HHS Deregulation Proposes to Save Healthcare Providers $676 Million

The U.S. Department of Health and Human Services (HHS) has proposed to eliminate or change several regulations that will allow providers to streamline services and reduce costs, although one proposal also may reduce Medicare reimbursements.

The new rules, proposed yesterday, will save providers an estimated $676 million per year, based on HHS’s financial analysis. According to HHS, the proposed changes to the regulations will:

• Eliminate unnecessary requirements that ambulatory surgical centers (ASCs) must meet in order to provide radiological services that are an integral part of their surgical procedures, permitting them greater flexibility for physician supervision requirements.
• Save hospitals significant resources by permitting registered dietitians to order patient diets independently, which they are trained to do, without requiring the supervision or approval of a physician or other practitioner. This frees up time for physicians and other practitioners to care for patients.
• Permit trained nuclear medicine technicians in hospitals to prepare radiopharmaceuticals for nuclear medicine without the supervising physician or pharmacist constantly being present, which helps speed services to patients, particularly during off hours.
• Eliminate a redundant data submission requirement and an unnecessary survey process for transplant centers while maintaining strong federal oversight.

Only the proposed new regulations regarding ASC radiology services may pose a financial risk to providers who may find that the regulation transfers costs to areas currently not reimbursed by Medicare.

Healthcare providers have long found that the Medicare conditions of participation (CoPs) requirement “to have a radiologist supervise the provision of radiologic services is unduly burdensome, as many ASCs are having great difficulty locating a radiologist to supervise the ASC’s radiologic services,” according to the proposed new rules.

By eliminating the requirement of having a radiologist on-site, HHS estimates that ASCs will save an estimated $40.7 million per year, but adds that estimate “may represent an overstatement of the provision’s net social benefits.”

“Because the radiologic services in question do not involve any diagnostic activity, some portion of the radiology supervision fees may not represent actual labor costs, but would instead involve a transfer of value from radiologists (who currently receive supervision fees without having any diagnostics to supervise) to ASCs (which, if the proposed rule is finalized, would no longer pay those fees),” according to the HHS financial impact analysis of the proposed rule. “We lack data to estimate how much of the $40.7 million total is a transfer of this type, rather than a net social benefit.”

HHS is seeking comments on the proposed rules for the next 60 days. The rules and information on how to submit comments can be found here (PDF download).