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CMS Finalizes Changes to Unnecessary, Obsolete, Counterproductive or Excessively Burdensome Regulations

cms finalizes changesOn May 7, 2014, the Centers for Medicare and Medicaid Services (“CMS”) issued a Final Rule to reform Medicare regulations identified as “unnecessary, obsolete, counterproductive or excessively burdensome” to hospitals and other health care providers. The changes are part of the Obama administration’s “regulatory lookback” in connection with Executive Order 13563, “Improving Regulation and Regulatory Review.” The Final Rule makes a number of clarifications and revisions to policies set forth in both the May 16, 2012 final rule and the February 7, 2013, proposed rule. CMS estimates the reforms could save providers nearly $660 million annually and $3.2 billion over five years.

Below is a brief summary that highlights some of the issues CMS is attempting to address. Please refer to the Final Rule, or contact us, to explore the full extent of the changes in more detail.

Ambulatory Surgical Centers (ASC)

  • The requirements that ASCs must meet in order to provide radiological services to patients were relaxed.


  • Governing Body: The requirement that a medical staff member from at least one hospital in a system be included on the system’s governing body was rescinded. Instead, a governing body is now required to consult with the individual responsible for the organized medical staff.
  • Medical Staff: The Final Rule rejects CMS's proposal that each hospital must have its own medical staff, even in multi-hospital systems. Instead, the hospital Conditions of Participation (“CoPs”) now allow for a unified and integrated medical staff to be shared by multiple separately certified hospitals within a hospital system.
  • Dietetic Services: The Final Rule allows for others besides the practitioner responsible for the care of a patient to prescribe a therapeutic diet. For example, registered dietitians and other clinically qualified nutrition professionals may order patient diets under the CoPs.
  • Outpatient Services: The Final Rule revises requirements related to outpatient services.  Specifically, the CoPs allow orders for outpatient services to be made by a practitioner who is: (i) responsible for the care of the patient; (ii) licensed in the state; (iii) acting within the scope of practice; (iv) authorized in accordance with state law and policies adopted by the medical staff; and (v) approved by the governing body.

Transplant Centers and Organ Procurement Organizations

  • Transplant centers and organ procurement organizations will no longer be required to submit data to CMS that CMS routinely receives through other sources.

Long Term Care Facilities

  • Long term care facilities may apply for an extension, not to exceed two years, of a deadline to have automatic sprinkler systems installed.

Rural Health and Primary Care

  • Small critical access hospitals, rural health clinics and federally qualified health centers are no longer bound by the requirement that a physician must be held to a prescriptive on-site schedule.

The Final Rule was published in the May 12, 2014, Federal Register, with most provisions becoming effective 60 days after publication.  If you have any questions on these changes, please contact Gilbert Frimet at (248) 538-6353 or gfrimet@fosterswift.com or Nicole Stratton at (517) 371-8140 or nstratton@fosterswift.com

Categories: Compliance, Hospitals, Medicare/Medicaid, Providers, Regulatory

Photo of Gilbert M. Frimet
Senior Attorney

Gil has over 48 years of health care and administrative law experience.  A prolific writer, many articles authored and co­authored by Gil have appeared in Health Care Weekly Review and numerous health and legal publications.

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