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CMS Publishes Final Rule to Modernize PACE Regulations

Gavel and StethoscopeOn May 28, 2019, the Centers for Medicare & Medicaid Services ("CMS") finalized a rule (the "Final Rule") to update and modernize requirements for the Programs of All-Inclusive Care for the Elderly ("PACE").

PACE provides comprehensive medical and social services to certain frail and elderly individuals who qualify for nursing home care but, at the time of enrollment, can still live safely in the community. CMS characterized the Final Rule as the “first major update to the program since 2006."

According to CMS, the Final Rule provides administrative flexibility and regulatory relief for PACE organizations and strengthens protections and improves care for participants. The Final Rule will become effective on August 2, 2019.

The Final Rule includes the following changes:

  • Codifies CMS’ existing practice of relying on automated review systems for processing initial applications to become a PACE organization and expansion applications for existing PACE organizations;
  • Eliminates the requirement for PACE organizations to request waivers for many of the most commonly waived provisions;
  • Clarifies that PACE organizations that offer qualified prescription drug coverage must comply with Medicare Part D prescription drug program requirements unless the requirement has been waived;
  • Implements changes related to PACE enforcement actions, including sanctions and civil money penalties;
  • Adds language to help ensure that individuals with a criminal conviction related to physical, sexual, drug, or alcohol abuse or use will not be employed by a PACE organization in any capacity to the extent his or her contact with patients would pose a potential risk;
  • Eliminates the requirement for staff with direct participant contact to have at least one year of experience working with a frail or elderly population upon hire; instead, an applicant who meets all other requirements will be able to receive appropriate training from the PACE organization upon hire;
  • Allows for the use of remote technology for unscheduled reassessments in response to service delivery requests (SDRs) with a participant's consent; however, an in-person reassessment is required prior to denying an SDR;
  • Grants greater flexibility to PACE organizations with respect to the format and location of their interdisciplinary team meetings, including the allowance of video conferencing, conference calls or in-person meetings;
  • Eliminates the requirement that audits of PACE organizations by CMS must be conducted at least once every two years after a PACE organization completes an initial three-year trial period; instead, the frequency of audits during the post-trial period are to be based on a risk assessment undertaken by CMS;
  • Codifies the requirements, consistent with current practice, for PACE organizations to submit service area expansion applications to add a new PACE center and/or to expand their geographic service area; and
  • Clarifies principal language requirements for marketing materials by providing that, in the absence of a state standard, a principal language of the community would be any language spoken in the home by at least 5 percent of the individuals in the service area of the PACE organization.

The Final Rule is extensive and PACE organizations should carefully review the new guidelines to ensure compliance. For assistance, please contact Jennifer Van Regenmorter at (616) 796-2502 or Julie Hamlet at (616) 796-2515.

Categories: Health Care Reform, Medicare/Medicaid

 has particular expertise in health law and she represents providers with emphasis in the areas of physicians, hospice, home care and long term care, including one of the country’s largest long-term care organizations. She has a vast array of experience in teaming with providers in the areas of regulatory compliance and contracts. 

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