CMS backs down on freestanding facility standards

February 21, 2007

The Centers for Medicare and Medicaid Services withdrew Feb. 19 the controversial changes proposed to its Program Integrity Manual for independent diagnostic testing facilities. Albeit warily, industry insiders hailed the agency’s will to reopen dialogue.

The Centers for Medicare and Medicaid Services withdrew Feb. 19 the controversial changes proposed to its Program Integrity Manual for independent diagnostic testing facilities. Albeit warily, industry insiders hailed the agency's will to reopen dialogue.

"There was tremendous pressure brought to bear on CMS as a result of the Program Integrity Manual Provisions," said W. Kenneth Davis Jr., a partner of the Katten Muchin Rosenman law firm in Chicago. "From a fairness standpoint, the industry had no opportunity to provide meaningful comment to CMS. And people within the industry had raised a lot of questions about what some of the provisions meant, specifically the ones related to no sharing of space and equipment by IDTFs."

CMS' Web site noted the agency had rescinded its change request 5449 to the Program Integrity Manual issued on Jan. 26 as Transmittal 187. The brief statement indicated that the ruling will not be replaced at this time, asked to discard all related materials, and apologized for the inconvenience.

CMS will not comment on the specific reasons to rescind Transmittal 187. The performance standard regulations that were issued in November of last year and became effective Jan. 1 remain in effect, said James Bossenmeyer, director of provider enrollment at the agency's Program Integrity Division. Bossenmeyer spoke Feb. 20 at a teleconference organized by the American Health Lawyers Association.

"Whenever the public has information that they would like to share regarding an existing CMS policy, they can write or send e-mail. Since CMS has rescinded the policy, we are happy to look at and consider any thought that the public might have as we go forward, and the best way to do that would be in writing," Bossenmeyer said.

CMS could benefit by explaining the language contained in the now-defunct provisions, said Thomas Greeson, a partner in the healthcare group of Reed Smith LLP in Falls Church, VA. He claimed the IDTF industry would appreciate an opportunity to respond in good faith and comply in a proper manner.

"I applaud CMS for having listened to the industry and rescinding the transmittal," Greeson said.

Other insiders speculated as to what the decision means for the future. They doubt, however, that CMS will change its objective.

"I'd be surprised if at some point in the near future we don't see some sort of rule-making coming forward from CMS to create regulations limiting the ability of IDTFs to 'share' space or equipment," Davis said.

For more information from the Diagnostic Imaging archives:

CMS gets tough with freestanding imaging facilities

Hasty budget action spurs petition for delay

Utilization rules should target self-referral

Teleradiology opens some doors, closes others

Danger lurks in schemes involving outside reads