Senate Delays Direct Supervision Mandate

The Protecting Access to Rural Therapy Services Act clarifies that general supervision of most outpatient therapeutic services by a physician or non-physician practitioner is sufficient for payment of therapeutic hospital outpatient services, the bill's co-sponsors say.

The U.S. Senate has passed legislation that delays through Dec. 31 the enforcement of a direct supervision policy for outpatient therapeutic services that critics complained would jeopardize services in rural areas, particularly for critical access hospitals.

"Many hospitals find the federal government's supervision requirements for outpatient therapy impossible to meet, which jeopardizes access to this important care," Sen. Jerry Moran, (R-KS), a sponsor of the bipartisan bill said in prepared remarks.

"Rural hospitals need reasonable flexibility to staff their facilities so they can provide a full range of services to their communities. I continue to advocate for passage of the Protecting Access to Rural Therapy Services Act, the PARTS Act, bipartisan legislation I introduced to permanently address this outpatient therapy supervision issue. In the meantime, I am pleased we were able to pass S. 1461 in the Senate to continue providing much needed regulatory relief to many hospitals in Kansas and across the country." 

The bill, which passed the Senate by unanimous consent last week, prohibits the Centers for Medicare & Medicaid Services from implementing the policy. Although the legislation is seen as bipartisan, it is not clear if the companion legislation sent to the House will become a casualty of the smoldering debate over funding for Planned Parenthood that threatens a shutdown of the federal government.

Moran, and co-sponsors Sens. John Thune, (R-SD), and Jon Tester, (D-MT), said in a joint statement that the extension provides additional time to advance the Protecting Access to Rural Therapy Services (PARTS) Act (S. 257), which clarifies that general supervision of most outpatient therapeutic services by a physician or non-physician practitioner is sufficient for payment of therapeutic hospital outpatient services.

The PARTS Act will:

• Require CMS to allow a default setting of general supervision, rather than direct supervision, for outpatient therapeutic services;
• Create an advisory panel to establish an exceptions process for risky and complex outpatient services;
• Create a special rule for CAHs that recognizes their unique size and Medicare conditions of participation; and
• Hold hospitals and CAHs harmless from civil or criminal action for failing to meet CMS's current direct supervision policy for the period 2001 through 2016.

Congress has prohibited CMS from enforcing the rule that requires direct physician oversight of outpatient therapy services at critical access and small rural hospitals after critics complained that it was particularly burdensome in areas where physicians are in short supply.

The practical effect was that relatively routine outpatient services such as drawing blood were restricted or even eliminated because physicians weren't readily available to provide immediate supervision.