Federal Officials Propose New Rule to Bolster Emergency Preparedness for Health Care Facilities

March 24th, 2014

Recently, the Centers for Medicare & Medicaid Services proposed extensive new emergency preparedness requirements for American health care facilities. Describing emergency preparedness as an “urgent public health issue,” the proposed rule outlines new requirements designed to prevent the types of severe disruptions to health care that followed the 9/11 attacks, Hurricane Katrina, the 2009 H1N1 influenza pandemic, tornado events in Missouri and Oklahoma in 2011, and Superstorm Sandy.

The proposed requirements aim to bring regulatory consistency to Medicare and Medicaid participating providers and suppliers. The proposal describes the current regulatory landscape as a “patchwork of federal, state, and local laws and guidelines,” and as a result some institutions are not required to plan extensively for emergencies while others are already meeting most of the proposed rule’s goals.  These new requirements have the potential to dramatically alter the current federal regulatory landscape by essentially making emergency preparedness a condition for any health care facility to participate in the Medicare and Medicaid programs. It is estimated that more than 68,000 health care institutions would be affected including large hospital chains, “mom and pop” nursing homes, home health agencies, rural health clinics, organ transplant procurement organizations, outpatient surgery sites, psychiatric hospitals for youths, and kidney dialysis centers.

The regulations would require, among other things, for hospitals, nursing facilities, and group homes to have plans to maintain emergency lighting, fire safety systems, manage sewage and waste disposal during power loss, and to maintain temperatures at safe levels for patients. Additionally, all inpatient facilities would be expected to have a system in place to track the location of staff and displaced patients, address subsistence needs for staff and patients (and possibly volunteers, visitors, and individuals from the community seeking shelter), manage volunteers, and provide care at alternate sites.

Transplant centers would need to identify alternate hospitals for patients awaiting organs. This would require transplant centers to have an agreement with at least one other Medicare-approved transplant center to provide transplantation services and other care for its patients in the event of an emergency. This requirement is similar to current Maryland state law which already requires dialysis centers to develop emergency preparedness plans to include procedures that ensure the continuity of services during an emergency, and if necessary, the relocation of patients.

Home health care agencies would be required to help patients create personalized disaster plans. Hospice and others caring for infirm, homebound patients would need to have procedures to help first responders locate those patients. Furthermore, many facilities including hospitals, nursing homes, clinics, and transplant centers would be required to develop training and testing that includes a yearly community mock disaster drill and a yearly paper-based, tabletop exercise.

The proposed rule signals that federal officials are aggressively pursuing a plan for a consistent nationwide regulation scheme that significantly increases the resiliency of America’s health care institutions. In particular, the new requirements focus heavily on the need to increase the backup power resiliency of health care facilities. Because generators during pervious emergencies have sometimes failed catastrophically, the proposed requirements call for hospitals and nursing homes to conduct yearly four-hour continuous generator testing instead of once every three-years, as is currently recommended. CHHS encourages this effort to improve health care facilities’ backup power resiliency.

CHHS staff members have already been engaged in projects to identify vulnerabilities in and making recommendations on how to improve Maryland’s energy infrastructure that experienced extensive outages and threatened health and safety during the February 2010 snowstorms, Hurricane Irene, the June Derecho 2012, and Superstorm Sandy.  Similarly, New York Officials are currently considering a proposal to phase in flood-proofing requirements for vulnerable hospitals, nursing homes, and adult care facilities, which would provide more reliable sources of power and climate control, similar to requirements found in the federal proposal.

While changes, testing, and retrofitting facilities to meet these requirements may initially be costly; ultimately, the new requirements may help facilities and organizations’ bottom lines. Robust emergency preparedness plans which increase a health care facility’s resiliency and ability to remain largely operable during an emergency can help reduce the significant revenue losses experienced by hospitals during recent disasters.  Following Hurricane Sandy, $180 million of the $810 million in damages reported by the New York City Health and Hospitals Corporation was due to lost revenue as a result of hospitals being forced to close.

It is estimated that compliance with the proposed requirements by all covered providers would result in a first-year total cost of $225 million, or roughly $8,000 on average for hospitals in the first year the rule takes effect. However, it is likely the financial impact of implementing the requirements will vary slightly depending upon the specific facility or organization.  It should be noted, that some experts criticize these cost estimates as being significantly underestimated and suggest the burden and costs associated with compliance to the rule could be oppressive.

In the near future, American health care facilities will likely continue to face serious challenges associated with natural and man-made disasters. In preparation, the proposed requirements aim to increase health care facilities’ resiliency by developing a regulatory approach that incorporate lessons learned from past emergencies, and proven best practices from the present. Regardless of whether the new federal requirements are adopted into law, CHHS sees this as an opportune time for health care facilities and organizations in Maryland, and all over the country, to reevaluate their existing emergency preparedness plans to ensure major disruptions to the delivery of health care during and following an emergency can be prevented.

The proposed rule, issued in December, is open for comment until later this month. Stay tuned for updates on the status of the proposed rule and its potential ramifications.

To submit a comment to the rule: http://www.regulations.gov/#!documentDetail;D=CMS-2013-0269-0002

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