of Defense published for public comment a
Proposed Rule regarding sanction authority for third-party billing
agents.
We received one comment on the proposed rule. The commenter
recommended that the Code of Federal Regulations (CFR) rule be expanded
to prohibit sanctioned providers or third party billing agents from
pursing collection activities against patients in the event that
sanctions are implemented. We appreciate this comment and note that
there is presently policy and regulations that address this issue. By
their very nature, third-party billing agents have a contractual
relationship with the health care provider that requires them to file
claims on behalf of the provider. This should normally require that the
third-party billing agreement meet the claims filing requirements of
the entity or agency that would be paying the claim. In the case of a
DoD beneficiary, claims must be filed in accordance with the Code of
Federal Regulations, including the requirements relating to the maximum
allowable payments and any balance billing limitations. Additionally,
TRICARE benefit payments are payable directly to the provider, not the
third-party billing agent, as federal regulations prohibit the general
assignment of claims. The agent has no independent right to payment
from either TRICARE or the beneficiary.
Per 32 CFR 199.9(h)(4)(i)(c), participating providers are
considered to have forfeited or waived any right or entitlement to bill
TRICARE beneficiaries for care involved in claims for services
furnished on or after the effective date of the provider's exclusion or
suspension. As a result, any third-party billing agent purporting to
act on behalf of a sanctioned provider would also be prohibited from
billing TRICARE beneficiaries on behalf of that provider. Additionally,
if the proposed authority to sanction third-party billing agents is
invoked, a suspended or excluded third-party billing agent would also
be prohibited from submitting a claim to TRICARE on behalf of any
authorized provider or to bill any TRICARE beneficiary directly. Any
claim received from an excluded third-party billing agent would be
returned to the provider with instructions to resubmit the claim
directly or through another third-party billing agent. As long as the
provider of services has not been sanctioned and remains an authorized
TRICARE provider pursuant to the requirements in 32 CFR 199.6, the
provider remains entitled to reimbursement for covered services. Under
either of these scenarios, TRICARE beneficiaries should not be subject
to collection actions.
It is also important to note that the authority sought under the
proposed rule to sanction third-party billing agents by invoking
administrative remedies under 32 CFR 199.9 is in addition to, and not
in lieu of, any other remedies or sanctions authorized by law or
regulation, including potential criminal convictions and civil
judgments for fraud and abuse.
IV. Regulatory Procedures
Executive Order 12866, ``Regulatory Planning and Review'' and Executive
Order 13563, ``Improving Regulation and Regulatory Review''
Sec. 801 of Title 5, United States Code (U.S.C.), and Executive
Orders 12866 and 13563 require certain regulatory assessments and
procedures for any major rule or significant regulatory action, defined
as one that would result in an annual effect of $100 million or more on
the national economy of which would have other substantial impacts.
This final rule is not a significant regulatory action.
Public Law 104-4, Section 202, ``Unfunded Mandates Reform Act''
Section 202 of Public Law 104-4, ``Unfunded Mandates Reform Act,''
requires that an analysis be performed to determine whether any Federal
mandate may result in the expenditure by State, local and tribal
governments, in the aggregate, or by the private sector of $100 million
in any one year. It has been certified that this final rule does not
contain a Federal mandate that may result in the expenditure by State,
local and tribal governments, in aggregate, or by the private sector of
$100 million or more in any one year, and thus this rule is not subject
to this requirement.
Public Law 96-354, ``Regulatory Flexibility Act'' (RFA) (5 U.S.C. 601)
Public Law 96-351, ``Regulatory Flexibility Act'' (RFA) (5 U.S.C.
601), requires each Federal agency to prepare a regulatory flexibility
analysis when the agency issues a regulation which would have a
significant impact on a substantial number of small entities. This
final rule is not an economically significant regulatory action, and it
has been certified that it will not have a significant impact on a
substantial number of small entities. Therefore, this final rule is not
subject to the requirements of RFA.
Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter 35)
This final rule does not contain a ``collection of information''
requirement, and will not impose additional information collection
requirement on the public under Public Law 96-511, ``Paperwork
Reduction Act'' (44 U.S.C. Chapter 35).
Executive Order 13132, ``Federalism''
E.O. 13132, ``Federalism,'' requires that an impact analysis be
performed to determine whether the rule has federalism implications
that would have substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government. It has been certified that this final rule does not have
federalism implications, as set forth in E.O. 13132.
List of Subjects in 32 CFR Part 199
Claims, Dental health, Health care, Health insurance, Individuals
with disabilities, Military personnel.
Accordingly, DoD amends 32 CFR part 199 as follows:
PART 199--CIVILIAN HEALTH AND MEDICAL PROGRAM OF THE UNIFORMED
SERVICES (CHAMPUS)
0
1. The authority citation for part 199 continues to read as follows:
Authority: 5 U.S.C. 301; 10 U.S.C. chapter 55.
0
2. Section 199.2 is amended by adding in alphabetical order to
paragraph (b), a definition of ``Third-party billing agent'' to read as
follows:
Sec. 199.2 Definitions
* * * * *
(b) * * *
Third-party billing agent. Any entity that acts on behalf of a
provider to prepare, submit and monitor claims, excluding those
entities that act solely as a collection agency.
* * * * *
0
3. Section 199.9 is amended by adding paragraph (n) to read as follows:
Sec. 199.9 Administrative remedies for fraud, abuse, and conflict of
interest
* * * * *
(n) Third-party billing agents as defined in Sec. 199.2(b) of this
part, while not considered providers, are subject to the provisions of
this section to the same extent as such provisions apply to providers.
[[Page 12955]]
Dated: February 1, 2013.
Patricia L. Toppings,
OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2013-03416 Filed 2-25-13; 8:45 am]
BILLING CODE 5001-06-P